A PREIT statement puts the selling price for the five-asset portfolio at approximately $110.7 million and says the price represents a return of about 11% on 2004 forecasted operating income from the malls. However, David Lichtenstein, Lightstone's CEO, tells GlobeSt.com, "Our cost, including fees, is about $120 million.

"We're a very aggressive buyer of retail," he says, noting that retail represents approximately 60% of his company's total portfolio and encompasses about 14 million sf in 27 states. Multifamily and industrial constitute the remaining 40%.

"Our (retail) niche is B and C assets. We have a great leasing team, and we roll up our sleeves." Of the five PREIT properties, he says, "there's a vacancy issue," which he says is about 15%. "Publicly traded REITs hand these kind of properties off to us. Typically, we close in 30 days. This gives (the seller) disposition of five assets in four states in one fell swoop. We're the Kleenex for the REIT industry."

The malls have an aggregate 2.6 million sf. They are: Bradley Square Mall in Cleveland, TN; Martinsburg Mall in Martinsburg, WV; Mount Barry Square Mall in Rome, GA; Shenango Valley Mall in Hermitage, PA, and West Manchester Mall in York, PA. Their in-line sales average $237 per sf, which is $75 per sf below the average for PREIT's other malls, including those from Crown. The sixth "non-core" mall from the Crown merger is Schuylkill Mall in Frackville, PA, which PREIT continues hold for sale.

PREIT estimates net proceeds from the sale to Lightstone at $108.5 million. Lightstone will forfeit its $2.5-million cash deposit if it does not close for any reason other than PREIT's failure to obtain the releases of the mortgage liens on West Manchester and Martinsburg Mall. PREIT expects the two properties will be replaced as collateral for the General Electric Capital Corp., Real Estate Mortgage Investment Conduit by Northeast Tower Center in Philadelphia and Jacksonville Mall in Jacksonville, NC. PREIT will use the proceeds from the sale to Lightstone to pay down its line of credit.

In a separate transaction, PREIT sells its 60%-ownership interest in Rio Grande Mall in Rio Grande, NJ to Freeco Development LLC, an affiliate of its joint-venture partner, for $4.1 million. That represents a return of approximately 11% on the property's 2004 forecasted operating income. PREIT expects a net gain of approximately $1.6 million. When completion these sales, PREIT's portfolio will contain 52 properties encompassing about 30.9 million sf in 12 states.