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

|  |                                                                                                                                  
|- | ---------------------------------------------------------------------------------------------------------------------------------
|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2008
|  |                                                                                                                                  
|  | OR                                                                                                                               
|  |                                                                                                                                  
|o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
 THE SECURITIES EXCHANGE ACT OF 1934                                        
|  |                                                                                                                                  
|  | COMMISSION FILE NUMBER 001-13777                                                                                                 
|  |                                                                                                                                  
|  | GETTY REALTY CORP.                                                                                                               
|  |                                                                                                                                  
|  | (Exact name of registrant as specified in its charter)                                                                           

|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Maryland                                                       |  | 11-3412575                          
|                                                               |  |                                     
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. employer identification no.)
|                                                               |  |                                     
|125 Jericho Turnpike, Suite 103, Jericho, New York             |  | 11753                               
|                                                               |  |                                     
|(Address of principal executive offices)                       |  | (Zip Code)                          

Registrants
telephone number, including area code: (516) 478-5400

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

|                              |  |                                          
|----------------------------- |  | -----------------------------------------
|TITLE OF EACH CLASS           |  | NAME OF EACH EXCHANGE ON WHICH REGISTERED
|                              |  |                                          
|Common Stock, $0.01 par value |  | New York Stock Exchange                  

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

| |                  | 
| | ---------------- | 
| | None             | 
| |                  | 
| | (Title of Class) | 

Indicate by
check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.Yes o    No x

Indicate by
check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Exchange Act. Yes o    No x

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

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

Indicate by
check mark whether the registrant is a large accelerated filer, an accelerated
filer, a non-accelerated filer or a smaller reporting company. See the definitions
of large accelerated filer, accelerated filer and smaller reporting
company in Rule 12b-2 of the Exchange Act. (Check one):

|                                              |                     |                         |                            
|--------------------------------------------- | ------------------- | ----------------------- | ---------------------------
|Large accelerated filer o                     | Accelerated filer x | Non-accelerated filer o | Smaller reporting company o
|(Do not check if a smaller reporting company)

Indicate by
check mark whether the registrant is a shell company (as defined in Rule 12b-2
of the Exchange Act).Yes o    No x

The aggregate
market value of common stock held by non-affiliates (17,354,865 shares of common
stock) of the Company was $250,083,605 as of June 30, 2008.

The registrant
had outstanding 24,766,166 shares of common stock as of March 2, 2009.

DOCUMENTS INCORPORATED BY REFERENCE

|                                                                                                                                                                                                                                                                                     |  |                  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | -----------------
|DOCUMENT                                                                                                                                                                                                                                                                             |  | PART OF FORM 10-K
|                                                                                                                                                                                                                                                                                     |  |                  
|Selected Portions of Definitive Proxy Statement for the 2009 Annual
 Meeting of Stockholders (the Proxy Statement), which will be filed by the
 registrant on or prior to 120 days following the end of the registrants year
 ended December 31, 2008 pursuant to Regulation 14A. |  | III              

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TABLE OF CONTENTS

|     |  |                                                                                                               |  |     
|---- |  | ------------------------------------------------------------------------------------------------------------- |  | ----
|Item |  | Description                                                                                                   |  | Page
|     |  |                                                                                                               |  |     
|     |  |                                                                                                               |  |     
|     |  | Cautionary Note Regarding Forward-Looking
Statements                                                          |  | 1   
|     |  |                                                                                                               |  |     
|     |  | PART I                                                                                                        |  |     
|     |  |                                                                                                               |  |     
|1    |  | Business                                                                                                      |  | 3   
|1A   |  | Risk Factors                                                                                                  |  | 7   
|1B   |  | Unresolved Staff Comments                                                                                     |  | 17  
|2    |  | Properties                                                                                                    |  | 18  
|3    |  | Legal Proceedings                                                                                             |  | 20  
|4    |  | Submission of Matters to a Vote of Security
Holders                                                           |  | 24  
|     |  |                                                                                                               |  |     
|     |  | PART II                                                                                                       |  |     
|     |  |                                                                                                               |  |     
|5    |  | Market for Registrants Common Equity, Related
 Stockholder Matters and Issuer Purchases of Equity Securities |  | 25  
|6    |  | Selected Financial Data                                                                                       |  | 27  
|7    |  | Managements Discussion and Analysis of
Financial
 Condition and Results of Operations                        |  | 28  
|7A   |  | Quantitative and Qualitative Disclosures About Market
 Risk                                                   |  | 44  
|8    |  | Financial Statements and Supplementary
Data                                                                   |  | 45  
|9    |  | Changes in and Disagreements with Accountants on
 Accounting and Financial Disclosure                         |  | 65  
|9A   |  | Controls and Procedures                                                                                       |  | 65  
|9B   |  | Other Information                                                                                             |  | 65  
|     |  |                                                                                                               |  |     
|     |  | PART III                                                                                                      |  |     
|     |  |                                                                                                               |  |     
|10   |  | Directors, Executive Officers and Corporate
 Governance                                                       |  | 66  
|11   |  | Executive Compensation                                                                                        |  | 66  
|12   |  | Security Ownership of Certain Beneficial Owners and
 Management and Related Stockholder Matters               |  | 66  
|13   |  | Certain Relationships and Related Transactions, and
 Director Independence                                    |  | 67  
|14   |  | Principal Accountant Fees and Services                                                                        |  | 67  
|     |  |                                                                                                               |  |     
|     |  | PART IV                                                                                                       |  |     
|     |  |                                                                                                               |  |     
|15   |  | Exhibits and Financial Statement
Schedules                                                                    |  | 68  
|     |  |                                                                                                               |  |     
|     |  | Signatures                                                                                                    |  | 84  
|     |  | Exhibit Index                                                                                                 |  | 85  

ii

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Cautionary
Note Regarding Forward-Looking Statements

Certain
statements in this Annual Report on Form 10-K may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. When we use the words believes, expects, plans, projects,
estimates, predicts and similar expressions, we intend to identify
forward-looking statements. (All capitalized and undefined terms used in this
section shall have the same meanings hereafter defined below in this Annual
Report on Form 10-K.) Examples of forward-looking statements include statements
regarding the developments related to our primary tenant, Getty Petroleum
Marketing Inc. (Marketing) which is a wholly owned subsidiary of OAO LUKoil
(Lukoil), and the Marketing Leases (as defined below) included in Item 1A.
Risk Factors and Item 7. Managements Discussion and Analysis of Financial
Condition and Results of Operations - Developments Related to Marketing and the
Marketing Leases and elsewhere in this Annual Report on Form 10-K; the impact
of any modification or termination of the Marketing Leases on our business and
ability to pay dividends or our stock price; our belief that Lukoil would not
allow Marketing to fail to perform its rental, environmental and other
obligations under the Marketing Leases; our belief that it is not probable that
Marketing will not pay for substantially all of the Marketing Environmental
Liabilities (as defined below); our decision to attempt to negotiate with Marketing
for a modification of the Marketing Leases which removes the Subject Properties
(as defined below) or the Revised Subject Properties (as defined below) from
the Marketing Leases; our ability to predict if or when the Marketing Leases
will be modified or terminated, the terms of any such modification or
termination or what actions Marketing and Lukoil will take and what our
recourse will be whether the Marketing Leases are modified or terminated or
not; our belief that it is probable that we will collect the deferred rent
receivable related to the Remaining Properties (as defined below); our belief
that no impairment charge is necessary for the Subject Properties or the
additional properties included within the list of Revised Subject Properties;
the expected effect of regulations on our long-term performance; our expected
ability to maintain compliance with applicable regulations; our ability to
renew expired leases; the adequacy of our current and anticipated cash flows
from operations, borrowings under our credit agreement and available cash and
cash equivalents; our ability to re-let properties at market rents or sell
properties; our belief that we do not have a material liability for offers and
sales of our securities made pursuant to registration statements that did not
contain the financial statements or summarized financial data of Marketing; our
expectations regarding future acquisitions; our ability to maintain our federal
tax status as a real estate investment trust (REIT); the probable outcome of
litigation or regulatory actions; our expected recoveries from underground
storage tank funds; our exposure to environmental remediation costs; our
estimates regarding remediation costs; our expectations as to the long-term
effect of environmental liabilities on our business, financial condition;
results of operations, liquidity, ability to pay dividends and stock price our
exposure to interest rate fluctuations and the manner in which we expect to
manage this exposure; the expected reduction in interest-rate risk resulting
from our interest rate swap agreement and our expectation that we will not
settle the interest rate swap agreement prior to its maturity; the expectation
that the Credit Agreement (as defined below) will be refinanced with variable interest-rate
debt at its maturity; our expectations regarding corporate level federal income
taxes; the indemnification obligations of the Company and others; our
assessment of the likelihood of future competition; our assessment as to the
adequacy of our insurance coverage; our belief that Marketing had vacancies
and/or removed the gasoline tanks and related equipment at what may be as much
as 10% or more of the properties subject to the Marketing Leases; assumptions
regarding the future applicability of accounting estimates, assumptions and
policies; our intention to pay future dividends and the amounts thereof; and
our beliefs about the reasonableness of our accounting estimates, judgments and
assumptions.

These
forward-looking statements are based on our current beliefs and assumptions and
information currently available to us, and involve known and unknown risks
(including the risks described below in Item 1A. Risk Factors and other risks
that we describe from time to time in our other filings with the Securities and
Exchange Commission (SEC)), uncertainties and other factors which may cause
our actual results, performance and achievements to be materially different
from any future results, performance or achievements expressed or implied by these
forward- looking statements. These factors include, but are not limited to:
risks associated with owning and leasing real estate generally; dependence on
Marketing as a tenant and on rentals from companies engaged in the petroleum
marketing and convenience store businesses; adverse developments in general
business, economic or political conditions our unresolved SEC comment;
competition for properties and tenants; risk of performance of our tenants of
their lease obligations, tenant non-renewal and our ability to re-let or sell
vacant properties; the effects of taxation and other regulations; potential
litigation exposure; costs of completing environmental remediation and of
compliance with environmental regulations; the exposure to counterparty risk; the
risk of loss of our management



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team; the impact of our
electing to be treated as a REIT under the federal income tax laws, including
subsequent failure to qualify as a REIT; risks associated with owning real
estate primarily concentrated in the Northeast and Mid-Atlantic regions of the
United States; risks associated with potential future acquisitions; losses not
covered by insurance; future dependence on external sources of capital; the
risk that our business operations may not generate sufficient cash for
distributions or debt service; our potential inability to pay dividends; and
terrorist attacks and other acts of violence and war. As a result of these and
other factors, we may experience material fluctuations in future operating
results on a quarterly or annual basis, which could materially and adversely
affect our business, financial condition, operating results and/or stock price.
An investment in our stock involves various risks, including those mentioned
above and elsewhere in this report and those that are described from time to
time in our other filings with the SEC.

You
should not place undue reliance on forward-looking statements, which reflect
our view only as of the date hereof. We undertake no obligation to publicly
release revisions to these forward-looking statements that reflect future
events or circumstances or reflect the occurrence of unanticipated events.

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PART I

Item 1.
Business

Overview

Getty
Realty Corp., a Maryland corporation, is the largest publicly-traded real
estate investment trust (REIT) in the United States specializing in the
ownership and leasing of retail motor fuel and convenience store properties and
petroleum distribution terminals. As of December 31, 2008, we owned eight
hundred seventy-eight properties and leased one hundred eighty-two additional
properties. Our properties are located primarily in the Northeast and the
Mid-Atlantic regions in the United States. The Company also owns or leases
properties in Texas, North Carolina, Hawaii, California, Florida, Arkansas,
Illinois, Ohio and North Dakota.

Nearly
all of our properties are leased or sublet to distributors and retailers
engaged in the sale of gasoline and other motor fuel products, convenience
store products and automotive repair services who are responsible for the
payment of taxes, maintenance, repair, insurance and other operating expenses
and for managing the actual operations conducted at these properties. As of
December 31, 2008, we leased approximately 82% of our owned and leased
properties on a long-term basis to Getty Petroleum Marketing Inc.
(Marketing). Marketing is wholly-owned by a subsidiary of OAO LUKoil
(Lukoil), one of the largest integrated Russian oil companies. Marketing
operates the petroleum distribution terminals but typically does not itself
directly operate the retail motor fuel and convenience store properties it
leases from us. Rather, Marketing generally subleases our retail properties to
distributors and retailers who are responsible for the actual operations at the
locations and operate their convenience stores, automotive repair services or
other businesses at our properties. (For information regarding factors that
could adversely affect us relating to Marketing or our other lessees, see Item
1A. Risk Factors. For additional information regarding developments related to
Marketing and the Marketing Leases (as defined below), see Item 7.
Managements Discussion and Analysis of Financial Condition and Results of
Operations  General  Developments Related to Marketing and the Marketing
Leases.)

We
are self-administered and self-managed by our experienced management team,
which has over ninety-eight years of combined experience in owning, leasing and
managing retail motor fuel and convenience store properties. Our executive
officers are engaged exclusively in the day-to-day business of the Company. We
administer nearly all management functions for our properties, including
leasing, legal, data processing, finance and accounting. We have invested, and
will continue to invest, in real estate and real estate related investments,
such as mortgage loans, when appropriate opportunities arise.

The
History of Our Company

Our
founders started the business in 1955 with the ownership of one gasoline
service station in New York City and combined real estate ownership, leasing
and management with actual service station operation and petroleum
distribution. We held our initial public offering in 1971 under the name Power
Test Corp. We acquired, from Texaco in 1985, the petroleum distribution and
marketing assets of Getty Oil Company in the Northeast United States along with
the Getty® name and trademark in connection with our real estate and the
petroleum marketing business in the United States. We became one of the largest
independent owner/operators of petroleum marketing assets in the country,
serving retail and wholesale customers through a distribution and marketing
network of Getty® and other branded retail motor fuel and convenience store
properties and petroleum distribution terminals.

Marketing
was formed to facilitate the spin-off of our petroleum marketing business to
our shareholders which was completed in 1997 (the Spin-Off). At that time,
our shareholders received a tax-free dividend of one share of common stock of
Marketing for each share of our common stock. Following the Spin-Off, Marketing
held the assets and liabilities of our petroleum marketing operations and a
portion of our home heating oil business, and we continued to operate primarily
as a real estate company specializing in the ownership and leasing of retail
motor fuel and convenience store properties and petroleum distribution
terminals. We acquired Power Test Investors Limited Partnership (the Partnership)
in 1998, thereby acquiring fee title to two hundred ninety-five properties we
had previously leased from the Partnership and which the Partnership had
acquired from Texaco in 1985. We later sold

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the remaining portion of
our home heating oil business. As a result, we are now exclusively engaged in
the ownership, leasing and management of real estate assets, principally in the
petroleum marketing industry.

Marketing
was acquired by a U.S. subsidiary of Lukoil in December 2000. In connection
with Lukoils acquisition of Marketing, we renegotiated our long-term unitary
lease (the Master Lease) with Marketing. As of December 31, 2008, Marketing
leased from us eight hundred fifty-four properties under the Master Lease and
ten properties under supplemental leases (collectively with the Master Lease,
the Marketing Leases). Eight hundred fifty-five of the properties leased to
Marketing are retail motor fuel and convenience store properties and nine of
the properties are petroleum distribution terminals. Seven hundred ten of the
properties leased to Marketing are owned by us and one hundred fifty-four of
the properties are leased by us from third parties. The Master Lease has an
initial term expiring in December 2015, and generally provides Marketing with
three renewal options of ten years each and a final renewal option of three
years and ten months extending to 2049. Each of the renewal options may be
exercised only on an all or nothing basis. The supplemental leases have
initial terms of varying expiration dates. The Marketing Leases are
triple-net leases, pursuant to which Marketing is responsible for the payment
of taxes, maintenance, repair, insurance and other operating expenses. We have
licensed the Getty® trademarks to Marketing on an exclusive basis in its
marketing territory as of December 2000. We have also licensed the trademarks
to Marketing on a non-exclusive basis outside that territory, subject to a
gallonage-based royalty, although to date, Marketing has not used the trademark
outside that territory. (For additional information regarding developments
related to Marketing and the Marketing Leases, see Item 7. Managements
Discussion and Analysis of Financial Condition and Results of Operations 
General  Developments Related to Marketing and the Marketing Leases.)

We
elected to be treated as a REIT under the federal income tax laws beginning
January 1, 2001. A REIT is a corporation, or a business trust that would
otherwise be taxed as a corporation, which meets certain requirements of the
Internal Revenue Code. The Internal Revenue Code permits a qualifying REIT to
deduct dividends paid, thereby effectively eliminating corporate level federal
income tax and making the REIT a pass-through vehicle for federal income tax purposes.
To meet the applicable requirements of the Internal Revenue Code, a REIT must,
among other things, invest substantially all of its assets in interests in real
estate (including mortgages and other REITs) or cash and government securities,
derive most of its income from rents from real property or interest on loans
secured by mortgages on real property, and distribute to shareholders annually
a substantial portion of its otherwise taxable income. As a REIT, we are
required to distribute at least ninety percent of our taxable income to our
shareholders each year and would be subject to corporate level federal income
taxes on any taxable income that is not distributed.

Real
Estate Business

The
operators of our properties are primarily distributors and retailers engaged in
the sale of gasoline and other motor fuel products, convenience store products
and automotive repair services. Over the past decade, these lines of business
have matured into a single industry as operators increased their emphasis on
co-branded locations with multiple uses. The combination of petroleum product
sales with other offerings, particularly convenience store products, has helped
provide one-stop shopping for consumers and we believe represented a driving
force behind the industrys historical growth. In addition, approximately
twenty of our properties are directly leased by us to others for other uses such
as fast food restaurants, automobile sales and other retail purposes. In those
instances where we determine that the highest and best use for our properties
is no longer a retail motor fuel outlet, we will seek alternative tenants or
buyers for such properties as opportunities arise.

Revenues
from rental properties for the year ended December 31, 2008 were $81.2 million
which is comprised of $78.6 million of lease payments received and $2.5 million
of deferred rental income recognized due to the straight-line method of
accounting for the leases with Marketing and certain of our other tenants and
amortization of above-market and below-market rent for acquired in-place
leases. In 2008, we received lease payments from Marketing aggregating
approximately $60.3 million (or 77%) of the $78.6 million lease payments
received. We are materially dependent upon the ability of Marketing to meet its
rental, environmental and other obligations under the Marketing Leases.
Marketings financial results depend largely on retail petroleum marketing
margins and rental income from subtenants who operate our properties. As permitted
under the terms of our leases with Marketing, Marketing can generally use each
property for any lawful purpose, or for no purpose whatsoever. The petroleum
marketing industry has been and continues to be volatile and highly
competitive. Marketing has made all required

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monthly rental payments under the Marketing Leases when due, although
there is no assurance that it will continue to do so. (For additional
information regarding developments related to Marketing and the Marketing
Leases, see Item 7. Managements Discussion and Analysis of Financial
Condition and Results of Operations  General  Developments Related to
Marketing and the Marketing Leases.) You can find more information about our
revenues, profits and assets by referring to the financial statements and supplemental
financial information in Item 8. Financial Statements and Supplementary Data.

As of
December 31, 2008, we owned fee title to eight hundred sixty-nine retail motor
fuel, convenience store and other retail properties and nine petroleum distribution
terminals. We also leased one hundred eighty-two retail motor fuel, convenience
store and other retail properties. Our typical property is used as a retail
motor fuel and/or convenience store, and is located on between one-half and
three quarters of an acre of land in a metropolitan area. Our properties are
located primarily in the Northeast and the Mid-Atlantic regions in the United
States. The Company also owns or leases properties in Texas, North Carolina,
Hawaii, California, Florida, Arkansas, Illinois, Ohio and North Dakota.
Approximately one-half of our retail motor fuel properties have repair bays
(typically two or three bays per station) and nearly half have convenience
stores, canopies or both. We lease four thousand square feet of office space at
125 Jericho Turnpike, Jericho, New York, which is used for our corporate
headquarters.

We believe
our network of retail motor fuel and convenience store properties and terminal
properties across the Northeast and the Mid-Atlantic regions of the United
States is unique and that comparable networks of properties are not readily
available for purchase or lease from other owners or landlords. Many of our
properties are located at highly trafficked urban intersections or conveniently
close to highway entrance and exit ramps. Furthermore, we believe that
obtaining the permits necessary to operate a network of petroleum marketing
properties such as ours would be a difficult, time consuming and costly process
for any potential competitor. However, the real estate industry is highly
competitive, and we compete for tenants with a large number of property owners.
Our principal means of competition are rents charged in relation to the income
producing potential of the location. In addition, we expect other major real
estate investors with significant capital will compete with us for attractive
acquisition opportunities. These competitors include petroleum manufacturing,
distributing and marketing companies, other REITs, investment banking firms and
private institutional investors. This competition has increased prices for
commercial properties and may impair our ability to make suitable property
acquisitions on favorable terms in the future.

As part of
our overall growth strategy we regularly review opportunities to acquire
additional properties and we expect to continue to pursue acquisitions that we
believe will benefit our financial performance. To the extent that our current
sources of liquidity are not sufficient to fund such acquisitions we will
require other sources of capital, which may or may not be available on
favorable terms or at all.

Trademarks

We own the
Getty® name and trademark in connection with our real estate and the petroleum
marketing business in the United States and have licensed the Getty® trademarks
to Marketing on an exclusive basis in its marketing territory as of December
2000. We have also licensed the trademarks to Marketing on a non-exclusive
basis outside that territory, subject to a gallonage-based royalty, although to
date, Marketing has not used the trademark outside that territory. The
trademark licenses with Marketing are coterminous with the Master Lease.

Regulation

We are
subject to numerous existing federal, state and local laws and regulations
including matters related to the protection of the environment such as the
remediation of known contamination and the retirement and decommissioning or
removal of long-lived assets including buildings containing hazardous
materials, underground storage tanks (UST or USTs) and other equipment.
Petroleum properties are governed by numerous federal, state and local
environmental laws and regulations. These laws have included: (i) requirements
to report to governmental authorities discharges of petroleum products into the
environment and, under certain circumstances, to remediate the soil and/or
groundwater contamination pursuant to governmental order and directive, (ii)
requirements to remove and replace USTs that have exceeded governmental-mandated
age limitations and (iii) the requirement to

5

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provide a certificate of financial responsibility with respect to
claims relating to UST failures. Our tenants are directly responsible for
compliance with various environmental laws and regulations as the operators of
our properties.

We believe
that we are in substantial compliance with federal, state and local provisions
enacted or adopted pertaining to environmental matters. Although we are unable
to predict what legislation or regulations may be adopted in the future with
respect to environmental protection and waste disposal, existing legislation
and regulations have had no material adverse effect on our competitive
position. (For additional information with respect to pending environmental lawsuits
and claims see Item 3. Legal Proceedings.)

Environmental
expenses are principally attributable to remediation costs which include
installing, operating, maintaining and decommissioning remediation systems,
monitoring contamination, and governmental agency reporting incurred in
connection with contaminated properties. We seek reimbursement from state UST
remediation funds related to these environmental expenses where available. We
enter into leases and various other agreements which allocate responsibility
for known and unknown environmental liabilities by establishing the percentage
and method of allocating responsibility between the parties. In accordance with
leases with certain tenants, we have agreed to bring the leased properties with
known environmental contamination to within applicable standards and to
regulatory or contractual closure (Closure) in an efficient and economical
manner. Generally, upon achieving Closure at an individual property, our
environmental liability under the lease for that property will be satisfied and
future remediation obligations will be the responsibility of our tenant. As of
December 31, 2008, we have regulatory approval for remediation action plans in
place for two hundred forty-nine (95%) of the two hundred sixty-two properties
for which we continue to retain remediation responsibility and the remaining
thirteen properties (5%) were in the assessment phase. In addition, we have
nominal post-closure compliance obligations at twenty-four properties where we
have received no further action letters.

Our tenants
are directly responsible to pay for (i) remediation of environmental
contamination they cause and compliance with various environmental laws and
regulations as the operators of our properties, and (ii) environmental
liabilities allocated to our tenants under the terms of our leases and various
other agreements between our tenants and us. Generally, the liability for the
retirement and decommissioning or removal of USTs and other equipment is the
responsibility of our tenants. We are contingently liable for these obligations
in the event that our tenants do not satisfy their responsibilities. A
liability has not been accrued for obligations that are the responsibility of
our tenants based on our tenants past histories of paying such obligations
and/or our assessment of their respective financial abilities to pay their
share of such costs. However, there can be no assurance that our assessments
are correct or that our tenants who have paid their obligations in the past
will continue to do so.

It is
possible that our assumptions regarding the ultimate allocation methods and
share of responsibility that we used to allocate environmental liabilities may
change, which may result in adjustments to the amounts recorded for
environmental litigation accruals, environmental remediation liabilities and
related assets. We will be required to accrue for environmental liabilities
that we believe are allocable to others under various agreements if we
determine that it is probable that the counter-party will not meet its
environmental obligations. We may ultimately be responsible to directly pay for
environmental liabilities as the property owner if the counterparty fails to
pay them. The ultimate resolution of these matters could have a material
adverse effect on our business, financial condition, results of operations,
liquidity, ability to pay dividends and/or stock price.

For
additional information please refer to Item 1A. Risk Factors and to General
 Developments Related to Marketing and the Marketing Leases, Liquidity and
Capital Resources, Environmental Matters and Contractual Obligations in
Managements Discussion and Analysis of Financial Condition and Results of
Operations which appear in Item 7. of this Annual Report on Form 10-K.

Personnel

As of
February 1, 2009, we had sixteen employees.

6

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Access to our filings with the Securities and
Exchange Commission and Corporate Governance Documents

Our website
address is www.gettyrealty.com. Our address, phone number and a list of our
officers is available on our website. Our website contains a hyperlink to the
EDGAR database of the Securities and
Exchange Commission at www.sec.gov where you can access, free-of-charge,
our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports
on Form 8-K, and all amendments to these reports as soon as reasonably
practicable after such reports are filed. Our website also contains our
business conduct guidelines, corporate governance guidelines and the charters
of the Compensation, Nominating/Corporate Governance and Audit Committees of
our Board of Directors. We also will provide copies of these reports and
corporate governance documents free-of-charge upon request, addressed to Getty
Realty Corp., 125 Jericho Turnpike, Suite 103, Jericho, NY 11753, Attn:
Investor Relations. Information available on or accessible through our website
shall not be deemed to be a part of this Annual Report on Form 10-K. You may
read and copy any materials that we file with the Securities and Exchange Commission at the Securities and Exchange Commissions
Public Reference Room at 100
F Street, N.E., Washington, DC 20549. You may obtain information on the
operation of the Public Reference Room by calling the Securities and Exchange Commission at 1-800-SEC-0330.

Item 1A. Risk Factors

We are
subject to various risks, many of which are beyond our control. As a result of
these and other factors, we may experience material fluctuations in our future
operating results on a quarterly or annual basis, which could materially and
adversely affect our business, financial condition, results of operations
liquidity, ability to pay dividends and/or stock price. An investment in our stock
involves various risks, including those mentioned below and elsewhere this
Annual Report on Form 10-K and those that are described from time to time in
our other filings with the SEC.

We are subject to
risks inherent in owning and leasing real estate.

We are
subject to varying degrees of risk generally related to leasing and owning real
estate many of which are beyond our control. In addition to general risks
related to owning properties used in the petroleum marketing industry, our
risks include, among others:

|  |                                                                                                    
|- | ---------------------------------------------------------------------------------------------------
| | our
 liability as a lessee for long-term lease obligations regardless of our
 revenues,            
|  |                                                                                                    
| | deterioration
 in national, regional and local economic and real estate market conditions,         
|  |                                                                                                    
| | potential
 changes in supply of, or demand for, rental properties similar to ours,                 
|  |                                                                                                    
| | competition
 for tenants and declining rental rates,                                               
|  |                                                                                                    
| | difficulty
 in re-letting properties on favorable terms or at all,                                 
|  |                                                                                                    
| | impairments
 in our ability to collect rent payments when due,                                     
|  |                                                                                                    
| | increases in
 interest rates and adverse changes in the availability, cost and terms of
 financing,
|  |                                                                                                    
| | the
 potential for uninsured casualty and other losses,                                            
|  |                                                                                                    
| | the impact
 of present or future environmental legislation and compliance with
 environmental laws,
|  |                                                                                                    
| | adverse
 changes in zoning laws and other regulations, and                                         
|  |                                                                                                    
| | acts of
 terrorism and war.                                                                        

Each of
these factors could cause a material adverse effect on our business, financial
condition, results of operations, liquidity, ability to pay dividends and/or
stock price. In addition, real estate investments are relatively

7

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illiquid, which means that our ability to vary our portfolio of
properties in response to changes in economic and other conditions may be
limited.

Adverse developments
in general business, economic, or political conditions could have a material
adverse effect on us.

Adverse
developments in general business and economic conditions, including through
recession, downturn or otherwise, either in the economy generally or in those
regions in which a large portion of our business is conducted, could have a
material adverse effect on us and significantly increase certain of the risks
we are subject to. The general economic conditions in the United States are,
and for an extended period of time may be, significantly less favorable than
that of recent years. Among other effects, adverse economic conditions could
depress real estate values, impact our ability to re-let or sell our properties
and have and adverse effect on our tenants level of sales and financial
performance generally. Our revenues are dependent on the economic success of
our tenants and any factors that adversely impact our tenants could also have a
material adverse effect on our business, financial condition and results of
operations liquidity, ability to pay dividends and/or stock price.

Because our revenues
are primarily dependent on the performance of Getty
Petroleum Marketing
Inc., our primary tenant, in the event that Marketing cannot or will not perform its
rental, environmental and other obligations under the Marketing Leases, or if
the Marketing Leases are modified significantly or terminated, or if it becomes probable
that Marketing will not pay its environmental obligations, or if we change our assumptions
for rental revenue
or environmental liabilities related to the Marketing Leases, our
business, financial
condition, revenues, operating expenses, results of operations, liquidity, ability to
pay dividends and/or stock price could be materially adversely affected. No
assurance can be given that Marketing will have the ability to pay its debts or
meet its rental, environmental or other obligations under the Marketing
Leases.

Marketings
financial results depend largely upon retail petroleum marketing margins from
the sale of refined petroleum products at margins in excess of its fixed and
variable expenses and rental income from its subtenants who operate their
convenience stores, automotive repair service or other businesses at our
properties. The petroleum marketing industry has been, and continues to be,
volatile and highly competitive. A large, rapid increase in wholesale petroleum
prices would adversely affect Marketings profitability and cash flow if the
increased cost of petroleum products could not be passed on to Marketings
customers or if the consumption of gasoline for automotive use were to decline
significantly. Petroleum products are commodities, the prices of which depend
on numerous factors that affect supply and demand. The prices paid by Marketing
and other petroleum marketers for products are affected by global, national and
regional factors. We cannot accurately predict how these factors will affect
petroleum product prices or supply in the future, or how in particular they
will affect Marketing or our other tenants.

A
substantial portion of our revenues (75% for the year ended December 31, 2008)
are derived from the Marketing Leases. Accordingly, our revenues are dependent
to a large degree on the economic performance of Marketing and of the petroleum
marketing industry, and any factor that adversely affects Marketing, or our
relationship with Marketing, may have a material adverse effect on our
business, financial condition, revenues, operating expenses, results of
operations, liquidity, ability to pay dividends and/or stock price. Through
March 2009, Marketing has made all required monthly rental payments under
the Marketing Leases when due, although there is no assurance that it will
continue to do so. Even though Marketing is wholly-owned by a subsidiary of
Lukoil, and Lukoil has in prior periods provided credit enhancement and capital
to Marketing, Lukoil is not a guarantor of the Marketing Leases and there can
be no assurance that Lukoil is currently providing, or will provide, any credit
enhancement or additional capital to Marketing.

In
accordance with accounting principles generally accepted in the United States
of America (GAAP), the aggregate minimum rent due over the current terms of
the Marketing Leases, substantially all of which are scheduled to expire in
December 2015, is recognized on a straight-line basis rather than when the cash
payment is due. We have recorded the cumulative difference between lease
revenue recognized under this straight line accounting method and the lease
revenue recognized when the payment is due under the contractual payment terms
as deferred rent receivable on our consolidated balance sheet. We provide
reserves for a portion of the recorded deferred rent receivable if
circumstances indicate that a property may be disposed of before the end of the
current lease term or if it is not reasonable to assume that a tenant will make
all of its contractual lease payments when due

8

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during the
current lease term. Our assessments and assumptions regarding the
recoverability of the deferred rent receivable related to the properties
subject to the Marketing Leases are reviewed on a regular basis and such
assessments and assumptions are subject to change.

We
have had periodic discussions with representatives of Marketing regarding
potential modifications to the Marketing Leases and in 2007, during the course
of such discussions, Marketing has proposed to (i) remove approximately 40% of
the properties (the Subject Properties) from the Marketing Leases and
eliminate payment of rent to us, and eliminate or reduce payment of operating
expenses, with respect to the Subject Properties, and (ii) reduce the aggregate
amount of rent payable to us for the approximately 60% of the properties that
would remain under the Marketing Leases (the Remaining Properties).
Representatives of Marketing have also indicated to us that they are
considering significant changes to Marketings business model. In light of
these developments, and the continued deterioration in Marketings annual
financial performance (as discussed below), in March 2008 we decided to attempt
to negotiate with Marketing for a modification of the Marketing Leases which
removes the Subject Properties from the Marketing Leases. We have held periodic
discussions with Marketing since March 2008 in our attempt to negotiate a
modification of the Marketing Leases to remove the Subject Properties. Although
we continue to remove individual locations from the Master Lease as mutually
beneficial opportunities arise, there has been no agreement between us and
Marketing on any principal terms that would be the basis for a definitive
Master Lease modification agreement. If Marketing ultimately determines that
its business strategy is to exit all of the properties it leases from us or to
divest a composition of properties different from the properties comprising the
Subject Properties, such as the revised list of properties provided to us by Marketing
in the second quarter of 2008 which includes approximately 45% of the
properties Marketing leases from us ( the Revised Subject Properties), it is
our intention to cooperate with Marketing in accomplishing those objectives if
we determine that it is prudent for us to do so. Any modification of the
Marketing Leases that removes a significant number of properties from the
Marketing Leases would likely significantly reduce the amount of rent we
receive from Marketing and increase our operating expenses. We cannot
accurately predict if, or when, the Marketing Leases will be modified or what
the terms of any agreement may be if the Marketing Leases are modified. We also
cannot accurately predict what actions Marketing and Lukoil may take, and what
our recourse may be, whether the Marketing Leases are modified or not.

We
intend either to re-let or sell any properties removed from the Marketing
Leases and reinvest the realized sales proceeds in new properties. We intend to
seek replacement tenants or buyers for properties removed from the Marketing
Leases either individually, in groups of properties, or by seeking a single
tenant for the entire portfolio of properties subject to the Marketing Leases.
Although we are the fee or leasehold owner of the properties subject to the
Marketing Leases and the owner of the Getty® brand and have prior experience
with tenants who operate their gas stations, convenience stores, automotive
repair services or other businesses at our properties; in the event that properties
are removed from the Marketing Leases, we cannot accurately predict if, when,
or on what terms, such properties could be re-let or sold.

Due
to the previously disclosed deterioration in Marketings annual financial
performance, in conjunction with our decision to attempt to negotiate with
Marketing for a modification of the Marketing Leases to remove the Subject
Properties, we have decided that we cannot reasonably assume that we will
collect all of the rent due to us related to the Subject Properties for the
remainder of the current lease terms. In reaching this conclusion, we relied on
various indicators, including, but not limited to, the following financial
results of Marketing through the year ended December 31, 2007: (i) Marketings significant
operating losses, (ii) its negative cash flow from operating activities, (iii)
its asset impairment charges for underperforming assets, and (iv) its negative
earnings before interest, taxes, depreciation, amortization and rent payable to
the Company. We have not received Marketings financial results for the year
ended December 31, 2008 prior to the preparation of this Annual Report on Form
10-K.

We
recorded a reserve of $10.5 million in 2007 representing the full amount of the
deferred rent receivable recorded related to the Subject Properties as of
December 31, 2007. Providing the $10.5 million non-cash deferred rent
receivable reserve reduced our net earnings and our funds from operations for
2007 but did not impact our cash flow from operating activities or adjusted
funds from operations since the impact of the straight-line method of
accounting is not included in our determination of adjusted funds from
operations. (For additional information regarding funds from operations and adjusted
funds from operations, which are non-GAAP measures, see Item 7. Managements
Discussion and Analysis of Financial Condition and Results of Operations 
General  Supplemental Non-GAAP Measures.) As of December 31, 2008 we had a
reserve of $10.0 million for the deferred

9

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rent
receivable due from Marketing representing the full amount of the deferred rent
receivable recorded related to the Subject Properties as of that date. We have
not provided a deferred rent receivable reserve related to the Remaining
Properties since, based on our assessments and assumptions, we continue to
believe that it is probable that we will collect the deferred rent receivable
related to the Remaining Properties of $22.9 million as of December 31, 2008
and that Lukoil will not allow Marketing to fail to perform its rental,
environmental and other obligations under the Marketing Leases.

Marketing
is directly responsible to pay for (i) remediation of environmental
contamination it causes and compliance with various environmental laws and
regulations as the operator of our properties, and (ii) known and unknown
environmental liabilities allocated to Marketing under the terms of the Master
Lease and various other agreements between Marketing and us relating to Marketings
business and the properties subject to the Marketing Leases (collectively the
Marketing Environmental Liabilities). We may ultimately be responsible to
directly pay for Marketing Environmental Liabilities as the property owner if
Marketing fails to pay them. Additionally, we will be required to accrue for
Marketing Environmental Liabilities if we determine that it is probable that
Marketing will not meet its obligations or if our assumptions regarding the
ultimate allocation methods and share of responsibility that we used to
allocate environmental liabilities changes as a result of the factors discussed
above, or otherwise. However, we continue to believe that it is not probable
that Marketing will not pay for substantially all of the Marketing Environmental
Liabilities since we believe that Lukoil will not allow Marketing to fail to
perform its rental, environmental and other obligations under the Marketing
Leases and, accordingly, we did not accrue for the Marketing Environmental
Liabilities as of December 31, 2008 or December 31, 2007. Nonetheless, we have
determined that the aggregate amount of the Marketing Environmental Liabilities
(as estimated by us based on our assumptions and analysis of information
currently available to us) could be material to us if we were required to
accrue for all of the Marketing Environmental Liabilities in the future since
we believe that it is reasonably possible that as a result of such accrual, we
may not be in compliance with the existing financial covenants in our Credit
Agreement. Such non-compliance could result in an event of default which, if
not cured or waived, could result in the acceleration of all of our
indebtedness under the Credit Agreement.

Should
our assessments, assumptions and beliefs prove to be incorrect, or if
circumstances change, the conclusions we reached may change relating to (i)
whether some or all of the Subject or Remaining Properties are likely to be
removed from the Marketing Leases (ii) recoverability of the deferred rent receivable
for some or all of the Subject or Remaining Properties, (iii) potential
impairment of the Subject or Remaining Properties, and (iv) Marketings ability
to pay the Marketing Environmental Liabilities. We intend to regularly review
our assumptions that affect the accounting for deferred rent receivable;
long-lived assets; environmental litigation accruals; environmental remediation
liabilities; and related recoveries from state underground storage tank funds,
which may result in material adjustments to the amounts recorded for these
assets and liabilities, and as a result of which, we may not be in compliance
with the financial covenants in our Credit Agreement. Accordingly, we may be
required to (i) reserve additional amounts of the deferred rent receivable
related to the Remaining Properties, (ii) record an impairment charge related
to the Subject or Remaining Properties, or (iii) accrue for Marketing
Environment Liabilities as a result of the potential or actual modification of
the Marketing Leases or other factors.

We
cannot provide any assurance that Marketing will continue to pay its debts or
meet its rental, environmental or other obligations under the Marketing Leases
prior or subsequent to any potential modification to the Marketing Leases. In
the event that Marketing cannot or will not perform its rental, environmental
or other obligations under the Marketing Leases; if the Marketing Leases are
modified significantly or terminated; if we determine that it is probable that
Marketing will not meet its environmental obligations and we accrue for such
liabilities; if we are unable to promptly re-let or sell the properties subject
to the Marketing Leases; or if we change our assumptions that affect the
accounting for rental revenue or Marketing Environmental Liabilities related to
the Marketing Leases and various other agreements; our business, financial
condition, revenues, operating expenses, results of operations, liquidity,
ability to pay dividends and/or stock price may be materially adversely
affected.

Substantially all of
our tenants depend on the same industry for their revenues.

We
derive substantially all of our revenues from leasing, primarily on a
triple-net basis, retail motor fuel and convenience store properties and petroleum
distribution terminals to tenants in the petroleum marketing industry.
Accordingly, our revenues will be dependent on the economic success of the
petroleum marketing industry, and any factors that adversely affect that
industry could also have a material adverse effect on our business, financial

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condition and
results of operations liquidity, ability to pay dividends and/or stock price.
The success of participants in that industry depends upon the sale of refined
petroleum products at margins in excess of fixed and variable expenses. A
large, rapid increase in wholesale petroleum prices would adversely affect the
profitability and cash flows of Marketing and our other tenants if the
increased cost of petroleum products could not be passed on to their customers
or if automobile consumption of gasoline were to decline significantly.
Petroleum products are commodities, the prices of which depend on numerous
factors that affect the supply of and demand for petroleum products. The prices
paid by Marketing and other petroleum marketers for products are affected by
global, national and regional factors. We cannot be certain how these factors
will affect petroleum product prices or supply in the future, or how in
particular they will affect Marketing or our other tenants.

Our future cash flow
is dependent on the performance of our tenants of their lease obligations,
renewal of existing leases and either re-letting or
selling our vacant
properties.

We
are subject to risks that financial distress or default of our existing tenants
may lead to vacancy at our properties or disruption in rent receipts as a
result of partial payment or nonpayment of rent or that expiring leases may not
be renewed. Under unfavorable general economic conditions, there can be no
assurance that our tenants level of sales and financial performance generally
will not be adversely affected, which in turn, could impact the reliability of
our rent receipts. We are subject to risks that the terms of renewal or
re-letting our properties (including the cost of required renovations,
replacement of gasoline tanks and related equipment or environmental
remediation) may be less favorable than current lease terms, or that the values
of our properties that we sell may be adversely affected by unfavorable general
economic conditions. Unfavorable general economic conditions may also
negatively impact our ability to re-let or sell our properties. Numerous
properties compete with our properties in attracting tenants to lease space.
The number of available or competitive properties in a particular area could
have a material adverse effect on our ability to lease or sell our properties
and on the rents charged.

In
addition to the risk of disruption in rent receipts, we are subject to the risk
of incurring real estate taxes, maintenance, environmental and other expenses
at vacant properties. The financial distress or default of our tenants may also
lead to protracted, more complex, expensive or burdensome processes for
retaking control of our properties than would otherwise be the case, including
as a possible consequence of bankruptcy, eviction or other legal proceedings
related to or resulting from the tenants default. These risks are greater with
respect to certain of our tenants who lease multiple properties from us, such
as Marketing. (For additional information with respect to concentration of
tenant risk, see Item 7. Managements Discussion and Analysis of Financial
Condition and Results of Operations  General  Developments Related to
Marketing and the Marketing Leases.)

If
our tenants do not perform their lease obligations, or we were unable to renew
existing leases and promptly recapture and re-let or sell vacant locations; or
if lease terms upon renewal or re-letting were less favorable than current
lease terms, or if the values of properties that we sell are adversely affected
by market conditions; or if we incur significant costs or disruption related to
or resulting from tenant financial distress, bankruptcy or default; our cash
flow could be significantly adversely affected.

Property taxes on
our properties may increase without notice.

Each
of the properties we own or lease is subject to real property taxes. The leases
for certain of the properties that we lease from third parties obligate us to
pay real property taxes with regard to those properties. The real property
taxes on our properties and any other properties that we develop, acquire or
lease in the future may increase as property tax rates change and as those
properties are assessed or reassessed by tax authorities. To the extent that
our tenants are unable or unwilling to pay such increase in accordance with
their leases, our net operating expenses may increase.

We have incurred,
and may continue to incur, operating costs as a result of
environmental laws and
regulation, which could reduce our profitability.

The
real estate business and the petroleum products industry are subject to
numerous federal, state and local laws and regulations, including matters
relating to the protection of the environment. Under certain environmental
laws, a current or previous owner or operator of real estate may be liable for
contamination resulting from the presence or discharge of hazardous or toxic
substances or petroleum products at, on, or under, such property, and may be

11

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required to
investigate and clean-up such contamination. Such laws typically impose
liability and clean-up responsibility without regard to whether the owner or
operator knew of or caused the presence of the contaminants, or the timing or
cause of the contamination, and the liability under such laws has been
interpreted to be joint and several unless the harm is divisible and there is a
reasonable basis for allocation of responsibility. For example, liability may
arise as a result of the historical use of a property or from the migration of
contamination from adjacent or nearby properties. Any such contamination or
liability may also reduce the value of the property. In addition, the owner or
operator of a property may be subject to claims by third parties based on
injury, damage and/or costs, including investigation and clean-up costs,
resulting from environmental contamination present at or emanating from a
property. The properties owned or controlled by us are leased primarily as
retail motor fuel and convenience store properties, and therefore may contain,
or may have contained, USTs for the storage of petroleum products and other
hazardous or toxic substances, which creates a potential for the release of
such products or substances. Some of our properties may be subject to
regulations regarding the retirement and decommissioning or removal of
long-lived assets including buildings containing hazardous materials, USTs and
other equipment. Some of the properties may be adjacent to or near properties
that have contained or currently contain USTs used to store petroleum products
or other hazardous or toxic substances. In addition, certain of the properties
are on, adjacent to, or near properties upon which others have engaged or may
in the future engage in activities that may release petroleum products or other
hazardous or toxic substances. There may be other environmental problems
associated with our properties of which we are unaware. These problems may make
it more difficult for us to re-let or sell our properties on favorable terms,
or at all.

For
additional information with respect to pending environmental lawsuits and
claims, environmental remediation costs and estimates, and developments related
to Marketing and the Marketing Leases see Item 3. Legal Proceedings,
Environmental Matters and General  Developments Related to Marketing and
the Marketing Leases in Item 7. Managements Discussion and Analysis of
Financial Condition and Results of Operations and Note 5 in Item 8. Financial
Statements and Supplementary Data - Notes to Consolidated Financial Statements
each of which is incorporated by reference herein.

We
enter into leases and various other agreements which allocate responsibility
for known and unknown environmental liabilities by establishing the percentage
and method of allocating responsibility between the parties. Our tenants are
directly responsible to pay for (i) remediation of environmental contamination
they cause and compliance with various environmental laws and regulations as
the operators of our properties, and (ii) environmental liabilities allocated
to our tenants under the terms of our leases and various other agreements
between our tenants and us. Generally, the liability for the retirement and
decommissioning or removal of USTs and other equipment is the responsibility of
our tenants. We are contingently liable for these obligations in the event that
our tenants do not satisfy their responsibilities. A liability has not been
accrued for obligations that are the responsibility of our tenants based on our
tenants past histories of paying such obligations and/or our assessment of
their respective financial abilities to pay their share of such costs. However,
there can be no assurance that our assessments are correct or that our tenants
who have paid their obligations in the past will continue to do so.

We
have not accrued for approximately $1.0 million in costs allegedly incurred by
the current property owner in connection with removal of USTs and soil
remediation at a property that was leased to and operated by Marketing. We
believe that Marketing is responsible for such costs under the terms of the
Master Lease, and have tendered the matter for defense and indemnification from
Marketing, but Marketing had denied its liability for claims and its
responsibility to defend against, and indemnify us, for the claim. We have
filed third party claims against Marketing for indemnification in this matter,
which claim is currently being actively litigated. It is reasonably possible
that our assumption that Marketing will be ultimately responsible for the claim
may change, which may result in our providing an accrual for this and other matters.

It
is possible that our assumptions regarding the ultimate allocation methods and
share of responsibility that we used to allocate environmental liabilities may
change, which may result in adjustments to the amounts recorded for environmental
litigation accruals, environmental remediation liabilities and related assets.
We will be required to accrue for environmental liabilities that we believe are
allocable to others under various other agreements if we determine that it is
probable that the counter-party will not meet its environmental obligations. We
may ultimately be responsible to directly pay for environmental liabilities as
the property owner if the counterparty fails to pay them.

12

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We cannot
predict what environmental legislation or regulations may be enacted in the
future, or if or how existing laws or regulations will be administered or
interpreted with respect to products or activities to which they have not
previously been applied. We cannot predict whether state UST fund programs will
be administered and funded in the future in a manner that is consistent with
past practices and if future environmental spending will continue to be
eligible for reimbursement at historical recovery rates under these programs.
Compliance with more stringent laws or regulations, as well as more vigorous
enforcement policies of the regulatory agencies or stricter interpretation of
existing laws which may develop in the future, could have an adverse effect on
our financial position, or that of our tenants, and could require substantial
additional expenditures for future remediation.

As a result
of the factors discussed above, or others, compliance with environmental laws
and regulations could have a material adverse effect on our business, financial
condition, results of operations, liquidity, ability to pay dividends and/or
stock price.

We are defending
pending lawsuits and claims and are subject to material
losses.

We are subject
to various lawsuits and claims, including litigation related to environmental
matters, damages resulting from leaking USTs and toxic tort claims. The
ultimate resolution of certain matters cannot be predicted because considerable
uncertainty exists both in terms of the probability of loss and the estimate of
such loss. Our ultimate liabilities resulting from such lawsuits and claims, if
any, could cause a material adverse effect on our business, financial
condition, results of operations, liquidity, ability to pay dividends and/or
stock price. (For additional information with respect to pending lawsuits and
claims see Item 3. Legal Proceedings.)

A significant
portion of our properties are concentrated in the Northeast and
Mid-Atlantic regions of
the United States, and adverse conditions in those regions, in particular, could
negatively impact our operations.

A
significant portion of the properties we own and lease are located in the
Northeast and Mid-Atlantic regions of the United States. Because of the
concentration of our properties in those regions, in the event of adverse
economic conditions in those regions, we would likely experience higher risk of
default on payment of rent payable to us (including under the Marketing Leases)
than if our properties were more geographically diversified. Additionally, the
rents on our properties may be subject to a greater risk of default than other
properties in the event of adverse economic, political, or business
developments or natural hazards that may affect the Northeast or Mid-Atlantic
United States and the ability of our lessees to make rent payments. This lack
of geographical diversification could have a material adverse effect on our
business, financial condition, results of operations, liquidity, ability to pay
dividends and/or stock price.

We are in a
competitive business.

The real
estate industry is highly competitive. Where we own properties, we compete for
tenants with a large number of real estate property owners and other companies
that sublet properties. Our principal means of competition are rents charged in
relation to the income producing potential of the location. In addition, we
expect other major real estate investors, some with much greater resources than
us, will compete with us for attractive acquisition opportunities. These
competitors include petroleum manufacturing, distributing and marketing
companies, other REITs, investment banking firms and private institutional
investors. This competition has increased prices for commercial properties and
may impair our ability to make suitable property acquisitions on favorable
terms in the future.

We are exposed to
counterparty credit risk and there can be no assurances that we will manage or
mitigate this risk effectively.

We
regularly interact with counterparties in various industries. The types of
counterparties most common to our transactions and agreements include, but are
not limited to, landlords, tenants, vendors and lenders. Our most significant
counterparties include, but are not limited to, Marketing as our primary
tenant, the members of the Bank Syndicate that are counterparties to our Credit
Agreement as our primary source of financing and JPMorgan Chase as the
counterparty to our interest rate Swap Agreement. The default, insolvency or
other inability of a significant counterparty to perform its obligations under
an agreement or transaction, including, without limitation, as a result of the
rejection of an agreement or transaction in bankruptcy proceedings, could have
a material adverse effect on

13

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us. (For additional information with respect to, and definitions of,
the Bank Syndicate, the Credit Agreement and the Swap Agreement, see Item 7.
Managements Discussion and Analysis of Financial Condition and Results of
Operations - Liquidity and Capital Resources and Item 7A. Quantitative and
Qualitative Disclosures About Market Risks.)

We may acquire or
develop new properties, and this may create risks.

We may
acquire or develop properties or acquire other real estate companies when we
believe that an acquisition or development matches our business strategies. We
may not succeed in consummating desired acquisitions or in completing
developments on time or within our budget. We also may not succeed in leasing
newly developed or acquired properties at rents sufficient to cover their costs
of acquisition or development and operations.

We are subject to
losses that may not be covered by insurance.

Marketing,
and other tenants, as the lessees of our properties, are required to provide
insurance for such properties, including casualty, liability, fire and extended
coverage in amounts and on other terms as set forth in our leases. We carry
insurance against certain risks and in such amounts as we believe are customary
for businesses of our kind. However, as the costs and availability of insurance
change, we may decide not to be covered against certain losses (such as certain
environmental liabilities, earthquakes, hurricanes, floods and civil disorder)
where, in the judgment of management, the insurance is not warranted due to
cost or availability of coverage or the remoteness of perceived risk. There is
no assurance that our insurance against loss will be sufficient. The
destruction of, or significant damage to, or significant liabilities arising
out of conditions at, our properties due to an uninsured cause would result in
an economic loss and could result in us losing both our investment in, and
anticipated profits from, such properties. When a loss is insured, the coverage
may be insufficient in amount or duration, or a lessees customers may be lost,
such that the lessee cannot resume its business after the loss at prior levels
or at all, resulting in reduced rent or a default under its lease. Any such
loss relating to a large number of properties could have a material adverse
effect on our business, financial condition, results of operations, liquidity,
ability to pay dividends and/or stock price.

Failure to qualify
as a REIT under the federal income tax laws would have
adverse consequences to
our shareholders.

We elected
to be treated as a REIT under the federal income tax laws beginning January 1,
2001. We cannot, however, guarantee that we will continue to qualify in the
future as a REIT. We cannot give any assurance that new legislation,
regulations, administrative interpretations or court decisions will not
significantly change the requirements relating to our qualification. If we fail
to qualify as a REIT, we will again be subject to federal income tax at regular
corporate rates, we could be subject to the federal alternative minimum tax, we
would be required to pay significant income taxes and we would have less money
available for our operations and distributions to shareholders. This would
likely have a significant adverse effect on the value of our securities. We
could also be precluded from treatment as a REIT for four taxable years
following the year in which we lost the qualification, and all distributions to
stockholders would be taxable as regular corporate dividends to the extent of
our current and accumulated earnings and profits. Loss of our REIT status would
result in an event of default that, if not cured or waived, could result in the
acceleration of all of our indebtedness under our Credit Agreement which could
have a material adverse effect on our business, financial condition, results of
operations, liquidity, ability to pay dividends and/or stock price.

In 2004, we received
a comment letter from the Securities and Exchange Commission that contains one
comment that remains unresolved.

One comment
remains unresolved as part of a periodic review commenced in 2004 by the
Division of Corporation Finance of the Securities and Exchange Commission (the
SEC) of our Annual Report on Form 10-K for the year ended December 31, 2003
pertaining to the SECs position that we must include the financial statements
and summarized financial data of Marketing in our periodic filings, which
Marketing contends is prohibited by the terms of the Master Lease. In June
2005, the SEC indicated that, unless we file Marketings financial statements
and summarized financial data with our periodic reports: (i) it will not
consider our Annual Reports on Forms 10-K for the years beginning with fiscal
2000 to be compliant; (ii) it will not consider us to be current in our
reporting

14

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requirements; (iii) it will not be in a position to declare effective
any registration statements we may file for public offerings of our securities;
and (iv) we should consider how the SECs conclusion impacts our ability to
make offers and sales of our securities under existing registration statements
and if we have a liability for such offers and sales made pursuant to
registration statements that did not contain the financial statements of
Marketing. We have had no communication with the SEC since 2005. We cannot
accurately predict the consequences if we are ultimately unable to resolve this
outstanding comment.

We are dependent on
external sources of capital which may not be available on favorable terms, if at
all.

We are
dependent on external sources of capital to maintain our status as a REIT and
must distribute to our shareholders each year at least ninety percent of our
net taxable income, excluding any net capital gain. Because of these
distribution requirements, it is not likely that we will be able to fund all
future capital needs, including acquisitions, from income from operations.
Therefore, we will have to continue to rely on third-party sources of capital,
which may or may not be available on favorable terms, or at all. As part of our
overall growth strategy we regularly review opportunities to acquire additional
properties and we expect to continue to pursue acquisitions that we believe
will benefit our financial performance. To the extent that our current sources
of liquidity are not sufficient to fund such acquisitions we will require other
sources of capital, which may or may not be available on favorable terms or at
all. We cannot accurately predict how periods of illiquidity in the credit
markets, such as current market conditions, will impact our access to or cost
of capital. In addition, we may be unable to pursue public equity and debt
offerings until we resolve with the SEC the outstanding comment regarding
disclosure of Marketings financial information. Moreover, additional equity
offerings may result in substantial dilution of shareholders interests, and
additional debt financing may substantially increase our leverage. Our access
to third-party sources of capital depends upon a number of factors including
general market conditions, the markets perception of our growth potential, our
current and potential future earnings and cash distributions, limitations on
future indebtedness imposed under our Credit Agreement and the market price of
our common stock.

The United
States credit markets are currently experiencing an unprecedented contraction.
As a result of the tightening credit markets, we may not be able to obtain additional
financing on favorable terms, or at all. If one or more of the financial
institutions that supports our Credit Agreement fails, we may not be able to
find a replacement, which would negatively impact our ability to borrow under
our the Credit Agreement. In addition, if the current pressures on credit
continue or worsen, we may not be able to refinance our outstanding debt when
due in March 2011, which could have a material adverse effect on us. Subject to
the terms of the Credit Agreement, we have the option to extend the term of the
Credit Agreement for one additional year to March 2012.

Our ability
to meet the financial and other covenants relating to our Credit Agreement may
be dependent on the performance of our tenants, including Marketing. Should our
assessments, assumptions and beliefs that affect our accounting prove to be
incorrect, or if circumstances change, we may have to materially adjust the
amounts recorded in our financial statements for certain assets and
liabilities, and as a result of which, we may not be in compliance with the
financial covenants in our Credit Agreement. We have determined that the
aggregate amount of the Marketing Environmental Liabilities (as estimated by us
based on our assumptions and analysis of information currently available to us)
could be material to us if we were required to accrue for all of the Marketing
Environmental Liabilities in the future since we believe that it is reasonably
possible that as a result of such accrual, we may not be in compliance with the
existing financial covenants in our Credit Agreement. (For additional
information with respect to The Marketing Environmental Liabilities, see Item
7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  General  Developments Related to Marketing and the Marketing
Leases.) If we are not in compliance with one or more of our covenants which,
if not complied with could result in an event of default under our Credit
Agreement, there can be no assurance that our lenders would waive such
non-compliance. A default under our Credit Agreement, if not cured or waived,
whether due to a loss of our REIT status, a material adverse effect on our
business, financial condition or prospects, a failure to comply with financial
and certain other covenants in the Credit Agreement or otherwise, could result
in the acceleration of all of our indebtedness under our Credit Agreement. This
could have a material adverse affect on our business, financial condition,
results of operations, liquidity, ability to pay dividends and/or stock price.

The downturn in the
credit markets has increased the cost of borrowing
and has made financing
difficult to obtain, which may negatively impact our business, and may have a material
adverse effect on us. Lenders may require us to enter into more restrictive
covenants relating to our operations

15

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During 2007, the United States housing and residential lending markets began to
experience accelerating default rates, declining real estate values and
increasing backlog of housing supply. The residential sector issues quickly
spread more broadly into the corporate, asset-backed and other credit and
equity markets and the volatility and risk premiums in most credit and equity
markets have increased dramatically, while liquidity has decreased. These
issues have continued into 2008 and the beginning of  2009. Increasing concerns
regarding the United States and world economic outlook, such as large asset
write-downs at banks, volatility in oil prices, declining business and consumer
confidence and increased unemployment and bankruptcy filings, are compounding
these issues and risk premiums in most capital markets remain near historical
all-time highs. These factors are precipitating generalized credit market
dislocations and a significant contraction in available credit. As a result, it
is becoming increasingly difficult to obtain cost-effective debt capital to
finance new investment activity or to refinance maturing debt, and most lenders
are imposing more stringent restrictions on the terms of credit. Any future
credit agreements or loan documents we execute may contain additional or more
restrictive covenants. The negative impact on the tightening of the credit
markets and continuing credit and liquidity concerns may have a material
adverse effect on our business, financial condition, results of operations,
liquidity, ability to pay dividends and/or stock price. Additionally, there is
no assurance that the increased financing costs, financing with increasingly
restrictive terms or the increase in risk premiums that are demanded by
investors will not have a material adverse effect on us.

Our business
operations may not generate sufficient cash for distributions or
debt service.

There is no
assurance that our business will generate sufficient cash flow from operations
or that future borrowings will be available to us in an amount sufficient to
enable us to make distributions on our common stock, to pay our indebtedness,
or to fund our other liquidity needs. We may not be able to repay or refinance
existing indebtedness on favorable terms, which could force us to dispose of
properties on disadvantageous terms (which may also result in losses) or accept
financing on unfavorable terms.

Borrowings
under our Credit Agreement bear interest at a floating rate. Accordingly, an
increase in interest rates will increase the amount of interest we must pay
under our Credit Agreement and a significant increase in interest rates could also
make it more difficult to find alternative financing on desirable terms. We
have entered into an interest rate swap agreement with a major financial
institution with respect to a portion of our variable rate debt outstanding
under our Credit Agreement. Although the agreement is intended to lessen the
impact of rising interest rates, it also exposes us to the risk that the other
party to the agreement will not perform, the agreement will be unenforceable
and the underlying transactions will fail to qualify as a highly-effective cash
flow hedge for accounting purposes. Further, there can be no assurance that the
use of an interest rate swap will always be to our benefit. While the use of an
interest rate swap agreement is intended to lessen the adverse impact of rising
interest rates, it also conversely limits the positive impact that could be
realized from falling interest rates with respect to the portion of our
variable rate debt covered by the interest rate swap agreement.

We may be unable to
pay dividends and our equity may not appreciate.

Under the
Maryland General Corporation Law, our ability to pay dividends would be
restricted if, after payment of the dividend, (1) we would not be able to pay
indebtedness as it becomes due in the usual course of business or (2) our total
assets would be less than the sum of our liabilities plus the amount that would
be needed, if we were to be dissolved, to satisfy the rights of any
shareholders with liquidation preferences. There currently are no shareholders
with liquidation preferences. No assurance can be given that our financial
performance in the future will permit our payment of any dividends. (For
additional information regarding developments related to Marketing and the
Marketing Leases, see Item 7. Managements Discussion and Analysis of
Financial Condition and Results of Operations  General  Developments Related
to Marketing and the Marketing Leases.) In particular, our Credit Agreement
prohibits the payments of dividends during certain events of default. As a
result of the factors described above, we may experience material fluctuations
in future operating results on a quarterly or annual basis, which could
materially and adversely affect our business, stock price and ability to pay
dividends.

16

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The loss of certain
members of our management team could adversely affect our business.

We depend
upon the skills and experience of our executive officers. Loss of the services
of any of them could have a material adverse effect on our business, financial
condition, results of operations, liquidity, ability to pay dividends and/or
stock price. We do not have employment agreements with any of our executives.

Our accounting
policies and methods are fundamental to how we record and report our financial
position and results of operations, and they require management to make
estimates, judgments and assumptions about matters that are inherently
uncertain.

Our
accounting policies and methods are fundamental to how we record and report our
financial position and results of operations. We have identified several
accounting policies as being critical to the presentation of our financial
position and results of operations because they require management to make
particularly subjective or complex judgments about matters that are inherently
uncertain and because of the likelihood that materially different amounts would
be recorded under different conditions or using different assumptions. Because
of the inherent uncertainty of the estimates, judgments and assumptions
associated with these critical accounting policies, we cannot provide any
assurance that we will not make subsequent significant adjustments to our
consolidated financial statements including those included in this Form 10-K.
Estimates, judgments and assumptions underlying our consolidated financial
statements include, but are not limited to, deferred rent receivable,
recoveries from state UST funds, environmental remediation costs, real estate,
depreciation and amortization, impairment of long-lived assets, litigation,
accrued expenses, income taxes payable and the allocation of the purchase price
of properties acquired to the assets acquired and liabilities assumed. For
example, we have made judgments regarding the level of environmental reserves
and reserves for our deferred rent receivable relating to Marketing and the
Marketing Leases. These judgments and assumptions may prove to be incorrect and
our business, financial condition, revenues, operating expense, results of
operations, liquidity, ability to pay dividends and/or stock price may be
materially adversely affected if that is the case. (For information regarding
our critical accounting policies, see Item 7. Managements Discussion and
Analysis of Financial Condition and Results of Operations - Critical Accounting
Policies.)

Changes in
accounting standards issued by the Financial Accounting Standards Board (the
FASB) or other standard-setting bodies may adversely affect our reported
revenues, profitability or financial position.

Our
financial statements are subject to the application of GAAP, which are
periodically revised and/or expanded. The application of GAAP is also subject
to varying interpretations over time. Accordingly, we are required to adopt new
or revised accounting standards or comply with revised interpretations that are
issued from time-to-time by recognized authoritative bodies, including the FASB
and the SEC. Those changes could adversely affect our reported revenues,
profitability or financial position.

Terrorist attacks
and other acts of violence or war may affect the market on which our common
stock trades, the markets in which we operate, our operations and our results
of operations.

Terrorist
attacks or armed conflicts could affect our business or the businesses of our
tenants or of Marketing or its parent. The consequences of armed conflicts are
unpredictable, and we may not be able to foresee events that could have a
material adverse effect on us. More generally, any of these events could cause
consumer confidence and spending to decrease or result in increased volatility
in the United States and worldwide financial markets and economy. Terrorist
attacks also could be a factor resulting in, or a continuation of, an economic
recession in the United States or abroad. Any of these occurrences could have a
material adverse effect on our business, financial condition, results of
operations, liquidity, ability to pay dividends and/or stock price.

Item 1B. Unresolved Staff
Comments

One comment
remains unresolved as part of a periodic review commenced in 2004 by the
Division of Corporation Finance of the SEC of our Annual Report on Form 10-K
for the year ended December 31, 2003 pertaining to the SECs position that we
must include the financial statements and summarized financial data of
Marketing in our periodic filings, which Marketing contends is prohibited under
the terms of the Master Lease. In

17

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June 2005, the SEC indicated that, unless we file Marketings financial
statements and summarized financial data with our periodic reports: (i) it will
not consider our Annual Reports on Forms 10-K for the years beginning with 2000
to be compliant; (ii) it will not consider us to be current in our reporting
requirements; (iii) it will not be in a position to declare effective any
registration statements we may file for public offerings of our securities; and
(iv) we should consider how the SECs conclusion impacts our ability to make
offers and sales of our securities under existing registration statements and
if we have a liability for such offers and sales made pursuant to registration
statements that did not contain the financial statements of Marketing.

We believe
that the SECs position is based on their interpretation of certain provisions
of their internal Financial Reporting Manual (formerly known as their
Accounting Disclosure Rules and Practices Training Material), Staff Accounting
Bulletin No. 71 and Rule 3-13 of Regulation S-X. We do not believe that any of
this guidance is clearly applicable to our particular circumstances and we
believe that, even if it were, we should be entitled to certain relief from
compliance with such requirements. Marketing generally subleases our properties
to independent, individual service station/convenience store operators
(subtenants). Consequently, we believe that
we, as the owner of these properties and the Getty® brand, could re-let these
properties to the existing subtenants (except for those properties that are vacant) who operate their convenience stores,
automotive repair services or other businesses at our properties, or to other
new or replacement tenants, at market rents although we cannot accurately
predict whether, when, or on what terms, such properties would be re-let or
sold. The SEC did not accept our positions regarding the inclusion of
Marketings financial statements in our filings. We have had no communication
with the SEC since 2005 regarding the unresolved comment. We cannot accurately
predict the consequences if we are unable to resolve this outstanding comment.

We do not
believe that offers or sales of our securities made pursuant to existing
registration statements that did not or do not contain the financial statements
of Marketing constitute, by reason of such omission, a violation of the
Securities Act of 1933, as amended, or the Exchange Act. Additionally, we
believe that if there ultimately is a determination that such offers or sales,
by reason of such omission, resulted in a violation of those securities laws,
we would not have any material liability as a consequence of any such
determination.

Item 2. Properties

Nearly all
of our properties are leased or sublet to distributors and retailers engaged in
the sale of gasoline and other motor fuel products, convenience store products
and automotive repair services who are responsible for the payment of taxes,
maintenance, repair, insurance and other operating expenses and for managing
the actual operations conducted at these properties. Approximately twenty of our
properties are directly leased by us to others under similar lease terms
primarily for other uses such as fast food restaurants, automobile sales and
other retail purposes. In those instances where we determine that the highest
and best use for our properties is no longer a retail motor fuel outlet, we
will seek alternative tenants or buyers for such properties as opportunities
arise.

The
following table summarizes the geographic distribution of our properties at
December 31, 2008. The table also identifies the number and location of
properties we lease from third-parties and which Marketing leases from us under
the Marketing Leases. In addition, we lease four thousand square feet of office
space at 125 Jericho Turnpike, Jericho, New York, which is used for our
corporate headquarters, which we believe will remain suitable and adequate for
such purposes for the immediate future.

18

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|               |  |                          |  |                        |  |                      |  |                |     |  |                      |  |  |                      |  |  |  |  |    |  |  |  |  |       |  |  |  |  |       |   | 
|-------------- |  | ------------------------ |  | ---------------------- |  | -------------------- |  | -------------- | --- |  | -------------------- |  |  | -------------------- |  |  |  |  | -- |  |  |  |  | ----- |  |  |  |  | ----- | - | 
|               |  | OWNED BY GETTY REALTY    |  | LEASED BY GETTY REALTY |  |                      |  |                |     |  |                      | 
|               |  |                          |  |                        |  | TOTAL                |  | PERCENT        |     | 
|               |  | MARKETING
 AS TENANT (1) |  | OTHER
 TENANTS         |  | MARKETING
 AS TENANT |  | OTHER
 TENANTS |     |  | PROPERTIES
 BY STATE |  |  | OF TOTAL
 PROPERTIES |  | 
|               |  |                          |  |                        |  |                      |  |                |     |  |                      |  |  |                     
|New York       |  |                          |  | 236                    |  |                      |  |                | 31  |  |                      |  |  | 70                   |  |  |  |  | 5  |  |  |  |  | 342   |  |  |  |  | 32.3  | % | 
|Massachusetts  |  |                          |  | 127                    |  |                      |  |                | 1   |  |                      |  |  | 23                   |  |  |  |  |   |  |  |  |  | 151   |  |  |  |  | 14.2  |   | 
|New Jersey     |  |                          |  | 106                    |  |                      |  |                | 9   |  |                      |  |  | 24                   |  |  |  |  | 5  |  |  |  |  | 144   |  |  |  |  | 13.6  |   | 
|Pennsylvania   |  |                          |  | 107                    |  |                      |  |                | 5   |  |                      |  |  | 3                    |  |  |  |  | 4  |  |  |  |  | 119   |  |  |  |  | 11.3  |   | 
|Connecticut    |  |                          |  | 59                     |  |                      |  |                | 29  |  |                      |  |  | 16                   |  |  |  |  | 9  |  |  |  |  | 113   |  |  |  |  | 10.7  |   | 
|Virginia       |  |                          |  | 4                      |  |                      |  |                | 24  |  |                      |  |  | 8                    |  |  |  |  | 1  |  |  |  |  | 37    |  |  |  |  | 3.5   |   | 
|New Hampshire  |  |                          |  | 25                     |  |                      |  |                | 3   |  |                      |  |  | 3                    |  |  |  |  |   |  |  |  |  | 31    |  |  |  |  | 2.9   |   | 
|Maine          |  |                          |  | 17                     |  |                      |  |                | 1   |  |                      |  |  | 3                    |  |  |  |  | 1  |  |  |  |  | 22    |  |  |  |  | 2.1   |   | 
|Rhode Island   |  |                          |  | 15                     |  |                      |  |                | 1   |  |                      |  |  | 3                    |  |  |  |  |   |  |  |  |  | 19    |  |  |  |  | 1.8   |   | 
|Texas          |  |                          |  |                       |  |                      |  |                | 17  |  |                      |  |  |                     |  |  |  |  |   |  |  |  |  | 17    |  |  |  |  | 1.6   |   | 
|Delaware       |  |                          |  | 9                      |  |                      |  |                | 1   |  |                      |  |  | 1                    |  |  |  |  |   |  |  |  |  | 11    |  |  |  |  | 1.0   |   | 
|North Carolina |  |                          |  |                       |  |                      |  |                | 11  |  |                      |  |  |                     |  |  |  |  |   |  |  |  |  | 11    |  |  |  |  | 1.0   |   | 
|Hawaii         |  |                          |  |                       |  |                      |  |                | 10  |  |                      |  |  |                     |  |  |  |  |   |  |  |  |  | 10    |  |  |  |  | 0.9   |   | 
|Maryland       |  |                          |  | 4                      |  |                      |  |                | 3   |  |                      |  |  |                     |  |  |  |  | 2  |  |  |  |  | 9     |  |  |  |  | 0.8   |   | 
|California     |  |                          |  |                       |  |                      |  |                | 8   |  |                      |  |  |                     |  |  |  |  | 1  |  |  |  |  | 9     |  |  |  |  | 0.8   |   | 
|Florida        |  |                          |  |                       |  |                      |  |                | 6   |  |                      |  |  |                     |  |  |  |  |   |  |  |  |  | 6     |  |  |  |  | 0.6   |   | 
|Arkansas       |  |                          |  |                       |  |                      |  |                | 3   |  |                      |  |  |                     |  |  |  |  |   |  |  |  |  | 3     |  |  |  |  | 0.3   |   | 
|Illinois       |  |                          |  |                       |  |                      |  |                | 2   |  |                      |  |  |                     |  |  |  |  |   |  |  |  |  | 2     |  |  |  |  | 0.2   |   | 
|Ohio           |  |                          |  |                       |  |                      |  |                | 2   |  |                      |  |  |                     |  |  |  |  |   |  |  |  |  | 2     |  |  |  |  | 0.2   |   | 
|North Dakota   |  |                          |  |                       |  |                      |  |                | 1   |  |                      |  |  |                     |  |  |  |  |   |  |  |  |  | 1     |  |  |  |  | 0.1   |   | 
|Vermont        |  |                          |  | 1                      |  |                      |  |                |    |  |                      |  |  |                     |  |  |  |  |   |  |  |  |  | 1     |  |  |  |  | 0.1   |   | 
|               |  |                          |  |                        |  |                      |  |                |     |  |                      |  |  |                      |  |  |  |  |    |  |  |  |  |       |  |  |  |  |       |   | 
|Total          |  |                          |  | 710                    |  |                      |  |                | 168 |  |                      |  |  | 154                  |  |  |  |  | 28 |  |  |  |  | 1,060 |  |  |  |  | 100.0 | % | 
|               |  |                          |  |                        |  |                      |  |                |     |  |                      |  |  |                      |  |  |  |  |    |  |  |  |  |       |  |  |  |  |       |   | 
|               |  |                          |  |                        |  |                      |  |                |     |  |                      |  |  |                      |  |  | 

|    |                                                                                                
|--- | -----------------------------------------------------------------------------------------------
|(1) | Includes nine terminal properties
 owned in New York, New Jersey, Connecticut and Rhode Island.

The
properties that we lease have a remaining lease term, including renewal option
terms, averaging over ten years. The following table sets forth information
regarding lease expirations, including renewal and extension option terms, for
properties that we lease from third parties:

|               |  |                             |  |                                       |  |                               |  |  |       |   |  |  |  |       |   | 
|-------------- |  | --------------------------- |  | ------------------------------------- |  | ----------------------------- |  |  | ----- | - |  |  |  | ----- | - | 
|CALENDAR
 YEAR |  | NUMBER OF
 LEASES
 EXPIRING |  | PERCENT
 OF TOTAL
 LEASED
 PROPERTIES |  | PERCENT
 OF TOTAL
 PROPERTIES | 
|               |  |                             |  |                                       |  |                               | 
|2009           |  |                             |  | 17                                    |  |                               |  |  | 9.34  | % |  |  |  | 1.60  | % | 
|2010           |  |                             |  | 9                                     |  |                               |  |  | 4.95  |   |  |  |  | 0.85  |   | 
|2011           |  |                             |  | 10                                    |  |                               |  |  | 5.49  |   |  |  |  | 0.94  |   | 
|2012           |  |                             |  | 13                                    |  |                               |  |  | 7.14  |   |  |  |  | 1.23  |   | 
|2013           |  |                             |  | 5                                     |  |                               |  |  | 2.75  |   |  |  |  | 0.47  |   | 
|               |  |                             |  |                                       |  |                               |  |  |       |   |  |  |  |       |   | 
|Subtotal       |  |                             |  | 54                                    |  |                               |  |  | 29.67 |   |  |  |  | 5.09  |   | 
|Thereafter     |  |                             |  | 128                                   |  |                               |  |  | 70.33 |   |  |  |  | 12.08 |   | 
|               |  |                             |  |                                       |  |                               |  |  |       |   |  |  |  |       |   | 
|Total          |  |                             |  | 182                                   |  |                               |  |  | 100.0 | % |  |  |  | 17.17 | % | 
|               |  |                             |  |                                       |  |                               |  |  |       |   |  |  |  |       |   | 

We
have rights-of-first refusal to purchase or lease one hundred forty-four of the
properties we lease. Although there can be no assurance regarding any
particular property, historically we generally have been successful in renewing
or entering into new leases when lease terms expire. Approximately 65% of our
leased properties are subject to automatic renewal or extension options.

In
the opinion of our management, our owned and leased properties are adequately
covered by casualty and liability insurance. In addition, we require our
tenants to provide insurance for all properties they lease from us, including
casualty, liability, fire and extended coverage in amounts and on other terms
satisfactory to us. We have no plans for material improvements to any of our
properties. However, our tenants frequently make improvements to the properties
leased from us at their expense. We are not aware of any material liens or
encumbrances on any of our properties.

We lease
eight hundred fifty-five retail motor fuel and convenience store properties and
nine petroleum distribution terminals to Marketing under the Marketing Leases.
The Master Lease is a unitary lease and has an initial term expiring in 2015,
and generally provides Marketing with three renewal options of ten years each
and a final renewal option of three years and ten months extending to 2049.
Each of the renewal options may be exercised

19

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only on an all or nothing basis. The Marketing Leases are
triple-net leases, under which Marketing is responsible for the payment of
taxes, maintenance, repair, insurance and other operating expenses. As
permitted under the terms of our leases with Marketing, Marketing can generally
use each property for any lawful purpose, or for no purpose whatsoever. We
believe that as of December 31, 2008, Marketing had vacancies and/or removed
the gasoline tanks and related equipment at what may be as much as 10% or more
of the properties subject to the Marketing Leases. (For additional information
regarding developments related to Marketing and the Marketing Leases, see Item
7. Managements Discussion and Analysis of Financial Condition and Results of
Operations  General  Developments Related to Marketing and the Marketing
Leases.)

If
Marketing fails to pay rent, taxes or insurance premiums when due under the
Marketing Leases and the failure is not cured by Marketing within a specified
time after receipt of notice, we have the right to terminate the Marketing
Leases and to exercise other customary remedies against Marketing. If Marketing
fails to comply with any other obligation under the Master Lease after notice
and opportunity to cure, we do not have the right to terminate the Master
Lease. In the event of Marketings default where we do not have the right to
terminate the Master Lease, our available remedies under the Master Lease are
to seek to obtain an injunction or other equitable relief requiring Marketing
to comply with its obligations under the Master Lease and to recover damages
from Marketing resulting from the failure. If any lease we have with a
third-party landlord for properties that we lease to Marketing is terminated as
a result of our default and the default is not caused by Marketing, we have
agreed to indemnify Marketing for its losses with respect to the termination.
Marketing has the right-of-first refusal to purchase any property leased to
Marketing under the Marketing Leases that we decide to sell.

We have
also agreed to provide limited environmental indemnification to Marketing,
capped at $4.25 million and expiring in 2010, for certain pre-existing
conditions at six of the terminals we own and lease to Marketing. Under the
agreement, Marketing is obligated to pay the first $1.5 million of costs and
expenses incurred in connection with remediating any pre-existing terminal
condition, Marketing will share equally with us the next $8.5 million of those
costs and expenses and Marketing is obligated to pay all additional costs and
expenses over $10.0 million. We have accrued $0.3 million as of December 31,
2008 and 2007 in connection with this indemnification agreement. Under the
Master Lease, we continue to have additional ongoing environmental remediation
obligations for one hundred eighty-seven scheduled sites and our agreements
with Marketing provide that Marketing otherwise remains liable for all
environmental matters. (For additional information regarding developments related
to Marketing and the Marketing Leases, see Item 7. Managements Discussion and
Analysis of Financial Condition and Results of Operations  General 
Developments Related to Marketing and the Marketing Leases.)

Item 3. Legal Proceedings

In 1989, we
were named as a defendant in a lawsuit by multiple owners of adjacent
properties seeking compensatory and punitive damages for personal injury and
property damages alleging that a leak of an underground storage tank occurred
in November 1985 at one of our retail motor fuel properties. The action is
still pending in New York Supreme Court, Suffolk County, remains in the
pleadings stage and has remained dormant for more than twelve years.

In 1991,
the State of New York brought an action in the New York State Supreme Court in
Albany against our former heating oil subsidiary seeking reimbursement for
cleanup costs claimed to have been incurred at a retail motor fuel property in
connection with a gasoline release. The State is also seeking penalties plus
interest. We answered the complaint by denying liability and also asserted
cross-claims against another defendant. There had been no activity in this
proceeding for approximately eight years prior to January 2002 when we received
a letter from the States attorney indicating that the State intends to
continue prosecuting the action. To date, we are not aware that the State has
taken any additional actions in connection with this claim.

In 1997, an
action was commenced in the New York Supreme Court in Schenectady, naming us as
defendants, and seeking to recover monetary damages for personal injuries
allegedly suffered from the release of petroleum and vapors from one of our
retail motor fuel properties. This action has not been pursued by the plaintiff
for more than ten years.

20

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In 1997,
representatives of the County of Lancaster, Pennsylvania contacted the Company
regarding alleged petroleum contamination of property owned by the County
adjoining a property owned by the Company. No litigation has been instituted as
a result of this potential claim. Negotiations with the County have, however,
have been ongoing since commencement of this action in an effort to reach an
amicable resolution. In 2005, the County requested reimbursement of legal fees
pursuant to an access agreement between the parties. A substantial portion of
the fees remains in dispute.

In June
1999, an action was commenced against us in the New York Supreme Court in
Richmond County seeking monetary damages for property damage alleged to have
resulted from a petroleum release in connection with a tank removal by our
contractor. After a number of years of inactivity by the plaintiff, in 2006 the
plaintiff reactivated prosecution by filing for a preliminary conference. After
a number of years of inactivity by the plaintiff, in 2006 the plaintiff
reactivated prosecution of its case by filing for a preliminary conference.
Discovery is ongoing.

In 2000, an
action was commenced in New York Supreme Court in Nassau County against us by a
prior landlord to recover damages arising out of a petroleum release and
remediation thereof. The release dates back to 1979 and is listed as closed
by the NYSDEC. The plaintiff has not pursued this case for more than seven
years.

In December
2002, the State of New York commenced an action in the New York Supreme Court
in Albany County against us and Marketing to recover costs claimed to have been
expended by the State to investigate and remediate a petroleum release into the
Ossining River commencing approximately in 1996. This case was settled against
all defendants in June, 2008 in consideration for a payment of an aggregate
amount, of which the Company, for ourselves and on behalf of Marketing (whom we
had agreed to indemnify), paid $53,000.

In February
2003, an action was commenced against us, Marketing and others by the owners of
an adjacent property in the Pennsylvania Court of Common Pleas in Lancaster
County, asserting claims relating to a discharge of gasoline allegedly
emanating from our property. In response to cross motions for summary judgment,
the court denied our motion and granted plaintiffs motion finding us liable
for the petroleum contamination. Plaintiffs counsel has also made demand for
legal fees. The matter was settled by us, for ourselves and on behalf of
Marketing and its subtenant, in July 2008 in consideration for a payment by the
Company of $295,000.

In April
2003, we were named in a complaint seeking class action classification, filed
in the New York Supreme Court in Dutchess County, NY, arising out of alleged
contamination of ground water with methyl tertiary butyl ether (a fuel derived
from methanol, which we refer to as MTBE). We served an answer that denied liability
and asserted affirmative defenses. The plaintiffs have not responded to our
answer and there has been no activity in the case since it was commenced.

In July
2005, the State of Rhode Island Department of Environmental Management (RIDEM)
issued a Notice of Violation (NOV) against the Company and Marketing relating
to a suspected petroleum release at a property that abuts property owned by us
and leased to Marketing. The NOV was appealed by Marketing on behalf of it and
the Company to RIDEMs Administrative Adjudication Division. An evidentiary
hearing on that appeal was held in May, 2008, leading to a final decision
entered by RIDEM in October, 2008. The final decision dismissed the NOV
entirely against Marketing but only partially against the Company, upholding
certain state regulatory violations against one of our subsidiaries and
ordering remediation actions and the payment of an administrative penalty. We
have appealed RIDEMs final decision to the Providence Superior Court.

In July
2003, we received a Request for Reimbursement from the State of Maine
Department of Environmental Protection (MDEP) seeking reimbursement of costs
claimed to have been incurred by it in connection with the remediation of
contamination found at a retail motor fuel property, purportedly linked to
numerous gasoline spills in the late 1980s. We have denied liability for the
claim and not received any data from the State responsive to our requests, the
most recent of which was made in July, 2008, for evidence linking the subject
contamination to our conduct.

In
September 2003, we were notified by the New Jersey Department of Environmental
Protection (the NJDEP) that we may be responsible for damages to natural
resources (NRDs) by reason of a petroleum release at a retail motor fuel
property formerly operated by us in Egg Harbor, NJ. We have remediated the
resulting contamination at the property in accordance with a plan approved by
the NJDEP and continue required sampling of monitoring wells

21

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that were required to be installed. In addition, we have responded to
the notice and met with the Department to determine whether, and to what
extent, we may be responsible for NRDs regarding this property and our other
properties formerly supplied by us with gasoline in New Jersey. Since our
meeting with the NJDEP held shortly after receipt of the notification, we have
had no communication with the NJDEP arising from this matter regarding NRDs.

From
October 2003 through December 2008, we were made a party to fifty-four cases in
Connecticut, Florida, Massachusetts, New Hampshire, New Jersey, New York,
Pennsylvania, Vermont, Virginia, and West Virginia, brought by local water
providers or governmental agencies. These cases allege various theories of
liability due to contamination of groundwater with MTBE as the basis for claims
seeking compensatory and punitive damages. Each case names as defendants
approximately fifty petroleum refiners, manufacturers, distributors and
retailers of MTBE, or gasoline containing MTBE. The accuracy of the allegations
as they relate to us, our defenses to such claims, the aggregate possible
amount of damages, and the method of allocating such amounts among the
remaining defendants have not been determined. We have been dismissed from
certain of the cases initially filed against us. Pursuant to consolidation
procedures under federal law, the various MTBE cases have been transferred to
the Federal District Court for the Southern District of New York for coordinated
Multi-District Litigation proceedings. We are presently named as a defendant in
fifty out of the approximately one hundred cases that are consolidated in the
Multi-District Litigation. The Federal District Court has set apart for initial
process four focus cases from the consolidated cases being heard. Three of
these four focus cases name us as a defendant. One of the focus cases to which
we are a party had been set for trial in September 2008. However, all of the
named defendants in this first focus case, other than us and one other
non-refiner defendant, entered into settlements with certain plaintiffs, which
affected approximately twenty-seven of the cases to which we are a party,
including one of the other initial focus cases. As a result of the multi-party settlement
which affected two of the focus cases, the Court vacated the September 2008
trial date for the first focus case, and further scheduling of trial for the
first focus case and one of the other focus cases to which we are a named
defendant remains open at this time. As a result of this settlement, the
Federal District Court designated an additional focus case for process. We are
a named defendant in this new focus case. Trials in this case and in one of the
original focus cases in which we have been named a defendant are scheduled for
sometime in 2009. We participate in a joint defense group with the goal of
sharing expert and other costs with the other defendants, and we also have
separate counsel defending our interests. We are vigorously defending these
matters.

In November
2003, we received a demand from the State of New York for reimbursement of
cleanup and removal costs claimed to have been incurred by the New York
Environmental Protection and Spill Compensation Fund regarding contamination it
alleges emanated from one of our retail motor fuel properties in 1997. We have
responded to the States demand and have denied responsibility for
reimbursement of such costs. In September 2004, the State of New York commenced
an action against us and others in New York Supreme Court in Albany County
seeking recovery of such costs as well as additional costs and future costs for
remediation and sampling, and interest and penalties. Discovery in this case is
ongoing. We are vigorously defending this matter.

In July
2005, we received a demand from a property owner for reimbursement of cleanup
and soil removal costs, at a former retail motor fuel property located in
Brooklyn, New York formerly supplied by us with gasoline that the owner expects
to incur in connection with the proposed development of its property. The owner
claims that the costs will be reimbursable pursuant to an indemnity agreement
that we entered into with the property owner. Although we have acknowledged
responsibility for the contaminated soil, and have been engaged in the
remediation of the same, we have denied responsibility for the full extent of
the costs estimated to be incurred.

In October
2005, the State of New York commenced an action in the New York Supreme Court
in Albany County against us and Marketing to recover costs claimed to have been
funded by the State to remediate a petroleum release emanating from a property
we acquired in 1999. The seller of the property to us, who is also party to the
action, has agreed to defend and indemnify us (and Marketing) regarding the
release and funds have been escrowed to cover the amount sought to be
recovered. The parties in this action are engaged in discovery proceedings. No
trial date has yet been established.

In December
2005, an action was commenced against us in the Superior Court in Providence,
Rhode Island, by the owner of a pier that is adjacent to one of our terminals
that is leased to Marketing seeking monetary damages of approximately $500,000
representing alleged costs related to the ownership and maintenance of the pier
for the period from January 2003 through September 2005. We have been
vigorously defending against this action.

22

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Additionally, we tendered the matter to Marketing for indemnification
and defense pursuant to the Master Lease. Marketing declined to accept our
tender and has denied liability for the claim. In May, 2008 the US District
Court (to which the case had been removed from state court) granted our motion
for summary judgment against the plaintiff on all claims. The plaintiff has
appealed this decision to the First Circuit Court of Appeals. We intend to
pursue our claim against Marketing for indemnification.

In April
2006, we were added as a defendant in an action in the Superior Court of New
Jersey, Middlesex County, filed by a property owner claiming damages against
multiple defendants for remediation of contaminated soil. The basis for
prosecuting the claim against us is corporate successor liability. The matter
was settled in July 2008 in consideration for a payment by us of $600,000,
which was made in the third quarter of 2008, plus an additional maximum
contingent amount of $40,000 relating to possible future liability for certain
third party claims.

In May 2006,
we were advised (but not yet served) of a third party complaint filed in an
action in the Superior Court of New Jersey, Essex County, against Getty Oil,
Inc. and John Doe Corporations, filed by a property owner seeking to impose
upon third parties (that may include a subsidiary of the Company)
responsibility for damages it may suffer in the action for claims brought
against it under federal environmental laws, the States Spill Act, the States
Water Pollution Act and other theories of liability.

In November
2006, an action was commenced by the New Jersey Schools Corporation (NJSC) in
the Superior Court of New Jersey, Union County seeking reimbursement for costs
of approximately $1.0 million related to the removal of abandoned USTs and
remediation of soil contamination at a retail motor fuel property that was
acquired from us by eminent domain. Prior to the taking, the property was
leased to and operated by Marketing. We tendered the matter to Marketing for
defense and indemnification. Marketing has declined to accept the tender and
has denied liability for the claim. We have filed a compulsory third party
claim against Marketing seeking defense and indemnification. In July 2007,
Marketing filed a claim against the Company seeking defense and indemnification.
(For additional information regarding developments related to Marketing and the
Marketing Leases, see Item 7. Managements Discussion and Analysis of
Financial Condition and Results of Operations  General  Developments Related
to Marketing and the Marketing Leases.)

In May
2007, the Companys subsidiary received a lease default notice from its
sub-landlord pertaining to an alleged underpayment of rent by our subsidiary
for a period of time exceeding fifteen years. In June 2007, the Company
commenced an action against the sub-landlord seeking an injunction that would
preclude the sub-landlord from taking any action to terminate its sublease with
our subsidiary or collect the alleged underpayment of rent. The Court issued
the injunction preventing termination of the sublease pending determination of
the matter. Discovery is ongoing.

In July
2007, subsidiaries of the Company were notified of the commencement of three
actions by the NJDEP seeking Natural Resource Damages (NRDs) arising out of
petroleum releases at properties owned or leased by us. Answers to the
complaints and discovery requests were filed by us in each of these cases. In
September, 2008, we agreed with NJDEP to a stipulation of dismissal of one of
the NRD cases, and in February, 2009, we agreed with NJDEP to a stipulation of
dismissal of another of the NRD cases. In each of these stipulations of
dismissal, the claims raised in the New Jersey State Court action were
dismissed without prejudice to the NJDEPs right to reassert the same claims in
complaints brought in the Federal District Court to be heard in the
Multi-District MTBE cases currently pending against us. The third action
remains pending. We are favorably disposed to entering into a stipulation with
the NJDEP with respect to the final NRD case on the same terms as the other
two, and have been advised by the NJDEP that it intends to do so.

In October
2007, the Company received a demand from the State of New York to pay the costs
allegedly arising from investigation and remediation of petroleum spills that
occurred at a property formerly owned by us and taken by Eminent Domain by the
State of New York in 1991. No formal legal action has yet been commenced by the
State.

In August,
2008, we were notified by the New York Environmental Protection and Spill
Compensation Fund (NY Spill Fund) that we and another party had been named as
allegedly responsible for certain petroleum contamination discovered in 2007.
The claimant in the matter is a property developer who alleges to have incurred
approximately $434,000 in petroleum-related remediation costs as a result of
contamination on its property which

23

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allegedly derive from two reported spills: one dating back to 1995 at
an adjacent site formerly owned by us, and the other occurring in 2006, at an
adjacent site owned by the other respondent named in the action. In September
2008, the same claimant also commenced a lawsuit in the New York State Supreme
Court against us and the other allegedly responsible party to recover damages
based upon the same set of facts. We are vigorously defending the claims
against us and have asserted cross claims against the other party.

In
September 2008, we received a directive from the NJDEP calling for a remedial
investigation and cleanup, by us and other named parties, of petroleum-related
contamination found at a retail motor fuel and auto service property. We did
not own or lease this property, but did supply gas to the operator of this property
in 1985 and 1986. We have responded to the NJDEP and we have tendered the
matter to Marketing for defense and indemnification under the Reorganization
and Distribution Agreement between Getty Petroleum Corp. (n/k/a/ Getty
Properties Corp.) and Marketing dated as of February 1, 1997. However, there
can be no assurance that Marketing will accept responsibility for this matter.
For additional information regarding developments related to Marketing and the
Marketing Leases (as defined below), see Item 7. Managements Discussion and
Analysis of Financial Condition and Results of Operations  General 
Developments Related to Marketing and the Marketing Leases.)

Matters related to our Newark, New Jersey
Terminal and the Lower Passaic River

In September
2003, we received a directive (the Directive) issued by the NJDEP under the
New Jersey Spill Compensation and Control Act. The Directive indicated that we
are one of approximately sixty-six potentially responsible parties for alleged
NRDs resulting from discharges of hazardous substances along the lower Passaic
River (the Lower Passaic River). The Directive alleged, inter alia, that the
recipients thereof must conduct an assessment of the natural resources that
have been injured by the discharges and implement interim compensatory
restoration for the injured natural resources. NJDEP alleges that our liability
arises from alleged discharges originating from our Newark, New Jersey Terminal
site. Chevron/Texaco was also identified in the Directive. We responded to the
Directive by asserting that we were not liable. There has been no material
activity and/or communications by NJDEP with respect to the Directive since
early after its issuance.

Effective
June 22, 2004, the United States Environmental Protection Agency (EPA)
entered into an Administrative Order on Consent (AOC) with 31 parties (some
of which are also named in the Directive) who agreed to fund a portion of the
costs for EPA to perform a Remedial Investigation and Feasibility Study
(RI/FS) for the Lower Passaic River. The RI/FS is intended to address the
investigation and evaluation of alternative remedial actions with respect to
alleged damages to the Lower Passaic River. After being notified by the EPA
that they considered us to be a potentially responsible party, we reserved our
defenses to liability, became a party to an amended AOC, and joined the
Cooperating Parties Group (CPG), which consists of the parties which had
executed the initial AOC and other parties (including Chevron/Texaco). Pursuant
to the amended AOC and subsequent amendments adding additional parties, the CPG
has agreed to take over performance of the RI/FS from EPA. The RI/FS does not
resolve liability issues for remedial work or restoration of, or compensation
for, natural resource damages to the Lower Passaic River, which are not known
at this time. As to such matters, separate proceedings or activities are
currently ongoing.

In a
related action, in December 2005, the State of New Jersey brought suit in the
Superior Court of New Jersey, Law Division, against certain companies which the
State alleges are responsible for pollution of the Passaic River from a former
Diamond Alkali manufacturing plant and seeking recovery of alleged damages
incurred and to be incurred on account of alleged discharges of hazardous
substances to the Passaic River. On February 4, 2009, certain of these
defendants filed third-party complaints against approximately three hundred additional
parties, including us as well as the other members of the CPG, seeking
contribution for a pro-rata share of response costs, cleanup and removal costs,
and other damages.

We have
made a demand upon Chevron/Texaco for indemnity under certain agreements
between the Company and Chevron/Texaco that allocate environmental liabilities
for the Newark Terminal Site between the parties. In response, Chevron/Texaco
has asserted that the proceedings and claims are still not yet developed enough
to determine the extent to which indemnities apply. Our ultimate liability, if
any, in the pending and possible future proceedings pertaining to the Lower
Passaic River is uncertain and subject to numerous contingencies which cannot
be predicted and the outcome of which are not yet known.

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

No matter was submitted to a vote of security holders during the three
months ended December 31, 2008.

24

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PART II

Item 5. Market for Registrants Common
Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Capital Stock

Our common
stock is traded on the New York Stock Exchange (symbol: GTY). There were
approximately 11,000 shareholders of our common stock as of March 2, 2009, of
which approximately 1,400 were holders of record. The price range of our common
stock and cash dividends declared with respect to each share of common stock
during the years ended December 31, 2008 and 2007 was as follows:

|                    |  |              |       |               |   |            |  |   |  |       |  | 
|------------------- |  | ------------ | ----- | ------------- | - | ---------- |  | - |  | ----- |  | 
|                    |  | PRICE
 RANGE |       | CASHDIVIDENDS |  
|                    |  |              |       |              
|PERIOD ENDED        |  | HIGH         |       | LOW           |   | PER
 SHARE | 
|                    |  |              |       |               |   |            |  |   |  |      
|March 31,
 2007     |  | $            | 32.10 |               | $ | 27.80      |  | $ |  | .4550 | 
|June 30,
 2007      |  |              | 30.33 |               |   | 26.17      |  |   |  | .4650 | 
|September
 30, 2007 |  |              | 28.72 |               |   | 23.80      |  |   |  | .4650 | 
|December 31,
 2007  |  |              | 29.23 |               |   | 25.21      |  |   |  | .4650 | 
|March 31,
 2008     |  |              | 28.58 |               |   | 13.33      |  |   |  | .4650 | 
|June 30,
 2008      |  |              | 19.04 |               |   | 14.34      |  |   |  | .4650 | 
|September
 30, 2008 |  |              | 23.12 |               |   | 13.12      |  |   |  | .4700 | 
|December 31,
 2008  |  |              | 22.40 |               |   | 13.35      |  |   |  | .4700 | 
|                    |  |              |       |               |   |            |  |   |  |       |  | 

For
a discussion of potential limitations on our ability to pay future dividends
see Item 7. Managements Discussion and Analysis of Financial Condition and
Results of Operations  Liquidity and Capital Resources.

Issuer Purchases of Equity Securities

None

Sales of Unregistered Securities

None

25

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Stock Performance Graph

We have
chosen as our Peer Group the following companies: Commercial Net Lease Realty,
Entertainment Properties Trust, Realty Income Corp. and Hospitality Properties
Trust. We have chosen these companies as our Peer Group because a substantial
segment of each of their businesses is owning and leasing commercial
properties. We cannot assure you that our stock performance will continue in
the future with the same or similar trends depicted in the graph above. We do
not make or endorse any predictions as to future stock performance.

This
performance graph and related information shall not be deemed filed for the
purposes of Section 18 of the Exchange Act or otherwise subject to the
liability of that Section and shall not be deemed to be incorporated by
reference into any filing that we make under the Securities Act or the Exchange
Act.

(LINE GRAPH)

|                      |  |      |        |      |  |        |  |      |        |      |  |        |  |  |        |  |  |        | 
|--------------------- |  | ---- | ------ | ---- |  | ------ |  | ---- | ------ | ---- |  | ------ |  |  | ------ |  |  | ------ | 
|                      |  | 2003 |        | 2004 |  | 2005   |  | 2006 |        | 2007 |  | 2008   | 
|                      |  |      |        |      |  |        |  |      |        |      |  |        | 
|Getty Realty
 Corp.   |  |      | 100.00 |      |  | 117.15 |  |      | 114.35 |      |  | 143.03 |  |  | 132.08 |  |  | 115.55 | 
|Standard
 & Poors 500 |  |      | 100.00 |      |  | 108.99 |  |      | 112.26 |      |  | 127.55 |  |  | 132.06 |  |  | 81.23  | 
|Peer Group            |  |      | 100.00 |      |  | 125.57 |  |      | 117.58 |      |  | 155.00 |  |  | 137.96 |  |  | 103.68 | 

Assumes $100 invested at the close of trading on 12/03 in Getty Realty
Corp. common stock, Standard & Poors 500, and Peer Group.

|  |                                                            
|- | -----------------------------------------------------------
|* | Cumulative
 total return assumes reinvestment of dividends.

26

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Item 6. Selected Financial Data

GETTY REALTY CORP. AND SUBSIDIARIES
SELECTED FINANCIAL DATA(in thousands, except per share amounts and number of
properties)

|                                                               |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|-------------------------------------------------------------- |  | ---------------------------------- | ------- | ---------- | - | ------- | --- | ---- | ------- | ---- | - | ------- | - | - | ------- | -
|                                                               |  | FOR THE
  YEARS ENDED DECEMBER 31, |        
|                                                               |  |                                    |        
|                                                               |  | 2008                               |         | 2007
  (a) |   | 2006    |     | 2005 |         | 2004 |  
|                                                               |  |                                    |         |            |   |         |     |      |         |      |  
|OPERATING
  DATA:                                              |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Revenues from rental properties                                |  | $                                  | 81,163  |            | $ | 78,069  |     | $    | 71,329  |      | $ | 70,264  |   | $ | 65,188  |  
|Earnings before income taxes and
  discontinued operations     |  |                                    | 39,162  |            |   | 28,110  | (b) |      | 41,228  |      |   | 43,211  |   |   | 38,525  |  
|Income tax benefit (c)                                         |  |                                    |        |            |   |        |     |      | 700     |      |   | 1,494   |   |   |        |  
|                                                               |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Earnings from continuing operations                            |  |                                    | 39,162  |            |   | 28,110  |     |      | 41,928  |      |   | 44,705  |   |   | 38,525  |  
|Earnings from discontinued operations                          |  |                                    | 2,648   |            |   | 5,784   |     |      | 797     |      |   | 743     |   |   | 827     |  
|                                                               |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Net earnings                                                   |  |                                    | 41,810  |            |   | 33,894  |     |      | 42,725  |      |   | 45,448  |   |   | 39,352  |  
|Diluted earnings per common share:                             |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Earnings from continuing operations                            |  |                                    | 1.58    |            |   | 1.13    |     |      | 1.69    |      |   | 1.81    |   |   | 1.56    |  
|Net earnings                                                   |  |                                    | 1.69    |            |   | 1.37    |     |      | 1.73    |      |   | 1.84    |   |   | 1.59    |  
|Diluted weighted-average common shares
  outstanding           |  |                                    | 24,774  |            |   | 24,787  |     |      | 24,759  |      |   | 24,729  |   |   | 24,721  |  
|Cash dividends declared per share                              |  |                                    | 1.87    |            |   | 1.85    |     |      | 1.82    |      |   | 1.76    |   |   | 1.70    |  
|FUNDS FROM OPERATIONS AND ADJUSTED FUNDS
  FROM OPERATION (d): |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Net earnings                                                   |  |                                    | 41,810  |            |   | 33,894  |     |      | 42,725  |      |   | 45,448  |   |   | 39,352  |  
|                                                               |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Depreciation and amortization of real
  estate assets          |  |                                    | 11,875  |            |   | 9,794   |     |      | 7,883   |      |   | 8,113   |   |   | 7,490   |  
|Gains on dispositions of real estate                           |  |                                    | (2,787  | )          |   | (6,179  | )   |      | (1,581  | )    |   | (1,309  | ) |   | (618    | )
|                                                               |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Funds from operations                                          |  |                                    | 50,898  |            |   | 37,509  |     |      | 49,027  |      |   | 52,252  |   |   | 46,224  |  
|Deferred rental revenue (straight-line
  rent)                 |  |                                    | (1,803  | )          |   | (3,112  | )   |      | (3,010  | )    |   | (4,170  | ) |   | (4,464  | )
|Allowance for deferred rental revenue                          |  |                                    |        |            |   | 10,494  |     |      |        |      |   |        |   |   |        |  
|Amortization of above-market and
  below-market leases         |  |                                    | (790    | )          |   | (1,047  | )   |      |        |      |   |        |   |   |        |  
|Income tax benefit (c)                                         |  |                                    |        |            |   |        |     |      | (700    | )    |   | (1,494  | ) |   |        |  
|                                                               |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Adjusted funds from operations                                 |  |                                    | 48,305  |            |   | 43,844  |     |      | 45,317  |      |   | 46,588  |   |   | 41,760  |  
|BALANCE SHEET DATA (AT END OF YEAR):                           |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Real estate before accumulated depreciation
  and amortization |  | $                                  | 473,567 |            | $ | 474,254 |     | $    | 383,558 |      | $ | 370,495 |   | $ | 346,590 |  
|Total assets                                                   |  |                                    | 387,813 |            |   | 396,911 |     |      | 310,922 |      |   | 301,468 |   |   | 292,088 |  
|Debt                                                           |  |                                    | 130,250 |            |   | 132,500 |     |      | 45,194  |      |   | 34,224  |   |   | 24,509  |  
|Shareholders equity                                           |  |                                    | 205,957 |            |   | 212,178 |     |      | 225,575 |      |   | 227,883 |   |   | 225,503 |  
|NUMBER OF PROPERTIES:                                          |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Owned                                                          |  |                                    | 878     |            |   | 880     |     |      | 836     |      |   | 814     |   |   | 795     |  
|Leased                                                         |  |                                    | 182     |            |   | 203     |     |      | 216     |      |   | 241     |   |   | 250     |  
|                                                               |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  
|Total properties                                               |  |                                    | 1,060   |            |   | 1,083   |     |      | 1,052   |      |   | 1,055   |   |   | 1,045   |  
|                                                               |  |                                    |         |            |   |         |     |      |         |      |   |         |   |   |         |  

|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | Includes
 (from the date of the acquisition) the effect of the $84.6 million
 acquisition of convenience stores and gas station properties from FF-TSY
 Holding Company II LLC (successor to Trustreet Properties, Inc.) which was
 substantially completed by the end of the first quarter of 2007.                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(b) | Includes the
 effect of a $10.5 million non-cash reserve for the full amount of the
 deferred rent receivable recorded as of December 31, 2007 related to
 approximately 40% of the properties under leases with our primary tenant,
 Getty Petroleum Marketing, Inc. (For additional information regarding
 developments related to Marketing and the Marketing Leases, see Item 7.
 Managements Discussion and Analysis of Financial Condition and Results of
 Operations  General  Developments Related to Marketing and the Marketing
 Leases.)
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(c) | The years
 ended 2006 and 2005 include income tax benefits recognized due to the
 elimination of, or reduction in, amounts accrued for uncertain tax positions
 related to being taxed as a C-corp. prior to our election to be                                                                                                                                                                                                                                                                                                                         

27

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | taxed as a real estate investment trust (REIT) under the federal
 income tax laws in 2001. Income taxes have not had a significant impact on
 our earnings since we first elected to be treated as a REIT.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(d) | In addition to measurements defined by accounting principles
 generally accepted in the United States of America (GAAP), our management
 also focuses on funds from operations (FFO) and adjusted funds from
 operations (AFFO) to measure our performance. FFO is generally considered
 to be an appropriate supplemental non-GAAP measure of the performance of real
 estate investment trusts (REITs). FFO is defined by the National
 Association of Real Estate Investment Trusts as net earnings before
 depreciation and amortization of real estate assets, gains or losses on
 dispositions of real estate, (including such non-FFO items reported in
 discontinued operations), extraordinary items, and cumulative effect of
 accounting change. Other REITs may use definitions of FFO and/or AFFO that
 are different than ours and; accordingly, may not be comparable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | We believe that FFO is helpful to investors in measuring our
 performance because FFO excludes various items included in GAAP net earnings
 that do not relate to, or are not indicative of, our fundamental operating
 performance such as gains or losses from property dispositions and
 depreciation and amortization of real estate assets. In our case, however,
 GAAP net earnings and FFO include the significant impact of deferred rental
 revenue (straight-line rental revenue) and the net amortization of
 above-market and below-market leases on our recognition of revenue from
 rental properties, as offset by the impact of related collection reserves.
 Deferred rental revenue results primarily from fixed rental increases scheduled
 under certain leases with our tenants. In accordance with GAAP, the aggregate
 minimum rent due over the current term of these leases is recognized on a
 straight-line basis rather than when the payment is due. The present value of
 the difference between the fair market rent and the contractual rent for
 in-place leases at the time properties are acquired is amortized into revenue
 from rental properties over the remaining lives of the in-place leases. GAAP
 net earnings and FFO also include income tax benefits recognized due to the
 elimination of, or reduction in, amounts accrued for uncertain tax positions
 related to being taxed as a C-corp. rather than as a REIT prior to 2001 (see
 note (b) above). As a result, management pays particular attention to AFFO, a
 supplemental non-GAAP performance measure that we define as FFO less
 straight-line rental revenue, net amortization of above-market and
 below-market leases and income tax benefit. In managements view, AFFO
 provides a more accurate depiction than FFO of the impact of the scheduled
 rent increases under these leases, rental revenue from acquired in-place
 leases and our election to be treated as a REIT under the federal income tax
 laws beginning in 2001. Neither FFO nor AFFO represent cash generated from operating
 activities calculated in accordance with GAAP and therefore should not be
 considered an alternative for GAAP net earnings or as a measure of liquidity.

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

The
following discussion and analysis should be read in conjunction with the
Cautionary Note Regarding Forward-Looking Statements on page 1; the risks and
uncertainties described in Item 1A. Risk Factors; the selected financial data
in Item 6.Selected
Financial Data; and the consolidated financial statements and related notes in Item 8. Financial
Statements and Supplementary Data.

GENERAL

Real Estate
Investment Trust

We are a
real estate investment trust (REIT) specializing in the ownership and leasing
of retail motor fuel and convenience store properties and petroleum
distribution terminals. We elected to be treated as a REIT under the federal
income tax laws beginning January 1, 2001. As a REIT, we are not subject to
federal corporate income tax on the taxable income we distribute to our
shareholders. In order to continue to qualify for taxation as a REIT, we are
required, among other things, to distribute at least ninety percent of our
taxable income to shareholders each year.

Retail Petroleum
Marketing Business

We lease or
sublet our properties primarily to distributors and retailers engaged in the
sale of gasoline and other motor fuel products, convenience store products and
automotive repair services. These tenants are responsible for the payment of
taxes, maintenance, repair, insurance and other operating expenses and for
managing the actual

28

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operations conducted at these properties. In addition, approximately
twenty of our properties are directly leased by us to others for other uses
such as fast food restaurants, automobile sales and other retail purposes. In
those instances where we determine that the highest and best use for our
properties is no longer a retail motor fuel outlet, we will seek alternative tenants
or buyers for such properties as opportunities arise. As of December 31, 2008,
we leased eight hundred sixty-four of our one thousand sixty properties on a
long-term basis to Getty Petroleum Marketing Inc. (Marketing). Eight hundred
fifty-four of the properties are leased to Marketing under a unitary master
lease (the Master Lease) with an initial term effective through December 2015
and supplemental leases for ten properties with initial terms of varying
expiration dates (collectively with the Master Lease, the Marketing Leases).
Marketing was spun-off to our shareholders as a separate publicly held company
in March 1997 and, in December 2000; Marketing was acquired by a subsidiary of
OAO LUKoil (Lukoil), one of the largest integrated Russian oil companies.

Marketings
financial results depend largely on retail petroleum marketing margins from the
sale of refined petroleum products at margins in excess of its fixed and
variable expenses and rental income from subtenants who operate their
convenience stores, automotive repair service or other businesses at our
properties. As permitted under the terms of our leases with Marketing,
Marketing can generally use each property for any lawful purpose, or for no
purpose whatsoever. The petroleum marketing industry has been and continues to
be volatile and highly competitive. (For information regarding factors that
could adversely affect us relating to Marketing, or our other lessees, see
Item 1A. Risk Factors.)

Developments Related
to Marketing and the Marketing Leases

A
substantial portion of our revenues (75% for the year ended December 31, 2008)
are derived from the Marketing Leases. Accordingly, our revenues are dependent
to a large degree on the economic performance of Marketing and of the petroleum
marketing industry, and any factor that adversely affects Marketing, or our
relationship with Marketing, may have a material adverse effect on our
business, financial condition, revenues, operating expenses, results of
operations, liquidity, ability to pay dividends and/or stock price. Through
March 2009, Marketing has made all required monthly rental payments under
the Marketing Leases when due, although there is no assurance that it will
continue to do so. Even though Marketing is wholly-owned by a subsidiary of
Lukoil, and Lukoil has in prior periods provided credit enhancement and capital
to Marketing, Lukoil is not a guarantor of the Marketing Leases and there can
be no assurance that Lukoil is currently providing, or will provide, any credit
enhancement or additional capital to Marketing.

In
accordance with accounting principles generally accepted in the United States
of America (GAAP), the aggregate minimum rent due over the current terms of
the Marketing Leases, substantially all of which are scheduled to expire in
December 2015, is recognized on a straight-line basis rather than when payment
is due. We have recorded the cumulative difference between lease revenue
recognized under this straight line accounting method and the lease revenue
recognized when payment is due under the contractual payment terms as deferred
rent receivable on our consolidated balance sheet. We provide reserves for a
portion of the recorded deferred rent receivable if circumstances indicate that
a property may be disposed of before the end of the current lease term or if it
is not reasonable to assume that a tenant will make all of its contractual
lease payments during the current lease term. Our assessments and assumptions
regarding the recoverability of the deferred rent receivable related to the
properties subject to the Marketing Leases are reviewed on a regular basis and
such assessments and assumptions are subject to change.

We have had
periodic discussions with representatives of Marketing regarding potential
modifications to the Marketing Leases and, in 2007, during the course of such
discussions, Marketing proposed to (i) remove approximately 40% of the
properties (the Subject Properties) from the Marketing Leases and eliminate
payment of rent to us, and eliminate or reduce payment of operating expenses,
with respect to the Subject Properties, and (ii) reduce the aggregate amount of
rent payable to us for the approximately 60% of the properties that would
remain under the Marketing Leases (the Remaining Properties). Representatives
of Marketing have also indicated to us that they are considering significant
changes to Marketings business model. In light of these developments and the
continued deterioration in Marketings annual financial performance (as
discussed below), in March 2008, we decided to attempt to negotiate with
Marketing for a modification of the Marketing Leases which removes the Subject
Properties from the Marketing Leases. We have held periodic discussions with
Marketing since March 2008 in our attempt to negotiate a modification of the
Marketing Leases to remove the Subject Properties. Although we continue to
remove individual locations from the Master Lease as mutually beneficial
opportunities arise, there has

29

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been no agreement between us and Marketing on any principal terms that
would be the basis for a definitive Master Lease modification agreement. If
Marketing ultimately determines that its business strategy is to exit all of
the properties it leases from us or to divest a composition of properties
different from the properties comprising the Subject Properties, such as the
revised list of properties provided to us by Marketing in the second quarter of
2008 which includes approximately 45% of the properties Marketing leases from
us (the Revised Subject Properties), it is our intention to cooperate with
Marketing in accomplishing those objectives if we determine that it is prudent
for us to do so. Any modification of the Marketing Leases that removes a
significant number of properties from the Marketing Leases would likely
significantly reduce the amount of rent we receive from Marketing and increase
our operating expenses. We cannot accurately predict if, or when, the Marketing
Leases will be modified or what the terms of any agreement may be if the
Marketing Leases are modified. We also cannot accurately predict what actions
Marketing and Lukoil may take, and what our recourse may be, whether the
Marketing Leases are modified or not.

We intend
either to re-let or sell any properties removed from the Marketing Leases and
reinvest the realized sales proceeds in new properties. We intend to seek
replacement tenants or buyers for properties removed from the Marketing Leases
either individually, in groups of properties, or by seeking a single tenant for
the entire portfolio of properties subject to the Marketing Leases. Although we
are the fee or leasehold owner of the properties subject to the Marketing
Leases and the owner of the Getty® brand and have prior experience with tenants
who operate their gas stations, convenience stores, automotive repair services
or other businesses at our properties; in the event that the properties are
removed from the Marketing Leases, we cannot accurately predict if, when, or on
what terms, such properties could be re-let or sold.

Due to the
previously disclosed deterioration in Marketings annual financial performance,
in conjunction with our decision to attempt to negotiate with Marketing for a
modification of the Marketing Leases to remove the Subject Properties, we have
decided that we cannot reasonably assume that we will collect all of the rent
due to us related to the Subject Properties for the remainder of the current
lease terms. In reaching this conclusion, we relied on various indicators,
including, but not limited to, the following financial results of Marketing
through the year ended December 31, 2007: (i) Marketings significant operating
losses, (ii) its negative cash flow from operating activities, (iii) its asset
impairment charges for underperforming assets, and (iv) its negative earnings
before interest, taxes, depreciation, amortization and rent payable to the
Company. We have not received Marketings financial results for the
year ended December 31, 2008 prior to the preparation of this Annual Report on
Form 10-K.

We recorded
a reserve of $10.5 million in 2007 representing the full amount of the deferred
rent receivable recorded related to the Subject Properties as of December 31,
2007. Providing the $10.5 million non-cash deferred rent receivable reserve
reduced our net earnings and our funds from operations for 2007 but did not
impact our cash flow from operating activities or adjusted funds from
operations since the impact of the straight-line method of accounting is not
included in our determination of adjusted funds from operations. (For
additional information regarding funds from operations and adjusted funds from
operations, which are non-GAAP measures, see  General  Supplemental Non-GAAP
Measures below.) As of December 31, 2008 we had a reserve of $10.0 million for
the deferred rent receivable due from Marketing representing the full amount of
the deferred rent receivable recorded related to the Subject Properties as of
that date. We have not provided a deferred rent receivable reserve related to
the Remaining Properties since, based on our assessments and assumptions, we
continue to believe that it is probable that we will collect the deferred rent
receivable related to the Remaining Properties of $20.5 million as of December
31, 2008 and that Lukoil will not allow Marketing to fail to perform its
rental, environmental and other obligations under the Marketing Leases. We
anticipate that the rental revenue for the Remaining Properties will continue
to be recognized on a straight-line basis. As required by the straight-line method of accounting, beginning with the first quarter of
2008, the rental revenue for the Subject Properties was, and for future
periods, is expected to be, effectively recognized when payment is due under
the contractual payment terms. Although we have adjusted the estimated useful
lives of certain long-lived assets for the Subject Properties, we believe that
no impairment charge was necessary for the Subject Properties as of December
31, 2008 or 2007 pursuant to the provisions of Statement of Financial
Accounting Standards No. 144. The impact to depreciation expense due to
adjusting the estimated lives for certain long-lived assets beginning with the
year ended December 31, 2008 was not material.

Marketing
is directly responsible to pay for (i) remediation of environmental
contamination it causes and compliance with various environmental laws and
regulations as the operator of our properties, and (ii) known and unknown
environmental liabilities allocated to Marketing under the terms of the Master
Lease and various other

30

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agreements between Marketing and us relating to Marketings business
and the properties subject to the Marketing Leases (collectively the Marketing
Environmental Liabilities). We may ultimately be responsible to directly pay
for Marketing Environmental Liabilities as the property owner if Marketing
fails to pay them. Additionally, we will be required to accrue for Marketing
Environmental Liabilities if we determine that it is probable that Marketing
will not meet its obligations or if our assumptions regarding the ultimate
allocation methods and share of responsibility that we used to allocate
environmental liabilities changes as a result of the factors discussed above, or
otherwise. However, we continue to believe that it is not probable that
Marketing will not pay for substantially all of the Marketing Environmental
Liabilities since we believe that Lukoil will not allow Marketing to fail to
perform its rental, environmental and other obligations under the Marketing
Leases and, accordingly, we did not accrue for the Marketing Environmental
Liabilities as of December 31, 2008 or December 31, 2007. Nonetheless, we have
determined that the aggregate amount of the Marketing Environmental Liabilities
(as estimated by us based on our assumptions and analysis of information
currently available to us) could be material to us if we were required to
accrue for all of the Marketing Environmental Liabilities in the future since
we believe that it is reasonably possible that as a result of such accrual, we
may not be in compliance with the existing financial covenants in our Credit
Agreement. Such non-compliance could result in an event of default which, if
not cured or waived, could result in the acceleration of all of our
indebtedness under the Credit Agreement.

Should our
assessments, assumptions and beliefs prove to be incorrect, or if circumstances
change, the conclusions we reached may change relating to (i) whether some or
all of the Subject or Remaining Properties are likely to be removed from the
Marketing Leases (ii) recoverability of the deferred rent receivable for some
or all of the Subject or Remaining Properties, (iii) potential impairment of
the Subject or Remaining Properties, and (iv) Marketings ability to pay the
Marketing Environmental Liabilities. We intend to regularly review our
assumptions that affect the accounting for deferred rent receivable; long-lived
assets; environmental litigation accruals; environmental remediation
liabilities; and related recoveries from state underground storage tank funds,
which may result in material adjustments to the amounts recorded for these
assets and liabilities, and as a result of which, we may not be in compliance with
the financial covenants in our Credit Agreement. Accordingly, we may be
required to (i) reserve additional amounts of the deferred rent receivable
related to the Remaining Properties, (ii) record an impairment charge related
to the Subject or Remaining Properties, or (iii) accrue for Marketing
Environmental Liabilities as a result of the potential or actual modification
of the Marketing Leases or other factors.

We cannot
provide any assurance that Marketing will continue to pay its debts or meet its
rental, environmental or other obligations under the Marketing Leases prior or
subsequent to any potential modification of the Marketing Leases. In the event
that Marketing cannot or will not perform its rental, environmental or other
obligations under the Marketing Leases; if the Marketing Leases are modified
significantly or terminated; if we determine that it is probable that Marketing
will not meet its environmental obligations and we accrue for such liabilities;
if we are unable to promptly re-let or sell the properties subject to the
Marketing Leases; or, if we change our assumptions that affect the accounting
for rental revenue or Marketing Environmental Liabilities related to the
Marketing Leases and various other agreements; our business, financial
condition, revenues, operating expenses, results of operations, liquidity,
ability to pay dividends and/or stock price may be materially adversely
affected.

Unresolved Staff
Comments

One comment
remains unresolved as part of a periodic review commenced in 2004 by the
Division of Corporation Finance of the SEC of our Annual Report on Form 10-K
for the year ended December 31, 2003 pertaining to the SECs position that we
must include the financial statements and summarized financial data of Marketing
in our periodic filings, which Marketing contends is prohibited by the terms of
the Master Lease. In June 2005, the SEC indicated that, unless we file
Marketings financial statements and summarized financial data with our
periodic reports: (i) it will not consider our Annual Reports on Forms 10-K for
the years beginning with 2000 to be compliant; (ii) it will not consider us to
be current in our reporting requirements; (iii) it will not be in a position to
declare effective any registration statements we may file for public offerings
of our securities; and (iv) we should consider how the SECs conclusion impacts
our ability to make offers and sales of our securities under existing
registration statements and if we have a liability for such offers and sales
made pursuant to registration statements that did not contain the financial
statements of Marketing.

We believe
that the SECs position is based on their interpretation of certain provisions
of their internal Financial Reporting Manual (formerly known as their
Accounting Disclosure Rules and Practices Training Material), Staff Accounting
Bulletin No. 71 and Rule 3-13 of Regulation S-X. We do not believe that any of
this guidance is clearly

31

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applicable to our particular circumstances and we believe that, even if
it were, we should be entitled to certain relief from compliance with such
requirements. Marketing generally subleases our properties to independent,
individual service station/convenience store operators (subtenants). Consequently, we believe that we, as the owner of these
properties and the Getty® brand, could re-let these properties to the existing
subtenants (except for those properties that are vacant) who operate their convenience stores, automotive repair services or
other businesses at our properties, or to other new or replacement tenants, at
market rents although we cannot accurately predict if, when, or on what terms,
such properties would be re-let or sold. The SEC did not accept our positions
regarding the inclusion of Marketings financial statements in our filings. We
have had no communication with the SEC since 2005 regarding the unresolved
comment. We cannot accurately predict the consequences if we are ultimately
unable to resolve this outstanding comment.

Supplemental
Non-GAAP Measures

We manage
our business to enhance the value of our real estate portfolio and, as a REIT,
place particular emphasis on minimizing risk and generating cash sufficient to
make required distributions to shareholders of at least ninety percent of our
taxable income each year. In addition to measurements defined by accounting
principles generally accepted in the United States of America (GAAP), our
management also focuses on funds from operations available to common
shareholders (FFO) and adjusted funds from operations available to common
shareholders (AFFO) to measure our performance. FFO is generally considered
to be an appropriate supplemental non-GAAP measure of the performance of REITs.
FFO is defined by the National Association of Real Estate Investment Trusts as
net earnings before depreciation and amortization of real estate assets, gains
or losses on dispositions of real estate, (including such non-FFO items
reported in discontinued operations), extraordinary items and cumulative effect
of accounting change. Other REITs may use definitions of FFO and/or AFFO that
are different than ours and; accordingly, may not be comparable.

We believe
that FFO is helpful to investors in measuring our performance because FFO
excludes various items included in GAAP net earnings that do not relate to, or
are not indicative of, our fundamental operating performance such as gains or
losses from property dispositions and depreciation and amortization of real
estate assets. In our case, however, GAAP net earnings and FFO include the
significant impact of deferred rental revenue (straight-line rental revenue)
and the net amortization of above-market and below-market leases on our
recognition of revenues from rental properties, as offset by the impact of
related collection reserves. Deferred rental revenue results primarily from
fixed rental increases scheduled under certain leases with our tenants. In
accordance with GAAP, the aggregate minimum rent due over the current term of
these leases are recognized on a straight-line basis rather than when payment
is due. The present value of the difference between the fair market rent and
the contractual rent for in-place leases at the time properties are acquired is
amortized into revenue from rental properties over the remaining lives of the
in-place leases. GAAP net earnings and FFO also include income tax benefits
recognized due to the elimination of, or a net reduction in, amounts accrued
for uncertain tax positions related to being taxed as a C-corp., rather than as
a REIT, prior to 2001. As a result, management pays particular attention to
AFFO, a supplemental non-GAAP performance measure that we define as FFO less
straight-line rental revenue, net amortization of above-market and below-market
leases and income tax benefit. In managements view, AFFO provides a more
accurate depiction than FFO of the impact of scheduled rent increases under
these leases, rental revenue from acquired in-place leases and our election to
be treated as a REIT under the federal income tax laws beginning in 2001.
Neither FFO nor AFFO represent cash generated from operating activities
calculated in accordance with GAAP and therefore these measures should not be
considered an alternative for GAAP net earnings or as a measure of liquidity.
For a reconciliation of FFO and AFFO, see Item 6. Selected Financial Data.

Net
earnings, earning from continuing operations and FFO for 2007 were reduced by
all or substantially all of the non-cash $10.5 million reserve for the deferred
rent receivable recorded as of December 31, 2007 for approximately 40% of the
properties leased to Marketing under the Marketing Leases. (See  General 
Developments related to Marketing and the Marketing Leases above for
additional information.) If the applicable amount of the non-cash reserve were
added to our 2007 net earnings, earning from continuing operations and FFO; net
earnings would have been $44.4 million, or $1.79 per share, for the year ended
December 31, 2007; earnings from continuing operations would have been $38.4
million for the year ended December 31, 2007; and FFO would have been $48.0
million, or $1.94 per share, for the year ended December 31, 2007. Accordingly,
as compared to the respective prior year periods; net earnings for 2008 would
have decreased by $2.6 million and for 2007 would have increased by $1.7
million; earnings from continuing operations for 2008 would have increased by
$0.8 million and for 2007 would have decreased by $3.5 million; and FFO for
2008 would have increased by $2.9 million and for

32

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2007 would
have decreased by $1.0 million. We believe that these supplemental non-GAAP
measures for 2007 are important to assist in the analysis of our performance
for 2008 as compared to 2007 and 2007 as compared to 2006, exclusive of the
impact of the non-cash reserve on our results of operations and are reconciled
below (in thousands):

|                                     |  |                |        |         |   |             |  |   |        | 
|------------------------------------ |  | -------------- | ------ | ------- | - | ----------- |  | - | ------ | 
|                                     |  | Non-
 adjusted |        | Reserve |   | As Adjusted | 
|                                     |  |                |        |         |   |             | 
|Net earnings                         |  | $              | 33,894 |         | $ | 10,494      |  | $ | 44,388 | 
|Earnings
 from continuing operations |  |                | 28,110 |         |   | 10,312      |  |   | 38,422 | 
|Funds from
 operations               |  |                | 37,509 |         |   | 10,494      |  |   | 48,003 | 

2007 and 2008
Acquisitions

Effective
March 31, 2007, we acquired fifty-nine convenience store and retail motor fuel
properties in ten states from various subsidiaries of FF-TSY Holding Company
II, LLC (the successor to Trustreet Properties, Inc.) (Trustreet), a
subsidiary of General Electric Capital Corporation, for cash with funds drawn
under our credit facility. Effective April 23, 2007, we acquired five
additional properties from Trustreet. The aggregate cost of the acquisitions,
including transaction costs, was approximately $84.5 million. Substantially all
of the properties are triple-net leased to tenants who previously leased the
properties from the seller. The leases generally provide that the tenants are
responsible for substantially all existing and future environmental conditions
at the properties. In addition, in 2007, we exercised our fixed price purchase
option for seven leased properties, purchased two properties and redeveloped
one property by purchasing land adjacent to it and building a new convenience
store on the existing site. In 2008 we exercised our fixed price purchase
option for three leased properties and purchased six properties.

RESULTS OF OPERATIONS

Year ended December
31, 2008 compared to year ended December 31, 2007

Revenues
from rental properties increased by $3.1 million to $81.2 million for the year
ended December 31, 2008, as compared to $78.1 million for 2007. We received
approximately $60.4 million for 2008, and $59.7 million for 2007, from
properties leased to Marketing under the Marketing Leases. We also received
rent of $18.2 million for 2008 and $14.8 million for 2007 from other tenants.
The increase in rent received was primarily due to rent from properties
acquired in March 2007, and rent escalations, partially offset by the effect of
dispositions of real estate. In addition, revenues from rental properties
include deferred rental revenue of $1.7 million for 2008, as compared to $2.6
million for 2007, recorded as required by GAAP, related to fixed rent increases
scheduled under certain leases with our tenants. The aggregate minimum rent due
over the current term of these leases are recognized on a straight-line basis
rather than when payment is due. Revenues from rental properties also include
$0.8 million and $1.0 million of net amortization of above-market and
below-market leases primarily related to the properties acquired in 2007. The
present value of the difference between the fair market rent and the
contractual rent for in-place leases at the time properties are acquired is
amortized into revenue from rental properties over the remaining lives of the
in-place leases.

Rental
property expenses, which are primarily comprised of rent expense and real
estate and other state and local taxes, were $9.4 million for 2008, as compared
to $9.3 million for 2007. Increases in real estate and other state and local
taxes were partially offset by the decrease in rent expense which was principally
due to the reduction in the number of leased locations compared to the prior
year.

Environmental
expenses, net of estimated recoveries from state underground storage tank
(UST or USTs) funds for 2008 were $7.4 million, as compared to $8.2 million
for 2007. The decrease was primarily due to a $0.5 million decrease in change
in net estimated environmental costs, and a $0.4 million net decrease in
environmental related litigation reserves and legal fees as compared to the
prior year period.

General
and administrative expenses for 2008 were $6.8 million, as compared to $6.7
million recorded for 2007. The increase in general and administrative expenses
was due to $0.5 million of higher professional fees associated with previously
disclosed potential modification of the Marketing Leases which was partially
offset by a $0.2 million reduction in insurance loss reserves and a $0.3
million reduction in employee related expenses. The insurance loss reserves
were established under our self funded insurance program that was terminated in
1997. Employee related expenses recorded in 2007 include the payment of
severance in connection with the resignation of Mr. Andy Smith, the former
President and Chief Legal Officer of the Company.

33

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Allowance
for deferred rent receivable reported in continuing operations and discontinued
operations were $10.3 million and $0.2 million, respectively, for the year
ended December 31, 2007. The non-cash allowance was provided in 2007 since we
could no longer reasonably assume that we will collect all of the rent due to
us related to approximately 40% of the properties leased to Marketing for the
remainder of the current terms of the Marketing Leases. (See  General 
Developments related to Marketing and the Marketing Leases above for
additional information.)

Depreciation
and amortization expense for 2008 was $11.8 million, as compared to $9.6
million for 2007. The increase was primarily due to properties acquired in 2007
and the acceleration of depreciation expense resulting from the reduction in
the estimated useful lives of certain assets which may be removed from the
unitary lease with Marketing, which increases were partially offset by the
effect of dispositions of real estate and lease expirations.

As
a result, total operating expenses decreased by approximately $8.7 million for
2008 as compared to 2007.

Other
income, net, substantially all of which is comprised of certain gains from
dispositions of real estate and leasehold interests, decreased by $1.5 million
to $0.4 million for 2008, as compared to $1.9 million for 2007. Gains on
dispositions of real estate from discontinued operations were $2.4 million for
2008 as compared to $4.6 million for 2007. Gain on dispositions of real estate
in 2008 decreased by an aggregate of $3.4 million to $2.8 million, as compared
to $6.2 million for the prior year. For 2008, there were eleven property
dispositions and four partial land takings under eminent domain. For 2007,
there were thirteen property dispositions, a partial land taking under eminent
domain and an increase in the awards for two takings that occurred in prior
years. Property dispositions for 2008 and 2007 include seven and six
properties, respectively, that were mutually agreed to be removed from the
Marketing Leases prior to their scheduled lease expiration.

Interest
expense was $7.0 million for 2008, as compared to $7.8 million for 2007. The
decrease was due to reduction in interest rates, partially offset by increased
average borrowings outstanding used to finance the acquisition of properties in
2007.

As
a result, net earnings were $41.8 million for 2008, as compared to $33.9
million for 2007, an increase of 23.4%, or $7.9 million. Earnings from continuing
operations were $39.2 million for 2008, as compared to $28.1 million for 2007,
an increase of 39.3%, or $11.1 million. For the same period, FFO increased by
35.7% to $50.9 million, as compared to $37.5 million for prior year period and
AFFO increased by 10.2%, or $4.5 million, to $48.3 million, as compared to
$43.8 million for 2007. The increase in FFO for 2008 was primarily due to the
changes in net earnings described above but excludes a $2.1 million increase in
depreciation and amortization expense and a $3.4 million decrease in gains on
dispositions of real estate. The increase in AFFO for 2008 also excludes a $1.3
million decrease in deferred rental revenue, a $.03 million decrease in net
amortization of above-market and below-market leases and a $10.5 million
allowance for deferred rent receivable recorded in 2007 (which are included in
net earnings and FFO but are excluded from AFFO).

Diluted
earnings per share were $1.69 per share for 2008, an increase of $0.32 per
share, as compared to $1.37 per share for 2007. Diluted FFO per share for 2008
was $2.05 per share, an increase of $0.54 per share, as compared to 2007.
Diluted AFFO per share for 2008 was $1.95 per share, an increase of $0.18 per
share, as compared to 2007.

Year ended December
31, 2007 compared to year ended December 31, 2006

Revenues
from rental properties increased by $6.8 million to $78.1 million for the year
ended December 31, 2007, as compared to $71.3 million for 2006. We received
approximately $59.7 million for 2007, and $59.5 million for 2006, from
properties leased to Marketing under the Marketing Leases. We also received
rent of $14.8 million for 2007 and $8.9 million for 2006 from other tenants.
The increase in rent received was primarily due to rent from properties
acquired in March 2007 and February 2006, and rent escalations, partially
offset by the effect of dispositions of real estate. In addition, revenues from
rental properties include deferred rental revenue of $2.6 million for 2007, as
compared to $3.0 million for 2006, recorded as required by GAAP, related to
fixed rent increases scheduled under certain leases with our tenants. The
aggregate minimum rent due over the current term of these leases are recognized
on a straight-line basis rather than when payment is due. Revenues from rental
properties also include $1.0 million of net amortization of above-market and
below-market leases related to the properties acquired in 2007. The present
value of the difference between the fair market rent and the contractual rent
for in-

34

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place leases
at the time properties are acquired is amortized into revenue from rental
properties over the remaining lives of the in-place leases.

Rental
property expenses, which are primarily comprised of rent expense and real
estate and other state and local taxes, were $9.3 million for 2007, as compared
to $9.6 million for 2006. The decrease in rent expense was principally due to
the reduction in the number of leased locations compared to the prior year.

Environmental
expenses, net of estimated recoveries from state UST funds for 2007 were $8.2
million, as compared to $5.4 million for 2006. The increase was primarily due
to a $1.9 million increase in change in net estimated environmental costs, and
a $0.8 million increase in environmental related litigation expenses and legal
fees as compared to the prior year period. The increase in the net change in
estimated environmental costs was due to the increase in project scope or
duration and related cost forecasts at a limited number of properties,
including one site that we have agreed to remediate as part of a legal
settlement with the State of New York and regulator mandated project changes at
other sites. The increase in environmental related litigation expenses was due
to $0.5 million of higher legal fees and $0.3 million of higher litigation loss
reserves.

General
and administrative expenses for 2007 were $6.7 million, as compared to $5.6
million recorded for 2006. The increase in general and administrative expenses
was principally due to $0.5 million of higher employee related expenses, $0.2
million of higher professional fees and a charge of $0.1 million to insurance
loss reserves recorded in 2007, as compared to a credit of $0.3 million
recorded in 2006. The insurance loss reserves were established under our self
funded insurance program that was terminated in 1997. Employee related expenses
increased primarily due to the payment of severance in 2007 in connection with
the resignation of Mr. Andy Smith, the former President and Chief Legal Officer
of the Company.

Allowance
for deferred rent receivable reported in continuing operations and discontinued
operations were $10.3 million and $0.2 million, respectively, for the quarter
and year ended December 31, 2007. The non-cash allowance was provided since we
can no longer reasonably assume that we will collect all of the rent due to us
related to approximately 40% of the properties leased to Marketing for the
remainder of the current terms of the Marketing Leases. (See  General 
Developments related to Marketing and the Marketing Leases above for
additional information.)

Depreciation
and amortization expense for 2007 was $9.6 million, as compared to $7.8 million
for 2006. The increase was primarily due to properties acquired in 2007 and
2006, offset by the effect of dispositions of real estate and lease
expirations.

As
a result, total operating expenses increased by approximately $15.7 million for
2007 as compared to 2006.

Other
income, net, substantially all of which is comprised of certain gains from
dispositions of real estate and leasehold interests, was $1.9 million for 2007
and 2006. Gains on dispositions of real estate from discontinued operations
were $4.6 million for 2007. Gain on dispositions of real estate in 2007
increased by an aggregate of $4.6 million to $6.2 million, as compared to $1.6
million for the prior year. For 2007, there were thirteen property
dispositions, including six properties that were mutually agreed to be removed
from the Marketing Leases prior to their scheduled lease expiration, a partial
land taking under eminent domain and an increase in the awards for two takings
that occurred in prior years, as compared to seven property dispositions, a
total property taking and seven partial land takings recorded in the prior year
period.

Interest
expense was $7.8 million for 2007, as compared to $3.5 million for 2006. The
increase was primarily due to increased borrowings used to finance the
acquisition of properties in 2007 and 2006.

The
income tax benefit of $0.7 million recorded in 2006 was recognized due to the
elimination of the accrual for uncertain tax positions since management
believes that the uncertainties regarding these exposures have been resolved or
that it is no longer likely that the exposure will result in a liability upon
review. However, the ultimate resolution of these matters may have a
significant impact on our results of operations for any single fiscal year or
interim period.

35

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As
a result, net earnings were $33.9 million for 2007, as compared to $42.7
million for 2006, a decrease of 20.7%, or $8.8 million. Earnings from
continuing operations were $28.1 million for 2007, as compared to $41.9 million
for 2006, a decrease of 33.0%, or $13.8 million. For the same period, FFO
decreased by 23.5% to $37.5 million, as compared to $49.0 million for prior
year period and AFFO decreased by 3.3%, or $1.5 million, to $43.8 million, as
compared to $45.3 million for 2006. The decrease in FFO for 2007 was primarily
due to the changes in net earnings described above but excludes a $1.9 million
increase in depreciation and amortization expense and a $4.6 million increase
in gains on dispositions of real estate. The decrease in AFFO for 2007 also
excludes a $0.7 million decrease in income tax benefit, a $0.1 million decrease
in deferred rental revenue, a $1.0 million increase in net amortization of
above-market and below-market leases and a $10.5 million allowance for deferred
rent receivable recorded in 2007 (which are included in net earnings and FFO
but are excluded from AFFO).

Diluted
earnings per share were $1.37 per share for 2007, a decrease of $0.36 per
share, as compared to $1.73 per share for 2006. Diluted FFO per share for 2007
was $1.51 per share, a decrease of $0.47 per share, as compared to 2006.
Diluted AFFO per share for 2007 was $1.77 per share, a decrease of $0.06 per
share, as compared to 2006.

LIQUIDITY AND CAPITAL RESOURCES

Our
principal sources of liquidity are the cash flows from our business, funds
available under a revolving credit agreement that expires in 2011 and available
cash and cash equivalents. Management believes that our operating cash needs for
the next twelve months can be met by cash flows from operations, borrowings
under our credit agreement and available cash and cash equivalents.

The
current disruption in the credit markets and the resulting impact on the
availability of funding generally may limit our access to one or more funding
sources. In addition, we expect that the costs associated with any additional
borrowings we may undertake may be adversely impacted, as compared to such
costs prior to the disruption of the credit markets. The United States credit
markets are currently experiencing an unprecedented contraction. As a result of
the tightening credit markets, we may not be able to obtain additional
financing on favorable terms, or at all. If one or more of the financial
institutions that supports our credit agreement fails, we may not be able to
find a replacement, which would negatively impact our ability to borrow under
our credit agreement. In addition, if the current pressures on credit continue
or worsen, we may not be able to refinance our outstanding debt when due, which
could have a material adverse effect on us.

We
have a $175.0 million amended and restated senior unsecured revolving credit
agreement (the Credit Agreement) with a group of domestic commercial banks
led by JPMorgan Chase Bank, N.A. (the Bank Syndicate) which expires in March
2011. The Credit Agreement does not provide for scheduled reductions in the
principal balance prior to its maturity. The Credit Agreement permits
borrowings at an interest rate equal to the sum of a base rate plus a margin of
0.0% or 0.25% or a LIBOR rate plus a margin of 1.0%, 1.25% or 1.5%. The
applicable margin is based on our leverage ratio at the end of the prior
calendar quarter, as defined in the Credit Agreement, and is adjusted effective
mid-quarter when our quarterly financial results are reported to the Bank
Syndicate. Based on our leverage ratio as of December 31, 2008, the applicable
margin is 0.0% for base rate borrowings and will increase to 1.25% in the first
quarter of 2009 for our LIBOR rate borrowings.

Subject
to the terms of the Credit Agreement, we have the option to extend the term of
the Credit Agreement for one additional year to March 2012 and/or, subject to
approval by the Bank Syndicate, increase the amount of the credit facility
available pursuant to the Credit Agreement by $125,000,000 to $300,000,000. We
do not expect to exercise our option to increase the amount of the Credit
Agreement at this time. In addition, based on the current lack of liquidity in
the credit markets, we believe that we would need to renegotiate certain terms
in the Credit Agreement in order to obtain approval from the Bank Syndicate to
increase the amount of the credit facility at this time. No assurance can be
given that such approval from the Bank Syndicate will be obtained on terms
acceptable to us, if at all. The annual commitment fee on the unused Credit
Agreement ranges from 0.10% to 0.20% based on the average amount of borrowings
outstanding. The Credit Agreement contains customary terms and conditions,
including customary financial covenants such as leverage and coverage ratios
and other customary covenants, including limitations on our ability to incur
debt and pay dividends and maintenance of tangible net worth, and events of
default, including change of control and failure to maintain REIT status. A
material adverse effect on our business, assets, prospects or condition,
financial or otherwise, would also result in an event of default. Any event of

36

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default, if
not cured or waived, could result in the acceleration of all of our
indebtedness under our Credit Agreement.

We
entered into a $45.0 million LIBOR based interest rate swap agreement with
JPMorgan Chase Bank, N.A. as the counterparty (the Swap Agreement), effective
through June 30, 2011. The Swap Agreement is intended to hedge our current
exposure to market interest rate risk by effectively fixing, at 5.44%, the
LIBOR component of the interest rate determined under our existing Credit
Agreement or future exposure to variable interest rate risk due to borrowing
arrangements that may be entered into prior to the expiration of the Swap
Agreement. As a result of the Swap Agreement, as of December 31, 2008, $45.0
million of our LIBOR based borrowings under the Credit Agreement bear interest
at an effective rate of 6.44%.

Total
borrowings outstanding under the Credit Agreement at December 31, 2008 were
$130.3 million, bearing interest at a weighted-average effective rate of 3.8%
per annum. The weighted-average effective rate is based on $85.3 million of
LIBOR rate borrowings floating at market rates plus a margin of 1.0% and $45.0
million of LIBOR rate borrowings effectively fixed at 5.44% by the Swap
Agreement plus a margin of 1.0%. We had $44.7 million available under the terms
of the Credit Agreement as of December 31, 2008.

Since
we generally lease our properties on a triple-net basis, we do not incur
significant capital expenditures other than those related to acquisitions.
Capital expenditures, including acquisitions, for 2008, 2007 and 2006 amounted
to $6.6 million, $90.6 million and $15.5 million, respectively. To the extent
that our current sources of liquidity are not sufficient to fund capital
expenditures and acquisitions we will require other sources of capital, which
may or may not be available on favorable terms or at all. We may be unable to
pursue public debt or equity offerings until we resolve with the SEC the
outstanding comment regarding disclosure of Marketings financial information.
We cannot accurately predict how periods of illiquidity in the credit markets,
such as current market conditions, will impact our access to capital.

As
part of our overall growth strategy, we regularly review opportunities to
acquire additional properties and we expect to continue to pursue acquisitions
that we believe will benefit our financial performance. To the extent that our
current sources of liquidity are not sufficient to fund such acquisitions we
will require other sources of capital, which may or may not be available on
favorable terms or at all. We cannot accurately predict how periods of
illiquidity in the credit markets, such as current market conditions, will
impact our access to capital.

We
elected to be treated as a REIT under the federal income tax laws with the year
beginning January 1, 2001. As a REIT, we are required, among other things, to
distribute at least ninety percent of our taxable income to shareholders each
year. Payment of dividends is subject to market conditions, our financial
condition and other factors, and therefore cannot be assured. In particular,
our Credit Agreement prohibits the payment of dividends during certain events
of default. Dividends paid to our shareholders aggregated $46.3 million, $45.7
million and $44.8 million for 2008, 2007 and 2006, respectively, and were paid
on a quarterly basis during each of those years. We presently intend to pay
common stock dividends of $0.47 per share each quarter ($1.88 per share, or $46.7
million, on an annual basis), and commenced doing so with the quarterly
dividend declared in May 2008. Due to the developments related to Marketing and
the Marketing Leases discussed above, there is no assurance that we will be
able to continue to pay dividends at the rate of $0.47 per share per quarter,
if at all.

CONTRACTUAL OBLIGATIONS

Our
significant contractual obligations and commitments are comprised of borrowings
under the Credit Agreement, operating lease payments due to landlords and estimated
environmental remediation expenditures, net of estimated recoveries from state
UST funds. In addition, as a REIT we are required to pay dividends equal to at
least

37

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ninety percent of our taxable income in order to continue to qualify as
a REIT. Our contractual obligations and commitments as of December 31, 2008 are
summarized below (in thousands):

|                                                                    |  |       |         |                      |   |                      |   |                        |         |                         |   |       |   |   |       |  
|------------------------------------------------------------------- |  | ----- | ------- | -------------------- | - | -------------------- | - | ---------------------- | ------- | ----------------------- | - | ----- | - | - | ----- | -
|                                                                    |  | TOTAL |         | LESS
 THAN ONE
 YEAR |   | ONE TO
 THREE
 YEARS |   | THREE
 TO
 FIVE
 YEARS |         | MORE
 THAN
 FIVE
 YEARS |  
|                                                                    |  |       |         |                      |   |                      |   |                        |         |                         |  
|Operating leases                                                    |  | $     | 26,620  |                      | $ | 7,338                |   | $                      | 10,571  |                         | $ | 5,235 |   | $ | 3,476 |  
|Borrowing under the Credit Agreement (a)                            |  |       | 130,250 |                      |   |                     |   |                        | 130,250 |                         |   |      |   |   |      |  
|Estimated environmental remediation
 expenditures (b)               |  |       | 17,660  |                      |   | 6,946                |   |                        | 6,411   |                         |   | 2,480 |   |   | 1,823 |  
|Estimated recoveries from state underground
 storage tank funds (b) |  |       | (4,223  | )                    |   | (1,368               | ) |                        | (1,479  | )                       |   | (844  | ) |   | (532  | )
|                                                                    |  |       |         |                      |   |                      |   |                        |         |                         |  
|Estimated net environmental remediation
 expenditures (b)           |  |       | 13,437  |                      |   | 5,578                |   |                        | 4,932   |                         |   | 1,636 |   |   | 1,291 |  
|                                                                    |  |       |         |                      |   |                      |   |                        |         |                         |  
|Total                                                               |  | $     | 170,307 |                      | $ | 12,916               |   | $                      | 145,753 |                         | $ | 6,871 |   | $ | 4,767 |  
|                                                                    |  |       |         |                      |   |                      |   |                        |         |                         |  

|    |                                                                                                                                                                                                                                                                                                                         
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | Excludes related interest payments. (See  Liquidity and Capital
 Resources above and Item 7A. Quantitative and Qualitative Disclosures About
 Market Risk for additional information.) Subject to the terms of the Credit
 Agreement, we have the option to extend the term of the Credit Agreement to
 March 2012.
|    |                                                                                                                                                                                                                                                                                                                         
|(b) | Estimated environmental remediation expenditures and estimated
 recoveries from state UST funds have been adjusted for inflation and discounted
 to present value.                                                                                                                                                      

Generally,
the leases with our tenants are triple-net leases, with the tenant
responsible for the payment of taxes, maintenance, repair, insurance,
environmental remediation and other operating expenses. We estimate that
Marketing makes annual real estate tax payments for properties leased under the
Marketing Leases of approximately $12.3 million and makes additional payments
for other operating expenses related to our properties, including environmental
remediation costs other than those liabilities that were retained by us. These
costs are not reflected in our consolidated financial statements. (See 
General  Developments related to Marketing and the Marketing Leases above for
additional information.)

We have no
significant contractual obligations not fully recorded on our consolidated
balance sheets or fully disclosed in the notes to our consolidated financial
statements. We have no off-balance sheet arrangements as defined in Item
303(a)(4)(ii) of Regulation S-K promulgated by the Exchange Act.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The
consolidated financial statements included in this Annual Report on Form 10-K
include the accounts of Getty Realty Corp. and our wholly-owned subsidiaries. The
preparation of financial statements in accordance with GAAP requires management
to make estimates, judgments and assumptions that affect the amounts reported
in its financial statements. Although we have made our best estimates,
judgments and assumptions regarding future uncertainties relating to the
information included in our financial statements, giving due consideration to
the accounting policies selected and materiality, actual results could differ
from these estimates, judgments and assumptions and such differences could be
material.

Estimates,
judgments and assumptions underlying the accompanying consolidated financial
statements include, but are not limited to, deferred rent receivable,
recoveries from state underground storage tank funds, environmental remediation
costs, real estate, depreciation and amortization, impairment of long-lived
assets, litigation, accrued expenses, income taxes, allocation of the purchase
price of properties acquired to the assets acquired and liabilities assumed and
exposure to paying an earnings and profits deficiency dividend. The information
included in our financial statements that is based on estimates, judgments and
assumptions is subject to significant change and is adjusted as circumstances
change and as the uncertainties become more clearly defined. Our accounting
policies are described in Note 1 of Notes to Consolidated Financial Statements.
We believe the following are our critical accounting policies:

Revenue
recognition  We earn revenue primarily from operating leases with Marketing
and other tenants. We recognize income under the Master Lease with Marketing,
and with other tenants, on the straight-line method, which effectively
recognizes contractual lease payments evenly over the current term of the
leases. The present value of the

38

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difference between the fair market rent and the contractual rent for
in-place leases at the time properties are acquired is amortized into revenue
from rental properties over the remaining lives of the in-place leases. A
critical assumption in applying the straight-line accounting method is that the
tenant will make all contractual lease payments during the current lease term
and that the net deferred rent receivable of $26.7 million recorded as of December
31, 2008 will be collected when the payment is due, in accordance with the
annual rent escalations provided for in the leases. Historically our tenants
have generally made rent payments when due. However, we may be required to
reverse, or provide reserves for, or adjust our $10.0 million reserve as of
December 31, 2008 for, a portion of the recorded deferred rent receivable if it
becomes apparent that a property may be disposed of before the end of the
current lease term or if circumstances indicate that the tenant may not make
all of its contractual lease payments when due during the current term of the
lease. The straight-line method requires that rental income related to those
properties for which a reserve was provided is effectively recognized in subsequent
periods when payment is due under the contractual payment terms. (See
developments related to Marketing and the Marketing Leases in  General 
Developments related to Marketing and the Marketing Leases above for
additional information.)

Impairment
of long-lived assets  Real estate assets represent long-lived assets for
accounting purposes. We review the recorded value of long-lived assets for
impairment in value whenever any events or changes in circumstances indicate
that the carrying amount of the assets may not be recoverable. We may become
aware of indicators of potentially impaired assets upon tenant or landlord
lease renewals, upon receipt of notices of potential governmental takings and
zoning issues, or upon other events that occur in the normal course of business
that would cause us to review the operating results of the property. We believe
our real estate assets are not carried at amounts in excess of their estimated
net realizable fair value amounts.

Income
taxes  Our financial results generally do not reflect provisions for current
or deferred federal income taxes since we elected to be treated as a REIT under
the federal income tax laws effective January 1, 2001. Our intention is to
operate in a manner that will allow us to continue to be treated as a REIT and,
as a result, we do not expect to pay substantial corporate-level federal income
taxes. Many of the REIT requirements, however, are highly technical and
complex. If we were to fail to meet the requirements, we may be subject to
federal income tax, excise taxes, penalties and interest or we may have to pay
a deficiency dividend to eliminate any earnings and profits that were not
distributed. Certain states do not follow the federal REIT rules and we have included
provisions for these taxes in rental property expenses.

Environmental
costs and recoveries from state UST funds  We provide for the estimated fair
value of future environmental remediation costs when it is probable that a
liability has been incurred and a reasonable estimate of fair value can be made
(see  Environmental Matters below for additional information). Environmental
liabilities and related recoveries are measured based on their expected future
cash flows which have been adjusted for inflation and discounted to present
value. Since environmental exposures are difficult to assess and estimate and
knowledge about these liabilities is not known upon the occurrence of a single
event, but rather is gained over a continuum of events, we believe that it is
appropriate that our accrual estimates are adjusted as the remediation
treatment progresses, as circumstances change and as environmental
contingencies become more clearly defined and reasonably estimable. A critical
assumption in accruing for these liabilities is that the state environmental
laws and regulations will be administered and enforced in the future in a
manner that is consistent with past practices. Recoveries of environmental
costs from state UST remediation funds, with respect to past and future
spending, are accrued as income, net of allowance for collection risk, based on
estimated recovery rates developed from our experience with the funds when such
recoveries are considered probable. A critical assumption in accruing for these
recoveries is that the state UST fund programs will be administered and funded
in the future in a manner that is consistent with past practices and that
future environmental spending will be eligible for reimbursement at historical
rates under these programs. We accrue environmental liabilities based on our
share of responsibility as defined in our lease contracts with our tenants and under various other agreements with others or
if circumstances indicate that the counter-party may not have the financial resources
to pay its share of the costs. It is possible that our assumptions regarding
the ultimate allocation method and share of responsibility that we used to
allocate environmental liabilities may change, which may result in adjustments
to the amounts recorded for environmental litigation accruals, environmental
remediation liabilities and related assets. (See  General  Developments
related to Marketing and the Marketing Leases above for additional
information.) We may ultimately be responsible to directly pay for
environmental liabilities as the property owner if Marketing or our other tenants or other counter-parties fail to pay them.
In certain environmental matters the effect on future financial results is not
subject to reasonable estimation because considerable uncertainty exists both
in terms of the probability of loss and the estimate of such

39

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loss. The ultimate liabilities resulting from such lawsuits and claims,
if any, may be material to our results of operations in the period in which
they are recognized.

Litigation
 Legal fees related to litigation are expensed as legal services are
performed. We provide for litigation reserves, including certain environmental
litigation (see  Environmental Matters below for additional information),
when it is probable that a liability has been incurred and a reasonable estimate
of the liability can be made. If the best estimate of the liability can only be
identified as a range, and no amount within the range is a better estimate than
any other amount, the minimum of the range is accrued for the liability.

New
Accounting Pronouncements  In September 2006, the Financial Accounting
Standards Board (FASB) issued Statement of Financial Accounting Standards
(SFAS) No. 157, Fair Value Measurements (SFAS 157). SFAS 157 provides
guidance for using fair value to measure assets and liabilities. SFAS 157
generally applies whenever other standards require assets or liabilities to be
measured at fair value. SFAS 157 is effective in fiscal years beginning after
November 15, 2007. FASB Staff Position (FSP) No. 152, Effective Date of FASB
Statement No. 157, (FSP 152) delayed the effective date of FASB No. 157 by
one year for nonfinancial assets and liabilities that are recognized or
disclosed at fair value in the financial statements on a non recurring basis to
fiscal years beginning after November 15, 2008. The adoption of SFAS 157 in January 2008 has not had a
material impact on our financial position and results of operations. We do not
believe that the adoption of the provisions of SFAS 157 for nonfinancial assets
and liabilities that are recognized or disclosed at fair value on a non
recurring basis will have a material impact on our financial position and
results of operations.

In December
2007, the FASB issued SFAS No. 141 (revised 2007), Business Combinations
(SFAS 141(R)), which establishes principles and requirements for how the
acquirer shall recognize and measure in its financial statements at fair value
the identifiable assets acquired, liabilities assumed, any noncontrolling
interest in the acquiree and goodwill acquired in a business combination. SFAS
141(R) requires that acquisition costs, which could be material to our future
financial results, will be expensed rather than included as part of the basis
of the acquisition. The adoption of this standard by us on January 1, 2009 will
not result in a write-off of acquisition related transactions costs associated
with transactions not yet consummated. SFAS 141(R) is effective for business
combinations for which the acquisition date is on or after the beginning of the
first annual reporting period beginning on or after December 15, 2008.

ENVIRONMENTAL MATTERS

General

We are
subject to numerous existing federal, state and local laws and regulations,
including matters relating to the protection of the environment such as the
remediation of known contamination and the retirement and decommissioning or
removal of long-lived assets including buildings containing hazardous
materials, USTs and other equipment. Our tenants are directly responsible for compliance
with various environmental laws and regulations as the operators of our
properties. Environmental expenses are principally attributable to remediation
costs which include installing, operating, maintaining and decommissioning
remediation systems, monitoring contamination, and governmental agency
reporting incurred in connection with contaminated properties. We seek
reimbursement from state UST remediation funds related to these environmental
expenses where available.

We enter
into leases and various other agreements which allocate responsibility for
known and unknown environmental liabilities by establishing the percentage and
method of allocating responsibility between the parties. In accordance with the
leases with certain of our tenants, we have agreed to bring the leased
properties with known environmental contamination to within applicable
standards and to regulatory or contractual closure (Closure) in an efficient
and economical manner. Generally, upon achieving Closure at an individual
property, our environmental liability under the lease for that property will be
satisfied and future remediation obligations will be the responsibility of our
tenant. As of December 31, 2008, we have regulatory approval for remediation
action plans in place for two hundred forty-nine (95%) of the two hundred
sixty-two properties for which we continue to retain remediation responsibility
and the remaining thirteen properties (5%) were in the assessment phase. In
addition, we have nominal post-closure compliance obligations at twenty-four
properties where we have received no further action letters.

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Our tenants
are directly responsible to pay for (i) remediation of environmental
contamination they cause and compliance with various environmental laws and
regulations as the operators of our properties, and (ii) environmental
liabilities allocated to our tenants under the terms of our leases and various
other agreements between our tenants and us. Generally, the liability for the
retirement and decommissioning or removal of USTs and other equipment is the
responsibility of our tenants. We are contingently liable for these obligations
in the event that our tenants do not satisfy their responsibilities. A
liability has not been accrued for obligations that are the responsibility of
our tenants based on our tenants past histories of paying such obligations
and/or our assessment of their respective financial abilities to pay their
share of such costs. However, there can be no assurance that our assessments
are correct or that our tenants who have paid their obligations in the past
will continue to do so.

It is
possible that our assumptions regarding the ultimate allocation methods and
share of responsibility that we used to allocate environmental liabilities may
change, which may result in adjustments to the amounts recorded for
environmental litigation accruals, environmental remediation liabilities and
related assets. We will be required to accrue for environmental liabilities
that we believe are allocable to others under various other agreements if we
determine that it is probable that the counter-party will not meet its
environmental obligations. We may ultimately be responsible to directly pay for
environmental liabilities as the property owner if the counter-party fails to
pay them. The ultimate resolution of these matters could have a material
adverse effect on our business, financial condition, results of operations,
liquidity, ability to pay dividends and/or stock price. (See  General 
Developments related to Marketing and the Marketing Leases above for
additional information.)

We have not
accrued for approximately $1.0 million in costs allegedly incurred by the
current property owner in connection with removal of USTs and soil remediation
at a property that was leased to and operated by Marketing. We believe that
Marketing is responsible for such costs under the terms of the Master Lease and
have tendered the matter for defense and indemnification from Marketing, but
Marketing has denied its liability for the claim and its responsibility to
defend against, and indemnify us for, the claim. We have filed third party
claims against Marketing for indemnification in this matter, which claims is
currently being actively litigated. Trial is anticipated to be scheduled for
the first quarter of 2009. It is reasonably possible that our assumption that
Marketing will be ultimately responsible for the claim may change, which may
result in our providing an accrual for this and other matters.

We have
also agreed to provide limited environmental indemnification to Marketing,
capped at $4.25 million and expiring in 2010, for certain pre-existing
conditions at six of the terminals we own and lease to Marketing. Under the
indemnification agreement, Marketing is obligated to pay the first $1.5 million
of costs and expenses incurred in connection with remediating any such
pre-existing conditions, Marketing will share equally with us the next $8.5
million of those costs and expenses and Marketing is obligated to pay all
additional costs and expenses over $10.0 million. We have accrued $0.3 million
as of December 31, 2008 and 2007 in connection with this indemnification
agreement. Under the Master Lease, we continue to have additional ongoing
environmental remediation obligations for one hundred eighty-seven scheduled
sites.

As the
operator of our properties under the Marketing Leases, Marketing is directly
responsible to pay for the remediation of environmental contamination it causes
and to comply with various environmental laws and regulations. In addition, the
Marketing Leases and various other agreements between Marketing and us allocate
responsibility for known and unknown environmental liabilities between
Marketing and us relating to the properties subject to the Marketing Leases.
Based on various factors, including our assessments and assumptions at this
time that Lukoil would not allow Marketing to fail to perform its obligations
under the Marketing Leases, we believe that Marketing will continue to pay for
substantially all environmental contamination and remediation costs allocated
to it under the Marketing Leases. It is possible that our assumptions regarding
the ultimate allocation methods and share of responsibility that we used to
allocate environmental liabilities may change as a result of the factors
discussed above, or otherwise, which may result in adjustments to the amounts
recorded for environmental litigation accruals, environmental remediation
liabilities and related assets. We may ultimately be responsible to directly
pay for environmental liabilities as the property owner if Marketing fails to
pay them. We are required to accrue for environmental liabilities that we
believe are allocable to Marketing under the Marketing Leases and various other
agreements if we determine that it is probable that Marketing will not pay its
environmental obligations.

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Based upon
our assessment of Marketings financial condition and certain other factors,
including but not limited to those described above, we believe at this time
that it is not probable that Marketing will not pay the environmental
liabilities allocable to it under the Marketing Leases and various other
agreements and, therefore, have not accrued for such environmental liabilities.
Our assessments and assumptions that affect the recording of environmental
liabilities related to the properties subject to the Marketing Leases are
reviewed on a quarterly basis and such assessments and assumptions are subject
to change.

We have
determined that the aggregate amount of the environmental liabilities
attributable to Marketing related to our properties (as estimated by us based
on our assumptions and analysis of information currently available to us) (the
Marketing Environmental Liabilities) could be material to us if we were
required to accrue for all of the Marketing Environmental Liabilities in the
future since we believe that it is reasonably possible that as a result of such
accrual, we may not be in compliance with the existing financial covenants in
our Credit Agreement. Such non-compliance could result in an event of default
which, if not cured or waived, could result in the acceleration of all of our
indebtedness under the Credit Agreement. (See  General  Developments related
to Marketing and the Marketing Leases above for additional information.)

The
estimated future costs for known environmental remediation requirements are
accrued when it is probable that a liability has been incurred and a reasonable
estimate of fair value can be made. Environmental liabilities and related
recoveries are measured based on their expected future cash flows which have
been adjusted for inflation and discounted to present value. The environmental
remediation liability is estimated based on the level and impact of
contamination at each property and other factors described herein. The accrued
liability is the aggregate of the best estimate for the fair value of cost for
each component of the liability. Recoveries of environmental costs from state
UST remediation funds, with respect to both past and future environmental
spending, are accrued at fair value as an offset to environmental expense, net
of allowance for collection risk, based on estimated recovery rates developed
from our experience with the funds when such recoveries are considered
probable.

Environmental
exposures are difficult to assess and estimate for numerous reasons, including
the extent of contamination, alternative treatment methods that may be applied,
location of the property which subjects it to differing local laws and
regulations and their interpretations, as well as the time it takes to
remediate contamination. In developing our liability for probable and reasonably
estimable environmental remediation costs, on a property by property basis, we
consider among other things, enacted laws and regulations, assessments of
contamination and surrounding geology, quality of information available,
currently available technologies for treatment, alternative methods of
remediation and prior experience. These accrual estimates are subject to
significant change, and are adjusted as the remediation treatment progresses,
as circumstances change and as these contingencies become more clearly defined
and reasonably estimable.

As of
December 31, 2008, we had accrued $13.5 million as managements best estimate
of the net fair value of reasonably estimable environmental remediation costs
which is comprised of $17.7 million of estimated environmental obligations and
liabilities offset by $4.2 million of estimated recoveries from state UST
remediation funds, net of allowance. Environmental expenditures, net of
recoveries from UST funds, were $5.0 million, $4.7 million and $3.0 million,
respectively, for 2008, 2007 and 2006. For 2008, 2007 and 2006, the net change
in estimated remediation cost and accretion expense included in our
consolidated statements of operations amounted to $4.7 million, $5.1 million
and $3.2 million, respectively, which amounts were net of probable recoveries
from state UST remediation funds.

Environmental
liabilities and related assets are currently measured at fair value based on
their expected future cash flows which have been adjusted for inflation and
discounted to present value. We also use probability weighted alternative cash
flow forecasts to determine fair value. We assumed a 50% probability factor
that the actual environmental expenses will exceed engineering estimates for an
amount assumed to equal one year of net expenses aggregating $4.9 million.
Accordingly, the environmental accrual as of December 31, 2008 was increased by
$1.9 million, net of assumed recoveries and before inflation and present value
discount adjustments. The resulting net environmental accrual as of December
31, 2008 was then further increased by $0.9 million for the assumed impact of
inflation using an inflation rate of 2.75%. Assuming a credit-adjusted
risk-free discount rate of 7.0%, we then reduced the net environmental accrual,
as previously adjusted, by a $1.9 million discount to present value. Had we
assumed an inflation rate that was 0.5% higher and a discount rate that was
0.5% lower, net environmental liabilities as of December 31, 2008 would have
increased by $0.2 million and $0.1 million, respectively, for an aggregate

42

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increase in
the net environmental accrual of $0.3 million. However, the aggregate net
change in environmental estimates expense recorded during the year ended
December 31, 2008 would not have changed significantly if these changes in the
assumptions were made effective December 31, 2007.

In view of
the uncertainties associated with environmental expenditures, contingencies
concerning the developments related to Marketing and the Marketing Leases and
contingencies related to other parties, however, we believe it is possible that
the fair value of future actual net expenditures could be substantially higher
than these estimates. (See  General  Developments related to Marketing and
the Marketing Leases above for additional information.) Adjustments to accrued
liabilities for environmental remediation costs will be reflected in our
financial statements as they become probable and a reasonable estimate of fair
value can be made. Future environmental costs could cause a material adverse
effect on our business, financial condition, results of operations, liquidity,
ability to pay dividends and/or stock price.

We cannot
predict what environmental legislation or regulations may be enacted in the
future or how existing laws or regulations will be administered or interpreted
with respect to products or activities to which they have not previously been
applied. We cannot predict if state UST fund programs will be administered and
funded in the future in a manner that is consistent with past practices and if
future environmental spending will continue to be eligible for reimbursement at
historical recovery rates under these programs. Compliance with more stringent
laws or regulations, as well as more vigorous enforcement policies of the
regulatory agencies or stricter interpretation of existing laws, which may
develop in the future, could have an adverse effect on our financial position,
or that of our tenants, and could require substantial additional expenditures
for future remediation.

Environmental litigation

We are
subject to various legal proceedings and claims which arise in the ordinary
course of our business. In addition, we have retained responsibility for
certain legal proceedings and claims relating to the petroleum marketing business
that were identified at the time of the Spin-Off. As of December 31, 2008 and
2007, we had accrued $1.7 million and $2.6 million, respectively, for certain
of these matters which we believe were appropriate based on information then
currently available. It is possible that our assumptions regarding the ultimate
allocation method and share of responsibility that we used to allocate
environmental liabilities may change, which may result in our providing an
accrual, or adjustments to the amounts recorded, for environmental litigation
accruals. (For additional information with respect to pending environmental
lawsuits and claims see Item 3. Legal Proceedings.)

In
September 2003, we were notified by the State of New Jersey Department of
Environmental Protection (the NJDEP) that we are one of approximately
sixty-six potentially responsible parties for natural resource damages
resulting from discharges of hazardous substances into the Lower Passaic River.
The definitive list of potentially responsible parties and their actual
responsibility for the alleged damages, the aggregate cost to remediate the
Lower Passaic River, the amount of natural resource damages and the method of
allocating such amounts among the potentially responsible parties have not been
determined. In September 2004, we received a General Notice Letter from the
United States Environmental Protection Agency (the EPA) (the EPA Notice),
advising us that we may be a potentially responsible party for costs of
remediating certain conditions resulting from discharges of hazardous
substances into the Lower Passaic River. ChevronTexaco received the same EPA
Notice regarding those same conditions. In a related action, in December 2005,
the State of New Jersey brought suit against certain companies which the State
alleges are responsible for pollution of the Passaic River from a former
Diamond Alkali manufacturing plant. In February 2009, certain of these
defendants filed third-party complaints against approximately 300 additional
parties, including us, seeking contribution for a pro-rata share of response
costs, cleanup and removal costs, and other damages. Additionally, we believe
that ChevronTexaco is contractually obligated to indemnify us, pursuant to an
indemnification agreement for most of the conditions at the property identified
by the NJDEP and the EPA; accordingly, our ultimate legal and financial
liability, if any, cannot be estimated with any certainty at this time.

From
October 2003 through December 31, 2008, we were notified that we were made
party to fifty-four cases in Connecticut, Florida, Massachusetts, New
Hampshire, New Jersey, New York, Pennsylvania, Vermont, Virginia and West
Virginia brought by local water providers or governmental agencies. These cases
allege various theories of liability due to contamination of groundwater with
methyl tertiary butyl ether (MTBE) as the basis for claims seeking
compensatory and punitive damages. Each case names as defendants approximately
fifty petroleum refiners,

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manufacturers, distributors and retailers of MTBE, or gasoline
containing MTBE. At this time, we have been dismissed from certain of the cases
initially filed against us. A significant number of the named defendants other
than us have entered into settlements with certain plaintiffs, which affected
approximately twenty-seven of the cases to which we are a party. The accuracy
of the allegations as they relate to us, our defenses to such claims, the
aggregate amount of possible damages, and the method of allocating such amounts
among the remaining defendants have not been determined. Accordingly, our
ultimate legal and financial liability, if any, cannot be estimated with any
certainty at this time.

Item 7A. Quantitative and Qualitative
Disclosures about Market Risk

Prior to
April 2006, when we entered into the a Swap Agreement with JPMorgan Chase, N.A.
(the Swap Agreement), we had not used derivative financial or commodity
instruments for trading, speculative or any other purpose, and had not entered
into any instruments to hedge our exposure to interest rate risk. We do not
have any foreign operations, and are therefore not exposed to foreign currency
exchange rate risks.

We are
exposed to interest rate risk, primarily as a result of our $175.0 million
Credit Agreement. Our Credit Agreement, which expires in March 2011, permits
borrowings at an interest rate equal to the sum of a base rate plus a margin of
0.0% or 0.25% or a LIBOR rate plus a margin of 1.0%, 1.25% or 1.5%. The
applicable margin is based on our leverage ratio at the end of the prior
calendar quarter, as defined in the Credit Agreement, and is adjusted effective
mid-quarter when our quarterly financial results are reported to the Bank
Syndicate. Based on our leverage ratio as of December 31, 2008, the applicable
margin is 0.0% for base rate borrowings and will increase to 1.25% in the first
quarter of 2009 for our LIBOR rate borrowings.

Total
borrowings outstanding under the Credit Agreement at December 31, 2008 were
$130.3 million, bearing interest at a weighted-average rate of 3.3% per annum,
or a weighted-average effective rate of 3.8% including the impact of the Swap
Agreement discussed below. The weighted-average effective rate is based on
$85.3 million of LIBOR rate borrowings floating at market rates plus a margin
of 1.0% and $45.0 million of LIBOR rate borrowings effectively fixed at 5.44%
by the Swap Agreement plus a margin of 1.0%. We use borrowings under the Credit
Agreement to finance acquisitions and for general corporate purposes.

We manage
our exposure to interest rate risk by minimizing, to the extent feasible, our
overall borrowing and monitoring available financing alternatives. Our interest
rate risk as of December 31, 2008 has not increased significantly, as compared
to December 31, 2007. We entered into a $45.0 million LIBOR based interest rate
Swap Agreement, effective through June 30, 2011, to manage a portion of our
interest rate risk. The Swap Agreement is intended to hedge $45.0 million of our
current exposure to variable interest rate risk by effectively fixing, at
5.44%, the LIBOR component of the interest rate determined under our existing
Credit Agreement or future exposure to variable interest rate risk due to
borrowing arrangements that may be entered into prior to the expiration of the
Swap Agreement. As a result of the Swap Agreement, as of December 31, 2008,
$45.0 million of our LIBOR based borrowings under the Credit Agreement bear
interest at an effective rate of 6.44%. As a result, we are, and will be,
exposed to interest rate risk to the extent that our borrowings exceed the
$45.0 million notional amount of the Swap Agreement. As of December 31, 2008,
our borrowings exceeded the notional amount of the Swap Agreement by $85.3 million.
We do not foresee any significant changes in how we manage our interest rate
risk in the near future.

We entered
into the $45.0 million notional five year interest rate Swap Agreement,
designated and qualifying as a cash flow hedge to reduce our exposure to the
variability in future cash flows attributable to changes in the LIBOR rate. Our
primary objective when undertaking hedging transactions and derivative
positions is to reduce our variable interest rate risk by effectively fixing a
portion of the interest rate for existing debt and anticipated refinancing
transactions. This in turn, reduces the risks that the variability of cash
flows imposes on variable rate debt. Our strategy protects us against future
increases in interest rates. Although the Swap Agreement is intended to lessen
the impact of rising interest rates, it also exposes us to the risk that the
other party to the agreement will not perform, the agreement will be
unenforceable and the underlying transactions will fail to qualify as a
highly-effective cash flow hedge for accounting purposes.

In the
event that we were to settle the Swap Agreement prior to its maturity, if the
corresponding LIBOR swap rate for the remaining term of the Swap Agreement is
below the 5.44% fixed strike rate at the time we settle the

44

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Swap Agreement, we would be required to make a payment to the Swap
Agreement counter-party; if the corresponding LIBOR swap rate is above the
fixed strike rate at the time we settle the Swap Agreement, we would receive a
payment from the Swap Agreement counter-party. The amount that we would either
pay or receive would equal the present value of the basis point differential
between the fixed strike rate and the corresponding LIBOR swap rate at the time
we settle the Swap Agreement.

Based on
our average outstanding borrowings under the Credit Agreement projected at
$133.6 million for 2009, an increase in market interest rates of 0.5% for 2009
would decrease our 2009 net income and cash flows by $0.4 million. This amount
was determined by calculating the effect of a hypothetical interest rate change
on our Credit Agreement borrowings that is not covered by our $45.0 million
interest rate Swap Agreement and assumes that the $133.6 million average
outstanding borrowings during the fourth quarter of 2008 is indicative of our
future average borrowings for 2009 before considering additional borrowings
required for future acquisitions. The calculation also assumes that there are
no other changes in our financial structure or the terms of our borrowings. Our
exposure to fluctuations in interest rates will increase or decrease in the
future with increases or decreases in the outstanding amount under our Credit
Agreement.

In order to
minimize our exposure to credit risk associated with financial instruments, we
place our temporary cash investments with high-credit-quality institutions.
Temporary cash investments, if any, are held in an overnight bank time deposit
with JPMorgan Chase Bank, N.A.

Item 8. Financial Statements and
Supplementary Data

GETTY REALTY CORP. INDEX TO FINANCIAL
STATEMENTS AND
SUPPLEMENTARY DATA

|                                                                                                                                                |  |        
|----------------------------------------------------------------------------------------------------------------------------------------------- |  | -------
|                                                                                                                                                |  | (PAGES)
|                                                                                                                                                |  |        
|                                                                                                                                               
|Consolidated Statements of Operations for
 the years ended December 31, 2008, 2007 and 2006                                                     |  | 46     
|Consolidated Statements of Comprehensive
 Income for the years ended December 31, 2008, 2007 and 2006                                           |  | 46     
|Consolidated Balance Sheets as of December
 31, 2008 and 2007                                                                                   |  | 47     
|Consolidated Statements of Cash Flows for
 the years ended December 31, 2008, 2007 and 2006                                                     |  | 48     
|Notes to Consolidated Financial Statements
 (including the supplementary financial information contained in Note 9
 Quarterly Financial Data) |  | 49     
|Report of Independent Registered Public
 Accounting Firm                                                                                        |  | 64     

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GETTY REALTY CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)

|                                                          |  |                          |        |      |   |        |   |   |        |  
|--------------------------------------------------------- |  | ------------------------ | ------ | ---- | - | ------ | - | - | ------ | -
|                                                          |  | YEAR
 ENDED DECEMBER 31, |       
|                                                          |  |                          |       
|                                                          |  | 2008                     |        | 2007 |   | 2006   |  
|                                                          |  |                          |        |      |   |        |  
|Revenues from rental properties                           |  | $                        | 81,163 |      | $ | 78,069 |   | $ | 71,329 |  
|Operating expenses:                                       |  |                          |        |      |   |        |   |   |        |  
|Rental property expenses                                  |  |                          | 9,390  |      |   | 9,301  |   |   | 9,619  |  
|Environmental expenses, net                               |  |                          | 7,374  |      |   | 8,190  |   |   | 5,418  |  
|General and administrative expenses                       |  |                          | 6,831  |      |   | 6,669  |   |   | 5,607  |  
|Allowance for deferred rent receivable                    |  |                          |       |      |   | 10,312 |   |   |       |  
|Depreciation and amortization expense                     |  |                          | 11,784 |      |   | 9,647  |   |   | 7,785  |  
|                                                          |  |                          |        |      |   |        |   |   |        |  
|Total expenses                                            |  |                          | 35,379 |      |   | 44,119 |   |   | 28,429 |  
|                                                          |  |                          |        |      |   |        |   |   |        |  
|Operating income                                          |  |                          | 45,784 |      |   | 33,950 |   |   | 42,900 |  
|Other income, net                                         |  |                          | 412    |      |   | 1,920  |   |   | 1,855  |  
|Interest expense                                          |  |                          | (7,034 | )    |   | (7,760 | ) |   | (3,527 | )
|                                                          |  |                          |        |      |   |        |   |   |        |  
|Earnings before income taxes and
 discontinued operations |  |                          | 39,162 |      |   | 28,110 |   |   | 41,228 |  
|Income tax benefit                                        |  |                          |       |      |   |       |   |   | 700    |  
|                                                          |  |                          |        |      |   |        |   |   |        |  
|Earnings from continuing operations                       |  |                          | 39,162 |      |   | 28,110 |   |   | 41,928 |  
|Discontinued operations:                                  |  |                          |        |      |   |        |   |   |        |  
|Earnings from operating activities                        |  |                          | 259    |      |   | 1,216  |   |   | 793    |  
|Gains on dispositions of real estate                      |  |                          | 2,389  |      |   | 4,568  |   |   | 4      |  
|                                                          |  |                          |        |      |   |        |   |   |        |  
|Earnings from discontinued operations                     |  |                          | 2,648  |      |   | 5,784  |   |   | 797    |  
|                                                          |  |                          |        |      |   |        |   |   |        |  
|Net earnings                                              |  | $                        | 41,810 |      | $ | 33,894 |   | $ | 42,725 |  
|                                                          |  |                          |        |      |   |        |   |   |        |  
|Basic earnings per common share:                          |  |                          |        |      |   |        |   |   |        |  
|Earnings from continuing operations                       |  | $                        | 1.58   |      | $ | 1.14   |   | $ | 1.70   |  
|Earnings from discontinued operations                     |  | $                        | .11    |      | $ | .23    |   | $ | .03    |  
|Net earnings                                              |  | $                        | 1.69   |      | $ | 1.37   |   | $ | 1.73   |  
|Diluted earnings per common share:                        |  |                          |        |      |   |        |   |   |        |  
|Earnings from continuing operations                       |  | $                        | 1.58   |      | $ | 1.13   |   | $ | 1.69   |  
|Earnings from discontinued operations                     |  | $                        | .11    |      | $ | .23    |   | $ | .03    |  
|Net earnings                                              |  | $                        | 1.69   |      | $ | 1.37   |   | $ | 1.73   |  
|Weighted average shares outstanding:                      |  |                          |        |      |   |        |   |   |        |  
|Basic                                                     |  |                          | 24,766 |      |   | 24,765 |   |   | 24,735 |  
|Stock options and restricted stock units                  |  |                          | 8      |      |   | 22     |   |   | 24     |  
|                                                          |  |                          |        |      |   |        |   |   |        |  
|Diluted                                                   |  |                          | 24,774 |      |   | 24,787 |   |   | 24,759 |  
|                                                          |  |                          |        |      |   |        |   |   |        |  
|Dividends declared per share                              |  | $                        | 1.87   |      | $ | 1.85   |   | $ | 1.82   |  

GETTY REALTY CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)

|                                          |  |                          |        |      |   |        |   |   |        |  
|----------------------------------------- |  | ------------------------ | ------ | ---- | - | ------ | - | - | ------ | -
|                                          |  | YEAR
 ENDED DECEMBER 31, |       
|                                          |  |                          |       
|                                          |  | 2008                     |        | 2007 |   | 2006   |  
|                                          |  |                          |        |      |   |        |  
|Net earnings                              |  | $                        | 41,810 |      | $ | 33,894 |   | $ | 42,725 |  
|Other comprehensive loss:                 |  |                          |        |      |   |        |   |   |        |  
|Net unrealized loss on interest rate swap |  |                          | (1,997 | )    |   | (1,478 | ) |   | (821   | )
|                                          |  |                          |        |      |   |        |   |   |        |  
|Comprehensive Income                      |  | $                        | 39,813 |      | $ | 32,416 |   | $ | 41,904 |  
|                                          |  |                          |        |      |   |        |   |   |        |  

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

46

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GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)

|                                                                                                                                                   |  |               |          |      |   |          |  
|-------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------- | -------- | ---- | - | -------- | -
|                                                                                                                                                   |  | DECEMBER
 31, |         
|                                                                                                                                                   |  |               |         
|                                                                                                                                                   |  | 2008          |          | 2007 |  
|                                                                                                                                                   |  |               |          |      |  
|ASSETS:                                                                                                                                            |  |               |          |      |   |          |  
|Real Estate:                                                                                                                                       |  |               |          |      |   |          |  
|Land                                                                                                                                               |  | $             | 221,540  |      | $ | 222,194  |  
|Buildings and
 improvements                                                                                                                        |  |               | 252,027  |      |   | 252,060  |  
|                                                                                                                                                   |  |               |          |      |   |          |  
|                                                                                                                                                   |  |               | 473,567  |      |   | 474,254  |  
|Less 
 accumulated depreciation and amortization                                                                                                  |  |               | (129,322 | )    |   | (122,465 | )
|                                                                                                                                                   |  |               |          |      |   |          |  
|Real estate, net                                                                                                                                   |  |               | 344,245  |      |   | 351,789  |  
|Deferred rent
 receivable (net of allowance of $10,029 at December 31, 2008 and $10,494 at
 December 31, 2007)                                     |  |               | 26,718   |      |   | 24,915   |  
|Cash and cash
 equivalents                                                                                                                         |  |               | 2,178    |      |   | 2,071    |  
|Recoveries from
 state underground storage tank funds, net                                                                                         |  |               | 4,223    |      |   | 4,652    |  
|Mortgages and
 accounts receivable, net                                                                                                            |  |               | 1,533    |      |   | 1,473    |  
|Prepaid expenses
 and other assets                                                                                                                 |  |               | 8,916    |      |   | 12,011   |  
|                                                                                                                                                   |  |               |          |      |   |          |  
|Total assets                                                                                                                                       |  | $             | 387,813  |      | $ | 396,911  |  
|                                                                                                                                                   |  |               |          |      |   |          |  
|LIABILITIES AND
 SHAREHOLDERS EQUITY:                                                                                                             |  |               |          |      |   |          |  
|Debt                                                                                                                                               |  | $             | 130,250  |      | $ | 132,500  |  
|Environmental
 remediation costs                                                                                                                   |  |               | 17,660   |      |   | 18,523   |  
|Dividends
 payable                                                                                                                                 |  |               | 11,669   |      |   | 11,534   |  
|Accounts payable
 and accrued expenses                                                                                                             |  |               | 22,337   |      |   | 22,176   |  
|                                                                                                                                                   |  |               |          |      |   |          |  
|Total
 liabilities                                                                                                                                 |  |               | 181,916  |      |   | 184,733  |  
|                                                                                                                                                   |  |               |          |      |   |          |  
|Commitments and
 contingencies (notes 2, 3, 5 and 6)                                                                                               |  |               |          |      |   |          |  
|Shareholders
 equity:                                                                                                                             |  |               |          |      |   |          |  
|Common stock,
 par value $.01 per share; authorized 50,000,000 shares; issued 24,766,166 at
 December 31, 2008 and 24,765,065 at December 31, 2007 |  |               | 248      |      |   | 248      |  
|Paid-in capital                                                                                                                                    |  |               | 259,069  |      |   | 258,734  |  
|Dividends paid
 in excess of earnings                                                                                                              |  |               | (49,124  | )    |   | (44,505  | )
|Accumulated
 other comprehensive loss                                                                                                              |  |               | (4,296   | )    |   | (2,299   | )
|                                                                                                                                                   |  |               |          |      |   |          |  
|Total
 shareholders equity                                                                                                                        |  |               | 205,897  |      |   | 212,178  |  
|                                                                                                                                                   |  |               |          |      |   |          |  
|Total
 liabilities and shareholders equity                                                                                                        |  | $             | 387,813  |      | $ | 396,911  |  
|                                                                                                                                                   |  |               |          |      |   |          |  

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

47

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GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

|                                                                                              |  |                          |         |      |   |         |   |   |         |  
|--------------------------------------------------------------------------------------------- |  | ------------------------ | ------- | ---- | - | ------- | - | - | ------- | -
|                                                                                              |  | YEAR
 ENDED DECEMBER 31, |        
|                                                                                              |  |                          |        
|                                                                                              |  | 2008                     |         | 2007 |   | 2006    |  
|                                                                                              |  |                          |         |      |   |         |  
|CASH FLOWS FROM
 OPERATING ACTIVITIES:                                                        |  |                          |         |      |   |         |   |   |         |  
|Net earnings                                                                                  |  | $                        | 41,810  |      | $ | 33,894  |   | $ | 42,725  |  
|Adjustments to
 reconcile net earnings to net cash flow provided by operating activities:     |  |                          |         |      |   |         |   |   |         |  
|Depreciation and
 amortization expense                                                        |  |                          | 11,875  |      |   | 9,794   |   |   | 7,883   |  
|Gain on
 dispositions of real estate                                                          |  |                          | (2,787  | )    |   | (6,179  | ) |   | (1,581  | )
|Deferred rental
 revenue                                                                      |  |                          | (1,803  | )    |   | (3,112  | ) |   | (3,010  | )
|Allowance for
 deferred rent receivable                                                       |  |                          |        |      |   | 10,494  |   |   |        |  
|Amortization of
 above-market and below-market leases                                         |  |                          | (790    | )    |   | (1,047  | ) |   |        |  
|Accretion
 expense                                                                            |  |                          | 956     |      |   | 974     |   |   | 923     |  
|Stock-based
 employee compensation expense                                                    |  |                          | 326     |      |   | 492     |   |   | 186     |  
|Changes in
 assets and liabilities:                                                           |  |                          |         |      |   |         |   |   |         |  
|Recoveries from
 state underground storage tank funds, net                                    |  |                          | 827     |      |   | (379    | ) |   | 772     |  
|Mortgages and
 accounts receivable, net                                                       |  |                          | (5      | )    |   | 44      |   |   | (172    | )
|Prepaid expenses
 and other assets                                                            |  |                          | 423     |      |   | (130    | ) |   | 170     |  
|Environmental
 remediation costs                                                              |  |                          | (2,217  | )    |   | (80     | ) |   | (1,425  | )
|Accounts payable
 and accrued expenses                                                        |  |                          | (1,031  | )    |   | (249    | ) |   | 545     |  
|Accrued income
 taxes                                                                         |  |                          |        |      |   |        |   |   | (700    | )
|                                                                                              |  |                          |         |      |   |         |   |   |         |  
|Net cash flow
 provided by operating activities                                               |  |                          | 47,584  |      |   | 44,516  |   |   | 46,316  |  
|                                                                                              |  |                          |         |      |   |         |   |   |         |  
|CASH FLOWS FROM
 INVESTING ACTIVITIES:                                                        |  |                          |         |      |   |         |   |   |         |  
|Property
 acquisitions and capital expenditures                                               |  |                          | (6,579  | )    |   | (90,636 | ) |   | (15,538 | )
|Proceeds from
 dispositions of real estate                                                    |  |                          | 5,295   |      |   | 8,420   |   |   | 2,462   |  
|(Increase)
 decrease in cash held for property acquisitions                                   |  |                          | 2,397   |      |   | (2,079  | ) |   | (465    | )
|Collection
 (issuance) of mortgages receivable, net                                           |  |                          | (55     | )    |   | 267     |   |   | 326     |  
|                                                                                              |  |                          |         |      |   |         |   |   |         |  
|Net cash flow
 provided by (used in) investing activities                                     |  |                          | 1,058   |      |   | (84,028 | ) |   | (13,215 | )
|                                                                                              |  |                          |         |      |   |         |   |   |         |  
|CASH FLOWS FROM
 FINANCING ACTIVITIES:                                                        |  |                          |         |      |   |         |   |   |         |  
|Borrowings
 (repayments) under credit agreement, net                                          |  |                          | (2,250  | )    |   | 87,500  |   |   | 11,000  |  
|Cash dividends
 paid                                                                          |  |                          | (46,294 | )    |   | (45,650 | ) |   | (44,819 | )
|Credit agreement
 origination costs                                                           |  |                          |        |      |   | (863    | ) |   |        |  
|Cash paid in
 settlement of restricted stock units                                            |  |                          |        |      |   | (405    | ) |   |        |  
|Repayment of
 mortgages payable, net                                                          |  |                          |        |      |   | (194    | ) |   | (30     | )
|Proceeds from
 exercise of stock options                                                      |  |                          | 9       |      |   |        |   |   | 696     |  
|                                                                                              |  |                          |         |      |   |         |   |   |         |  
|Net cash flow
 provided by (used in) financing activities                                     |  |                          | (48,535 | )    |   | 40,388  |   |   | (33,153 | )
|                                                                                              |  |                          |         |      |   |         |   |   |         |  
|Net increase
 (decrease) in cash and cash equivalents                                         |  |                          | 107     |      |   | 876     |   |   | (52     | )
|Cash and cash
 equivalents at beginning of year                                               |  |                          | 2,071   |      |   | 1,195   |   |   | 1,247   |  
|                                                                                              |  |                          |         |      |   |         |   |   |         |  
|Cash and cash
 equivalents at end of year                                                     |  | $                        | 2,178   |      | $ | 2,071   |   | $ | 1,195   |  
|                                                                                              |  |                          |         |      |   |         |   |   |         |  
|Supplemental
 disclosures of cash flow information Cash paid (refunded) during the year
 for: |  |                          |         |      |   |         |   |   |         |  
|Interest                                                                                      |  | $                        | 6,728   |      | $ | 7,021   |   | $ | 2,638   |  
|Income taxes,
 net                                                                            |  |                          | 708     |      |   | 488     |   |   | 576     |  
|Recoveries from
 state underground storage tank funds                                         |  |                          | (1,511  | )    |   | (1,644  | ) |   | (2,128  | )
|Environmental
 remediation costs                                                              |  |                          | 6,542   |      |   | 6,314   |   |   | 5,132   |  

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

48

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GETTY REALTY CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis
of Presentation: The accompanying consolidated financial statements have been
prepared in conformity with accounting principles generally accepted in the
United States of America (GAAP). The consolidated financial statements
include the accounts of Getty Realty Corp. and its wholly-owned subsidiaries
(the Company). The Company is a real estate investment trust (REIT)
specializing in the ownership and leasing of retail motor fuel and convenience
store properties and petroleum distribution terminals. The Company manages and
evaluates its operations as a single segment. All significant inter-company
accounts and transactions have been eliminated.

Use
of Estimates, Judgments and Assumptions: The financial statements have been
prepared in conformity with GAAP, which requires the Companys management to
make its best estimates, judgments and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and revenues and expenses
during the period reported. While all available information has been
considered, actual results could differ from those estimates, judgments and
assumptions. Estimates, judgments and assumptions underlying the accompanying
consolidated financial statements include, but are not limited to, deferred
rent receivable, recoveries from state underground storage tank (UST or
USTs) funds, environmental remediation costs, real estate, depreciation and
amortization, impairment of long-lived assets, litigation, accrued expenses,
income taxes and the allocation of the purchase price of properties acquired to
the assets acquired and liabilities assumed.

Discontinued
Operations: The operating results and gains from certain dispositions of real
estate sold in 2008 and 2007 have been reclassified as discontinued operations.
The results of such properties for the years ended 2007 and 2006 have been
reclassified to discontinued operations to conform to the 2008 presentation.
Discontinued operations for the year ended December 31, 2008 and 2007 are
primarily comprised of gains from property dispositions. The revenue from
rental properties and expenses related to the operations of these properties are
insignificant for the each of the three years ended December 31, 2008, 2007 and
2006.

Real
Estate: Real estate assets are stated at cost less accumulated depreciation and
amortization. Upon acquisition of real estate operating properties and leasehold
interests, the Company estimates the fair value of acquired tangible assets
(consisting of land, buildings and improvements) as if vacant and identified
intangible assets and liabilities (consisting of leasehold interests,
above-market and below-market leases, in-place leases and tenant relationships)
and assumed debt. Based on these estimates, the Company allocates the purchase
price to the applicable assets and liabilities. When real estate assets are
sold or retired, the cost and related accumulated depreciation and amortization
is eliminated from the respective accounts and any gain or loss is credited or
charged to income. Expenditures for maintenance and repairs are charged to
income when incurred.

Depreciation
and amortization: Depreciation of real estate is computed on the straight-line
method based upon the estimated useful lives of the assets, which generally
range from sixteen to twenty-five years for buildings and improvements, or the
term of the lease if shorter. Leasehold interests, capitalized above-market and
below-market leases, in-place leases and tenant relationships are amortized
over the remaining term of the underlying lease.

Impairment
of Long-Lived Assets and Long-Lived Assets to Be Disposed Of: Assets are written
down to fair value (determined on a nonrecurring basis using a discounted cash
flow method and significant unobservable inputs) when events and circumstances
indicate that the assets might be impaired and the projected undiscounted cash
flows estimated to be generated by those assets are less than the carrying
amount of those assets. The Company reviews and adjusts as necessary its
depreciation estimates and method when long-lived assets are tested for
recoverability. Assets held for disposal are written down to fair value less
disposition costs.

Cash
and Cash Equivalents: The Company considers highly liquid investments purchased
with an original maturity of three months or less to be cash equivalents.

Deferred
Rent Receivable and Revenue Recognition: The Company earns rental income under
operating leases with tenants. Minimum lease rentals and lease termination
payments are recognized on a straight-line basis over the

49

---



term of the leases. The
cumulative difference between lease revenue recognized under this method and
the contractual lease payment terms is recorded as deferred rent receivable on
the consolidated balance sheet. Lease termination fees are recognized as rental
income when earned upon the termination of a tenants lease and relinquishment
of space in which the Company has no further obligation to the tenant. The
present value of the difference between the fair market rent and the
contractual rent for in-place leases at the time properties are acquired is
amortized into revenue from rental properties over the remaining lives of the
in-place leases. The Company provides reserves for a portion of the recorded
deferred rent receivable if circumstances indicate that a property may be
disposed of before the end of the current lease term or if it is not reasonable
to assume that the tenant will not make all of its contractual lease payments
when due during the current term of the lease. The straight-line method
requires that rental income related to those properties for which a reserve was
provided is effectively recognized in subsequent periods when payment is due
under the contractual payment terms.

Environmental
Remediation Costs and Recoveries from State UST Funds, Net: The estimated
future costs for known environmental remediation requirements are accrued when
it is probable that a liability has been incurred, including legal obligations
associated with the retirement of tangible long-lived assets if the asset
retirement obligation results from the normal operation of those assets and a
reasonable estimate of fair value can be made. The environmental remediation
liability is estimated based on the level and impact of contamination at each
property. The accrued liability is the aggregate of the best estimate of the
fair value of cost for each component of the liability. Recoveries of
environmental costs from state UST remediation funds, with respect to both past
and future environmental spending, are accrued at fair value as an offset to
environmental expense, net of allowance for collection risk, based on estimated
recovery rates developed from prior experience with the funds when such
recoveries are considered probable. Environmental liabilities and related
assets are currently measured based on their expected future cash flows which
have been adjusted for inflation and discounted to present value. The Company
will accrue for environmental liabilities that it believes are allocable to
other potentially responsible parties if it becomes probable that the other parties
will not pay their environmental obligations.

Litigation:
Legal fees related to litigation are expensed as legal services are performed.
The Company provides for litigation reserves, including certain litigation
related to environmental matters, when it is probable that a liability has been
incurred and a reasonable estimate of the liability can be made. If the best
estimate of the liability can only be identified as a range, and no amount
within the range is a better estimate than any other amount, the minimum of the
range is accrued for the liability. The Company accrues its share of
environmental liabilities based on its assumptions of the ultimate allocation
method and share that will be used when determining its share of
responsibility.

Income
Taxes: The Company and its subsidiaries file a consolidated federal income tax
return. Effective January 1, 2001, the Company elected to qualify, and believes
it is operating so as to qualify, as a REIT for federal income tax purposes.
Accordingly, the Company generally will not be subject to federal income tax,
provided that distributions to its shareholders equal at least the amount of
its REIT taxable income as defined under the Internal Revenue Code. If the
Company sells any property within ten years after its REIT election that is not
exchanged for a like-kind property, it will be taxed on the built-in gain
realized from such sale at the highest corporate rate. This ten-year built-in
gain tax period will end in 2011.

Interest
Expense and Interest Rate Swap Agreement: In April 2006 the Company entered
into an interest rate swap agreement with JPMorgan Chase Bank, N.A. as the
counterparty, designated and qualifying as a cash flow hedge, to reduce its
variable interest rate risk by effectively fixing a portion of the interest
rate for existing debt and anticipated refinancing transactions. The Company
has not entered into financial instruments for trading or speculative purposes.
The fair value of the derivative is reflected on the consolidated balance sheet
and will be reclassified as a component of interest expense over the remaining
term of the interest rate swap agreement since the Company does not expect to
settle the interest rate swap prior to its maturity. The fair value of the
interest rate swap obligation is based upon the estimated amounts the Company
would receive or pay to terminate the contract and is determined using an
interest rate market pricing model. Changes in the fair value of the agreement
would be recorded in the consolidated statements of operations if the agreement
was not an effective cash flow hedge for accounting purposes.

Earnings
per Common Share: Basic earnings per common share is computed by dividing net
earnings by the weighted-average number of common shares outstanding during the
year. Diluted earnings per common share also

50

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gives effect to the
potential dilution from the exercise of stock options and the issuance of
common shares in settlement of restricted stock units utilizing the treasury
stock method. For the year ended December 31, 2008, the assumed exercise of
stock options utilizing the treasury stock method would have been anti-dilutive
and therefore was not assumed for purposes of computing diluted earnings per
common share.

Stock-Based
Compensation: Compensation cost for the Companys stock-based compensation
plans using the fair value method was $326,000, $492,000 and $186,000 for the
years ended 2008, 2007 and 2006, respectively, and is included in general and
administrative expense. The impact of the accounting for stock-based
compensation is, and is expected to be, immaterial to the Companys financial
position and results of operations.

New
Accounting Pronouncements: In September 2006, the Financial Accounting
Standards Board (FASB) issued Statement of Financial Accounting Standards
(SFAS) No. 157, Fair Value Measurements (SFAS 157). SFAS 157 provides
guidance for using fair value to measure assets and liabilities. SFAS 157
generally applies whenever other standards require assets or liabilities to be
measured at fair value. SFAS 157 is effective in fiscal years beginning after
November 15, 2007. Staff Position (FSP) No. 152, Effective Date of FASB
Statement No. 157, (FSP 152) delayed the effective date of FASB No. 157 by
one year for nonfinancial assets and liabilities that are recognized or
disclosed at fair value on a nonrecurring basis to fiscal years beginning after
November 15, 2008. The adoption of SFAS 157 in January 2008 has not had a material
impact on the Companys financial position and results of operations. The
Company does not believe that the adoption of the provisions of SFAS 157 for
nonfinancial assets and liabilities that are recognized or disclosed at fair
value on a nonrecurring basis will have a material impact on the Companys
financial position and results of operations.

In
December 2007, the FASB issued SFAS No. 141 (revised 2007), Business
Combinations (SFAS 141(R)), which establishes principles and requirements
for how the acquirer shall recognize and measure in its financial statements at
fair value the identifiable assets acquired, liabilities assumed, any
non-controlling interest in the acquiree and goodwill acquired in a business
combination. SFAS 141(R) requires that acquisition costs, which could be
material to the Companys future financial results, will be expensed rather
than included as part of the basis of the acquisition. The adoption of this
standard by the Company on January 1, 2009 will not result in a write-off of
acquisition related transactions costs associated with transactions not yet
consummated. SFAS 141(R) is effective for business combinations for which the
acquisition date is on or after the beginning of the first annual reporting period
beginning on or after December 15, 2008.

2.
LEASES

The
Company leases or sublets its properties primarily to distributors and
retailers engaged in the sale of gasoline and other motor fuel products,
convenience store products and automotive repair services who are responsible
for the payment of taxes, maintenance, repair, insurance and other operating
expenses and for managing the actual operations conducted at these properties.
In addition, approximately twenty of the Companys properties are directly
leased by the Company to others for other uses such as fast food restaurants,
automobile sales and other retail purposes. The Companys properties are
primarily located in the Northeast and Mid-Atlantic regions of the United
States. The Company also owns or leases properties in Texas, North Carolina,
Hawaii, California, Florida, Arkansas, Illinois, North Dakota and Ohio.

As
of December 31, 2008, Getty Petroleum Marketing Inc. (Marketing) leased from
the Company, eight hundred sixty-four properties. Substantially all of the
properties are leased to Marketing under a unitary master lease (the Master
Lease) except for ten properties which are leased under supplemental leases
(collectively the Marketing Leases). As of December 31, 2008, the Marketing
Leases included eight hundred fifty-five retail motor fuel and convenience
store properties and nine distribution terminals, seven hundred ten of the
properties are owned by the Company and one hundred fifty-four of the
properties are leased by the Company from third parties. The Master Lease has
an initial term of fifteen years commencing December 9, 2000, and generally
provides Marketing with options for three renewal terms of ten years each and a
final renewal option of three years and ten months extending to 2049 (or such
shorter initial or renewal term as the underlying lease may provide). The
Marketing Leases include provisions for 2% annual rent escalations. The Master
Lease is a unitary lease and, accordingly, Marketings exercise of renewal
options must be on an all or nothing basis. The supplemental leases have
initial terms of varying expiration dates. As permitted under the terms of the
Companys leases with Marketing, Marketing

51

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can generally use each
property for any lawful purpose, or for no purpose whatsoever. (See footnote 3
for contingencies related to Marketing and the Marketing Leases for additional
information.)

The
Company estimates that Marketing makes annual real estate tax payments for
properties leased under the Marketing Leases of approximately $12.3 million.
Marketing also makes additional payments for other operating expenses related
to these properties, including environmental remediation costs other than those
liabilities that were retained by the Company. These costs, which have been
assumed by Marketing under the terms of the Marketing Leases, are not reflected
in the consolidated financial statements.

Revenues
from rental properties for the years ended December 31, 2008, 2007 and 2006 were
$81,163,000, $78,069,000 and $71,329,000, respectively, of which $60,440,000,
$59,669,000 and $59,482,000, respectively, were received from Marketing under
the Marketing Leases. In addition, revenues from rental properties for the
years ended December 31, 2008, 2007 and 2006 include $2,537,000, 3,605,000 and
$2,982,000, respectively, of deferred rental revenue accrued due to recognition
of rental revenue on a straight-line basis and amortization of above-market and
below-market leases. In the fourth quarter and year ended December 31, 2007,
the Company provided a non-cash $10.5 million reserve for a portion of the
deferred rent receivable recorded as of December 31, 2007 related to the
Marketing Leases. (See footnote 3 for additional information related to the
Marketing Leases and the reserve.)

Future
contractual minimum annual rentals receivable from Marketing under the
Marketing Leases and from other tenants, which have terms in excess of one year
as of December 31, 2008, are as follows (in thousands. See footnote 3 for
additional information related to the Marketing Leases and the reserve):

|                         |  |           |         |                |  |            |  |  |         | 
|------------------------ |  | --------- | ------- | -------------- |  | ---------- |  |  | ------- | 
|YEAR ENDING DECEMBER 31, |  | MARKETING |         | OTHER
 TENANTS |  | TOTAL
 (a) | 
|                         |  |           |         |                |  |            | 
|2009                     |  |           | 60,003  |                |  | 18,938     |  |  | 78,941  | 
|2010                     |  |           | 59,968  |                |  | 18,722     |  |  | 78,690  | 
|2011                     |  |           | 60,086  |                |  | 18,769     |  |  | 78,855  | 
|2012                     |  |           | 60,402  |                |  | 18,588     |  |  | 78,990  | 
|2013                     |  |           | 60,508  |                |  | 18,006     |  |  | 78,514  | 
|Thereafter               |  |           | 118,946 |                |  | 121,683    |  |  | 240,629 | 

(a) Includes $78,441,000 of future minimum
annual rentals receivable under subleases.

Rent
expense, substantially all of which consists of minimum rentals on
non-cancelable operating leases, amounted to $8,100,000, $8,337,000 and
$8,685,000 for the years ended December 31, 2008, 2007 and 2006, respectively,
and is included in rental property expenses using the straight-line method.
Rent received under subleases for the years ended December 31, 2008, 2007 and
2006 was $13,986,000, $14,145,000 and $14,646,000, respectively.

The
Company has obligations to lessors under non-cancelable operating leases which
have terms (excluding renewal term options) in excess of one year, principally
for gasoline stations and convenience stores. Substantially all of these leases
contain renewal options and rent escalation clauses. The leased properties have
a remaining lease term averaging over ten years, including renewal options.
Future minimum annual rentals payable under such leases, excluding renewal
options, are as follows: 2009  $7,338,000, 2010  $5,971,000, 2011 
$4,600,000, 2012  $3,197,000, 2013  $2,038,000 and $3,476,000 thereafter.

3.
COMMITMENTS AND CONTINGENCIES

In
order to minimize the Companys exposure to credit risk associated with
financial instruments, the Company places its temporary cash investments with
high credit quality institutions. Temporary cash investments, if any, are held
in an overnight bank time deposit with JPMorgan Chase Bank, N.A.

As
of December 31, the Company leased eight hundred sixty-four of its one thousand
sixty properties on a long-term triple-net basis to Marketing under the
Marketing Leases (see footnote 2 for additional information). A substantial
portion of the Companys revenues (75% for the year ended December 31, 2008),
are derived from the Marketing Leases. Accordingly, the Companys revenues are
dependent to a large degree on the economic performance of Marketing and of the
petroleum marketing industry, and any factor that adversely affects Marketing,

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or the Companys
relationship with Marketing, may have a material adverse effect on the
Companys business, financial condition, revenues, operating expenses, results
of operations, liquidity, ability to pay dividends and/or stock price.
Marketing operated substantially all of the Companys petroleum marketing
businesses when it was spun-off to the Companys shareholders as a separate
publicly held company in March 1997 (the Spin-Off). In December 2000,
Marketing was acquired by a subsidiary of OAO LUKoil (Lukoil), one of the
largest integrated Russian oil companies. Even though Marketing is a
wholly-owned subsidiary of Lukoil and Lukoil has in prior periods provided
credit enhancement and capital to Marketing, Lukoil is not a guarantor of the
Marketing Leases and there can be no assurance that Lukoil is currently
providing, or will provide, any credit enhancement or additional capital to
Marketing. The Companys financial results depend largely on rental income from
Marketing, and to a lesser extent on rental income from other tenants and;
therefore, are materially dependent upon the ability of Marketing to meet its
rental, environmental and other obligations under the Marketing Leases.
Marketings financial results depend largely on retail petroleum marketing
margins and rental income from its sub-tenants who operate their respective
convenience stores, automotive repair services or other businesses at the
Companys properties. The petroleum marketing industry has been and continues
to be volatile and highly competitive. Marketing has made all required monthly
rental payments under the Marketing Leases when due through March 2009,
although there is no assurance that it will continue to do so.

The
Company has had periodic discussions with representatives of Marketing
regarding potential modifications to the Marketing Leases and, in 2007, during
the course of such discussions, Marketing proposed to (i) remove approximately
40% of the properties (the Subject Properties) from the Marketing Leases and
eliminate payment of rent to the Company, and eliminate or reduce payment of
operating expenses, with respect to the Subject Properties, and (ii) reduce the
aggregate amount of rent payable to the Company for the approximately 60% of
the properties that would remain under the Marketing Leases (the Remaining
Properties). Representatives of Marketing have also indicated to the Company
that they are considering significant changes to Marketings business model. In
light of these developments and the continued deterioration in Marketings
annual financial performance, in March 2008, the Company had decided to attempt
to negotiate with Marketing for a modification of the Marketing Leases which
removes the Subject Properties from the Marketing Leases. The Company has held
periodic discussions with Marketing since March 2008 in its attempt to
negotiate a modification of the Marketing Leases to remove the Subject
Properties. Although the Company continues to remove individual locations from
the Master Lease as mutually beneficial opportunities arise, there has been no
agreement between the Company and Marketing on any principal terms that would
be the basis for a definitive Master Lease modification agreement. If Marketing
ultimately determines that its business strategy is to exit all of the
properties it leases from the Company or to divest a composition of properties
different from the properties comprising the Subject Properties, such as the
revised list of properties provided to the Company by Marketing in the second
quarter of 2008 which includes approximately 45% of the properties Marketing
leases from the Company (the Revised Subject Properties), it is the Companys
intention to cooperate with Marketing in accomplishing those objectives if the
Company determines that it is prudent for it to do so. Any modification of the
Marketing Leases that removes a significant number of properties from the
Marketing Leases would likely significantly reduce the amount of rent the
Company receives from Marketing and increase the Companys operating expenses.
The Company cannot accurately predict if, or when, the Marketing Leases will be
modified or what the terms of any agreement may be if the Marketing Leases are
modified. The Company also cannot accurately predict what actions Marketing and
Lukoil may take, and what the Companys recourse may be, whether the Marketing
Leases are modified or not.

The
Company intends either to re-let or sell any properties removed from the
Marketing Leases and reinvest the realized sales proceeds in new properties.
The Company intends to seek replacement tenants or buyers for properties
removed from the Marketing Leases either individually, in groups of properties,
or by seeking a single tenant for the entire portfolio of properties subject to
the Marketing Leases. Although the Company is the fee or leasehold owner of the
properties subject to the Marketing Leases and the owner of the Getty® brand
and has prior experience with tenants who operate their convenience stores,
automotive repair services or other businesses at its properties; in the event
that properties are removed from the Marketing Leases, the Company cannot
accurately predict if, when, or on what terms, such properties could be re-let
or sold.

Due
to the previously disclosed deterioration in Marketings annual financial
performance, in conjunction with the Companys decision to attempt to negotiate
with Marketing for a modification of the Marketing Leases to remove the Subject
Properties, the Company has decided that it cannot reasonably assume that it
will collect all of the rent due to the Company related to the Subject
Properties for the remainder of the current lease terms. In

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reaching this conclusion,
the Company relied on various indicators, including, but not limited to, the
following financial results of Marketing through the year ended December 31,
2007: (i) Marketings significant operating losses, (ii) its negative cash flow
from operating activities, (iii) its asset impairment charges for
underperforming assets, and (iv) its negative earnings before interest, taxes, depreciation,
amortization and rent payable to the Company. The Company has not received Marketings financial results for the year ended December 31, 2008
prior to the preparation of this Annual Report on Form 10-K.

The
Company recorded a reserve of $10,494,000 in 2007 representing the full amount
of the deferred rent receivable recorded related to the Subject Properties as
of December 31, 2007. Providing the non-cash deferred rent receivable reserve
reduced the Companys net earnings but did not impact the Companys cash flow
from operating activities for 2007. As of December 31, 2008, the Company had a
reserve of $10,029,000 for the deferred rent receivable due from Marketing
representing the full amount of the deferred rent receivable recorded related
to the Subject Properties as of that date. The Company has not provided a
deferred rent receivable reserve related to the Remaining Properties since,
based on the Companys assessments and assumptions, the Company continues to
believe that it is probable that it will collect the deferred rent receivable
related to the Remaining Properties of $22,900,000 as of December 31, 2008 and
that Lukoil will not allow Marketing to fail to perform its rental,
environmental and other obligations under the Marketing Leases. The Company
anticipates that the rental revenue for the Remaining Properties will continue
to be recognized on a straight-line basis. As required by the straight-line method of accounting, beginning with the first quarter of
2008, the rental revenue for the Subject Properties was, and for future periods
is expected to be, effectively recognized when payment is due under the
contractual payment terms. Although the Company has adjusted the estimated
useful lives of certain long-lived assets for the Subject Properties, the
Company believes that no impairment charge was necessary for the Subject
Properties as of December 31, 2008 or December 31, 2007 pursuant to the
provisions of Statement of Financial Accounting Standards No. 144. The impact
to depreciation expense due to adjusting the estimated lives for certain
long-lived assets beginning with the year ended December 31, 2008 was not
material.

Marketing
is directly responsible to pay for (i) remediation of environmental
contamination it causes and compliance with various environmental laws and
regulations as the operator of the Companys properties, and (ii) known and
unknown environmental liabilities allocated to Marketing under the terms of the
Master Lease and various other agreements between Marketing and the Company
relating to Marketings business and the properties subject to the Marketing
Leases (collectively the Marketing Environmental Liabilities). The Company
may ultimately be responsible to directly pay for Marketing Environmental
Liabilities as the property owner if Marketing fails to pay them. Additionally,
the Company will be required to accrue for Marketing Environmental Liabilities
if the Company determines that it is probable that Marketing will not meet its
obligations or if the Companys assumptions regarding the ultimate allocation
methods and share of responsibility that it used to allocate environmental
liabilities changes as a result of the factors discussed above, or otherwise.
However, the Company continues to believe that it is not probable that Marketing
will not pay for substantially all of the Marketing Environmental Liabilities
since the Company believes that Lukoil will not allow Marketing to fail to
perform its rental, environmental and other obligations under the Marketing
Leases and, accordingly, the Company did not accrue for the Marketing
Environmental Liabilities as of December 31, 2008 or 2007. Nonetheless, the
Company has determined that the aggregate amount of the Marketing Environmental
Liabilities (as estimated by the Company based on its assumptions and analysis
of information currently available to it) could be material to the Company if
it was required to accrue for all of the Marketing Environmental Liabilities in
the future since the Company believes that it is reasonably possible that as a
result of such accrual, the Company may not be in compliance with the existing
financial covenants in its Credit Agreement. Such non-compliance could result
in an event of default which, if not cured or waived, could result in the
acceleration of all of the Companys indebtedness under the Credit Agreement.

Should
the Companys assessments, assumptions and beliefs prove to be incorrect, or if
circumstances change, the conclusions reached by the Company may change
relating to (i) whether some or all of the Subject or Remaining Properties are
likely to be removed from the Marketing Leases (ii) recoverability of the
deferred rent receivable for some or all of the Subject or Remaining
Properties, (iii) potential impairment of the Subject or Remaining Properties
and, (iv) Marketings ability to pay the Marketing Environmental Liabilities.
The Company intends to regularly review its assumptions that affect the
accounting for deferred rent receivable; long-lived assets; environmental
litigation accruals; environmental remediation liabilities; and related
recoveries from state underground storage tank funds, which may result in
material adjustments to the amounts recorded for these assets and liabilities,
and as a

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result of which, the
Company may not be in compliance with the financial covenants in its Credit
Agreement. Accordingly, the Company may be required to (i) reserve additional
amounts of the deferred rent receivable related to the Remaining Properties,
(ii) record an impairment charge related to the Subject or Remaining
Properties, or (iii) accrue for Marketing Environmental Liabilities that the
Company believes are allocable to Marketing under the Marketing Leases and
various other agreements as a result of the potential or actual modification of
the Marketing Leases or other factors.

The
Company cannot provide any assurance that Marketing will continue to pay its
debts or meet its rental, environmental or other obligations under the
Marketing Leases prior or subsequent to any potential modification of the
Marketing Leases. In the event that Marketing cannot or will not perform its
rental, environmental or other obligations under the Marketing Leases; if the
Marketing Leases are modified significantly or terminated; if the Company
determines that it is probable that Marketing will not meet its environmental
obligations and the Company accrues for such liabilities; if the Company is
unable to promptly re-let or sell the properties subject to the Marketing
Leases; or, if the Company changes its assumptions that affect the accounting
for rental revenue or Marketing Environmental Liabilities related to the
Marketing Leases and various other agreements; the Companys business,
financial condition, revenues, operating expenses, results of operations,
liquidity, ability to pay dividends and/or stock price may be materially
adversely affected.

The
Company has also agreed to provide limited environmental indemnification to
Marketing, capped at $4,250,000 and expiring in 2010, for certain pre-existing
conditions at six of the terminals which are owned by the Company and leased to
Marketing. Under the agreement, Marketing is obligated to pay the first
$1,500,000 of costs and expenses incurred in connection with remediating any
such pre-existing conditions, Marketing and the Company will share equally the
next $8,500,000 of those costs and expenses and Marketing is obligated to pay
all additional costs and expenses over $10,000,000. The Company has accrued
$300,000 as of December 31, 2008 and 2007 in connection with this
indemnification agreement.

The
Company is subject to various legal proceedings and claims which arise in the
ordinary course of its business. In addition, the Company has retained
responsibility for certain legal proceedings and claims relating to the
petroleum marketing business that were identified at the time of the Spin-Off.
As of December 31, 2008 and 2007, the Company had accrued $1,671,000 and
$2,575,000, respectively, for certain of these matters which it believes were
appropriate based on information then currently available. The Company has not
accrued for approximately $950,000 in costs allegedly incurred by the current
property owner in connection with removal of underground storage tanks (USTs
or UST) and soil remediation at a property that had been leased to and
operated by Marketing. The Company believes Marketing is responsible for such
costs under the terms of the Master Lease and tendered the matter for defense
and indemnification from Marketing, but Marketing has denied its liability for
the claim and its responsibility to defend against and indemnify the Company
for the claim. The Company has filed a third party claim against Marketing for
indemnification in this matter, which claim is currently being actively
litigated. Trial is anticipated to be scheduled for the first quarter of 2009.
It is possible that the Companys assumption that Marketing will be ultimately
responsible for this claim may change, which may result in the Company providing
an accrual for this and other matters.

In
September 2003, the Company was notified by the State of New Jersey Department
of Environmental Protection (NJDEP) that the Company is one of approximately
sixty-six potentially responsible parties for natural resource damages
resulting from discharges of hazardous substances into the Lower Passaic River.
The definitive list of potentially responsible parties and their actual
responsibility for the alleged damages, the aggregate cost to remediate the Lower
Passaic River, the amount of natural resource damages and the method of
allocating such amounts among the potentially responsible parties have not been
determined. In September 2004, the Company received a General Notice Letter
from the United States Environmental Protection Agency (the EPA) (the EPA
Notice), advising the Company that it may be a potentially responsible party
for costs of remediating certain conditions resulting from discharges of
hazardous substances into the Lower Passaic River. ChevronTexaco received the
same EPA Notice regarding those same conditions. In a related action, in
December 2005, the State of New Jersey brought suit against certain companies
which the State alleges are responsible for pollution of the Passaic River from
a former Diamond Alkali manufacturing plant. In February 2009, certain of these
defendants filed third-party complaints against approximately 300 additional
parties, including the Company, seeking contribution for a pro-rata share of
response costs, cleanup and removal costs, and other damages. The Company
believes that ChevronTexaco is contractually obligated to indemnify the
Company, pursuant to an indemnification

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agreement, for most if not all of the conditions at the property
identified by the NJDEP and the EPA. Accordingly, the ultimate legal and
financial liability of the Company, if any, cannot be estimated with any
certainty at this time.

From October
2003 through December 31, 2008, the Company was notified that the Company was
made party to fifty-four cases in Connecticut, Florida, Massachusetts, New
Hampshire, New Jersey, New York, Pennsylvania, Vermont, Virginia and West
Virginia brought by local water providers or governmental agencies. These cases
allege various theories of liability due to contamination of groundwater with
methyl tertiary butyl ether (MTBE) as the basis for claims seeking
compensatory and punitive damages. Each case names as defendants approximately
fifty petroleum refiners, manufacturers, distributors and retailers of MTBE, or
gasoline containing MTBE. At this time, the Company has been dismissed from
certain of the cases initially filed against it. A significant number of the named
defendants other than the Company have entered into settlements with certain
plaintiffs, which affected approximately twenty-seven of the cases to which the
Company is a party. The accuracy of the allegations as they relate to the
Company, the Companys defenses to such claims, the aggregate amount of
possible damages and the method of allocating such amounts among the remaining
defendants have not been determined. Accordingly, the ultimate legal and
financial liability of the Company, if any, cannot be estimated with any
certainty at this time. The ultimate resolution of these matters could cause a
material adverse effect on the Companys business, financial condition, results
of operations, liquidity, ability to pay dividends and/or stock price.

Prior to
the Spin-Off, the Company was self-insured for workers compensation, general
liability and vehicle liability up to predetermined amounts above which
third-party insurance applies. As of December 31, 2008 and 2007, the Companys
consolidated balance sheets included, in accounts payable and accrued expenses,
$290,000 and $310,000, respectively, relating to self-insurance obligations.
The Company estimates its loss reserves for claims, including claims incurred
but not reported, by utilizing actuarial valuations provided annually by its
insurance carriers. The Company is required to deposit funds for substantially
all of these loss reserves with its insurance carriers, and may be entitled to
refunds of amounts previously funded, as the claims are evaluated on an annual
basis. The Companys consolidated statements of operations for the years ended
December 31, 2008, 2007 and 2006 include, in general and administrative
expenses, charges (credits) of $(72,000), $81,000 and ($301,000), respectively,
for self-insurance loss reserve adjustments. Since the Spin-Off, the Company
has maintained insurance coverage subject to certain deductibles.

In order to
qualify as a REIT, among other items, the Company must pay out substantially
all of its earnings and profits (as defined in the Internal Revenue Code) in
cash distributions to shareholders each year. Should the Internal Revenue
Service successfully assert that the Companys earnings and profits were
greater than the amounts distributed, the Company may fail to qualify as a
REIT; however, the Company may avoid losing its REIT status by paying a
deficiency dividend to eliminate any remaining earnings and profits. The
Company may have to borrow money or sell assets to pay such a deficiency dividend.

4. CREDIT AGREEMENT

As of
December 31, 2008, borrowings under the Credit Agreement, described below, were
$130,250,000, bearing interest at a weighted-average effective rate of 3.8% per
annum. The weighted-average effective rate is based on $85,250,000 of LIBOR
rate borrowings floating at market rates plus a margin of 1.0% and $45,000,000
of LIBOR rate borrowings effectively fixed at 5.44% by an interest rate Swap
Agreement, described below, plus a margin of 1.0%. The Company has a $175,000,000
amended and restated senior unsecured revolving credit agreement (the Credit
Agreement) with a group of domestic commercial banks led by JPMorgan Chase
Bank, N.A. (the Bank Syndicate) which expires in March 2011. The Credit
Agreement does not provide for scheduled reductions in the principal balance
prior to its maturity. The Credit Agreement permits borrowings at an interest
rate equal to the sum of a base rate plus a margin of 0.0% or 0.25% or a LIBOR
rate plus a margin of 1.0%, 1.25% or 1.5%. The applicable margin is based on
the Companys leverage ratio at the end of the prior calendar quarter, as
defined in the Credit Agreement, and is adjusted effective mid-quarter when the
Companys quarterly financial results are reported to the Bank Syndicate. Based
on the Companys leverage ratio as of December 31, 2008, the applicable margin
is 0.0% for base rate borrowings and will increase to 1.25% in the first
quarter of 2009 for LIBOR rate borrowings.

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Subject to
the terms of the Credit Agreement, the Company has the option to extend the
term of the credit agreement for one additional year to March 2012 and/or,
subject to approval by the Bank Syndicate, increase the amount of the credit
facility available pursuant to the Credit Agreement by $125,000,000 to
$300,000,000. The Company does not expect to exercise its option to increase
the amount of the Credit Agreement at this time. In addition, based on the
current lack of liquidity in the credit markets, the Company believes that it
would need to renegotiate certain terms in the Credit Agreement in order to
obtain approval from the Bank Syndicate to increase the amount of the credit
facility at this time. No assurance can be given that such approval from the
Bank Syndicate will be obtained on terms acceptable to the Company, if at all.
The annual commitment fee on the unused Credit Agreement ranges from 0.10% to
0.20% based on the amount of borrowings. The Credit Agreement contains
customary terms and conditions, including customary financial covenants such as
leverage and coverage ratios and other customary covenants, including
limitations on the Companys ability to incur debt, pay dividends and
maintenance of tangible net worth, and events of default, including change of
control and failure to maintain REIT status. A material adverse effect on the
Companys business, assets, prospects or condition, financial or otherwise,
would also result in an event of default. Any event of default, if not cured or
waived, could result in the acceleration of all of the Companys indebtedness
under the Credit Agreement.

The Company
entered into a $45,000,000 LIBOR based interest rate swap agreement with
JPMorgan Chase Bank, N.A. as the counterparty, effective through June 30, 2011
(the Swap Agreement). The Swap Agreement is intended to effectively fix, at
5.44%, the LIBOR component of the interest rate determined under the Credit
Agreement. As a result of the Swap Agreement, as of December 31, 2008,
$45,000,000 of the Companys LIBOR based borrowings under the Credit Agreement
bear interest at an effective rate of 6.44%.

The Company
entered into the Swap Agreement with JPMorgan Chase Bank, N.A., designated and
qualifying as a cash flow hedge, to reduce its exposure to the variability in
future cash flows attributable to changes in the LIBOR rate. The Companys
primary objective when undertaking the hedging transaction and derivative
position was to reduce its variable interest rate risk by effectively fixing a
portion of the interest rate for existing debt and anticipated refinancing
transactions. The Company determined, as of the Swap Agreements inception and
as of December 31, 2008 and 2007, that the derivative used in the hedging
transaction is highly effective in offsetting changes in cash flows associated
with the hedged item and that no gain or loss was required to be recognized in
earnings during 2008 or 2007 representing the hedges ineffectiveness. At
December 31, 2008 and, 2007, the Companys consolidated balance sheets include,
in accounts payable and accrued expenses, an obligation for the fair value of
the Swap Agreement of $4,296,000 and $2,299,000, respectively. For the years
ended December 31, 2008, 2007 and 2006, the Company has recorded a loss in the
fair value of the Swap Agreement related to the effective portion of the
interest rate contract totaling $1,997,000, $1,478,000 and $821,000,
respectively, in accumulated other comprehensive loss in the Companys
consolidated balance sheet. The accumulated comprehensive loss will be
recognized as an increase in interest expense as quarterly payments are made to
the counter-party over the remaining term of the Swap Agreement (of which approximately $1,862,000 is expected to
be reclassified within the next twelve months) since it is
expected that the Credit Agreement will be refinanced with variable interest
rate debt at its maturity.

The fair
value of the Swap Agreement is $4,296,000 as of December 31, 2008 determined
using (i) a discounted cash flow analysis on the expected cash flows of the
Swap Agreement, which is based on market data obtained from sources independent
of the Company consisting of interest rates and yield curves that are
observable at commonly quoted intervals and are defined by GAAP as Level 2
inputs in the Fair Value Hierarchy, and (ii) credit valuation adjustments,
which are based on unobservable Level 3 inputs. The fair value of the
$133,577,000 projected borrowings outstanding under the Credit Agreement is
$122,751,000 as of December 31, 2008 determined using a discounted cash flow
technique that incorporates a market interest yield curve, Level 2 inputs,
with adjustments for duration, optionality, risk profile and projected average
borrowings outstanding, which are based on unobservable Level 3 inputs. As of
December 31, 2008, accordingly, the Company classified its valuation of the
Swap Agreement in its entirety within Level 2 of the Fair Value Hierarchy since
the credit valuation adjustments are not significant to the overall valuation
of the Swap Agreement and its valuation of the borrowings outstanding under the
Credit Agreement in its entirety within Level 3 of the Fair Value Hierarchy.

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5. ENVIRONMENTAL EXPENSES

The Company
is subject to numerous existing federal, state and local laws and regulations,
including matters relating to the protection of the environment such as the
remediation of known contamination and the retirement and decommissioning or
removal of long-lived assets including buildings containing hazardous
materials, USTs and other equipment. Environmental expenses are principally
attributable to remediation costs which include installing, operating,
maintaining and decommissioning remediation systems, monitoring contamination,
and governmental agency reporting incurred in connection with contaminated
properties. The Company seeks reimbursement from state UST remediation funds
related to these environmental expenses where available.

The Company
enters into leases and various other agreements which allocate responsibility
for known and unknown environmental liabilities by establishing the percentage
and method of allocating responsibility between the parties. In accordance with
the leases with certain tenants, the Company has agreed to bring the leased
properties with known environmental contamination to within applicable
standards and to regulatory or contractual closure (Closure) in an efficient
and economical manner. Generally, upon achieving Closure at each individual
property, the Companys environmental liability under the lease for that
property will be satisfied and future remediation obligations will be the
responsibility of the Companys tenant. Generally the liability for the
retirement and decommissioning or removal of USTs and other equipment is the
responsibility of the Companys tenants. The Company is contingently liable for
these obligations in the event that the tenants do not satisfy their
responsibilities. A liability has not been accrued for obligations that are the
responsibility of the Companys tenants based on the tenants history of paying
such obligations and/or the Companys assessment of their financial ability to
pay their share of such costs. However, there can be no assurance that the
Companys assessments are correct or that the Companys tenants who have paid
their obligations in the past will continue to do so.

Of the
eight hundred sixty-four properties leased to Marketing as of December 31,
2008, the Company has agreed to pay all costs relating to, and to indemnify
Marketing for, certain environmental liabilities and obligations at one hundred
eighty-seven retail properties that have not achieved Closure and are scheduled
in the Master Lease. The Company will continue to seek reimbursement from state
UST remediation funds related to these environmental expenditures where
available.

It is
possible that the Companys assumptions regarding the ultimate allocation
method and share of responsibility that it used to allocate environmental
liabilities may change, which may result in material adjustments to the amounts
recorded for environmental litigation accruals, environmental remediation
liabilities and related assets. The Company will be required to accrue for
environmental liabilities that the Company believes are allocable to others
under various other agreements if the Company determines that it is probable
that the counter-party will not meet its environmental obligations. The
ultimate resolution of these matters could cause a material adverse effect on
the Companys business, financial condition, results of operations, liquidity,
ability to pay dividends and/or stock price. (See footnote 3 for contingencies
related to Marketing and the Marketing Leases for additional information.)

The
estimated future costs for known environmental remediation requirements are
accrued when it is probable that a liability has been incurred and a reasonable
estimate of fair value can be made. The environmental remediation liability is
estimated based on the level and impact of contamination at each property. The
accrued liability is the aggregate of the best estimate of the fair value of
cost for each component of the liability. Recoveries of environmental costs
from state UST remediation funds, with respect to both past and future
environmental spending, are accrued at fair value as an offset to environmental
expense, net of allowance for collection risk, based on estimated recovery
rates developed from prior experience with the funds when such recoveries are
considered probable.

Environmental
exposures are difficult to assess and estimate for numerous reasons, including
the extent of contamination, alternative treatment methods that may be applied,
location of the property which subjects it to differing local laws and
regulations and their interpretations, as well as the time it takes to
remediate contamination. In developing the Companys liability for probable and
reasonably estimable environmental remediation costs, on a property by property
basis, the Company considers among other things, enacted laws and regulations,
assessments of contamination and surrounding geology, quality of information
available, currently available technologies for treatment, alternative methods
of remediation and prior experience. These accrual estimates are subject to
significant change, and are adjusted as the remediation treatment progresses,
as circumstances change and as these

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contingencies become more clearly defined and reasonably estimable. As
of December 31, 2008, the Company had regulatory approval for remediation
action plans in place for two hundred forty-nine (95%) of the two hundred
sixty-two properties for which it continues to retain environmental
responsibility and the remaining thirteen properties (5%) remain in the
assessment phase. In addition, the Company has nominal post-closure compliance
obligations at twenty-four properties where it has received no further action
letters.

Environmental
remediation liabilities and related assets are measured at fair value based on
their expected future cash flows which have been adjusted for inflation and
discounted to present value. The net change in estimated remediation cost and
accretion expense included in environmental expenses in the Companys
consolidated statements of operations aggregated $4,656,000, $5,136,000 and
$3,202,000 for 2008, 2007 and 2006, respectively, which amounts were net of
changes in estimated recoveries from state UST remediation funds. In addition
to net change in estimated remediation costs, environmental expenses also
include project management fees, legal fees and provisions for environmental
litigation loss reserves.

As of
December 31, 2008, 2007, 2006 and 2005, the Company had accrued $17,660,000,
$18,523,000, $17,201,000 and $17,350,000 respectively, as managements best
estimate of the fair value of reasonably estimable environmental remediation
costs. As of December 31, 2008, 2007, 2006 and 2005, the Company had also
recorded $4,223,000, $4,652,000, $3,845,000 and $4,264,000, respectively, as
managements best estimate for recoveries from state UST remediation funds, net
of allowance, related to environmental obligations and liabilities. The net
environmental liabilities of $13,871,000, $13,356,000 and $13,086,000 as of
December 31, 2007, 2006 and 2005, respectively, were subsequently accreted for
the change in present value due to the passage of time and, accordingly,
$956,000, $974,000 and $923,000 of net accretion expense was recorded for the
years ended December 31, 2008, 2007 and 2006, respectively, substantially all
of which is included in environmental expenses.

In view of
the uncertainties associated with environmental expenditures, contingencies
related to Marketing and the Marketing Leases and contingencies related to
other parties, however, the Company believes it is possible that the fair value
of future actual net expenditures could be substantially higher than amounts
currently recorded by the Company. (See footnote 3 for contingencies related to
Marketing and the Marketing Leases for additional information.) Adjustments to
accrued liabilities for environmental remediation costs will be reflected in
the Companys financial statements as they become probable and a reasonable
estimate of fair value can be made. Future environmental expenses could cause a
material adverse effect on our business, financial condition, results of
operations, liquidity, ability to pay dividends and/or stock price.

6. INCOME TAXES

Net cash
paid for income taxes for the years ended December 31, 2008, 2007 and 2006 of
$708,000, $488,000 and $576,000, respectively, includes amounts related to
state and local income taxes for jurisdictions that do not follow the federal
tax rules, which are provided for in rental property expenses in the Companys
consolidated statements of operations.

Earnings
and profits (as defined in the Internal Revenue Code) is used to determine the
tax attributes of dividends paid to stockholders and will differ from income
reported for financial statement purposes due to the effect of items which are
reported for income tax purposes in years different from that in which they are
recorded for financial statement purposes. Earnings and profits were
$40,906,000, $41,147,000 and $39,486,000 for the years ended December 31, 2008,
2007 and 2006, respectively. The federal tax attributes of the common dividends
for the years ended December 31, 2008, 2007 and 2006 were: ordinary income of
87.4%, 90.3% and 88.0%; capital gain distributions of 1.2%, 0.0% and 0.02% and
non-taxable distributions of 11.4%, 9.7% and 11.8%, respectively.

In order to
qualify as a REIT, among other items, the Company must pay out substantially
all of its earnings and profits in cash distributions to shareholders each
year. Should the Internal Revenue Service successfully assert that the
Companys earnings and profits were greater than the amount distributed, the
Company may fail to qualify as a REIT; however, the Company may avoid losing
its REIT status by paying a deficiency dividend to eliminate any remaining
earnings and profits. The Company may have to borrow money or sell assets to
pay such a deficiency dividend. The Company accrues for this and certain other
tax matters when appropriate based on information

59

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currently available. The accrual for uncertain tax positions is
adjusted as circumstances change and as the uncertainties become more clearly
defined, such as when audits are settled or exposures expire. Accordingly, an
income tax benefit of $700,000 was recorded in the third quarter of 2006, due
to the elimination of the amount accrued for uncertain tax positions since the
Company believes that the uncertainties regarding these exposures have been
resolved or that it is no longer likely that the exposure will result in a
liability upon review. However, the ultimate resolution of these matters may
have a significant impact on the results of operations for any single fiscal
year or interim period.

7. SHAREHOLDERS EQUITY

A summary
of the changes in shareholders equity for the years ended December 31, 2008,
2007 and 2006 is as follows (in thousands, except per share amounts):

|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   |        |   |   |         |  
|----------------------------------------- |  | ------------- | ------ | ---------------- | - | --- | ------------------------------------ | - | ------- | ----------------------------------- | ----- | ------- | ----- | - | ------ | - | - | ------- | -
|                                          |  | COMMON
 STOCK |        | PAID-IN
 CAPITAL |   |     | DIVIDENDSPAIDIN
 EXCESS
 OF EARNINGS |   |         | ACCUMULATEDOTHERCOMPREHENSIVE
 LOSS |       |         |       |  
|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |      
|                                          |  | SHARES        |        | AMOUNT           |   |     |                                      |   |         |                                     | TOTAL |        
|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |      
|BALANCE,DECEMBER 31, 2005                 |  |               | 24,717 |                  | $ | 247 |                                      | $ | 257,766 |                                     | $     | (30,130 | )     | $ |       |   | $ | 227,883 |  
|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   |        |   |   |         |  
|Net earnings                              |  |               |        |                  |   |     |                                      |   |         |                                     |       | 42,725  |       |   |        |   |   | 42,725  |  
|Dividends  $1.82 per common share        |  |               |        |                  |   |     |                                      |   |         |                                     |       | (45,094 | )     |   |        |   |   | (45,094 | )
|Stock-based compensation                  |  |               |        |                  |   |     |                                      |   | 186     |                                     |       |         |       |   |        |   |   | 186     |  
|Net unrealized loss on interest rate swap |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   | (821   | ) |   | (821    | )
|Stock options exercised                   |  |               | 48     |                  |   | 1   |                                      |   | 695     |                                     |       |         |       |   |        |   |   | 696     |  
|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   |        |   |   |         |  
|BALANCE,DECEMBER 31, 2006                 |  |               | 24,765 |                  |   | 248 |                                      |   | 258,647 |                                     |       | (32,499 | )     |   | (821   | ) |   | 225,575 |  
|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   |        |   |   |         |  
|Net earnings                              |  |               |        |                  |   |     |                                      |   |         |                                     |       | 33,894  |       |   |        |   |   | 33,894  |  
|Dividends  $1.85 per common share        |  |               |        |                  |   |     |                                      |   |         |                                     |       | (45,900 | )     |   |        |   |   | (45,900 | )
|Stock-based compensation                  |  |               |        |                  |   |     |                                      |   | 87      |                                     |       |         |       |   |        |   |   | 87      |  
|Net unrealized loss on interest rate swap |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   | (1,478 | ) |   | (1,478  | )
|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   |        |   |   |         |  
|BALANCE,DECEMBER 31, 2007                 |  |               | 24,765 |                  |   | 248 |                                      |   | 258,734 |                                     |       | (44,505 | )     |   | (2,299 | ) |   | 212,178 |  
|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   |        |   |   |         |  
|Net earnings                              |  |               |        |                  |   |     |                                      |   |         |                                     |       | 41,810  |       |   |        |   |   | 41,810  |  
|Dividends  $1.87 per common share        |  |               |        |                  |   |     |                                      |   |         |                                     |       | (46,429 | )     |   |        |   |   | (46,429 | )
|Stock-based compensation                  |  |               | 1      |                  |   |     |                                      |   | 326     |                                     |       |         |       |   |        |   |   | 326     |  
|Stock options exercised                   |  |               |        |                  |   |     |                                      |   | 9       |                                     |       |         |       |   |        |   |   | 9       |  
|Net unrealized loss on interest rate swap |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   | (1,997 | ) |   | (1,997  | )
|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   |        |   |   |         |  
|BALANCE,DECEMBER 31, 2008                 |  |               | 24,766 |                  | $ | 248 |                                      | $ | 259,069 |                                     | $     | (49,124 | ) (a) | $ | (4,296 | ) | $ | 205,897 |  
|                                          |  |               |        |                  |   |     |                                      |   |         |                                     |       |         |       |   |        |   |   |         |  

|    |                                                                                                                                    
|--- | -----------------------------------------------------------------------------------------------------------------------------------
|(a) | Net of $103,803 transferred from retained earnings to common stock
 and paid-in capital as a result of accumulated stock dividends.

The Company
is authorized to issue 20,000,000 shares of preferred stock, par value $.01 per
share, for issuance in series, of which none were issued as of December 31,
2008, 2007, 2006 and 2005.

8. SEVERANCE AGREEMENT AND EMPLOYEE BENEFIT
PLANS

General and
administrative expenses include a provision of $447,000 recorded in the quarter
ended December 31, 2007 primarily due to the payment of severance and the
accelerated vesting of 14,250 restricted stock units which were unvested and
scheduled to vest five years from the date of each grant in conjunction with
the resignation of Mr. Andy Smith, the former President and Chief Legal Officer
of the Company.

The Company
has a retirement and profit sharing plan with deferred 401(k) savings plan
provisions (the Retirement Plan) for employees meeting certain service
requirements and a supplemental plan for executives (the Supplemental Plan).
Under the terms of these plans, the annual discretionary contributions to the
plans are determined by the Compensation Committee of the Board of Directors.
Also, under the Retirement Plan, employees

60

---



may make voluntary contributions and the Company has elected to match
an amount equal to fifty percent of such contributions but in no event more
than three percent of the employees eligible compensation. Under the
Supplemental Plan, a participating executive may receive an amount equal to ten
percent of eligible compensation, reduced by the amount of any contributions
allocated to such executive under the Retirement Plan. Contributions, net of
forfeitures, under the retirement plans approximated $151,000, $100,000 and
$139,000 for the years ended December 31, 2008, 2007 and 2006, respectively.
These amounts are included in the accompanying consolidated statements of
operations.

The Getty
Realty Corp. 2004 Omnibus Incentive Compensation Plan (the 2004 Plan)
provides for the grant of restricted stock, restricted stock units, performance
awards, dividend equivalents, stock payments and stock awards to all employees
and members of the Board of Directors. The 2004 Plan authorizes the Company to
grant awards with respect to an aggregate of 1,000,000 shares of common stock
through 2014. The aggregate maximum number of shares of common stock that may
be subject to awards granted under the 2004 Plan during any calendar year is
80,000.

The Company
awarded to employees and directors 23,800, 17,550 and 12,550 restricted stock
units (RSUs) and dividend equivalents in 2008, 2007 and 2006, respectively.
The RSUs are settled subsequent to the termination of employment with the
Company. On the settlement date each RSU will have a value equal to one share
of common stock and may be settled, at the sole discretion of the Compensation
Committee, in cash or by the issuance of one share of common stock. In 2008,
the Company settled 1,000 RSUs by issuing 400 shares of common stock with an intrinsic
value of $7,000 net of employee tax withholdings and cancelling 600 RSUs that
were not vested. In 2007, the Compensation Committee elected to settle 14,250
RSUs in cash for $405,000. The RSUs do not provide voting or other shareholder
rights unless and until the RSU is settled for a share of common stock. The
62,000 RSUs outstanding as of December 31, 2008 vest starting one year from the
date of grant, on a cumulative basis at the annual rate of twenty percent of
the total number of RSUs covered by the award. The dividend equivalents
represent the value of the dividends paid per common share multiplied by the
number of RSUs covered by the award.

The fair
values of the RSUs were determined based on the closing market price of the
Companys stock on the date of grant. The average fair values of the RSUs
granted in 2008, 2007, and 2006 were estimated at $26.86, $28.78, and $28.80
per unit on the date of grant with an aggregate fair value estimated at
$639,000, $505,000 and $361,000, respectively. The fair value of the grants is
recognized as compensation expense ratably over the five year vesting period of
the RSUs. As of December 31, 2008, there was $971,000 of total unrecognized
compensation cost related to RSUs granted under the 2004 Plan.

The fair
value of the 7,840, 19,330 and 3,320 RSUs which vested during the years ended
December 31, 2008, 2007 and 2006 was $213,000, $523,000 and $88,000,
respectively. The aggregate intrinsic value of the 62,000 outstanding RSUs and
the 17,400 vested RSUs as of December 31, 2008 was $1,306,000 and $366,000,
respectively. For the years ended December 31, 2008, 2007 and 2006, dividend
equivalents aggregating approximately $88,000, $85,000 and $65,000,
respectively, were charged against retained earnings when common stock
dividends were declared.

The Company
has a stock option plan (the Stock Option Plan). The Companys authorization
to grant options to purchase shares of the Companys common stock under the
Stock Option Plan expired in January 2008. No options were granted in 2008.
Stock options vest starting one year from the date of grant, on a cumulative
basis at the annual rate of twenty-five percent of the total number of options
covered by the award. As of December 31, 2008, there was $10,000 of
unrecognized compensation cost related to non-vested options granted in May
2007 under the Stock Option Plan with an estimated fair value of $18,000, or
$3.51 per option. The total fair value of the options vested during the years
ended December 31, 2008 and 2006 was $4,000 and $8,000, respectively. As of
December 31, 2008, there were 1,750, 10,500 and 5,000 options outstanding which
were exercisable at prices of $16.15, $18.30 and $27.68 with a remaining
contractual life of three, four and nine years, respectively.

61

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The following is a schedule of stock option prices and
activity relating to the Stock Option Plan:

|                                 |  |                         |                    |   |      |                               |  |      |                                          |  |   |                                       |  |  |                 |  |   |                               |  |  |                 |   |   |                               | 
|-------------------------------- |  | ----------------------- | ------------------ | - | ---- | ----------------------------- |  | ---- | ---------------------------------------- |  | - | ------------------------------------- |  |  | --------------- |  | - | ----------------------------- |  |  | --------------- | - | - | ----------------------------- | 
|                                 |  | YEAR ENDED DECEMBER 31, |                   
|                                 |  |                         |                   
|                                 |  | 2008                    |                    |   | 2007 |                               |  | 2006 |                                         
|                                 |  |                         |                    |   |      |                               |  |      |                                          |  |   |                                       |  |  |                 |  |   |                               | 
|                                 |  |                         | NUMBER
  OF SHARES |   |      | WEIGHTED-AVERAGEEXERCISEPRICE |  |      | WEIGHTED-AVERAGEREMAININGCONTRACTUALTERM |  |   | AGGREGATEINTRINSICVALUE(IN THOUSANDS) |  |  | NUMBEROF SHARES |  |   | WEIGHTED-AVERAGEEXERCISEPRICE |  |  | NUMBEROF SHARES |   |   | WEIGHTED-AVERAGEEXERCISEPRICE | 
|                                 |  |                         |                    |   |      |                               |  |      |                                          |  |   |                                       |  |  |                 |  |   |                               |  |  |                 |   |   |                               | 
|Outstanding at beginning of year |  |                         | 17,750             |   | $    | 20.73                         |  |      |                                          |  |   |                                       |  |  | 12,750          |  | $ | 18.00                         |  |  | 84,378          |   | $ | 19.48                         | 
|Issued                           |  |                         |                   |   |      |                              |  |      |                                          |  |   |                                       |  |  | 5,000           |  |   | 27.68                         |  |  |                |   |   |                              | 
|Exercised (a)                    |  |                         | (500               | ) |      | 18.30                         |  |      |                                          |  |   |                                       |  |  |                |  |   |                              |  |  | (71,628         | ) |   | 19.74                         | 
|Cancelled                        |  |                         |                   |   |      |                              |  |      |                                          |  |   |                                       |  |  |                |  |   |                              |  |  |                |   |   |                              | 
|                                 |  |                         |                    |   |      |                               |  |      |                                          |  |   |                                       |  |  |                 |  |   |                               |  |  |                 |   |   |                               | 
|Outstanding at end of year       |  |                         | 17,250             |   | $    | 20.80                         |  |      | 5.3                                      |  | $ | 4                                     |  |  | 17,750          |  | $ | 20.73                         |  |  | 12,750          |   | $ | 18.00                         | 
|                                 |  |                         |                    |   |      |                               |  |      |                                          |  |   |                                       |  |  |                 |  |   |                               |  |  |                 |   |   |                               | 
|Exercisable at end of year (b)   |  |                         | 13,500             |   | $    | 18.89                         |  |      | 4.8                                      |  | $ | 29                                    |  |  | 12,750          |  | $ | 18.00                         |  |  | 12,750          |   | $ | 18.00                         | 
|                                 |  |                         |                    |   |      |                               |  |      |                                          |  |   |                                       |  |  |                 |  |   |                               |  |  |                 |   |   |                               | 

|    |                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | The total intrinsic value of the options exercised
 during the years ended December 31, 2008 and 2006 was $5,000 and $704,000,
 respectively.                        
|    |                                                                                                                                                                      
|(b) | The options vested during the years ended December
 31, 2008 and 2006 was 1,250 and 14,875, respectively. No options vested
 during the year ended December 31, 2007.

9.
QUARTERLY FINANCIAL DATA

The
following is a summary of the quarterly results of operations for the years
ended December 31, 2008 and 2007 (unaudited as to quarterly information) (in
thousands, except per share amounts):

|                                                   |  |                     |                     |                           |   |                |  |               |        |  |   |        |   |   |        | 
|-------------------------------------------------- |  | ------------------- | ------------------- | ------------------------- | - | -------------- |  | ------------- | ------ |  | - | ------ | - | - | ------ | 
|                                                   |  | THREE
 MONTHS ENDED |                     |                           |  
|                                                   |  |                     |                     | YEAR
 ENDED
 DECEMBER 31, |  
|YEAR ENDED DECEMBER 31, 2008                       |  | MARCH
 31,          |                     | JUNE
 30,                 |   | SEPTEMBER
 30, |  | DECEMBER
 31, |        | 
|                                                   |  |                     |                     |                           |   |                |  |               |        |  |  
|Revenues from
 rental properties                   |  | $                   | 20,242              |                           | $ | 20,187         |  | $             | 20,328 |  | $ | 20,406 |   | $ | 81,163 | 
|Earnings from
 continuing operations               |  |                     | 10,832              |                           |   | 9,361          |  |               | 10,011 |  |   | 8,958  |   |   | 39,162 | 
|Net earnings                                       |  |                     | 11,371              |                           |   | 10,635         |  |               | 10,489 |  |   | 9,315  |   |   | 41,810 | 
|Diluted earnings
 per common share:                |  |                     |                     |                           |   |                |  |               |        |  |   |        |   |   |        | 
|Earnings from
 continuing operations               |  |                     | .44                 |                           |   | .38            |  |               | .40    |  |   | .36    |   |   | 1.58   | 
|Net earnings                                       |  |                     | .46                 |                           |   | .43            |  |               | .42    |  |   | .38    |   |   | 1.69   | 
|                                                  
|                                                   |  |                     | THREE
 MONTHS ENDED |                           |   |                | 
|                                                   |  |                     |                     | YEAR
 ENDED
 DECEMBER 31, |  
|YEAR ENDED DECEMBER 31, 2007 (a)                   |  | MARCH
 31,          |                     | JUNE
 30,                 |   | SEPTEMBER
 30, |  | DECEMBER
 31, |        | 
|                                                   |  |                     |                     |                           |   |                |  |               |        |  |  
|Revenues from
 rental properties                   |  | $                   | 17,713              |                           | $ | 20,248         |  | $             | 20,000 |  | $ | 20,108 |   | $ | 78,069 | 
|Earnings (loss)
 from continuing operations (b)(c) |  |                     | 10,194              |                           |   | 8,507          |  |               | 9,907  |  |   | (498   | ) |   | 28,110 | 
|Net earnings
 (b)(c)                               |  |                     | 10,437              |                           |   | 10,024         |  |               | 12,846 |  |   | 587    |   |   | 33,894 | 
|Diluted earnings
 (loss) per common share:         |  |                     |                     |                           |   |                |  |               |        |  |   |        |   |   |        | 
|Earnings (loss)
 from continuingoperations (b)(c)  |  |                     | .41                 |                           |   | .34            |  |               | .40    |  |   | (.02   | ) |   | 1.13   | 
|Net earnings
 (b)(c)                               |  |                     | .42                 |                           |   | .40            |  |               | .52    |  |   | .02    |   |   | 1.37   | 

|    |                                                                                                                                                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | Includes (from the date of the acquisition) the
 effect of the $84.6 million acquisition of convenience stores and gas station
 properties from FF-TSY Holding Company II LLC (successor to Trustreet
 Properties, Inc.) which was substantially completed by the end of the first quarter
 of 2007 (See footnote 10 for additional information).
|    |                                                                                                                                                                                                                                                                                                                                                  
|(b) | The quarter ended December 31, 2007 includes the
 effect of a $10.5 million non-cash reserve for the full amount of the
 deferred rent receivable recorded as of December 31, 2007 related to
 approximately 40% of the properties under leases with Marketing, (See
 footnote 3 for additional information).                                    
|    |                                                                                                                                                                                                                                                                                                                                                  
|(c) | The quarter ended December 31, 2007 includes a net
 expense of $447,000 related to Mr. Andy Smiths resignation (See footnote 8
 for additional information).                                                                                                                                                                                    

62

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10.
PROPERTY ACQUISITIONS

On
February 28, 2006, the Company completed the acquisition of eighteen retail
motor fuel and convenience store properties located in Western New York for
approximately $13,389,000. Simultaneous with the closing on the acquisition,
the Company entered into a triple-net lease with a single tenant for all of the
properties. The lease provides for annual rentals at a competitive rate and
provides for escalations thereafter. The lease has an initial term of fifteen
years and provides the tenant options for three renewal terms of five years
each. The lease also provides that the tenant is responsible for all existing
and future environmental conditions at the properties.

Effective
March 31, 2007, the Company acquired fifty-nine convenience store and retail
motor fuel properties in ten states for approximately $79,335,000 from various
subsidiaries of FF-TSY Holding Company II, LLC (the successor to Trustreet
Properties, Inc.) (Trustreet), a subsidiary of General Electric Capital
Corporation, for cash with funds drawn under its Credit Agreement. Effective
April 23, 2007, the Company acquired five additional properties from Trustreet
for approximately $5,200,000. The aggregate cost of the acquisitions, including
$1,131,000 of transaction costs, is approximately $84,535,000. Substantially
all of the properties are triple-net-leased to tenants who previously leased
the properties from the seller. The leases generally provide that the tenants
are responsible for substantially all existing and future environmental
conditions at the properties.

The
purchase price has been allocated between assets, liabilities and intangible
assets based on the estimates of fair value. The Company estimated the fair
value of acquired tangible assets (consisting of land, buildings and
improvements) as if vacant and identified intangible assets and liabilities
(consisting of leasehold interests, above-market and below-market leases and
in-place leases). Based on these estimates, the Company allocated $89,908,000,
$5,351,000 and $10,724,000 of the purchase price to acquired tangible assets;
identified intangible assets; and identified intangible liabilities,
respectively.

The
following unaudited pro forma condensed consolidated financial information has
been prepared utilizing the historical financial statements of Getty Realty
Corp. and the historical financial information of the properties acquired in
2007 which was derived from the consolidated books and records of Trustreet.
The unaudited pro forma condensed consolidated financial information assumes
that the acquisitions had occurred as of the beginning of each of the periods
presented, after giving effect to certain adjustments including (a) rental income
adjustments resulting from (i) the straight-lining of scheduled rent increases
and (ii) the net amortization of the intangible assets relating to above-market
leases and intangible liabilities relating to below-market leases over the
remaining lease terms which average eleven years and (b) depreciation and
amortization adjustments resulting from (i) the depreciation of real estate
assets over their useful lives which average seventeen years and (ii) the
amortization of intangible assets relating to leases in place over the
remaining lease terms. The following unaudited pro forma condensed consolidated
financial information also gives effect to the additional interest expense
resulting from the assumed increase in borrowing outstanding drawn under the Credit
Agreement to fund the acquisition.

The
unaudited pro forma condensed financial information the years ended December
31, 2007 and 2006 is not indicative of the results of operations that would
have been achieved had the acquisition from Trustreet reflected herein been
consummated on the dates indicated or that will be achieved in the future and
is as follows (in thousands, except per share amounts):

|                                |  |      |        |      |   |        | 
|------------------------------- |  | ---- | ------ | ---- | - | ------ | 
|                                |  | 2007 |        | 2006 |  
|                                |  |      |        |      |  
|Revenues from rental properties |  | $    | 81,344 |      | $ | 81,724 | 
|                                |  |      |        |      |   |        | 
|Net earnings                    |  | $    | 34,348 |      | $ | 43,900 | 
|                                |  |      |        |      |   |        | 
|Net earnings per share          |  |      |        |      |   |        | 
|Basic                           |  | $    | 1.39   |      | $ | 1.77   | 
|Diluted                         |  | $    | 1.39   |      | $ | 1.77   | 

In
2007, the Company also exercised its fixed price purchase option for seven
leased properties, purchased two properties and redeveloped one property by
purchasing land adjacent to it and building a new convenience store on the
existing site. In 2008, the Company exercised its fixed price purchase option
for three leased properties and purchased six properties.

63

---



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Getty
Realty Corp.:

In
our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations, comprehensive income and cash flows
present fairly, in all material respects, the financial position of Getty
Realty Corp. and its subsidiaries at December 31, 2008 and 2007, and the
results of their operations and their cash flows for each of the three years in
the period ended December 31, 2008, in conformity with accounting principles
generally accepted in the United States of America. Also in our opinion, the
Company maintained, in all material respects, effective internal control over
financial reporting as of December 31, 2008 based on criteria established in
Internal Control  Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). The Companys management is
responsible for these financial statements, for maintaining effective internal
control over financial reporting and for its assessment of the effectiveness of
internal control over financial reporting, included in the Managements Report
on Internal Control Over Financial Reporting appearing under Item 9A. Our
responsibility is to express opinions on these financial statements and on the
Companys internal control over financial reporting based on our integrated
audits. We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require
that we plan and perform the audits to obtain reasonable assurance about
whether the financial statements are free of material misstatement and whether
effective internal control over financial reporting was maintained in all
material respects. Our audits of the financial statements included examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial statement
presentation. Our audit of internal control over financial reporting included
obtaining an understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, and testing and evaluating
the design and operating effectiveness of internal control based on the
assessed risk. Our audits also included performing such other procedures as we
considered necessary in the circumstances. We believe that our audits provide a
reasonable basis for our opinions.

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

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

|                              
|------------------------------
|/s/ PricewaterhouseCoopers LLP
|New York, New York            
|March 2, 2009                 

64

---



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

None.

Item 9A. Controls and Procedures

Disclosure
Controls and Procedures

The
Company maintains disclosure controls and procedures that are designed to
ensure that information required to be disclosed in the Companys reports filed
or furnished pursuant to the Exchange Act, is recorded, processed, summarized
and reported within the time periods specified in the Commissions rules and
forms, and that such information is accumulated and communicated to the
Companys management, including its Chief Executive Officer and Chief Financial
Officer, as appropriate, to allow timely decisions regarding required
disclosure. In designing and evaluating the disclosure controls and procedures,
management recognized that any controls and procedures, no matter how well
designed and operated, can provide only reasonable assurance of achieving the
desired control objectives, and management necessarily was required to apply
its judgment in evaluating the cost-benefit relationship of possible controls
and procedures.

As
required by the Exchange Act Rule 13a-15(b), the Company has carried out an
evaluation, under the supervision and with the participation of the Companys
management, including the Companys Chief Executive Officer and the Companys
Chief Financial Officer, of the effectiveness of the design and operation of
the Companys disclosure controls and procedures as of the end of the period
covered by this Annual Report on Form 10-K. Based on the foregoing, the
Companys Chief Executive Officer and Chief Financial Officer concluded that
the Companys disclosure controls and procedures were effective at the
reasonable assurance level as of December 31, 2008.

Managements
Report on Internal Control Over Financial Reporting

Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Exchange Act Rule
13a-15(f). Under the supervision and with the participation of our management,
including our Chief Executive Officer and Chief Financial Officer, we have
conducted an evaluation of the effectiveness of our internal control over
financial reporting based on the framework in Internal Control  Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission. Based on our assessment under the framework in Internal Control 
Integrated Framework, our management concluded that our internal control over
financial reporting was effective as of December 31, 2008.

The
effectiveness of our internal control over financial reporting as of December
31, 2008, has been audited by PricewaterhouseCoopers LLP, an independent
registered public accounting firm, as stated in their report which appears in
Item 8. Financial Statements and Supplementary Data.

There
have been no changes in the Companys internal control over financial reporting
during the latest fiscal quarter that have materially affected, or are
reasonably likely to materially affect, the Companys internal control over financial
reporting.

NYSE
Certifications

On June 16, 2008, in accordance with Section 303A.12
of the Listed Company Manual of the New York Stock Exchange, our Chief
Executive Officer certified to the New York Stock Exchange that he was not
aware of any violation by our Company of New York Stock Exchange corporate
governance listing standards as of that date. Further the Company files
certifications by its Chief Executive Officer and Chief Financial Officer with
the SEC, in accordance with the Sarbanes-Oxley Act of 2002. These
certifications are filed as exhibits to this our Annual Report on Form 10-K.

Item 9B. Other Information

None.

65

---



PART III

Item 10. Directors, Executive Officers and Corporate Governance

Information with respect to compliance with section
16(a) of the Exchange Act is incorporated herein by reference to information
under the heading Section 16(a) Beneficial Ownership Reporting Compliance in
the Proxy Statement. Information with respect to directors, the audit committee
and the audit committee financial expert, and procedures by which shareholders
may recommend to nominees to the board of directors in response to this item is
incorporated herein by reference to information under the headings Election of
Directors and Directors Meetings, Committees and Executive Officers in the
Proxy Statement. The following table lists our executive officers, their
respective ages, and the offices and positions held.

|                    |     |                                                        |               
|------------------- | --- | ------------------------------------------------------ | --------------
|NAME                | AGE | POSITION                                               | OFFICER
 SINCE
|                    |     |                                                        |               
|Leo Liebowitz       | 81  | Chairman and Chief Executive Officer                   | 1971          
|Kevin C. Shea       | 49  | Executive Vice President                               | 2001          
|Thomas J. Stirnweis | 50  | Vice President, Treasurer and Chief Financial
 Officer | 2001          
|Joshua Dicker       | 48  | General Counsel and Corporate Secretary                | 2008          

Mr.
Liebowitz cofounded the Company in 1955 and has served as Chief Executive
Officer since 1985. He was the President of the Company from May 1971 to May
2004. Mr. Liebowitz served as Chairman, Chief Executive Officer and a director
of Marketing from October 1996 until December 2000. He is also a director of
the Regional Banking Advisory Board of J.P. Morgan Chase & Co.

Mr.
Shea has been with the Company since 1984 and has served as Executive Vice
President since May 2004. He was Vice President since January 2001 and Director
of National Real Estate Development prior thereto.

Mr.
Stirnweis has been with the Company or Getty Petroleum Marketing Inc. since
1988 and has served as Vice President, Treasurer and Chief Financial Officer of
the Company since May 2003. He joined the Company in January 2001 as Corporate
Controller and Treasurer. Prior to joining the Company, Mr. Stirnweis was
Manager of Financial Reporting and Analysis of Marketing.

Mr.
Dicker joined the Company in February 2008 as General Counsel and Corporate
Secretary. Prior to joining Getty, he was a partner at the national law firm
Arent Fox, LLP, resident in its New York City office, specializing in corporate
and transactional matters.

There
are no family relationships between any of the Companys directors or executive
officers.

The
Getty Realty Corp. Business Conduct Guidelines (Code of Ethics), which
applies to all employees, including our chief executive officer and chief
financial officer, is available on our website at www.gettyrealty.com.

Item 11. Executive Compensation

Information in response to this item is incorporated
herein by reference to information under the heading Executive Compensation
in the Proxy Statement.

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

Information
in response to this item is incorporated herein by reference to information
under the heading Beneficial Ownership of Capital Stock and Executive
Compensation  Compensation Discussion and Analysis  Equity Compensation 
Equity Compensation Plan Information in the Proxy Statement.

66

---



Item 13. Certain Relationships and Related Transactions, and
Director Independence

There
were no such relationships or transactions to report for the year ended
December 31, 2008. Information with respect to director independence is
incorporated herein by reference to information under the heading Directors
Meetings, Committees and Executive Officers  Independence of Directors in the
Proxy Statement.

Item 14. Principal Accountant Fees and Services

Information in
response to this item is incorporated herein by reference to information under
the heading Ratification of Appointment of Independent Registered Public
Accounting Firm in the Proxy Statement.

67

---



PART IV

Item 15. Exhibits and
Financial Statement Schedules

| |                                                                                                             
| | ------------------------------------------------------------------------------------------------------------
| | (a)(1) Financial Statements                                                                                 
| |                                                                                                             
| | Information
 in response to this Item is included in Item 8. Financial Statements and
 Supplementary Data.
| |                                                                                                             
| | (a)(2) Financial Statement Schedules                                                                        

GETTY REALTY CORP. 
INDEX TO FINANCIAL STATEMENT SCHEDULES
Item 15(a)(2)

|                                                                                                                   |  |      
|------------------------------------------------------------------------------------------------------------------ |  | -----
|                                                                                                                   |  | PAGES
|                                                                                                                   |  |      
|Report of Independent Registered
Public
 Accounting Firm on Financial Statement Schedules                          |  | 69   
|Schedule II - Valuation and
Qualifying
 Accounts and Reserves for the years ended December 31, 2008, 2007 and 2006 |  | 69   
|Schedule III - Real Estate and
Accumulated
 Depreciation and Amortization as of December 31, 2008                  |  | 70   

| |                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------
| | (a)(3) Exhibits                                                                                                              
| |                                                                                                                              
| | Information
 in response to this Item is incorporated herein by reference to the Exhibit
 Index on page 86 of this Form 10-K.

68

---



REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
ON FINANCIAL STATEMENT SCHEDULES

To the Board
of Directors of Getty Realty Corp.:

Our
audits of the consolidated financial statements and of the effectiveness of
internal control over financial reporting referred to in our report dated March
2, 2009 appearing in Item 8 of this Annual Report on Form 10-K also included an
audit of the financial statement schedules listed in Item 15(a)(2) of this Form
10-K. In our opinion, these financial statement schedules present fairly, in
all material respects, the information set forth therein when read in
conjunction with the related consolidated financial statements.

/s/
PricewaterhouseCoopers LLP

New York, New
York
March 2, 2009

GETTY REALTY CORP. and SUBSIDIARIES
SCHEDULE II  VALUATION and QUALIFYING ACCOUNTS and RESERVES
for the years ended December 31, 2008, 2007 and 2006
(in thousands)

|                                                                    |  |                                 |        |           |   |            |  |                          |     |  |   |        | 
|------------------------------------------------------------------- |  | ------------------------------- | ------ | --------- | - | ---------- |  | ------------------------ | --- |  | - | ------ | 
|                                                                    |  | BALANCE
 AT
 BEGINNING
 OF YEAR |        | ADDITIONS |   | DEDUCTIONS |  | BALANCE
 AT END
 OF YEAR |    
|                                                                    |  |                                 |        |           |   |            |  |                          |    
|December 31,
 2008:                                                 |  |                                 |        |           |   |            |  |                          |     |  |   |        | 
|Allowance
 for deferred rent receivable                             |  | $                               | 10,494 |           | $ |           |  | $                        | 465 |  | $ | 10,029 | 
|Allowance
 for mortgages and accounts receivable                    |  | $                               | 100    |           | $ | 71         |  | $                        | 71  |  | $ | 100    | 
|Allowance
 for deposits held in escrow                              |  | $                               |       |           | $ | 377        |  | $                        |    |  | $ | 377    | 
|Allowance for recoveries from state
 underground storage tank funds |  | $                               | 650    |           | $ |           |  | $                        |    |  | $ | 650    | 
|December 31,
 2007:                                                 |  |                                 |        |           |   |            |  |                          |     |  |   |        | 
|Allowance
 for deferred rent receivable                             |  | $                               |       |           | $ | 10,494     |  | $                        |    |  | $ | 10,494 | 
|Allowance
 for mortgages and accounts receivable                    |  | $                               | 30     |           | $ | 70         |  | $                        |    |  | $ | 100    | 
|Allowance for recoveries from state
 underground storage tank funds |  | $                               | 650    |           | $ |           |  | $                        |    |  | $ | 650    | 
|December 31,
 2006:                                                 |  |                                 |        |           |   |            |  |                          |     |  |   |        | 
|Allowance
 for mortgages and accounts receivable                    |  | $                               | 29     |           | $ | 44         |  | $                        | 43  |  | $ | 30     | 
|Allowance for recoveries from state
 underground storage tank funds |  | $                               | 750    |           | $ |           |  | $                        | 100 |  | $ | 650    | 

69

---



GETTY REALTY CORP. and SUBSIDIARIESSCHEDULE III  REAL ESTATE AND ACCUMULATED DEPRECIATION AND
AMORTIZATION
As of December 31, 2008
(in thousands)

The summarized
changes in real estate assets and accumulated depreciation are as follows:

|                                            |  |      |         |      |   |         |   |   |         |  
|------------------------------------------- |  | ---- | ------- | ---- | - | ------- | - | - | ------- | -
|                                            |  | 2008 |         | 2007 |   | 2006    |  
|                                            |  |      |         |      |   |         |  
|Investment in real estate:                  |  |      |         |      |   |         |   |   |         |  
|Balance at
 beginning of year               |  | $    | 474,254 |      | $ | 383,558 |   | $ | 370,495 |  
|Acquisitions                                |  |      | 6,540   |      |   | 94,700  |   |   | 15,496  |  
|Capital expenditures                        |  |      |        |      |   | 1,310   |   |   | 42      |  
|Sales and condemnations                     |  |      | (3,939  | )    |   | (3,464  | ) |   | (1,416  | )
|Lease terminations                          |  |      | (3,288  | )    |   | (1,850  | ) |   | (1,059  | )
|                                            |  |      |         |      |   |         |   |   |         |  
|Balance at
 end of year                     |  | $    | 473,567 |      | $ | 474,254 |   | $ | 383,558 |  
|                                            |  |      |         |      |   |         |   |   |         |  
|Accumulated
 depreciation and amortization: |  |      |         |      |   |         |   |   |         |  
|Balance at
 beginning of year               |  | $    | 122,465 |      | $ | 116,089 |   | $ | 109,800 |  
|Depreciation and amortization expense       |  |      | 11,576  |      |   | 9,448   |   |   | 7,883   |  
|Sales and condemnations                     |  |      | (1,431  | )    |   | (1,222  | ) |   | (535    | )
|Lease terminations                          |  |      | (3,288  | )    |   | (1,850  | ) |   | (1,059  | )
|                                            |  |      |         |      |   |         |   |   |         |  
|Balance at
 end of year                     |  | $    | 129,322 |      | $ | 122,465 |   | $ | 116,089 |  
|                                            |  |      |         |      |   |         |   |   |         |  

We are not
aware of any material liens or encumbrances on any of our properties.

|                       |  |                                                                         |         |                                                       |   |                                                    |  |                           |         |                                                             |   |         |  |   |         |  |   |         |  |     
|---------------------- |  | ----------------------------------------------------------------------- | ------- | ----------------------------------------------------- | - | -------------------------------------------------- |  | ------------------------- | ------- | ----------------------------------------------------------- | - | ------- |  | - | ------- |  | - | ------- |  | ----
|                       |  | Initial
 Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |   | Gross Amount
 at Which Carried
 at Close of Period |  | Accumulated
 Depreciation |         | Date of
 Initial
 Leasehold or
 Acquisition
 Investment (1)
|                       |  |                                                                         |         |                                                       |   |                                                   
|Description            |  |                                                                         |         | Land                                                  |   | Building
 and
 Improvements                        |  | Total                     |         |                                                            
|                       |  |                                                                         |         |                                                       |   |                                                    |  |                           |         |                                                             |   |         |  |   |         |  |   |         |  |     
|                       |  |                                                                         |         |                                                       |   |                                                    |  |                           |         |                                                             |   |         |  |   |         |  |   |         |  |     
|CEDAR PARK, TX         |  | $                                                                       | 178,507 |                                                       | $ | 0                                                  |  | $                         | 42,091  |                                                             | $ | 136,415 |  | $ | 178,507 |  | $ | 12,414  |  | 2007
|ALBANY, NY             |  |                                                                         | 142,312 |                                                       |   | 36,831                                             |  |                           | 91,600  |                                                             |   | 87,543  |  |   | 179,143 |  |   | 59,357  |  | 1985
|SALISBURY, MA          |  |                                                                         | 119,698 |                                                       |   | 59,615                                             |  |                           | 80,598  |                                                             |   | 98,715  |  |   | 179,313 |  |   | 89,410  |  | 1986
|CARMEL, NY             |  |                                                                         | 20,419  |                                                       |   | 158,943                                            |  |                           | 20,750  |                                                             |   | 158,612 |  |   | 179,362 |  |   | 154,391 |  | 1970
|POTTSTOWN, PA          |  |                                                                         | 166,236 |                                                       |   | 16,010                                             |  |                           | 71,631  |                                                             |   | 110,615 |  |   | 182,246 |  |   | 94,975  |  | 1989
|LONG ISLAND CITY, NY   |  |                                                                         | 90,895  |                                                       |   | 91,386                                             |  |                           | 60,030  |                                                             |   | 122,251 |  |   | 182,281 |  |   | 115,438 |  | 1972
|BOILING SPRINGS, PA    |  |                                                                         | 14,792  |                                                       |   | 167,641                                            |  |                           | 14,792  |                                                             |   | 167,641 |  |   | 182,433 |  |   | 151,310 |  | 1961
|ARLINGTON, TX          |  |                                                                         | 182,460 |                                                       |   | 0                                                  |  |                           | 30,425  |                                                             |   | 152,035 |  |   | 182,460 |  |   | 17,212  |  | 2007
|GREENVILLE, NY         |  |                                                                         | 77,153  |                                                       |   | 105,325                                            |  |                           | 77,152  |                                                             |   | 105,326 |  |   | 182,478 |  |   | 99,023  |  | 1989
|PIERMONT, NY           |  |                                                                         | 151,125 |                                                       |   | 31,470                                             |  |                           | 90,675  |                                                             |   | 91,920  |  |   | 182,595 |  |   | 91,920  |  | 1978
|SOUTH PORTLAND, ME     |  |                                                                         | 176,700 |                                                       |   | 6,938                                              |  |                           | 115,100 |                                                             |   | 68,538  |  |   | 183,638 |  |   | 33,203  |  | 1985
|AUBURN, ME             |  |                                                                         | 105,908 |                                                       |   | 77,928                                             |  |                           | 105,908 |                                                             |   | 77,928  |  |   | 183,836 |  |   | 77,781  |  | 1986
|KINGSTON, NY           |  |                                                                         | 68,341  |                                                       |   | 115,961                                            |  |                           | 44,379  |                                                             |   | 139,923 |  |   | 184,302 |  |   | 136,199 |  | 1971
|HOWELL, NJ             |  |                                                                         | 9,750   |                                                       |   | 174,857                                            |  |                           | 0       |                                                             |   | 184,607 |  |   | 184,607 |  |   | 184,035 |  | 1978
|PITTSFIELD, MA         |  |                                                                         | 97,153  |                                                       |   | 87,874                                             |  |                           | 40,000  |                                                             |   | 145,027 |  |   | 185,027 |  |   | 144,983 |  | 1982
|AGAWAM, MA             |  |                                                                         | 65,000  |                                                       |   | 120,665                                            |  |                           | 0       |                                                             |   | 185,665 |  |   | 185,665 |  |   | 183,366 |  | 1982
|IPSWICH, MA            |  |                                                                         | 138,918 |                                                       |   | 46,831                                             |  |                           | 95,718  |                                                             |   | 90,031  |  |   | 185,749 |  |   | 87,034  |  | 1986
|GETTYSBURG, PA         |  |                                                                         | 157,602 |                                                       |   | 28,530                                             |  |                           | 67,602  |                                                             |   | 118,530 |  |   | 186,132 |  |   | 117,939 |  | 1986
|ATHOL, MA              |  |                                                                         | 164,629 |                                                       |   | 22,016                                             |  |                           | 107,009 |                                                             |   | 79,636  |  |   | 186,645 |  |   | 33,779  |  | 1991
|GLEN ROCK, PA          |  |                                                                         | 20,442  |                                                       |   | 166,633                                            |  |                           | 20,442  |                                                             |   | 166,633 |  |   | 187,075 |  |   | 145,128 |  | 1961
|WHITE PLAINS, NY       |  |                                                                         | 120,393 |                                                       |   | 67,315                                             |  |                           | 0       |                                                             |   | 187,708 |  |   | 187,708 |  |   | 187,708 |  | 1979
|HADLEY, MA             |  |                                                                         | 119,276 |                                                       |   | 68,748                                             |  |                           | 36,080  |                                                             |   | 151,944 |  |   | 188,024 |  |   | 147,948 |  | 1982
|KINGSTON, NY           |  |                                                                         | 29,010  |                                                       |   | 159,986                                            |  |                           | 12,721  |                                                             |   | 176,275 |  |   | 188,996 |  |   | 167,892 |  | 1972
|TONAWANDA, NY          |  |                                                                         | 189,296 |                                                       |   | 0                                                  |  |                           | 147,122 |                                                             |   | 42,174  |  |   | 189,296 |  |   | 15,886  |  | 2000
|SEAFORD, NY            |  |                                                                         | 32,000  |                                                       |   | 157,665                                            |  |                           | 0       |                                                             |   | 189,665 |  |   | 189,665 |  |   | 162,443 |  | 1978
|WISCASSET, ME          |  |                                                                         | 156,587 |                                                       |   | 33,455                                             |  |                           | 90,837  |                                                             |   | 99,205  |  |   | 190,042 |  |   | 99,205  |  | 1986
|BRISTOL, CT            |  |                                                                         | 108,808 |                                                       |   | 81,684                                             |  |                           | 44,000  |                                                             |   | 146,492 |  |   | 190,492 |  |   | 142,705 |  | 1982
|YONKERS, NY            |  |                                                                         | 111,300 |                                                       |   | 80,000                                             |  |                           | 65,000  |                                                             |   | 126,300 |  |   | 191,300 |  |   | 116,522 |  | 1988
|LANGHORNE, PA          |  |                                                                         | 122,202 |                                                       |   | 69,328                                             |  |                           | 50,000  |                                                             |   | 141,530 |  |   | 191,530 |  |   | 96,391  |  | 1987
|DELMAR, NY             |  |                                                                         | 150,000 |                                                       |   | 42,478                                             |  |                           | 70,000  |                                                             |   | 122,478 |  |   | 192,478 |  |   | 118,294 |  | 1986
|HUNTINGTON STATION, NY |  |                                                                         | 140,735 |                                                       |   | 52,045                                             |  |                           | 84,000  |                                                             |   | 108,780 |  |   | 192,780 |  |   | 108,416 |  | 1978
|MECHANICSVILLE, VA     |  |                                                                         | 0       |                                                       |   | 193,088                                            |  |                           | 193,088 |                                                             |   | 0       |  |   | 193,088 |  |   | 0       |  | 2005

70

---



|                   |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|------------------ |  | ----------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | -------------------------------------------------- |  | ------------------------- | ------- | ----------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                   |  | Initial
 Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount
 at Which Carried
 at Close of Period |  | Accumulated
 Depreciation |         | Date of
 Initial
 Leasehold or
 Acquisition
 Investment (1)
|                   |  |                                                                         |         |                                                       |  |                                                   
|Description        |  |                                                                         |         | Land                                                  |  | Building
 and
 Improvements                        |  | Total                     |         |                                                            
|                   |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|                   |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|CHRISTIANA, PA     |  |                                                                         | 182,593 |                                                       |  | 11,178                                             |  |                           | 65,212  |                                                             |  | 128,559 |  |  | 193,771 |  |  | 128,559 |  | 1989
|LINWOOD, PA        |  |                                                                         | 171,518 |                                                       |  | 22,371                                             |  |                           | 102,968 |                                                             |  | 90,921  |  |  | 193,889 |  |  | 89,412  |  | 1987
|OZONE PARK, NY     |  |                                                                         | 0       |                                                       |  | 193,968                                            |  |                           | 0       |                                                             |  | 193,968 |  |  | 193,968 |  |  | 193,968 |  | 1986
|ELMONT, NY         |  |                                                                         | 108,348 |                                                       |  | 85,793                                             |  |                           | 64,290  |                                                             |  | 129,851 |  |  | 194,141 |  |  | 96,559  |  | 1982
|ROTHSVILLE, PA     |  |                                                                         | 169,550 |                                                       |  | 25,188                                             |  |                           | 52,169  |                                                             |  | 142,569 |  |  | 194,738 |  |  | 142,569 |  | 1989
|OLD BRIDGE, NJ     |  |                                                                         | 85,617  |                                                       |  | 109,980                                            |  |                           | 56,190  |                                                             |  | 139,407 |  |  | 195,597 |  |  | 138,339 |  | 1972
|BREWSTER, NY       |  |                                                                         | 117,603 |                                                       |  | 78,076                                             |  |                           | 72,403  |                                                             |  | 123,276 |  |  | 195,679 |  |  | 116,856 |  | 1972
|BLOOMFIELD, CT     |  |                                                                         | 141,452 |                                                       |  | 54,786                                             |  |                           | 90,000  |                                                             |  | 106,238 |  |  | 196,238 |  |  | 102,146 |  | 1986
|JACKSONVILLE, FL   |  |                                                                         | 196,764 |                                                       |  | 0                                                  |  |                           | 114,434 |                                                             |  | 82,330  |  |  | 196,764 |  |  | 31,009  |  | 2000
|EPHRATA, PA        |  |                                                                         | 187,843 |                                                       |  | 9,400                                              |  |                           | 65,212  |                                                             |  | 132,031 |  |  | 197,243 |  |  | 131,124 |  | 1989
|BRONX, NY          |  |                                                                         | 95,328  |                                                       |  | 102,639                                            |  |                           | 73,750  |                                                             |  | 124,217 |  |  | 197,967 |  |  | 118,171 |  | 1976
|RAVENA, NY         |  |                                                                         | 0       |                                                       |  | 199,900                                            |  |                           | 0       |                                                             |  | 199,900 |  |  | 199,900 |  |  | 193,108 |  | 1991
|BROOKLYN, NY       |  |                                                                         | 74,808  |                                                       |  | 125,120                                            |  |                           | 30,694  |                                                             |  | 169,234 |  |  | 199,928 |  |  | 164,543 |  | 1967
|POUGHKEEPSIE, NY   |  |                                                                         | 32,885  |                                                       |  | 168,354                                            |  |                           | 35,904  |                                                             |  | 165,335 |  |  | 201,239 |  |  | 158,649 |  | 1971
|JACKSONVILLE, FL   |  |                                                                         | 201,477 |                                                       |  | 0                                                  |  |                           | 117,907 |                                                             |  | 83,570  |  |  | 201,477 |  |  | 31,479  |  | 2000
|DOUGLASSVILLE, PA  |  |                                                                         | 178,488 |                                                       |  | 23,321                                             |  |                           | 128,738 |                                                             |  | 73,071  |  |  | 201,809 |  |  | 73,071  |  | 1990
|CATSKILL, NY       |  |                                                                         | 104,447 |                                                       |  | 99,076                                             |  |                           | 203,523 |                                                             |  | 0       |  |  | 203,523 |  |  | 0       |  | 1989
|RHINEBECK, NY      |  |                                                                         | 203,658 |                                                       |  | 0                                                  |  |                           | 101,829 |                                                             |  | 101,829 |  |  | 203,658 |  |  | 9,505   |  | 2007
|QUARRYVILLE, NY    |  |                                                                         | 35,917  |                                                       |  | 168,199                                            |  |                           | 35,916  |                                                             |  | 168,200 |  |  | 204,116 |  |  | 161,348 |  | 1988
|LEXINGTON, NC      |  |                                                                         | 204,139 |                                                       |  | 0                                                  |  |                           | 43,311  |                                                             |  | 160,828 |  |  | 204,139 |  |  | 17,602  |  | 2007
|EXETER, NH         |  |                                                                         | 160,000 |                                                       |  | 44,343                                             |  |                           | 105,000 |                                                             |  | 99,343  |  |  | 204,343 |  |  | 83,837  |  | 1986
|MIDDLE VILLAGE, NY |  |                                                                         | 130,684 |                                                       |  | 73,741                                             |  |                           | 89,960  |                                                             |  | 114,465 |  |  | 204,425 |  |  | 108,299 |  | 1972
|LEWISTON, NY       |  |                                                                         | 205,000 |                                                       |  | 0                                                  |  |                           | 125,000 |                                                             |  | 80,000  |  |  | 205,000 |  |  | 30,133  |  | 2000
|MIDLAND PARK, NJ   |  |                                                                         | 201,012 |                                                       |  | 4,080                                              |  |                           | 150,000 |                                                             |  | 55,092  |  |  | 205,092 |  |  | 49,668  |  | 1989
|AUBURN, MA         |  |                                                                         | 175,048 |                                                       |  | 30,890                                             |  |                           | 125,048 |                                                             |  | 80,890  |  |  | 205,938 |  |  | 80,639  |  | 1986
|LAKEWOOD, NJ       |  |                                                                         | 130,148 |                                                       |  | 77,265                                             |  |                           | 70,148  |                                                             |  | 137,265 |  |  | 207,413 |  |  | 136,702 |  | 1978
|CLINTON, MA        |  |                                                                         | 177,978 |                                                       |  | 29,790                                             |  |                           | 115,686 |                                                             |  | 92,082  |  |  | 207,768 |  |  | 43,245  |  | 1992
|TOLLAND, CT        |  |                                                                         | 107,902 |                                                       |  | 100,178                                            |  |                           | 44,000  |                                                             |  | 164,080 |  |  | 208,080 |  |  | 161,058 |  | 1982
|BALDWIN, NY        |  |                                                                         | 101,952 |                                                       |  | 106,328                                            |  |                           | 61,552  |                                                             |  | 146,728 |  |  | 208,280 |  |  | 112,964 |  | 1978
|NORTH BABYLON, NY  |  |                                                                         | 91,888  |                                                       |  | 117,066                                            |  |                           | 59,059  |                                                             |  | 149,895 |  |  | 208,954 |  |  | 147,091 |  | 1978
|NEW YORK, NY       |  |                                                                         | 106,363 |                                                       |  | 103,035                                            |  |                           | 79,275  |                                                             |  | 130,123 |  |  | 209,398 |  |  | 126,852 |  | 1976
|HANCOCK, NY        |  |                                                                         | 100,000 |                                                       |  | 109,470                                            |  |                           | 50,000  |                                                             |  | 159,470 |  |  | 209,470 |  |  | 155,229 |  | 1986
|WATERFORD, CT      |  |                                                                         | 76,981  |                                                       |  | 133,059                                            |  |                           | 0       |                                                             |  | 210,040 |  |  | 210,040 |  |  | 202,481 |  | 1982
|AMITYVILLE, NY     |  |                                                                         | 70,246  |                                                       |  | 139,953                                            |  |                           | 42,148  |                                                             |  | 168,051 |  |  | 210,199 |  |  | 168,051 |  | 1978
|OCEANSIDE, NY      |  |                                                                         | 40,378  |                                                       |  | 169,929                                            |  |                           | 40,000  |                                                             |  | 170,307 |  |  | 210,307 |  |  | 137,354 |  | 1970
|MENANDS, NY        |  |                                                                         | 150,580 |                                                       |  | 60,563                                             |  |                           | 49,999  |                                                             |  | 161,144 |  |  | 211,143 |  |  | 147,689 |  | 1988
|WILLIAMSVILLE, NY  |  |                                                                         | 211,972 |                                                       |  | 0                                                  |  |                           | 176,643 |                                                             |  | 35,329  |  |  | 211,972 |  |  | 13,306  |  | 2000
|PELHAM MANOR, NY   |  |                                                                         | 127,304 |                                                       |  | 85,087                                             |  |                           | 75,800  |                                                             |  | 136,591 |  |  | 212,391 |  |  | 126,720 |  | 1972
|MILLER PLACE, NY   |  |                                                                         | 110,000 |                                                       |  | 103,160                                            |  |                           | 66,000  |                                                             |  | 147,160 |  |  | 213,160 |  |  | 145,331 |  | 1978
|BRONX, NY          |  |                                                                         | 93,817  |                                                       |  | 120,396                                            |  |                           | 67,200  |                                                             |  | 147,013 |  |  | 214,213 |  |  | 124,497 |  | 1985
|MILFORD, MA        |  |                                                                         | 0       |                                                       |  | 214,331                                            |  |                           | 0       |                                                             |  | 214,331 |  |  | 214,331 |  |  | 173,037 |  | 1985
|BLUEPOINT, NY      |  |                                                                         | 96,163  |                                                       |  | 118,524                                            |  |                           | 96,068  |                                                             |  | 118,619 |  |  | 214,687 |  |  | 114,006 |  | 1972
|MOUNTVILLE, PA     |  |                                                                         | 195,635 |                                                       |  | 19,506                                             |  |                           | 78,254  |                                                             |  | 136,887 |  |  | 215,141 |  |  | 136,887 |  | 1989
|BAY SHORE, NY      |  |                                                                         | 188,900 |                                                       |  | 26,286                                             |  |                           | 123,000 |                                                             |  | 92,186  |  |  | 215,186 |  |  | 53,485  |  | 1985
|N. WINDHAM, ME     |  |                                                                         | 161,365 |                                                       |  | 53,923                                             |  |                           | 86,365  |                                                             |  | 128,923 |  |  | 215,288 |  |  | 128,884 |  | 1986
|TEWKSBURY, MA      |  |                                                                         | 125,000 |                                                       |  | 90,338                                             |  |                           | 75,000  |                                                             |  | 140,338 |  |  | 215,338 |  |  | 134,274 |  | 1986
|STRATFORD, NJ      |  |                                                                         | 215,597 |                                                       |  | 0                                                  |  |                           | 0       |                                                             |  | 215,597 |  |  | 215,597 |  |  | 206,617 |  | 1995
|PELHAM MANOR, NY   |  |                                                                         | 136,791 |                                                       |  | 78,987                                             |  |                           | 75,000  |                                                             |  | 140,778 |  |  | 215,778 |  |  | 137,650 |  | 1985
|SEABROOK, NH       |  |                                                                         | 199,780 |                                                       |  | 19,102                                             |  |                           | 124,780 |                                                             |  | 94,102  |  |  | 218,882 |  |  | 93,844  |  | 1986
|FRANKLIN, CT       |  |                                                                         | 50,904  |                                                       |  | 168,470                                            |  |                           | 20,232  |                                                             |  | 199,142 |  |  | 219,374 |  |  | 198,201 |  | 1982
|WESTFIELD, MA      |  |                                                                         | 123,323 |                                                       |  | 96,093                                             |  |                           | 50,000  |                                                             |  | 169,416 |  |  | 219,416 |  |  | 166,343 |  | 1982
|HAMPTON, NH        |  |                                                                         | 193,103 |                                                       |  | 26,449                                             |  |                           | 135,598 |                                                             |  | 83,954  |  |  | 219,552 |  |  | 83,589  |  | 1986
|MIDDLETOWN, CT     |  |                                                                         | 133,022 |                                                       |  | 86,915                                             |  |                           | 131,312 |                                                             |  | 88,625  |  |  | 219,937 |  |  | 88,625  |  | 1987
|WORCESTER, MA      |  |                                                                         | 186,877 |                                                       |  | 33,510                                             |  |                           | 121,470 |                                                             |  | 98,917  |  |  | 220,387 |  |  | 47,387  |  | 1993
|STONY BROOK, NY    |  |                                                                         | 175,921 |                                                       |  | 44,529                                             |  |                           | 105,000 |                                                             |  | 115,450 |  |  | 220,450 |  |  | 114,507 |  | 1978
|YONKERS, NY        |  |                                                                         | 153,184 |                                                       |  | 67,266                                             |  |                           | 76,592  |                                                             |  | 143,858 |  |  | 220,450 |  |  | 78,260  |  | 1987
|EMMITSBURG, MD     |  |                                                                         | 146,949 |                                                       |  | 73,613                                             |  |                           | 101,949 |                                                             |  | 118,613 |  |  | 220,562 |  |  | 118,392 |  | 1986
|MANCHESTER, CT     |  |                                                                         | 65,590  |                                                       |  | 156,628                                            |  |                           | 64,750  |                                                             |  | 157,468 |  |  | 222,218 |  |  | 156,833 |  | 1982
|STATEN ISLAND, NY  |  |                                                                         | 0       |                                                       |  | 222,525                                            |  |                           | 0       |                                                             |  | 222,525 |  |  | 222,525 |  |  | 222,525 |  | 1981
|PELHAM, NH         |  |                                                                         | 169,182 |                                                       |  | 53,497                                             |  |                           | 136,077 |                                                             |  | 86,602  |  |  | 222,679 |  |  | 80,417  |  | 1986
|AMHERST, NY        |  |                                                                         | 223,009 |                                                       |  | 0                                                  |  |                           | 173,451 |                                                             |  | 49,558  |  |  | 223,009 |  |  | 29,860  |  | 2000
|NEW ROCHELLE, NY   |  |                                                                         | 188,932 |                                                       |  | 34,649                                             |  |                           | 103,932 |                                                             |  | 119,649 |  |  | 223,581 |  |  | 119,017 |  | 1982

71

---



|                    |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|------------------- |  | ----------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | -------------------------------------------------- |  | ------------------------- | ------- | ----------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                    |  | Initial
 Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount
 at Which Carried
 at Close of Period |  | Accumulated
 Depreciation |         | Date of
 Initial
 Leasehold or
 Acquisition
 Investment (1)
|                    |  |                                                                         |         |                                                       |  |                                                   
|Description         |  |                                                                         |         | Land                                                  |  | Building
 and
 Improvements                        |  | Total                     |         |                                                            
|                    |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|                    |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|SOMERSWORTH, NH     |  |                                                                         | 210,805 |                                                       |  | 15,012                                             |  |                           | 157,520 |                                                             |  | 68,297  |  |  | 225,817 |  |  | 68,169  |  | 1986
|RED HOOK, NY        |  |                                                                         | 0       |                                                       |  | 226,787                                            |  |                           | 0       |                                                             |  | 226,787 |  |  | 226,787 |  |  | 220,274 |  | 1991
|BRIDGEWATER, MA     |  |                                                                         | 190,360 |                                                       |  | 36,762                                             |  |                           | 140,000 |                                                             |  | 87,122  |  |  | 227,122 |  |  | 81,814  |  | 1987
|BROOKLYN, NY        |  |                                                                         | 135,693 |                                                       |  | 91,946                                             |  |                           | 100,035 |                                                             |  | 127,604 |  |  | 227,639 |  |  | 107,679 |  | 1972
|NEW YORK, NY        |  |                                                                         | 0       |                                                       |  | 229,435                                            |  |                           | 0       |                                                             |  | 229,435 |  |  | 229,435 |  |  | 229,433 |  | 1985
|HYANNIS, MA         |  |                                                                         | 222,472 |                                                       |  | 7,282                                              |  |                           | 144,607 |                                                             |  | 85,147  |  |  | 229,754 |  |  | 24,909  |  | 1991
|LAGRANGEVILLE, NY   |  |                                                                         | 129,133 |                                                       |  | 101,140                                            |  |                           | 64,626  |                                                             |  | 165,647 |  |  | 230,273 |  |  | 163,995 |  | 1972
|PINE HILL, NJ       |  |                                                                         | 190,568 |                                                       |  | 39,918                                             |  |                           | 115,568 |                                                             |  | 114,918 |  |  | 230,486 |  |  | 112,628 |  | 1986
|TREVOSE, PA         |  |                                                                         | 215,214 |                                                       |  | 16,382                                             |  |                           | 150,000 |                                                             |  | 81,596  |  |  | 231,596 |  |  | 71,123  |  | 1987
|MILFORD, NH         |  |                                                                         | 190,000 |                                                       |  | 41,689                                             |  |                           | 115,000 |                                                             |  | 116,689 |  |  | 231,689 |  |  | 112,700 |  | 1986
|W. HAVERSTRAW, NY   |  |                                                                         | 194,181 |                                                       |  | 38,141                                             |  |                           | 140,000 |                                                             |  | 92,322  |  |  | 232,322 |  |  | 87,313  |  | 1978
|MERIDEN, CT         |  |                                                                         | 126,188 |                                                       |  | 106,805                                            |  |                           | 72,344  |                                                             |  | 160,649 |  |  | 232,993 |  |  | 155,320 |  | 1982
|LANCASTER, PA       |  |                                                                         | 208,677 |                                                       |  | 24,347                                             |  |                           | 78,254  |                                                             |  | 154,770 |  |  | 233,024 |  |  | 154,770 |  | 1989
|WEST HAVEN, CT      |  |                                                                         | 185,138 |                                                       |  | 48,619                                             |  |                           | 74,000  |                                                             |  | 159,757 |  |  | 233,757 |  |  | 157,837 |  | 1982
|LEOMINSTER, MA      |  |                                                                         | 185,040 |                                                       |  | 49,592                                             |  |                           | 85,040  |                                                             |  | 149,592 |  |  | 234,632 |  |  | 147,070 |  | 1986
|PELHAM, NH          |  |                                                                         | 0       |                                                       |  | 234,915                                            |  |                           | 0       |                                                             |  | 234,915 |  |  | 234,915 |  |  | 140,743 |  | 1996
|NEW MILFORD, CT     |  |                                                                         | 113,947 |                                                       |  | 121,174                                            |  |                           | 0       |                                                             |  | 235,121 |  |  | 235,121 |  |  | 231,921 |  | 1982
|EBENEZER, PA        |  |                                                                         | 147,058 |                                                       |  | 88,474                                             |  |                           | 68,804  |                                                             |  | 166,728 |  |  | 235,532 |  |  | 144,565 |  | 1989
|STOUGHTON, MA       |  |                                                                         | 0       |                                                       |  | 235,794                                            |  |                           | 0       |                                                             |  | 235,794 |  |  | 235,794 |  |  | 200,384 |  | 1990
|QUINCY, MA          |  |                                                                         | 200,000 |                                                       |  | 36,112                                             |  |                           | 125,000 |                                                             |  | 111,112 |  |  | 236,112 |  |  | 109,396 |  | 1986
|HARWICH, MA         |  |                                                                         | 225,000 |                                                       |  | 12,044                                             |  |                           | 150,000 |                                                             |  | 87,044  |  |  | 237,044 |  |  | 84,250  |  | 1986
|NORTH KINGSTOWN, RI |  |                                                                         | 211,835 |                                                       |  | 25,971                                             |  |                           | 89,135  |                                                             |  | 148,671 |  |  | 237,806 |  |  | 147,346 |  | 1985
|KENHORST, PA        |  |                                                                         | 143,466 |                                                       |  | 94,592                                             |  |                           | 65,212  |                                                             |  | 172,846 |  |  | 238,058 |  |  | 154,465 |  | 1989
|BOYERTOWN, PA       |  |                                                                         | 233,000 |                                                       |  | 5,373                                              |  |                           | 151,700 |                                                             |  | 86,673  |  |  | 238,373 |  |  | 40,875  |  | 1985
|ATCO, NJ            |  |                                                                         | 153,159 |                                                       |  | 85,853                                             |  |                           | 131,766 |                                                             |  | 107,246 |  |  | 239,012 |  |  | 107,063 |  | 1987
|SPRINGFIELD, MA     |  |                                                                         | 0       |                                                       |  | 239,087                                            |  |                           | 0       |                                                             |  | 239,087 |  |  | 239,087 |  |  | 183,746 |  | 1984
|COLUMBIA, PA        |  |                                                                         | 225,906 |                                                       |  | 13,206                                             |  |                           | 75,000  |                                                             |  | 164,112 |  |  | 239,112 |  |  | 139,513 |  | 1989
|PAWTUCKET, RI       |  |                                                                         | 237,100 |                                                       |  | 2,990                                              |  |                           | 154,400 |                                                             |  | 85,690  |  |  | 240,090 |  |  | 39,103  |  | 1985
|NEW HAVEN, CT       |  |                                                                         | 217,000 |                                                       |  | 23,889                                             |  |                           | 141,300 |                                                             |  | 99,589  |  |  | 240,889 |  |  | 55,976  |  | 1985
|ROTTERDAM, NY       |  |                                                                         | 140,600 |                                                       |  | 100,399                                            |  |                           | 91,600  |                                                             |  | 149,399 |  |  | 240,999 |  |  | 112,696 |  | 1985
|SACO, ME            |  |                                                                         | 204,006 |                                                       |  | 37,173                                             |  |                           | 150,694 |                                                             |  | 90,485  |  |  | 241,179 |  |  | 90,385  |  | 1986
|SOMERSWORTH, NH     |  |                                                                         | 180,800 |                                                       |  | 60,497                                             |  |                           | 117,700 |                                                             |  | 123,597 |  |  | 241,297 |  |  | 72,820  |  | 1985
|PITTSFIELD, MA      |  |                                                                         | 123,167 |                                                       |  | 118,273                                            |  |                           | 50,000  |                                                             |  | 191,440 |  |  | 241,440 |  |  | 190,690 |  | 1982
|BRONX, NY           |  |                                                                         | 45,044  |                                                       |  | 196,956                                            |  |                           | 10,044  |                                                             |  | 231,956 |  |  | 242,000 |  |  | 202,976 |  | 1976
|LEWISTON, ME        |  |                                                                         | 180,338 |                                                       |  | 62,629                                             |  |                           | 101,338 |                                                             |  | 141,629 |  |  | 242,967 |  |  | 139,558 |  | 1986
|LAKE RONKONKOMA, NY |  |                                                                         | 87,097  |                                                       |  | 156,576                                            |  |                           | 51,000  |                                                             |  | 192,673 |  |  | 243,673 |  |  | 189,671 |  | 1978
|HANOVER, PA         |  |                                                                         | 231,028 |                                                       |  | 13,252                                             |  |                           | 70,000  |                                                             |  | 174,280 |  |  | 244,280 |  |  | 155,369 |  | 1989
|NEW WINDSOR, NY     |  |                                                                         | 150,000 |                                                       |  | 94,791                                             |  |                           | 75,000  |                                                             |  | 169,791 |  |  | 244,791 |  |  | 157,978 |  | 1986
|HILLSBOROUGH, NJ    |  |                                                                         | 237,122 |                                                       |  | 7,729                                              |  |                           | 100,000 |                                                             |  | 144,851 |  |  | 244,851 |  |  | 67,608  |  | 1985
|DEDHAM, MA          |  |                                                                         | 225,824 |                                                       |  | 19,150                                             |  |                           | 125,824 |                                                             |  | 119,150 |  |  | 244,974 |  |  | 118,859 |  | 1987
|POTTSVILLE, PA      |  |                                                                         | 162,402 |                                                       |  | 82,769                                             |  |                           | 43,471  |                                                             |  | 201,700 |  |  | 245,171 |  |  | 188,055 |  | 1990
|YONKERS, NY         |  |                                                                         | 202,826 |                                                       |  | 42,877                                             |  |                           | 144,000 |                                                             |  | 101,703 |  |  | 245,703 |  |  | 86,111  |  | 1986
|OSSINING, NY        |  |                                                                         | 140,992 |                                                       |  | 104,761                                            |  |                           | 97,527  |                                                             |  | 148,226 |  |  | 245,753 |  |  | 141,908 |  | 1982
|WELLSVILLE, NY      |  |                                                                         | 247,281 |                                                       |  | 0                                                  |  |                           | 0       |                                                             |  | 247,281 |  |  | 247,281 |  |  | 28,025  |  | 2006
|MERIDEN, CT         |  |                                                                         | 207,873 |                                                       |  | 39,829                                             |  |                           | 84,000  |                                                             |  | 163,702 |  |  | 247,702 |  |  | 162,841 |  | 1982
|BETHPAGE, NY        |  |                                                                         | 210,990 |                                                       |  | 38,356                                             |  |                           | 126,000 |                                                             |  | 123,346 |  |  | 249,346 |  |  | 122,757 |  | 1978
|COTTAGE HILLS, IL   |  |                                                                         | 249,419 |                                                       |  | 0                                                  |  |                           | 26,199  |                                                             |  | 223,220 |  |  | 249,419 |  |  | 24,030  |  | 2007
|LACKAWANNA, NY      |  |                                                                         | 250,030 |                                                       |  | 0                                                  |  |                           | 129,870 |                                                             |  | 120,160 |  |  | 250,030 |  |  | 56,548  |  | 2000
|RED LION, PA        |  |                                                                         | 221,719 |                                                       |  | 29,788                                             |  |                           | 52,169  |                                                             |  | 199,338 |  |  | 251,507 |  |  | 197,653 |  | 1989
|BETHLEHEM, PA       |  |                                                                         | 208,677 |                                                       |  | 42,927                                             |  |                           | 130,423 |                                                             |  | 121,181 |  |  | 251,604 |  |  | 118,994 |  | 1989
|CROMWELL, CT        |  |                                                                         | 70,017  |                                                       |  | 183,119                                            |  |                           | 24,000  |                                                             |  | 229,136 |  |  | 253,136 |  |  | 229,136 |  | 1982
|BELLEVILLE, NJ      |  |                                                                         | 215,468 |                                                       |  | 38,163                                             |  |                           | 149,237 |                                                             |  | 104,394 |  |  | 253,631 |  |  | 103,157 |  | 1986
|BRISTOL, CT         |  |                                                                         | 253,639 |                                                       |  | 0                                                  |  |                           | 149,553 |                                                             |  | 104,086 |  |  | 253,639 |  |  | 17,346  |  | 2004
|CENTRAL ISLIP, NY   |  |                                                                         | 103,183 |                                                       |  | 151,449                                            |  |                           | 61,435  |                                                             |  | 193,197 |  |  | 254,632 |  |  | 193,197 |  | 1978
|PORTSMOUTH, NH      |  |                                                                         | 235,000 |                                                       |  | 20,257                                             |  |                           | 150,000 |                                                             |  | 105,257 |  |  | 255,257 |  |  | 104,984 |  | 1986
|HAWTHORNE, NJ       |  |                                                                         | 245,100 |                                                       |  | 10,967                                             |  |                           | 159,600 |                                                             |  | 96,467  |  |  | 256,067 |  |  | 48,303  |  | 1985
|COLONIA, NJ         |  |                                                                         | 253,100 |                                                       |  | 3,395                                              |  |                           | 164,800 |                                                             |  | 91,695  |  |  | 256,495 |  |  | 41,954  |  | 1985
|HILLSIDE, NJ        |  |                                                                         | 225,000 |                                                       |  | 31,552                                             |  |                           | 150,000 |                                                             |  | 106,552 |  |  | 256,552 |  |  | 105,238 |  | 1987
|S. WEYMOUTH, MA     |  |                                                                         | 211,891 |                                                       |  | 44,893                                             |  |                           | 256,784 |                                                             |  | 0       |  |  | 256,784 |  |  | 0       |  | 1985
|WEST SENECA, NY     |  |                                                                         | 257,142 |                                                       |  | 0                                                  |  |                           | 184,385 |                                                             |  | 72,757  |  |  | 257,142 |  |  | 27,411  |  | 2000
|WEST YARMOUTH, MA   |  |                                                                         | 225,000 |                                                       |  | 33,165                                             |  |                           | 125,000 |                                                             |  | 133,165 |  |  | 258,165 |  |  | 132,212 |  | 1986

72

---



|                     |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|-------------------- |  | ----------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | -------------------------------------------------- |  | ------------------------- | ------- | ----------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                     |  | Initial
 Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount
 at Which Carried
 at Close of Period |  | Accumulated
 Depreciation |         | Date of
 Initial
 Leasehold or
 Acquisition
 Investment (1)
|                     |  |                                                                         |         |                                                       |  |                                                   
|Description          |  |                                                                         |         | Land                                                  |  | Building
 and
 Improvements                        |  | Total                     |         |                                                            
|                     |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|                     |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|LONG ISLAND CITY, NY |  |                                                                         | 106,592 |                                                       |  | 151,819                                            |  |                           | 73,260  |                                                             |  | 185,151 |  |  | 258,411 |  |  | 156,275 |  | 1976
|CLIFTON HGTS, PA     |  |                                                                         | 213,000 |                                                       |  | 46,824                                             |  |                           | 138,700 |                                                             |  | 121,124 |  |  | 259,824 |  |  | 77,026  |  | 1985
|ENFIELD, CT          |  |                                                                         | 259,881 |                                                       |  | 0                                                  |  |                           | 0       |                                                             |  | 259,881 |  |  | 259,881 |  |  | 127,392 |  | 2004
|SHREWSBURY, PA       |  |                                                                         | 132,993 |                                                       |  | 126,898                                            |  |                           | 52,832  |                                                             |  | 207,059 |  |  | 259,891 |  |  | 176,046 |  | 1989
|REINHOLDS, PA        |  |                                                                         | 176,520 |                                                       |  | 83,686                                             |  |                           | 82,017  |                                                             |  | 178,189 |  |  | 260,206 |  |  | 153,485 |  | 1989
|EPHRATA, PA          |  |                                                                         | 208,604 |                                                       |  | 52,826                                             |  |                           | 30,000  |                                                             |  | 231,430 |  |  | 261,430 |  |  | 173,272 |  | 1989
|MILFORD, MA          |  |                                                                         | 0       |                                                       |  | 262,436                                            |  |                           | 0       |                                                             |  | 262,436 |  |  | 262,436 |  |  | 192,695 |  | 1991
|EXETER, NH           |  |                                                                         | 113,285 |                                                       |  | 149,265                                            |  |                           | 65,000  |                                                             |  | 197,550 |  |  | 262,550 |  |  | 188,505 |  | 1986
|EAST HILLS, NY       |  |                                                                         | 241,613 |                                                       |  | 21,070                                             |  |                           | 241,613 |                                                             |  | 21,070  |  |  | 262,683 |  |  | 20,248  |  | 1986
|STONY POINT, NY      |  |                                                                         | 59,329  |                                                       |  | 203,448                                            |  |                           | 55,800  |                                                             |  | 206,977 |  |  | 262,777 |  |  | 199,852 |  | 1971
|HYDE PARK, NY        |  |                                                                         | 253,100 |                                                       |  | 12,015                                             |  |                           | 139,100 |                                                             |  | 126,015 |  |  | 265,115 |  |  | 109,042 |  | 1985
|READING, PA          |  |                                                                         | 182,592 |                                                       |  | 82,812                                             |  |                           | 104,338 |                                                             |  | 161,066 |  |  | 265,404 |  |  | 144,701 |  | 1989
|HARTFORD, CT         |  |                                                                         | 233,000 |                                                       |  | 32,563                                             |  |                           | 151,700 |                                                             |  | 113,863 |  |  | 265,563 |  |  | 65,422  |  | 1985
|SOUTH PORTLAND, ME   |  |                                                                         | 180,689 |                                                       |  | 84,980                                             |  |                           | 110,689 |                                                             |  | 154,980 |  |  | 265,669 |  |  | 154,980 |  | 1986
|BRIDGEPORT, CT       |  |                                                                         | 245,100 |                                                       |  | 20,652                                             |  |                           | 159,600 |                                                             |  | 106,152 |  |  | 265,752 |  |  | 56,447  |  | 1985
|READING, PA          |  |                                                                         | 129,284 |                                                       |  | 137,863                                            |  |                           | 65,352  |                                                             |  | 201,795 |  |  | 267,147 |  |  | 167,329 |  | 1989
|E. PATCHOGUE, NY     |  |                                                                         | 57,049  |                                                       |  | 210,390                                            |  |                           | 34,213  |                                                             |  | 233,226 |  |  | 267,439 |  |  | 231,219 |  | 1978
|CLAYMONT, DE         |  |                                                                         | 237,200 |                                                       |  | 30,878                                             |  |                           | 151,700 |                                                             |  | 116,378 |  |  | 268,078 |  |  | 69,812  |  | 1985
|EAST HARTFORD, CT    |  |                                                                         | 208,004 |                                                       |  | 60,493                                             |  |                           | 84,000  |                                                             |  | 184,497 |  |  | 268,497 |  |  | 184,155 |  | 1982
|NEPTUNE CITY, NJ     |  |                                                                         | 269,600 |                                                       |  | 0                                                  |  |                           | 175,600 |                                                             |  | 94,000  |  |  | 269,600 |  |  | 41,048  |  | 1985
|OAKHURST, NJ         |  |                                                                         | 225,608 |                                                       |  | 46,405                                             |  |                           | 100,608 |                                                             |  | 171,405 |  |  | 272,013 |  |  | 169,702 |  | 1985
|FRANKLIN, MA         |  |                                                                         | 253,619 |                                                       |  | 18,437                                             |  |                           | 164,852 |                                                             |  | 107,204 |  |  | 272,056 |  |  | 37,758  |  | 1988
|AGAWAM, MA           |  |                                                                         | 209,555 |                                                       |  | 63,621                                             |  |                           | 136,000 |                                                             |  | 137,176 |  |  | 273,176 |  |  | 93,909  |  | 1985
|WAPPINGERS FALLS, NY |  |                                                                         | 114,185 |                                                       |  | 159,162                                            |  |                           | 111,785 |                                                             |  | 161,562 |  |  | 273,347 |  |  | 154,655 |  | 1971
|BRONX, NY            |  |                                                                         | 90,176  |                                                       |  | 183,197                                            |  |                           | 40,176  |                                                             |  | 233,197 |  |  | 273,373 |  |  | 201,037 |  | 1976
|COLONIE, NY          |  |                                                                         | 245,150 |                                                       |  | 28,322                                             |  |                           | 120,150 |                                                             |  | 153,322 |  |  | 273,472 |  |  | 149,666 |  | 1986
|RIDGEFIELD PARK, NJ  |  |                                                                         | 273,549 |                                                       |  | 0                                                  |  |                           | 150,000 |                                                             |  | 123,549 |  |  | 273,549 |  |  | 88,159  |  | 1997
|NORTHPORT, NY        |  |                                                                         | 241,100 |                                                       |  | 33,036                                             |  |                           | 157,000 |                                                             |  | 117,136 |  |  | 274,136 |  |  | 69,360  |  | 1985
|SOUTHINGTON, CT      |  |                                                                         | 115,750 |                                                       |  | 158,561                                            |  |                           | 70,750  |                                                             |  | 203,561 |  |  | 274,311 |  |  | 202,983 |  | 1982
|FRANKLIN SQUARE, NY  |  |                                                                         | 152,572 |                                                       |  | 121,756                                            |  |                           | 137,315 |                                                             |  | 137,013 |  |  | 274,328 |  |  | 94,541  |  | 1978
|SANFORD, ME          |  |                                                                         | 265,523 |                                                       |  | 9,178                                              |  |                           | 201,316 |                                                             |  | 73,385  |  |  | 274,701 |  |  | 73,385  |  | 1986
|ARENDTSVILLE, PA     |  |                                                                         | 173,759 |                                                       |  | 101,020                                            |  |                           | 32,603  |                                                             |  | 242,176 |  |  | 274,779 |  |  | 219,328 |  | 1989
|OSSINING, NY         |  |                                                                         | 231,100 |                                                       |  | 44,049                                             |  |                           | 149,200 |                                                             |  | 125,949 |  |  | 275,149 |  |  | 75,785  |  | 1985
|WILMINGTON, DE       |  |                                                                         | 242,800 |                                                       |  | 32,615                                             |  |                           | 158,100 |                                                             |  | 117,315 |  |  | 275,415 |  |  | 69,602  |  | 1985
|LAURELDALE, PA       |  |                                                                         | 262,079 |                                                       |  | 15,550                                             |  |                           | 86,941  |                                                             |  | 190,688 |  |  | 277,629 |  |  | 188,178 |  | 1989
|BRONX, NY            |  |                                                                         | 0       |                                                       |  | 278,517                                            |  |                           | 0       |                                                             |  | 278,517 |  |  | 278,517 |  |  | 224,698 |  | 1976
|BAY SHORE, NY        |  |                                                                         | 156,382 |                                                       |  | 123,032                                            |  |                           | 85,854  |                                                             |  | 193,560 |  |  | 279,414 |  |  | 189,628 |  | 1981
|NORTH GRAFTON, MA    |  |                                                                         | 244,720 |                                                       |  | 35,136                                             |  |                           | 159,068 |                                                             |  | 120,788 |  |  | 279,856 |  |  | 51,708  |  | 1991
|NEFFSVILLE, PA       |  |                                                                         | 234,761 |                                                       |  | 45,637                                             |  |                           | 91,296  |                                                             |  | 189,102 |  |  | 280,398 |  |  | 185,596 |  | 1989
|EPHRATA, PA          |  |                                                                         | 183,477 |                                                       |  | 96,937                                             |  |                           | 136,809 |                                                             |  | 143,605 |  |  | 280,414 |  |  | 121,045 |  | 1990
|QUEENSBURY, NY       |  |                                                                         | 215,255 |                                                       |  | 65,245                                             |  |                           | 140,255 |                                                             |  | 140,245 |  |  | 280,500 |  |  | 134,653 |  | 1986
|BRYN MAWR, PA        |  |                                                                         | 221,000 |                                                       |  | 59,832                                             |  |                           | 143,900 |                                                             |  | 136,932 |  |  | 280,832 |  |  | 89,510  |  | 1985
|TERRYVILLE, CT       |  |                                                                         | 182,308 |                                                       |  | 98,911                                             |  |                           | 74,000  |                                                             |  | 207,219 |  |  | 281,219 |  |  | 207,051 |  | 1982
|NEW CITY, NY         |  |                                                                         | 180,979 |                                                       |  | 100,597                                            |  |                           | 109,025 |                                                             |  | 172,551 |  |  | 281,576 |  |  | 171,798 |  | 1978
|MALTA, NY            |  |                                                                         | 190,000 |                                                       |  | 91,726                                             |  |                           | 65,000  |                                                             |  | 216,726 |  |  | 281,726 |  |  | 209,422 |  | 1986
|BRONX, NY            |  |                                                                         | 88,865  |                                                       |  | 193,679                                            |  |                           | 63,315  |                                                             |  | 219,229 |  |  | 282,544 |  |  | 217,432 |  | 1976
|BRONX, NY            |  |                                                                         | 141,322 |                                                       |  | 141,909                                            |  |                           | 86,800  |                                                             |  | 196,431 |  |  | 283,231 |  |  | 186,116 |  | 1972
|PARADISE, PA         |  |                                                                         | 132,295 |                                                       |  | 151,188                                            |  |                           | 102,295 |                                                             |  | 181,188 |  |  | 283,483 |  |  | 140,177 |  | 1986
|RONKONKOMA, NY       |  |                                                                         | 76,478  |                                                       |  | 208,121                                            |  |                           | 46,057  |                                                             |  | 238,542 |  |  | 284,599 |  |  | 233,393 |  | 1978
|TROY, NY             |  |                                                                         | 225,000 |                                                       |  | 60,569                                             |  |                           | 146,500 |                                                             |  | 139,069 |  |  | 285,569 |  |  | 85,229  |  | 1985
|ELLENVILLE, NY       |  |                                                                         | 233,000 |                                                       |  | 53,690                                             |  |                           | 151,700 |                                                             |  | 134,990 |  |  | 286,690 |  |  | 85,391  |  | 1985
|SOUTH HADLEY, MA     |  |                                                                         | 232,445 |                                                       |  | 54,351                                             |  |                           | 90,000  |                                                             |  | 196,796 |  |  | 286,796 |  |  | 191,723 |  | 1982
|WESTBROOK, ME        |  |                                                                         | 93,345  |                                                       |  | 193,654                                            |  |                           | 50,431  |                                                             |  | 236,568 |  |  | 286,999 |  |  | 192,936 |  | 1986
|WORCESTER, MA        |  |                                                                         | 146,832 |                                                       |  | 140,589                                            |  |                           | 95,441  |                                                             |  | 191,980 |  |  | 287,421 |  |  | 115,861 |  | 1991
|WARWICK, RI          |  |                                                                         | 253,100 |                                                       |  | 34,400                                             |  |                           | 164,800 |                                                             |  | 122,700 |  |  | 287,500 |  |  | 70,531  |  | 1985
|WORCESTER, MA        |  |                                                                         | 275,866 |                                                       |  | 11,674                                             |  |                           | 179,313 |                                                             |  | 108,227 |  |  | 287,540 |  |  | 33,559  |  | 1992
|UNION, NJ            |  |                                                                         | 287,800 |                                                       |  | 0                                                  |  |                           | 287,800 |                                                             |  | 0       |  |  | 287,800 |  |  | 0       |  | 1985
|RICHMOND, VA         |  |                                                                         | 120,818 |                                                       |  | 167,895                                            |  |                           | 0       |                                                             |  | 288,713 |  |  | 288,713 |  |  | 264,641 |  | 1990
|HAVERTOWN, PA        |  |                                                                         | 265,200 |                                                       |  | 24,500                                             |  |                           | 172,700 |                                                             |  | 117,000 |  |  | 289,700 |  |  | 62,451  |  | 1985
|FORT EDWARD, NY      |  |                                                                         | 225,000 |                                                       |  | 65,739                                             |  |                           | 150,000 |                                                             |  | 140,739 |  |  | 290,739 |  |  | 137,351 |  | 1986
|GRANBY, MA           |  |                                                                         | 58,804  |                                                       |  | 232,477                                            |  |                           | 24,000  |                                                             |  | 267,281 |  |  | 291,281 |  |  | 204,923 |  | 1982

73

---



|                     |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|-------------------- |  | ----------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | -------------------------------------------------- |  | ------------------------- | ------- | ----------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                     |  | Initial
 Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount
 at Which Carried
 at Close of Period |  | Accumulated
 Depreciation |         | Date of
 Initial
 Leasehold or
 Acquisition
 Investment (1)
|                     |  |                                                                         |         |                                                       |  |                                                   
|Description          |  |                                                                         |         | Land                                                  |  | Building
 and
 Improvements                        |  | Total                     |         |                                                            
|                     |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|                     |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|ELKINS PARK, PA      |  |                                                                         | 275,171 |                                                       |  | 17,524                                             |  |                           | 200,000 |                                                             |  | 92,695  |  |  | 292,695 |  |  | 91,156  |  | 1990
|BRONX, NY            |  |                                                                         | 0       |                                                       |  | 293,507                                            |  |                           | 0       |                                                             |  | 293,507 |  |  | 293,507 |  |  | 293,507 |  | 1972
|KING GEORGE, VA      |  |                                                                         | 0       |                                                       |  | 293,638                                            |  |                           | 293,638 |                                                             |  | 0       |  |  | 293,638 |  |  | 0       |  | 2005
|BALLSTON, NY         |  |                                                                         | 160,000 |                                                       |  | 134,021                                            |  |                           | 110,000 |                                                             |  | 184,021 |  |  | 294,021 |  |  | 180,833 |  | 1986
|HAMBURG, NY          |  |                                                                         | 294,031 |                                                       |  | 0                                                  |  |                           | 163,906 |                                                             |  | 130,125 |  |  | 294,031 |  |  | 49,013  |  | 2000
|IPSWICH, MA          |  |                                                                         | 275,000 |                                                       |  | 19,161                                             |  |                           | 150,000 |                                                             |  | 144,161 |  |  | 294,161 |  |  | 142,410 |  | 1986
|ALBANY, NY           |  |                                                                         | 206,620 |                                                       |  | 87,949                                             |  |                           | 81,620  |                                                             |  | 212,949 |  |  | 294,569 |  |  | 206,450 |  | 1986
|NEW YORK, NY         |  |                                                                         | 125,923 |                                                       |  | 168,772                                            |  |                           | 78,125  |                                                             |  | 216,570 |  |  | 294,695 |  |  | 213,843 |  | 1972
|HAMBURG, PA          |  |                                                                         | 219,280 |                                                       |  | 75,745                                             |  |                           | 130,423 |                                                             |  | 164,602 |  |  | 295,025 |  |  | 154,329 |  | 1989
|WEST DEPTFORD, NJ    |  |                                                                         | 245,450 |                                                       |  | 50,295                                             |  |                           | 151,053 |                                                             |  | 144,692 |  |  | 295,745 |  |  | 142,590 |  | 1987
|BALDWIN, NY          |  |                                                                         | 290,923 |                                                       |  | 5,007                                              |  |                           | 151,280 |                                                             |  | 144,650 |  |  | 295,930 |  |  | 62,219  |  | 1986
|NORRISTOWN, PA       |  |                                                                         | 175,300 |                                                       |  | 120,786                                            |  |                           | 175,300 |                                                             |  | 120,786 |  |  | 296,086 |  |  | 66,625  |  | 1985
|KERNERSVILLE, NC     |  |                                                                         | 296,770 |                                                       |  | 0                                                  |  |                           | 72,777  |                                                             |  | 223,994 |  |  | 296,770 |  |  | 20,060  |  | 2007
|STATEN ISLAND, NY    |  |                                                                         | 40,598  |                                                       |  | 256,262                                            |  |                           | 26,050  |                                                             |  | 270,810 |  |  | 296,860 |  |  | 201,194 |  | 1973
|PISCATAWAY, NJ       |  |                                                                         | 269,200 |                                                       |  | 28,232                                             |  |                           | 175,300 |                                                             |  | 122,132 |  |  | 297,432 |  |  | 68,358  |  | 1985
|ROANOKE, VA          |  |                                                                         | 91,281  |                                                       |  | 206,221                                            |  |                           | 0       |                                                             |  | 297,502 |  |  | 297,502 |  |  | 229,390 |  | 1990
|MANCHESTER, NH       |  |                                                                         | 261,100 |                                                       |  | 36,404                                             |  |                           | 170,000 |                                                             |  | 127,504 |  |  | 297,504 |  |  | 68,448  |  | 1985
|ORLEANS, MA          |  |                                                                         | 260,000 |                                                       |  | 37,637                                             |  |                           | 185,000 |                                                             |  | 112,637 |  |  | 297,637 |  |  | 108,503 |  | 1986
|MILLERTON, NY        |  |                                                                         | 175,000 |                                                       |  | 123,063                                            |  |                           | 100,000 |                                                             |  | 198,063 |  |  | 298,063 |  |  | 185,327 |  | 1986
|ROTTERDAM, NY        |  |                                                                         | 132,287 |                                                       |  | 166,077                                            |  |                           | 0       |                                                             |  | 298,364 |  |  | 298,364 |  |  | 246,286 |  | 1995
|STRATFORD, CT        |  |                                                                         | 285,200 |                                                       |  | 14,728                                             |  |                           | 185,700 |                                                             |  | 114,228 |  |  | 299,928 |  |  | 57,536  |  | 1985
|SALEM, MA            |  |                                                                         | 275,000 |                                                       |  | 25,393                                             |  |                           | 175,000 |                                                             |  | 125,393 |  |  | 300,393 |  |  | 123,970 |  | 1986
|MCCONNELLSBURG, PA   |  |                                                                         | 155,367 |                                                       |  | 145,616                                            |  |                           | 69,915  |                                                             |  | 231,068 |  |  | 300,983 |  |  | 132,501 |  | 1989
|EPPING, NH           |  |                                                                         | 170,000 |                                                       |  | 131,403                                            |  |                           | 120,000 |                                                             |  | 181,403 |  |  | 301,403 |  |  | 162,869 |  | 1986
|STATEN ISLAND, NY    |  |                                                                         | 0       |                                                       |  | 301,713                                            |  |                           | 0       |                                                             |  | 301,713 |  |  | 301,713 |  |  | 233,997 |  | 1978
|OXFORD, MA           |  |                                                                         | 293,664 |                                                       |  | 9,098                                              |  |                           | 190,882 |                                                             |  | 111,880 |  |  | 302,762 |  |  | 32,247  |  | 1993
|ORANGE, NJ           |  |                                                                         | 281,200 |                                                       |  | 24,573                                             |  |                           | 183,100 |                                                             |  | 122,673 |  |  | 305,773 |  |  | 66,891  |  | 1985
|DEPTFORD, NJ         |  |                                                                         | 281,200 |                                                       |  | 24,745                                             |  |                           | 183,100 |                                                             |  | 122,845 |  |  | 305,945 |  |  | 66,308  |  | 1985
|STATEN ISLAND, NY    |  |                                                                         | 173,667 |                                                       |  | 133,198                                            |  |                           | 113,369 |                                                             |  | 193,496 |  |  | 306,865 |  |  | 179,987 |  | 1976
|CASTILE, NY          |  |                                                                         | 307,196 |                                                       |  | 0                                                  |  |                           | 132,196 |                                                             |  | 175,000 |  |  | 307,196 |  |  | 19,833  |  | 2006
|JAMAICA, NY          |  |                                                                         | 12,000  |                                                       |  | 295,750                                            |  |                           | 12,000  |                                                             |  | 295,750 |  |  | 307,750 |  |  | 205,240 |  | 1970
|CLIFTON, NJ          |  |                                                                         | 301,518 |                                                       |  | 6,413                                              |  |                           | 150,000 |                                                             |  | 157,931 |  |  | 307,931 |  |  | 105,862 |  | 1987
|BRONX, NY            |  |                                                                         | 0       |                                                       |  | 309,235                                            |  |                           | 176,558 |                                                             |  | 132,677 |  |  | 309,235 |  |  | 71,647  |  | 1971
|OXFORD, PA           |  |                                                                         | 191,449 |                                                       |  | 118,321                                            |  |                           | 65,212  |                                                             |  | 244,558 |  |  | 309,770 |  |  | 217,909 |  | 1989
|SOUTHBRIDGE, MA      |  |                                                                         | 249,169 |                                                       |  | 62,205                                             |  |                           | 161,960 |                                                             |  | 149,414 |  |  | 311,374 |  |  | 80,091  |  | 1993
|BUFFALO, NY          |  |                                                                         | 312,426 |                                                       |  | 0                                                  |  |                           | 150,888 |                                                             |  | 161,538 |  |  | 312,426 |  |  | 73,384  |  | 2000
|PEMBROKE, NH         |  |                                                                         | 138,492 |                                                       |  | 174,777                                            |  |                           | 100,837 |                                                             |  | 212,432 |  |  | 313,269 |  |  | 156,678 |  | 1986
|CANDIA, NH           |  |                                                                         | 130,000 |                                                       |  | 184,004                                            |  |                           | 80,000  |                                                             |  | 234,004 |  |  | 314,004 |  |  | 229,159 |  | 1986
|N RICHLAND HILLS, TX |  |                                                                         | 314,246 |                                                       |  | 0                                                  |  |                           | 125,745 |                                                             |  | 188,501 |  |  | 314,246 |  |  | 17,806  |  | 2007
|BRONX, NY            |  |                                                                         | 130,396 |                                                       |  | 184,222                                            |  |                           | 90,396  |                                                             |  | 224,222 |  |  | 314,618 |  |  | 207,544 |  | 1972
|BALLSTON SPA, NY     |  |                                                                         | 210,000 |                                                       |  | 105,073                                            |  |                           | 100,000 |                                                             |  | 215,073 |  |  | 315,073 |  |  | 210,459 |  | 1986
|REGO PARK, NY        |  |                                                                         | 33,745  |                                                       |  | 281,380                                            |  |                           | 23,000  |                                                             |  | 292,125 |  |  | 315,125 |  |  | 236,798 |  | 1974
|PHILADELPHIA, PA     |  |                                                                         | 281,200 |                                                       |  | 34,285                                             |  |                           | 183,100 |                                                             |  | 132,385 |  |  | 315,485 |  |  | 75,319  |  | 1985
|EPSOM, NH            |  |                                                                         | 220,000 |                                                       |  | 96,022                                             |  |                           | 155,000 |                                                             |  | 161,022 |  |  | 316,022 |  |  | 145,638 |  | 1986
|TONAWANDA, NY        |  |                                                                         | 304,762 |                                                       |  | 11,493                                             |  |                           | 211,337 |                                                             |  | 104,918 |  |  | 316,255 |  |  | 39,521  |  | 2000
|RIDGEWOOD, NY        |  |                                                                         | 278,372 |                                                       |  | 38,578                                             |  |                           | 250,000 |                                                             |  | 66,950  |  |  | 316,950 |  |  | 25,068  |  | 1986
|WHITE PLAINS, NY     |  |                                                                         | 258,600 |                                                       |  | 60,120                                             |  |                           | 164,800 |                                                             |  | 153,920 |  |  | 318,720 |  |  | 94,842  |  | 1985
|NORRISTOWN, PA       |  |                                                                         | 241,300 |                                                       |  | 78,419                                             |  |                           | 157,100 |                                                             |  | 162,619 |  |  | 319,719 |  |  | 90,430  |  | 1985
|WEST TAGHKANIC, NY   |  |                                                                         | 202,750 |                                                       |  | 117,540                                            |  |                           | 121,650 |                                                             |  | 198,640 |  |  | 320,290 |  |  | 135,096 |  | 1986
|CATSKILL, NY         |  |                                                                         | 321,446 |                                                       |  | 0                                                  |  |                           | 125,000 |                                                             |  | 196,446 |  |  | 321,446 |  |  | 45,230  |  | 2004
|ADAMSTOWN, PA        |  |                                                                         | 213,424 |                                                       |  | 108,844                                            |  |                           | 100,000 |                                                             |  | 222,268 |  |  | 322,268 |  |  | 168,733 |  | 1989
|GREEN VILLAGE, NJ    |  |                                                                         | 277,900 |                                                       |  | 44,471                                             |  |                           | 127,900 |                                                             |  | 194,471 |  |  | 322,371 |  |  | 191,202 |  | 1985
|MIDDLETOWN, RI       |  |                                                                         | 306,710 |                                                       |  | 16,364                                             |  |                           | 176,710 |                                                             |  | 146,364 |  |  | 323,074 |  |  | 145,343 |  | 1987
|BROOKLYN, NY         |  |                                                                         | 74,928  |                                                       |  | 250,382                                            |  |                           | 44,957  |                                                             |  | 280,353 |  |  | 325,310 |  |  | 209,144 |  | 1978
|SOUTH YARMOUTH, MA   |  |                                                                         | 275,866 |                                                       |  | 49,961                                             |  |                           | 179,313 |                                                             |  | 146,514 |  |  | 325,827 |  |  | 65,103  |  | 1991
|FURLONG, PA          |  |                                                                         | 175,300 |                                                       |  | 151,150                                            |  |                           | 175,300 |                                                             |  | 151,150 |  |  | 326,450 |  |  | 97,131  |  | 1985
|ALDAN, PA            |  |                                                                         | 281,200 |                                                       |  | 45,539                                             |  |                           | 183,100 |                                                             |  | 143,639 |  |  | 326,739 |  |  | 84,049  |  | 1985
|YARMOUTHPORT, MA     |  |                                                                         | 300,000 |                                                       |  | 26,940                                             |  |                           | 150,000 |                                                             |  | 176,940 |  |  | 326,940 |  |  | 176,940 |  | 1986
|FITCHBURG, MA        |  |                                                                         | 311,808 |                                                       |  | 16,384                                             |  |                           | 202,675 |                                                             |  | 125,517 |  |  | 328,192 |  |  | 40,798  |  | 1991
|WESTFIELD, MA        |  |                                                                         | 289,580 |                                                       |  | 38,615                                             |  |                           | 188,400 |                                                             |  | 139,795 |  |  | 328,195 |  |  | 82,366  |  | 1985
|ROBESONIA, PA        |  |                                                                         | 225,913 |                                                       |  | 102,802                                            |  |                           | 70,000  |                                                             |  | 258,715 |  |  | 328,715 |  |  | 224,809 |  | 1989

74

---



|                      |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|--------------------- |  | ----------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | -------------------------------------------------- |  | ------------------------- | ------- | ----------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                      |  | Initial
 Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount
 at Which Carried
 at Close of Period |  | Accumulated
 Depreciation |         | Date of
 Initial
 Leasehold or
 Acquisition
 Investment (1)
|                      |  |                                                                         |         |                                                       |  |                                                   
|Description           |  |                                                                         |         | Land                                                  |  | Building
 and
 Improvements                        |  | Total                     |         |                                                            
|                      |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|                      |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|BELMONT, MA           |  |                                                                         | 301,300 |                                                       |  | 27,938                                             |  |                           | 196,200 |                                                             |  | 133,038 |  |  | 329,238 |  |  | 71,941  |  | 1985
|WORCESTER, MA         |  |                                                                         | 284,765 |                                                       |  | 45,285                                             |  |                           | 185,097 |                                                             |  | 144,953 |  |  | 330,050 |  |  | 67,168  |  | 1991
|QUEENSBURY, NY        |  |                                                                         | 225,000 |                                                       |  | 105,592                                            |  |                           | 165,000 |                                                             |  | 165,592 |  |  | 330,592 |  |  | 160,273 |  | 1986
|PITTSFIELD, MA        |  |                                                                         | 281,200 |                                                       |  | 51,100                                             |  |                           | 183,100 |                                                             |  | 149,200 |  |  | 332,300 |  |  | 121,888 |  | 1985
|BRIDGEPORT, CT        |  |                                                                         | 313,400 |                                                       |  | 20,303                                             |  |                           | 204,100 |                                                             |  | 129,603 |  |  | 333,703 |  |  | 67,230  |  | 1985
|CAIRO, NY             |  |                                                                         | 191,928 |                                                       |  | 142,895                                            |  |                           | 46,650  |                                                             |  | 288,173 |  |  | 334,823 |  |  | 279,210 |  | 1988
|METHUEN, MA           |  |                                                                         | 147,330 |                                                       |  | 188,059                                            |  |                           | 50,731  |                                                             |  | 284,658 |  |  | 335,389 |  |  | 239,946 |  | 1986
|FITCHBURG, MA         |  |                                                                         | 142,383 |                                                       |  | 194,291                                            |  |                           | 92,549  |                                                             |  | 244,125 |  |  | 336,674 |  |  | 144,755 |  | 1992
|MILFORD, CT           |  |                                                                         | 293,512 |                                                       |  | 43,846                                             |  |                           | 191,000 |                                                             |  | 146,358 |  |  | 337,358 |  |  | 85,956  |  | 1985
|BRENTWOOD, NY         |  |                                                                         | 253,058 |                                                       |  | 84,485                                             |  |                           | 125,000 |                                                             |  | 212,543 |  |  | 337,543 |  |  | 205,657 |  | 1968
|BAY SHORE, NY         |  |                                                                         | 47,685  |                                                       |  | 289,972                                            |  |                           | 0       |                                                             |  | 337,657 |  |  | 337,657 |  |  | 336,713 |  | 1969
|BRIDGEPORT, CT        |  |                                                                         | 313,400 |                                                       |  | 24,314                                             |  |                           | 204,100 |                                                             |  | 133,614 |  |  | 337,714 |  |  | 70,985  |  | 1985
|CONSHOHOCKEN, PA      |  |                                                                         | 261,100 |                                                       |  | 77,885                                             |  |                           | 170,000 |                                                             |  | 168,985 |  |  | 338,985 |  |  | 110,753 |  | 1985
|PHILADELPHIA, PA      |  |                                                                         | 289,300 |                                                       |  | 50,010                                             |  |                           | 188,400 |                                                             |  | 150,910 |  |  | 339,310 |  |  | 92,167  |  | 1985
|WEST BOYLSTON, MA     |  |                                                                         | 311,808 |                                                       |  | 28,937                                             |  |                           | 202,675 |                                                             |  | 138,070 |  |  | 340,745 |  |  | 52,841  |  | 1991
|NORTH LINDENHURST, NY |  |                                                                         | 341,530 |                                                       |  | 0                                                  |  |                           | 192,000 |                                                             |  | 149,530 |  |  | 341,530 |  |  | 62,218  |  | 1998
|LATHAM, NY            |  |                                                                         | 275,000 |                                                       |  | 68,160                                             |  |                           | 150,000 |                                                             |  | 193,160 |  |  | 343,160 |  |  | 187,787 |  | 1986
|REIFFTON, PA          |  |                                                                         | 338,250 |                                                       |  | 5,295                                              |  |                           | 43,470  |                                                             |  | 300,075 |  |  | 343,545 |  |  | 300,075 |  | 1989
|OLD BRIDGE, NJ        |  |                                                                         | 319,521 |                                                       |  | 24,445                                             |  |                           | 204,621 |                                                             |  | 139,345 |  |  | 343,966 |  |  | 74,086  |  | 1985
|WESTBROOK, CT         |  |                                                                         | 344,881 |                                                       |  | 0                                                  |  |                           | 0       |                                                             |  | 344,881 |  |  | 344,881 |  |  | 143,700 |  | 2004
|SCOTCH PLAINS, NJ     |  |                                                                         | 331,063 |                                                       |  | 14,455                                             |  |                           | 214,600 |                                                             |  | 130,918 |  |  | 345,518 |  |  | 65,909  |  | 1985
|HILLTOP, NJ           |  |                                                                         | 329,500 |                                                       |  | 16,758                                             |  |                           | 214,600 |                                                             |  | 131,658 |  |  | 346,258 |  |  | 65,932  |  | 1985
|BREWSTER, NY          |  |                                                                         | 302,564 |                                                       |  | 44,393                                             |  |                           | 142,564 |                                                             |  | 204,393 |  |  | 346,957 |  |  | 200,406 |  | 1988
|COMMACK, NY           |  |                                                                         | 321,400 |                                                       |  | 25,659                                             |  |                           | 209,300 |                                                             |  | 137,759 |  |  | 347,059 |  |  | 74,227  |  | 1985
|HATBORO, PA           |  |                                                                         | 285,200 |                                                       |  | 61,979                                             |  |                           | 185,700 |                                                             |  | 161,479 |  |  | 347,179 |  |  | 104,001 |  | 1985
|WANTAGH, NY           |  |                                                                         | 261,814 |                                                       |  | 85,758                                             |  |                           | 175,000 |                                                             |  | 172,572 |  |  | 347,572 |  |  | 124,605 |  | 1985
|BROOKLYN, NY          |  |                                                                         | 116,328 |                                                       |  | 232,254                                            |  |                           | 75,000  |                                                             |  | 273,582 |  |  | 348,582 |  |  | 197,062 |  | 1980
|BRONX, NY             |  |                                                                         | 128,419 |                                                       |  | 221,197                                            |  |                           | 100,681 |                                                             |  | 248,935 |  |  | 349,616 |  |  | 200,262 |  | 1972
|NEW BERN, NC          |  |                                                                         | 349,946 |                                                       |  | 0                                                  |  |                           | 190,389 |                                                             |  | 159,557 |  |  | 349,946 |  |  | 19,490  |  | 2007
|IRVINGTON, NJ         |  |                                                                         | 271,200 |                                                       |  | 79,011                                             |  |                           | 176,600 |                                                             |  | 173,611 |  |  | 350,211 |  |  | 116,726 |  | 1985
|MEDIA, PA             |  |                                                                         | 326,195 |                                                       |  | 24,082                                             |  |                           | 191,000 |                                                             |  | 159,277 |  |  | 350,277 |  |  | 101,463 |  | 1985
|HATBORO, PA           |  |                                                                         | 289,300 |                                                       |  | 61,371                                             |  |                           | 188,400 |                                                             |  | 162,271 |  |  | 350,671 |  |  | 103,093 |  | 1985
|PHILADELPHIA, PA      |  |                                                                         | 285,200 |                                                       |  | 65,498                                             |  |                           | 185,700 |                                                             |  | 164,998 |  |  | 350,698 |  |  | 105,438 |  | 1985
|RIDGE, NY             |  |                                                                         | 276,942 |                                                       |  | 73,821                                             |  |                           | 200,000 |                                                             |  | 150,763 |  |  | 350,763 |  |  | 125,987 |  | 1977
|GRAND ISLAND, NY      |  |                                                                         | 350,849 |                                                       |  | 0                                                  |  |                           | 247,348 |                                                             |  | 103,501 |  |  | 350,849 |  |  | 55,756  |  | 2000
|METHUEN, MA           |  |                                                                         | 300,000 |                                                       |  | 50,861                                             |  |                           | 150,000 |                                                             |  | 200,861 |  |  | 350,861 |  |  | 199,115 |  | 1986
|CINNAMINSON, NJ       |  |                                                                         | 326,501 |                                                       |  | 24,931                                             |  |                           | 176,501 |                                                             |  | 174,931 |  |  | 351,432 |  |  | 172,960 |  | 1987
|ABINGTON, PA          |  |                                                                         | 309,300 |                                                       |  | 43,696                                             |  |                           | 201,400 |                                                             |  | 151,596 |  |  | 352,996 |  |  | 88,995  |  | 1985
|BEDFORD, TX           |  |                                                                         | 353,047 |                                                       |  | 0                                                  |  |                           | 112,953 |                                                             |  | 240,094 |  |  | 353,047 |  |  | 29,199  |  | 2007
|WORCESTER, MA         |  |                                                                         | 342,608 |                                                       |  | 11,101                                             |  |                           | 222,695 |                                                             |  | 131,014 |  |  | 353,709 |  |  | 37,328  |  | 1991
|BROOKLYN, NY          |  |                                                                         | 100,000 |                                                       |  | 254,503                                            |  |                           | 66,890  |                                                             |  | 287,613 |  |  | 354,503 |  |  | 240,968 |  | 1972
|MAGNOLIA, NJ          |  |                                                                         | 329,500 |                                                       |  | 26,488                                             |  |                           | 214,600 |                                                             |  | 141,388 |  |  | 355,988 |  |  | 76,662  |  | 1985
|TUCKERTON, NJ         |  |                                                                         | 224,387 |                                                       |  | 132,864                                            |  |                           | 131,018 |                                                             |  | 226,233 |  |  | 357,251 |  |  | 222,358 |  | 1987
|MERRIMACK, NH         |  |                                                                         | 151,993 |                                                       |  | 205,823                                            |  |                           | 100,598 |                                                             |  | 257,218 |  |  | 357,816 |  |  | 198,323 |  | 1986
|HYDE PARK, NY         |  |                                                                         | 300,000 |                                                       |  | 59,198                                             |  |                           | 175,000 |                                                             |  | 184,198 |  |  | 359,198 |  |  | 180,659 |  | 1986
|WILMINGTON, DE        |  |                                                                         | 337,500 |                                                       |  | 21,971                                             |  |                           | 219,800 |                                                             |  | 139,671 |  |  | 359,471 |  |  | 72,609  |  | 1985
|EAST PROVIDENCE, RI   |  |                                                                         | 309,950 |                                                       |  | 49,546                                             |  |                           | 202,050 |                                                             |  | 157,446 |  |  | 359,496 |  |  | 93,763  |  | 1985
|SCARSDALE, NY         |  |                                                                         | 257,100 |                                                       |  | 102,632                                            |  |                           | 167,400 |                                                             |  | 192,332 |  |  | 359,732 |  |  | 125,659 |  | 1985
|BRISTOL, CT           |  |                                                                         | 359,906 |                                                       |  | 0                                                  |  |                           | 0       |                                                             |  | 359,906 |  |  | 359,906 |  |  | 149,963 |  | 2004
|BAYONNE, NJ           |  |                                                                         | 341,500 |                                                       |  | 18,947                                             |  |                           | 222,400 |                                                             |  | 138,047 |  |  | 360,447 |  |  | 70,535  |  | 1985
|WINDSOR LOCKS, CT     |  |                                                                         | 360,664 |                                                       |  | 0                                                  |  |                           | 0       |                                                             |  | 360,664 |  |  | 360,664 |  |  | 60,113  |  | 2004
|BROOKLYN, NY          |  |                                                                         | 237,100 |                                                       |  | 125,067                                            |  |                           | 154,400 |                                                             |  | 207,767 |  |  | 362,167 |  |  | 125,486 |  | 1985
|BRIDGEPORT, CT        |  |                                                                         | 346,442 |                                                       |  | 16,990                                             |  |                           | 230,000 |                                                             |  | 133,432 |  |  | 363,432 |  |  | 131,730 |  | 1985
|LEOLA, PA             |  |                                                                         | 262,890 |                                                       |  | 102,007                                            |  |                           | 131,189 |                                                             |  | 233,708 |  |  | 364,897 |  |  | 105,602 |  | 1989
|BRISTOL, CT           |  |                                                                         | 365,028 |                                                       |  | 0                                                  |  |                           | 237,268 |                                                             |  | 127,760 |  |  | 365,028 |  |  | 21,292  |  | 2004
|BROOKLYN, NY          |  |                                                                         | 0       |                                                       |  | 365,767                                            |  |                           | 0       |                                                             |  | 365,767 |  |  | 365,767 |  |  | 337,789 |  | 1970
|BRIDGEPORT, CT        |  |                                                                         | 338,415 |                                                       |  | 27,786                                             |  |                           | 219,800 |                                                             |  | 146,401 |  |  | 366,201 |  |  | 77,714  |  | 1985
|HOLYOKE, MA           |  |                                                                         | 329,500 |                                                       |  | 38,345                                             |  |                           | 214,600 |                                                             |  | 153,245 |  |  | 367,845 |  |  | 145,091 |  | 1985
|PORTLAND, ME          |  |                                                                         | 325,400 |                                                       |  | 42,652                                             |  |                           | 211,900 |                                                             |  | 156,152 |  |  | 368,052 |  |  | 82,597  |  | 1985
|BRONX, NY             |  |                                                                         | 69,150  |                                                       |  | 300,279                                            |  |                           | 34,150  |                                                             |  | 335,279 |  |  | 369,429 |  |  | 256,816 |  | 1972

75

---



|                   |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|------------------ |  | ----------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | -------------------------------------------------- |  | ------------------------- | ------- | ----------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                   |  | Initial
 Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount
 at Which Carried
 at Close of Period |  | Accumulated
 Depreciation |         | Date of
 Initial
 Leasehold or
 Acquisition
 Investment (1)
|                   |  |                                                                         |         |                                                       |  |                                                   
|Description        |  |                                                                         |         | Land                                                  |  | Building
 and
 Improvements                        |  | Total                     |         |                                                            
|                   |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|                   |  |                                                                         |         |                                                       |  |                                                    |  |                           |         |                                                             |  |         |  |  |         |  |  |         |  |     
|PLAINVILLE, CT     |  |                                                                         | 80,000  |                                                       |  | 290,433                                            |  |                           | 0       |                                                             |  | 370,433 |  |  | 370,433 |  |  | 322,526 |  | 1983
|CHERRY HILL, NJ    |  |                                                                         | 357,500 |                                                       |  | 13,879                                             |  |                           | 232,800 |                                                             |  | 138,579 |  |  | 371,379 |  |  | 67,609  |  | 1985
|CRANFORD, NJ       |  |                                                                         | 342,666 |                                                       |  | 29,222                                             |  |                           | 222,400 |                                                             |  | 149,488 |  |  | 371,888 |  |  | 81,200  |  | 1985
|STRATFORD, CT      |  |                                                                         | 301,300 |                                                       |  | 70,735                                             |  |                           | 196,200 |                                                             |  | 175,835 |  |  | 372,035 |  |  | 112,470 |  | 1985
|LEOMINSTER, MA     |  |                                                                         | 195,776 |                                                       |  | 177,454                                            |  |                           | 127,254 |                                                             |  | 245,976 |  |  | 373,230 |  |  | 149,460 |  | 1991
|MOHNTON, PA        |  |                                                                         | 317,228 |                                                       |  | 56,374                                             |  |                           | 66,425  |                                                             |  | 307,177 |  |  | 373,602 |  |  | 291,371 |  | 1989
|PAWTUCKET, RI      |  |                                                                         | 212,775 |                                                       |  | 161,188                                            |  |                           | 118,860 |                                                             |  | 255,103 |  |  | 373,963 |  |  | 226,580 |  | 1986
|HINGHAM, MA        |  |                                                                         | 352,606 |                                                       |  | 22,484                                             |  |                           | 242,520 |                                                             |  | 132,570 |  |  | 375,090 |  |  | 130,995 |  | 1989
|MINEOLA, NY        |  |                                                                         | 341,500 |                                                       |  | 34,411                                             |  |                           | 222,400 |                                                             |  | 153,511 |  |  | 375,911 |  |  | 85,135  |  | 1985
|BROOKLYN, NY       |  |                                                                         | 147,795 |                                                       |  | 228,379                                            |  |                           | 103,815 |                                                             |  | 272,359 |  |  | 376,174 |  |  | 233,292 |  | 1972
|STATEN ISLAND, NY  |  |                                                                         | 25,000  |                                                       |  | 351,829                                            |  |                           | 0       |                                                             |  | 376,829 |  |  | 376,829 |  |  | 302,382 |  | 1972
|WILMINGTON, DE     |  |                                                                         | 309,300 |                                                       |  | 67,834                                             |  |                           | 201,400 |                                                             |  | 175,734 |  |  | 377,134 |  |  | 106,915 |  | 1985
|SPRINGFIELD, MA    |  |                                                                         | 139,373 |                                                       |  | 239,713                                            |  |                           | 50,000  |                                                             |  | 329,086 |  |  | 379,086 |  |  | 247,702 |  | 1983
|TRENTON, NJ        |  |                                                                         | 373,600 |                                                       |  | 9,572                                              |  |                           | 243,300 |                                                             |  | 139,872 |  |  | 383,172 |  |  | 65,722  |  | 1985
|SLEEPY HOLLOW, NY  |  |                                                                         | 280,825 |                                                       |  | 102,486                                            |  |                           | 129,744 |                                                             |  | 253,567 |  |  | 383,311 |  |  | 245,574 |  | 1969
|S. GLENS FALLS, NY |  |                                                                         | 325,000 |                                                       |  | 58,892                                             |  |                           | 188,700 |                                                             |  | 195,192 |  |  | 383,892 |  |  | 195,192 |  | 1986
|NORWALK, CT        |  |                                                                         | 257,308 |                                                       |  | 128,940                                            |  |                           | 104,000 |                                                             |  | 282,248 |  |  | 386,248 |  |  | 281,503 |  | 1982
|MASSAPEQUA, NY     |  |                                                                         | 333,400 |                                                       |  | 53,696                                             |  |                           | 217,100 |                                                             |  | 169,996 |  |  | 387,096 |  |  | 103,834 |  | 1985
|SPRING LAKE, NJ    |  |                                                                         | 345,500 |                                                       |  | 42,194                                             |  |                           | 225,000 |                                                             |  | 162,694 |  |  | 387,694 |  |  | 90,468  |  | 1985
|ROCHESTER, NH      |  |                                                                         | 179,717 |                                                       |  | 208,103                                            |  |                           | 100,000 |                                                             |  | 287,820 |  |  | 387,820 |  |  | 233,623 |  | 1986
|WORCESTER, MA      |  |                                                                         | 231,372 |                                                       |  | 157,356                                            |  |                           | 150,392 |                                                             |  | 238,336 |  |  | 388,728 |  |  | 138,067 |  | 1991
|OZONE PARK, NY     |  |                                                                         | 57,289  |                                                       |  | 331,799                                            |  |                           | 44,715  |                                                             |  | 344,373 |  |  | 389,088 |  |  | 289,034 |  | 1976
|NEW ROCHELLE, NY   |  |                                                                         | 337,500 |                                                       |  | 51,741                                             |  |                           | 219,800 |                                                             |  | 169,441 |  |  | 389,241 |  |  | 96,058  |  | 1985
|NEW BRITAIN, CT    |  |                                                                         | 390,497 |                                                       |  | 0                                                  |  |                           | 253,823 |                                                             |  | 136,674 |  |  | 390,497 |  |  | 22,779  |  | 2004
|WALL TOWNSHIP, NJ  |  |                                                                         | 336,441 |                                                       |  | 55,709                                             |  |                           | 121,441 |                                                             |  | 270,709 |  |  | 392,150 |  |  | 266,566 |  | 1986
|BRONX, NY          |  |                                                                         | 70,132  |                                                       |  | 322,265                                            |  |                           | 30,132  |                                                             |  | 362,265 |  |  | 392,397 |  |  | 272,357 |  | 1972
|LANCASTER, PA      |  |                                                                         | 308,964 |                                                       |  | 83,443                                             |  |                           | 104,338 |                                                             |  | 288,069 |  |  | 392,407 |  |  | 271,636 |  | 1989
|FRIENDSHIP, NY     |  |                                                                         | 392,517 |                                                       |  | 0                                                  |  |                           | 42,517  |                                                             |  | 350,000 |  |  | 392,517 |  |  | 39,667  |  | 2006
|SAUGERTIES, NY     |  |                                                                         | 328,668 |                                                       |  | 63,983                                             |  |                           | 328,668 |                                                             |  | 63,983  |  |  | 392,651 |  |  | 60,624  |  | 1988
|INTERCOURSE, PA    |  |                                                                         | 311,503 |                                                       |  | 81,287                                             |  |                           | 157,801 |                                                             |  | 234,989 |  |  | 392,790 |  |  | 100,787 |  | 1989
|SOUTH AMBOY, NJ    |  |                                                                         | 299,678 |                                                       |  | 94,088                                             |  |                           | 178,950 |                                                             |  | 214,816 |  |  | 393,766 |  |  | 213,268 |  | 1978
|BASKING RIDGE, NJ  |  |                                                                         | 362,172 |                                                       |  | 32,960                                             |  |                           | 200,000 |                                                             |  | 195,132 |  |  | 395,132 |  |  | 131,994 |  | 1986
|GARDEN CITY, NY    |  |                                                                         | 361,600 |                                                       |  | 33,774                                             |  |                           | 235,500 |                                                             |  | 159,874 |  |  | 395,374 |  |  | 87,489  |  | 1985
|WOBURN, MA         |  |                                                                         | 350,000 |                                                       |  | 45,681                                             |  |                           | 200,000 |                                                             |  | 195,681 |  |  | 395,681 |  |  | 193,825 |  | 1986
|COBALT, CT         |  |                                                                         | 395,683 |                                                       |  | 0                                                  |  |                           | 0       |                                                             |  | 395,683 |  |  | 395,683 |  |  | 164,867 |  | 2004
|AUBURN, MA         |  |                                                                         | 369,306 |                                                       |  | 27,792                                             |  |                           | 240,049 |                                                             |  | 157,049 |  |  | 397,098 |  |  | 54,077  |  | 1991
|STATEN ISLAND, NY  |  |                                                                         | 357,904 |                                                       |  | 39,588                                             |  |                           | 230,300 |                                                             |  | 167,192 |  |  | 397,492 |  |  | 95,569  |  | 1985
|FLUSHING, NY       |  |                                                                         | 118,309 |                                                       |  | 280,435                                            |  |                           | 78,309  |                                                             |  | 320,435 |  |  | 398,744 |  |  | 232,913 |  | 1973
|OCEANSIDE, NY      |  |                                                                         | 313,400 |                                                       |  | 88,863                                             |  |                           | 204,100 |                                                             |  | 198,163 |  |  | 402,263 |  |  | 102,139 |  | 1985
|BELLAIRE, NY       |  |                                                                         | 329,500 |                                                       |  | 73,358                                             |  |                           | 214,600 |                                                             |  | 188,258 |  |  | 402,858 |  |  | 111,531 |  | 1985
|CATSKILL, NY       |  |                                                                         | 404,988 |                                                       |  | 0                                                  |  |                           | 354,365 |                                                             |  | 50,623  |  |  | 404,988 |  |  | 4,050   |  | 2007
|NORTH HAVEN, CT    |  |                                                                         | 405,389 |                                                       |  | 0                                                  |  |                           | 251,985 |                                                             |  | 153,404 |  |  | 405,389 |  |  | 32,459  |  | 2004
|BRIDGEPORT, CT     |  |                                                                         | 349,500 |                                                       |  | 56,209                                             |  |                           | 227,600 |                                                             |  | 178,109 |  |  | 405,709 |  |  | 107,742 |  | 1985
|WORCESTER, MA      |  |                                                                         | 385,600 |                                                       |  | 21,339                                             |  |                           | 251,100 |                                                             |  | 155,839 |  |  | 406,939 |  |  | 79,050  |  | 1985
|TRENTON, NJ        |  |                                                                         | 337,500 |                                                       |  | 69,461                                             |  |                           | 219,800 |                                                             |  | 187,161 |  |  | 406,961 |  |  | 120,564 |  | 1985
|WILMINGTON, DE     |  |                                                                         | 369,600 |                                                       |  | 38,077                                             |  |                           | 240,700 |                                                             |  | 166,977 |  |  | 407,677 |  |  | 93,054  |  | 1985
|BRONX, NY          |  |                                                                         | 118,025 |                                                       |  | 290,298                                            |  |                           | 73,025  |                                                             |  | 335,298 |  |  | 408,323 |  |  | 282,534 |  | 1972
|SEAFORD, NY        |  |                                                                         | 325,400 |                                                       |  | 83,257                                             |  |                           | 211,900 |                                                             |  | 196,757 |  |  | 408,657 |  |  | 99,029  |  | 1985
|WATERTOWN, CT      |  |                                                                         | 351,771 |                                                       |  | 58,812                                             |  |                           | 204,027 |                                                             |  | 206,556 |  |  | 410,583 |  |  | 109,570 |  | 1992
|MORRISVILLE, PA    |  |                                                                         | 377,600 |                                                       |  | 33,522                                             |  |                           | 245,900 |                                                             |  | 165,222 |  |  | 411,122 |  |  | 90,191  |  | 1985
|GLENDALE, NY       |  |                                                                         | 124,438 |                                                       |  | 287,907                                            |  |                           | 86,160  |                                                             |  | 326,185 |  |  | 412,345 |  |  | 270,940 |  | 1976
|JERICHO, NY        |  |                                                                         | 0       |                                                       |  | 412,536                                            |  |                           | 0       |                                                             |  | 412,536 |  |  | 412,536 |  |  | 270,549 |  | 1998
|BRONX, NY          |  |                                                                         | 60,000  |                                                       |  | 353,955                                            |  |                           | 60,800  |                                                             |  | 353,155 |  |  | 413,955 |  |  | 277,239 |  | 1965
|CORONA, NY         |  |                                                                         | 114,247 |                                                       |  | 300,172                                            |  |                           | 112,800 |                                                             |  | 301,619 |  |  | 414,419 |  |  | 215,843 |  | 1965
|NEW ROCHELLE, NY   |  |                                                                         | 415,180 |                                                       |  | 0                                                  |  |                           | 251,875 |                                                             |  | 163,305 |  |  | 415,180 |  |  | 67,712  |  | 1998
|WARWICK, RI        |  |                                                                         | 376,563 |                                                       |  | 39,933                                             |  |                           | 205,889 |                                                             |  | 210,607 |  |  | 416,496 |  |  | 208,671 |  | 1989
|ST. ALBANS, NY     |  |                                                                         | 329,500 |                                                       |  | 87,250                                             |  |                           | 214,600 |                                                             |  | 202,150 |  |  | 416,750 |  |  | 128,829 |  | 1985
|NASHUA, NH         |  |                                                                         | 197,142 |                                                       |  | 219,639                                            |  |                           | 155,837 |                                                             |  | 260,944 |  |  | 416,781 |  |  | 198,380 |  | 1986
|WILMINGTON, DE     |  |                                                                         | 313,400 |                                                       |  | 103,748                                            |  |                           | 204,100 |                                                             |  | 213,048 |  |  | 417,148 |  |  | 138,441 |  | 1985
|HAVERHILL, MA      |  |                                                                         | 400,000 |                                                       |  | 17,182                                             |  |                           | 225,000 |                                                             |  | 192,182 |  |  | 417,182 |  |  | 191,937 |  | 1986
|PHILADELPHIA,
 PA  |  |                                                                         | 389,700 |                                                       |  | 28,006                                             |  |                           | 253,800 |                                                             |  | 163,906 |  |  | 417,706 |  |  | 87,019  |  | 1985

76

---



|                      |  |                                                                        |         |                                                       |  |                                                   |  |       |         |                                                            |  |         |  |  |         |  |  |         |  |     
|--------------------- |  | ---------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | ------------------------------------------------- |  | ----- | ------- | ---------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                      |  | Initial Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount at Which Carried
 at Close of Period |  |       |         | Date of Initial
 Leasehold or
 Acquisition
 Investment (1)
|                      |  |                                                                        |         |                                                       |  |                                                   | 
|Description           |  |                                                                        |         | Land                                                  |  | Building and
 Improvements                        |  | Total |         | Accumulated
 Depreciation                                  | 
|                      |  |                                                                        |         |                                                       |  |                                                   |  |       |         |                                                            |  |         |  |  |         |  |  |         |  |     
|                     
|BERGENFIELD, NJ       |  |                                                                        | 381,590 |                                                       |  | 36,271                                            |  |       | 300,000 |                                                            |  | 117,861 |  |  | 417,861 |  |  | 114,909 |  | 1990
|PLAISTOW, NH          |  |                                                                        | 300,406 |                                                       |  | 117,924                                           |  |       | 244,694 |                                                            |  | 173,636 |  |  | 418,330 |  |  | 163,605 |  | 1987
|BELMONT, MA           |  |                                                                        | 389,700 |                                                       |  | 28,871                                            |  |       | 253,800 |                                                            |  | 164,771 |  |  | 418,571 |  |  | 87,317  |  | 1985
|NEW HOLLAND, PA       |  |                                                                        | 313,015 |                                                       |  | 106,839                                           |  |       | 143,465 |                                                            |  | 276,389 |  |  | 419,854 |  |  | 251,559 |  | 1989
|MADISON, NC           |  |                                                                        | 420,878 |                                                       |  | 0                                                 |  |       | 45,705  |                                                            |  | 375,174 |  |  | 420,878 |  |  | 34,864  |  | 2007
|TRAPPE, PA            |  |                                                                        | 377,600 |                                                       |  | 44,509                                            |  |       | 245,900 |                                                            |  | 176,209 |  |  | 422,109 |  |  | 101,796 |  | 1985
|FRAMINGHAM, MA        |  |                                                                        | 400,449 |                                                       |  | 22,280                                            |  |       | 260,294 |                                                            |  | 162,435 |  |  | 422,729 |  |  | 53,269  |  | 1991
|TAYLORSVILLE, NC      |  |                                                                        | 422,809 |                                                       |  | 0                                                 |  |       | 134,188 |                                                            |  | 288,621 |  |  | 422,809 |  |  | 28,316  |  | 2007
|PROVIDENCE, RI        |  |                                                                        | 231,372 |                                                       |  | 191,647                                           |  |       | 150,392 |                                                            |  | 272,627 |  |  | 423,019 |  |  | 140,229 |  | 1991
|NORTHBOROUGH, MA      |  |                                                                        | 404,900 |                                                       |  | 18,353                                            |  |       | 263,185 |                                                            |  | 160,068 |  |  | 423,253 |  |  | 48,522  |  | 1993
|MASTIC, NY            |  |                                                                        | 313,400 |                                                       |  | 110,180                                           |  |       | 204,100 |                                                            |  | 219,480 |  |  | 423,580 |  |  | 157,909 |  | 1985
|PARAMUS, NJ           |  |                                                                        | 381,700 |                                                       |  | 42,394                                            |  |       | 248,600 |                                                            |  | 175,494 |  |  | 424,094 |  |  | 100,322 |  | 1985
|HAVERTOWN, PA         |  |                                                                        | 402,000 |                                                       |  | 22,660                                            |  |       | 253,800 |                                                            |  | 170,860 |  |  | 424,660 |  |  | 94,304  |  | 1985
|ELIZABETH, NJ         |  |                                                                        | 405,800 |                                                       |  | 18,881                                            |  |       | 264,300 |                                                            |  | 160,381 |  |  | 424,681 |  |  | 79,555  |  | 1985
|BEVERLY, MA           |  |                                                                        | 275,000 |                                                       |  | 150,741                                           |  |       | 175,000 |                                                            |  | 250,741 |  |  | 425,741 |  |  | 213,799 |  | 1986
|WORCESTER, MA         |  |                                                                        | 275,866 |                                                       |  | 150,472                                           |  |       | 179,313 |                                                            |  | 247,025 |  |  | 426,338 |  |  | 135,122 |  | 1991
|GLEN HEAD, NY         |  |                                                                        | 234,395 |                                                       |  | 192,295                                           |  |       | 102,645 |                                                            |  | 324,045 |  |  | 426,690 |  |  | 324,045 |  | 1982
|MIDLOTHIAN, TX        |  |                                                                        | 429,142 |                                                       |  | 0                                                 |  |       | 71,970  |                                                            |  | 357,172 |  |  | 429,142 |  |  | 37,101  |  | 2007
|HUDSON, NY            |  |                                                                        | 303,741 |                                                       |  | 126,379                                           |  |       | 151,871 |                                                            |  | 278,249 |  |  | 430,120 |  |  | 133,493 |  | 1989
|PHOENIXVILLE, PA      |  |                                                                        | 413,800 |                                                       |  | 17,561                                            |  |       | 269,500 |                                                            |  | 161,861 |  |  | 431,361 |  |  | 80,398  |  | 1985
|LEWISTON, ME          |  |                                                                        | 341,900 |                                                       |  | 89,500                                            |  |       | 222,400 |                                                            |  | 209,000 |  |  | 431,400 |  |  | 141,051 |  | 1985
|WYOMISSING HILLS, PA  |  |                                                                        | 319,320 |                                                       |  | 113,176                                           |  |       | 76,074  |                                                            |  | 356,422 |  |  | 432,496 |  |  | 334,171 |  | 1989
|ALLENTOWN, PA         |  |                                                                        | 357,500 |                                                       |  | 76,385                                            |  |       | 232,800 |                                                            |  | 201,085 |  |  | 433,885 |  |  | 110,532 |  | 1985
|DERRY, NH             |  |                                                                        | 417,988 |                                                       |  | 16,295                                            |  |       | 157,988 |                                                            |  | 276,295 |  |  | 434,283 |  |  | 275,733 |  | 1987
|AUDUBON, NJ           |  |                                                                        | 421,800 |                                                       |  | 12,949                                            |  |       | 274,700 |                                                            |  | 160,049 |  |  | 434,749 |  |  | 76,937  |  | 1985
|ASBURY PARK, NJ       |  |                                                                        | 418,966 |                                                       |  | 18,038                                            |  |       | 272,100 |                                                            |  | 164,904 |  |  | 437,004 |  |  | 82,827  |  | 1985
|BELLEVILLE, NJ        |  |                                                                        | 397,700 |                                                       |  | 39,410                                            |  |       | 259,000 |                                                            |  | 178,110 |  |  | 437,110 |  |  | 98,955  |  | 1985
|BLACKWOOD, NJ         |  |                                                                        | 401,700 |                                                       |  | 36,736                                            |  |       | 261,600 |                                                            |  | 176,836 |  |  | 438,436 |  |  | 97,885  |  | 1985
|DOYLESTOWN, PA        |  |                                                                        | 405,800 |                                                       |  | 32,659                                            |  |       | 264,300 |                                                            |  | 174,159 |  |  | 438,459 |  |  | 93,290  |  | 1985
|NEWARK, DE            |  |                                                                        | 405,800 |                                                       |  | 35,844                                            |  |       | 264,300 |                                                            |  | 177,344 |  |  | 441,644 |  |  | 96,555  |  | 1985
|GLENVILLE, NY         |  |                                                                        | 343,723 |                                                       |  | 98,299                                            |  |       | 219,800 |                                                            |  | 222,222 |  |  | 442,022 |  |  | 144,438 |  | 1985
|PHILADELPHIA, PA      |  |                                                                        | 237,100 |                                                       |  | 205,495                                           |  |       | 154,400 |                                                            |  | 288,195 |  |  | 442,595 |  |  | 182,411 |  | 1985
|WORCESTER, MA         |  |                                                                        | 167,745 |                                                       |  | 275,852                                           |  |       | 167,745 |                                                            |  | 275,852 |  |  | 443,597 |  |  | 156,796 |  | 1991
|FAIRFIELD, CT         |  |                                                                        | 430,000 |                                                       |  | 13,631                                            |  |       | 280,000 |                                                            |  | 163,631 |  |  | 443,631 |  |  | 77,554  |  | 1985
|WEST CHESTER, PA      |  |                                                                        | 421,800 |                                                       |  | 21,935                                            |  |       | 274,700 |                                                            |  | 169,035 |  |  | 443,735 |  |  | 85,817  |  | 1985
|REVERE, MA            |  |                                                                        | 250,000 |                                                       |  | 193,854                                           |  |       | 150,000 |                                                            |  | 293,854 |  |  | 443,854 |  |  | 249,800 |  | 1986
|BRONX, NY             |  |                                                                        | 128,049 |                                                       |  | 315,917                                           |  |       | 83,849  |                                                            |  | 360,117 |  |  | 443,966 |  |  | 263,315 |  | 1972
|LANSDALE, PA          |  |                                                                        | 243,844 |                                                       |  | 200,458                                           |  |       | 243,844 |                                                            |  | 200,458 |  |  | 444,302 |  |  | 117,725 |  | 1985
|DUDLEY, MA            |  |                                                                        | 302,563 |                                                       |  | 141,993                                           |  |       | 196,666 |                                                            |  | 247,890 |  |  | 444,556 |  |  | 111,855 |  | 1991
|METHUEN, MA           |  |                                                                        | 379,664 |                                                       |  | 64,941                                            |  |       | 245,900 |                                                            |  | 198,705 |  |  | 444,605 |  |  | 122,989 |  | 1985
|LOWELL, MA            |  |                                                                        | 360,949 |                                                       |  | 83,674                                            |  |       | 200,949 |                                                            |  | 243,674 |  |  | 444,623 |  |  | 243,406 |  | 1985
|JERSEY CITY, NJ       |  |                                                                        | 401,700 |                                                       |  | 43,808                                            |  |       | 261,600 |                                                            |  | 183,908 |  |  | 445,508 |  |  | 104,788 |  | 1985
|WETHERSFIELD, CT      |  |                                                                        | 446,610 |                                                       |  | 0                                                 |  |       | 0       |                                                            |  | 446,610 |  |  | 446,610 |  |  | 186,088 |  | 2004
|BAYSIDE, NY           |  |                                                                        | 245,100 |                                                       |  | 202,833                                           |  |       | 159,600 |                                                            |  | 288,333 |  |  | 447,933 |  |  | 186,278 |  | 1985
|RIDGEFIELD, CT        |  |                                                                        | 401,630 |                                                       |  | 47,610                                            |  |       | 166,861 |                                                            |  | 282,379 |  |  | 449,240 |  |  | 276,351 |  | 1985
|SHARON HILL, PA       |  |                                                                        | 411,057 |                                                       |  | 39,574                                            |  |       | 266,800 |                                                            |  | 183,831 |  |  | 450,631 |  |  | 102,910 |  | 1985
|ELMONT, NY            |  |                                                                        | 360,056 |                                                       |  | 90,633                                            |  |       | 224,156 |                                                            |  | 226,533 |  |  | 450,689 |  |  | 115,598 |  | 1985
|WHITING, NJ           |  |                                                                        | 447,199 |                                                       |  | 3,519                                             |  |       | 167,090 |                                                            |  | 283,628 |  |  | 450,718 |  |  | 282,841 |  | 1989
|PORT JEFFERSON, NY    |  |                                                                        | 387,478 |                                                       |  | 63,743                                            |  |       | 245,753 |                                                            |  | 205,468 |  |  | 451,221 |  |  | 124,739 |  | 1985
|UPTON, MA             |  |                                                                        | 428,498 |                                                       |  | 24,611                                            |  |       | 278,524 |                                                            |  | 174,585 |  |  | 453,109 |  |  | 57,819  |  | 1991
|WYANDANCH, NY         |  |                                                                        | 453,131 |                                                       |  | 0                                                 |  |       | 279,500 |                                                            |  | 173,631 |  |  | 453,131 |  |  | 72,197  |  | 1998
|WAKEFIELD, RI         |  |                                                                        | 413,800 |                                                       |  | 39,616                                            |  |       | 269,500 |                                                            |  | 183,916 |  |  | 453,416 |  |  | 94,885  |  | 1985
|PORTSMOUTH, NH        |  |                                                                        | 225,000 |                                                       |  | 228,704                                           |  |       | 125,000 |                                                            |  | 328,704 |  |  | 453,704 |  |  | 264,433 |  | 1986
|WORCESTER, MA         |  |                                                                        | 271,417 |                                                       |  | 183,331                                           |  |       | 176,421 |                                                            |  | 278,327 |  |  | 454,748 |  |  | 157,381 |  | 1991
|ALDAN, PA             |  |                                                                        | 433,800 |                                                       |  | 21,152                                            |  |       | 282,500 |                                                            |  | 172,452 |  |  | 454,952 |  |  | 86,068  |  | 1985
|WILLINGBORO, NJ       |  |                                                                        | 425,800 |                                                       |  | 29,928                                            |  |       | 277,300 |                                                            |  | 178,428 |  |  | 455,728 |  |  | 94,774  |  | 1985
|NEWBURGH, NY          |  |                                                                        | 430,766 |                                                       |  | 25,850                                            |  |       | 150,000 |                                                            |  | 306,616 |  |  | 456,616 |  |  | 297,464 |  | 1989
|HUNTINGDON VALLEY, PA |  |                                                                        | 421,800 |                                                       |  | 36,439                                            |  |       | 274,700 |                                                            |  | 183,539 |  |  | 458,239 |  |  | 99,269  |  | 1985
|WARWICK, RI           |  |                                                                        | 434,752 |                                                       |  | 24,730                                            |  |       | 266,800 |                                                            |  | 192,682 |  |  | 459,482 |  |  | 112,033 |  | 1985
|EAST ORANGE, NJ       |  |                                                                        | 421,508 |                                                       |  | 37,977                                            |  |       | 272,100 |                                                            |  | 187,385 |  |  | 459,485 |  |  | 104,384 |  | 1985
|NISKAYUNA, NY         |  |                                                                        | 425,000 |                                                       |  | 35,421                                            |  |       | 275,000 |                                                            |  | 185,421 |  |  | 460,421 |  |  | 180,531 |  | 1986

77

---



|                     |  |                                                                        |         |                                                       |  |                                                   |  |       |         |                                                            |  |         |  |  |         |  |  |         |  |     
|-------------------- |  | ---------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | ------------------------------------------------- |  | ----- | ------- | ---------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                     |  | Initial Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount at Which Carried
 at Close of Period |  |       |         | Date of Initial
 Leasehold or
 Acquisition
 Investment (1)
|                     |  |                                                                        |         |                                                       |  |                                                   | 
|Description          |  |                                                                        |         | Land                                                  |  | Building and
 Improvements                        |  | Total |         | Accumulated
 Depreciation                                  | 
|                     |  |                                                                        |         |                                                       |  |                                                   |  |       |         |                                                            |  |         |  | 
|                    
|EVERETT, MA          |  |                                                                        | 269,500 |                                                       |  | 190,931                                           |  |       | 269,500 |                                                            |  | 190,931 |  |  | 460,431 |  |  | 109,593 |  | 1985
|FOXBOROUGH, MA       |  |                                                                        | 426,593 |                                                       |  | 34,403                                            |  |       | 325,000 |                                                            |  | 135,996 |  |  | 460,996 |  |  | 129,994 |  | 1990
|BRIDGEPORT, CT       |  |                                                                        | 377,600 |                                                       |  | 83,549                                            |  |       | 245,900 |                                                            |  | 215,249 |  |  | 461,149 |  |  | 141,059 |  | 1985
|YONKERS, NY          |  |                                                                        | 291,348 |                                                       |  | 170,478                                           |  |       | 216,348 |                                                            |  | 245,478 |  |  | 461,826 |  |  | 225,565 |  | 1972
|AUSTIN, TX           |  |                                                                        | 462,233 |                                                       |  | 0                                                 |  |       | 274,300 |                                                            |  | 187,933 |  |  | 462,233 |  |  | 21,300  |  | 2007
|SIMSBURY, CT         |  |                                                                        | 317,704 |                                                       |  | 144,637                                           |  |       | 206,700 |                                                            |  | 255,641 |  |  | 462,341 |  |  | 186,794 |  | 1985
|BENNINGTON, VT       |  |                                                                        | 309,300 |                                                       |  | 154,480                                           |  |       | 201,400 |                                                            |  | 262,380 |  |  | 463,780 |  |  | 150,558 |  | 1985
|BRONX, NY            |  |                                                                        | 104,130 |                                                       |  | 360,410                                           |  |       | 90,000  |                                                            |  | 374,540 |  |  | 464,540 |  |  | 308,097 |  | 1985
|IRVINGTON, NJ        |  |                                                                        | 409,700 |                                                       |  | 54,841                                            |  |       | 266,800 |                                                            |  | 197,741 |  |  | 464,541 |  |  | 117,015 |  | 1985
|LEICESTER, MA        |  |                                                                        | 266,968 |                                                       |  | 197,898                                           |  |       | 173,529 |                                                            |  | 291,337 |  |  | 464,866 |  |  | 159,423 |  | 1991
|FARMINGTON, CT       |  |                                                                        | 466,271 |                                                       |  | 0                                                 |  |       | 303,076 |                                                            |  | 163,195 |  |  | 466,271 |  |  | 27,200  |  | 2004
|RUTHER GLEN, VA      |  |                                                                        | 0       |                                                       |  | 466,341                                           |  |       | 31,341  |                                                            |  | 435,000 |  |  | 466,341 |  |  | 65,250  |  | 2005
|NORTH PLAINFIELD, NJ |  |                                                                        | 227,190 |                                                       |  | 239,709                                           |  |       | 175,000 |                                                            |  | 291,899 |  |  | 466,899 |  |  | 283,378 |  | 1978
|WATERBURY, CT        |  |                                                                        | 468,469 |                                                       |  | 0                                                 |  |       | 304,505 |                                                            |  | 163,964 |  |  | 468,469 |  |  | 27,329  |  | 2004
|QUAKERTOWN, PA       |  |                                                                        | 379,111 |                                                       |  | 89,812                                            |  |       | 243,300 |                                                            |  | 225,623 |  |  | 468,923 |  |  | 146,056 |  | 1985
|WATCHUNG, NJ         |  |                                                                        | 449,900 |                                                       |  | 20,339                                            |  |       | 293,000 |                                                            |  | 177,239 |  |  | 470,239 |  |  | 87,508  |  | 1985
|BROCKTON, MA         |  |                                                                        | 275,866 |                                                       |  | 194,619                                           |  |       | 179,313 |                                                            |  | 291,172 |  |  | 470,485 |  |  | 167,439 |  | 1991
|WALPOLE, MA          |  |                                                                        | 449,900 |                                                       |  | 20,586                                            |  |       | 293,000 |                                                            |  | 177,486 |  |  | 470,486 |  |  | 85,658  |  | 1985
|POTTSVILLE, PA       |  |                                                                        | 451,360 |                                                       |  | 19,361                                            |  |       | 147,740 |                                                            |  | 322,981 |  |  | 470,721 |  |  | 316,077 |  | 1990
|PARLIN, NJ           |  |                                                                        | 441,900 |                                                       |  | 29,075                                            |  |       | 287,800 |                                                            |  | 183,175 |  |  | 470,975 |  |  | 95,855  |  | 1985
|WESTFORD, MA         |  |                                                                        | 275,000 |                                                       |  | 196,493                                           |  |       | 175,000 |                                                            |  | 296,493 |  |  | 471,493 |  |  | 240,656 |  | 1986
|CHATHAM, MA          |  |                                                                        | 275,000 |                                                       |  | 197,302                                           |  |       | 175,000 |                                                            |  | 297,302 |  |  | 472,302 |  |  | 239,173 |  | 1986
|STATEN ISLAND, NY    |  |                                                                        | 101,033 |                                                       |  | 371,591                                           |  |       | 75,650  |                                                            |  | 396,974 |  |  | 472,624 |  |  | 283,688 |  | 1972
|FALMOUTH, MA         |  |                                                                        | 150,000 |                                                       |  | 322,942                                           |  |       | 75,000  |                                                            |  | 397,942 |  |  | 472,942 |  |  | 314,094 |  | 1986
|BLOOMFIELD, NJ       |  |                                                                        | 441,900 |                                                       |  | 32,951                                            |  |       | 287,800 |                                                            |  | 187,051 |  |  | 474,851 |  |  | 99,723  |  | 1985
|STATEN ISLAND, NY    |  |                                                                        | 389,700 |                                                       |  | 88,922                                            |  |       | 253,800 |                                                            |  | 224,822 |  |  | 478,622 |  |  | 145,297 |  | 1985
|CRANSTON, RI         |  |                                                                        | 466,100 |                                                       |  | 12,576                                            |  |       | 303,500 |                                                            |  | 175,176 |  |  | 478,676 |  |  | 83,092  |  | 1985
|POTTSTOWN, PA        |  |                                                                        | 430,000 |                                                       |  | 48,854                                            |  |       | 280,000 |                                                            |  | 198,854 |  |  | 478,854 |  |  | 113,801 |  | 1985
|MEDIA, PA            |  |                                                                        | 474,100 |                                                       |  | 5,055                                             |  |       | 308,700 |                                                            |  | 170,455 |  |  | 479,155 |  |  | 77,281  |  | 1985
|WILMINGTON, DE       |  |                                                                        | 446,000 |                                                       |  | 33,323                                            |  |       | 290,400 |                                                            |  | 188,923 |  |  | 479,323 |  |  | 100,322 |  | 1985
|TRENTON, NJ          |  |                                                                        | 466,100 |                                                       |  | 13,987                                            |  |       | 303,500 |                                                            |  | 176,587 |  |  | 480,087 |  |  | 84,289  |  | 1985
|ORANGE, MA           |  |                                                                        | 476,102 |                                                       |  | 4,015                                             |  |       | 250,000 |                                                            |  | 230,117 |  |  | 480,117 |  |  | 213,118 |  | 1991
|CHATHAM, NY          |  |                                                                        | 349,133 |                                                       |  | 131,805                                           |  |       | 225,000 |                                                            |  | 255,938 |  |  | 480,938 |  |  | 175,146 |  | 1985
|CLINTON, MA          |  |                                                                        | 385,600 |                                                       |  | 95,698                                            |  |       | 251,100 |                                                            |  | 230,198 |  |  | 481,298 |  |  | 151,538 |  | 1985
|NUTLEY, NJ           |  |                                                                        | 433,800 |                                                       |  | 48,677                                            |  |       | 282,500 |                                                            |  | 199,977 |  |  | 482,477 |  |  | 113,522 |  | 1985
|JACKSONVILLE, FL     |  |                                                                        | 485,514 |                                                       |  | 0                                                 |  |       | 388,434 |                                                            |  | 97,080  |  |  | 485,514 |  |  | 36,564  |  | 2000
|JERSEY CITY, NJ      |  |                                                                        | 438,000 |                                                       |  | 51,856                                            |  |       | 285,200 |                                                            |  | 204,656 |  |  | 489,856 |  |  | 116,246 |  | 1985
|CLIFTON HGTS., PA    |  |                                                                        | 428,201 |                                                       |  | 63,403                                            |  |       | 256,400 |                                                            |  | 235,204 |  |  | 491,604 |  |  | 155,624 |  | 1985
|LEWISVILLE, TX       |  |                                                                        | 493,734 |                                                       |  | 0                                                 |  |       | 109,925 |                                                            |  | 383,809 |  |  | 493,734 |  |  | 19,703  |  | 2008
|BEVERLY, NJ          |  |                                                                        | 470,100 |                                                       |  | 24,003                                            |  |       | 306,100 |                                                            |  | 188,003 |  |  | 494,103 |  |  | 93,921  |  | 1985
|NEPTUNE, NJ          |  |                                                                        | 455,726 |                                                       |  | 39,090                                            |  |       | 293,000 |                                                            |  | 201,816 |  |  | 494,816 |  |  | 108,946 |  | 1985
|MOORESTOWN, NJ       |  |                                                                        | 470,100 |                                                       |  | 27,064                                            |  |       | 306,100 |                                                            |  | 191,064 |  |  | 497,164 |  |  | 98,571  |  | 1985
|SALEM, NH            |  |                                                                        | 450,000 |                                                       |  | 47,484                                            |  |       | 350,000 |                                                            |  | 147,484 |  |  | 497,484 |  |  | 141,589 |  | 1986
|PLAINFIELD, NJ       |  |                                                                        | 470,100 |                                                       |  | 29,975                                            |  |       | 306,100 |                                                            |  | 193,975 |  |  | 500,075 |  |  | 99,062  |  | 1985
|EAST PROVIDENCE, RI  |  |                                                                        | 486,675 |                                                       |  | 13,947                                            |  |       | 316,600 |                                                            |  | 184,022 |  |  | 500,622 |  |  | 87,766  |  | 1985
|FRAMINGHAM, MA       |  |                                                                        | 297,568 |                                                       |  | 203,147                                           |  |       | 193,419 |                                                            |  | 307,296 |  |  | 500,715 |  |  | 178,557 |  | 1992
|ELMONT, NY           |  |                                                                        | 388,848 |                                                       |  | 114,933                                           |  |       | 231,000 |                                                            |  | 272,781 |  |  | 503,781 |  |  | 239,255 |  | 1978
|METHUEN, MA          |  |                                                                        | 490,200 |                                                       |  | 16,282                                            |  |       | 319,200 |                                                            |  | 187,282 |  |  | 506,482 |  |  | 90,885  |  | 1985
|SOMERVILLE, NJ       |  |                                                                        | 252,717 |                                                       |  | 254,230                                           |  |       | 200,500 |                                                            |  | 306,447 |  |  | 506,947 |  |  | 199,530 |  | 1987
|GLEN HEAD, NY        |  |                                                                        | 462,468 |                                                       |  | 45,355                                            |  |       | 300,900 |                                                            |  | 206,923 |  |  | 507,823 |  |  | 115,455 |  | 1985
|CHESHIRE, CT         |  |                                                                        | 490,200 |                                                       |  | 19,050                                            |  |       | 319,200 |                                                            |  | 190,050 |  |  | 509,250 |  |  | 93,563  |  | 1985
|ALBANY, NY           |  |                                                                        | 404,888 |                                                       |  | 104,378                                           |  |       | 261,600 |                                                            |  | 247,666 |  |  | 509,266 |  |  | 164,570 |  | 1985
|EAST MEADOW, NY      |  |                                                                        | 425,000 |                                                       |  | 86,005                                            |  |       | 325,000 |                                                            |  | 186,005 |  |  | 511,005 |  |  | 149,325 |  | 1986
|WAYNE, NJ            |  |                                                                        | 490,200 |                                                       |  | 21,766                                            |  |       | 319,200 |                                                            |  | 192,766 |  |  | 511,966 |  |  | 95,698  |  | 1985
|NUTLEY, NJ           |  |                                                                        | 0       |                                                       |  | 512,504                                           |  |       | 329,248 |                                                            |  | 183,256 |  |  | 512,504 |  |  | 20,321  |  | 1986
|WEST ROXBURY, MA     |  |                                                                        | 490,200 |                                                       |  | 23,134                                            |  |       | 319,200 |                                                            |  | 194,134 |  |  | 513,334 |  |  | 94,193  |  | 1985
|BRISTOL, PA          |  |                                                                        | 430,500 |                                                       |  | 82,981                                            |  |       | 280,000 |                                                            |  | 233,481 |  |  | 513,481 |  |  | 144,493 |  | 1985
|PLEASANT VALLEY, NY  |  |                                                                        | 398,497 |                                                       |  | 115,129                                           |  |       | 240,000 |                                                            |  | 273,626 |  |  | 513,626 |  |  | 216,045 |  | 1986
|WATERBURY, CT        |  |                                                                        | 515,172 |                                                       |  | 0                                                 |  |       | 334,862 |                                                            |  | 180,310 |  |  | 515,172 |  |  | 30,050  |  | 2004
|FLUSHING, NY         |  |                                                                        | 516,110 |                                                       |  | 0                                                 |  |       | 320,125 |                                                            |  | 195,985 |  |  | 516,110 |  |  | 81,489  |  | 1998
|FAIRVIEW HEIGHTS, IL |  |                                                                        | 516,564 |                                                       |  | 0                                                 |  |       | 78,440  |                                                            |  | 438,124 |  |  | 516,564 |  |  | 40,671  |  | 2007

78

---



|                     |  |                                                                        |         |                                                       |  |                                                   |  |       |         |                                                            |  |         |  |  |         |  |  |         |  |     
|-------------------- |  | ---------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | ------------------------------------------------- |  | ----- | ------- | ---------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                     |  | Initial Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount at Which Carried
 at Close of Period |  |       |         | Date of Initial
 Leasehold or
 Acquisition
 Investment (1)
|                     |  |                                                                        |         |                                                       |  |                                                   | 
|Description          |  |                                                                        |         | Land                                                  |  | Building and
 Improvements                        |  | Total |         | Accumulated
 Depreciation                                  | 
|                     |  |                                                                        |         |                                                       |  |                                                   |  |       |         |                                                            |  |         |  |  |         |  |  |         |  |     
|                    
|WAYNE, NJ            |  |                                                                        | 474,100 |                                                       |  | 42,926                                            |  |       | 308,700 |                                                            |  | 208,326 |  |  | 517,026 |  |  | 114,819 |  | 1985
|WESTBOROUGH, MA      |  |                                                                        | 311,808 |                                                       |  | 205,994                                           |  |       | 202,675 |                                                            |  | 315,127 |  |  | 517,802 |  |  | 181,224 |  | 1991
|STAMFORD, CT         |  |                                                                        | 506,860 |                                                       |  | 15,635                                            |  |       | 329,700 |                                                            |  | 192,795 |  |  | 522,495 |  |  | 92,202  |  | 1985
|SCHENECTADY, NY      |  |                                                                        | 225,000 |                                                       |  | 298,103                                           |  |       | 150,000 |                                                            |  | 373,103 |  |  | 523,103 |  |  | 368,360 |  | 1986
|ROSLYN, PA           |  |                                                                        | 349,500 |                                                       |  | 173,661                                           |  |       | 227,600 |                                                            |  | 295,561 |  |  | 523,161 |  |  | 219,133 |  | 1985
|PHILADELPHIA, PA     |  |                                                                        | 302,999 |                                                       |  | 220,313                                           |  |       | 181,497 |                                                            |  | 341,815 |  |  | 523,312 |  |  | 283,719 |  | 1985
|GREAT NECK, NY       |  |                                                                        | 500,000 |                                                       |  | 24,468                                            |  |       | 450,000 |                                                            |  | 74,468  |  |  | 524,468 |  |  | 74,391  |  | 1985
|STATEN ISLAND, NY    |  |                                                                        | 349,500 |                                                       |  | 176,590                                           |  |       | 227,600 |                                                            |  | 298,490 |  |  | 526,090 |  |  | 188,027 |  | 1985
|HANOVER, PA          |  |                                                                        | 108,435 |                                                       |  | 417,763                                           |  |       | 108,435 |                                                            |  | 417,763 |  |  | 526,198 |  |  | 411,692 |  | 1958
|WHITE PLAINS, NY     |  |                                                                        | 0       |                                                       |  | 527,925                                           |  |       | 302,607 |                                                            |  | 225,318 |  |  | 527,925 |  |  | 119,172 |  | 1972
|SAYVILLE, NY         |  |                                                                        | 528,225 |                                                       |  | 0                                                 |  |       | 300,000 |                                                            |  | 228,225 |  |  | 528,225 |  |  | 95,094  |  | 1998
|GLENDALE, NY         |  |                                                                        | 368,625 |                                                       |  | 159,763                                           |  |       | 235,500 |                                                            |  | 292,888 |  |  | 528,388 |  |  | 180,701 |  | 1985
|BRONX, NY            |  |                                                                        | 78,168  |                                                       |  | 450,267                                           |  |       | 65,680  |                                                            |  | 462,755 |  |  | 528,435 |  |  | 354,837 |  | 1972
|HYDE PARK, MA        |  |                                                                        | 499,175 |                                                       |  | 29,673                                            |  |       | 321,800 |                                                            |  | 207,048 |  |  | 528,848 |  |  | 108,740 |  | 1985
|UNION, NJ            |  |                                                                        | 490,200 |                                                       |  | 41,361                                            |  |       | 319,200 |                                                            |  | 212,361 |  |  | 531,561 |  |  | 112,345 |  | 1985
|WEST MILFORD, NJ     |  |                                                                        | 502,200 |                                                       |  | 31,918                                            |  |       | 327,000 |                                                            |  | 207,118 |  |  | 534,118 |  |  | 108,346 |  | 1985
|SPOTSWOOD, NJ        |  |                                                                        | 466,675 |                                                       |  | 69,036                                            |  |       | 303,500 |                                                            |  | 232,211 |  |  | 535,711 |  |  | 139,777 |  | 1985
|BILLERICA, MA        |  |                                                                        | 400,000 |                                                       |  | 135,809                                           |  |       | 250,000 |                                                            |  | 285,809 |  |  | 535,809 |  |  | 271,481 |  | 1986
|LONG BRANCH, NJ      |  |                                                                        | 514,300 |                                                       |  | 22,951                                            |  |       | 334,900 |                                                            |  | 202,351 |  |  | 537,251 |  |  | 101,290 |  | 1985
|WILMINGTON, DE       |  |                                                                        | 381,700 |                                                       |  | 156,704                                           |  |       | 248,600 |                                                            |  | 289,804 |  |  | 538,404 |  |  | 178,103 |  | 1985
|NEW BEDFORD, MA      |  |                                                                        | 522,300 |                                                       |  | 18,274                                            |  |       | 340,100 |                                                            |  | 200,474 |  |  | 540,574 |  |  | 96,436  |  | 1985
|NORFOLK, VA          |  |                                                                        | 534,910 |                                                       |  | 6,050                                             |  |       | 310,630 |                                                            |  | 230,330 |  |  | 540,960 |  |  | 230,330 |  | 1990
|PLAINVILLE, CT       |  |                                                                        | 544,503 |                                                       |  | 0                                                 |  |       | 353,927 |                                                            |  | 190,576 |  |  | 544,503 |  |  | 31,763  |  | 2004
|SOUTH WINDSOR, CT    |  |                                                                        | 544,857 |                                                       |  | 0                                                 |  |       | 336,737 |                                                            |  | 208,120 |  |  | 544,857 |  |  | 55,038  |  | 2004
|LEVITTOWN, NY        |  |                                                                        | 502,757 |                                                       |  | 42,113                                            |  |       | 327,000 |                                                            |  | 217,870 |  |  | 544,870 |  |  | 117,361 |  | 1985
|JACKSONVILLE, FL     |  |                                                                        | 545,314 |                                                       |  | 0                                                 |  |       | 256,434 |                                                            |  | 288,880 |  |  | 545,314 |  |  | 108,809 |  | 2000
|ARLINGTON, MA        |  |                                                                        | 518,300 |                                                       |  | 27,906                                            |  |       | 337,500 |                                                            |  | 208,706 |  |  | 546,206 |  |  | 106,607 |  | 1985
|STAMFORD, CT         |  |                                                                        | 506,580 |                                                       |  | 40,429                                            |  |       | 329,700 |                                                            |  | 217,309 |  |  | 547,009 |  |  | 115,058 |  | 1985
|WALLINGFORD, CT      |  |                                                                        | 550,553 |                                                       |  | 0                                                 |  |       | 334,901 |                                                            |  | 215,652 |  |  | 550,553 |  |  | 44,771  |  | 2004
|LOWELL, MA           |  |                                                                        | 375,000 |                                                       |  | 175,969                                           |  |       | 250,000 |                                                            |  | 300,969 |  |  | 550,969 |  |  | 244,168 |  | 1986
|PRATTSBURG, NY       |  |                                                                        | 553,136 |                                                       |  | 0                                                 |  |       | 303,136 |                                                            |  | 250,000 |  |  | 553,136 |  |  | 28,333  |  | 2006
|NEW YORK, NY         |  |                                                                        | 146,159 |                                                       |  | 407,286                                           |  |       | 43,461  |                                                            |  | 509,984 |  |  | 553,445 |  |  | 389,146 |  | 1976
|SOUDERTON, PA        |  |                                                                        | 381,700 |                                                       |  | 172,170                                           |  |       | 248,600 |                                                            |  | 305,270 |  |  | 553,870 |  |  | 194,906 |  | 1985
|SALT POINT, NY       |  |                                                                        | 0       |                                                       |  | 554,243                                           |  |       | 301,775 |                                                            |  | 252,468 |  |  | 554,243 |  |  | 93,244  |  | 1987
|MERRICK, NY          |  |                                                                        | 477,498 |                                                       |  | 77,925                                            |  |       | 240,764 |                                                            |  | 314,659 |  |  | 555,423 |  |  | 143,579 |  | 1987
|HARWICHPORT, MA      |  |                                                                        | 382,653 |                                                       |  | 173,989                                           |  |       | 248,724 |                                                            |  | 307,918 |  |  | 556,642 |  |  | 158,168 |  | 1991
|ROCKLAND, MA         |  |                                                                        | 534,300 |                                                       |  | 23,616                                            |  |       | 347,900 |                                                            |  | 210,016 |  |  | 557,916 |  |  | 104,115 |  | 1985
|ROCHESTER, NY        |  |                                                                        | 559,049 |                                                       |  | 0                                                 |  |       | 159,049 |                                                            |  | 400,000 |  |  | 559,049 |  |  | 45,333  |  | 2006
|JACKSONVILLE, FL     |  |                                                                        | 559,514 |                                                       |  | 0                                                 |  |       | 296,434 |                                                            |  | 263,080 |  |  | 559,514 |  |  | 99,091  |  | 2000
|VALATIE, NY          |  |                                                                        | 165,590 |                                                       |  | 394,981                                           |  |       | 90,829  |                                                            |  | 469,742 |  |  | 560,571 |  |  | 410,011 |  | 1989
|FREEHOLD, NJ         |  |                                                                        | 494,275 |                                                       |  | 68,507                                            |  |       | 402,834 |                                                            |  | 159,948 |  |  | 562,782 |  |  | 90,408  |  | 1978
|FALMOUTH, MA         |  |                                                                        | 519,382 |                                                       |  | 43,841                                            |  |       | 458,461 |                                                            |  | 104,762 |  |  | 563,223 |  |  | 103,923 |  | 1988
|FLEMINGTON, NJ       |  |                                                                        | 546,742 |                                                       |  | 17,494                                            |  |       | 346,342 |                                                            |  | 217,894 |  |  | 564,236 |  |  | 103,347 |  | 1985
|WORCESTER, MA        |  |                                                                        | 497,642 |                                                       |  | 67,806                                            |  |       | 321,800 |                                                            |  | 243,648 |  |  | 565,448 |  |  | 145,995 |  | 1985
|PHILADELPHIA, PA     |  |                                                                        | 341,500 |                                                       |  | 224,647                                           |  |       | 222,400 |                                                            |  | 343,747 |  |  | 566,147 |  |  | 213,105 |  | 1985
|RIDGEFIELD, CT       |  |                                                                        | 535,140 |                                                       |  | 33,590                                            |  |       | 347,900 |                                                            |  | 220,830 |  |  | 568,730 |  |  | 114,126 |  | 1985
|EAST HARTFORD, CT    |  |                                                                        | 555,826 |                                                       |  | 13,797                                            |  |       | 301,322 |                                                            |  | 268,301 |  |  | 569,623 |  |  | 79,332  |  | 1991
|HARTFORD, CT         |  |                                                                        | 570,898 |                                                       |  | 0                                                 |  |       | 371,084 |                                                            |  | 199,814 |  |  | 570,898 |  |  | 33,304  |  | 2004
|CENTRAL ISLIP, NY    |  |                                                                        | 572,244 |                                                       |  | 0                                                 |  |       | 357,500 |                                                            |  | 214,744 |  |  | 572,244 |  |  | 89,367  |  | 1998
|HEWLETT, NY          |  |                                                                        | 490,200 |                                                       |  | 85,618                                            |  |       | 319,200 |                                                            |  | 256,618 |  |  | 575,818 |  |  | 125,647 |  | 1985
|NEW BEDFORD, MA      |  |                                                                        | 482,275 |                                                       |  | 95,553                                            |  |       | 293,000 |                                                            |  | 284,828 |  |  | 577,828 |  |  | 190,436 |  | 1985
|PORTSMOUTH, VA       |  |                                                                        | 562,255 |                                                       |  | 17,106                                            |  |       | 221,610 |                                                            |  | 357,751 |  |  | 579,361 |  |  | 353,473 |  | 1990
|LONG ISLAND CITY, NY |  |                                                                        | 191,420 |                                                       |  | 390,783                                           |  |       | 116,554 |                                                            |  | 465,649 |  |  | 582,203 |  |  | 330,427 |  | 1981
|BROOKLYN, NY         |  |                                                                        | 282,104 |                                                       |  | 301,052                                           |  |       | 176,292 |                                                            |  | 406,864 |  |  | 583,156 |  |  | 363,404 |  | 1967
|STATEN ISLAND, NY    |  |                                                                        | 301,300 |                                                       |  | 288,603                                           |  |       | 196,200 |                                                            |  | 393,703 |  |  | 589,903 |  |  | 265,024 |  | 1985
|CLEMENTON, NJ        |  |                                                                        | 562,500 |                                                       |  | 27,581                                            |  |       | 366,300 |                                                            |  | 223,781 |  |  | 590,081 |  |  | 112,687 |  | 1985
|BRIDGEPORT, CT       |  |                                                                        | 526,775 |                                                       |  | 63,505                                            |  |       | 342,700 |                                                            |  | 247,580 |  |  | 590,280 |  |  | 142,201 |  | 1985
|WILTON, CT           |  |                                                                        | 518,881 |                                                       |  | 71,425                                            |  |       | 337,500 |                                                            |  | 252,806 |  |  | 590,306 |  |  | 145,308 |  | 1985
|ROCHESTER, NY        |  |                                                                        | 595,237 |                                                       |  | 0                                                 |  |       | 305,237 |                                                            |  | 290,000 |  |  | 595,237 |  |  | 9,157   |  | 2008
|PEABODY, MA          |  |                                                                        | 400,000 |                                                       |  | 200,363                                           |  |       | 275,000 |                                                            |  | 325,363 |  |  | 600,363 |  |  | 283,709 |  | 1986
|SEWELL, NJ           |  |                                                                        | 551,912 |                                                       |  | 48,485                                            |  |       | 355,712 |                                                            |  | 244,685 |  |  | 600,397 |  |  | 130,610 |  | 1985
|                     |  |                                                                        |         |                                                       |  |                                                   |  |       |         |                                                            |  |         |  |  |         |  |  |         |  |     

79

---



|                      |  |                                                                        |         |                                                       |  |                                                   |  |       |         |                                                            |  |         |  |  |         |  |  |         |  |     
|--------------------- |  | ---------------------------------------------------------------------- | ------- | ----------------------------------------------------- |  | ------------------------------------------------- |  | ----- | ------- | ---------------------------------------------------------- |  | ------- |  |  | ------- |  |  | ------- |  | ----
|                      |  | Initial Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |         | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount at Which Carried
 at Close of Period |  |       |         | Date of Initial
 Leasehold or
 Acquisition
 Investment (1)
|                      |  |                                                                        |         |                                                       |  |                                                   | 
|Description           |  |                                                                        |         | Land                                                  |  | Building and
 Improvements                        |  | Total |         | Accumulated
 Depreciation                                  | 
|                      |  |                                                                        |         |                                                       |  |                                                   |  |       |         |                                                            |  |         |  |  |         |  |  |         |  |     
|                     
|N. PROVIDENCE, RI     |  |                                                                        | 542,400 |                                                       |  | 61,717                                            |  |       | 353,200 |                                                            |  | 250,917 |  |  | 604,117 |  |  | 143,693 |  | 1985
|NEW YORK, NY          |  |                                                                        | 0       |                                                       |  | 605,891                                           |  |       | 0       |                                                            |  | 605,891 |  |  | 605,891 |  |  | 443,005 |  | 1986
|FITCHBURG, MA         |  |                                                                        | 390,276 |                                                       |  | 216,589                                           |  |       | 253,679 |                                                            |  | 353,186 |  |  | 606,865 |  |  | 187,140 |  | 1992
|KERNERSVILLE, NC      |  |                                                                        | 608,441 |                                                       |  | 0                                                 |  |       | 250,505 |                                                            |  | 357,936 |  |  | 608,441 |  |  | 35,761  |  | 2007
|NORTH ANDOVER, MA     |  |                                                                        | 393,700 |                                                       |  | 220,132                                           |  |       | 256,400 |                                                            |  | 357,432 |  |  | 613,832 |  |  | 223,589 |  | 1985
|FLORAL PARK, NY       |  |                                                                        | 616,700 |                                                       |  | 0                                                 |  |       | 356,400 |                                                            |  | 260,300 |  |  | 616,700 |  |  | 108,328 |  | 1998
|ASHAWAY, RI           |  |                                                                        | 618,609 |                                                       |  | 0                                                 |  |       | 402,096 |                                                            |  | 216,513 |  |  | 618,609 |  |  | 36,088  |  | 2004
|NORWALK, CT           |  |                                                                        | 0       |                                                       |  | 619,018                                           |  |       | 401,996 |                                                            |  | 217,022 |  |  | 619,018 |  |  | 24,661  |  | 1988
|HALFMOON, NY          |  |                                                                        | 415,000 |                                                       |  | 205,598                                           |  |       | 228,100 |                                                            |  | 392,498 |  |  | 620,598 |  |  | 383,236 |  | 1986
|HAMBURG, NJ           |  |                                                                        | 598,600 |                                                       |  | 22,121                                            |  |       | 389,800 |                                                            |  | 230,921 |  |  | 620,721 |  |  | 112,487 |  | 1985
|ASHLAND, MA           |  |                                                                        | 606,700 |                                                       |  | 17,424                                            |  |       | 395,100 |                                                            |  | 229,024 |  |  | 624,124 |  |  | 106,153 |  | 1985
|RANDALLSTOWN, MD      |  |                                                                        | 590,600 |                                                       |  | 33,594                                            |  |       | 384,600 |                                                            |  | 239,594 |  |  | 624,194 |  |  | 123,548 |  | 1985
|WESTPORT, CT          |  |                                                                        | 603,260 |                                                       |  | 23,070                                            |  |       | 392,500 |                                                            |  | 233,830 |  |  | 626,330 |  |  | 111,073 |  | 1985
|PHILADELPHIA, PA      |  |                                                                        | 405,800 |                                                       |  | 221,269                                           |  |       | 264,300 |                                                            |  | 362,769 |  |  | 627,069 |  |  | 243,263 |  | 1985
|PHILADELPHIA, PA      |  |                                                                        | 417,800 |                                                       |  | 210,406                                           |  |       | 272,100 |                                                            |  | 356,106 |  |  | 628,206 |  |  | 209,874 |  | 1985
|PATERSON, NJ          |  |                                                                        | 619,548 |                                                       |  | 16,765                                            |  |       | 402,900 |                                                            |  | 233,413 |  |  | 636,313 |  |  | 111,062 |  | 1985
|DOVER, NJ             |  |                                                                        | 606,700 |                                                       |  | 30,153                                            |  |       | 395,100 |                                                            |  | 241,753 |  |  | 636,853 |  |  | 120,840 |  | 1985
|CRANBURY, NJ          |  |                                                                        | 606,700 |                                                       |  | 31,467                                            |  |       | 395,100 |                                                            |  | 243,067 |  |  | 638,167 |  |  | 122,575 |  | 1985
|KERNERSVILLE, NC      |  |                                                                        | 638,633 |                                                       |  | 0                                                 |  |       | 338,386 |                                                            |  | 300,247 |  |  | 638,633 |  |  | 31,437  |  | 2007
|CLINTON, MA           |  |                                                                        | 586,600 |                                                       |  | 52,725                                            |  |       | 382,000 |                                                            |  | 257,325 |  |  | 639,325 |  |  | 138,047 |  | 1985
|WANTAGH, NY           |  |                                                                        | 640,680 |                                                       |  | 0                                                 |  |       | 370,200 |                                                            |  | 270,480 |  |  | 640,680 |  |  | 112,697 |  | 1998
|STERLING, MA          |  |                                                                        | 476,102 |                                                       |  | 165,998                                           |  |       | 309,466 |                                                            |  | 332,634 |  |  | 642,100 |  |  | 157,235 |  | 1991
|PHILADELPHIA, PA      |  |                                                                        | 369,600 |                                                       |  | 273,642                                           |  |       | 240,700 |                                                            |  | 402,542 |  |  | 643,242 |  |  | 291,682 |  | 1985
|PHILADELPHIA, PA      |  |                                                                        | 369,600 |                                                       |  | 276,720                                           |  |       | 240,700 |                                                            |  | 405,620 |  |  | 646,320 |  |  | 275,273 |  | 1985
|EASTCHESTER, NY       |  |                                                                        | 614,700 |                                                       |  | 34,500                                            |  |       | 400,300 |                                                            |  | 248,900 |  |  | 649,200 |  |  | 126,891 |  | 1985
|BALTIMORE, MD         |  |                                                                        | 474,100 |                                                       |  | 176,067                                           |  |       | 308,700 |                                                            |  | 341,467 |  |  | 650,167 |  |  | 201,170 |  | 1985
|WORCESTER, MA         |  |                                                                        | 476,102 |                                                       |  | 174,233                                           |  |       | 309,466 |                                                            |  | 340,869 |  |  | 650,335 |  |  | 332,336 |  | 1991
|NORTH MERRICK, NY     |  |                                                                        | 510,350 |                                                       |  | 141,506                                           |  |       | 332,200 |                                                            |  | 319,656 |  |  | 651,856 |  |  | 183,150 |  | 1985
|BELMAR, NJ            |  |                                                                        | 630,800 |                                                       |  | 22,371                                            |  |       | 410,800 |                                                            |  | 242,371 |  |  | 653,171 |  |  | 117,831 |  | 1985
|BROOKLYN, NY          |  |                                                                        | 276,831 |                                                       |  | 376,706                                           |  |       | 168,423 |                                                            |  | 485,114 |  |  | 653,537 |  |  | 357,052 |  | 1978
|WATERTOWN, MA         |  |                                                                        | 357,500 |                                                       |  | 296,588                                           |  |       | 321,030 |                                                            |  | 333,058 |  |  | 654,088 |  |  | 213,660 |  | 1985
|PORT EWEN, NY         |  |                                                                        | 657,147 |                                                       |  | 0                                                 |  |       | 176,924 |                                                            |  | 480,223 |  |  | 657,147 |  |  | 47,853  |  | 2007
|HASBROUCK HEIGHTS, NJ |  |                                                                        | 639,648 |                                                       |  | 19,648                                            |  |       | 416,000 |                                                            |  | 243,296 |  |  | 659,296 |  |  | 115,788 |  | 1985
|LEVITTOWN, NY         |  |                                                                        | 546,400 |                                                       |  | 113,057                                           |  |       | 355,800 |                                                            |  | 303,657 |  |  | 659,457 |  |  | 162,557 |  | 1985
|LANCASTER, PA         |  |                                                                        | 642,000 |                                                       |  | 17,993                                            |  |       | 300,000 |                                                            |  | 359,993 |  |  | 659,993 |  |  | 359,993 |  | 1989
|HARTFORD, CT          |  |                                                                        | 664,966 |                                                       |  | 0                                                 |  |       | 432,228 |                                                            |  | 232,738 |  |  | 664,966 |  |  | 38,792  |  | 2004
|ROCKVILLE CENTRE, NY  |  |                                                                        | 350,325 |                                                       |  | 315,779                                           |  |       | 201,400 |                                                            |  | 464,704 |  |  | 666,104 |  |  | 352,076 |  | 1985
|FEASTERVILLE, PA      |  |                                                                        | 510,200 |                                                       |  | 160,144                                           |  |       | 332,200 |                                                            |  | 338,144 |  |  | 670,344 |  |  | 215,694 |  | 1985
|NORTH ATTLEBORO, MA   |  |                                                                        | 662,900 |                                                       |  | 16,549                                            |  |       | 431,700 |                                                            |  | 247,749 |  |  | 679,449 |  |  | 116,320 |  | 1985
|WEYMOUTH, MA          |  |                                                                        | 643,297 |                                                       |  | 36,516                                            |  |       | 418,600 |                                                            |  | 261,213 |  |  | 679,813 |  |  | 129,700 |  | 1985
|RENSSELAER, NY        |  |                                                                        | 683,781 |                                                       |  | 0                                                 |  |       | 286,504 |                                                            |  | 397,277 |  |  | 683,781 |  |  | 87,339  |  | 2004
|BATAVIA, NY           |  |                                                                        | 684,279 |                                                       |  | 0                                                 |  |       | 364,279 |                                                            |  | 320,000 |  |  | 684,279 |  |  | 36,267  |  | 2006
|MCAFEE, NJ            |  |                                                                        | 670,900 |                                                       |  | 15,711                                            |  |       | 436,900 |                                                            |  | 249,711 |  |  | 686,611 |  |  | 116,230 |  | 1985
|BROOKLYN, NY          |  |                                                                        | 421,800 |                                                       |  | 270,436                                           |  |       | 274,700 |                                                            |  | 417,536 |  |  | 692,236 |  |  | 266,711 |  | 1985
|DARIEN, CT            |  |                                                                        | 667,180 |                                                       |  | 26,061                                            |  |       | 434,300 |                                                            |  | 258,941 |  |  | 693,241 |  |  | 126,796 |  | 1985
|HYANNIS, MA           |  |                                                                        | 650,800 |                                                       |  | 42,552                                            |  |       | 423,800 |                                                            |  | 269,552 |  |  | 693,352 |  |  | 141,554 |  | 1985
|MOUNTAINSIDE, NJ      |  |                                                                        | 664,100 |                                                       |  | 31,620                                            |  |       | 431,700 |                                                            |  | 264,020 |  |  | 695,720 |  |  | 130,274 |  | 1985
|WINSTON SALEM, NC     |  |                                                                        | 696,397 |                                                       |  | 0                                                 |  |       | 251,987 |                                                            |  | 444,410 |  |  | 696,397 |  |  | 48,678  |  | 2007
|EAST HAMPTON, NY      |  |                                                                        | 659,127 |                                                       |  | 39,313                                            |  |       | 427,827 |                                                            |  | 270,613 |  |  | 698,440 |  |  | 137,463 |  | 1985
|BARRE, MA             |  |                                                                        | 535,614 |                                                       |  | 163,028                                           |  |       | 348,149 |                                                            |  | 350,493 |  |  | 698,642 |  |  | 160,830 |  | 1991
|BARRINGTON, RI        |  |                                                                        | 490,200 |                                                       |  | 213,866                                           |  |       | 319,200 |                                                            |  | 384,866 |  |  | 704,066 |  |  | 266,871 |  | 1985
|DOBBS FERRY, NY       |  |                                                                        | 670,575 |                                                       |  | 33,706                                            |  |       | 434,300 |                                                            |  | 269,981 |  |  | 704,281 |  |  | 135,250 |  | 1985
|NORTH BERGEN, NJ      |  |                                                                        | 629,527 |                                                       |  | 81,006                                            |  |       | 409,527 |                                                            |  | 301,006 |  |  | 710,533 |  |  | 173,873 |  | 1985
|PHILADELPHIA, PA      |  |                                                                        | 687,000 |                                                       |  | 25,017                                            |  |       | 447,400 |                                                            |  | 264,617 |  |  | 712,017 |  |  | 127,431 |  | 1985
|FRANKLIN TWP., NJ     |  |                                                                        | 683,000 |                                                       |  | 30,257                                            |  |       | 444,800 |                                                            |  | 268,457 |  |  | 713,257 |  |  | 133,770 |  | 1985
|ALFRED STATION, NY    |  |                                                                        | 714,108 |                                                       |  | 0                                                 |  |       | 414,108 |                                                            |  | 300,000 |  |  | 714,108 |  |  | 34,000  |  | 2006
|NEW HAVEN, CT         |  |                                                                        | 538,400 |                                                       |  | 176,230                                           |  |       | 350,600 |                                                            |  | 364,030 |  |  | 714,630 |  |  | 258,057 |  | 1985
|STAMFORD, CT          |  |                                                                        | 603,260 |                                                       |  | 112,305                                           |  |       | 392,500 |                                                            |  | 323,065 |  |  | 715,565 |  |  | 201,191 |  | 1985
|BLOOMFIELD, NJ        |  |                                                                        | 695,000 |                                                       |  | 21,021                                            |  |       | 371,400 |                                                            |  | 344,621 |  |  | 716,021 |  |  | 230,898 |  | 1985
|BAYSIDE, NY           |  |                                                                        | 470,100 |                                                       |  | 246,576                                           |  |       | 306,100 |                                                            |  | 410,576 |  |  | 716,676 |  |  | 248,075 |  | 1985
|WILLIMANTIC, CT       |  |                                                                        | 716,782 |                                                       |  | 0                                                 |  |       | 465,908 |                                                            |  | 250,874 |  |  | 716,782 |  |  | 41,813  |  | 2004

80

---



|                        |  |                                                                        |           |                                                       |  |                                                   |   |       |         |                                                            |  |         |  |  |           |  |  |         |  |     
|----------------------- |  | ---------------------------------------------------------------------- | --------- | ----------------------------------------------------- |  | ------------------------------------------------- | - | ----- | ------- | ---------------------------------------------------------- |  | ------- |  |  | --------- |  |  | ------- |  | ----
|                        |  | Initial Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |           | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount at Which Carried
 at Close of Period |   |       |         | Date of Initial
 Leasehold or
 Acquisition
 Investment (1)
|                        |  |                                                                        |           |                                                       |  |                                                   |  
|Description             |  |                                                                        |           | Land                                                  |  | Building and
 Improvements                        |   | Total |         | Accumulated
 Depreciation                                  | 
|                        |  |                                                                        |           |                                                       |  |                                                   |   |       |         |                                                            |  |         |  |  |           |  |  |         |  |     
|                       
|TRENTON, NJ             |  |                                                                        | 684,650   |                                                       |  | 33,275                                            |   |       | 444,800 |                                                            |  | 273,125 |  |  | 717,925   |  |  | 137,961 |  | 1985
|BRONX, NY               |  |                                                                        | 390,200   |                                                       |  | 329,357                                           |   |       | 251,100 |                                                            |  | 468,457 |  |  | 719,557   |  |  | 296,590 |  | 1985
|NORWALK, CT             |  |                                                                        | 510,760   |                                                       |  | 209,820                                           |   |       | 332,200 |                                                            |  | 388,380 |  |  | 720,580   |  |  | 239,435 |  | 1985
|ST. GEORGES, DE         |  |                                                                        | 498,200   |                                                       |  | 222,596                                           |   |       | 324,725 |                                                            |  | 396,071 |  |  | 720,796   |  |  | 293,151 |  | 1985
|SANDSTON, VA            |  |                                                                        | 0         |                                                       |  | 721,651                                           |   |       | 101,651 |                                                            |  | 620,000 |  |  | 721,651   |  |  | 93,000  |  | 2005
|RIVERHEAD, NY           |  |                                                                        | 723,346   |                                                       |  | 0                                                 |   |       | 431,700 |                                                            |  | 291,646 |  |  | 723,346   |  |  | 121,374 |  | 1998
|AVON, CT                |  |                                                                        | 730,886   |                                                       |  | 0                                                 |   |       | 402,949 |                                                            |  | 327,937 |  |  | 730,886   |  |  | 96,628  |  | 2002
|BIDDEFORD, ME           |  |                                                                        | 723,100   |                                                       |  | 8,009                                             |   |       | 340,000 |                                                            |  | 391,109 |  |  | 731,109   |  |  | 325,049 |  | 1985
|NEWTON, MA              |  |                                                                        | 691,000   |                                                       |  | 42,832                                            |   |       | 450,000 |                                                            |  | 283,832 |  |  | 733,832   |  |  | 141,538 |  | 1985
|LONDONDERRY, NH         |  |                                                                        | 703,100   |                                                       |  | 31,092                                            |   |       | 457,900 |                                                            |  | 276,292 |  |  | 734,192   |  |  | 136,026 |  | 1985
|SAG HARBOR, NY          |  |                                                                        | 703,600   |                                                       |  | 36,012                                            |   |       | 458,200 |                                                            |  | 281,412 |  |  | 739,612   |  |  | 143,094 |  | 1985
|RIDGEWOOD, NJ           |  |                                                                        | 703,100   |                                                       |  | 36,959                                            |   |       | 457,900 |                                                            |  | 282,159 |  |  | 740,059   |  |  | 140,211 |  | 1985
|FLEMINGTON, NJ          |  |                                                                        | 708,160   |                                                       |  | 33,072                                            |   |       | 460,500 |                                                            |  | 280,732 |  |  | 741,232   |  |  | 137,084 |  | 1985
|PRINCETON, NJ           |  |                                                                        | 703,100   |                                                       |  | 40,615                                            |   |       | 457,900 |                                                            |  | 285,815 |  |  | 743,715   |  |  | 146,858 |  | 1985
|HARRISBURG, PA          |  |                                                                        | 399,016   |                                                       |  | 347,590                                           |   |       | 198,740 |                                                            |  | 547,866 |  |  | 746,606   |  |  | 344,802 |  | 1989
|MAYNARD, MA             |  |                                                                        | 735,200   |                                                       |  | 12,714                                            |   |       | 478,800 |                                                            |  | 269,114 |  |  | 747,914   |  |  | 122,939 |  | 1985
|BROOKLYN, NY            |  |                                                                        | 476,816   |                                                       |  | 272,765                                           |   |       | 306,100 |                                                            |  | 443,481 |  |  | 749,581   |  |  | 281,823 |  | 1985
|WORCESTER, MA           |  |                                                                        | 547,283   |                                                       |  | 205,733                                           |   |       | 355,734 |                                                            |  | 397,282 |  |  | 753,016   |  |  | 195,499 |  | 1991
|BRIARCLIFF MANOR, NY    |  |                                                                        | 652,213   |                                                       |  | 103,753                                           |   |       | 501,687 |                                                            |  | 254,279 |  |  | 755,966   |  |  | 231,839 |  | 1976
|SALEM, NH               |  |                                                                        | 743,200   |                                                       |  | 19,847                                            |   |       | 484,000 |                                                            |  | 279,047 |  |  | 763,047   |  |  | 130,478 |  | 1985
|ROCKLAND, MA            |  |                                                                        | 578,600   |                                                       |  | 185,285                                           |   |       | 376,800 |                                                            |  | 387,085 |  |  | 763,885   |  |  | 234,817 |  | 1985
|RANDOLPH, MA            |  |                                                                        | 743,200   |                                                       |  | 25,069                                            |   |       | 484,000 |                                                            |  | 284,269 |  |  | 768,269   |  |  | 136,189 |  | 1985
|FAIRHAVEN, MA           |  |                                                                        | 725,500   |                                                       |  | 48,828                                            |   |       | 470,900 |                                                            |  | 303,428 |  |  | 774,328   |  |  | 158,477 |  | 1985
|EAST PEMBROKE, NY       |  |                                                                        | 787,465   |                                                       |  | 0                                                 |   |       | 537,465 |                                                            |  | 250,000 |  |  | 787,465   |  |  | 28,333  |  | 2006
|READING, PA             |  |                                                                        | 750,000   |                                                       |  | 49,125                                            |   |       | 0       |                                                            |  | 799,125 |  |  | 799,125   |  |  | 789,901 |  | 1989
|WOBURN, MA              |  |                                                                        | 507,600   |                                                       |  | 294,303                                           |   |       | 507,600 |                                                            |  | 294,303 |  |  | 801,903   |  |  | 140,533 |  | 1985
|BALTIMORE, MD           |  |                                                                        | 802,414   |                                                       |  | 0                                                 |   |       | 0       |                                                            |  | 802,414 |  |  | 802,414   |  |  | 70,212  |  | 2007
|UNION CITY, NJ          |  |                                                                        | 799,500   |                                                       |  | 3,440                                             |   |       | 520,600 |                                                            |  | 282,340 |  |  | 802,940   |  |  | 125,227 |  | 1985
|WATERBURY, CT           |  |                                                                        | 804,040   |                                                       |  | 0                                                 |   |       | 516,387 |                                                            |  | 287,653 |  |  | 804,040   |  |  | 52,496  |  | 2004
|STOUGHTON, MA           |  |                                                                        | 775,300   |                                                       |  | 34,554                                            |   |       | 504,900 |                                                            |  | 304,954 |  |  | 809,854   |  |  | 148,890 |  | 1985
|ROCHESTER, NY           |  |                                                                        | 823,031   |                                                       |  | 0                                                 |   |       | 273,031 |                                                            |  | 550,000 |  |  | 823,031   |  |  | 63,358  |  | 2006
|WEST ORANGE, NJ         |  |                                                                        | 799,500   |                                                       |  | 34,733                                            |   |       | 520,600 |                                                            |  | 313,633 |  |  | 834,233   |  |  | 156,456 |  | 1985
|ASHLAND, VA             |  |                                                                        | 0         |                                                       |  | 839,997                                           |   |       | 839,997 |                                                            |  | 0       |  |  | 839,997   |  |  | 0       |  | 2005
|SUFFIELD, CT            |  |                                                                        | 237,401   |                                                       |  | 602,635                                           |   |       | 200,878 |                                                            |  | 639,158 |  |  | 840,036   |  |  | 187,636 |  | 2004
|WALKERTOWN, NC          |  |                                                                        | 844,749   |                                                       |  | 0                                                 |   |       | 488,239 |                                                            |  | 356,509 |  |  | 844,749   |  |  | 39,562  |  | 2007
|W.READING, PA           |  |                                                                        | 790,432   |                                                       |  | 68,726                                            |   |       | 387,641 |                                                            |  | 471,517 |  |  | 859,158   |  |  | 465,075 |  | 1989
|BELLINGHAM, MA          |  |                                                                        | 734,189   |                                                       |  | 132,725                                           |   |       | 476,200 |                                                            |  | 390,714 |  |  | 866,914   |  |  | 239,279 |  | 1985
|ORLANDO, FL             |  |                                                                        | 867,515   |                                                       |  | 0                                                 |   |       | 401,435 |                                                            |  | 466,080 |  |  | 867,515   |  |  | 175,554 |  | 2000
|JONESBORO, AR           |  |                                                                        | 868,501   |                                                       |  | 0                                                 |   |       | 173,096 |                                                            |  | 695,405 |  |  | 868,501   |  |  | 31,284  |  | 2007
|FALL RIVER, MA          |  |                                                                        | 859,800   |                                                       |  | 24,423                                            |   |       | 559,900 |                                                            |  | 324,323 |  |  | 884,223   |  |  | 153,018 |  | 1985
|ELLICOTT CITY, MD       |  |                                                                        | 895,049   |                                                       |  | (0                                                | ) |       | 0       |                                                            |  | 895,049 |  |  | 895,049   |  |  | 82,439  |  | 2007
|SUTTON, MA              |  |                                                                        | 714,159   |                                                       |  | 187,355                                           |   |       | 464,203 |                                                            |  | 437,311 |  |  | 901,514   |  |  | 200,066 |  | 1993
|LIVINGSTON, NJ          |  |                                                                        | 871,800   |                                                       |  | 30,003                                            |   |       | 567,700 |                                                            |  | 334,103 |  |  | 901,803   |  |  | 161,144 |  | 1985
|MECHANICSVILLE, VA      |  |                                                                        | 0         |                                                       |  | 902,892                                           |   |       | 272,892 |                                                            |  | 630,000 |  |  | 902,892   |  |  | 94,500  |  | 2005
|BROOKLYN, NY            |  |                                                                        | 626,700   |                                                       |  | 282,677                                           |   |       | 408,100 |                                                            |  | 501,277 |  |  | 909,377   |  |  | 320,294 |  | 1985
|CHESAPEAKE, VA          |  |                                                                        | 883,685   |                                                       |  | 26,247                                            |   |       | 325,508 |                                                            |  | 584,424 |  |  | 909,932   |  |  | 579,208 |  | 1990
|MIDDLETOWN, NY          |  |                                                                        | 751,200   |                                                       |  | 166,411                                           |   |       | 489,200 |                                                            |  | 428,411 |  |  | 917,611   |  |  | 225,350 |  | 1985
|MANSFIELD, OH           |  |                                                                        | 921,108   |                                                       |  | 0                                                 |   |       | 331,599 |                                                            |  | 589,509 |  |  | 921,108   |  |  | 6,862   |  | 2008
|WATERTOWN, CT           |  |                                                                        | 924,586   |                                                       |  | 0                                                 |   |       | 566,986 |                                                            |  | 357,600 |  |  | 924,586   |  |  | 94,466  |  | 2004
|PLYMOUTH, CT            |  |                                                                        | 930,885   |                                                       |  | 0                                                 |   |       | 605,075 |                                                            |  | 325,810 |  |  | 930,885   |  |  | 54,300  |  | 2004
|WASHINGTON TOWNSHIP, NJ |  |                                                                        | 912,000   |                                                       |  | 21,261                                            |   |       | 593,900 |                                                            |  | 339,361 |  |  | 933,261   |  |  | 159,158 |  | 1985
|AVOCA, NY               |  |                                                                        | 935,543   |                                                       |  | 0                                                 |   |       | 634,543 |                                                            |  | 301,000 |  |  | 935,543   |  |  | 34,000  |  | 2006
|NEWINGTON, CT           |  |                                                                        | 953,512   |                                                       |  | 0                                                 |   |       | 619,783 |                                                            |  | 333,729 |  |  | 953,512   |  |  | 55,621  |  | 2004
|OCEAN CITY, NJ          |  |                                                                        | 843,700   |                                                       |  | 113,162                                           |   |       | 549,400 |                                                            |  | 407,462 |  |  | 956,862   |  |  | 240,926 |  | 1985
|MECHANICSVILLE, VA      |  |                                                                        | 0         |                                                       |  | 957,418                                           |   |       | 324,158 |                                                            |  | 633,260 |  |  | 957,418   |  |  | 134,666 |  | 2005
|BYRON, NY               |  |                                                                        | 969,117   |                                                       |  | 0                                                 |   |       | 669,117 |                                                            |  | 300,000 |  |  | 969,117   |  |  | 34,000  |  | 2006
|ROCHESTER, NH           |  |                                                                        | 972,200   |                                                       |  | 12,775                                            |   |       | 633,100 |                                                            |  | 351,875 |  |  | 984,975   |  |  | 159,658 |  | 1985
|WARSAW, NY              |  |                                                                        | 990,259   |                                                       |  | 0                                                 |   |       | 690,259 |                                                            |  | 300,000 |  |  | 990,259   |  |  | 34,000  |  | 2006
|DURHAM, CT              |  |                                                                        | 993,909   |                                                       |  | 0                                                 |   |       | 0       |                                                            |  | 993,909 |  |  | 993,909   |  |  | 414,129 |  | 2004
|CHURCHVILLE, NY         |  |                                                                        | 1,011,381 |                                                       |  | 0                                                 |   |       | 601,381 |                                                            |  | 410,000 |  |  | 1,011,381 |  |  | 46,467  |  | 2006
|GREIGSVILLE, NY         |  |                                                                        | 1,017,739 |                                                       |  | 0                                                 |   |       | 202,873 |                                                            |  | 814,866 |  |  | 1,017,739 |  |  | 38,307  |  | 2008

81

---



|                     |  |                                                                        |           |                                                       |  |                                                   |   |       |           |                                                            |  |           |  |  |           |  |  |         |  |     
|-------------------- |  | ---------------------------------------------------------------------- | --------- | ----------------------------------------------------- |  | ------------------------------------------------- | - | ----- | --------- | ---------------------------------------------------------- |  | --------- |  |  | --------- |  |  | ------- |  | ----
|                     |  | Initial Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |           | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |  | Gross Amount at Which Carried
 at Close of Period |   |       |           | Date of Initial
 Leasehold or
 Acquisition
 Investment (1)
|                     |  |                                                                        |           |                                                       |  |                                                   |  
|Description          |  |                                                                        |           | Land                                                  |  | Building and
 Improvements                        |   | Total |           | Accumulated
 Depreciation                                  | 
|                     |  |                                                                        |           |                                                       |  |                                                   |   |       |           |                                                            |  |           |  |  |           |  |  |         |  |     
|                    
|COLONIA, NJ          |  |                                                                        | 952,200   |                                                       |  | 74,451                                            |   |       | 620,100   |                                                            |  | 406,551   |  |  | 1,026,651 |  |  | 216,295 |  | 1985
|LAKEVILLE, NY        |  |                                                                        | 1,027,783 |                                                       |  | 0                                                 |   |       | 202,857   |                                                            |  | 824,926   |  |  | 1,027,783 |  |  | 39,197  |  | 2008
|CHESAPEAKE, VA       |  |                                                                        | 1,026,115 |                                                       |  | 7,149                                             |   |       | 407,026   |                                                            |  | 626,238   |  |  | 1,033,264 |  |  | 624,636 |  | 1990
|GLEN ALLEN, VA       |  |                                                                        | 0         |                                                       |  | 1,036,585                                         |   |       | 411,585   |                                                            |  | 625,000   |  |  | 1,036,585 |  |  | 93,750  |  | 2005
|LODI, NJ             |  |                                                                        | 0         |                                                       |  | 1,037,440                                         |   |       | 587,823   |                                                            |  | 449,617   |  |  | 1,037,440 |  |  | 151,871 |  | 1988
|MIDDLETOWN, CT       |  |                                                                        | 1,038,592 |                                                       |  | 0                                                 |   |       | 675,085   |                                                            |  | 363,507   |  |  | 1,038,592 |  |  | 60,583  |  | 2004
|WINDSOR, CT          |  |                                                                        | 1,042,081 |                                                       |  | 0                                                 |   |       | 669,804   |                                                            |  | 372,277   |  |  | 1,042,081 |  |  | 155,117 |  | 2004
|MECHANICSVILLE, VA   |  |                                                                        | 0         |                                                       |  | 1,042,870                                         |   |       | 222,870   |                                                            |  | 820,000   |  |  | 1,042,870 |  |  | 123,000 |  | 2005
|NEW OXFORD, PA       |  |                                                                        | 1,044,707 |                                                       |  | 13,500                                            |   |       | 18,687    |                                                            |  | 1,039,520 |  |  | 1,058,207 |  |  | 791,323 |  | 1996
|HONOLULU, HI         |  |                                                                        | 1,070,141 |                                                       |  | 0                                                 |   |       | 980,680   |                                                            |  | 89,460    |  |  | 1,070,141 |  |  | 12,630  |  | 2007
|GLEN ALLEN, VA       |  |                                                                        | 0         |                                                       |  | 1,077,402                                         |   |       | 322,402   |                                                            |  | 755,000   |  |  | 1,077,402 |  |  | 113,250 |  | 2005
|WEBSTER, MA          |  |                                                                        | 1,012,400 |                                                       |  | 67,645                                            |   |       | 659,300   |                                                            |  | 420,745   |  |  | 1,080,045 |  |  | 218,323 |  | 1985
|GARDNER, MA          |  |                                                                        | 1,008,400 |                                                       |  | 73,740                                            |   |       | 656,700   |                                                            |  | 425,440   |  |  | 1,082,140 |  |  | 217,211 |  | 1985
|YONKERS, NY          |  |                                                                        | 1,020,400 |                                                       |  | 61,875                                            |   |       | 664,500   |                                                            |  | 417,775   |  |  | 1,082,275 |  |  | 212,485 |  | 1985
|SEEKONK, MA          |  |                                                                        | 1,072,700 |                                                       |  | 29,112                                            |   |       | 698,500   |                                                            |  | 403,312   |  |  | 1,101,812 |  |  | 187,535 |  | 1985
|MECHANICSVILLE, VA   |  |                                                                        | 0         |                                                       |  | 1,124,769                                         |   |       | 504,769   |                                                            |  | 620,000   |  |  | 1,124,769 |  |  | 93,000  |  | 2005
|RICHMOND, VA         |  |                                                                        | 0         |                                                       |  | 1,131,878                                         |   |       | 546,878   |                                                            |  | 585,000   |  |  | 1,131,878 |  |  | 87,750  |  | 2005
|WALNUT COVE, NC      |  |                                                                        | 1,140,945 |                                                       |  | 0                                                 |   |       | 513,565   |                                                            |  | 627,380   |  |  | 1,140,945 |  |  | 69,314  |  | 2007
|SHRUB OAK, NY        |  |                                                                        | 1,060,700 |                                                       |  | 81,807                                            |   |       | 690,700   |                                                            |  | 451,807   |  |  | 1,142,507 |  |  | 238,435 |  | 1985
|WORCESTER, MA        |  |                                                                        | 978,880   |                                                       |  | 191,413                                           |   |       | 636,272   |                                                            |  | 534,021   |  |  | 1,170,293 |  |  | 217,313 |  | 1991
|CRESTLINE, OH        |  |                                                                        | 1,201,523 |                                                       |  | 0                                                 |   |       | 284,761   |                                                            |  | 916,762   |  |  | 1,201,523 |  |  | 11,367  |  | 2008
|WEST HAVEN, CT       |  |                                                                        | 1,214,831 |                                                       |  | 0                                                 |   |       | 789,640   |                                                            |  | 425,191   |  |  | 1,214,831 |  |  | 70,867  |  | 2004
|CHESAPEAKE, VA       |  |                                                                        | 1,184,759 |                                                       |  | 32,132                                            |   |       | 604,983   |                                                            |  | 611,908   |  |  | 1,216,891 |  |  | 132,131 |  | 1990
|FARMVILLE, VA        |  |                                                                        | 0         |                                                       |  | 1,226,505                                         |   |       | 621,505   |                                                            |  | 605,000   |  |  | 1,226,505 |  |  | 90,750  |  | 2005
|BELFIELD, ND         |  |                                                                        | 1,232,010 |                                                       |  | 0                                                 |   |       | 381,909   |                                                            |  | 850,101   |  |  | 1,232,010 |  |  | 129,470 |  | 2007
|BRONX, NY            |  |                                                                        | 543,833   |                                                       |  | 693,438                                           |   |       | 473,695   |                                                            |  | 763,576   |  |  | 1,237,271 |  |  | 752,658 |  | 1970
|NAPLES, NY           |  |                                                                        | 1,257,487 |                                                       |  | 0                                                 |   |       | 827,487   |                                                            |  | 430,000   |  |  | 1,257,487 |  |  | 48,733  |  | 2006
|FREDERICKSBURG, VA   |  |                                                                        | 0         |                                                       |  | 1,279,280                                         |   |       | 469,280   |                                                            |  | 810,000   |  |  | 1,279,280 |  |  | 121,500 |  | 2005
|FORT LEE, NJ         |  |                                                                        | 1,245,500 |                                                       |  | 39,408                                            |   |       | 811,100   |                                                            |  | 473,808   |  |  | 1,284,908 |  |  | 227,313 |  | 1985
|FREDERICKSBURG, VA   |  |                                                                        | 0         |                                                       |  | 1,289,425                                         |   |       | 798,444   |                                                            |  | 490,981   |  |  | 1,289,425 |  |  | 94,004  |  | 2005
|SPOTSYLVANIA, VA     |  |                                                                        | 0         |                                                       |  | 1,290,239                                         |   |       | 490,239   |                                                            |  | 800,000   |  |  | 1,290,239 |  |  | 120,000 |  | 2005
|EL CAJON, CA         |  |                                                                        | 1,292,114 |                                                       |  | 0                                                 |   |       | 779,828   |                                                            |  | 512,286   |  |  | 1,292,114 |  |  | 42,472  |  | 2007
|ELLINGTON, CT        |  |                                                                        | 1,294,889 |                                                       |  | 0                                                 |   |       | 841,678   |                                                            |  | 453,211   |  |  | 1,294,889 |  |  | 75,533  |  | 2004
|LAKE HOPATCONG, NJ   |  |                                                                        | 1,305,034 |                                                       |  | 0                                                 |   |       | 800,000   |                                                            |  | 505,034   |  |  | 1,305,034 |  |  | 303,226 |  | 2000
|SAVONA, NY           |  |                                                                        | 1,314,135 |                                                       |  | 0                                                 |   |       | 964,136   |                                                            |  | 349,999   |  |  | 1,314,135 |  |  | 39,667  |  | 2006
|FILLMORE, CA         |  |                                                                        | 1,354,113 |                                                       |  | 0                                                 |   |       | 950,061   |                                                            |  | 404,052   |  |  | 1,354,113 |  |  | 37,786  |  | 2007
|KANEOHE, HI          |  |                                                                        | 1,363,901 |                                                       |  | 0                                                 |   |       | 821,691   |                                                            |  | 542,210   |  |  | 1,363,901 |  |  | 52,654  |  | 2007
|BELLFLOWER, CA       |  |                                                                        | 1,369,511 |                                                       |  | 0                                                 |   |       | 910,252   |                                                            |  | 459,259   |  |  | 1,369,511 |  |  | 43,108  |  | 2007
|WINDSOR LOCKS, CT    |  |                                                                        | 1,433,330 |                                                       |  | 0                                                 |   |       | 0         |                                                            |  | 1,433,330 |  |  | 1,433,330 |  |  | 597,221 |  | 2004
|VERNON, CT           |  |                                                                        | 1,434,223 |                                                       |  | 0                                                 |   |       | 0         |                                                            |  | 1,434,223 |  |  | 1,434,223 |  |  | 597,592 |  | 2004
|POWAY, CA            |  |                                                                        | 1,439,021 |                                                       |  | (0                                                | ) |       | 0         |                                                            |  | 1,439,021 |  |  | 1,439,021 |  |  | 114,467 |  | 2007
|PETERSBURG, VA       |  |                                                                        | 0         |                                                       |  | 1,441,374                                         |   |       | 816,374   |                                                            |  | 625,000   |  |  | 1,441,374 |  |  | 93,750  |  | 2005
|PERRY, NY            |  |                                                                        | 1,443,847 |                                                       |  | 0                                                 |   |       | 1,043,847 |                                                            |  | 400,000   |  |  | 1,443,847 |  |  | 45,333  |  | 2006
|BROOKLAND, AR        |  |                                                                        | 1,467,809 |                                                       |  | 0                                                 |   |       | 149,218   |                                                            |  | 1,318,591 |  |  | 1,467,809 |  |  | 56,442  |  | 2007
|NEW HAVEN, CT        |  |                                                                        | 1,412,860 |                                                       |  | 56,420                                            |   |       | 898,470   |                                                            |  | 570,810   |  |  | 1,469,280 |  |  | 281,917 |  | 1985
|MECHANICSVILLE, VA   |  |                                                                        | 0         |                                                       |  | 1,476,043                                         |   |       | 876,043   |                                                            |  | 600,000   |  |  | 1,476,043 |  |  | 90,000  |  | 2005
|BRICK, NJ            |  |                                                                        | 1,507,684 |                                                       |  | 0                                                 |   |       | 1,000,000 |                                                            |  | 507,684   |  |  | 1,507,684 |  |  | 247,725 |  | 2000
|WAIANAE, HI          |  |                                                                        | 1,520,144 |                                                       |  | 0                                                 |   |       | 648,273   |                                                            |  | 871,871   |  |  | 1,520,144 |  |  | 72,706  |  | 2007
|HALEIWA, HI          |  |                                                                        | 1,521,648 |                                                       |  | 0                                                 |   |       | 1,058,124 |                                                            |  | 463,524   |  |  | 1,521,648 |  |  | 53,621  |  | 2007
|MERIDEN, CT          |  |                                                                        | 1,531,772 |                                                       |  | 0                                                 |   |       | 989,165   |                                                            |  | 542,607   |  |  | 1,531,772 |  |  | 92,929  |  | 2004
|HONOLULU, HI         |  |                                                                        | 1,538,997 |                                                       |  | 0                                                 |   |       | 1,219,217 |                                                            |  | 319,780   |  |  | 1,538,997 |  |  | 28,955  |  | 2007
|HOOKSETT, NH         |  |                                                                        | 1,561,628 |                                                       |  | 0                                                 |   |       | 823,915   |                                                            |  | 737,712   |  |  | 1,561,628 |  |  | 115,904 |  | 2007
|BRISTOL, CT          |  |                                                                        | 1,594,129 |                                                       |  | 0                                                 |   |       | 1,036,184 |                                                            |  | 557,945   |  |  | 1,594,129 |  |  | 92,992  |  | 2004
|HESPERIA, CA         |  |                                                                        | 1,643,449 |                                                       |  | 0                                                 |   |       | 849,352   |                                                            |  | 794,097   |  |  | 1,643,449 |  |  | 68,660  |  | 2007
|MECHANICSVILLE, VA   |  |                                                                        | 0         |                                                       |  | 1,677,065                                         |   |       | 1,157,065 |                                                            |  | 520,000   |  |  | 1,677,065 |  |  | 78,000  |  | 2005
|KING WILLIAM, VA     |  |                                                                        | 0         |                                                       |  | 1,687,540                                         |   |       | 1,067,540 |                                                            |  | 620,000   |  |  | 1,687,540 |  |  | 93,000  |  | 2005
|HOUSTON, TX          |  |                                                                        | 1,688,904 |                                                       |  | 0                                                 |   |       | 223,664   |                                                            |  | 1,465,240 |  |  | 1,688,904 |  |  | 111,373 |  | 2007
|FREDERICKSBURG, VA   |  |                                                                        | 0         |                                                       |  | 1,715,914                                         |   |       | 995,914   |                                                            |  | 720,000   |  |  | 1,715,914 |  |  | 108,000 |  | 2005
|HONOLULU, HI         |  |                                                                        | 1,768,878 |                                                       |  | 0                                                 |   |       | 1,192,216 |                                                            |  | 576,662   |  |  | 1,768,878 |  |  | 48,078  |  | 2007
|ALLENSTOWN, NH       |  |                                                                        | 1,787,116 |                                                       |  | 0                                                 |   |       | 466,994   |                                                            |  | 1,320,122 |  |  | 1,787,116 |  |  | 119,762 |  | 2007
|LONG ISLAND CITY, NY |  |                                                                        | 1,646,307 |                                                       |  | 259,443                                           |   |       | 1,071,500 |                                                            |  | 834,250   |  |  | 1,905,750 |  |  | 507,752 |  | 1985

82

---



|                          |  |                                                                        |             |                                                       |   |                                                   |  |       |             |                                                            |   |             |  |   |             |  |   |             |  |     
|------------------------- |  | ---------------------------------------------------------------------- | ----------- | ----------------------------------------------------- | - | ------------------------------------------------- |  | ----- | ----------- | ---------------------------------------------------------- | - | ----------- |  | - | ----------- |  | - | ----------- |  | ----
|                          |  | Initial Cost
 of Leasehold
 or Acquisition
 Investment to
 Company (1) |             | Cost
 Capitalized
 Subsequent
 to Initial
 Investment |   | Gross Amount at Which Carried
 at Close of Period |  |       |             | Date of Initial
 Leasehold or
 Acquisition
 Investment (1)
|                          |  |                                                                        |             |                                                       |   |                                                   | 
|Description               |  |                                                                        |             | Land                                                  |   | Building and
 Improvements                        |  | Total |             | Accumulated
 Depreciation                                  |  
|                          |  |                                                                        |             |                                                       |   |                                                   |  |       |             |                                                            |   |             |  |   |             |  |   |             |  |     
|                         
|SAN DIMAS, CA             |  |                                                                        | 1,941,008   |                                                       |   | 0                                                 |  |       | 749,066     |                                                            |   | 1,191,942   |  |   | 1,941,008   |  |   | 94,544      |  | 2007
|SAN MARCOS, TX            |  |                                                                        | 1,953,653   |                                                       |   | 0                                                 |  |       | 250,739     |                                                            |   | 1,702,914   |  |   | 1,953,653   |  |   | 133,479     |  | 2007
|LA PALMA, CA              |  |                                                                        | 1,971,592   |                                                       |   | 0                                                 |  |       | 1,389,383   |                                                            |   | 582,210     |  |   | 1,971,592   |  |   | 53,595      |  | 2007
|KANEOHE, HI               |  |                                                                        | 1,977,671   |                                                       |   | 0                                                 |  |       | 1,473,275   |                                                            |   | 504,396     |  |   | 1,977,671   |  |   | 47,249      |  | 2007
|WAIANAE, HI               |  |                                                                        | 1,996,811   |                                                       |   | 0                                                 |  |       | 870,775     |                                                            |   | 1,126,036   |  |   | 1,996,811   |  |   | 94,383      |  | 2007
|SOUTH WINDHAM, CT         |  |                                                                        | 644,141     |                                                       |   | 1,397,938                                         |  |       | 598,394     |                                                            |   | 1,443,685   |  |   | 2,042,079   |  |   | 86,304      |  | 2004
|HARKER HEIGHTS, TX        |  |                                                                        | 2,051,704   |                                                       |   | 0                                                 |  |       | 588,320     |                                                            |   | 1,463,384   |  |   | 2,051,704   |  |   | 192,815     |  | 2007
|FT WORTH, TX              |  |                                                                        | 2,114,924   |                                                       |   | 0                                                 |  |       | 866,062     |                                                            |   | 1,248,863   |  |   | 2,114,924   |  |   | 112,417     |  | 2007
|RENSSELAER, NY            |  |                                                                        | 1,653,500   |                                                       |   | 514,444                                           |  |       | 1,076,800   |                                                            |   | 1,091,144   |  |   | 2,167,944   |  |   | 766,271     |  | 1985
|BENICIA, CA               |  |                                                                        | 2,223,362   |                                                       |   | 0                                                 |  |       | 1,057,519   |                                                            |   | 1,165,843   |  |   | 2,223,362   |  |   | 114,287     |  | 2007
|COACHELLA, CA             |  |                                                                        | 2,234,957   |                                                       |   | 0                                                 |  |       | 1,216,646   |                                                            |   | 1,018,312   |  |   | 2,234,957   |  |   | 93,082      |  | 2007
|BALTIMORE, MD             |  |                                                                        | 2,258,897   |                                                       |   | 0                                                 |  |       | 721,876     |                                                            |   | 1,537,022   |  |   | 2,258,897   |  |   | 125,569     |  | 2007
|BEDFORD, NH               |  |                                                                        | 2,301,297   |                                                       |   | 0                                                 |  |       | 1,271,171   |                                                            |   | 1,030,126   |  |   | 2,301,297   |  |   | 102,923     |  | 2007
|AUSTIN, TX                |  |                                                                        | 2,368,425   |                                                       |   | 0                                                 |  |       | 738,210     |                                                            |   | 1,630,215   |  |   | 2,368,425   |  |   | 130,764     |  | 2007
|TEMPLE, TX                |  |                                                                        | 2,405,953   |                                                       |   | 0                                                 |  |       | 1,215,488   |                                                            |   | 1,190,465   |  |   | 2,405,953   |  |   | 103,791     |  | 2007
|WAIPAHU, HI               |  |                                                                        | 2,458,592   |                                                       |   | 0                                                 |  |       | 945,327     |                                                            |   | 1,513,264   |  |   | 2,458,592   |  |   | 121,087     |  | 2007
|MONTPELIER, VA            |  |                                                                        | 0           |                                                       |   | 2,480,686                                         |  |       | 1,725,686   |                                                            |   | 755,000     |  |   | 2,480,686   |  |   | 113,250     |  | 2005
|KELLER, TX                |  |                                                                        | 2,506,573   |                                                       |   | 0                                                 |  |       | 996,029     |                                                            |   | 1,510,544   |  |   | 2,506,573   |  |   | 128,732     |  | 2007
|EAST PROVIDENCE, RI       |  |                                                                        | 2,297,435   |                                                       |   | 568,241                                           |  |       | 1,495,700   |                                                            |   | 1,369,976   |  |   | 2,865,676   |  |   | 666,885     |  | 1985
|JONESBORO, AR             |  |                                                                        | 2,985,267   |                                                       |   | 0                                                 |  |       | 330,322     |                                                            |   | 2,654,945   |  |   | 2,985,267   |  |   | 192,817     |  | 2007
|NEWARK, NJ                |  |                                                                        | 3,086,592   |                                                       |   | 164,432                                           |  |       | 2,005,800   |                                                            |   | 1,245,224   |  |   | 3,251,024   |  |   | 637,621     |  | 1985
|AUSTIN, TX                |  |                                                                        | 3,510,062   |                                                       |   | 0                                                 |  |       | 1,594,536   |                                                            |   | 1,915,526   |  |   | 3,510,062   |  |   | 155,432     |  | 2007
|FREDERICKSBURG, VA        |  |                                                                        | 0           |                                                       |   | 3,623,228                                         |  |       | 2,828,228   |                                                            |   | 795,000     |  |   | 3,623,228   |  |   | 119,250     |  | 2005
|WACO, TX                  |  |                                                                        | 3,884,407   |                                                       |   | 0                                                 |  |       | 894,356     |                                                            |   | 2,990,051   |  |   | 3,884,407   |  |   | 262,069     |  | 2007
|THE COLONY, TX            |  |                                                                        | 4,395,696   |                                                       |   | 0                                                 |  |       | 337,083     |                                                            |   | 4,058,613   |  |   | 4,395,696   |  |   | 300,138     |  | 2007
|HONOLULU, HI              |  |                                                                        | 9,210,707   |                                                       |   | 0                                                 |  |       | 8,193,984   |                                                            |   | 1,016,724   |  |   | 9,210,707   |  |   | 87,664      |  | 2007
|MISCELLANEOUS INVESTMENTS |  |                                                                        | 10,879,528  |                                                       |   | 12,876,458                                        |  |       | 6,453,867   |                                                            |   | 17,302,118  |  |   | 23,755,986  |  |   | 15,868,528  |  | 0   
|                          |  |                                                                        |             |                                                       |   |                                                   |  |       |             |                                                            |   |             |  |   |             |  |   |             |  |     
|                          |  | $                                                                      | 364,207,264 |                                                       | $ | 109,360,132                                       |  | $     | 221,540,125 |                                                            | $ | 252,027,271 |  | $ | 473,567,396 |  | $ | 129,322,033 |  |     
|                          |  |                                                                        |             |                                                       |   |                                                   |  |       |             |                                                            |   |             |  |   |             |  |   |             |  |     

|    |                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Initial cost of leasehold
 or acquisition investment to company represents the aggregate of the cost
 incurred during the year in which the company purchased the property for
 owned properties or purchased a leasehold interest in leased properties. Cost
 capitalized subsequent to initial investment also includes investments made
 in previously leased properties prior to their acquisition.
|    |                                                                                                                                                                                                                                                                                                                                                                                                        
|(2) | Depreciation of real
 estate is computed on the straight-line method based upon the estimated
 useful lives of the assets, which generally range from sixteen to twenty-five
 years for buildings and improvements, or the term of the lease if shorter.
 Leasehold interests are amortized over the remaining term of the underlying
 lease.                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                        
|(3) | The aggregate cost for
 federal income tax purposes was approximately $372,183,000 at December 31,
 2008.                                                                                                                                                                                                                                                                                              

83

---



SIGNATURES

Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, as amended, the Registrant has duly caused this Annual Report on Form
10-K to be signed on its behalf by the undersigned, thereunto duly authorized.

| |                     |                               
| | ------------------- | ------------------------------
| | Getty Realty
 Corp.
| | (Registrant)       
| |                     |                               
| | By:                 | /s/ Thomas
 J. Stirnweis      
| |                     |                               
| |                     | Thomas J.
 Stirnweis,         
| |                     | Vice
 President, Treasurer and
| |                     | Chief
 Financial Officer      
| |                     | March 2,
 2009                

Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, this
Annual Report on Form 10-K has been signed below by the following persons on
behalf of the Registrant and in the capacities and on the dates indicated.

|                                                |                     |                                                        |     |                         
|----------------------------------------------- | ------------------- | ------------------------------------------------------ | --- | ------------------------
|By:                                             | /s/ Leo
 Liebowitz  |                                                        | By: | /s/ Thomas
 J. Stirnweis
|                                                |                     |                                                        |     |                         
|Leo
 Liebowitz                                  |                     | Thomas J.
 Stirnweis                                  
|Chairman,
 Chief Executive Officer and Director |                     | Vice
 President, Treasurer and Chief Financial Officer
|(Principal
 Executive Officer)                  |                     | (Principal
 Financial and Accounting Officer)         
|March 2,
 2009                                  |                     | March 2,
 2009                                        
|                                                |                     |                                                        |     |                         
|By:                                             | /s/ Milton
 Cooper  |                                                        | By: | /s/ Philip
 E. Coviello 
|                                                |                     |                                                        |     |                         
|Milton
 Cooper                                  |                     | Philip E.
 Coviello                                   
|Director                                        |                     | Director                                              
|March 2,
 2009                                  |                     | March 2,
 2009                                        
|                                                |                     |                                                        |     |                         
|By:                                             | /s/ David
 Driscoll |                                                        | By: | /s/ Howard
 Safenowitz  
|                                                |                     |                                                        |     |                         
|David
 Driscoll                                 |                     | Howard
 Safenowitz                                    
|Director                                        |                     | Director                                              
|March 2,
 2009                                  |                     | March 2,
 2009                                        

84

---



EXHIBIT INDEX

GETTY REALTY CORP.
Annual Report on Form 10-K
for the year ended December 31, 2008

|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|------------ | ------ | ----------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|EXHIBIT
 NO. |        | DESCRIPTION |                                                                                                                                                                                                                        | 
|             |        |             |                                                                                                                                                                                                                        | 
|             | 2.1    |             | Agreement
 and Plan of Reorganization and Merger, dated as of December 16, 1997 (the
 Merger Agreement) by and among Getty Realty Corp., Power Test Investors
 Limited Partnership and CLS General Partnership Corp. |  | Filed as
 Exhibit 2.1 to Companys Registration Statement on Form S-4, filed on January
 12, 1998 (File No. 333-44065), included as Appendix A To the Joint Proxy
 Statement/Prospectus that is a part thereof, and incorporated herein by
 reference. 
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 3.1    |             | Articles of
 Incorporation of Getty Realty Holding Corp. (Holdings), now known as Getty
 Realty Corp., filed December 23, 1997.                                                                                      |  | Filed as Exhibit 3.1 to Companys Registration Statement on Form S-4, filed on January 12, 1998 (File No. 333-44065), included as Appendix D to the Joint Proxy Statement/Prospectus that is a part thereof, and incorporated herein by reference.     
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 3.2    |             | Articles
 Supplementary to Articles of Incorporation of Holdings, filed January 21,
 1998.                                                                                                                             |  | (a)                                                                                                                                                                                                                                                    
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 3.3    |             | By-Laws of
 Getty Realty Corp.                                                                                                                                                                                         |  | (a)                                                                                                                                                                                                                                                    
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 3.4    |             | Articles of
 Amendment of Holdings, changing its name to Getty Realty Corp., filed January
 30, 1998.                                                                                                                  |  | (a)                                                                                                                                                                                                                                                    
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 3.5    |             | Amendment to
 Articles of Incorporation of Holdings, filed August 1, 2001.                                                                                                                                             |  | (a)                                                                                                                                                                                                                                                    
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 4.1    |             | Dividend
 Reinvestment/Stock Purchase Plan.                                                                                                                                                                            |  | Filed under
 the heading Description of Plan on pages 4 through 17 to Companys
 Registration Statement on Form S-3D, filed on April 22, 2004 (File
 No.333-114730) and incorporated herein by reference.                                            
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 10.1*  |             | Retirement
 and Profit Sharing Plan (amended and restated as of January 1, 2002), adopted by
 the Company on September 3, 2002.                                                                                        |  | (a)                                                                                                                                                                                                                                                    
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 10.2*  |             | 1998 Stock
 Option Plan, effective as of January 30, 1998.                                                                                                                                                             |  | Filed as
 Exhibit 10.1 to Companys Registration Statement on Form S-4, filed on
 January 12, 1998 (File No. 333-44065), included as Appendix H to the Joint Proxy
 Statement/Prospectus that is a part thereof, and incorporated herein by
 reference.
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 10.3** |             | Asset
 Purchase Agreement among Power Test Corp. (now known as Getty Properties
 Corp.), Texaco Inc., Getty Oil Company and Getty Refining and Marketing Company,
 dated as of December 21, 1984.                      |  | (a)                                                                                                                                                                                                                                                    
|             |        |             |                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                        
|             | 10.4   |             | Assignment
 of Trademark Registrations                                                                                                                                                                                 |  | Filed as
 Exhibit 10.4 to Companys Annual Report on Form 10-K for the fiscal year
 ended January 31, 2007 (File No. 001-13777) and incorporated
 herein by reference.                                                                                 

85

---



| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | ------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.5*   |  | Form of
 Indemnification Agreement between the Company and its directors.                                                                                                                                                      |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.6*   |  | Amended and
 Restated Supplemental Retirement Plan for Executives of the Getty Realty
 Corp. and Participating Subsidiaries (adopted by the Company on December 16,
 1997 and amended and restated effective January 1, 2009). |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.7*   |  | Letter Agreement dated June 12, 2001 by and
 between Getty Realty Corp. and Thomas J. Stirnweis regarding compensation
 upon change in control.                                                                                |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.8    |  | Form of
 Reorganization and Distribution Agreement between Getty Petroleum Corp. (now
 known as Getty Properties Corp.) and Getty Petroleum Marketing Inc. dated as
 of February 1, 1997.                                      |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.9    |  | Form of Tax
 Sharing Agreement between Getty Petroleum Corp (now known as Getty.
 Properties Corp.) and Getty Petroleum Marketing Inc.                                                                                         |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.10   |  | Consolidated,
 Amended and Restated Master Lease Agreement dated November 2, 2000 between
 Getty Properties Corp. and Getty Petroleum Marketing Inc.                                                                           |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.11   |  | Environmental
 Indemnity Agreement dated November 2, 2000 between Getty Properties Corp. and
 Getty Petroleum Marketing Inc.                                                                                                   |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.12   |  | Amended and
 Restated Trademark License Agreement, dated November 2, 2000, between Getty
 Properties Corp. and Getty Petroleum Marketing Inc.                                                                                  |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.13   |  | Trademark
 License Agreement, dated November 2, 2000, between Getty Corp. and Getty
 Petroleum Marketing Inc.                                                                                                                 |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.14*  |  | 2004 Getty
 Realty Corp. Omnibus Incentive Compensation Plan.                                                                                                                                                                  |  | Filed as
 Appendix B to the Definitive Proxy Statement of Getty Realty Corp., filed
 April 9, 2004 (File No. 001-13777) and incorporated herein by reference.       
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.15*  |  | Form of
 restricted stock unit grant award under the 2004 Getty Realty Corp. Omnibus
 Incentive Compensation Plan, as amended.                                                                                                 |  | (a)                                                                                                                                                                 
| |         |  |                                                                                                                                                                                                                                |  |                                                                                                                                                                     
| | 10.16** |  | Contract for
 Sale and Purchase between Getty Properties Corp. and various subsidiaries of
 Trustreet Properties, Inc. dated as of February 6, 2007.                                                                           |  | Filed as
 Exhibit 10.20 to the Companys Annual Report on Form 10-K for the year ended
 December 31, 2006 (File No. 001-13777) and incorporated herein by reference.

86

---



| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | ------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.17   |  | Senior
 Unsecured Credit Agreement dated as of March 27, 2007 with J. P. Morgan
 Securities Inc., as sole bookrunner and sole lead arranger, the lenders
 referred to therein, and JPMorgan Chase Bank, N.A., as administrative agent
 for the lenders. |  | Filed as
 Exhibit 10.1 to the Companys Current Report on Form 8-K filed April 2, 2007
 (File No. 001-13777) and incorporated herein by reference.           
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 10.18*  |  | Severance
 Agreement and General Release by and between Getty Realty Corp. and Andrew M.
 Smith effective October 31, 2007 and dated November 13, 2007.                                                                                                 |  | Filed as
 Exhibit 10.22 to the Companys Current Report on Form 8-K filed November 14,
 2007 (File No. 001-13777) and incorporated herein by reference.      
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 10.19*  |  | Amendment to
 the 2004 Getty Realty Corp. Omnibus Incentive Compensation Plan dated
 December 31, 2008.                                                                                                                                                 |  | (a)                                                                                                                                                          
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 10.20*  |  | Amendment dated December 31, 2008 to Letter Agreement dated June 12, 2001 by and between Getty Realty Corp. and Thomas J. Stirnweis regarding compensation upon change of control. (See Exhibit 10.7).                                                  |  | (a)                                                                                                                                                          
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 14      |  | The Getty
 Realty Corp. Business Conduct Guidelines (Code of Ethics).                                                                                                                                                                                   |  | Filed as
 Exhibit 14 to Companys Annual Report on Form 10-K for the year ended
 December 31, 2003 (File No. 001-13777) and incorporated herein by reference.
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 21      |  | Subsidiaries
 of the Company.                                                                                                                                                                                                                           |  | (a)                                                                                                                                                          
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 23      |  | Consent of
 Independent Registered Public Accounting Firm.                                                                                                                                                                                              |  | (a)                                                                                                                                                          
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 31(i).1 |  | Rule
 13a-14(a) Certification of Chief Financial Officer.                                                                                                                                                                                               |  | (b)                                                                                                                                                          
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 31(i).2 |  | Rule
 13a-14(a) Certification of Chief Executive Officer.                                                                                                                                                                                               |  | (b)                                                                                                                                                          
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 32.1    |  | Section 1350
 Certification of Chief Executive Officer.                                                                                                                                                                                                 |  | (b)                                                                                                                                                          
| |         |  |                                                                                                                                                                                                                                                         |  |                                                                                                                                                              
| | 32.2    |  | Section 1350
 Certification of Chief Financial Officer.                                                                                                                                                                                                 |  | (b)                                                                                                                                                          

|    |                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(a) | Filed
 herewith                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                         
|(b) | Furnished
 herewith. These certifications are being furnished solely to accompany the
 Report pursuant to 18 U.S.C. Section. 1350, and are not being filed for
 purposes of Section 18 of the Exchange Act, and are not to be incorporated by
 reference into any filing of the Company, whether made before or after the
 date hereof, regardless of any general incorporation language in such filing.
|    |                                                                                                                                                                                                                                                                                                                                                                                                         
|*   | Management
 contract or compensatory plan or arrangement.                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                         
|**  | Confidential
 treatment has been granted for certain portions of this Exhibit pursuant to
 Rule 24b-2 under the Exchange Act, which portions are omitted and filed
 separately with the SEC.                                                                                                                                                                                                            

87

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