Investment Strategy

Rather than focus on a particular type of real estate asset or a specific geographic sector, the investments of Winthrop Realty Trust are based on our assessment that a potential investment is significantly undervalued or presents an opportunity to outperform the marketplace. We make investments in assets which have under performed and which, through an infusion of capital and improved management, an appropriate return on investment can be realized. Additionally, we create joint venture platforms with local real estate partners to combine their specific expertise with our approach to the investment of capital in order to mutually benefit through the growth of their platform. In this respect, with certain limitations, we will continue to seek to invest in, or acquire, most types of real estate assets or securities.

Other than the requirements imposed to maintain our REIT status or other regulatory restrictions, our investment decisions will not be materially affected by the nature of an investment or where that investment falls in an entity's capital structure. We will continue to acquire entities that own real estate, invest in the equity of a real estate asset directly or through a venture, acquire preferred equity, and invest in mezzanine debt or first mortgage debt of a real estate asset to the extent we believe the ownership of the underlying real estate is consistent with our investment strategy. In general, it is not expected that we will invest in an entity in which we do not own 100% of the equity unless we control, have the means to acquire control, or have a mechanism in place to exit the investment for a price consistent with fair market value. In order to fund future acquisitions, we will utilize our cash reserves, obtain debt financing and/or sell additional equity.

In view of the foregoing, our near-term investment strategy will be to identify and invest in discrete real estate investments consistent with these criteria. As appropriate investment opportunities arise, we will aggressively pursue such opportunities. For the long-term, as investments mature in value to the point at which we are unlikely to achieve better than a market return on the then enhanced value, it is likely we will exit the investment and seek to redeploy the capital to higher yielding opportunities.

We invite you to read the letter from Chairman and CEO, Michael Ashner in the "Letters to Shareholders" section.