AMENDMENT NO. 2
                        TO THE THIRD AMENDED AND RESTATED
                        AGREEMENT OF LIMITED PARTNERSHIP
                              OF PRIME RETAIL, L.P.


     This AMENDMENT NO. 2 (this  "Amendment")  to the Third Amended and Restated
Agreement of Limited  Partnership of Prime Retail,  L.P., dated as of October 1,
1998 and effective as of June 15, 1998 (the "Limited Partnership Agreement"), is
made on this the 15th day of April, 2002, and, pursuant to the Section 761(c) of
the Internal  Revenue Code of 1986 (as amended),  is effective as of the 1st day
of  January,  2001,  by and among Prime  Retail,  Inc.,  a Maryland  Corporation
("Prime Retail"),  it is capacity as both (i) a General Partner of Prime Retail,
L.P.,  a  Delaware  limited   partnership  (the   "Partnership"),   and  (ii)  a
Majority-in-Interest  of the  Partners  of the  Partnership,  Abraham  Rosenthal
("Rosenthal"),  and William H. Carpenter,  Jr. ("Carpenter").  Capitalized terms
not defined herein shall have the meanings ascribed to such terms in the Limited
Partnership Agreement.

                                   WITNESSETH:

     WHEREAS,  Rosenthal and Carpenter are agreeing to make  additional  Capital
Contributions to the Partnership under certain circumstances;

     WHEREAS,  the  parties  hereto  desire  to amend  the  Limited  Partnership
Agreement  to reflect the  obligation  of Rosenthal  and  Carpenter to make such
additional Capital Contributions;

     WHEREAS,  pursuant to Section 14.7(a) of the Limited Partnership Agreement,
Prime Retail, as General Partner and as a Majority-in-Interest  of the Partners,
hereby  consents to the  amendment of the Limited  Partnership  Agreement to set
forth below.

     NOW,  THEREFORE,  for and in  consideration  of the  terms  and  conditions
contained  herein,  and other good and valuable  consideration,  the receipt and
sufficiency of which is hereby  acknowledged,  Prime Retail,  as General Partner
and as a Majority-in-Interest of the Partners,  Rosenthal,  and Carpenter hereby
consent and agree as follows:

     1.  Amendment  to  Section  4.2.  Section  4.2 of the  Limited  Partnership
Agreement is amended by adding the following paragraph (d) after paragraph (c):

     "(d) Notwithstanding any other provision in this Agreement to the contrary,
in the  event  that (i) the loan in the  original  principal  amount  of  Ninety
Million Dollars  (90,000,000) made to the Partnership by FRIT PRT Lending LLC on
December 22, 2000 (the "Loan") becomes due and payable; and (ii) the fair market
value of the Partnership  assets that secure the Loan (the "Secured  Assets") is
below Three Million  Dollars  ($3,000,000)  (the "Minimum  Value") at such time,
William H. Carpenter,  Jr.  ("Carpenter")  and Abraham  Rosenthal  ("Rosenthal")
shall make additional  pro-rata Capital  Contributions to the Partnership  (that
is, in  addition  to those  made  pursuant  to  Section  4.2(a))  in the  amount
necessary  to cause the fair  market  value of the  Secured  Assets to equal the
Minimum Value.  The Maximum  obligation of each of Carpenter and Rosenthal under
this Section 4.2(d) (the "Required  Contribution Amount") shall be the lesser of
(i) One Million Five Hundred Thousand Dollars ($1,500,000); and (ii) one-half of
the difference between the Minimum Value and the actual fair market value of the
Secured Assets. In the event that (i) the Loan is repaid in full; (ii) Carpenter
and Rosenthal satisfy, in full, the payment of the Required Contribution Amount;
or (iii)  Carpenter  and Rosenthal no longer hold  interests in the  Partnership
(provided  that, at the time Carpenter and Rosenthal  cease to hold interests in
the  Partnership,  the fair market value of the Secured Assets is at least equal
to the Minimum  Value),  the  obligations  of  Carpenter  and  Rosenthal to make
Capital  Contributions  to the  Partnership  under  this  Section  4.2(d)  shall
immediately terminate and be of no further force or effect.  Furthermore,  Prime
Retail shall have the right,  exercisable at any time after December 1, 2002, to
terminate   the   obligation   to  Carpenter   and  Rosenthal  to  make  Capital
Contributions to the Partnership pursuant to this Section 4.2(d). Prime Retail's
termination  right  shall be  exercisable  by written  notice to  Carpenter  and
Rosenthal, and the termination shall be effective upon the date specified in the
notice.  Notwithstanding any other provision in this Agreement, if Carpenter and
Rosenthal make Capital Contributions to the Partnership pursuant to this Section
4.2(d), they shall in no event have any claim for reimbursement, indemnification
or  subrogation  against  the  General  Partner  or  any  other  partner  of the
Partnership."

     2. Miscellaneous.

     a.  Counterparts.   This  Amendment  may  be  executed  in  any  number  of
counterparts,  each of which when so executed  shall be deemed an original,  but
all such counterparts shall constitute one and the same Instrument.

     b.  Governing  Law.  This  Amendment  shall be governed by and construed in
accordance with the internal laws (as opposed to conflicts of law provisions) of
the State of Delaware.

     c. Headings.  Section  headings in this  Agreement are included  herein for
convenience  of reference only and shall not constitute a part of this Amendment
for any other purpose.

     Successors  and  Assigns.   This  Amendment   shall  be  binding  upon  the
Partnership,  each of the  Partners  of the  Partnership  and  their  respective
successors and assigns.
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     IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and
year first above written.

                                      PRIME RETAIL, INC.,
                                      as General Partner




                                      By:      /s/ Glenn D. Reschke
                                      Name:    GLENN D. RESCHKE
                                      Title: PRESIDENT, CHIEF EXECUTIVE OFFICER



                                      PRIME RETAIL, INC.,
                                      as Majority-in-Interest of the Partners




                                      By:      /s/ Glenn D. Reschke
                                      Name:    GLENN D. RESCHKE
                                      Title: PRESIDENT, CHIEF EXECUTIVE OFFICER




                                      /s/ Abraham Rosenthal
                                      ABRAHAM ROSENTHAL




                                      /s/ William H. Carpenter
                                      WILLIAM H. CARPENTER, Jr.