**SECURITIES AND EXCHANGE COMMISSION**

**Washington,DC  20549**

**FORM 10-K**

**x**                              ANNUALREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934

**Forthe fiscal year ended December 31, 2006**

**OR**

**o**                                 TRANSITIONREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

**Forthe transition period from                             to                                        **

**CommissionFile Number 1-12244**

**NEW PLAN EXCEL REALTY TRUST, INC.**

(Exact Name of Registrantas Specified in Its Charter)

| **Maryland**                                         |   | **33-0160389**                                             |
|------------------------------------------------------|--------|------------------------------------------------------------|
| (State of  Incorporation)                            |   | (I.R.S. Employer  Identification No.)                      |
| **420 Lexington Avenue**                             |   |                                                       |
| **New  York, NY 10170**                              |   | **(212)  869-3000**                                        |
| (Address of  Principal Executive Offices) (Zip Code) |   | (Registrant’s  Telephone Number, Including Area Code) |

 

Securities registeredpursuant to Section 12(b) of the Act:
|                                                      | Title of Each Class |                     |   |   | Name of Each Exchange on  Which Registered |   |
|------------------------------------------------------|---------------------|--------------------------|--------|--------|--------------------------------------------|--------|
| Common  Stock, $0.01 par value per share             |                | New  York Stock Exchange |
| Series E  Cumulative Redeemable Preferred Stock |                | New York Stock  Exchange |

 

Securitiesregistered pursuant to Section 12(g) of the Act:  **None**

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

Indicate by check mark if the Registrant is notrequired to file reports pursuant to Section 13 or Section 15(d) ofthe Securities Exchange Act of 1934.   Yes o   No x

Indicate by check mark whether the Registrant (1) hasfiled all reports required to be filed by Section 13 or 15(d) of the SecuritiesExchange Act of 1934 during the preceding 12 months and (2) has been subject tosuch filing requirements for the past 90 days.   Yes x   No o

Indicate by check mark if disclosure of delinquentfilers pursuant to Item 405 of Regulation S-K is not contained herein, and willnot be contained, to the best of Registrant’s knowledge, in definitive proxy orinformation statements incorporated by reference in Part III of this Form 10 Kor any amendment to this Form 10 K. o

Indicate by check mark whether the Registrant is alarge accelerated filer, an accelerated filer, or a non-accelerated filer. Seedefinition of “accelerated filer and large accelerated filer” in Rule 12b-2of the Exchange Act. (Check one):

Large AcceleratedFiler x      Accelerated Filer o      Non-Accelerated Filer o

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

The aggregate market value of the Registrant’s sharesof common stock held by non-affiliates was approximately $2,508,098,812 as of June 30,2006, based on the closing price of $24.69 on the New York Stock Exchange onthat date.

As of February 21, 2007, the number of shares ofcommon stock of the Registrant outstanding was 103,496,084.

Documents incorporated byreference:  Portions of the ProxyStatement for the 2007 Annual Meeting of Stockholders of the Registrant to befiled subsequently with the SEC are incorporated by reference intoPart III of this report.

 

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**TABLE OF CONTENTS**

|                   | ** ** | ** **                                                                                                              | ** ** | **Page** |
|-------------------|------------|-------------------------------------------------------------------------------------------------------------------------|------------|----------|
| **PART I**   |       |                                                                                                                    |       |     |
| Item 1.           |       | Business                                                                                                                |       | 4        |
| Item 1A.          |       | Risk  Factors                                                                                                           |       | 11       |
| Item 1B.          |       | Unresolved Staff Comments                                                                                               |       | 21       |
| Item 2.           |       | Properties                                                                                                              |       | 22       |
| Item 3.           |       | Legal  Proceedings                                                                                                      |       | 24       |
| Item 4.           |       | Submission of Matters to a Vote of Security Holders                                                                     |       | 24       |
| **PART II**  |       |                                                                                                                    |       |     |
| Item 5.           |       | Market for Registrant’s Common Equity, Related  Stockholder Matters and Issuer Purchases of Equity Securities |       | 25       |
| Item  6.          |       | Selected  Financial Data                                                                                                |       | 27       |
| Item 7.           |       | Management’s Discussion and Analysis of Financial  Condition and Results of Operations                   |       | 28       |
| Item 7A.          |       | Quantitative and Qualitative Disclosures About Market  Risk                                                             |       | 54       |
| Item 8.           |       | Financial Statements and Supplementary Data                                                                             |       | 55       |
| Item 9.           |       | Changes in and Disagreements with Accountants on  Accounting and Financial Disclosure                              |       | 55       |
| Item 9A.          |       | Controls and Procedures                                                                                                 |       | 55       |
| Item  9B.         |       | Other  Information                                                                                                      |       | 56       |
| **PART III** |       |                                                                                                                    |       |     |
| Item 10.          |       | Directors, Executive Officers and Corporate Governance                                                                  |       | 57       |
| Item 11.          |       | Executive Compensation                                                                                                  |       | 57       |
| Item 12.          |       | Security Ownership of Certain Beneficial Owners and  Management and Related Stockholder Matters                    |       | 57       |
| Item 13.          |       | Certain Relationships and Related Transactions, and  Director Independence                                              |       | 58       |
| Item 14.          |       | Principal Accountant Fees and Services                                                                                  |       | 58       |
| **PART IV**  |       |                                                                                                                    |       |     |
| Item 15.          |       | Exhibits and Financial Statement Schedules                                                                              |       | 59       |
|                   |            |                                                                                                                         |            |          |  |

 

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**PART I**

**Forward-LookingStatements**

This Annual Reporton Form 10-K, together with other statements and informationpublicly disseminated by New Plan Excel Realty Trust, Inc. (“we” or the “Company”),contains certain forward-looking statements within the meaning of Section 27Aof the Securities Act of 1933 and Section 21E of the Securities ExchangeAct of 1934. Such statements are based on assumptions and expectations whichmay not be realized and are inherently subject to risks, uncertainties andother factors, many of which cannot be predicted with accuracy and some ofwhich might not even be anticipated. Future events and actual results,performance, transactions or achievements, financial or otherwise, may differmaterially from the results, performance, transactions or achievementsexpressed or implied by the forward-looking statements. Risks, uncertaintiesand other factors that might cause such differences, some of which could bematerial, include, but are not limited to:

·       nationalor local economic, business, real estate and other market conditions, includingthe ability of the general economy to recover timely from economic downturns;

·       thecompetitive environment in which we operate;

·       propertyownership and management risks;

·       financialrisks, such as the inability to obtain debt or equity financing on favorableterms;

·       possiblefuture downgrades in our credit rating;

·       thelevel and volatility of interest rates and changes in the capitalization rateswith respect to the acquisition and disposition of properties;

·       financialstability of tenants, including the ability of tenants to pay rent, thedecision of tenants to close stores and the effect of bankruptcy laws;

·       theability to maintain our status as a real estate investment trust (“REIT”) forfederal income tax purposes;

·       governmentalapprovals, actions and initiatives;

·       environmental/safetyrequirements and costs;

·       risksof real estate acquisition and development, including the failure of pendingdevelopments and redevelopments to be completed on time and within budget andthe failure of newly acquired or developed properties to perform as expected;

·       risksof disposition strategies, including the failure to complete sales on a timelybasis and the failure to reinvest sale proceeds in a manner that generatesfavorable returns;

·       risksof joint venture activities; and

·       otherrisks identified in this Annual Report on Form 10-K and, from timeto time, in other reports we file with the Securities and Exchange Commission(the “SEC”) or in other documents that we publicly disseminate.

We undertake no obligation to publicly update orrevise these forward-looking statements, whether as a result of newinformation, future events or otherwise.

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**Item1.****                        *Business***

**General**

We are one of the nation’s largest owners, managersand developers of community and neighborhood shopping centers. As of December 31,2006, we owned interests in 467 properties in 38 states, including 289wholly-owned properties and one property held through a consolidated jointventure (collectively, our “Consolidated Portfolio”), as well as 177 propertiesheld through unconsolidated joint ventures. The 467 properties include 453community and neighborhood shopping centers with approximately 67.6 millionsquare feet of gross leasable area (“GLA”), and 14 related retail assets withapproximately 0.7 million square feet of GLA. In addition, we manage threeproperties, with approximately 0.7 million square feet of GLA, on behalf ofthird-party owners. Our Consolidated Portfolio includes 278 community andneighborhood shopping centers with approximately 40.7 million square feet ofGLA and 12 related retail assets with approximately 0.7 million square feet ofGLA. At December 31, 2006, the GLA for our Consolidated Portfolio wasapproximately 90.7% leased and the GLA for our total portfolio, including ourpro rata share of joint venture properties, was approximately 90.9% leased.

We are a self-administeredand self-managed equity real estate investment trust, which we refer to as aREIT, that was formed in 1972 and is incorporated in Maryland. We maintain ourprincipal executive offices at 420 Lexington Avenue, New York, New York 10170,where our telephone number is (212) 869-3000.

**Focused ProductStrategy**

Our strategy is toown and manage a quality portfolio of commercial retail properties, primarilycommunity and neighborhood shopping centers, which will provide increasing cashflow while protecting investor capital and providing potential for capitalappreciation. We seek to implement this strategy by:

·       aggressivelymanaging, and where appropriate, redeveloping and upgrading our properties;

·       selectivelypursuing new development opportunities;

·       selectivelyacquiring well-located commercial retail properties, primarily community andneighborhood shopping centers, either on an individual basis, in portfolio orcorporate transactions, or through joint venture arrangements;

·       effectingstrategic asset dispositions and recycling the capital created by thosetransactions;

·       providingretail real estate advisory services;

·       generatingfee income through the management of properties owned by joint ventures inwhich we have an economic interest, as well as properties owned by independentthird parties;

·       seekingto reduce risk through geographic, tenant and retail format diversification ofour portfolio; and

·       continuingto maintain a strong and flexible financial position.

By focusing our portfolio primarily on community andneighborhood shopping centers with anchors and other tenants providing “everydaynecessities,” we believe that our risk due to economic cycles is minimized.

Our ownership interests inreal estate consist of our Consolidated Portfolio, which includes wholly-ownedproperties and properties consolidated in accordance with the provisions of FinancialAccounting Standards Board Interpretation No. 46,*Consolidation of Variable Interest Entities*(“FIN 46”) or in accordance with the provisions of Emerging Issues Task Force (“EITF”)Issue No. 04-5, *Determining Whether aGeneral Partner, or the General Partners as a Group, Controls a LimitedPartnership or Similar*

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*EntityWhen the Limited Partners Have Certain Rights* (“EITF 04-5”),and our unconsolidated joint venture portfolio, which includes properties ownedby joint ventures in which we have an economic interest. By entering intostrategic joint ventures with institutional investors and other partners, weare able to generate capital sources for redevelopment, new development andacquisitions, as well as create an opportunity to earn fees for propertymanagement, leasing and other related services. Our joint ventures may growthrough acquisitions from third parties or direct purchases from us. We,together with our joint venture partners, apply similar operating, investingand capital strategies to the portfolios owned by our joint ventures as we dowith respect to our Consolidated Portfolio.

**Aggressive Management**

We aggressively manage our properties, with anemphasis on maintaining high occupancy rates and a strong base of nationallyand regionally recognized anchor tenants, as well as local specialty tenants,that generate substantial daily traffic. In order to support these efforts, wehave six regional offices and 11 satellite field offices throughout thecountry, each of which is responsible for managing the leasing, propertymanagement and maintenance of properties in its area. We regularly monitor thephysical condition of our properties and the financial condition of ourtenants. We continually use our leasing and management capabilities to seek opportunitiesfor tenant expansions, renovations and refurbishments to preserve and increasethe value of our properties. We are currently improving the general appearanceof certain of our properties by upgrading existing facades and roofs, updatingsignage, resurfacing parking lots and improving parking lot and exteriorbuilding lighting. In addition, we remain focused on enhancing our propertymanagement skills and our internal capabilities, systems and infrastructure.

We seek to increase thecash flow and portfolio value of our existing properties primarily throughcontractual rent increases during the lease term, re-letting of existing spaceat increased rents, expansion and redevelopment of existing properties,development of undeveloped outparcels and the minimization of overhead andoperating costs.

**Redevelopment andOutparcel Development of Properties**

During 2006, we completed 17 redevelopment projects inour Consolidated Portfolio, the aggregate cost of which, including costsincurred in prior years on these projects, was approximately $64.6 million. Ourcurrent redevelopment pipeline in our Consolidated Portfolio is comprised of 27projects, the aggregate cost of which, including costs incurred in prior yearson these projects, is expected to be approximately $189.4 million. Inaddition, during 2006, we completed four outparcel development projects in ourConsolidated Portfolio, the aggregate cost of which, including costs incurredin prior years on these projects, was approximately $8.0 million. Our currentoutparcel development pipeline in our Consolidated Portfolio is comprised ofnine projects, the aggregate cost of which, including costs incurred in prioryears on these projects, is expected to be approximately $22.2 million. Weintend on financing these redevelopment and outparcel development projectsthrough cash from operations or draws on our $350.0 million unsecured revolvingcredit facility, which was amended and restated on August 25, 2006 (as amended, the “AmendedRevolving Facility”).

We also redevelopproperties in our joint venture portfolios and during 2006, we completed oneredevelopment project, the aggregate cost of which, including costs incurred inprior years on this project, was approximately $3.9 million, of which our prorata share was approximately $0.4 million. The current redevelopment pipelinein our joint venture portfolios is comprised of nine projects, the aggregatecost of which, including costs incurred in prior years, is expected to beapproximately $125.8 million, of which our pro rata share will be approximately$14.7 million. In addition, we also develop outparcels at properties in ourjoint venture portfolios and during 2006, we completed two outparceldevelopment projects, the aggregate cost of which, including costs incurred inprior years on these projects, was approximately $6.0 million, of whichour pro rata share was approximately $0.3 million. The current outparcel 

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developmentpipeline in our joint venture portfolios is comprised of one project, theaggregate cost of which, including costs incurred in prior years on thisproject, is expected to be approximately $2.2 million, of which our prorata share will be approximately $0.1 million. We intend on financing theredevelopment and outparcel development projects in our joint ventureportfolios with a variety of financing vehicles as determined from time to timeby the joint venture.

**New Development ofProperties**

We selectively enter into new developmentopportunities. These projects are driven by tenant demand, and as such, wegenerally have a lease executed with the anchor tenant prior to investingsubstantial capital. Such activity enhances our relationships with our anchortenants by demonstrating our ability to serve their growth needs. Uponcompletion, we either hold the properties as long-term investments or sell themas part of a merchant building program. Properties that are developed as partof our merchant building program are owned in one of our wholly-owned taxableREIT subsidiaries, in accordance with the Tax Relief Extension Act of 1999,which became effective on January 1, 2001.

Our current new development pipeline in ourConsolidated Portfolio is comprised of seven projects, the aggregate cost ofwhich, including costs incurred in prior years on these projects, is expectedto be approximately $92.1 million. We intend on financing these new developmentprojects through cash from operations or draws on the Amended RevolvingFacility.

We also develop propertiesin our joint venture portfolios and the current pipeline for such newdevelopment projects in our joint venture portfolios is one project, theaggregate cost of which, including costs incurred in prior years on thisproject, is expected to be approximately $26.9 million, of which our pro ratashare will be approximately $1.3 million. We intend on financing any newdevelopment projects in our joint venture portfolios with a variety offinancing vehicles as determined from time to time by the joint venture.

**Acquisition ofProperties**

We focus on retail properties, primarily community andneighborhood shopping centers that generate stable cash flows and present theopportunity for value appreciation. We may seek to expand our consolidated andjoint venture portfolios by making selective, opportunistic acquisitions ofindividual properties and portfolios of well-located community and neighborhoodshopping centers and other retail properties. Such acquisitions may involvestabilized, income-producing community and neighborhood shopping centers, aswell as shopping centers that require significant re-tenanting andredevelopment where our ability to leverage our relationships with retailersand to utilize our management capabilities will allow us to enhance value. Wemay also consider investments in geographic markets where we do not presentlyoperate should suitable opportunities arise.

During 2006, we expanded our Consolidated Portfolio byopportunistically acquiring the following: (i) five shopping centers, (ii) twobuildings adjacent to shopping centers owned by us, (iii) the remaining90% interests in two shopping centers in which we owned the other 10%interests, (iv) a leasehold interest in a new development project and (v) sixland parcels. The acquisitions were completed in separate transactions during2006 for an aggregate purchase price of approximately $197.5 million and werecomprised of properties located within our existing regional concentrations.Included in the 2006 acquisitions of shopping centers is the acquisition ofTyrone Gardens, a 209,337 square foot shopping center located in St.Petersburg, Florida, for approximately $19.0 million by NewSem Tyrone GardensLLC, a joint venture with The Sembler Company in which we hold a 90% interest. Inaccordance with the provisions of EITF 04-5, this property is included asa consolidated entity in our Consolidated Financial Statements.

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During 2006, we alsoexpanded our joint venture portfolios by acquiring, together with our jointventure partners, 15 properties and one land parcel for an aggregate purchaseprice of approximately $336.3 million.

**Disposition ofProperties**

We generally hold our properties for investment andthe production of rental income and not for sale to customers or other buyersin the ordinary course of our business. However, to maximize shareholder value,we continually analyze each asset in our portfolio and identify thoseproperties that can be sold or exchanged in light of prevailing marketconditions and the particular characteristics of each property. Through thisstrategy, we seek to continually update our core property portfolio bydisposing of properties that have limited growth potential or are not astrategic fit within our overall portfolio and redeploying such capital intonewer properties or properties where management techniques may maximizeproperty values. We may engage from time to time in like-kind propertyexchanges, which allow us to dispose of properties and redeploy proceeds in atax efficient manner.

In addition, we may sell and contribute assets to ourexisting joint ventures or to newly formed joint ventures. Although sellingproperties to joint ventures reduces our ownership interest in such property,we continue to share in the potential upside of properties that meet ourlong-term investment strategy, while retaining property managementresponsibilities, leveraging our infrastructure and generating fee income. Inaddition, we may facilitate the transfer of an individual asset or portfolio ofassets between our joint ventures.

During 2006, we generatedproceeds of approximately $124.0 million through the dispositions of 27shopping centers (15 of which were sold to a single buyer in a portfoliotransaction), two miscellaneous properties and six land parcels, each of whichwere part of our Consolidated Portfolio. In addition, we generatedapproximately $1.3 million from our pro rata share of the dispositions of threeproperties and one land parcel held through our joint ventures.

**Retail Real EstateAdvisory Services**

In order to capitalize onour asset management expertise and our broad geographic and tenant reach, wealso provide retail real estate advisory services, including leasing anddisposition strategies, for retailers. Our efforts may include services for ourcurrent tenants, as well as for retailers not currently leasing space in ourportfolio. For example, during 2006, we were engaged by The Great Atlantic &Pacific Tea Company to advise on the sublease, assignment or other dispositionof certain surplus Farmer Jack and Food Basics lease locations in the SoutheastMichigan and Toledo, Ohio markets.

**PortfolioDiversification**

We seek to reduce riskthrough diversification achieved by the geographic distribution of ourproperties, the breadth of our tenant base and the balanced mix of bothcommunity and neighborhood shopping centers. As a result, the largest shoppingcenter in our Consolidated Portfolio, as a percent of our total ConsolidatedPortfolio annualized base rent (“ABR”), is just 2.0% of our total ConsolidatedPortfolio ABR and the ten largest tenants in our Consolidated Portfolio accountfor 18.2% of our total Consolidated Portfolio ABR.  Including our pro rata share of ABR fromunconsolidated joint venture properties, our largest shopping center, as apercent of our total portfolio ABR, is just 1.8% of our total portfolio ABR andour ten largest tenants account for 17.8% of our total portfolio ABR. Ourproperties are strategically located across 38 states and throughout more than165 metropolitan and micropolitan statistical areas (as defined by The UnitedStates Office of Management and Budget for application to Census Bureau data).By owning both community shopping centers and neighborhood shopping centers we 

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are ableto offer convenience shopping for the day-to-day needs of consumers, as well asa broad range of general merchandise.

**Financing Strategy**

***Genera*l**

We intend to finance redevelopments of existingassets, new developments and future acquisition opportunities with the mostadvantageous sources of capital available to us at the time, which may includethe sale of common stock, preferred stock or debt securities through publicofferings or private placements, the incurrence of additional indebtednessthrough secured or unsecured borrowings, and the reinvestment of proceeds fromthe disposition of properties or joint venture interests. We also may enterinto additional joint ventures with institutions to acquire individualproperties or portfolios, reducing the amount of capital required by us to makesuch investments. Our financing strategy is to maintain a strong and flexiblefinancial position by:

·       maintaininga prudent level of leverage in order to maintain current investment-gradecredit ratings,

·       maintaininga large pool of unencumbered properties, and

·       managing our exposure tointerest rate risk from our floating rate debt.

***FinancingActivities***

***Amendments and Restatements ofCredit Agreements***

On August 25, 2006, we amended and restated ourthen existing $350.0 million unsecured revolving credit facility and added anaccordion feature to the Amended Revolving Facility that allows us, subject tocertain conditions, to increase the amount that can be borrowed under thefacility to $500.0 million. The Amended Revolving Facility bears interest atLIBOR plus 55 basis points (based on our current credit ratings) and incurs anannual facility fee of 15 basis points. The Amended Revolving Facility isscheduled to mature on August 25, 2010, with a one-year extension option.

On August 25, 2006,we also amended and restated our then existing $150.0 million secured term loan(as amended, the “Amended Secured Term Loan”). The Amended Secured Term Loanbears interest at LIBOR plus 55 basis points (based on our current creditratings) and is scheduled to mature on August 25, 2010.

***Issuance of 3.70% Senior ConvertibleNotes and Repurchase of $50.0 Million of Common Stock***

On September 19, 2006, we completed a privateoffering of $200.0 million aggregate principal amount of 3.70% seniorconvertible notes (the “3.70% Convertible Notes”) due September 15, 2026(the “September 2006 Debt Offering”).  At certain times and upon the occurrence ofcertain events, the notes are convertible into cash up to their principalamount and, with respect to the remainder, if any, of the conversion value inexcess of such principal amount, cash or shares of our common stock. Theinitial conversion rate will be 30.5506 shares per $1,000 principal amount ofnotes (which is equivalent to an initial conversion price of $32.73 per share).The notes may not be redeemed by us prior to September 20, 2011 (except topreserve our status as a REIT for U.S., federal income tax purposes), but areredeemable anytime thereafter, in whole or in part, at a redemption price equalto the principal amount of the notes plus any accrued and unpaid interest(including additional interest), if any. In addition, on September 20,2011, September 15, 2016, and September 15, 2021, or upon theoccurrence of certain change in control transactions prior to September 20,2011, note holders may require us to repurchase all or a portion of the notesat a purchase price equal to the principal amount plus any accrued and unpaidinterest on the notes. 

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Net proceeds from the September 2006Debt Offering were used to repurchase and retire 1,863,600 shares of our commonstock at an average purchase price of $26.83 per share (approximately $50.0million in aggregate value) and for general corporate purposes, including therepayment of outstanding borrowings under our Amended Revolving Facility.

On November 3, 2006,we filed a registration statement on Form S-3 (the “RegistrationStatement”) registering the resale of the 3.70% Convertible Notes and theshares of our common stock, which may, under certain circumstances, becomeissuable upon conversion of the 3.70% Convertible Notes. The 3.70% ConvertibleNotes were originally sold to qualified institutional buyers by means of aprivate placement in accordance with Rule 144A under the Securities Act of1933, as amended. At the time of the September 2006 Debt Offering, weentered into a Registration Rights Agreement with the initial purchasers ofthe 3.70% Convertible Notes, which required the filing of the RegistrationStatement. We will not receive any of the proceeds from the sale ofthe 3.70% Convertible Notes or the shares of common stock issuable uponconversion of the 3.70% Convertible Notes by the selling securityholders. On November 22,2006, December 11, 2006, December 22, 2006, January 16, 2007 andFebruary 2, 2007, we filed prospectus supplements to the RegistrationStatement naming additional beneficial holders as selling securityholders ofthe 3.70% Convertible Notes and shares of our common stock issuable uponconversion of the 3.70% Convertible Notes.

**Competition**

We face considerable competition in the leasing ofreal estate, which is a highly competitive market. We compete with a number ofother companies in providing leases to prospective tenants and in re-lettingspace to current tenants upon expiration of their respective leases. If ourtenants decide not to renew or extend their leases upon expiration, we may notbe able to re-let the space. Even if the tenants do renew or we can re-let thespace, the terms of renewal or re-letting, including the cost of requiredrenovations or concessions to tenants, may be less favorable or more costlythan current lease terms or than expectations for the space. We believe thatthe principal competitive factors in attracting tenants in our market areas arelocation, price, co-tenants and physical conditions of our properties. In thisregard, we aggressively manage and, where appropriate, redevelop and upgrade,our properties, with an emphasis on maintaining high occupancy rates and astrong base of nationally and regionally recognized anchor tenants, as well aslocal specialty tenants, that generate substantial daily traffic. In addition,we believe that the breadth of our national portfolio of properties, and thelocal knowledge and market intelligence of our regional operating system, makeus attractive to national, regional and local retailers.

In addition, we facesignificant competition for acquisitions of, and investments in, properties andreal estate companies with an indeterminate number of investors, includinginvestors with access to significant capital such as domestic and foreigncorporations and financial institutions, publicly traded and privately heldREITs, private institutional investment funds, investment banking firms, lifeinsurance companies and pension funds. The current market for acquisitionscontinues to be highly competitive. Nevertheless, we believe that ourexperience in operating, acquiring, developing and obtaining financing forcommunity and neighborhood shopping centers, particularly our ability tostructure acquisitions, should enable us to compete effectively. Given ouroperating and capital strategies, we have the capacity to acquire individualproperties or portfolios on both our own balance sheet or with joint venturecapital, which enables us to allocate risk and increase returns. We can alsoacquire stabilized, income producing properties or properties that can benefitfrom our re-tenanting and redevelopment competencies. In addition, because ofthe breadth of our portfolio, we can acquire properties across the nation andare able to efficiently absorb such properties into our scalable regionaloperating system.

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**EnvironmentalExposure**

We are subject to federal, state and localenvironmental regulations that apply generally to the ownership of realproperty and the operations conducted on real property. Under various federal,state and local laws, ordinances and regulations, we may be considered an owneror operator of real property or may have arranged for the disposal or treatmentof hazardous or toxic substances or petroleum product releases at a propertyand, therefore, may become liable for the costs of removal or remediation ofcertain hazardous substances released on or in our property or disposed of byus, as well as certain other potential costs which could relate to hazardous ortoxic substances (including governmental fines and injuries to persons andproperty). Such liability may be imposed whether or not we knew of, or wereresponsible for, the presence of these hazardous or toxic substances. As iscommon with community and neighborhood shopping centers, many of our propertieshad or have on-site dry cleaners and/or on-site gasoline facilities. Theseoperations could potentially result in environmental contamination at theproperties. The cost of investigation, remediation or removal of such substancesmay be substantial, and the presence of such substances, or the failure toproperly remediate such substances, may adversely affect our ability to sell orrent such property or to borrow using such property as collateral.

We are aware that soil andgroundwater contamination exists at some of our properties. The primarycontaminants of concern at these properties include perchloroethylene andtrichloroethylene (associated with the operations of on-site dry cleaners) andpetroleum hydrocarbons (associated with the operations of on-site gasolinefacilities). We also are aware that asbestos-containing materials exist at someof our properties. While we do not expect the environmental conditions at ourproperties, considered as a whole, to have a material adverse effect on us,there can be no assurance that this will be the case. Further, no assurance canbe given that any environmental studies performed have identified or willidentify all material environmental conditions, that any prior owner of the propertiesdid not create a material environmental condition not known to us or that amaterial environmental condition does not otherwise exist with respect to anyof our properties.

**Employees**

As of December 31,2006, we employed approximately 440 individuals (including, executive,administrative and field personnel).

**AvailableInformation**

Our internet websiteaddress is www.newplan.com. The information contained on our website isnot incorporated by reference into this report and such information should notbe considered a part of this report. You can obtain on our website, free ofcharge, a copy of our annual report on Form 10-K, our quarterlyreports on Form 10-Q, our current reports on Form 8-K,and any amendments to those reports, as soon as reasonably practicable after weelectronically file such reports or amendments with, or furnish them to, theSEC. Also available on our website, free of charge, are copies of our Code ofBusiness Conduct and Ethics, our Code of Ethics for Principal Executive Officerand Senior Financial Officers, our Corporate Governance Guidelines, and thecharters for each of the committees of our Board of Directors—the AuditCommittee, the Corporate Governance and Nominating Committee and the ExecutiveCompensation and Stock Option Committee. Copies of our Code of Business Conductand Ethics, our Code of Ethics for Principal Executive Officer and SeniorFinancial Officers, our Corporate Governance Guidelines, and our committeecharters are also available in print free of charge, upon request by anystockholder. You can obtain such copies in print by contacting our Senior VicePresident of Corporate Communications, either by mail at our corporate officeor by e-mail at corporatecommunications@newplan.com.

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**FinancialInformation about Industry Segments**

Our principal business isthe ownership, management and development of community and neighborhoodshopping centers. We do not distinguish or group our operations on ageographical basis when measuring performance. All operations are within theUnited States and no tenant accounts for more than 10% of total revenue.Accordingly, we believe we have a single reportable segment for disclosurepurposes in accordance with accounting principles generally accepted in theUnited States. See the Consolidated Financial Statements and Notes theretoincluded in Item 8 of this Annual Report on Form 10-K for certaininformation required by Item 1.

**Item1A.****                *Risk Factors***

*Overview*

Set forth below arethe risks that we believe are material to investors who purchase or own oursecurities that are not otherwise described in this Annual Report on Form 10-K.We have separated the risks into three groups:

·       risksrelated to our properties and business;

·       risksrelated to our organization and structure; and

·       taxrisks.

The occurrence of any ofthe following factors or circumstances could adversely affect our cash flows,financial condition, results of operations and/or our ability to meet ouroperating expenses, including debt service and capital expenditure obligations,and make distributions to our stockholders, any or all of which could in turncause a decline in the market value of our securities.

*Risks Related to Our Properties andBusiness*

***The economic performance and value of our propertiesare subject to risks associated with real estate assets and with the realestate industry.***   As a real estate company,we are subject to all of the risks associated with owning and operating realestate, including:

·       changesin the national, regional and local economic climate, particularly in Texas,where properties that represented 17.0% of our Consolidated Portfolio total ABRand 17.3% of our total portfolio total ABR, each as of December 31, 2006,are located;

·       localconditions, including an oversupply of space in properties similar to thosethat we own, or a reduction in demand for properties similar to those that weown;

·       theattractiveness of our properties to tenants;

·       thefinancial stability of tenants, including the ability of tenants to pay rent;

·       competitionfrom other available properties;

·       changesin market rental rates;

·       theneed to periodically fund the costs to repair, renovate and re-let space;

·       changesin operating costs, including costs for maintenance, insurance and real estatetaxes;

·       earthquakes,tornados, hurricanes and other natural disasters, civil unrest, terrorist actsor acts of war, which may result in uninsured or underinsured losses;

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·       thefact that the expenses of owning and operating properties are not necessarilyreduced when circumstances such as market factors and competition cause areduction in income from the properties; and

·       changesin laws and governmental regulations, including those governing usage, zoning,the environment and taxes.

***Downturns in the retailingindustry likely will have a direct impact on our performance.******  ***Our properties consist ofcommunity and neighborhood shopping centers and other retail properties. Ourperformance therefore is linked to economic conditions in the market for retailspace generally, and a decrease in the demand for retail space may have agreater adverse effect on our business and financial condition than if we owneda more diversified real estate portfolio. The market for retail space has beenor could be adversely affected by weakness in the national, regional and localeconomies, the adverse financial condition of some large retailing companies,the ongoing consolidation in the retail sector, the excess amount of retailspace in a number of markets, and increasing consumer purchases throughcatalogues and the Internet. To the extent that any of these conditions occur,they are likely to impact market rents for retail space and could adverselyaffect our business.

***Failure by anyanchor tenant with leases in multiple locations to make rental payments to us,because of a deterioration of its financial condition or otherwise, couldseriously harm our performance.***   Ourperformance depends on our ability to collect rent from tenants. At any time,our tenants may experience a downturn in their business that may significantlyweaken their financial condition. As a result, our tenants may delay a numberof lease commencements, decline to extend or renew a number of leases uponexpiration, fail to make rental payments when due under a number of leases,close a number of stores or declare bankruptcy. Any of these actions couldresult in the termination of the tenant’s leases, or expiration of existingleases without renewal, and the loss of rental income attributable to theterminated or expired leases. In addition, lease terminations by an anchortenant or a failure by that anchor tenant to occupy the premises could resultin lease terminations or reductions in rent by other tenants in the sameshopping centers under the terms of some leases. In that event, we may beunable to re-lease the vacated space at attractive rents or at all. Theoccurrence of any of the situations described above, particularly if itinvolves a substantial tenant with leases in multiple locations, couldseriously harm our performance. As of December 31, 2006, our largesttenants were The Kroger Co., Wal-Mart Stores and Sears Holdings Corp., thescheduled ABR for which, represented 4.1%, 2.4% and 2.3%, respectively, of ourtotal ABR including our pro rata share of ABR generated by properties owned byunconsolidated joint ventures. As of December 31, 2006, The Kroger Co.,Wal-Mart Stores and Sears Holdings Corp. represented 4.3%, 2.5% and 2.4%,respectively, of our scheduled ABR, excluding our pro rata share of ABRgenerated by properties owned by unconsolidated joint ventures.

***We may be unable tocollect balances due from any tenants in bankruptcy.******  ***We cannot assure you that anytenant that files for bankruptcy protection will continue to pay us rent. Abankruptcy filing by or relating to one of our tenants or a lease guarantorwould bar all efforts by us to collect pre-bankruptcy debts from that tenant orthe lease guarantor, or their property, unless we receive an order permittingus to do so from the bankruptcy court. A tenant or lease guarantor bankruptcycould delay our efforts to collect past due balances under the relevant leases,and could ultimately preclude collection of these sums. If a lease is assumedby the tenant in bankruptcy, all pre-bankruptcy balances due under the leasemust be paid to us in full. However, if a lease is rejected by a tenant inbankruptcy, we would have only a general unsecured claim for damages. Anyunsecured claim we hold may be paid only to the extent that funds are availableand only in the same percentage as is paid to all other holders of unsecuredclaims, and there are restrictions under bankruptcy laws that limit the amountof the claim we can make if a lease is rejected. As a result, it is likely thatwe will recover substantially less than the full value of any unsecured claimswe hold from a bankrupt tenant.

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***We faceconsiderable competition in the leasing market and may be unable to renewleases or re-let space as leases expire.****  *We compete with a number of other companies inproviding leases to prospective tenants and in re-letting space to currenttenants upon expiration of their respective leases. If our tenants decide notto renew or extend their leases upon expiration, we may not be able to re-letthe space. Even if the tenants do renew or we can re-let the space, the termsof renewal or re-letting, including the cost of required renovations orconcessions to tenants, may be less favorable or more costly than current leaseterms or than expectations for the space. As of December 31, 2006, leaseswere scheduled to expire on a total of approximately 11.6% of the space at ourproperties (including our pro rata share of properties owned by unconsolidatedjoint ventures) through 2007. We may be unable to promptly renew the leases orre-let this space, or the rental rates upon renewal or re-letting may besignificantly lower than expected rates.

***Future acquisitionsof properties may not yield the returns we expect, may result in disruptions toour business and may strain management resources.***   Weintend to continue acquiring select community and neighborhood shoppingcenters. In deciding whether to acquire a particular property, we make certainassumptions regarding the expected future performance of that property. However,newly acquired properties may fail to perform as expected. Our management mayunderestimate the costs necessary to bring acquired properties up to standardsestablished for their intended market position, which may result in theproperties’ failure to achieve projected returns.

In particular, wemay acquire large portfolios of community and neighborhood shopping centers. Largeportfolio acquisitions pose risks for our ongoing operations in that:

·       wemay not achieve expected cost savings and operating efficiencies;

·       managementattention may be diverted to the integration of acquired properties;

·       theacquired properties may not perform as well as we anticipate due to variousfactors, including changes in macro-economic conditions and the demand forretail space; and

·       wemay experience difficulties and incur expenses related to the assimilation andretention of employees that we have hired or intend to hire to manage andoperate acquired properties.

***We face significantcompetition for acquisitions of real properties, which may reduce the number ofacquisition opportunities available to us and increase the costs of theseacquisitions.***   We compete for acquisitionsof, and investments in, properties and real estate companies with anindeterminate number of investors, including investors with access tosignificant capital such as domestic and foreign corporations and financialinstitutions, publicly traded and privately held REITs, private institutionalinvestment funds, investment banking firms, life insurance companies andpension funds. The current market for acquisitions continues to be extremelycompetitive. This competition may increase the demand for the types ofproperties in which we typically invest and, therefore, reduce the number ofsuitable acquisition opportunities available to us and increase the prices paidfor such acquisition properties.

***Current and futuredevelopment and redevelopment of real estate properties may not yield expectedreturns and may strain management resources.***   Weare actively involved in several ongoing redevelopment projects, and in thepast few years have become more actively involved in development projects. Wealso expect to invest in additional development and redevelopment projects inthe future.

Redevelopment andnew development of properties are subject to a number of risks, including thefollowing:

·       abandonmentof development activities after expending resources to determine feasibility;

·       constructionand/or lease-up delays;

·       costoverruns, including construction costs that exceed our original estimates;

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·       failureto achieve expected occupancy and/or rent levels within the projected timeframe, if at all; and

·       delayswith respect to obtaining or the inability to obtain necessary zoning,occupancy, land use and other governmental permits, and changes in zoning andland use laws.

If any of these problems occur, overall project costsmay significantly exceed the costs that were estimated when the project wasoriginally undertaken, which will result in reduced returns, or even losses,from such investments. In addition, delays in the completion of a developmentor redevelopment project may provide various tenants the right to withdraw froma property.

***Our current and future joint venture investments couldbe adversely affected by a lack of sole decision-making authority and ourreliance on joint venture partners’ financial condition.***   We have invested in some casesas a co-venturer or partner in the development or redevelopment of newproperties, instead of developing projects directly. These investments involverisks not present in a wholly owned development or redevelopment project, includingthe following:

·       inthese investments, we do not have exclusive control over the development,financing, leasing, management and other aspects of the project, which mayprevent us from taking actions that are opposed by our joint venture partners;

·       wemay be required to obtain prior consent from our co-venturers or partners for asale or transfer to a third party of our interests in the joint venture, whichrestricts our ability to dispose of our interest in the joint venture;

·       ourco-venturers or partners might have interests or goals that are inconsistentwith our interests or goals, and may be in a position to take actions contraryto our interests or otherwise impede our objectives;

·       ourco-venturers or partners also might become insolvent or bankrupt, which maydelay construction or development of a property or increase our financialcommitment to the joint venture;

·       suchinvestments have the potential risk of impasse on certain major decisions, suchas a sale, because neither we nor our partner or co-venturer typically havefull control over the joint venture;

·       anydisputes that may arise between us and our joint venture partners could resultin litigation or arbitration that could increase our expenses and distract ourofficers and/or directors from focusing their time and effort on our business;and

·       wemight be liable for the actions of our joint venture partners in certaincircumstances, and the activities of a joint venture could adversely affect ourability to qualify as a REIT, even though we do not control the joint venture.

As of December 31, 2006, we had approximately$91.4 million of investments in and advances to 13 unconsolidated jointventures that own an aggregate of 177 properties. The largest of theseinvestments is our investment in the Galileo America LLC venture. We have a 5%equity interest in this joint venture, which interest was acquired on August 10,2005 in conjunction with our sale of an aggregate of 69 community andneighborhood shopping centers to Galileo America LLC. Our investment in thisjoint venture is subject to the risks described above for jointly ownedinvestments. As of December 31, 2006, this joint venture was comprised of132 stabilized assets, two assets undergoing redevelopment and one newdevelopment asset.

***Real estateproperty investments are illiquid, and therefore we may not be able to disposeof properties when appropriate or on favorable terms.***   Realestate property investments generally cannot be disposed of quickly. Inaddition, the federal tax code imposes restrictions on a REIT’s ability todispose of properties 

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that are not applicable toother types of real estate companies. In particular, the tax laws applicable toREITs require that we hold our properties for investment, rather than primarilyfor sale in the ordinary course of business, which may cause us to forego ordefer sales or properties that otherwise would be in our best interest. Therefore,we may not be able to vary our portfolio in response to economic or otherconditions promptly or on favorable terms, which may adversely affect ourfinancial position.

***Some potentiallosses are not covered by insurance, so we could lose a significant portion ofour investment in a property.******  ***Wecarry comprehensive liability, fire, extended coverage, rental loss and acts ofterrorism insurance on all of our properties. We believe the policyspecifications and insured limits of these policies are adequate andappropriate given the relative risk of loss, the cost of the coverage andindustry practice. There are, however, certain types of losses, including leaseand other contract claims, acts of war and acts of God, and, in some cases,flooding, that generally are not insured, either because such coverage is notavailable or is not available at commercially reasonable rates. If weexperience a loss which is uninsured or which exceeds policy limits, wecould lose a significant portion of the capital we have invested in the damagedproperty, as well as the anticipated future revenue from the property. Inflation,changes in building codes and ordinances, environmental considerations, andother factors also might make it impractical or undesirable to use insuranceproceeds to replace a property after it has been damaged or destroyed. In addition,if the damaged properties are subject to recourse indebtedness, we wouldcontinue to be liable for the indebtedness, even if these properties wereirreparably damaged.

***There can be noassurance as to future costs and the scope of coverage that may be availableunder insurance policies.******  ***Althoughwe believe our properties are adequately covered by insurance, we cannotpredict at this time if we will be able to obtain full coverage in the futureat a reasonable cost. The costs associated with property and casualty renewalsmay be higher than anticipated.

***We have substantialscheduled debt payments, which will result in significant debt serviceobligations, and we may not be able to refinance debt at maturity.***   Asof December 31, 2006, the total principal amount of our outstanding debtwas approximately $1.8 billion. Therefore, our business is subject to risksnormally associated with debt financing, including the risk that our cash flowwill be insufficient to pay expected dividends to stockholders and meetrequired payments of principal and interest. We are also subject to the riskthat we may not be able to refinance existing debt, which in virtually allcases requires substantial principal payments at maturity, and, even if we can,the terms of a refinancing might not be as favorable as the terms of existingdebt. If principal payments due at maturity cannot be refinanced, extended orpaid with proceeds of other capital transactions, including new equity capital,cash flow may not be sufficient in all years to repay all maturing debt at therelevant time(s) and we may be forced to dispose of properties ondisadvantageous terms. In addition, prevailing interest rates, our results ofoperations and financial condition, our senior debt ratings or other factors atthe time of refinancing, including the possible reluctance of lenders to makeloans, may result in higher interest rates and increased interest expense,which could adversely affect our cash flow and our ability to pay distributionsto stockholders.

***Our degree of leverage could limit our ability toobtain additional financing and adversely affect our business and financialcondition.***   Our organizational documents donot contain any limitation on the incurrence of debt. The degree of ourleverage could have important consequences, including:

·       requiringus to dedicate a substantial portion of our funds from operations to servicingour debt, thereby reducing the amount available for distributions;

·       affectingour ability to obtain additional financing in the future for working capital,capital expenditures, acquisitions, development or other general corporatepurposes; and

·       makingus more vulnerable to economic and industry downturns.

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In addition, as a result of the financial andoperating covenants described below, our leverage could reduce our flexibilityin conducting our business and planning for, or reacting to, changes in ourbusiness and in the real estate industry.

***We currently havevariable rate debt obligations, which could be substantial in the future andmay impede our operating performance and put us at a competitive disadvantage.***   Asof December 31, 2006, we had approximately $265.3 million of outstandingfloating rate debt, including the impact of swaps, maturing at various times upto September 1, 2011. In addition, we could increase the amount of ouroutstanding variable rate debt in the future in part by borrowing under theAmended Revolving Facility, which bears interest at a variable rate and hadapproximately $309.0 million available for draw as of December 31, 2006. Therates on our variable rate indebtedness increase when interest rates increase. Interestrates are currently low relative to historical levels and may increasesignificantly in the future. Increases in interest rates, or the loss of thebenefits of any hedging agreements that we might have, would increase our interestexpense, which would adversely affect cash flow and our ability to service debtand pay dividends to stockholders.

Hedging agreements enable us to convert floating rateliabilities to fixed rate liabilities or fixed rate liabilities to floating rateliabilities. Hedging agreements expose us to the risk that the counterpartiesto such agreements may not perform, even though the counterparties to hedgingagreements that we enter into are major financial institutions, which couldincrease our exposure to fluctuating interest rates. In addition, hedgingagreements may involve costs, such as transaction fees or breakage costs, if weterminate them. As of December 31, 2006, we were a party to four hedgingagreements.

As discussed above, we may borrow additional moneywith floating interest rates in the future. Increases in interest rates, or theloss of the benefits of our existing or future hedging agreements, wouldincrease our interest expense, which would adversely affect cash flow and ourability to service our debt. Future increases in interest rates will increaseour interest expense as compared to the fixed rate debt underlying our hedgingagreements and could result in our making payments to unwind such agreements.

***Mortgage debtobligations expose us to the possibility of foreclosure, which could result inthe loss of our investment in a property or group of properties subject tomortgage debt.***   As of December 31, 2006,we had approximately $437.3 million of mortgage debt outstanding, excluding theimpact of unamortized premiums. If a property or group of properties ismortgaged to secure payment of debt and we are unable to meet mortgage payments,the holder of the mortgage or lender could foreclose on the property, resultingin loss of our investment. Also, certain of these mortgages contain customarynegative covenants which, among other things, limit our ability, without theprior consent of the lender, to further mortgage the property, to enter intonew leases or materially modify existing leases, and to discontinue insurancecoverage.

***Our financialcovenants may restrict our operating and acquisition activities.******  ***The Amended RevolvingFacility, the Amended Secured Term Loan and the indentures under which oursenior unsecured debt is issued contain certain financial and operatingcovenants, including, among other things, certain coverage ratios, as well aslimitations on our ability to incur secured and unsecured debt, make dividendpayments, sell all or substantially all of our assets and engage in mergers andconsolidations and certain acquisitions. These covenants may restrict ourability to pursue certain business initiatives or certain acquisitiontransactions. In addition, failure to meet any of these covenants, includingthe financial coverage ratios, could cause an event of default under and/oraccelerate some or all of our indebtedness, which would have a material adverseeffect on us.

***A downgrade in ourcredit rating could negatively impact us.******  ***The floating rates ofinterest applicable to much of our debt, including debt under our creditfacilities, are determined based on the credit ratings of our debt provided byindependent rating agencies. Thus, if these credit ratings are downgraded, ourinterest expense will be, and our ability to raise additional debt may be,negatively impacted.

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***Environmentalproblems that exist at some of our properties could result in significantunexpected costs.******  ***Weare subject to federal, state and local environmental regulations that applygenerally to the ownership of real property and the operations conducted onreal property. Under various federal, state and local laws, ordinances andregulations, we may be considered an owner or operator of real property or mayhave arranged for the disposal or treatment of hazardous or toxic substances orpetroleum product releases at a property and, therefore, may become liable forthe costs of removal or remediation of certain hazardous substances released onor in our property or disposed of by us, as well as certain other potentialcosts which could relate to hazardous or toxic substances (includinggovernmental fines and injuries to persons and property). Such liability may beimposed whether or not we knew of, or were responsible for, the presence ofthese hazardous or toxic substances. As is common with community andneighborhood shopping centers, many of our properties had or have on-site drycleaners and/or on-site gasoline facilities. These operations could potentiallyresult in environmental contamination at the properties. The cost ofinvestigation, remediation or removal of such substances may be substantial,and the presence of such substances, or the failure to properly remediate suchsubstances, may adversely affect our ability to sell or rent such property orto borrow using such property as collateral.

We are aware that soil and groundwater contaminationexists at some of our properties. The primary contaminants of concern at theseproperties include perchloroethylene and trichloroethylene (associated with theoperations of on-site dry cleaners) and petroleum hydrocarbons (associated withthe operations of on-site gasoline facilities). We also are aware that asbestos-containingmaterials exist at some of our properties. While we do not expect theenvironmental conditions at our properties, considered as a whole, to have amaterial adverse effect on us, there can be no assurance that this will be thecase. Further, no assurance can be given that any environmental studiesperformed have identified or will identify all material environmentalconditions, that any prior owner of the properties did not create a materialenvironmental condition not known to us or that a material environmentalcondition does not otherwise exist with respect to any of our properties.

***Changes in market conditions could adversely affectthe market price of our publicly traded securities.******  ***As with other publicly tradedsecurities, the market price of our publicly traded securities depends onvarious market conditions, which may change from time to time. Among the marketconditions that may affect the market price of our publicly traded securitiesare the following:

·       theextent of institutional investor interest in the company;

·       thereputation of REITs generally and the reputation of REITs with portfoliossimilar to ours;

·       theattractiveness of the securities of REITs in comparison to securities issued byother entities (including securities issued by other real estate companies);

·       ourfinancial condition and performance;

·       themarket’s perception of our growth potential and potential future cashdividends;

·       changesin our revenues or earnings estimates or recommendations by securities analysts;

·       publicationof research reports about us or our industry by securities analysts;

·       anincrease in market interest rates, which may lead prospective investors todemand a higher distribution rate in relation to the price paid for our shares;

·       strategicdecisions by us or our competitors, such as acquisitions, divestments,spin-offs, joint ventures, strategic investments or changes in businessstrategy;

·       thepassage of legislation or other regulatory developments that adversely affectus or our industry;

·       speculationin the press or investment community;

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·       actionsby institutional shareholders or hedge funds, including trading or hedgingactivity; and

·       generaleconomic and financial market conditions.

Sales of a substantialnumber of shares of our stock, or the perception that such sales could occur,also could adversely affect prevailing market prices for our stock. These salesalso might make it more difficult for us to sell equity or equity-relatedsecurities in the future at a time and price that we deem appropriate. Inaddition to the possibility that we may sell shares of our stock in a publicoffering at any time, we also may issue shares of common stock upon redemptionof units of partnership interest held by third parties in affiliated partnershipsthat we control, as well as in connection with grants of restricted stock orupon exercise of stock options that we grant to our officers and employees. Allof these shares will be available for sale in the public markets from time totime.

*Risks Related to Our Organizationand Structure*

***Provisions of thecompany’s charter and bylaws could inhibit changes in control of the company,and could prevent stockholders from obtaining a premium price for our commonstock.***   A number of provisions of our charterand bylaws may delay, defer or prevent a change in control of the company orother transactions that could provide stockholders with a premium over thethen-prevailing market price of our common stock or that might otherwise be inthe best interests of the stockholders. These provisions include a staggeredboard of directors, advance notice requirements for stockholder proposals andour share ownership limit described below. In addition, our charter permits ourBoard of Directors to issue up to 25,000,000 shares of preferred stock, havingthose preferences, conversion or other rights, voting powers, restrictions,limitations as to distributions, qualifications, or terms or conditions ofredemption as determined by our Board of Directors. Thus, any future series ofour preferred stock may have voting or other provisions that could delay orprevent a change in control or other transaction that might involve a premiumover the then-prevailing market price of our common stock or that mightotherwise be in the best interests of the stockholders.

***Our Board of Directors could adopt the limitationsavailable under Maryland law on changes in control that could preventtransactions in the best interests of stockholders.***   Certainprovisions of Maryland law may have the effect of inhibiting a third party frommaking an acquisition proposal or of impeding a change in control undercircumstances that otherwise could provide our common stockholders with theopportunity to realize a premium over the then-prevailing market price of ourcommon stock, including the following:

·       “businesscombination moratorium/fair price” provisions that, subject to limitations,prohibit certain business combinations between us and an “interested shareholder”(defined generally as any person who beneficially owns 10% or more of thevoting power of our outstanding shares or an affiliate thereof) for five yearsafter the most recent date on which the shareholder becomes an interestedshareholder, and thereafter a business combination with an interestedstockholder must be approved by two super-majority stockholder votes unless,among other conditions, our common stockholders receive a minimum price fortheir shares and the consideration is received in cash or in the same form aspreviously paid by the interested stockholder for its shares of common stock;and

·       “controlshare” provisions that provide that “control shares” of our company (defined asshares which, when aggregated with other shares controlled by the shareholder,entitle the shareholder to exercise one of three increasing ranges of votingpower in electing trustees) acquired in a “control share acquisition” (definedas the direct or indirect acquisition of ownership or control of “control shares”from a party other than the issuer) have no voting rights except to the extentapproved by our shareholders by the affirmative vote of at least two thirds ofall the votes entitled to be cast on the matter, excluding all interestedshares, and are subject to redemption in certain circumstances.

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Our Board of Directors has opted out of theseprovisions of Maryland law. As a result, these provisions will not apply to abusiness combination or control share acquisition involving the company. OurBoard of Directors may, however, repeal these elections in most cases and causethe company to become subject to these provisions in the future.

***Our share ownershiplimit may discourage a takeover of the company and depress our stock price.******  ***To facilitate maintenance ofour REIT qualification and for other strategic reasons, our charter generallyprohibits any person from acquiring or holding shares of our preferred andcommon stock in excess of 9.8% (by value or by number of shares, whichever ismore restrictive) of the outstanding shares of each class or series of ourstock. Our Board of Directors may exempt a person from this ownership limitunder specified conditions. Absent an exemption or a waiver, shares of stockthat are purportedly transferred in excess of the ownership limit will beautomatically transferred to a trust for the exclusive benefit of one or morecharitable beneficiaries, and the purported transferee will not acquire anyrights in such shares. This ownership limit could delay or prevent a change incontrol of the company and, therefore, could adversely affect the stockholders’ability to realize a premium over the then-prevailing market price for ourshares.

***We are dependent on external sources of capital, whichmay not be available.******  ***Toqualify as a REIT, we must, among other things, distribute to our stockholderseach year at least 90% of our REIT taxable income (excluding any net capitalgains). In order to eliminate federal income tax, we will be required todistribute annually 100% of our net taxable income (including capital gains).Because of these distribution requirements, we likely will not be able to fundall future capital needs, including capital for property development andacquisitions, with income from operations. We therefore will have to rely onthird-party sources of capital, which may or may not be available on favorableterms or at all. Our access to third-party sources of capital depends on anumber of things, including the market’s perception of our growth potential andour current and potential future earnings and our ability to continue toqualify as a REIT for federal income tax purposes.

*Tax Risks*

***Failure of thecompany to qualify as a REIT would have serious adverse consequences tostockholders.***   We believe that the companyhas qualified for taxation as a REIT for federal income tax purposes since September 28,1998, the date of the merger of our predecessor companies, New Plan RealtyTrust and Excel Realty Trust, Inc., and that our predecessor companiesqualified for taxation as REITs for federal income tax purposes since theirfirst elections to be taxed as REITs and for each taxable year where a failureto qualify would adversely affect the company. We plan to continue to operateso that the company meets the requirements for taxation as a REIT. Many ofthese requirements, however, are highly technical and complex. Thedetermination that the company is a REIT requires an analysis of variousfactual matters and circumstances that may not be totally within our control.For example, to qualify as a REIT, at least 95% of our gross income must comefrom certain sources that are itemized in the REIT tax laws. We are alsorequired to distribute to stockholders at least 90% of our REIT taxable income(excluding any net capital gains). The fact that we hold certain of our assetsthrough partnerships and their subsidiaries further complicates the applicationof the REIT requirements. Even a technical or inadvertent mistake couldjeopardize the company’s REIT status. Furthermore, Congress and the InternalRevenue Service might make changes to the tax laws and regulations, and thecourts might issue new rulings, that make it more difficult, or impossible, forthe company to remain qualified as a REIT.

If the company fails to qualify as a REIT and anyavailable relief provisions do not apply, the company would not be allowed totake a deduction for distributions to stockholders in computing its taxableincome, and it would be subject to federal and state income tax (including any applicable alternative minimum tax)at regular corporate rates. Also, unless the Internal Revenue Service grantedthe company relief under certain statutory provisions, the company would remaindisqualified as a REIT for four years following the year the company firstfailed to qualify. If the company failed to qualify as a REIT, the companywould 

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have to pay significantincome taxes and would therefore have less money available for investments,debt service and dividends to stockholders. This likely would have asignificant adverse affect on the value of our securities. In addition, wewould no longer be required to pay any dividends to stockholders.

Even if the company qualifies as a REIT for federalincome tax purposes, we are required to pay certain federal, state and localtaxes on our income and property. For example, we will pay tax on any nettaxable income or gain that we do not distribute in a taxable year. We may alsobe subject to a 4% nondeductible excise tax on the amount, if any, by which distributionspaid by us in any calendar year are less than sum of 85% of our ordinaryincome, 95% of our capital gain net income and 100% of our undistributed incomefrom prior years.

In addition, if we have net income from “prohibitedtransactions,” that income will be subject to a 100% tax. In general,prohibited transactions are sales or other dispositions of property heldprimarily for sale to customers in the ordinary course of business. Thedetermination as to whether a particular sale is a prohibited transactiondepends on the facts and circumstances related to that sale. While we haveundertaken a significant number of asset sales in recent years, we do notbelieve that those sales should be considered prohibited transactions, butthere can be no assurance that the Internal Revenue Service would not contendotherwise. The need to avoid this penaltytax could cause us to forego or defer sales of our properties that we mightotherwise have sold or that might otherwise be in our best interest to sell orto own and sell such properties through a taxable REIT subsidiary. A taxableREIT subsidiary would be subject to a corporate level tax on its taxable incomeattributable to such sales.

Any net taxable income earned directly by our taxableaffiliates, including ERT Development Corporation, is subject to federal, stateand local corporate income tax. The taxation of the company at the state andlocal levels may differ from the federal income tax treatment of the company.To the extent that we and our affiliates are required to pay federal, state andlocal taxes, we will have less cash available for investment, debt service, and distributions to our stockholders.

Subject to certain exceptions, including the onediscussed in this paragraph, a REIT is generally prohibited from owningsecurities in any one issuer if the value of those securities exceeds 5% of thevalue of the REIT’s total assets or the securities owned by the REIT representmore than 10% of the issuer’s outstanding voting securities or more than 10% ofthe value of the issuer’s outstanding securities. A REIT is permitted to ownsecurities of a subsidiary in an amount that exceeds the 5% value test and the10% vote or value test if the subsidiary elects to be a “taxable REITsubsidiary,” which is taxable as a corporation. However, a REIT may not ownsecurities of taxable REIT subsidiaries that represent in the aggregate morethan 20% of the value of the REIT’s total assets. We currently own 100% of theoutstanding securities of ERT Development Corporation, which elected, effectiveJanuary 1, 2001, to be a taxable REIT subsidiary of ours. Each corporatesubsidiary in which ERT Development Corporation owns more than 35% of theoutstanding voting securities or more than 35% of the value of the outstandingsecurities will also be treated as a taxable REIT subsidiary of ours. While webelieve that we have satisfied the limitations on the ownership of securitieswith regard to our ownership of interests in ERT Development Corporation duringeach of the taxable years that each such limitation applied to us, given thehighly complex nature of the rules governing REITs and the ongoingimportance of factual determinations, we cannot provide any assurance that theInternal Revenue Service would not disagree with our determination.

Several provisions of the applicable tax laws ensurethat a taxable REIT subsidiary will be subject to an appropriate level offederal income taxation. For example, a taxable REIT subsidiary is limited inits ability to deduct interest payments made to an affiliated REIT. Inaddition, the REIT has to pay a 100% penalty tax if the economic arrangementsbetween the REIT, the REIT’s tenants, and a taxable REIT subsidiary are notcomparable to similar arrangements between unrelated parties.

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***The company could be disqualified as a REIT or have topay taxes if its predecessor companies did not qualify as REITs.***   Ifeither New Plan Realty Trust or Excel Realty Trust, Inc., whose businesseswere combined in a merger transaction on September 28, 1998 to form thecompany, failed to qualify as a REIT throughout the duration of its existence,we might have had undistributed “C corporation earnings and profits.” If thatwere the case and either of our predecessor companies did not distribute suchearnings and profits prior to the merger transaction, the company might notqualify as a REIT. We believe that each of the predecessor companies qualifiedas a REIT and that, in any event, neither of the predecessor companies had anyundistributed “C corporation earnings and profits” at the time of the mergertransaction. If New Plan Realty Trust failed to qualify as a REIT, it wouldhave recognized taxable gain at the time of the merger transaction (and wewould be liable for the tax on that gain). This would be the case even thoughthe merger transaction qualified as a “tax-free reorganization,” unless we madea special election that was available under the law at the time of the merger.We made that election with respect to the assets acquired from New Plan RealtyTrust. This election has the effect of requiring us, if New Plan Realty Trustwas not qualified as a REIT, to pay corporate income tax on any gain existingat the time of the merger transaction on assets acquired in the transaction ifthose assets are sold within 10 years after the transaction. Finally, ifeither of the predecessor companies did not qualify as a REIT, the companycould have been precluded from electing REIT status for up to four years afterthe year in which that predecessor company failed to qualify if the companywere determined to be a “successor” to that predecessor company.

**Item1B.****            *UnresolvedStaff Comments***

None.

21

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***Item 2.****                       **Properties*

The following table setsforth certain information as of December 31, 2006 regarding ourConsolidated Portfolio properties on a state-by-state basis:

| ** **     | ** ** | **Number of** | ** ** | **Percent**    | ** ** | ** ** | ** ** | **Percent of** | ** ** |
|----------------|------------|--------------------|------------|----------------|------------|------------|------------|---------------------|------------|
| **State**      | ** ** | ** **         | ** ** | **Properties** | ** ** | **Leased** | ** ** | **GLA (1)**    | ** ** | **Scheduled ABR (2)** | ** ** |
| Alabama        |       |               | 6          |           |       |       | 91.6       | %                   |       | 703,686 |   |   | 1.1 | % |   |
| Arizona        |       |               | 3          |           |       |       | 86.8       | %                   |       | 601,212 |   |   | 1.3 | % |   |
| Arkansas       |       |               | 1          |           |       |       | 100.0      | %                   |       | 60,842 |   |   | 0.0 | % |   |
| California     |       |               | 11         |           |       |       | 94.6       | %                   |       | 1,726,058 |   |   | 6.2 | % |   |
| Colorado       |       |               | 2          |           |       |       | 98.1       | %                   |       | 364,580 |   |   | 1.3 | % |   |
| Connecticut    |       |               | 1          |           |       |       | 92.6       | %                   |       | 97,086 |   |   | 0.3 | % |   |
| Delaware       |       |               | 1          |           |       |       | 100.0      | %                   |       | 30,000 |   |   | 0.0 | % |   |
| Florida        |       |               | 28         |           |       |       | 90.0       | %                   |       | 4,754,531 |   |   | 13.9 | % |   |
| Georgia        |       |               | 21         |           |       |       | 94.0       | %                   |       | 2,488,139 |   |   | 5.8 | % |   |
| Illinois       |       |               | 10         |           |       |       | 93.0       | %                   |       | 1,759,856 |   |   | 5.4 | % |   |
| Indiana        |       |               | 6          |           |       |       | 89.2       | %                   |       | 828,289 |   |   | 1.5 | % |   |
| Iowa           |       |               | 2          |           |       |       | 71.4       | %                   |       | 279,826 |   |   | 0.3 | % |   |
| Kentucky       |       |               | 9          |           |       |       | 96.7       | %                   |       | 1,709,912 |   |   | 3.7 | % |   |
| Louisiana      |       |               | 3          |           |       |       | 99.3       | %                   |       | 345,573 |   |   | 0.5 | % |   |
| Maryland       |       |               | 2          |           |       |       | 72.1       | %                   |       | 163,161 |   |   | 0.3 | % |   |
| Massachusetts  |       |               | 2          |           |       |       | 82.2       | %                   |       | 343,532 |   |   | 0.6 | % |   |
| Michigan       |       |               | 16         |           |       |       | 90.6       | %                   |       | 2,207,848 |   |   | 5.7 | % |   |
| Minnesota      |       |               | 1          |           |       |       | 93.7       | %                   |       | 55,715 |   |   | 0.1 | % |   |
| Nevada         |       |               | 2          |           |       |       | 74.4       | %                   |       | 311,512 |   |   | 0.7 | % |   |
| New Jersey     |       |               | 7          |           |       |       | 98.5       | %                   |       | 818,353 |   |   | 2.4 | % |   |
| New Mexico     |       |               | 2          |           |       |       | 100.0      | %                   |       | 97,384 |   |   | 0.2 | % |   |
| New York       |       |               | 15         |           |       |       | 87.2       | %                   |       | 2,014,432 |   |   | 5.7 | % |   |
| North Carolina |       |               | 10         |           |       |       | 95.9       | %                   |       | 1,375,925 |   |   | 2.2 | % |   |
| Ohio           |       |               | 24         |           |       |       | 85.0       | %                   |       | 4,235,138 |   |   | 8.6 | % |   |
| Oklahoma       |       |               | 1          |           |       |       | 90.3       | %                   |       | 186,851 |   |   | 0.5 | % |   |
| Pennsylvania   |       |               | 11         |           |       |       | 87.1       | %                   |       | 2,117,696 |   |   | 5.5 | % |   |
| Rhode Island   |       |               | 1          |           |       |       | 93.2       | %                   |       | 148,126 |   |   | 0.4 | % |   |
| South Carolina |       |               | 4          |           |       |       | 91.2       | %                   |       | 807,866 |   |   | 1.7 | % |   |
| Tennessee      |       |               | 15         |           |       |       | 90.8       | %                   |       | 2,194,443 |   |   | 4.1 | % |   |
| Texas          |       |               | 64         |           |       |       | 92.0       | %                   |       | 7,210,072 |   |   | 17.0 | % |   |
| Virginia       |       |               | 7          |           |       |       | 90.6       | %                   |       | 941,257 |   |   | 2.1 | % |   |
| Wisconsin      |       |               | 1          |           |       |       | 100.0      | %                   |       | 198,419 |   |   | 0.4 | % |   |
| Wyoming        |       |               | 1          |           |       |       | 89.5       | %                   |       | 155,022 |   |   | 0.3 | % |   |
|           |       |               | 290        |           |       |       | 90.7       | %                   |       | 41,332,342 |   |   | 100.0 | % |   |
| **Region (3)** | ** ** |               |       |           |       |       |       |                | ** ** | ** ** | ** ** |   |   |   |   |
| East           |       |               | 70         |           |       |       | 91.1       | %                   |       | 10,567,346 |   |   | 24.7 | % |   |
| Midwest        |       |               | 60         |           |       |       | 88.1       | %                   |       | 9,720,113 |   |   | 22.4 | % |   |
| South          |       |               | 139        |           |       |       | 91.7       | %                   |       | 17,944,137 |   |   | 43.0 | % |   |
| West           |       |               | 21         |           |       |       | 91.6       | %                   |       | 3,100,746 |   |   | 9.8 | % |   |
|           |       |               | 290        |           |       |       | 90.7       | %                   |       | 41,332,342 |   |   | 100.0 | % |   |
|                |            |                    |            |                |            |            |            |                     |            |  |  |  |  |  |  |  |  |

----

(1)          GLArepresents gross leasable area in square feet.

(2)          ABRrepresents 2006 scheduled ABR based on contractual minimum lease payments as ofDecember 31, 2006.

(3)          NCREIFRegions

Ofthe****290 properties in ourConsolidated Portfolio, 286 properties are held in fee simple, and fourproperties are held pursuant to ground leases, which ground leases constitutean aggregate of 0.5 million rentable square feet and expire between 2027 and2031.

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As of December 31,2006, we owned interests in 467 properties, including 177 properties heldthrough unconsolidated joint ventures. The following table sets forth certaininformation as of December 31, 2006 regarding our properties on astate-by-state basis, and includes our pro rata share of unconsolidated jointventure properties:

| ** **     | ** ** | **Number of** | ** ** | **Percent**    | ** ** | ** ** | ** ** | **Percent of** | ** ** |
|----------------|------------|--------------------|------------|----------------|------------|------------|------------|---------------------|------------|
| **State**      | ** ** | ** **         | ** ** | **Properties** | ** ** | **Leased** | ** ** | **GLA (1)**    | ** ** | **Scheduled ABR (2)** | ** ** |
| Alabama        |       |               | 10         |           |       |       | 92.2       | %                   |       | 810,115 |   |   | 1.4 | % |   |
| Arizona        |       |               | 5          |           |       |       | 86.8       | %                   |       | 611,391 |   |   | 1.2 | % |   |
| Arkansas       |       |               | 2          |           |       |       | 96.8       | %                   |       | 69,868 |   |   | 0.0 | % |   |
| California     |       |               | 14         |           |       |       | 94.6       | %                   |       | 1,752,127 |   |   | 5.9 | % |   |
| Colorado       |       |               | 6          |           |       |       | 98.1       | %                   |       | 542,667 |   |   | 1.9 | % |   |
| Connecticut    |       |               | 13         |           |       |       | 94.6       | %                   |       | 244,404 |   |   | 0.8 | % |   |
| Delaware       |       |               | 1          |           |       |       | 100.0      | %                   |       | 30,000 |   |   | 0.0 | % |   |
| Florida        |       |               | 44         |           |       |       | 90.3       | %                   |       | 4,915,990 |   |   | 13.5 | % |   |
| Georgia        |       |               | 38         |           |       |       | 94.0       | %                   |       | 2,756,651 |   |   | 6.0 | % |   |
| Illinois       |       |               | 12         |           |       |       | 93.0       | %                   |       | 1,801,436 |   |   | 5.2 | % |   |
| Indiana        |       |               | 8          |           |       |       | 89.2       | %                   |       | 837,218 |   |   | 1.4 | % |   |
| Iowa           |       |               | 3          |           |       |       | 72.5       | %                   |       | 293,299 |   |   | 0.3 | % |   |
| Kansas         |       |               | 1          |           |       |       | 94.3       | %                   |       | 5,132 |   |   | 0.0 | % |   |
| Kentucky       |       |               | 14         |           |       |       | 96.8       | %                   |       | 1,759,569 |   |   | 3.6 | % |   |
| Louisiana      |       |               | 6          |           |       |       | 99.3       | %                   |       | 375,415 |   |   | 0.5 | % |   |
| Maine          |       |               | 2          |           |       |       | 100.0      | %                   |       | 13,702 |   |   | 0.0 | % |   |
| Maryland       |       |               | 2          |           |       |       | 72.1       | %                   |       | 163,161 |   |   | 0.3 | % |   |
| Massachusetts  |       |               | 6          |           |       |       | 82.7       | %                   |       | 361,825 |   |   | 0.6 | % |   |
| Michigan       |       |               | 22         |           |       |       | 90.4       | %                   |       | 2,273,892 |   |   | 5.5 | % |   |
| Minnesota      |       |               | 1          |           |       |       | 93.7       | %                   |       | 55,715 |   |   | 0.1 | % |   |
| Mississippi    |       |               | 3          |           |       |       | 54.2       | %                   |       | 13,156 |   |   | 0.0 | % |   |
| Nevada         |       |               | 3          |           |       |       | 75.3       | %                   |       | 325,263 |   |   | 0.7 | % |   |
| New Hampshire  |       |               | 2          |           |       |       | 100.0      | %                   |       | 11,122 |   |   | 0.0 | % |   |
| New Jersey     |       |               | 8          |           |       |       | 98.5       | %                   |       | 821,193 |   |   | 2.3 | % |   |
| New Mexico     |       |               | 3          |           |       |       | 98.9       | %                   |       | 103,685 |   |   | 0.2 | % |   |
| New York       |       |               | 24         |           |       |       | 88.0       | %                   |       | 2,152,653 |   |   | 5.8 | % |   |
| North Carolina |       |               | 19         |           |       |       | 96.0       | %                   |       | 1,454,691 |   |   | 2.3 | % |   |
| Ohio           |       |               | 35         |           |       |       | 85.1       | %                   |       | 4,383,704 |   |   | 8.4 | % |   |
| Oklahoma       |       |               | 2          |           |       |       | 92.5       | %                   |       | 245,774 |   |   | 0.7 | % |   |
| Pennsylvania   |       |               | 16         |           |       |       | 87.3       | %                   |       | 2,155,087 |   |   | 5.2 | % |   |
| Rhode Island   |       |               | 1          |           |       |       | 93.2       | %                   |       | 148,126 |   |   | 0.4 | % |   |
| South Carolina |       |               | 9          |           |       |       | 91.3       | %                   |       | 828,021 |   |   | 1.7 | % |   |
| Tennessee      |       |               | 26         |           |       |       | 90.8       | %                   |       | 2,247,583 |   |   | 4.0 | % |   |
| Texas          |       |               | 86         |           |       |       | 92.2       | %                   |       | 7,606,218 |   |   | 17.3 | % |   |
| Virginia       |       |               | 13         |           |       |       | 91.1       | %                   |       | 1,001,215 |   |   | 2.1 | % |   |
| West Virginia  |       |               | 3          |           |       |       | 93.0       | %                   |       | 18,031 |   |   | 0.0 | % |   |
| Wisconsin      |       |               | 3          |           |       |       | 99.3       | %                   |       | 212,314 |   |   | 0.4 | % |   |
| Wyoming        |       |               | 1          |           |       |       | 89.5       | %                   |       | 155,022 |   |   | 0.3 | % |   |
|           |       |               | 467        |           |       |       | 90.9       | %                   |       | 43,556,435 |   |   | 100.0 | % |   |
| **Region (3)** | ** ** |               |       |           |       |       |       |                | ** ** | ** ** | ** ** |   |   |   |   |
| East           |       |               | 133        |           |       |       | 91.5       | %                   |       | 11,162,800 |   |   | 25.1 | % |   |
| Midwest        |       |               | 85         |           |       |       | 88.1       | %                   |       | 9,862,710 |   |   | 21.3 | % |   |
| South          |       |               | 217        |           |       |       | 91.9       | %                   |       | 19,040,770 |   |   | 43.3 | % |   |
| West           |       |               | 32         |           |       |       | 91.9       | %                   |       | 3,490,155 |   |   | 10.2 | % |   |
|           |       |               | 467        |           |       |       | 90.9       | %                   |       | 43,556,435 |   |   | 100.0 | % |   |
|                |            |                    |            |                |            |            |            |                     |            |  |  |  |  |  |  |  |  |

----

(1)          GLArepresents gross leasable area in square feet.

(2)          ABRrepresents 2006 scheduled ABR based on contractual minimum lease payments as ofDecember 31, 2006.

(3)          NCREIF Regions

23

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Thefollowing table sets forth a schedule of lease expirations for leases in placewithin our Consolidated Portfolio as of December 31, 2006 (excludingPointe*Orlando, a wholly-owned property currently undergoing significantredevelopment), for each of the next ten years and thereafter, assuming noexercise of renewal options or base rent escalations over the lease term.

| ** ** | ** ** | **Number of**       | ** ** | **Leased** | ** ** | **Percent of** | ** ** | **ABR**           | ** ** | **Percent of** | ** ** |
|------------|------------|--------------------------|------------|------------|------------|---------------------|------------|-------------------|------------|---------------------|------------|
| ** ** | ** ** | **Leases Expiring** | ** ** | **GLA**    | ** ** | **GLA**             | ** ** | **Per Foot** | ** ** | **Total ABR**  | ** ** |
| 2007       |       |                     | 1,017      |       |       | 3,971,149           |       |              | 10.67      | %                   |       |   | $ | 10.01 |   |   |   | 11.90 | % |   |
| 2008       |       |                     | 914        |       |       | 4,347,843           |       |              | 11.69      | %                   |       |   | 9.52 |   |   |   | 12.39 | % |   |
| 2009       |       |                     | 867        |       |       | 4,316,522           |       |              | 11.60      | %                   |       |   | 9.89 |   |   |   | 12.78 | % |   |
| 2010       |       |                     | 617        |       |       | 4,779,062           |       |              | 12.85      | %                   |       |   | 8.48 |   |   |   | 12.13 | % |   |
| 2011       |       |                     | 577        |       |       | 4,007,814           |       |              | 10.77      | %                   |       |   | 8.98 |   |   |   | 10.77 | % |   |
| 2012       |       |                     | 176        |       |       | 1,640,544           |       |              | 4.41       | %                   |       |   | 8.63 |   |   |   | 4.24 | % |   |
| 2013       |       |                     | 117        |       |       | 1,680,247           |       |              | 4.52       | %                   |       |   | 7.69 |   |   |   | 3.87 | % |   |
| 2014       |       |                     | 93         |       |       | 1,584,011           |       |              | 4.26       | %                   |       |   | 8.97 |   |   |   | 4.26 | % |   |
| 2015       |       |                     | 123        |       |       | 2,363,775           |       |              | 6.35       | %                   |       |   | 9.51 |   |   |   | 6.73 | % |   |
| 2016       |       |                     | 113        |       |       | 2,584,288           |       |              | 6.95       | %                   |       |   | 8.20 |   |   |   | 6.34 | % |   |
| 2017+      |       |                     | 173        |       |       | 5,929,959           |       |              | 15.94      | %                   |       |   | 8.22 |   |   |   | 14.59 | % |   |
|       |       |                     | 4,787      |       |       | 37,205,214          |       |              | 100.00     | %                   |       |   | $ | 8.98 |   |   |   | 100.00 | % |   |

 

The following table sets forth a schedule of leaseexpirations for leases in place as of December 31, 2006 (including our prorata share of unconsolidated joint venture properties, but excludingPointe*Orlando, a wholly-owned property currently undergoing significantredevelopment), for each of the next ten years and thereafter, assuming noexercise of renewal options or base rent escalations over the lease term.

| ** ** | ** ** | **Number of**       | ** ** | **Leased** | ** ** | **Percent of** | ** ** | **ABR**           | ** ** | **Percent of** | ** ** |
|------------|------------|--------------------------|------------|------------|------------|---------------------|------------|-------------------|------------|---------------------|------------|
| ** ** | ** ** | **Leases Expiring** | ** ** | **GLA**    | ** ** | **GLA**             | ** ** | **Per Foot** | ** ** | **Total ABR**  | ** ** |
| 2007       |       |                     | 1,535      |       |       | 4,103,216           |       |              | 10.44      | %                   |       |   | $ | 10.09 |   |   |   | 11.59 | % |   |
| 2008       |       |                     | 1,420      |       |       | 4,546,366           |       |              | 11.56      | %                   |       |   | 9.58 |   |   |   | 12.19 | % |   |
| 2009       |       |                     | 1,356      |       |       | 4,512,747           |       |              | 11.48      | %                   |       |   | 9.92 |   |   |   | 12.53 | % |   |
| 2010       |       |                     | 1,019      |       |       | 5,033,564           |       |              | 12.80      | %                   |       |   | 8.62 |   |   |   | 12.15 | % |   |
| 2011       |       |                     | 884        |       |       | 4,231,773           |       |              | 10.76      | %                   |       |   | 9.20 |   |   |   | 10.90 | % |   |
| 2012       |       |                     | 303        |       |       | 1,763,901           |       |              | 4.49       | %                   |       |   | 8.87 |   |   |   | 4.38 | % |   |
| 2013       |       |                     | 218        |       |       | 1,783,829           |       |              | 4.54       | %                   |       |   | 7.98 |   |   |   | 3.98 | % |   |
| 2014       |       |                     | 198        |       |       | 1,706,098           |       |              | 4.34       | %                   |       |   | 9.09 |   |   |   | 4.34 | % |   |
| 2015       |       |                     | 225        |       |       | 2,505,267           |       |              | 6.37       | %                   |       |   | 9.60 |   |   |   | 6.73 | % |   |
| 2016       |       |                     | 183        |       |       | 2,694,871           |       |              | 6.85       | %                   |       |   | 8.37 |   |   |   | 6.31 | % |   |
| 2017+      |       |                     | 342        |       |       | 6,437,445           |       |              | 16.37      | %                   |       |   | 8.26 |   |   |   | 14.89 | % |   |
|       |       |                     | 7,683      |       |       | 39,319,077          |       |              | 100.00     | %                   |       |   | $ | 9.09 |   |   |   | 100.00 | % |   |

 

***Item 3.****                       **Legal Proceedings*

We are not presentlyinvolved in any material litigation arising outside the ordinary course of ourbusiness. However, we are involved in routine litigation arising in theordinary course of business, none of which is believed to be material in lightof reserves taken by us.

***Item 4.****                        Submissionof Matters to a Vote of Security Holders*

No matters were submitted to a vote of ourstockholders during the fourth quarter of 2006.

24

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**PART II**

***Item 5.****                       **Market for Registrant’s Common Equity, Related Stockholder Matters andIssuer Purchases of Equity Securities*

Ourcommon stock is listed on the New York Stock Exchange under the symbol “NXL”. Asof February 21, 2007, there were approximately 3,297 registered recordholders of our common stock. The following table shows the high and low salesprices, as reported by the New York Stock Exchange composite tape, and the cashdividends declared each calendar quarter during 2006 and 2005 for our commonstock:

| ** **     | ** ** | **High**   | ** ** | **Low**    | ** ** | **Cash  Dividends  Declared** | ** ** |
|----------------|------------|------------|------------|------------|------------|-------------------------------|------------|
| **2005:**      | ** ** | ** ** | ** ** | ** ** | ** ** |                          | ** ** | ** ** |   |
| First quarter  |       | $          | 27.35      |       | $          | 24.83                         |       |   | $ | 0.4125 |   |   |
| Second quarter |       | 27.91      |       | 24.50      |       |                          | 0.4125     |   |   |
| Third quarter  |       | 28.65      |       | 22.39      |       |                          | 3.3125     | (1) |   |
| Fourth quarter |       | 24.55      |       | 20.18      |       |                          | 0.3125     |   |   |
| **2006:**      | ** ** | ** ** | ** ** | ** ** | ** ** |                          | ** ** | ** ** |   |
| First quarter  |       | $          | 26.42      |       | $          | 23.07                         |       |   | $ | 0.3125 |   |   |
| Second quarter |       | 25.95      |       | 22.80      |       |                          | 0.3125     |   |   |
| Third quarter  |       | 27.75      |       | 24.35      |       |                          | 0.3125     |   |   |
| Fourth quarter |       | 28.93      |       | 26.67      |       |                          | 0.3125     |   |   |

----

(1)          Dividends declared forthe third quarter 2005 include a special dividend of $3.00 per common share(the “Special Dividend”), which was paid on September 27, 2005 to commonstockholders of record on August 25, 2005. In connection with the paymentof the Special Dividend and the closing of a transfer of approximately $968.0million of our assets to a joint venture, we reduced our regular quarterlydividend from $0.4125 per share of common stock to $0.3125 per share of commonstock.

We declared dividends of approximately $151.1 millionfor the year ended December 31, 2006 (amount does not include increases tothe dividend payable on our Series D depository shares to account for the “step-up”in the dividend rate).

Distributions to stockholders are usually taxable asordinary income, although a portion of the dividend may be designated ascapital gain or may constitute a tax-free return of capital. Annually, weprovide each of our stockholders a statement detailing distributions paidduring the preceding year and their characterization as ordinary income,capital gain or return of capital.

We intend to continue todeclare quarterly distributions. However, we cannot provide any assurance as tothe amount or timing of future distributions. Under our existing AmendedRevolving Facility and Amended Secured Term Loan (together, “Credit Agreements”),we are restricted from paying common stock dividends that would exceed 95% ofour funds from operations during any four-quarter period, except as necessaryto protect our REIT status.

25

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*Notwithstandinganything to the contrary set forth in any of our filings under the SecuritiesAct of 1933, as amended, or the Securities Exchange Act of 1934, as amended,that might incorporate Securities and Exchange Commission filings, in whole orin part, the following performance graph will not be incorporated by referenceinto any such filings.*

**PERFORMANCE GRAPH**

The following graph compares the cumulative totalstockholder return of our common stock for the period from December 31,2001 to December 31, 2006 to the S&P 500 Index and to the publishedFTSE NAREIT Equity REIT Index over the same five-year period. The graph assumesthat the value of the investment in our common stock and each index was $100 atDecember 31, 2001 and that all dividends were reinvested. The stockholderreturn shown on the graph below is not indicative of future performance.

**COMPARISON OF 5YEAR CUMULATIVE TOTAL RETURN***AmongNew Plan Excel Realty Trust, Inc., The S & P 500 IndexAnd The FTSE NAREIT Equity REIT Index

*                    $100 investedon 12/31/01 in stock or index-including reinvestment of dividends. Fiscal yearending December 31.

Copyright© 2007, Standard & Poor’s, a division of The McGraw-HillCompanies, Inc. All rights reserved.www.researchdatagroup.com/S&P.htm

| **Index**                               | ** ** | ** ** | ** ** | **12/31/01** | ** ** | **12/31/02** | ** ** | **12/31/03** | ** ** | **12/31/04** | ** ** | **12/31/05** | ** ** | **12/31/06** | ** ** |   |
|-----------------------------------------|------------|------------|------------|--------------|------------|--------------|------------|--------------|------------|--------------|------------|--------------|------------|--------------|------------|--------|
| New Plan Excel  Realty Trust, Inc. |       |       | 100.00     |         |       |         | 108.95     |         |       |         | 151.58     |         |       |         | 177.40     |   |   |   | 181.60 |   |   |   | 223.21 |   |   |
| S&P 500                             |       |       | 100.00     |         |       |         | 77.90      |         |       |         | 100.24     |         |       |         | 111.15     |   |   |   | 116.61 |   |   |   | 135.03 |   |   |
| FTSE NAREIT Equity REIT  Index          |       |       | 100.00     |         |       |         | 103.82     |         |       |         | 142.37     |         |       |         | 187.33     |   |   |   | 210.12 |   |   |   | 283.78 |   |   |

 

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**Item 6.****                       ***Selected Financial Data*

The financial informationincluded in the following table has been derived from the audited consolidatedfinancial statements for the periods indicated. This information should be readtogether with our audited financial statements and Management’s Discussion andAnalysis of the Financial Condition and Results of Operations includedelsewhere in this Annual Report on Form 10-K.

| ** **                                                                        | ** ** | **Years Ended December 31,**                           | ** ** |
|-----------------------------------------------------------------------------------|------------|-----------------------------------------------------------------------|------------|
| ** **                                                                        | ** ** | **2006**                                                              | ** ** | **2005** | ** ** | **2004** | ** ** | **2003** | ** ** | **2002** | ** ** |
| ** **                                                                        | ** ** | **(In thousands, except per share amounts)** | ** ** |
| **Statement  of Income Data:**                                                    | ** ** | ** **                                                            | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** |
| Rental revenues:                                                                  |       |                                                                  |       |   |   |   |   |   |   |   |   |
| Rental income                                                                     |       | $                                                                     | 334,349    |   | $ | 358,869 |   | $ | 367,511 |   | $ | 343,823 |   | $ | 274,154 |   |
| Percentage rents                                                                  |       | 4,903                                                                 |       | 5,811 |   | 5,979 |   | 6,347 |   | 5,389 |   |
| Expense  reimbursements                                                           |       | 101,063                                                               |       | 97,656 |   | 92,824 |   | 93,381 |   | 73,405 |   |
| Fee income                                                                        |       | 16,660                                                                |       | 10,957 |   | 4,797 |   | 5,265 |   | 5,266 |   |
| Total rental  revenues                                                            |       | 456,975                                                               |       | 473,293 |   | 471,111 |   | 448,816 |   | $ | 358,214 |   |
| Expenses:                                                                         |       |                                                                  |       |   |   |   |   |   |   |   |   |
| Operating costs                                                                   |       | 72,672                                                                |       | 75,511 |   | 79,221 |   | 81,929 |   | 58,895 |   |
| Real estate taxes                                                                 |       | 59,564                                                                |       | 64,414 |   | 58,572 |   | 55,867 |   | 42,544 |   |
| Depreciation and  amortization                                                    |       | 88,905                                                                |       | 89,973 |   | 86,487 |   | 71,862 |   | 59,558 |   |
| Provision for  doubtful accounts                                                  |       | 7,922                                                                 |       | 11,167 |   | 8,763 |   | 6,815 |   | 8,342 |   |
| General and  administrative                                                       |       | 28,674                                                                |       | 26,361 |   | 17,674 |   | 19,807 |   | 17,837 |   |
| Total expenses                                                                    |       | 257,737                                                               |       | 267,426 |   | 250,717 |   | 236,280 |   | 187,176 |   |
| Income before real  estate sales, minority interest and other income and expenses |       | 199,238                                                               |       | 205,867 |   | 220,394 |   | 212,536 |   | 171,038 |   |
| Other income and expenses:                                                        |       |                                                                  |       |   |   |   |   |   |   |   |   |
| Interest, dividend  and other income                                              |       | 4,016                                                                 |       | 4,219 |   | 3,517 |   | 4,130 |   | 5,734 |   |
| Equity in income  of unconsolidated ventures                                      |       | 5,143                                                                 |       | 4,045 |   | 1,513 |   | 3,438 |   | 5,245 |   |
| Interest expense                                                                  |       | (94,202                                                               | )          | (118,043 | ) | (106,054 | ) | (100,987 | ) | (92,071 | ) |
| Foreign currency  loss                                                            |       | —                                                                |       | — |   | — |   | — |   | (13 | ) |
| Impairment of real  estate                                                        |       | —                                                                |       | (859 | ) | (43 | ) | (3,536 | ) | (67,600 | ) |
| Minority interest  in income of consolidated partnership and joint ventures       |       | (745                                                                  | )          | (5,953 | ) | (853 | ) | (1,554 | ) | (642 | ) |
| Income from  continuing operations                                                |       | 113,450                                                               |       | 89,276 |   | 118,474 |   | 114,027 |   | 21,691 |   |
| Discontinued operations:                                                          |       |                                                                  |       |   |   |   |   |   |   |   |   |
| Results of  discontinued operations                                               |       | 8,025                                                                 |       | 12,353 |   | 15,476 |   | 17,929 |   | 39,293 |   |
| Gain (loss) on  sale of discontinued operations                                   |       | 14,648                                                                |       | 17,787 |   | (1,139 | ) | 4,018 |   | 99,046 |   |
| Impairment of real  estate held for sale                                          |       | (907                                                                  | )          | — |   | (88 | ) | (6,953 | ) | (39,961 | ) |
| Income from  discontinued operations                                              |       | 21,766                                                                |       | 30,140 |   | 14,249 |   | 14,994 |   | 98,378 |   |
| Income before gain  on sale of real estate                                        |       | 135,216                                                               |       | 119,416 |   | 132,723 |   | 129,021 |   | 120,069 |   |
| Gain on sale of  real estate                                                      |       | 1                                                                     |       | 186,908 |   | 1,217 |   | — |   | 1,993 |   |
| Net income                                                                        |       | $                                                                     | 135,217    |   | $ | 306,324 |   | $ | 133,940 |   | $ | 129,021 |   | $ | 122,062 |   |
| Net income  available to common stock—basic                                  |       | $                                                                     | 113,251    |   | $ | 284,436 |   | $ | 112,470 |   | $ | 107,221 |   | $ | 108,036 |   |
| Net income  available to common stock—diluted                                |       | $                                                                     | 113,996    |   | $ | 289,506 |   | $ | 113,266 |   | $ | 108,776 |   | $ | 108,678 |   |
| Basic earnings per common share:                                                  |       |                                                                  |       |   |   |   |   |   |   |   |   |
| Earnings per  share—continuing operations                                    |       | $                                                                     | 0.88       |   | $ | 2.46 |   | $ | 0.98 |   | $ | 0.95 |   | $ | 0.11 |   |
| Earnings per share—discontinued  operations                                  |       | 0.21                                                                  |       | 0.29 |   | 0.13 |   | 0.15 |   | 1.03 |   |
| Basic earnings per  common share                                                  |       | $                                                                     | 1.09       |   | $ | 2.75 |   | $ | 1.11 |   | $ | 1.10 |   | $ | 1.14 |   |
| Diluted earnings per common share:                                                |       |                                                                  |       |   |   |   |   |   |   |   |   |
| Earnings per  share—continuing operations                                    |       | $                                                                     | 0.85       |   | $ | 2.43 |   | $ | 0.97 |   | $ | 0.93 |   | $ | 0.11 |   |
| Earnings per share—discontinued  operations                                  |       | 0.20                                                                  |       | 0.28 |   | 0.13 |   | 0.15 |   | 1.02 |   |
| Diluted earnings  per common share                                                |       | $                                                                     | 1.05       |   | $ | 2.71 |   | $ | 1.10 |   | $ | 1.08 |   | $ | 1.13 |   |
| Average shares  outstanding—basic                                            |       | 104,102                                                               |       | 103,393 |   | 100,894 |   | 97,318 |   | 95,119 |   |
| Average shares  outstanding—diluted                                          |       | 108,814                                                               |       | 106,834 |   | 103,345 |   | 100,269 |   | 96,552 |   |
| **Other Data:**                                                                   | ** ** | ** **                                                            | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** |
| Distributions per  common share (1)                                          |       | $                                                                     | 1.25       |   | $ | 4.45 |   | $ | 1.65 |   | $ | 1.65 |   | $ | 1.65 |   |
| **Balance Sheet Data as of the End of Each Period:**                              |       |                                                                  |       |   |   |   |   |   |   |   |   |
| Net real estate                                                                   |       | $                                                                     | 3,135,547  |   | $ | 3,016,262 |   | $ | 3,559,763 |   | $ | 3,294,037 |   | $ | 3,269,476 |   |
| Total assets                                                                      |       | 3,534,899                                                             |       | 3,369,762 |   | 3,831,742 |   | 3,558,596 |   | 3,515,279 |   |
| Long term debt,  net (2)                                                     |       | 1,834,360                                                             |       | 1,644,881 |   | 1,996,319 |   | 1,776,004 |   | 1,713,476 |   |
| Total liabilities                                                                 |       | 2,032,677                                                             |       | 1,820,717 |   | 2,160,797 |   | 1,934,588 |   | 1,902,996 |   |
| Minority interest  in consolidated partnership and joint ventures                 |       | 57,485                                                                |       | 57,659 |   | 30,784 |   | 37,865 |   | 39,434 |   |
| Total  stockholders’ equity                                                  |       | 1,444,737                                                             |       | 1,491,386 |   | 1,640,161 |   | 1,586,143 |   | 1,572,849 |   |

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(1)             Amount for the year ended December 31, 2005includes the Special Dividend of $3.00 per common share, which was paid on September 27,2005 to common stockholders of record on August 25, 2005.

(2)             Long-term debt includes mortgage loans, net, notespayable, net, capital leases and credit agreements.

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***Item 7.****                       **Management’s Discussion and Analysis of Financial Condition and Resultsof Operations*

**Critical AccountingPolicies**

Our consolidated financialstatements include our accounts and those of our wholly-owned andmajority-owned subsidiaries and consolidated variable interest entities. Thepreparation of financial statements in conformity with accounting principlesgenerally accepted in the United States (“GAAP”) requires us to make estimatesand assumptions in certain circumstances that affect amounts reported in theaccompanying consolidated financial statements and related footnotes. Inpreparing these financial statements, we have made our best estimates andjudgments of certain amounts included in the financial statements, giving dueconsideration to materiality. We do not believe there is a great likelihoodthat materially different amounts would be reported related to the accountingpolicies described below. However, application of these accounting policiesinvolves the exercise of judgment and use of assumptions as to futureuncertainties and, as a result, actual results could differ from these estimates.

*Revenue Recognition*

We recognize rental revenue on a straight-line basis,which averages minimum rents over the terms of the leases. The cumulativedifference between lease revenue recognized under this method and contractuallease payment terms is recorded as “deferred rent receivable” on ourconsolidated balance sheets. Certain leases provide for percentage rents basedupon the level of sales achieved by the lessee. These percentage rents arerecorded once the required sales levels are achieved. Leases also typicallyprovide for tenant reimbursements of common area maintenance and otheroperating expenses. Rental income also includes lease termination fees.

We must make estimates of the uncollectability of ouraccounts receivables related to base rents, expense reimbursements and otherrevenue or income. We specifically analyze accounts receivable and historicalbad debts, customer concentrations, customer credit worthiness, currenteconomic trends and changes in our customer payment terms when evaluating theadequacy of the allowance for doubtful accounts. These estimates have a directimpact on our net income, because a higher bad debt reserve results in less netincome.

The SEC’s Staff AccountingBulletin (“SAB”) No. 104, *Revenue Recognition*(“SAB104”),**provides guidance on the application ofGAAP to selected revenue recognition issues. We have concluded that our revenuerecognition policy is appropriate and in accordance with GAAP and SAB 104.

*Real Estate*

Land, buildings and building and tenant improvementsare recorded at cost and stated at cost less accumulated depreciation. Majorreplacements and betterments, which improve or extend the life of the asset,are capitalized and depreciated over their estimated useful lives; ordinaryrepairs and maintenance, are expensed as incurred. Land, buildings and buildingand tenant improvements that are under redevelopment, or are being developed,are carried at cost and no depreciation is recorded on these assets. Additionally,amounts essential to the development of the property, such as pre-constructioncosts, development costs, construction costs, interest costs, real estatetaxes, salaries and related costs, and other costs incurred during the periodof development are capitalized. We cease capitalization when the property isavailable for occupancy upon substantial completion of tenant improvements, butin any event no later than one year from the completion of major constructionactivity.

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Propertiesare depreciated using the straight-line method over the estimated useful livesof the assets. The estimated useful lives are as follows:

| Buildings             |   | 35 to 40 years                                               |
|-----------------------|--------|--------------------------------------------------------------|
| Building improvements |   | 5 to 40 years                                                |
| Tenant improvements   |   | The shorter of the term of the related lease or  useful life |

 

We are required to makesubjective assessments as to the useful lives of our properties for purposes ofdetermining the amount of depreciation to reflect on an annual basis. Theseassessments have a direct impact on our net income. For example, if we were tolengthen the expected useful life of a particular building improvement, theimprovement would be depreciated over a greater number of years, resulting inless depreciation expense and higher net income on an annual basis.

*BusinessCombinations*

In connection with our acquisition of properties,purchase costs are allocated to the tangible and intangible assets andliabilities acquired based on their estimated fair values. The value of thetangible assets, consisting of land, buildings and building and tenantimprovements, are determined as if vacant (i.e., at replacement cost). Intangibleassets, including the above-market value of leases and the value of in-placeleases, are recorded at their relative fair values. The below-market value ofleases is recorded in Other liabilities on our Consolidated Balance Sheets.

Above-market, below-market and in-place lease valuesfor owned properties are recorded based on the present value (using an interestrate reflecting the risks associated with the leases acquired) of thedifference between (i) the contractual amounts to be paid pursuant to theleases negotiated and in-place at the time of acquisition and (ii) management’sestimate of fair market lease rates for the property or equivalent property,measured over a period equal to the remaining non-cancelable term of the lease.The capitalized above-market or below-market lease value is amortized as areduction of, or increase to, rental income over the remaining non-cancelableterm of each lease plus any renewal periods with fixed rental terms that areconsidered to be below-market.

The total amount of other intangible assets allocatedto in-place lease values and tenant relationship intangible values is based onmanagement’s evaluation of the specific characteristics of each lease and our overallrelationship with each tenant. Factors considered in the allocation of thesevalues include, but are not limited to, the nature of the existing relationshipwith the tenant, the tenant’s credit quality, the expectation of leaserenewals, the estimated carrying costs of the property during a hypotheticalexpected lease-up period, current market conditions and the costs to executesimilar leases. Management will also consider information obtained about aproperty in connection with its pre-acquisition due diligence. Estimatedcarrying costs include real estate taxes, insurance, other property operatingcosts and estimates of lost rentals at market rates during the hypotheticalexpected lease-up periods, based on management’s assessment of specific marketconditions. Management will estimate costs required to execute leases includingcommissions and legal costs to the extent that such costs are not alreadyincurred with a new lease that has been negotiated in connection with thepurchase of a property. Independent appraisals and/or management’s estimateswill be used to determine these values.

The value of in-place leases is amortized to expenseover the remaining initial term of each lease. The value of tenant relationshipintangibles is amortized to expense over the initial terms of the leases;however, no amortization period for intangible assets will exceed the remainingdepreciable life of the building.

In the event that a tenantterminates its lease, the unamortized portion of each intangible, includingmarket rate adjustments, lease origination costs, in-place values and tenantrelationship values, will be charged as an expense.

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*Long Lived Assets*

On a periodic basis, management assesses whether thereare any indicators that the value of the real estate properties may be impaired.A property’s value is impaired only if management’s estimate of the aggregatefuture cash flows (undiscounted and without interest charges) to be generatedby the property (taking into account the anticipated holding period of theasset) is less than the carrying value of the property. Such estimate of cashflows considers factors such as expected future operating income, trends andprospects, as well as the effects of demand, competition and other economicfactors. To the extent impairment has occurred, the loss will be measured asthe excess of the carrying amount of the property over the fair value of theproperty, and reflected as an adjustment to the basis of the property.

When assets are identified by management as held forsale, we discontinue depreciating the assets and estimate the sales price, netof selling costs, of such assets. If, in management’s opinion, the net salesprice of the assets that we have identified for sale is less than the net bookvalue of the assets, a valuation allowance is established. For investmentsaccounted for under the equity method, a loss is recognized if the loss invalue of the investment is other than temporary.

When we make subjectiveassessments as to whether there are impairments in the value of our real estateproperties, such assessments have a direct impact on our net income, becausetaking an impairment results in an immediate negative adjustment to net income.

**Recently IssuedAccounting Standards**

In September 2006, the SEC issued SAB No. 108,*Considering the Effects of Prior Year Misstatementswhen Quantifying Misstatements in Current Year Financial Statements*(“SAB No. 108”). SAB No. 108 provides guidance on how the effects ofuncorrected prior year misstatements should be considered when quantifyingcurrent year misstatements for the purpose of a materiality assessment. The SECstaff believes registrants must quantify misstatements using both a balancesheet and income statement approach and evaluate whether either approach resultsin quantifying a misstatement that, when all relevant quantitative andqualitative factors are considered, is material. SAB No. 108 is effectivefor the first annual period ending after November 15, 2006, with earlyapplication encouraged. We adopted SAB No. 108 in the quarter ended December 31,2006. The adoption of SAB No. 108 is not expected to have a materialimpact on our consolidated financial statements.

In September 2006, the FASB issued Statement No. 157,*Fair Value Measurements* (“SFAS No. 157”).SFAS No. 157 defines fair value, establishes a framework for measuringfair value in accordance with GAAP and expands disclosure requirementsregarding fair value measurements. SFAS No. 157 is effective for financialstatements issued for fiscal years beginning after November 15, 2007, andinterim periods within those fiscal years. Earlier application is encouraged,provided that the reporting entity has not yet issued financial statements forsuch fiscal year, including financial statements for an interim period withinsuch fiscal year. The adoption of SFAS No. 157 is not expected to have amaterial impact on our consolidated financial statements.

In June 2006, the FASB issued Interpretation No. 48,*Accounting for Uncertainty in Income Taxes—anInterpretation of FASB Statement No. 109* (“FIN 48”). FIN 48 (i) clarifiesthe accounting for uncertainty in income taxes recognized in companies’financial statements in accordance with FASB Statement No. 109, *Accounting for Income Taxes*, (ii) prescribes arecognition threshold and measurement attribute for the financial statementrecognition and measurement of a tax position taken or expected to be taken ina tax return and (iii) provides guidance on derecognition of recognizedtax benefits, classification, interest and penalties, accounting in interimperiods, disclosure and transition. FIN 48 is effective for fiscal yearsbeginning after December 15, 2006. We are currently evaluating the impactof the adoption of FIN 48 on our consolidated financial statements.

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In March 2006, the FASB issued StatementNo. 156, *Accounting for Servicing of Financial Assets—anamendment of FASB Statement No. 140* (“SFAS No. 156”). SFASNo. 156 (i) clarifies when an obligation to service financial assetsshould be separately recognized as a servicing asset or a servicing liability,(ii) requires that a separately recognized servicing asset or servicingliability be initially measured at fair value, if practicable, and(iii) permits an entity with a separately recognized servicing asset orservicing liability to choose either the amortization method or the fair valuemethod for subsequent measurement. SFAS No. 156 is effective for fiscalyears beginning after September 15, 2006, but early adoption is permitted.The adoption of SFAS No. 156 is not expected to have a material impact onour consolidated financial statements.

In February 2006, theFASB issued Statement No. 155, *Accounting for CertainHybrid Financial Instruments—an amendment of FASB Statements No. 133 and140* (“SFAS No. 155”). SFAS No. 155 (i) permits fairvalue remeasurement for any hybrid financial instrument that contains anembedded derivative that otherwise would require bifurcation,(ii) clarifies which interest-only strips and principal-only strips are notsubject to the requirements of SFAS No. 133, (iii) establishes arequirement to evaluate interests in securitized financial assets to identifyinterests that are freestanding derivatives or that are hybrid financialinstruments that contain an embedded derivative requiring bifurcation,(iv) clarifies that concentrations of credit risk in the form ofsubordination are not embedded derivatives and (v) amends FASB StatementNo. 140, *Accounting for Transfers and Servicing ofFinancial Assets and Extinguishment of Liabilities*, to eliminate theprohibition on a qualifying special-purpose entity from holding a derivativefinancial instrument that pertains to a beneficial interest other than anotherderivative financial instrument. SFAS No. 155 is effective for all financialinstruments acquired or issued after the beginning of an entity’s first fiscalyear that begins after September 15, 2006. The adoption of SFASNo. 155 is not expected to have a material impact on our consolidatedfinancial statements.

**Results ofOperations**

The following discussion should be read in conjunctionwith the Consolidated Financial Statements and the accompanying notes thereto. Historicalresults and percentage relationships set forth in the Consolidated Statementsof Income and Comprehensive Income contained in the Consolidated FinancialStatements and accompanying notes, including trends which might appear, shouldnot be taken as indicative of future operations.

During 2006, we acquired four shopping centers(Shoppes at Hickory Hollow, The Quentin Collection, Fox Run Mall and MemphisCommons), two buildings immediately adjacent to properties owned by us(Building at Tarpon Mall and Building at Hazel Path), the remaining 90%interests in two shopping centers in which we owned the other 10% interests (VenturaDowns and Odessa-Winwood Town Center), six land parcels, and a leaseholdinterest in a new development project (collectively, the “2006 Acquisitions”).

On August 10, 2005, we completed the sale andcontribution of 69 community and neighborhood shopping centers (the “GalileoProperties”) to Galileo America LLC for approximately $968.0 million of totalconsideration (the “Property Transfer”). As a result of a series of relatedtransactions that occurred simultaneously with the closing of the Property Transfer,we own an approximately 5.0% equity interest in Galileo America LLC, which, asof December 31, 2006, owned 135 real estate assets. In addition, weacquired a recurring asset management fee stream and a minimum 20 year feestream for all property management, leasing, development, acquisition anddisposition fees related to Galileo America LLC (such transactions are referredto collectively with the Property Transfer as the “Galileo Transactions”). As aresult of our  retained 5% equityownership interest in Galileo America LLC, as well as our acquisition of theproperty and asset management rights as part of the Galileo Transactions, theresults of operations of the Galileo Properties were not classified asdiscontinued operations for the years ended December 31, 

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2006, 2005 and 2004. Accordingly,our results of operations for the years ended December 31, 2006, 2005 and2004 include the results of operations of the Galileo Properties.

During 2005, we acquired eight shopping centers(Brunswick Town Center, Hillcrest Shopping Center, West Ridge Shopping Center,Market Plaza, Surrey Square Mall, Fashion Place Shopping Center, Western HillsPlaza and Southland Shopping Center), a vacant building with 2.5 acres of landimmediately adjacent to Midway Crossing, a shopping center owned by us, avacant building immediately adjacent to Victory Square, a shopping center ownedby us, six land parcels, the remaining 90% interest in Marketplace at Wycliffe,a shopping center in which we owned the other 10% interest, and the remaining90% interest in Mableton Walk, a shopping center in which we owned the other10% interest (collectively, the “2005 Acquisitions”). Accordingly, our resultsof operations for the years ended December 31, 2006 and 2005 include theresults of operations of the 2005 Acquisitions.

During 2004, we acquired 11 shopping centers (NewBritain Village Square, Elk Grove Town Center, Villa Monaco, Florence Square,Stockbridge Village, Starlite Plaza, Village Center, Annex of Arlington,Marketplace, Silver Pointe, and The Shoppes at Southside), 11 acres ofunimproved land known as Unity Plaza, the remaining 50% interest in ClearwaterMall, a shopping center in which we owned the other 50% interest, and theremaining 50% interest in The Market at Preston Ridge, a shopping center inwhich we owned the other 50% interest (collectively, the “2004 Acquisitions”). Accordingly,our results of operations for the years ended December 31, 2006, 2005 and2004 include the results of operations of the 2004 Acquisitions.

In accordance with theprovisions of FIN 46 and EITF 04-5 our consolidated results of operationsfor the years ended December 31, 2006, 2005 and 2004 include the resultsof operations of certain of our joint ventures (collectively, “ConsolidationAdjustments”), as applicable.

Inaccordance with the provisions of SFAS No. 144, *Accounting for the Impairment or Disposal of Long-Lived Assets,* the results of operations of properties thathave been disposed of (by sale, by abandonment, or in a distribution to owners)or classified as held for sale must be classified as discontinued operationsand segregated in our Consolidated Statements of Income and ComprehensiveIncome. Therefore, results of operations from prior periods have been restatedto reflect the current pool of disposed of or held for sale assets.

***Results of Operations for theTwelve Months Ended December 31, 2006 and 2005***

***Revenues:***

Total revenues decreased $16.3 million, or 3%, from$473.3 million in 2005 to $457.0 million in 2006. Significant changes arediscussed below.

Rental incomedecreased $24.6 million, or 7%, from $358.9 million in 2005 to $334.3 millionin 2006. The following factors accounted for this variance:

·       2006Acquisitions, which increased rental income by approximately $2.1 million

·       2005Acquisitions, which increased rental income by approximately $8.5 million

·       ConsolidationAdjustments, which increased rental income by approximately $1.0 million

·       Netincreases in rental rates and straight-line rent adjustments, which increased rentalincome by approximately $9.6 million

·       Increasedlease settlement income, which increased rental income by approximately $1.9million

·       Thesale of the Galileo Properties, which decreased rental income by approximately$47.3 million

·       Decreasedspecialty rent, which decreased rental income by approximately $0.4 million

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Percentage rentsdecreased $0.9 million, or 16%, from $5.8 million in 2005 to $4.9 million in2006. The following factors accounted for this variance:

·       2005Acquisitions, which increased percentage rents by approximately $0.1 million

·       Thesale of the Galileo Properties, which decreased percentage rents byapproximately $0.4 million

·       Highertenant sales breakpoints associated with contractual lease terms, combined withcertain tenants who are now paying annual minimum rents in lieu of percentagerents, which decreased percentage rents by approximately $0.6 million

Expensereimbursements increased $3.4 million, or 3%, from $97.7 million in 2005 to$101.1 million in 2006. The following factors accounted for this variance:

·       2006Acquisitions, which increased expense reimbursements by approximately $0.3million

·       2005Acquisitions, which increased expense reimbursements by approximately $2.7million

·       ConsolidationAdjustments, which increased expense reimbursements by approximately $0.2million

·       Anet increase in the amount of reimbursable real estate taxes, which increasedexpense reimbursements by approximately $2.1 million

·       Anet increase in the amount of reimbursable property operating expenses,including electricity, insurance, water and sewer expenses, which increasedexpense reimbursements by approximately $8.7 million

·       Thesale of the Galileo Properties, which decreased expense reimbursements byapproximately $10.6 million

Fee incomeincreased $5.7 million, or 52%, from $11.0 million in 2005 to $16.7 million in2006. Fee income is derived from services provided to our joint ventures andother managed projects, and the variances in the following fee revenues, whichare primarily attributable to an increase in the number of properties beingmanaged by us, accounted for the net increase in fee income:

·       Propertymanagement fee revenue, which increased fee income by approximately $4.6million

·       Leasingfee revenue, which increased fee income by approximately $0.5 million

·       Assetmanagement fee revenue, which increased fee income by approximately $1.6million

·       Acquisitionfee revenue, which decreased fee income by approximately $0.8 million

·       Financing fee revenue,which decreased fee income by approximately $0.2 million

***Operating Expenses:***

Total operating expenses decreased $9.7 million, or4%, from $267.4 million in 2005 to $257.7 million in 2006. Significant changesare discussed below.

Operating costsdecreased $2.8 million, or 4%, from $75.5 million in 2005 to $72.7 million in2006. The following factors accounted for this variance:

·       2006Acquisitions, which increased operating costs by approximately $0.3 million

·       2005Acquisitions, which increased operating costs by approximately $2.1 million

·       ConsolidationAdjustments, which increased operating costs by approximately $0.2 million

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·       Increasedpayroll and payroll related expenses, attributable to increased personnellevels necessary to administer the growing number of properties undermanagement, which increased operating costs by approximately $1.4 million

·       Costsrecorded for conditional asset retirement obligations in accordance with FASBInterpretation No. 47, *Accounting for ConditionalAsset Retirement Obligations*, and in anticipation of futureenvironmental remediation, which increased operating costs by approximately$0.3 million

·       Increasedinsurance expense, attributable to higher premiums under our renewed policy,which increased operating costs by approximately $1.3 million

·       Decreasedcapitalization with respect to our redevelopment projects, due to thecompletion of certain projects, which increased operating costs byapproximately $3.5 million

·       Thesale of the Galileo Properties, which decreased operating costs by approximately$9.5 million

·       Decreasedsnow removal costs, which decreased operating costs by approximately $0.4million

·       Decreasedlegal fees for tenant related matters, which decreased operating costs byapproximately $1.1 million

·       Combinednet decreases in maintenance, repair and utility expenses, which decreasedoperating costs by approximately $0.7 million

·       Decreasedadvertising and promotions expenses, which accounted for the balance of thevariance

Real estate taxesdecreased $4.8 million, or 7%, from $64.4 million in 2005 to $59.6 million in2006. The following factors accounted for this variance:

·       2006Acquisitions, which increased real estate taxes by approximately $0.2 million

·       2005Acquisitions, which increased real estate taxes by approximately $2.2 million

·       ConsolidationAdjustments, which increased real estate taxes by approximately $0.2 million

·       Decreasedcapitalization, attributable to the completion of certain redevelopmentprojects, which increased real estate taxes by approximately $0.7 million

·       Thesale of the Galileo Properties, which decreased real estate taxes byapproximately $7.2 million

·       Lowerassessments at certain properties, which decreased real estate taxes byapproximately $0.9 million

Depreciation andamortization decreased $1.1 million, or 1%, from $90.0 million in 2005 to $88.9million in 2006.  The following factorsaccounted for this variance:

·       2006Acquisitions, which increased depreciation and amortization by approximately$1.1 million

·       2005Acquisitions, which increased depreciation and amortization by approximately$4.3 million

·       ConsolidationAdjustments, which increased depreciation and amortization by approximately$0.6 million

·       Increaseddepreciation expense on properties previously under redevelopment, whichincreased depreciation and amortization by approximately $2.8 million

·       Increaseddeprecation expense on corporate assets, which increased depreciation andamortization by approximately $0.2 million

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·       Increasedamortization expense of intangible assets, which increased depreciation andamortization by approximately $0.2 million

·       Increasedamortization expense associated with amounts paid to acquire certain propertyand asset management rights in conjunction with the Galileo Transactions, whichincreased depreciation and amortization by approximately $1.1 million

·       Thesale of the Galileo Properties, which decreased depreciation and amortizationby approximately $11.4 million

Provision fordoubtful accounts decreased $3.3 million, or 29%, from $11.2 million in 2005 to$7.9 million in 2006. The following factors accounted for this variance:

·       2005Acquisitions, which in the aggregate increased provision for doubtful accountsby approximately $0.3 million

·       Reservestaken on properties previously under redevelopment, partially offset by lowerwrite-offs, which increased provision for doubtful accounts by approximately$1.9 million

·       Lowerreserve levels on the Galileo Properties, combined with the collection ofpreviously reserved receivables associated with these same properties, whichdecreased provision for doubtful accounts by approximately $5.5 million

General andadministrative expenses increased $2.3 million, or 9%, from $26.4 million in2005 to $28.7 million in 2006. The following factors accounted for thisvariance:

·       Increased payroll relatedexpenses, primarily attributable to the increased personnel levels necessary toservice the growth of properties under management in our portfolio, andcomprised of the following, which increased general and administrative expensesby approximately $4.7 million:

·        Increased payroll andpayroll related expenses of approximately $3.5 million

·        Increased compensationexpense, primarily attributable to stock-based awards granted during 2006, ofapproximately $1.1 million

·        Increased hiring costs ofapproximately $0.1 million

·       Costsincurred in connection with our increased offshore accounting efforts, whichincreased general and administrative expenses by approximately $1.4 million

·       Thewrite-off of pre-acquisition due diligence costs associated with an acquisitionthat did not materialize, combined with increased consulting expenses, whichincreased general and administrative expenses by approximately $0.3 million

·       Increasedtravel and promotion expenses, which increased general and administrativeexpenses by approximately $0.7 million

·       Decreasedallocation of costs to the properties, primarily attributable to lower regionaloffice costs, which increased general and administrative expenses byapproximately $0.2 million

·       Achange in accounting classification whereby expenses previously billed to theGalileo Properties and reflected as management fee income, an offset to generaland administrative expenses, are now classified as fee income in theconsolidated statement of operations, which change resulted in an increase ingeneral and administrative expenses by approximately $1.5 million

·       Decreasedrent expense, which decreased general and administrative expenses byapproximately $0.7 million

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·       Decreasedutilities expense, which decreased general and administrative expenses byapproximately $0.1 million

·       Reservestaken in 2005 in connection with specific tenant litigations, which decreasedgeneral and administrative expenses by approximately $2.8 million

·       Decreasedlegal fees, which decreased general and administrative expenses byapproximately $0.5 million

·       Thefollowing non-recurring expenses, which were recorded in 2005 in connectionwith the Galileo Transactions and the payment of the Special Dividend, whichdecreased general and administrative expenses by approximately $2.2 million:

**·****      **Personnelexpense of approximately $1.5 million

·        Additional stock optionexpense of approximately $0.7 million attributable to, and recorded as a resultof, the stock option revaluation resulting from the payment of the SpecialDividend

·       Decreased state taxexpense, attributable to the reversal of reserves previously taken, in light ofa recent evaluation of our state and franchise tax exposure, which decreasedgeneral and administrative expenses by approximately $0.2 million

***Other Income and Expenses:***

Equity in income ofunconsolidated ventures increased $1.1 million, or 28%, from $4.0 million in2005 to $5.1 million in 2006. The following factors accounted for thisvariance:

·       Increasedincome before depreciation, attributable to the following, which increasedequity in income unconsolidated ventures by approximately $7.7 million:

·        The operating performanceof Galileo America LLC, a joint venture in which we acquired an ownershipinterest in August 2005, which increased income before depreciation byapproximately $4.0 million

·        Increased operatingperformance of NP/I&G Institutional Retail Company, LLC, primarilyattributable to property acquisitions by the joint venture subsequent to January 1,2005, which increased income before depreciation by approximately $0.7 million

·        Increased operatingperformance of CA New Plan Acquisition Fund, LLC, primarily attributable toproperty acquisitions by the joint venture subsequent to January 1, 2005,which increased income before deprecation by approximately $0.2 million

·        Improved operatingperformance of BPR Shopping Center, L.P., which increased income beforedepreciation by approximately $3.0 million

·        A gain on the sale of landby BPR Land Partnership, L.P. in the first quarter of 2006, which increasedincome before depreciation by approximately $0.4 million

·        A gain on the sale ofRodney Village, a property owned by Benbrooke Ventures, a joint venture inwhich we formerly had a 50% interest, in the first quarter of 2005, whichdecreased income before depreciation by approximately $0.1 million

·        Decreased operatingperformance of CA New Plan Venture Fund, LLC, primarily due to property salesby the joint venture subsequent to January 1, 2005, which decreased incomebefore deprecation by approximately $0.5 million

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·       Increased depreciation,attributable to an increased number of operating properties owned by unconsolidatedventures, which decreased equity in income of unconsolidated ventures byapproximately $6.6 million

Interest expense decreased $23.8 million, or 20%, from$118.0 million in 2005 to $94.2 million in 2006. The following factorsaccounted for this variance:

·       Consolidation Adjustments,which increased interest expense by approximately $0.3 million

·       A higher interest rate onour then existing $150.0 million variable rate secured term loan (prior to August 2006amendments), which increased interest expense by approximately $2.5 million

·       Increased interest rates onour derivative financial instruments that convert fixed rate debt to variablerate debt, which increased interest expense by approximately $1.8 million

·       The 2005 write-off ofpremiums associated with the repayment of the secured mortgage indebtednessdiscussed below, which increased interest expense by approximately $4.2 million

·       A net decrease in interestexpense recorded on our outstanding notes payable, attributable to thefollowing transactions, which decreased interest expense by approximately$8.3 million:

**·****      **TheSeptember 2006 Debt Offering, which increased interest expense byapproximately $2.1 million

·        Thepublic offering of $125.0 million aggregate principal amount of senior unsecured,7-year fixed rate notes with a coupon of 5.125% and $125.0 millionaggregate principal amount of senior unsecured, 10-year fixed rate noteswith a coupon of 5.25% in September 2005 (collectively, the “September 2005Debt Offering”), which increased interest expense by approximately $9.3 million

·        Afull year of interest expense on our $100.0 million 5.30% unsecured seniornotes, due January 15, 2015, which increased interest expense byapproximately $0.2 million

·        Therepayment of $100.0 million in principal amount of our outstanding 7.75%unsecured senior notes, due April 5, 2005, with a portion of the proceedsfrom our then existing $150.0 million unsecured term loan (the “Unsecured TermLoan”) on April 5, 2005, which decreased interest expense by approximately$2.5 million

·        Therepayment of $250.0 million in principal amount of our outstanding 5.875%unsecured senior notes, due June 15, 2007, with the proceeds from the September 2005Debt Offering, which decreased interest expense by approximately $10.3 million

·        The2005 payment of accrued interest and a “make-whole” premium in connection withour redemption of all $250.0 million of our outstanding 5.875% senior notes dueJune 15, 2007, which decreased interest expense by approximately $7.1million

·       A decrease in the averagebalance outstanding under our then existing $350.0 million variable raterevolving credit facility, partially offset by a higher interest rate on suchrevolving credit facility, which decreased interest expense by approximately$1.1 million

·       The repayment of theUnsecured Term Loan in August 2005, which decreased interest expense byapproximately $2.3 million

·       A net decrease in theamount of mortgage debt outstanding, primarily attributable to the repayment ofapproximately $100.6 million of secured mortgage indebtedness with a portion ofthe proceeds from the Galileo Transactions, as well as the repayment of othermortgage indebtedness upon maturity, partially offset by the assumption ofmortgages in connection with the 2006 Acquisitions and 2005 Acquisitions, whichdecreased interest expense by approximately $5.4 million

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·       Prepaymentpenalties incurred in connection with the 2005 repayment of the securedmortgage indebtedness discussed above, which decreased interest expense byapproximately $11.2 million

·       Decreasedamortization of debt issuance costs, primarily attributable to thenon-recurring write-off in 2005 of unamortized issuance costs associated withour then outstanding 5.875% unsecured notes, which decreased interest expenseby approximately $1.1 million

·       Increasedcapitalized interest with respect to our redevelopment projects, due toincreased interest rates and increased project spending, which decreasedinterest expense by approximately $3.2 million

Minority interest inincome of consolidated partnership and joint ventures decreased $5.3 million,from $6.0 million for the year ended December 31, 2005 to $0.7 million forthe year ended December 31, 2006. This decrease is primarily attributableto the allocation of a portion of the gain from the sale of the GalileoProperties to the limited partners of Excel Realty Partners, L.P., a Delawarelimited partnership (“ERP”), in 2005, which allocation did not recur in 2006.

***Discontinued Operations:***

For the year ended December 31,2006, properties that had been either disposed of (by sale, abandonment, or ina distribution to owner) or classified as held for sale generated approximately$8.0 million, $14.6 million and $(0.9) million in results of operations, gainon sale and impairment of real estate held for sale, respectively. For the yearended December 31, 2005, such properties generated approximately $12.4million and $17.8 million in results of operations and gain on sale,respectively. Accordingly, these amounts have been classified as discontinuedoperations.

***Gain on Sale of Real Estate:***

***Gain on sale of real estate was approximately $186.9 millionfor the year ended December 31, 2005. This gain is directly attributableto the sale of the Galileo Properties in connection with the GalileoTransactions.***

**Results ofOperations for the Twelve Months Ended December 31, 2005 and 2004**

***Revenues:***

Total revenues increased $2.2 million, from $471.1million in 2004 to $473.3 million in 2005. Significant changes are discussedbelow.

Rental incomedecreased $8.6 million, or 2%, from $367.5 million in 2004 to $358.9 million in2005. The following factors accounted for this variance:

·       2005Acquisitions, which increased rental income by approximately $8.6 million

·       2004Acquisitions, which increased rental income by approximately $10.8 million

·       Increasesin occupancy and rental rates, which increased rental income by approximately$5.7 million

·       Increasedlease settlement income, which increased rental income by approximately $2.7million

·       Thesale of the Galileo Properties, which decreased rental income by approximately$28.0 million

·       Write-offsof straight-line rent balances related to certain tenant move-outs, primarilyat our properties under redevelopment, which decreased rental income byapproximately $2.6 million

·       Decreasedspecialty rent, which decreased rental income by approximately $0.2 million

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·       Increasedcapitalization with respect to our redevelopment projects, which decreasedrental income by approximately $5.2 million

·       Decreasesin cost of living adjustments, which accounted for the balance of the variance

Expensereimbursements increased $4.9 million, or 5%, from $92.8 million in 2004 to$97.7 million in 2005. The following factors accounted for this variance:

·       2005Acquisitions, which increased expense reimbursements by approximately $1.7million

·       2004Acquisitions, which increased expense reimbursements by approximately $4.9million

·       Anet increase in the amount of reimbursable real estate taxes, which increasedexpense reimbursements by approximately $4.2 million

·       Thesale of the Galileo Properties, which decreased expense reimbursements byapproximately $4.1 million

·       Anet decrease in the amount of reimbursable property operating expenses, whichdecreased expense reimbursements by approximately $1.0 million

·       Increasedcapitalization with respect to our redevelopment projects, which decreasedexpense reimbursements by approximately $0.8 million

Fee incomeincreased $6.2 million, or 129%, from $4.8 million in 2004 to $11.0 million in2005. Fee income is derived from services provided to our joint ventures andother managed projects, and the variances in the following fee revenues, whichare primarily attributable to an increase in the number of properties beingmanaged by us, accounted for the net increase in fee income:

·       Financingfee revenue, which increased fee income by approximately $0.1 million

·       Propertymanagement fee revenue, which increased fee income by approximately $3.0million

·       Leasingfee revenue, which increased fee income by approximately $1.0 million

·       Acquisitionfee revenue, which increased fee income by approximately $1.3 million

·       Asset management feerevenue, which increased fee income by approximately $0.8 million

***Operating Expenses:***

Total operating expenses increased $16.7 million, or7%, from $250.7 million in 2004 to $267.4 million in 2005. Significant changesare discussed below.

Operating costsdecreased $3.7 million, or 5%, from $79.2 million in 2004 to $75.5 million in2005. The following factors accounted for this variance:

·       2005Acquisitions, which increased operating costs by approximately $1.6 million

·       2004Acquisitions, which increased operating costs by approximately $1.7 million

·       Increasedpayroll and payroll related expenses, attributable to increased personnellevels and increased management fees, as a result of the increased number ofproperties under management, which increased operating costs by approximately$1.9 million

·       Combinedincreases in maintenance, repair and utility expenses, which increasedoperating costs by approximately $1.5 million

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·       Increased legal fees fortenant related matters, which increased operating costs by approximately $0.3million

·       Increasedsnow removal costs, which increased operating costs by approximately $0.3million

·       Thesale of the Galileo Properties, which decreased operating costs byapproximately $5.9 million

·       Decreasedinsurance expense attributable to lower premiums under our renewed insurancepolicy that went into effect in April 2005, which decreased operatingcosts by approximately $1.5 million

·       Increasedcapitalization with respect to our redevelopment projects, which decreasedoperating costs by approximately $3.6 million

Real estate taxesincreased $5.8 million, or 10%, from $58.6 million in 2004 to $64.4 million in2005. The following factors accounted for this variance:

·       2005Acquisitions, which increased real estate taxes by approximately $1.3 million

·       2004Acquisitions, which increased real estate taxes by approximately $4.1 million

·       Propertytax rate increases at certain municipalities, combined with higher assessmentsat certain properties, which increased real estate taxes by approximately $4.5million

·       Thesale of the Galileo Properties, which decreased real estate taxes byapproximately $3.6 million

·       Increasedcapitalization with respect to our redevelopment projects, which decreased realestate taxes by approximately $0.5 million

Depreciation andamortization increased $3.5 million, or 4%, from $86.5 million in 2004 to $90.0million in 2005.  The following factorsaccounted for this variance:

·       2005Acquisitions, which increased depreciation and amortization by approximately$3.5 million

·       2004Acquisitions, which increased depreciation and amortization by approximately$4.4 million

·       Increaseddepreciation expense attributable to increased tenant improvements, whichincreased depreciation and amortization by approximately $1.5 million

·       Increaseddepreciation expense on properties previously under redevelopment or classifiedas held for sale, which increased depreciation and amortization byapproximately $0.1 million

·       Increasedamortization expense attributable to increased deferred leasing commissions,which increased depreciation and amortization by approximately $0.4 million

·       Increasedamortization expense associated with amounts paid to acquire certain propertyand asset management rights in conjunction with the Galileo Transactions, whichincreased depreciation and amortization by approximately $0.6 million

·       Thesale of the Galileo Properties, which decreased depreciation and amortizationby approximately $7.0 million

Provision fordoubtful accounts increased $2.4 million, or 27%, from $8.8 million in 2004 to$11.2 million in 2005. The following factors accounted for this variance:

·       2005Acquisitions, which in the aggregate increased provision for doubtful accountsby approximately $0.1 million

·       2004Acquisitions, which in the aggregate increased provision for doubtful accountsby approximately $0.2 million

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·       Reservestaken in connection with the sale of the Galileo Properties, which increasedprovision for doubtful accounts by approximately $2.8 million

·       Increasedreserves taken for properties under redevelopment, which reserves werecapitalized and therefore decreased provision for doubtful accounts byapproximately $0.5 million

·       Increasedrecoveries of previously reserved amounts, primarily attributable to aggressivecollection efforts, which decreased provision for doubtful accounts byapproximately $0.2 million

General andadministrative expenses increased $8.7 million, or 49%, from $17.7 million in2004 to $26.4 million in 2005. The following factors accounted for thisvariance:

·       Increasedpayroll related expenses, attributable to the following factors, whichincreased general and administrative expenses by approximately $5.0 million:

·        Additional stock optionexpense of approximately $0.7 million attributable to, and recorded as a resultof, the stock option revaluation resulting from the payment of the SpecialDividend

**·****      **Additionalstock option expense of approximately $1.0 million taken in accordance with theprovisions of FASB Statement No. 123 (Revised 2004), *Share-BasedPayment* (“SFAS No. 123(R)”), for stock option grants awarded tocertain of our employees and members of our Board of Directors during 2005

**·****      **Additionalpersonnel expense of approximately $1.5 million recorded in conjunction withthe Galileo Transactions

**·****      **Increasedpersonnel levels and wage rates, which increased payroll related expenses byapproximately $1.8 million

·       Increasedrental expense and other office costs associated with our new corporate officelocation, which lease began in December 2004 and increased general andadministrative expenses by approximately $2.2 million

·       Increasedreserves taken in connection with specific tenant litigations, which increasedgeneral and administrative expenses by approximately $2.8 million

·       Increasedcosts incurred from offshore accounting services, partially offset by decreasedaccounting fees, primarily attributable to lower costs incurred in connectionwith complying with regulations under Section 404 of the Sarbanes-OxleyAct of 2002 as compared to 2004, which increased general and administrativeexpenses by approximately $0.8 million

·       Increasedtravel and promotion expenses, which increased general and administrativeexpenses by approximately $0.1 million

·       Decreasedstate tax expense, attributable to the reversal of reserves previously taken,in light of a recent evaluation of our state and franchise tax exposure, whichdecreased general and administrative expenses by approximately $1.6 million

·       Increasedallocation of costs to the properties, primarily attributable to higherregional office costs, which decreased general and administrative expenses byapproximately $0.6 million

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***Other Income and Expenses:***

Interest, dividendand other income increased $0.7 million, or 20%, from $3.5 million in 2004 to$4.2 million in 2005. The following factors accounted for this variance:

·       Interestearned on cash balances, primarily on the balance maintained during the periodbetween the closing of the Galileo Transactions on August 10, 2005 and thepayment of the Special Dividend on September 27, 2005, which increasedinterest, dividend and other income by approximately $1.6 million

·       ConsolidationAdjustments, which increased interest, dividend and other income byapproximately $0.1 million

·       Compensationfor an easement received in 2004, but not in 2005, which decreased interest,dividend and other income by approximately $0.1 million

·       Decreasedmortgage receivable balances, primarily attributable to the repayment of loansoutstanding, which decreased interest, dividend and other income byapproximately $0.9 million

Equity in income ofunconsolidated ventures increased $2.5 million, or 167%, from $1.5 million in2004 to $4.0 million in 2005. The following factors accounted for thisvariance:

·       Increasedincome before depreciation, attributable to the following, which increasedequity in income of unconsolidated ventures by approximately $4.6 million:

·        The operating performanceof Galileo America LLC, a joint venture in which we acquired an ownershipinterest in August 2005, which increased income before depreciation byapproximately $1.6 million

**·****      **Increasedoperating performance of NP/I&G Institutional Retail Company, LLC,primarily attributable to the acquisition of properties by the joint venturesubsequent to January 1, 2004, which increased equity in income ofunconsolidated ventures by approximately $2.0 million

**·****      **Improvedoperating performance of BPR Shopping Center, L.P., which increased income ofunconsolidated ventures by approximately $0.7 million

**·****      **Improvedoperating performance of Arapahoe Crossings, L.P., which increased income ofunconsolidated ventures by approximately $0.3 million

·       Increaseddepreciation, attributable to an increased number of operating properties ownedby unconsolidated ventures, which decreased equity in income of unconsolidatedventures by approximately $2.1 million

Interest expenseincreased $11.9 million, or 11%, from $106.1 million in 2004 to $118.0 millionin 2005. The following factors accounted for this variance:

·       Anincrease in the average balance outstanding under our then outstanding $350.0million revolving credit facility, compounded by a higher interest rate on ourthen outstanding revolving credit facility, which increased interest expense byapproximately $1.3 million

·       Ahigher interest rate on our then outstanding $150.0 million secured term loan,which increased interest expense by approximately $3.1 million

·       TheUnsecured Term Loan, which was entered into in the second quarter of 2005 andpaid off with a portion of the proceeds from the Galileo Transactions in thethird quarter of 2005, which increased interest expense by approximately $2.3million

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·       Increasedinterest expense on our derivative financial instruments that convert fixedrate debt to variable rate debt, which increased interest expense byapproximately $2.3 million

·       Increasedamortization of debt issuance costs, primarily attributable to the earlyrepayment of public debt, which increased interest expense by approximately$0.9 million

·       Thepayment of accrued interest and a “make-whole” premium in connection with ourredemption of all $250.0 million of our outstanding 5.875% senior notes due June 15,2007, which increased interest expense by approximately $7.1 million

·       Prepaymentpenalties incurred in connection with the repayment of the secured mortgageindebtedness discussed below, which increased interest expense by approximately$11.2 million

·       Anet decrease in the amount of mortgage indebtedness outstanding, attributableto the repayment of approximately $100.6 million of secured mortgageindebtedness with a portion of the proceeds from the Galileo Transactions, aswell as the repayment of other mortgage indebtedness upon maturity, partiallyoffset by the assumption of mortgages in connection with the 2005 Acquisitionsand 2004 Acquisitions, which decreased interest expense by approximately $5.0million

·       Thewrite-off of premiums associated with the repayment of the secured mortgageindebtedness discussed above, which decreased interest expense by approximately$3.0 million

·       Therepayment of $75.0 million of our 6.875% medium-term notes in April 2005with a portion of the proceeds from the Unsecured Term Loan, which decreasedinterest expense by approximately $5.8 million

·       Adecrease in the balance outstanding under our fixed rate REMIC, attributable toongoing scheduled payments, which decreased interest expense by approximately$0.2 million

·       Increasedcapitalized interest with respect to our redevelopment projects, due toincreased interest rates and increased project spending, which decreasedinterest expense by approximately $2.1 million

·       Decreasedfinancing fees, which accounted for the balance of the variance

Minority interest inincome of consolidated partnership and joint ventures increased $5.1 million,from $0.9 million for the year ended December 31, 2004 to $6.0 million forthe year ended December 31, 2005. This increase is primarily attributableto the allocation of a portion of the gain from the sale of the GalileoProperties in connection with the Galileo Transactions to the limited partnersof ERP.

***Discontinued Operations:***

For the year ended December 31,2005, properties that had been either disposed of (by sale, abandonment, or ina distribution to owner) or classified as held for sale generated approximately$12.4 million and $17.8 million in results of operations and gain on sale,respectively. For the year ended December 31, 2004, such propertiesgenerated approximately $14.6 million, $(0.1) million and $(1.1) million inresults of operations, impairment of real estate held for sale and loss onsale, respectively. Accordingly, these amounts have been classified asdiscontinued operations.

***Gainon Sale of Real Estate:***

***Gain on sale of real estate was approximately $186.9 millionfor the year ended December 31, 2005. This gain is directly attributableto the sale of the Galileo Properties in connection with the GalileoTransactions. Gain on sale of real estate was approximately $1.2 million forthe year ended December 31,***

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***2004. This amount represents our previously deferred gainincurred in connection with our sale of 70% of our interest in ArapahoeCrossings, L.P. in 2003.***

**Funds fromOperations**

Funds from Operations (“FFO”) is a widely usedperformance measure for real estate companies and is provided here as asupplemental measure of operating performance. We calculate FFO in accordancewith the best practices described in the April 2002 National PolicyBulletin of the National Association of Real Estate Investment Trusts (the “WhitePaper”). The White Paper defines FFO as net income (computed in accordance withGAAP), excluding gains (or losses) from sales of property, plus depreciationand amortization on real estate assets, and after adjustments forunconsolidated partnerships and joint ventures.

On October 1, 2003, the National Association ofReal Estate Investment Trusts (“NAREIT”), based on discussions with the SEC,provided revised guidance regarding the calculation of FFO. This revisedguidance provides that impairments should not be added back to net income incalculating FFO and that original issuance costs associated with preferredstock that has been redeemed should be factored into the calculation of FFO. Wepresent FFO in accordance with NAREIT’s revised guidance in the table set forthbelow.

Given the nature of our business as a real estateowner and operator, we believe that FFO is helpful to investors as a startingpoint in measuring our operational performance because it excludes variousitems included in net income that do not relate to or are not indicative of ouroperating performance, such as gains (or losses) from sales of property anddepreciation and amortization on real estate assets, which can make periodicand peer analyses of operating performance more difficult. However, it shouldbe noted that there are certain items, such as impairments, that are includedwithin the definition of FFO that do not relate to and are not indicative ofour operating performance. Furthermore, FFO should not be considered as analternative to net income (determined in accordance with GAAP) as an indicatorof our financial performance, is not an alternative to cash flow from operatingactivities (determined in accordance with GAAP) as a measure of our liquidity,and is not indicative of funds available to fund our cash needs, including ourability to make distributions. In addition, our computation of FFO may differ fromthe methodology utilized by other equity REITs to calculate FFO and, therefore,may not be comparable to such other REITs.

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Thefollowing information is provided to reconcile net income, the most comparableGAAP number, to FFO, and to show the items included in our FFO for the periodsindicated (dollars in thousands):

| ** **                                                                          | ** ** | **Year  Ended  December 31,  2006** | ** ** | **Year  Ended  December 31,  2005** | ** ** | **Year  Ended  December 31,  2004** | ** ** |
|-------------------------------------------------------------------------------------|------------|------------------------------------------|------------|------------------------------------------|------------|------------------------------------------|------------|
| Net income  available to common stockholders—diluted                           |       |                                     | $          | 113,996                                  |       |                                     |       | $ | 289,506 |   |   |   | $ | 113,266 |   |   |
| Deduct:                                                                             |       |                                     |       |                                     |       |                                     |       |   |   |   |   |   |   |
| Minority interest  in income of consolidated partnership, excluding gain allocation |       |                                     | (745       | )                                        |       |                                     | (714       | ) |   |   | (796 | ) |   |
| Net income  available to common stockholders—basic                             |       |                                     | 113,251    |                                     |       |                                     | 288,792    |   |   |   | 112,470 |   |   |
| Add:                                                                                |       |                                     |       |                                     |       |                                     |       |   |   |   |   |   |   |
| Depreciation and amortization                                                       |       |                                     |       |                                     |       |                                     |       |   |   |   |   |   |   |
| Continuing operations real estate assets                                            |       |                                     | 85,470     |                                     |       |                                     | 88,412     |   |   |   | 84,796 |   |   |
| Discontinued operations real estate assets                                          |       |                                     | 3,155      |                                     |       |                                     | 5,164      |   |   |   | 5,782 |   |   |
| Pro rata share of joint venture real estate assets                                  |       |                                     | 10,355     |                                     |       |                                     | 3,732      |   |   |   | 1,629 |   |   |
| Deduct:                                                                             |       |                                     |       |                                     |       |                                     |       |   |   |   |   |   |   |
| Gain on sale of  real estate (1)                                                    |       |                                     | (1         | )                                        |       |                                     | (186,908   | ) |   |   | (1,217 | ) |   |
| (Gain) loss on  sale of discontinued operations (1)                                 |       |                                     | (11,801    | )                                        |       |                                     | (11,818    | ) |   |   | 5,622 |   |   |
| Pro rata share of  joint venture (gain) loss on sale of real estate (1)             |       |                                     | (78        | )                                        |       |                                     | (406       | ) |   |   | 433 |   |   |
| **Funds  from operations—basic**                                               |       |                                     | 200,351    |                                     |       |                                     | 186,968    |   |   |   | 209,515 |   |   |
| Add:                                                                                |       |                                     |       |                                     |       |                                     |       |   |   |   |   |   |   |
| Minority interest  in income of consolidated partnership, excluding gain allocation |       |                                     | 745        |                                     |       |                                     | 714        |   |   |   | 796 |   |   |
| **Funds  from operations—diluted**                                             |       |                                     | $          | 201,096                                  |       |                                     |       | $ | 187,682 |   |   |   | $ | 210,311 |   |   |
| Net cash provided by operating activities                                           |       |                                     | $          | 209,157                                  |       |                                     |       | $ | 222,366 |   |   |   | $ | 221,955 |   |   |
| Net cash (used  in) provided by investing activities                                |       |                                     | (154,809   | )                                        |       |                                     | 636,105    |   |   |   | (254,294 | ) |   |
| Net cash (used in)  provided by financing activities                                |       |                                     | (55,634    | )                                        |       |                                     | (856,561   | ) |   |   | 34,303 |   |   |

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(1)          Excludesgain/loss on sale of land.

**Liquidity andCapital Resources**

As of December 31, 2006, we had approximately$13.8 million in available cash, cash equivalents and marketable securities. Asa REIT, we are required to distribute at least 90% of our taxable income to ourstockholders on an annual basis. Therefore, as a general matter, it is unlikelythat we will have any substantial cash balances that could be used to meet ourliquidity needs. Instead, these needs must be met from cash generated fromoperations and external sources of capital.

As of December 31, 2006, approximately $309.0million was available for draw under the Amended Revolving Facility.

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*Short-TermLiquidity Needs*

**Our short-term liquidityrequirements consist primarily of funds necessary to pay for operating andother expenses directly associated with our portfolio of properties (includingregular maintenance items), interest expense and scheduled principal paymentson our outstanding debt, capital expenditures incurred to facilitate theleasing of space (*e.g.*, tenant improvements andleasing commissions), capital expenditures incurred in our development andredevelopment projects, and quarterly dividends and distributions that we payto our common and preferred stockholders and holders of partnership units inERP. We believe that cash generated from operations and borrowings under theAmended Revolving Facility will be sufficient to meet our short-term liquidityrequirements; however, there are certain factors that may have a materialadverse effect on our cash flow from operations.**

We derive substantially all of our revenue fromtenants under existing leases at our properties. Therefore, our operating cashflow is dependent on the rents that we are able to charge to our tenants, andthe ability of these tenants to make their rental payments. We believe that thenature of the properties in which we typically invest—primarily community andneighborhood shopping centers—provides a more stable revenue flow in uncertaineconomic times because, even in difficult economic times, consumers still needto purchase basic living essentials such as food and soft goods. However,general economic downturns, or economic downturns in one or more markets inwhich we own properties, still may adversely impact the ability of our tenantsto make rental payments and our ability to re-lease space on favorable terms asleases expire. In either of these instances, our cash flow would be adverselyaffected.

We may acquire large portfolios of community andneighborhood shopping centers, either through direct acquisitions or businesscombinations. While we believe that the cash generated by any newly-acquiredproperties will more than offset the operating and interest expenses associatedwith those properties, it is possible that the properties may not perform aswell as expected and as a result, our cash needs may increase. In addition,there may be other costs incurred as a result of the acquisition of properties,including increased general and administrative costs while we integrate theproperties into our operating system.

In some cases, we have invested as a co-venturer orpartner in the development or redevelopment of new properties, instead ofdeveloping projects directly. Pursuant to the terms of certain of our jointventure agreements, we have outstanding commitments to contribute up to anaggregate of $5.5 million that may be required by such joint ventures. In additionto the committed amount, we have also agreed to contribute our pro rata shareof any additional capital that may be required by our joint ventures, which prorata share is not expected to be material. We expect to fund these capitalrequirements either out of excess cash from operations, or through draws on theAmended Revolving Facility.

During 2006, we completed ­17 redevelopment projectsin our Consolidated Portfolio, the aggregate cost of which, including costsincurred in prior years on these projects, was approximately $64.6 million. Ourcurrent redevelopment pipeline in our Consolidated Portfolio is comprised of 27projects, the aggregate cost of which, including costs incurred in prior yearson these projects, is expected to be approximately $189.4 million. Inaddition, during 2006, we completed ­four outparcel development projects in ourConsolidated Portfolio, the aggregate cost of which, including costs incurredin prior years on these projects, was approximately $8.0 million. Our currentoutparcel development pipeline in our Consolidated Portfolio is comprised ofnine projects, the aggregate cost of which, including costs incurred in prioryears on these projects, is expected to be approximately $22.2 million. Weintend on financing these redevelopment and outparcel development projectsthrough cash from operations or draws on the Amended Revolving Facility.

We also redevelop properties in our joint ventureportfolios and during 2006 we completed­ one redevelopment project, theaggregate cost of which, including costs incurred in prior years on thisproject, was approximately $3.9 million, of which our pro rata share wasapproximately $0.4 million. The current 

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joint ventureredevelopment pipeline is comprised of nine projects, the aggregate cost ofwhich, including costs incurred in prior years, is expected to be approximately$125.8 million, of which our pro rata share will be approximately $14.7 million.In addition, we also develop outparcels at properties in our joint ventureportfolios and during 2006, we completed two outparcel redevelopment projectsthrough out joint venture portfolios, the aggregate cost of which, includingcosts incurred in prior years on these projects, was approximately $6.0million, of which our pro rata share was approximately $0.3 million. Thecurrent outparcel development pipeline in our joint venture portfolios iscomprised of one project, the aggregate cost of which, including costs incurredin prior years on this project, is expected to be approximately $2.2 million,of which our pro rata share will be approximately $0.1 million. We intend onfinancing the redevelopment and outparcel development projects in our jointventure portfolios with a variety of financing vehicles as determined from timeto time by the joint venture.

We regularly incur significant expenditures inconnection with the re-leasing of our retail space, principally in the form oftenant improvements and leasing commissions. The amounts of these expenditurescan vary significantly, depending on negotiations with tenants and thewillingness of tenants to pay higher base rents over the lives of the leases. Weexpect to pay for these capital expenditures out of excess cash from operationsor, to the extent necessary, through draws on the Amended Revolving Facility. Webelieve that a significant portion of these expenditures is recouped in theform of continuing lease payments.

We have a common stock repurchase program pursuant towhich we may repurchase up to $75.0 million of our outstanding common stockthrough periodic open market transactions or through privately negotiatedtransactions. We also have a preferred stock and public debt repurchase programunder which we may repurchase up to $125.0 million of our outstanding preferredstock and public debt through periodic open market transactions or throughprivately negotiated transactions. No repurchases were made in 2006 under anyof these repurchase programs.

We also obtained separate authorization in September 2006to repurchase up to an additional $75.0 million of our outstanding common stockin connection with the September 2006 Debt Offering. Concurrently with theSeptember 2006 Debt Offering, pursuant to such separate authorization,1,863,600 shares of common stock were repurchased and retired at an averagepurchase price of $26.83 per share (approximately $50.0 million aggregatevalue). Due to the fact that we completed the offering on September 19,2006, no additional repurchases may be made pursuant to this authorization.

We currently pay a quarterlydividend of $0.3125 per share of common stock (or $1.25 per share on anannualized basis). We also pay regular quarterly dividends on our preferredstock. The maintenance of these dividends is subject to various factors,including the discretion of our Board of Directors, our ability to paydividends under Maryland law, the availability of cash to make the necessarydividend payments and the effect of REIT distribution requirements, whichrequire at least 90% of our taxable income be distributed to stockholders.  In addition, under the Amended RevolvingFacility and the Amended Secured Term Loan, we are restricted from payingcommon stock dividends that would exceed 95% of our Funds From Operations (asdefined in the applicable debt agreement) during any four-quarter period. Wealso make regular quarterly distributions on ERP units.

*Long-Term LiquidityNeeds*

Our long-term liquidity requirements consist primarilyof funds necessary to pay for the principal amount of our long-term debt as itmatures, significant non-recurring capital expenditures that need to be madeperiodically at our properties, redevelopment or development projects that weundertake at our properties and the costs associated with acquisitions ofproperties that we pursue. Historically, we have satisfied these requirementsprincipally through the most advantageous source of capital at the time, whichhas included the incurrence of new debt through borrowings (through publicofferings of unsecured debt 

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and private incurrence ofsecured and unsecured debt), sales of common and preferred stock, capitalraised through the disposition of assets, repayment by third parties of notesreceivable and joint venture capital transactions. We believe that thesesources of capital will continue to be available in the future to fund ourlong-term capital needs; however, there are certain factors that may have amaterial adverse effect on our ability to access these capital sources.

Our ability to incur additional debt is dependent upona number of factors, including our degree of leverage, the value of ourunencumbered assets, our credit rating and borrowing restrictions imposed byexisting lenders. Currently, we have investment grade credit ratings forprospective unsecured debt offerings from three major rating agencies—Standard &Poor’s (BBB), Moody’s Investor Service (Baa2) and Fitch Ratings (BBB+). Adowngrade in outlook or rating by a rating agency can occur at any time if theagency perceives an adverse change in our financial condition, results ofoperations or ability to service debt. If such a downgrade occurs, it wouldincrease the interest rate currently payable under our existing creditfacilities, it likely would increase the costs associated with obtaining futurefinancing, and it potentially could adversely affect our ability to obtainfuture financing.

Based on an internal evaluation, the estimated valueof our properties is above the outstanding amount of mortgage debt encumberingthe properties. Therefore, at this time, we believe that additional financingcould be obtained, either in the form of mortgage debt or additional unsecuredborrowings, and without violating the financial covenants contained in ourexisting debt agreements.

Our ability to raise funds through sales of commonstock and preferred stock is dependent on, among other things, general marketconditions for REITs, market perceptions about our company and the currenttrading price of our stock. We will continue to analyze which source of capitalis most advantageous to us at any particular point in time, but the equitymarkets may not be consistently available on attractive terms.

We have selectively effected asset sales to generatecash proceeds over the last two years. During 2006, we generated approximately$124.0 million in gross proceeds through the culling of non-core andnon-strategic properties and approximately $1.4 million from the disposition ofcertain properties and land parcels held through joint ventures. During 2005,we generated approximately $1.1 billion in gross proceeds through the GalileoTransactions, as well as the culling of non-core and non-strategic propertiesand approximately $17.1 million from the disposition of certain properties andland parcels held through joint ventures. Our ability to generate cash fromasset sales is limited by market conditions and certain rules applicableto REITs. Our ability to sell properties in the future in order to raise cashwill necessarily be limited if market conditions make such sales unattractive.

Thefollowing table summarizes all of our known contractual cash obligations,excluding interest, to pay third parties as of December 31, 2006 (based ona calendar year, dollars in thousands):

| **Contractual Cash Obligations** | ** ** | ** ** | ** ** | **Total** | ** ** | **Less than   1 year** | ** ** | **1- 3  years** | ** ** | **3 - 5  years** | ** ** | **More than  5 years** | ** ** |
|--------------------------------------------|------------|------------|------------|-----------|------------|---------------------------------------|------------|----------------------|------------|----------------------------|------------|----------------------------------|------------|
| Long-Term Debt  (1)                        |       | $          | 1,803,347  |      |       | $                                     | 62,239     |                 |       | $                          | 372,624    |                             | $          | 742,517 |   | $ | 625,967 |   |
| Capital Lease  Obligations                 |       | 27,500     |       |      | 410        |                                  |       | 918                  |       | 1,066                      |       | 25,106                           |       |
| Operating Leases (2)                       |       | 57,807     |       |      | 3,474      |                                  |       | 6,440                |       | 6,285                      |       | 41,608                           |       |
| Total                                      |       | $          | 1,888,654  |      |       | $                                     | 66,123     |                 |       | $                          | 379,982    |                             | $          | 749,868 |   | $ | 692,681 |   |

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(1)          Long-term debt includesscheduled amortization and scheduled maturities for mortgage loans, notespayable and credit facilities.

(2)          Operating leases includeground leases for shopping centers that we operate and our administrativeoffice space.

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We intend to repay our 2007 contractual cashobligations, which include approximately $32.6 million of maturing mortgagesand scheduled amortization and approximately $30.0 million of maturing notespayable, through draws under the Amended Revolving Facility, with proceedsgenerated through the sale of assets, with proceeds generated through theissuance of public or private secured or unsecured debt, or a combinationthereof.

Thefollowing table summarizes certain terms of our existing credit agreements asof December 31, 2006 (dollars in thousands):

| **Loan**                    | ** ** | ** ** | ** ** | **Amount Available   to be Drawn** | ** ** | **Amount Drawn as of   December 31, 2006** | ** ** | **Current Interest  Rate (1)** | ** ** | **Maturity Date** | ** ** |
|-----------------------------|------------|------------|------------|--------------------------------------------------------|------------|--------------------------------------------------------------------------|------------|------------------------------------------|------------|------------------------|------------|
| Amended Revolving  Facility |       |       | $          | 350,000                                                |       |                                                                     |       | $                                        | 41,000     |                   |       | LIBOR  plus 55 bp (2) |   | August 2010 |   |
| Amended Secured  Term Loan  |       |       | 150,000    |                                                   |       |                                                                     | 150,000    |                                     |       | LIBOR  plus 55 bp      |       | August 2010 |   |
| Total                       |       |       | $          | 500,000                                                |       |                                                                     |       | $                                        | 191,000    |                   |       |   |   |   |   |

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(1)          We incur interest usinga 30-day LIBOR rate, which was 5.35% at December 31, 2006.

(2)          We also incur an annualfacility fee of 15 basis points on this facility.

On September 19, 2006, we completed the September 2006Debt Offering. Net proceeds from the offering were used to repurchaseapproximately $50.0 million of our common stock at an average purchase price of$26.83 per share and for general corporate purposes, including the repayment ofoutstanding borrowings under the Amended Revolving Facility.

On August 25, 2006, we amended and restated ourexisting $350.0 million unsecured revolving credit facility and added anaccordion feature that allows us, subject to certain conditions, to increasethe amount that can be borrowed under the facility to $500.0 million. TheAmended Revolving Facility bears interest at LIBOR plus 55 basis points (basedon our current credit ratings) and incurs an annual facility fee of 15 basispoints. The Amended Revolving Facility is scheduled to mature on August 25,2010, with a one-year extension option.

On August 25, 2006, the Company also amended andrestated its existing $150.0 million secured term loan. The Amended SecuredTerm Loan bears interest at LIBOR plus 55 basis points (based on our currentcredit ratings) and is scheduled to mature on August 25, 2010.

Our ability toborrow under the Credit Agreements is subject to our ongoing compliance with anumber of covenants, including with respect to our ability to incur liens onour property, engage in major transactions such as mergers, make certaininvestments and engage in certain transactions with our affiliates. Inaddition, the Credit Agreements require that we maintain certain financialcoverage ratios and other debt covenants. As of December 31, 2006, thesecoverage ratios and debt covenants, as amended, included:

·       EBITDA(as defined in the applicable debt agreement) to fixed charges ratio of atleast 1.60:1;

·       minimumtangible net worth of approximately $1.2 billion;

·       totaldebt to total adjusted assets of no more than 60% (or 65% in certaincircumstances);

·       totalsecured debt to total adjusted assets of no more than 40%;

·       unsecureddebt to unencumbered assets value of no more than 60% (or 65% in certaincircumstances);

·       bookvalue of ancillary assets to total adjusted assets of no more than 25%;

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·       bookvalue of new construction assets to total adjusted assets of no more than 15%;and

·       Fundsfrom Operations (as defined in the applicable debt agreement) payout ratio nogreater than 95%.

Under the terms of each of the Amended RevolvingFacility and the Amended Secured Term Loan, the respective covenants will bemodified to be consistent with any more restrictive covenant contained in anyother existing or new senior unsecured credit facility that we enter into. TheAmended Secured Term Loan also contains certain financial covenants relating tothe operating performance of certain properties that collateralize the AmendedSecured Term Loan.

As of December 31, 2006, we had approximately$1.2 billion of public indebtedness outstanding, excluding the impact ofunamortized discounts, under three indentures, having a weighted averageinterest rate of 5.3%. These indentures also contain covenants that require usto maintain certain financial coverage ratios. These covenants are generallyless onerous than the covenants contained in our existing Credit Agreements, asdescribed above.

As of December 31, 2006, we were in compliancewith all of the financial covenants under our existing Credit Agreements andpublic indentures, and we believe that we will continue to remain in compliancewith these covenants. However, if our properties do not perform as expected, orif unexpected events occur that require us to borrow additional funds,compliance with these covenants may become difficult and may restrict ourability to pursue certain business initiatives. In addition, these financialcovenants may restrict our ability to pursue particular acquisitiontransactions (for example, acquiring a portfolio of properties that is highlyleveraged) and could significantly impact our ability to pursue growthinitiatives.

In addition to ourexisting Credit Agreements and public indebtedness, as of December 31,2006, we had approximately $437.3 million of mortgage debt outstanding,excluding the impact of unamortized premiums, having a weighted averagecontract interest rate of 7.3% per annum.

**Off-Balance SheetArrangements**

We do not believe that wecurrently have any off-balance sheet arrangements that have, or are reasonablylikely to have, a material current or future effect on our financial condition,changes in financial condition, revenues or expenses, results of operations,liquidity, capital expenditures or capital resources.

However, in a few cases, we have made commitments toprovide funds to unconsolidated joint ventures under certain circumstances. Theliabilities associated with these joint ventures do not show up as liabilitieson our consolidated financial statements.

The following is abrief summary of the unconsolidated joint venture obligations that we have asof December 31, 2006, and in which we expect to make additional capitalcontributions to the joint venture:

**·****     ***CA New Plan Acquisition Fund, LLC.*We have a 10% interest ina joint venture that was created in conjunction with the restructuring of CANew Plan Venture Fund, LLC (see below) for the acquisition, redevelopment anddevelopment of real estate assets. Under the terms of the joint venture, wehave committed to contribute our pro rata share of any capital that might berequired by the joint venture for asset acquisitions, up to a maximum of $4.2million, of which approximately $2.4 million had been contributed by us as of December 31,2006. We anticipate contributing the remaining approximately $1.8 million bythe end of 2007. Additionally, we have agreed to contribute our pro rata shareof any additional capital that might be required by the joint venture; however,we do not expect that any significant capital contributions will be required. Asof December 31, 2006, the joint venture owned seven stabilized retailproperties and one retail property under redevelopment. The joint venture hadloans outstanding of approximately $67.8 

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million as of December 31,2006. As of December 31, 2006, the book value of our investment in CA NewPlan Acquisition Fund, LLC was approximately $2.4 million.

**·****     ***Galileo America LLC.*We have a 5% interest in this jointventure, which interest was acquired on August 10, 2005 in conjunctionwith the Galileo Transactions. Under the terms of this joint venture, we arenot obligated to contribute any additional capital to the venture; however, in theevent that additional capital is contributed by our joint venture partner, wehave the option to contribute the amount necessary to maintain our 5% ownershipinterest. We anticipate making additional capital contributions from time totime to maintain our 5% ownership interest. As of December 31, 2006, thejoint venture was comprised of 132 stabilized retail assets, two retailproperties under redevelopment and one new development property and had loansoutstanding of approximately $1.3 billion. As of December 31, 2006, thebook value of our investment in Galileo America LLC was approximately $34.8million.

·       *NP / I&G Institutional Retail Company II, LLC*. In February 2006,we formed a second strategic joint venture with JP Morgan Investment ManagementInc. to acquire high-quality institutional grade community and neighborhoodshopping centers on a nationwide basis. Under the terms of this joint venture,we have a 20% interest in the venture and have committed to contribute our prorata share of any capital required by the venture for asset acquisitions. As ofDecember 31, 2006, we had contributed approximately $1.8 million. Additionally,we have agreed to contribute our pro rata share of any additional capital thatmight be required by the joint venture; however, we do not expect that anysignificant additional capital contributions with respect to existingproperties will be required. As of December 31, 2006, the joint ventureowned one stabilized retail property. The joint venture had loans outstandingof approximately $21.0 million as of December 31, 2006. As of December 31,2006, the book value of our investment in NP / I&G Institutional RetailCompany II, LLC was approximately $1.8 million.

**·****     ***NPK Redevelopment I, LLC.*We have a joint venture with KmartCorporation (Sears Holding Corp.) pursuant to which the joint venture willredevelop three Kmart Supercenter properties formerly owned by Kmart. Under theterms of this joint venture, we have agreed to contribute $6.0 million, $3.6million of which we have contributed as of December 31, 2006. After ourcontribution of the total committed amount, we will have a 20% interest in theventure and will be responsible for contributing our pro rata share of anyadditional capital that might be required by the joint venture; however, we donot expect that any significant capital contributions will be required. Thejoint venture had no loans outstanding as of December 31, 2006. As of December 31,2006, the book value of our investment in NPK Redevelopment I, LLC was approximately$3.6 million.

In addition, thefollowing is a brief summary of the other unconsolidated joint ventureobligations that we have as of December 31, 2006. Although we have agreedto contribute certain amounts of capital that may be required by these jointventures, as more fully described below, we do not expect that any significantcapital contributions to the following joint ventures will be required.

**·****     ***Arapahoe Crossings, L.P.*We, together with a U.S.partnership comprised substantially of foreign investors, have an interest in ajoint venture which owns Arapahoe Crossings, a community shopping centerlocated in Aurora, Colorado. Under the terms of this joint venture, we have a30% interest and we have agreed to contribute our pro rata share of any capitalthat might be required by the joint venture. The joint venture had loansoutstanding of approximately $47.8 million as of December 31, 2006. As of December 31,2006, the book value of our investment in Arapahoe Crossings, L.P. wasapproximately $6.5 million.

**·****     ***BPR Land Partnership, L.P.*We have a 50% interest in a jointventure that owns approximately 27.1 acres of undeveloped land in Frisco, Texas.Under the terms of this joint venture, we have agreed to contribute our prorata share of any capital that might be required by the joint venture.  The joint 

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venture had no loansoutstanding as of December 31, 2006. As of December 31, 2006, thebook value of our investment in BPR Land Partnership, L.P. was approximately$1.0 million.

**·****     ***BPR Shopping Center, L.P.*We have a 25% interest in a jointventure that owns The Centre at Preston Ridge, a community shopping centerlocated in Frisco, Texas. Under the terms of this joint venture, we have agreedto contribute our pro rata share of any capital that might be required by thejoint venture. The joint venture had loans outstanding of approximately $67.8million as of December 31, 2006. As of December 31, 2006, the bookvalue of our investment in BPR Shopping Center, L.P. was approximately $2.8million.

**·****     ***BPR South, L.P.*We have a 50% interest in a joint venturethat owns approximately 8.4 acres of undeveloped land in Frisco, Texas. Underthe terms of this joint venture, we have agreed to contribute our pro ratashare of any capital that might be required by the joint venture.  The joint venture had no loans outstanding asof December 31, 2006. As of December 31, 2006, the book value of ourinvestment in BPR South, L.P. was approximately $0.9 million.

**·****     ***CA New Plan Venture Direct Investment Fund, LLC.*We have a10% interest in a joint venture that was created in conjunction with therestructuring of CA New Plan Venture Fund, LLC (see below). Under the terms ofthe joint venture, we committed to contribute our pro rata share of any capitalthat might be required by the joint venture for certain redevelopmentactivities, up to a maximum of $0.4 million, and have agreed to contribute ourpro rata share of any additional capital that might be required by the jointventure. As of December 31, 2006, we had not made any such capitalcontributions. As of December 31, 2006, the joint venture owned fivestabilized retail properties and one retail property under redevelopment andhad loans outstanding of approximately $45.0 million. As of December 31,2006, the book value of our investment in CA New Plan Venture Direct InvestmentFund, LLC was approximately $0.7 million.

**·****     ***CA New Plan Venture Fund, LLC*. During 2005, this jointventure was restructured to create two additional joint ventures, CA New PlanAcquisition Fund, LLC, and CA New Plan Venture Direct Investment Fund, LLC. Asa result of the restructuring, six stabilized assets were transferred from CANew Plan Venture Fund, LLC to CA New Plan Venture Direct Investment Fund, LLC,and two assets were sold. As of December 31, 2006, the joint venture ownedfour stabilized retail properties and one retail property under redevelopment. Underthe terms of the restructured joint venture, we continue to have a 10% interestin the venture, and committed to contribute our pro rata share of any capitalthat might be required by the joint venture for certain redevelopmentactivities, up to a maximum amount of $0.9 million, and have agreed tocontribute our pro rata share of any additional capital that might be requiredby the joint venture. As of December 31, 2006, we had not made any suchcapital contributions. The joint venture had loans outstanding of approximately$47.3 million as of December 31, 2006. As of December 31, 2006, thebook value of our investment in CA New Plan Venture Fund, LLC was approximately$3.3 million.

**·****     ***NP/I&G Institutional Retail Company, LLC.*We have astrategic joint venture with JPMorgan Investment Management Inc. to acquirehigh-quality institutional grade community and neighborhood shopping centers ona nationwide basis. The joint venture owned 13 stabilized retail properties asof December 31, 2006. Under the terms of this joint venture, we have a 20%interest in the venture and are responsible for contributing our pro rata shareof any capital that might be required by the joint venture. We initiallycommitted to contribute up to a maximum amount of $30.0 million to the jointventure, however, in connection with the acquisition of certain assets during2005, we, together with ERP, contributed a disproportionate share of capital tothe venture, such that our total capital investment as of December 31,2005 was $41.4 million. The excess contribution was returned to us in February 2006.During the year ended December 31, 2006, in connection with the acquisitionof certain other assets, we increased our committed capital to the 

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venture to $31.9 million,of which approximately $29.2 million (which represents the book value of ourinvestment as of December 31, 2006) had been contributed as of December 31,2006. We do not expect that any significant additional capital contributionswill be required, nor do we expect that any additional acquisitions of propertywill be made by the joint venture. The joint venture had loans outstanding ofapproximately $281.4 million as of December 31, 2006.

**·****     ***NP/SSP Baybrook, LLC*. In December 2006, we formed athird strategic joint venture with JP Morgan Investment Management Inc. for thespecific purpose of acquiring Baybrook Gateway, a shopping center located inWebster, Texas. Under the terms of this joint venture, we have a 20% interestin the venture and are responsible for contributing our pro rata share of anycapital that might be required by the joint venture; however, we do not expectthat any significant additional capital contributions will be required. Thejoint venture had loans outstanding of approximately $41.0 million as of December 31,2006. As of December 31, 2006, the book value of our investment in NP/SSPBaybrook, LLC was approximately $2.9 million.

**·****     ***Westgate Mall, LLC*. We, together with TranswesternInvestment Company and The Richard E. Jacobs Group, have an interest in a jointventure that was formed for the specific purpose of acquiring and redevelopingWestgate Mall, an enclosed mall located on 55 acres of land in Fairview Park,Ohio. The joint venture is currently redeveloping the mall into a largecommunity shopping center. Under the terms of this joint venture, we have a 10%interest in the venture and have agreed to contribute our pro rata share of anycapital that might be required by the joint venture. The joint venture hadloans outstanding of approximately $27.7 million as of December 31, 2006.  As of December 31, 2006, the book valueof our investment in Westgate Mall, LLC was approximately $1.5 million.

*Other FundingObligations*

In addition to thejoint venture obligations described above, we also had the following contingentcontractual obligations as of December 31, 2006, none of which we believewill materially adversely affect us:

·       *Letters of Credit.*We have arranged for the provision ofseven separate letters of credit in connection with certain property orinsurance related matters. If these letters of credit are drawn, we will beobligated to reimburse the providing bank for the amount of the draw. As ofDecember 31, 2006, there was no balance outstanding under any of theletters of credit. If the letters of credit were fully drawn, the combinedmaximum amount of exposure would be approximately $12.7 million.

·       *Non-Recourse and Other Debt Guarantees*. Under certain of ournon-recourse loans and those of our joint ventures, we could, under certaincircumstances, be responsible for portions of the mortgage indebtedness inconnection with certain customary non-recourse carve out provisions such as environmentalconditions, misuse of funds and material misrepresentations. As ofDecember 31, 2006, we had mortgage loans outstanding of approximately$437.3 million, excluding the impact of unamortized premiums, and ourunconsolidated joint ventures had mortgage loans outstanding of approximately$1.9 billion. In addition, we have guaranteed certain construction and otherobligations relative to certain joint venture development projects; however wedo not expect that our obligations under such guarantees will be material ifcalled upon.

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·       *LeasingCommitments.*We have entered into leases, as lessee, in connectionwith ground leases for shopping centers which we operate and our administrativeoffice space. These leases are accounted for as operating leases. The minimumannual rental commitments for these leases during the next five fiscal yearsand thereafter are approximately as follows (dollars in thousands):

| **Year**   | ** ** | ** ** | ** ** | ** ** | ** ** |
|------------|------------|------------|------------|------------|------------|
| 2007       |       | $          | 3,474      |       |
| 2008       |       | 3,223      |       |
| 2009       |       | 3,217      |       |
| 2010       |       | 3,193      |       |
| 2011       |       | 3,092      |       |
| Thereafter |       | 41,608     |       |
|            |            |            |            |            |            |  |

 

We also have a potential contingent obligation inconnection with a specific tenant litigation for which we have reservedapproximately $4.8 million as of December 31, 2006. There can be noassurance as to the final outcome of this litigation and whether it will exceedor fall short of the amount reserved; however, we believe that the amount ofthe reserve is adequate.

For a discussion of otherfactors which may adversely affect our liquidity and capital resources, pleasesee the section titled “Risk Factors” in Item 1A of this Annual Report on Form 10-K.

**Inflation**

The majority of our leases contain provisions designedto mitigate the adverse impact of inflation. Such provisions contain clausesenabling us to receive percentage rents, which generally increase as pricesrise but may be adversely impacted by tenant sales decreases, and/or escalationclauses which are typically related to increases in the consumer price index orsimilar inflation indices. In addition, we believe that many of our existinglease rates are below current market levels for comparable space and that uponrenewal or re-rental such rates may be increased to be consistent with, or getcloser to, current market rates. This belief is based upon an analysis ofrelevant market conditions, including a comparison of comparable market rentalrates, and upon the fact that many of our leases have been in place for anumber of years and may not contain escalation clauses sufficient to match theincrease in market rental rates over such time. Most of our leases require thetenant to pay its share of operating expenses, including common areamaintenance, real estate taxes and insurance, thereby reducing our exposure toincreases in costs and operating expenses resulting from inflation. Inaddition, we periodically evaluate our exposure to interest rate fluctuations,and may enter into interest rate protection agreements which mitigate, but donot eliminate, the effect of changes in interest rates on our floating rateloans.

In the normal course ofbusiness, we also face risks that are either non-financial or non-qualitative. Suchrisks principally include credit risks and legal risks.

***Item 7A.****   Quantitative and Qualitative Disclosures aboutMarket Risk*

As of December 31, 2006, we had approximately$9.3 million of outstanding floating rate mortgages. We also had approximately$191.0 million outstanding under our floating rate Credit Agreements. Inaddition, as discussed below, we have converted $65.0 million of fixed rateborrowings to floating rate borrowings through the use of a hedging agreement. Wedo not believe that the interest rate risk represented by our floating ratedebt is material as of December 31, 2006, in relation to our approximately$1.8 billion of outstanding total debt, our approximately $3.5 billion of totalassets and our approximately $5.0 billion total market capitalization as ofthat date.

54

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On August 2,2006, we entered into two forward starting interest rate swap agreements, eachfor $75.0 million in notional amount. One of the swaps is expected to be usedto hedge the risk of changes in interest cash outflows on fixed rate 10-yearborrowings/financings that we anticipate issuing between February 1, 2007and October 31, 2007 by effectively locking the three-month LIBOR swaprate. This swap terminates on June 15, 2017. The other swap is expected tobe used to hedge the risk of changes in interest cash outflows on fixed rate 10-yearborrowings/financings that we anticipate issuing between February 1, 2008and October 31, 2008 by effectively locking the three-month LIBOR swaprate. This swap terminates on June 4, 2018.

As of December 31, 2006, we had entered into tworeverse arrears swap agreements.  The tworeverse arrears swap agreements effectively convert the interest rate on $65.0million of the debt from a fixed rate to a blended floating rate of 30 basispoints over the six-month LIBOR rate. These two swaps will terminate on February 1,2011.

Hedging agreements may expose us to the risk that thecounterparties to these agreements may not perform, which could increase ourexposure to fluctuating interest rates. Generally, the counterparties tohedging agreements that we enter into are major financial institutions. We mayborrow additional money with floating interest rates in the future. Increasesin interest rates, or the loss of the benefit of existing or future hedgingagreements, would increase our expense, which would adversely affect cash flowand our ability to service our debt. Future increases in interest rates willincrease our interest expense as compared to the fixed rate debt underlying ourhedging agreements and we could be required to make payments to unwind suchagreements.

If market rates ofinterest on our variable rate debt increase by 1%, the increase in annualinterest expense on our variable rate debt would decrease future earnings andcash flows by approximately $2.7 million. If market rates of interest on ourvariable rate debt decrease by 1%, the decrease in interest expense on ourvariable rate debt would increase future earnings and cash flows by approximately$2.7 million. This assumes that the amount outstanding under our variable ratedebt remains at approximately $265.3 million (including the impact of $65.0million in reverse arrears swap agreements), the balance as of December 31,2006. If market rates of interest increase by 1%, the fair value of our totaloutstanding debt would decrease by approximately $71.7 million. If market ratesof interest decrease by 1%, the fair value of our total outstanding debt wouldincrease by approximately $75.0 million. This assumes that our totaloutstanding debt remains at $1.8 billion, the balance as of December 31,2006.

***Item 8.****                        FinancialStatements and Supplementary Data*

Financial statementsrequired by this item appear with an Index to Financial Statements andSchedules, starting on page F-1 of this Annual Report on Form 10-K.

***Item 9.****                        Changesin and Disagreements with Accountants on Accounting and Financial Disclosure*

None.

**Item9A****.***                **Controls andProcedures***

**Evaluation ofDisclosure Controls and Procedures**

An evaluation wasperformed under the supervision and with the participation of our management,including our Chief Executive Officer and Chief Financial Officer, of theeffectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) underthe Securities and Exchange Act of 1934, as amended) as of the end of theperiod covered by this report. Based on that evaluation, the Chief ExecutiveOfficer and Chief Financial Officer concluded that these disclosure controlsand procedures were effective as of the end of the period covered by thisAnnual Report on Form 10-K.

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**Management’s Reporton Internal Control Over Financial Reporting**

Management’s report oninternal control over financial reporting and the attestation report ofPricewaterhouseCoopers LLP, our independent registered public accounting firm,on management’s assessment of our internal control over financial reporting areset forth on pages F-2 and F-3, respectively, of this AnnualReport on Form 10-K, and are incorporated herein by reference.

**Changes in InternalControl Over Financial Reporting**

There has been no changein our internal control over financial reporting during our most recent fiscalquarter that has materially affected, or is reasonably likely to materiallyaffect, our internal control over financial reporting.

**Item9B.***               **OtherInformation***

Not applicable.

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**PART III**

***Item 10.****                 Directors,Executive Officers, and Corporate Governance*

We have adopted a Code of Ethics for PrincipalExecutive Officer and Senior Financial Officers, which is available on ourwebsite at www.newplan.com. We intend to disclose any amendment to, or waiverfrom, a provision of our Code of Ethics for Principal Executive Officer andSenior Financial Officers on our website within four business days followingthe date of amendment or waiver.

The information requiredby this item regarding directors, executive officers and corporate governanceis hereby incorporated by reference to the material appearing in the ProxyStatement for the Annual Stockholders Meeting to be held in 2007 (the “ProxyStatement”) under the captions “Election of Directors,” and “InformationRegarding Directors, Executive Officers and Corporate Governance.”  The information required by this itemregarding compliance with Section 16(a) of the Securities ExchangeAct of 1934, as amended, is hereby incorporated by reference to the materialappearing in the Proxy Statement under the caption “Other Matters—Section 16(a) BeneficialOwnership Reporting Compliance.”

***Item 11.****                 ExecutiveCompensation*

The information requiredby this item is hereby incorporated by reference to the material appearing inthe Proxy Statement under the captions “Compensation Discussion and Analysis,” “Compensationof Directors and Executive Officers,” “Compensation Committee Report” and “CompensationCommittee Interlocks and Insider Participation.”

***Item 12.****                 SecurityOwnership of Certain Beneficial Owners and Management and Related StockholderMatters*

The information regarding security ownership ofcertain beneficial owners and management required by this item is herebyincorporated by reference to the material appearing in the Proxy Statementunder the caption “Voting Securities of Certain Beneficial Owners andManagement.”

Thefollowing table sets forth certain information regarding our equitycompensation plans as of December 31, 2006. In order to counteract thedilutive effect on the options outstanding resulting from the payment of theSpecial Dividend, we amended our outstanding option grants to adjust both thenumber of options outstanding and the related exercise prices. The informationset forth in the following table includes the effect of such amendment.

| **Plan Category**                                     | ** ** | ** ** | ** ** | **Number of securities  to be issued upon   exercise of   outstanding options,  warrants and rights** | ** ** | **Weighted-average   exercise price of   outstanding options,  warrants and rights** | ** ** | **Number of securities   remaining available for  future issuance under equity  compensation plans  (excluding securities  reflected in column (a))** | ** ** |
|------------------------------------------------------------|------------|------------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|-------------------------------------------------------------------------------------------------------------------------|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|
| ** **                                                 | ** ** | **(a)**    | ** ** | **(b)**                                                                                                                                                      | ** ** | **(c)**                                                                                                                 | ** ** |
| Equity  compensation plans approved by stockholders        |       |       | 3,802,928  |                                                                                                                                                         |       |                                                                                                                    | $          | 20.48                                                                                                                                                                                                                  |       |   |   | 2,002,207 | (1) |   |
| Equity compensation plans not approved by stockholders (2) |       |       | 633,650    |                                                                                                                                                         |       |                                                                                                                    | 11.35      |                                                                                                                                                                                                                   |       |   | —- |   |   |
| Total                                                      |       |       | 4,436,578  |                                                                                                                                                         |       |                                                                                                                    | $          | 19.18                                                                                                                                                                                                                  |       |   |   | 2,002,207 | (1) |   |

----

(1)          All of these securitiesare available for issuance under our 2003 Stock Incentive Plan.

(2)          Representsoptions granted to Glenn Rufrano, our Chief Executive Officer, in connectionwith the employment agreement entered into upon commencement of Mr. Rufrano’semployment with us in February 2000. All of these options, which have anexercise price of $11.35 per share and expire ten years from the grant date,were vested as of February 23, 2005.

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***Item 13.****                **Certain Relationships and Related Transactions, and DirectorIndependence*

The information requiredby this item is hereby incorporated by reference to the material appearing in theProxy Statement under the captions “Transactions with Related Persons” and “InformationRegarding Directors, Executive Officers and Corporate Governance—Independenceof Directors.”

**Item14.***                 **PrincipalAccountant Fees and Services***

The information required by this item is herebyincorporated by reference to the material appearing in the Proxy Statementunder the caption “Other Matters—Relationship with Independent Accountants.”

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**PART IV**

## **Item 15.   *Exhibits and Financial Statement Schedules***

|        |   | (a)    |     | Documents filed as part of this report:                                               |
|--------|--------|--------|----------|---------------------------------------------------------------------------------------|
|   |   |   | * * | 1.                                                                                    |   | *Financial Statements.* |
|   |   |   | * * |                                                                                  |   | The response to this  portion of Item 15 is submitted as a separate section of this report. |
|   |   |   | * * | 2.                                                                                    | * * | *Financial Statement Schedules.* |
|   |   |   | * * |                                                                                  |   | The response to this  portion of Item 15 is submitted as a separate section of this report. |
|   |   |   | * * | 3.                                                                                    | * * | *Exhibits.* |
|   |   |   | * * |                                                                                  |   | The list of exhibits  filed with this report is set forth in response to Item 15(b). The required  exhibit index has been filed with the exhibits. |
|   |   | (b)    | * * | *Exhibits.  *The  following documents are filed as exhibits to this report: |

 

| *3.1 |   | Articles of Amendment and Restatement of the Charter  of the Company, filed as Exhibit 3.01 to Amendment No. 1 to the  Company’s Registration Statement on Form S-3, File No. 33-59195.                                                                                                                                                                                                                                           |
|------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *3.2 |   | Articles of Amendment of  Articles of Amendment and Restatement of the Charter of the Company, filed as  Exhibit 4.4 to the Company’s Registration Statement on Form S-3,  File No. 333-65211.                                                                                                                                                                                                                                         |
| *3.3 |   | Restated Bylaws of the  Company, effective as of February 23, 2004 (incorporating all amendments  thereto through February 23, 2004), filed as Exhibit 3.3 to the  Company’s Annual Report on Form 10-K for the year ended  December 31, 2004.                                                                                                                                                                               |
| *4.1 |   | Articles Supplementary  classifying 150,000 shares of preferred stock as 7.80% Series D  Cumulative Voting Step-Up Premium Rate Preferred Stock, filed as  Exhibit 4.5 to the Company’s Registration Statement on Form S-3,  File No. 333-65211.                                                                                                                                                                                  |
| *4.2 |   | Articles Supplementary  classifying 805,000 shares of preferred stock as 7.625% Series E  Cumulative Redeemable Preferred Stock, filed as Exhibit 4.1 to the  Company’s Current Report on Form 8-K filed on April 17, 2003.                                                                                                                                                                                                       |
| *4.3 |   | Senior Securities  Indenture, dated as of March 29, 1995, between New Plan Realty Trust and  The First National Bank of Boston, as Trustee, filed as Exhibit 4.2 to  New Plan Realty Trust’s Registration Statement on Form S-3, File  No. 33-61383.                                                                                                                                                                              |
| *4.4 |   | First Supplemental Indenture,  dated as of August 5, 1999, by and among New Plan Realty Trust, New Plan  Excel Realty Trust, Inc. and State Street Bank and Trust Company, filed  as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended September 30, 1999.                                                                                                                                  |
| *4.5 |   | Senior Securities  Indenture, dated as of February 3, 1999, among the Company, New Plan  Realty Trust, as guarantor, and State Street Bank and Trust Company, as  Trustee, filed as Exhibit 4.1 to the Company’s Current Report on  Form 8-K dated February 3, 1999.                                                                                                                                                              |
| *4.6 |   | Supplemental Indenture,  dated as of December 17, 2004, by and between the Company and U.S. Bank  Trust National Association (as successor to State Street Bank and Trust  Company), as Trustee, to the Indenture dated as of February 3, 1999, by  and among the Company, New Plan Realty Trust, as guarantor, and the Trustee,  filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K  dated December 22, 2004. |

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| *4.7   |   | Senior Securities  Indenture, dated as of January 30, 2004, by and between the Company and  U.S. Bank Trust National Association, as Trustee filed as Exhibit 4.1 to  the Company’s Current Report on Form 8-K dated February 5,  2004.                                                                                                                                                                                              |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *4.8   |   | First Supplemental  Indenture, dated as of September 19, 2006, between the Company and U.S.  Bank Trust National Association, as trustee, filed as Exhibit 4.1 to the  Company’s Current Report on Form 8-K, filed on September 19,  2006.                                                                                                                                                                                           |
| *4.9   |   | Registration Rights  Agreement, dated as of September 19, 2006, among the Company and the  Initial Purchasers named in Schedule A to the Purchase Agreement, for whom  Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith  Incorporated and Banc of America Securities LLC are acting as  representatives, filed as Exhibit 4.3 to the Company’s Current Report on  Form 8-K, filed on September 19, 2006. |
| *10.1  |   | New Plan Realty Trust  1991 Stock Option Plan, as amended, filed as Exhibit 4.2 to the  Company’s Registration Statement on Form S-8, File No. 333-65221.  †                                                                                                                                                                                                                                                                         |
| *10.2  |   | Amended and Restated  1993 Stock Option Plan of the Company, dated May 28, 1998, filed as  Exhibit 4.1 to the Company’s Registration Statement on Form S-8,  File No. 333-65223. †                                                                                                                                                                                                                                              |
| *10.3  |   | Amendment to the Amended  and Restated 1993 Stock Option Plan of the Company, dated September 28,  1998, filed as Exhibit 10.4 to the Company’s Annual Report on  Form 10-K/A for the year ended December 31, 1998. †                                                                                                                                                                                                           |
| *10.4  |   | Amendment to the Amended  and Restated 1993 Stock Option Plan of the Company, dated February 8,  1999, filed as Exhibit 10.5 to the Company’s Annual Report on  Form 10-K/A for the year ended December 31, 1998. †                                                                                                                                                                                                             |
| *10.5  |   | Amendment to the Amended  and Restated 1993 Stock Option Plan of the Company, dated April 21,  1999, filed as Exhibit 10.4 to the Company’s Annual Report on  Form 10-K for the year ended December 31, 1999. †                                                                                                                                                                                                                 |
| *10.6  |   | Amendment to the Amended  and Restated 1993 Stock Option Plan of the Company, dated February 17,  2000, filed as Exhibit 10.5 to the Company’s Annual Report on  Form 10-K for the year ended December 31, 1999. †                                                                                                                                                                                                              |
| *10.7  |   | Amended and Restated  1994 Directors’ Stock Option Plan of the Company, dated May 10, 1996,  filed as Exhibit 10.8 to the Company’s Annual Report on Form 10-K/A  for the year ended December 31, 1998. †                                                                                                                                                                                                                  |
| *10.8  |   | Amendment to the Amended  and Restated 1994 Directors’ Stock Option Plan of the Company, dated  September 28, 1998, filed as Exhibit 10.9 to the Company’s Annual  Report on Form 10-K/A for the year ended December 31, 1998. †                                                                                                                                                                                           |
| *10.9  |   | Amendment to the Amended  and Restated 1994 Directors’ Stock Option Plan of the Company, dated  February 17, 2000, filed as Exhibit 10.8 to the Company’s Annual  Report on Form 10-K for the year ended December 31, 1999. †                                                                                                                                                                                              |
| *10.10 |   | Amendment to the Amended  and Restated 1994 Directors’ Stock Option Plan of the Company, effective as  of May 24, 2000, filed as Exhibit 10.6 to the Company’s Quarterly  Report on Form 10-Q for the quarter ended June 30, 2000. †                                                                                                                                                                                       |
| *10.11 |   | New Plan Realty Trust  1997 Stock Option Plan, filed as Exhibit 4.1 to the Company’s  Registration Statement on Form S-8, File No. 333-65221.  †                                                                                                                                                                                                                                                                                     |
| *10.12 |   | 2003 Stock Incentive  Plan of the Company, as amended and restated effective July 14, 2005,  filed as Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended September 30, 2005. †                                                                                                                                                                                                                  |

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| *10.13 |   | Form of Stock  Option Award pursuant to 2003 Stock Incentive Plan, filed as  Exhibit 10.1 to the Company’s Current Report on Form 8-K,  dated February 18, 2005. †                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *10.14 |   | Form of Amendment  to Stock Option Awards pursuant to 2003 Stock Incentive Plan, filed as  Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended September 30, 2005. †                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| *10.15 |   | Form of Restricted  Stock Award pursuant to 2003 Stock Incentive Plan, filed as Exhibit 10.2  to the Company’s Current Report on Form 8-K, dated  February 18, 2005. †                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| *10.16 |   | Out-Performance Compensation  Plan, effective as of February 27, 2006, filed as Exhibit 10.1 to  the Company’s Quarterly Report on Form 10-Q for the quarter ended  March 31, 2006. †                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *10.17 |   | Second Amended and  Restated Revolving Credit Agreement, dated as of August 25, 2006, among  New Plan Excel Realty Trust, Inc., Bank of America, N.A. and the other  lenders party thereto, filed as Exhibit 10.1 to the Company’s Current  Report on Form 8-K, filed on August 28, 2006.                                                                                                                                                                                                                                                                                                                                                                                                               |
| *10.18 |   | Second Amended and  Restated Guaranty, dated as of August 25, 2006, by and among Excel  Realty Trust—ST, Inc., CA New Plan Asset Partnership IV, L.P., CA New  Plan Texas Assets, L.P., HK New Plan Exchange Property Owner II, LP, NP of  Tennessee, L.P., HK New Plan Exchange Property Owner I, LLC, New Plan of  Illinois, LLC, New Plan of Michigan, LLC, New Plan Property Holding Company,  Pointe Orlando Development Company, New Plan Realty Trust, Excel Realty  Trust-NC and Bank of America, N.A., as administrative agent (Second Amended  and Restated Revolving Credit Agreement), filed as Exhibit 10.2 to the  Company’s Current Report on Form 8-K, filed on August 28,  2006.  |
| *10.19 |   | Second Amended and  Restated Secured Term Loan Agreement, dated as of August 25, 2006, among  New Plan Excel Realty Trust, Inc., Bank of America, N.A. and the other  lenders party thereto, filed as Exhibit 10.3 to the Company’s Current  Report on Form 8-K, filed on August 28, 2006.                                                                                                                                                                                                                                                                                                                                                                                                              |
| *10.20 |   | Second Amended and  Restated Guaranty, dated as of August 25, 2006, by and among Excel  Realty Trust—ST, Inc., CA New Plan Asset Partnership IV, L.P., CA New  Plan Texas Assets, L.P., HK New Plan Exchange Property Owner II, LP, NP of  Tennessee, L.P., HK New Plan Exchange Property Owner I, LLC, New Plan of  Illinois, LLC, New Plan of Michigan, LLC, New Plan Property Holding Company,  Pointe Orlando Development Company, New Plan Realty Trust, Excel Realty  Trust-NC and Bank of America, N.A., as administrative agent (Second Amended  and Restated Secured Term Loan Agreement), filed as Exhibit 10.4 to the  Company’s Current Report on Form 8-K, filed on August 28,  2006. |
| *10.21 |   | Term Loan Agreement,  dated as of April 5, 2005, by and among the Company, Citicorp North  America, Inc., as administrative agent, and the other lenders party  thereto, filed as Exhibit 10.2 to the Company’s Quarterly Report on  Form 10-Q for the quarter ended June 30, 2005.                                                                                                                                                                                                                                                                                                                                                                                                                     |
| *10.22 |   | First Amendment to Term  Loan Agreement, dated as of July 13, 2005, by and among the Company,  Citicorp North America, Inc., as administrative agent, and the other  lenders party thereto, filed as Exhibit 10.3 to the Company’s Quarterly  Report on Form 10-Q for the quarter ended September 30, 2005.                                                                                                                                                                                                                                                                                                                                                                                             |

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| *10.23 |   | Second Amendment to Term  Loan Agreement, dated as of July 19, 2005, by and among the Company,  Citicorp North America Inc., as administrative agent, and the other lenders  party thereto, filed as Exhibit 10.4 to the Company’s Quarterly Report  on Form 10-Q for the quarter ended September 30, 2005. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *10.24 |   | Second Amended and  Restated Agreement of Limited Partnership of Excel Realty Partners, L.P., dated  as of May 19, 2003, filed as Exhibit 10.2 to the Company’s  Quarterly Report on Form 10-Q for the quarter ended June 30,  2003.                                                                        |
| *10.25 |   | First Amendment to  Second Amended and Restated Agreement of Limited Partnership of Excel Realty  Partners, L.P., dated as of December 7, 2004, filed as  Exhibit 10.20 to the Company’s Annual Report on Form 10-K for  the year ended December 31, 2004.                                                  |
| *10.26 |   | Dividend Reinvestment  and Share Purchase Plan, included in the prospectus of the Company filed  pursuant to Rule 424(b)(3), File No. 333-65211, on  April 20, 2000.                                                                                                                                                  |
| 10.27  |   | New Plan Excel Realty  Trust, Inc. Deferred Compensation Plan, amended and restated as of  February 26, 2007. †                                                                                                                                                                                                  |
| *10.28 |   | Director Compensation  Schedule, filed as Exhibit 10.1 to the Company’s Current Report on  Form 8-K, dated February 28, 2005. †                                                                                                                                                                        |
| *10.29 |   | 2005 Compensation  Schedule for Executive Officers, filed as Exhibit 10.1 to the Company’s  Current Report on Form 8-K, filed on March 3, 2006. †                                                                                                                                                           |
| *10.30 |   | Support Agreement, dated  as of May 14, 1998, by William Newman to the Company, filed as  Exhibit 10.7 to the Company’s Registration Statement on Form S-4,  File No. 333-61131, dated August 11, 1998. †                                                                                    |
| *10.31 |   | Schedule of William  Newman’s Compensation Arrangement, filed as Exhibit 10.2 to the  Company’s Current Report on Form 8-K, dated October 28, 2005.  †                                                                                                                                                 |
| *10.32 |   | Demand Promissory Note,  dated July 1, 1997, made by Dean Bernstein in favor of the Company,  filed as Exhibit 10.23 to the Company’s Annual Report on Form 10-K  for the year ended December 31, 2002.                                                                                                     |
| *10.33 |   | Employment Agreement,  dated as of September 25, 1998, by and between the Company and Dean  Bernstein, filed as Exhibit 10.39 to the Company’s Annual Report on  Form 10-K for the year ended December 31, 2000. †                                                                                |
| *10.34 |   | Extension Letter  concerning Employment Agreement, dated March 27, 2000, provided by the  Company to Dean Bernstein, filed as Exhibit 10.42 to the Company’s  Annual Report on Form 10-K for the year ended December 31,  2001. †                                                                 |
| *10.35 |   | Agreement, dated  May 14, 2004, by and between the Company and Dean Bernstein, filed as  Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended June 30, 2004. †                                                                                                           |
| *10.36 |   | Agreement, dated as of  May 16, 2006, by and between the Company and Dean Bernstein, filed as  Exhibit 10.2 to the Company’s Current Report on Form 8-K,  filed on May 17, 2006. †                                                                                                                     |
| *10.37 |   | Demand Promissory Note,  dated June 29, 1994, made by Steven F. Siegel in favor of the Company,  filed as Exhibit 10.26 to the Company’s Annual Report on Form 10-K  for the year ended December 31, 2002.                                                                                                  |
| *10.38 |   | Demand Promissory Note,  dated July 1, 1997, made by Steven F. Siegel in favor of the Company,  filed as Exhibit 10.27 to the Company’s Annual Report on Form 10-K  for the year ended December 31, 2002.                                                                                                   |

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| *10.39 |   | Employment Agreement,  dated as of September 25, 1998, by and between the Company and Steven F.  Siegel, filed as Exhibit 10.45 to the Company’s Annual Report on  Form 10-K/A for the year ended December 31, 1998. †              |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *10.40 |   | Extension Letter  concerning Employment Agreement, dated March 27, 2000, provided by the  Company to Steven F. Siegel, filed as Exhibit 10.44 to the Company’s  Annual Report on Form 10-K for the year ended December 31,  2001. † |
| *10.41 |   | Agreement, dated  June 24, 2003, by and between the Company and Steven F. Siegel, filed as  Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended June 30, 2003. †                                          |
| *10.42 |   | Agreement, dated as of  May 16, 2006, by and between the Company and Steven F. Siegel, filed as  Exhibit 10.1 to the Company’s Current Report on Form 8-K,  filed on May 17, 2006. †                                                     |
| *10.43 |   | Employment Agreement,  dated as of March 15, 2005, by and between the Company and Glenn  Rufrano, filed as Exhibit 10.1 to the Company’s Current Report on  Form 8-K, dated March 18, 2005. †                                       |
| *10.44 |   | Stock Option Agreement,  dated as of February 23, 2000, by and between the Company and Glenn J.  Rufrano (relating to 460,976 options), filed as Exhibit 10.2 to the  Company’s Current Report on Form 8-K, dated March 9, 2000. †       |
| *10.45 |   | Stock Option Agreement,  dated as of February 23, 2000, by and between the Company and Glenn J.  Rufrano (relating to 200,000 options), filed as Exhibit 10.4 to the  Company’s Current Report on Form 8-K, dated March 9, 2000. †       |
| *10.46 |   | Employment Agreement,  dated as of April 14, 2000, by and between the Company and John Roche,  filed as Exhibit 10.15 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended March 31, 2000. †                            |
| *10.47 |   | Agreement, dated as of  September 27, 2002, by and between the Company and John Roche, filed as  Exhibit 10.38 to the Company’s Annual Report on Form 10-K for  the year ended December 31, 2002. †                                      |
| *10.48 |   | Agreement, dated as of  October 24, 2005, by and between the Company and John Roche, filed as  Exhibit 10.1 to the Company’s Current Report on Form 8-K,  dated October 28, 2005. †                                                      |
| *10.49 |   | Employment Agreement,  dated as of September 14, 2000, by and between the Company and Leonard  Brumberg, filed as Exhibit 10.1 to the Company’s Quarterly Report on  Form 10-Q for the quarter ended September 30, 2000. †               |
| *10.50 |   | Agreement, dated  February 12, 2003, by and between the Company and Leonard Brumberg,  filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended March 31, 2003. †                                     |
| *10.51 |   | Agreement, dated as of  March 15, 2005, by and between the Company and Leonard Brumberg, filed  as Exhibit 10.3 to the Company’s Current Report on Form 8-K,  dated March 18, 2005.†                                                     |
| *10.52 |   | Consulting Agreement,  dated as of May 6, 2005 (effective as of May 1, 2005), by and  between the Company and Scott MacDonald, filed as Exhibit 10.1 to the  Company’s Current Report on Form 8-K, dated May 10, 2005. †            |
| *10.53 |   | Employment Agreement,  dated as of March 15, 2005, by and between the Company and Michael  Carroll, filed as Exhibit 10.2 to the Company’s Current Report on  Form 8-K, dated March 18, 2005. †                                          |

63

----

 

| *10.54 |   | Contribution and Sale  Agreement, dated as of July 19, 2005, by and among the Company, certain  of its subsidiaries, Galileo America LLC and Galileo America, Inc.,  filed as Exhibit 99.3 to the Company’s Current Report on Form 8-K,  dated August 16, 2005. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 12.1   |   | Ratio of Earnings to  Fixed Charges.                                                                                                                                                                                                                                                          |
| 12.2   |   | Ratio of Earnings to  Fixed Charges and Preferred Stock Dividends.                                                                                                                                                                                                                            |
| 21     |   | Subsidiaries of the  Company.                                                                                                                                                                                                                                                                 |
| 23     |   | Consent of  PricewaterhouseCoopers LLP.                                                                                                                                                                                                                                                       |
| 31.1   |   | Certification of Chief  Executive Officer required by Rule 13a-14(a)/15d-14(a) under  the Exchange Act, as adopted pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002.                                                                                                 |
| 31.2   |   | Certification of Chief  Financial Officer required by Rule 13a-14(a)/15d-14(a) under  the Exchange Act, as adopted pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002.                                                                                                 |
| 32.1   |   | Certification of Chief  Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of the  Sarbanes-Oxley Act of 2002.                                                                                                   |

----

*                    Incorporatedherein by reference as above indicated.

†                    Denotes amanagement contract or compensatory plan, contract or arrangement. 

64

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**NEWPLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESINDEX TO CONSOLIDATED FINANCIAL STATEMENTS**

|        | ** ** | ** **                                                                                                                                                      | ** ** | **Page** |
|--------|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|----------|
| 1.     |       | CONSOLIDATED STATEMENTS                                                                                                                                         |       |     |
|   |       | Management’s Report on Internal Control Over Financial  Reporting                                                                                          |       | F-2      |
|   |       | Report of Independent Registered Public Accounting  Firm                                                                                                        |       | F-3      |
|   |       | Consolidated  Balance Sheets December 31, 2006 and December 31, 2005                                                                                  |       | F-5      |
|   |       | Consolidated Statements of Income and Comprehensive  Income for the Years ended December 31, 2006, December 31, 2005 and  December 31, 2004      |       | F-6      |
|   |       | Consolidated Statements of Changes in Stockholders’  Equity for the Years ended December 31, 2006, December 31, 2005 and  December 31, 2004 |       | F-7      |
|   |       | Consolidated Statements of Cash Flows for the Years  ended December 31, 2006, December 31, 2005 and December 31,  2004                           |       | F-8      |
|   |       | Notes  to Consolidated Financial Statements                                                                                                                     |       | F-9      |
| 2.     |       | CONSOLIDATED FINANCIAL  STATEMENT SCHEDULES                                                                                                                     |       |     |
|   |       | Schedule II—Valuation and Qualifying Accounts                                                                                                              |       | F-49     |
|   |       | Schedule III—Real Estate and Accumulated Depreciation                                                                                                      |       | F-50     |
|   |       | Schedule  IV—Mortgage Loans on Real Estate                                                                                                                 |       | F-65     |

 

All other schedules are omitted because they are notapplicable or the required information is shown in the financial statements ornotes thereto.

F-1

----

**Management’s Reporton Internal Control Over Financial Reporting**

Our management is responsible for establishing andmaintaining adequate internal control over financial reporting (as such term isdefined in Rule 13a-15(f) under the Securities Exchange Act of1934, as amended). An evaluation was performed under the supervision and withthe participation of our management, including our Chief Executive Officer andChief Financial Officer, of the effectiveness of our internal control overfinancial reporting based on the framework in *InternalControl—Integrated Framework*issued by the Committee of SponsoringOrganizations of the Treadway Commission. Based on our evaluation under theframework in *Internal Control—IntegratedFramework,*our management concluded that our internal control overfinancial reporting was effective as of December 31, 2006.

Our management’s assessment of the effectiveness ofour internal control over financial reporting as of December 31, 2006 hasbeen audited by PricewaterhouseCoopers LLP, an independent registered publicaccounting firm, as stated in their report which is included herein.

F-2

----

**Report ofIndependent Registered Public Accounting Firm**

To the Board of Directors and Stockholdersof New Plan Excel Realty Trust, Inc.:

We have completed integrated audits of New Plan ExcelRealty Trust, Inc.’s consolidated financial statements and of its internalcontrol over financial reporting as of December 31, 2006, in accordancewith the standards of the Public Company Accounting Oversight Board (UnitedStates). Our opinions, based on ouraudits, are presented below.

Consolidated financialstatements and financial statement schedules

In our opinion, theconsolidated financial statements  listedin the index appearing under Item 15(a)(1) present fairly, in allmaterial respects, the financial position of New Plan Excel Realty Trust, Inc.and its subsidiaries (collectively, the “Company”) at December 31, 2006and 2005 and the results of their operations and their cash flows for each ofthe three years in the period ended December 31, 2006 in conformity withaccounting principles generally accepted in the United States of America. In addition, in our opinion, the financialstatement schedules listed in the index appearing under Item 15(a)(2) presentfairly, in all material respects, the information set forth therein when readin conjunction with the related consolidated financial statements. Thesefinancial statements and financial statement schedules are the responsibilityof the Company’s management. Our responsibility is to express an opinion onthese financial statements and financial statement schedules based on ouraudits. We conducted our audits of these statements in accordance with thestandards of the Public Company Accounting Oversight Board (United States). Thosestandards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of materialmisstatement. An audit of financial statements includes examining, on a testbasis, evidence supporting the amounts and disclosures in the financialstatements, assessing the accounting principles used and significant estimatesmade by management, and evaluating the overall financial statement presentation.We believe that our audits provide a reasonable basis for our opinion.

Internal control over financial reporting

Also, in our opinion, management’s assessment,included in Management’s Report onInternal Control Over Financial Reporting appearing on page F-2,that the Company maintained effective internal control over financial reportingas of December 31, 2006 based on criteria established in *Internal Control—Integrated Framework* issued by theCommittee of Sponsoring Organizations of the Treadway Commission (COSO), isfairly stated, in all material respects, based on those criteria. Furthermore,in our opinion, the Company maintained, in all material respects, effectiveinternal control over financial reporting as of December 31, 2006, basedon criteria established in *Internal Control—IntegratedFramework* issued by the COSO. The Company’s management isresponsible for maintaining effective internal control over financial reportingand for its assessment of the effectiveness of internal control over financialreporting. Our responsibility is to express opinions on management’s assessmentand on the effectiveness of the Company’s internal control over financialreporting based on our audit. We conducted our audit of internal control overfinancial reporting in accordance with the standards of the Public CompanyAccounting Oversight Board (United States). Those standards require that we planand perform the audit to obtain reasonable assurance about whether effectiveinternal control over financial reporting was maintained in all materialrespects. An audit of internal control over financial reporting includesobtaining an understanding of internal control over financial reporting,evaluating management’s assessment, testing and evaluating the design andoperating effectiveness of internal control, and performing such otherprocedures as we consider necessary in the circumstances. We believe that ouraudit provides a reasonable basis for our opinions.

F-3

----

A company’s internal control over financial reportingis a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for externalpurposes in accordance with generally accepted accounting principles. A company’sinternal control over financial reporting includes those policies andprocedures that (i) pertain to the maintenance of records that, inreasonable detail, accurately and fairly reflect the transactions anddispositions of the assets of the company; (ii) provide reasonableassurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accountingprinciples, and that receipts and expenditures of the company are being madeonly in accordance with authorizations of management and directors of thecompany; and (iii) provide reasonable assurance regarding prevention ortimely detection of unauthorized acquisition, use, or disposition of thecompany’s assets that could have a material effect on the financial statements.

Because of its inherentlimitations, internal control over financial reporting may not prevent ordetect misstatements. Also, projections of any evaluation of effectiveness tofuture periods are subject to the risk that controls may become inadequatebecause of changes in conditions, or that the degree of compliance with thepolicies or procedures may deteriorate.

/s/ PricewaterhouseCoopers LLPNew York, New YorkFebruary 26, 2007

F-4

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETSDecember 31, 2006 and 2005(In thousands, except fractions, percentages and par value amounts)**

| ** **                                                                                                                                                                                                                                                                                                                                                                                                                                                               | ** ** | **December 31,  2006** | ** ** | **December 31,  2005** | ** ** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|-----------------------------|------------|-----------------------------|------------|
| **ASSETS**                                                                                                                                                                                                                                                                                                                                                                                                                                                               | ** ** |                        | ** ** | ** **                  |       |   | ** ** | ** ** |   |
| Real estate:                                                                                                                                                                                                                                                                                                                                                                                                                                                             |       |                        |       |                        |       |   |   |   |   |
| Land                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |       |                        | $          | 724,596                     |       |   |   | $ | 724,901 |   |   |
| Buildings and improvements                                                                                                                                                                                                                                                                                                                                                                                                                                               |       |                        | 2,841,158  |                        |       |   | 2,668,177 |   |   |
| Accumulated depreciation and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                |       |                        | (430,207   | )                           |       |   | (376,816 | ) |   |
| Net real estate                                                                                                                                                                                                                                                                                                                                                                                                                                                          |       |                        | 3,135,547  |                        |       |   | 3,016,262 |   |   |
| Real estate held for sale                                                                                                                                                                                                                                                                                                                                                                                                                                                |       |                        | 28,649     |                        |       |   | 19,244 |   |   |
| Cash and cash equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                |       |                        | 7,916      |                        |       |   | 9,202 |   |   |
| Restricted cash                                                                                                                                                                                                                                                                                                                                                                                                                                                          |       |                        | 23,662     |                        |       |   | 19,906 |   |   |
| Marketable securities                                                                                                                                                                                                                                                                                                                                                                                                                                                    |       |                        | 5,847      |                        |       |   | 3,014 |   |   |
| Receivables:                                                                                                                                                                                                                                                                                                                                                                                                                                                             |       |                        |       |                        |       |   |   |   |   |
| Trade, net of allowance for doubtful accounts of $19,386 and $27,540  as of December 31, 2006 and 2005, respectively                                                                                                                                                                                                                                                                                                                                                |       |                        | 29,422     |                        |       |   | 20,751 |   |   |
| Deferred rent, net of allowance of $1,702 and $1,592 as of  December 31, 2006 and 2005, respectively                                                                                                                                                                                                                                                                                                                                                                |       |                        | 32,169     |                        |       |   | 29,314 |   |   |
| Other, net                                                                                                                                                                                                                                                                                                                                                                                                                                                               |       |                        | 22,582     |                        |       |   | 25,138 |   |   |
| Mortgages and notes receivable                                                                                                                                                                                                                                                                                                                                                                                                                                           |       |                        | 4,412      |                        |       |   | 795 |   |   |
| Prepaid expenses and deferred charges                                                                                                                                                                                                                                                                                                                                                                                                                                    |       |                        | 47,550     |                        |       |   | 43,346 |   |   |
| Investments in / advances to unconsolidated ventures                                                                                                                                                                                                                                                                                                                                                                                                                     |       |                        | 91,401     |                        |       |   | 95,538 |   |   |
| Intangible assets, net of accumulated amortization of $19,754 and  $10,927 as of December 31, 2006 and 2005, respectively                                                                                                                                                                                                                                                                                                                                           |       |                        | 88,256     |                        |       |   | 78,046 |   |   |
| Other assets                                                                                                                                                                                                                                                                                                                                                                                                                                                             |       |                        | 17,486     |                        |       |   | 9,206 |   |   |
| Total assets                                                                                                                                                                                                                                                                                                                                                                                                                                                             |       |                        | $          | 3,534,899                   |       |   |   | $ | 3,369,762 |   |   |
| **LIABILITIES AND  STOCKHOLDERS’ EQUITY**                                                                                                                                                                                                                                                                                                                                                                                                                           | ** ** |                        | ** ** | ** **                  |       |   | ** ** | ** ** |   |
| Liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                             |       |                        |       |                        |       |   |   |   |   |
| Mortgages payable, including unamortized premium of $11,563 and  $13,871 as of December 31, 2006 and 2005, respectively                                                                                                                                                                                                                                                                                                                                             |       |                        | $          | 448,910                     |       |   |   | $ | 433,653 |   |   |
| Notes payable, net of unamortized discount of $5,911 and $4,822 as of  December 31, 2006 and 2005, respectively                                                                                                                                                                                                                                                                                                                                                          |       |                        | 1,166,950  |                        |       |   | 968,347 |   |   |
| Credit facilities                                                                                                                                                                                                                                                                                                                                                                                                                                                        |       |                        | 191,000    |                        |       |   | 215,000 |   |   |
| Capital leases                                                                                                                                                                                                                                                                                                                                                                                                                                                           |       |                        | 27,500     |                        |       |   | 27,881 |   |   |
| Dividends payable                                                                                                                                                                                                                                                                                                                                                                                                                                                        |       |                        | 37,529     |                        |       |   | 37,826 |   |   |
| Other liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                        |       |                        | 150,585    |                        |       |   | 127,369 |   |   |
| Tenant security deposits                                                                                                                                                                                                                                                                                                                                                                                                                                                 |       |                        | 10,203     |                        |       |   | 10,641 |   |   |
| Total liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                        |       |                        | 2,032,677  |                        |       |   | 1,820,717 |   |   |
| Minority interest in consolidated partnership and joint ventures                                                                                                                                                                                                                                                                                                                                                                                                         |       |                        | 57,485     |                        |       |   | 57,659 |   |   |
| Commitments and contingencies                                                                                                                                                                                                                                                                                                                                                                                                                                            |       |                        | —     |                        |       |   | — |   |   |
| Stockholders’ equity:                                                                                                                                                                                                                                                                                                                                                                                                                                               |       |                        |       |                        |       |   |   |   |   |
| Preferred stock, $0.01 par value, 25,000 shares authorized;  Series D: 1,500 depositary shares, each representing 1/10 of one share  of Series D Cumulative Voting Step-Up Premium Rate Preferred, 150 shares  outstanding at December 31, 2006 and 2005; Series E: 8,000 depositary  shares, each representing 1/10 of one share of 7.625% Series E  Cumulative Redeemable Preferred, 800 shares outstanding as of December 31,  2006 and 2005 |       |                        | 10         |                        |       |   | 10 |   |   |
| Common stock, $0.01 par value, 250,000 shares authorized; 103,420 and  104,305 shares issued and outstanding as of December 31, 2006 and 2005,  respectively                                                                                                                                                                                                                                                                                                        |       |                        | 1,034      |                        |       |   | 1,042 |   |   |
| Additional paid-in capital                                                                                                                                                                                                                                                                                                                                                                                                                                               |       |                        | 2,009,705  |                        |       |   | 2,036,880 |   |   |
| Accumulated other comprehensive loss                                                                                                                                                                                                                                                                                                                                                                                                                                     |       |                        | (10,850    | )                           |       |   | (8,074 | ) |   |
| Accumulated distributions in excess of net income                                                                                                                                                                                                                                                                                                                                                                                                                        |       |                        | (555,162   | )                           |       |   | (538,472 | ) |   |
| Total stockholders’ equity                                                                                                                                                                                                                                                                                                                                                                                                                                          |       |                        | 1,444,737  |                        |       |   | 1,491,386 |   |   |
| Total liabilities and stockholders’ equity                                                                                                                                                                                                                                                                                                                                                                                                                          |       |                        | $          | 3,534,899                   |       |   |   | $ | 3,369,762 |   |   |

** **

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

F-5

----

**NEW PLAN EXCELREALTY TRUST, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOMEFor the Years Ended December 31, 2006, 2005 and 2004(In thousands, except per share amounts)**

| ** **                                                                                                              | ** ** | **December 31,   2006** | ** ** | **December 31,   2005** | ** ** | **December 31,   2004** | ** ** |
|-------------------------------------------------------------------------------------------------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|
| Revenues:                                                                                                               |       |                              |       |                              |       |                              |       |   |   |   |   |   |   |
| Rental income                                                                                                           |       |                              | $          | 334,349                           |       |                              |       | $ | 358,869 |   |   |   | $ | 367,511 |   |   |
| Percentage rents                                                                                                        |       |                              | 4,903      |                              |       |                              | 5,811      |   |   |   | 5,979 |   |   |
| Expense  reimbursements                                                                                                 |       |                              | 101,063    |                              |       |                              | 97,656     |   |   |   | 92,824 |   |   |
| Fee income                                                                                                              |       |                              | 16,660     |                              |       |                              | 10,957     |   |   |   | 4,797 |   |   |
| Total revenues                                                                                                          |       |                              | 456,975    |                              |       |                              | 473,293    |   |   |   | 471,111 |   |   |
| Operating expenses:                                                                                                     |       |                              |       |                              |       |                              |       |   |   |   |   |   |   |
| Operating costs                                                                                                         |       |                              | 72,672     |                              |       |                              | 75,511     |   |   |   | 79,221 |   |   |
| Real estate taxes                                                                                                       |       |                              | 59,564     |                              |       |                              | 64,414     |   |   |   | 58,572 |   |   |
| Depreciation and  amortization                                                                                          |       |                              | 88,905     |                              |       |                              | 89,973     |   |   |   | 86,487 |   |   |
| Provision for  doubtful accounts                                                                                        |       |                              | 7,922      |                              |       |                              | 11,167     |   |   |   | 8,763 |   |   |
| General and  administrative                                                                                             |       |                              | 28,674     |                              |       |                              | 26,361     |   |   |   | 17,674 |   |   |
| Total operating  expenses                                                                                               |       |                              | 257,737    |                              |       |                              | 267,426    |   |   |   | 250,717 |   |   |
| Income before real  estate sales, impairment of real estate, minority interest and  other income and expenses |       |                              | 199,238    |                              |       |                              | 205,867    |   |   |   | 220,394 |   |   |
| Other income and  expenses:                                                                                             |       |                              |       |                              |       |                              |       |   |   |   |   |   |   |
| Interest,  dividend, and other income                                                                                   |       |                              | 4,016      |                              |       |                              | 4,219      |   |   |   | 3,517 |   |   |
| Equity in income  of unconsolidated ventures                                                                            |       |                              | 5,143      |                              |       |                              | 4,045      |   |   |   | 1,513 |   |   |
| Interest expense                                                                                                        |       |                              | (94,202    | )                                 |       |                              | (118,043   | ) |   |   | (106,054 | ) |   |
| Impairment of real  estate                                                                                              |       |                              | —     |                              |       |                              | (859       | ) |   |   | (43 | ) |   |
| Minority interest  in income of consolidated partnership and joint ventures                                             |       |                              | (745       | )                                 |       |                              | (5,953     | ) |   |   | (853 | ) |   |
| Income from  continuing operations                                                                                      |       |                              | 113,450    |                              |       |                              | 89,276     |   |   |   | 118,474 |   |   |
| Income from  discontinued operations (Note 5)                                                                           |       |                              | 21,766     |                              |       |                              | 30,140     |   |   |   | 14,249 |   |   |
| Income before gain  on sale of real estate                                                                              |       |                              | 135,216    |                              |       |                              | 119,416    |   |   |   | 132,723 |   |   |
| Gain on sale of  real estate                                                                                            |       |                              | 1          |                              |       |                              | 186,908    |   |   |   | 1,217 |   |   |
| Net income                                                                                                              |       |                              | $          | 135,217                           |       |                              |       | $ | 306,324 |   |   |   | $ | 133,940 |   |   |
| Preferred  dividends                                                                                                    |       |                              | (21,966    | )                                 |       |                              | (21,888    | ) |   |   | (21,470 | ) |   |
| Net income  available to common stock—basic                                                                        |       |                              | 113,251    |                              |       |                              | 284,436    |   |   |   | 112,470 |   |   |
| Minority interest  in income of consolidated partnership                                                                |       |                              | 745        |                              |       |                              | 5,070      |   |   |   | 796 |   |   |
| Net income  available to common stock—diluted                                                                      |       |                              | $          | 113,996                           |       |                              |       | $ | 289,506 |   |   |   | $ | 113,266 |   |   |
| Basic earnings per common  share:                                                                                       |       |                              |       |                              |       |                              |       |   |   |   |   |   |   |
| Income from  continuing operations                                                                                      |       |                              | $          | 0.88                              |       |                              |       | $ | 2.46 |   |   |   | $ | 0.98 |   |   |
| Discontinued  operations                                                                                                |       |                              | 0.21       |                              |       |                              | 0.29       |   |   |   | 0.13 |   |   |
| Basic earnings per  share                                                                                               |       |                              | $          | 1.09                              |       |                              |       | $ | 2.75 |   |   |   | $ | 1.11 |   |   |
| Diluted earnings per  common share:                                                                                     |       |                              |       |                              |       |                              |       |   |   |   |   |   |   |
| Income from  continuing operations                                                                                      |       |                              | $          | 0.85                              |       |                              |       | $ | 2.43 |   |   |   | $ | 0.97 |   |   |
| Discontinued  operations                                                                                                |       |                              | 0.20       |                              |       |                              | 0.28       |   |   |   | 0.13 |   |   |
| Diluted earnings  per share                                                                                             |       |                              | $          | 1.05                              |       |                              |       | $ | 2.71 |   |   |   | $ | 1.10 |   |   |
| Average shares  outstanding—basic                                                                                  |       |                              | 104,102    |                              |       |                              | 103,393    |   |   |   | 100,894 |   |   |
| Average shares  outstanding—diluted                                                                                |       |                              | 108,814    |                              |       |                              | 106,834    |   |   |   | 103,345 |   |   |
| Dividends per  common share (1)                                                                                         |       |                              | $          | 1.25                              |       |                              |       | $ | 4.45 |   |   |   | $ | 1.65 |   |   |
| Other comprehensive  income:                                                                                            |       |                              |       |                              |       |                              |       |   |   |   |   |   |   |
| Net income                                                                                                              |       |                              | $          | 135,217                           |       |                              |       | $ | 306,324 |   |   |   | $ | 133,940 |   |   |
| Realized/unrealized  (loss) gain on available-for-sale securities                                                       |       |                              | 259        |                              |       |                              | (420       | ) |   |   | 517 |   |   |
| Unrealized gains  on securities held for deferred compensation                                                          |       |                              | 131        |                              |       |                              | 39         |   |   |   | — |   |   |
| Realized (loss) gain  on interest hedges, net                                                                           |       |                              | 1,435      |                              |       |                              | (11,157    | ) |   |   | 161 |   |   |
| Unrealized gain  (loss) on interest hedges, net                                                                         |       |                              | (4,601     | )                                 |       |                              | 8,495      |   |   |   | (8,494 | ) |   |
| Comprehensive  income                                                                                                   |       |                              | $          | 132,441                           |       |                              |       | $ | 303,281 |   |   |   | $ | 126,124 |   |   |

----

(1)             For the year ended December 31, 2005,amount includes a special cash distribution of $3.00 per common share paid on September 27,2005 (Note 14).

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

F-6

----

**NEW PLAN EXCELREALTY TRUST, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITYFor the Years Ended December 31, 2006, 2005 and 2004(In thousands)**

| ** **                                                                              | ** ** | **Preferred Stock** | ** ** | **Shares of Beneficial  Interest/  Common Stock** | ** ** | **Additional   Paid-in** | ** ** | **Accumulated  Other  Comprehensive** | ** ** | **Accumulated  Distributions  in Excess of** | ** ** | **Total  Stockholders’** | ** ** |
|-----------------------------------------------------------------------------------------|------------|--------------------------|------------|------------------------------------------------------------------|------------|-------------------------------|------------|---------------------------------------|------------|--------------------------------------------------------|------------|-------------------------------|------------|
| ** **                                                                              | ** ** | **Number**               | ** ** | **Amount**                                                       | ** ** | **Number**                    | ** ** | **Amount**                            | ** ** | **Capital**                                            | ** ** | **Income**                    | ** ** | **Net Income** | ** ** | **Equity** | ** ** |
| Balance at December 31, 2003                                                       |       |                     | 950        |                                                             |       |                          | $          | 10                                    |       |                                                   |       | 97,980                        |       |   |   | $ | 979 |   |   | $ | 1,889,338 |   |   | $ | 2,785 |   |   |   | $ | (306,969 | ) |   |   | $ | 1,586,143 |   |   |
| Net income                                                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | — |   |   |   | 133,940 |   |   |   | 133,940 |   |   |
| Dividends                                                                               |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | — |   |   |   | (188,424 | ) |   |   | (188,424 | ) |   |
| Exercise of stock options                                                               |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 952        |                          |       |   | 10 |   |   | 19,066 |   |   | — |   |   |   | — |   |   |   | 19,076 |   |   |
| Shares repurchased and retired                                                          |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | (2         | )                             |       |   | — |   |   | (52 | ) |   | — |   |   |   | — |   |   |   | (52 | ) |   |
| Employee loans                                                                          |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | 291 |   |   | — |   |   |   | — |   |   |   | 291 |   |   |
| Dividend Reinvestment Plan                                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 465        |                          |       |   | 5 |   |   | 11,184 |   |   | — |   |   |   | — |   |   |   | 11,189 |   |   |
| Stock incentive grants                                                                  |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 65         |                          |       |   | — |   |   | 898 |   |   | — |   |   |   | — |   |   |   | 898 |   |   |
| Option grant                                                                            |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | 664 |   |   | — |   |   |   | — |   |   |   | 664 |   |   |
| Redemption of limited partner units for shares of  common stock                         |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 1,385      |                          |       |   | 14 |   |   | 34,598 |   |   | — |   |   |   | — |   |   |   | 34,612 |   |   |
| Realized/unrealized holding gain on marketable securities                               |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | 517 |   |   |   | — |   |   |   | 517 |   |   |
| Realized gain on interest hedges                                                        |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | 161 |   |   |   | — |   |   |   | 161 |   |   |
| Unrealized loss on interest hedges                                                      |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | (8,494 | ) |   |   | — |   |   |   | (8,494 | ) |   |
| Stock offering                                                                          |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 2,000      |                          |       |   | 20 |   |   | 49,620 |   |   | — |   |   |   | — |   |   |   | 49,640 |   |   |
| Impact of non-cash adjustments to account for  Preferred D dividend “step-up” |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | 370 |   |   | — |   |   |   | (370 | ) |   |   | — |   |   |
| Balance at December 31, 2004                                                       |       |                     | 950        |                                                             |       |                          | 10         |                                  |       |                                                   | 102,845    |                          |       |   | 1,028 |   |   | 2,005,977 |   |   | (5,031 | ) |   |   | (361,823 | ) |   |   | 1,640,161 |   |   |
| Net income                                                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | — |   |   |   | 306,324 |   |   |   | 306,324 |   |   |
| Dividends (1)                                                                           |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | — |   |   |   | (482,973 | ) |   |   | (482,973 | ) |   |
| Exercise of stock options                                                               |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 487        |                          |       |   | 5 |   |   | 8,677 |   |   | — |   |   |   | — |   |   |   | 8,682 |   |   |
| Forfeiture of equity award                                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | (11        | )                             |       |   | — |   |   | (295 | ) |   | — |   |   |   | — |   |   |   | (295 | ) |   |
| Shares repurchased and retired                                                          |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | (2         | )                             |       |   | — |   |   | (47 | ) |   | — |   |   |   | — |   |   |   | (47 | ) |   |
| Employee loans                                                                          |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | 119 |   |   | — |   |   |   | — |   |   |   | 119 |   |   |
| Dividend Reinvestment Plan                                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 919        |                          |       |   | 9 |   |   | 21,739 |   |   | — |   |   |   | — |   |   |   | 21,748 |   |   |
| Stock incentive grants                                                                  |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 67         |                          |       |   | — |   |   | 239 |   |   | — |   |   |   | — |   |   |   | 239 |   |   |
| Option grant                                                                            |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | (161 | ) |   | — |   |   |   | — |   |   |   | (161 | ) |   |
| Redemption of limited partner units for shares of  common stock                         |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | (161 | ) |   | — |   |   |   | — |   |   |   | (161 | ) |   |
| Realized/unrealized holding gain on marketable  securities                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | (420 | ) |   |   | — |   |   |   | (420 | ) |   |
| Unrealized gains on securities held for deferred compensation                           |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | 39 |   |   |   | — |   |   |   | 39 |   |   |
| Realized gain/loss on interest hedges, net                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | (11,157 | ) |   |   | — |   |   |   | (11,157 | ) |   |
| Unrealized losses on interest hedges                                                    |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | 8,495 |   |   |   | — |   |   |   | 8,495 |   |   |
| Impact of non-cash adjustments to account for  Preferred D dividend “step-up” |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | 793 |   |   | — |   |   |   | — |   |   |   | 793 |   |   |
| Balance at December 31, 2005                                                       |       |                     | 950        |                                                             |       |                          | 10         |                                  |       |                                                   | 104,305    |                          |       |   | 1,042 |   |   | 2,036,880 |   |   | (8,074 | ) |   |   | (538,472 | ) |   |   | 1,491,386 |   |   |
| Net income                                                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | — |   |   |   | 135,217 |   |   |   | 135,217 |   |   |
| Dividends                                                                               |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | — |   |   |   | (151,907 | ) |   |   | (151,907 | ) |   |
| Exercise of stock options                                                               |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 509        |                          |       |   | 5 |   |   | 8,357 |   |   | — |   |   |   | — |   |   |   | 8,362 |   |   |
| Forfeiture of equity award                                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | (1         | )                             |       |   | — |   |   | — |   |   | — |   |   |   | — |   |   |   | — |   |   |
| Shares repurchased and retired                                                          |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | (1,870     | )                             |       |   | (18 | ) |   | (50,127 | ) |   | — |   |   |   | — |   |   |   | (50,145 | ) |   |
| Employee loans                                                                          |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | 115 |   |   | — |   |   |   | — |   |   |   | 115 |   |   |
| Dividend Reinvestment Plan                                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 302        |                          |       |   | 3 |   |   | 7,509 |   |   | — |   |   |   | — |   |   |   | 7,512 |   |   |
| Stock incentive grants                                                                  |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 57         |                          |       |   | 1 |   |   | 179 |   |   | — |   |   |   | — |   |   |   | 180 |   |   |
| Option grant                                                                            |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | 2,630 |   |   | — |   |   |   | — |   |   |   | 2,630 |   |   |
| Redemption of limited partner units for shares of  common stock                         |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | 118        |                          |       |   | 1 |   |   | 3,295 |   |   | — |   |   |   | — |   |   |   | 3,296 |   |   |
| Realized/unrealized holding gain on marketable  securities                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | 259 |   |   |   | — |   |   |   | 259 |   |   |
| Unrealized gain/loss on securities held for deferred  compensation, net                 |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | 131 |   |   |   | — |   |   |   | 131 |   |   |
| Realized gain/loss on interest hedges, net                                              |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | 1,435 |   |   |   | — |   |   |   | 1,435 |   |   |
| Unrealized gain/loss on interest hedges, net                                            |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | — |   |   | (4,601 | ) |   |   | — |   |   |   | (4,601 | ) |   |
| Impact of non-cash adjustments to account for  Preferred D dividend “step-up” |       |                     | —     |                                                             |       |                          | —     |                                  |       |                                                   | —     |                          |       |   | — |   |   | 867 |   |   | — |   |   |   | — |   |   |   | 867 |   |   |
| Balance at December 31, 2006                                                       |       |                     | 950        |                                                             |       |                          | $          | 10                                    |       |                                                   |       | 103,420                       |       |   |   | $ | 1,034 |   |   | $ | 2,009,705 |   |   | $ | (10,850 | ) |   |   | $ | (555,162 | ) |   |   | $ | 1,444,737 |   |   |

----

(1)                Amount includes a special cash distribution of $3.00per common share paid on September 27, 2005 (Note 14).

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

F-7

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWSFor the Years Ended December 31, 2006, 2005 and 2004(In thousands)**

| ** **                                                               | ** ** | **Year Ended**             | ** ** | **Year Ended**             | ** ** | **Year Ended**             | ** ** |
|--------------------------------------------------------------------------|------------|---------------------------------|------------|---------------------------------|------------|---------------------------------|------------|
| ** **                                                               | ** ** | **December 31, 2006** | ** ** | **December 31, 2005** | ** ** | **December 31, 2004** | ** ** |
| Cash flows from operating  activities:                                   |       |                            |       |                            |       |                            |       |   |   |   |   |   |   |
| Net income                                                               |       |                            | $          | 135,219                         |       |                            |       | $ | 306,324 |   |   |   | $ | 133,940 |   |   |
| Adjustments  to reconcile net income to net cash provided by operations: |       |                            |       |                            |       |                            |       |   |   |   |   |   |   |
| Depreciation and amortization                                            |       |                            | 92,060     |                            |       |                            | 95,137     |   |   |   | 92,270 |   |   |
| Amortization of net premium/discount on mortgages and notes payable      |       |                            | (2,534     | )                               |       |                            | (7,164     | ) |   |   | (2,923 | ) |   |
| Amortization of deferred debt and loan acquisition costs                 |       |                            | 2,483      |                            |       |                            | 3,895      |   |   |   | 2,809 |   |   |
| Amortization of stock options                                            |       |                            | 2,711      |                            |       |                            | 2,372      |   |   |   | 681 |   |   |
| Interest on swaps                                                        |       |                            | 1,929      |                            |       |                            | 599        |   |   |   | — |   |   |
| Amortization of asset retirement obligations                             |       |                            | 306        |                            |       |                            | —     |   |   |   | — |   |   |
| Amortization of below market leases                                      |       |                            | (1,993     | )                               |       |                            | (210       | ) |   |   | 27 |   |   |
| Gain on sale of real estate and securities, net                          |       |                            | —     |                            |       |                            | (186,907   | ) |   |   | (1,217 | ) |   |
| (Gain) loss on sale of discontinued operations                           |       |                            | (14,650    | )                               |       |                            | (17,789    | ) |   |   | 1,139 |   |   |
| Minority interest in income of partnership                               |       |                            | 745        |                            |       |                            | 5,954      |   |   |   | 986 |   |   |
| Impairment of real estate assets                                         |       |                            | 907        |                            |       |                            | 859        |   |   |   | 131 |   |   |
| Equity in income of unconsolidated ventures                              |       |                            | (5,143     | )                               |       |                            | (4,045     | ) |   |   | (2,078 | ) |   |
| Distributions of income from unconsolidated ventures                     |       |                            | 5,879      |                            |       |                            | 3,812      |   |   |   | — |   |   |
| Changes  in operating assets and liabilities, net:                       |       |                            |       |                            |       |                            |       |   |   |   |   |   |   |
| Change in restricted cash                                                |       |                            | (3,456     | )                               |       |                            | 2,472      |   |   |   | 1,229 |   |   |
| Change in trade receivables                                              |       |                            | (8,671     | )                               |       |                            | 10,302     |   |   |   | 9,062 |   |   |
| Change in deferred rent receivables                                      |       |                            | (2,458     | )                               |       |                            | (3,819     | ) |   |   | (7,106 | ) |   |
| Change in other receivables                                              |       |                            | 2,556      |                            |       |                            | (6,513     | ) |   |   | (4,564 | ) |   |
| Change in other liabilities                                              |       |                            | 1,565      |                            |       |                            | 16,822     |   |   |   | 2,155 |   |   |
| Change in tenant security deposits                                       |       |                            | (438       | )                               |       |                            | (906       | ) |   |   | 1,347 |   |   |
| Change in sundry assets and liabilities                                  |       |                            | 2,140      |                            |       |                            | 1,171      |   |   |   | (5,933 | ) |   |
| Net cash provided by operating activities                                |       |                            | 209,157    |                            |       |                            | 222,366    |   |   |   | 221,955 |   |   |
| Cash flows from investing  activities:                                   |       |                            |       |                            |       |                            |       |   |   |   |   |   |   |
| Real estate acquisitions and building improvements                       |       |                            | (125,332   | )                               |       |                            | (150,885   | ) |   |   | (120,283 | ) |   |
| Acquisition, net of cash and restricted cash received                    |       |                            | (145,419   | )                               |       |                            | (186,856   | ) |   |   | (186,733 | ) |   |
| Proceeds from real estate sales, net                                     |       |                            | 120,961    |                            |       |                            | 1,060,456  |   |   |   | 48,269 |   |   |
| Repayments of mortgage notes receivable, net                             |       |                            | (3,617     | )                               |       |                            | 11,800     |   |   |   | 18,220 |   |   |
| Leasing commissions paid                                                 |       |                            | (10,059    | )                               |       |                            | (11,405    | ) |   |   | (10,671 | ) |   |
| Cash paid for asset management fee stream                                |       |                            | —     |                            |       |                            | (18,500    | ) |   |   | — |   |   |
| Cash paid for property management rights                                 |       |                            | —     |                            |       |                            | (22,251    | ) |   |   | — |   |   |
| Cash from joint venture consolidation (Note 2)                           |       |                            | 68         |                            |       |                            | —     |   |   |   | 1,171 |   |   |
| Cash paid for joint venture interest                                     |       |                            | —     |                            |       |                            | (5,441     | ) |   |   | (9,748 | ) |   |
| Proceeds from sale of joint venture interest                             |       |                            | —     |                            |       |                            | 11,400     |   |   |   | 3,870 |   |   |
| Capital contributions to unconsolidated joint ventures                   |       |                            | (8,295     | )                               |       |                            | (57,663    | ) |   |   | (7,900 | ) |   |
| Distributions of capital from unconsolidated ventures                    |       |                            | 16,884     |                            |       |                            | 5,450      |   |   |   | 9,511 |   |   |
| Net cash (used in) provided by investing activities                      |       |                            | (154,809   | )                               |       |                            | 636,105    |   |   |   | (254,294 | ) |   |
| Cash flows from financing  activities:                                   |       |                            |       |                            |       |                            |       |   |   |   |   |   |   |
| Principal payments of mortgages and notes payable                        |       |                            | (35,382    | )                               |       |                            | (139,490   | ) |   |   | (79,593 | ) |   |
| Proceeds from public debt offering, net                                  |       |                            | 198,000    |                            |       |                            | 349,044    |   |   |   | 149,114 |   |   |
| Repayment of public debt                                                 |       |                            | —     |                            |       |                            | (350,000   | ) |   |   | (75,000 | ) |   |
| Cash paid to settle swap agreement                                       |       |                            | —     |                            |       |                            | (11,945    | ) |   |   | 279 |   |   |
| Proceeds from credit facility borrowing                                  |       |                            | 220,000    |                            |       |                            | 490,000    |   |   |   | 496,000 |   |   |
| Repayment of credit facility                                             |       |                            | (244,000   | )                               |       |                            | (721,000   | ) |   |   | (341,000 | ) |   |
| Financing fees                                                           |       |                            | (4,242     | )                               |       |                            | (4,172     | ) |   |   | (5,435 | ) |   |
| Cash paid to redeem limited partnership units                            |       |                            | (554       | )                               |       |                            | —     |   |   |   | — |   |   |
| Distributions paid to minority partners                                  |       |                            | (3,942     | )                               |       |                            | (7,514     | ) |   |   | (3,848 | ) |   |
| Dividends paid                                                           |       |                            | (151,354   | )                               |       |                            | (492,051   | ) |   |   | (186,421 | ) |   |
| Proceeds from exercise of stock options                                  |       |                            | 8,262      |                            |       |                            | 8,685      |   |   |   | 19,087 |   |   |
| Repayment of loans receivable for the purchase of common stock           |       |                            | 115        |                            |       |                            | 119        |   |   |   | 291 |   |   |
| Proceeds from common stock offering                                      |       |                            | —     |                            |       |                            | —     |   |   |   | 49,640 |   |   |
| Cash paid for repurchase of common stock                                 |       |                            | (50,145    | )                               |       |                            | —     |   |   |   | — |   |   |
| Proceeds from dividend reinvestment plan                                 |       |                            | 7,608      |                            |       |                            | 21,763     |   |   |   | 11,189 |   |   |
| Net cash (used in) provided by financing activities                      |       |                            | (55,634    | )                               |       |                            | (856,561   | ) |   |   | 34,303 |   |   |
| Net (decrease) increase in cash and cash equivalents                     |       |                            | (1,286     | )                               |       |                            | 1,910      |   |   |   | 1,964 |   |   |
| Cash  and cash equivalents at beginning of year                          |       |                            | 9,202      |                            |       |                            | 7,292      |   |   |   | 5,328 |   |   |
| Cash  and cash equivalents at end of year                                |       |                            | $          | 7,916                           |       |                            |       | $ | 9,202 |   |   |   | $ | 7,292 |   |   |
| Supplemental Cash Flow  Disclosure, including Non-Cash Activities:       |       |                            |       |                            |       |                            |       |   |   |   |   |   |   |
| Cash paid for interest, net of amounts capitalized                       |       |                            | $          | 112,121                         |       |                            |       | $ | 125,970 |   |   |   | $ | 114,615 |   |   |
| Capitalized interest                                                     |       |                            | 11,838     |                            |       |                            | 8,485      |   |   |   | 6,433 |   |   |
| State and local taxes paid                                               |       |                            | 420        |                            |       |                            | 70         |   |   |   | 532 |   |   |
| Mortgages assumed, net                                                   |       |                            | 43,613     |                            |       |                            | 27,797     |   |   |   | 69,074 |   |   |
| Partnership units issued in acquisition                                  |       |                            | 4,770      |                            |       |                            | 29,547     |   |   |   | 19,989 |   |   |
| Satisfaction of notes receivable                                         |       |                            | —     |                            |       |                            | —     |   |   |   | 15,091 |   |   |

 

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

F-8

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

**1. Description of Business**

New Plan Excel RealtyTrust, Inc. (together with its wholly-owned and majority-ownedsubsidiaries and consolidated entities, the “Company”) is operated as aself-administered, self-managed real estate investment trust (“REIT”). Theprincipal business of the Company is the ownership and management of communityand neighborhood shopping centers throughout the United States.

**2. Summary of Significant Accounting Policies**

*Principlesof Consolidation*

The accompanyingconsolidated financial statements reflect the accounts of the Company. Theportion of these entities not owned by the Company is presented as minorityinterest as of and during the periods presented. All material inter-entitytransactions have been eliminated.

When the Company obtainsan economic interest in an entity, the Company evaluates the entity todetermine (i) if the entity is a variable interest entity (“VIE”), (ii) ifthe Company is the primary beneficiary, in accordance with Financial AccountingStandards Board (“FASB”) Interpretation No. 46R, *Consolidationof Variable Interest Entities* (“FIN 46”) and (iii) whether theCompany has a controlling interest in the entity, in accordance with the FASB’sEmerging Issues Task Force (“EITF”) Issue No. 04-5, *Determining Whether a General Partner, or the General Partners as aGroup, Controls a Limited Partnership or Similar Entity When the LimitedPartners Have Certain Rights* (“EITF 04-5”). The Companyconsolidates (i) entities that are VIEs and of which the Company is deemedto be the primary beneficiary in accordance with FIN 46 and (ii) entitiesthat are non-VIEs which the Company controls in accordance with EITF 04-5.Entities that the Company accounts for under the equity method (i.e., at cost,increased or decreased by the Company’s share of earnings or losses, lessdistributions) include (i) entities that are VIEs and of which the Companyis not deemed to be the primary beneficiary and (ii) entities that arenon-VIEs which the Company does not control, but over which the Company has theability to exercise significant influence. The Company will reconsider itsdetermination of whether an entity is a VIE and who qualifies as the primarybeneficiary if certain events occur that are likely to cause a change in theoriginal determinations.

*Basis ofPresentation*

The consolidated financialstatements have been prepared by the Company pursuant to the rules of theSEC and, in the opinion of the Company, include all adjustments (consisting ofnormal recurring adjustments) necessary for a fair statement of financialposition, results of operations and cash flows in accordance with accountingprinciples generally accepted in the United States (“GAAP”). Certaininformation and footnote disclosures normally included in consolidated financialstatements prepared in accordance with GAAP have been condensed or omittedpursuant to such SEC rules. The Company believes that the disclosures made areadequate to make the information presented not misleading. 

*Earningsper Share of Common Stock*

In accordance withStatement of Financial Accounting Standards (“SFAS”) No. 128, *Earnings per Share*(“SFAS No. 128”), the Companypresents both basic and diluted earnings per share. Earnings per common share (“basicEPS”) is computed by dividing net income available to common stockholders bythe weighted average number of shares of common stock outstanding for theperiod. Earnings per share of common stock assuming dilution (“diluted EPS”) iscomputed by giving effect to all dilutive potential shares of common stock thatwere outstanding during the period. Dilutive potential shares of common stockconsist of the incremental shares of common stock issuable upon (a) theconversion of (i) limited 

F-9

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

partnershipunits of Excel Realty Partners, L.P. (“ERP”), a Delaware limited partnership, (ii) convertiblesenior notes, (iii) restricted stock grants and (iv) contingentcompensation awards and (b) the exercise of in-the-money stock options.

*CashEquivalents*

Cash equivalents consistof short-term, highly liquid debt instruments with maturities of three monthsor less at acquisition. Items classified as cash equivalents include insuredbank certificates of deposit and commercial paper. At times, cash balances at alimited number of banks may exceed insurable amounts. The Company believes itmitigates this risk by investing in or through major financial institutions.

*RestrictedCash*

Restricted cash consistsprimarily of cash held in escrow accounts for deferred maintenance, capitalimprovements, environmental expenditures, taxes, insurance, operating expensesand debt service as required by certain loan agreements. Substantially allrestricted cash is invested in money market mutual funds and carried at marketvalue.

*AccountsReceivable*

Accounts receivable isstated net of allowance for doubtful accounts of $19.4 million and $27.5million as of December 31, 2006 and 2005, respectively. The Company makesestimates of the uncollectability of its accounts receivable related to baserents, expense reimbursements and other revenues. The Company analyzes accountsreceivable and historical bad debt levels, customer credit-worthiness andcurrent economic trends when evaluating the adequacy of the allowance fordoubtful accounts. In addition, tenants in bankruptcy are analyzed and estimatesare made in connection with the expected recovery of pre-petition andpost-petition claims.

*RealEstate*

Land, buildings andbuilding and tenant improvements are recorded at cost and stated at cost lessaccumulated depreciation. Major replacements and betterments, which improve orextend the life of the asset, are capitalized and depreciated over theirestimated useful lives; ordinary repairs and maintenance are expensed asincurred. Land, buildings and building and tenant improvements that are underredevelopment, or are being developed, are carried at cost and no depreciationis recorded on these assets. Additionally, amounts essential to the developmentof the property, such as pre-construction costs, development costs,construction costs, interest costs, real estate taxes, salaries and relatedcosts and other costs incurred during the period of development are capitalized.The Company ceases capitalization when the property is available for occupancyupon substantial completion of tenant improvements, but in any event no laterthan one year from the completion of major construction activity.

Propertiesare depreciated using the straight-line method over the estimated useful livesof the assets. The estimated useful lives are as follows:

| Buildings              |   | 35 to 40 years                                               |
|------------------------|--------|--------------------------------------------------------------|
| Building improvements. |   | 5 to 40 years                                                |
| Tenant improvements    |   | The shorter of the term of the related lease or  useful life |

 

F-10

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

*Business Combinations*

In connection with the Company’s acquisition ofproperties, purchase costs are allocated to the tangible and intangible assetsand liabilities acquired based on their estimated fair values. The value of thetangible assets, consisting of land, buildings and building and tenantimprovements, are determined as if vacant (i.e., at replacement cost). Intangibleassets, including the above-market value of leases and the value of in-placeleases,  are recorded at their relativefair values. The below-market value of leases is recorded in Other liabilities.

Above-market, below-market and in-place lease values forowned properties are recorded based on the present value (using an interestrate reflecting the risks associated with the leases acquired) of thedifference between (i) the contractual amounts to be paid pursuant to theleases negotiated and in-place at the time of acquisition and (ii) management’sestimate of fair market lease rates for the property or equivalent property,measured over a period equal to the remaining non-cancelable term of the lease.The capitalized above-market or below-market lease value is amortized as areduction of, or increase to, rental income over the remaining non-cancelableterm of each lease, plus any renewal periods with fixed rental terms that areconsidered to be below-market.

The total amount of other intangible assets allocatedto in-place lease values is based on management’s evaluation of the specificcharacteristics of each lease and the Company’s overall relationship with eachtenant. Factors considered in the allocation of these values include, but arenot limited to, the nature of the existing relationship with the tenant, thetenant’s credit quality, the expectation of lease renewals, the estimatedcarrying costs of the property during a hypothetical expected lease-up period,current market conditions and costs to execute similar leases. Management willalso consider information obtained about a property in connection with itspre-acquisition due diligence. Estimated carrying costs include real estatetaxes, insurance, other property operating costs and estimates of lost rentalsat market rates during the hypothetical expected lease-up periods, based onmanagement’s assessment of specific market conditions. Management will estimatecosts required to execute leases including commissions and legal costs to theextent that such costs are not already incurred with a new lease that has beennegotiated in connection with the purchase of a property. Independentappraisals and/or management’s estimates will be used to determine thesevalues.

The value of in-place leases is amortized to expenseover the remaining initial term of each lease. The value of tenant relationshipintangibles is amortized to expense over the initial terms of the leases;however, no amortization period for intangible assets will exceed the remainingdepreciable life of the building.

In the event that a tenantterminates its lease, the unamortized portion of each intangible, includingmarket rate adjustments, lease origination costs, in-place values and tenantrelationship values, will be charged as an expense.

*Long-Lived Assets*

On a periodic basis, management assesses whether thereare any indicators that the value of its real estate properties may be impaired.A property’s value is impaired only if management’s estimate of the aggregatefuture cash flows (undiscounted and without interest charges) to be generatedby the property (taking into account the anticipated holding period of theasset) is less than the carrying value of the property. Such estimate of cashflows considers factors such as expected future operating income, trends 

F-11

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

and prospects, as well asthe effects of demand, competition and other economic factors. To the extentimpairment has occurred, the loss will be measured as the excess of thecarrying amount of the property over the fair value of the property, andreflected as an adjustment to the basis of the property.

When assets are identifiedby management as held for sale, the Company discontinues depreciating theassets and estimates the sales price, net of selling costs, of such assets. If,in management’s opinion, the net sales price of the assets that have beenidentified for sale is less than the net book value of the assets, a valuationallowance is established. For investments accounted for under the equitymethod, a loss is recognized if the loss in value of the investment is otherthan temporary.

*Employee Loans*

Prior to 2001, the Companyhad made loans to officers and employees primarily for the purpose ofpurchasing the Company’s common stock. These loans are demand and term notesbearing interest at rates ranging from 5.0% to 6.0%. Interest on such loans ispayable quarterly. Loans made for the purchase of common stock are reported asa deduction from stockholders’ equity. At December 31, 2006 and 2005, theCompany had aggregate loans to employees of approximately $0.5 million and $0.6million, respectively.

*Deferred Leasing and Loan Origination Costs*

Costs incurred inobtaining tenant leases (including internal leasing costs) are amortized usingthe straight-line method over the terms of the related leases and included indepreciation and amortization. Unamortized deferred leasing costs are chargedto amortization expense upon early termination of the lease. Costs incurred inobtaining long-term financing are amortized and charged to interest expenseover the terms of the related debt agreements, which approximates the effectiveinterest method.

*Internal Leasing Costs*

The Companycapitalizes internal leasing costs in accordance with SFAS No. 91, *Nonrefundable Fees & Costs Associated with Originating orAcquiring Loans and Initial Direct Costs of Leases.*Please refer tothe following table for additional information regarding the capitalization ofinternal leasing costs (dollars in thousands).

| Balance at  December 31, 2003 |   | $      | 7,790  |   |
|------------------------------------|--------|--------|--------|--------|
| Costs capitalized                  |   | 6,926  |   |
| Amortization/writeoffs             |   | (2,445 | )      |
| Balance at December 31, 2004  |   | 12,271 |   |
| Costs capitalized                  |   | 6,260  |   |
| Amortization/writeoffs  (1)        |   | (6,019 | )      |
| Balance at December 31, 2005  |   | 12,512 |   |
| Costs capitalized                  |   | 7,032  |   |
| Amortization/writeoffs             |   | (3,529 | )      |
| Balance at  December 31, 2006 |   | $      | 16,015 |   |

----

(1)          Includesapproximately $2.8 million of internal leasing commissions written off inconnection with the portfolio disposition discussed in Note 3.

F-12

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

*Investments in / Advances to UnconsolidatedVentures*

TheCompany has direct equity investments in several joint venture projects. TheCompany accounts for these investments in unconsolidated ventures using theequity method of accounting, as the Company exercises significant influenceover, but does not control, and is not the primary beneficiary of, theseentities. These investments are initially recorded at cost, as “Investments in/ advances to unconsolidated ventures”, and subsequently adjusted for equity inearnings and cash contributions and distributions. Intercompany fees and gainson property transactions are eliminated to the extent of the Company’sownership interest.

To the extent that the Company contributes assets to ajoint venture project, the difference between the Company’s cost basis in theassets and the basis reflected at the joint venture level is amortized over thelife of the related asset and included in the Company’s share of equity inincome of unconsolidated ventures.

*Intangible Assets*

The Company’s intangible assets, other than thoseacquired in business combinations, include property management rights and anasset management fee stream. These assets were initially measured based ontheir fair values and are being amortized on a straight-line basis over aperiod of 20 to 40 years. These assets are stated at cost, net of accumulatedamortization.

*Derivative / Financial Instruments*

The Company accounts for derivative and hedgingactivities in accordance with SFAS No. 133, *Accounting forDerivative Instruments and Hedging Activities* (“SFAS No. 133”)and SFAS No. 138, *Accounting for CertainDerivative Instruments and Certain Hedging Activities*. Theseaccounting standards require the Company to measure derivatives, includingcertain derivatives embedded in other contracts, at fair value and to recognizethem in the Consolidated Balance Sheets as assets or liabilities, depending onthe Company’s rights or obligations under the applicable derivative contract.For derivatives designated as fair value hedges, the changes in the fair valueof both the derivative instrument and the hedged item are recorded in earnings.For derivatives designated as cash flow hedges, the effective portions ofchanges in fair value of the derivative are reported in other comprehensiveincome (“OCI”) and are subsequently reclassified into earnings when the hedgeditem affects earnings. Changes in fair value of derivative instruments notdesignated as hedging instruments, and ineffective portions of hedges, are recognizedin earnings in the current period.

*Asset Retirement Obligations*

The Company accounts for its conditional assetretirement obligations in accordance with FASB Interpretation No. 47, *Accounting for Conditional Asset Retirement Obligations*(“FIN 47”), which the Company adopted as of December 31, 2005. Aconditional asset retirement obligation refers to a legal obligation (pursuantto existing law or contract) to perform an asset retirement activity in whichthe timing and/or method of settlement are conditioned upon the occurrence of afuture event that may or may not be within the control of the Company. TheCompany’s conditional asset retirement obligations arise primarily from legalrequirements to decontaminate buildings at the time the buildings are sold orotherwise disposed of. In accordance with FIN 47, the Company has reasonablyestimated the fair value of its conditional asset retirement obligations andhas recognized a liability for conditional asset retirement obligations ofapproximately $1.0 million as of December 31, 2006. During the year endedDecember 31, 

F-13

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

2006, the Company recordedapproximately $0.3 million of accretion associated with its asset retirementobligation liability.

*Self-Insured Health Plan*

Beginning in May 2003, the Company implemented aself-insured health plan for all of its employees. In order to limit itsexposure, the Company has purchased stop-loss insurance, which will reimbursethe Company for individual claims in excess of $0.1 million annually, oraggregate claims in excess of $1.0 million annually. Self-insurance losses areaccrued based on the Company’s estimates of the aggregate liability foruninsured claims incurred using certain actuarial assumptions adhered to in theinsurance industry. The liability for self-insured losses is included inaccrued expenses and was approximately $0.8 million and $0.7 million atDecember 31, 2006 and 2005, respectively.

*General Liability Insurance*

The Company has one wholly-owned captive insurancecompany, ERT CIC, LLC (“ERT CIC”), which underwrites the first layer of generalliability insurance programs for the Company’s wholly-owned, majority-owned andjoint venture properties (excluding properties owned by CA New Plan AcquisitionFund, LLC, CA New Plan Direct Investment Fund, LLC and CA New Plan VentureFund, LLC, which are covered under a separate policy). The Company carriesgeneral liability insurance on its properties in amounts that it believes(i) adequately insures all of its properties and (ii) are in linewith coverage obtained by owners of similar properties. The Company haspurchased stop-loss insurance, which will reimburse the Company for individualclaims in excess of $0.3 million annually, or aggregate claims in excess of $3.7 millionannually. If the Company experiences a loss and ERT CIC is required to payunder its insurance policy, the Company would ultimately record a loss to theextent of such required payment. Because the Company owns ERT CIC, the Companyis responsible for ERT CIC’s liquidity and capital resources, and the accountsof ERT CIC are part of the Company’s consolidated financial statements.

*Revenue Recognition*

Rental revenue is recognized on the straight-linebasis, which averages minimum rents over the terms of the leases. Thecumulative difference between lease revenue recognized under this method andcontractual lease payment terms is recorded as “deferred rent receivable” onthe accompanying Consolidated Balance Sheets. Certain leases provide forpercentage rents based upon the level of sales achieved by the lessee. Thesepercentage rents are recorded once the required sales levels are achieved. Theleases also typically provide for tenant reimbursement of common areamaintenance and other operating expenses. Rental revenue also includes leasetermination fees. Lease termination fees were approximately $6.8 million, $5.4million and $2.8 million for the years ended December 31, 2006, 2005 and2004, respectively.

*Income from Discontinued Operations*

Income from discontinued operations is computed in accordancewith SFAS No. 144, *Accounting for theImpairment or Disposal of Long-Lived Assets* (“SFAS No. 144”). SFASNo. 144 requires, among other things, that the primary assets andliabilities and the results of operations of the Company’s real property thathas been sold, or otherwise qualifies as “held for sale” (as defined by SFAS No. 144),be classified as discontinued operations and segregated in the Company’sConsolidated Statements of Income and Comprehensive Income and ConsolidatedBalance Sheets. Properties classified as real estate held for sale 

F-14

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

generally representproperties that are under contract for sale and are expected to close withinthe next twelve months.

*Income Taxes*

TheCompany has elected to be treated as a REIT under Sections 856 through 860 ofthe Internal Revenue Code of 1986, as amended (the “Code”). In order tomaintain its qualification as a REIT, the Company is required to, among otherthings, distribute at least 90% of its REIT taxable income to its stockholdersand meet certain tests regarding the nature of its income and assets. As aREIT, the Company is not subject to federal income tax with respect to theportion of its income that meets certain criteria and is distributed annuallyto the stockholders. Accordingly, no provision for federal income taxes isincluded in the accompanying consolidated financial statements. The Companyintends to continue to operate in a manner that allows it to continue to meetthe requirements for taxation as a REIT. Many of these requirements, however,are highly technical and complex. If the Company were to fail to meet theserequirements, the Company would be subject to federal income tax. The Companyis subject to certain state and local taxes. Provision for such taxes has beenincluded in general and administrative expenses in the Company’s ConsolidatedStatements of Income and Comprehensive Income.

The Company may elect to treat one or more of itssubsidiaries as a taxable REIT subsidiary (“TRS”). In general, a TRS of theCompany may perform additional services for tenants of the Company andgenerally may engage in any real estate or non-real estate related business(except for the operation or management of health care facilities or lodgingfacilities or the provision to any person, under a franchise, license orotherwise, of rights to any brand name under which any lodging facility orhealth care facility is operated). A TRS is subject to corporate federal incometax. The Company has elected to treat certain of its corporate subsidiaries asTRSs. At December 31, 2006, the Company’s TRSs had a tax net operatingloss (“NOL”) carryforward of approximately $32.4 million, expiring from2013 to 2020. In addition, the Company’s TRSs had other net tax assets, mostsignificantly relating to an asset impairment recognized in fiscal 2003, forfinancial accounting purposes that will not be recognized for tax purposesuntil the property is sold. The Company’s TRSs have ascribed a full valuationallowance to its net deferred tax assets.

*Segment Information*

The principal business of the Company is the ownershipand management of community and neighborhood shopping centers. The Company doesnot distinguish or group its operations on a geographical basis for purposes ofmeasuring performance. Accordingly, the Company believes it has a singlereportable segment for disclosure purposes in accordance with GAAP. Further,all of the Company’s operations and assets are within the United States and notenant comprises more than 4.1% of revenue. 

*Use of Estimates*

The preparation of financial statements in conformitywith GAAP requires management to make estimates and assumptions that affect thereported amounts of assets and liabilities at the date of the financialstatements and the reported amounts of revenues and expenses during the period.Actual results could differ from those estimates. The most significantassumptions and estimates relate to impairments of real estate, recovery ofmortgage notes and trade accounts receivable and depreciable lives.

*Reclassifications*

In accordance with theprovisions of SFAS No. 144, certain prior period amounts have beenreclassified to conform with the current period presentation.

F-15

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

*Recently Issued Accounting Standards*

In September 2006,the SEC issued Staff Accounting Bulletin (“SAB”) No. 108, *Considering the Effects of Prior Year Misstatements when QuantifyingMisstatements in Current Year Financial Statements* (“SAB No. 108”).SAB No. 108 provides guidance on how the effects of uncorrected prior yearmisstatements should be considered when quantifying current year misstatementsfor the purpose of a materiality assessment. The SEC staff believes registrantsmust quantify misstatements using both a balance sheet and income statementapproach and evaluate whether either approach results in quantifying amisstatement that, when all relevant quantitative and qualitative factors areconsidered, is material. SAB No. 108 is effective for the first annualperiod ending after November 15, 2006, with early application encouraged. TheCompany adopted SAB No. 108 in the quarter ended December 31, 2006. Theadoption of SAB No. 108 did not have a material impact on the consolidatedfinancial statements of the Company.

In September 2006,the FASB issued Statement No. 157, *Fair Value Measurements*(“SFAS No. 157”). SFAS No. 157 defines fair value, establishes aframework for measuring fair value in accordance with GAAP and expandsdisclosure requirements regarding fair value measurements. SFAS No. 157 iseffective for financial statements issued for fiscal years beginning after November 15,2007, and interim periods within those fiscal years. Earlier application isencouraged, provided that the reporting entity has not yet issued financialstatements for such fiscal year, including financial statements for an interimperiod within such fiscal year. The adoption of SFAS No. 157 is notexpected to have a material impact on the consolidated financial statements ofthe Company.

In June 2006,the FASB issued Interpretation No. 48, *Accounting for Uncertaintyin Income Taxes—an Interpretation of FASB Statement No. 109* (“FIN48”). FIN 48 (i) clarifies the accounting for uncertainty in income taxesrecognized in companies’ financial statements in accordance with FASB StatementNo. 109, *Accounting for Income Taxes*, (ii) prescribesa recognition threshold and measurement attribute for the financial statementrecognition and measurement of a tax position taken or expected to be taken ina tax return and (iii) provides guidance on derecognition of recognizedtax benefits, classification, interest and penalties, accounting in interimperiods, disclosure and transition. FIN 48 is effective for fiscal yearsbeginning after December 15, 2006. The Company is currently evaluating theimpact of the adoption of FIN 48 on its consolidated financial statements.

In March 2006,the FASB issued Statement No. 156, *Accounting for Servicingof Financial Assets—an amendment of FASB Statement No. 140* (“SFASNo. 156”). SFAS No. 156 (i) clarifies when an obligation toservice financial assets should be separately recognized as a servicing assetor a servicing liability, (ii) requires that a separately recognizedservicing asset or servicing liability be initially measured at fair value, ifpracticable, and (iii) permits an entity with a separately recognizedservicing asset or servicing liability to choose either the amortization methodor the fair value method for subsequent measurement. SFAS No. 156 iseffective for fiscal years beginning after September 15, 2006, but earlyadoption is permitted. The adoption of SFAS No. 156 is not expected tohave a material impact on the consolidated financial statements of the Company.

In February 2006, the FASB issued Statement No. 155,*Accounting for Certain Hybrid Financial Instruments—anamendment of FASB Statements No. 133 and 140* (“SFAS No. 155”).SFAS No. 155 (i) permits fair value remeasurement for any hybridfinancial instrument that contains an embedded derivative that otherwise wouldrequire bifurcation, (ii) clarifies which interest-only strips andprincipal-only strips are not subject to the requirements of SFAS No. 133,(iii) establishes a requirement to evaluate interests in securitizedfinancial assets to identify interests that are freestanding derivatives orthat are hybrid financial instruments that contain an embedded derivativerequiring bifurcation, (iv) clarifies that concentrations of credit riskin the form of subordination are not embedded derivatives and (v) amends 

F-16

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

FASB Statement No. 140,*Accounting for Transfers and Servicing of FinancialAssets and Extinguishment of Liabilities*, to eliminate theprohibition on a qualifying special-purpose entity from holding a derivativefinancial instrument that pertains to a beneficial interest other than anotherderivative financial instrument. SFAS No. 155 is effective for allfinancial instruments acquired or issued after the beginning of an entity’sfirst fiscal year that begins after September 15, 2006. The adoption ofSFAS No. 155 is not expected to have a material impact on the consolidatedfinancial statements of the Company.

**3. Acquisitionsand Dispositions**

*Acquisitions*

During the year ended December 31,2006, the Company acquired eight shopping centers (including two buildingsimmediately adjacent to properties owned by the Company and the remaining 90%interests in two shopping centers in which the Company owned the other 10%interests), six land parcels, and a leasehold interest in a new developmentproject. Please refer to the following table for additional details (dollars inmillions, except footnotes).

| ** **                                   | ** ** | ** **           | ** ** | ** **          | ** ** | ** **             | ** ** | **Gross**                   | ** ** | ** **                  | ** ** | **Purchase Price Components** | ** ** |
|----------------------------------------------|------------|----------------------|------------|---------------------|------------|------------------------|------------|-----------------------------|------------|-----------------------------|------------|-----------------------------------------|------------|
| **Property Name**                       | ** ** | ** **           | ** ** | **Location**        | ** ** | **Property Type** | ** ** | **Acquisition   Date** | ** ** | **Leasable  Area** (1) | ** ** | **Purchase   Price**               | ** ** | **ERP  Units** | ** ** | **Assumed  Debt** | ** ** | **Cash** | ** ** |
| Building at Tarpon Mall                      |       | Tarpon  Springs, FL  |       | Shopping  Center    |       |                   | 01/27/06   |                        |       | 6,580                       |       |                                    | $          | 2.3 |   |   |   | — |   |   |   | — |   |   | $ | 2.3 |   |
| Building at Hazel Path                       |       | Hendersonville,  TN  |       | Shopping  Center    |       |                   | 02/21/06   |                        |       | 94,977                      |       |                                    | $          | 4.8 |   |   |   | — |   |   |   | — |   |   | $ | 4.8 |   |
| Shoppes at Hickory Hollow                    |       | Antioch,  TN         |       | Shopping  Center    |       |                   | 09/21/06   |                        |       | 144,469                     |       |                                    | $          | 15.5 |   |   |   | — |   |   |   | $ | 10.8 |   |   | $ | 4.7 |   |
| The Quentin Collection                       |       | Kildeer,  IL         |       | Shopping  Center    |       |                   | 09/22/06   |                        |       | 171,179                     |       |                                    | $          | 38.2 |   |   |   | — |   |   |   | — |   |   | $ | 38.2 |   |
| the Shoppes at Cinnaminson                   |       | Cinnaminson,  NJ     |       | Land                |       |                   | 09/29/06   |                        |       | 40 acres                    |       |                                    | $          | 10.7 |   |   |   | — |   |   |   | — |   |   | $ | 10.7 |   |
| Land at Brentwood Plaza                      |       | Cincinnati,  OH      |       | Land                |       |                   | 10/19/06   |                        |       | 1.2 acres                   |       |                                    | $          | 0.7 |   |   |   | — |   |   |   | — |   |   | $ | 0.7 |   |
| Ventura Downs (2) (3)              |       | Kissimmee,  FL       |       | Shopping  Center    |       |                   | 11/01/06   |                        |       | 98,191                      |       |                                    | $          | 42.7 |   |   |   | — |   |   |   | — |   |   | $ | 27.1 |   |
| Odessa-Winwood Town Center (2) (4) |       | Odessa,  TX          |       | Shopping  Center    |       |                   | 11/01/06   |                        |       | 343,603                     |       |                                    | —     |   |   |   | — |   |   |   | $ | 15.6 |   |   | — |   |
| A&P Fresh Market                         |       | Clark,  NJ           |       | Leasehold  Interest |       |                   | 11/10/06   |                        |       | —                      |       |                                    | —     |   |   |   | — |   |   |   | — |   |   | — |   |
| Land at Culpepper Plaza                      |       | College  Station, TX |       | Land                |       |                   | 11/16/06   |                        |       | 0.6 acres                   |       |                                    | $          | 0.2 |   |   |   | — |   |   |   | — |   |   | $ | 0.2 |   |
| Fox Run Mall                                 |       | Glastonbury,  CT     |       | Shopping  Center    |       |                   | 12/01/06   |                        |       | 97,086                      |       |                                    | $          | 17.5 |   |   |   | $ | 4.8 |   |   |   | — |   |   | $ | 12.7 |   |
| Land at Rising Sun Towne Center              |       | Rising  Sun, MD      |       | Land                |       |                   | 12/05/06   |                        |       | 5.3 acres                   |       |                                    | $          | 0.7 |   |   |   | — |   |   |   | — |   |   | $ | 0.7 |   |
| Land at Victory Square                       |       | Savannah,  GA        |       | Land                |       |                   | 12/12/06   |                        |       | 9.8 acres                   |       |                                    | $          | 0.6 |   |   |   | — |   |   |   | — |   |   | $ | 0.6 |   |
| Memphis Commons                              |       | Memphis,  TN         |       | Shopping  Center    |       |                   | 12/21/06   |                        |       | 336,638                     |       |                                    | $          | 42.0 |   |   |   | — |   |   |   | $ | 17.2 |   |   | $ | 24.8 |   |
| Land at Wabash Crossing (5)             |       | Wabash,  IN          |       | Land                |       |                   | 12/22/06   |                        |       | 26.5 acres                  |       |                                    | $          | 2.6 |   |   |   | — |   |   |   | — |   |   | $ | 2.6 |   |
| ** **                                   | ** ** | **Total**            |       |                |       |                   |       |                        |       |                        |       |                                    | $          | 178.5 |   |   |   | $ | 4.8 |   |   |   | $ | 43.6 |   |   | $ | 130.1 |   |
|                                              |            |                      |            |                     |            |                        |            |                             |            |                             |            |                                         |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

----

(1)             Amounts in square feet, unless otherwisenoted. Gross leasable area is unaudited.

(2)             Property acquired as a component of amulti-property transaction. Purchase price and cash listed for Ventura Downsrepresent the combined amounts for the acquisition of Ventura Downs andOdessa-Winwood Town Center.

(3)             Property acquired from CA New Plan VentureFund, LLC, a joint venture in which the Company has a 10% interest.

(4)             Property acquired from CA New Plan VentureDirect Investment Fund, LLC, a joint venture in which the Company has a 10%interest.

(5)             Approximately 23.1 acres of the land wassimultaneously sold to Wal-Mart Stores for approximately $2.3 million.

F-17

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

Additionally, on June 20, 2006, NewSem TyroneGardens LLC, a joint venture with The Sembler Company in which the Companyholds a 90% interest, acquired Tyrone Gardens, a 209,337 square foot shoppingcenter located in St. Petersburg, Florida, for approximately $19.0 million,including approximately $9.0 million of assumed mortgage indebtedness. Inaccordance with the provisions of EITF 04-5, this property isincluded as a consolidated entity in the Company’s Consolidated FinancialStatements.

Duringthe year ended December 31, 2005, the Company acquired 12 shoppingcenters, including two vacant buildings and the remaining 90% interests in twoshopping centers in which the Company owned the other 10% interest, and sixland parcels. Please refer to the following table for additional details(dollars in millions).

| ** **                                      | ** ** | ** **           | ** ** | ** **       | ** ** | ** **         | ** ** | **Gross**                   | ** ** | ** **                  | ** ** | **Purchase Price Components** | ** ** |
|-------------------------------------------------|------------|----------------------|------------|------------------|------------|--------------------|------------|-----------------------------|------------|-----------------------------|------------|-----------------------------------------|------------|
| **Property Name**                          | ** ** | ** **           | ** ** | **Location**     | ** ** | **Property  Type** | ** ** | **Acquisition   Date** | ** ** | **Leasable  Area** (1) | ** ** | **Purchase   Price**               | ** ** | **ERP   Units** | ** ** | **Assumed  Debt** | ** ** | **Cash** | ** ** |
| Building at Midway Crossing                     |       | Elyria,  OH          |       | Shopping  Center |       |               | 01/13/05   |                        |       | 20,338                      | (2)        |                                    | $          | 1.1 |   |   | — |   |   | — |   |   | $ | 1.1 |   |
| Brunswick Town Center                           |       | Brunswick,  OH       |       | Shopping  Center |       |               | 01/21/05   |                        |       | 122,989                     |       |                                    | $          | 16.4 |   |   | — |   |   | — |   |   | $ | 16.4 |   |
| Hillcrest Shopping Center                       |       | Spartanburg, SC |       | Shopping  Center |       |               | 02/16/05   |                        |       | 343,914                     |       |                                    | $          | 35.5 |   |   | $ | 14.5 |   |   | $ | 16.8 |   |   | $ | 4.2 |   |
| West Ridge Shopping Center                      |       | Westland,  MI        |       | Shopping  Center |       |               | 03/17/05   |                        |       | 163,131                     |       |                                    | $          | 16.6 |   |   | — |   |   | $ | 11.0 |   |   | $ | 5.6 |   |
| Marketplace at Wycliffe(3)(4)(5)                |       | Lake  Worth, FL      |       | Shopping  Center |       |               | 06/01/05   |                        |       | 133,520                     |       |                                    | $          | 35.7 |   |   | — |   |   | — |   |   | $ | 35.7 |   |
| Mableton Walk(3)(4)                             |       | Mableton,  GA        |       | Shopping  Center |       |               | 06/01/05   |                        |       | 105,742                     |       |                                    | —     |   |   | — |   |   | — |   |   | — |   |
| Market Plaza                                    |       | Plano,  TX           |       | Shopping  Center |       |               | 07/13/05   |                        |       | 161,453                     |       |                                    | $          | 39.6 |   |   | — |   |   | — |   |   | $ | 39.6 |   |
| Surrey Square Mall                              |       | Norwood,  OH         |       | Shopping  Center |       |               | 08/26/05   |                        |       | 190,323                     |       |                                    | $          | 10.5 |   |   | — |   |   | — |   |   | $ | 10.5 |   |
| Five land parcels adjacent to Home Depot Stores |       | FL,  LA, OH          |       | Land             |       |               | 09/07/05   |                        |       | 40  acres                   |       |                                    | $          | 9.3 |   |   | — |   |   | — |   |   | $ | 9.3 |   |
| Fashion Place Shopping Center                   |       | Columbia,  SC        |       | Shopping  Center |       |               | 09/14/05   |                        |       | 149,493                     |       |                                    | $          | 6.8 |   |   | — |   |   | — |   |   | $ | 6.8 |   |
| Brandt Pike Place                               |       | Dayton,  OH          |       | Land             |       |               | 09/30/05   |                        |       | 11  acres                   |       |                                    | $          | 1.6 |   |   | — |   |   | — |   |   | $ | 1.6 |   |
| Building at Victory Square                      |       | Savannah,  GA        |       | Shopping  Center |       |               | 10/03/05   |                        |       | 13,000                      |       |                                    | $          | 0.8 |   |   | — |   |   | — |   |   | $ | 0.8 |   |
| Western Hills Plaza                             |       | Cincinnati,  OH      |       | Shopping  Center |       |               | 11/03/05   |                        |       | 430,399                     |       |                                    | $          | 45.6 |   |   |   |   |   | — |   |   | $ | 45.6 |   |
| Southland Shopping Center                       |       | Toledo,  OH          |       | Shopping  Center |       |               | 12/21/05   |                        |       | 291,221                     |       |                                    | $          | 14.8 |   |   | — |   |   | — |   |   | $ | 14.8 |   |
| ** **                                      | ** ** | **Total**            |       |             |       |               |       |                        |       |                        |       |                                    | $          | 234.3 |   |   | $ | 14.5 |   |   | $ | 27.8 |   |   | $ | 192.0 |   |
|                                                 |            |                      |            |                  |            |                    |            |                             |            |                             |            |                                         |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

----

(1)             Amounts in square feet, unless otherwise noted. Grossleasable area is unaudited.

(2)             Also includes 2.5 acres of land.

(3)             Property acquired as a component of a multi-propertytransaction. Purchase price and cash listed for Marketplace at Wyclifferepresent the combined amounts for the acquisition of Marketplace at Wycliffeand Mableton Walk.

(4)             Property acquired from CA New Plan Venture Fund, LLC, ajoint venture in which the Company has a 10% interest.

(5)             On August 10, 2005, this property was sold as partof the Galileo Transactions (as defined below).

F-18

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

Duringthe 2004 fiscal year, the Company acquired 13 shopping centers, including theremaining 50% interest in two shopping centers in which the Company owned theother 50%, and 11 acres of unimproved land known as Unity Plaza. Please referto the following table for additional details (dollars in millions).

| ** **                     | ** ** | ** **             | ** ** | ** **       | ** ** | ** **         | ** ** | **Gross**             | ** ** | ** **            | ** ** | **Purchase Price Components** | ** ** |
|--------------------------------|------------|------------------------|------------|------------------|------------|--------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------------------------|------------|
| **Property Name**         | ** ** | ** **             | ** ** | **Location**     | ** ** | **Property  Type** | ** ** | **Acquisition  Date** | ** ** | **Leasable  Area**(1) | ** ** | **Purchase   Price**               | ** ** | **ERP  Units** | ** ** | **Assumed  Debt** | ** ** | **Cash** | ** ** |
| New Britain Village Square     |       | Chalfont,  PA          |       | Shopping  Center |       |               | 01/09/04   |                  |       | 143,716               |       |                                    | $          | 23.4 |   |   | $ | 11.2 |   |   | $ | 12.2 | (2) |   | — |   |
| Clearwater Mall(3)             |       | Clearwater,  FL        |       | Shopping  Center |       |               | 01/30/04   |                  |       | 285,519               |       |                                    | $          | 30.0 |   |   | — |   |   | — |   |   | $ | 30.0 |   |
| Elk Grove Town Center          |       | Elk  Grove Village, IL |       | Shopping  Center |       |               | 01/30/04   |                  |       | 131,849               |       |                                    | $          | 21.0 |   |   | — |   |   | $ | 14.5 |   |   | $ | 6.5 |   |
| Villa Monaco                   |       | Denver,  CO            |       | Shopping  Center |       |               | 02/19/04   |                  |       | 122,213               |       |                                    | $          | 12.0 |   |   | — |   |   | — |   |   | $ | 12.0 |   |
| Florence Square                |       | Florence,  KY          |       | Shopping  Center |       |               | 03/17/04   |                  |       | 361,251               |       |                                    | $          | 39.5 |   |   | — |   |   | $ | 15.8 |   |   | $ | 23.7 |   |
| Unity Plaza                    |       | East  Fishkill, NY     |       | Land             |       |               | 04/28/04   |                  |       | 11 acres              |       |                                    | $          | 6.0 |   |   | — |   |   | — |   |   | $ | 6.0 |   |
| Stockbridge Village            |       | Stockbridge,  GA       |       | Shopping  Center |       |               | 04/29/04   |                  |       | 188,203               |       |                                    | $          | 23.8 |   |   | — |   |   | — |   |   | $ | 23.8 |   |
| Starlite Plaza                 |       | Sylvania,  OH          |       | Shopping  Center |       |               | 07/22/04   |                  |       | 222,450               |       |                                    | $          | 16.8 |   |   | — |   |   | — |   |   | $ | 16.8 |   |
| Village Center                 |       | Smithtown,  NY         |       | Shopping  Center |       |               | 08/19/04   |                  |       | 97,401                |       |                                    | $          | 16.8 |   |   | — |   |   | $ | 4.4 |   |   | $ | 12.4 |   |
| Annex of Arlington             |       | Arlington  Heights, IL |       | Shopping  Center |       |               | 08/26/04   |                  |       | 197,328               |       |                                    | $          | 27.2 |   |   | — |   |   | $ | 17.9 |   |   | $ | 9.3 |   |
| Marketplace                    |       | Tulsa,  OK             |       | Shopping  Center |       |               | 09/01/04   |                  |       | 186,851               |       |                                    | $          | 18.0 |   |   | $ | 8.8 |   |   | $ | 9.2 |   |   | — |   |
| The Market at Preston Ridge(3) |       | Frisco,  TX            |       | Shopping  Center |       |               | 09/01/04   |                  |       | 50,326                |       |                                    | $          | 5.2 |   |   | — |   |   | — |   |   | $ | 5.2 |   |
| Silver Pointe                  |       | Fenton,  MI            |       | Shopping  Center |       |               | 11/23/04   |                  |       | 86,141                |       |                                    | $          | 10.2 |   |   | — |   |   | $ | 7.2 |   |   | $ | 3.0 |   |
| The Shoppes at Southside       |       | Jacksonville,  FL      |       | Shopping  Center |       |               | 12/10/04   |                  |       | 109,113               |       |                                    | $          | 25.0 |   |   | — |   |   | — |   |   | $ | 25.0 |   |
|                           | ** ** | **Total**              |       |             |       |               |       |                  |       |                  |       |                                    | $          | 274.9 |   |   | $ | 20.0 |   |   | $ | 81.2 |   |   | $ | 173.7 |   |
|                                |            |                        |            |                  |            |                    |            |                       |            |                       |            |                                         |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

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(1)             Amounts in square feet, unless otherwise noted. Grossleasable area is unaudited.

(2)             Represents the assumption of a mortgage loan previouslymade by the Company to the seller.

(3)             Acquired remaining 50% interest inproperty.

*Dispositions*

*PortfolioDisposition*

On August 10, 2005, the Company sold an aggregateof 69 community and neighborhood shopping centers (the “Galileo Properties”) toGalileo America LLC for approximately $968.0 million of total consideration,comprised of approximately $928.2 million in cash and approximately $39.8million of equity in Galileo America LLC (the “Property Transfer”).

The following related transactions occurredsimultaneously with the closing of the Property Transfer, resulting in theCompany owning an approximate 5% equity interest in Galileo America LLC, whichincluded (i) the redemption by Galileo America LLC of an existing interestin Galileo America LLC held by an affiliate of CBL & AssociatesProperties, Inc. (“CBL”) for two properties previously owned by GalileoAmerica LLC, (ii) the purchase by the Company of an asset management feestream from Galileo America LLC for $18.5 million and (iii) theacquisition by the Company of the property management rights of CBL withrespect to Galileo America LLC for $22.0 million (plus an agreement to purchaseadditional property management rights in 2008 for $7.0 million) (suchtransactions are referred to collectively with the Property Transfer as the “GalileoTransactions”).

As a result of the Company’sretained 5% ownership interest in Galileo America LLC, as well as the Company’spurchase of the property and asset management rights as part of the GalileoTransactions, the results of operations of the Galileo Properties up to August 10,2005 were not classified as income from discontinued operations and areincluded in income from continuing operations.

F-19

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

*Other Dispositions*

During 2006, the Company sold 29 properties and sixland parcels for aggregate gross proceeds of approximately $124.0 million. Inconnection with the sale of these properties, and in accordance with SFAS No. 144(Note 2), the Company recorded the results of operations and the related gainon sale as income from discontinued operations (Note 5).

During 2005, in addition to the Galileo Transactions,the Company sold 12 properties, four land parcels, 90% of its ownership interestin The Pines and 90% of its ownership interest in Northshore West for aggregategross proceeds of approximately $105.6 million. In connection with the sale ofthese properties, and in accordance with SFAS No. 144 (Note 2), theCompany recorded the results of operations and the related gain/loss on sale asincome from discontinued operations (Note 5). The results of operations fromThe Pines and Northshore West are not considered to be income from discontinuedoperations due to the Company’s continued involvement in its operations as aresult of the Company’s 10% joint venture interest.

During 2004, the Companysold 14 properties, two outparcels, one land parcel and 90% of its ownershipinterest in Villa Monaco for aggregate gross proceeds of approximately $57.9million, including approximately $8.5 million represented by a purchase moneynote issued in connection with the sale of Factory Merchants Barstow (thepurchase money note was repaid in full in early 2005). In connection with thesale of these properties, and in accordance with SFAS No. 144, the Companyrecorded the results of operations and the related gain on sale as income fromdiscontinued operations (Note 5).

**4.**RealEstate Held for Sale and Impaired Real Estate

As of December 31, 2006, three retail propertiesand three land parcels were classified as “Real estate held for sale.”  These properties are located in four statesand have an aggregate gross leasable area of approximately 0.2 million squarefeet. Such properties had an aggregate book value of approximately $28.6million, net of accumulated depreciation of approximately $0.7 million as of December 31,2006. In accordance with SFAS No. 144 (Note 2), the Company has recordedthe results of operations and the related impairment of any operatingproperties, excluding land parcels, classified as held for sale as income fromdiscontinued operations (Note 5).

As of December 31, 2005, five retail propertiesand three land parcels were classified as “Real estate held for sale.”  These properties are located in five statesand have an aggregate gross leasable area of approximately 0.5 million squarefeet. Such properties had an aggregate book value of approximately $19.2million, net of accumulated depreciation of approximately $3.6 million as of December 31,2005. In accordance with SFAS No. 144 (Note 2), the Company has recordedthe results of operations and the related impairment of any operatingproperties, excluding land parcels, classified as held for sale as income fromdiscontinued operations (Note 5).

F-20

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

**5. Income fromDiscontinued Operations**

Thefollowing is a summary of income from discontinued operations for the yearsended December 31, 2006, 2005 and 2004 (dollars in thousands):

| ** **                                                                        | ** ** | **Year Ended December 31,** | ** ** |
|-----------------------------------------------------------------------------------|------------|--------------------------------------------|------------|
| ** **                                                                        | ** ** | **2006**                                   | ** ** | **2005** | ** ** | **2004** | ** ** |
| Total revenue                                                                     |       |                                       |       |   |   |   |   |
| Other discontinued operations                                                     |       | $                                          | 13,716     |   | $ | 26,170 |   | $ | 36,101 |   |
| Real estate held for sale                                                         |       | 3,597                                      |       | 1,583 |   | 906 |   |
| Total revenue                                                                     |       | 17,313                                     |       | 27,753 |   | 37,007 |   |
| Operating costs                                                                   |       |                                       |       |   |   |   |   |
| Other discontinued operations                                                     |       | (2,668                                     | )          | (6,220 | ) | (9,203 | ) |
| Real estate held for sale                                                         |       | (547                                       | )          | (189 | ) | (129 | ) |
| Real estate taxes                                                                 |       |                                       |       |   |   |   |   |
| Other discontinued operations                                                     |       | (1,666                                     | )          | (2,997 | ) | (4,155 | ) |
| Real estate held for sale                                                         |       | (290                                       | )          | (171 | ) | (148 | ) |
| Interest expense                                                                  |       |                                       |       |   |   |   |   |
| Other discontinued operations                                                     |       | —                                     |       | (5 | ) | (183 | ) |
| Real estate held for sale                                                         |       | —                                     |       | — |   | — |   |
| Depreciation and  amortization                                                    |       |                                       |       |   |   |   |   |
| Other discontinued operations                                                     |       | (2,793                                     | )          | (5,092 | ) | (5,680 | ) |
| Real estate held for sale                                                         |       | (361                                       | )          | (72 | ) | (101 | ) |
| Provision for  doubtful accounts                                                  |       |                                       |       |   |   |   |   |
| Other discontinued operations                                                     |       | (936                                       | )          | (652 | ) | (1,902 | ) |
| Real estate held for sale                                                         |       | (27                                        | )          | 1 |   | (1 | ) |
| General and  administrative expenses                                              |       |                                       |       |   |   |   |   |
| Other discontinued operations                                                     |       | —                                     |       | (3 | ) | (29 | ) |
| Real estate held for sale                                                         |       | —                                     |       | — |   | — |   |
| Total operating costs                                                             |       | (9,288                                     | )          | (15,400 | ) | (21,531 | ) |
| Income from discontinued operations before  impairment and gain on sale |       | 8,025                                      |       | 12,353 |   | 15,476 |   |
| Impairment of real estate                                                         |       | (907                                       | )          | — |   | (88 | ) |
| Gain (loss) on sale of other discontinued operations  (1)                         |       | 14,648                                     |       | 17,787 |   | (1,139 | ) |
| Income from  discontinued operations                                              |       | $                                          | 21,766     |   | $ | 30,140 |   | $ | 14,249 |   |

----

(1)          Forthe year ended December 31, 2005, balance includes approximately $4.1million attributable to the gain on sale of the Company’s ownership interest inBPR West, L.P., a joint venture in which the Company previously held a 50%interest. Balance also includes approximately $3.4 million attributable to theconsolidated gain on sale of Rodney Village, a property formerly owned byBenbrooke Ventures, a joint venture in which the Company previously held a 50%interest.

F-21

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

**6.**MarketableSecurities

TheCompany has classified all investments in equity securities asavailable-for-sale. All investments are recorded at current market value withan offsetting adjustment to stockholders’ equity (dollars in thousands):

| ** **                | ** ** | **December 31, 2006** | ** ** | **December 31, 2005** | ** ** |
|---------------------------|------------|---------------------------------|------------|---------------------------------|------------|
| Cost basis                |       |                            | $          | 3,552                           |       |   |   | $ | 973 |   |   |
| Unrealized  holding gains |       |                            | 2,295      |                            |       |   | 2,041 |   |   |
| Fair value                |       |                            | $          | 5,847                           |       |   |   | $ | 3,014 |   |   |

 

The weighted averagemethod is used to determine realized gain or loss on securities sold. The fairvalue of marketable securities is based upon quoted market prices as of December 31,2006 and 2005.

**7.**Mortgagesand Notes Receivable

TheCompany had the following mortgages and notes receivable (dollars inthousands):

| ** **                                                          | ** ** | **December 31, 2006** | ** ** | **December 31, 2005** | ** ** |
|---------------------------------------------------------------------|------------|---------------------------------|------------|---------------------------------|------------|
| Leasehold  mortgages, interest at 10% to 12%, due 2008 to 2010 |       |                            | $          | 667                             |       |   |   | $ | 795 |   |   |
| Promissory notes,  interest at 5% to 8%, due 2007                   |       |                            | 3,745      |                            |       |   | — |   |   |
| Total                                                               |       |                            | $          | 4,412                           |       |   |   | $ | 795 |   |   |

 

At December 31, 2006and 2005, approximately $1.3 million and $1.1 million, respectively, of theother receivables on the accompanying consolidated balance sheet representedinterest and dividends receivable.

F-22

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

**8. Investmentsin/Advances to Unconsolidated Ventures**

Thefollowing table summarizes the Company’s investments in unconsolidated jointventures as of December 31, 2006 and 2005 (dollars in thousands).  The Company accounts for these investmentsusing the equity method.

|                                                         | ** ** | ** **     | ** ** | ** ** | ** ** | ** **                               | ** ** | **Company**            | ** ** |
|---------------------------------------------------------|------------|----------------|------------|------------|------------|------------------------------------------|------------|------------------------|------------|
| ** **                                              | ** ** | ** **     | ** ** | ** ** | ** ** | ** **                               | ** ** | ** **             | ** ** | **Investments in/  Advances to  Unconsolidated  Ventures  December 31,** | ** ** |
| ** **                                              | ** ** | **City**       | ** ** | **State**  | ** ** | **JV Partner**                      | ** ** | **Percent  Ownership** | ** ** | **2006** | ** ** | **2005** | ** ** |
| Arapahoe Crossings, L.P.  (1)                           |       | Aurora         |       | CO         |       | Foreign  Investor                        |       |                   | 30%        |   |   | $ | 6,477 |   | $ | 6,663 |   |
| BPR Land Partnership, L.P. (2)                     |       | Frisco         |       | TX         |       | George  Allen/Milton Schaffer            |       |                   | 50%        |   |   | $ | 1,039 |   | $ | 1,221 |   |
| BPR Shopping Center,  L.P. (1)                     |       | Frisco         |       | TX         |       | Foreign  Investor/George Allen/Milton    |       |                   | 25%        |   |   | $ | 2,808 |   | $ | 3,615 |   |
|                                                         |       |           |       |       |       | Schaffer                                 |       |                   |       |   |   |   |   |   |   |
| BPR South, L.P. (2)                                     |       | Frisco         |       | TX         |       | George  Allen/Milton Schaffer            |       |                   | 50%        |   |   | $ | 871 |   | $ | 822 |   |
| CA New Plan Acquisition  Fund, LLC (3)                  |       | Various        |       | Various    |       | Major  U.S. Pension Fund                 |       |                   | 10%        |   |   | $ | 2,408 |   | $ | 1,409 |   |
| CA New Plan Venture Direct Investment Fund, LLC         |       | Various        |       | Various    |       | Major  U.S. Pension Fund                 |       |                   | 10%        |   |   | $ | 744 |   | $ | 849 |   |
| CA New Plan Venture Fund,  LLC (4)                      |       | Various        |       | Various    |       | Major  U.S. Pension Fund                 |       |                   | 10%        |   |   | $ | 3,258 |   | $ | 3,692 |   |
| Galileo America LLC                                     |       | Various        |       | Various    |       | Galileo  Shopping America Trust          |       |                   | 5%         |   |   | $ | 34,843 |   | $ | 33,762 |   |
| NP/I&G Institutional  Retail Company, LLC (5)       |       | Various        |       | Various    |       | JPMorgan  Investment Management Inc.     |       |                   | 20%        |   |   | $ | 29,174 |   | $ | 41,447 |   |
| NP/I&G Institutional Retail Company II, LLC (6)     |       | Raleigh        |       | NC         |       | JPMorgan  Investment Management Inc.     |       |                   | 20%        |   |   | $ | 1,808 |   | — |   |
| NPK Redevelopment I,  LLC (7) (8)             |       | Various        |       | Various    |       | Kmart  Corporation (Sears Holding Corp.) |       |                   | 20%        |   |   | $ | 3,557 |   | $ | 1,000 |   |
| NP/SSP Baybrook, LLC (6)                                |       | Webster        |       | TX         |       | JPMorgan  Investment Management Inc.     |       |                   | 20%        |   |   | $ | 2,892 |   | — |   |
| Westgate Mall, LLC (9)                                  |       | Fairview  Park |       | OH         |       | Transwestern  Investment Company/        |       |                   | 10%        |   |   | $ | 1,522 |   | $ | 1,058 |   |
|                                                         |       |           |       |       |       | The  Richard E. Jacobs Group             |       |                   |       |   |   |   |   |   |   |
| **Investments  in/Advances to Unconsolidated Ventures** |       |           |       |       |       | $                                        | 91,401     |                   | $          | 95,538 |   |

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(1)             The Company receives increasedparticipation after a 10% return.

(2)             The Company receives a 10% return on itsinvestment.

(3)             The Company receives increasingparticipation after a 10% IRR.

(4)             The Company receives increasingparticipation after a 12% IRR.

(5)             TheCompanyreceivesincreasedparticipation after a 12% IRR.

(6)             The Company receives increasedparticipation after a 10% IRR.

(7)             The Company has committed to contribute atotal of $6.0 million to this joint venture. Percent ownership represents the

Company’s ownership interest subsequent to suchcontribution.

(8)             The Company receives increasingparticipation after a 10% return.

(9)             The Company receives increasingparticipation after a 13% IRR.

F-23

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

Combinedsummary financial information for the Company’s investments in/advances tounconsolidated ventures was as follows (dollars in thousands, exceptfootnotes):

| ** **                                                           | ** ** | **December 31, 2006** | ** ** | **December 31, 2005** | ** ** |
|----------------------------------------------------------------------|------------|---------------------------------|------------|---------------------------------|------------|
| **Condensed Combined Balance  Sheets**                               |       |                            |       |                            |       |   |   |   |   |
| ***Assets:***                                                        |       |                            |       |                            |       |   |   |   |   |
| Real estate  assets                                                  |       |                            | $          | 3,030,086                       |       |   |   | $ | 2,687,346 |   |   |
| Accumulated  depreciation                                            |       |                            | (156,235   | )                               |       |   | (79,158 | ) |   |
| **Net real estate**                                                  |       |                            | 2,873,851  |                            |       |   | 2,608,188 |   |   |
| Trade receivable,  net of allowance for doubtful accounts            |       |                            | 27,536     |                            |       |   | 15,909 |   |   |
| Other assets, net  of accumulated amortization                       |       |                            | 206,717    |                            |       |   | 198,779 |   |   |
| **Total Assets**                                                     |       |                            | $          | 3,108,104                       |       |   |   | $ | 2,822,876 |   |   |
| ***Liabilities:***                                                   |       |                            |       |                            |       |   |   |   |   |
| Mortgages  payable, net of unamortized premium                       |       |                            | $          | 1,930,025                       |       |   |   | $ | 1,704,473 |   |   |
| Credit facilities                                                    |       |                            | —     |                            |       |   | 38,993 |   |   |
| Amounts payable  to New Plan                                         |       |                            | 6,314      |                            |       |   | 6,605 |   |   |
| Other liabilities                                                    |       |                            | 129,672    |                            |       |   | 119,723 |   |   |
| **Total liabilities**                                                |       |                            | 2,066,011  |                            |       |   | 1,869,794 |   |   |
| Total partners’  capital                                        |       |                            | 1,042,093  |                            |       |   | 953,082 |   |   |
| **Total liabilities and partners’ capital**                     |       |                            | $          | 3,108,104                       |       |   |   | $ | 2,822,876 |   |   |
| Company’s investments in  / advances to unconsolidated ventures |       |                            | $          | 91,401                          |       |   |   | $ | 95,538 |   |   |

 

| ****                                         | ** ** | **Year Ended  December 31, 2006** | ** ** | **Year Ended  December 31, 2005** | ** ** | **Year Ended  December 31, 2004** | ** ** |
|----------------------------------------------|------------|--------------------------------------------------|------------|--------------------------------------------------|------------|--------------------------------------------------|------------|
| **Condensed  Combined Statements of Income** |       |                                             |       |                                             |       |                                             |       |   |   |   |   |   |   |
| Rental revenues                              |       |                                             | $          | 328,346                                          |       |                                             |       | $ | 218,688 |   |   |   | $ | 59,515 |   |   |
| Operating  expenses                          |       |                                             | (95,313    | )                                                |       |                                             | (63,163    | ) |   |   | (18,891 | ) |   |
| Interest expense                             |       |                                             | (100,838   | )                                                |       |                                             | (60,318    | ) |   |   | (16,998 | ) |   |
| Depreciation and  amortization               |       |                                             | (104,197   | )                                                |       |                                             | (39,574    | ) |   |   | (12,590 | ) |   |
| Other income  (expense), net                 |       |                                             | 418        |                                             |       |                                             | (23,706    | ) |   |   | 557 |   |   |
| Gain (loss) on  sale of real estate, net     |       |                                             | 18,800     |                                             |       |                                             | 17,005     |   |   |   | (85 | ) |   |
| Income from  discontinued operations         |       |                                             | 189        |                                             |       |                                             | —     |   |   |   | — |   |   |
| Net income                                   |       |                                             | $          | 47,405                                           |       |                                             |       | $ | 48,932 |   |   |   | $ | 11,508 |   |   |
| Company’s share of net  income          |       |                                             | $          | 5,143                                            |       |                                             |       | $ | 4,045 |   |   |   | $ | 1,513 |   |   |

 

F-24

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)**

The following is abrief summary of the unconsolidated joint venture obligations of the Company asof December 31, 2006.

·       *Arapahoe Crossings, L.P.*The Company, together with a U.S.partnership comprised substantially of foreign investors, has an interest in ajoint venture which owns Arapahoe Crossings, a community shopping centerlocated in Aurora, Colorado. Under the terms of this joint venture, the Companyhas a 30% interest and is responsible for contributing its pro rata share ofany capital that might be required by the joint venture; however, the Companydoes not expect that any significant capital contributions will be required. Thejoint venture had loans outstanding of approximately $47.8 million as of December 31,2006.

·       *BPR Land Partnership, L.P.* The Company has a 50% interest ina joint venture that owns approximately 27.1 acres of undeveloped land inFrisco, Texas. Under the terms of this joint venture, the Company has agreed tocontribute its pro rata share of any capital that might be required by thejoint venture; however, the Company does not expect that any significantcapital contributions will be required. The joint venture had no loansoutstanding as of December 31, 2006.

·       *BPR Shopping Center, L.P.*The Company has a 25% interest ina joint venture that owns The Centre at Preston Ridge, a community shoppingcenter located in Frisco, Texas. Under the terms of this joint venture, theCompany has agreed to contribute its pro rata share of any capital that mightbe required by the joint venture; however, the Company does not expect that anysignificant capital contributions will be required. The joint venture had loansoutstanding of approximately $67.8 million as of December 31, 2006.

·       *BPR South, L.P.*The Company has a 50% interest in a jointventure that owns approximately 8.4 acres of undeveloped land in Frisco, Texas.Under the terms of this joint venture, the Company has agreed to contribute itspro rata share of any capital that might be required by the joint venture;however, the Company does not expect that any significant capital contributionswill be required. The joint venture had no loans outstanding as of December 31,2006.

·       *CA New Plan Acquisition Fund, LLC.*The Company has a 10%interest in a joint venture that was created in conjunction with therestructuring of CA New Plan Venture Fund, LLC (see below). Under the terms ofthis joint venture, the Company has committed to contribute its pro rata shareof capital required by the joint venture for asset acquisitions, up to a maximumamount of $4.2 million, of which approximately $2.4 million had beencontributed by the Company as of December 31, 2006. The Companyanticipates contributing the remaining approximate $1.8 million by the end of2007. Additionally, the Company has agreed to contribute its pro rata share ofany additional capital that might be required by the joint venture; however,the Company does not expect that any significant additional capitalcontributions will be required. As of December 31, 2006, the joint ventureowned seven stabilized retail properties and one retail property underredevelopment. The joint venture had loans outstanding of approximately $67.9million as of December 31, 2006.

·       *CA New Plan Venture Direct Investment Fund, LLC*. The Companyhas a 10% interest in a joint venture that was created in conjunction with therestructuring of CA New Plan Venture Fund, LLC (see below). Under the terms ofthis joint venture, the Company has committed to contribute its pro rata shareof capital required by the joint venture for certain redevelopment activities,up to a maximum amount of $0.4 million, and has agreed to contribute its prorata share of any additional 

F-25

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)**

capital that might berequired by the joint venture. As of December 31, 2006, the Company hadnot made any such required capital contributions, and does not expect that anysignificant additional capital contributions will be required. The jointventure owned five stabilized retail properties and one retail property underredevelopment as of December 31, 2006. The joint venture had loansoutstanding of approximately $45.0 million as of December 31, 2006.

·       *CA New Plan Venture Fund, LLC*. During 2005, this jointventure was restructured to create two additional joint ventures, CA New PlanAcquisition Fund, LLC, and CA New Plan Venture Direct Investment Fund, LLC. Asa result of the restructuring, six stabilized assets were transferred from CANew Plan Venture Fund, LLC to CA New Plan Venture Direct Investment Fund, LLC,and two assets were sold. As of December 31, 2006, the joint venture ownedfour stabilized retail properties and one retail property under redevelopment. Underthe terms of the restructured joint venture, the Company continues to have a10% interest in the venture, and has committed to contribute its pro rata shareof capital required by the joint venture for certain redevelopment activities,up to a maximum amount of $0.9 million, and has agreed to contribute its prorata share of any additional capital that might be required by the joint venture.As of December 31, 2006, the Company had not made any such requiredcapital contributions, and does not expect that any significant additionalcapital contributions will be required. The joint venture had loans outstandingof approximately $47.3 million as of December 31, 2006.

·       *Galileo America LLC*. The Company has a 5% interest in thisjoint venture, which interest was acquired in conjunction with the GalileoTransactions (Note 3). Under the terms of this joint venture, the Company isnot obligated to contribute any additional capital to the joint venture;however, in the event that additional capital is contributed by the other jointventure partner, the Company has the option to contribute the amount necessaryto maintain its 5% ownership interest. The Company anticipates makingadditional capital contributions from time to time to maintain its 5% ownershipinterest. As of December 31, 2006, this joint venture was comprised of 132stabilized retail properties, two retail properties under redevelopment and onenew development property, and had loans outstanding of approximately $1.3billion.

·       *NP/I&G Institutional Retail Company, LLC*. The Companyhas a strategic joint venture with JPMorgan Investment Management Inc. toacquire high-quality institutional grade community and neighborhood shoppingcenters on a nationwide basis. The joint venture owned 13 stabilized retailproperties as of December 31, 2006. Under the terms of this joint venture,the Company has a 20% interest in the venture and is responsible forcontributing its pro rata share of any capital that might be required by thejoint venture. The Company initially committed to contribute up to a maximumamount of $30.0 million to the joint venture, however, in connection with theacquisition of certain assets during 2005, the Company together with ERP,contributed a disproportionate share of capital to the venture, such that theCompany’s total capital investment as of December 31, 2005 was $41.4million. The excess contribution was returned to the Company in February 2006.During the year ended December 31, 2006, in connection with theacquisition of certain other assets, the Company increased its committedcapital to the venture to $31.9 million, of which approximately $29.2 millionhad been contributed as of December 31, 2006. The Company does not expectthat any significant additional capital contributions will be required, nordoes it expect that any additional acquisitions of property will be made by thejoint venture. The joint venture had loans outstanding of approximately $281.4million as of December 31, 2006.

F-26

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)**

·       *NP/I&G Institutional Retail Company II, LLC*. In February 2006,the Company formed a second strategic joint venture with JP Morgan InvestmentManagement Inc. to acquire high-quality institutional grade community andneighborhood shopping centers on a nationwide basis. Under the terms of thisjoint venture, the Company has a 20% interest in the venture and has committedto contribute its pro rata share of any capital required by the venture forasset acquisitions. As of December 31, 2006, the Company had contributedapproximately $1.8 million of such amount. Additionally, the Company has agreedto contribute its pro rata share of any additional capital that might berequired by the joint venture; however, the Company does not expect that anysignificant additional capital contributions with respect to existingproperties will be required. As of December 31, 2006, the joint ventureowned one stabilized retail property. The joint venture had loans outstandingof approximately $21.0 million as of December 31, 2006.

·       *NPK Redevelopment I, LLC*. The Company has a joint venturewith Kmart Corporation (Sears Holding Corp.) pursuant to which the jointventure will redevelop three Kmart Supercenter properties formerly owned byKmart. Under the terms of this joint venture, the Company has committed tocontribute $6.0 million, $3.6 million of which had been contributed by theCompany as of December 31, 2006. After the contribution of the totalcommitted amount, the Company will have a 20% interest in the venture and willbe responsible for contributing its pro rata share of any additional capitalthat might be required by the joint venture; however, the Company does notexpect that any significant additional capital contributions will be required. Thejoint venture had no loans outstanding as of December 31, 2006.

·       *NP/SSP Baybrook, LLC*. In December 2006, the Companyformed a third strategic joint venture with JP Morgan Investment ManagementInc. for the specific purpose of acquiring Baybrook Gateway, a shopping centerlocated in Webster, Texas. Under the terms of this joint venture, the Companyhas a 20% interest in the venture and is responsible for contributing its prorata share of any capital that might be required by the joint venture; however,the Company does not expect that any significant additional capitalcontributions will be required. The joint venture had loans outstanding ofapproximately $41.0 million as of December 31, 2006.

·       *Westgate Mall,LLC*. The Company, together with Transwestern Investment Company andThe Richard E. Jacobs Group, has an interest in a joint venture that was formedfor the specific purpose of acquiring and redeveloping Westgate Mall, anenclosed mall located on 55 acres of land in Fairview Park, Ohio. The jointventure is currently redeveloping the mall into a large community shoppingcenter. Under the terms of this joint venture, the Company has a 10% interestin the venture and is responsible for contributing its pro rata share of anycapital that might be required by the joint venture; however, the Company doesnot expect that any significant additional capital contributions will berequired. The joint venture had loans outstanding of approximately $27.7million as of December 31, 2006.

F-27

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)**

**9. IntangibleAssets**

Intangibleassets are comprised of the following (dollars in thousands):

| ** **                                                     | ** ** | **December 31,   2006** | ** ** | **December 31,   2005** | ** ** | **Amortization   Period** | ** ** |
|----------------------------------------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|--------------------------------|------------|
| In-place lease  value, legal fees and leasing commissions, net |       |                              | $          | 44,860                            |       |                           |       | $ | 34,454 |   |   | Life of lease |   |
| Above market  leases acquired, net                             |       |                              | 4,877      |                              |       |                           | 3,498      |   |   | Life of lease |   |
| Amounts paid for  asset management fee stream, net             |       |                              | 17,845     |                              |       |                           | 18,307     |   |   | 40 years |   |
| Amounts paid for  property management rights, net              |       |                              | 20,674     |                              |       |                           | 21,787     |   |   | 20 years |   |
| Total                                                          |       |                              | $          | 88,256                            |       |                           |       | $ | 78,046 |   |   |   |   |

 

Aggregateamortization expense on these assets for the years ended December 31, 2006and 2005 was approximately $9.5 million and $6.8 million, respectively, andincluded write-offs of approximately $0.6 million and $0.2 million,respectively. The estimated amortization expense on these assets during thenext five fiscal years is as follows (dollars in thousands):

| **Year** | ** ** | ** ** | ** ** | ** ** | ** ** |
|----------|------------|------------|------------|------------|------------|
| 2007     |       | $          | 10,281     |       |
| 2008     |       | 8,353      |       |
| 2009     |       | 7,467      |       |
| 2010     |       | 6,524      |       |
| 2011     |       | 4,378      |       |
|          |            |            |            |            |            |  |

 

F-28

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)**

**10. Debt Obligations**

As of December 31,2006 and 2005, the Company had the following debt obligations under variousarrangements with financial institutions (dollars in thousands):

| ** **                              | ** ** | **Maximum**           | ** ** | **Carrying Value as of** | ** ** | **Stated**                  | ** ** | **Scheduled**       | ** ** |
|-----------------------------------------|------------|-----------------------|------------|-----------------------------------------|------------|-----------------------------|------------|---------------------|------------|
| ** **                              | ** ** | **Amount  Available** | ** ** | **December 31,  2006**             | ** ** | **December 31,  2005** | ** ** | **Interest  Rates** | ** ** | **Maturity  Date** | ** ** |
| CREDIT  AGREEMENTS                      |       |                  |       |                                    |       |                        |       |                |       |   |   |   |   |   |   |   |   |
| Revolving  Facility (1)                 |       |                  | N/A        |                                    |       |                        | N/A        |                |       |   | $ | 65,000 |   |   | N/A |   | N/A |   |
| Secured  Term Loan (1)                  |       |                  | N/A        |                                    |       |                        | N/A        |                |       |   | 150,000 |   |   | N/A |   | N/A |   |
| Amended  Revolving Facility             |       |                  | $          | 350,000                                 |       |                        |       | $                   | 41,000     |   |   |   | N/A |   |   | LIBOR + 55 bp (2)(3) |   | August 2010 |   |
| Amended  Secured Term Loan              |       |                  | 150,000    |                                    |       |                        | 150,000    |                |       |   | N/A |   |   | LIBOR  + 55 bp (2) |   | August 2010 |   |
| Total  Credit Agreements                |       |                  | $          | 500,000                                 |       |                        |       | $                   | 191,000    |   |   |   | $ | 215,000 |   |   |   |   |   |   |
| MORTGAGES  PAYABLE                      |       |                  |       |                                    |       |                        |       |                |       |   |   |   |   |   |   |   |   |
| Fixed  Rate Mortgages                   |       |                  |       |                                    |       |                        | $          | 428,045             |       |   |   | $ | 395,486 |   |   | 5.240%  – 9.625% |   | 2006  – 2021 |   |
| Variable  Rate Mortgages                |       |                  |       |                                    |       |                        | 9,302      |                |       |   | 24,296 |   |   | Variable (4) |   | 2006  – 2011 |   |
| Total  Mortgages                        |       |                  |       |                                    |       |                        | $          | 437,347             |       |   |   | 419,782 |   |   |   |   |   |   |
| Net  unamortized premium                |       |                  |       |                                    |       |                        | 11,563     |                |       |   | 13,871 |   |   |   |   |   |   |
| Total  Mortgages, net                   |       |                  |       |                                    |       |                        | $          | 448,910             |       |   |   | $ | 433,653 |   |   |   |   |   |   |
| NOTES  PAYABLE                          |       |                  |       |                                    |       |                        |       |                |       |   |   |   |   |   |   |   |   |
| 7.35%  unsecured notes                  |       |                  |       |                                    |       |                        | 30,000     |                |       |   | 30,000 |   |   | 7.350% |   | June 2007 |   |
| 7.40%  unsecured notes                  |       |                  |       |                                    |       |                        | 150,000    |                |       |   | 150,000 |   |   | 7.400% |   | September 2009 |   |
| 3.75%  unsecured notes (5)              |       |                  |       |                                    |       |                        | 115,000    |                |       |   | 115,000 |   |   | 3.750% |   | June 2010 |   |
| 4.50%  unsecured notes (6)              |       |                  |       |                                    |       |                        | 150,000    |                |       |   | 150,000 |   |   | 4.500% |   | February 2011 |   |
| 3.70%  unsecured notes (7)              |       |                  |       |                                    |       |                        | 200,000    |                |       |   | — |   |   | 3.700% |   | September 2011 |   |
| 5.13%  unsecured notes                  |       |                  |       |                                    |       |                        | 125,000    |                |       |   | 125,000 |   |   | 5.125% |   | September 2012 |   |
| 5.50%  unsecured notes                  |       |                  |       |                                    |       |                        | 50,000     |                |       |   | 50,000 |   |   | 5.500% |   | November 2013 |   |
| 5.30%  unsecured notes                  |       |                  |       |                                    |       |                        | 100,000    |                |       |   | 100,000 |   |   | 5.300% |   | January 2015 |   |
| 5.25%  unsecured notes                  |       |                  |       |                                    |       |                        | 125,000    |                |       |   | 125,000 |   |   | 5.250% |   | September 2015 |   |
| 7.97%  unsecured notes                  |       |                  |       |                                    |       |                        | 10,000     |                |       |   | 10,000 |   |   | 7.970% |   | August 2026 |   |
| 7.65%  unsecured notes                  |       |                  |       |                                    |       |                        | 25,000     |                |       |   | 25,000 |   |   | 7.650% |   | November 2026 |   |
| 7.68%  unsecured notes                  |       |                  |       |                                    |       |                        | 10,000     |                |       |   | 10,000 |   |   | 7.680% |   | November 2026 |   |
| 7.68%  unsecured notes                  |       |                  |       |                                    |       |                        | 10,000     |                |       |   | 10,000 |   |   | 7.680% |   | November 2026 |   |
| 6.90%  unsecured notes                  |       |                  |       |                                    |       |                        | 25,000     |                |       |   | 25,000 |   |   | 6.900% |   | February 2028 |   |
| 6.90%  unsecured notes                  |       |                  |       |                                    |       |                        | 25,000     |                |       |   | 25,000 |   |   | 6.900% |   | February 2028 |   |
| 7.50%  unsecured notes                  |       |                  |       |                                    |       |                        | 25,000     |                |       |   | 25,000 |   |   | 7.500% |   | July 2029 |   |
| Total  Notes                            |       |                  |       |                                    |       |                        | 1,175,000  |                |       |   | 975,000 |   |   |   |   |   |   |
| Net  unamortized discount               |       |                  |       |                                    |       |                        | (5,911     | )                   |       |   | (4,822 | ) |   |   |   |   |   |
| Impact  of pay-floating swap agreements |       |                  |       |                                    |       |                        | (2,139     | )                   |       |   | (1,831 | ) |   |   |   |   |   |
| Total  Notes, net                       |       |                  |       |                                    |       |                        | $          | 1,166,950           |       |   |   | $ | 968,347 |   |   |   |   |   |   |
| CAPITAL  LEASES                         |       |                  |       |                                    |       |                        | $          | 27,500              |       |   |   | $ | 27,881 |   |   | 7.500% |   | June 2031 |   |
| TOTAL  DEBT                             | ** ** |                  |       |                                    |       |                        | $          | 1,834,360           |       |   |   | $ | 1,644,881 |   | ** ** | ** ** | ** ** | ** ** | ** ** |

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(1)             As discussed below, agreement was amended and restatedon August 25, 2006.

(2)             The Company incurs interest using the 30-dayLIBOR rate, which was 5.35% as of December 31, 2006. The interest rate onthis facility adjusts based on the Company’s credit rating.

(3)             The Company also incurs an annual facility fee of 15basis points on this facility.

(4)             As determined by the applicable loan agreement, theCompany incurs interest on these obligations using either the 30-dayLIBOR rate, which was 5.35% as of December 31, 2006, plus 125 basispoints, or the Moody’s A Corporate Bond Index, which was 5.46% as of December 31,2006, plus spreads ranging from 12.5 to 37.5 basis points.

F-29

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)**

(5)             Represents convertible senior notes. At certain dates,and upon the occurrence of certain events, the notes are convertible into cashup to their principal amount and, with respect to the remainder, if any, of theconversion value in excess of such principal amount, cash or shares of theCompany’s common stock. The initial conversion price is $25.00 per share. On orafter June 9, 2008, the Company may redeem all or a portion of the notesat a redemption price equal to the principal amount of the notes plus any accruedinterest. In addition, on June 1, 2010, June 1, 2012, and June 1,2018, or upon the occurrence of certain fundamental changes prior to June 1,2010, note holders have the right to require the Company to purchase all or anyportion of the notes, at a purchase price equal to the principal amount plusany accrued and unpaid interest on the notes. Although the stated maturity dateof the notes is June 1, 2023, the scheduled maturity date listed aboverepresents the first date that note holders have the right, not contingent onother provisions, to require the Company to redeem all or any portion of thenotes.

(6)             The Company has entered into reverse interest rate swapagreements that effectively convert the interest rate on $65.0 million of thenotes from a fixed rate to a blended floating rate of 30 basis points over thesix-month LIBOR rate.

(7)             Represents convertible senior notes issued in a privateoffering completed on September 19, 2006 (as further discussed below). Atcertain dates, and upon the occurrence of certain events, the notes areconvertible into cash up to their principal amount and, with respect to theremainder, if any, of the conversion value in excess of such principal amount,cash or shares of the Company’s common stock. The initial conversion rate is30.5506 shares of the Company’s common stock for each $1,000 principal amountof notes (which is equivalent to an initial conversion price of $32.73 pershare). On or after September 20, 2011, the Company may redeem all or aportion of the notes at a redemption price equal to the principal amount of thenotes plus any accrued interest. In addition, on September 20, 2011, September 15,2016, and September 15, 2021, or upon the occurrence of certain change incontrol transactions prior to September 20, 2011, note holders may requirethe Company to repurchase all or a portion of the notes at a purchase priceequal to the principal amount plus any accrued and unpaid interest on the notes.Although the stated maturity date of the notes is September 15, 2026, thescheduled maturity date listed above represents the first date that noteholders have the right, not contingent on other provisions, to require theCompany to redeem all or any portion of the notes.

On September 19, 2006, the Company completed aprivate offering of $200.0 million aggregate principal amount of 3.70% seniorconvertible notes due September 15, 2026 (the “September 2006 DebtOffering”).  At certain times and uponthe occurrence of certain events, the notes are convertible into cash up totheir principal amount and, with respect to the remainder, if any, of theconversion value in excess of such principal amount, cash or shares of theCompany’s common stock. The initial conversion rate will be 30.5506 shares per$1,000 principal amount of notes (which is equivalent to an initial conversionprice of $32.73 per share). The notes may not be redeemed by the Company priorto September 20, 2011 (except to preserve the Company’s status as a REITfor U.S. federal income tax purposes), but are redeemable anytime thereafter,in whole or in part, at a redemption price equal to the principal amount of thenotes plus any accrued and unpaid interest (including additional interest), ifany. In addition, on September 20, 2011, September 15, 2016, and September 15,2021, or upon the occurrence of certain change in control transactions prior toSeptember 20, 2011, note holders may require the Company to repurchase allor a portion of the notes at a purchase price equal to the principal amountplus any accrued and unpaid interest on the notes. Net proceeds from the September 2006Debt Offering were used to repurchase approximately $50.0 million of theCompany’s common stock at a price of $26.83 per share and for general corporatepurposes, including the repayment of outstanding borrowings under the Company’s$350.0 million unsecured revolving credit facility.

On August 25, 2006, the Company amended andrestated its existing $350.0 million unsecured revolving credit facility (asamended, the “Amended Revolving Facility”) and added an accordion feature tothe Amended Revolving Facility that allows the Company, subject to certainconditions, to increase the amount that can be borrowed under the facility to$500.0 million. The Amended Revolving Facility bears interest at LIBOR plus 55basis points (based on the Company’s current credit ratings) and incurs anannual facility fee of 15 basis points. The Amended Revolving Facility isscheduled to mature on August 25, 2010, with a one-year extension option.

F-30

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

On August 25, 2006, the Company also amended andrestated its existing $150.0 million secured term loan (as amended, the“Amended Secured Term Loan”). The Amended Secured Term Loan bears interest atLIBOR plus 55 basis points (based on the Company’s current credit ratings) andis scheduled to mature on August 25, 2010.

The Company’sability to borrow under both the Amended Revolving Facility and the AmendedSecured Term Loan (together, the “Credit Agreements”) is subject to its ongoingcompliance with a number of covenants, including with respect to the Company’sability to incur liens on its property, engage in major transactions such asmergers, make certain investments and engage in certain transactions with itsaffiliates. In addition, the Credit Agreements require that the Companymaintain certain financial coverage ratios and other debt covenants. As ofDecember 31, 2006, these coverage ratios and debt covenants included:

·       EBITDA(as defined in the applicable debt agreement) to fixed charges ratio of atleast 1.60:1;

·       minimumtangible net worth of approximately $1.2 billion;

·       totaldebt to total adjusted assets of no more than 60% (or 65% in certaincircumstances);

·       totalsecured debt to total adjusted assets of no more than 40%;

·       unsecureddebt to unencumbered assets value of no more than 60% (or 65% in certaincircumstances);

·       bookvalue of ancillary assets to total adjusted assets of no more than 25%;

·       bookvalue of new construction assets to total adjusted assets of no more than 15%;and

·       Fundsfrom Operations (as defined in the applicable debt agreement) payout ratio nogreater than 95%.

On September 19, 2005, the Company completed apublic offering of $125.0 million aggregate principal amount of seniorunsecured, 7-year fixed rate notes with a coupon of 5.125% (the “5.125%Notes”) and $125.0 million aggregate principal amount of senior unsecured, 10-yearfixed rate notes with a coupon of 5.25% (the “5.25% Notes”) (collectively, the“September 2005 Debt Offering”). The 5.125% Notes and the 5.25% Notes aredue on September 15, 2012 and 2015, respectively. The 5.125% Notes werepriced at 99.919% of par value to yield 5.139%. The 5.25% Notes were priced at99.372% of par value to yield 5.332%. Net proceeds from the offering were usedto redeem all $250.0 million of the Company’s outstanding 5.875% seniorunsecured notes that were due June 15, 2007 and were called for redemptionon August 4, 2005 at a redemption price of 100% of their principal amountplus any interest accrued up to, but excluding, the redemption date, and theapplicable “make-whole” premium of approximately $7.1 million relating to suchnotes. Concurrent with the pricing ofthe September 2005 Debt Offering, the Company settled five forwardstarting interest rate swap agreements with an aggregate of approximately$248.2 million in notional amount for an aggregate cost of approximately $9.5million.

On April 5, 2005, the Company entered into a$150.0 million unsecured term loan (the “Unsecured Term Loan”). Net proceedsfrom the Unsecured Term Loan were used to repay $100.0 million of the Company’s7.75% medium-term notes that were scheduled to mature on April 6, 2005, aswell as to repay a portion of the amount outstanding under the RevolvingFacility. On July 13, 2005, the Company amended the Unsecured Term Loan,increasing the amount that may be borrowed from $150.0 million to $200.0million, and concurrently increased the amount borrowed from $150.0 million to$200.0 million. On 

F-31

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

August 10, 2005, theCompany repaid the $200.0 million outstanding under the Unsecured Term Loanwith a portion of the proceeds generated from the Galileo Transactions, and asa result no further amounts are available for draw under this loan.

On January 13, 2005, the Company completed apublic offering of $100.0 million aggregate principal amount of unsecured, 10-yearfixed rate notes with a coupon of 5.30% (the “January 2005 DebtOffering”). These notes are due on January 15, 2015 and were priced at99.930% of par value to yield 5.309%. Net proceeds from the offering were usedto repay a portion of the amount outstanding under the Company’s then existing$350.0 million revolving credit facility. Concurrent with the pricing ofthe January 2005 Debt Offering, the Company settled four of its seven thenexisting 10-year forward starting interest rate swap agreements with anaggregate of approximately $100.0 million in notional amount for an aggregatecost of approximately $2.5 million.

As ofDecember 31, 2006, future expected/scheduled maturities of outstandinglong-term debt and capital lease obligations were as follows (in thousands):

| 2007                                                   |   | $         | 62,649    |   |
|--------------------------------------------------------|--------|-----------|-----------|--------|
| 2008                                                   |   | 174,404   |      |
| 2009                                                   |   | 199,138   |      |
| 2010                                                   |   | 371,362   |      |
| 2011                                                   |   | 372,221   |      |
| Thereafter                                             |   | 651,073   |      |
| Total debt  maturities                                 |   | 1,830,847 |      |
| Net unamortized premiums on mortgages                  |   | 11,563    |      |
| Net unamortized discount on notes                      |   | (5,911    | )         |
| Fair value adjustment on pay-floating swap  agreements |   | (2,139    | )         |
| Total debt obligations                                 |   | $         | 1,834,360 |   |

 

**11. OtherLiabilities**

Otherliabilities are comprised of the following (in thousands):

| ** **                                           | ** ** | **December 31, 2006** | ** ** | **December 31, 2005** | ** ** |
|------------------------------------------------------|------------|---------------------------------|------------|---------------------------------|------------|
| Property and  other taxes payable                    |       |                            | $          | 30,229                          |       |   |   | $ | 29,442 |   |   |
| Interest payable                                     |       |                            | 21,362     |                            |       |   | 19,324 |   |   |
| Accrued  professional and personnel costs            |       |                            | 22,325     |                            |       |   | 18,776 |   |   |
| Accrued  construction costs                          |       |                            | 9,685      |                            |       |   | 10,673 |   |   |
| Below market  leases, net                            |       |                            | 26,250     |                            |       |   | 10,575 |   |   |
| Swap contracts                                       |       |                            | 4,601      |                            |       |   | — |   |   |
| Accounts payable                                     |       |                            | 7,608      |                            |       |   | 6,532 |   |   |
| Deferred rent  expense and rents received in advance |       |                            | 7,115      |                            |       |   | 5,221 |   |   |
| Amounts due  seller of property                      |       |                            | 3,928      |                            |       |   | 3,846 |   |   |
| Accrued  acquisition / disposition costs             |       |                            | 4,277      |                            |       |   | 6,804 |   |   |
| Accrued insurance                                    |       |                            | 2,315      |                            |       |   | 6,087 |   |   |
| Deferred gain on  sale                               |       |                            | 342        |                            |       |   | — |   |   |
| Other                                                |       |                            | 10,548     |                            |       |   | 10,089 |   |   |
| Total                                                |       |                            | $          | 150,585                         |       |   |   | $ | 127,369 |   |   |

 

F-32

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

**12. Risk Managementand Use of Financial Instruments**

*Risk Management*

In the normal course ofits on-going business operations, the Company encounters economic risk. Thereare three main components of economic risk: interest rate risk, credit risk andmarket risk. The Company is subject to interest rate risk on itsinterest-bearing liabilities. Credit risk is the risk of default on the Company’soperations and tenants’ inability or unwillingness to make contractuallyrequired payments. Market risk includes changes in the value of the propertiesheld by the Company due to changes in interest rates or other market factors.

*Use of Derivative Financial Instruments*

The Company’s use of derivative instruments isprimarily limited to the utilization of interest rate agreements or otherinstruments to manage interest rate risk exposures and not for speculativepurposes. The principal objective of such arrangements is to manage the risksand/or costs associated with the Company’s operating and financial structure,as well as to hedge specific transactions. The counterparties to thesearrangements are major financial institutions with which the Company and itsaffiliates may also have other financial relationships. The Company ispotentially exposed to credit loss in the event of non-performance by thesecounterparties. However, because of their high credit ratings, the Company doesnot anticipate that any of the counterparties will fail to meet theseobligations as they come due. The Company does not use derivative instrumentsto hedge credit/market risk.

On August 2, 2005, the Company entered into twoforward starting interest rate swap agreements for an aggregate ofapproximately $148.2 million in notional amount. These derivative instrumentswere expected to be used to hedge the risk of changes in interest cash outflowson anticipated fixed rate financings by effectively locking the three-monthLIBOR swap rate. Concurrent with the pricing of the September 2005 DebtOffering, the Company settled both forward starting swaps discussed above, aswell as three other outstanding forward starting swaps, with an aggregate ofapproximately $248.2 million for an aggregate cost of approximately $9.5million. The effect of such payment was deferred and will be amortized intoearnings as an increase in the effective interest expense over the term of thefixed rate borrowings.

On August 2, 2006, the Company entered into twoforward starting interest rate swap agreements, each for $75.0 million innotional amount. One of the swaps is expected to be used to hedge the risk ofchanges in interest cash outflows on fixed rate 10-yearborrowings/financings that the Company anticipates issuing between February 1,2007 and October 31, 2007 by effectively locking the three-month LIBORswap rate. This swap terminates on June 15, 2017. The other swap isexpected to be used to hedge the risk of changes in interest cash outflows onfixed rate 10-year borrowings/financings that the Company anticipatesissuing between February 1, 2008 and October 31, 2008 by effectivelylocking the three-month LIBOR swap rate. This swap terminates on June 4,2018.

As of December 31, 2006, the Company also had tworeverse arrears swap agreements. The reverse arrears swap agreementseffectively convert the interest rate on $65.0 million of the Company’s debtfrom a fixed rate to a blended floating rate of 30 basis points over thesix-month LIBOR rate. The two reverse arrears swap agreements terminate on February 1,2011.

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

The following tablesummarizes the terms and fair values of the Company’s derivative financialinstruments at December 31, 2006 (dollars in thousands). The notionalamounts at December 31, 2006 provide an indication of the extent of theCompany’s involvement in these instruments at that time, but do not representexposure to credit, interest rate or market risks.

| ** **             | **Hedge Product** | ** **     | ** ** | **Hedge Type** | ** ** | **Notional   Amount** | ** ** | **Strike** | ** ** | **Maturity** | ** ** | **Fair Value** | ** ** |
|------------------------|------------------------|----------------|------------|---------------------|------------|----------------------------|------------|------------|------------|--------------|------------|---------------------|------------|
| Reverse Arrears  Swap  |                   | Fair  Value    |       | $                   | 50,000     |                       | 4.380      | %          | 02/01/11   |         |       | $                   | (1,454     | ) |   |
| Reverse Arrears  Swap  |                   | Fair  Value    |       | 15,000              |       | 4.030                      | %          | 02/01/11   |       |         | (685       | )                   |       |
| Forward Starting  Swap |                   | Interest  Rate |       | 75,000              |       | 5.558                      | %          | 06/15/17   |       |         | (2,337     | )                   |       |
| Forward Starting  Swap |                   | Interest  Rate |       | 75,000              |       | 5.612                      | %          | 06/04/18   |       |         | (2,264     | )                   |       |
|                   |                   |           |       | $                   | 215,000    |                       |       |       |       |         |       | $                   | (6,740     | ) |   |

 

As of December 31, 2006, the reverse arrears swapdebt of approximately $2.1 million was reported as a component of the notespayable to which it was assigned. As of December 31, 2006, the forwardstarting swaps of approximately $4.6 million were reported in Other Liabilities.As of December 31, 2006, there were approximately $8.7 million in deferredlosses, net, included in OCI, representing the unamortized portion of thesettled swaps.

Over time, the unrealizedgains and losses held in OCI (Note 17) will be reclassified to earnings in thesame period(s) in which the hedged items are recognized in earnings. Approximately$1.3 million of expense, net, is expected to be amortized over the next 12months. The current balance held in OCI is expected to be reclassified toearnings over the lives of the current hedging instruments, or for realized losseson forecasted debt transactions, over the related term of the debt obligation,as applicable.

*Concentration of Credit Risk*

A concentration of creditrisk arises in the Company’s business when a national or regionally-basedtenant occupies a substantial amount of space in multiple properties owned bythe Company. In that event, if the tenant suffers a significant downturn in itsbusiness, it may become unable to make its contractual rent payments to theCompany, exposing the Company to a potential loss in rental revenue that ismagnified as a result of the tenant renting space in multiple locations. TheCompany regularly monitors its tenant base to assess potential concentrationsof credit risk. Management believes the current credit risk portfolio is reasonablywell diversified and does not contain any unusual concentration of credit risk.No tenant exceeds 5% of the Company’s annual reported rental income.

**13. MinorityInterest in Consolidated Partnership and Joint Ventures**

In1995, ERP, a consolidated entity, was formed to own certain real estateproperties. A wholly owned subsidiary of the Company is the sole generalpartner of ERP and is entitled to receive 99% of all net income and gainsbefore depreciation, if any, after the limited partners receive their preferredcash and gain allocations. Properties have been contributed to ERP in exchangefor limited partnership units (which may be redeemed at stipulated prices forcash or, at the Company’s option, shares of common stock of the Company atcertain exchange rates), cash and the assumption of mortgage indebtedness. On September 27,2005, in conjunction with the payment of a special cash distribution to theCompany’s common stockholders of $3.00 per common share (see Note 14), certainunitholders received a corresponding special cash distribution of $3.00 perunit, which special cash distributions aggregated 

F-34

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

approximately $4.4 million. Unitholders who were notentitled to receive the special cash distribution received an adjustment totheir exchange ratio, which adjustment accounts for the payment of the specialcash distribution. After such adjustments, exchange ratios currently range from1.0 to 1.6. ERP unit information is summarized as follows:

| ** **                             | ** ** | **Total  Units** | ** ** | **Company  Units** | ** ** | **Limited Partner   Units** | ** ** |
|----------------------------------------|------------|------------------|------------|--------------------|------------|---------------------------------------|------------|
| Outstanding at  December 31, 2004 |       | 6,715,566        |       | 5,109,215          |       |                                  | 1,606,351  |   |   |
| Issued (1)                             |       | 1,167,922        |       | —             |       |                                  | 1,167,922  |   |   |
| Redeemed                               |       | —           |       | —             |       |                                  | —     |   |   |
| Outstanding at  December 31, 2005 |       | 7,883,488        |       | 5,109,215          |       |                                  | 2,774,273  |   |   |
| Issued (2)                             |       | 175,885          |       | —             |       |                                  | 175,885    |   |   |
| Redeemed (3)                           |       | —           |       | 135,106            |       |                                  | (135,106   | ) |   |
| Outstanding at  December 31, 2006 |       | 8,059,373        |       | 5,244,321          |       |                                  | 2,815,052  |   |   |

----

(1)          Represents limitedpartnership units issued in connection with the Company’s acquisition of (1) HillcrestShopping Center (612,763 limited partnership units) and (2) a partialinterest in two properties currently held in NP/I&G Institutional RetailCompany, LLC, one of the Company’s joint ventures (555,159 limited partnershipunits).

(2)          Represents limitedpartnership units issued in connection with the Company’s acquisition of FoxRun Mall.

(3)          Represents theredemption of limited partnership units in exchange for shares of the Company’scommon stock or cash.

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

**14. Stockholders’Equity**

*Earnings per Share (EPS)*

Inaccordance with the disclosure requirements of SFAS No. 128 (Note 2), areconciliation of the numerator and denominator of basic and diluted EPS isprovided as follows (in thousands, except per share amounts and amounts in thefootnote below):

| ** **                                                                   | ** ** | **Year Ended December 31,** | ** ** |
|------------------------------------------------------------------------------|------------|--------------------------------------------|------------|
| ** **                                                                   | ** ** | **2006**                                   | ** ** | **2005** | ** ** | **2004** | ** ** |
| **Basic EPS**                                                                |       |                                       |       |   |   |   |   |
| **Numerator:**                                                               |       |                                       |       |   |   |   |   |
| Income from continuing  operations and gain on sale of real estate           |       | $                                          | 113,451    |   | $ | 276,184 |   | $ | 120,558 |   |
| Preferred dividends                                                          |       | (21,966                                    | )          | (21,888 | ) | (21,470 | ) |
| Income available to  common shares from continuing operations—basic     |       | 91,485                                     |       | 254,296 |   | 99,088 |   |
| Income available to  common shares from discontinued operations—basic   |       | 21,766                                     |       | 30,140 |   | 13,382 |   |
| Net income available to  common shares—basic                            |       | $                                          | 113,251    |   | $ | 284,436 |   | $ | 112,470 |   |
| **Denominator:**                                                             |       |                                       |       |   |   |   |   |
| Weighted average of  common shares outstanding                               |       | 104,102                                    |       | 103,393 |   | 100,894 |   |
| Earnings per  share—continuing operations                               |       | $                                          | 0.88       |   | $ | 2.53 |   | $ | 1.04 |   |
| Earnings per  share—discontinued operations                             |       | 0.21                                       |       | 0.22 |   | 0.07 |   |
| Basic earnings per  common share                                             |       | $                                          | 1.09       |   | $ | 2.75 |   | $ | 1.11 |   |
| **Diluted  EPS**                                                             |       |                                       |       |   |   |   |   |
| **Numerator:**                                                               |       |                                       |       |   |   |   |   |
| Income from continuing  operations and gain on sale of real estate           |       | $                                          | 113,451    |   | $ | 276,184 |   | $ | 120,558 |   |
| Preferred dividends                                                          |       | (21,966                                    | )          | (21,888 | ) | (21,470 | ) |
| Minority interest in  consolidated partnership                               |       | 745                                        |       | 5,070 |   | 796 |   |
| Income available to  common shares from continuing operations—diluted   |       | 92,230                                     |       | 259,366 |   | 99,884 |   |
| Income available to  common shares from discontinued operations—diluted |       | 21,766                                     |       | 30,140 |   | 13,382 |   |
| Net income available to  common shares—diluted                          |       | $                                          | 113,996    |   | $ | 289,506 |   | $ | 113,266 |   |
| **Denominator:**                                                             |       |                                       |       |   |   |   |   |
| Weighted average of  common shares outstanding—basic                    |       | 104,102                                    |       | 103,393 |   | 100,894 |   |
| Effect of diluted  securities:                                               |       |                                       |       |   |   |   |   |
| Excel Realty Partners,  L.P. third party units                               |       | 2,922                                      |       | 2,337 |   | 1,394 |   |
| Options and contingently  issuable shares                                    |       | 1,616                                      |       | 1,003 |   | 1,057 |   |
| Convertible debt                                                             |       | 139                                        |       | 35 |   | — |   |
| Restricted stock                                                             |       | 35                                         |       | 66 |   | — |   |
| Weighted average of  common shares outstanding—diluted                  |       | 108,814                                    |       | 106,834 |   | 103,345 |   |
| Earnings per  share—continuing operations                               |       | $                                          | 0.85       |   | $ | 2.49 |   | $ | 1.03 |   |
| Earnings per  share—discontinued operations                             |       | 0.20                                       |       | 0.22 |   | 0.07 |   |
| Diluted earnings per common share                                            |       | $                                          | 1.05       |   | $ | 2.71 |   | $ | 1.10 |   |

----

Note—For the year ended December 31, 2004 therewere approximately 0.6 million stock options that were anti-dilutive.

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

*Common Stock*

To maintain its qualification as a REIT, not more than50% in value of the outstanding shares of the Company may be owned, directly orindirectly, by five or fewer individuals at any time during the last half ofany taxable year of the Company (defined to include certain entities), applyingcertain constructive ownership rules. To help ensure that the Company will notfail this test, the Company’s Articles of Incorporation provide for, amongother things, certain restrictions on the transfer of common stock to preventfurther concentration of stock ownership. Moreover, to evidence compliance withthese requirements, the Company must maintain records that disclose the actualownership of its outstanding common stock and will demand written statementseach year from the holders of record of designated percentages of its commonstock requesting the disclosure of the beneficial owners of such common stock.

In conjunction with theGalileo Transactions, the Company’s Board of Directors declared a special cashdistribution of $3.00 per common share (the “Special Dividend”). Thedistribution was paid on September 27, 2005 to common stockholders ofrecord on August 25, 2005, and aggregated approximately $310.4 million.

*Stock Repurchases*

In October 1999, the Company commenced a programto repurchase up to $75.0 million of the Company’s outstanding commonstock from time to time through periodic open market transactions or throughprivately negotiated transactions, which program expired on December 31,2005. Through December 31, 2005, approximately 2,150,000 shares wererepurchased and retired at an average purchase price of $15.30 per share. InFebruary 2006, the Company renewed the repurchase program to provide forthe repurchase of up to $75.0 million of the Company’s outstanding common stockfrom time to time through periodic open market transactions or throughprivately negotiated transactions. Through December 31, 2006, no shareshave been repurchased under the renewed common stock repurchase program.

In September 2006,the Company obtained separate authorization to repurchase up to an additional$75.0 million of its common stock in connection with the September 2006Debt Offering (see Note 8). Concurrently with the September 2006 Debt Offering,pursuant to such separate authorization, 1,863,600 shares were repurchased andretired at an average purchase price of $26.83 per share (approximately $50.0million in aggregate value). Due to the fact that the Company completed theoffering on September 19, 2006, no additional repurchases may be madepursuant to this authorization.

*Preferred Stock*

The Company has 8,000,000 Series E depositaryshares outstanding, each representing a 1/10 fractional interest of a share of7.625% Series E Cumulative Redeemable Preferred Stock.

The Company also has1,500,000 Series D depositary shares outstanding, each representing a 1/10fractional interest in a share of 7.8% Series D Cumulative Voting Step-UpPremium Rate Preferred Stock (the “Preferred D Shares”), which are redeemableat the option of the Company on or after June 15, 2007 at a liquidationpreference of $500 per share. The Preferred D Shares pay dividends quarterly atthe rate of 7.8% of the liquidation preference per annum throughSeptember 2012 and at the rate of 9.8% of the liquidation preference perannum thereafter. Beginning in the third quarter of 2004, in accordance withapplicable accounting rules, and as a result of the “step-up” of the dividendto 9.8% of the liquidation preference beginning in 2012, the Company recordedquarterly non-cash increases to the current dividend 

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

payable.  For the year ended December 31, 2006,the Company recorded total, non-cash increases of approximately $0.9 million.The Company expects to continue recognizing additional quarterly non-cashcharges with respect to the Preferred D Shares through 2012 in amounts that arenot expected to vary materially from the amounts recognized in 2006.

*Stock Based Compensation*

*Stock Options*

In December 2004, the FASB issued Statement No. 123(Revised 2004), *Share-Based Payment* (“SFAS No. 123(R)”),which is a revision of Statement No. 123, *Accountingfor Stock-Based Compensation* (“SFAS No. 123”). SFAS No. 123(R) supersedesAccounting Principles Board Opinion No. 25, *Accountingfor Stock Issued to Employees*(“Opinion 25”). Generally, theapproach to accounting for stock-based compensation in SFAS No. 123(R) issimilar to the approach described in SFAS No. 123. However, SFAS No. 123(R) requiresall stock-based compensation to employees, including grants of employee stockoptions, to be recognized in the statement of operations based on their fairvalues. Pro-forma disclosure is no longer an alternative under SFAS No. 123(R).

SFAS No. 123(R) became effective for fiscalyears beginning after December 31, 2005. The Company adopted theprovisions of SFAS No. 123(R) using the modified prospectivetransition method during the first quarter of 2006. Under the modifiedprospective transition method, compensation cost is recognized beginning withthe adoption date (i) based on the requirements of SFAS No. 123(R) forall share-based payments granted after the adoption date and (ii) based onthe requirements of SFAS No. 123 for all awards granted to employees priorto the adoption date of SFAS No. 123(R) that remain unvested on theeffective date.

During the year ended December 31, 2006, theCompany recorded approximately $2.7 million of stock-based compensation, whichexpense included approximately $0.8 million related to stock options,approximately $0.8 million for restricted stock grants and approximately $1.1million for other stock awards (see below for additional information). Stock-basedcompensation is recorded as a reduction to additional paid in capital. Cashreceived from option exercises for the year ended December 31, 2006 wasapproximately $8.2 million.

Prior to the adoption of SFAS No. 123(R), theCompany accounted for its stock-based compensation under the provisions ofStatement No. 148, *Accounting for Stock-BasedCompensation—Transition and Disclosure—an amendment of FAS 123* (“SFASNo. 148”), which was issued in December 2002. SFAS No. 148provides alternative transition methods for a voluntary change to the fairvalue basis of accounting for stock-based employee compensation. However, SFAS No. 148does not permit the use of the original SFAS No. 123 prospective method oftransition for changes to fair value based methods made in fiscal yearsbeginning after December 15, 2003. In addition, SFAS No. 148 amendsthe disclosure requirements of SFAS No. 123 to require prominentdisclosures in both annual and interim financial statements about the method ofaccounting for stock-based employee compensation, a description of thetransition method utilized and the effect of the method used on reportedresults. The transition and annual disclosure provisions of SFAS No. 148are to be applied for fiscal years ending after December 15, 2002. Theinterim disclosure provisions of SFAS No. 148 are effective for the firstinterim period beginning after December 15, 2002. In January 2003,the Company adopted the prospective method provisions of SFAS No. 148,which apply the recognition provisions of SFAS 123 to all employee stock awardsgranted, 

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

modified or settled after January 1,2003. The adoption of SFAS No. 148 did not have a material impact on theconsolidated financial statements of the Company.

With respect to the Company’s stock options which weregranted prior to 2003, the Company accounted for stock-based compensation usingthe intrinsic value method prescribed in Opinion 25 and related interpretations.Under Opinion 25, compensation cost is measured as the excess, if any, of thequoted market price of the Company’s stock at the date of grant over theexercise price of the option granted. Compensation cost for stock options, ifany, is recognized ratably over the vesting period. The Company’s policy is togrant options with an exercise price equal to the quoted closing market priceof the Company’s stock on the business day preceding the grant date. Accordingly,no compensation cost has been recognized for the years ending December 31,2004 and 2003 under the Company’s stock option plans for the granting of stockoptions made prior to December 31, 2002. Beginning in August 2005, asa result of the amendments to the stock options discussed above, and to theextent the stock options have not vested, all stock-based compensationpreviously accounted for under Opinion 25 was revalued under the fair valuemethods of SFAS No. 123.

SFAS No. 148disclosure requirements, including the effect on net income and earnings pershare if the fair value based method had been applied to all outstanding andunvested stock awards in each period, are presented below (dollars inthousands, except per share amounts):

| ** **                                                                                                                            | ** ** | **For the Year Ended** | ** ** |
|---------------------------------------------------------------------------------------------------------------------------------------|------------|---------------------------------------|------------|
| ** **                                                                                                                            | ** ** | **December 31,**                 | ** ** |
| ** **                                                                                                                            | ** ** | **2005**                              | ** ** | **2004** | ** ** |
| Net income, as  reported                                                                                                              |       | $                                     | 306,324    |   | $ | 133,940 |   |
| Total stock based  employee compensation expense determined under fair value based method for  all awards, net of related tax effects |       | (346                                  | )          | (1,240 | ) |
| Pro forma net income                                                                                                                  |       | $                                     | 305,978    |   | $ | 132,700 |   |
| Earnings per  share:                                                                                                                  |       |                                  |       |   |   |
| Basic—as reported                                                                                                                |       | $                                     | 2.75       |   | $ | 1.11 |   |
| Basic—pro forma                                                                                                                  |       | $                                     | 2.75       |   | $ | 1.10 |   |
| Earnings per  share:                                                                                                                  |       |                                  |       |   |   |
| Diluted—as reported                                                                                                              |       | $                                     | 2.71       |   | $ | 1.10 |   |
| Diluted—pro forma                                                                                                                |       | $                                     | 2.71       |   | $ | 1.08 |   |

 

The Company currently has one active stock option planpursuant to which stock options have been granted to purchase shares of commonstock of the Company to officers, directors, and certain employees of theCompany. Previously, options remained outstanding under three terminated stockoption plans, and under two option grants made to the Company’s Chief ExecutiveOfficer in February 2000. These prior outstanding option grants are nowincorporated under the active stock option plan. The active plan is the 2003Stock Incentive Plan, as amended and restated effective July 14, 2005 (the“2003 Plan”), which provides for the grant of stock options, stock grants andcertain other types of stock based awards to officers, directors and certainemployees of the Company. The exercise price of stock options granted pursuantto the 2003 Plan is required to be no less than the fair market value of ashare of common stock on the date of grant. The vesting schedule and otherterms of stock options granted under the 2003 Plan are determined at the timeof grant by the Company’s executive compensation and stock option 

F-39

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

committee. As of December 31,2006, approximately 2.0 million shares were available for stock option grantsand 0.8 million shares were available for stock grants or other types of stockbased awards other than stock option grants (and to the extent that any suchstock grants or other types of stock based awards are issued, then there is ashare for share reduction in the number of shares available for stock optiongrants) under the 2003 Plan. The stock options outstanding under the 2003 Plan,at December 31, 2006, had exercise prices ranging from $11.35 to $25.05and a weighted average remaining contractual life of approximately 6.3 years. Thetotal amount of option shares exercisable under the 2003 Plan, at December 31,2006, was approximately 2.1 million.

During 2005, in order to counteract the dilutiveeffect on the options outstanding resulting from the payment of the SpecialDividend, the Company amended its outstanding option grants to adjust both thenumber of options outstanding and the related exercise prices. As a result ofthe amendment, the Company computed an incremental charge representing thechange in fair value immediately before and after the modification of theoptions of approximately $1.1 million. Approximately $0.7 million of thisincremental charge related to options which were fully vested, and was expensedimmediately. The remainder of the incremental charge will be reflected inexpense over the remaining service periods of the grants.

The Company uses the Black-Scholes-Merton closed-formmodel (“Black-Scholes option pricing model”), which uses the assumptionsdetailed in the following table, to value its stock option and restricted stockgrants. Expected volatilities are based on historical volatility of the Company’sstock. The Company uses historical data to estimate option exercises andemployee terminations within the valuation model. The expected term of optionsgranted is derived from the output of the option valuation model and representsthe period of time that options are expected to be outstanding. The risk-freerates for periods within the contractual life of the option are based on theU.S. Treasury yield curve in effect at the time of grant. The Company’s use ofthe Black-Scholes option pricing model requires extensive use of accountingjudgment and financial estimates, including estimates of the expected termemployees will retain their vested stock options before exercising them, theestimated volatility of the Company’s common stock price over the expectedterm, and the number of options that will be forfeited prior to the completionof the vesting requirements. Application of alternative assumptions couldproduce significantly different estimates of the fair value of stock-basedcompensation, and consequently, significantly different amounts recognized inthe Consolidated Statements of Operations. The provisions of SFAS No. 123(R) applyto new stock option grants and stock options outstanding, but not yet vested,on the date the Company adopted SFAS No. 123(R).

TheCompany believes that the use of the Black-Scholes option pricing model meetsthe fair value measurement objectives of SFAS No. 123(R) and reflectsall substantive characteristics of the instruments being valued. The followingtable represents the assumptions used for the Black-Scholes option pricingmodel to determine the per share weighted average fair value of $2.02 foroptions granted during the year ended December 31, 2006, and the fairvalue of $1.10 for options granted during the year ended December 31,2005:

| ** **               | ** ** | **December 31, 2006** | ** ** | **December 31, 2005** | ** ** |
|--------------------------|------------|---------------------------------|------------|---------------------------------|------------|
| Expected dividend  yield |       | 6.50%                           |       |                            | 7.50%      |   |   |
| Risk-free  interest rate |       | 4.65% – 4.75%              |       |                            | 3.55%      |   |   |
| Expected  volatility     |       | 18.00%                          |       |                            | 15.00%     |   |   |
| Expected life in years   |       | 1.5 years – 5.5 years      |       |                            | 3.0 years  |   |   |

 

F-40

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

Thefollowing tables summarize information concerning outstanding and exercisableoptions as of December 31, 2006, after giving effect to the amendmentdescribed above:

| ** **              | ** ** | **OPTIONS OUTSTANDING** | ** ** | **OPTIONS EXERCISABLE**                                            | ** ** |
|-------------------------|------------|------------------------------|------------|-------------------------------------------------------------------------|------------|
| **Exercise Price** | ** ** | **Options  Outstanding**     | ** ** | **Weighted Average   Remaining   Contractual Life** | ** ** | **Weighted   Average   Exercise Price** | ** ** | **Currently  Exercisable** | ** ** | **Weighted Average  Exercise  Price** | ** ** |
| $11.35                  |       |                         | 695,721    |                                                                    |       |   | 3.1 years |   |   |   |   |   |   | 695,721 |   |   |   |   |   |
| $12.23                  |       |                         | 16,942     |                                                                    |       |   | 3.4 years |   |   |   |   |   |   | 16,942 |   |   |   |   |   |
| $12.40                  |       |                         | 63,254     |                                                                    |       |   | 3.7 years |   |   |   |   |   |   | 63,254 |   |   |   |   |   |
| $13.71                  |       |                         | 245,401    |                                                                    |       |   | 4.2 years |   |   |   |   |   |   | 245,401 |   |   |   |   |   |
| $15.15                  |       |                         | 18,071     |                                                                    |       |   | 4.4 years |   |   |   |   |   |   | 18,071 |   |   |   |   |   |
| $16.97                  |       |                         | 443,032    |                                                                    |       |   | 6.2 years |   |   |   |   |   |   | 110,481 |   |   |   |   |   |
| $17.41                  |       |                         | 23,152     |                                                                    |       |   | 5.4 years |   |   |   |   |   |   | 23,152 |   |   |   |   |   |
| $17.60                  |       |                         | 132,572    |                                                                    |       |   | 2.4 years |   |   |   |   |   |   | 132,572 |   |   |   |   |   |
| $17.70                  |       |                         | 651,673    |                                                                    |       |   | 5.3 years |   |   |   |   |   |   | 367,129 |   |   |   |   |   |
| $17.77                  |       |                         | 16,940     |                                                                    |       |   | 2.4 years |   |   |   |   |   |   | 16,940 |   |   |   |   |   |
| $18.45                  |       |                         | 39,530     |                                                                    |       |   | 6.4 years |   |   |   |   |   |   | 39,530 |   |   |   |   |   |
| $21.08                  |       |                         | 42,072     |                                                                    |       |   | 7.4 years |   |   |   |   |   |   | 42,072 |   |   |   |   |   |
| $22.75                  |       |                         | 566,223    |                                                                    |       |   | 8.2 years |   |   |   |   |   |   | 102,647 |   |   |   |   |   |
| $23.11                  |       |                         | 549,631    |                                                                    |       |   | 7.2 years |   |   |   |   |   |   | 185,959 |   |   |   |   |   |
| $23.61                  |       |                         | 41,750     |                                                                    |       |   | 8.4 years |   |   |   |   |   |   | 41,750 |   |   |   |   |   |
| $23.85                  |       |                         | 44,614     |                                                                    |       |   | 8.4 years |   |   |   |   |   |   | 44,614 |   |   |   |   |   |
| $25.05                  |       |                         | 846,000    |                                                                    |       |   | 9.2 years |   |   |   |   |   |   | — |   |   |   |   |   |
| Total                   |       |                         | 4,436,578  |                                                                    |       |   | 6.3 years |   |   |   | $ | 19.17 |   |   | 2,146,235 |   |   | $ | 15.95 |   |   |
|                         |            |                              |            |                                                                         |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

F-41

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

Stockoption activity is summarized as follows:

| ** **                                                           | ** ** | **Option  Shares** | ** ** | **Weighted Average  Exercise Price  Per Share** | ** ** |
|----------------------------------------------------------------------|------------|--------------------|------------|----------------------------------------------------------------|------------|
| Outstanding at  December 31, 2003                               |       | 4,304,598          |       |                                                           | $          | 18.33 |   |   |
| Granted                                                              |       | 669,750            |       |                                                           | $          | 25.97 |   |   |
| Exercised                                                            |       | (951,822           | )          |                                                           | $          | 20.98 |   |   |
| Forfeited                                                            |       | (217,402           | )          |                                                           | $          | 22.53 |   |   |
| Outstanding at  December 31, 2004                               |       | 3,805,124          |       |                                                           | $          | 18.85 |   |   |
| Granted                                                              |       | 596,200            |       |                                                           | $          | 25.77 |   |   |
| Adjustment to  outstanding grants due to payment of Special Dividend |       | 480,387            |       |                                                           | $          | 17.53 |   |   |
| Exercised                                                            |       | (486,503           | )          |                                                           | $          | 17.85 |   |   |
| Forfeited                                                            |       | (281,995           | )          |                                                           | $          | 21.68 |   |   |
| Outstanding at  December 31, 2005                               |       | 4,113,213          |       |                                                           | $          | 17.59 |   |   |
| Granted                                                              |       | 891,750            |       |                                                           | $          | 24.98 |   |   |
| Exercised                                                            |       | (505,222           | )          |                                                           | $          | 16.51 |   |   |
| Forfeited                                                            |       | (63,163            | )          |                                                           | $          | 19.95 |   |   |
| Outstanding at  December 31, 2006                               |       | 4,436,578          |       |                                                           | $          | 19.17 |   |   |
| Options exercisable at December 31, 2006                        |       | 2,146,235          |       |                                                           | $          | 15.95 |   |   |
| Options  exercisable at December 31, 2005                       |       | 1,810,493          |       |                                                           | $          | 14.69 |   |   |
| Options exercisable at  December 31, 2004                       |       | 1,163,867          |       |                                                           | $          | 16.82 |   |   |

 

Certain of the Company’soption grants vest upon satisfaction of annual performance/market criteria,while other grants vest over time.

*Restricted Stock Awards*

During the year ended December 31, 2006, theCompany granted 50,060 restricted shares of common stock to certain employees. Ofthese shares, 25,030 will vest proportionately over five years, commencing on June 30,2007, and then on the next four succeeding anniversary dates of the date ofgrant, which was March 31, 2006. The balance of the restricted shares vestproportionately over the same five year period upon satisfaction of annualperformance/market criteria established each year by the Company’s executivecompensation and stock option committee.

For accounting purposes, the Company measurescompensation costs for restricted shares in accordance with the provisions ofSFAS No. 123(R), as discussed above.

F-42

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

Thefollowing table reports restricted stock activity during the year ended December 31,2006:

| ** **                                 | ** ** | **Number of   Shares** | ** ** | **Intrinsic Value** | ** ** |
|--------------------------------------------|------------|----------------------------------|------------|--------------------------|------------|
| Unvested Shares  at December 31, 2005 |       |                             | 133,036    |                     |       |   | $ | 3,083,774 |   |   |
| Granted                                    |       |                             | 50,060     |                     |       |   |   |   |   |
| Vested and  Distributed                    |       |                             | (32,758    | )                        |       |   | $ | 818,304 |   |   |
| Forfeited                                  |       |                             | (1,500     | )                        |       |   |   |   |   |
| Unvested Shares at  December 31, 2006 |       |                             | 148,838    |                     |       |   | $ | 4,090,068 |   |   |

 

As of December 31,2006, there was approximately $2.9 million of total unrecognized compensationcost related to non-vested stock-based compensation arrangements, specifically,previously granted shares of restricted stock and options. That cost isexpected to be recognized over a weighted-average period of approximately 2.0years.

*Other Stock Awards*

During the years ended December 31, 2006 and2005, the Company also granted 6,903 and 7,047 shares of common stock,respectively, to members of its Board of Directors. These shares vestedimmediately upon grant. For accounting purposes, the Company measuredcompensation costs for these shares as of the date of grant and expensed suchamounts against earnings on the grant date. Such amounts appear on the Company’sConsolidated Statements of Income and Comprehensive Income under “General andadministrative.”

Pursuant to the terms of the New Plan Excel RealtyTrust, Inc. 2006 Long-Term Out-Performance Compensation Plan (“Out-PerformancePlan”), the Company’s current executive officers, other than Glenn Rufrano, theCompany’s Chief Executive Officer, and William Newman, the Company’s Chairmanof the Board of Directors, are entitled to receive an award of common stock inthe event that over either a four or five year performance period ending December 31,2009 or December 31, 2010, respectively, either of two specifiedperformance criteria are achieved. The value of the common stock award willvary based on the level of performance achieved, but the maximum award ofcommon stock that can be achieved is $12.0 million. The compensation expense ofapproximately $3.5 million associated with this award will be recognizedratably over the service period.

Pursuant to the terms of the Company’s employmentagreement with Mr. Rufrano, he may receive an award of common stockin the event that over either a four or five year performance period, ending February 22,2009 or February 22, 2010, respectively, either of two specifiedcriteria are achieved. The value of the common stock award will vary based onthe level of performance achieved, but the maximum award of commonstock that can be achieved is $6.0 million. The compensation expense ofapproximately $2.2 million associated with this award will be recognizedratably over the service period.

The Company used a Monte Carlo analysis to value the Out-PerformancePlan and Mr. Rufrano’s performance award. The Monte Carlo analysis is asimulation exercise designed to arrive at a value for a variable, such as theexpected value of an award on the valuation date.

F-43

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

DividendsPaid and Payable (in thousands):

| Dividends  declared in 2004, paid in 2004 (1)    |   | $       | 140,729 |   |
|--------------------------------------------------|--------|---------|---------|--------|
| Dividends  declared in 2004, paid in 2005 (1)    |   | 47,699  |    |
| Dividends  declared in 2005, paid in 2005 (1)(2) |   | 444,353 |    |
| Dividends  declared in 2005, paid in 2006 (1)    |   | 37,870  |    |
| Dividends  declared in 2006, paid in 2006 (1)    |   | 113,515 |    |
| Dividends declared in  2006, payable in 2007 (1) |   | 37,550  |    |

----

(1)          Amount does not includethe quarterly non-cash adjustments to account for the Preferred D dividend“step-up” discussed in the Preferred Stock section above.

(2)          Amount includes paymentof the Special Dividend.

Distributionsto shareholders will generally be taxable as ordinary income, although aportion of such dividends may be designated by the Company as capital gain ormay constitute a tax-free return of capital. The Company annually furnishes toeach of its shareholders a statement setting forth the distributions paidduring the preceding year and their characterization as ordinary income,capital gain or return of capital. The percentage of distributionscharacterized as ordinary income, capital gain and return of capital for theyears ended December 31, 2006, 2005 and 2004 are summarized in thefollowing table:

| ** **        | ** ** | **For the year ended  December 31,** | ** ** |
|-------------------|------------|----------------------------------------------------------|------------|
| ** **        | ** ** | **2006**                                                 | ** ** | **2005** | ** ** | **2004** | ** ** |
| Ordinary income   |       |                                                     | 73         | % |   |   | 27 | % |   |   | 94 | % |   |
| Capital gain      |       |                                                     | 17         | % |   |   | 72 | % |   |   | — |   |   |
| Return of capital |       |                                                     | 10         | % |   |   | 1 | % |   |   | 6 | % |   |

 

The Company intends tocontinue to declare quarterly distributions. No assurance, however, can beprovided as to the amounts or timing of future distributions, as themaintenance of such distributions is subject to various factors, including thediscretion of the Company’s Board of Directors, limitation provisions of theCompany’s debt instruments, the ability to pay dividends under Maryland law,the availability of cash to make the necessary dividend payments and the effectof REIT distribution requirements.

*Dividend Reinvestment Plan*

The Company has a DividendReinvestment and Share Purchase Plan whereby shareholders may invest cashdistributions and make optional cash payments to purchase shares of theCompany. The additional shares currently are issued directly by the Company.

*Deferred Compensation Plan*

Effective July 1,2004, the Company adopted a deferred compensation plan, which was amended andrestated as of January 1, 2005. The purpose of the plan is to provideparticipants with the opportunity to defer receipt of a portion of theirsalary, bonus and other specified cash and equity-based compensation.Eligibility for the plan is determined at the sole discretion of the Company’sExecutive Compensation and Stock Option Committee. The Company has establishedgrantor trusts, also known as Rabbi Trusts, to act 

F-44

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

asvehicles for accumulating the assets needed to pay the promised benefit. As ofDecember 31, 2006, the assets under the plan, which are reflected inPrepaid expenses and deferred charges on the Company’s Consolidated BalanceSheets, and the corresponding liabilities under the plan, which are reflectedin Other liabilities on the Company’s Consolidated Balance Sheets, wereapproximately $3.3 million. Expenses for the years ended December 31,2006, 2005 and 2004 were immaterial.

**15. Fair Value ofFinancial Instruments**

The following fair value disclosure was determined bythe Company, using available market information and discounted cash flowanalyses as of December 31, 2006 and 2005, respectively. The discount rateused in calculating fair value is the sum of the current risk free rate and therisk premium on the date of acquiring/assuming the instruments/obligations. Considerablejudgment is necessary to interpret market data and to develop the relatedestimates of fair value. Accordingly, the estimates presented are notnecessarily indicative of the amounts that the Company could realize upondisposition. The use of different estimation methodologies may have a materialeffect on the estimated fair value amounts. The Company believes that thecarrying amounts reflected in the Consolidated Balance Sheets at December 31,2006 and 2005 approximate the fair values for cash and cash equivalents,marketable securities, receivables and other liabilities.

Thefollowing are financial instruments for which Company estimates of fair valuediffer from carrying amounts (in thousands):

| ** **                      | ** ** | **December 31, 2006** | ** ** | **December 31, 2005** | ** ** |
|---------------------------------|------------|---------------------------------|------------|---------------------------------|------------|
| ** **                      | ** ** | **Carrying  Amounts**           | ** ** | **Fair  Value**                 | ** ** | **Carrying  Amounts** | ** ** | **Fair  Value** | ** ** |
| Mortgages and  notes receivable |       | $                               | 4,412      |                            | $          | 4,435 |   | $ | 795 |   | $ | 845 |   |
| Mortgages payable               |       | 448,910                         |       | 447,078                         |       | 433,653 |   | 436,463 |   |
| Notes payable                   |       | 1,166,950                       |       | 1,181,164                       |       | 968,347 |   | 998,872 |   |
| Credit Agreements               |       | 191,000                         |       | 191,000                         |       | 215,000 |   | 215,505 |   |
|                                 |            |                                 |            |                                 |            |  |  |  |  |  |  |  |  |

 

**16. Commitments andContingencies**

*General*

The Company is notpresently involved in any material litigation arising outside the ordinarycourse of its business. However, the Company is involved in routine litigationarising in the ordinary course of business, none of which is believed to bematerial in light of reserves taken by the Company. In connection with aspecific tenant litigation, and based upon certain rulings occurring during thethird quarter of 2005, the Company has increased its previously taken reserveby an additional $2.5 million, for an aggregate reserve of approximately $4.8million as of December 31, 2006. Given the increase in the reserve takenby the Company, and the current status of the tenant litigation, the Companybelieves that any loss in excess of the established reserve would beimmaterial.

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

*Funding Commitments*

In addition to thejoint venture funding commitments described in Note 8 above, the Company alsohad the following contractual obligations as of December 31, 2006, none ofwhich the Company believes will have a material adverse affect on the Company’soperations:

·       *Letters of Credit*. The Company has arranged for theprovision of seven separate letters of credit in connection with certainproperty or insurance related matters. If these letters of credit are drawn,the Company will be obligated to reimburse the providing bank for the amount ofthe draw. As of December 31, 2006, there was no balance outstanding underany of the letters of credit. If the letters of credit were fully drawn, thecombined maximum amount of exposure would be approximately $12.7 million.

·       *Non-Recourse Debt Guarantees*. Under certain Company andjoint venture non-recourse mortgage loans, the Company could, under certaincircumstances, be responsible for portions of the mortgage indebtedness inconnection with certain customary non-recourse carve-out provisions such asenvironmental conditions, misuse of funds and material misrepresentations. Asof December 31, 2006, the Company had mortgage loans outstanding ofapproximately $448.9 million and unconsolidated joint ventures in which theCompany has a direct or indirect interest had mortgage loans outstanding ofapproximately $1.9 billion. In addition, the Company has guaranteed certainconstruction and other obligations relative to certain joint venturedevelopment projects; however, the Company does not expect its obligationsunder such guarantees will be material if called upon.

·       *LeasingCommitments*. The Company has entered into leases, as lessee, inconnection with ground leases for shopping centers which it operates andadministrative space for the Company. These leases are accounted for asoperating leases. The minimum annual rental commitments for these leases duringthe next five fiscal years and thereafter are approximately as follows(dollars in thousands):

| **Year**   | ** ** | ** ** | ** ** | ** ** | ** ** |
|------------|------------|------------|------------|------------|------------|
| 2007       |       | $          | 3,474      |       |
| 2008       |       | 3,223      |       |
| 2009       |       | 3,217      |       |
| 2010       |       | 3,193      |       |
| 2011       |       | 3,092      |       |
| Thereafter |       | 41,608     |       |
|            |            |            |            |            |            |  |

 

*Environmental Matters*

Under various federal, state and local laws,ordinances and regulations, the Company may be considered an owner or operatorof real property or may have arranged for the disposal or treatment ofhazardous or toxic substances and, therefore, may become liable for the costsof removal or remediation of certain hazardous substances released on or intheir property or disposed of by them, as well as certain other potential costswhich could relate to hazardous or toxic substances (including governmentalfines and injuries to persons and property). Such liability may be imposedwhether or not the Company knew of, or was responsible for, the presence ofthese hazardous or toxic substances. As is common with community andneighborhood shopping centers, many of the Company’s properties had or haveon-site dry cleaners 

F-46

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

and/or on-site gasolinefacilities. These operations could potentially result in environmentalcontamination at the properties.

The Company is aware thatsoil and groundwater contamination exists at some of its properties. Theprimary contaminants of concern at these properties include perchloroethyleneand trichloroethylene (associated with the operations of on-site dry cleaners)and petroleum hydrocarbons (associated with the operations of on-site gasolinefacilities). The Company is also aware that asbestos-containing materials existat some of its properties. While the Company does not expect the environmentalconditions at its properties, considered as a whole, to have a material adverseeffect on the Company, there can be no assurance that this will be the case. Further,no assurance can be given that any environmental studies performed haveidentified or will identify all material environmental conditions, that anyprior owner of the properties did not create a material environmental conditionnot known to the Company or that a material environmental condition does nototherwise exist with respect to any of the Company’s properties.

**17.  Comprehensive Income**

Total comprehensive income was $132.4 million, $303.3million and $126.1 million for the years ended December 31, 2006, 2005 and2004, respectively. The primary components of comprehensive income, other thannet income, are the adoption and continued application of SFAS No. 133 tothe Company’s cash flow hedges and the Company’s mark-to-market on itsavailable-for-sale securities.

As of December 31,2006 and 2005, accumulated other comprehensive loss reflected in the Company’sstockholders’ equity on the Consolidated Balance Sheets was comprised of thefollowing (dollars in thousands):

| ** **                                                     | ** ** | **As of December 31,** | ** ** |
|----------------------------------------------------------------|------------|---------------------------------------|------------|
| ** **                                                     | ** ** | **2006**                              | ** ** | **2005** | ** ** |
| Realized/unrealized  gains on available-for-sale securities    |       | $                                     | 2,299      |   | $ | 2,040 |   |
| Unrealized gains  on securities held for deferred compensation |       | 170                                   |       | 39 |   |
| Realized gains on  interest hedges                             |       | 1,584                                 |       | 1,751 |   |
| Realized losses  on interest hedges                            |       | (10,302                               | )          | (11,904 | ) |
| Unrealized losses  on interest hedges                          |       | (4,601                                | )          | — |   |
| Accumulated other  comprehensive loss                          |       | $                                     | (10,850    | ) | $ | (8,074 | ) |

 

**18. Future MinimumAnnual Base Rents**

Futureminimum annual base rental revenue for the next five years for the commercialreal estate owned at December 31, 2006 and subject to non-cancelableoperating leases is as follows (in thousands):

| **Year**   | ** ** | ** ** | ** ** | ** ** | ** ** |
|------------|------------|------------|------------|------------|------------|
| 2007       |       | $          | 427,586    |       |
| 2008       |       | 377,343    |       |
| 2009       |       | 320,555    |       |
| 2010       |       | 267,708    |       |
| 2011       |       | 218,651    |       |
| Thereafter |       | 895,024    |       |
|            |            |            |            |            |            |  |

 

F-47

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**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)**

The above table assumesthat all leases which expire are not renewed and tenant renewal options are notexercised, therefore neither renewal rentals nor rentals from replacement tenantsare included. Future minimum annual base rentals do not include contingentrentals, which may be received under certain leases on the basis of percentageof reported tenants’ sales volume, increases in consumer price indices, commonarea maintenance charges and real estate tax reimbursements. Contingent rentalsfor the years ended December 31, 2006, 2005 and 2004 amounted toapproximately $110.2 million, $109.7 million and $107.7 million, respectively.

**19. Retirement Plan**

The Company has aRetirement and 401(k) Savings Plan (the “Savings Plan”) covering officersand employees of the Company. Participants in the Savings Plan may elect tocontribute a portion of their earnings to the Savings Plan and the Companymakes a matching contribution to the Savings Plan to a maximum of 3% of theemployee’s eligible compensation. For the years ended December 31, 2006,2005 and 2004, the Company’s expense for the Savings Plan was approximately$0.7 million, $0.6 million and $0.5 million, respectively.

**20. Selected QuarterlyFinancial Data (Unaudited)**

Summarizedquarterly financial data is as follows (in thousands, except per shareamounts):

| ** **                              | ** ** | **Total  Revenues (1)** | ** ** | **Net Income** | ** ** | **Net Income Per   Share-Basic** | ** ** | **Net Income Per   Share-Diluted** | ** ** |
|-----------------------------------------|------------|------------------------------|------------|---------------------|------------|-------------------------------------------------|------------|---------------------------------------------------|------------|
| **Year  Ended December 31, 2006:** |       |                         |       |                |       |                                            |       |                                              |       |   |   |   |   |   |   |   |   |
| First quarter                           |       |                         | $          | 114,475             |       |                                            |       | $                                                 | 38,509     |   |   |   | $ | 0.32 |   |   |   | $ | 0.31 |   |   |
| Second quarter                          |       |                         | 111,692    |                |       |                                            | 34,669     |                                              |       |   | 0.28 |   |   |   | 0.27 |   |   |
| Third quarter                           |       |                         | 113,710    |                |       |                                            | 33,182     |                                              |       |   | 0.26 |   |   |   | 0.25 |   |   |
| Fourth quarter                          |       |                         | 117,099    |                |       |                                            | 28,857     |                                              |       |   | 0.23 |   |   |   | 0.22 |   |   |
| **Year Ended December 31, 2005:**  |       |                         |       |                |       |                                            |       |                                              |       |   |   |   |   |   |   |   |   |
| First quarter                           |       |                         | 124,770    |                |       |                                            | $          | 38,687                                            |       |   |   | $ | 0.32 |   |   |   | $ | 0.32 |   |   |
| Second quarter                          |       |                         | 127,773    |                |       |                                            | 40,697     |                                              |       |   | 0.34 |   |   |   | 0.33 |   |   |
| Third quarter                           |       |                         | 112,133    |                |       |                                            | 196,045    |                                              |       |   | 1.84 |   |   |   | 1.82 |   |   |
| Fourth quarter                          |       |                         | 108,615    |                |       |                                            | 30,895     |                                              |       |   | 0.24 |   |   |   | 0.24 |   |   |
| **Year Ended December 31, 2004:**  |       |                         |       |                |       |                                            |       |                                              |       |   |   |   |   |   |   |   |   |
| First quarter                           |       |                         | $          | 118,026             |       |                                            |       | $                                                 | 37,397     |   |   |   | $ | 0.32 |   |   |   | $ | 0.32 |   |   |
| Second quarter                          |       |                         | 115,669    |                |       |                                            | 32,916     |                                              |       |   | 0.28 |   |   |   | 0.27 |   |   |
| Third quarter                           |       |                         | 116,696    |                |       |                                            | 29,441     |                                              |       |   | 0.24 |   |   |   | 0.23 |   |   |
| Fourth quarter                          |       |                         | 120,716    |                |       |                                            | 34,186     |                                              |       |   | 0.28 |   |   |   | 0.27 |   |   |

----

(1)          Amountshave been adjusted to give effect to the Company’s discontinued operations, inaccordance with SFAS No. 144.

F-48

----

**NEWPLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES**

**SCHEDULEII—VALUATION AND QUALIFYING ACCOUNTS(in thousands)**

| ** **                         | ** ** | ** **                                     | ** ** | **Additions**                               | ** ** | **Deductions**                             | ** ** | ** **                               | ** ** |
|------------------------------------|------------|------------------------------------------------|------------|---------------------------------------------|------------|--------------------------------------------|------------|------------------------------------------|------------|
| ** **                         | ** ** | **Balance at  Beginning of  Period** | ** ** | **Charged to  Bad Debt  Expense** | ** ** | **Accounts  Receivable  Written Off** | ** ** | **Balance at  End of  Period** | ** ** |
| Allowance for doubtful  accounts:  |       |                                           |       |                                        |       |                                       |       |                                     |       |   |   |   |   |   |   |   |   |
| Year ended December 31, 2006  |       |                                           | $          | 27,540                                      |       |                                       |       | $                                        | (5,415     | ) |   |   | $( 2,739 | ) |   |   | $ | 19,386 |   |   |
| Year ended December 31, 2005  |       |                                           | $          | 24,239                                      |       |                                       |       | $                                        | 7,407      |   |   |   | $ | (4,106 | ) |   |   | $ | 27,540 |   |   |
| Year ended  December 31, 2004 |       |                                           | $          | 16,950                                      |       |                                       |       | $                                        | 7,642      |   |   |   | $ | (353 | ) |   |   | $ | 24,239 |   |   |

 

| ** **                         | ** ** | ** **                                     | ** ** | **Additions**                | ** ** | **Deductions**       | ** ** | ** **                               | ** ** |
|------------------------------------|------------|------------------------------------------------|------------|------------------------------|------------|----------------------|------------|------------------------------------------|------------|
| ** **                         | ** ** | **Balance at  Beginning of  Period** | ** ** | **Charged to  Expense** | ** ** | **Written Off** | ** ** | **Balance at  End of  Period** | ** ** |
| Reserve for  straight-line rents:  |       |                                           |       |                         |       |                 |       |                                     |       |   |   |   |   |   |   |   |   |
| Year ended December 31, 2006  |       |                                           | $          | 1,592                        |       |                 |       | $                                        | 1,449      |   |   |   | $ | (1,339 | ) |   |   | $ | 1,702 |   |   |
| Year ended December 31, 2005  |       |                                           | $          | 3,548                        |       |                 |       | $                                        | (635       | ) |   |   | $ | (1,321 | ) |   |   | $ | 1,592 |   |   |
| Year ended  December 31, 2004 |       |                                           | $          | 5,445                        |       |                 |       | $                                        | (22        | ) |   |   | $ | (1,875 | ) |   |   | $ | 3,548 |   |   |

 

F-49

----

**NEWPLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES**

**SCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATION**

**December31, 2006**

| **COLUMN A** | ** ** | **COLUMN B** | ** ** | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**     | ** ** |
|-------------------|------------|-------------------|------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------|------------|
| ** **        | ** ** | ** **        | ** ** | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | **Life on Which** | ** ** |
| ** **        | ** ** | ** **        | ** ** | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—** | ** ** |
| ** **        | ** ** | ** **        | ** ** | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**       | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**   | ** ** | ** **        | ** ** | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**             | ** ** | **Depreciation** | ** ** | **  Constructed  ** | ** ** | **    Acquired    ** | ** ** | **Statement** | ** ** |
| **Retail**        | ** ** | ** **        | ** ** | ** **                                 | ** ** | ** **              | ** ** | ** **                                              | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** |
|                   |            |                   |            |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                       |            |  |  |  |  |  |  |  |  |

| Riverview Plaza  Gadsden, AL       |   |   | $          | (4,012,042 | )      |       | $      | 2,072,169 |       |   | $      | 8,286,847 |      |   |   | $          | 91,626 |   |       | $      | 2,072,169 |       |   | $      | 8,378,473  |   |   | $      | 10,450,642 |   |   | $      | (1,732,460 | )      |   |   | 2007      |   |   |   | Oct-95 |   |   |   | 40 years |   |   |
|------------------------------------|--------|--------|------------|------------|--------|------------|--------|-----------|------------|--------|--------|-----------|-----------|--------|--------|------------|--------|--------|------------|--------|-----------|------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|-----------|--------|--------|--------|--------|--------|--------|--------|---------------|--------|--------|
| Grants Mill Station  Irondale, AL  |   |   |       |       |   | 2,888,819  |   |      | 11,555,308 |   |   |      | 271,476   |   |   | 2,888,819  |   |   | 11,826,784 |   |      | 14,715,602 |   |   | (2,448,921 | )      |   |   | 1991       |   |   |   | Jul-98     |   |   |   | 40  years |   |   |
| Kroger  Muscle Shoals, AL          |   |   |       |       |   | 429,999    |   |      | 1,659,638  |   |   |      |      |   |   | 429,999    |   |   | 1,659,638  |   |      | 2,089,637  |   |   | (344,962   | )      |   |   | 1982       |   |   |   | Aug-93     |   |   |   | 40  years |   |   |
| Kroger  Muscle Shoals, AL          |   |   |       |       |   | 102,822    |   |      | 396,597    |   |   |      |      |   |   | 102,822    |   |   | 396,597    |   |      | 499,419    |   |   | (82,778    | )      |   |   | 1982       |   |   |   | Aug-93     |   |   |   | 40  years |   |   |
| Kroger  Scottsboro, AL             |   |   |       |       |   | 369,815    |   |      | 1,427,451  |   |   |      |      |   |   | 369,815    |   |   | 1,427,451  |   |      | 1,797,266  |   |   | (296,800   | )      |   |   | 1982       |   |   |   | Aug-93     |   |   |   | 40  years |   |   |
| Payton Park  Sylacauga, AL         |   |   |       |       |   | 3,584,697  |   |      | 14,339,021 |   |   |      | 78,679    |   |   | 3,584,697  |   |   | 14,417,700 |   |      | 18,002,397 |   |   | (2,991,802 | )      |   |   | 1995       |   |   |   | Jul-98     |   |   |   | 40  years |   |   |
| Country Market  Pine Bluff, AR     |   |   |       |       |   | 490,287    |   |      | 1,892,538  |   |   |      | 43,957    |   |   | 490,287    |   |   | 1,936,496  |   |      | 2,426,783  |   |   | (402,541   | )      |   |   | 1981       |   |   |   | Aug-93     |   |   |   | 40  years |   |   |
| Broadway Mesa  Mesa, AZ            |   |   |       |       |   | 1,147,194  |   |      | 4,588,778  |   |   |      | 438,053   |   |   | 1,147,194  |   |   | 5,026,830  |   |      | 6,174,025  |   |   | (1,161,600 | )      |   |   | 1985       |   |   |   | Dec-90     |   |   |   | 40  years |   |   |
| Metro Marketplace  Phoenix, AZ     |   |   |       |       |   | 5,098,702  |   |      | 20,521,995 |   |   |      | 206,193   |   |   | 5,098,702  |   |   | 20,728,189 |   |      | 25,826,891 |   |   | (4,720,530 | )      |   |   | 2001       |   |   |   | Jun-91     |   |   |   | 40  years |   |   |
| Northmall Centre  Tucson, AZ       |   |   |       |       |   | 4,762,481  |   |      | 12,630,121 |   |   |      | 191,944   |   |   | 4,762,481  |   |   | 12,822,065 |   |      | 17,584,546 |   |   | (2,963,874 | )      |   |   | 1996       |   |   |   | Dec-96     |   |   |   | 40  years |   |   |
| Bakersfield Plaza  Bakersfield, CA |   |   |       |       |   | (28,534    | )      |      | 27,597,943 |   |   |      | 236,776   |   |   | (28,534    | )      |   | 27,834,719 |   |      | 27,806,186 |   |   | (5,707,899 | )      |   |   | 2007       |   |   |   | Jun-97     |   |   |   | 40  years |   |   |
| Burbank Plaza  Burbank, CA         |   |   |       |       |   | 1,153,334  |   |      | 4,613,209  |   |   |      | 54,925    |   |   | 1,153,334  |   |   | 4,668,134  |   |      | 5,821,468  |   |   | (1,077,829 | )      |   |   | 1988       |   |   |   | May-89     |   |   |   | 40  years |   |   |
| Carmen Plaza  Camarillo, CA        |   |   |       |       |   | 1,872,708  |   |      | 7,491,044  |   |   |      | 847,703   |   |   | 1,872,708  |   |   | 8,338,747  |   |      | 10,211,455 |   |   | (2,271,328 | )      |   |   | 2000       |   |   |   | Jun-97     |   |   |   | 40  years |   |   |
| Cudahy Plaza  Cudahy, CA           |   |   |       |       |   |       |   |      | 10,019,146 |   |   |      | 165,187   |   |   |       |   |   | 10,184,333 |   |      | 10,184,333 |   |   | (2,035,086 | )      |   |   | 1994       |   |   |   | Jun-97     |   |   |   | 40  years |   |   |
| Arbor Faire  Fresno, CA            |   |   |       |       |   | 4,378,813  |   |      | 17,624,497 |   |   |      | 526,132   |   |   | 4,378,813  |   |   | 18,150,629 |   |      | 22,529,442 |   |   | (3,702,389 | )      |   |   | 1993       |   |   |   | Apr-97     |   |   |   | 40  years |   |   |
| Broadway Faire  Fresno, CA         |   |   |       |       |   | 2,795,383  |   |      | 11,181,648 |   |   |      | 51,328    |   |   | 2,795,383  |   |   | 11,232,976 |   |      | 14,028,359 |   |   | (2,302,169 | )      |   |   | 1995       |   |   |   | Apr-97     |   |   |   | 40  years |   |   |
| Briggsmore Plaza  Modesto, CA      |   |   | (725       | )          |   | 1,663,885  |   |      | 6,653,828  |   |   |      | 254,163   |   |   | 1,663,885  |   |   | 6,907,991  |   |      | 8,571,876  |   |   | (1,517,231 | )      |   |   | 1998       |   |   |   | Jun-97     |   |   |   | 40  years |   |   |
| Montebello Plaza  Montebello, CA   |   |   | (267,441   | )          |   | 5,808,350  |   |      | 23,231,144 |   |   |      | 415,812   |   |   | 5,808,350  |   |   | 23,646,956 |   |      | 29,455,306 |   |   | (5,291,990 | )      |   |   | 1996       |   |   |   | Jun-97     |   |   |   | 40  years |   |   |
| Metro 580  Pleasanton, CA          |   |   |       |       |   | 5,876,389  |   |      | 23,651,921 |   |   |      | 2,485,628 |   |   | 5,876,389  |   |   | 26,137,549 |   |      | 32,013,938 |   |   | (5,198,624 | )      |   |   | 2004       |   |   |   | Sep-97     |   |   |   | 40  years |   |   |
| Rose Pavilion  Pleasanton, CA      |   |   |       |       |   | 11,389,328 |   |      | 45,840,252 |   |   |      | 3,221,541 |   |   | 11,389,328 |   |   | 49,061,793 |   |      | 60,451,121 |   |   | (9,854,792 | )      |   |   | 2005       |   |   |   | Feb-98     |   |   |   | 40  years |   |   |
| Bristol Plaza  Santa Ana, CA       |   |   |       |       |   |       |   |      | 15,222,022 |   |   |      | 4,740,430 |   |   |       |   |   | 19,962,452 |   |      | 19,962,452 |   |   | (3,349,563 | )      |   |   | 2003       |   |   |   | Jun-97     |   |   |   | 40  years |   |   |
| Arvada Plaza  Arvada, CO           |   |   | (2,070,757 | )          |   | 1,214,994  |   |      | 3,820,483  |   |   |      |      |   |   | 1,214,994  |   |   | 3,820,483  |   |      | 5,035,478  |   |   | (385,802   | )      |   |   | 1994       |   |   |   | Dec-02     |   |   |   | 40  years |   |   |

** **

F-50

----

**NEWPLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES**

**SCHEDULEIII—REAL ESTATE AND ACCUMULATED DEPRECIATION**

**December31, 2006**

| **COLUMN A**                          | ** ** | **COLUMN B** | ** ** | **COLUMN C**                          | ** ** | **COLUMN D**      | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G** | ** ** | **COLUMN H**       | ** ** | **COLUMN I**     | ** ** |
|--------------------------------------------|------------|-------------------|------------|--------------------------------------------|------------|------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------|------------|-------------------------|------------|-----------------------|------------|
| ** **                                 | ** ** | ** **        | ** ** | ** **                                 | ** ** | ** **             | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **        | ** ** | ** **              | ** ** | ** **            | ** ** | **Life on Which** | ** ** |
| ** **                                 | ** ** | ** **        | ** ** | **Initial Cost to Company** | ** ** | **Subsequent to** | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **        | ** ** | ** **              | ** ** | **Depreciated—** | ** ** |
| ** **                                 | ** ** | ** **        | ** ** | ** **                                 | ** ** | ** **             | ** ** | **Building &**                                 | ** ** | **Acquisition**                                       | ** ** | ** **        | ** ** | **Building &** | ** ** | ** **            | ** ** | **Accumulated** | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**                            | ** ** | ** **        | ** ** | **Encumbrances**                           | ** ** | **Land**               | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**          | ** ** | **Improvements**        | ** ** | **Total**             | ** ** | **Depreciation** | ** ** | **Constructed** | ** ** | **Acquired** | ** ** | **Statement** | ** ** |
| Superior Marketplace  Superior, CO         |       |              |       |                                       |       | 23,433,974             |       |                                                    | 15,637,888 |                                                  |       |              | 15,187,180 |                    |       | 23,433,974            |       |   | 30,825,069 |   |   | 54,259,042 |   |   | (2,561,552 | ) |   |   | 2004 |   |   |   | Jul-02 |   |   |   | 40  years |   |   |
| Doverama at Rodney  Dover, DE              |       |              |       |                                       |       | 50,755                 |       |                                                    | 311,781    |                                                  |       |              |       |                    |       | 50,755                |       |   | 311,781 |   |   | 362,536 |   |   | (141,943 | ) |   |   | 1959 |   |   |   | Jan-69 |   |   |   | 40  years |   |   |
| Brooksville Square  Brooksville, FL        |       |              |       |                                       |       | 1,503,243              |       |                                                    | 7,874,334  |                                                  |       |              | 262,976    |                    |       | 1,503,243             |       |   | 8,137,309 |   |   | 9,640,553 |   |   | (2,340,575 | ) |   |   | 2006 |   |   |   | Mar-94 |   |   |   | 40  years |   |   |
| Clearwater Mall  Clearwater, FL            |       |              |       |                                       |       | 9,524,335              |       |                                                    | 30,919,809 |                                                  |       |              | 3,317,830  |                    |       | 9,524,335             |       |   | 34,237,638 |   |   | 43,761,973 |   |   | (2,348,099 | ) |   |   | 2003 |   |   |   | Jan-04 |   |   |   | 40  years |   |   |
| Coconut Creek  Coconut Creek, FL           |       |              |       |                                       |       | 16,222,504             |       |                                                    | 9,021,223  |                                                  |       |              | 441,370    |                    |       | 16,222,504            |       |   | 9,462,593 |   |   | 25,685,097 |   |   | (1,694,845 | ) |   |   | 2005 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Northgate S.C.  DeLand, FL                 |       |              | (5,180,996 | )                                          |       | 2,957,640              |       |                                                    | 11,830,664 |                                                  |       |              | 185,124    |                    |       | 2,957,640             |       |   | 12,015,788 |   |   | 14,973,428 |   |   | (2,463,058 | ) |   |   | 1993 |   |   |   | Jun-93 |   |   |   | 40  years |   |   |
| Sun Plaza  Ft. Walton Beach, FL            |       |              | (9,208,234 | )                                          |       | 3,356,305              |       |                                                    | 10,571,344 |                                                  |       |              | 2,921,335  |                    |       | 3,356,305             |       |   | 13,492,679 |   |   | 16,848,985 |   |   | (1,173,092 | ) |   |   | 2004 |   |   |   | Dec-02 |   |   |   | 40  years |   |   |
| Regency Park  Jacksonville, FL             |       |              |       |                                       |       | 3,888,425              |       |                                                    | 15,553,501 |                                                  |       |              | 4,340,960  |                    |       | 3,888,425             |       |   | 19,894,461 |   |   | 23,782,886 |   |   | (4,257,548 | ) |   |   | 2006 |   |   |   | Jun-97 |   |   |   | 40  years |   |   |
| The Shoppes at Southside  Jacksonville, FL |       |              |       |                                       |       | 5,040,765              |       |                                                    | 19,591,340 |                                                  |       |              | 9,914      |                    |       | 5,040,765             |       |   | 19,601,254 |   |   | 24,642,020 |   |   | (1,164,746 | ) |   |   | 2004 |   |   |   | Dec-04 |   |   |   | 40  years |   |   |
| Plaza 66  Kenneth City, FL                 |       |              |       |                                       |       | 1,618,156              |       |                                                    | 4,854,469  |                                                  |       |              | 9,800      |                    |       | 1,618,156             |       |   | 4,864,269 |   |   | 6,482,425 |   |   | (491,083 | ) |   |   | 1995 |   |   |   | Dec-02 |   |   |   | 40  years |   |   |
| Ventura Downs  Kissimmee, FL               |       |              |       |                                       |       | 2,390,906              |       |                                                    | 8,670,437  |                                                  |       |              | 29,346     |                    |       | 2,390,906             |       |   | 8,699,783 |   |   | 11,090,689 |   |   | (63,268 | ) |   |   | 2005 |   |   |   | Nov-06 |   |   |   | 40  years |   |   |
| Leesburg Square  Leesburg, FL              |       |              |       |                                       |       | 1,051,639              |       |                                                    | 4,206,554  |                                                  |       |              | 211,142    |                    |       | 1,051,639             |       |   | 4,417,696 |   |   | 5,469,335 |   |   | (960,730 | ) |   |   | 1986 |   |   |   | Dec-92 |   |   |   | 40  years |   |   |
| Miami Gardens  Miami, FL                   |       |              |       |                                       |       | 5,418,459              |       |                                                    | 22,098,501 |                                                  |       |              | 192,956    |                    |       | 5,418,459             |       |   | 22,291,457 |   |   | 27,709,916 |   |   | (4,576,551 | ) |   |   | 1996 |   |   |   | Oct-97 |   |   |   | 40  years |   |   |
| The Mall at 163rd Street  Miami, FL        |       |              |       |                                       |       | 5,275,704              |       |                                                    | 4,863,782  |                                                  |       |              | 32,949,581 |                    |       | 5,275,704             |       |   | 37,813,363 |   |   | 43,089,067 |   |   | (452,947 | ) |   |   | 2007 |   |   |   | Dec-98 |   |   |   | 40 years |   |   |

 

F-51

----

**NEWPLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES**

**SCHEDULEIII—REAL ESTATE AND ACCUMULATED DEPRECIATION**

**December31, 2006**
| COLUMN A        | ** ** | **COLUMN B** | ** ** | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**     | ** ** |
|----------------------|------------|-------------------|------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------|------------|
| ** **           | ** ** | ** **        | ** ** | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | **Life on Which** | ** ** |
| ** **           | ** ** | ** **        | ** ** | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—** | ** ** |
| ** **           | ** ** | ** **        | ** ** | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**       | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**      | ** ** | ** **        | ** ** | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**             | ** ** | **Depreciation** | ** ** | **Constructed** | ** ** | **Acquired** | ** ** | **Statement** | ** ** |
| Freedom Square       |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Naples, FL           |       |              |       |                                       |       | 3,340,254               |       |                                                    | 13,361,049 |                                                  |       |                    | 119,810    |              |       | 3,340,254             |       |   | 13,480,858 |   |   | 16,821,112 |   |   | (2,815,680 | ) |   |   | 1995 |   |   |   | Oct-97 |   |   |   | 40 years |   |   |
| Southgate            |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| New Port Richey, FL  |       |              |       |                                       |       | 4,253,341               |       |                                                    | 3,981,290  |                                                  |       |                    | 7,190,295  |              |       | 4,253,341             |       |   | 11,171,584 |   |   | 15,424,925 |   |   | (1,418,138 | ) |   |   | 2004 |   |   |   | Aug-97 |   |   |   | 40 years |   |   |
| Presidential Plaza   |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| North Lauderdale, FL |       |              |       |                                       |       | 1,750,441               |       |                                                    | 3,269,390  |                                                  |       |                    | 675,948    |              |       | 1,750,441             |       |   | 3,945,338 |   |   | 5,695,779 |   |   | (940,207 | ) |   |   | 2006 |   |   |   | Apr-97 |   |   |   | 40 years |   |   |
| Colonial Marketplace |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Orlando, FL          |       |              |       |                                       |       | 3,426,817               |       |                                                    | 3,504,446  |                                                  |       |                    | 6,558,794  |              |       | 3,426,817             |       |   | 10,063,240 |   |   | 13,490,057 |   |   | (1,168,806 | ) |   |   | 2006 |   |   |   | Apr-98 |   |   |   | 40 years |   |   |
| Pointe*Orlando       |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Orlando, FL          |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    | 257,830    |              |       |                  |       |   | 257,830 |   |   | 257,830 |   |   |   |   |   |   | 2007 |   |   |   | Nov-99 |   |   |   | 40 years |   |   |
| 23rd Street Station  |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Panama City, FL      |       |              |       |                                       |       | 1,849,668               |       |                                                    | 7,398,843  |                                                  |       |                    | 331,619    |              |       | 1,849,668             |       |   | 7,730,462 |   |   | 9,580,130 |   |   | (1,616,506 | ) |   |   | 1995 |   |   |   | Jul-98 |   |   |   | 40 years |   |   |
| Pensacola Square     |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Pensacola, FL        |       |              |       |                                       |       | 3,536,164               |       |                                                    | 10,608,491 |                                                  |       |                    | 609,119    |              |       | 3,536,164             |       |   | 11,217,610 |   |   | 14,753,774 |   |   | (1,074,220 | ) |   |   | 1995 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Seminole Plaza       |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Seminole, FL         |       |              |       |                                       |       | 2,033,780               |       |                                                    | 2,204,597  |                                                  |       |                    | 150,392    |              |       | 2,033,780             |       |   | 2,354,989 |   |   | 4,388,769 |   |   | (854,430 | ) |   |   | 1995 |   |   |   | Jun-98 |   |   |   | 40 years |   |   |
| Eagles Park          |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| St. Petersburg, FL   |       |              |       |                                       |       | 2,804,604               |       |                                                    | 5,527,812  |                                                  |       |                    | 26,591     |              |       | 2,804,604             |       |   | 5,554,403 |   |   | 8,359,007 |   |   | (814,889 | ) |   |   | 1986 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Rutland Plaza        |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| St. Petersburg, FL   |       |              |       |                                       |       | 1,443,294               |       |                                                    | 5,773,175  |                                                  |       |                    | 1,125,273  |              |       | 1,443,294             |       |   | 6,898,448 |   |   | 8,341,742 |   |   | (1,768,413 | ) |   |   | 2002 |   |   |   | Nov-96 |   |   |   | 40 years |   |   |
| Skyway Plaza         |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| St. Petersburg, FL   |       |              | (3,391,893 | )                                          |       | 1,859,960               |       |                                                    | 5,579,881  |                                                  |       |                    | 94,677     |              |       | 1,859,960             |       |   | 5,674,558 |   |   | 7,534,519 |   |   | (670,075 | ) |   |   | 2002 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Tyrone Gardens       |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| St. Petersburg, FL   |       |              | (8,885,331 | )                                          |       | 2,811,942               |       |                                                    | 16,046,158 |                                                  |       |                    |       |              |       | 2,811,942             |       |   | 16,046,158 |   |   | 18,858,100 |   |   | (403,168 | ) |   |   | 1998 |   |   |   | Jun-06 |   |   |   | 40 years |   |   |
| Downtown Publix      |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Stuart, FL           |       |              |       |                                       |       | 5,431,541               |       |                                                    | 5,906,376  |                                                  |       |                    | 353,388    |              |       | 5,431,541             |       |   | 6,259,764 |   |   | 11,691,305 |   |   | (1,092,343 | ) |   |   | 2000 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Tarpon Mall          |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Tarpon Springs, FL   |       |              |       |                                       |       | 4,097,649               |       |                                                    | 8,866,946  |                                                  |       |                    | 2,570,468  |              |       | 4,097,649             |       |   | 11,437,415 |   |   | 15,535,064 |   |   | (1,054,522 | ) |   |   | 2003 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Northeast Plaza      |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Atlanta, GA          |       |              |       |                                       |       | 5,577,118               |       |                                                    | 16,731,354 |                                                  |       |                    | 4,763,759  |              |       | 5,577,118             |       |   | 21,495,113 |   |   | 27,072,231 |   |   | (1,948,513 | ) |   |   | 2004 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Sweetwater Village   |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Austell, GA          |       |              |       |                                       |       | 707,938                 |       |                                                    | 2,831,750  |                                                  |       |                    | 139,937    |              |       | 707,938               |       |   | 2,971,687 |   |   | 3,679,624 |   |   | (909,862 | ) |   |   | 1985 |   |   |   | Oct-94 |   |   |   | 40 years |   |   |
| Cedar Plaza          |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cedartown, GA        |       |              |       |                                       |       | 905,977                 |       |                                                    | 3,713,207  |                                                  |       |                    | 272,211    |              |       | 905,977               |       |   | 3,985,417 |   |   | 4,891,394 |   |   | (1,186,254 | ) |   |   | 1994 |   |   |   | Oct-94 |   |   |   | 40 years |   |   |
| Covered Bridge       |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Clayton, GA          |       |              | (2,519,462 | )                                          |       | 937,028                 |       |                                                    | 2,811,085  |                                                  |       |                    | 166,235    |              |       | 937,028               |       |   | 2,977,319 |   |   | 3,914,348 |   |   | (303,523 | ) |   |   | 2001 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Habersham Crossing   |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cornelia, GA         |       |              | (3,496,798 | )                                          |       | 1,644,936               |       |                                                    | 6,580,461  |                                                  |       |                    | 94,303     |              |       | 1,644,936             |       |   | 6,674,763 |   |   | 8,319,699 |   |   | (1,447,739 | ) |   |   | 1990 |   |   |   | Mar-96 |   |   |   | 40 years |   |   |
| Covington Gallery    |       |              |       |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Covington, GA        |       |              |       |                                       |       | 2,494,987               |       |                                                    | 9,979,830  |                                                  |       |                    | 470,933    |              |       | 2,494,987             |       |   | 10,450,763 |   |   | 12,945,749 |   |   | (2,125,743 | ) |   |   | 1991 |   |   |   | Dec-93 |   |   |   | 40  years |   |   |
|                      |            |                   |            |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                       |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

F-52

----

**NEWPLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES**

**SCHEDULEIII—REAL ESTATE AND ACCUMULATED DEPRECIATION**

**December31, 2006**
| COLUMN A             | ** ** | **COLUMN B** | ** **  | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN**            | ** ** |
|---------------------------|------------|-------------------|-------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------|------------|
| ** **                | ** ** | ** **        | ** **  | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | **Life on Which** | ** ** |
| ** **                | ** ** | ** **        | ** **  | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—** | ** ** |
| ** **                | ** ** | ** **        | ** **  | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**       | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**           | ** ** | ** **        | ** **  | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**             | ** ** | **Depreciation** | ** ** | **Constructed** | ** ** | **Acquired** | ** ** | **Statement** | ** ** |
| Midway Village            |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Douglasville, GA          |       |              |        |                                       |       | 1,553,580               |       |                                                    | 2,887,506  |                                                  |       |                    | 151,181    |              |       | 1,553,580             |       |   | 3,038,687 |   |   | 4,592,267 |   |   | (761,309 | ) |   |   | 1989 |   |   |   | May-97 |   |   |   | 40 years |   |   |
| Westgate                  |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Dublin, GA                |       |              |        |                                       |       | 1,406,062               |       |                                                    | 3,617,277  |                                                  |       |                    | 2,385,427  |              |       | 1,406,062             |       |   | 6,002,705 |   |   | 7,408,767 |   |   | (1,954,069 | ) |   |   | 2004 |   |   |   | Jul-90 |   |   |   | 40 years |   |   |
| Mableton Walk             |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Mableton, GA              |       |              |        |                                       |       | 2,136,994               |       |                                                    | 8,923,974  |                                                  |       |                    | 33,827     |              |       | 2,136,994             |       |   | 8,957,802 |   |   | 11,094,796 |   |   | (466,077 | ) |   |   | 1994 |   |   |   | Jun-05 |   |   |   | 40 years |   |   |
| Marshalls at Eastlake     |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Marietta, GA              |       |              |        |                                       |       | 1,710,517               |       |                                                    | 2,074,698  |                                                  |       |                    | 73,271     |              |       | 1,710,517             |       |   | 2,147,969 |   |   | 3,858,486 |   |   | (484,277 | ) |   |   | 1982 |   |   |   | Oct-98 |   |   |   | 40 years |   |   |
| New Chastain Corners      |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Marietta, GA              |       |              |        |                                       |       | 2,457,446               |       |                                                    | 5,741,641  |                                                  |       |                    | 483,966    |              |       | 2,457,446             |       |   | 6,225,607 |   |   | 8,683,054 |   |   | (1,547,271 | ) |   |   | 2004 |   |   |   | Jul-97 |   |   |   | 40 years |   |   |
| Pavilions at Eastlake     |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Marietta, GA              |       |              |        |                                       |       | 2,812,000               |       |                                                    | 11,249,970 |                                                  |       |                    | 429,192    |              |       | 2,812,000             |       |   | 11,679,162 |   |   | 14,491,162 |   |   | (2,444,023 | ) |   |   | 1996 |   |   |   | Mar-99 |   |   |   | 40 years |   |   |
| Village at Southlake      |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Morrow, GA                |       |              |        |                                       |       | 1,733,198               |       |                                                    | 3,017,677  |                                                  |       |                    | 59,562     |              |       | 1,733,198             |       |   | 3,077,239 |   |   | 4,810,437 |   |   | (778,541 | ) |   |   | 1983 |   |   |   | Apr-98 |   |   |   | 40 years |   |   |
| Merchants Crossing        |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Newnan, GA                |       |              | (5,065,196  | )                                          |       | 2,077,145               |       |                                                    | 6,231,434  |                                                  |       |                    | 1,498      |              |       | 2,077,145             |       |   | 6,232,933 |   |   | 8,310,077 |   |   | (629,004 | ) |   |   | 2007 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Creekwood Shopping Center |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Rex, GA                   |       |              |        |                                       |       | 1,160,203               |       |                                                    | 3,482,609  |                                                  |       |                    | 137,211    |              |       | 1,160,203             |       |   | 3,619,820 |   |   | 4,780,022 |   |   | (854,010 | ) |   |   | 1990 |   |   |   | May-97 |   |   |   | 40 years |   |   |
| Shops of Riverdale        |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Riverdale, GA             |       |              |        |                                       |       | 1,523,058               |       |                                                    | 1,271,713  |                                                  |       |                    | 27,913     |              |       | 1,523,058             |       |   | 1,299,626 |   |   | 2,822,683 |   |   | (295,944 | ) |   |   | 1995 |   |   |   | Feb-96 |   |   |   | 40 years |   |   |
| Eisenhower Square         |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Savannah, GA              |       |              |        |                                       |       | 1,029,500               |       |                                                    | 4,117,700  |                                                  |       |                    | 488,094    |              |       | 1,029,500             |       |   | 4,605,794 |   |   | 5,635,294 |   |   | (1,248,871 | ) |   |   | 1997 |   |   |   | Jul-97 |   |   |   | 40 years |   |   |
| Victory Square            |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Savannah, GA              |       |              |        |                                       |       | 2,029,618               |       |                                                    | 5,392,846  |                                                  |       |                    | 1,491,250  |              |       | 2,029,618             |       |   | 6,884,096 |   |   | 8,913,714 |   |   | (2,042,819 | ) |   |   | 2007 |   |   |   | Jul-92 |   |   |   | 40 years |   |   |
| University Commons        |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Statesboro, GA            |       |              |        |                                       |       | 1,312,739               |       |                                                    | 5,250,755  |                                                  |       |                    | 15,450     |              |       | 1,312,739             |       |   | 5,266,205 |   |   | 6,578,944 |   |   | (1,078,876 | ) |   |   | 1994 |   |   |   | Jul-96 |   |   |   | 40 years |   |   |
| Stockbridge Village       |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Stockbridge, GA           |       |              |        |                                       |       | 4,331,759               |       |                                                    | 17,800,000 |                                                  |       |                    | 906,677    |              |       | 4,331,759             |       |   | 18,706,677 |   |   | 23,038,436 |   |   | (1,564,182 | ) |   |   | 1991 |   |   |   | Apr-04 |   |   |   | 40 years |   |   |
| Tift-Town                 |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Tifton, GA                |       |              |        |                                       |       | 271,444                 |       |                                                    | 1,325,238  |                                                  |       |                    | 579,076    |              |       | 271,444               |       |   | 1,904,315 |   |   | 2,175,758 |   |   | (810,516 | ) |   |   | 1965 |   |   |   | Jul-90 |   |   |   | 40 years |   |   |
| Kmart                     |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Atlantic, IA              |       |              |        |                                       |       | 293,138                 |       |                                                    | 1,134,513  |                                                  |       |                    |       |              |       | 293,138               |       |   | 1,134,513 |   |   | 1,427,652 |   |   | (235,884 | ) |   |   | 1980 |   |   |   | Jan-94 |   |   |   | 40 years |   |   |
| Haymarket Mall            |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Des Moines, IA            |       |              |        |                                       |       | 1,230,252               |       |                                                    | 5,031,799  |                                                  |       |                    | 1,680,588  |              |       | 1,230,252             |       |   | 6,712,387 |   |   | 7,942,638 |   |   | (2,322,120 | ) |   |   | 2002 |   |   |   | May-95 |   |   |   | 40 years |   |   |
| Annex of Arlington        |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Arlington Heights, IL     |       |              | (19,811,061 | )                                          |       | 8,771,289               |       |                                                    | 21,274,207 |                                                  |       |                    | 184,215    |              |       | 8,771,289             |       |   | 21,458,422 |   |   | 30,229,711 |   |   | (1,590,016 | ) |   |   | 1999 |   |   |   | Aug-04 |   |   |   | 40 years |   |   |
| Festival Center           |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bradley, IL               |       |              | (2,563,460  | )                                          |       | 912,590                 |       |                                                    | 2,737,771  |                                                  |       |                    | 70,552     |              |       | 912,590               |       |   | 2,808,323 |   |   | 3,720,914 |   |   | (359,525 | ) |   |   | 2006 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Southfield Plaza          |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Bridgeview, IL            |       |              |        |                                       |       | 3,188,496               |       |                                                    | 3,897,167  |                                                  |       |                    | 2,597,774  |              |       | 3,188,496             |       |   | 6,494,941 |   |   | 9,683,437 |   |   | (5,209,757 | ) |   |   | 2006 |   |   |   | Dec-96 |   |   |   | 40 years |   |   |
| Pershing Plaza            |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Decatur, IL               |       |              |        |                                       |       | 750,298                 |       |                                                    | 2,250,894  |                                                  |       |                    | 10,345     |              |       | 750,298               |       |   | 2,261,239 |   |   | 3,011,537 |   |   | (228,617 | ) |   |   | 1986 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Elk Grove Town Center     |       |              |        |                                       |       |                    |       |                                                    |       |                                                  |       |                    |       |              |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Elk Grove Village,  IL    |       |              |        |                                       |       | 8,063,593               |       |                                                    | 11,704,159 |                                                  |       |                    | 12,340     |              |       | 8,063,593             |       |   | 11,716,499 |   |   | 19,780,092 |   |   | (954,739 | ) |   |   | 1998 |   |   |   | Jan-04 |   |   |   | 40  years |   |   |
|                           |            |                   |             |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                       |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

F-53

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESSCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATIONDecember 31, 2006**

| **COLUMN A**                          | ** ** | **COLUMN B** | ** **                | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**           | ** ** |
|--------------------------------------------|------------|-------------------|---------------------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------------|------------|
| ** **                                 | ** ** | ** **        | ** **                | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **                  | ** ** | **Life on Which** | ** ** |
| ** **                                 | ** ** | ** **        | ** **                | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated —** | ** ** |
| ** **                                 | ** ** | ** **        | ** **                | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**             | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**                            | ** ** | ** **        | ** **                | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**                   | ** ** | **Depreciation** | ** ** | **  Constructed  ** | ** ** | **      Acquired      ** | ** ** | **Statement** | ** ** |
| Freeport Plaza  Freeport, IL               |       |              |       |                                       |       | 1,383,601               |       |                                                    | 4,150,804  |                                                  |       |                    | 134,679    |              |       | 1,383,601                   |       |   | 4,285,483 |   |   | 5,669,085 |   |   | (431,631 | ) |   |   | 2000 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |   |
| The Quentin Collection  Kildeer, IL        |       |              |                      |                                       |       | 7,169,606               |       |                                                    | 29,261,613 |                                                  |       |                    |       |              |       | 7,169,606                   |       |   | 29,261,613 |   |   | 36,431,219 |   |   | (255,974 | ) |   |   | 2006 |   |   |   | Sep-06 |   |   |   | 40 years |   |   |   |
| Westridge Court  Naperville, IL            |       |              |                      |                                       |       | 9,843,696               |       |                                                    | 39,373,783 |                                                  |       |                    | 2,233,680  |              |       | 9,843,696                   |       |   | 41,607,463 |   |   | 51,451,159 |   |   | (11,020,039 | ) |   |   | 2002 |   |   |   | Jul-97 |   |   |   | 40 years |   |   |   |
| Olympia Corners  Olympia Fields, IL        |       |              | (4,945,022                | )                                          |       | 2,010,324               |       |                                                    | 6,030,973  |                                                  |       |                    | 243,894    |              |       | 2,010,324                   |       |   | 6,274,867 |   |   | 8,285,191 |   |   | (698,635 | ) |   |   | 1988 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |   |
| Tinley Park Plaza  Tinley Park, IL         |       |              |                      |                                       |       | 2,607,702               |       |                                                    | 10,430,808 |                                                  |       |                    | 5,645,807  |              |       | 2,607,702                   |       |   | 16,076,614 |   |   | 18,684,316 |   |   | (3,736,348 | ) |   |   | 2005 |   |   |   | Sep-95 |   |   |   | 40 years |   |   |   |
| Columbus Center  Columbus, IN              |       |              |                      |                                       |       | 599,158                 |       |                                                    | 1,952,355  |                                                  |       |                    | 6,841,862  |              |       | 599,158                     |       |   | 8,794,216 |   |   | 9,393,375 |   |   | (3,076,164 | ) |   |   | 2005 |   |   |   | Dec-88 |   |   |   | 40 years |   |   |   |
| Elkhart Plaza West  Elkhart, IN            |       |              |                      |                                       |       | 1,864,321               |       |                                                    | 5,592,962  |                                                  |       |                    | 32,178     |              |       | 1,864,321                   |       |   | 5,625,140 |   |   | 7,489,461 |   |   | (549,874 | ) |   |   | 1997 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |   |
| Elkhart Market Centre  Goshen, IN          |       |              | (12,146,961               | )                                          |       | 5,528,742               |       |                                                    | 16,586,227 |                                                  |       |                    | 918,377    |              |       | 5,528,742                   |       |   | 17,504,604 |   |   | 23,033,346 |   |   | (1,677,894 | ) |   |   | 1994 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |   |
| Valley View Plaza  Marion, IN              |       |              |                      |                                       |       | 684,867                 |       |                                                    | 2,739,492  |                                                  |       |                    | 99,451     |              |       | 684,867                     |       |   | 2,838,943 |   |   | 3,523,810 |   |   | (610,514 | ) |   |   | 1997 |   |   |   | Mar-94 |   |   |   | 40 years |   |   |   |
| Knox Plaza  Vincennes, IN                  |       |              |                      |                                       |       | 411,877                 |       |                                                    | 1,235,631  |                                                  |       |                    |       |              |       | 411,877                     |       |   | 1,235,631 |   |   | 1,647,508 |   |   | (134,722 | ) |   |   | 1989 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |   |
| Wabash Crossing  Wabash, IN                |       |              |                      |                                       |       | 1,557,711               |       |                                                    | 6,470,511  |                                                  |       |                    | 57,496     |              |       | 1,557,711                   |       |   | 6,528,008 |   |   | 8,085,718 |   |   | (2,129,647 | ) |   |   | 2007 |   |   |   | Dec-93 |   |   |   | 40 years |   |   |   |
| Florence Plaza  Florence, KY               |       |              |                      |                                       |       | 2,524,185               |       |                                                    | 7,572,556  |                                                  |       |                    | 407,719    |              |       | 2,524,185                   |       |   | 7,980,275 |   |   | 10,504,460 |   |   | (858,183 | ) |   |   | 1985 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |   |
| Florence Square  Florence, KY              |       |              | (15,023,620               | )                                          |       | 8,208,760               |       |                                                    | 24,457,786 |                                                  |       |                    | 1,344,565  |              |       | 8,208,760                   |       |   | 25,802,352 |   |   | 34,011,112 |   |   | (2,059,581 | ) |   |   | 2000 |   |   |   | Mar-04 |   |   |   | 40 years |   |   |   |
| Highland Commons  Glasgow, KY              |       |              | (3,403,908                | )                                          |       | 1,500,300               |       |                                                    | 6,862,680  |                                                  |       |                    | 136,238    |              |       | 1,500,300                   |       |   | 6,998,918 |   |   | 8,499,219 |   |   | (1,469,546 | ) |   |   | 1992 |   |   |   | Mar-93 |   |   |   | 40 years |   |   |   |
| Jefferson Towne Commons  Jeffersontown, KY |       |              |                      |                                       |       | 1,331,074               |       |                                                    | 4,121,997  |                                                  |       |                    | 10,074,839 |              |       | 1,331,074                   |       |   | 14,196,836 |   |   | 15,527,910 |   |   | (2,694,213 | ) |   |   | 2005 |   |   |   | Oct-88 |   |   |   | 40 years |   |   |   |
| Mist Lake Plaza  Lexington, KY             |       |              |                      |                                       |       | 4,075,659               |       |                                                    | 16,405,956 |                                                  |       |                    | 264,819    |              |       | 4,075,659                   |       |   | 16,670,775 |   |   | 20,746,434 |   |   | (3,461,261 | ) |   |   | 1993 |   |   |   | Jul-98 |   |   |   | 40 years |   |   |   |
| Eastgate Shopping Center  Louisville, KY   |       |              |                      |                                       |       | 1,945,679               |       |                                                    | 7,792,717  |                                                  |       |                    | 424,989    |              |       | 1,945,679                   |       |   | 8,217,706 |   |   | 10,163,385 |   |   | (3,381,211 | ) |   |   | 2002 |   |   |   | Nov-93 |   |   |   | 40 years |   |   |   |
| Piccadilly Shopping Plaza  Louisville, KY  |       |              |                      |                                       |       | 337,670                 |       |                                                    | 1,588,409  |                                                  |       |                    | 1,105,653  |              |       | 337,670                     |       |   | 2,694,063 |   |   | 3,031,733 |   |   | (1,175,069 | ) |   |   | 2006 |   |   |   | Apr-89 |   |   |   | 40 years |   |   |   |
| Towne Square North  Owensboro, KY          |       |              |                      |                                       |       | 2,277,220               |       |                                                    | 6,831,659  |                                                  |       |                    | 288,716    |              |       | 2,277,220                   |       |   | 7,120,375 |   |   | 9,397,595 |   |   | (746,086 | ) |   |   | 1988 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |   |
| Lexington Road Plaza  Versailles, KY       |       |              | (6,261,812                | )                                          |       | 2,856,229               |       |                                                    | 11,425,027 |                                                  |       |                    | 145,926    |              |       | 2,856,229                   |       |   | 11,570,953 |   |   | 14,427,182 |   |   | (2,418,831 | ) |   |   | 2007 |   |   |   | Apr-94 |   |   |   | 40 years |   |   |   |
| Iberia Plaza  New Iberia, LA               |       |              |                      |                                       |       | 1,295,361               |       |                                                    | 3,730,569  |                                                  |       |                    | 236,004    |              |       | 1,295,361                   |       |   | 3,966,573 |   |   | 5,261,934 |   |   | (507,430 | ) |   |   | 1992 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |   |
| Lagniappe Village  New Iberia, LA          |       |              |                      |                                       |       | 3,122,914               |       |                                                    | 12,491,850 |                                                  |       |                    | 456,751    |              |       | 3,122,914                   |       |   | 12,948,601 |   |   | 16,071,515 |   |   | (2,838,991 | ) |   |   | 1990 |   |   |   | Jul-98 |   |   |   | 40 years |   |   |   |
| Points West  Brockton, MA                  |       |              |                      |                                       |       | 1,846,851               |       |                                                    | 5,540,554  |                                                  |       |                    | 267,334    |              |       | 1,846,851                   |       |   | 5,807,888 |   |   | 7,654,739 |   |   | (613,974 | ) |   |   | 2007 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |   |
|                                            |            |                   |                           |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                             |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

F-54

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESSCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATIONDecember 31, 2006**

| **COLUMN A**                           | ** ** | **COLUMN B** | ** **  | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**           | ** ** |
|---------------------------------------------|------------|-------------------|-------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------------|------------|
| ** **                                  | ** ** | ** **        | ** **  | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **                  | ** ** | **Life on Which** | ** ** |
| ** **                                  | ** ** | ** **        | ** **  | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated —** | ** ** |
| ** **                                  | ** ** | ** **        | ** **  | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**             | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**                             | ** ** | ** **        | ** **  | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**                   | ** ** | **Depreciation** | ** ** | **  Constructed  ** | ** ** | **      Acquired      ** | ** ** | **Statement** | ** ** |
| Holyoke Shopping Center  Holyoke, MA        |       |              |        |                                       |       | 2,979,803               |       |                                                    | 8,510,744  |                                                  |       |                    | 244,928    |              |       | 2,979,803                   |       |   | 8,755,672 |   |   | 11,735,475 |   |   | (928,033 | ) |   |   | 2000 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Liberty Plaza  Randallstown, MD             |       |              |        |                                       |       | 2,075,809               |       |                                                    | 5,848,620  |                                                  |       |                    | 767,002    |              |       | 2,075,809                   |       |   | 6,615,622 |   |   | 8,691,431 |   |   | (2,551,091 | ) |   |   | 2007 |   |   |   | May-95 |   |   |   | 40 years |   |   |
| Rising Sun Towne Centre  Rising Sun, MD     |       |              |        |                                       |       | 1,161,300               |       |                                                    | 4,389,359  |                                                  |       |                    | 157,582    |              |       | 1,161,300                   |       |   | 4,546,941 |   |   | 5,708,241 |   |   | (904,160 | ) |   |   | 2007 |   |   |   | Jun-99 |   |   |   | 40 years |   |   |
| Maple Village  Ann Arbor, MI                |       |              |        |                                       |       | 1,622,732               |       |                                                    | 7,501,205  |                                                  |       |                    | 1,373,583  |              |       | 1,622,732                   |       |   | 8,874,789 |   |   | 10,497,521 |   |   | (3,797,891 | ) |   |   | 2000 |   |   |   | Oct-94 |   |   |   | 40 years |   |   |
| Grand Crossing  Brighton, MI                |       |              |        |                                       |       | 1,709,627               |       |                                                    | 5,128,881  |                                                  |       |                    | 895,795    |              |       | 1,709,627                   |       |   | 6,024,677 |   |   | 7,734,304 |   |   | (548,870 | ) |   |   | 2005 |   |   |   | Jan-03 |   |   |   | 40 years |   |   |
| Farmington Crossroads  Farmington, MI       |       |              |        |                                       |       | 1,092,200               |       |                                                    | 4,368,800  |                                                  |       |                    | 254,771    |              |       | 1,092,200                   |       |   | 4,623,571 |   |   | 5,715,771 |   |   | (1,311,069 | ) |   |   | 1986 |   |   |   | Dec-95 |   |   |   | 40 years |   |   |
| Silver Lake  Fenton, MI                     |       |              |        |                                       |       | 2,397,852               |       |                                                    | 7,193,555  |                                                  |       |                    | 48,774     |              |       | 2,397,852                   |       |   | 7,242,329 |   |   | 9,640,181 |   |   | (721,842 | ) |   |   | 1996 |   |   |   | Jan-03 |   |   |   | 40 years |   |   |
| Silver Pointe Shopping Center  Fenton, MI   |       |              | (7,161,608  | )                                          |       | 2,200,544               |       |                                                    | 8,223,286  |                                                  |       |                    | 31,700     |              |       | 2,200,544                   |       |   | 8,254,986 |   |   | 10,455,530 |   |   | (507,328 | ) |   |   | 1996 |   |   |   | Nov 04 |   |   |   | 40 years |   |   |
| Fremont  Fremont, MI                        |       |              |        |                                       |       | 405,901                 |       |                                                    | 1,217,703  |                                                  |       |                    | 11,350     |              |       | 405,901                     |       |   | 1,229,053 |   |   | 1,634,954 |   |   | (125,406 | ) |   |   | 2007 |   |   |   | Jan-03 |   |   |   | 40 years |   |   |
| Cascade East  Grand Rapids, MI              |       |              |        |                                       |       | 1,826,689               |       |                                                    | 5,480,068  |                                                  |       |                    | 129,656    |              |       | 1,826,689                   |       |   | 5,609,724 |   |   | 7,436,413 |   |   | (568,260 | ) |   |   | 1983 |   |   |   | Jan-03 |   |   |   | 40 years |   |   |
| Kentwood  Kentwood, MI                      |       |              |        |                                       |       | 1,191,795               |       |                                                    | 3,786,382  |                                                  |       |                    | 89,738     |              |       | 1,191,795                   |       |   | 3,876,120 |   |   | 5,067,915 |   |   | (397,339 | ) |   |   | 1987 |   |   |   | Jan-03 |   |   |   | 40 years |   |   |
| Hampton Village Centre  Rochester Hills, MI |       |              | (28,449,679 | )                                          |       | 7,209,596               |       |                                                    | 34,541,500 |                                                  |       |                    | 4,510,273  |              |       | 7,209,596                   |       |   | 39,051,773 |   |   | 46,261,369 |   |   | (10,363,797 | ) |   |   | 2004 |   |   |   | Dec-95 |   |   |   | 40 years |   |   |
| Hall Road Crossing  Shelby Township, MI     |       |              |        |                                       |       | 2,595,500               |       |                                                    | 10,382,000 |                                                  |       |                    | 1,225,195  |              |       | 2,595,500                   |       |   | 11,607,195 |   |   | 14,202,695 |   |   | (3,534,862 | ) |   |   | 1999 |   |   |   | Dec-95 |   |   |   | 40 years |   |   |
| Southfield Shopping Center  Southfield, MI  |       |              |        |                                       |       | 2,052,995               |       |                                                    | 8,056,980  |                                                  |       |                    | 381,043    |              |       | 2,052,995                   |       |   | 8,438,023 |   |   | 10,491,018 |   |   | (1,968,169 | ) |   |   | 2002 |   |   |   | Feb-98 |   |   |   | 40 years |   |   |
| 18 Mile & Ryan  Sterling Heights, MI    |       |              |        |                                       |       | 2,852,408               |       |                                                    | 8,557,223  |                                                  |       |                    |       |              |       | 2,852,408                   |       |   | 8,557,223 |   |   | 11,409,630 |   |   | (854,648 | ) |   |   | 1997 |   |   |   | Jan-03 |   |   |   | 40 years |   |   |
| Delco Plaza  Sterling Heights, MI           |       |              |        |                                       |       | 1,277,504               |       |                                                    | 5,109,367  |                                                  |       |                    | 210,917    |              |       | 1,277,504                   |       |   | 5,320,284 |   |   | 6,597,788 |   |   | (1,364,325 | ) |   |   | 1996 |   |   |   | Nov-96 |   |   |   | 40 years |   |   |
| Harvest Place  Stevensville, MI             |       |              |        |                                       |       | 1,156,967               |       |                                                    | 3,470,900  |                                                  |       |                    | 7,700      |              |       | 1,156,967                   |       |   | 3,478,600 |   |   | 4,635,567 |   |   | (347,338 | ) |   |   | 1994 |   |   |   | Jan-03 |   |   |   | 40 years |   |   |
| West Ridge Shopping Center  Westland, MI    |       |              | (10,772,718 | )                                          |       | 3,377,757               |       |                                                    | 12,730,287 |                                                  |       |                    | 186,100    |              |       | 3,377,757                   |       |   | 12,916,387 |   |   | 16,294,144 |   |   | (811,110 | ) |   |   | 1989 |   |   |   | Mar-05 |   |   |   | 40 years |   |   |
| Westland Crossing  Westland, MI             |       |              |        |                                       |       | 2,046,000               |       |                                                    | 8,184,000  |                                                  |       |                    | 552,186    |              |       | 2,046,000                   |       |   | 8,736,186 |   |   | 10,782,186 |   |   | (1,820,964 | ) |   |   | 1999 |   |   |   | Nov-99 |   |   |   | 40 years |   |   |
|                                             |            |                   |             |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                             |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

F-55

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESSCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATIONDecember 31, 2006**

| **COLUMN A**                          | ** ** | **COLUMN B** | ** ** | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**     | ** ** |                        |
|--------------------------------------------|------------|-------------------|------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------|------------|-----------------------------|
| ** **                                 | ** ** | ** **        | ** ** | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | **Life on Which** | ** ** |   |
| ** **                                 | ** ** | ** **        | ** ** | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—** | ** ** |                        |
| ** **                                 | ** ** | ** **        | ** ** | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**       | ** ** | **Year**                    | ** ** | **Date** | ** ** | **Latest Income** | ** ** |   |
| **Description**                            | ** ** | ** **        | ** ** | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**             | ** ** | **Depreciation**            | ** ** | **Constructed** | ** ** | **Acquired** | ** ** | **Statement** | ** ** |   |
| University IV  Spring Lake Park, MN        |       |              | (1,731,501 | )                                          |       | 987,865                 |       |                                                    | 2,963,594  |                                                  |       |                    | 44,644     |              |       | 987,865               |       |                        | 3,008,238 |   |   | 3,996,103 |   |   | (304,632 | ) |   |   | 1988 |   |   |   | Dec-02 |   |   |   | 40  years |   |   |
| Macon Plaza  Franklin, NC                  |       |              |       |                                       |       | 832,590                 |       |                                                    | 2,497,770  |                                                  |       |                    | 36,530     |              |       | 832,590               |       |                        | 2,534,300 |   |   | 3,366,890 |   |   | (256,229 | ) |   |   | 2001 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Foothills Market  Jonesville, NC           |       |              |       |                                       |       | 644,555                 |       |                                                    | 2,578,295  |                                                  |       |                    | 62,199     |              |       | 644,555               |       |                        | 2,640,494 |   |   | 3,285,049 |   |   | (582,947 | ) |   |   | 1996 |   |   |   | Jun-95 |   |   |   | 40 years |   |   |
| Chapel Square  Kannapolis, NC              |       |              | (1,338,331 | )                                          |       | 918,460                 |       |                                                    | 3,673,918  |                                                  |       |                    | 25,327     |              |       | 918,460               |       |                        | 3,699,245 |   |   | 4,617,705 |   |   | (764,725 | ) |   |   | 1992 |   |   |   | Dec-94 |   |   |   | 40 years |   |   |
| Kinston Pointe  Kinston, NC                |       |              |       |                                       |       | 2,235,052               |       |                                                    | 8,940,354  |                                                  |       |                    | 118,853    |              |       | 2,235,052             |       |                        | 9,059,208 |   |   | 11,294,260 |   |   | (2,163,331 | ) |   |   | 2001 |   |   |   | Jul-95 |   |   |   | 40 years |   |   |
| Roxboro Square  Roxboro, NC                |       |              |       |                                       |       | 1,448,313               |       |                                                    | 5,793,289  |                                                  |       |                    | 6,789,067  |              |       | 1,448,313             |       |                        | 12,582,357 |   |   | 14,030,670 |   |   | (1,430,714 | ) |   |   | 2005 |   |   |   | Jun-95 |   |   |   | 40 years |   |   |
| Siler Crossing  Siler City, NC             |       |              |       |                                       |       | 1,779,566               |       |                                                    | 7,118,100  |                                                  |       |                    | 59,774     |              |       | 1,779,566             |       |                        | 7,177,873 |   |   | 8,957,439 |   |   | (1,483,802 | ) |   |   | 1988 |   |   |   | Jun-95 |   |   |   | 40 years |   |   |
| Crossroads Center  Statesville, NC         |       |              |       |                                       |       | 5,261,636               |       |                                                    | 21,177,392 |                                                  |       |                    | 100,867    |              |       | 5,261,636             |       |                        | 21,278,258 |   |   | 26,539,894 |   |   | (4,478,506 | ) |   |   | 1997 |   |   |   | Feb-96 |   |   |   | 40 years |   |   |
| Thomasville Crossing  Thomasville, NC      |       |              |       |                                       |       | 1,604,339               |       |                                                    | 6,417,145  |                                                  |       |                    | 14,934     |              |       | 1,604,339             |       |                        | 6,432,078 |   |   | 8,036,417 |   |   | (1,323,481 | ) |   |   | 1996 |   |   |   | Apr-97 |   |   |   | 40 years |   |   |
| Anson Station  Wadesboro, NC               |       |              |       |                                       |       | 1,844,644               |       |                                                    | 5,118,172  |                                                  |       |                    | 98,454     |              |       | 1,844,644             |       |                        | 5,216,625 |   |   | 7,061,269 |   |   | (1,169,887 | ) |   |   | 1988 |   |   |   | Aug-95 |   |   |   | 40 years |   |   |
| Roanoke Landing  Williamston, NC           |       |              |       |                                       |       | 2,519,288               |       |                                                    | 10,077,339 |                                                  |       |                    | 69,003     |              |       | 2,519,288             |       |                        | 10,146,342 |   |   | 12,665,631 |   |   | (2,104,704 | ) |   |   | 1991 |   |   |   | Jan-96 |   |   |   | 40 years |   |   |
| Laurel Square  Brick, NJ                   |       |              |       |                                       |       | 3,222,701               |       |                                                    | 9,283,302  |                                                  |       |                    | 1,467,730  |              |       | 3,222,701             |       |                        | 10,751,031 |   |   | 13,973,732 |   |   | (4,124,283 | ) |   |   | 2003 |   |   |   | Jul-92 |   |   |   | 40 years |   |   |
| Hamilton Plaza - Kmart Plaza  Hamilton, NJ |       |              |       |                                       |       | 1,124,415               |       |                                                    | 4,513,658  |                                                  |       |                    | 344,462    |              |       | 1,124,415             |       |                        | 4,858,121 |   |   | 5,982,535 |   |   | (1,682,993 | ) |   |   | 1972 |   |   |   | May-94 |   |   |   | 40 years |   |   |
| Bennetts Mills Plaza  Jackson, NJ          |       |              |       |                                       |       | 1,794,122               |       |                                                    | 6,399,888  |                                                  |       |                    | 955,407    |              |       | 1,794,122             |       |                        | 7,355,295 |   |   | 9,149,417 |   |   | (2,183,234 | ) |   |   | 2002 |   |   |   | Sep-94 |   |   |   | 40 years |   |   |
| Middletown Plaza  Middletown, NJ           |       |              |       |                                       |       | 1,204,829               |       |                                                    | 7,871,317  |                                                  |       |                    | 9,575,267  |              |       | 1,204,829             |       |                        | 17,446,583 |   |   | 18,651,413 |   |   | (5,134,554 | ) |   |   | 2002 |   |   |   | Jan-75 |   |   |   | 40 years |   |   |
| Tinton Falls Plaza  Tinton Falls, NJ       |       |              |       |                                       |       | 1,884,325               |       |                                                    | 6,308,392  |                                                  |       |                    | 2,312,718  |              |       | 1,884,325             |       |                        | 8,621,110 |   |   | 10,505,435 |   |   | (1,552,712 | ) |   |   | 2006 |   |   |   | Jan-98 |   |   |   | 40 years |   |   |
| Paseo del Norte  Albuquerque, NM           |       |              |       |                                       |       | 2,639,471               |       |                                                    |       |                                                  |       |                    | 117,277    |              |       | 2,639,471             |       |                        | 117,277 |   |   | 2,756,748 |   |   | (96,390 | ) |   |   | 2004 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Socorro  Socorro, NM                       |       |              | *          |                                       |       | 953,411                 |       |                                                    | 2,926,733  |                                                  |       |                    |       |              |       | 953,411               |       |                        | 2,926,733 |   |   | 3,880,143 |   |   | (353,279 | ) |   |   | 1976 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Renaissance Center East  Las Vegas, NV     |       |              |       |                                       |       | 2,543,856               |       |                                                    | 10,175,427 |                                                  |       |                    | 1,755,180  |              |       | 2,543,856             |       |                        | 11,930,607 |   |   | 14,474,463 |   |   | (3,073,525 | ) |   |   | 2006 |   |   |   | Oct-96 |   |   |   | 40 years |   |   |
| Kietzke Center  Reno, NV                   |       |              |       |                                       |       | 3,069,735               |       |                                                    | 12,279,924 |                                                  |       |                    | 331,106    |              |       | 3,069,735             |       |                        | 12,611,030 |   |   | 15,680,765 |   |   | (2,660,229 | ) |   |   | 2007 |   |   |   | Jun-97 |   |   |   | 40 years |   |   |
| Cortlandville  Cortland, NY                |       |              |       |                                       |       | 237,194                 |       |                                                    | 1,440,393  |                                                  |       |                    | 2,836,215  |              |       | 237,194               |       |                        | 4,276,608 |   |   | 4,513,801 |   |   | (1,159,831 | ) |   |   | 2003 |   |   |   | Aug-87 |   |   |   | 40 years |   |   |
| Kmart Plaza  De Witt, NY                   |       |              |       |                                       |       | 943,079                 |       |                                                    | 3,772,312  |                                                  |       |                    | 498,856    |              |       | 943,079               |       |                        | 4,271,167 |   |   | 5,214,246 |   |   | (1,445,604 | ) |   |   | 1970 |   |   |   | Aug-93 |   |   |   | 40 years |   |   |
| Elmira Plaza  Elmira, NY                   |       |              |       |                                       |       | 110,318                 |       |                                                    | 892,015    |                                                  |       |                    | 174,122    |              |       | 110,318               |       |                        | 1,066,137 |   |   | 1,176,455 |   |   | (944,020 | ) |   |   | 2001 |   |   |   | Feb-89 |   |   |   | 40 years |   |   |
| Pyramid Mall  Geneva, NY                   |       |              |       |                                       |       | 2,176,731               |       |                                                    | 8,706,926  |                                                  |       |                    | 489,633    |              |       | 2,176,731             |       |                        | 9,196,559 |   |   | 11,373,290 |   |   | (3,174,036 | ) |   |   | 2006 |   |   |   | Aug-93 |   |   |   | 40 years |   |   |
|                                            |            |                   |            |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                       |            |                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

** **

F-56

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESSCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATIONDecember 31, 2006**

| **COLUMN A**                    | ** ** | **COLUMN B** | ** ** | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**     | ** ** |                        |
|--------------------------------------|------------|-------------------|------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------|------------|-----------------------------|
| ** **                           | ** ** | ** **        | ** ** | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | **Life on Which** | ** ** |   |
| ** **                           | ** ** | ** **        | ** ** | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—** | ** ** |                        |
| ** **                           | ** ** | ** **        | ** ** | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**       | ** ** | **Year**                    | ** ** | **Date** | ** ** | **Latest Income** | ** ** |   |
| **Description**                      | ** ** | ** **        | ** ** | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**             | ** ** | **Depreciation**            | ** ** | **Constructed** | ** ** | **Acquired** | ** ** | **Statement** | ** ** |   |
| Cayuga Mall  Ithaca, NY              |       |              |       |                                       |       | 1,368,908               |       |                                                    | 5,597,954  |                                                  |       |                    | 859,181    |              |       | 1,368,908             |       |                        | 6,457,135 |   |   | 7,826,044 |   |   | (3,014,140 | ) |   |   | 1969 |   |   |   | May-89 |   |   |   | 40 years |   |   |
| Transit Road Plaza  Lockport, NY     |       |              |       |                                       |       | 424,680                 |       |                                                    | 1,698,721  |                                                  |       |                    | 4,610,513  |              |       | 424,680               |       |                        | 6,309,233 |   |   | 6,733,913 |   |   | (1,034,863 | ) |   |   | 2005 |   |   |   | Aug-93 |   |   |   | 40 years |   |   |
| Sunshine Square  Medford, NY         |       |              | (7,320,456 | )                                          |       | 3,525,378               |       |                                                    | 10,576,133 |                                                  |       |                    |       |              |       | 3,525,378             |       |                        | 10,576,133 |   |   | 14,101,511 |   |   | (1,066,246 | ) |   |   | 2007 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Wallkill Plaza  Middletown, NY       |       |              |       |                                       |       | 2,748,152               |       |                                                    | 9,672,604  |                                                  |       |                    | 3,213,025  |              |       | 2,748,152             |       |                        | 12,885,629 |   |   | 15,633,780 |   |   | (2,919,123 | ) |   |   | 2005 |   |   |   | Dec-95 |   |   |   | 40 years |   |   |
| Monroe Shoprite Plaza  Monroe, NY    |       |              |       |                                       |       | 1,028,189               |       |                                                    | 8,649,212  |                                                  |       |                    | 326,531    |              |       | 1,028,189             |       |                        | 8,975,743 |   |   | 10,003,932 |   |   | (2,108,152 | ) |   |   | 1985 |   |   |   | Aug-97 |   |   |   | 40 years |   |   |
| Rockland Plaza  Nanuet, NY           |       |              |       |                                       |       | 3,904,495               |       |                                                    | 3,056,456  |                                                  |       |                    | 8,494,993  |              |       | 3,904,495             |       |                        | 11,551,449 |   |   | 15,455,944 |   |   | (5,977,872 | ) |   |   | 2006 |   |   |   | Jan-83 |   |   |   | 40 years |   |   |
| Mohawk Acres  Rome, NY               |       |              |       |                                       |       | 335,734                 |       |                                                    | 1,755,445  |                                                  |       |                    | 2,799,783  |              |       | 335,734               |       |                        | 4,555,228 |   |   | 4,890,962 |   |   | (2,547,665 | ) |   |   | 2005 |   |   |   | Jan-84 |   |   |   | 40 years |   |   |
| Price Chopper Plaza  Rome, NY        |       |              |       |                                       |       | 934,687                 |       |                                                    | 3,738,751  |                                                  |       |                    | 178,730    |              |       | 934,687               |       |                        | 3,917,480 |   |   | 4,852,167 |   |   | (1,315,485 | ) |   |   | 2007 |   |   |   | Aug-93 |   |   |   | 40 years |   |   |
| Village Center  Smithtown, NY        |       |              | (4,250,242 | )                                          |       | 3,195,563               |       |                                                    | 13,015,362 |                                                  |       |                    | 79,041     |              |       | 3,195,563             |       |                        | 13,094,403 |   |   | 16,289,966 |   |   | (839,252 | ) |   |   | 2005 |   |   |   | Aug-04 |   |   |   | 40 years |   |   |
| Brunswick Town Center  Brunswick, OH |       |              |       |                                       |       | 3,328,056               |       |                                                    | 13,776,125 |                                                  |       |                    |       |              |       | 3,328,056             |       |                        | 13,776,125 |   |   | 17,104,180 |   |   | (699,342 | ) |   |   | 2004 |   |   |   | Jan-05 |   |   |   | 40 years |   |   |
| Springbrook Plaza  Canton, OH        |       |              |       |                                       |       | 2,846,763               |       |                                                    | 8,822,289  |                                                  |       |                    | 189,735    |              |       | 2,846,763             |       |                        | 9,012,024 |   |   | 11,858,788 |   |   | (1,024,732 | ) |   |   | 1989 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Brentwood Plaza  Cincinnati, OH      |       |              |       |                                       |       | 2,027,969               |       |                                                    | 8,222,875  |                                                  |       |                    | 6,620,405  |              |       | 2,027,969             |       |                        | 14,843,280 |   |   | 16,871,249 |   |   | (3,434,485 | ) |   |   | 2004 |   |   |   | May-94 |   |   |   | 40 years |   |   |
| Delhi  Cincinnati, OH                |       |              |       |                                       |       | 2,300,029               |       |                                                    | 9,218,117  |                                                  |       |                    | 860,834    |              |       | 2,300,029             |       |                        | 10,078,951 |   |   | 12,378,980 |   |   | (2,797,707 | ) |   |   | 2002 |   |   |   | May-96 |   |   |   | 40 years |   |   |
| Harpers Station  Cincinnati, OH      |       |              |       |                                       |       | 7,209,895               |       |                                                    | 15,221,639 |                                                  |       |                    | 72,631     |              |       | 7,209,895             |       |                        | 15,294,271 |   |   | 22,504,166 |   |   | (1,267,060 | ) |   |   | 2000 |   |   |   | Sep-03 |   |   |   | 40 years |   |   |
| Hillcrest Square  Cincinnati, OH     |       |              |       |                                       |       | 654,870                 |       |                                                    | 1,964,609  |                                                  |       |                    | 250,733    |              |       | 654,870               |       |                        | 2,215,342 |   |   | 2,870,211 |   |   | (251,387 | ) |   |   | 1996 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| Western Hills Plaza  Cincinnati, OH  |       |              |       |                                       |       | 8,885,880               |       |                                                    | 40,704,638 |                                                  |       |                    | 67,955     |              |       | 8,885,880             |       |                        | 40,772,593 |   |   | 49,658,473 |   |   | (1,600,340 | ) |   |   | 1989 |   |   |   | Nov-05 |   |   |   | 40 years |   |   |
| Western Village  Cincinnati, OH      |       |              |       |                                       |       | 1,321,484               |       |                                                    | 5,300,935  |                                                  |       |                    | 5,359,689  |              |       | 1,321,484             |       |                        | 10,660,625 |   |   | 11,982,108 |   |   | (1,909,508 | ) |   |   | 2005 |   |   |   | May-94 |   |   |   | 40 years |   |   |
| Crown Point  Columbus, OH            |       |              | (6,553,567 | )                                          |       | 2,881,681               |       |                                                    | 7,958,319  |                                                  |       |                    | 281,617    |              |       | 2,881,681             |       |                        | 8,239,936 |   |   | 11,121,617 |   |   | (1,970,369 | ) |   |   | 1998 |   |   |   | Jul-98 |   |   |   | 40 years |   |   |
|                                      |            |                   |            |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                       |            |                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

F-57

----

**NEW PLAN EXCELREALTY TRUST, INC. AND SUBSIDIARIESSCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATIONDecember 31, 2006**

| **COLUMN A**                        | ** ** | **COLUMN B** | ** **  | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**     | ** ** |                        |
|------------------------------------------|------------|-------------------|-------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------|------------|-----------------------------|
| ** **                               | ** ** | ** **        | ** **  | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | **Life on Which** | ** ** |   |
| ** **                               | ** ** | ** **        | ** **  | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—** | ** ** |                        |
| ** **                               | ** ** | ** **        | ** **  | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**       | ** ** | **Year**                    | ** ** | **Date** | ** ** | **Latest Income** | ** ** |   |
| **Description**                          | ** ** | ** **        | ** **  | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**             | ** ** | **Depreciation**            | ** ** | **Constructed** | ** ** | **Acquired** | ** ** | **Statement** | ** ** |   |
| Greentree Shopping Center  Columbus, OH  |       |              | (4,749,517  | )                                          |       | 3,379,200               |       |                                                    | 6,860,800  |                                                  |       |                    | 205,508    |              |       | 3,379,200             |       |                        | 7,066,308 |   |   | 10,445,508 |   |   | (1,666,404 | ) |   |   | 2005 |   |   |   | Jul-98 |   |   |   | 40  years |   |   |
| Karl Plaza  Columbus, OH                 |       |              | (3,505,542  | )                                          |       | 1,235,044               |       |                                                    | 3,705,132  |                                                  |       |                    | 137,905    |              |       | 1,235,044             |       |                        | 3,843,037 |   |   | 5,078,081 |   |   | (434,765 | ) |   |   | 1992 |   |   |   | Dec-02 |   |   |   | 40  years |   |   |
| South Towne Centre  Dayton, OH           |       |              |        |                                       |       | 4,737,368               |       |                                                    | 9,636,943  |                                                  |       |                    | 863,013    |              |       | 4,737,368             |       |                        | 10,499,956 |   |   | 15,237,324 |   |   | (4,164,301 | ) |   |   | 2007 |   |   |   | Mar-92 |   |   |   | 40  years |   |   |
| The Vineyards  Eastlake, OH              |       |              | (7,647,301  | )                                          |       | 3,016,683               |       |                                                    | 9,050,049  |                                                  |       |                    | 129,627    |              |       | 3,016,683             |       |                        | 9,179,675 |   |   | 12,196,358 |   |   | (969,818 | ) |   |   | 1989 |   |   |   | Dec-02 |   |   |   | 40  years |   |   |
| Midway Crossing  Elyria, OH              |       |              |        |                                       |       | 3,128,504               |       |                                                    | 7,776,800  |                                                  |       |                    | 329,589    |              |       | 3,128,504             |       |                        | 8,106,389 |   |   | 11,234,893 |   |   | (2,456,864 | ) |   |   | 2007 |   |   |   | Dec-95 |   |   |   | 40  years |   |   |
| Midway Market Square  Elyria, OH         |       |              | (15,758,095 | )                                          |       | 5,145,249               |       |                                                    | 20,597,920 |                                                  |       |                    | 60,415     |              |       | 5,145,249             |       |                        | 20,658,335 |   |   | 25,803,584 |   |   | (2,108,582 | ) |   |   | 2001 |   |   |   | Nov-02 |   |   |   | 40  years |   |   |
| New Boston  New Boston, OH               |       |              |        |                                       |       | 2,102,371               |       |                                                    | 9,537,101  |                                                  |       |                    | 242,951    |              |       | 2,102,371             |       |                        | 9,780,052 |   |   | 11,882,422 |   |   | (3,503,137 | ) |   |   | 2000 |   |   |   | Feb-93 |   |   |   | 40  years |   |   |
| Surrey Square Mall  Norwood, OH          |       |              |        |                                       |       | 3,184,794               |       |                                                    | 7,836,828  |                                                  |       |                    |       |              |       | 3,184,794             |       |                        | 7,836,828 |   |   | 11,021,622 |   |   | (311,274 | ) |   |   | 2007 |   |   |   | Aug-05 |   |   |   | 40  years |   |   |
| Market Place  Piqua, OH                  |       |              |        |                                       |       | 976,763                 |       |                                                    | 3,738,164  |                                                  |       |                    | 347,070    |              |       | 976,763               |       |                        | 4,085,233 |   |   | 5,061,997 |   |   | (1,780,442 | ) |   |   | 2007 |   |   |   | Nov-91 |   |   |   | 40  years |   |   |
| Starlite Plaza  Sylvania, OH             |       |              |        |                                       |       | 4,526,286               |       |                                                    | 11,628,011 |                                                  |       |                    | 238,608    |              |       | 4,526,286             |       |                        | 11,866,619 |   |   | 16,392,905 |   |   | (876,409 | ) |   |   | 2000 |   |   |   | Jul-04 |   |   |   | 40  years |   |   |
| Alexis Park  Toledo, OH                  |       |              | 32,966      |                                       |       | 2,228,272               |       |                                                    | 6,684,816  |                                                  |       |                    | 217,041    |              |       | 2,228,272             |       |                        | 6,901,856 |   |   | 9,130,128 |   |   | (752,336 | ) |   |   | 1988 |   |   |   | Dec-02 |   |   |   | 40  years |   |   |
| Southland Shopping Plaza  Toledo, OH     |       |              |        |                                       |       | 4,113,346               |       |                                                    | 10,193,224 |                                                  |       |                    | 34,799     |              |       | 4,113,346             |       |                        | 10,228,023 |   |   | 14,341,369 |   |   | (735,893 | ) |   |   | 1988 |   |   |   | Dec-05 |   |   |   | 40  years |   |   |
| Marketplace  Tulsa, OK                   |       |              | (9,719,461  | )                                          |       | 4,182,127               |       |                                                    | 15,942,413 |                                                  |       |                    | 135,378    |              |       | 4,182,127             |       |                        | 16,077,791 |   |   | 20,259,919 |   |   | (1,030,670 | ) |   |   | 1992 |   |   |   | Sep-04 |   |   |   | 40  years |   |   |
| Bethel Park  Bethel Park, PA             |       |              |        |                                       |       | 868,039                 |       |                                                    | 9,933,094  |                                                  |       |                    | 1,493,279  |              |       | 868,039               |       |                        | 11,426,373 |   |   | 12,294,412 |   |   | (3,021,626 | ) |   |   | 2004 |   |   |   | May-97 |   |   |   | 40  years |   |   |
| New Britain Village Square  Chalfont, PA |       |              |        |                                       |       | 4,240,303               |       |                                                    | 14,255,020 |                                                  |       |                    | 167,470    |              |       | 4,240,303             |       |                        | 14,422,490 |   |   | 18,662,792 |   |   | (1,187,516 | ) |   |   | 1989 |   |   |   | Jan-04 |   |   |   | 40  years |   |   |
| Harveys  Clearfield, PA                  |       |              |        |                                       |       | 357,218                 |       |                                                    | 1,400,990  |                                                  |       |                    |       |              |       | 357,218               |       |                        | 1,400,990 |   |   | 1,758,208 |   |   | (281,322 | ) |   |   | 1982 |   |   |   | Aug-93 |   |   |   | 40  years |   |   |
| Laurel Mall  Connellsville, PA           |       |              |        |                                       |       | 1,941,466               |       |                                                    | 2,856,706  |                                                  |       |                    | 34,142     |              |       | 1,941,466             |       |                        | 2,890,848 |   |   | 4,832,314 |   |   | (625,505 | ) |   |   | 1970 |   |   |   | May-01 |   |   |   | 40  years |   |   |
| Dickson City Crossings  Dickson City, PA |       |              | (13,677,068 | )                                          |       | 4,264,935               |       |                                                    | 22,622,963 |                                                  |       |                    | 69,823     |              |       | 4,264,935             |       |                        | 22,692,786 |   |   | 26,957,720 |   |   | (1,863,282 | ) |   |   | 1997 |   |   |   | Sep-03 |   |   |   | 40  years |   |   |
| Dillsburg Shopping Center  Dillsburg, PA |       |              |        |                                       |       | 1,986,481               |       |                                                    | 4,665,505  |                                                  |       |                    | 8,249,899  |              |       | 1,986,481             |       |                        | 12,915,403 |   |   | 14,901,885 |   |   | (1,911,571 | ) |   |   | 2007 |   |   |   | Oct-96 |   |   |   | 40  years |   |   |
| New Garden  Kennett Square, PA           |       |              |        |                                       |       | 912,130                 |       |                                                    | 3,161,495  |                                                  |       |                    | 846,515    |              |       | 912,130               |       |                        | 4,008,010 |   |   | 4,920,140 |   |   | (1,668,365 | ) |   |   | 2001 |   |   |   | Jun-97 |   |   |   | 40  years |   |   |
| Stone Mill Plaza  Lancaster, PA          |       |              |        |                                       |       | 1,407,975               |       |                                                    | 5,650,901  |                                                  |       |                    | 215,681    |              |       | 1,407,975             |       |                        | 5,866,583 |   |   | 7,274,558 |   |   | (1,982,185 | ) |   |   | 1993 |   |   |   | Jan-94 |   |   |   | 40  years |   |   |
| Ivyridge  Philadelphia, PA               |       |              |        |                                       |       | 1,504,080               |       |                                                    | 6,026,320  |                                                  |       |                    | 6,336,002  |              |       | 1,504,080             |       |                        | 12,362,322 |   |   | 13,866,402 |   |   | (2,189,953 | ) |   |   | 2006 |   |   |   | Aug-95 |   |   |   | 40  years |   |   |
| Roosevelt Mall  Philadelphia, PA         |       |              |        |                                       |       | 2,537,378               |       |                                                    | 91,798     |                                                  |       |                    | 9,779,166  |              |       | 2,537,378             |       |                        | 9,870,964 |   |   | 12,408,341 |   |   | (7,923,598 | ) |   |   | 1988 |   |   |   | Jan-64 |   |   |   | 40  years |   |   |
|                                          |            |                   |             |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                       |            |                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

F-58

----

**NEW PLAN EXCELREALTY TRUST, INC. AND SUBSIDIARIESSCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATIONDecember 31, 2006**

| **COLUMN A**                            | ** ** | **COLUMN B** | ** **  | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**     | ** ** |                        |
|----------------------------------------------|------------|-------------------|-------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------|------------|-----------------------------|
| ** **                                   | ** ** | ** **        | ** **  | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | **Life on Which** | ** ** |   |
| ** **                                   | ** ** | ** **        | ** **  | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—** | ** ** |                        |
| ** **                                   | ** ** | ** **        | ** **  | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**       | ** ** | **Year**                    | ** ** | **Date** | ** ** | **Latest Income** | ** ** |   |
| **Description**                              | ** ** | ** **        | ** **  | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**             | ** ** | **Depreciation**            | ** ** | **Constructed** | ** ** | **Acquired** | ** ** | **Statement** | ** ** |   |
| Hampton Square  Southampton, PA              |       |              |        |                                       |       | 772,800                 |       |                                                    | 2,907,200  |                                                  |       |                    | 1,017,689  |              |       | 772,800               |       |                        | 3,924,889 |   |   | 4,697,689 |   |   | (732,394 | ) |   |   | 2002 |   |   |   | Dec-98 |   |   |   | 40  years |   |   |
| Hunt River Commons  North Kingstown, RI      |       |              | (7,291,612  | )                                          |       | 3,138,736               |       |                                                    | 9,416,208  |                                                  |       |                    | 161,016    |              |       | 3,138,736             |       |                        | 9,577,225 |   |   | 12,715,961 |   |   | (1,007,320 | ) |   |   | 1989 |   |   |   | Dec-02 |   |   |   | 40  years |   |   |
| Circle Center  Hilton Head, SC               |       |              |        |                                       |       | 1,533,330               |       |                                                    | 6,133,106  |                                                  |       |                    | 35,920     |              |       | 1,533,330             |       |                        | 6,169,026 |   |   | 7,702,356 |   |   | (1,293,940 | ) |   |   | 2000 |   |   |   | Mar-94 |   |   |   | 40  years |   |   |
| Lexington Town Square  Lexington, SC         |       |              | (133,325    | )                                          |       | 642,813                 |       |                                                    | 1,928,439  |                                                  |       |                    | 59,413     |              |       | 642,813               |       |                        | 1,987,853 |   |   | 2,630,666 |   |   | (205,754 | ) |   |   | 1995 |   |   |   | Dec-02 |   |   |   | 40  years |   |   |
| Festival Centre  North Charleston, SC        |       |              |        |                                       |       | 2,427,247               |       |                                                    | 7,281,740  |                                                  |       |                    | 1,902,898  |              |       | 2,427,247             |       |                        | 9,184,638 |   |   | 11,611,884 |   |   | (1,011,804 | ) |   |   | 2004 |   |   |   | Dec-02 |   |   |   | 40  years |   |   |
| Hillcrest Shopping Center  Spartanburg, SC   |       |              | (17,380,413 | )                                          |       | 1,189,916               |       |                                                    | 33,731,500 |                                                  |       |                    | 779,906    |              |       | 1,189,916             |       |                        | 34,511,406 |   |   | 35,701,322 |   |   | (1,754,760 | ) |   |   | 2007 |   |   |   | Feb-05 |   |   |   | 40  years |   |   |
| Shoppes at Hickory Hollow  Antioch, TN       |       |              | (10,749,390 | )                                          |       | 3,393,593               |       |                                                    | 11,438,069 |                                                  |       |                    |       |              |       | 3,393,593             |       |                        | 11,438,069 |   |   | 14,831,661 |   |   | (148,113 | ) |   |   | 1986 |   |   |   | Sep-06 |   |   |   | 40  years |   |   |
| Congress Crossing  Athens, TN                |       |              |        |                                       |       | 994,734                 |       |                                                    | 6,747,013  |                                                  |       |                    | 199,562    |              |       | 994,734               |       |                        | 6,946,575 |   |   | 7,941,309 |   |   | (2,592,846 | ) |   |   | 1990 |   |   |   | Nov-88 |   |   |   | 40  years |   |   |
| St. Elmo Central  Chattanooga, TN            |       |              |        |                                       |       | 1,529,587               |       |                                                    | 6,120,555  |                                                  |       |                    | 55,827     |              |       | 1,529,587             |       |                        | 6,176,382 |   |   | 7,705,969 |   |   | (1,273,254 | ) |   |   | 1995 |   |   |   | Aug-96 |   |   |   | 40  years |   |   |
| Saddletree Village  Columbia, TN             |       |              | (1,343,624  | )                                          |       | 685,676                 |       |                                                    | 2,900,245  |                                                  |       |                    | 30,678     |              |       | 685,676               |       |                        | 2,930,923 |   |   | 3,616,599 |   |   | (608,974 | ) |   |   | 1990 |   |   |   | Jun-98 |   |   |   | 40  years |   |   |
| West Towne Square  Elizabethton, TN          |       |              |        |                                       |       | 529,103                 |       |                                                    | 3,880,088  |                                                  |       |                    | 122,569    |              |       | 529,103               |       |                        | 4,002,657 |   |   | 4,531,760 |   |   | (931,528 | ) |   |   | 2007 |   |   |   | Jun-98 |   |   |   | 40  years |   |   |
| Greeneville Commons  Greeneville, TN         |       |              |        |                                       |       | 1,075,200               |       |                                                    | 7,934,800  |                                                  |       |                    | 680,394    |              |       | 1,075,200             |       |                        | 8,615,194 |   |   | 9,690,394 |   |   | (3,119,831 | ) |   |   | 2002 |   |   |   | Mar-92 |   |   |   | 40  years |   |   |
| Hazel Path  Hendersonville, TN               |       |              |        |                                       |       | 1,451,864               |       |                                                    | 7,644,779  |                                                  |       |                    | 32,432     |              |       | 1,451,864             |       |                        | 7,677,211 |   |   | 9,129,076 |   |   | (845,565 | ) |   |   | 1989 |   |   |   | Nov-95 |   |   |   | 40  years |   |   |
| Kimball Crossing  Kimball, TN                |       |              |        |                                       |       | 3,654,333               |       |                                                    | 15,875,659 |                                                  |       |                    | 192,256    |              |       | 3,654,333             |       |                        | 16,067,915 |   |   | 19,722,248 |   |   | (3,348,311 | ) |   |   | 1997 |   |   |   | Nov-95 |   |   |   | 40  years |   |   |
| Chapman-Ford Crossing  Knoxville, TN         |       |              |        |                                       |       | 2,367,047               |       |                                                    | 9,507,577  |                                                  |       |                    | 2,149      |              |       | 2,367,047             |       |                        | 9,509,726 |   |   | 11,876,773 |   |   | (1,980,952 | ) |   |   | 2007 |   |   |   | Dec-92 |   |   |   | 40  years |   |   |
| Farrar Place Shopping Center  Manchester, TN |       |              |        |                                       |       | 804,963                 |       |                                                    | 3,220,060  |                                                  |       |                    | 68,881     |              |       | 804,963               |       |                        | 3,288,941 |   |   | 4,093,904 |   |   | (708,507 | ) |   |   | 1989 |   |   |   | Dec-95 |   |   |   | 40  years |   |   |
| Memphis Commons  Memphis, TN                 |       |              | (18,334,949 | )                                          |       | 9,917,109               |       |                                                    | 26,693,884 |                                                  |       |                    |       |              |       | 9,917,109             |       |                        | 26,693,884 |   |   | 36,610,992 |   |   |   |   |   |   | 1997 |   |   |   | Dec-06 |   |   |   | 40  years |   |   |
| Georgetown Square  Murfreesboro, TN          |       |              |        |                                       |       | 1,166,924               |       |                                                    | 4,674,698  |                                                  |       |                    | 791,660    |              |       | 1,166,924             |       |                        | 5,466,357 |   |   | 6,633,282 |   |   | (2,000,993 | ) |   |   | 2003 |   |   |   | Sep-93 |   |   |   | 40  years |   |   |
| Apison Crossing  Ooltewah, TN                |       |              |        |                                       |       | 1,679,125               |       |                                                    | 6,716,542  |                                                  |       |                    | 27,366     |              |       | 1,679,125             |       |                        | 6,743,908 |   |   | 8,423,033 |   |   | (1,391,277 | ) |   |   | 1997 |   |   |   | Jul-97 |   |   |   | 40 years |   |   |
|                                              |            |                   |             |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                       |            |                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

 

F-59

----

**NEWPLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES**

**SCHEDULEIII—REAL ESTATE AND ACCUMULATED DEPRECIATION**

**December31, 2006**

| **COLUMN A**                          | ** ** | **COLUMN B** | ** ** | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**     | ** ** |
|--------------------------------------------|------------|-------------------|------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------|------------|
| ** **                                 | ** ** | ** **        | ** ** | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | **Life on Which** | ** ** |
| ** **                                 | ** ** | ** **        | ** ** | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—** | ** ** |
| ** **                                 | ** ** | ** **        | ** ** | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**       | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**                            | ** ** | ** **        | ** ** | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**             | ** ** | **Depreciation** | ** ** | **Constructed** | ** ** | **Acquired** | ** ** | **Statement** | ** ** |
| Madison Street Station  Shelbyville, TN    |       |              |       |                                       |       | 752,499                 |       |                                                    | 3,012,444  |                                                  |       |                    | 203,164    |              |       | 752,499               |       |   | 3,215,608 |   |   | 3,968,107 |   |   | (717,548 | ) |   |   | 1999 |   |   |   | Oct-95 |   |   |   | 40  years |   |   |
| Commerce Central  Tullahoma, TN            |       |              |       |                                       |       | 2,889,948               |       |                                                    | 12,177,046 |                                                  |       |                    | 46,703     |              |       | 2,889,948             |       |   | 12,223,749 |   |   | 15,113,697 |   |   | (2,545,430 | ) |   |   | 1995 |   |   |   | Aug-96 |   |   |   | 40  years |   |   |
| Palm Plaza  Aransas, TX                    |       |              | *          |                                       |       | 343,333                 |       |                                                    | 871,639    |                                                  |       |                    | 63,413     |              |       | 343,333               |       |   | 935,052 |   |   | 1,278,385 |   |   | (384,072 | ) |   |   | 2002 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Bardin Place Center  Arlington, TX         |       |              |       |                                       |       | 6,733,620               |       |                                                    | 27,101,486 |                                                  |       |                    | 261,240    |              |       | 6,733,620             |       |   | 27,362,726 |   |   | 34,096,346 |   |   | (6,342,764 | ) |   |   | 1993 |   |   |   | Oct-97 |   |   |   | 40  years |   |   |
| Baytown Shopping Center  Baytown, TX       |       |              | *          |                                       |       | 2,163,096               |       |                                                    | 6,720,138  |                                                  |       |                    | 13,392     |              |       | 2,163,096             |       |   | 6,733,531 |   |   | 8,896,626 |   |   | (815,434 | ) |   |   | 1987 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Cedar Bellaire  Bellaire, TX               |       |              | *          |                                       |       | 1,663,131               |       |                                                    | 2,397,528  |                                                  |       |                    | 82,298     |              |       | 1,663,131             |       |   | 2,479,826 |   |   | 4,142,956 |   |   | (306,564 | ) |   |   | 1994 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Rice Bellaire  Bellaire, TX                |       |              |       |                                       |       | 1,255,793               |       |                                                    | 2,494,516  |                                                  |       |                    |       |              |       | 1,255,793             |       |   | 2,494,516 |   |   | 3,750,309 |   |   | (311,865 | ) |   |   | 2000 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Brenham Four Corners  Brenham, TX          |       |              | *          |                                       |       | 964,224                 |       |                                                    | 6,170,922  |                                                  |       |                    | 95,499     |              |       | 964,224               |       |   | 6,266,421 |   |   | 7,230,645 |   |   | (760,244 | ) |   |   | 1997 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Bryan Square  Bryan, TX                    |       |              | *          |                                       |       | 797,369                 |       |                                                    | 641,393    |                                                  |       |                    | 20,688     |              |       | 797,369               |       |   | 662,082 |   |   | 1,459,450 |   |   | (81,047 | ) |   |   | 2001 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Townshire  Bryan, TX                       |       |              |       |                                       |       | 3,550,915               |       |                                                    | 3,078,231  |                                                  |       |                    | 103,550    |              |       | 3,550,915             |       |   | 3,181,781 |   |   | 6,732,696 |   |   | (657,555 | ) |   |   | 2002 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Culpepper Plaza  College Station, TX       |       |              |       |                                       |       | 5,695,894               |       |                                                    | 7,664,913  |                                                  |       |                    | 107,049    |              |       | 5,695,894             |       |   | 7,771,962 |   |   | 13,467,856 |   |   | (1,072,406 | ) |   |   | 2007 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Rock Prairie Crossing  College Station, TX |       |              |       |                                       |       | 2,991,802               |       |                                                    | 5,731,371  |                                                  |       |                    | 1,474,199  |              |       | 2,991,802             |       |   | 7,205,571 |   |   | 10,197,373 |   |   | (812,887 | ) |   |   | 2002 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Carmel Village  Corpus Christi, TX         |       |              | *          |                                       |       | 2,159,210               |       |                                                    | 3,805,505  |                                                  |       |                    | 40,842     |              |       | 2,159,210             |       |   | 3,846,347 |   |   | 6,005,557 |   |   | (493,515 | ) |   |   | 1993 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Five Points  Corpus Christi, TX            |       |              | *          |                                       |       | 5,429,519               |       |                                                    | 14,979,830 |                                                  |       |                    | 278,503    |              |       | 5,429,519             |       |   | 15,258,333 |   |   | 20,687,852 |   |   | (1,953,339 | ) |   |   | 1993 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Claremont Village  Dallas, TX              |       |              | *          |                                       |       | 616,854                 |       |                                                    | 2,763,528  |                                                  |       |                    | 29,175     |              |       | 616,854               |       |   | 2,792,703 |   |   | 3,409,557 |   |   | (342,792 | ) |   |   | 1976 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Jeff Davis  Dallas, TX                     |       |              | *          |                                       |       | 2,429,083               |       |                                                    | 1,794,831  |                                                  |       |                    | 383,589    |              |       | 2,429,083             |       |   | 2,178,420 |   |   | 4,607,503 |   |   | (288,303 | ) |   |   | 1975 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Stevens Park Village  Dallas, TX           |       |              | *          |                                       |       | 730,884                 |       |                                                    | 2,920,054  |                                                  |       |                    | 65,092     |              |       | 730,884               |       |   | 2,985,145 |   |   | 3,716,029 |   |   | (362,789 | ) |   |   | 1974 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Webb Royal  Dallas, TX                     |       |              | *          |                                       |       | 2,938,496               |       |                                                    | 3,569,544  |                                                  |       |                    | 246,155    |              |       | 2,938,496             |       |   | 3,815,699 |   |   | 6,754,195 |   |   | (587,174 | ) |   |   | 1992 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Wynnewood Village  Dallas, TX              |       |              | *          |                                       |       | 5,582,452               |       |                                                    | 21,580,198 |                                                  |       |                    | 4,342,360  |              |       | 5,582,452             |       |   | 25,922,558 |   |   | 31,505,010 |   |   | (3,025,662 | ) |   |   | 2006 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Parktown  Deer Park, TX                    |       |              | *          |                                       |       | 1,242,627               |       |                                                    | 5,060,049  |                                                  |       |                    | 92,954     |              |       | 1,242,627             |       |   | 5,153,003 |   |   | 6,395,630 |   |   | (891,610 | ) |   |   | 1999 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Kenworthy Crossing  El Paso, TX            |       |              |       |                                       |       | 870,748                 |       |                                                    | 4,034,680  |                                                  |       |                    | 57,987     |              |       | 870,748               |       |   | 4,092,667 |   |   | 4,963,415 |   |   | (614,009 | ) |   |   | 2003 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Yarbrough  El Paso, TX                     |       |              |       |                                       |       | 189,126                 |       |                                                    | 1,268,368  |                                                  |       |                    |       |              |       | 189,126               |       |   | 1,268,368 |   |   | 1,457,494 |   |   | (153,102 | ) |   |   | 1995 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| The Market at Preston Ridge  Frisco, TX    |       |              |       |                                       |       | 3,481,833               |       |                                                    | 5,457,663  |                                                  |       |                    |       |              |       | 3,481,833             |       |   | 5,457,663 |   |   | 8,939,496 |   |   | (721,212 | ) |   |   | 2003 |   |   |   | Sep-04 |   |   |   | 40  years |   |   |
| Forest Hills  Ft. Worth, TX                |       |              | *          |                                       |       | 283,275                 |       |                                                    | 1,669,157  |                                                  |       |                    | 74,916     |              |       | 283,275               |       |   | 1,744,072 |   |   | 2,027,348 |   |   | (257,003 | ) |   |   | 1968 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Westcliff  Ft. Worth, TX                   |       |              |       |                                       |       | 1,034,333               |       |                                                    | 5,737,121  |                                                  |       |                    | 215,345    |              |       | 1,034,333             |       |   | 5,952,466 |   |   | 6,986,799 |   |   | (757,977 | ) |   |   | 1999 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
|                                            |            |                   |            |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                       |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

F-60

----

 

**NEWPLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES**

**SCHEDULEIII—REAL ESTATE AND ACCUMULATED DEPRECIATION**

**December31, 2006**

| **COLUMN A**                                  | ** ** | **COLUMN B** | ** ** | **COLUMN C**                          | ** ** | **COLUMN D**       | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F**                                     | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**     | ** ** |
|----------------------------------------------------|------------|-------------------|------------|--------------------------------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|-------------------------------------------------------|------------|-------------------------|------------|-------------------|------------|-----------------------|------------|
| ** **                                         | ** ** | ** **        | ** ** | ** **                                 | ** ** | ** **              | ** ** | **Cost Capitalized**                               | ** ** | **Gross Amount at Which Carried** | ** ** | ** **              | ** ** | ** **        | ** ** | ** **            | ** ** | **Life on Which** | ** ** |
| ** **                                         | ** ** | ** **        | ** ** | **Initial Cost to Company** | ** ** | **Subsequent to**  | ** ** | **at the Close of the Period** | ** ** | ** **                                            | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—** | ** ** |
| ** **                                         | ** ** | ** **        | ** ** | ** **                                 | ** ** | **Building &** | ** ** | **Acquisition**                                         | ** ** | ** **                                            | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**       | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**                                    | ** ** | ** **        | ** ** | **Encumbrances**                           | ** ** | **Land**                | ** ** | **Improvements**                                        | ** ** | **Improvements**                                      | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**             | ** ** | **Depreciation** | ** ** | **Constructed** | ** ** | **Acquired** | ** ** | **Statement** | ** ** |
| Village Plaza  Garland, TX                         |       |              | *          |                                       |       | 2,887,423               |       |                                                    | 3,145,325  |                                                  |       |                    | 755,396    |              |       | 2,887,423             |       |   | 3,900,721 |   |   | 6,788,144 |   |   | (546,727 | ) |   |   | 2002 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| North Hills Village  Haltom City, TX               |       |              | *          |                                       |       | 682,122                 |       |                                                    | 1,125,729  |                                                  |       |                    | 78,391     |              |       | 682,122               |       |   | 1,204,120 |   |   | 1,886,242 |   |   | (217,595 | ) |   |   | 1998 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Highland Village Town Center  Highland Village, TX |       |              | *          |                                       |       | 2,083,370               |       |                                                    | 7,683,343  |                                                  |       |                    | 39,885     |              |       | 2,083,370             |       |   | 7,723,227 |   |   | 9,806,597 |   |   | (1,017,673 | ) |   |   | 1996 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Antoine Square  Houston, TX                        |       |              |       |                                       |       | 943,829                 |       |                                                    | 1,018,109  |                                                  |       |                    | 68,324     |              |       | 943,829               |       |   | 1,086,433 |   |   | 2,030,262 |   |   | (143,481 | ) |   |   | 2007 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Bay Forest  Houston, TX                            |       |              | *          |                                       |       | 2,168,058               |       |                                                    | 4,668,118  |                                                  |       |                    | 382,017    |              |       | 2,168,058             |       |   | 5,050,135 |   |   | 7,218,193 |   |   | (622,412 | ) |   |   | 2004 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Braes Heights  Houston, TX                         |       |              | *          |                                       |       | 5,020,312               |       |                                                    | 6,129,135  |                                                  |       |                    | 1,878,302  |              |       | 5,020,312             |       |   | 8,007,436 |   |   | 13,027,748 |   |   | (1,060,445 | ) |   |   | 2003 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Braes Link  Houston, TX                            |       |              |       |                                       |       | 1,479,647               |       |                                                    | 3,788,135  |                                                  |       |                    | 12,300     |              |       | 1,479,647             |       |   | 3,800,435 |   |   | 5,280,082 |   |   | (468,159 | ) |   |   | 1999 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Braes Oaks  Houston, TX                            |       |              | *          |                                       |       | 768,989                 |       |                                                    | 2,848,537  |                                                  |       |                    | 61,891     |              |       | 768,989               |       |   | 2,910,428 |   |   | 3,679,418 |   |   | (393,424 | ) |   |   | 1992 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Braesgate  Houston, TX                             |       |              |       |                                       |       | 1,295,575               |       |                                                    | 4,534,337  |                                                  |       |                    |       |              |       | 1,295,575             |       |   | 4,534,337 |   |   | 5,829,912 |   |   | (570,310 | ) |   |   | 1997 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Broadway  Houston, TX                              |       |              | *          |                                       |       | 958,424                 |       |                                                    | 1,465,137  |                                                  |       |                    | 24,741     |              |       | 958,424               |       |   | 1,489,878 |   |   | 2,448,302 |   |   | (274,505 | ) |   |   | 2006 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Clear Lake Camino  South Houston, TX               |       |              | *          |                                       |       | 4,028,858               |       |                                                    | 3,709,150  |                                                  |       |                    | 3,724,722  |              |       | 4,028,858             |       |   | 7,433,872 |   |   | 11,462,730 |   |   | (933,779 | ) |   |   | 2004 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Hearthstone Corners  Houston, TX                   |       |              |       |                                       |       | 5,738,446               |       |                                                    | 10,170,631 |                                                  |       |                    | 200,462    |              |       | 5,738,446             |       |   | 10,371,093 |   |   | 16,109,539 |   |   | (1,351,251 | ) |   |   | 1998 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Huntington Village  Houston, TX                    |       |              | *          |                                       |       | 2,168,536               |       |                                                    | 5,041,718  |                                                  |       |                    | 227,763    |              |       | 2,168,536             |       |   | 5,269,481 |   |   | 7,438,016 |   |   | (702,350 | ) |   |   | 2007 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Jester Village  Houston, TX                        |       |              |       |                                       |       | 1,684,456               |       |                                                    | 3,234,986  |                                                  |       |                    | 250,939    |              |       | 1,684,456             |       |   | 3,485,924 |   |   | 5,170,380 |   |   | (436,988 | ) |   |   | 1988 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Lazybrook  Houston, TX                             |       |              | *          |                                       |       | 175,162                 |       |                                                    | 648,982    |                                                  |       |                    | 57,269     |              |       | 175,162               |       |   | 706,252 |   |   | 881,414 |   |   | (89,628 | ) |   |   | 1988 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Maplewood Mall  Houston, TX                        |       |              | *          |                                       |       | 1,801,474               |       |                                                    | 2,794,194  |                                                  |       |                    | 1,276,904  |              |       | 1,801,474             |       |   | 4,071,098 |   |   | 5,872,573 |   |   | (640,489 | ) |   |   | 2004 |   |   |   | Mar-02 |   |   |   | 40  years |   |   |
| Merchants Park  Houston, TX                        |       |              |       |                                       |       | 7,373,663               |       |                                                    | 13,355,896 |                                                  |       |                    | 298,017    |              |       | 7,373,663             |       |   | 13,653,913 |   |   | 21,027,575 |   |   | (1,776,849 | ) |   |   | 2006 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
|                                                    |            |                   |            |                                            |            |                         |            |                                                         |            |                                                       |            |                         |            |                   |            |                       |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

F-61

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESSCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATIONDecember 31, 2006**

| **COLUMN A**                       | ** ** | **COLUMN B** | ** **  | **COLUMN C**                          | ** ** | **COLUMN D**         | ** ** | **COLUMN E**                                       | ** ** | **COLUMN F** | ** ** | **COLUMN G**       | ** ** | **COLUMN H** | ** ** | **COLUMN I**           | ** ** |
|-----------------------------------------|------------|-------------------|-------------|--------------------------------------------|------------|---------------------------|------------|---------------------------------------------------------|------------|-------------------|------------|-------------------------|------------|-------------------|------------|-----------------------------|------------|
| ** **                              | ** ** | ** **        | ** **  | ** **                                 | ** ** | **Cost Capitalized** | ** ** | **Gross Amount at Which Carried**   | ** ** | ** **        | ** ** | ** **              | ** ** | ** **        | ** ** | **Life on Which** | ** ** |
| ** **                              | ** ** | ** **        | ** **  | **Initial Cost to Company** | ** ** | **Subsequent to**    | ** ** | **at the Close of the Period** | ** ** | ** **        | ** ** | ** **              | ** ** | ** **        | ** ** | **Depreciated—**       | ** ** |
| ** **                              | ** ** | ** **        | ** **  | ** **                                 | ** ** | **Building &**   | ** ** | **Acquisition**                                         | ** ** | ** **        | ** ** | **Building &** | ** ** | ** **        | ** ** | **Accumulated**             | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**                         | ** ** | ** **        | ** **  | **Encumbrances**                           | ** ** | **Land**                  | ** ** | **Improvements**                                        | ** ** | **Improvements**  | ** ** | **Land**                | ** ** | **Improvements**  | ** ** | **Total**                   | ** ** | **Depreciation** | ** ** | **   Constructed   ** | ** ** | **     Acquired     ** | ** ** | **Statement** | ** ** |
| North 45 Plaza  Houston, TX             |       |              | *           |                                       |       | 2,805,052                 |       |                                                    | 3,315,044  |              |       |                    | 7,202      |              |       | 2,805,052                   |       | 3,322,246 |   | 6,127,298 |   | (507,392 | ) |   | 1975 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Northgate  Houston, TX                  |       |              | *           |                                       |       | 925,374                   |       |                                                    | 2,182,826  |              |       |                    | 19,765     |              |       | 925,374                     |       | 2,202,590 |   | 3,127,965 |   | (277,017 | ) |   | 1972 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Northshore East  Houston, TX            |       |              | *           |                                       |       | 2,412,760                 |       |                                                    | 8,483,879  |              |       |                    | 29,000     |              |       | 2,412,760                   |       | 8,512,879 |   | 10,925,639 |   | (1,167,326 | ) |   | 2001 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Northtown Plaza  Houston, TX            |       |              | *           |                                       |       | 2,919,608                 |       |                                                    | 11,751,087 |              |       |                    | 616,076    |              |       | 2,919,608                   |       | 12,367,163 |   | 15,286,771 |   | (1,557,721 | ) |   | 1990 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Northwood  Houston, TX                  |       |              |        |                                       |       | 2,538,882                 |       |                                                    | 5,613,969  |              |       |                    | 135,118    |              |       | 2,538,882                   |       | 5,749,087 |   | 8,287,970 |   | (781,604 | ) |   | 1972 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Sharpstown Plaza  Houston, TX           |       |              |        |                                       |       | 840,472                   |       |                                                    | 1,446,280  |              |       |                    | 4,590,986  |              |       | 840,472                     |       | 6,037,266 |   | 6,877,738 |   | (399,756 | ) |   | 2005 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Tanglewilde  Houston, TX                |       |              | *           |                                       |       | 6,184,663                 |       |                                                    | 1,209,944  |              |       |                    | 130,314    |              |       | 6,184,663                   |       | 1,340,258 |   | 7,524,921 |   | (219,910 | ) |   | 1998 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Tidwell Place  Houston, TX              |       |              | *           |                                       |       | 294,980                   |       |                                                    | 2,914,618  |              |       |                    | 105,122    |              |       | 294,980                     |       | 3,019,741 |   | 3,314,720 |   | (395,807 | ) |   | 1991 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Westheimer Commons  Houston, TX         |       |              | *           |                                       |       | 6,727,343                 |       |                                                    | 13,323,246 |              |       |                    | 1,425,435  |              |       | 6,727,343                   |       | 14,748,681 |   | 21,476,024 |   | (1,917,096 | ) |   | 1995 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Washington Square  Kaufman, TX          |       |              | *           |                                       |       | 449,155                   |       |                                                    | 848,867    |              |       |                    | 65,532     |              |       | 449,155                     |       | 914,399 |   | 1,363,553 |   | (269,892 | ) |   | 1978 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| League City  League City, TX            |       |              | *           |                                       |       | 2,029,894                 |       |                                                    | 2,489,822  |              |       |                    | 137,811    |              |       | 2,029,894                   |       | 2,627,633 |   | 4,657,527 |   | (316,450 | ) |   | 1992 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Jefferson Park  Mount Pleasant, TX      |       |              | *           |                                       |       | 2,677,336                 |       |                                                    | 4,558,193  |              |       |                    | 323,039    |              |       | 2,677,336                   |       | 4,881,232 |   | 7,558,568 |   | (647,921 | ) |   | 2001 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Odessa-Winwood  Town Center  Odessa, TX |       |              | (15,582,946 | )                                          |       | 3,618,061                 |       |                                                    | 24,489,502 |              |       |                    | 142,070    |              |       | 3,618,061                   |       | 24,631,572 |   | 28,249,632 |   | (145,325 | ) |   | 2002 |   |   |   | Nov-06 |   |   |   | 40 years |   |   |
| Crossroads Center  Pasadena, TX         |       |              |        |                                       |       | 2,828,017                 |       |                                                    | 10,345,485 |              |       |                    | 34,039     |              |       | 2,828,017                   |       | 10,379,524 |   | 13,207,541 |   | (1,297,638 | ) |   | 1997 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Parkview East  Pasadena, TX             |       |              | *           |                                       |       | 870,067                   |       |                                                    | 733,667    |              |       |                    | 542,099    |              |       | 870,067                     |       | 1,275,766 |   | 2,145,834 |   | (275,499 | ) |   | 2002 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Parkview West  Pasadena, TX             |       |              | *           |                                       |       | 1,208,848                 |       |                                                    | 1,547,002  |              |       |                    | 399,302    |              |       | 1,208,848                   |       | 1,946,304 |   | 3,155,151 |   | (260,877 | ) |   | 2005 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Spencer Square  Pasadena, TX            |       |              |        |                                       |       | 5,322,348                 |       |                                                    | 15,295,234 |              |       |                    | 152,823    |              |       | 5,322,348                   |       | 15,448,057 |   | 20,770,406 |   | (2,154,178 | ) |   | 1998 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Pearland Plaza  Pearland, TX            |       |              |        |                                       |       | 3,676,495                 |       |                                                    | 7,330,937  |              |       |                    | 122,674    |              |       | 3,676,495                   |       | 7,453,611 |   | 11,130,106 |   | (928,961 | ) |   | 1995 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Market Plaza  Plano, TX                 |       |              |        |                                       |       | 5,447,953                 |       |                                                    | 33,673,966 |              |       |                    |       |              |       | 5,447,953                   |       | 33,673,966 |   | 39,121,919 |   | (1,384,430 | ) |   | 2002 |   |   |   | Jul-05 |   |   |   | 40 years |   |   |
| Klein Square  Spring, TX                |       |              | *           |                                       |       | 1,279,607                 |       |                                                    | 4,111,204  |              |       |                    | 199,564    |              |       | 1,279,607                   |       | 4,310,767 |   | 5,590,374 |   | (574,826 | ) |   | 1999 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| El Camino  St. Petersburg, TX           |       |              | *           |                                       |       | 1,097,545                 |       |                                                    | 1,189,980  |              |       |                    | 122,064    |              |       | 1,097,545                   |       | 1,312,044 |   | 2,409,589 |   | (158,720 | ) |   | 1972 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Texas City Bay  Texas City, TX          |       |              | *           |                                       |       | 3,849,721                 |       |                                                    | 8,358,959  |              |       |                    | 6,330,477  |              |       | 3,849,721                   |       | 14,689,436 |   | 18,539,157 |   | (1,162,520 | ) |   | 2005 |   |   |   | Mar-02 |   |   |   | 40 years |   |   |
| Hanover Square  Mechanicsville, VA      |       |              |        |                                       |       | 1,778,701                 |       |                                                    | 7,114,805  |              |       |                    | 181,830    |              |       | 1,778,701                   |       | 7,296,635 |   | 9,075,336 |   | (2,676,503 | ) |   | 1991 |   |   |   | Jan-93 |   |   |   | 40 years |   |   |
| Jefferson Green  Newport News, VA       |       |              |        |                                       |       | 1,459,646                 |       |                                                    | 4,378,937  |              |       |                    | 77,583     |              |       | 1,459,646                   |       | 4,456,520 |   | 5,916,166 |   | (468,151 | ) |   | 1988 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| VA-KY Regional SC  Norton, VA           |       |              |        |                                       |       | 2,795,765                 |       |                                                    | 8,931,450  |              |       |                    | 215,929    |              |       | 2,795,765                   |       | 9,147,379 |   | 11,943,143 |   | (2,152,243 | ) |   | 1996 |   |   |   | Dec-92 |   |   |   | 40 years |   |   |
| Cave Spring  Corners  Roanoke, VA       |       |              |        |                                       |       | 1,064,298                 |       |                                                    | 4,257,792  |              |       |                    | 1,737,338  |              |       | 1,064,298                   |       | 5,995,130 |   | 7,059,428 |   | (1,331,846 | ) |   | 2005 |   |   |   | Jun-97 |   |   |   | 40 years |   |   |
| Lakeside Plaza  Salem, VA               |       |              |        |                                       |       | 1,370,555                 |       |                                                    | 5,355,787  |              |       |                    | 79,563     |              |       | 1,370,555                   |       | 5,435,351 |   | 6,805,906 |   | (1,038,734 | ) |   | 1989 |   |   |   | Apr-99 |   |   |   | 40 years |   |   |
| Lake Drive Plaza  Vinton, VA            |       |              |        |                                       |       | 1,362,155                 |       |                                                    | 4,616,848  |              |       |                    | 380,793    |              |       | 1,362,155                   |       | 4,997,641 |   | 6,359,796 |   | (1,492,881 | ) |   | 2001 |   |   |   | Feb-98 |   |   |   | 40 years |   |   |
| Ridgeview Centre  Wise, VA              |       |              |        |                                       |       | 2,707,679                 |       |                                                    | 4,417,792  |              |       |                    | 2,155,269  |              |       | 2,707,679                   |       | 6,573,061 |   | 9,280,740 |   | (1,929,121 | ) |   | 2005 |   |   |   | Jul-92 |   |   |   | 40 years |   |   |
| Paradise Pavilion  West Bend, WI        |       |              |        |                                       |       | 2,900,624                 |       |                                                    | 8,885,953  |              |       |                    | 58,254     |              |       | 2,900,624                   |       | 8,944,208 |   | 11,844,832 |   | (947,433 | ) |   | 2000 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
|                                         |            |                   |             |                                            |            |                           |            |                                                         |            |                   |            |                         |            |                   |            |                             |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

** **

F-62

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESSCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATIONDecember 31, 2006**

| **COLUMN A**                                  | ** ** | **COLUMN B** | ** **          | **COLUMN C**                          | ** ** | **COLUMN D**         | ** ** | **COLUMN E**                                       | ** **           | **COLUMN F** | ** ** | **COLUMN G**       | ** **         | **COLUMN H** | ** ** | **COLUMN I**           | ** ** |
|----------------------------------------------------|------------|-------------------|---------------------|--------------------------------------------|------------|---------------------------|------------|---------------------------------------------------------|----------------------|-------------------|------------|-------------------------|--------------------|-------------------|------------|-----------------------------|------------|
| ** **                                         | ** ** | ** **        | ** **          | ** **                                 | ** ** | **Cost Capitalized** | ** ** | **Gross Amount at Which Carried**   | ** **           | ** **        | ** ** | ** **              | ** **         | ** **        | ** ** | **Life on Which** | ** ** |
| ** **                                         | ** ** | ** **        | ** **          | **Initial Cost to Company** | ** ** | **Subsequent to**    | ** ** | **at the Close of the Period** | ** **           | ** **        | ** ** | ** **              | ** **         | ** **        | ** ** | **Depreciated—**       | ** ** |
| ** **                                         | ** ** | ** **        | ** **          | ** **                                 | ** ** | **Building &**   | ** ** | **Acquisition**                                         | ** **           | ** **        | ** ** | **Building &** | ** **         | ** **        | ** ** | **Accumulated**             | ** ** | **Year** | ** ** | **Date** | ** ** | **Latest Income** | ** ** |
| **Description**                                    | ** ** | ** **        | ** **          | **Encumbrances**                           | ** ** | **Land**                  | ** ** | **Improvements**                                        | ** **           | **Improvements**  | ** ** | **Land**                | ** **         | **Improvements**  | ** ** | **Total**                   | ** ** | **Depreciation** | ** ** | **   Constructed   ** | ** ** | **     Acquired     ** | ** ** | **Statement** | ** ** |
| Cheyenne Plaza  Cheyenne, WY                       |       |              | (4,701,984          | )                                          |       | 2,184,686                 |       |                                                    | 6,554,057            |              |       |                    | 46,157             |              |       | 2,184,686                   |       | 6,600,214 |   | 8,784,900 |   | (737,941 | ) |   | 1995 |   |   |   | Dec-02 |   |   |   | 40 years |   |   |
| **Other**                                          |       |              |                |                                       |       |                      |       |                                                    |                 |              |       |                    |               |              |       |                        |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| San Diego  Corporate Office  San Diego, CA         |       |              |                |                                       |       |                      |       |                                                    |                 |              |       |                    | 159,209            |              |       |                        |       | 159,209 |   | 159,209 |   | (17,920 | ) |   |   |   |   |   |   |   |   |   | 40 years |   |   |
| Apopka Commons  Apopka, FL                         |       |              |                |                                       |       | 3,079,748                 |       |                                                    |                 |              |       |                    |               |              |       | 3,079,748                   |       |   |   | 3,079,748 |   |   |   |   | 2007 |   |   |   | Sep-05 |   |   |   | LAND |   |   |
| Orlando Corporate  Office  Orlando, FL             |       |              |                |                                       |       |                      |       |                                                    |                 |              |       |                    | 274,250            |              |       |                        |       | 274,250 |   | 274,250 |   | (24,216 | ) |   |   |   |   |   |   |   |   |   | 40 years |   |   |
| Nine Mile Square  Pensacola, FL                    |       |              |                |                                       |       | 3,307,961                 |       |                                                    |                 |              |       |                    |               |              |       | 3,307,961                   |       |   |   | 3,307,961 |   |   |   |   | 2007 |   |   |   | Sep-05 |   |   |   | LAND |   |   |
| Atlanta Corporate  Office  Atlanta, GA             |       |              |                |                                       |       |                      |       |                                                    |                 |              |       |                    | 91,215             |              |       |                        |       | 91,215 |   | 91,215 |   | (25,069 | ) |   |   |   |   |   |   |   |   |   | 40 years |   |   |
| Denham Springs  Plaza  Denham Springs, LA          |       |              |                |                                       |       | 1,324,542                 |       |                                                    |                 |              |       |                    |               |              |       | 1,324,542                   |       |   |   | 1,324,542 |   |   |   |   | 2007 |   |   |   | Sep-05 |   |   |   | LAND |   |   |
| Farmington Hills  Corporate Office  Farmington, MI |       |              |                |                                       |       |                      |       |                                                    |                 |              |       |                    | 563,441            |              |       |                        |       | 563,441 |   | 563,441 |   | (113,208 | ) |   |   |   |   |   |   |   |   |   | 40 years |   |   |
| North Central  Avenue  Hartsdale, NY               |       |              |                |                                       |       | 20,238                    |       |                                                    |                 |              |       |                    |               |              |       | 20,238                      |       |   |   | 20,238 |   |   |   |   |   |   |   |   | Jul-72 |   |   |   | LAND |   |   |
| ERT Development  Corp.  New York, NY               |       |              |                |                                       |       |                      |       |                                                    | 435,000              |              |       |                    |               |              |       |                        |       | 435,000 |   | 435,000 |   | (24,524 | ) |   |   |   |   |   |   |   |   |   | 40 years |   |   |
| Excel Realty  Partners, L.P.  New York, NY         |       |              |                |                                       |       | 66,149                    |       |                                                    | 264,596              |              |       |                    |               |              |       | 66,149                      |       | 264,596 |   | 330,745 |   | (1,654 | ) |   |   |   |   |   |   |   |   |   | 40 years |   |   |
| Akron Land  Akron, OH                              |       |              |                |                                       |       | 308,030                   |       |                                                    |                 |              |       |                    |               |              |       | 308,030                     |       |   |   | 308,030 |   |   |   |   |   |   |   |   | Sep-05 |   |   |   | LAND |   |   |
| Brandt Pike Place  Dayton, OH                      |       |              |                |                                       |       | 1,663,736                 |       |                                                    |                 |              |       |                    |               |              |       | 1,663,736                   |       |   |   | 1,663,736 |   |   |   |   | 2007 |   |   |   | Sep-05 |   |   |   | LAND |   |   |
| Northgate Plaza  Westerville, OH                   |       |              |                |                                       |       | 633,106                   |       |                                                    |                 |              |       |                    |               |              |       | 633,106                     |       |   |   | 633,106 |   |   |   |   | 2007 |   |   |   | Sep-05 |   |   |   | LAND |   |   |
| Philadelphia  Corporate Office  Philadelphia, PA   |       |              |                |                                       |       |                      |       |                                                    |                 |              |       |                    | 714,251            |              |       |                        |       | 714,251 |   | 714,251 |   | (75,480 | ) |   |   |   |   |   |   |   |   |   | 40 years |   |   |
| CA New Plan Fixed  Rate Partnership  Houston, TX   |       |              | (142,534,742        | )                                          |       |                      |       |                                                    |                 |              |       |                    |               |              |       |                        |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| CA New Plan  Management  Houston, TX               |       |              |                |                                       |       |                      |       |                                                    |                 |              |       |                    | 76,180             |              |       |                        |       | 76,180 |   | 76,180 |   | (5,230 | ) |   |   |   |   |   |   |   |   |   | 40 years |   |   |
| Houston Corporate  Office  Houston, TX             |       |              |                |                                       |       |                      |       |                                                    |                 |              |       |                    | 491,894            |              |       |                        |       | 491,894 |   | 491,894 |   | (37,859 | ) |   |   |   |   |   |   |   |   |   | 40 years |   |   |
| Various                                            |       |              |                |                                       |       |                      |       |                                                    |                 |              |       |                    | 319,497,926        |              |       |                        |       | 319,497,926 |   | 319,497,926 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                               |       |              | $ (448,909,824 | )                                          |       | $ 724,596,510        |       |                                                    | $ 2,227,641,867 |              |       |                    | $ 613,515,872 |              |       | $ 724,596,510          |       | $ 2,841,157,738 |   | $ 3,565,754,248 |   | $ (430,207,368 | ) |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                    |            |                   |                     |                                            |            |                           |            |                                                         |                      |                   |            |                         |                    |                   |            |                             |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

*  Denotesproperties securing the Fixed Rate REMIC carried on the corporate entity CA NewPlan Fixed Rate Partnership.

Year constructedrepresents year of most recent redevelopment, or year built, if noredevelopment has occurred.

F-63

----

 

 

**NEW PLAN EXCELREALTY TRUST, INC. AND SUBSIDIARIESSCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATION(in thousands)**

| ** ** | ** ** | ** **                                                         | ** ** | **Year Ended  December 31, 2006** | ** ** | **Year Ended  December 31, 2005** | ** ** | **Year Ended  December 31, 2004** | ** ** |
|------------|------------|--------------------------------------------------------------------|------------|--------------------------------------------------|------------|--------------------------------------------------|------------|--------------------------------------------------|------------|
| [a]        |       | Reconciliation of total  real estate carrying value is as follows: |       |                                             |       |                                             |       |                                             |       |   |   |   |   |   |   |
|       |       | Balance at beginning of year                                       |       |                                             | $          | 3,393,078                                        |       |                                             |       | $ | 3,988,190 |   |   |   | $ | 3,654,622 |   |   |
|       |       | Acquisitions and improvements                                      |       |                                             | 291,547    |                                             |       |                                             | 369,769    |   |   |   | 407,862 |   |   |
|       |       | Impact of FIN 46 consolidation                                     |       |                                             | 18,820     |                                             |       |                                             | (8,950     | ) |   |   | 8,950 |   |   |
|       |       | Real estate held for sale                                          |       |                                             | (49,413    | )                                                |       |                                             | (78,484    | ) |   |   | (13,002 | ) |   |
|       |       | Impairment of real estate                                          |       |                                             | —     |                                             |       |                                             | (859       | ) |   |   | (2,455 | ) |   |
|       |       | Cost of property sold or transferred to joint  ventures            |       |                                             | (85,637    | )                                                |       |                                             | (875,274   | ) |   |   | (65,873 | ) |   |
|       |       | Write-off of fully depreciated assets                              |       |                                             | (2,641     | )                                                |       |                                             | (1,314     | ) |   |   | (1,914 | ) |   |
|       |       | Balance at end of year                                             |       |                                             | $          | 3,565,754                                        |       |                                             |       | $ | 3,393,078 |   |   |   | $ | 3,988,190 |   |   |
|       |       | Total cost for federal tax purposes at end of each  year           |       |                                             | $          | 3,192,731                                        |       |                                             |       | $ | 3,059,228 |   |   |   | $ | 3,371,473 |   |   |
| [b]        |       | Reconciliation of  accumulated depreciation as follows:            |       |                                             |       |                                             |       |                                             |       |   |   |   |   |   |   |
|       |       | Balance at beginning of year                                       |       |                                             | $          | 376,816                                          |       |                                             |       | $ | 428,427 |   |   |   | $ | 360,580 |   |   |
|       |       | Depreciation expense                                               |       |                                             | 75,444     |                                             |       |                                             | 69,097     |   |   |   | 82,379 |   |   |
|       |       | Impact of FIN 46 consolidation                                     |       |                                             | 202        |                                             |       |                                             | (420       | ) |   |   | 420 |   |   |
|       |       | Property sold or transferred to joint ventures                     |       |                                             | (16,393    | )                                                |       |                                             | (104,514   | ) |   |   | (11,870 | ) |   |
|       |       | Write-off of fully depreciated assets                              |       |                                             | (1,877     | )                                                |       |                                             | (716       | ) |   |   | (1,025 | ) |   |
|       |       | Real estate held for sale                                          |       |                                             | (3,985     | )                                                |       |                                             | (15,058    | ) |   |   | (2,057 | ) |   |
|       |       | Balance at end of  year                                            |       |                                             | $          | 430,207                                          |       |                                             |       | $ | 376,816 |   |   |   | $ | 428,427 |   |   |

 

F-64

----

**NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIESMORTGAGE LOANS ON REAL ESTATE(in thousands)SCHEDULE IVDecember 31, 2006**

| **COLUMN A**                                                                     | ** ** | **COLUMN B** | ** ** | **COLUMN C**               | ** ** | **COLUMN D**              | ** ** | **COLUMN E**                    | ** ** | **COLUMN F**                         | ** ** | **COLUMN G**                   | ** ** |
|---------------------------------------------------------------------------------------|------------|-------------------|------------|---------------------------------|------------|--------------------------------|------------|--------------------------------------|------------|-------------------------------------------|------------|-------------------------------------|------------|
| **Description**                                                                       | ** ** | ** **        | ** ** | **Final  Interest   Rate** | ** ** | **Face  Maturity   Date** | ** ** | **Periodic Payment Terms** | ** ** | **Prior  Liens**                          | ** ** | **Face  Amount  of Mortgages** | ** ** | **Carrying  Amount  of Mortgages** | ** ** |
| Promissory note                                                                       |       |              | 5%         |                            |       |                           | 1/31/2007  |                                 |       | Interest  and principal   payable monthly |       |                                | —     |   |   |   | $ | 1,925 |   |   |   | $ | 1,925 |   |   |
| Promissory note                                                                       |       |              | 8%         |                            |       |                           | 3/8/2007   |                                 |       | Interest  and principal   payable monthly |       |                                | —     |   |   |   | 1,820 |   |   |   | 1,820 |   |   |
| Leasehold mortgage, collateralized by a tenant lease  in D&F Plaza in Dunkirk, NY |       |              | 12%        |                            |       |                           | 5/1/2008   |                                 |       | Interest  and principal   payable monthly |       |                                | —     |   |   |   | 452 |   |   |   | 452 |   |   |
| Leasehold mortgage, collateralized by a tenant lease  in Mohawk Acres in Rome, NY     |       |              | 10%        |                            |       |                           | 5/1/2010   |                                 |       | Interest  and principal   payable monthly |       |                                | —     |   |   |   | 215 |   |   |   | 215 |   |   |
| ** **                                                                            |       |              |       |                            |       |                           |       |                                 |       |                                      |       |                                |       |   |   |   | $ | 4,412 |   |   |   | $ | 4,412 |   |   |
|                                                                                       |            |                   |            |                                 |            |                                |            |                                      |            |                                           |            |                                     |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

----

Note: Column H is not applicable

 

F-65

----

 

 

**NEW PLAN EXCELREALTY TRUST, INC. AND SUBSIDIARIESMORTGAGE LOANS ON REAL ESTATE  (in thousands)SCHEDULE IV  (continued)**

| ** **                    | ** ** | **Year Ended**             | ** ** |
|-------------------------------|------------|---------------------------------|------------|
| ** **                    | ** ** | **December 31, 2006** | ** ** | **December 31, 2005** | ** ** |
| Balance,  beginning of period |       |                            | $          | 795 |   |   |   | $ | 8,881 |   |   |
| Additions during  period:     |       |                            |       |   |   |   |   |   |   |
| New loans                     |       |                            | 3,745      |   |   |   | — |   |   |
| Reductions during  period:    |       |                            |       |   |   |   |   |   |   |
| Collection of principal       |       |                            | (128       | ) |   |   | (8,086 | ) |   |
| Balance, end of  period       |       |                            | $          | 4,412 |   |   |   | $ | 795 |   |   |

 

F-66

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**SIGNATURES**

Pursuant to therequirements of Section 13 or 15(d) of the Securities Exchange Act of1934, the registrant has duly caused this report to be signed on its behalf bythe undersigned, thereunto duly authorized.
|        |   | NEW  PLAN EXCEL REALTY TRUST, INC. |
|--------|--------|------------------------------------|
|   |   | (Registrant)                       |
|   |   | By:                                |   | /s/ GLENN J. RUFRANO |
|   |   |                               |   | Glenn J. Rufrano |
|   |   |                               |   | Chief Executive Officer |

 

Dated: February 26, 2007

Pursuantto the requirements of the Securities Exchange Act of 1934, this report hasbeen signed below by the following persons on behalf of the registrant and inthe capacities and on the dates indicated.
|                        | **Signature** | ** **                                   | ** ** | ** **             | **Title** | ** ** | ** ** | ** ** | **Date** | ** ** |
|------------------------|---------------|----------------------------------------------|------------|------------------------|-----------|------------|------------|------------|----------|------------|
| /s/ WILLIAM NEWMAN     |          | Chairman of the Board of  Directors          |       | February 26, 2007 |
| William Newman         |          |                                         |       |                   |
| /s/ GLENN J. RUFRANO   |          | Chief Executive Officer and  Director        |       | February 26, 2007 |
| Glenn J. Rufrano       |          | (principal executive officer)                |       |                   |
| /s/ JOHN B. ROCHE      |          | Chief Financial Officer  and Executive       |       | February 26, 2007 |
| John B. Roche          |          | Vice President (principal financial officer) |       |                   |
| /s/ STEVE SPLAIN       |          | Vice President and Chief  Accounting Officer |       | February 26, 2007 |
| Steven Splain          |          | (principal accounting officer)               |       |                   |
| /s/ RAYMOND H. BOTTORF |          | Director                                     |       | February 26, 2007 |
| Raymond H. Bottorf     |          |                                         |       |                   |
| /s/ IRWIN ENGELMAN     |          | Director                                     |       | February 26, 2007 |
| Irwin Engelman         |          |                                         |       |                   |
| /s/ NORMAN GOLD        |          | Director                                     |       | February 26, 2007 |
| Norman Gold            |          |                                         |       |                   |
| /s/ MATTHEW GOLDSTEIN  |          | Director                                     |       | February 26, 2007 |
| Matthew Goldstein      |          |                                         |       |                   |
| /s/ NINA MATIS         |          | Director                                     |       | February 26, 2007 |
| Nina Matis             |          |                                         |       |                   |
| /s/ H. CARL MCCALL     |          | Director                                     |       | February 26, 2007 |
| H. Carl McCall         |          |                                         |       |                   |
| /s/ MELVIN D. NEWMAN   |          | Director                                     |       | February 26, 2007 |
| Melvin D. Newman       |          |                                         |       |                   |
| /s/ GEORGE PUSKAR      |          | Director                                     |       | February 26, 2007 |
| George Puskar          |          |                                         |       |                   |
| /s/ GREGORY A. WHITE   |          | Director                                     |       | February 26, 2007 |
| Gregory A. White       |          |                                         |       |                   |

 

F-67

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**EXHIBITINDEX**
| *3.1  |   | Articles of Amendment and Restatement of the Charter  of the Company, filed as Exhibit 3.01 to Amendment No. 1 to the  Company’s Registration Statement on Form S-3, File No. 33-59195.                                                                                                                                                                                                                                              |
|-------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *3.2  |   | Articles of Amendment of  Articles of Amendment and Restatement of the Charter of the Company, filed as  Exhibit 4.4 to the Company’s Registration Statement on Form S-3,  File No. 333-65211.                                                                                                                                                                                                                                            |
| *3.3  |   | Restated Bylaws of the  Company, effective as of February 23, 2004 (incorporating all amendments  thereto through February 23, 2004), filed as Exhibit 3.3 to the  Company’s Annual Report on Form 10-K for the year ended  December 31, 2004.                                                                                                                                                                                  |
| *4.2  |   | Articles Supplementary  classifying 805,000 shares of preferred stock as 7.625% Series E  Cumulative Redeemable Preferred Stock, filed as Exhibit 4.1 to the  Company’s Current Report on Form 8-K filed on April 17, 2003.                                                                                                                                                                                                          |
| *4.3  |   | Senior Securities  Indenture, dated as of March 29, 1995, between New Plan Realty Trust and  The First National Bank of Boston, as Trustee, filed as Exhibit 4.2 to  New Plan Realty Trust’s Registration Statement on Form S-3, File  No. 33-61383.                                                                                                                                                                                 |
| *4.4  |   | First Supplemental  Indenture, dated as of August 5, 1999, by and among New Plan Realty  Trust, New Plan Excel Realty Trust, Inc. and State Street Bank and Trust  Company, filed as Exhibit 10.2 to the Company’s Quarterly Report on  Form 10-Q for the quarter ended September 30, 1999.                                                                                                                                     |
| *4.5  |   | Senior Securities  Indenture, dated as of February 3, 1999, among the Company, New Plan  Realty Trust, as guarantor, and State Street Bank and Trust Company, as  Trustee, filed as Exhibit 4.1 to the Company’s Current Report on  Form 8-K dated February 3, 1999.                                                                                                                                                                 |
| *4.6  |   | Supplemental Indenture,  dated as of December 17, 2004, by and between the Company and U.S. Bank  Trust National Association (as successor to State Street Bank and Trust  Company), as Trustee, to the Indenture dated as of February 3, 1999, by  and among the Company, New Plan Realty Trust, as guarantor, and the Trustee,  filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K  dated December 22, 2004.    |
| *4.7  |   | Senior Securities  Indenture, dated as of January 30, 2004, by and between the Company and  U.S. Bank Trust National Association, as Trustee filed as Exhibit 4.1 to  the Company’s Current Report on Form 8-K dated February 5,  2004.                                                                                                                                                                                              |
| *4.8  |   | First Supplemental  Indenture, dated as of September 19, 2006, between the Company and U.S.  Bank Trust National Association, as trustee, filed as Exhibit 4.1 to the  Company’s Current Report on Form 8-K, filed on September 19,  2006.                                                                                                                                                                                           |
| *4.9  |   | Registration Rights  Agreement, dated as of September 19, 2006, among the Company and the  Initial Purchasers named in Schedule A to the Purchase Agreement, for whom  Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith  Incorporated and Banc of America Securities LLC are acting as  representatives, filed as Exhibit 4.3 to the Company’s Current Report on  Form 8-K, filed on September 19, 2006. |
| *10.1 |   | New Plan Realty Trust  1991 Stock Option Plan, as amended, filed as Exhibit 4.2 to the  Company’s Registration Statement on Form S-8, File No. 333-65221.  †                                                                                                                                                                                                                                                                         |
| *10.2 |   | Amended and Restated  1993 Stock Option Plan of the Company, dated May 28, 1998, filed as  Exhibit 4.1 to the Company’s Registration Statement on Form S-8,  File No. 333-65223. †                                                                                                                                                                                                                                              |
| *10.3 |   | Amendment to the Amended  and Restated 1993 Stock Option Plan of the Company, dated September 28,  1998, filed as Exhibit 10.4 to the Company’s Annual Report on  Form 10-K/A for the year ended December 31, 1998. †                                                                                                                                                                                                           |

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| *10.4  |   | Amendment to the Amended  and Restated 1993 Stock Option Plan of the Company, dated February 8,  1999, filed as Exhibit 10.5 to the Company’s Annual Report on  Form 10-K/A for the year ended December 31, 1998. †                                                                       |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *10.5  |   | Amendment to the Amended  and Restated 1993 Stock Option Plan of the Company, dated April 21,  1999, filed as Exhibit 10.4 to the Company’s Annual Report on  Form 10-K for the year ended December 31, 1999. †                                                                           |
| *10.6  |   | Amendment to the Amended  and Restated 1993 Stock Option Plan of the Company, dated February 17,  2000, filed as Exhibit 10.5 to the Company’s Annual Report on  Form 10-K for the year ended December 31, 1999. †                                                                        |
| *10.7  |   | Amended and Restated  1994 Directors’ Stock Option Plan of the Company, dated May 10, 1996,  filed as Exhibit 10.8 to the Company’s Annual Report on Form 10-K/A  for the year ended December 31, 1998. †                                                                            |
| *10.8  |   | Amendment to the Amended  and Restated 1994 Directors’ Stock Option Plan of the Company, dated  September 28, 1998, filed as Exhibit 10.9 to the Company’s Annual  Report on Form 10-K/A for the year ended December 31, 1998. †                                                     |
| *10.9  |   | Amendment to the Amended  and Restated 1994 Directors’ Stock Option Plan of the Company, dated  February 17, 2000, filed as Exhibit 10.8 to the Company’s Annual  Report on Form 10-K for the year ended December 31, 1999. †                                                        |
| *10.10 |   | Amendment to the Amended  and Restated 1994 Directors’ Stock Option Plan of the Company, effective as  of May 24, 2000, filed as Exhibit 10.6 to the Company’s Quarterly  Report on Form 10-Q for the quarter ended June 30, 2000. †                                                 |
| *10.11 |   | New Plan Realty Trust  1997 Stock Option Plan, filed as Exhibit 4.1 to the Company’s  Registration Statement on Form S-8, File No. 333-65221.  †                                                                                                                                               |
| *10.12 |   | 2003 Stock Incentive  Plan of the Company, as amended and restated effective July 14, 2005,  filed as Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended September 30, 2005. †                                                                            |
| *10.13 |   | Form of Stock  Option Award pursuant to 2003 Stock Incentive Plan, filed as  Exhibit 10.1 to the Company’s Current Report on Form 8-K,  dated February 18, 2005. †                                                                                                                        |
| *10.14 |   | Form of Amendment  to Stock Option Awards pursuant to 2003 Stock Incentive Plan, filed as  Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended September 30, 2005. †                                                                                       |
| *10.15 |   | Form of Restricted  Stock Award pursuant to 2003 Stock Incentive Plan, filed as Exhibit 10.2  to the Company’s Current Report on Form 8-K, dated  February 18, 2005. †                                                                                                                    |
| *10.16 |   | Out-Performance  Compensation Plan, effective as of February 27, 2006, filed as  Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended March 31, 2006. †                                                                                                     |
| *10.17 |   | Second Amended and  Restated Revolving Credit Agreement, dated as of August 25, 2006, among  New Plan Excel Realty Trust, Inc., Bank of America, N.A. and the other  lenders party thereto, filed as Exhibit 10.1 to the Company’s Current  Report on Form 8-K, filed on August 28, 2006. |

----

 
| *10.18 |   | Second Amended and  Restated Guaranty, dated as of August 25, 2006, by and among Excel  Realty Trust—ST, Inc., CA New Plan Asset Partnership IV, L.P., CA New  Plan Texas Assets, L.P., HK New Plan Exchange Property Owner II, LP, NP of  Tennessee, L.P., HK New Plan Exchange Property Owner I, LLC, New Plan of  Illinois, LLC, New Plan of Michigan, LLC, New Plan Property Holding Company,  Pointe Orlando Development Company, New Plan Realty Trust, Excel Realty  Trust-NC and Bank of America, N.A., as administrative agent (Second Amended  and Restated Revolving Credit Agreement), filed as Exhibit 10.2 to the  Company’s Current Report on Form 8-K, filed on August 28,  2006.  |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *10.19 |   | Second Amended and  Restated Secured Term Loan Agreement, dated as of August 25, 2006, among  New Plan Excel Realty Trust, Inc., Bank of America, N.A. and the other  lenders party thereto, filed as Exhibit 10.3 to the Company’s Current  Report on Form 8-K, filed on August 28, 2006.                                                                                                                                                                                                                                                                                                                                                                                                              |
| *10.20 |   | Second Amended and  Restated Guaranty, dated as of August 25, 2006, by and among Excel  Realty Trust—ST, Inc., CA New Plan Asset Partnership IV, L.P., CA New  Plan Texas Assets, L.P., HK New Plan Exchange Property Owner II, LP, NP of  Tennessee, L.P., HK New Plan Exchange Property Owner I, LLC, New Plan of  Illinois, LLC, New Plan of Michigan, LLC, New Plan Property Holding Company,  Pointe Orlando Development Company, New Plan Realty Trust, Excel Realty  Trust-NC and Bank of America, N.A., as administrative agent (Second Amended  and Restated Secured Term Loan Agreement), filed as Exhibit 10.4 to the  Company’s Current Report on Form 8-K, filed on August 28,  2006. |
| *10.21 |   | Term Loan Agreement,  dated as of April 5, 2005, by and among the Company, Citicorp North  America, Inc., as administrative agent, and the other lenders party  thereto, filed as Exhibit 10.2 to the Company’s Quarterly Report on  Form 10-Q for the quarter ended June 30, 2005.                                                                                                                                                                                                                                                                                                                                                                                                                     |
| *10.22 |   | First Amendment to Term  Loan Agreement, dated as of July 13, 2005, by and among the Company,  Citicorp North America, Inc., as administrative agent, and the other  lenders party thereto, filed as Exhibit 10.3 to the Company’s Quarterly  Report on Form 10-Q for the quarter ended September 30, 2005.                                                                                                                                                                                                                                                                                                                                                                                             |
| *10.23 |   | Second Amendment to Term  Loan Agreement, dated as of July 19, 2005, by and among the Company,  Citicorp North America Inc., as administrative agent, and the other lenders  party thereto, filed as Exhibit 10.4 to the Company’s Quarterly Report  on Form 10-Q for the quarter ended September 30, 2005.                                                                                                                                                                                                                                                                                                                                                                                                  |
| *10.24 |   | Second Amended and  Restated Agreement of Limited Partnership of Excel Realty Partners, L.P.,  dated as of May 19, 2003, filed as Exhibit 10.2 to the Company’s  Quarterly Report on Form 10-Q for the quarter ended June 30,  2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *10.25 |   | First Amendment to  Second Amended and Restated Agreement of Limited Partnership of Excel Realty  Partners, L.P., dated as of December 7, 2004, filed as  Exhibit 10.20 to the Company’s Annual Report on Form 10-K for  the year ended December 31, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *10.26 |   | Dividend Reinvestment  and Share Purchase Plan, included in the prospectus of the Company filed  pursuant to Rule 424(b)(3), File No. 333-65211, on  April 20, 2000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 10.27  |   | New Plan Excel Realty  Trust, Inc. Deferred Compensation Plan, amended and restated as of  February 26, 2007. †                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *10.28 |   | Director Compensation  Schedule, filed as Exhibit 10.1 to the Company’s Current Report on  Form 8-K, dated February 28, 2005. †                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *10.29 |   | 2005 Compensation  Schedule for Executive Officers, filed as Exhibit 10.1 to the Company’s  Current Report on Form 8-K, filed on March 3, 2006. †                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |

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| *10.30 |   | Support Agreement, dated  as of May 14, 1998, by William Newman to the Company, filed as  Exhibit 10.7 to the Company’s Registration Statement on Form S-4,  File No. 333-61131, dated August 11, 1998. †                      |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *10.31 |   | Schedule of William  Newman’s Compensation Arrangement, filed as Exhibit 10.2 to the  Company’s Current Report on Form 8-K, dated October 28, 2005.  †                                                                                   |
| *10.32 |   | Demand Promissory Note,  dated July 1, 1997, made by Dean Bernstein in favor of the Company,  filed as Exhibit 10.23 to the Company’s Annual Report on Form 10-K  for the year ended December 31, 2002.                                       |
| *10.33 |   | Employment Agreement,  dated as of September 25, 1998, by and between the Company and Dean  Bernstein, filed as Exhibit 10.39 to the Company’s Annual Report on  Form 10-K for the year ended December 31, 2000. †                  |
| *10.34 |   | Extension Letter  concerning Employment Agreement, dated March 27, 2000, provided by the  Company to Dean Bernstein, filed as Exhibit 10.42 to the Company’s  Annual Report on Form 10-K for the year ended December 31,  2001. †   |
| *10.35 |   | Agreement, dated  May 14, 2004, by and between the Company and Dean Bernstein, filed as  Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for  the quarter ended June 30, 2004. †                                             |
| *10.36 |   | Agreement, dated as of  May 16, 2006, by and between the Company and Dean Bernstein, filed as  Exhibit 10.2 to the Company’s Current Report on Form 8-K,  filed on May 17, 2006. †                                                       |
| *10.37 |   | Demand Promissory Note, dated  June 29, 1994, made by Steven F. Siegel in favor of the Company, filed  as Exhibit 10.26 to the Company’s Annual Report on Form 10-K  for the year ended December 31, 2002.                                    |
| *10.38 |   | Demand Promissory Note,  dated July 1, 1997, made by Steven F. Siegel in favor of the Company,  filed as Exhibit 10.27 to the Company’s Annual Report on Form 10-K  for the year ended December 31, 2002.                                     |
| *10.39 |   | Employment Agreement,  dated as of September 25, 1998, by and between the Company and Steven F.  Siegel, filed as Exhibit 10.45 to the Company’s Annual Report on  Form 10-K/A for the year ended December 31, 1998. †              |
| *10.40 |   | Extension Letter  concerning Employment Agreement, dated March 27, 2000, provided by the  Company to Steven F. Siegel, filed as Exhibit 10.44 to the Company’s  Annual Report on Form 10-K for the year ended December 31,  2001. † |
| *10.41 |   | Agreement, dated  June 24, 2003, by and between the Company and Steven F. Siegel, filed as  Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended June 30, 2003. †                                          |
| *10.42 |   | Agreement, dated as of  May 16, 2006, by and between the Company and Steven F. Siegel, filed as  Exhibit 10.1 to the Company’s Current Report on Form 8-K,  filed on May 17, 2006. †                                                     |
| *10.43 |   | Employment Agreement,  dated as of March 15, 2005, by and between the Company and Glenn  Rufrano, filed as Exhibit 10.1 to the Company’s Current Report on  Form 8-K, dated March 18, 2005. †                                       |
| *10.44 |   | Stock Option Agreement,  dated as of February 23, 2000, by and between the Company and Glenn J.  Rufrano (relating to 460,976 options), filed as Exhibit 10.2 to the  Company’s Current Report on Form 8-K, dated March 9, 2000. †       |
| *10.45 |   | Stock Option Agreement,  dated as of February 23, 2000, by and between the Company and Glenn J.  Rufrano (relating to 200,000 options), filed as Exhibit 10.4 to the  Company’s Current Report on Form 8-K, dated March 9, 2000. †       |

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| *10.46               |   | Employment Agreement,  dated as of April 14, 2000, by and between the Company and John Roche,  filed as Exhibit 10.15 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended March 31, 2000. †                                                   |
|----------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *10.47               |   | Agreement, dated as of  September 27, 2002, by and between the Company and John Roche, filed as  Exhibit 10.38 to the Company’s Annual Report on Form 10-K for  the year ended December 31, 2002. †                                                             |
| *10.48               |   | Agreement, dated as of  October 24, 2005, by and between the Company and John Roche, filed as  Exhibit 10.1 to the Company’s Current Report on Form 8-K,  dated October 28, 2005. †                                                                             |
| *10.49               |   | Employment Agreement,  dated as of September 14, 2000, by and between the Company and Leonard  Brumberg, filed as Exhibit 10.1 to the Company’s Quarterly Report on  Form 10-Q for the quarter ended September 30, 2000. †                                      |
| *10.50               |   | Agreement, dated  February 12, 2003, by and between the Company and Leonard Brumberg,  filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q  for the quarter ended March 31, 2003. †                                                            |
| *10.51               |   | Agreement, dated as of  March 15, 2005, by and between the Company and Leonard Brumberg, filed  as Exhibit 10.3 to the Company’s Current Report on Form 8-K,  dated March 18, 2005.†                                                                            |
| *10.52               |   | Consulting Agreement,  dated as of May 6, 2005 (effective as of May 1, 2005), by and  between the Company and Scott MacDonald, filed as Exhibit 10.1 to the  Company’s Current Report on Form 8-K, dated May 10, 2005. †                                   |
| *10.53               |   | Employment Agreement,  dated as of March 15, 2005, by and between the Company and Michael  Carroll, filed as Exhibit 10.2 to the Company’s Current Report on  Form 8-K, dated March 18, 2005. †                                                                 |
| *10.54               |   | Contribution and Sale  Agreement, dated as of July 19, 2005, by and among the Company, certain  of its subsidiaries, Galileo America LLC and Galileo America, Inc.,  filed as Exhibit 99.3 to the Company’s Current Report on Form 8-K,  dated August 16, 2005. |
| 12.1                 |   | Ratio of Earnings to  Fixed Charges.                                                                                                                                                                                                                                                          |
| 12.2                 |   | Ratio of Earnings to  Fixed Charges and Preferred Stock Dividends.                                                                                                                                                                                                                            |
| 21    |   | Subsidiaries of the  Company.                                                                                                                                                                                                                                                                 |
| 23    |   | Consent of  PricewaterhouseCoopers LLP.                                                                                                                                                                                                                                                       |
| 31.1                 |   | Certification of Chief  Executive Officer required by Rule 13a-14(a)/15d-14(a) under  the Exchange Act, as adopted pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002.                                                                                                 |
| 31.2                 |   | Certification of Chief  Financial Officer required by Rule 13a-14(a)/15d-14(a) under  the Exchange Act, as adopted pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002.                                                                                                 |
| 32.1                 |   | Certification of Chief  Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of the  Sarbanes-Oxley Act of 2002.                                                                                                   |

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*                    Incorporatedherein by reference as above indicated.

†                    Denotes amanagement contract or compensatory plan, contract or arrangement.

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