- Stabilized Property Occupancy Remains 96% -

- Company Reiterates Full-Year Guidance -

PORT WASHINGTON, N.Y., Oct. 29 /PRNewswire-FirstCall/ --Cedar Shopping Centers, Inc. (NYSE: CDR) today reported its financial results for the quarter ended September 30, 2008.

Highlights

• Revenues for the quarter ended September 30, 2008 increased 14.5% to $43.3 million from $37.8 million for the comparable quarter of 2007. Revenues for the nine months ended September 30, 2008 were $129.9 million as compared to $111.0 million for the nine months ended September 30, 2007, an increase of 17.0%.

• Funds from Operations ('FFO') for the quarter were $14.4 million, or $0.31 per share/OP Unit as compared to $14.2 million, or $0.31 per share/OP Unit for the comparable quarter of 2007. FFO for the nine months ended September 30, 2008 was $42.6 million, or $0.92 per share/OP Unit as compared to $40.6 million, or $0.88 per share/OP Unit for the nine months ended September 30, 2007.

• Net income applicable to common shareholders was $3.3 million ($0.07 per share) for the quarter ended September 30, 2008 as compared to $3.9 million ($0.09 per share) for the comparable quarter of 2007.

• Net cash provided by operating activities was $39.2 million for the nine months ended September 30, 2008 as compared to $36.8 for the comparable period in 2007.

• Occupancy for the Company's stabilized portfolio as of September 30, 2008 was approximately 96% while total portfolio occupancy, including development and redevelopment properties, was approximately 92%.

Leo Ullman, Cedar's CEO, stated, 'Our third quarter 2008 results again confirm the strength of our operations and continued execution of our business plan in this uncertain financial and economic environment. We have been able to maintain 96% occupancy levels in our portfolio due to the high percentage of strong performing supermarket anchor tenants with long-term leases. We believe our solid balance sheet and prudent approach to our operations, developments and finances, along with the continued financial strength of our tenants, place the Company in a strong position in the current economic environment. We remain careful and risk averse in all aspects of our operations and we will continue to be vigilant, as always, as we seek enhancement of shareholder value.'

Financial and Operating Results

Total revenues for the quarter ended September 30, 2008 increased 14.5% to $43.3 million from $37.8 million for the third quarter ended September 30, 2007. Total revenues for the nine months ended September 30, 2008 were $129.9 million as compared to $111.0 million for the nine months ended September 30, 2007, an increase of 17.0%.

Net income applicable to common shareholders was $3.3 million, or $0.07 per share, for the quarter ended September 30, 2008, as compared to $3.9 million, or $0.09 per share, for the quarter ended September 30, 2007. Net income for the quarter ended September 30, 2008 includes an expense of $0.3 million, or $0.01 per share, for a mark-to-market adjustment on the Company's deferred compensation restricted stock liability, as compared to a mark-to-market positive adjustment of $0.1 million for the quarter ended September 30, 2007. Net income applicable to common shareholders was $7.6 million, or $0.17 per share, for the nine months ended September 30, 2008 as compared to $10.5 million, or $0.24 per share, for the nine months ended September 30, 2007.

FFO was $14.4 million, or $0.31 per share/OP Unit for the quarter ended September 30, 2008, as compared to $14.2 million, or $0.31 per share/OP Unit for the quarter ended September 30, 2007. FFO for the third quarter of this year when compared to the third quarter of 2007 reflects a negative difference of $0.4 million for the mark-to-market adjustment on the Company's deferred compensation restricted stock liability. FFO for the third quarter of this year also reflects a reduction of approximately $0.02 per share/OP Unit from the contribution by the Company of nine properties to a joint venture with Homburg Invest Inc. that closed late in the fourth quarter 2007 (this transaction had a minor effect on net income). Such reductions in FFO were partially offset by the acquisition in March 2008 of joint venture interests of approximately 75% in four Pennsylvania supermarket-anchored properties from affiliates of Kimco Realty Corporation.

FFO was $42.6 million, or $0.92 per share/OP Unit, for the nine months ended September 30, 2008, as compared to $40.6 million, or $0.88 per share/OP Unit, for the nine months ended September 30, 2007. A reconciliation of net income applicable to common shareholders to FFO is contained in the table accompanying this release.

Net cash flows provided by operating activities were $39.2 million for the nine months ended September 30, 2008 as compared to $36.8 million for the corresponding period of 2007.

Same Property Results

The Company owned 105 properties throughout both the third quarters of 2008 and 2007. Same property net operating income was $27.5 million in the third quarter of 2008 as compared to $27.9 million in the third quarter of 2007. The overall $384,000 (or 1.4%) decrease reflects principally the reduction of expense recoveries and increase in bad debt expense (an expense which is non-recoverable from tenants) from the very favorable levels achieved in the third quarter of 2007 where the Company obtained the first substantial benefits of electronic billing system upgrades installed in 2006 and 2007. In the third quarter of 2007, the Company recovered 77% of billable expenses as compared to 74% in the third quarter of 2008; in the third quarter of 2007, the Company's bad debt expense was 0.2% of total revenues as compared to 0.9% of total revenues in the third quarter of 2008.

Balance Sheet and Capital Position

Total assets were $1.67 billion at September 30, 2008 and $1.60 billion at December 31, 2007. The Company had total debt outstanding of $957.6 million at September 30, 2008 as compared to $851.5 million at December 31, 2007. It had $71.1 million available under its secured and unsecured revolving credit facilities and $6.0 million in available cash at September 30, 2008. The Company implemented a new cash management system in the second quarter pursuant to which the Company was able to reduce its cash balance by approximately $13 million and pay down its stabilized property credit facility by a corresponding amount. At September 30, 2008, the Company's fixed-rate debt was approximately 67% of its total indebtedness, with a weighted average remaining term of 6.3 years and a weighted average interest rate of 5.7%.

The Company has an announced development pipeline of approximately $276 million that it expects to begin to put into service over the next 18 to 24 months. As of September 30, 2008, the Company had spent approximately $141 million of the estimated total project costs of the announced pipeline. It expects to fund the remaining estimated balance of construction development costs with borrowings under its stabilized property credit facility, its recently-completed development property credit facility for construction/development projects (see below), borrowings under property-specific construction financing arrangements, excess proceeds from certain financings and refinancings, property sales proceeds and/or funds from joint venture arrangements.

In June 2008, the Company entered into a $150 million development property credit facility that the Company expects to use to fund a significant amount of its development activities in 2008 and subsequent years. In September 2008, the Company entered into a $77.7 million property-specific construction facility for its joint venture development project in Pottsgrove, Pennsylvania. Through September 30, 2008 the Company had borrowed $61.3 million under these facilities to fund ongoing construction activities.

Leasing Activity

In the third quarter of 2008, the Company signed 27 renewal leases aggregating approximately 84,000 sq. ft. with an average increase in base rents of 7.4%, and 22 new leases aggregating approximately 94,000 sq. ft. with average base rent of $16.39 per sq. ft. At different properties, the Company had 16 terminated leases aggregating approximately 49,000 sq. ft. with average base rent of $14.41 per sq. ft.

Acquisitions Subsequent to the Third Quarter

On October 7 and 9, 2008, respectively, the Company purchased Metro Square in Owings Mills, Maryland and the remaining portion of the Smithfield Plaza Shopping Center in Smithfield, Virginia for an aggregate purchase price of approximately $25.1, at an average unleveraged cash cap rate of 8.0%.

Metro Square is a 72,000 sq. ft. community shopping center anchored by an approximate 59,000 sq. ft. Shoppers Food and Pharmacy, a member of the SuperValu supermarket group, with a lease extending to 2030. The purchase price for this property was $15.6 million financed primarily by assumption of an existing first mortgage loan of approximately $9.4 million. The center is shadow-anchored by an approximate 135,000 sq. ft. Target store.

The Smithfield Plaza Shopping Center is an 89,000 sq. ft. addition to the 45,000 sq. ft.