The following table presents summarized financial information of our equity investments in unconsolidated partnerships as of December 31, 2022 and 2021:


	December 31,
(in thousands of dollars)	2022			2021
ASSETS:
Investments in real estate, at cost:
Operating properties	$	741,007		$	847,560
Construction in progress		5,346			6,456
Total investments in real estate		746,353			854,016
Accumulated depreciation		(237,791	)		(247,133	)
Net investments in real estate		508,562			606,883
Cash and cash equivalents		28,186			59,004
Deferred costs and other assets, net		142,929			155,247
Total assets		679,677			821,134
LIABILITIES AND PARTNERS’ INVESTMENT:
Mortgage loans payable, net		400,141			493,904
FDP Term Loan, net		104,427			194,602
Partnership Loans		214,008			115,543
Other liabilities		155,873			141,619
Total liabilities		874,449			945,668
Net investment		(194,772	)		(124,534	)
Partners’ share		(102,495	)		(62,771	)
PREIT’s share		(92,277	)		(61,763	)
Excess investment (1)		6,986			6,718
Net investments and advances	$	(85,291	)	$	(55,045	)
Investment in partnerships, at equity	$	7,845		$	16,525
Distributions in excess of partnership investments		(93,136	)		(71,570	)
Net investments and advances	$	(85,291	)	$	(55,045	)

(1) Excess investment represents the unamortized difference between our investment and our share of the equity in the underlying net investment in the unconsolidated partnerships. The excess investment is amortized over the life of the properties, and the amortization is included in “Equity in (loss) income of partnerships.”

We record distributions from our equity investments using the nature of the distribution approach.

The following table summarizes our share of equity in loss of partnerships for the years ended December 31, 2022 and 2021:


	For the Year Ended December 31,
(in thousands of dollars)	2022			2021
Real estate revenue	$	109,390		$	120,861
Expenses:
Property operating and other expenses		(45,805	)		(52,111	)
Interest expense (1)		(51,319	)		(44,547	)
Depreciation and amortization		(23,918	)		(29,200	)
Total expenses		(121,042	)		(125,858	)
Net loss		(11,652	)		(4,997	)
Less: Partners’ share		5,507			1,469
PREIT’s share		(6,145	)		(3,528	)
Amortization of excess investment		-			(204	)
Equity in loss of partnerships	$	(6,145	)	$	(3,732	)

(1) Net of capitalized interest expense of $8 thousand and $347 thousand for the year ended December 31, 2022 and 2021, respectively.

In May 2021, PM Gallery LP, a Delaware limited partnership and joint venture entity owned indirectly by us and The Macerich Company (“Macerich”), sold, through a subsidiary, a portion of an asset at Fashion District Philadelphia (“FDP”) for $5.3 million. The sale resulted in a gain of $2.6 million for the joint venture, our share of which is $1.3 million at a 50% share. The gain is recorded in gain on sales of real estate by equity method investee in our consolidated statements of operations for the year ended December 31, 2021.

PM Gallery LP, a Delaware limited partnership and joint venture entity owned indirectly by us and The Macerich Company (“Macerich”), previously entered into a $250.0 million term loan in January 2018 (as amended in July 2019 to increase the total maximum potential borrowings to $350.0 million) to fund the redevelopment of Fashion District Philadelphia and to repay capital contributions to the venture previously made by the partners. On December 10, 2020, PM Gallery LP, together with certain other subsidiaries owned indirectly by us and Macerich (including the fee and leasehold owners of the properties that are part of the Fashion District Philadelphia project), entered into an Amended and Restated Term Loan Agreement (the “FDP Loan Agreement”). In connection with the execution of the FDP Loan Agreement, a $100.0 million principal payment was made (and funded indirectly by Macerich, the “Partnership Loan”) to pay down the existing loan, reducing the outstanding principal under the FDP Loan Agreement from $301.0 million to $201.0 million. In addition, subsequent payments were made on the FDP Loan Agreement as indicated below. The joint venture must repay the Partnership Loan plus 15% accrued interest to Macerich, in its capacity as the lender, prior to the resumption of 50/50 cash distributions to the Company and its joint venture partner.

The FDP Loan Agreement provides for (i) a maturity date of January 22, 2024, (having been extended by one year upon satisfaction of the required conditions to extension), (ii) an interest rate at the borrowers’ option with respect to each advance of either (A) the Base Rate (defined as the highest of (a) the Prime Rate, (b) the Federal Funds Rate plus 0.50%, and (c) the LIBOR Market Index Rate plus 1.00%) plus 2.50% or (B) LIBOR for the applicable period plus 3.50%, (iii) a full recourse guarantee of 50% of the borrowers’ obligations by PREIT Associates, L.P., on a several basis, (iv) a full recourse guarantee of certain of the borrowers’ obligations by The Macerich Partnership, L.P., up to a maximum of $50.0 million, on a several basis, (v) a pledge of the equity interests of certain indirect subsidiaries of PREIT and Macerich, as well as of PREIT-RUBIN, Inc. and one of its subsidiaries, that have a direct or indirect ownership interest in the borrowers, (vi) a non-recourse carve-out guaranty and a hazardous materials indemnity by each of PREIT Associates, L.P. and The Macerich Partnership, L.P., and (vii) mortgages of the borrowers’ fee and leasehold interests in the properties that are part of the Fashion District Philadelphia project and certain other properties. In January 2023, the FDP Loan Agreement was amended to replace the interest rate benchmark from LIBOR to SOFR. The Base Rate is defined as the highest of (a) the Prime Rate, (b) the Federal Funds Rate plus one half (0.50%) and (c) Adjusted Term SOFR for a one-month tenor plus one percent (1.00%). The FDP Loan Agreement contains certain covenants typical for loans of its type.

The FDP Loan Agreement had a balance of $104.4 million as of December 31, 2022. During 2022, the joint venture paid down the FDP Loan Agreement balance by $90.2 million in order to comply with the financial covenants. In January 2023, the joint venture paid down an additional $26.1 million of the FDP Loan Agreement balance to reach a debt yield ratio of 12% and exercised its option to extend the FDP Loan Agreement maturity date to January 22, 2024. If the joint venture fails to meet the debt yield covenant as of any quarter end measurement

date and does not pay down the FDP Loan Agreement balance to achieve compliance, the balance could become due and payable at that time. The Company guarantees 50% of the joint venture’s obligations under the FDP Loan Agreement, which is $39.2 million subsequent to the January 2023 paydown. Management projects that the Company would be able to satisfy its obligations if the FDP term loan would become due and payable by its maturity date.

In connection with the execution of the FDP Loan Agreement, the governing structure of PM Gallery LP was modified such that, effective as of January 1, 2021, Macerich is responsible for the entity’s operations and, subject to limited exceptions, controls major decisions. The Company considered the changes to the governing structure of PM Gallery LP and determined the investment qualifies as a variable interest entity and will continue to be accounted for under the equity method of accounting. Our maximum exposure to losses is limited to the extent of our investment, which is a 50% ownership, and the guarantee under the FDP Loan Agreement as noted above.

Mortgage loans, which are secured by six of the unconsolidated properties (including one property under development), are due in installments over various terms extending to the year 2031. Six of the mortgage loans bear interest at a fixed interest rate. The balances of the fixed interest rate mortgage loans have interest rates that range from 3.20% to 5.50% and had a weighted average interest rate of 4.11% at December 31, 2022. The liability under each mortgage loan is limited to the unconsolidated partnership that owns the particular property. The property total of principal payments due in the next five years and thereafter is as follows:



(in thousands of dollars) For the Year Ending December 31,	Property Total
2023	$	82,462
2024		7,675
2025		61,848
2026		8,323
2027 and thereafter		241,850
Total principal payments		402,158
Less: Unamortized debt issuance costs		2,017
Carrying value of mortgage notes payable	$	400,141

In October 2022, the Company's unconsolidated subsidiary completed a refinance of its mortgage loan securing a new mortgage for its property at Pavilion at Market East. The $8.75 million mortgage has a 3-year term, maturing in October 2025, with two one-year extension options. The loan has a fixed interest rate of 5.5%.

In May 2021, the Company’s unconsolidated subsidiary completed a refinance of its mortgage loan securing its property at Pavilion at Market East. The $7.6 million mortgage had a 2-year term, maturing in May 2023. The loan had interest only payments until May 2022 at a variable rate of the greater of (a) one month LIBOR plus 3.5% or (b) 4.0%.

Red Rose Commons
On June 30, 2021, the Company’s unconsolidated subsidiary completed a refinance of its mortgage loan securing its property at Red Rose Commons. The $34.0 million mortgage has a 10-year term, maturing on July 6, 2031 at a fixed interest rate of 3.3%.

The Court at Oxford Valley
On June 25, 2021, the Company’s unconsolidated subsidiary completed a refinance of its mortgage loan securing its property at the Court at Oxford Valley. The $55.0 million mortgage has a 10-year term, maturing on July 1, 2031. The loan has interest only payments until August 2024 at a fixed interest rate of 3.2%.

On March 1, 2022, the Company’s unconsolidated subsidiary exercised its one-year extension option of its mortgage loan securing its property at Gloucester Premium Outlets. The $86.0 million loan maturing on March 1, 2023 has a variable interest rate. In June 2022, we sold our 25% interest in the Gloucester Premium Outlets located in Blackwood, New Jersey for total consideration of $35.4 million, subject to customary working capital adjustments, consisting of $14.1 million in cash and $21.4 million in debt assumption. We recorded a gain of $9.1 million in connection with the sale and used net proceeds of $14.0 million from the sale to pay down our First Lien Revolving Facility and First Lien

Term Loan. Subsequent to the closing of the transaction, the working capital adjustment was finalized and the gain on sale of equity method investment was reduced by $0.1 million and net cash of $0.1 million was remitted by the Company.