FORM 10-Q

Large accelerated filer

Accelerated filer

Non-accelerated filer

¨ (Do not check if a smaller reporting company)

Smaller reporting company

0001193125-13-321686.txt : 20130806 0001193125-13-321686.hdr.sgml : 20130806 20130806163217 ACCESSION NUMBER: 0001193125-13-321686 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 10 CONFORMED PERIOD OF REPORT: 20130630 FILED AS OF DATE: 20130806 DATE AS OF CHANGE: 20130806 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CEDAR REALTY TRUST, INC. CENTRAL INDEX KEY: 0000761648 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 421241468 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-31817 FILM NUMBER: 131013926 BUSINESS ADDRESS: STREET 1: 44 SOUTH BAYLES AVENUE CITY: PORT WASHINGTON STATE: NY ZIP: 11050 BUSINESS PHONE: 5167676492 MAIL ADDRESS: STREET 1: 44 SOUTH BAYLES AVENUE CITY: PORT WASHINGTON STATE: NY ZIP: 11050 FORMER COMPANY: FORMER CONFORMED NAME: CEDAR SHOPPING CENTERS INC DATE OF NAME CHANGE: 20030812 FORMER COMPANY: FORMER CONFORMED NAME: CEDAR INCOME FUND LTD /MD/ DATE OF NAME CHANGE: 20001128 FORMER COMPANY: FORMER CONFORMED NAME: UNI INVEST USA LTD DATE OF NAME CHANGE: 20000407 10-Q 1 d578685d10q.htm FORM 10-Q FORM 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2013

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER: 001-31817

CEDAR REALTY TRUST, INC.

(Exact name of registrant as specified in its charter)


Maryland		42-1241468
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)


44 South Bayles Avenue, Port Washington, New York		11050-3765
(Address of principal executive offices)		(Zip Code)

(516) 767-6492

(Registrant's telephone number, including area code)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

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

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: At July 31, 2013, there were 72,287,723 shares of Common Stock, $0.06 par value, outstanding.

CEDAR REALTY TRUST, INC.

INDEX


Forward-Looking Statements			3

Part I. Financial Information

Item 1. Financial Statements

Consolidated Balance Sheets – June 30, 2013 (unaudited) and December 31, 2012			4

Consolidated Statements of Operations (unaudited) – Three and Six months ended June 30, 2013 and 2012			5

Consolidated Statements of Comprehensive Income (Loss) (unaudited) –Three and Six months ended June 30, 2013 and 2012			6

Consolidated Statement of Equity (unaudited) – Six months ended June 30, 2013			7

Consolidated Statements of Cash Flows (unaudited) – Six months ended June 30, 2013 and 2012			8

Notes to Consolidated Financial Statements (unaudited) – June 30, 2013			9-22

Item 2. Management’s Discussion and Analysis of Financial Condition And Results of Operations			23-33

Item 3. Quantitative and Qualitative Disclosures About Market Risk			34

Item 4. Controls and Procedures			34-35

Part II. Other Information

Item 6. Exhibits			36

Signatures			36

Forward-Looking Statements

The information contained in this Form 10-Q is unaudited and does not purport to disclose all items required by accounting principles generally accepted in the United States. In addition, statements made or incorporated by reference herein may include certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and, as such, may involve known and unknown risks, uncertainties and other factors which may cause the Company’s actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements, which are based on certain assumptions and describe the Company’s future plans, strategies and expectations, are generally identifiable by use of the words “may”, “will”, “should”, “estimates”, “projects”, “anticipates”, “believes”, “expects”, “intends”, “future”, and words of similar import, or the negative thereof. Factors which could have a material adverse effect on the operations and future prospects of the Company are as set forth under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.

CEDAR REALTY TRUST, INC.

Consolidated Balance Sheets


	June 30,			December 31,
	2013			2012
	(unaudited)
Assets
Real estate:
Land	$	282,714,000		$	282,318,000
Buildings and improvements		1,182,461,000			1,178,111,000

		1,465,175,000			1,460,429,000
Less accumulated depreciation		(255,656,000	)		(237,751,000	)

Real estate, net		1,209,519,000			1,222,678,000
Real estate held for sale/conveyance		65,026,000			77,858,000
Cash and cash equivalents		4,995,000			7,522,000
Restricted cash		12,098,000			13,752,000
Receivables		19,299,000			18,289,000
Other assets and deferred charges, net		24,767,000			29,804,000

Total assets	$	1,335,704,000		$	1,369,903,000

Liabilities and equity
Mortgage loans payable	$	559,223,000		$	605,216,000
Mortgage loans payable—real estate held for sale/conveyance		18,401,000			23,258,000
Credit facility		158,000,000			156,000,000
Accounts payable and accrued liabilities		25,161,000			28,179,000
Unamortized intangible lease liabilities		28,121,000			30,508,000
Unamortized intangible lease liabilities—real estate held for sale/conveyance		4,115,000			4,992,000

Total liabilities		793,021,000			848,153,000

Noncontrolling interest—limited partners' mezzanine OP Units		644,000			623,000
Commitments and contingencies		—			—
Equity:
Cedar Realty Trust, Inc. shareholders’ equity:
Preferred stock ($.01 par value, 12,500,000 shares authorized):
Series A ($25.00 per share liquidation value, 0 and 1,410,000,shares authorized, respectively, 0 and 1,408,000 shares, issued and outstanding, respectively)		—			34,882,000
Series B ($25.00 per share liquidation value, 10,000,000 and 7,500,000 shares authorized, respectively, 7,950,000 and 5,429,000 shares, issued and outstanding, respectively)		190,661,000			128,787,000
Common stock ($.06 par value, 150,000,000 shares authorized, 72,288,000 and 71,817,000 shares, issued and outstanding, respectively)		4,337,000			4,309,000
Treasury stock (3,529,000 and 3,822,000 shares, respectively, at cost)		(20,401,000	)		(21,702,000	)
Additional paid-in capital		747,004,000			748,194,000
Cumulative distributions in excess of net income		(385,394,000	)		(378,254,000	)
Accumulated other comprehensive loss		(1,652,000	)		(2,560,000	)

Total Cedar Realty Trust, Inc. shareholders’ equity		534,555,000			513,656,000

Noncontrolling interests:
Minority interests in consolidated joint ventures		6,059,000			6,081,000
Limited partners’ OP Units		1,425,000			1,390,000

Total noncontrolling interests		7,484,000			7,471,000

Total equity		542,039,000			521,127,000

Total liabilities and equity	$	1,335,704,000		$	1,369,903,000

See accompanying notes to consolidated financial statements.

CEDAR REALTY TRUST, INC.

Consolidated Statements of Operations

(unaudited)


	Three months ended June 30,						Six months ended June 30,
	2013			2012			2013			2012
Revenues:
Rents	$	28,532,000		$	26,913,000		$	56,977,000		$	53,537,000
Expense recoveries		6,674,000			6,343,000			14,969,000			13,284,000
Other		165,000			3,642,000			388,000			4,461,000

Total revenues		35,371,000			36,898,000			72,334,000			71,282,000

Expenses:
Operating, maintenance and management		5,557,000			5,496,000			12,623,000			11,866,000
Real estate and other property-related taxes		4,526,000			4,249,000			9,123,000			8,629,000
General and administrative		3,456,000			3,737,000			6,726,000			7,362,000
Employee termination costs		—			—			106,000			—
Impairment reversal		—			—			(1,100,000	)		—
Depreciation and amortization		9,763,000			9,768,000			19,585,000			25,467,000

Total expenses		23,302,000			23,250,000			47,063,000			53,324,000

Operating income		12,069,000			13,648,000			25,271,000			17,958,000
Non-operating income and expense:
Interest expense		(9,143,000	)		(9,721,000	)		(18,245,000	)		(19,876,000	)
Early extinguishment of debt costs		(21,000	)		—			(106,000	)		(2,607,000	)
Interest income		2,000			62,000			2,000			124,000
Equity in income of unconsolidated joint venture		—			576,000			—			1,021,000
Gain on sales		—			79,000			346,000			79,000

Total non-operating income and expense		(9,162,000	)		(9,004,000	)		(18,003,000	)		(21,259,000	)

Income (loss) from continuing operations		2,907,000			4,644,000			7,268,000			(3,301,000	)
Discontinued operations:
Income (loss) from operations		281,000			958,000			(228,000	)		2,440,000
Impairment reversals, net		—			—			—			1,138,000
Gain on extinguishment of debt		1,298,000			—			1,298,000			—
Gain on sales		—			293,000			—			750,000

Total discontinued operations		1,579,000			1,251,000			1,070,000			4,328,000

Net income		4,486,000			5,895,000			8,338,000			1,027,000
Less, net loss (income) attributable to noncontrolling interests:
Minority interests in consolidated joint ventures		97,000			(662,000	)		103,000			(1,708,000	)
Limited partners' interest in Operating Partnership		(4,000	)		(8,000	)		(1,000	)		97,000

Total net loss (income) attributable to noncontrolling interests		93,000			(670,000	)		102,000			(1,611,000	)

Net income (loss) attributable to Cedar Realty Trust, Inc.		4,579,000			5,225,000			8,440,000			(584,000	)
Preferred stock dividends		(3,602,000	)		(3,607,000	)		(7,209,000	)		(7,138,000	)
Preferred stock redemption costs		—			(382,000	)		(1,166,000	)		(382,000	)

Net income (loss) attributable to common shareholders	$	977,000		$	1,236,000		$	65,000		$	(8,104,000	)

Per common share attributable to common shareholders (basic and diluted):
Continuing operations	$	(0.01	)	$	0.01		$	(0.02	)	$	(0.16	)
Discontinued operations		0.02			0.00			0.02			0.03

	$	0.01		$	0.01		$	0.00		$	(0.13	)

Amounts attributable to Cedar Realty Trust, Inc. common shareholders, net of noncontrolling interests:
(Loss) income from continuing operations	$	(596,000	)	$	779,000		$	(1,001,000	)	$	(10,520,000	)
Income from discontinued operations		1,573,000			457,000			1,066,000			2,416,000

Net income (loss)	$	977,000		$	1,236,000		$	65,000		$	(8,104,000	)

Weighted average number of common shares—basic and diluted		68,345,000			68,038,000			68,342,000			67,787,000

See accompanying notes to consolidated financial statements.

CEDAR REALTY TRUST, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited)


	Three months ended June 30,					Six months ended June 30,
	2013		2012			2013		2012
Net income	$	4,486,000	$	5,895,000		$	8,338,000	$	1,027,000

Other comprehensive income:
Unrealized gain on change in fair value of cash flow hedges:
Consolidated		570,000		21,000			910,000		309,000
Unconsolidated		—		4,000			—		58,000

Other comprehensive income		570,000		25,000			910,000		367,000

Comprehensive income		5,056,000		5,920,000			9,248,000		1,394,000
Comprehensive loss (income) attributable to noncontrolling interests		92,000		(669,000	)		100,000		(1,611,000	)

Comprehensive income (loss) attributable to Cedar Realty Trust, Inc.	$	5,148,000	$	5,251,000		$	9,348,000	$	(217,000	)

See accompanying notes to consolidated financial statements.

CEDAR REALTY TRUST, INC.

Consolidated Statement of Equity

Six months ended June 30, 2013

(unaudited)


	Cedar Realty Trust, Inc. Shareholders
	Preferred stock						Common stock										Cumulative			Accumulated
				$25.00							Treasury			Additional			distributions			other
				Liquidation					$0.06		stock,			paid-in			in excess of			comprehensive
	Shares			value			Shares		Par value		at cost			capital			net income			(loss)			Total
Balance, December 31, 2012		6,837,000		$	163,669,000			71,817,000	$	4,309,000	$	(21,702,000	)	$	748,194,000		$	(378,254,000	)	$	(2,560,000	)	$	513,656,000
Net income (loss)		—			—			—		—		—			—			8,440,000			—			8,440,000
Unrealized gain on change in fair value of cash flow hedges		—			—			—		—		—			—			—			908,000			908,000
Share-based compensation, net		—			—			468,000		28,000		1,301,000			(144,000	)		—			—			1,185,000
Net proceeds from sales of Series B shares		2,521,000			61,874,000			—		—		—			(2,025,000	)		—			—			59,849,000
Redemption of Series A shares		(1,408,000	)		(34,882,000	)		—		—		—			1,056,000			(1,166,000	)		—			(34,992,000	)
Common stock sales and issuance expenses, net		—			—			1,000		—		—			3,000			—			—			3,000
Preferred stock dividends		—			—			—		—		—			—			(7,209,000	)		—			(7,209,000	)
Distributions to common shareholders/noncontrolling interests		—			—			—		—		—			—			(7,205,000	)		—			(7,205,000	)
Conversions of OP Units into common stock		—			—			2,000		—		—			13,000			—			—			13,000
Reallocation adjustment of limited partners’ interest		—			—			—		—		—			(93,000	)		—			—			(93,000	)
Disposition of noncontrolling interest		—			—			—		—		—			—			—			—			—

Balance, June 30, 2013		7,950,000		$	190,661,000			72,288,000	$	4,337,000	$	(20,401,000	)	$	747,004,000		$	(385,394,000	)	$	(1,652,000	)	$	534,555,000



	Noncontrolling Interests
				Limited
	Minority			partners’
	interests in			interest in
	consolidated			Operating						Total
	joint ventures			Partnership			Total			equity
Balance, December 31, 2012	$	6,081,000		$	1,390,000		$	7,471,000		$	521,127,000
Net income (loss)		(103,000	)		1,000			(102,000	)		8,338,000
Unrealized gain on change in fair value of cash flow hedges		—			2,000			2,000			910,000
Share-based compensation, net		—			—			—			1,185,000
Net proceeds from sales of Series B shares		—			—			—			59,849,000
Redemption of Series A shares		—			—			—			(34,992,000	)
Common stock sales and issuance expenses, net		—			—			—			3,000
Preferred stock dividends		—			—			—			(7,209,000	)
Distributions to common shareholders/noncontrolling interests		—			(20,000	)		(20,000	)		(7,225,000	)
Conversions of OP Units into common stock		—			(13,000	)		(13,000	)		—
Reallocation adjustment of limited partners’ interest		—			65,000			65,000			(28,000	)
Disposition of noncontrolling interest		81,000			—			81,000			81,000

Balance, June 30, 2013	$	6,059,000		$	1,425,000		$	7,484,000		$	542,039,000

See accompanying notes to consolidated financial statements.

CEDAR REALTY TRUST, INC.

Consolidated Statements of Cash Flows

(unaudited)


	Six months ended June 30,
	2013			2012
Cash flow from operating activities:
Net income	$	8,338,000		$	1,027,000
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in income of unconsolidated joint venture		—			(1,021,000	)
Distributions from unconsolidated joint venture		—			1,021,000
Impairment reversals, net		(1,100,000	)		(1,138,000	)
Gain on extinguishment of debt		(1,298,000	)		—
Gain on sales		(346,000	)		(829,000	)
Straight-line rents		(894,000	)		(566,000	)
Provision for doubtful accounts		986,000			1,469,000
Depreciation and amortization		19,585,000			25,543,000
Amortization of intangible lease liabilities		(2,293,000	)		(2,990,000	)
Expense and market price adjustments relating to share-based compensation, net		1,548,000			1,554,000
Amortization (including accelerated write-off) of deferred financing costs		1,326,000			3,786,000
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:
Rents and other receivables, net		(1,705,000	)		(163,000	)
Prepaid expenses and other		1,317,000			5,584,000
Accounts payable and accrued liabilities		(1,288,000	)		(5,253,000	)

Net cash provided by operating activities		24,176,000			28,024,000

Cash flow from investing activities:
Expenditures for real estate improvements		(9,920,000	)		(11,573,000	)
Net proceeds from sales of real estate		17,381,000			16,761,000
Repayment of note receivable		1,100,000			—
Distributions of capital from unconsolidated joint venture		—			1,628,000
Construction escrows and other		2,074,000			1,446,000

Net cash provided by investing activities		10,635,000			8,262,000

Cash flow from financing activities:
Net advances/(repayments) under credit facility		2,000,000			13,183,000
Mortgage repayments		(49,689,000	)		(31,851,000	)
Payments of debt financing costs		(51,000	)		(4,268,000	)
Noncontrolling interests:
Distributions to consolidated joint venture minority interests		—			(3,566,000	)
Distributions to limited partners		(28,000	)		(71,000	)
Net proceeds from sales of common stock		3,000			(170,000	)
Net proceeds from sales of preferred stock		59,849,000			9,764,000
Redemption of preferred stock		(34,992,000	)		(9,425,000	)
Preferred stock dividends		(7,225,000	)		(7,279,000	)
Distributions to common shareholders		(7,205,000	)		(7,079,000	)

Net cash (used in) financing activities		(37,338,000	)		(40,762,000	)

Net (decrease) in cash and cash equivalents		(2,527,000	)		(4,476,000	)
Cash and cash equivalents at beginning of period		7,522,000			12,070,000

Cash and cash equivalents at end of period	$	4,995,000		$	7,594,000

See accompanying notes to consolidated financial statements.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

Note 1. Business and Organization

Cedar Realty Trust, Inc. (the “Company”) is a real estate investment trust (“REIT”) that focuses primarily on ownership and operation of grocery-anchored shopping centers straddling the Washington, DC to Boston corridor. At June 30, 2013, the Company owned and managed a portfolio of 67 operating properties (excluding properties “held for sale/conveyance”).

Cedar Realty Trust Partnership, L.P. (the “Operating Partnership”) is the entity through which the Company conducts substantially all of its business and owns (either directly or through subsidiaries) substantially all of its assets. At June 30, 2013, the Company owned a 99.6% economic interest in, and was the sole general partner of, the Operating Partnership. The limited partners’ interest in the Operating Partnership (0.4% at June 30, 2013) is represented by Operating Partnership Units (“OP Units”). The carrying amount of such interest is adjusted at the end of each reporting period to an amount equal to the limited partners’ ownership percentage of the Operating Partnership’s net equity. The approximately 279,000 OP Units outstanding at June 30, 2013 are economically equivalent to the Company’s common stock. The holders of OP Units have the right to exchange their OP Units for the same number of shares of the Company’s common stock or, at the Company’s option, for cash.

As used herein, the “Company” refers to Cedar Realty Trust, Inc. and its subsidiaries on a consolidated basis, including the Operating Partnership or, where the context so requires, Cedar Realty Trust, Inc. only.

Note 2. Summary of Significant Accounting Policies

Principles of Consolidation/Basis of Preparation

The accompanying consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and include all of the information and disclosures required by U.S. Generally Accepted Accounting Principles (“GAAP”) for interim reporting. Accordingly, they do not include all of the disclosures required by GAAP for complete financial statement disclosures. In the opinion of management, all adjustments necessary for fair presentation (including normal recurring accruals) have been included. The financial statements are prepared on the accrual basis in accordance with GAAP, which requires management to make estimates and assumptions that affect the disclosure of contingent assets and liabilities, the reported amounts of assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the periods covered by the financial statements. Actual results could differ from these estimates. The financial statements reflect certain reclassifications of prior-period amounts to conform to the 2013 presentation, principally to reflect the sale and/or treatment as “held for sale/conveyance” of certain operating properties and the treatment thereof as “discontinued operations”. The reclassifications had no impact on previously-reported net income attributable to common shareholders or earnings per share. The consolidated financial statements in this Form 10-Q should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

The consolidated financial statements include the accounts and operations of the Company, the Operating Partnership, its subsidiaries, and certain joint venture partnerships in which it participates. The Company consolidates all variable interest entities for which it is the primary beneficiary.

Supplemental Consolidated Statements of Cash Flows Information


	Six months ended June 30,
	2013		2012
Supplemental disclosure of cash activities:
Cash paid for interest	$	18,850,000	$	22,902,000
Supplemental disclosure of non-cash activities:
Capitalization of interest and deferred financing costs		587,000		745,000
Conversions of OP Units into common stock		13,000		7,895,000
Mortgage loans payable assumed by buyers		—		4,148,000

Recently-Issued Accounting Pronouncements

In February 2013, the Financial Accounting Standards Board issued guidance on the presentation and disclosure of reclassification adjustments out of accumulated other comprehensive income (“AOCI”). The standard requires an entity to present information about significant items reclassified out of AOCI by component either on the face of the statement where net income is presented or as a separate disclosure in the notes to the financial statements. The guidance is effective beginning January 1, 2013 and is to be applied on a prospective basis. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements.

Note 3. Real Estate

At June 30, 2013, substantially all of the Company’s real estate was pledged as collateral for either mortgage loans payable or the Company’s credit facility. See Note 6 – “Debt” for information relating to the amendment, on an unsecured basis, of the Company’s credit facility.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

Note 4 – Properties Held For Sale and Related Transactions

The Company conducts a continuing review of the values for all remaining properties “held for sale/conveyance” based on final sales prices and sales contracts entered into. Impairment charges/reversals, if applicable, are based on a comparison of the carrying values of the properties with either (1) actual sales prices less costs to sell for properties sold, or contract amounts for properties in the process of being sold, (2) estimated sales prices based on discounted cash flow analyses, if no contract amounts were as yet being negotiated, as discussed in more detail in Note 5 — “Fair Value Measurements”, (3) an “as is” appraisal with respect to the Philadelphia Redevelopment Property, or (4) with respect to land parcels, estimated sales prices, less cost to sell, based on comparable sales completed in the selected market areas. Prior to the Company’s plan to dispose of properties reclassified to “held for sale/conveyance”, the Company performed recoverability analyses based on the estimated undiscounted cash flows that were expected to result from the real estate investments’ use and eventual disposal. The projected undiscounted cash flows of each property reflected that the carrying value of each real estate investment would be recovered. However, as a result of the properties’ meeting the “held for sale” criteria, such properties were written down to the lower of their carrying value and estimated fair values less costs to sell.

On June 5, 2013, the Company sold, through a short sale, Westlake Discount Drug Mart Plaza for net proceeds of $2.1 million. As of that date, the balance of the mortgage loan payable secured by the sold property, including accrued interest and real estate taxes, totaled $3.4 million. The lender accepted the net proceeds of $2.1 million in full satisfaction of the mortgage loan payable and related accrued interest. As a result, the Company recorded a gain on extinguishment of debt of $1.3 million during the second quarter of 2013, which is included in discontinuing operations in the accompanying consolidated statements of operations.

As of June 30, 2013, the Company was in the process of negotiating with the respective lenders to three of its properties (Roosevelt II, Gahanna Discount Drug Mart Plaza, and McCormick Place) to convey the properties either through short sale, foreclosure, or deed-in-lieu of foreclosure processes (mortgage loans payable and accrued interest and real estate taxes aggregated $21.5 million at that date). In connection with these conveyances, each applicable subsidiary borrower has stopped paying monthly mortgage payments and is currently in default on these non-recourse mortgages. At the time of such conveyances, the Company would recognize gains (an aggregate of approximately $10.7 million as of June 30, 2013) based on the excess of the carrying amounts of the liabilities (mortgage principal and any accrued property-related expenses) over the carrying amounts of the properties.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

The following is a summary of the components of income from discontinued operations:


	Three months ended June 30,				Six months ended June 30,
	2013		2012		2013			2012
Revenues:
Rents	$	1,428,000	$	4,503,000	$	3,232,000		$	9,650,000
Expense recoveries and other		441,000		1,134,000		999,000			2,595,000

Total revenues		1,869,000		5,637,000		4,231,000			12,245,000

Expenses:
Operating, maintenance and management		661,000		1,905,000		2,075,000			3,804,000
Real estate and other property-related taxes		512,000		832,000		1,038,000			2,031,000
Depreciation and amortization		—		28,000		—			76,000
Interest		415,000		1,914,000		909,000			3,894,000
Early extinguishment of debt costs		—		—		437,000			—

Total expenses		1,588,000		4,679,000		4,459,000			9,805,000

Income (loss) from discontinued operations before impairments		281,000		958,000		(228,000	)		2,440,000
Impairment reversals, net		—		—		—			1,138,000

Income (loss) from discontinued operations	$	281,000	$	958,000	$	(228,000	)	$	3,578,000

Gain on extinguishment of debt	$	1,298,000	$	—	$	1,298,000		$	—

Gain on sales of discontinued operations	$	—	$	293,000	$	—		$	750,000

In April 2011, the Company made a two-year $4.1 million loan to the developers of a site located in Reynoldsburg, Ohio (the developers are members of the group from which the Company acquired substantially all of its drug store/convenience centers). The loan bore interest at 6.25% per annum and was collateralized by a first mortgage on the development parcel and personal guarantees from certain of the borrowers. During the fourth quarter of 2012, the borrowers failed to make a scheduled payment and, as of December 31, 2012, the Company concluded that the loan was unlikely to be paid given (1) the then ability of the developers to find an anchor tenant for the development site, (2) certain use restrictions on the land, and (3) numerous legal judgments against individuals that provided the personal guarantees. As a result, the Company wrote off the loan and accrued interest in the fourth quarter of 2012, resulting in an impairment charge of $4.4 million. Subsequently, on March 28, 2013, the borrowers sold the development land parcel for approximately $1.1 million and, simultaneously, the Company accepted $1.1 million in full satisfaction of the loan. As a result, the Company recorded an impairment reversal of $1.1 million during the first quarter of 2013, which is included in continuing operations in the accompanying consolidated statements of operations.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

During the six months ended June 30, 2013, the Company completed the following transactions related to properties “held for sale/conveyance”:


	Percent				Date		Sales		Gain on
Property	Sold			Location	Sold		Price		Sale
Discontinued operations:
East Chestnut		100	%	Lancaster, PA		1/2/2013	$	3,100,000	$	—
Columbia Mall		100	%	Bloomsburg, PA		4/17/2013	$	2,775,000	$	—
Heritage Crossing		100	%	Limerick, PA		5/9/2013	$	9,400,000	$	—
Westlake Discount Drug Mart Plaza		100	%	Westlake, OH		6/5/2013	$	2,240,000	$	—
Continuing operations:
Huntingdon Plaza land parcel		100	%	Huntingdon, PA		3/29/2013	$	390,000	$	291,000

Note 5. Fair Value Measurements

The carrying amounts of cash and cash equivalents, restricted cash, rents and other receivables, certain other assets, and accounts payable and accrued liabilities approximate fair value. The fair value of the Company’s investments and liabilities related to share-based compensation were determined to be a Level 1 within the valuation hierarchy, and were based on independent values provided by financial institutions.

The valuation of the liability for the Company’s interest rate swaps, which is measured on a recurring basis, was determined to be a Level 2 within the valuation hierarchy, and was based on independent values provided by financial institutions. Such valuations were determined using widely accepted valuation techniques, including discounted cash flow analyses, on the expected cash flows of each derivative. The analyses reflect the contractual terms of the swaps, including the period to maturity, and uses observable market-based inputs, including interest rate curves (“significant other observable inputs”). The fair value calculation also includes an amount for risk of non-performance using “significant unobservable inputs” such as estimates of current credit spreads to evaluate the likelihood of default. The Company has concluded that, as of June 30, 2013, the fair value associated with the “significant unobservable inputs” relating to the Company’s risk of non-performance was insignificant to the overall fair value of the interest rate swap agreements and, as a result, that the relevant inputs for purposes of calculating the fair value of the interest rate swap agreements, in their entirety, were based upon “significant other observable inputs”.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

Nonfinancial assets and liabilities measured at fair value in the consolidated financial statements consist of real estate held for sale/conveyance, which are measured on a nonrecurring basis, have been determined to be (1) a Level 2 within the valuation hierarchy, where applicable, based on the respective contracts of sale, adjusted for closing costs and expenses, or (2) a Level 3 within the valuation hierarchy, where applicable, based on estimated sales prices, adjusted for closing costs and expenses, determined by discounted cash flow analyses, direct capitalization analyses or a sales comparison approach if no contracts had been concluded. The discounted cash flow and direct capitalization analyses include all estimated cash inflows and outflows over a specific holding period and, where applicable, any estimated debt premiums. These cash flows were comprised of unobservable inputs which included forecasted rental revenues and expenses based upon existing in-place leases, market conditions and expectations for growth. Capitalization rates and discount rates utilized in these analyses were based upon observable rates that the Company believed to be within a reasonable range of current market rates for the respective properties. The sales comparison approach was utilized for certain land values and include comparable sales that were completed in the selected market areas. The comparable sales utilized in these analyses were based upon observable per acre rates that the Company believed to be within a reasonable range of current market rates for the respective properties.

The Company engaged third party valuation experts to assist with the preparation of certain of its valuations. Other valuations were prepared using internally-developed valuation models. In addition, these valuations are reviewed and approved, during each reporting period, by a diverse group of management, as deemed necessary, including personnel from acquisitions, accounting, finance, operations, development and leasing departments, and the valuations are updated as appropriate.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

The following tables show the hierarchy for those assets measured at fair value on a recurring basis as of June 30, 2013 and December 31, 2012, respectively:


	Assets/Liabilities Measured at Fair Value on a
	Recurring Basis
	June 30, 2013
Description	Level 1		Level 2		Level 3		Total
Investments related to share-based compensation liabilities (a)	$	396,000	$	—	$	—	$	396,000

Share-based compensation liabilities (b)	$	391,000	$	—	$	—	$	391,000

Interest rate swaps liability (b)	$	—	$	837,000	$	—	$	837,000


	December 31, 2012
Description	Level 1		Level 2		Level 3		Total
Investments related to share-based compensation liabilities (a)	$	450,000	$	—	$	—	$	450,000

Share-based compensation liabilities (b)	$	445,000	$	—	$	—	$	445,000

Interest rate swaps liability (b)	$	—	$	1,577,000	$	—	$	1,577,000

(a)	Included in other assets in the accompanying consolidated balance sheets.

(b)	Included in accounts payable and accrued liabilities in the accompanying consolidated balance sheets.

The fair value of the Company’s fixed rate mortgage loans was estimated using available market information and discounted cash flows analyses based on borrowing rates the Company believes it could obtain with similar terms and maturities. As of June 30, 2013 and December 31, 2012, the aggregate fair values of the Company’s fixed rate mortgage loans payable, which were determined to be a Level 3 within the valuation hierarchy, were approximately $519.2 million and $565.4 million, respectively; the carrying values of such loans were $499.3 million and $544.8 million, respectively.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

The following tables show the hierarchy for those assets measured at fair value on a non-recurring basis as of June 30, 2013 and December 31, 2012, respectively:


	Assets Measured at Fair Value on a
	Non-Recurring Basis
	June 30, 2013
Asset Description	Level 1		Level 2		Level 3		Total
Real estate held for sale/conveyance	$	—	$	544,000	$	64,482,000	$	65,026,000


	December 31, 2012
Asset Description	Level 1		Level 2		Level 3		Total
Real estate held for sale/conveyance	$	—	$	15,574,000	$	62,219,000	$	77,793,000

The following table details the quantitative information regarding Level 3 assets measured at fair value on a non-recurring basis as of June 30, 2013:


Quantitative Information about Level 3 Fair Value Measurements
	Fair value at		Valuation	Unobservable	Range
	June 30, 2013		Technique	inputs	(weighted average)
Real estate held for sale/conveyance:
Operating retail real estate (six properties)	$	52,566,000	Discounted cash flow	Capitalization rates	7.8% to 11.0% (8.8%)
				Discount rates	9.2% to 12.8% (9.9%)
Land development property		10,325,000	Discounted cash flow	Capitalization rate	7.3%
				Discount rate	7.8%
Land (three parcels)		1,591,000	Sales comparison approach	Price per acre	$25,000 to $156,000 per acre
					($49,000 per acre)

	$	64,482,000

Note 6. Debt

Credit Facility

On August 1, 2013, the Company amended and extended, on an unsecured basis, its credit facility. The new facility, an aggregate of $310 million, is comprised of a three-year $260 million revolving credit facility, expiring on August 1, 2016, and a five-year $50 million term loan, expiring on August 1, 2018. Subject to customary conditions, the revolving credit facility may be extended, at the Company’s option, for two additional one-year periods. Under an accordion feature, the new facility can be increased to $500 million, subject to customary conditions, and lending commitments from participating banks.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

Borrowings under the new facility are initially priced at LIBOR plus 195 bps (a weighted average rate of 2.2% per annum at closing), and can range from LIBOR plus 165 bps to 225 bps based on the Company’s leverage ratio. At the closing, the Company had $122.5 million outstanding under the revolving credit facility (reflecting a borrowing, on July 30, 2013, to pay off a property-specific mortgage) and $50.0 million outstanding under the term loan, and had $117.3 million available for additional borrowings. In connection with the transaction, the Company paid fees and legal expenses of approximately $1.7 million.

The new facility contains financial covenants including, but not limited to, maximum debt leverage, maximum secured debt, minimum interest coverage, minimum fixed charge coverage, and minimum net worth. In addition, the new facility contains restrictions including, but not limited to, limits on indebtedness, certain investments and distributions. Although the new facility is unsecured, borrowing availability is based on unencumbered property adjusted net operating income, as defined in the agreement. The Company’s failure to comply with the covenants or the occurrence of an event of default under the new facility could result in the acceleration of the related debt.

Mortgage loans payable

During the three and six months ended June 30, 2013, the Company paid off $4.7 million and $42.7 million of mortgage loans payable, respectively, of which $4.7 million and $37.3 million, respectively, represented prepayments. In this connection, during the three and six months ended June 30, 2013, the Company incurred charges relating to early extinguishment of debt (prepayment penalty and accelerated amortization of deferred financing costs) of approximately $21,000 and $543,000 (including $437,000 classified as discontinued operations), respectively.

Derivative financial instruments

At June 30, 2013, the Company had two mortgage loans payable aggregating approximately $25.7 million subject to interest rate swaps. Such interest rate swaps converted LIBOR-based variable rates to fixed rates of 5.2% and 6.5% per annum. At that date, the Company had accrued liabilities of $0.8 million (included in accounts payable and accrued liabilities on the consolidated balance sheet) relating to the fair value of interest rate swaps applicable to existing mortgage loans payable. Charges and/or credits relating to the changes in fair values of such interest rate swaps are made to accumulated other comprehensive income (loss), noncontrolling interests (minority interests in consolidated joint ventures and limited partners’ interest), or operations (included in interest expense), as appropriate.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

The following is a summary of the derivative financial instruments held by the Company at June 30, 2013 and December 31, 2012:

Notional values

Balance

Fair value

Designation/

Cash flow

Derivative

Count

June 30,
2013

Count

December 31,
2012

Maturity
dates

sheet
location

June 30,
2013

December 31,
2012

Interest
rate swaps

Accrued
liabilities

Qualifying

Consolidated

25,746,000

31,417,000

2013-2018

Consolidated

837,000

1,577,000

The following presents the effect of the Company’s derivative financial instruments on the consolidated statements of operations and the consolidated statements of equity for the three and six months ended June 30, 2013 and 2012, respectively:


			Amount of gain recognized in other
			comprehensive income (loss) (effective portion)
Designation/			Three months ended June 30,					Six months ended June 30,
Cash flow	Derivative		2013			2012		2013			2012
Qualifying		Consolidated	$	570,000	(a)	$	21,000	$	910,000	(a)	$	309,000

Qualifying		Cedar/RioCan Joint Venture	$	—		$	4,000	$	—		$	58,000

(a)	Of this amount, $310,000 and $643,000 for the three and six months ended June 30, 2013, respectively, was reclassified from other comprehensive income to interest expense in the consolidated statements of operations.

As of June 30, 2013, the Company believes it has no significant risk associated with non-performance of the financial institutions which are the counterparties to its derivative contracts. Additionally, based on the rates in effect as of June 30, 2013, if a counterparty were to default, the Company would receive a net interest benefit.

Note 7. Commitments and Contingencies

The Company is a party to certain legal actions arising in the normal course of business. Management does not expect there to be adverse consequences from these actions that would be material to the Company's consolidated financial statements.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

Note 8. Shareholders’ Equity

On February 12, 2013, the Company concluded a public offering of 2,000,000 shares of its 7.25% Series B Cumulative Redeemable Preferred Stock (“Series B Preferred Stock”) at $24.58 per share, and realized net proceeds, after offering expenses, of approximately $47.6 million. On February 12, 2013, the underwriters exercised their over-allotment option to the extent of 300,000 additional shares of the Company’s Series B Preferred Stock, and the Company realized additional net proceeds of $7.1 million.

In addition, during the three months ended March 31, 2013, the Company sold approximately 221,000 shares of its Series B Preferred Stock under the at-the-market equity program at a weighted average price of $24.52 per share, and realized net proceeds, after offering expenses, of approximately $5.2 million.

On March 11, 2013, the Company redeemed the remaining 1,408,000 shares of its 8.875% Series A Cumulative Redeemable Preferred Stock, for a total cash outlay of $35.4 million.

The following table provides a summary of dividends declared and paid per share:


	Three months ended June 30,				Six months ended June 30,
	2013		2012		2013		2012
Common stock	$	0.050	$	0.050	$	0.100	$	0.100
Cumulative Redeemable Preferred Stock:
8.875% Series A	$	—	$	0.555	$	0.555	$	1.109
7.250% Series B	$	0.453	$	—	$	0.906	$	—

On July 26, 2013, the Company’s Board of Directors declared a dividend of $0.05 per share with respect to its common stock. At the same time, the Board declared a dividend of $0.453125 per share with respect to the Company’s 7.25% Series B Preferred Stock. The distributions are payable on August 20, 2013 to shareholders of record on August 9, 2013.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

Note 9. Revenues

Rental revenues for the three and six months ended June 30, 2013 and 2012, respectively, are comprised of the following:


	Three months ended June 30,				Six months ended June 30,
	2013		2012		2013		2012
Base rents	$	26,883,000	$	24,761,000	$	53,453,000	$	49,523,000
Percentage rent		206,000		174,000		337,000		464,000
Straight-line rents		393,000		246,000		894,000		560,000
Amortization of intangible lease liabilities		1,050,000		1,732,000		2,293,000		2,990,000

Total rents	$	28,532,000	$	26,913,000	$	56,977,000	$	53,537,000

Note 10. Share-Based Compensation

The following tables set forth certain share-based compensation information for the three and six months ended June 30, 2013 and 2012, respectively:


	Three months ended June 30,						Six months ended June 30,
	2013			2012 (a)			2013			2012 (a)
Share-based compensation:
Expense relating to share grants	$	942,000		$	845,000		$	1,776,000		$	1,736,000
Adjustments to reflect changes in market price of Company’s common stock		—			(20,000	)		—			10,000
Amounts capitalized		(115,000	)		(95,000	)		(228,000	)		(192,000	)

Total charged to operations	$	827,000		$	730,000		$	1,548,000		$	1,554,000

(a)	Includes expense relating to grants previously recorded as equity and liability awards.

The Company’s 2012 Stock Incentive Plan (the “2012 Plan”) establishes the procedures for the granting of, among other things, restricted stock awards. During the three and six months ended June 30, 2013, there were 0 and 584,000 time-based restricted shares issued, respectively, with a weighted average grant date fair value of $0 and $5.65 per share, respectively. At June 30, 2013, approximately 1.8 million shares remained available for grants pursuant to the 2012 Plan.

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

Note 11. Earnings Per Share

Basic earnings per share (“EPS”) is calculated by dividing net income (loss) attributable to the Company’s common shareholders by the weighted average number of common shares outstanding for the period including participating securities (restricted shares issued pursuant to the Company’s share-based compensation program are considered participating securities, as such shares have non-forfeitable rights to receive dividends). Unvested restricted shares are not allocated net losses and/or any excess of dividends declared over net income, as such amounts are allocated entirely to the common shareholders. For the three months ended June 30, 2013 and 2012, the Company had 4.0 million and 3.1 million, respectively, of weighted average unvested restricted shares outstanding. For the six months ended June 30, 2013 and 2012, the Company had 3.8 million and 3.1 million, respectively, of weighted average unvested restricted shares outstanding. The following table provides a reconciliation of the numerator and denominator of the EPS calculations for the three and six months ended June 30, 2013 and 2012, respectively:


	Three months ended June 30,						Six months ended June 30,
	2013			2012			2013			2012
Numerator
Income (loss) from continuing operations	$	2,907,000		$	4,644,000		$	7,268,000		$	(3,301,000	)
Preferred stock dividends		(3,602,000	)		(3,607,000	)		(7,209,000	)		(7,138,000	)
Preferred stock redemption costs		—			(382,000	)		(1,166,000	)		(382,000	)
Net loss attributable to noncontrolling interests		99,000			124,000			106,000			301,000
Net earnings allocated to unvested shares		(198,000	)		(295,000	)		(371,000	)		(448,000	)

(Loss) income from continuing operations attributable to common shareholders		(794,000	)		484,000			(1,372,000	)		(10,968,000	)
Results from discontinued operations, net of noncontrolling interests		1,573,000			457,000			1,066,000			2,416,000

Net income (loss) attributable to common shareholders, basic and diluted	$	779,000		$	941,000		$	(306,000	)	$	(8,552,000	)

Denominator
Weighted average number of vested common shares outstanding		68,345,000			68,038,000			68,342,000			67,787,000

Earnings (loss) per common share, basic and fully diluted
Continuing operations	$	(0.01	)	$	0.01		$	(0.02	)	$	(0.16	)
Discontinued operations		0.02		$	0.00			0.02		$	0.03

	$	0.01		$	0.01		$	0.00		$	(0.13	)

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

June 30, 2013

(unaudited)

Fully-diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into shares of common stock. The net loss attributable to noncontrolling interests of the Operating Partnership has been excluded from the numerator and the related OP Units have been excluded from the denominator for the purpose of calculating diluted EPS as there would have been no effect had such amounts been included. The weighted average number of OP Units outstanding was 281,000 and 462,000 for the three months ended June 30, 2013 and 2012, respectively, and 281,000 and 637,000 for the six months ended June 30, 2013 and 2012, respectively. In addition, warrants for the purchase of OP Units, which expired on May 31, 2012, have been excluded as they were anti-dilutive for all applicable periods.

Note 12. Subsequent Events

In determining subsequent events, management reviewed all activity from July 1, 2013 through the date of filing this Quarterly Report on Form 10-Q.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the Company’s consolidated financial statements and related notes thereto included elsewhere in this report.

Executive Summary

The Company is a fully-integrated real estate investment trust which focuses primarily on ownership and operation of grocery-anchored shopping centers straddling the Washington DC to Boston corridor. At June 30, 2013, the Company owned and managed a portfolio of 67 operating properties (excluding properties “held for sale/conveyance”) totaling approximately 9.8 million square feet of gross leasable area (“GLA”). The portfolio was 92.7% leased and 92.0% occupied at June 30, 2013.

The Company derives substantially all of its revenues from rents and operating expense reimbursements received pursuant to long-term leases. The Company’s operating results therefore depend on the ability of its tenants to make the payments required by the terms of their leases. The Company focuses its investment activities on grocery-anchored community shopping centers. The Company believes that, because of the need of consumers to purchase food and other staple goods and services generally available at such centers, its type of “necessities-based” properties should provide relatively stable revenue flows even during difficult economic times.

Results of Operations

Comparison of three months ended June 30, 2013 and 2012


							Change
	2013			2012			Dollars			Percent
Revenues	$	35,371,000		$	36,898,000		$	(1,527,000	)		-4.1	%
Property operating expenses		10,083,000			9,745,000			338,000			3.5	%

Property operating income		25,288,000			27,153,000			(1,865,000	)		-6.9	%
General and administrative		(3,456,000	)		(3,737,000	)		281,000			-7.5	%
Depreciation and amortization		(9,763,000	)		(9,768,000	)		5,000			-0.1	%
Interest expense		(9,143,000	)		(9,721,000	)		578,000			-5.9	%
Early extinguishment of debt costs		(21,000	)		—			(21,000	)		n/a
Interest income		2,000			62,000			(60,000	)		-96.8	%
Equity in income of unconsolidated joint venture		—			576,000			(576,000	)		-100.0	%
Gain on sale		—			79,000			(79,000	)		n/a

Income from continuing operations		2,907,000			4,644,000			(1,737,000	)
Discontinued operations:
Income from operations		281,000			958,000			(677,000	)		-70.7	%
Gain on extinguishment of debt		1,298,000			—			1,298,000			n/a
Gain on sales		—			293,000			(293,000	)		n/a

Net income		4,486,000			5,895,000			(1,409,000	)
Net (loss) income attributable to noncontrolling interests		(93,000	)		670,000			(763,000	)

Net income attributable to Cedar Realty Trust, Inc.	$	4,579,000		$	5,225,000		$	(646,000	)

Properties held in both periods. The Company held 66 properties (excluding properties “held for sale/conveyance”) during the three months ended June 30, 2013 and 2012.

Revenues were lower primarily as a result of (1) a decrease in lease termination fee income from a tenant which vacated its space during the three months ended June 30, 2012 ($3.0 million), and (2) a decrease in management fee income related to the Cedar/RioCan joint venture ($0.5 million); the management agreement was terminated effective January 31, 2013, off-set by (3) rental revenues and expense recoveries at a property acquired in the fourth quarter of 2012 ($1.8 million), and (4) increases in rental revenues and expense recoveries at re-development properties ($0.2 million).

Property operating expenses were higher primarily as a result of property operating expenses at a property acquired in the fourth quarter of 2012 ($0.4 million), offset by (1) a decrease in payroll and related benefits and costs ($0.1 million), and (2) a decrease in bad debt expense ($0.1 million).

General and administrative expenses were lower primarily as a result of decreases in payroll and related benefits resulting from employee headcount reductions implemented by management in the latter part of 2012.

Depreciation and amortization expenses were consistent as a result of the completion of scheduled depreciation and amortization, offset by the acquisition of a property in the fourth quarter of 2012.

Interest expense decreased primarily as a result of (1) a lower overall weighted average interest rate ($0.5 million), and (2) a decrease in the principal balance of outstanding debt ($0.3 million), offset by a decrease in the amount of interest capitalized ($0.2 million).

Equity in income of unconsolidated joint venture in 2012 relates to the Cedar/RioCan joint venture, which the Company exited in October 2012.

Gain on sale in 2012 relates to the sale of a land parcel treated as “held for sale/conveyance”.

Discontinued operations for 2013 and 2012 include the results of operations, gain on extinguishment of debt, and gain on sales for properties sold or treated as “held for sale/conveyance”, as more fully discussed elsewhere in this report.

Comparison of six months ended June 30, 2013 and 2012


							Change
	2013			2012			Dollars			Percent
Revenues	$	72,334,000		$	71,282,000		$	1,052,000			1.5	%
Property operating expenses		21,746,000			20,495,000			1,251,000			6.1	%

Property operating income		50,588,000			50,787,000			(199,000	)		-0.4	%
General and administrative		(6,726,000	)		(7,362,000	)		636,000			-8.6	%
Employee termination costs		(106,000	)		—			(106,000	)		n/a
Impairment reversal		1,100,000			—			1,100,000			n/a
Depreciation and amortization		(19,585,000	)		(25,467,000	)		5,882,000			-23.1	%
Interest expense		(18,245,000	)		(19,876,000	)		1,631,000			-8.2	%
Early extinguishment of debt costs		(106,000	)		(2,607,000	)		2,501,000			n/a
Interest income		2,000			124,000			(122,000	)		-98.4	%
Equity in income of unconsolidated joint venture		—			1,021,000			(1,021,000	)		-100.0	%
Gain on sales		346,000			79,000			267,000			n/a

Income (loss) from continuing operations		7,268,000			(3,301,000	)		10,569,000
Discontinued operations:
(Loss) income from operations		(228,000	)		2,440,000			(2,668,000	)		-109.3	%
Impairment reversals, net		—			1,138,000			(1,138,000	)		n/a
Gain on extinguishment of debt		1,298,000			—			1,298,000			n/a
Gain on sales		—			750,000			(750,000	)		n/a

Net income		8,338,000			1,027,000			7,311,000
Net (loss) income attributable to noncontrolling interests		(102,000	)		1,611,000			(1,713,000	)

Net income (loss) attributable to Cedar Realty Trust, Inc.	$	8,440,000		$	(584,000	)	$	9,024,000

Properties held in both periods. The Company held 66 properties (excluding properties “held for sale/conveyance”) during the six months ended June 30, 2013 and 2012.

Revenues were higher primarily as a result of (1) rental revenues and expense recoveries at a property acquired in the fourth quarter of 2012 ($3.6 million), (2) increases in rental revenues and expense recoveries at the Company’s operating properties ($1.2 million), and (3) increases in rental revenues and expense recoveries at re-development properties ($0.3 million), offset by (4) a decrease in lease termination fee income from a tenant which vacated its space during the six months ended June 30, 2012 ($3.0 million), and (5) a decrease in management fee income relating to the Cedar/RioCan joint venture ($1.0 million); the management agreement was terminated effective January 31, 2013.

Property operating expenses were higher primarily as a result of (1) property operating expenses at a property acquired in the fourth quarter of 2012 ($1.0 million), and (2) an increase in snow removal costs ($0.9 million), offset by (3) a decrease in payroll and related benefits and costs ($0.6 million), and (4) a decrease in bad debt expense ($0.1 million).

Impairment reversal in 2013 relates to the partial cash recovery on a loan receivable previously written off, as more fully discussed elsewhere in this report.

Depreciation and amortization expenses were lower primarily as a result of (1) the lease up of a vacant space at a redevelopment property in 2012 which required the demolition of an existing building and the related accelerated depreciation expense ($6.2 million), and (2) the completion of scheduled depreciation and amortization ($1.0 million), offset by the acquisition of a property in the fourth quarter of 2012 ($1.4 million).

Interest expense decreased primarily as a result of (1) a lower overall weighted average interest rate ($1.4 million), and (2) a decrease in the principal balance of outstanding debt ($0.3 million), offset by a decrease in the amount of interest capitalized ($0.2 million).

Early extinguishment of debt costs in 2013 relates to the write-off of unamortized fees associated with prepaid mortgage loans payable. Early extinguishment of debt costs in 2012 relates to the write-off of unamortized fees associated with the Company’s prior credit facilities.

Equity in income of unconsolidated joint venture in 2012 relates to the Cedar/RioCan joint venture, which the Company exited in October 2012.

Gain on sales in 2013 and 2012 relates to the sale of land parcels treated as “held for sale/conveyance”.

Discontinued operations for 2013 and 2012 include the results of operations, impairment reversals, gain on extinguishment of debt, and gain on sales for properties sold or treated as “held for sale/conveyance”, as more fully discussed elsewhere in this report.

Same-Property Net Operating Income

Same-property net operating income (“same-property NOI”) is a widely-used non-GAAP financial measure for REITs that the Company believes, when considered with financial statements prepared in accordance with GAAP, is useful to investors as it provides an indication of the recurring cash generated by the Company’s properties by excluding certain non-cash revenues and expenses, as well as other infrequent items such as lease termination income which tends to fluctuate more than rents from period to period. Properties are included in same-property NOI if they are owned and operated for the entirety of both periods being compared, except for properties undergoing significant redevelopment and expansion until such properties have stabilized, and properties classified as “held for sale/conveyance”. Consistent with the capital treatment of such costs under GAAP, tenant improvements, leasing commissions and other direct leasing costs are excluded from same-property NOI.

Same-property NOI should not be considered as an alternative to net income prepared in accordance with GAAP or as a measure of liquidity. Further, same-property NOI is a measure for which there is no standard industry definition and, as such, it is not consistently defined or reported on among the Company’s peers, and thus may not provide an adequate basis for comparison between REITs. The following table reconciles same-property NOI to the Company’s consolidated operating income.


	Three months ended June 30,						Six months ended June 30,
	2013			2012			2013			2012
Consolidated operating income	$	12,069,000		$	13,648,000		$	25,271,000		$	17,958,000
Add:
General and administrative		3,456,000			3,737,000			6,726,000			7,362,000
Employee termination costs		—			—			106,000			—
Impairment reversal		—			—			(1,100,000	)		—
Depreciation and amortization		9,763,000			9,768,000			19,585,000			25,467,000
Corporate costs included in property expenses		1,276,000			1,367,000			2,661,000			3,228,000
Less:
Management fee income		—			(631,000	)		(191,000	)		(1,277,000	)
Straight-line rents		(393,000	)		(246,000	)		(894,000	)		(560,000	)
Amortization of intangible lease liabilities		(1,050,000	)		(1,732,000	)		(2,293,000	)		(2,990,000	)
Internal management fees charged to properties		(920,000	)		(855,000	)		(1,813,000	)		(1,713,000	)
Other		(242,000	)		(3,045,000	)		(386,000	)		(3,011,000	)

Consolidated NOI		23,959,000			22,011,000			47,672,000			44,464,000
Less NOI related to properties not defined as same-property		(4,508,000	)		(2,755,000	)		(8,669,000	)		(5,688,000	)

Same-property NOI	$	19,451,000		$	19,256,000		$	39,003,000		$	38,776,000

Number of same properties		61						61
Same-property occupancy, end of period		93.4	%		92.5	%		93.4	%		92.5	%
Same-property leased, end of period		93.9	%		93.8	%		93.9	%		93.8	%
Same-property average base rent, end of period	$	12.20		$	12.05		$	12.20		$	12.05

Same-property NOI for the comparative three and six month periods increased by 1.0% and 0.6%, respectively. The results reflect an increase in average base rent at the properties of $0.15, offset by the negative impact of replacing the dark anchor at Oakland Commons, located in Bristol, Connecticut. By excluding the down time impact prior to Wal-Mart taking possession of the space, same-property NOI growth would have increased to 1.4% and 1.3% for the comparative three and six month periods, respectively. Results for the six months ended June 30, 2013 were also negatively impacted by significantly higher snow removal costs. If snow removal costs for 2013 were the same as 2012, same-property NOI for the six months ended June 30, 2013 would have increased to 1.6%.

Leasing Activity

The following is a summary of the Company’s leasing activity during the six months ended June 30, 2013:


												Tenant
	Leases				New rent		Prior rent		Cash basis			improvements
	signed		GLA		per sq.ft. ($)		per sq.ft. ($)		% change			per sq.ft. ($) (a)
Renewals		51		451,200		12.91		11.86		8.9	%		0.00
New Leases - Comparable		18		55,000		14.94		13.02		14.8	%		24.76
New Leases - Non-Comparable		8		68,700		8.84		n/a		n/a			8.61

Total (b)		77		574,900		12.62		n/a		n/a			3.40

(a)	Includes tenant allowance and landlord work. Excludes first generation space.

(b)	For the six months ended June 30, 2013, legal fees and lease commissions averaged a combined total of $2.38 per square foot.

Liquidity and Capital Resources

The Company funds operating expenses and other short-term liquidity requirements, including debt service, tenant improvements, leasing commissions, preferred and common stock dividend distributions and distributions to minority interest partners, if made, primarily from its operations. The Company may also use its credit facility for these purposes. The Company expects to fund long-term liquidity requirements for property acquisitions, redevelopment costs, remaining development costs, capital improvements, joint venture requirements, and maturing debt initially with its credit facility, and ultimately through a combination of issuing and/or assuming additional mortgage debt, the sale of equity securities, the issuance of additional OP Units, and/or the sale of properties. Although the Company believes it has access to secured and unsecured financing, there can be no assurance that the Company will have the availability of mortgage financing on completed development projects, additional construction financing, or proceeds from the refinancing of existing debt.

Debt is comprised of the following at June 30, 2013:


			Interest rates
Description	Balance outstanding		Weighted - average			Range
Fixed-rate mortgages (a)	$	499,272,000		5.5	%		3.1% -7.5%
Variable-rate mortgage		59,951,000		3.0	%

Total property-specific mortgages		559,223,000		5.2	%
Credit facility		158,000,000		2.8	%

	$	717,223,000		4.7	%

(a)	At June 30, 2013, the Company had two mortgage loans payable aggregating approximately $25.7 million subject to interest rate swaps which converted LIBOR-based variable rates to fixed annual rates of 5.2% and 6.5% per annum.

Property-specific mortgage loans payable at June 30, 2013 consisted of fixed-rate notes totaling $499.3 million, with a weighted average interest rate of 5.5%, and a LIBOR-based variable-rate note totaling $60.0 million, with an effective interest rate of 3.0% per annum at that date. For the remainder of 2013, the Company has approximately $4.4 million of scheduled debt principal amortization payments and a scheduled balloon payment of $13.7 million.

Mortgage loans payable and the credit facility have an overall weighted average interest rate of 4.7% (4.5% after the amendment to the credit facility) and mature at various dates through 2029. The terms of several of the Company’s mortgage loans payable require the Company to deposit certain replacement and other reserves with its lenders. Such “restricted cash” is generally available only for property-level requirements for which the reserves have been established, and is not available to fund other property-level or Company-level obligations.

In February 2013, the Company concluded a public offering of 2.3 million shares of its Series B Preferred Stock (including 0.3 million shares relating to the exercise by the underwriters of their over-allotment option) and realized net proceeds, after offering expenses, of $54.7 million. In March 2013, the Company redeemed all of the remaining 1.4 million shares of its Series A Preferred Stock, for a total cash outlay of $35.4 million.

In order to continue qualifying as a REIT, the Company is required to distribute at least 90% of its “REIT taxable income”, as defined in the Internal Revenue Code of 1986, as amended (the “Code”). The Company paid common stock dividends totaling $0.20 per share during 2012. The Company intends to pay a target rate of $0.05 per share (annual rate of $0.20 per share) during 2013. While the Company intends to continue paying regular quarterly dividends, future dividend declarations will continue to be at the discretion of the Board of Directors, and will depend on the cash flow and financial condition of the Company, capital requirements, annual distribution requirements under the REIT provisions of the Code, and such other factors as the Board of Directors may deem relevant.

Net Cash Flows


	June 30,
	2013			2012
Cash flows provided by (used in):
Operating activities	$	24,176,000		$	28,024,000
Investing activities	$	10,635,000		$	8,262,000
Financing activities	$	(37,338,000	)	$	(40,762,000	)

Operating Activities

Net cash provided by operating activities, before net changes in operating assets and liabilities, decreased to $25.9 million for the six months ended June 30, 2013 from $27.9 million for the six months ended June 30, 2012, reflecting the reduced results from properties sold and the Company’s exit for the Cedar/RioCan joint venture. The comparative net changes in operating assets and liabilities were primarily the result of increased unbilled snow removal costs.

Investing Activities

Net cash flows provided by investing activities were primarily the result of the Company’s property disposition activities and expenditures for property improvements. During the six months ended June 30, 2013, the Company received proceeds from sales of properties treated as discontinued operations ($17.4 million), proceeds released from escrows ($2.1 million), and the repayment of a note receivable ($1.1 million), offset by expenditures for property improvements ($9.9 million). During the six months ended June 30, 2012, the Company received proceeds from the sale of real estate ($16.8 million), had distributions of capital from an unconsolidated joint venture ($1.6 million), and proceeds released from escrows ($1.4 million), offset by expenditures for property improvements ($11.6 million).

Financing Activities

During the six months ended June 30, 2013, the Company had repayments of mortgage obligations ($49.7 million), the redemption of the 8.875% Series A Cumulative Redeemable Preferred Stock ($35.0 million), and preferred and common stock distributions ($14.4 million), offset by proceeds from the sale of the 7.25% Series B Cumulative Redeemable Preferred Stock ($59.8 million), and net advances under the credit facility ($2.0 million). During the six months ended June 30, 2012, the Company had repayments of mortgage obligations ($31.9 million), preferred and common stock distributions ($14.4 million), redemptions and repurchase of the 8.875% Series A Cumulative Redeemable Preferred Stock ($9.4 million), the payment of debt financing costs ($4.3 million), and distributions to noncontrolling interests (minority interests and limited partners-$3.6 million), offset by net advances under the credit facility ($13.2 million), and proceeds from the sale of the 7.25% Series B Cumulative Redeemable Preferred Stock ($9.8 million).

Funds From Operations

Funds From Operations “FFO” is a widely-recognized non-GAAP financial measure for REITs that the Company believes, when considered with financial statements prepared in accordance with GAAP, is useful to investors in understanding financial performance and providing a relevant basis for comparison among REITs. In addition, FFO is useful to investors as it captures features particular to real estate performance by recognizing that real estate generally appreciates over time or maintains residual value to a much greater extent than do other depreciable assets. Investors should review FFO, along with GAAP net income, when trying to understand a REIT’s operating performance. The Company considers FFO an important supplemental measure of its operating performance and believes that it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs.

The Company computes FFO in accordance with the “White Paper” published by the National Association of Real Estate Investment Trusts (“NAREIT”), which defines FFO as net income applicable to common shareholders (determined in accordance with GAAP), excluding impairment charges, gains or losses from debt restructurings and sales of properties, plus real estate-related depreciation and amortization, and after adjustments for partnerships and joint ventures (which are computed to reflect FFO on the same basis). FFO does not represent cash generated from operating activities and should not be considered as an alternative to net income applicable to common shareholders or to cash flow from operating activities. FFO is not indicative of cash available to fund ongoing cash needs, including the ability to make cash distributions. Although FFO is a measure used for comparability in assessing the performance of REITs, as the NAREIT White Paper only provides guidelines for computing FFO, the computation of FFO may vary from one company to another. The following table sets forth the Company’s calculations of FFO for the three and six months ended June 30, 2013 and 2012:


	Three months ended June 30,						Six months ended June 30,
	2013			2012			2013			2012
Net loss attributable to common shareholders	$	977,000		$	1,236,000		$	65,000		$	(8,104,000	)
Add (deduct):
Real estate depreciation and amortization		9,657,000			9,712,000			19,386,000			25,392,000
Limited partners’ interest		4,000			8,000			1,000			(97,000	)
Impairment reversals, net		—			—			(1,100,000	)		(1,138,000	)
Gain on sales		—			(372,000	)		(346,000	)		(829,000	)
Consolidated minority interests:
Share of (loss) income		(97,000	)		662,000			(103,000	)		1,708,000
Share of FFO		(278,000	)		(1,377,000	)		(695,000	)		(2,791,000	)
Unconsolidated joint venture:
Share of income		—			(576,000	)		—			(1,021,000	)
Share of FFO		—			1,587,000			—			3,056,000

FFO	$	10,263,000		$	10,880,000		$	17,208,000		$	16,176,000

Inflation

Inflation has been relatively low in recent years and has not had a significant detrimental impact on the Company’s results of operations. Should inflation rates increase in the future, substantially all of the Company’s tenant leases contain provisions designed to partially mitigate the negative impact of inflation in the near term. Such lease provisions include clauses that require tenants to reimburse the Company for real estate taxes and many of the operating expenses it incurs. Significant inflation rate increases over a prolonged period of time may have a material adverse impact on the Company’s business.

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

One of the principal market risks facing the Company is interest rate risk on its credit facilities. The Company may, when advantageous, hedge its interest rate risk by using derivative financial instruments. The Company is not subject to foreign currency risk.

The Company is exposed to interest rate changes primarily through (1) the variable-rate credit facility used to maintain liquidity, fund capital expenditures and redevelopment activities, and expand its real estate investment portfolio, and (2) property-specific variable-rate mortgage financing. The Company’s objectives with respect to interest rate risk are to limit the impact of interest rate changes on operations and cash flows, and to lower its overall borrowing costs. To achieve these objectives, the Company may borrow at fixed rates and may enter into derivative financial instruments such as interest rate swaps, caps, etc., in order to mitigate its interest rate risk on a related variable-rate financial instrument. The Company does not enter into derivative or interest rate transactions for speculative purposes. At June 30, 2013, the Company had two mortgage loans payable aggregating approximately $25.7 million subject to interest rate swaps which converted LIBOR-based variable rates to fixed rates of 5.2% and 6.5% per annum. At that date, the Company had accrued liabilities of $0.8 million (included in accounts payable and accrued liabilities on the consolidated balance sheet) relating to the fair value of interest rate swaps applicable to these mortgage loans payable.

At June 30, 2013, long-term debt consisted of fixed-rate mortgage loans payable and variable-rate debt (including the Company’s variable-rate credit facility). The average interest rate on the $499.3 million of fixed-rate indebtedness outstanding was 5.5%, with maturities at various dates through 2029. The average interest rate on the $218.0 million of variable-rate debt (including $158.0 million in advances under the Company’s credit facility) was 2.9% (2.4% after the amendment to the credit facility). With respect to the $218.0 million of variable-rate debt outstanding at June 30, 2013, if interest rates either increase or decrease by 1%, the Company’s interest cost would increase or decrease respectively by approximately $2.2 million per annum.

Item 4.

Controls and Procedures

The Company maintains disclosure controls and procedures and internal controls designed to ensure that information required to be disclosed in its filings under the Securities Exchange Act of 1934 is reported within the time periods specified in the rules and regulations of the Securities and Exchange Commission (“SEC”). In this regard, the Company has formed a Disclosure Committee currently comprised of several of the Company’s executive officers as well as certain other employees with knowledge of information that may be considered in the SEC reporting process. The Committee has responsibility for the development and assessment of the financial and non-financial information to be included in the reports filed with the SEC, and assists the Company’s Chief Executive Officer and Chief Financial Officer in connection with their certifications contained in the Company’s SEC filings. The Committee meets regularly and reports to the Audit Committee on a quarterly or more frequent basis. The Company’s principal executive and financial officers have evaluated its disclosure controls and procedures as of June 30, 2013, and have determined that such disclosure controls and procedures are effective.

During the three months ended June 30, 2013, there have been no changes in the internal controls over financial reporting or in other factors that have materially affected, or are reasonably likely to materially affect, these internal controls over financial reporting.

Part II Other Information

Item 6.

Exhibits



Exhibit 10.1		Second Amended and Restated Loan Agreement (the “Loan Agreement”) by and among Cedar Realty Trust Partnership, L.P., KeyBank National Association and other lending institutions which are or may become parties to the Loan Agreement, and KeyBank National Association (as Administrative Agent), dated as of August 1, 2013.

Exhibit 31		Section 302 Certifications

Exhibit 32		Section 906 Certifications

Exhibit 101.INS		XBRL Instance Document

Exhibit 101.SCH		XBRL Taxonomy Extension Schema Document

Exhibit 101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

Exhibit 101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

Exhibit 101.LAB		XBRL Taxonomy Extension Label Linkbase Document

Exhibit 101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


CEDAR REALTY TRUST, INC.

By:	/s/ BRUCE J. SCHANZER	By:	/s/ PHILIP R. MAYS
Bruce J. Schanzer		Philip R. Mays
President and Chief		Chief Financial Officer
Executive Officer		(Principal financial officer)
(Principal executive officer)

August 6, 2013

EX-10.1 2 d578685dex101.htm EX-10.1 EX-10.1

Exhibit 10.1

SECOND AMENDED AND RESTATED LOAN AGREEMENT

Dated as of August 1, 2013

Among

CEDAR REALTY TRUST PARTNERSHIP, L.P.

as Borrower

THE LENDERS FROM TIME TO TIME PARTY HERETO

KEYBANK NATIONAL ASSOCIATION,

as Administrative Agent, L/C Issuer and Swing Line Lender

KEYBANC CAPITAL MARKETS,

and

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

as Co-Lead Arranger and Co-Lead Book Manager

BANK OF AMERICA, N.A.,

as Syndication Agent

MANUFACTURERS AND TRADERS TRUST COMPANY and REGIONS BANK,

as Co-Documentation Agents

TABLE OF CONTENTS


	Page
1. DEFINITIONS		1

1.1 Defined Terms		1
1.2 Other Interpretive Provisions		30
1.3 Accounting Terms		31
1.4 Rounding		32
1.5 Times of Day		32
1.6 Letter of Credit Amounts		32

2. LOAN PROVISIONS		32

2. 1 General Loan Provisions		32
2.1.1 Loans		32
2.1.2 Procedures and Limits		34
2.1.3 Funding Procedures		35
2.2 Term of Loan		36
2.2.1 Revolving Facility		36
2.2.2 Term Facility		37
2.2.3 Termination/Reduction of Revolving Commitments		37
2.3 Interest Rate and Payment Terms		38
2.3.1 Borrower’s Options		38
2.3.2 Selection To Be Made		38
2.3.3 Notice		38
2.3.4 If No Notice		38
2.3.5 Telephonic Notice		39
2.3.6 Limits On Options		39
2.3.7 Payment and Calculation of Interest		39
2.3.8 Mandatory Principal Payments		39
2.3.9 Prepayment		40
2.3.10 Maturity		40
2.3.11 Method of Payment; Date of Credit; Administrative Agent’s Clawback		40
2.3.12 Billings		42
2.3.13 Default Rate		42
2.3.14 Late Charges		42
2.3.15 Breakage Fee		43
2.3.16 Borrower Information		43
2.4 Loan Fees		43
2.4.1 Loan Fees		43
2.4.2 Unused Fee		44
2.4.3 Payment of Fees Generally		44
2.5 Swing Line Loans.		44
2.5.1 The Swing Line		44
2.5.2 Borrowing Procedures		45


2.5.3 Refinancing of Swing Line Loans			45
2.5.4 Repayment of Participations			46
2.5.5 Interest for Account of Swing Line Lender			47
2.5.6 Payments Directly to Swing Line Lender			47
2.5.7 Swing Line Note			47
2.6 Additional Provisions Related to Interest Rate Selection			47
2.6.1 Increased Costs			47
2.6.2 Capital Requirements			48
2.6.3 Illegality			48
2.6.4 Availability			48
2.6.5 Base Rate Advances			49
2.6.6 Delay in Requests			49
2.6.7 Mitigation			49
2.6.8 Survival			49
2.6.9 Taxes			50
2.7 Letters of Credit			50
2.7.1 The Letter of Credit Commitment			50
2.7.2 Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of Credit			52
2.7.3 Drawings and Reimbursements; Funding of Participations			54
2.7.4 Repayment of Participations			56
2.7.5 Obligations Absolute			56
2.7.6 Role of L/C Issuer			57
2.7.7 Cash Collateral			58
2.7.8 Applicability of ISP			58
2.7.9 Letter of Credit Fees			58
2.7.10 Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer			59
2.7.11 Conflict with Issuer Documents			59
2.7.12 Letters of Credit Issued for Borrower Subsidiaries			59
2.7.13 Amount			59
2.8 Taxes			60
2.8.1 Payments Free of Taxes; Obligation to Withhold; Payments on Account of Taxes			60
2.8.2 Payment of Other Taxes by the Borrower			60
2.8.3 Tax Indemnifications			60
2.8.4 Evidence of Payments			61
2.8.5 Status of Lenders; Tax Documentation			62
2.8.6 Treatment of Certain Refunds			64
2.9 Defaulting Lenders			64
2.9.1 Adjustments			64
2.9.2 Defaulting Lender Cure			66

3. BORROWING BASE PROPERTIES			66

3.1 Loan Documents			66
3.2 Removal of Individual Property as a Borrowing Base Property - Borrower			67
3.2.1 Borrowing Base Compliance			67


3.2.2 Financial Covenant Compliance			67
3.2.3 No Default Upon Release			67
3.2.4 No Default Prior to Release			67
3.2.5 [Reserved]			67
3.2.6 Payment of Fees			67
3.3 Removal of Individual Property as a Borrowing Base Property - Administrative Agent			68
3.3.1 Removal Criteria			68
3.3.2 [Reserved]			68
3.3.3 Release by Administrative Agent			68
3.4 Additional Borrowing Base Property			68

4. CONTINUING AUTHORITY OF AUTHORIZED OFFICERS			69

5. CONDITIONS PRECEDENT			69

5.1 Closing Loan and Funding Initial Loan Advance			69
5.1.1 Satisfactory Loan Documents			70
5.1.2 Financial Information; No Material Change			70
5.1.3 Representations and Warranties Accurate			70
5.1.4 Lien Searches			70
5.1.5 Litigation			71
5.1.6 Formation Documents and Entity Agreements			71
5.1.7 Compliance With Laws			71
5.1.8 Compliance With Financial Covenants			71
5.1.9 Borrowing Base Property Due Diligence			71
5.1.10 Condition of Property			72
5.1.11 Third Party Consents and Agreements			72
5.1.12 Legal and other Opinions			72
5.1.13 No Default			72
5.2 Conditions to all Credit Extensions			72
5.2.1 Financial Covenant Compliance			72
5.2.2 No Default			72
5.2.3 Loan Notice			72

6. REPRESENTATIONS AND WARRANTIES			73

6.1 Formation			73
6.2 Proceedings; Enforceability			73
6.3 Conflicts			73
6.4 Ownership and Taxpayer Identification Numbers			73
6.5 Litigation			74
6.6 Information			74
6.7 Taxes			74
6.8 Financial Information			74
6.9 Control Provisions			74
6.10 Formation Documents			75
6.11 Bankruptcy Filings			75
6.12 Investment Company			75

iii


6.13 [Reserved]			75
6.14 Borrowing Base Properties			75
6.14.1 Licenses and Permits			75
6.14.2 Ownership			75
6.14.3 Environmental Matters			76
6.14.4 Leases			76
6.14.5 Ground Lease			77
6.14.6 Casualty/Condemnation			77
6.14.7 Property Condition			77
6.15 Margin Regulations; Use of Proceeds			77
6.16 Insurance			77
6.17 Deferred Compensation and ERISA			77
6.18 [Reserved]			78
6.19 No Default			78
6.20 Governmental Authorizations; Other Consents			78
6.21 Qualification as a REIT			78
6.22 Compliance with Laws			78
6.23 Property Matters			78
6.23.1 Major Leases			78
6.23.2 Borrowing Base Properties			78
6.24 Solvency			79
6.25 Regarding Representations and Warranties			79

7. AFFIRMATIVE COVENANTS			79

7.1 Notices			80
7.2 Financial Statements; Reports; Officer’s Certificates			80
7.2.1 Annual Statements			80
7.2.2 Periodic Statements			80
7.2.3 Borrowing Base Property Reports			81
7.2.4 SEC Reports			81
7.2.5 Compliance Certificates			81
7.2.6 Data Requested			81
7.2.7 Tax Returns			82
7.2.8 [Reserved.]			82
7.2.9 [Reserved.]			82
7.2.10 Entity Notices			82
7.2.11 Property Acquisition or Sale			82
7.2.12 Property Finance			82
7.2.13 Notice of Litigation			82
7.3 Existence			83
7.4 Payment of Taxes			83
7.5 Insurance.			84
7.5.1 Insurance			84
7.5.2 Notice of Damage			84
7.6 Inspection			84
7.7 Loan Documents			84
7.8 Further Assurances			84


7.9 Books and Records			85
7.10 Business and Operations			85
7.11 Estoppel			85
7.12 ERISA			86
7.13 [Reserved]			86
7.14 Costs and Expenses			86
7.15 Indemnification			86
7.16 Interest Coverage Ratio			86
7.17 Leverage Ratio			86
7.18 Fixed Charge Ratio			87
7.19 Net Worth			87
7.20 Secured Debt Ratio			87
7.21 Borrowing Base Property Covenants			87
7.21.1 Occupancy Ratio			87
7.21.2 Retail Center			87
7.21.3 Business Strategy			87
7.21.4 Minimum Borrowing Base Properties			88
7.22 Variable Rate Debt			88
7.23 Replacement Documentation			88
7.24 Maintenance of REIT Status			88
7.25 The Lenders’ Consultants			88
7.25.1 Right to Employ			88
7.25.2 Functions			88
7.25.3 Payment			88
7.25.4 Access			88
7.25.5 No Liability			88
7.26 Payment of Obligations			89
7.27 Compliance with Laws			89

8. NEGATIVE COVENANTS			89

8.1 No Changes to the Borrower and other Loan Parties			89
8.2 Restrictions on Liens			89
8.2.1 Permitted Debt			89
8.2.2 Tax Liens			90
8.2.3 Judgment Liens			90
8.2.4 Personal Property Liens			90
8.2.5 L/C Issuer/Swing Line Lenders Liens			90
8.2.6 Easements, etc			90
8.2.7 Title Matters			90
8.3 Consolidations, Mergers, Sales of Assets, Issuance and Sale of Equity			91
8.3.1 Transfers			91
8.3.2 Non-Loan Parties			91
8.3.3 Loan Parties			91
8.3.4 Borrowing Base Properties			91
8.3.5 Leases			91
8.3.6 Property Transfers			91
8.3.7 Ordinary Course			91


8.3.8 With Consent			92
8.3.9 Permitted Investments			92
8.3.10 Equity Issuances			92
8.3.11 Merger of Loan Parties			92
8.3.12 Cedar-Riverview			92
8.3.13 Cedar-Revere			92
8.4 Restrictions on Debt			92
8.4.1 Debt under this Agreement			92
8.4.2 Unsecured Debt			92
8.4.3 Individual Property Debt			92
8.4.4 Nonrecourse Debt			93
8.4.5 Ordinary Course			93
8.4.6 Capital Leases			93
8.4.7 Cross-Collateralized Debt			93
8.4.8 Other Unsecured Debt			93
8.4.9 Other Debt			93
8.5 Other Business			93
8.6 Change of Control			93
8.7 Forgiveness of Debt			93
8.8 Affiliate Transactions			93
8.9 ERISA			94
8.10 Bankruptcy Filings			94
8.11 Investment Company			94
8.12 [Reserved]			94
8.13 Use of Proceeds			94
8.14 Distributions			94
8.15 Restrictions on Investments			94
8.16 Negative Pledges, Etc.			94
8.17 Swap Contracts			95

9. SPECIAL PROVISIONS			95

9.1 Legal Requirements			95
9.2 Limited Recourse Provisions.			95
9.2.1 Borrower Fully Liable			95
9.2.2 Certain Non-Recourse			95
9.2.3 Additional Matters			96
9.3 Payment of Obligations			96

10. EVENTS OF DEFAULT			96

10.1 Default and Events of Default			96
10.1.1 Failure to Pay the Loan			96
10.1.2 Failure to Make Other Payments			97
10.1.3 Loan Documents			97
10.1.4 Default under Other Agreements			97
10.1.5 Representations and Warranties			97
10.1.6 Affirmative Covenants			98
10.1.7 Negative Covenants			98


10.1.8 Financial Status and Insolvency			98
10.1.9 Loan Documents			98
10.1.10 Judgments			98
10.1.11 ERISA			99
10.1.12 Change of Control			99
10.1.13 Indictment; Forfeiture			99
10.1.14 Generally			99
10.2 Grace Periods and Notice			99
10.2.1 No Notice or Grace Period			99
10.2.2 Nonpayment of Interest			100
10.2.3 Other Monetary Defaults			100
10.2.4 Nonmonetary Defaults Capable of Cure			100
10.2.5 Borrowing Base Property Defaults			100

11. REMEDIES			100

11.1 Remedies			100
11.1.1 Accelerate Debt			100
11.1.2 Collateralize Letters of Credit			100
11.1.3 Pursue Remedies			100
11.2 Distribution of Liquidation Proceeds			101
11.3 Power of Attorney			102

12. SECURITY INTEREST AND SET-OFF			102

12.1 Security Interest			102
12.2 Set-Off/Sharing of Payments			102
12.3 Right to Freeze			103
12.4 Additional Rights			103

13. THE ADMINISTRATIVE AGENT AND THE LENDERS			103

13.1 Rights, Duties and Immunities of the Administrative Agent			103
13.1.1 Appointment of Administrative Agent			103
13.1.2 No Other Duties, Etc.			103
13.1.3 Delegation of Duties			103
13.1.4 Exculpatory Provisions			104
13.1.5 Reliance by Administrative Agent			105
13.1.6 Notice of Default			105
13.1.7 Lenders’ Credit Decisions			105
13.1.8 Administrative Agent’s Reimbursement and Indemnification			105
13.1.9 Administrative Agent in its Individual Capacity			106
13.1.10 Successor Administrative Agent			106
13.1.11 Administrative Agent May File Proofs of Claim			107
13.1.12 Guaranty Matters			108
13.2 Respecting Loans and Payments			108
13.2.1 Adjustments			108
13.2.2 Setoff			108
13.2.3 Distribution by the Administrative Agent			109
13.2.4 Removal or Replacement of a Lender			109

vii


13.2.5 Holders			110
13.3 Assignments by Lenders			110
13.3.1 Successors and Assigns Generally			110
13.3.2 Assignments by Lenders			110
13.3.3 Register			112
13.3.4 Participations			112
13.3.5 Limitations upon Participant Rights			113
13.3.6 Certain Pledges			113
13.3.7 Resignation as L/C Issuer and Swing Line Lender after Assignment			114
13.4 Administrative Matters			114
13.4.1 Amendment, Waiver, Consent, Etc.			114
13.4.2 Deemed Consent or Approval			116

14. RESERVED			116

15. GENERAL PROVISIONS			116

15.1 Notices			116
15.2 Interest Rate Limitation			119
15.3 [Reserved]			119
15.4 [Reserved]			119
15.5 Parties Bound			119
15.6 Governing Law; Consent to Jurisdiction; Mutual Waiver of Jury Trial			119
15.6.1 GOVERNING LAW			119
15.6.2 SUBMISSION TO JURISDICTION			120
15.6.3 WAIVER OF VENUE			120
15.6.4 SERVICE OF PROCESS			120
15.6.5 WAIVER OF JURY TRIAL			120
15.7 Survival			121
15.8 Cumulative Rights			121
15.9 Expenses; Indemnity; Damage Waiver			121
15.9.1 Costs and Expenses			121
15.9.2 Indemnification by the Borrower			122
15.9.3 Reimbursement by Lenders			122
15.9.4 Waiver of Consequential Damages, Etc.			123
15.9.5 Payments			123
15.9.6 Survival			123
15.10 Regarding Consents			123
15.11 Obligations Absolute			123
15.12 Table of Contents, Title and Headings			123
15.13 Counterparts			123
15.14 Satisfaction of Commitment Letter			124
15.15 Time Of the Essence			124
15.16 No Oral Change			124
15.17 Monthly Statements			124
15.18 No Advisory or Fiduciary Responsibility			124
15.19 USA PATRIOT Act			125
15.20 Treatment of Certain Information; Confidentiality			125
15.21 Amendment and Restatement			126

viii

SCHEDULES


Schedule 1.1(a)		Lenders’ Commitment

Schedule 1.1(b)		Existing Letters of Credit

Schedule 4		Authorized Officers

Schedule 6.4		Ownership Interests and Taxpayer Identification Numbers

Schedule 6.14.2		Borrowing Base Properties

Schedule 6.14.3		Environmental Reports

Schedule 6.14.5		Ground Leases

Schedule 6.23.1		Major Leases

Schedule 8.3.6		Designated Properties

Schedule 15.1		Notices

EXHIBITS


Exhibit A	—	Form of Loan Notice

Exhibit B	—	Form of Note

Exhibit C	—	Form of Compliance Certificate

Exhibit D	—	Form of Assignment and Assumption

Exhibit E	—	Form of Closing Compliance Certificate

Exhibit F-1	—	Form of CRT Guaranty Agreement

Exhibit F-2	—	Form of Subsidiary Guaranty Agreement

Exhibit G	—	Form of Swing Line Note

Exhibit H	—	Form of Cash Flow Projections

THIS SECOND AMENDED AND RESTATED LOAN AGREEMENT AMENDS AND

RESTATES IN ITS ENTIRETY THAT CERTAIN AMENDED, RESTATED AND

CONSOLIDATED LOAN AGREEMENT DATED AS OF JANUARY 26, 2012

AMONGST CEDAR REALTY TRUST PARTNERSHIP, L.P., THE LENDERS PARTY

THERETO, AND KEYBANK NATIONAL ASSOCIATION, AS AGENT (THE

“EXISTING AGREEMENT”).

SECOND AMENDED AND RESTATED LOAN AGREEMENT

This agreement (this “Loan Agreement” or “Agreement”) is made and entered into as of August 1, 2013, by and between CEDAR REALTY TRUST PARTNERSHIP, L.P., a Delaware limited partnership (the “Borrower”), KEYBANK NATIONAL ASSOCIATION (“KeyBank”) and the several banks and other financial institutions as are, or may from time to time become parties to this Agreement (each a “Lender” and collectively, the “Lenders”), KEYBANK NATIONAL ASSOCIATION, as administrative agent for the Lenders (the “Administrative Agent”), Swing Line Lender (as hereinafter defined) and L/C Issuer (as hereinafter defined), KEYBANC CAPITAL MARKETS and MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED as Co-Lead Arranger and Co-Lead Book Manager, BANK OF AMERICA, N.A., as Syndication Agent and MANUFACTURERS AND TRADERS TRUST COMPANY and REGIONS BANK, as Co-Documentation Agents.

WITNESSETH:

WHEREAS, the Borrower has entered into the Existing Facility, and has requested that the Lenders amend and restate the Existing Facility and provide to the Borrower the Revolving Facility and the Term Facility;

WHEREAS, the Lenders have so agreed to amend and restate the Existing Facility as provided herein and provide for both the Revolving Facility and the Term Facility on and subject to the terms and conditions set forth herein; and

WHEREAS, each and every lender party to the Existing Facility has become a Lender under this Agreement or has been paid in full all principal, interest, fees and other amounts owing to it under the Existing Facility.

NOW, THEREFORE, IN CONSIDERATION of the premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1. DEFINITIONS.

1.1 Defined Terms.

As used in this Loan Agreement, the following terms shall have the meanings specified below unless the context otherwise requires:

“Act” shall have the meaning set forth in Section 15.19.

“Additional Borrowing Base Request” shall have the meaning set forth in Section 3.4.

“Adjusted Capitalized Value” shall mean with respect to any Borrowing Base Property, the most recent fiscal quarter Adjusted Net Operating Income for such Borrowing Base Property, annualized, capitalized at the Capitalization Rate.

“Adjusted FFO” shall mean, for CRT and its Consolidated Subsidiaries, net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from (i) debt restructurings, (ii) sales of real property, and (iii) extraordinary and/or nonrecurring items, plus real estate related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures, as set forth in more detail under the definitions and interpretations thereof relative to funds from operations promulgated by the National Association of Real Estate Investment Trusts or its successor.

“Adjusted Net Operating Income” shall mean, for any period of determination, for any Individual Property, the Pro Rata Share of (i) Net Operating Income, less (ii) management fees (calculated as the greater of either three percent (3%) of total revenue or actual management expenses incurred), to the extent not already deducted from Net Operating Income, less (iii) allowances for capital expenditures in the amount of $0.20 per annum per rentable square foot of completed improvements.

“Administrative Agent” shall mean, KEYBANK NATIONAL ASSOCIATION, acting as agent for the Lenders, together with its successors and assigns.

“Administrative Agent’s Office” shall mean the Administrative Agent’s address and, as appropriate, account as set forth in Section 15.1, or such other address or account as the Administrative Agent may from time to time notify to the Borrower and the Lenders

“Administrative Questionnaire” shall mean an Administrative Questionnaire in a form supplied by the Administrative Agent.

“Affiliate” shall mean, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

“Agent Parties” shall have the meaning set forth in Section 15.1(c).

“Agreement” shall have the meaning set forth in the Preamble.

“Applicable Margin” shall mean, for any day, with respect to any LIBO Rate Advances or Base Rate Advances, as the case may be, the applicable rate per annum set forth below under the caption “LIBO Rate Advances” or “Base Rate Advances”:


Level	Leverage Ratio	LIBO Rate Advances Applicable Margin		Base Rate Advances Applicable Margin
1	³ 55% but < 60%		2.25%		1.25%
2	³ 50% but < 55%		1.95%		.95%
3	³ 45% but < 50%		1.75%		.75%
4	< 45%		1.65%		.65%

Each change in the applicable LIBO Rate Advances Applicable Margin or the Base Rate Advances Applicable Margin, as the case may be, shall apply during the period commencing on the date of the most recent Compliance Certificate delivered to the Administrative Agent and ending on the date of receipt of the next Compliance Certificate. If a Compliance Certificate is not delivered to the Administrative Agent in accordance with the terms hereof, the Applicable Margin shall be deemed to be based on Level 1 until the required Compliance Certificate is delivered to the Administrative Agent. The provisions of this definition shall be subject to Section 2.3.16.

“Approved Fund” shall mean any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Arranger” shall mean, collectively, KeyBanc Capital Markets and Merrill Lynch, Pierce, Fenner & Smith Incorporated.

“Assignee Group” shall mean two or more Eligible Assignees that are Affiliates of one another or two or more Approved Funds managed by the same investment advisor.

“Assignment and Assumption” shall mean an assignment and assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 13.3, and accepted by the Administrative Agent), in substantially the form of Exhibit D or any other form approved by the Administrative Agent.

“Authorized Officer” shall mean, with respect to any Loan Party, the Chief Executive Officer, the Chief Financial Officer, the Chief Operating Officer, the Vice President of Operations and their respective successors, it being understood that one individual may hold the office of Chief Operating Officer and Vice President of Operations.

“Auto-Extension Letter of Credit” shall have the meaning set forth in Section 2.7.2(c).

“Auto-Reinstatement Letter of Credit” shall have the meaning set forth in Section 2.7.2(d).

“BOFA” shall mean Bank of America, N.A., a national banking association.

“Base Rate” shall mean for any day a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus one half of 1% (0.50%), or (b) the Prime Rate in effect for such day. “Prime Rate” shall mean the rate of interest in effect for such day as publicly announced from time to time by KeyBank as its “prime rate.” The “prime rate” is a rate set by KeyBank based upon various factors including KeyBank’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in such rate announced by KeyBank shall take effect at the opening of business on the day specified in the public announcement of such change.

“Base Rate Advance” shall mean any principal amount outstanding under this Agreement which pursuant to this Agreement bears interest at the Base Rate Accrual Rate.

“Base Rate Accrual Rate” shall mean the greater of (a) the Base Rate plus the Applicable Margin or (b) the LIBO Rate (as specified in clause (b) of the definition thereof) plus the Applicable Margin for the corresponding LIBO Rate Advance had such advance been a LIBO Rate Advance.

“Book Value” shall mean the value of such property or asset, as determined in accordance with GAAP.

“Borrower” shall have the meaning set forth in the Preamble.

“Borrower Materials” shall have the meaning set forth in Section 7.2.13.

“Borrower Reduction Date” shall have the meaning set forth in Section 2.2.2(b).

“Borrower Subsidiaries” shall mean, individually and collectively, all of the Subsidiaries of the Borrower and/or CRT.

“Borrower Termination Date” shall have the meaning set forth in Section 2.2.2(a).

“Borrowing Base Property” and “Borrowing Base Properties” shall mean, the Individual Properties initially listed in Schedule 6.14.2(i) hereto, plus any Individual Property which subsequently becomes a Borrowing Base Property in accordance with Section 3.4 hereof, but excluding (i) any Borrowing Base Property which is determined by the Administrative Agent to no longer be a Borrowing Base Property in accordance with Section 3.3, hereof, or (ii) any Borrowing Base Property which is released in accordance with Section 3.2 hereof.

“Borrowing Base Property Owner” and “Borrowing Base Property Owners” shall mean, from time to time, the Wholly-Owned Subsidiary or Subsidiaries of the Borrower or CRT (or an Unconsolidated CRT Entity to the extent approved by the Administrative Agent) which is or are the owner or owners of the fee simple interest in, or the approved ground lessee of, a Borrowing Base Property or the Borrowing Base Properties.

“Borrowing Base Property Requirements” shall mean the requirements, with respect to any Individual Property, set forth below:

(a) The Individual Property satisfies all Eligibility Criteria or is otherwise approved by the Required Lenders.

(b) Each applicable Loan Party has executed and delivered to the Administrative Agent a Guaranty.

(c) The Individual Property is owned in fee simple or ground leased pursuant to a Ground Lease by a Wholly-Owned Subsidiary of the Borrower, except as otherwise approved by the Administrative Agent.

(d) The Administrative Agent shall have received and completed a satisfactory review of such due diligence as the Administrative Agent may reasonably require (with the Borrower delivering such diligence to the Administrative Agent for delivery to the Lenders) with respect to any Individual Property (with the Administrative Agent agreeing to use reasonable efforts to utilize any due diligence previously submitted by the Borrower and received by the Administrative Agent pursuant to the Existing Facility), including, without limitation:

(i) To the extent in Borrower’s files, a copy of the owner’s title insurance policy or other evidence of the status of title to the Individual Property reasonably satisfactory to the Administrative Agent and the Administrative Agent’s counsel; and

(ii) To the extent requested by the Administrative Agent, copies of all Major Leases; and

(iii) To the extent in the Borrower’s files, a current environmental Phase I Site Assessment performed by a firm reasonably acceptable to the Administrative Agent within six (6) months of submission to the Administrative Agent, which indicates the property is free from recognized hazardous materials or substances apparent from the inspection, or affected by such environmental matters as may be reasonably acceptable to the Administrative Agent.

“Borrowing Base Value” shall mean, as of the most recent Compliance Certificate or Borrowing Base Property report, as applicable, delivered to the Administrative Agent, the sum of for all Borrowing Base Properties, (a) the lesser of (i) sixty percent (60%) of the Adjusted Capitalized Value of all such Borrowing Base Properties, or (ii) the Implied Loan Amount for all such Borrowing Base Properties, less (b) the Excess Recourse Debt, less (c) all Unsecured Debt of CRT and its Subsidiaries (excluding the Total Outstandings); provided, however, for purposes of calculating Borrowing Base Value, (x) the Borrowing Base Value from any single Borrowing Base Property shall not exceed fifteen percent (15%) of the total Borrowing Base Value and any Borrowing Base Value from such Borrowing Base Asset in excess of fifteen percent (15%) shall be excluded from the calculation of total Borrowing Base Value, and (y) aggregate rents from any single tenant or affiliate group of tenants may not exceed twenty five percent (25%) of the total rents of CRT and its Subsidiaries, and any rents from such tenants or affiliated group in excess of twenty five percent (25%) shall be excluded from the calculation of total Borrowing Base Value.

“Breakage Fee” shall have the meaning set forth in Section 2.3.15.

“Business Day” shall mean any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, New York, New York or the state where the Administrative Agent’s Office is located and, if such day relates to any LIBO Rate Advance, shall mean any such day on which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market. Further, payments shall be due on the first Business Day of each calendar month

“Calculation Date” shall mean the last day of each calendar quarter commencing with June 30, 2013.

“Calculation Period” shall mean for each Calculation Date, the just completed calendar quarter (inclusive of the applicable Calculation Date).

“Capital Stock” shall mean (i) with respect to any Person that is a corporation, any and all shares, interests, participations or other equivalents (however designated and whether or not voting) of corporate stock, including without limitation, each class or series of common stock and preferred stock of such Person and (ii) with respect to any Person that is not a corporation, any and all investment units, partnership, membership or other equity interests of such Person.

“Capitalization Rate” shall be equal to seven and one-half percent (7.5%).

“Carveout Designated Properties” shall mean those certain properties known as Gahanna Discount Drug Mart Plaza, McCormick Place and Roosevelt II.

“Cash Collateral” shall have the meaning set forth in in the definition of Cash Collateralize.

“Cash Collateralize” shall mean to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the Swing Line Lender, or the L/C Issuer, as applicable, and the Lenders, as collateral for L/C Obligations or Swing Line Loans or obligations of Lenders to fund participations in respect thereof (as the context may require), cash or deposit account balances (the “Cash Collateral”) pursuant to documentation in form and substance satisfactory to the Administrative Agent and the Swing Line Lender or the L/C Issuer, as applicable (which documents are hereby consented to by the Lenders). Derivatives of such term have corresponding meanings.

“Cash Flow Projections” shall mean a detailed schedule of all cash Distributions projected to be made to the Borrower from the Borrower Subsidiaries, as detailed on the model delivered to the Administrative Agent prior to the Closing Date (attached hereto as Exhibit H), and subject to change as shall be detailed in the respective Officer’s Certificate to be provided to the Administrative Agent as set forth herein, as may be requested by Administrative Agent from time to time.

“Change in Law” shall mean the occurrence, after the Closing Date, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority. Notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines and directives thereunder or issued in connection therewith and (ii) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

“Change of Control” shall mean the occurrence of any of the following:

(a) The acquisition by any Person, or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended) of Persons acting in concert, of beneficial ownership (within the meaning of Rule 13d-3 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended), directly or indirectly, of 50% or more of the outstanding shares of voting stock of CRT, other than short term acquisitions necessary in connection with the ultimate sale or other offerings of equity interests otherwise permitted hereunder;

(b) During any period of twelve (12) consecutive calendar months, individuals:

(1) Who were directors of CRT on the first day of such period; or

(2) Whose election or nomination for election to the board of directors of CRT was recommended or approved by at least a majority of the directors then still in office who were directors of CRT on the first day of such period, or whose election or nomination for election was so approved,

shall cease to constitute a majority of the board of directors of CRT; or

(d) CRT shall cease to own a minimum of 50% of the beneficial ownership interest in the Borrower, or

(e) With respect to any Borrowing Base Property Owner, the transfer of any ownership interest therein such that such Borrowing Base Property Owner is not a Wholly-Owned Subsidiary of the Borrower or CRT.

“Closing Compliance Certificate” shall have the meaning set forth in Section 5.1.2(b).

“Closing Date” shall have the meaning set forth in Section 5.1.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to the Code are to the Code, as in effect at the date of this Agreement and any subsequent provisions of the Code, amendatory thereof, supplemental thereto or substituted therefor.

“Combined EBITDA” shall mean the sum of the Pro Rata Share of EBITDA for each Consolidated CRT Entity and each Unconsolidated CRT Entity.

“Commitment” shall mean, with respect to each Lender, the aggregate amount of such Lender’s Revolving Commitment and Term Commitment.

“Commitment Letter” shall mean that certain Confidential Summary of Terms and Conditions, dated as of July 2, 2013, by and among the Borrower and KeyBank.

“Commitment Percentage” shall mean with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of the Total Commitments represented by such Lender’s Commitment at such time. If the commitment of each Lender to make Loan Advances, the commitment of the Swing Line Lender to make Swing Line Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 11.2 or if the Total Commitments have expired, then the Commitment Percentage of each Lender shall be determined based on the Commitment Percentage of such Lender most recently in effect, giving effect to any subsequent assignments. The initial Commitment Percentage of each Lender is set forth opposite the name of such Lender on Schedule 1.1(a) or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.

“Compliance Certificate” shall mean a compliance certificate in the form of Exhibit C.

“Consolidated” or “Consolidating” shall mean consolidated or consolidating as defined in accordance with GAAP.

“Consolidated CRT Entity” or “Consolidated CRT Entities” shall mean, singly and collectively, the Borrower, CRT, and any Subsidiary of the Borrower or CRT that is Consolidated.

“Control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

“Credit Extension” shall mean each of the following: (a) a Loan Advance and (b) an L/C Credit Extension.

“CRT” shall mean Cedar Realty Trust, Inc., a Maryland corporation.

“Debt” shall mean, with respect to any Person, without duplication, (i) all indebtedness of such Person for borrowed money, (ii) all indebtedness of such Person for the deferred purchase price of property or services (other than property and services purchased, and expense accruals and deferred compensation items arising, in the ordinary course of business), (iii) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments (other than performance, surety and appeal bonds arising in the ordinary course of business), (iv) all indebtedness of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), (v) all obligations of such Person under leases which have been, or should be, in accordance with generally accepted accounting principles, recorded as capital leases, to the extent required to be so recorded, (vi) all reimbursement, payment or similar obligations of such Person, contingent or otherwise, under acceptance, letter of credit or similar facilities (other than letters of credit in support of trade obligations or in connection with workers’ compensation, unemployment insurance, old-age pensions and other social security benefits in the ordinary course of business), (vii) any Guarantee of any indebtedness or other obligation of any Person, either directly or indirectly, of indebtedness described in clauses (i) through (vi), and (viii) all Debt referred to in clauses (i) through (vii) above secured by (or for which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) any Lien, security interest or other charge or encumbrance upon or in property (including, without limitation, accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such Debt. For the purposes of the calculation of the Financial Covenants, Debt of any entity in which a Person owns an ownership interest shall be calculated on its Pro Rata Share of such Debt, unless such Person has delivered a guaranty or other indemnity in connection with such Debt creating a greater proportionate liability, in which event, such greater liability shall apply.

“Debtor Relief Laws” shall mean the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

“Default” shall have the meaning set forth in Section 10.1.

“Default Rate” shall mean (a) when used with respect to Borrower Obligations other than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the Applicable Margin, if any, applicable to Base Rate Advances plus (iii) four percent (4.0%) per annum; provided, however, that with respect to a LIBO Rate Advance, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Margin) otherwise applicable to such Loan plus four percent (4.0%) per annum and (b) when used with respect to Letter of Credit Fees, a rate equal to the Applicable Margin plus four percent (4.0%) per annum.

“Defaulting Lender” shall mean Lender that (a) has failed to (i) fund all or any portion of its Loans or participation in L/C Obligations or Swing Line Loans within two (2) Business Days of the date such Loans or participations were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in L/C Obligations or Swing Line Loans) within two (2) Business Days of the date when due, (b) has notified the Borrower or the Administrative Agent in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three (3) Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a governmental authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such governmental authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender upon delivery of written notice of such determination to the Borrower and each Lender.

“Designated Property(ies)” shall mean the Individual Properties listed on Schedule 8.3.6.

“Development Assets” shall mean Individual Properties as to which construction of the associated or contemplated improvements has commenced (either new construction or substantial renovation) but has not yet been completed such that a certificate of occupancy (or the local equivalent) for a substantial portion of the intended improvements has not yet been issued or, for any completed project, until one hundred eighty (180) days after completion.

“Distribution” shall mean, with respect to any Person, that such Person has paid a dividend or returned any equity capital to its stockholders, members or partners or made any other distribution, payment or delivery of property (other than common stock or partnership or membership interests of such Person) or cash to its stockholders, members or partners as such, or redeemed, retired, purchased or otherwise acquired, directly or indirectly, for a consideration any shares of any class of its capital stock or any membership or partnership interests (or any options or warrants issued by such Person with respect to its capital stock or membership or partnership interests), or shall have permitted any of its Subsidiaries to purchase or otherwise acquire for a consideration any shares of any class of the capital stock or any membership or partnership interests of such Person (or any options or warrants issued by such Person with respect to its capital stock or membership or partnership interests). Without limiting the foregoing, “Distributions” with respect to any Person shall also include all payments made by such Person with respect to any stock appreciation rights, plans, equity incentive or achievement plans or any similar plans.

“Dollars” shall mean lawful money of the United States.

“Drawdown Date” shall have the meaning set forth in Section 2.1.2(a).

“EBITDA” shall mean for any Person the sum of (i) net income (or loss), plus (ii) actual interest paid or payable respecting all Debt to the extent included as an expense in the calculation of net income (or loss), plus (iii) total Tax Expenses to the extent included as an expense in the calculation of net income (or loss), plus (iv) total depreciation and amortization expense, to the extent included as an expense in the calculation of net income (or loss), plus (v) losses from extraordinary items, nonrecurring items, asset sales, write-ups or forgiveness of debt, to the extent included as an expense in the calculation of net income, minus (vi) gains from extraordinary items, nonrecurring items, asset sales, write-ups or forgiveness of debt, to the extent included as income in the calculation of net income, minus (vii) allowances for capital expenditures in the amount of $0.20 per annum per rentable square foot of improvements, adjusted (viii) for the elimination of straight line rents, all of the foregoing as determined in accordance with GAAP, as appropriate, minus (ix) to the extent not deducted in calculating net income (or loss), Ground Lease Payments (except to the extent of any portion of such payment which is treated as a payment under a capital lease in accordance with GAAP). Without limiting the generality of the foregoing, in determining EBITDA, net income shall include as income, Rent Loss Proceeds.

“Eligibility Criteria” shall mean the following criteria which must be satisfied in a manner acceptable to the Administrative Agent for each Borrowing Base Property:

(a) The Borrowing Base Property is a completed retail center located within the contiguous United States within one of CRT’s then current core markets, and being owned by a Borrowing Base Property Owner and managed by the Borrower;

(b) The Borrowing Base Property is of a scope and of an asset quality consistent with CRT’s other grocery-anchored properties or such other retail center-related assets as is approved by the Administrative Agent;

(d) The Borrower provides a certification as to the absence of any material environmental issues;

(e) The Borrower provides certification as to the absence of any material structural issues; and

(f) No security interests, liens or other encumbrances shall exist on the Borrowing Base Property upon its inclusion as a Borrowing Base Property, other than Permitted Liens.

“Eligible Assignee” shall mean any Person that meets the requirements to be an assignee under Section 13.3.2 (including the requirements or limitations set forth in Sections 13.3.2(c), (e) and (f)), subject to such consents, if any, as may be required under Section 13.3.2(c).

“Environmental Report” shall mean, each of the environmental reports listed on Schedule 6.14.3 hereto, plus any environmental report delivered to Administrative Agent in connection with the addition of a Borrowing Base Property in accordance with Section 3.4 hereof.

“Environmental Legal Requirements” shall mean any and all applicable Federal, state and local statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including those related to hazardous substances or wastes, air emissions and discharges to waste or public systems, as the same now exists or may be changed or amended or come into effect in the future, which pertains to any Hazardous Material or the environment including ground or air or water or noise pollution or contamination, and underground or aboveground tanks.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to ERISA are to ERISA, as in effect at the date of this Agreement and any subsequent provisions of ERISA, amendatory thereof, supplemental thereto or substituted therefor.

“ERISA Affiliate” shall mean each person (as defined in Section 3(9) of ERISA) which together with either Borrower or a Loan Party would be deemed to be a “single employer” (i) within the meaning of Section 414(b), (c), (m) or (o) of the Code or (ii) as a result of either Borrower or a Loan Party being or having been a general partner of such Person.

“Event of Default” shall have the meaning set forth in Section 10.1.

“Event of Loss” shall mean, with respect to any Borrowing Base Property, any of the following: (a) any loss or destruction of, or damage to, such Borrowing Base Property; or (b) any actual condemnation, seizure or taking, by exercise of the power of eminent domain or otherwise, of such Borrowing Base Property, or confiscation of such Borrowing Base Property or the requisition of such Borrowing Base Property by a Governmental Agency or any Person having the power of eminent domain, or any voluntary transfer of such Borrowing Base Property or any portion thereof in lieu of any such condemnation, seizure or taking.

“Excess Recourse Debt” shall mean, to the extent that the amount of recourse Debt permitted under Section 8.4.3 is in excess of ten percent (10%) of Total Asset Value, the amount of such aggregate recourse Debt which is in excess of sixty five percent (65%) of the Adjusted Capitalized Value of the underyling Individual Properties which secure such recourse Debt.

“Excluded Taxes” shall mean, with respect to the Administrative Agent, any Lender, the L/C Issuer or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) taxes imposed on or measured by its overall gross or net income (however denominated), and franchise taxes or similar taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the Laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable Lending Office is located or with which it has a present of former connection (other than any such connection resulting from its having executed, delivered or performed its obligations or received a payment under, or enforced, this Agreement or any other Loan Document), (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which the Borrower is located, (c) any backup withholding tax that is required by the Code to be withheld from amounts payable to a Lender that has failed to comply with Sections 2.8.5(b)(i), (d) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 13.2.4), any United States withholding tax that (i) is required to be imposed on amounts payable to such Foreign Lender pursuant to the Laws in force at the time such Foreign Lender becomes a party hereto (or designates a new Lending Office) or (ii) is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law) to comply with clause (ii) of Section2.8.5(b), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new Lending Office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Sections 2.8.5(b) or (c), (e) any tax attributable to a failure or inability to comply with Section 2.8.5(c), and (f) any U.S. federal withholding taxes imposed under FATCA.

“Existing Agreement” shall have the meaning set forth in the introduction to this Agreement.

“Existing Borrowing Base Properties” shall mean the Individual Properties that are qualified as Borrowing Base Properties under the Existing Facility as of the Closing Date.

“Existing Facility” shall mean the revolving credit facility provided to the Borrower by various lenders and KeyBank National Association, as administrative agent, pursuant to that certain Amended, Restated and Consolidated Loan Agreement dated as of January 26, 2012, and various documents and instruments executed in connection therewith.

“Existing Letter of Credit” shall mean those certain letters of credit listed on Schedule 1.1(b) issued by KeyBank under the Existing Facility, each of which shall be deemed to have been issued under the terms of this Agreement.

“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof.

“Federal Funds Rate” shall mean, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions in effect on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to KeyBank on such day on such transactions as determined by the Administrative Agent.

“Fee Letter” shall mean that certain fee letter, dated as of August 1, 2013, by and among the Borrower and KeyBank.

“Financial Covenants” shall mean those covenants of the Borrower set forth in Sections 7.16, 7.17, 7.18, 7.19, 7.20 and 7.22.

“Fiscal Year” shall mean each twelve month period commencing on January 1 and ending on December 31.

“Fixed Charges” shall mean, without duplication, the aggregate of the Pro Rata Share of all (a) Interest Expenses (excluding any interest expenses required to be capitalized under GAAP), (b) regularly scheduled principal amortization payments (other than any final “balloon” payments due at maturity) on all Debt of the Consolidated CRT Entities and the Unconsolidated CRT Entities, (c) preferred dividend payments or required Distributions (other than Distributions by the Borrower to holders of operating partnership units and Distributions by CRT to common equity holders) paid or payable by the Consolidated CRT Entities and the Unconsolidated CRT Entities, (d) any portion of a payment under a lease which is treated as a payment under a capital lease in accordance with GAAP), and (e) Tax Expenses for the Consolidated CRT Entities and the Unconsolidated CRT Entities, all of the foregoing as determined in accordance with GAAP.

“Fixed Charge Ratio” shall mean, for each Calculation Period, the ratio of (a) Combined EBITDA to (b) Fixed Charges.

“Foreign Lender” shall mean any Lender that is not a United States person within the meaning of Section 7701(a)(30) of the Code.

“Formation Documents” shall mean, singly and collectively, the partnership agreements, joint venture agreements, limited partnership agreements, limited liability company or operating agreements and certificates of limited partnership and certificates of formation, articles (or certificate) of incorporation and by-laws and any similar agreement, document or instrument of any Person, as amended subject to the terms and provisions hereof.

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with respect to L/C Issuer, such Defaulting Lender’s Commitment Percentage of the outstanding L/C Obligations other than L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders, Cash Collateralized in accordance with the terms hereof, or cancelled in accordance with the terms hereof, and (b) with respect to the Swing Line Lender, such Defaulting Lender’s Commitment Percentage of Swing Line Loans other than Swing Line Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof.

“Fund” shall mean any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.

“Funding Evidence” shall mean, in connection with the Borrower raising the funds necessary to make any Mandatory Principal Payment to be made pursuant to Section 2.3.8, evidence in connection with (i) the sale of any asset, that the Borrower has entered into a sales agreement, letter of intent, or listed the asset for sale with a recognized broker or (ii) the financing or refinancing of an asset, that the Borrower has obtained a commitment for such financing or submitted a loan application to a recognized financial institution, the proceeds of which together with such other funds as are available to the Borrower will be sufficient to make the required payment.

“GAAP” shall mean generally accepted accounting principles in the United States of America.

“Governmental Authority” shall mean the government of the United States or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“Ground Leases” shall mean, from time to time, any ground lease relative to an Individual Property and with respect to “Ground Leases” covering Borrowing Base Properties, for which the Administrative Agent has given its prior written approval.

“Ground Lease Payments” shall mean the sum of the Pro Rata Share of (i) payments made by the Consolidated CRT Entities under Ground Leases and (ii) payments made under Ground Leases by Unconsolidated CRT Entities. Ground Lease Payments shall not include the payments made by Cedar-South Philadelphia I, LLC under that certain ground lease dated as of October 31, 2003 by and between SPSP Corporation, Passyunk Supermarket, Inc., and Twenty Fourth Street Passyunk Partners, L.P., as landlord, and Cedar-South Philadelphia I, LLC, as tenant.

“Guarantee” shall mean, as to any Person, any (a) any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Debt or other obligation payable or performable by another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Debt or other obligation of the payment or performance of such Debt or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Debt or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Debt or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Debt or other obligation of any other Person, whether or not such Debt or other obligation is assumed by such Person (or any right, contingent or otherwise, of any holder of such Debt to obtain any such Lien). The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a corresponding meaning.

“Guaranty” shall have the meaning set forth in Section 3.1, as such agreements may be amended, restated, supplemented or otherwise updated or modified from time to time.

“Guarantor” or “Guarantors” shall mean CRT and those certain single-purpose Subsidiaries of the Borrower that have entered into a Guaranty, including without limitation, each Borrowing Base Property Owner and each Wholly-Owned Subsidiary of the Borrower or CRT which owns a direct or indirect ownership interest in a Borrowing Base Property Owner.

“Hazardous Materials” shall mean and include asbestos, mold, flammable materials, explosives, radioactive substances, polychlorinated biphenyls, radioactive substances, other carcinogens, oil and other petroleum products, pollutants or contaminants that could be a detriment to the environment, and any other hazardous or toxic materials, wastes, or substances which are defined, determined or identified as such in any past, present or future federal, state or local laws, rules, codes or regulations, or any judicial or administrative interpretation of such laws, rules, codes or regulations.

“Honor Date” shall have the meaning set forth in Section 2.7.3(a).

“Implied Debt Service” shall mean the greater of (a) the annual amount of principal and interest payable on a hypothetical loan in an amount equal to the Implied Loan Amount, based upon a thirty (30) year direct reduction monthly amortization schedule and a per annum interest rate equal to the actual blended interest rate for the Loan, or (b) an annual debt service constant of seven and ninety eight-one hundredths percent (7.98%) on such hypothetical loan amount.

“Implied Debt Service Coverage Ratio” shall mean as of each Calculation Date, the ratio of (i) the aggregate of (a) Adjusted Net Operating Income for all Borrowing Base Properties for the most recent fiscal quarter, annualized, to (ii) Implied Debt Service; such calculation and results to be as verified by the Administrative Agent.

“Implied Loan Amount” shall mean a principal amount which would generate as of any Calculation Date an Implied Debt Service Coverage Ratio of 1.50 to 1.00, which Implied Loan Amount may be revised by the Administrative Agent after the Closing Date or as of the most recent Compliance Certificate or Borrowing Base Property report, as applicable, delivered to the Administrative Agent, to reflect additions, removals and other adjustments to the Borrowing Base Properties since the Closing Date or the most recent Compliance Certificate or Borrowing Base Property report, as applicable, delivered to the Administrative Agent.

“Increase Effective Date” shall have the meaning set forth in Section 2.1.1(c).

“Indemnified Taxes” shall mean Taxes other than Excluded Taxes.

“Indemnitee” shall have the meaning set forth in Section 15.9.2.

“Individual Property” and “Individual Properties” shall mean, from time to time, all real estate property owned or ground leased by any Consolidated CRT Entity or any Unconsolidated CRT Entity, together with all improvements, fixtures, equipment, and personalty relating to such property.

“Information” shall have the meaning set forth in Section 15.20.

“Interest Coverage Ratio” shall mean the ratio of (a) a CRT’s Combined EBITDA for the immediately preceding calendar quarter to (b) all Pro Rata Interest Expense paid or payable respecting all Debt by the Consolidated CRT Entities and the Unconsolidated CRT Entities for such period (excluding in each instance any interest expenses required to be capitalized under GAAP).

“Interest Expense” shall mean the sum of the Pro Rata Share of the aggregate actual interest expense (whether expensed or capitalized) paid or payable respecting all Debt by the Consolidated CRT Entities and the Unconsolidated CRT Entities.

“Interest Period” shall mean, as to each LIBO Rate Advance, the period commencing on the date such LIBO Rate Advance is disbursed or converted to or continued as a LIBO Rate Advance and ending either one week or on the numerically corresponding day in the first, second, third or sixth month thereafter, as selected by the Borrower in its Loan Notice; provided that:

(i) any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day;

(ii) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and

(iii) no Interest Period shall extend beyond the Maturity Date.

“Investment” shall mean the acquisition of any real property or tangible personal property or of any stock or other security, any loan, advance, bank deposit, money market fund, contribution to capital, extension of credit (except for accounts receivable arising in the ordinary course of business and payable in accordance with customary terms), or purchase or commitment or option to purchase or otherwise acquire real estate or tangible personal property or stock or other securities of any party or any part of the business or assets comprising such business, or any part thereof.

“ISP” shall mean, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice (or such later version thereof as may be in effect at the time of issuance).

“Issuer Documents” shall mean with respect to any Letter of Credit, the Letter of Credit Application, and any other document, agreement and instrument entered into by the L/C Issuer and the Borrower (or any Borrower Subsidiary) or in favor the L/C Issuer and relating to any such Letter of Credit.

“Joinder Agreement” shall have the meaning set forth in Section 2.1.1(d).

“KeyBank” shall mean KEYBANK NATIONAL ASSOCIATION and its successors and assigns.

“Knowledge” or “knowledge” shall mean, with respect to any Loan Party, the actual knowledge of any Authorized Officer of such Loan Party. Notwithstanding the foregoing, such named parties and their successors are not parties to this Agreement and shall have no liability for a breach of any representation, warranty, covenant or agreement deemed to be made to their actual knowledge.

“Land Assets” shall mean Individual Properties constituting raw or undeveloped land as to which construction of contemplated improvements has not commenced or which does not generate rental revenues under a Ground Lease.

“Late Charge” shall have the meaning set forth in Section 2.3.14.

“Laws” shall mean, collectively, all Federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case having the force of law.

“L/C Advance” shall mean, with respect to each Lender, such Lender’s funding of its participation in any L/C Borrowing in accordance with its Commitment Percentage.

“L/C Borrowing” shall mean an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed on the date when made or refinanced as a Loan Advance.

“L/C Credit Extension” shall mean, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.

“L/C Draw” shall mean a payment made by the Administrative Agent pursuant to a Letter of Credit which was presented to the Administrative Agent for a draw of proceeds thereunder.

“L/C Exposure” shall mean, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time, plus (b) the aggregate amount of all L/C Draws that have not yet been reimbursed by or on behalf of the Borrower, or repaid through a Loan Advance, at such time.

“L/C Issuer” shall mean KeyBank in its capacity as issuer of Letters of Credit hereunder, or any successor issuer of Letters of Credit hereunder, with each of KeyBank and BOFA having the same rights and privileges as the L/C Issuer with respect to the respective Existing Letters of Credit. It is understood and agreed that BOFA shall have no obligation to renew any Existing Letter of Credit or to issue any new Letter of Credit.

“L/C Obligations” shall mean, as of any date of determination, the aggregate amount available to be drawn under all outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts, including all L/C Borrowings. For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 2.7.13. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

“Lease” shall mean any lease relative to all or any portion of a Borrowing Base Property.

“Lenders” shall have the meaning set forth in the Preamble and, as the context requires, the Swing Line Lender.

“Lenders’ Consultant” shall have the meaning set forth in Section 27.1.

“Lending Office” shall mean, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent.

“Letter of Credit” shall mean any standby letter of credit issued hereunder and shall include the Existing Letters of Credit.

“Letter of Credit Application” shall mean an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by the L/C Issuer.

“Letter of Credit Expiration Date” shall mean the day that is seven days prior to the Revolving Facility Maturity Date then in effect (or, if such day is not a Business Day, the next preceding Business Day).

“Letter of Credit Fee” shall have the meaning set forth in Section 2.7.9.

“Letter of Credit Sublimit” shall mean an amount equal to $20,000,000. The Letter of Credit Sublimit is part of, and not in addition to, the Total Revolving Commitments.

“Leverage Ratio” shall mean the quotient (expressed as a percentage) resulting from dividing (i) the aggregate of all Debt of the Consolidated CRT Entities and the Unconsolidated CRT Entities by (ii) the Total Asset Value.

“LIBO Rate” shall mean:

(a) For any Interest Period with respect to a LIBO Rate Advance, the rate per annum equal to (A) the LIBOR Rate as published by Reuters (or other commercially available source providing quotations of LIBOR as designated by the Administrative Agent from time to time) (“LIBOR”), at approximately 11:00 a.m., London time, two (2) Business Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period or (B) if such published rate is not available at such time for any reason, the rate determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the LIBO Rate Advance being made, continued or converted by KeyBank and with a term equivalent to such Interest Period would be offered to major banks, including KeyBank, in the London interbank Eurodollar market at their request at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period.

(b) For any interest rate calculation with respect to a Base Rate Advance, the rate per annum equal to (i) LIBOR, at approximately 11:00 a.m., London time on the date of determination (provided that if such day is not a London Business Day, the next preceding London Business Day) for Dollar deposits being delivered in the London interbank market for a term of one month commencing that day or (ii) if such published rate is not available at such time for any reason, the rate determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the date of determination in same day funds in the approximate amount of the subject Base Rate Advance being made, continued or converted by KeyBank and with a term equal to one month would be offered to major banks, including KeyBank, in the London interbank Eurodollar market at their request at the date and time of determination.

“LIBO Rate Advance” shall mean any principal outstanding under this Agreement which pursuant to this Agreement bears interest at the LIBO Rate plus the Applicable Margin.

“Lien” shall mean any mortgage, deed of trust, lien, pledge, hypothecation, assignment, security interest, or any other encumbrance, charge or transfer, including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and mechanic’s, materialmen’s and other similar liens and encumbrances.

“Licenses and Permits” shall mean all licenses, permits, authorizations and agreements issued by or agreed to by any governmental authority or by a private party, and including, but not limited to, building permits, occupancy permits and such special permits, variances and other relief as may be required pursuant to Laws which may be applicable to any Borrowing Base Property.

“Line Fee” shall have the meaning set forth in Section 2.4.2.

“Line Percentage” shall mean (i) 0.20% per annum, to the extent the Total Revolving Outstandings are greater than or equal to fifty percent (50%) of the Total Revolving Commitments and (ii) 0.30% per annum, to the extent the Total Revolving Outstandings are less than fifty percent (50%) of the Total Revolving Commitments.

“Liquidation Proceeds” shall mean amounts received by the Administrative Agent and/or the Lenders in the exercise of the rights and remedies under the Loan Documents.

“Loan” shall mean, individually or collectively, as the context so requires, for either the Revolving Facility or the Term Facility, any extension of credit by a Lender to the Borrower under Article 2 in the form of a Base Rate Advance or a LIBO Rate Advance as well as any Swing Line Loan.

“Loan Advance” or “Loan Advances” shall mean any advance of any proceeds of the Revolving Facility or the Term Facility, including any Swing Line Borrowings, as the case may be.

“Loan Agreement” shall have the meaning set forth in the Preamble.

“Loan Documents” shall have the meaning set forth in Section 3.1.

“Loan Notice” shall have the meaning set forth in Section 2.1.2(b).

“Loan Party” and “Loan Parties” shall mean, singly and collectively, the Borrower, the Guarantors and each Borrowing Base Property Owner.

“Major Event of Loss” shall mean, with respect to any Borrowing Base Property, any of the following: (a) any loss or destruction of, or damage to, such Borrowing Base Property such that either (x) the repairs and restoration thereof cannot be completed, in the judgment of the Lenders’ Consultant and if there is no Lenders’ Consultant, an independent architect or engineer retained by the Borrower, within six (6) months after the occurrence of such loss, damage or destruction or (y) rendering more than fifty percent (50%) of the Borrowing Base Property unusable for the purposes conducted thereon immediately prior to such loss, destruction or damage, as determined by the applicable Lenders’ Consultant and if there is no Lenders’ Consultant, an independent architect or engineer retained by the Borrower; or (b) any actual condemnation, seizure or taking, by exercise of the power of eminent domain or otherwise, of such Borrowing Base Property, or confiscation of such Borrowing Base Property or the requisition of such Borrowing Base Property by a Governmental Agency or any Person having the power of eminent domain, or any voluntary transfer of such Borrowing Base Property or any portion thereof in lieu of any such condemnation, seizure or taking, rendering more than fifty percent (50%) of the leaseable area of such Borrowing Base Property unusable for the purposes conducted thereon immediately prior to action, as determined by the Lenders’ Consultant and if there is no Lenders’ Consultant, an independent architect or engineer retained by the Borrower.

“Major Lease” shall mean (i) any Lease for space in any Borrowing Base Property (x) in excess of 25,000 rentable square feet, or (y) in excess of 15,000 rentable square feet and in excess of ten percent (10%) of the rentable square footage of such Borrowing Base Property, or (ii) any Lease with a tenant who is a tenant in more than one Borrowing Base Property and who leases 25,000 or more rentable square feet, in the aggregate, in all Borrowing Base Properties.

“Mandatory Principal Payment” shall have the meaning set forth in Section 2.3.8.

“Material Adverse Effect” shall mean a material adverse effect on (i) the business, assets, operations or financial or other condition of any of the Borrower, CRT, or, taken as a whole, the Loan Parties, (ii) the ability of any of the Borrower, CRT, or, taken as a whole, the Loan Parties to perform any material Obligations or to pay any Obligations which it is or they are obligated to pay in accordance with the terms hereof or of any other Loan Document, or (iii) the rights of, or benefits available to, the Administrative Agent and/or any of the Lenders under any Loan Document.

“Maturity Date” shall be either of the Revolving Facility Maturity Date or the Term Facility Maturity Date, as the context of this Agreement requires.

“Maximum Loan Amount” shall have the meaning set forth in Section 2.1.1(a).

“Maximum Rate” shall have the meaning set forth in Section 15.2.

“Net Operating Income” shall mean, for any period of determination, (i) net operating income generated by an Individual Property for such period (i.e., gross operating income, inclusive of any rent loss insurance, less expenses (including Ground Lease Payments (except to the extent of any portion of such payment which is treated as a payment under a capital lease in accordance with GAAP) and exclusive of debt service, capital expenditures and vacancy allowances and before depreciation and amortization), determined in accordance with GAAP, as generated by, through or under Leases, and (ii) all other income arising from direct operations of or licenses or operating agreements for any part of the Individual Property determined on a GAAP basis. For purposes hereof, all rental income shall be adjusted for straight line rents. Borrower shall provide the Administrative Agent with all information and materials required by the Administrative Agent necessary for the determination of Net Operating Income. If any Leases are scheduled to expire during such period of determination, no rents or other amounts payable under such Leases with respect to any portion of such period occurring after such scheduled expiration date shall be included in the determination of Net Operating Income for such period. If any Leases are scheduled to commence (and rent and occupancy pursuant thereto are also scheduled to commence) during such period of determination, the rents and other amounts payable under such Leases with respect to any period occurring after the scheduled commencement date shall be included in the determination of Net Operating Income for such period.

“Net Worth” shall mean (a) the sum of (i) total CRT shareholders’ equity in the Borrower and (ii) the limited partners’ interest in the Borrower (both controlling and non-controlling interests) as of the Calculation Date appearing on the consolidated financial statements of CRT as determined in accordance with GAAP, plus (b) depreciation and amortization provided after March 31, 2013 through the Calculation Date on a cumulative basis.

“Non-Extension Notice Date” shall have the meaning set forth in Section 2.7.2(c).

“Non-Reinstatement Deadline” shall have the meaning set forth in Section 2.7.2(d).

“Non-Retail Assets” shall mean Individual Properties that generate more than fifteen percent (15%) of base rental revenues from non-retail tenants.

“Note” shall mean, collectively, the various promissory notes payable to each Lender in the form of Exhibit B.

“Obligations” shall mean without limitation, all and each of the following, whether now existing or hereafter arising:

(a) Any and all direct and indirect liabilities, debts, and obligations of the Borrower or any Loan Party to the Administrative Agent or any Lender under or arising out of the Loan Documents, each of every kind, nature, and description.

(b) Each obligation to repay any loan, advance, indebtedness, note, obligation, overdraft, or amount now or hereafter owing by the Borrower or any Loan Party to the Administrative Agent or any Lender (including all future advances whether or not made pursuant to a commitment by the Administrative Agent or any Lender) under or arising out of the Loan Documents, whether or not any of such are liquidated, unliquidated, primary, secondary, secured, unsecured, direct, indirect, absolute, contingent, or of any other type, nature, or description, or by reason of any cause of action which the Administrative Agent or any Lender may hold against the Borrower or any Loan Party including, without limitation, any obligation arising under any Swap Contract with the Administrative Agent or any Lender.

(c) All notes and other obligations of the Borrower or any Loan Party now or hereafter assigned to or held by the Administrative Agent or any Lender under or arising out of the Loan Documents, each of every kind, nature, and description.

(d) All interest, fees, and charges and other amounts which may be charged by the Administrative Agent or any Lender to the Borrower or any Loan Party and/or which may be due from the Borrower or any Loan Party to the Administrative Agent or any Lender from time to time under or arising out of the Loan Doc