Bradley Real Estate reports 21 percent increase in 4TH-QTR FFO per share.

NORTHBROOK, Ill.--(BUSINESS WIRE)--Feb. 18, 1997--

Full-year FFO per share up 11 percent;

Comments on strategic progress, plans

Bradley Real Estate, Inc. (NYSE: BTR) today reported funds from operations (FFO) for the year of $30.3 million, or $1.72 per share, compared with $15.2 million, or $1.55 per share, in the prior year. This represents an increase in per share FFO of 11 percent over 1995. Net income increased to $27.2 million, or $1.54 per share, from $8.4 million, or 85 cents per share, for the prior year. Net income for 1996 includes a gain of $9.4 million on the sale of the company's ground lease in Minneapolis during the first quarter of 1996. Absent that gain, 1996 net income would have been $17.8 million, or $1.01 per share.

Weighted average shares outstanding were 17,619,546 for 1996 compared with 9,863,767 for the prior year. The increase in weighted average shares occurred primarily as a result of the issuance of 7.4 million shares upon the acquisition of Tucker Properties Corporation, which was completed in March 1996, and a 2.875-million-share offering of the company's stock, which was completed in early November 1996. Total assets at December 31, 1996, amounted to $502.3 million compared with $180.5 million at the end of the prior year.

Fourth-Quarter Results

Fourth-quarter FFO was $9.6 million, or 47 cents per share, compared with $4.4 million, or 39 cents per share, in the prior year's comparable quarter. The results represent a 21 percent increase in FFO per share over the prior period.

Net income for the period totaled $6.1 million, or 30 cents per share, compared with $2.6 million, or 23 cents per share, for the comparable period last year. Weighted average shares outstanding increased to 20,567,723 from 11,226,727 in the year-ago period.

Commenting on the results for the quarter, Thomas D'Arcy, president and chief executive officer, stated, "We had very productive 1996 and an active fourth quarter as we continued to aggressively implement our plan to establish Bradley as a dominant owner of grocery-focused retail centers operating in the Midwest. A key component of this plan is an aggressive acquisition program that targets for purchase approximately $150 million of Midwest grocery-anchored retail properties during 1997. As we reported last month, we are off to a positive start toward this goal with our recent purchase of four grocery-anchored centers for $25 million, at an initial cash yield of 10.9 percent. We remain encouraged by the number and quality of acquisition opportunities we continue to identify throughout our Midwest target markets."

D'Arcy continued, "In support of this program, during the fourth quarter we strengthened our capital position by raising $45 million in new equity, which will help fund our acquisition program while maintaining a strong and flexible capital structure. Although the increase in shares outstanding due to this offering will initially serve to slightly reduce our per share FFO, we expect that for the year the continued execution of our acquisition program will positively affect company operating results."

Operational Review

For the fourth quarter, property occupancy was 90 percent compared with 89 percent for the previous quarter. During the quarter the company signed 20 new leases totaling 91,000 square feet at an average rate of $7.68 per square foot. In addition, the company renewed 18 leases totaling 52,000 square feet at an average rate of $12.34 per square foot, a 7.7 percent increase over the prior period average rental rate. Subsequent to year-end, the company entered into a new lease with J.C. Penney to occupy 55,000 square feet at the company's Chicago Ridge, Illinois center. The property which was 75 percent leased when acquired last March as part of the Tucker transaction, is now 95 percent leased, according to the company.

Commenting on operations, D'Arcy said, "Although the retail leasing markets remain competitive, the 1 percent increase in occupancy is a healthy sign that our leasing efforts are resulting in completed transactions. We remain intensely focused on improving the performance of the existing portfolio and remain optimistic regarding the direction of occupancy levels, base rents and rental margins. We believe the composition of our portfolio will allow us to continue to enhance the cash flow from our existing asset base."

In addition to the regular quarterly earnings releases, Bradley Real Estate also makes available on a quarterly basis supplemental information that includes property- and corporate-level detail. This information is available upon request from the company.

The preceding information contains forward-looking statements of the company's plans, objectives and expectations, which are dependent upon a number of factors including no further weakness in the Midwestern United States retailing climate and the continuing availability of retail center acquisitions. Reference is made to the discussions under the captions "Risk Factors" in the company's October 29, 1996, Prospectus Supplement relating to its recent Common Stock Offering and in the company's 1995 Form 10-K report, which includes a discussion of certain other factors that could cause actual results to differ materially from those in forward-looking statements.

Bradley Real Estate, Inc. is the nation's oldest continuously qualified real estate investment trust (REIT) and has made 142 consecutive quarterly dividend payments. The company is a leading owner and operator of neighborhood and community shopping centers located in the Midwest . The company currently owns 35 properties aggregating 8 million square feet of rentable space.

To receive additional information on Bradley Real Estate free of charge via fax, dial 1-800-PRO-INFO and enter "BTR."

                          Bradley Real Estate Inc.
                      Consolidated Statement of Income
              (Dollars in thousands, except per share data)
                               (unaudited)

                                    Three
                                    Months                Year
                                    Ended                 Ended
                                   Dec. 31,              Dec. 31,
                                1996     1995         1996      1995
Income
 Rental income               $22,869   $9,708      $77,512   $36,405
 Other income                    331       26        1,327       167
                              23,200    9,734       78,839    36,572
Expenses:
 Operations,
  maintenance and
  management                   3,672    1,623      12,949     5,858
 Real estate taxes             4,724    2,346      16,787     8,726
 Mortgage and other
  interest                     3,744      879      13,404     4,705
 Administrative and
  general                      1,145      381       3,532     1,535
 Corporate office
  relocation                      --       --         409        --
 Write-off of deferred
  financing and
  acquisition costs               --       --         344        --
Depreciation and
  amortization                 3,713    1,904      13,286     7,317
                              16,998    7,133      60,711    28,141

Income before gain on sale
 of property                   6,202    2,601      18,128     8,431
Gain on sale of property          --       --       9,379        --
Income before allocation to
 minority interest             6,202    2,601      27,507     8,431
Income allocated to minority
 interest                        (92)      --        (285)       --
Net income                    $6,110   $2,601     $27,222    $8,431
Weighted average shares
 outstanding              20,567,723 11,226,727 17,619,546 9,863,767
Net income per share           $0.30    $0.23       $1.54     $0.85

Funds from operations:
Net income                    $6,110   $2,601     $27,222    $8,431
Net gain on sale of property      --       --      (9,379)       --
Depreciation and amortization of
 real estate assets, tenant
 improvements and leasing
 commissions                   3,506    1,787      12,502     6,818
Funds from operations         $9,616   $4,338     $30,345   $15,249
Write off of deferred
 financing costs                  --       --         251        --
Amortization of financing and
 non-real estate related
 costs                           207      117         784       499

Funds from operations, old
 definition                   $9,823   $4,505     $31,380   $15,748

Per share data:
 Funds from operations         $0.47    $0.39       $1.72     $1.55
 Funds from operations, old
  definition                   $0.48    $0.40       $1.78     $1.60


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                     Bradley Real Estate Inc.
                    Consolidated Balance Sheets
            (Dollars in thousands, except share data)
                          (unaudited)

                                       Dec. 31,   Dec. 31,
                                        1996        1995

     Assets
Real estate investments, at cost      $490,133    $189,405
Accumulated depreciation
 and amortization                      (30,670)    (27,591)
Net real estate investments            459,463     161,814

Real estate investments held for sale   10,285          --

Cash and cash equivalents                7,462         697
Rents and other receivables, net of
 allowances for doubtful accounts of
 $1,636 and $711, respectively           9,543       8,671
Unamortized buyout of contract, net      3,180       4,372
Deferred charges, net and other assets  12,351       4,991
                                      $502,284    $180,545

     Liabilities and Stockholders' Equity

Mortgage loans                         125,394      24,794
Line of credit                          63,500      14,600
Accounts payable, accrued expenses
 and other liabilities                  19,505       6,053
Total liabilities                      208,399      45,447

Minority interest                        4,160          --

Stock holders' equity:
  Shares of common stock, par value
    $.01 per share: authorized
    80,000,000 shares; issued and
    outstanding, 21,658,790 at Dec.
    30, 1996 and 11,230,313
    at Dec. 31, 1995                       217         112
Additional paid-in capital             298,875     148,407
Distributions in excess of
 accumulated earnings                   (9,367)    (13,421)
Total stockholders' equity             289,725     135,098
                                      $502,284    $180,545

CONTACT: Bradely Real Estate

Thomas P. D'Arcy

[phone]

OR

FINANCIAL RELATIONS BOARD:

Jenifer Estabrook

[phone]