CLASS D
MORTGAGE NOTE


$8,500,000                                     New York, New York
                                                    June 18, 1996


                      W I T N E S S E T H:

               FOR VALUE RECEIVED, the undersigned, collectively,
as maker ("Borrower"), promises to pay to the order of KRT
Origination Corp., having an office c/o Kranzco Realty Corp., 128
Fayette Street, Conshohocken, Pennsylvania  19428, as payee
("Lender"), the principal sum of Eight Million Five Hundred
Thousand and no/100 Dollars ($8,500,000), less any payments of
principal (each, a "Prepayment") made thereon from time to time
(the "Principal Amount"), with interest on such Principal Amount
as hereinafter provided.  All payments due from Borrower pursuant
to the terms of this Mortgage Note or any other Loan Document
shall be paid into the Collection Account (as hereinafter
defined), or as otherwise directed by Lender from time to time,
on the applicable Due Date (as hereafter defined).  This Mortgage
Note is one of four notes secured by (a) an Indenture of
Mortgage, Deed of Trust, Security Agreement, Financing Statement,
Fixture Filing and Assignment of Leases, Rents and Security
Deposits, dated as of the date hereof (the "Mortgage"), securing
a first mortgage lien upon the Trust Estate (as defined in the
Mortgage), made by Borrower, as grantor, in favor of Lender, as
beneficiary, (b) an Assignment of Leases, Rents and Security
Deposits, dated as of the date hereof (the "Assignment"), made by
Borrower, as assignor, in favor of Lender, as assignee, and (c)
all of the other Loan Documents.  All capitalized terms used but
not otherwise defined herein shall have the respective meanings
ascribed thereto in the Mortgage.  

          1.   Interest and Principal Payments.  Interest on the
outstanding principal balance of this Mortgage Note shall accrue
at the rate of Eight and Ninety-Six Hundredths (8.96%) percent
per annum (the "Interest Rate") (in the event of an Event of
Default, payment of an additional amount equal to interest at the
Default Rate (as hereinafter defined) on the outstanding
principal amount of this Mortgage Note shall also be due for each
Interest Accrual Period during any part of which such Event of
Default continues in accordance with the provisions of Paragraph
3 hereof).  Interest at the Interest Rate shall be payable in
equal monthly installments in arrears (each such monthly payment
being an "Interest Installment") of $63,466.67 (except in the
case of the Interest Installment due July 16, 1996, which shall
be equal to $67,697.78) on or before 12:00 noon, Eastern Standard
Time, on the fourth (4th) Business Day prior to the twentieth
(20th) day of each calendar month or if such 20th day is not a
Business Day, the next succeeding Business Day (the "Due Date")
during the term hereof, commencing on July 16, 1996 until the
Maturity Date (as hereinafter defined) or otherwise.  Interest
shall be computed on the basis of a 360-day year consisting of
twelve (12) months of thirty (30) days each, and thirty (30)
days' interest shall be paid on each Due Date and shall accrue
from and including each Due Date to but not including the next
succeeding Due Date, except with respect to the Due Date on
July 16, 1996 on which thirty-two (32) days' interest shall be
paid.  The entire outstanding principal balance of this Mortgage
Note, together with all accrued but unpaid interest hereon, shall
be due and payable to Lender on the Due Date in June, 2003 (the
"Maturity Date") or on such earlier date as may be required under
the terms of this Mortgage Note.  All payments hereunder shall be
made by wire transfer of immediately available funds into an
account designated by Lender (the "Collection Account") in
accordance with the Cash Collateral Agreement.  In the event of
any prepayment pursuant to the provisions of Paragraphs 4 or 5
hereof, the amount of the Interest Installment shall be adjusted
to reflect such prepayment.

          2.   Definitions.  As used herein, the following terms
shall have the following meanings:  

          (a)  Mandatory Prepayment:  As defined in Paragraph 5
hereof.

          (b)  Servicer:  GE Capital Asset Management
Corporation.

          (c)  Voluntary Prepayment:  As defined in Paragraph 6
hereof.

          (d)  Other Notes:  means the three mortgage notes (the
"Class A Note," the "Class B Note" and the "Class C Note"), each
dated as of the date hereof, executed by Borrower for the benefit
of Lender, in the outstanding principal amounts of $123,700,000,
$20,600,000 and $28,900,000, respectively; the Class A Note, the
Class B and the Class C Note are also secured by the Mortgage.

          (e)  Interest Accrual Period:  means the period
commencing on (and including) the 20th day of each calendar month
(except with respect to the initial Interest Accrual Period which
shall commence on (and include) the date hereof) and ending on
(but excluding) the 20th day of the immediately succeeding
calendar month.

          3.   Default Rate.  In the event that there occurs and
is continuing an Event of Default, then, and in addition to
Lender's rights set forth in Paragraph 7 hereof, additional
interest ("Default Interest") shall accrue on the outstanding
principal amount of this Mortgage Note, as of the first day of
the Interest Accrual Period in which such Event of Default occurs
and through the last day of the Interest Accrual Period in which
such Event of Default is cured, at a rate equal to three percent
(3%) per annum (the "Default Rate").  If interest payable
pursuant to the Default Rate is deemed to be interest in excess
of the Maximum Amount (as hereinafter defined), the amount
actually collected by Lender in excess of such amount shall be
applied in accordance with the provisions of Paragraphs 11 and 12
hereof.

          4.   Voluntary Prepayment.  (a)  Prior to the Due Date
in May, 2003, Borrower may not prepay the Principal Amount in
whole or in part.  From and after such Due Date, and provided no
Event of Default shall have occurred and be continuing, Borrower
may prepay the Principal Amount, in whole or in part (an
"Voluntary Prepayment"), on any Due Date, upon not less than
thirty (30) days prior written notice to Lender, which notice
shall specify the Due Date on which such Prepayment shall be
made, the amount of the Prepayment, and shall be irrevocable, but
only upon the payment of the Prepayment Amount (as hereinafter
defined).

          (b)  The prepayment amount (the "Prepayment Amount")
shall be equal to the sum of (i) the amount of the Principal
Amount being prepaid, and (ii) all accrued and unpaid interest
through the Due Date of the Interest Installment period in which
such Voluntary Prepayment is made.

          (c)  Any Principal Amount prepaid pursuant to the
provisions of Section 38(b) of the Mortgage shall be applied
first to the Other Notes until each of the same is repaid in
full, then to this Mortgage Note until the same is repaid in
full.  Any other Principal Amount prepaid by Borrower pursuant to
this Paragraph 4 shall be applied to this Mortgage Note and/or
the Other Notes in such manner as Borrower shall specify at the
time.

          (d)  Any Principal Amount of this Mortgage Note prepaid
pursuant to the provisions of this Paragraph 4 may not be
reborrowed hereunder.

          5.   Mandatory Prepayment.  (a)  Following certain
events of casualty or condemnation, Borrower is required,
pursuant to Section 6 of the Mortgage, to repay the Principal
Amount (the "Mandatory Prepayment") to the extent of the
applicable insurance or condemnation proceeds, without premium or
penalty, upon the Due Date next succeeding the date such proceeds
become available for prepayment.

          (b)  Any Mandatory Prepayment shall be applied first to
the Other Notes until each of the same is repaid in full, and
then to this Mortgage Note until the same is repaid in full.

          (c)  Any Principal Amount of this Mortgage Note prepaid
pursuant to this Paragraph 6 may not be reborrowed hereunder.

          6.   Application of Funds.  Subject to the provisions
of Paragraphs 11 and 12 hereof, all payments received by Lender
on the Mortgage Notes shall be applied first, to accrued interest
(other than Default Interest) on the Class A Note, the Class B
and the Class C Note, in that order; second, to interest on this
Mortgage Note; third, to reduce the principal amount of the Class
A Note, the Class B and the Class C Note, in that order to zero;
fourth, to reduce to zero the principal amount of this Mortgage
Note; fifth, to reimburse Lender for expenses payable to Lender
and its assignees pursuant to Paragraph 8 hereof in connection
with the enforcement of this Mortgage Note and the other Loan
Documents; and sixth, to Default Interest.

          7.   Events of Default.  The occurrence and continuance
of an Event of Default (as defined in the Mortgage) shall
constitute an "Event of Default" hereunder.  Upon the occurrence
and continuance of an Event of Default, Lender may, at its
option, declare all or any portion of the unpaid principal
balance of this Mortgage Note, together with all accrued and
unpaid interest hereon, and all other amounts payable hereunder,
to be immediately due and payable and thereby accelerate the
maturity hereof, and Lender may proceed to exercise any rights or
remedies that it may have under this Mortgage Note or such other
rights and remedies which Lender, subject to Paragraph 14 hereof,
may have at law, equity or otherwise.

          8.   Lender's Costs and Expenses.  Borrower shall pay
all costs and expenses of Lender, in addition to principal,
interest and Default Interest (if applicable), in connection with
(a) its performance of its obligations and exercise of its rights
under the Mortgage, this Mortgage Note and the other Loan
Documents, (b) the review of any Tax Opinion, Nondisqualification
Opinion, or other Opinion of Counsel delivered by Borrower
pursuant to the Mortgage or the other Loan Documents, and (c) the
servicing and monitoring of this Mortgage Note and the Mortgage. 
Borrower shall also pay all costs and expenses of collection of
Lender in connection with this Mortgage Note, in addition to
principal, interest and Default Interest (if applicable)
including, without limitation, reasonable attorneys' fees and
disbursements and other reasonable costs and expenses incurred by
Lender upon the occurrence and during the continuance of an Event
of Default in connection with the pursuit by Lender of any of its
rights or remedies referred to herein or the protection of or
realization of collateral or in connection with any of Lender's
collection efforts or any advances made by any advancing agent
pursuant to the Trust and Servicing Agreement, whether or not
suit on this Mortgage Note, on any of the other Loan Documents or
any foreclosure proceeding is filed.  All such costs and expenses
shall be payable as provided in the Trust and Servicing Agreement
upon Borrower's receipt of a statement therefor from Lender and
also shall be secured by the Mortgage and the other Loan
Documents.

          9.   No Waivers.  No failure on the part of Lender to
exercise any right or remedy hereunder, whether before or after
the happening of a default, shall constitute a waiver of such
default, any future default or of any other default.  No failure
to accelerate the debt evidenced hereby by reason of an Event of
Default, or acceptance of a past due installment, or indulgence
granted from time to time shall be construed to be a waiver of
the right to insist upon prompt payment, nor shall it be deemed
to be a novation of this Mortgage Note or as a reinstatement of
the debt evidenced hereby or as a waiver of such right of
acceleration or any other right, nor be construed so as to
preclude the exercise of any right which Lender may have, at law
or in equity, and, subject to the provisions of Paragraph 14
hereof, Borrower hereby expressly waives the benefit of any
statute or rule of law or equity which would produce a result
contrary to or be in conflict with the foregoing.  This Mortgage
Note may not be changed orally, but only by an agreement in
writing signed by the party against whom such agreement is sought
to be enforced.

          10.  Borrower's Waiver of Rights.  Borrower, for itself
and its successors and assigns, hereby waives presentment,
protest, demand, diligence, notice of dishonor and of nonpayment,
and waives and renounces all rights to the benefits of any
statute of limitations and any moratorium, appraisement, and
exemption now provided or which may hereafter be provided by any
federal or state statute, law, rule or regulation, including but
not limited to, exemptions provided by or allowed under any
federal or state bankruptcy or insolvency laws, both as to itself
and as to all of its property, whether real or personal, against
the enforcement and collection of the obligations evidenced by
this Mortgage Note and any and all extensions, renewals and
modifications hereof.

          11.  Maximum Interest Rate.  It is the intention of the
parties to conform strictly to the usury and other laws relating
to interest from time to time in force, and this Mortgage Note is
hereby expressly limited so that in no contingency or event
whatsoever, whether by acceleration of maturity hereof or
otherwise, shall the amount paid or agreed to be paid to Lender,
or collected by Lender or for the use, forbearance or detention
of the money to be loaned hereunder or otherwise, or for the
payment or performance of any covenant or obligation contained
herein, exceed the maximum amount permissible under applicable
usury or other laws of similar import (the "Maximum Amount").  If
under any circumstances whatsoever fulfillment of any provision
hereof at the time performance of such provision shall be due,
shall involve transcending the Maximum Amount, then ipso facto,
the obligation to be fulfilled shall be reduced to the Maximum
Amount.  For the purposes of calculating the actual amount of
interest paid and/or payable hereunder, in respect of laws
pertaining to usury or laws of similar import, all sums paid or
agreed to be paid to the holder hereof for the use, forbearance
or detention of the indebtedness of Borrower evidenced hereby,
outstanding from time to time shall, to the extent permitted by
applicable law, be amortized, prorated, allocated and spread from
the date of disbursement of the proceeds of this Mortgage Note,
until payment in full of all of such indebtedness, so that the
actual rate of interest on account of such indebtedness is
uniform through the term hereof.  Subject to the terms of
Paragraph 14 hereof, the terms and provisions of this Paragraph
11 and Paragraph 12 hereof shall control and supersede every
other provision of all agreements between Borrower and Lender.

          12.  Excess Interest Payments.  If under any
circumstances Lender shall ever receive an amount deemed interest
by applicable law, which would exceed the Maximum Amount, such
amount that would be excessive interest under applicable usury
laws or laws of similar import shall be applied by Lender in
payment of the Principal Amount until such time as the interest
rate decreases below the Maximum Amount.

          13.  Governing Law.  (a)  This Mortgage Note and the
obligations arising hereunder shall be governed by, and construed
in accordance with, the laws of the State of New York applicable
to contracts made and performed in such State and any applicable
law of the United States of America.  To the fullest extent
permitted by law, Borrower hereby unconditionally and irrevocably
waives any claim to assert that the law of any other jurisdiction
governs this Mortgage Note and this Mortgage Note shall be
governed by and construed in accordance with the laws of the
State of New York pursuant to Section 5-1401 of the New York General
Obligations Law.

          (b)  To the extent permitted by law, any legal suit,
action or proceeding against Lender arising out of or relating to
this Mortgage Note shall be, and any legal suit, action or
proceeding against Borrower on this Mortgage Note may be,
instituted in any federal or state court in New York, New York,
pursuant to Section 5-1402 of the New York General Obligations Law, and
Borrower waives any objection which it may now or hereafter have
to the laying of venue of any such suit, action or proceeding and
Borrower hereby irrevocably submits to the jurisdiction of any
such court in any suit, action or proceeding.  Borrower does
hereby designate and appoint Robinson Silverman Pearce Aronsohn &
Berman LLP as its authorized agent to accept and acknowledge on
its behalf service of any and all process which may be served in
any such suit, action or proceeding in any federal or state court
in New York, New York, and agrees that service of process upon
said agent at said address and written notice of said service of
Borrower mailed or delivered to Borrower in the manner provided
in the Mortgage, shall be deemed in every respect effective
service of process upon Borrower, in any such suit, action or
proceeding in the State of New York.  Borrower (i) shall give
prompt notice to the Lender of any changed address of its
authorized agent hereunder, (ii) may at any time and from time to
time designate a substitute authorized agent with an office in
New York, New York (which office shall be designated as the
address for service of process), and (iii) shall promptly
designate such a substitute if its authorized agent ceases to
have an office in New York, New York or is dissolved without
leaving a successor.

          14.  Non-Recourse.  Notwithstanding anything in this
Mortgage Note and except to the extent expressly set forth in
Section 33 and 41 of the Mortgage, no personal liability shall be
asserted or enforceable against (i) Borrower, (ii) any Direct
Beneficial Owner, (iii) any Affiliate of Borrower or any Direct
Beneficial Owner, (iv) any Person owning directly or indirectly,
any legal or beneficial interest in Borrower, any Direct
Beneficial Owner or any Affiliate of Borrower or any Direct
Beneficial Owner, or (v) any partner, principal, officer,
controlling person, beneficiary, trustee, advisor, shareholder,
employee, agent, Affiliate or director of any Persons described
in clauses (i) through (iv) above (collectively, the "Exculpated
Parties") by Lender in respect of this Mortgage Note, the
Mortgage or the other Loan Documents or the making, issuance or
transfer thereof, all such liability, if any, being expressly
waived by Lender and each successive holder of this Mortgage Note
upon the express condition of this provision and limitation that
in the case of the occurrence and continuance of an Event of
Default, Lender's remedies in its sole discretion shall be any or
all of:

               (i)  Foreclosure of the lien of the Mortgage in
     accordance with the terms and provisions set forth in the
     Mortgage;

               (ii) Action against any other security at any time
     given to secure the payment of this Mortgage Note and under
     the other Loan Documents; and

               (iii)  Exercise of any other remedy set forth in
     the Mortgage or any other Loan Document.

          The lien of any judgment against Borrower and any
proceeding instituted on, under or in connection with this
Mortgage Note, the Mortgage or the other Loan Documents shall not
extend to any property now or hereafter owned by Borrower or any
of the Exculpated Parties other than the Net Operating Income
from, and the ownership interest of Borrower in, the Trust Estate
and the other security for the payment of this Mortgage Note.

          15.  Legal Relationship.  Borrower and Lender intend
that the relationship created under this Mortgage Note be solely
that of debtor and creditor.  Nothing herein is intended to
create a joint venture, partnership, tenancy-in-common or joint
tenancy relationship between Borrower and Lender.

          16.  Assignment.  The parties hereto acknowledge that
immediately following the execution and delivery of this Mortgage
Note, the Mortgage and the other Loan Documents, Lender intends
to sell, transfer and assign this Mortgage Note, the Mortgage and
the other Loan Documents to State Street Bank and Trust Company,
as Trustee.  All references to "Lender" hereunder shall be deemed
to include the assigns of the Lender.

          17.  Waiver of Jury Trial.  Borrower hereby waives and
shall to the extent permitted by law waive trial by jury in any
action or proceeding brought by or counterclaim, other than a
compulsory counterclaim, asserted by Lender which action,
proceeding or counterclaim arises out of or is connected with
this Mortgage Note.

          IN WITNESS WHEREOF, each Borrower has executed this
instrument by its respective duly authorized officer or signatory
on the date first above written.

                              BORROWERS:

                              KRT PROPERTY HOLDINGS, INC.


                              By: /s/ Robert Dennis              
                                 Name:  Robert Dennis
                                 Title: Vice President



                              HILLCREST PLAZA LIMITED PARTNERSHIP


                              By:  KR Hillcrest, Inc.

                              
                                 By: /s/ Robert Dennis           
                                    Name:  Robert Dennis
                                    Title: Vice President


                              KR SUBURBAN, L.P.


                              By:  KR Suburban, Inc.


                                 By: /s/ Robert Dennis
                                     ---------------------
                                    Name:  Robert Dennis   
                                    Title: Vice President 


                              FOX RUN, LIMITED PARTNERSHIP


                              By:  KR Fox Run, Inc.


                                 By: /s/ Robert Dennis
                                     ---------------------
                                    Name:  Robert Dennis   
                                    Title: Vice President 



                              KR MacARTHUR ASSOCIATES, L.P.


                              By:  KR MacArthur, Inc.


                                 By: /s/ Robert Dennis
                                     ---------------------
                                    Name:  Robert Dennis   
                                    Title: Vice President 


                              KR BEST ASSOCIATES, L.P.


                              By:  KR Best Associates, Inc.


                                   By: /s/ Robert Dennis
                                     ---------------------
                                      Name:  Robert Dennis   
                                      Title: Vice President 


                              KR 69TH STREET, L.P.


                              By:  KR 69th Street, Inc.


                                 By: /s/ Robert Dennis
                                     ---------------------
                                    Name:  Robert Dennis   
                                    Title: Vice President 


                              KR TRUST ONE, INC.


                              By: /s/ Robert Dennis              
                                  ---------------------
                                 Name:  Robert Dennis
                                 Title: Vice President



                              KR MANCHESTER, INC.


                              By: /s/ Robert Dennis
                                ---------------------
                                 Name:  Robert Dennis   
                                 Title: Vice President 



                              KR STREET ASSOCIATES, L.P.


                              By:  KR Street, Inc.


                                 By: /s/ Robert Dennis
                                     ---------------------
                                    Name:  Robert Dennis
                                    Title: Vice President



                              KR ORANGE, INC.


                              By: /s/ Robert Dennis              
                                  ---------------------
                                 Name:  Robert Dennis
                                 Title: Vice President



                              KR COLLEGETOWN, INC.


                              By: /s/ Robert Dennis
                                  ---------------------
                                 Name:  Robert Dennis
                                 Title: Vice President



                              KR HILLCREST MALL, INC.


                              By: /s/ Robert Dennis
                                  ---------------------
                                 Name:  Robert Dennis
                                 Title: Vice President



                              KR PILGRIM, L.P.


                              By:  KR Pilgrim, Inc.


                                   By: /s/ Robert Dennis
                                     ---------------------
                                      Name:  Robert Dennis
                                      Title: Vice President

Pay to the order of
State Street Bank & Trust Company,
as Trustee, without recourse

By:  KRT ORIGINATION CORP.

By: /s/ Norman Kranzdorf      
    ----------------------
   Name:  Norman Kranzdorf
   Title: President