
<PAGE>

                            SCHEDULE 14A INFORMATION
                Proxy Statement Pursuant to Section 14(a) of the
                         Securities Exchange Act of 1934

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /

Check the appropriate box:

/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only
    (as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Under Rule 14a-12


                               ACADIA REALTY TRUST
-----------------------------------------------------------------------------
                (Name of Registrant as Specified in Its Charter)


 -----------------------------------------------------------------------------
    (Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

    1) Title of each class of securities to which transaction applies:


       ----------------------------------------------------------------------
    2) Aggregate number of securities to which transaction applies:


       ----------------------------------------------------------------------
    3) Per unit price or other underlying value of transaction computed
       pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
       filing fee is calculated and state how it was determined):


       ----------------------------------------------------------------------
    4) Proposed maximum aggregate value of transaction:


       ----------------------------------------------------------------------

    5) Total fee paid:


       ----------------------------------------------------------------------

/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
    0-11(a)(2) and identify the filing for which the offsetting fee was
    paid previously. Identify the previous filing by registration statement
    number, or the form or schedule and the date of its filing.

    1) Amount Previously Paid:

    ___________________________________________________________________________
    2) Form, Schedule or Registration Statement No.:

    ___________________________________________________________________________
    3) Filing Party:

    ___________________________________________________________________________
    4) Date Filed:

    ___________________________________________________________________________

<PAGE>
                               ACADIA REALTY TRUST
                           20 SOUNDVIEW MARKETPLACE
                        PORT WASHINGTON, NEW YORK 11050

                   NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
                            TO BE HELD MAY 31, 2001


TO OUR SHAREHOLDERS:

     Please take notice that the Annual Meeting of Shareholders of Acadia
Realty Trust will be held on Thursday, May 31, 2001, at 10:00 a.m., local time,
at the offices of Credit Suisse First Boston, which are located at 277 Park
Avenue, New York, NY 10172, for the purpose of considering and voting upon:

     1. The election of seven trustees to hold office until the next Annual
        Meeting of Shareholders and until their successors are duly elected and
        qualified;

     2. The ratification of the appointment of Ernst & Young LLP as independent
        auditors for the Company for the fiscal year ending December 31, 2001;
        and

     3. Such other business as may properly come before the Annual Meeting or
        any adjournments thereof.

     The record date for determining shareholders entitled to notice of, and to
vote at, such Annual Meeting is the close of business April 30, 2001.

     Your attention is directed to the accompanying Proxy Statement and Proxy.


                                   By order of the Board of Trustees,


                                   /s/ Robert Masters
                                   -------------------------
                                   Robert Masters, Secretary

March 30, 2001

PLEASE COMPLETE, DATE, SIGN AND RETURN PROMPTLY THE ENCLOSED FORM OF PROXY IN
THE ENVELOPE PROVIDED FOR THAT PURPOSE WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING. NO POSTAGE IS REQUIRED FOR MAILING IN THE UNITED STATES.

<PAGE>

                              ACADIA REALTY TRUST
                           20 SOUNDVIEW MARKETPLACE
                        PORT WASHINGTON, NEW YORK 11050

                                PROXY STATEMENT
                                    FOR THE
                   ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
                                  May 31, 2001

                              GENERAL INFORMATION

     This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Trustees of Acadia Realty Trust (the "Company") for use
at the Annual Meeting of its shareholders scheduled to be held on Thursday, May
31, 2001, at 10:00 a.m., local time, or any postponement or adjournment thereof
(the "Annual Meeting"). This Proxy Statement and accompanying form of proxy
were first sent to shareholders on or about March 30, 2001.

     The Company will bear the costs of the solicitation of its proxies in
connection with the Annual Meeting, including the costs of preparing,
assembling and mailing proxy materials and the handling and tabulation of
proxies received. In addition to solicitation of proxies by mail, proxies in
connection with the Annual Meeting may be solicited by the trustees, officers
and employees of the Company, at no additional compensation, by telephone,
telegram, personal interviews or otherwise. Arrangements have been made with
brokerage firms, custodians, nominees and fiduciaries to forward solicitation
materials to the beneficial owners of common shares of beneficial interest, par
value $.001 per share, of the Company, (the "Common Shares") held of record by
such persons or firms with their nominees, and in connection therewith, such
firms will be reimbursed for their reasonable out-of-pocket expenses in
forwarding such materials.

     All properly executed and unrevoked proxies in the accompanying form that
are received in time for the Annual Meeting will be voted at the Annual Meeting
in accordance with the specification thereon. If no specification is made,
signed proxies will be voted "FOR" the election of the nominee for trustee
listed below and approval of the proposals set forth in the Notice of Annual
Meeting of the Shareholders of the Company. Any shareholder executing and
delivering a proxy has the right to revoke such proxy at any time prior to the
voting thereof by notice to the Company. In addition, although the mere
attendance at the Annual Meeting will not revoke a proxy, a person present at
the Annual Meeting may withdraw his or her proxy and vote at that time in
person.

                     OUTSTANDING SHARES AND VOTING RIGHTS

     The outstanding capital stock of the Company as of March 21, 2001
consisted of 28,015,672 shares of Common Shares. Holders of Common Shares are
entitled to one vote for each Common Share registered in their names on the
record date. The Board of Trustees of the Company (the "Board of Trustees") has
fixed the close of business on April 30, 2001 as the record date for
determination of shareholders entitled to notice of and to vote at the meeting.
The presence, in person or by proxy, of the holders of Common Shares entitled
to cast at least a majority of the outstanding Common Shares on April 30, 2001
will constitute a quorum to transact business at the Annual Meeting.

     The approval of a plurality of the votes cast by holders of Common Shares
in person or by proxy at the Annual Meeting in the election of trustees will be
required to approve the nominees for trustee at the Annual Meeting. There is no
cumulative voting in the election of trustees. The approval of a plurality of
the votes cast by holders of Common Shares in person or by proxy at the Annual
Meeting in the ratification of the appointment of the independent auditors will
be required to ratify the appointment of Ernst & Young LLP as independent
auditors.

     Proxies marked "abstain" and which have not voted on a particular proposal
are included in determining a quorum for the Annual Meeting. Abstentions and
broker non-votes are not treated as votes cast in the election

                                       1
<PAGE>
of trustees or in the ratification of the appointment of the independent
auditors, and thus are not the equivalent of votes against a nominee or against
the ratification of the appointment of Ernst & Young LLP as independent
auditors, as the case may be, and will not affect the vote with respect to
these matters.

                      PROPOSAL 1 -- ELECTION OF TRUSTEES

     The Bylaws provide that the Board of Trustees may be composed of up to a
maximum of 15 members. The Board of Trustees currently consists of seven
trustees, each of whom serves until the next annual meeting of shareholders and
until his successor is duly elected and qualified. Election of each trustee
requires the approval of a plurality of the votes cast by the holders of Common
Shares in person or by proxy at the Annual Meeting. As stated elsewhere herein,
the enclosed proxy will be voted for the election as trustee of each nominee
whose name is set forth below unless a contrary instruction is given. All of
the nominees currently serve as trustees of the Company. Management believes
that all of its nominees are willing and able to serve the Company as a
trustee. If any nominee at the time of election is unable or unwilling to serve
or is otherwise unavailable for election, and as a consequence thereof, other
nominees are designated, the persons named in the enclosed proxy or their
substitutes will have the discretion and authority to vote or refrain from
voting for other nominees in accordance with their judgment. The Board of
Trustees does not have a nominating committee.

     The following is a brief description of the nominees for election as
trustees of the Company.

     Ross Dworman, age 41, has been Chairman of the Company since August 1998,
when the Company acquired substantially all of the assets of RD Capital, Inc.,
a Delaware corporation ("RDC"). See "Certain Relationships and Related
Transactions." Mr. Dworman was also Chief Executive Officer of the Company
until Mr. Bernstein was elected to the additional post of Chief Executive
Officer in January, 2001. From 1987 to August 1998, Mr. Dworman was President
and Chief Executive Officer of RDC. From 1984 to 1987, Mr. Dworman was an
associate at Odyssey Partners, L.P., a hedge fund engaged in leveraged buy-outs
and real estate investment, and from 1981 until 1984, he was a Financial
Analyst for Salomon, Inc. Mr. Dworman received his Bachelor of Arts Degree from
the University of Pennsylvania.

     Kenneth F. Bernstein, age 39, was elected by the Board of Trustees to the
additional post of Chief Executive Officer in January, 2001. Previously, he had
been President of the Company since August 1998, when the Company acquired
substantially all of the assets of RDC. See "Certain Relationships and Related
Transactions." Mr. Bernstein is responsible for strategic planning as well as
overseeing the day-to-day activities of the Company including operations,
acquisitions and capital markets. From 1990 to August 1998, Mr. Bernstein was
the Chief Operating Officer of RDC. In such capacity, he was responsible for
overseeing the day-to-day operations of RDC and its management companies,
Acadia Management Company LLC and Sound View Management LLC. Prior to joining
RDC, Mr. Bernstein was associated with the New York law firm of Battle Fowler,
LLP, from 1986 to 1990. Mr. Bernstein received his Bachelor of Arts Degree from
the University of Vermont and his Juris Doctorate from Boston University School
of Law.

     Martin L. Edelman, age 59, has been a trustee of the Company since August
1998, and is Of Counsel to Paul, Hastings, Janofsky & Walker, LLP, a New York
City law firm specializing in real estate and corporate law, which has been
counsel to the Company since August 1998. He is one of the managing partners of
Chartwell Hotel Associates which owns and operates in excess of 30 hotels in
the U.S. and 10 in Mexico. He has been involved in all aspects of real estate
transactions including acquisitions, dispositions and financings. Mr. Edelman
is a graduate of Princeton University (1963) and Columbia University School of
Law (1966). He is currently a director of Capital Trust, Cendant Incorporated,
Delancey Estates PLC and Avis-Rent-a-Car Inc. Mr. Edelman is one of the
founders of the Jackie Robinson Foundation and a member of the Board of The
Intrepid Museum Foundation and the Fisher Alzheimer Foundation. Paul, Hastings,
Janofsky & Walker, LLP, rendered certain legal services to the Company during
2000. See "Certain Relationship and Related Transactions."

     Marvin J. Levine, age 51, has been a trustee of the Company since its
inception. Since February 1, 2000, Mr. Levine has been Of Counsel to (and is
currently a partner in) the firm of Blackwell Sanders Peper Martin in their
Omaha, Nebraska office. From July 1997 to January 31, 2000, Mr. Levine was a
partner in the New York City law firm of Wachtel & Masyr, LLP. Previously, he
had been a partner in the New York City law firms of Gold & Wachtel, LLP for
three years and, prior to that, he was at Stadtmauer, Bailkin, Levine & Masyr
for more

                                       2
<PAGE>
than five years. Mr. Levine represented Mark Development Group ("MDG"), the
Company's predecessor, from 1982 until the Company's initial public offering.
Mr. Levine rendered certain legal services to the Company during 2000. See
"Certain Relationships and Related Transactions."

     Lawrence J. Longua, age 59, has been a trustee of the Company since its
inception. Since September 2000, Mr. Longua has been a Senior Vice President
with Koeppel, Tenner Real Estate Services, Inc. Prior to his position at
Koeppel, Tener Real Estate Services, Inc., Mr. Longua was a consultant to
General Electric Investment Advisors and was employed at New York University's
Real Estate Institute in administration and as an instructor. From March 1998
until March 2000, Mr. Longua was a Senior Managing Director of the Witkoff
Group, LLC, an owner of major office properties in New York City. From 1990 to
February 1998, Mr. Longua had been a Senior Vice President and Assistant
General Manager of The Mitsubishi Trust & Banking Corporation where he had been
responsible for the management of a substantial portfolio of real estate debt
and equities. From 1984 to 1990, Mr. Longua was a Vice President and Manager of
Bankers Trust Company, and was responsible for overseeing a real estate debt
portfolio of approximately $3 billion. Mr. Longua currently is the Chairman of
the board of trustees of the Mortgage Bankers Association of the New York
Scholarship Foundation, a Governor of the Mortgage Bankers Association of New
York, a member of the New York University Appraisal Council and a member of the
New York University REIT roundtable. Mr. Longua is the former President of the
Mortgage Bankers Association of New York and is the former Director of the
Association of Foreign Investors in U.S. Real Estate.

     Gregory A. White, age 44, has been a trustee of the Company since August
1998. As of August 1998, Mr. White has been a Senior Vice President of Conning
Asset Management Company, a publicly traded investment management company
("Conning"). Mr. White was a founding partner and Managing Director of Schroder
Mortgage Associates ("Schroder") in New York, New York, from 1992 until
Conning's acquisition of Schroder in August 1998. Mr. White was associated with
Schroder from 1992 to 1999. Schroder was an investment adviser that specialized
in commercial mortgages and commercial mortgage backed securities. From 1988 to
1992, Mr. White was a Managing Director of the Salomon Brothers Inc. real
estate finance department. Mr. White also serves as a trustee of New Plan
Realty Trust. He has a B.S. degree in civil engineering from Tufts University
and an MBA from the Wharton School of Business. Mr. White is also on the
advisory board of the Guggenheim Realty Fund and is a visiting professor of
real estate finance at New York University.

     Lee S. Wielansky, age 49, has been a trustee of the Company since May
2000. Since November 2000, Mr. Wielansky has been Chief Executive Officer and
President of JDN Development Company, Inc. He was also a founding partner and
Chief Executive Officer of the Midland Development Group, Inc., a retail
developer of commercial real estate in the Mid-West, Denver, Dallas, Ohio,
North Carolina and Tennessee. He was responsible for overseeing the development
of more than fifty shopping centers in these regions. Mr. Wielansky serves as a
director of Regency Realty Corporation, a real estate investment trust, with
offices throughout the United States. Mr. Wielansky has been a director of
Allegiant Bancorp, Inc. since 1990 and its Vice Chairman since February, 1999.

Committees of the Board of Trustees

     The Board's Audit Committee (the "Audit Committee") is empowered to review
the scope and results of the audit by the Company's independent auditors. The
Audit Committee examines the accounting practices and methods of control and
the manner of reporting financial results. These reviews and examinations
include meetings with independent auditors, staff accountants and
representatives of management. The results of the Committee's examinations and
the choice of the Company's independent auditors are reported to the full Board
of Trustees. The Audit Committee includes no officers or employees of the
Company or its majority-owned subsidiary, Acadia Realty Limited Partnership, a
Delaware limited partnership of which the Company serves as general partner
(the "Operating Partnership"). Members of the Audit Committee during the last
fiscal year were Messrs. Longua, White and, Wielansky. The Audit Committees's
functions are detailed in a written Audit Committee Charter adopted by the
Board of Trustees, which is attached as Exhibit A to this Proxy Statement. The
Audit Committee met once during the last fiscal year. See "Report of the Audit
Committee."

                                       3
<PAGE>
     The Board's Compensation Committee (the "Compensation Committee") met once
during the last fiscal year for the purpose of evaluating key officers'
salaries and bonuses. Members of the Compensation Committee during the last
fiscal year were Messrs. Edelman and Levine. See "Report of the Compensation
and Share Option Plan Committees on Executive Compensation."

     The Board's Share Option Plan Committee (the "Share Option Plan
Committee") is responsible for administering the Company's 1999 Share Incentive
Plan (the "1999 Share Incentive Plan"), including determining eligible
participants, the number and terms of options granted and other matters
pertaining to the 1999 Share Incentive Plan. The Trustees' Plan is administered
by the Board of Trustees. Members of the Share Option Plan Committee during the
last fiscal year were Messrs. White and Longua. The Share Option Plan Committee
met once during the last fiscal year. See "Report of the Compensation and Share
Option Plan Committees on Executive Compensation."

Vote Required; Recommendation

     The election to the Board of Trustees of each of the seven nominees will
require the approval of a plurality of the votes cast by the holders of Common
Shares in person or by proxy at the Annual Meeting. The Board of Trustees
unanimously recommends that the shareholders vote FOR the election to the Board
of Trustees of each of the seven nominees.

Trustees' Attendance at Meetings

     The Board of Trustees held six meetings during the last fiscal year. Each
incumbent trustee of the Company attended 100% of the meetings of the Board of
Trustees and meetings held by all committees on which such trustee served
during the last fiscal year.

Trustees' Fees

     Each trustee who is not also an officer and full-time employee of the
Company or the Operating Partnership receives an annual trustee fee in the
amount of $15,000 plus a fee of $1,250 for each meeting of the Board of
Trustees and $1,000 for each committee meeting attended. Trustees who are
officers and full-time employees of the Company or the Operating Partnership
receive no separate compensation for service as a trustee or committee member.
Additionally, members of the Board of Trustees are reimbursed for travel and
lodging expenses associated with attending meetings of the Board of Trustees
and committees of the Board of Trustees. Additionally, pursuant to the 1999
Share Incentive Plan, non-employee trustees are entitled to automatic grants of
options to purchase 1,000 Common Shares following the annual meeting of
shareholders held during each year during which they serve as trustees, which
options vest in five equal cumulative annual installments commencing on the
date of grant. Pursuant to the 1999 Share Incentive Plan, options to purchase
5,000 Common Shares at an exercise price of $5.75 per Common Share were granted
to non-employee trustees on each of June 16, 1999 and May 16, 2000.

             PROPOSAL 2 -- RATIFICATION OF APPOINTMENT OF AUDITORS

     The Board of Trustees has selected Ernst & Young LLP as the Company's
independent auditors for the fiscal year ending December 31, 2001, and has
directed that the selection of the independent auditors be submitted for
ratification by the shareholders at the Annual Meeting.

     Shareholder ratification of the selection of Ernst & Young LLP as the
Company's independent auditors is not required by the Company's Declaration of
Trust, Bylaws or otherwise. However, the Board of Trustees is submitting the
selection of Ernst & Young LLP to the shareholders for ratification as a matter
of what it considers to be good corporate practice. If the shareholders fail to
ratify the selection, the Board of Trustees in its discretion may direct the
appointment of a different independent accounting firm at any time during the
year if the Board of Trustees determines that such a change would be in the
best interests of the Company and its subsidiaries.

                                       4
<PAGE>
     Representatives of Ernst & Young LLP are expected to be present at the
Annual Meeting to respond to shareholder's questions raised at the Annual
Meeting, and they will have the opportunity to address the meeting, if they so
desire.

Vote Required; Recommendation

     The approval of a plurality of the votes cast by holders of Common Shares
in person or by proxy at the Annual Meeting in the ratification of the
appointment of the independent auditors is required to ratify the appointment
of Ernst & Young LLP as independent auditors. The Board of Trustees unanimously
recommends that the shareholders vote FOR the ratification of Ernst & Young LLP
as independent auditors.

        SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The Company's authorized capital consists of 100,000,000 Common Shares. As
of March 21, 2001, the Company had 28,015,672 Common Shares outstanding, which
shares were held by 223 record holders. In addition, as of March 21, 2001, the
Company had 6,804,144 units of limited partnership interest in the Operating
Partnership ("OP Units") outstanding.

     The Company is not aware of any person or any "group" within the meaning
of Section 13(d)(3) of the Exchange Act that is the beneficial owner of more
than five percent of any class of the Company's voting securities other than as
set forth in the table below. The Company does not know of any arrangements at
present, the operation of which may, at a subsequent date, result in a change
in control of the Company.

     The following table sets forth, as of March 21, 2001, certain information
concerning the holdings of each person known to the Company to be beneficial
owner of more than five percent (5%) of the Common Shares at March 21, 2001,
and all Common Shares beneficially owned by each trustee, each nominee for
trustee, each executive officer named in the Executive Compensation Summary
table appearing elsewhere herein and by all trustees, and executive officers as
a group. Each of the persons named below has sole voting power and sole
investment power with respect to the shares set forth opposite his name, except
as otherwise noted.
<TABLE>
<CAPTION>
                                                        Number of Common
                                                      Shares Beneficially                                Percent of
Beneficial Owners                                            Owned                                         Class
-----------------                                     -------------------                                ----------
<S>                                                   <C>                                                <C>
Yale University (1) ..............................         6,155,092                                      21.97%
Five Arrows Realty Securities LLC (2) ............         3,226,667(3)                                   11.52
Howard Hughes Medical Institute (4) ..............         2,266,667                                       8.09
The Board of Trustees of the Leland Stanford
 Junior University (5) ...........................         2,133,333                                       7.61
Harvard Private Capital Realty, Inc. (6) .........         2,000,000(7)                                    7.14
Marvin L. Slomowitz (8) ..........................         1,918,840(9)                                    5.51
Kenneth F. Bernstein (10) ........................         1,001,872(11)                                   2.88
Perry Kamerman (10) ..............................           209,442(12)                                      *
Timothy J. Bruce (10) ............................            71,083(13)                                      *
Joseph Hogan (10) ................................            65,903(14)                                      *
Ross Dworman .....................................         2,149,403(15)                                   6.17
Gregory A. White .................................            64,629(16)                                      *
Martin L. Edelman ................................               600(17)                                      *
Marvin J. Levine .................................               600(17)                                      *
Lawrence J. Longua ...............................             1,600(18)                                      *
Lee S. Wielansky .................................             5,200(19)                                      *
All Executive Officers and Trustees as a Group
 (eleven persons) ................................         3,819,664(11,12,13,14,15,16,17,18,19)          10.97
</TABLE>
------------
(1) The business address of Yale University is c/o Yale University Investments
    Office, Real Estate, 230 Prospect Street, New Haven, CT 06511.

(2) The business address of Five Arrows Realty Securities LLC is c/o Rothschild
    Realty, Inc., 1251 Avenue of the Americas, 51st Floor, New York, NY 10020.

                                       5
<PAGE>
 (3) Rothschild Realty Investors II L.L.C. ("Rothschild"), a Delaware limited
     liability company and sole managing member of Five Arrows Realty Securities
     L.L.C., may be deemed the beneficial owner of these Common Shares. The
     business address of Rothschild is c/o Rothschild Realty, Inc. 1251 Avenue
     of the Americas, 51st Floor, New York, NY 10020.

 (4) The business address of Howard Hughes Medical Institute is 4000 Jones
     Bridge Road, Chevy Chase, MD 20815.

 (5) The business address of the Board of Trustees of the Leland Stanford Junior
     University is c/o Stanford Management Company, 2770 Sand Hill Road, Menlo
     Park, CA 94025.

 (6) The business address of Harvard Private Capital Realty, Inc. is 600
     Atlantic Avenue, Boston, MA 02210.

 (7) Charlesbank Capital Partners, LLC ("Charlesbank"), a Massachusetts limited
     liability company, pursuant to an agreement among Charlesbank, the
     President and Fellows of Harvard College and certain individuals, has sole
     power to direct the vote of these Common Shares and may be deemed the
     beneficial owner of these Common Shares. The business address of
     Charlesbank is 600 Atlantic Avenue, 26th Floor, Boston, MA 02210.

 (8) The business address of Mr. Slomowitz is c/o Mark Development Company, 600
     Third Avenue, Kingston, PA 18704.

 (9) Includes 121,000 OP Units which are immediately exchangeable into an
     equivalent number of Common Shares.

(10) The business address of each such person is c/o Acadia Realty Trust, 20
     Soundview Marketplace, Port Washington, NY 11050.

(11) Reflects the Common Shares beneficially owned by Mr. Bernstein in his
     individual capacity and the Common Shares deemed to be beneficially owned
     by Mr. Bernstein. The Common Shares directly owned by Mr. Bernstein in his
     individual capacity consist of (i) 261,691 OP Units which are immediately
     exchangeable into a like number of Common Shares, (ii) 18,204 vested
     restricted Common Shares of a total of 47,284 restricted Common Shares
     issued to Mr. Bernstein in 2001 and 2000, (iii) 8,000 Common Shares
     purchased by Mr. Bernstein on the open market and (iv) 583,333 vested
     options issued pursuant to the 1999 Share Incentive Plan. The Common
     Shares deemed to be beneficially owned by Mr. Bernstein consist of 26,933
     Common Shares beneficially held by Mr. Bernstein through his equity
     interest in RD New York VI LLC, the record holder of such Common Shares,
     and 103,711 OP Units which are immediately exchangeable into a like number
     of Common Shares, which OP Units are beneficially held by Mr. Bernstein
     through his equity interests in various corporations, limited liability
     companies and limited partnerships which are the record holders of such OP
     Units.

(12) Represents 50,000 OP Units which are immediately exchangeable into an
     equivalent number of Common Shares, 1,109 vested restricted Common Shares
     of a total of 2,905 restricted Common Shares issued to Mr. Kamerman in
     2001 and 2000, and 158,333 vested options issued pursuant to the 1999
     Share Incentive Plan.

(13) Represents 2,750 vested restricted Common Shares of a total of 8,000
     restricted Common Shares issued to Mr. Bruce in 2001 and 2000, and 68,333
     vested options issued pursuant to the 1999 Share Incentive Plan.

(14) Represents 903 vested restricted Common Shares of a total of 2,333
     restricted Common Shares issued to Mr. Hogan in 2001 and 2000, and 65,000
     vested options issued pursuant to the 1999 Share Incentive Plan.

(15) Reflects the Common Shares beneficially owned by Mr. Dworman in his
     individual capacity, either, directly or indirectly, and the Common Shares
     deemed to be beneficially owned by Mr. Dworman. The Common Shares directly
     owned by Mr. Dworman in his individual capacity consist of (i) 533,399 OP
     Units which are immediately exchangeable into a like number of Common
     Shares, (ii) 3,750 vested restricted Common Shares, of a total of 10,000
     restricted Common Shares which were issued to Mr. Dworman in 2001 and
     2000, (iii) 4,000 Common Shares purchased by Mr. Dworman on the open
     market and (iv) 1,000,000 vested options issued pursuant to the 1999 Share
     Incentive Plan. The Common Shares indirectly owned by

                                       6
<PAGE>

     Mr. Dworman in his individual capacity consist of 61,750 OP Units which are
     immediately exchangeable into a like number of Common Shares, which OP
     Units are beneficially held by Mr. Dworman through his equity interest in
     various limited partnerships which are the record holders of such OP Units.
     The Common Shares deemed to be beneficially owned by Mr. Dworman consist of
     107,728 Common Shares beneficially held by Mr. Dworman through his equity
     interest in RD New York VI LLC, the record holder of such Common Shares,
     and 438,776 OP Units which are immediately exchangeable into a like number
     of Common Shares, which OP Units are beneficially held by Mr. Dworman
     through his equity interests in various corporations, limited liability
     companies and limited partnerships which are the record holders of such OP
     Units.

(16) Represents 17,029 OP Units which are immediately exchangeable into an
     equivalent number of Common Shares and 32,000 Common Shares, all of which
     are owned by Mr. White's wife, 15,000 Common Shares held in Mr. White's
     children's names, and 600 vested options issued pursuant to the 1999 Share
     Incentive Plan.

(17) Represents vested options issued pursuant to the 1999 Share Incentive
     Plan.

(18) Represents 1,000 Common Shares purchased by Mr. Longua on the open market
     and 600 vested options issued pursuant to the 1999 Share Incentive Plan.

(19) Represents 5,000 Common Shares purchased by Mr. Wielansky on the open
     market and 200 vested options issued pursuant to the 1999 Share Incentive
     Plan.


                                       7
<PAGE>
                            EXECUTIVE COMPENSATION

Summary Compensation Table

     The following table shows for the fiscal years ended December 31, 2000,
1999 and 1998, the annual and long-term compensation paid and accrued by the
Company to the Company's Chief Executive Officer and to each of the four most
highly compensated executive officers whose total annual compensation for
fiscal year 2000 exceeded $100,000.
<TABLE>
<CAPTION>
                                           Annual Compensation
                            --------------------------------------------------
                                                                     Other
                                                                    Annual
                             Fiscal      Salary       Bonus      Compensation
                              Year        ($)         ($)(5)          ($)
                            --------  -----------  -----------  --------------
<S>                         <C>       <C>          <C>          <C>
Ross Dworman                2000       $315,700     $176,324        $  --(2)
Chief Executive             1999        287,000      265,594           --(2)
 Officer(4)                 1998        110,385       55,827           --(2)

Kenneth F. Bernstein(4)     2000        275,000      103,000           --(2)
President                   1999        250,000      130,000           --(2)
                            1998         96,154       48,630           --(2)

Timothy J. Bruce            2000        185,000       63,824           --(2)
Senior Vice President --    1999        186,563       67,000           --(2)
Director of Leasing         1998         16,154           --           --(2)

Perry Kamerman              2000        170,000       68,499           --(2)
Senior Vice President --    1999        150,000       69,000           --(2)
Chief Financial Officer     1998         53,269       30,000           --(2)

Joseph Hogan                2000        180,000       70,000           --
Senior Vice President --    1999        121,154       42,000           --
Director of Construction    1998             --           --           --

                                              Long-Term Compensation
                            ----------------------------------------------------------
                             Restricted                   Long-Term           All
                                Share                   Compensation         Other
                               Awards      Options         Payouts        Compensation
                               ($)(5)      SARs($)           (#)             ($)(1)
                            ------------  ---------  ------------------  -------------
<S>                         <C>           <C>        <C>                 <C>
Ross Dworman                  $ 28,750       $--                 --         $    --
Chief Executive                 26,875        --          1,000,000(3)           --
 Officer(4)                         --        --                 --              --

Kenneth F. Bernstein(4)        125,074        --                 --           5,100
President                      124,469        --            500,000(3)        4,800
                                    --        --                 --              --

Timothy J. Bruce                28,750        --             10,000(3)        4,910
Senior Vice President --        14,625        --             50,000(3)           --
Director of Leasing                 --        --                 --              --

Perry Kamerman                   7,895        --             10,000(3)        5,100
Senior Vice President --         7,469        --            140,000(3)        4,800
Chief Financial Officer             --        --                 --              --

Joseph Hogan                     6,072        --             10,000(3)        4,569
Senior Vice President --         6,225        --             50,000(3)           --
Director of Construction            --        --                 --              --
</TABLE>
------------
(1) Represents contributions made by the Company to the account of the named
    executive officer under a 401(k) Plan.
(2) Did not exceed the lesser of $50,000 or 10% of the total annual salary and
    bonus for the named individual.
(3) Represents options granted under the Company's 1999 Share Incentive Plan.
(4) Mr. Bernstein was appointed the Company's Chief Executive Officer effective
    as of January 1, 2001.
(5) Executives may elect to receive their bonus, or a portion thereof, in Common
    Shares under the Restricted Share Bonus Program (defined below). Mr. Dworman
    made such elections for $23,676 and $21,406 of his 2000 and 1999 bonuses,
    respectively, for which the Common Shares were granted in January 2000 and
    2001, respectively. Mr. Bernstein made such elections for $103,000 and
    $120,000 of his 2000 and 1999 bonuses, respectively, for which Common Shares
    were granted in January 2000 and 2001, respectively, Mr. Bruce made such
    elections for $23,676 and $14,100 of his 2000 and 1999 bonuses,
    respectively, for which Common Shares were granted in January 2000 and 2001,
    respectively, Mr. Kamerman made such elections for $6,500 and $7,200 of his
    2000 and 1999 bonuses, respectively, for which Common Shares were granted in
    January 2000 and 2001, respectively. Mr. Hogan made such elections for
    $5,000 and $6,000 of his 2000 and 1999 bonuses, respectively, for which
    Common Shares were granted in January 2000 and 2001, respectively.

                                       8
<PAGE>
Share Option Grants, Exercises and Holdings

     The following tables set forth certain information concerning share
options granted to the persons named in the Summary Compensation Table above
during fiscal year 2000 and unexercised share options held by such persons at
the end of fiscal year 2000.

                    Share Option Grants in Fiscal Year 2000
<TABLE>
<CAPTION>
                                         Percentage of
                                         Total Annual
                                         Options/SARs                                 Potential Realizable Value At
                                          Granted to                                             Assumed
                            Option/      Employees in      Exercise or                  Annual Rate of Share Price
                             SARs         Fiscal Year      Base Price/     Expiration        for Option Term
        Name(1)           Granted(2)         2000         Per Share(3)        Date           5%           10%
----------------------   ------------   --------------   --------------   ------------   ----------   ----------
<S>                      <C>            <C>              <C>              <C>            <C>          <C>
Ross Dworman                    --              --               --               --           --           --
Kenneth F. Bernstein            --              --               --               --           --           --
Timothy J. Bruce            10,000            18.2%          $ 5.00         1/2/2010      $31,400      $79,700
Perry Kamerman              10,000            18.2%          $ 5.00         1/2/2010      $31,400      $79,700
Joseph Hogan                10,000            18.2%          $ 5.00         1/2/2010      $31,400      $79,700
</TABLE>
------------
(1) See Executive Compensation Summary Table for titles of the persons named
    above.
(2) Represents options granted under the 1999 Share Incentive Plan. All of the
    options were 100% vested at the date of grant.
(3) All options were granted at an exercise price greater than the market price
    of the Company's Common Shares on the date of grant.

                      2000 Fiscal Year End Option Values
<TABLE>
<CAPTION>
                                                                        Value of
                                                      Number of        Unexercised
                                                     Unexercised      in-the-Money
                                                     Options/SARs     Options/SARs
                                                      at Fiscal         at Fiscal
                           Shares                    Year-End(2)       Year-End(3)
                          Acquired                 ---------------   --------------
                             on          Value       Exercisable/     Exercisable/
        Name(1)           Exercise     Realized     Unexercisable     Unexercisable
----------------------   ----------   ----------   ---------------   --------------
<S>                      <C>          <C>          <C>               <C>
Ross Dworman                 --           --         1,000,000/-        $     --
Kenneth F. Bernstein         --           --           500,000/-              --
Timothy J. Bruce             --           --            60,000/-         6,250/-
Perry Kamerman               --           --           150,000/-         6,250/-
Joseph Hogan                 --           --            60,000/-         6,250/-
</TABLE>
------------
(1) See Summary Compensation Table for title of the persons named above.
(2) Represents options granted under the 1999 Share Incentive Plan. With the
    exception of 10,000 options issued to each of Messrs. Bruce, Kamerman and
    Hogan, which vested 100% at the date of grant, one-third of the remaining
    options vested as of the grant and one-third on each anniversary
    thereafter.
(3) Based on a closing price of $5.625 for the underlying Common Shares as of
    December 31, 2000.

Employment Contracts.

     Ross Dworman. In August of 1998, the Company entered into an employment
agreement with Ross Dworman, pursuant to which he served as Chairman and Chief
Executive Officer. Under the employment agreement, Mr. Dworman was compensated
at the rate of $287,000 per year. This compensation rate was subject to an
annual review. In January of 2000, the Compensation Committee increased Mr.
Dworman's base compensation by 10% to $315,700 for the calendar year ending
December 31, 2000. Effective as of January 1, 2001, Mr. Dworman resigned as
Chief Executive Officer of the Company and consequently, the terms of his
employment agreement were amended to reflect such change. Under the amended
terms of his employment agreement, Mr. Dworman's base compensation was reduced
to $175,000 per year. Each year during the term of Mr. Dworman's

                                       9
<PAGE>
employment commencing with the calendar year ending December 31, 1999, the
Compensation Committee will consider Mr. Dworman for an incentive bonus (to be
determined by the Compensation Committee) and discretionary bonuses or options
to purchase Common Shares as the Board of Trustees, the Share Option Plan
Committee or the Compensation Committee may approve. The Compensation Committee
awarded a bonus of $287,000 to Mr. Dworman for the calendar year ended December
31, 1999. Mr. Dworman received $200,000 of this bonus in cash in 1999 and
elected to receive $21,406 of the remaining $87,000 in Common Shares under the
Restricted Share Bonus Program. Therefore, in January 2000, the Company issued
to Mr. Dworman Common Shares with a value at the time of issuance of $26,875
and in March 2000, Mr. Dworman received the remainder of his bonus, $65,594, in
cash. For the year ended December 31, 2000, the Compensation Committee awarded
a bonus of $200,000 to Mr. Dworman. Mr. Dworman received $176,324 of this bonus
in cash in 2000 and elected to receive the remaining $23,676 in Common Shares
under the Restricted Share Bonus Program. Therefore, in January 2001, the
Company issued to Mr. Dworman Common Shares with a value at the time of
issuance of $28,750. The employment agreement, provides for a three-year term,
is renewable for successive daily periods, and is subject to termination in
accordance with the terms and conditions of such agreement.

     Under the employment agreement, Mr. Dworman received options to purchase
an aggregate of 1,000,000 Common Shares, exercisable at $7.50 per share, which
options have fully vested. The options are subject to customary antidilution
provisions. The terms of the options may be modified by the terms of any share
option plan adopted by the Company.

     The employment agreement also provides for an annual car allowance plus
insurance costs for Mr. Dworman to be maintained by the Company. Mr. Dworman is
also entitled to participate in all benefit plans, health insurance,
disability, retirement and incentive compensation plans generally available to
the Company's executives, and is subject to certain non-competition and
confidentiality requirements.

     The employment agreement provides for certain termination or severance
payments to be made by the Company to Mr. Dworman in the event of his
termination of employment as the result of his death, disability, discharge
with or without Cause (as defined therein), his resignation or a termination by
Mr. Dworman for "good reason," including, a Change of Control (as defined
therein) of the Company. If Mr. Dworman's employment is terminated either
because he is discharged without cause or due to a termination by Mr. Dworman
for "good reason," including, a Change of Control, the Company will be required
to make a lump sum payment equal to among other things, unpaid salary and
bonus, and unpaid severance salary and bonus, each paid in accordance with the
terms and conditions of such agreement.

     Kenneth F. Bernstein. In August of 1998, the Company entered into an
employment agreement with Kenneth F. Bernstein, pursuant to which Mr. Bernstein
served as President. Under the employment agreement, Mr. Bernstein was
compensated at the rate of $250,000 per year, subject to an annual review and
upward adjustment by the Compensation Committee. In January 2000, the
Compensation Committee increased Mr. Bernstein's annual base compensation by
10% to $275,000 for the calendar year ending December 31, 2000. Effective as of
January 1, 2001, Mr. Bernstein was appointed to the additional position of
Chief Executive Officer of the Company. In connection with Mr. Bernstein's
appointment to the position of Chief Executive Officer, the terms of his
employment agreement were amended. Under the amended terms of his employment
agreement, Mr. Bernstein's annual compensation was increased to $300,000 per
year. Each year during the term of Mr. Bernstein's employment commencing with
the calendar year ending December 31, 1999, the Compensation Committee will
consider Mr. Bernstein for an incentive bonus (to be determined by the
Compensation Committee) and discretionary bonuses or options to purchase Common
Shares as the Board of Trustees, the Share Option Plan Committee or the
Compensation Committee may approve. The Compensation Committee awarded a bonus
of $250,000 to Mr. Bernstein for the calendar year ended December 31, 1999. Mr.
Bernstein elected to receive $120,000 of this bonus in Common Shares under the
Restricted Share Bonus Program and the remainder in cash. Therefore, in January
2000, the Company issued to Mr. Bernstein Common Shares with a value at the
time of issuance of $124,469 and in March 2000, Mr. Bernstein received
$130,000, in cash. The Compensation Committee awarded a bonus of $206,000 to
Mr. Bernstein for the calendar year ended December 31, 2000. Mr. Bernstein
elected to

                                       10
<PAGE>
receive $103,000 of this bonus in Common Shares under the Restricted Share
Bonus Program and the remainder in cash. Therefore, in January, 2001, the
Company issued to Mr. Bernstein Common Shares with a value at the time of
issuance of $125,074 and received $103,000, in cash. The employment agreement
provides for a three-year term, is renewable for successive daily periods, and
is subject to termination in accordance with the terms and conditions of such
agreement.

     Under the employment agreement, Mr. Bernstein received options to purchase
an aggregate of 500,000 Common Shares, exercisable at $7.50 per share, which
options have fully vested. In addition, under the 1999 Share Incentive Plan,
Mr. Bernstein is being issued, effective as of January 1, 2001, options to
purchase an additional 250,000 Common Shares, exercisable at $6.00 per share,
which options vest equally over three years with one-third immediately vested
as of the award date, and one-third on each anniversary thereafter. The options
are subject to customary antidilution provisions. The terms of the options may
be modified by the terms of any share option plan adopted by the Company.

     The employment agreement also provides for an annual car allowance plus
insurance costs for Mr. Bernstein to be maintained by the Company. Mr.
Bernstein is also entitled to participate in all benefit plans, health
insurance, disability, retirement and incentive compensation plans generally
available to the Company's executives, and is subject to certain
non-competition and confidentiality requirements.

     The employment agreement provides for certain termination or severance
payments to be made by the Company to Mr. Bernstein in the event of his
termination of employment as the result of his death, disability, discharge
with or without Cause (as defined therein), his resignation or a termination by
Mr. Bernstein for "good reason," including, a Change of Control (as defined
therein) of the Company. If Mr. Bernstein's employment is terminated either
because he is discharged without cause or due to a termination by Mr. Bernstein
for "good reason," including, a Change of Control, the Company will be required
to make a lump sum payment equal to among other things, unpaid salary and
bonus, and unpaid severance salary and bonus, each paid in accordance with the
terms and conditions of such agreement.

Employee Benefit Plans

     The Company provides a variety of medical, dental, vision, life,
disability and accidental death and dismemberment insurance policies that are
generally available to all of its full-time employees. The Company also
provides a contributory 401(k) savings plan to employees of the Company.

               REPORT OF THE COMPENSATION AND SHARE OPTION PLAN
                     COMMITTEES ON EXECUTIVE COMPENSATION

     The Compensation Committee, composed of outside trustees of the Board of
Trustees, reviews the performance of the Company's executive personnel and
develops and makes recommendations to the Board of Trustees with respect to
executive compensation policies, including the awarding of appropriate bonuses.
The Share Option Plan Committee, composed of outside trustees of the Board of
Trustees, is empowered by the Board of Trustees to recommend to the Board of
Trustees those executive officers to whom share options and restricted share
awards should be granted and the number of common shares to which such options
and awards should be subject.

     Each committee has access to independent compensation data and is
authorized, if determined appropriate in any particular case, to engage outside
compensation consultants.

     The objectives of each committee are to support the achievement of desired
Company performance, to provide compensation and benefits that will attract and
retain superior talent and reward performance and to fix a portion of
compensation to the outcome of corporate performance.

     The executive compensation program is generally comprised of base salary,
discretionary performance bonuses and long term incentives in the form of share
options and restricted share awards. The compensation program also includes
various benefits, including health insurance plans and programs and pension and
profit sharing and retirement plans in which substantially all of the Company's
employees participate.

                                       11
<PAGE>
     Base salary levels for the Company's executive officers are competitively
set relative to salaries of officers of companies comparable in business, size
and location. In each instance, base salary takes into account individual
experience and performance specific to the Company.

     The Compensation Committee is empowered to approve the payment of cash
performance bonuses to employees, including executive officers, of the Company.
Performance bonuses are paid based upon the degree of achievement of a
specified earnings goal. The amount of the target bonus is determined by each
employee's level of responsibility and material contributions to the success of
the Company. In 1999, the Compensation Committee recommended the payment of an
aggregate of $1,023,800 in bonuses of which $215,000 was paid in 1999 and
$808,800 in 2000. In addition, in 1999, the Compensation Committee authorized
the issuance of options to purchase 50,000 Common Shares, exercisable at $5.00
per share, which options vested immediately. In 2000, the Compensation
Committee approved the payment of an aggregate of $1,406,300 in bonuses of
which $281,500 was paid in 2000 and $1,124,800 in 2001. Additionally, in 2001,
the Compensation Committee authorized the issuance of options to purchase
465,000 Common Shares, exercisable at $6.00 per share, which options vest
equally over three years with one-third immediately vested as of the award date
and one-third on each anniversary thereafter.

     The Board of Trustees has instituted a program to encourage all executives
who have been awarded bonuses to elect to receive payment of all or any portion
thereof in Common Shares rather than cash (the "Restricted Share Bonus
Program"). Under the Restricted Share Bonus Program, to the extent that an
executive elects to receive his or her bonus in Common Shares, such executive
will receive Common Shares at 80% of the preceding 20 day average of the Common
Share price on the open market. These Common Shares vest equally over three
years with 25% immediately vested as of the award date, and 25% on each
anniversary thereafter. However, the executive is entitled to dividends on all
shares prior to vesting.

     The Board of Trustees believes that employee equity ownership provides
significant additional motivation to executive officers to maximize value for
the Company's shareholders and, therefore, has authorized the Share Option Plan
Committee to periodically recommend to the Board of Trustees grants of share
options and restricted share awards to the Company's employees, including
executive officers. Share options are granted typically at prevailing market
price and, therefore, will only have value if the Company's share price
increases over the exercise price. The Share Option Plan Committee believes
that the grant of share options and restricted share awards provides a long
term incentive to such persons to contribute to the growth of the Company and
establishes a direct link between compensation and shareholder return, measured
by the same index used by shareholders to measure Company performance. The
terms of options and restricted share awards granted by the Board of Trustees,
including vesting, exercisability and term, are determined by the Share Option
Plan Committee, subject to requirements imposed by the plans under which such
options and awards may be granted, based upon relative position and
responsibilities of each executive officer, historical and expected
contributions of each officer to the Company, previous option grants to
executive officers and a review of competitive equity compensation for
executive officers of similar rank in companies that are comparable to the
Company's industry, geographic location and size. For information regarding
recent options granted to the Company's executive officers, reference is made
to the tables set forth in the Proxy Statement under the caption "Executive
Compensation."

     The Compensation Committee is aware that a recent amendment to the
Internal Revenue Code of 1986 treats certain elements of executive compensation
in excess of $1.0 million a year as an expense not deductible by the Company
for federal income tax purposes. Currently, no executive officer's
compensation, as determined in accordance with these regulations, exceeds the
$1.0 million cap. Accordingly, the Compensation Committee has not yet
established a policy which would address compensation to the Company's
executive officers in light of the cap.

                             Compensation Committee

                               Martin L. Edelman
                                Marvin J. Levine

                          Share Option Plan Committee

                              Lawrence J. Longua
                                Gregory A. White

                                       12
<PAGE>
                        AUDIT COMPENSATION INFORMATION

Audit Fees. The aggregate fees billed for professional services rendered by
Ernst & Young LLP for the Audit of the Company's financial statements were
$160,000, as included in the Company's form 10-K for the year ended December
31, 2000.

Financial Information System Design and Implementation Fees. There were no
additional fees billed for services rendered by Ernst & Young LLP relating to
financial information systems design and Implementation for the year ended
December 31, 2000.

All Other Fees. The aggregate fees billed for services rendered by Ernst &
Young LLP other than the services covered in the captions entitled Audit Fees
and Financial Information Systems Design and Implementation Fees, set forth
above, were $264,000 for the year ended December 31, 2000.

                         REPORT OF THE AUDIT COMMITTEE

The following report does not constitute soliciting materials and is not
considered filed or incorporated by reference into any other Company filing
under the Securities Act of 1933 or the Securities Exchange Act of 1934, unless
we state otherwise.

     The Audit Committee presently consists of the following members of the
Company's Board of Trustees: Messrs. Longua, White and, Wielansky. Messrs.
Longua, White and Wielansky are "independent" as defined under the listing
standards of the New York Stock Exchange (NYSE).

     The Audit Committee has reviewed and discussed the audited financial
statements of the Company for the year ended December 31, 2000 with the
Company's management. The Audit Committee has discussed with Ernst & Young LLP,
the Company's auditors, the matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit Committees).

     The Audit Committee has also received the written disclosures and the
letter from Ernst & Young LLP required by Independence Standards Board Standard
No. 1 (Independence Discussion with Audit Committees) and the Audit Committee
has discussed the independence of Ernst & Young LLP with that firm.

     The Audit Committee has considered whether the Financial Systems Design
and Implementation Fees and All Other Fees billed for professional services
rendered by Ernst & Young LLP is compatible with maintaining the principal
accountant's independence.

     Based on the Audit Committee's review and discussions noted above, the
Audit Committee recommended to the Board of Directors that the Company's
audited financial statements be included in the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 2000 for filing with the Securities
and Exchange Commission.

LAWRENCE J. LONGUA
GREGORY A. WHITE
LEE S. WIELANSKY


                                       13
<PAGE>
                         SHARE PRICE PERFORMANCE GRAPH

     The following graph compares the cumulative total shareholder return for
the Common Shares for the period commencing December 31, 1995 through December
31, 2000 with the cumulative total return on the Standard & Poor's 500 Stock
Index (the "S&P 500"), and the Morgan Stanley REIT Index (the "Index") over the
same period. Total return values for the S&P 500, the Index and the Common
Shares were calculated based upon cumulative total return assuming the
investment of $100 in each of the S&P 500, the Index and the Common Shares on
December 31, 1995, and assuming reinvestment of such dividends. The shareholder
return as set forth in the below is not necessarily indicative of future
performance.


                               [GRAPHIC OMITTED]


<TABLE>
<CAPTION>
                                                                    Period Ending
                                      --------------------------------------------------------------------------
Index                                  12/31/95     12/31/96     12/31/97     12/31/98     12/31/99     12/31/00
----------------------------------------------------------------------------------------------------------------
<S>                                   <C>          <C>          <C>          <C>          <C>          <C>
Acadia Realty Trust ...............     100.00       101.24        97.05        56.61        54.80        72.54
S&P 500 ...........................     100.00       122.86       163.86       210.64       254.97       231.74
Morgan Stanley REIT Index .........     100.00       135.90       161.15       133.91       127.81       162.08
</TABLE>

                                       14
<PAGE>
                CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

RDC Transaction.

     On August 12, 1998, the Company completed a major reorganization ("RDC
Transaction") in which it acquired twelve shopping centers, five multi-family
properties and a 49% interest in one shopping center along with certain third
party management contracts and promissory notes from real estate investment
partnerships ("RDC Funds") managed by affiliates of RD Capital, Inc.. In
exchange for these and a cash investment of $100 million, the Company issued
11.1 million OP Units and 15.3 million Common Shares to the RDC Funds. After
giving effect to the conversion of OP Units, which are generally exchangeable
for Common Shares on a one-for-one basis, the RDC Funds beneficially owned 72%
of the Common Shares as of the closing of the RDC Transaction. The Company is
also obligated to issue OP Units valued at $2.8 million upon the commencement
of rental payments from a designated tenant at one of the acquired properties.

     In March 2000, the RDC Funds, in accordance with their respective
partnership agreements (the "RDC Fund Partnership Agreements"), distributed to
their respective limited partners the Common Shares which had been issued to
the RDC Funds in connection with the RDC Transaction. Pursuant to a
registration and lock-up agreement, dated as of the date of the RDC Transaction
(the "Registration Agreement"), in March 2000, the Company filed a registration
statement with the Securities and Exchange Commission to permit the resale of
such Common Shares, which registration statement was declared effective in
March 2000. Pursuant to the RDC Fund Partnership Agreements and the
Registration Agreement, such limited partners had agreed to certain
restrictions on the sale of such Common Shares by such limited partners which
expired December 28, 2000. During 2000, three limited partners converted a
total of 3,679,999 OP Units into an equivalent number of Common Shares.

Future Equity Offerings

     In connection with the RDC Transaction, the Company agreed that following
the Closing, if the Board of Trustees determines, in the exercise of its
duties, to engage in an offering of preferred stock convertible into Common
Shares, then, upon commencement of any such offering, the Company shall use
commercially reasonable efforts to provide a right of first preference to those
partners of the RDC Funds who are equity owners of the RDC Funds on the date of
the Closing and who have made capital contributions to permit the RDC Funds to
meet their obligations to make certain cash investment at the Closing, to
purchase such convertible preferred stock, on terms and conditions which will
be identical to the offer and sale of any preferred stock to investors other
than such partners, provided that any such rights of first preference shall be
made only and if to the extent permitted by applicable federal, state and
securities laws and that the terms of any such rights of first preference shall
only be in a manner determined fair and equitable to the Company.

Certain Payments in Connection with the Sale of Properties Acquired in the RDC
Transaction

     In connection with the RDC Transaction, the Company agreed that for a
period of five years following the closing of the RDC Transaction that it would
be prohibited from the selling, transferring or otherwise disposing of the
properties contributed in connection with the RDC Transaction unless either (i)
the transaction was structured to defer the recognition of gain for Federal
income tax purposes or (ii) the Company were to make a payment to the partners
of the RDC Funds that contributed such property of an amount equal to the tax
which the partners would be obligated to pay upon the sale, together with a
"gross-up" to cover the taxes imposed on the receipt of such tax payment.
During December 2000, the Company closed on the sale of a 71% condominium
interest in the Abington Towne Center to the Target Corporation. As a result,
the Company currently estimates that the partners of such RDC Funds have
incurred a tax liability of approximately $450,000. Including the gross-up, the
total tax liability is estimated to be approximately $640,000. Approximately
$275,000 of the tax liability is owed to Messrs. Dworman and Bernstein, or
entities they own.

Other

     During 2000, Marvin J. Levine rendered legal services to the Company.

     Paul, Hastings, Janofsky & Walker LLP, a New York City law firm of which
Martin L. Edelman is Of Counsel, has been counsel to the Company since August
1998.

                                       15
<PAGE>
                          ANNUAL SHAREHOLDERS REPORT

     A copy of the Company's Annual Report to Shareholders is being provided to
each shareholder of the Company along with this Proxy Statement. Upon written
request of any record or beneficial owner of Common Shares of the Company whose
proxy was solicited in connection with the Annual Meeting, the Company will
furnish such owner, without charge, a copy of its Annual Report on Form 10-K
for the year ended December 31, 2000. A request for a copy of such Annual
Report on Form 10-K should be made in writing, addressed to Acadia Realty
Trust, 20 Soundview Marketplace, Port Washington, New York 11050, (516)
767-8830, Attention: Robert Masters.

                                 OTHER MATTERS

     As of the date of this Proxy Statement, the Board of Trustees does not
know of any matters to be presented at the Annual Meeting other than those
specifically set forth in the Notice of Annual Meeting of Shareholders. If
other proper matters, however, should come before the Annual Meeting or any
adjournment thereof, the persons named in the enclosed proxy intend to vote the
shares represented by them in accordance with their best judgement in respect
to any such matters.

            SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

     Section 16(a) of the Exchange Act requires the Company's officers and
trustees and persons who own more than ten percent of the Common Shares
(collectively, the "Reporting Persons") to file reports of ownership and
changes in ownership with the Securities and Exchange Commission and to furnish
the Company with copies of these reports. Based on the Company's review of the
copies of these reports received by it, the Company has determined that all
reports were timely filed for the period January 1, 2000 through December 31,
2000.

                      SUBMISSION OF SHAREHOLDER PROPOSALS

     All proposals of any shareholder of the Company which the holder desires
be presented at the next annual meeting of Shareholders and be included in the
proxy statement and form of proxy prepared for that meeting must be received by
the Company at its principal executive offices no later than January 1, 2002.
Proxies solicited by the Company for the next annual meeting of Shareholders
may confer discretionary authority to vote on any proposals submitted after
March 31, 2002 without a description of such proposals in the proxy materials
for that meeting. All such proposals must be submitted in writing to the
Secretary of the Company at the address appearing on the notice accompanying
this proxy statement.


                                   By order of the Board of Trustees,

                                   /s/ Robert Masters
                                   -------------------------
                                   Robert Masters, Secretary

                                       16
<PAGE>
                                   EXHIBIT A

                        CHARTER OF THE AUDIT COMMITTEE

Organization

     This charter governs the operations of the audit committee. The committee
shall review and reassess the charter at least annually and obtain the approval
of the board of trustees. The committee shall be appointed by the board of
trustees and shall comprise at least three trustees, each of whom are
independent of management and the Company. Members of the committee shall be
considered independence if they have no relationship that may interfere with
the exercise of their independent from management and the Company. All
committee members shall be financially literate, and at least one member shall
have accounting or related financial management expertise.

Statement of Policy

     The audit committee shall provide assistance to the board of trustees in
fulfilling their oversight responsibility to the shareholders, potential
shareholders the investment community, and others relating to the Company's
financial statements and the financial reporting process, the systems of
internal accounting and financial controls, the internal audit function, the
annual independent audit of the Company's financial statements, and the legal
compliance and ethics programs as established by management and the board. In
so doing, it is the responsibility of the committee to maintain free and open
communication between the committee, independent auditors, the internal
auditors and management of the Company. In discharging its oversight role, the
committee is empowered to investigate any matter brought to its attention with
full access to all books, records, facilities, and personnel of the Company and
the power to retain outside counsel, or other experts for this purpose.

Responsibilities and Processess

     The primary responsibility of the audit committee is to oversee the
Company's financial reporting process on behalf of the board and report the
results of their activities to the board. Management is responsible for
preparing the Company's financial statements, and the independent auditors are
responsible for auditing those financial statements. The committee in carrying
out its responsibilities believes its policies and procedures should remain
flexible, in order to best react to changing conditions and circumstances. The
committee should take the appropriate actions to set the overall corporate
"tone" for qualify financial reporting, sound business risk practices, and
ethical behavior.

     The following shall be the principal recurring processes of the audit
committee in carrying out its oversight responsibilities. The processes are set
forth as a guide with the understanding that the committee may supplement them
as appropriate.

     The committee shall have a clear understanding with management and the
     independent auditors that the independent auditors are ultimately
     accountable to the board and the audit committee, as representatives of
     the Company's shareholders. The committee shall have the ultimate
     authority and responsibility to evaluate and, where appropriate, replace
     the independent auditors. The committee shall discuss with the auditors
     their independence from a management and the Company and the matters
     included in the written disclosures required by the Independence Standards
     Board. Annually, the committee shall review and recommend to the board the
     selection of the Company's independent auditors, subject to shareholders'
     approval.

     The committee shall discuss with the internal auditors and the independent
     auditors the overall scope and plans for their respective audits including
     the adequacy of staffing and compensation. Also, the committee shall
     discuss with management, the internal auditors, and the independent
     auditors the adequacy and effectiveness of the accounting and financial
     controls, including the Company's system to monitor and manage business
     risk, and legal and ethical compliance programs. Further, the committee
     shall meet separately with the internal auditors and the independent
     auditors, with and without management present to discuss the results of
     their examinations.

                                       1
<PAGE>

     The committee shall review the interim financial statements with
     management and the independent auditors prior to the filing of the
     Company's Quarterly Report on Form 10-Q. Also, the committee shall discuss
     the results of the quarterly review and any other matters required to be
     communicated to the committee by the independent auditors under generally
     accepted auditing standards. The chair of the committee may represent the
     entire committee for the purposes of this review.

     The committee shall review with management and the independent auditors
     the financial statements to be included in the Company's Annual Report on
     Form 10-K (or the annual report to shareholders if distributed prior to
     the filing of Form 10-K), including their judgment about the quality, not
     just acceptability, of accounting principles, the reasonableness of
     significant judgments, and the clarity of the disclosures in the financial
     statements. Also, the committee shall discuss the results of the annual
     audit and any other matters required to be communicated to the committee
     by the independent auditors under generally accepted auditing standards.


                                       2
<PAGE>
                              ACADIA REALTY TRUST
                    PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
                                  MAY 31, 2001

                       This Proxy is Solicited on Behalf
                            of the Board of Trustees

         The undersigned hereby constitutes and appoints Ross Dworman, Kenneth
F. Bernstein and Robert Masters, Esq., or any one of them, as proxies, with full
power of substitution, to vote all Common Shares of beneficial interest of
Acadia Realty Trust (the "Company") which the undersigned would be entitled to
vote if personally present at the Annual Meeting of Shareholders of the Company
to be held at the offices of Credit Suisse First Boston, which are located at
277 Park Avenue, New York, NY 10172 at 10:00 o'clock a.m. local time, on May 31,
2001, or at any adjournments or postponements thereof.

               THIS PROXY IS ON BEHALF OF THE BOARD OF TRUSTEES.
                 (Continued and to be signed on reverse side.)
<TABLE>
<CAPTION>
<S>                                <C>
A [X] Please mark your
      votes as in this
      example using
      dark ink only.

                                           WITHHOLD
                      FOR                  AUTHORITY
                 all nominees       to vote for all nominees
                listed at right         listed at right
(1) TO ELECT          [ ]                    [ ]
    SEVEN
    TRUSTEES

(INSTRUCTION:  To withhold authority to vote for any
individual nominee, strike a line through the nominee's name in
the list at right.)


THE BOARD OF TRUSTEES RECOMMENDS THAT YOU VOTE "FOR" THE NOMINEES AND EACH OF THE PROPOSALS LISTED BELOW.

                                                                                                       FOR     AGAINST     ABSTAIN

Nominees: Ross Dworman                       (2) TO RATIFY THE APPOINTMENT OF ERNST &                  [ ]       [ ]         [ ]
          Kenneth F. Bernstein                   YOUNG LLP AS INDEPENDENT AUDITORS FOR THE
          Martin L. Edelman, Esq.                COMPANY FOR THE FISCAL YEAR ENDING
          Marvin J. Levine, Esq.                 DECEMBER 31, 2001.
          Lawrence J. Longua
          Gregory A. White                   (3) TO TRANSACT SUCH OTHER BUSINESS AS MAY
          Lee S. Wielansky                       PROPERLY COME BEFORE THE MEETING.





___________________________ Date  ___________________________ 2001  _________________________ Date  ___________________________ 2001
         Signature                                                  Signature if held jointly
Please sign exactly as name appears on tne certificate or certificates representing shares to be voted by this proxy, as shown
on the label above. When signing as executor, administrator, attorney, trustee, or guardian, please give full title as such. If
a corporation, please sign full corporation name by president or other authorized officer. If a partnership, please sign in
partnership name by authorized person(s).
</TABLE>

