10-Q 1 cdr-10q_20190930.htm 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2019

OR

☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER: 001-31817

CEDAR REALTY TRUST, INC.

(Exact name of registrant as specified in its charter)

Maryland | 42-1241468
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.)

44 South Bayles Avenue, Port Washington, New York 11050-3765

(Address of principal executive offices) (Zip Code)

(516) 767-6492

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class | Name of each exchange on which registered | Trading Symbol(s)
Common Stock, $0.06 par value | New York Stock Exchange | CDR
7-1/4% Series B Cumulative Redeemable Preferred Stock, $25.00 Liquidation Value | New York Stock Exchange | CDRpB
6-1/2% Series C Cumulative Redeemable Preferred Stock, $25.00 Liquidation Value | New York Stock Exchange | CDRpC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer | ☐ |  | Accelerated filer | ☒
Non-accelerated filer | ☐ |  | Smaller reporting company | ☐
Emerging growth company | ☐ |  |  |

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

At October 29, 2019, there were 89,018,754 shares of Common Stock, $0.06 par value, outstanding.

1

CEDAR REALTY TRUST, INC.

INDEX

Forward-Looking Statements | 3
Part I. Financial Information |
Item 1. |  | Financial Statements (unaudited) |
|  | Consolidated Balance Sheets – September 30, 2019 and December 31, 2018 | 4
|  | Consolidated Statements of Operations– Three and nine months ended September 30, 2019 and 2018 | 5
|  | Consolidated Statements of Comprehensive (Loss) Income – Three and nine months ended September 30, 2019 and 2018 | 6
|  | Consolidated Statements of Equity– Nine months ended September 30, 2019 and 2018 | 7-10
|  | Consolidated Statements of Cash Flows– Nine months ended September 30, 2019 and 2018 | 11
|  | Notes to Consolidated Financial Statements–September 30, 2019 | 12-21
Item 2. |  | Management’s Discussion and Analysis of Financial Condition And Results of Operations | 22-29
Item 3. |  | Quantitative and Qualitative Disclosures About Market Risk | 29
Item 4. |  | Controls and Procedures | 30
Part II. Other Information |
Item 1. |  | Legal Proceedings | 31
Item 1A. |  | Risk Factors | 31
Item 2. |  | Unregistered Sales of Equity Securities and Use of Proceeds | 31
Item 3. |  | Defaults Upon Senior Securities | 31
Item 4. |  | Mine Safety Disclosures | 31
Item 5. |  | Other Information | 31
Item 6. |  | Exhibits | 31
Signatures | 32

2

Forward-Looking Statements

Certain statements made in this Form 10-Q or incorporated by reference herein are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, as such, may involve known and unknown risks, uncertainties and other factors which may cause the Company’s actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements, which are based on certain assumptions and describe the Company’s future plans, strategies and expectations, are generally identifiable by use of the words “may”, “will”, “should”, “estimates”, “projects”, “anticipates”, “believes”, “expects”, “intends”, “future”, and words of similar import, or the negative thereof. Factors which could cause actual results to differ materially from current expectations include, but are not limited to: adverse general economic conditions in the United States and uncertainty in the credit and retail markets; financing risks, such as the inability to obtain new financing or refinancing on favorable terms as the result of market volatility or instability; risks related to the market for retail space generally, including reductions in consumer spending, variability in retailer demand for leased space, tenant bankruptcies, adverse impact of internet sales demand, ongoing consolidation in the retail sector and changes in economic conditions and consumer confidence; risks endemic to real estate and the real estate industry generally; the impact of the Company’s level of indebtedness on operating performance; inability of tenants to meet their rent and other lease obligations; adverse impact of new technology and e-commerce developments on the Company’s tenants; competitive risk; risks related to the geographic concentration of the Company’s properties in the Washington, D.C. to Boston corridor; the effects of natural and other disasters; the inability of the Company to realize anticipated returns from its redevelopment activities; and the risk factors discussed under Part I, Item 1A, “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Except for ongoing obligations to disclose material information as required by the federal securities laws, the Company undertakes no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. All of the above factors are difficult to predict, contain uncertainties that may materially affect the Company’s actual results and may be beyond the Company’s control. New factors emerge from time to time, and it is not possible for the Company’s management to predict all such factors or to assess the effects of each factor on the Company’s business. Accordingly, there can be no assurance that the Company’s current expectations will be realized.

3

CEDAR REALTY TRUST, INC.

CONSOLIDATED BALANCE SHEETS

(unaudited)

|  | September 30, |  |  | December 31, |
|  | 2019 |  |  | 2018 |
ASSETS |  |  |  |  |  |  |  |
Real estate: |  |  |  |  |  |  |  |
Land |  | $ | 296,554,000 |  |  | $ | 295,734,000 |
Buildings and improvements |  |  | 1,231,856,000 |  |  |  | 1,212,948,000 |
|  |  | 1,528,410,000 |  |  |  | 1,508,682,000 |
Less accumulated depreciation |  |  | (385,152,000 | ) |  |  | (361,969,000 | )
Real estate, net |  |  | 1,143,258,000 |  |  |  | 1,146,713,000 |
Real estate held for sale |  |  | 7,225,000 |  |  |  | 11,592,000 |
Cash and cash equivalents |  |  | 1,983,000 |  |  |  | 1,977,000 |
Receivables |  |  | 23,810,000 |  |  |  | 21,977,000 |
Other assets and deferred charges, net |  |  | 46,509,000 |  |  |  | 40,642,000 |
TOTAL ASSETS |  | $ | 1,222,785,000 |  |  | $ | 1,222,901,000 |
LIABILITIES AND EQUITY |  |  |  |  |  |  |  |
Mortgage loan payable |  | $ | 46,609,000 |  |  | $ | 47,315,000 |
Capital lease obligation |  |  | 5,370,000 |  |  |  | 5,387,000 |
Unsecured revolving credit facility |  |  | 107,000,000 |  |  |  | 100,000,000 |
Unsecured term loans |  |  | 472,663,000 |  |  |  | 472,132,000 |
Accounts payable and accrued liabilities |  |  | 52,829,000 |  |  |  | 26,142,000 |
Unamortized intangible lease liabilities |  |  | 11,139,000 |  |  |  | 13,209,000 |
Total liabilities |  |  | 695,610,000 |  |  |  | 664,185,000 |
Commitments and contingencies |  |  | - |  |  |  | - |
Equity: |  |  |  |  |  |  |  |
Cedar Realty Trust, Inc. shareholders' equity: |  |  |  |  |  |  |  |
Preferred stock |  |  | 159,541,000 |  |  |  | 159,541,000 |
Common stock ($0.06 par value, 150,000,000 shares authorized, 89,021,000 and 90,436,000 shares, issued and outstanding, respectively) |  |  | 5,341,000 |  |  |  | 5,426,000 |
Treasury stock (3,077,000 and 2,971,000 shares, respectively, at cost) |  |  | (16,391,000 | ) |  |  | (16,572,000 | )
Additional paid-in capital |  |  | 871,682,000 |  |  |  | 875,565,000 |
Cumulative distributions in excess of net income |  |  | (486,617,000 | ) |  |  | (475,726,000 | )
Accumulated other comprehensive (loss) income |  |  | (9,842,000 | ) |  |  | 7,191,000 |
Total Cedar Realty Trust, Inc. shareholders' equity |  |  | 523,714,000 |  |  |  | 555,425,000 |
Noncontrolling interests: |  |  |  |  |  |  |  |
Minority interests in consolidated joint ventures |  |  | 303,000 |  |  |  | (112,000 | )
Limited partners' OP Units |  |  | 3,158,000 |  |  |  | 3,403,000 |
Total noncontrolling interests |  |  | 3,461,000 |  |  |  | 3,291,000 |
Total equity |  |  | 527,175,000 |  |  |  | 558,716,000 |
TOTAL LIABILITIES AND EQUITY |  | $ | 1,222,785,000 |  |  | $ | 1,222,901,000 |

See accompanying notes to consolidated financial statements

4

CEDAR REALTY TRUST, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
REVENUES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Rental revenues |  | $ | 35,490,000 |  |  | $ | 35,867,000 |  |  | $ | 107,391,000 |  |  | $ | 110,532,000 |
Other |  |  | 422,000 |  |  |  | 303,000 |  |  |  | 1,064,000 |  |  |  | 4,556,000 |
Total revenues |  |  | 35,912,000 |  |  |  | 36,170,000 |  |  |  | 108,455,000 |  |  |  | 115,088,000 |
EXPENSES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Operating, maintenance and management |  |  | 6,321,000 |  |  |  | 6,394,000 |  |  |  | 20,450,000 |  |  |  | 20,182,000 |
Real estate and other property-related taxes |  |  | 5,178,000 |  |  |  | 5,037,000 |  |  |  | 15,475,000 |  |  |  | 15,172,000 |
General and administrative |  |  | 4,886,000 |  |  |  | 3,975,000 |  |  |  | 15,102,000 |  |  |  | 12,745,000 |
Depreciation and amortization |  |  | 10,547,000 |  |  |  | 9,650,000 |  |  |  | 31,022,000 |  |  |  | 30,245,000 |
Total expenses |  |  | 26,932,000 |  |  |  | 25,056,000 |  |  |  | 82,049,000 |  |  |  | 78,344,000 |
OTHER |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Gain on sales |  |  | - |  |  |  | 4,864,000 |  |  |  | 2,942,000 |  |  |  | 4,864,000 |
Impairment reversal/(charges) |  |  | - |  |  |  | 707,000 |  |  |  | - |  |  |  | (20,689,000 | )
Total other |  |  | - |  |  |  | 5,571,000 |  |  |  | 2,942,000 |  |  |  | (15,825,000 | )
OPERATING INCOME |  |  | 8,980,000 |  |  |  | 16,685,000 |  |  |  | 29,348,000 |  |  |  | 20,919,000 |
NON-OPERATING INCOME AND EXPENSES |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest expense |  |  | (6,033,000 | ) |  |  | (5,551,000 | ) |  |  | (17,868,000 | ) |  |  | (16,468,000 | )
Early extinguishment of debt costs |  |  | - |  |  |  | (4,829,000 | ) |  |  | - |  |  |  | (4,829,000 | )
Total non-operating income and expenses |  |  | (6,033,000 | ) |  |  | (10,380,000 | ) |  |  | (17,868,000 | ) |  |  | (21,297,000 | )
NET INCOME (LOSS) |  |  | 2,947,000 |  |  |  | 6,305,000 |  |  |  | 11,480,000 |  |  |  | (378,000 | )
Net (income) loss attributable to noncontrolling interests: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Minority interests in consolidated joint ventures |  |  | (166,000 | ) |  |  | (126,000 | ) |  |  | (415,000 | ) |  |  | (394,000 | )
Limited partners' interest in Operating Partnership |  |  | (1,000 | ) |  |  | (19,000 | ) |  |  | (20,000 | ) |  |  | 41,000 |
Total net (income) attributable to noncontrolling interests |  |  | (167,000 | ) |  |  | (145,000 | ) |  |  | (435,000 | ) |  |  | (353,000 | )
NET INCOME (LOSS) ATTRIBUTABLE TO CEDAR REALTY TRUST, INC. |  |  | 2,780,000 |  |  |  | 6,160,000 |  |  |  | 11,045,000 |  |  |  | (731,000 | )
Preferred stock dividends |  |  | (2,688,000 | ) |  |  | (2,688,000 | ) |  |  | (8,064,000 | ) |  |  | (8,175,000 | )
Preferred stock redemption costs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (3,507,000 | )
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS |  | $ | 92,000 |  |  | $ | 3,472,000 |  |  | $ | 2,981,000 |  |  | $ | (12,413,000 | )
NET (LOSS) INCOME PER COMMON SHARE ATTRIBUTABLE TO COMMON SHAREHOLDERS: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  | $ | (0.00 | ) |  | $ | 0.04 |  |  | $ | 0.03 |  |  | $ | (0.15 | )
Diluted |  | $ | (0.00 | ) |  | $ | 0.04 |  |  | $ | 0.03 |  |  | $ | (0.15 | )
Weighted average number of common shares: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  |  | 86,262,000 |  |  |  | 89,049,000 |  |  |  | 86,367,000 |  |  |  | 88,228,000 |
Diluted |  |  | 86,262,000 |  |  |  | 89,875,000 |  |  |  | 86,367,000 |  |  |  | 88,228,000 |

See accompanying notes to consolidated financial statements

5

CEDAR REALTY TRUST, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(unaudited)

|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Net income (loss) |  | $ | 2,947,000 |  |  | $ | 6,305,000 |  |  | $ | 11,480,000 |  |  | $ | (378,000 | )
Other comprehensive income - unrealized (loss) gain on change in fair value of cash flow hedges |  |  | (3,099,000 | ) |  |  | 2,129,000 |  |  |  | (17,137,000 | ) |  |  | 9,956,000 |
Comprehensive (loss) income |  |  | (152,000 | ) |  |  | 8,434,000 |  |  |  | (5,657,000 | ) |  |  | 9,578,000 |
Comprehensive (income) attributable to noncontrolling interests |  |  | (149,000 | ) |  |  | (174,000 | ) |  |  | (331,000 | ) |  |  | (411,000 | )
Comprehensive (loss) income attributable to Cedar Realty Trust, Inc. |  | $ | (301,000 | ) |  | $ | 8,260,000 |  |  | $ | (5,988,000 | ) |  | $ | 9,167,000 |

See accompanying notes to consolidated financial statements

6

CEDAR REALTY TRUST, INC.

Consolidated Statement of Equity

Nine months ended September 30, 2019

(unaudited)

|  | Cedar Realty Trust, Inc. Shareholders |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Cumulative |  |  | Accumulated |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Treasury |  |  | Additional |  |  | distributions |  |  | other |  |  |  |  |
|  | Preferred stock |  |  | Common stock |  |  | stock, |  |  | paid-in |  |  | in excess of |  |  | comprehensive |  |  |  |  |
|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | at cost |  |  | capital |  |  | net income |  |  | income |  |  | Total |
Balance, December 31, 2018 |  |  | 6,450,000 |  |  | $ | 159,541,000 |  |  |  | 90,436,000 |  |  | $ | 5,426,000 |  |  | $ | (16,572,000 | ) |  | $ | 875,565,000 |  |  | $ | (475,726,000 | ) |  | $ | 7,191,000 |  |  | $ | 555,425,000 |
Prior period adjustment - adoption of lease accounting standard |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (515,000 | ) |  |  | — |  |  |  | (515,000 | )
Balance, December 31, 2018, restated |  |  | 6,450,000 |  |  |  | 159,541,000 |  |  |  | 90,436,000 |  |  |  | 5,426,000 |  |  |  | (16,572,000 | ) |  |  | 875,565,000 |  |  |  | (476,241,000 | ) |  |  | 7,191,000 |  |  |  | 554,910,000 |
Net income |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 2,882,000 |  |  |  | — |  |  |  | 2,882,000 |
Unrealized (loss) on change in fair value of cash flow hedges |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (5,409,000 | ) |  |  | (5,409,000 | )
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | 650,000 |  |  |  | 39,000 |  |  |  | 22,000 |  |  |  | 692,000 |  |  |  | — |  |  |  | — |  |  |  | 753,000 |
Common stock sales, net of issuance expenses |  |  | — |  |  |  | — |  |  |  | 1,000 |  |  |  | — |  |  |  | — |  |  |  | 5,000 |  |  |  | — |  |  |  | — |  |  |  | 5,000 |
Common stock repurchases |  |  | — |  |  |  | — |  |  |  | (2,050,000 | ) |  |  | (123,000 | ) |  |  | — |  |  |  | (6,721,000 | ) |  |  | — |  |  |  | — |  |  |  | (6,844,000 | )
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | ) |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (4,455,000 | ) |  |  | — |  |  |  | (4,455,000 | )
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (12,000 | ) |  |  | — |  |  |  | — |  |  |  | (12,000 | )
Balance, March 31, 2019 |  |  | 6,450,000 |  |  |  | 159,541,000 |  |  |  | 89,037,000 |  |  |  | 5,342,000 |  |  |  | (16,550,000 | ) |  |  | 869,529,000 |  |  |  | (480,502,000 | ) |  |  | 1,782,000 |  |  |  | 539,142,000 |
Net income |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 5,383,000 |  |  |  | — |  |  |  | 5,383,000 |
Unrealized (loss) on change in fair value of cash flow hedges |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (8,543,000 | ) |  |  | (8,543,000 | )
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | (13,000 | ) |  |  | (1,000 | ) |  |  | 80,000 |  |  |  | 1,053,000 |  |  |  | — |  |  |  | — |  |  |  | 1,132,000 |
Common stock sales, net of issuance expenses |  |  | — |  |  |  | — |  |  |  | 1,000 |  |  |  | — |  |  |  | — |  |  |  | 3,000 |  |  |  | — |  |  |  | — |  |  |  | 3,000 |
Common stock repurchases |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | ) |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (4,451,000 | ) |  |  | — |  |  |  | (4,451,000 | )
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (3,000 | ) |  |  | — |  |  |  | — |  |  |  | (3,000 | )
Balance, June 30, 2019 |  |  | 6,450,000 |  |  |  | 159,541,000 |  |  |  | 89,025,000 |  |  |  | 5,341,000 |  |  |  | (16,470,000 | ) |  |  | 870,582,000 |  |  |  | (482,258,000 | ) |  |  | (6,761,000 | ) |  |  | 529,975,000 |
Net income |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 2,780,000 |  |  |  | — |  |  |  | 2,780,000 |
Unrealized (loss) on change in fair value of cash flow hedges |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (3,081,000 | ) |  |  | (3,081,000 | )
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | (9,000 | ) |  |  | — |  |  |  | 79,000 |  |  |  | 1,041,000 |  |  |  | — |  |  |  | — |  |  |  | 1,120,000 |
Common stock sales, net of issuance expenses |  |  | — |  |  |  | — |  |  |  | 5,000 |  |  |  | — |  |  |  | — |  |  |  | 10,000 |  |  |  | — |  |  |  | — |  |  |  | 10,000 |
Common stock repurchases |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | ) |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (4,451,000 | ) |  |  | — |  |  |  | (4,451,000 | )
Redemption of OP Units |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 49,000 |  |  |  | — |  |  |  | — |  |  |  | 49,000 |
Balance, September 30, 2019 |  |  | 6,450,000 |  |  | $ | 159,541,000 |  |  |  | 89,021,000 |  |  | $ | 5,341,000 |  |  | $ | (16,391,000 | ) |  | $ | 871,682,000 |  |  | $ | (486,617,000 | ) |  | $ | (9,842,000 | ) |  | $ | 523,714,000 |

7

CEDAR REALTY TRUST, INC.

Consolidated Statement of Equity

Nine months ended September 30, 2019

Continued

(unaudited)

|  | Noncontrolling Interests |  |  |  |  |
|  | Minority |  |  | Limited |  |  |  |  |  |  |  |  |
|  | interest in |  |  | partners' |  |  |  |  |  |  |  |  |
|  | consolidated |  |  | interest in |  |  |  |  |  |  |  |  |
|  | joint |  |  | Operating |  |  |  |  |  |  | Total |
|  | ventures |  |  | Partnership |  |  | Total |  |  | Equity |
Balance, December 31, 2018 |  | $ | (112,000 | ) |  | $ | 3,403,000 |  |  | $ | 3,291,000 |  |  | $ | 558,716,000 |
Prior period adjustment - adoption of lease accounting standard |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (515,000 | )
Balance, December 31, 2018, restated |  |  | (112,000 | ) |  |  | 3,403,000 |  |  |  | 3,291,000 |  |  |  | 558,201,000 |
Net income |  |  | 105,000 |  |  |  | 2,000 |  |  |  | 107,000 |  |  |  | 2,989,000 |
Unrealized (loss) on change in fair value of cash flow hedges |  |  | — |  |  |  | (33,000 | ) |  |  | (33,000 | ) |  |  | (5,442,000 | )
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 753,000 |
Common stock sales, net of issuance expenses |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 5,000 |
Common stock repurchases |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (6,844,000 | )
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | (28,000 | ) |  |  | (28,000 | ) |  |  | (4,483,000 | )
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | 12,000 |  |  |  | 12,000 |  |  |  | — |
Balance, March 31, 2019 |  |  | (7,000 | ) |  |  | 3,356,000 |  |  |  | 3,349,000 |  |  |  | 542,491,000 |
Net income |  |  | 144,000 |  |  |  | 17,000 |  |  |  | 161,000 |  |  |  | 5,544,000 |
Unrealized (loss) on change in fair value of cash flow hedges |  |  | — |  |  |  | (53,000 | ) |  |  | (53,000 | ) |  |  | (8,596,000 | )
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,132,000 |
Common stock sales, net of issuance expenses |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 3,000 |
Common stock repurchases |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | (28,000 | ) |  |  | (28,000 | ) |  |  | (4,479,000 | )
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | 3,000 |  |  |  | 3,000 |  |  |  | — |
Balance, June 30, 2019 |  |  | 137,000 |  |  |  | 3,295,000 |  |  |  | 3,432,000 |  |  |  | 533,407,000 |
Net income |  |  | 166,000 |  |  |  | 1,000 |  |  |  | 167,000 |  |  |  | 2,947,000 |
Unrealized (loss) on change in fair value of cash flow hedges |  |  | — |  |  |  | (18,000 | ) |  |  | (18,000 | ) |  |  | (3,099,000 | )
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,120,000 |
Common stock sales, net of issuance expenses |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 10,000 |
Common stock repurchases |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | (28,000 | ) |  |  | (28,000 | ) |  |  | (4,479,000 | )
Redemption of OP Units |  |  | — |  |  |  | (43,000 | ) |  |  | (43,000 | ) |  |  | (43,000 | )
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | (49,000 | ) |  |  | (49,000 | ) |  |  | — |
Balance, September 30, 2019 |  | $ | 303,000 |  |  | $ | 3,158,000 |  |  | $ | 3,461,000 |  |  | $ | 527,175,000 |

See accompanying notes to consolidated financial statements

8

CEDAR REALTY TRUST, INC.

Consolidated Statement of Equity

Nine months ended September 30, 2018

(unaudited)

|  | Cedar Realty Trust, Inc. Shareholders |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Cumulative |  |  | Accumulated |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Treasury |  |  | Additional |  |  | distributions |  |  | other |  |  |  |  |
|  | Preferred stock |  |  | Common stock |  |  | stock, |  |  | paid-in |  |  | in excess of |  |  | comprehensive |  |  |  |  |
|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | at cost |  |  | capital |  |  | net income |  |  | income |  |  | Total |
Balance, December 31, 2017 |  |  | 8,450,000 |  |  | $ | 207,508,000 |  |  |  | 91,317,000 |  |  | $ | 5,479,000 |  |  | $ | (18,463,000 | ) |  | $ | 875,062,000 |  |  | $ | (446,944,000 | ) |  | $ | 5,694,000 |  |  | $ | 628,336,000 |
Net (loss) income |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (16,668,000 | ) |  |  | — |  |  |  | (16,668,000 | )
Unrealized gain on change in fair value of cash flow hedges |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 5,868,000 |  |  |  | 5,868,000 |
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | 393,000 |  |  |  | 24,000 |  |  |  | 5,000 |  |  |  | 222,000 |  |  |  | — |  |  |  | — |  |  |  | 251,000 |
Redemptions of Series B Shares |  |  | (2,000,000 | ) |  |  | (47,967,000 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,458,000 |  |  |  | (3,507,000 | ) |  |  | — |  |  |  | (50,016,000 | )
Common stock sales, net of issuance expenses |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,000 |  |  |  | — |  |  |  | — |  |  |  | 1,000 |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,799,000 | ) |  |  | — |  |  |  | (2,799,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (4,595,000 | ) |  |  | — |  |  |  | (4,595,000 | )
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 184,000 |  |  |  | — |  |  |  | — |  |  |  | 184,000 |
Balance, March 31, 2018 |  |  | 6,450,000 |  |  |  | 159,541,000 |  |  |  | 91,710,000 |  |  |  | 5,503,000 |  |  |  | (18,458,000 | ) |  |  | 876,927,000 |  |  |  | (474,513,000 | ) |  |  | 11,562,000 |  |  |  | 560,562,000 |
Net income |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 9,777,000 |  |  |  | — |  |  |  | 9,777,000 |
Unrealized gain on change in fair value of cash flow hedges |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,930,000 |  |  |  | 1,930,000 |
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | (496,000 | ) |  |  | (30,000 | ) |  |  | 1,729,000 |  |  |  | (737,000 | ) |  |  | — |  |  |  | — |  |  |  | 962,000 |
Common stock sales, net of issuance expenses |  |  | — |  |  |  | — |  |  |  | 1,000 |  |  |  | — |  |  |  | — |  |  |  | 4,000 |  |  |  | — |  |  |  | — |  |  |  | 4,000 |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | ) |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (4,585,000 | ) |  |  | — |  |  |  | (4,585,000 | )
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (15,000 | ) |  |  | — |  |  |  | — |  |  |  | (15,000 | )
Balance, June 30, 2018 |  |  | 6,450,000 |  |  |  | 159,541,000 |  |  |  | 91,215,000 |  |  |  | 5,473,000 |  |  |  | (16,729,000 | ) |  |  | 876,179,000 |  |  |  | (472,009,000 | ) |  |  | 13,492,000 |  |  |  | 565,947,000 |
Net income |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 6,160,000 |  |  |  | — |  |  |  | 6,160,000 |
Unrealized gain on change in fair value of cash flow hedges |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 2,100,000 |  |  |  | 2,100,000 |
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | (5,000 | ) |  |  | — |  |  |  | 79,000 |  |  |  | 994,000 |  |  |  | — |  |  |  | — |  |  |  | 1,073,000 |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | 1,000 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | ) |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (4,561,000 | ) |  |  | — |  |  |  | (4,561,000 | )
Redemption of OP Units |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Issuance of OP Units |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (308,000 | ) |  |  | — |  |  |  | — |  |  |  | (308,000 | )
Balance, September 30, 2018 |  |  | 6,450,000 |  |  | $ | 159,541,000 |  |  |  | 91,211,000 |  |  | $ | 5,473,000 |  |  | $ | (16,650,000 | ) |  | $ | 876,865,000 |  |  | $ | (473,098,000 | ) |  | $ | 15,592,000 |  |  | $ | 567,723,000 |

9

CEDAR REALTY TRUST, INC.

Consolidated Statement of Equity

Nine months ended September 30, 2018

Continued

(unaudited)

|  | Noncontrolling Interests |  |  |  |  |
|  | Minority |  |  | Limited |  |  |  |  |  |  |  |  |
|  | interest in |  |  | partners' |  |  |  |  |  |  |  |  |
|  | consolidated |  |  | interest in |  |  |  |  |  |  |  |  |
|  | joint |  |  | Operating |  |  |  |  |  |  | Total |
|  | ventures |  |  | Partnership |  |  | Total |  |  | Equity |
Balance, December 31, 2017 |  | $ | (609,000 | ) |  | $ | 2,384,000 |  |  | $ | 1,775,000 |  |  | $ | 630,111,000 |
Net (loss) income |  |  | 135,000 |  |  |  | (87,000 | ) |  |  | 48,000 |  |  |  | (16,620,000 | )
Unrealized gain on change in fair value of cash flow hedges |  |  | — |  |  |  | 22,000 |  |  |  | 22,000 |  |  |  | 5,890,000 |
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 251,000 |
Redemptions of Series B Shares |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (50,016,000 | )
Common stock sales, net of issuance expenses |  |  |  |  |  |  |  |  |  |  | — |  |  |  | 1,000 |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,799,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | (17,000 | ) |  |  | (17,000 | ) |  |  | (4,612,000 | )
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | (184,000 | ) |  |  | (184,000 | ) |  |  | — |
Balance, March 31, 2018 |  |  | (474,000 | ) |  |  | 2,118,000 |  |  |  | 1,644,000 |  |  |  | 562,206,000 |
Net income |  |  | 133,000 |  |  |  | 27,000 |  |  |  | 160,000 |  |  |  | 9,937,000 |
Unrealized gain on change in fair value of cash flow hedges |  |  | — |  |  |  | 7,000 |  |  |  | 7,000 |  |  |  | 1,937,000 |
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 962,000 |
Common stock sales, net of issuance expenses |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 4,000 |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | (17,000 | ) |  |  | (17,000 | ) |  |  | (4,602,000 | )
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | 15,000 |  |  |  | 15,000 |  |  |  | — |
Balance, June 30, 2018 |  |  | (341,000 | ) |  |  | 2,150,000 |  |  |  | 1,809,000 |  |  |  | 567,756,000 |
Net income |  |  | 126,000 |  |  |  | 19,000 |  |  |  | 145,000 |  |  |  | 6,305,000 |
Unrealized gain on change in fair value of cash flow hedges |  |  | — |  |  |  | 29,000 |  |  |  | 29,000 |  |  |  | 2,129,000 |
Share-based compensation, net |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,073,000 |
Preferred stock dividends |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (2,688,000 | )
Distributions to common shareholders/noncontrolling interests |  |  | — |  |  |  | (28,000 | ) |  |  | (28,000 | ) |  |  | (4,589,000 | )
Redemption of OP Units |  |  | — |  |  |  | (7,000 | ) |  |  | (7,000 | ) |  |  | (7,000 | )
Issuance of OP Units |  |  | — |  |  |  | 975,000 |  |  |  | 975,000 |  |  |  | 975,000 |
Reallocation adjustment of limited partners' interest |  |  | — |  |  |  | 308,000 |  |  |  | 308,000 |  |  |  | — |
Balance, September 30, 2018 |  | $ | (215,000 | ) |  | $ | 3,446,000 |  |  | $ | 3,231,000 |  |  | $ | 570,954,000 |

See accompanying notes to consolidated financial statements

10

CEDAR REALTY TRUST, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

|  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |
OPERATING ACTIVITIES |  |  |  |  |  |  |  |
Net income (loss) |  | $ | 11,480,000 |  |  | $ | (378,000 | )
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |  |  |  |  |  |  |  |
Gain on sales |  |  | (2,942,000 | ) |  |  | (4,864,000 | )
Impairment charges |  |  | — |  |  |  | 20,689,000 |
Early extinguishment of debt costs |  |  | — |  |  |  | 4,829,000 |
Straight-line rents and expenses, net |  |  | (298,000 | ) |  |  | (824,000 | )
Provision for doubtful accounts |  |  | 233,000 |  |  |  | 1,662,000 |
Depreciation and amortization |  |  | 31,022,000 |  |  |  | 30,245,000 |
Amortization of intangible lease liabilities, net |  |  | (2,212,000 | ) |  |  | (3,611,000 | )
Expense relating to share-based compensation, net |  |  | 3,078,000 |  |  |  | 2,801,000 |
Amortization of premium on mortgage loan payable |  |  | — |  |  |  | (80,000 | )
Amortization of deferred financing costs |  |  | 967,000 |  |  |  | 913,000 |
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions: |  |  |  |  |  |  |  |
Rents and other receivables |  |  | (2,068,000 | ) |  |  | (3,524,000 | )
Prepaid expenses and other |  |  | (5,788,000 | ) |  |  | (9,207,000 | )
Accounts payable and accrued liabilities |  |  | 2,922,000 |  |  |  | 1,326,000 |
Net cash provided by operating activities |  |  | 36,394,000 |  |  |  | 39,977,000 |
INVESTING ACTIVITIES |  |  |  |  |  |  |  |
Acquisition of real estate |  |  | (9,083,000 | ) |  |  | (179,000 | )
Expenditures for real estate improvements |  |  | (23,816,000 | ) |  |  | (21,919,000 | )
Net proceeds from sales of real estate |  |  | 18,651,000 |  |  |  | 19,118,000 |
Issuance of mortgage note receivable |  |  | — |  |  |  | (3,500,000 | )
Net cash (used in) investing activities |  |  | (14,248,000 | ) |  |  | (6,480,000 | )
FINANCING ACTIVITIES |  |  |  |  |  |  |  |
Repayments under revolving credit facility |  |  | (16,000,000 | ) |  |  | (117,500,000 | )
Advances under revolving credit facility |  |  | 23,000,000 |  |  |  | 164,500,000 |
Advance under term loan |  |  | — |  |  |  | 75,000,000 |
Mortgage repayments |  |  | (766,000 | ) |  |  | (80,077,000 | )
Payment of early extinguishment of debt costs |  |  | — |  |  |  | (5,159,000 | )
Payments of debt financing costs |  |  | — |  |  |  | (677,000 | )
Noncontrolling interests: |  |  |  |  |  |  |  |
Distributions to limited partners |  |  | (84,000 | ) |  |  | (62,000 | )
Redemption of OP Units |  |  | (43,000 | ) |  |  | (7,000 | )
Redemptions of preferred stock |  |  | — |  |  |  | (50,016,000 | )
Common stock sales less issuance expenses, net |  |  | 18,000 |  |  |  | 9,000 |
Common stock repurchases |  |  | (6,844,000 | ) |  |  | — |
Preferred stock dividends |  |  | (8,064,000 | ) |  |  | (8,588,000 | )
Distributions to common shareholders |  |  | (13,357,000 | ) |  |  | (13,741,000 | )
Net cash (used in) financing activities |  |  | (22,140,000 | ) |  |  | (36,318,000 | )
Net increase (decrease) in cash, cash equivalents and restricted cash |  |  | 6,000 |  |  |  | (2,821,000 | )
Cash, cash equivalents and restricted cash at beginning of year |  |  | 1,977,000 |  |  |  | 7,219,000 |
Cash, cash equivalents and restricted cash at end of period |  | $ | 1,983,000 |  |  | $ | 4,398,000 |
Reconciliation to consolidated balance sheets: |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 1,983,000 |  |  | $ | 4,398,000 |
Restricted cash |  |  | — |  |  |  | — |
Cash, cash equivalents and restricted cash |  | $ | 1,983,000 |  |  | $ | 4,398,000 |

See accompanying notes to consolidated financial statements

11

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

Note 1. Business and Organization

Cedar Realty Trust, Inc. (the “Company”) is a real estate investment trust (“REIT”) that focuses primarily on ownership, operation and redevelopment of grocery-anchored shopping centers in high-density urban markets from Washington, D.C. to Boston. At September 30, 2019, the Company owned and managed a portfolio of 57 operating properties (excluding properties “held for sale”).

Cedar Realty Trust Partnership, L.P. (the “Operating Partnership”) is the entity through which the Company conducts substantially all of its business and owns (either directly or through subsidiaries) substantially all of its assets. At September 30, 2019, the Company owned a 99.4% general and limited partnership interest in, and was the sole general partner of, the Operating Partnership. The limited partners’ interest in the Operating Partnership (0.6% at September 30, 2019) is represented by Operating Partnership Units (“OP Units”). The carrying amount of such interest is adjusted at the end of each reporting period to an amount equal to the limited partners’ ownership percentage of the Operating Partnership’s net equity. The 537,000 OP Units outstanding at September 30, 2019 are economically equivalent to shares of the Company’s common stock. The holders of OP Units have the right to exchange their OP Units for the same number of shares of the Company’s common stock or, at the Company’s option, for cash. Unless specifically noted otherwise, all references to OP Units exclude limited partnership units held by the Company.

As used herein, the “Company” refers to Cedar Realty Trust, Inc. and its subsidiaries on a consolidated basis, including the Operating Partnership or, where the context so requires, Cedar Realty Trust, Inc. only.

Note 2. Summary of Significant Accounting Policies

Principles of Consolidation/Basis of Preparation

The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and include all of the information and disclosures required by U.S. Generally Accepted Accounting Principles (“GAAP”) for interim reporting. Accordingly, they do not include all of the disclosures required by GAAP for complete financial statement disclosures. In the opinion of management, all adjustments necessary for fair presentation (including normal recurring accruals) have been included. The financial statements are prepared on the accrual basis in accordance with GAAP, which requires management to make estimates and assumptions that affect the disclosure of contingent assets and liabilities, the reported amounts of assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the periods covered by the financial statements. Actual results could differ from these estimates. The unaudited consolidated financial statements in this Form 10-Q should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

The unaudited consolidated financial statements include the accounts and operations of the Company, the Operating Partnership, its subsidiaries, and certain joint venture partnerships in which it participates. The Company consolidates all variable interest entities for which it is the primary beneficiary.

Supplemental Consolidated Statements of Cash Flows Information

|  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |
Supplemental disclosure of cash activities: |  |  |  |  |  |  |  |
Cash paid for interest |  | $ | 17,907,000 |  |  | $ | 16,593,000 |
Supplemental disclosure of non-cash activities: |  |  |  |  |  |  |  |
Capitalization of interest and financing costs |  |  | 1,187,000 |  |  |  | 1,125,000 |
Recognition of right-of-use assets and related lease liabilities |  |  | 13,992,000 |  |  |  | — |
Issuance of OP Units in connection with a land parcel acquisition |  |  | — |  |  |  | 975,000 |

12

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

Recently-Adopted Accounting Pronouncements

In February 2016, the FASB issued guidance amending the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. The guidance, effective for annual and interim reporting periods beginning on or after December 15, 2018, requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. The Company is not required to reassess the classification of existing ground leases where it is the lessee and therefore these leases will continue to be accounted for as operating leases. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than twelve months regardless of their classification. Leases with a term of twelve months or less continue to be accounted for pursuant to existing guidance for operating leases. Based on the Company’s future obligations under its ground lease and executive office lease agreements for which the Company is the lessee, the newly adopted guidance resulted in the recognition of (1) right-of-use assets of $14.6 million included in other assets and deferred charges, net, and (2) right-of-use liabilities of $14.6 million included in accounts payable and accrued liabilities, on the Company’s consolidated balance sheet as of January 1, 2019. In the event the Company modifies existing ground leases or enters into new ground leases after adoption of the new standard, such leases may be classified as finance leases. Additionally, the guidance requires that lessees and lessors capitalize, as initial direct costs, only those costs that are incurred due to the execution of a lease. Under this guidance, allocated payroll costs and other costs that are incurred regardless of whether the lease is obtained will no longer be capitalized as initial direct costs and instead will be expensed as incurred. During the three and nine months ended September 30, 2019, the Company expensed $0.7 million and $2.1 million, respectively, of leasing costs which would have previously been capitalized.

The FASB provided lessors with a practical expedient, elected by class of underlying asset, to account for lease and non-lease components as a single lease component if certain criteria are met. Lessors that make these elections are required to provide additional disclosures. The FASB provided an additional (and optional) transition method that allows entities to initially apply the guidance at the adoption date (January 1, 2019) and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company applied both these practical expedients upon adoption. The practical expedient allowed the Company to not separate expenses reimbursed by customers from the associated rental revenue if certain criteria were met. The Company assessed these criteria and concluded that the timing and pattern of transfer for rental revenue and the associated rental expense recoveries are the same and, as the leases qualify as operating leases, the Company accounted for and presented rents and expense recoveries as a single component under rental revenues in the consolidated statement of operations for the three and nine months ended September 30, 2019. As a result of the adoption of this practical expedient, the Company also presented $28.1 million and $85.7 million of rents and $7.7 million and $24.8 million of expense recoveries as single components in the consolidated statement of operations for the three and nine months ended September 30, 2018, respectively, to conform to the new 2019 presentation.

In November 2018, the FASB clarified the existing accounting treatment relating to receivables arising from operating leases, stating that such receivables are not within the scope of the expected credit loss standard and that impairment of receivables arising from operating leases should be accounted for in accordance with the recently-adopted lease accounting standard. This required the Company to review its existing lease portfolio to determine if all future lease payments are probable of collection and, if the Company determined that all future lease payments are not probable of collection, the Company will account for these leases on a cash basis. This required that all amounts that were historically recorded as bad debt expense, and previously included in operating expenses in the Company’s consolidated statement of operations, now be recorded as a direct reduction of rental revenues. As permitted by the standard upon adoption, the Company recorded a $0.5 million prior-period adjustment to opening equity which the Company has reflected in the consolidated statement of equity for the nine months ended September 30, 2019.

13

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

Note 3. Real Estate

Acquisition

On June 19, 2019, the Company purchased Girard Plaza, a shopping center adjacent to its South Philadelphia property, located in Philadelphia, Pennsylvania. The purchase price for the property was $8.5 million, which has been allocated to real estate assets and liabilities.

Dispositions

On February 15, 2019, the Company sold Maxatawny Marketplace, located in Maxatawny, Pennsylvania. The sales price for the property was $10.3 million, which resulted in a gain on sale of $0.1 million, which has been included in continuing operations in the accompanying consolidated statement of operations.

On June 26, 2019, the Company sold Fort Washington Center, located in Fort Washington, Pennsylvania. The sales price for the property was $9.0 million, which resulted in a gain on sale of $2.8 million, which has been included in continuing operations in the accompanying consolidated statement of operations.

Real Estate Held for Sale

As of September 30, 2019, Carll’s Corner, located in Bridgeton, New Jersey, and Suffolk Plaza, located in Suffolk, Virginia, have been classified as “real estate held for sale” on the accompanying consolidated balance sheet.

The Company, when applicable, conducts a continuing review of the values for all properties “held for sale” based on final sales prices and sales contracts entered into. Impairment charges/reversals, if applicable, are based on a comparison of the carrying values of the properties with either (1) actual sales prices less costs to sell for properties sold, or contract amounts for properties in the process of being sold, (2) estimated sales prices, less costs to sell, based on discounted cash flow or income capitalization analyses, if no contract amounts are being negotiated (see Note 4 - “Fair Value Measurements”), or (3) with respect to land parcels, estimated sales prices, less costs to sell, based on comparable sales completed in the selected market areas. Prior to the Company’s determination to dispose of properties, which are subsequently reclassified to “held for sale”, the Company performed recoverability analyses based on the estimated undiscounted cash flows that were expected to result from the real estate investments’ use and eventual disposal. The projected undiscounted cash flows of each property reflects that the carrying value of each real estate investment would be recovered. However, as a result of the properties’ meeting the “held for sale” criteria, such properties were written down to the lower of their carrying value and estimated fair values less costs to sell.

Note 4. Fair Value Measurements

The carrying amounts of cash and cash equivalents, restricted cash, rents and other receivables, certain other assets, accounts payable and accrued liabilities, and variable-rate debt approximate their fair value due to their terms and/or short-term nature. The fair value of the Company’s investments and liabilities related to share-based compensation were determined to be Level 1 within the valuation hierarchy, and were based on independent values provided by financial institutions.

The fair value of the Company’s fixed rate mortgage loan was estimated using available market information and discounted cash flow analyses based on borrowing rates the Company believes it could obtain with a similar term and maturity. As of September 30, 2019 and December 31, 2018, the fair value of the Company’s fixed rate mortgage loan payable, which was determined to be Level 3 within the valuation hierarchy, was $46.6 million and $44.4 million, respectively; the carrying value of such loan was $46.6 million and $47.3 million, respectively. As of September 30, 2019 and December 31, 2018, respectively, the aggregate fair values of the Company’s unsecured revolving credit facility and term loans approximated the carrying values. In addition, the fair value of the Company’s mortgage note receivable and capital lease obligation, which were determined to be Level 3 within the valuation hierarchy, approximated their carrying values as of September 30, 2019 and December 31, 2018, respectively.

The valuations of the assets and liabilities for the Company’s interest rate swaps, which are measured on a recurring basis, were determined to be Level 2 within the valuation hierarchy, and were based on independent values provided by financial institutions. Such valuations were determined using widely accepted valuation techniques, including discounted cash flow analyses, on the expected cash flows of each derivative. The analyses reflect the contractual terms of the swaps, including the period to maturity, and

14

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

user-obs ervable market-based inputs, including interest rate curves (“significant other observable inputs”). The fair value calculation also includes an amount for risk of non-performance using “significant unobservable inputs” such as estimates of current credit spreads to evaluate the likelihood of default. The Company has concluded that, as of September 30, 2019, the fair value associated with the “significant unobservable inputs” relating to the Company’s risk of non-performance was insignificant to the overall fair value of the interest rate swap agreements and, as a result, that the relevant inputs for purposes of calculating the fair value of the interest rate swap agreements, in their entirety, were based upon “significant other observable inputs”.

Nonfinancial assets and liabilities measured at fair value in the consolidated financial statements consist of real estate held for sale, which, if applicable, are measured on a nonrecurring basis, and have been determined to be (1) Level 2 within the valuation hierarchy, where applicable, based on the respective contracts of sale, adjusted for closing costs and expenses, or (2) Level 3 within the valuation hierarchy, where applicable, based on estimated sales prices, adjusted for closing costs and expenses, determined by discounted cash flow analyses, income capitalization analyses or a sales comparison approach if no contracts had been concluded. The discounted cash flow and income capitalization analyses include all estimated cash inflows and outflows over a specific holding period and, where applicable, any estimated debt premiums. These cash flows were composed of unobservable inputs which included forecasted rental revenues and expenses based upon existing in-place leases, market conditions and expectations for growth. Capitalization rates and discount rates utilized in these analyses were based upon observable rates that the Company believed to be within a reasonable range of current market rates for the respective properties. The sales comparison approach is utilized for certain land values and includes comparable sales that were completed in the selected market areas. The comparable sales utilized in these analyses were based upon observable per acre rates that the Company believes to be within a reasonable range of current market rates for the respective properties.

Valuations were prepared using internally-developed valuation models. These valuations are reviewed and approved, during each reporting period, by a diverse group of management, as deemed necessary, including personnel from the acquisition, accounting, finance, operations, development and leasing departments, and the valuations are updated as appropriate. In addition, the Company may engage third-party valuation experts to assist with the preparation of certain of its valuations.

The following tables show the hierarchy for those assets measured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018, respectively:

|  | September 30, 2019 |
Description |  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Investments related to deferred |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
compensation liabilities (a) |  | $ | 752,000 |  |  | $ | — |  |  | $ | — |  |  | $ | 752,000 |
Deferred compensation liabilities (b) |  | $ | 756,000 |  |  | $ | — |  |  | $ | — |  |  | $ | 756,000 |
Interest rate swaps asset (a) |  | $ | — |  |  | $ | 74,000 |  |  | $ | — |  |  | $ | 74,000 |
Interest rate swaps liability (b) |  | $ | — |  |  | $ | 9,961,000 |  |  | $ | — |  |  | $ | 9,961,000 |
|  | December 31, 2018 |
Description |  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Investments related to deferred |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
compensation liabilities (a) |  | $ | 616,000 |  |  | $ | — |  |  | $ | — |  |  | $ | 616,000 |
Deferred compensation liabilities (b) |  | $ | 610,000 |  |  | $ | — |  |  | $ | — |  |  | $ | 610,000 |
Interest rate swaps asset (a) |  | $ | — |  |  | $ | 8,871,000 |  |  | $ | — |  |  | $ | 8,871,000 |
Interest rate swaps liability (b) |  | $ | — |  |  | $ | 1,576,000 |  |  | $ | — |  |  | $ | 1,576,000 |
(a) Included in other assets and deferred charges, net in the accompanying consolidated balance sheets. |
(b) Included in accounts payable and accrued liabilities in the accompanying consolidated balance sheets. |

As of September 30, 2019, one retail property, totaling $1.9 million, was determined to be a Level 3 asset under the hierarchy, and was measured at fair value less cost to sell on a non-recurring basis using an income capitalization approach, consisting of a

15

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

capitalization rate of 8.5%. In addition, real estate held for sale on the consolidated ba lance sheet as of September 30, 2 019 includes one property for which its fair value exceeds its carrying value.

Note 5. Mortgage Loans Payable and Credit Facility

Debt and capital lease obligations are composed of the following at September 30, 2019:

|  |  |  | September 30, 2019 |
|  |  |  |  |  |  |  | Contractual |
|  | Maturity |  | Balance |  |  | interest rates |
Description |  | dates |  | outstanding |  |  | weighted-average |
Fixed-rate mortgage |  | Jun 2026 |  | $ | 46,931,000 |  |  | 3.9% |
Capital lease obligation |  | Sep 2050 |  |  | 5,673,000 |  |  | 5.3% |
Unsecured credit facilities (a): |  |  |  |  |  |  |  |  |  |
Variable-rate: |  |  |  |  |  |  |  |  |  |
Revolving credit facility |  | Sep 2021 | (b) |  | 107,000,000 |  |  | 3.6% |
Term loan |  | Sep 2022 |  |  | 50,000,000 |  |  | 3.5% |
Fixed-rate (c): |  |  |  |  |  |  |  |  |  |
Term loan |  | Feb 2021 |  |  | 75,000,000 |  |  | 3.7% |
Term loan |  | Feb 2022 |  |  | 50,000,000 |  |  | 3.1% |
Term loan |  | Sep 2022 | (d) |  | 50,000,000 |  |  | 2.9% |
Term loan |  | Apr 2023 |  |  | 100,000,000 |  |  | 3.3% |
Term loan |  | Sep 2024 |  |  | 75,000,000 |  |  | 3.8% |
Term loan |  | Jul 2025 |  |  | 75,000,000 |  |  | 4.7% |
|  |  |  |  | 634,604,000 |  |  | 3.7% |
Unamortized issuance costs |  |  |  |  | (2,962,000 | ) |  |  |  |
|  |  |  | $ | 631,642,000 |  |  |  |  |

| (a) | During the quarter ended June 30, 2019, the weighted average interest rate for the Company’s unsecured credit facilities increased 14 basis points (“bps”) (ranging from an increase of 10 bps to 15 bps for each individual borrowing) as a result of a slight increase in the Company’s leverage ratio.

| (b) | The revolving credit facility is subject to a one-year extension at the Company’s option.

| (c) | The interest rates on these term loans consist of the London Interbank Offered Rate (“LIBOR”) plus a credit spread based on the Company’s leverage ratio, for which the Company has interest rate swap agreements which convert the LIBOR rates to fixed rates. Accordingly, these term loans are presented as fixed-rate debt.

| (d) | The current interest rate swap agreement expires in February 2020 at which time a new interest rate swap agreement will begin resulting in an effective interest ratio of 3.3%, based on the Company’s leverage ratio at September 30, 2019.

Unsecured Revolving Credit Facility and Term Loans

As of September 30, 2019, the Company had $116.0 million available for additional borrowings under its revolving credit facility. The Company has a $300 million unsecured credit facility which, as amended and restated on September 8, 2017, consists of (1) a $250 million revolving credit facility, expiring on September 8, 2021, and (2) a $50 million term loan, expiring on September 8, 2022. The revolving credit facility may be extended, at the Company’s option, for an additional one-year period, subject to customary conditions. Under an accordion feature, the facility can be increased to $750 million, subject to customary conditions and lending commitments. Interest on borrowings under the revolving credit facility component can range from LIBOR plus 135 bps to 195 bps (150 bps at September 30, 2019) and interest on borrowings under the term loan component can range from LIBOR plus 130 to 190 bps (145 bps at September 30, 2019), each based on the Company’s leverage ratio. During the quarter ended June 30, 2019, the weighted average interest rate for the Company’s unsecured credit facilities increased 14 bps (ranging from an increase of 10 bps to 15 bps for each individual borrowing) as a result of a slight increase in the Company’s leverage ratio.

The Company’s unsecured credit facility and term loans contain financial covenants including, but not limited to, maximum debt leverage, maximum secured debt, minimum fixed charge coverage, and minimum net worth. In addition, the facility contains

16

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

restrictions including, but not limited to, limits on indebtedness, certain investments and distributions. Although the credit facility is unsecured, borrowing availability is based on unencumbered property adjusted net operating income, as defined in the agreements. The Company’s failure to comply with th e covenants or the occurrence of an event of default under the facilities could result in the acceleration of the related debt and exercise of other lender remedies. As of September 30, 2019, the Company is in compliance with all financial covenants. Inter est on borrowings under the unsecured credit facility and term loans are based on the Company’s leverage ratio.

Derivative Financial Instruments

The fair values of the interest rate swaps applicable to the unsecured term loans discussed above are included in other assets and deferred charges, net, and accounts payable and accrued liabilities on the consolidated balance sheet at September 30, 2019. Charges and/or credits relating to the changes in the fair value of the interest rate swaps are made to accumulated other comprehensive income (loss), limited partners’ interest, or operations (included in interest expense), as applicable. Over time, the unrealized gains and losses recorded in accumulated other comprehensive loss will be reclassified into earnings as an increase or reduction to interest expense in the same periods in which the hedged interest payments affect earnings. The Company estimates that approximately $1.4 million of accumulated other comprehensive income will be reclassified as an increase to earnings within the next twelve months.

The following is a summary of the derivative financial instruments held by the Company at September 30, 2019 and December 31, 2018:

September 30, 2019
Designation/ |  |  |  |  |  |  |  | Fair |  |  | Maturity |  | Balance sheet
Cash flow |  | Derivative |  | Count |  |  | value |  |  | dates |  | location
Qualifying |  | Interest rate swaps |  |  | 1 |  |  | $ | 74,000 |  |  | 2020 |  | Other assets and deferred charges, net
Qualifying |  | Interest rate swaps |  |  | 7 |  |  | $ | 9,961,000 |  |  | 2021-2025 |  | Accounts payable and accrued liabilities
December 31, 2018
Designation/ |  |  |  |  |  |  |  | Fair |  |  | Maturity |  | Balance sheet
Cash flow |  | Derivative |  | Count |  |  | value |  |  | dates |  | location
Qualifying |  | Interest rate swaps |  |  | 7 |  |  | $ | 8,871,000 |  |  | 2019-2024 |  | Other assets and deferred charges, net
Qualifying |  | Interest rate swaps |  |  | 2 |  |  | $ | 1,576,000 |  |  | 2025 |  | Accounts payable and accrued liabilities

The notional values of the interest rate swaps held by the Company at September 30, 2019 and December 31, 2018 were $425.0 million and $425.0 million, respectively.

17

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

The following presents the effect of the Company’s derivative financial in struments on the consolidated statements of operations and the consolidated statements of equity for the three and nine months ended September 30, 2019 and 2018, respectively:

|  |  |  | (Loss) gain recognized in other |
|  |  |  | comprehensive (loss) income |
|  |  |  | (effective portion) |
Designation/ |  |  |  | Three months ended September 30, |  |  | Nine months ended September 30, |
Cash flow |  | Derivative |  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Qualifying |  | Interest rate swaps |  | $ | (2,883,000 | ) |  | $ | 2,375,000 |  |  | $ | (15,837,000 | ) |  | $ | 10,221,000 |
|  |  |  | Gain (loss) recognized in other |
|  |  |  | comprehensive (loss) income |
|  |  |  | reclassified into earnings (effective portion) |
|  |  |  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | Classification |  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
|  | Continuing Operations |  | $ | 216,000 |  |  | $ | 246,000 |  |  | $ | 1,300,000 |  |  | $ | 265,000 |

As of September 30, 2019 the Company believes it has no significant risk associated with non-performance of the financial institutions which are the counterparties to its derivative contracts.

Note 6. Commitments and Contingencies

The Company is a party to certain legal actions arising in the normal course of business. Management does not expect there to be adverse consequences from these actions that would be material to the Company’s consolidated financial statements.

The Company is the lessee under several ground lease and its executive office lease agreements. In accordance with the adoption of the new lease accounting standard (see Note 2 – “Recently-Adopted Accounting Pronouncements”), the Company recorded right-of-use assets and related lease liabilities for these leases as of January 1, 2019. As of September 30, 2019, the Company’s weighted average remaining lease term is approximately 32.2 years and the weighted average discount rate used to calculate the Company’s lease liability is approximately 5.7%. Rent expense under the Company’s ground lease and executive office lease agreements was approximately $0.4 million and $0.4 million for the three months ended September 30, 2019 and 2018, respectively, and $1.3 million and $0.8 million for the nine months ended September 30, 2019 and 2018, respectively.

The following table represents a reconciliation of the Company’s undiscounted future minimum lease payments for its ground lease and executive office lease agreements to the right-of-use liabilities as of September 30, 2019:

2019 - remaining |  | $ | 414,000 |
2020 |  |  | 1,095,000 |
2021 |  |  | 956,000 |
2022 |  |  | 955,000 |
2023 |  |  | 956,000 |
Thereafter |  |  | 30,466,000 |
Total undiscounted future minimum lease payments |  |  | 34,842,000 |
Future minimum lease payments, discount |  |  | (20,850,000 | )
Right-of-use liabilities |  | $ | 13,992,000 |

18

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

Note 7. Shareholders’ Equity

Preferred Stock

The Company is authorized to issue up to 12,500,000 shares of preferred stock. The following tables summarize details about the Company’s preferred stock:

|  | Series B |  |  | Series C |  |  |  |  |  |  |  |  |
|  | Preferred Stock |  |  | Preferred Stock |  |  |  |  |  |  |  |  |
Par value |  | $ | 0.01 |  |  | $ | 0.01 |  |  |  |  |  |  |  |  |
Liquidation value |  | $ | 25.00 |  |  | $ | 25.00 |  |  |  |  |  |  |  |  |
|  | September 30, 2019 |  |  | December 31, 2018 |
|  | Series B |  |  | Series C |  |  | Series B |  |  | Series C |
|  | Preferred Stock |  |  | Preferred Stock |  |  | Preferred Stock |  |  | Preferred Stock |
Shares authorized |  |  | 1,450,000 |  |  |  | 6,450,000 |  |  |  | 1,450,000 |  |  |  | 6,450,000 |
Shares issued and outstanding |  |  | 1,450,000 |  |  |  | 5,000,000 |  |  |  | 1,450,000 |  |  |  | 5,000,000 |
Balance |  | $ | 34,767,000 |  |  | $ | 124,774,000 |  |  | $ | 34,767,000 |  |  |  | 124,774,000 |

Common Stock

On December 18, 2018, the Company’s Board of Directors approved a stock repurchase program, which authorized the Company to purchase up to $30.0 million of the Company’s common stock in the open market or through private transactions, subject to market conditions, from time to time, through December 18, 2019. During the nine months ended September 30, 2019, the Company repurchased approximately 2,050,000 shares at a weighted average price per share of $3.34. Since approval of the plan on December 18, 2018, the Company has repurchased a total of 2,823,000 shares at a weighted average price per share of $3.25.

Dividends

The following table provides a summary of dividends declared and paid per share:

|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Common stock |  | $ | 0.050 |  |  | $ | 0.050 |  |  | $ | 0.150 |  |  | $ | 0.150 |
7.25% Series B Preferred Stock |  | $ | 0.453 |  |  | $ | 0.453 |  |  | $ | 1.359 |  |  | $ | 1.359 |
6.50% Series C Preferred Stock |  | $ | 0.406 |  |  | $ | 0.406 |  |  | $ | 1.219 |  |  | $ | 1.219 |

On October 18, 2019, the Company’s Board of Directors declared a dividend of $0.05 per share with respect to its common stock. At the same time, the Board declared dividends of $0.453125 and $0.406250 per share with respect to the Company’s Series B Preferred Stock and Series C Preferred Stock, respectively. The distributions are payable on November 20, 2019 to shareholders of record on November 8, 2019.

19

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

Note 8. Revenues

Rental revenues for the three and nine months ended September 30, 2019 and 2018, respectively, comprise the following:

|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Base rents |  | $ | 26,237,000 |  |  | $ | 26,878,000 |  |  | $ | 78,990,000 |  |  | $ | 80,901,000 |
Expense recoveries |  |  | 7,935,000 |  |  |  | 7,747,000 |  |  |  | 25,079,000 |  |  |  | 24,800,000 |
Percentage rent |  |  | 252,000 |  |  |  | 181,000 |  |  |  | 699,000 |  |  |  | 396,000 |
Straight-line rents |  |  | 76,000 |  |  |  | 332,000 |  |  |  | 411,000 |  |  |  | 824,000 |
Amortization of intangible lease liabilities, net |  |  | 990,000 |  |  |  | 729,000 |  |  |  | 2,212,000 |  |  |  | 3,611,000 |
Total rents |  | $ | 35,490,000 |  |  | $ | 35,867,000 |  |  | $ | 107,391,000 |  |  | $ | 110,532,000 |

Note 9. Share-Based Compensation

The following tables set forth certain share-based compensation information for the three and nine months ended September 30, 2019 and 2018, respectively:

|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Expense relating to share/unit grants |  | $ | 1,127,000 |  |  | $ | 1,080,000 |  |  | $ | 3,364,000 |  |  | $ | 3,134,000 |
Amounts capitalized |  |  | (92,000 | ) |  |  | (116,000 | ) |  |  | (286,000 | ) |  |  | (333,000 | )
Total charged to operations |  | $ | 1,035,000 |  |  | $ | 964,000 |  |  | $ | 3,078,000 |  |  | $ | 2,801,000 |

The Company’s 2017 Stock Incentive Plan (the “2017 Plan”) establishes the procedures for the granting of, among other things, restricted stock awards. On May 1, 2019, the Company’s shareholders approved an amendment to the 2017 Plan, which increased the maximum number of shares available for issuance under the plan by 2.0 million shares, to a new total of 6.0 million shares. 2.4 million shares remained available for grants pursuant to the 2017 Plan as of September 30, 2019.

During the nine months ended September 30, 2019, there were 522,000 restricted shares issued, with a weighted average grant date fair value of $3.22 per share.

Note 10. Earnings Per Share

Basic earnings per share (“EPS”) is calculated by dividing net income (loss) attributable to the Company’s common shareholders by the weighted average number of common shares outstanding for the period including participating securities (restricted shares that have non-forfeitable rights to receive dividends issued pursuant to the Company’s share-based compensation program are considered participating securities). Unvested restricted shares that are participating securities are not allocated net losses and/or any excess of dividends declared over net income, as such amounts are allocated entirely to the common shareholders. For the three months ended September 30, 2019 and 2018, the Company had 2.8 million and 2.2 million, respectively, of weighted average unvested restricted shares outstanding that were participating securities. For the nine months ended September 30, 2019 and 2018, the Company had 2.8 million and 3.3 million, respectively, of weighted average unvested restricted shares outstanding that were participating securities. The following table provides a reconciliation of the numerator and denominator of the EPS calculations for the three and nine months ended September 30, 2019 and 2018:

20

Cedar Realty Trust, Inc.

Notes to Consolidated Financial Statements

September 30, 2019

(unaudited)

|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Numerator |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) |  | $ | 2,947,000 |  |  | $ | 6,305,000 |  |  | $ | 11,480,000 |  |  | $ | (378,000 | )
Preferred stock dividends |  |  | (2,688,000 | ) |  |  | (2,688,000 | ) |  |  | (8,064,000 | ) |  |  | (8,175,000 | )
Preferred stock redemptions costs |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (3,507,000 | )
Net (income) attributable to noncontrolling interests |  |  | (167,000 | ) |  |  | (145,000 | ) |  |  | (435,000 | ) |  |  | (353,000 | )
Net earnings allocated to unvested shares |  |  | (138,000 | ) |  |  | (108,000 | ) |  |  | (420,000 | ) |  |  | (520,000 | )
Net (loss) income attributable to vested common shares |  | $ | (46,000 | ) |  | $ | 3,364,000 |  |  | $ | 2,561,000 |  |  | $ | (12,933,000 | )
Denominator |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Weighted average number of vested common shares outstanding, basic |  |  | 86,262,000 |  |  |  | 89,049,000 |  |  |  | 86,367,000 |  |  |  | 88,228,000 |
Assumed vesting of market performance-based restricted stock units |  |  | - |  |  |  | 826,000 |  |  |  | - |  |  |  | - |
Weighted average number of vested common shares outstanding, diluted |  |  | 86,262,000 |  |  |  | 89,875,000 |  |  |  | 86,367,000 |  |  |  | 88,228,000 |
Net (loss) income per common share attributable to common shareholders, basic |  | $ | (0.00 | ) |  | $ | 0.04 |  |  | $ | 0.03 |  |  | $ | (0.15 | )
Net (loss) income per common share attributable to common shareholders, diluted |  | $ | (0.00 | ) |  | $ | 0.04 |  |  | $ | 0.03 |  |  | $ | (0.15 | )

Fully-diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into shares of common stock. For the three and nine months ended September 30, 2019, no restricted stock units (“RSU’s”) would have been issuable under the Company’s President and CEO market performance-based equity award had the measurement period ended on September 30, 2019; therefore this market performance-based equity award had no impact in calculation diluted EPS. In addition, fully-diluted EPS for the three months ended September 30, 2018 includes RSU’s that would have been issuable had the measurement period ended on September 30, 2018, whereas for the nine months ended September 30, 2018, these shares were excluded as they were anti-dilutive. Net income/loss attributable to noncontrolling interests of the Operating Partnership has been excluded from the numerator and the related OP Units have been excluded from the denominator for the purpose of calculating diluted EPS as there would have been no dilutive effect had such amounts been included. The weighted average number of OP Units outstanding were 544,000 and 469,000 for the three months ended September 30, 2019 and 2018, respectively, and 550,000 and 388,000 for the nine months ended September 30, 2019 and 2018, respectively.

Note 11. Subsequent Events

In determining subsequent events, management reviewed all activity from October 1, 2019 through the date of filing this Quarterly Report on Form 10-Q. There were no events or transactions that occurred that would require adjustment to, or disclosure in, the Company’s consolidated financial statements.

21

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the Company’s consolidated financial statements and related notes thereto included elsewhere in this report.

Executive Summary

The Company is a fully-integrated real estate investment trust that focuses primarily on ownership, operation and redevelopment of grocery-anchored shopping centers in high-density urban markets from Washington, D.C. to Boston. At September 30, 2019, the Company owned and managed a portfolio of 57 operating properties (excluding properties “held for sale”) totaling 8.5 million square feet of gross leasable area (“GLA”). The portfolio was 92.3% leased and 90.8% occupied at September 30, 2019.

The Company derives substantially all of its revenues from rents and operating expense reimbursements received pursuant to leases. The Company’s operating results therefore depend on the ability of its tenants to make the payments required by the terms of their leases. The Company focuses its investment activities on grocery-anchored shopping centers. The Company believes that, because of the need of consumers to purchase food and other staple goods and services generally available at such centers, its type of “necessities-based” properties should provide relatively stable revenue flows even during difficult economic times.

Significant Transactions

Acquisition

On June 19, 2019, the Company purchased Girard Plaza, a shopping center adjacent to its South Philadelphia property, located in Philadelphia, Pennsylvania. The purchase price for the property was $8.5 million, which has been allocated to real estate assets and liabilities.

Dispositions

On February 15, 2019, the Company sold Maxatawny Marketplace, located in Maxatawny, Pennsylvania. The sales price for the property was $10.3 million, which resulted in a gain on sale of $0.1 million, which has been included in continuing operations in the accompanying consolidated statement of operations.

On June 26, 2019, the Company sold Fort Washington Center, located in Fort Washington, Pennsylvania. The sales price for the property was $9.0 million, which resulted in a gain on sale of $2.8 million, which has been included in continuing operations in the accompanying consolidated statement of operations.

Real Estate Held for Sale

As of September 30, 2019, Carll’s Corner, located in Bridgeton, New Jersey and Suffolk Plaza, located in Suffolk, Virginia have been classified as “real estate held for sale” on the accompanying consolidated balance sheet.

Equity

On December 18, 2018, the Company’s Board of Directors approved a stock repurchase program, which authorized the Company to purchase up to $30.0 million of the Company’s common stock in the open market or through private transactions, subject to market conditions, from time to time, through December 18, 2019. During the nine months ended September 30, 2019, the Company repurchased approximately 2,050,000 shares at a weighted average price per share of $3.34. Since approval of the plan on December 18, 2018, the Company has repurchased a total of 2,823,000 shares at a weighted average price per share of $3.25.

Critical Accounting Policies

The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition and the allowance for doubtful accounts receivable, real estate investments and purchase accounting allocations related thereto, asset impairments, and derivatives used to hedge interest-rate risks. Management’s estimates are based both on information that is currently available and on various other assumptions management believes to be reasonable under the circumstances. Actual results could differ from those estimates and those estimates could be different under varying assumptions or conditions.

22

The Company believes there have been no material changes to the items disclosed as its critical accounting policies under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in the Company’s Annual Report on For m 10-K for the year ended December 31, 2018. See Note 2 – “Summary of Significant Accounting Policies” for recently-adopted accounting pronouncements.

Results of Operations

Comparison of three months ended September 30, 2019 to September 30, 2018

|  |  |  |  |  |  |  |  |  | Change |
|  | 2019 |  |  | 2018 |  |  | Dollars |  |  | Percent |
Revenues |  | $ | 35,912,000 |  |  | $ | 36,170,000 |  |  | $ | (258,000 | ) |  | -0.7% |
Property operating expenses |  |  | (11,499,000 | ) |  |  | (11,431,000 | ) |  |  | (68,000 | ) |  | 0.6% |
Property operating income |  |  | 24,413,000 |  |  |  | 24,739,000 |  |  |  | (326,000 | ) |  |  |  |
General and administrative |  |  | (4,886,000 | ) |  |  | (3,975,000 | ) |  |  | (911,000 | ) |  | 22.9% |
Depreciation and amortization |  |  | (10,547,000 | ) |  |  | (9,650,000 | ) |  |  | (897,000 | ) |  | 9.3% |
Gain on sale |  |  | — |  |  |  | 4,864,000 |  |  |  | (4,864,000 | ) |  | n/a |
Impairment reversal |  |  | — |  |  |  | 707,000 |  |  |  | (707,000 | ) |  | n/a |
Interest expense |  |  | (6,033,000 | ) |  |  | (5,551,000 | ) |  |  | (482,000 | ) |  | 8.7% |
Early extinguishment of debt costs |  |  | — |  |  |  | (4,829,000 | ) |  |  | 4,829,000 |  |  | n/a |
Net income |  |  | 2,947,000 |  |  |  | 6,305,000 |  |  |  | (3,358,000 | ) |  |  |  |
Net (income) attributable to noncontrolling interests |  |  | (167,000 | ) |  |  | (145,000 | ) |  |  | (22,000 | ) |  |  |  |
Net income attributable to Cedar Realty Trust, Inc. |  | $ | 2,780,000 |  |  | $ | 6,160,000 |  |  | $ | (3,380,000 | ) |  |  |  |

Revenues were lower primarily as a result of (1) a decrease of $0.7 million in rental revenues and expense recoveries attributable to properties that were sold or held for sale in 2019 and 2018, and (2) a decrease of $0.3 million in rental revenues and expense recoveries attributable to same-center properties which was driven by the adoption of the new lease accounting standard (see Note 2 – “Recently-Adopted Accounting Pronouncements”), partially offset by (1) an increase of $0.4 million in rental revenues and expense recoveries attributable to properties acquired in 2019 and 2018, (2) an increase of $0.3 million in rental revenues and expense recoveries attributable to redevelopment properties, and (3) an increase in other income of $0.1 million.

Property operating expenses were slightly higher primarily as a result of (1) an increase of $0.5 million in property operating expenses attributable to redevelopment properties, and (2) an increase of $0.2 million in property operating expenses attributable to properties acquired in 2019 and 2018, partially offset by (1) a decrease of $0.3 million in property operating expenses attributable to same-center properties which was driven by the adoption of the new lease accounting standard (see Note 2 – “Recently-Adopted Accounting Pronouncements”), and (2) a decrease of $0.3 million in property operating expenses attributable to properties that were sold or held for sale in 2019 and 2018.

General and administrative costs were higher primarily as a result of an increase in payroll expense predominantly relating to the adoption of the new lease accounting standard in 2019 which no longer permits the capitalization of initial direct leasing costs.

Depreciation and amortization expenses were higher as a result (1) an increase of $0.5 million attributable to same-center properties, (2) an increase of $0.3 million attributable to redevelopment properties, and (3) an increase of $0.2 million attributable to properties acquired in 2019 and 2018, partially offset by of a decrease of $0.1 million attributable to properties that were sold or held for sale in 2019 and 2018.

Gain on sale in 2018 relates to the sale of Mechanicsburg Center, located in Mechanicsburg, Pennsylvania.

Impairment reversal in 2018 relates to the sale of West Bridgewater Plaza, located in West Bridgewater, Massachusetts.

Interest expense was higher as the overall weighted average interest rate increased which resulted in an increase in interest expense of $0.6 million, partially offset by an increase in capitalized interest of $0.1 million.

Early extinguishment of debt costs in 2018 relates to defeasement fees and the accelerated write-off of unamortized costs associated with the prepayment of certain mortgage loans payable.

23

Comparison of nine months ended September 30, 2019 to September 30, 2018

|  |  |  |  |  |  |  |  |  | Change |
|  | 2019 |  |  | 2018 |  |  | Dollars |  |  | Percent |
Revenues |  | $ | 108,455,000 |  |  | $ | 115,088,000 |  |  | $ | (6,633,000 | ) |  | -5.8% |
Property operating expenses |  |  | (35,925,000 | ) |  |  | (35,354,000 | ) |  |  | (571,000 | ) |  | 1.6% |
Property operating income |  |  | 72,530,000 |  |  |  | 79,734,000 |  |  |  | (7,204,000 | ) |  |  |  |
General and administrative |  |  | (15,102,000 | ) |  |  | (12,745,000 | ) |  |  | (2,357,000 | ) |  | 18.5% |
Depreciation and amortization |  |  | (31,022,000 | ) |  |  | (30,245,000 | ) |  |  | (777,000 | ) |  | 2.6% |
Gain on sales |  |  | 2,942,000 |  |  |  | 4,864,000 |  |  |  | (1,922,000 | ) |  | n/a |
Impairment charges |  |  | — |  |  |  | (20,689,000 | ) |  |  | 20,689,000 |  |  | n/a |
Interest expense |  |  | (17,868,000 | ) |  |  | (16,468,000 | ) |  |  | (1,400,000 | ) |  | 8.5% |
Early extinguishment of debt costs |  |  | — |  |  |  | (4,829,000 | ) |  |  | 4,829,000 |  |  | n/a |
Net income (loss) |  |  | 11,480,000 |  |  |  | (378,000 | ) |  |  | 11,858,000 |  |  |  |  |
Net (income) attributable to noncontrolling interests |  |  | (435,000 | ) |  |  | (353,000 | ) |  |  | (82,000 | ) |  |  |  |
Net income (loss) attributable to Cedar Realty Trust, Inc. |  | $ | 11,045,000 |  |  | $ | (731,000 | ) |  | $ | 11,776,000 |  |  |  |  |

Revenues were lower primarily as a result of (1) $5.4 million relating to a dark anchor tenant terminating its lease prior to the contractual expiration in 2018 at West Bridgewater Plaza, (2) a decrease of $2.4 million in rental revenues and expense recoveries attributable to properties that were sold or held for sale in 2019 and 2018, and (3) a decrease of $1.2 million in rental revenues and expense recoveries attributable to same-center properties which was driven by the adoption of the new lease accounting standard (see Note 2 – “Recently-Adopted Accounting Pronouncements”), partially offset by (1) an increase of $1.4 million in rental revenues and expense recoveries attributable to properties acquired in 2019 and 2018, (2) an increase of $0.5 million in rental revenues and expense recoveries attributable to redevelopment properties, and (3) an increase of other income of $0.4 million.

Property operating expenses were higher primarily as a result of (1) an increase of $0.9 million in property operating expenses attributable to properties acquired in 2019 and 2018, and (2) an increase of $0.9 million in property operating expenses attributable to the Company’s redevelopment properties, partially offset by (1) a decrease of $0.6 million in property operating expenses attributable to same-center properties which was driven by the adoption of the new lease accounting standard (see Note 2 – “Recently-Adopted Accounting Pronouncements”), and (2) a decrease of $0.6 million in property operating expenses attributable to properties that were sold or held for sale in 2019 and 2018.

General and administrative costs were higher primarily as a result of (1) an increase in payroll expense of $1.8 million predominantly relating to the adoption of the new lease accounting standard in 2019 which no longer permits the capitalization of initial direct leasing costs, and (2) an increase in professional fees of $0.2 million, and (3) an increase in payroll and payroll related expenses of $0.2 million related to the hiring of several new employees.

Depreciation and amortization expenses were higher primarily as a result (1) an increase of $1.0 million attributable to redevelopment properties, (2) an increase of $0.8 million attributable to same-center properties, and (3) an increase of $0.5 million attributable to properties acquired in 2019 and 2018, partially offset by a decrease of $1.5 million attributable to properties that were sold or held for sale in 2019 and 2018.

Gain on sales in 2019 relates to the sale of Maxatawny Marketplace, located in Maxatawny, Pennsylvania and Fort Washington Center, located in Fort Washington, Pennsylvania. Gain on sale in 2018 relates to the sale of Mechanicsburg Center, located in Mechanicsburg, Pennsylvania.

Impairment charges in 2018 relate to impairments on (1) Carll’s Corner, located in Bridgeton, New Jersey, and (2) West Bridgewater Plaza, located in West Bridgewater, Massachusetts, which was sold on September 28, 2018.

Interest expense was higher as a result of an increase in the overall weighted average interest rate.

Early extinguishment of debt costs in 2018 relates to defeasement fees and the accelerated write-off of unamortized costs associated with the prepayment of certain mortgage loans payable.

24

Same-Property Net Operating Income

Same-property net operating income (“same-property NOI”) is a widely-used non-GAAP financial measure for REITs that the Company believes, when considered with financial statements prepared in accordance with GAAP, is useful to investors as it provides an indication of the recurring cash generated by the Company’s properties by excluding certain non-cash revenues and expenses, as well as other infrequent items such as lease termination income which tends to fluctuate more than rents from year to year. Properties are included in same-property NOI if they are owned and operated for the entirety of both periods being compared, except for properties undergoing significant redevelopment and expansion until such properties have stabilized, and properties classified as held for sale. Consistent with the capital treatment of such costs under GAAP, tenant improvements, leasing commissions and other direct leasing costs are excluded from same-property NOI.

The most directly comparable GAAP financial measure is consolidated operating income. Same-property NOI should not be considered as an alternative to consolidated operating income prepared in accordance with GAAP or as a measure of liquidity. Further, same-property NOI is a measure for which there is no standard industry definition and, as such, it is not consistently defined or reported on among the Company’s peers, and thus may not provide an adequate basis for comparison among REITs.

The following table reconciles same-property NOI to the Company’s consolidated operating income:

|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Operating income |  | $ | 8,980,000 |  |  | $ | 16,685,000 |  |  | $ | 29,348,000 |  |  | $ | 20,919,000 |
Add (deduct): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
General and administrative |  |  | 4,886,000 |  |  |  | 3,975,000 |  |  |  | 15,102,000 |  |  |  | 12,745,000 |
Gain on sales |  |  | — |  |  |  | (4,864,000 | ) |  |  | (2,942,000 | ) |  |  | (4,864,000 | )
Impairment (reversal)/charges |  |  | — |  |  |  | (707,000 | ) |  |  | — |  |  |  | 20,689,000 |
Depreciation and amortization |  |  | 10,547,000 |  |  |  | 9,650,000 |  |  |  | 31,022,000 |  |  |  | 30,245,000 |
Straight-line rents |  |  | (76,000 | ) |  |  | (332,000 | ) |  |  | (411,000 | ) |  |  | (824,000 | )
Amortization of intangible lease liabilities |  |  | (990,000 | ) |  |  | (729,000 | ) |  |  | (2,212,000 | ) |  |  | (3,611,000 | )
Other adjustments |  |  | (22,000 | ) |  |  | (4,000 | ) |  |  | (139,000 | ) |  |  | (146,000 | )
NOI related to properties not defined as same-property |  |  | (3,865,000 | ) |  |  | (4,357,000 | ) |  |  | (11,976,000 | ) |  |  | (17,180,000 | )
Same-property NOI |  | $ | 19,460,000 |  |  | $ | 19,317,000 |  |  | $ | 57,792,000 |  |  | $ | 57,973,000 |
Number of same properties |  |  | 48 |  |  |  | 48 |  |  |  | 48 |  |  |  | 48 |
Same-property occupancy, end of period |  |  | 90.5 | % |  |  | 91.8 | % |  |  | 90.5 | % |  |  | 91.8 | %
Same-property leased, end of period |  |  | 92.2 | % |  |  | 92.2 | % |  |  | 92.2 | % |  |  | 92.2 | %
Same-property average base rent, end of period |  | $ | 13.31 |  |  | $ | 13.07 |  |  | $ | 13.31 |  |  | $ | 13.07 |

Same-property NOI for the comparable three and nine months periods remained relatively consistent as a decrease in occupancy of 130 bps was offset by an increase in average base rent of $0.24 per square foot.

25

Leasi ng Activity

The following is a summary of the Company’s retail leasing activity during the nine months ended September 30, 2019:

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Tenant |  |
|  |  |  |  |  |  |  |  |  | New rent |  |  | Prior rent |  |  | Cash basis |  |  | improvements |  |
|  | Leases |  |  |  |  |  |  | per |  |  | per |  |  | % |  |  | per |  |
|  | signed |  |  | GLA |  |  | sq.ft. ($) |  |  | sq.ft. ($) |  |  | change |  |  | sq.ft. ($) |  |
Renewals |  |  | 85 |  |  |  | 1,178,100 |  |  |  | 11.72 |  |  |  | 11.81 |  |  |  | -0.7 | % |  |  | 1.16 |  |
New Leases - Comparable |  |  | 30 |  |  |  | 252,000 |  |  |  | 11.79 |  |  |  | 9.94 |  |  |  | 18.6 | % |  |  | 50.83 |  | (a)
New Leases - Non-Comparable (b) |  |  | 6 |  |  |  | 14,900 |  |  |  | 37.91 |  |  | n/a |  |  | n/a |  |  |  | 6.65 |  | (a)
Total (c) |  |  | 121 |  |  |  | 1,445,000 |  |  |  | 12.00 |  |  | n/a |  |  | n/a |  |  |  | 9.99 |  |

| (a) | Includes both tenant allowance and landlord work. Excludes first generation space.

| (b) | Includes leases signed at first generation and expansion spaces.

| (c) | Legal fees and leasing commissions averaged a combined total of $1.38 per square foot.

Liquidity and Capital Resources

The Company funds operating expenses and other short-term liquidity requirements, including debt service, tenant improvements, leasing commissions, preferred and common dividend distributions and distributions to minority interest partners, if made, primarily from its operations. The Company may also use its revolving credit facility for these purposes. The Company expects to fund long-term liquidity requirements for property acquisitions, redevelopment costs, capital improvements, and maturing debt initially with its revolving credit facility, and ultimately through a combination of issuing and/or assuming additional debt, the sale of equity securities, the issuance of additional OP Units, and/or the sale of properties. Although the Company believes it has access to secured and unsecured financing, there can be no assurance that the Company will have the availability of financing on completed development projects, additional construction financing, or proceeds from the refinancing of existing debt.

As of September 30, 2019, the Company had $116.0 million available for additional borrowings under its revolving credit facility. The Company has a $300 million unsecured credit facility which, as amended and restated on September 8, 2017, consisting of (1) a $250 million revolving credit facility, and (2) a $50 million term loan. Under an accordion feature, the facility can be increased to $750 million, subject to customary conditions and lending commitments.

The Company’s unsecured credit facility and term loans contain financial covenants including, but not limited to, maximum debt leverage, maximum secured debt, minimum fixed charge coverage, and minimum net worth. In addition, the facilities contain restrictions including, but not limited to, limits on indebtedness, certain investments and distributions. Although the credit facilities are unsecured, borrowing availability is based on unencumbered property adjusted net operating income, as defined in the agreements. The Company’s failure to comply with the covenants or the occurrence of an event of default under the facilities could result in the acceleration of the related debt and exercise of other lender remedies. As of September 30, 2019, the Company is in compliance with all financial covenants. Interest on borrowings under the unsecured credit facility and term loans are based on the Company’s leverage ratio.

26

Debt and capital lease obligations are composed of the following at September 30, 2019:

|  |  |  | September 30, 2019 |
|  |  |  |  |  |  |  | Contractual |
|  | Maturity |  | Balance |  |  | interest rates |
Description |  | dates |  | outstanding |  |  | weighted-average |
Fixed-rate mortgage |  | Jun 2026 |  | $ | 46,931,000 |  |  | 3.9% |
Capital lease obligation |  | Sep 2050 |  |  | 5,673,000 |  |  | 5.3% |
Unsecured credit facilities (a): |  |  |  |  |  |  |  |  |  |
Variable-rate: |  |  |  |  |  |  |  |  |  |
Revolving credit facility |  | Sep 2021 | (b) |  | 107,000,000 |  |  | 3.6% |
Term loan |  | Sep 2022 |  |  | 50,000,000 |  |  | 3.5% |
Fixed-rate (c): |  |  |  |  |  |  |  |  |  |
Term loan |  | Feb 2021 |  |  | 75,000,000 |  |  | 3.7% |
Term loan |  | Feb 2022 |  |  | 50,000,000 |  |  | 3.1% |
Term loan |  | Sep 2022 | (d) |  | 50,000,000 |  |  | 2.9% |
Term loan |  | Apr 2023 |  |  | 100,000,000 |  |  | 3.3% |
Term loan |  | Sep 2024 |  |  | 75,000,000 |  |  | 3.8% |
Term loan |  | Jul 2025 |  |  | 75,000,000 |  |  | 4.7% |
|  |  |  |  | 634,604,000 |  |  | 3.7% |
Unamortized issuance costs |  |  |  |  | (2,962,000 | ) |  |  |  |
|  |  |  | $ | 631,642,000 |  |  |  |  |

| (a) | During the quarter ended June 30, 2019, the weighted average interest rate for the Company’s unsecured credit facilities increased 14 bps (ranging from an increase of 10 bps to 15 bps for each individual borrowing) as a result of a slight increase in the Company’s leverage ratio.

| (b) | The revolving credit facility is subject to a one-year extension at the Company’s option.

(c) The interest rates on these term loans consist of LIBOR plus a credit spread based on the Company’s leverage ratio, for which the Company has interest rate swap agreements which convert the LIBOR rates to fixed rates. Accordingly, these term loans are presented as fixed-rate debt.

(d) The current interest rate swap agreement expires in February 2020 at which time a new interest rate swap agreement will begin resulting in an effective interest ratio of 3.3%, based on the Company’s leverage ratio at September 30, 2019.

The following table details the Company’s debt and capital lease obligation maturities at September 30, 2019:

|  | Mortgage Loan |  |  | Capital Lease |  |  | Revolving |  |  | Term |  |  |  |  |
Year |  | Payable |  |  | Obligation |  |  | Credit Facility |  |  | Loans |  |  | Total |
2019 |  | $ | 252,000 |  |  | $ | 9,000 |  |  | $ | - |  |  | $ | - |  |  | $ | 261,000 |
2020 |  |  | 1,034,000 |  |  |  | 33,000 |  |  |  | - |  |  |  | - |  |  |  | 1,067,000 |
2021 |  |  | 1,074,000 |  |  |  | 35,000 |  |  |  | 107,000,000 |  | (a) |  | 75,000,000 |  |  |  | 183,109,000 |
2022 |  |  | 1,116,000 |  |  |  | 37,000 |  |  |  | - |  |  |  | 150,000,000 |  |  |  | 151,153,000 |
2023 |  |  | 1,160,000 |  |  |  | 39,000 |  |  |  | - |  |  |  | 100,000,000 |  |  |  | 101,199,000 |
Thereafter |  |  | 42,295,000 |  |  |  | 5,520,000 |  |  |  | - |  |  |  | 150,000,000 |  |  |  | 197,815,000 |
|  | $ | 46,931,000 |  |  | $ | 5,673,000 |  |  | $ | 107,000,000 |  |  | $ | 475,000,000 |  |  | $ | 634,604,000 |

| (a) | The revolving credit facility is subject to a one-year extension at the Company’s option.

The remaining property-specific mortgage loan payable matures in 2026. Mortgage loans payable may require the Company to deposit certain replacement and other reserves with its lenders. Such “restricted cash” is generally available only for property-level requirements for which the reserves have been established, and is not available to fund other property-level or Company-level obligations.

In order to continue qualifying as a REIT, the Company is required to distribute at least 90% of its “REIT taxable income”, as defined in the Internal Revenue Code of 1986, as amended (the “Code”). The Company paid common and preferred stock dividends during 2018, and has continued to declare and pay common and preferred stock dividends during 2019. While the Company intends to continue paying regular quarterly dividends, future dividend declarations will continue to be at the discretion of the Board of Directors, and will depend on the cash flow and financial condition of the Company, capital requirements, annual distribution

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requirements under the REIT provisions of the Code, and such other factors as the Board of Directors may deem relevant. Additionally, the Company may reduce or suspend payment of dividends to retain cash and reduce debt obligations and/or to fund redevel opments and other capital needs.

Net Cash Flows

|  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |
Cash flows provided by (used in): |  |  |  |  |  |  |  |
Operating activities |  | $ | 36,394,000 |  |  | $ | 39,977,000 |
Investing activities |  | $ | (14,248,000 | ) |  | $ | (6,480,000 | )
Financing activities |  | $ | (22,140,000 | ) |  | $ | (36,318,000 | )

Operating Activities

Net cash provided by operating activities, before net changes in operating assets and liabilities, was $41.3 million for the nine months ended September 30, 2019 and $51.4 million for the nine months ended September 30, 2018. The decrease was primarily a result of (1) the Company accepting a payment of $4.3 million in consideration for permitting a dark anchor tenant to terminate its lease prior to the contractual expiration in 2018, (2) an increase in cash paid for interest, and (3) property dispositions in 2019 and 2018.

Investing Activities

Net cash flows used in investing activities were primarily the result of the Company’s property acquisitions, expenditures for property improvements and property disposition activities. During the nine months ended September 30, 2019 the Company incurred expenditures of $23.8 million for property improvements, and acquired a property for $9.1 million, which was partially offset by $18.7 million in proceeds from the sales of properties. During the nine months ended September 30, 2018, the Company incurred expenditures of $21.9 million for property improvements and issued a $3.5 million mortgage note receivable, which was partially offset by $19.1 million in proceeds from the sale of properties.

Financing Activities

During the nine months ended September 30, 2019, the Company paid $21.4 million of preferred and common stock distributions, had $6.8 million of common stock repurchases, and had $0.8 million of mortgage repayments, which was partially offset by net borrowings of $7.0 million under the revolving credit facility. During the nine months ended September 30, 2018, the Company had $80.1 million of mortgage repayments, paid $50.0 million to partially redeem shares of its Series B Preferred Stock, had $22.3 million of preferred and common stock distributions, had $5.2 million of payment for early extinguishment of debt costs, and $0.7 million of payments for debt financing costs, which was partially offset by a $75.0 million borrowing under a new term loan, and net borrowings of $47.0 million under the revolving credit facility.

Funds From Operations

Funds From Operations (“FFO”) is a widely recognized supplemental non-GAAP measure utilized to evaluate the financial performance of a REIT. The Company presents FFO in accordance with the definition adopted by the National Association of Real Estate Investment Trusts (“NAREIT”). NAREIT generally defines FFO as net income attributable to common shareholders (determined in accordance with GAAP), excluding gains (losses) from sales of real estate properties, impairment provisions on real estate properties, plus real estate related depreciation and amortization, and adjustments for partnerships and joint ventures to reflect FFO on the same basis. The Company considers FFO to be an appropriate measure of its financial performance because it captures features particular to real estate performance by recognizing that real estate generally appreciates over time or maintains residual value to a much greater extent than other depreciable assets.

The Company also considers Operating Funds From Operations (“Operating FFO”) to be an additional meaningful financial measure of financial performance because it excludes items the Company does not believe are indicative of its core operating performance, such as non-capitalized acquisition pursuit costs, amounts relating to early extinguishment of debt and preferred stock redemption costs, management transition costs and certain redevelopment costs. The Company believes Operating FFO further assists in comparing the Company’s performance across reporting periods on a consistent basis by excluding such items.

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FFO and Operating FFO should be reviewed with net income attributable to common shareholders, the most directly comparable GAAP financial measure, when trying to understand the Company’s operating performanc e. FFO and Operating FFO do not represent cash generated from operating activities and should not be considered as an alternative to net income attributable to common shareholders or to cash flow from operating activities. The Company’s computations of FFO and Operating FFO may differ from the computations utilized by other REITs and, accordingly, may not by comparable to such REITs.

A reconciliation of net income (loss) attributable to common shareholders to FFO and Operating FFO for the three and nine months ended September 30, 2019 and 2018 is as follows:

|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Net income (loss) attributable to common shareholders |  | $ | 92,000 |  |  | $ | 3,472,000 |  |  | $ | 2,981,000 |  |  | $ | (12,413,000 | )
Real estate depreciation and amortization |  |  | 10,501,000 |  |  |  | 9,601,000 |  |  |  | 30,884,000 |  |  |  | 30,095,000 |
Limited partners' interest |  |  | 1,000 |  |  |  | 19,000 |  |  |  | 20,000 |  |  |  | (41,000 | )
Gain on sales |  |  | — |  |  |  | (4,864,000 | ) |  |  | (2,942,000 | ) |  |  | (4,864,000 | )
Impairment (reversal)/charges |  |  | — |  |  |  | (707,000 | ) |  |  | — |  |  |  | 20,689,000 |
Consolidated minority interests: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Share of income |  |  | 166,000 |  |  |  | 126,000 |  |  |  | 415,000 |  |  |  | 394,000 |
Share of FFO |  |  | (130,000 | ) |  |  | (99,000 | ) |  |  | (316,000 | ) |  |  | (343,000 | )
FFO applicable to diluted common shares |  |  | 10,630,000 |  |  |  | 7,548,000 |  |  |  | 31,042,000 |  |  |  | 33,517,000 |
Preferred stock redemption costs |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 3,507,000 |
Financing costs (a) |  |  | — |  |  |  | 4,829,000 |  |  |  | — |  |  |  | 4,829,000 |
Operating FFO applicable to diluted common shares |  | $ | 10,630,000 |  |  | $ | 12,377,000 |  |  | $ | 31,042,000 |  |  | $ | 41,853,000 |
FFO per diluted common share |  | $ | 0.12 |  |  | $ | 0.08 |  |  | $ | 0.34 |  |  | $ | 0.36 |
Operating FFO per diluted common share |  | $ | 0.12 |  |  | $ | 0.13 |  |  | $ | 0.34 |  |  | $ | 0.45 |
Weighted average number of diluted common shares (b): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Common shares and equivalents |  |  | 90,521,000 |  |  |  | 92,961,000 |  |  |  | 90,636,000 |  |  |  | 92,179,000 |
OP Units |  |  | 544,000 |  |  |  | 469,000 |  |  |  | 550,000 |  |  |  | 388,000 |
|  |  | 91,065,000 |  |  |  | 93,430,000 |  |  |  | 91,186,000 |  |  |  | 92,567,000 |

| (a) | Represents early extinguishment of debt costs.

| (b) | The weighted average number of diluted common shares used to compute FFO and Operating FFO applicable to diluted common shares includes OP Units and unvested restricted shares/units that are excluded from the computation of diluted EPS.

Inflation

Inflation has been relatively low in recent years and has not had a significant detrimental impact on the Company’s results of operations. There have been mixed indications of an increase in inflation in the U.S. economy. If inflation rates increase, substantially all of the Company’s tenant leases contain provisions designed to partially mitigate the negative impact of inflation in the near term. Such lease provisions include clauses that require tenants to reimburse the Company for inflation-sensitive costs such as real estate taxes and many of the operating expenses it incurs. Significant inflation rate increases over a prolonged period of time may have a material adverse impact on the Company’s business.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

One of the principal market risks facing the Company is the risk of interest rate changes, primarily through its variable-rate revolving credit facility and term loans. The Company’s objectives with respect to interest rate risk are to limit the impact of interest rate changes on operations and cash flows, and to lower its overall borrowing costs. To achieve these objectives, the Company may borrow at either fixed rates or at variable rates and enter into derivative financial instruments, such as interest rate swaps, to mitigate its interest rate risk. The Company does not enter into derivative or interest rate transactions for speculative purposes. The Company is not directly subject to foreign currency risk.

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The Company has entered into forward interest rate swap agreements which convert the LIBOR rates to fixed rates for certain unsecured term loa ns. At September 30, 2019, the Company had $0.1 million included in deferred charges and other assets, net, in addition to $10.0 million included in accounts payable and accrued liabilities on the consolidated balance sheet relating to the fair value of th e interest rate swaps applicable to certain unsecured term loans.

At September 30, 2019, long-term debt consisted of a fixed-rate mortgage loan payable, a capital lease obligation, unsecured term loans, and the Company’s unsecured variable-rate credit facility. Excluding unamortized premiums and debt issuance costs, the average interest rate on the $477.6 million of fixed-rate debt outstanding was 3.7%, with maturities at various dates through 2050. The average interest rate on the $157.0 million of variable-rate debt outstanding, which consists of the unsecured revolving credit facility and a term loan, was 3.6%. With respect to the $157.0 million of variable-rate debt, if contractual interest rates either increase or decrease by 100 bps, the Company’s interest cost would increase or decrease respectively by approximately $1.6 million per annum.

With respect to the Company’s fixed rate mortgage notes and unsecured term loans, changes in interest rates generally do not affect the Company’s interest expense as these notes are at fixed rates for extended terms. Because the Company presently intends to hold its existing fixed-rate debt either to maturity or until the sale of the associated property, these fixed-rate notes pose an interest rate risk to the Company’s results of operations and its working capital position only upon the refinancing of that indebtedness. The Company’s possible risk is from increases in long-term interest rates that may occur as this may increase the cost of refinancing maturing fixed-rate debt. In addition, the Company may incur prepayment penalties or defeasance costs when prepaying or defeasing debt.

Item 4. Controls and Procedures

The Company maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), designed to ensure that information required to be disclosed in its filings under the Exchange Act is reported within the time periods specified in the rules and regulations of the Securities and Exchange Commission (“SEC”). In this regard, the Company has formed a Disclosure Committee currently comprising several of the Company’s executive officers as well as certain other employees with knowledge of information that may be considered in the SEC reporting process. The Committee has responsibility for the development and assessment of the financial and non-financial information to be included in the reports filed with the SEC, and assists the Company’s Chief Executive Officer and Chief Financial Officer in connection with their certifications contained in the Company’s SEC filings. The Committee meets regularly and reports to the Audit Committee on a quarterly or more frequent basis. The Company’s Chief Executive Officer and Chief Financial Officer have evaluated its disclosure controls and procedures as of September 30, 2019, and have concluded that such disclosure controls and procedures are effective.

During the three months ended September 30, 2019, there have been no changes in the Company’s internal controls over financial reporting or in other factors that have materially affected, or are reasonably likely to materially affect, these internal controls over financial reporting. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well-designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

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Part IIOther Information

Item 1. | Legal Proceedings

The Company is not presently involved in any litigation, nor, to its knowledge, is any litigation threatened against the Company or its subsidiaries, which is either not covered by the Company’s liability insurance, or, in management’s opinion, would result in a material adverse effect on the Company’s financial position or results of operations.

Item 1A. | Risk Factors

There were no material changes to the Risk Factors disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. | Defaults upon Senior Securities

None.

Item 4. | Mine Safety Disclosures

Not applicable

Item 5. | Other Information

None.

Item 6. | Exhibits

| Exhibit 10.1 | Amended and Restated Employment Agreement between Cedar Realty Trust, Inc. and Robin McBride Zeigler, dated effective as of April 1, 2019

| Exhibit 31.1 | Rule 13a-14(a) Certification of Chief Executive Officer

| Exhibit 31.2 | Rule 13a-14(a) Certification of Chief Financial Officer

| Exhibit 32.1 | Section 1350 Certification of Chief Executive Officer

| Exhibit 32.2 | Section 1350 Certification of Chief Financial Officer

| Exhibit 101.INS | XBRL Instance Document

| Exhibit 101.SCH | XBRL Taxonomy Extension Schema Document

| Exhibit 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document

| Exhibit 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document

| Exhibit 101.LAB | XBRL Taxonomy Extension Label Linkbase Document

| Exhibit 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document

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SIGNAT URES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

CEDAR REALTY TRUST, INC.

By: | /s/ BRUCE J. SCHANZER |  | By: | /s/ PHILIP R. MAYS
| Bruce J. Schanzer |  |  | Philip R. Mays
| President and Chief Executive Officer (Principal executive officer) |  |  | Executive Vice President, Chief Financial Officer and Treasurer
|  |  |  | (Principal financial officer)
| October 30, 2019 |  |  |

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