JENKINTOWN, PA-At the first shareholder meeting of American Financial Realty Trust since he took over the reigns 10 months ago, Harold Pote, president and CEO, said, “There’s still some work left to do,” following “an eventful year.” He declared the five-point repositioning plan that was put into place at the beginning of his tenure “a success,” and outlined the challenges ahead.

As confirmation of one of the five points–a promise of more transparency and straightforwardness in reporting–Pote spoke contemporaneously and candidly. He listed three routes to driving shareholder value.

Regarding the 900 buildings left in the AFR portfolio, he said management was working to lease up two million sf and drive down property-level operating expenses. Among the leasing challenges is Harbourside, a New Jersey property that currently provides a revenue stream of $12 million a year, which will drop off by year’s end.

AFR is in the process of releasing that asset, he said. There is also a 13-buiding portfolio, occupied by Bank of America, in which, according to prior agreements, the rental income declines at the end of 2010. Pote said, “We’re not waiting. We’ve begun renegotiating that agreement now.”

Having been out of the market for months, Pote also said the company is back in the process “of putting new good business on the books.” He said the pipeline is active, “and we pledge each piece of business will be accretive to shareholder value.” He has previously described targets as properties leased to financial institutions. At the shareholder meeting, he said, “It’s hard to imagine a stronger set of tenants than financial institutions in the US.”

Thirdly, AFR is looking at its capital structure “to see how to use it more effectively.” A major strategy for accomplishing this goal is to form JVs with others on assets in the portfolio and on acquisitions.

Following Pote’s presentation, a shareholder cited “frustration. Given the progress, why is the stock price relatively unchanged? What is Wall Street looking for?,” he asked.

Pote said the company still needed to demonstrate that it can handle the challenges ahead and that it can put well-structured new business on the books. Dave Nettina, president, said analysts are still saying, “Hey, prove it to me.”

Nettina also pointed out that the company stock has risen above the year-ago level. By mid-day June 6, following the shareholder meeting, AFR stock was trading at $11.05 per share, down just a penny from the previous day, compared with a drop of more than 100 points on the Dow. AFR shares hit a 52-week low of $9.59 per share on July 12, 2006 and reached a 52-week high of $12.25 per share on Sept. 5, 2006.

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