But, because the REIT acquired so many properties at once,primarily through its November 2003 acquisition of Crown American,Glickman said it was necessary to step up the pace in order tobring gains. "We realize redevelopment will have a short-termnegative impact on occupancy . . . and an interim fall-off inincome."

Net income fell 31.2% to $5.5 million during the quarter, downfrom $8 million in the same quarter a year ago. Net operatingincome reached $69.5 million, up 2% from $68.1 million, while samestore net operating income decreased by 2.4% compared with the samequarter of 2004. Occupancy in the portfolio at June 30 this yearwas 91.2%, compared with 92.3% at the same time a year ago.

PREIT detailed a more than $200-million redevelopment investmentthat is underway and expected to reach completion by year-end 2007."Our redevelopment and remerchandising activities gathered momentumduring the second quarter and are continuing," said Ronald Rubin,chairman and CEO, during the call. He announced that Whole Foodswill open at Plymouth Meeting Mall, calling it representative of"the creative strategies we are employing to enhance the value ofour retail assets."