Federated Sells Strawbridge's Cherry Hill Store to Pennsylvania Real Estate Investment Trust

Business Wire, June 5, 2006

CINCINNATI -- Federated Department Stores, Inc. (NYSE:FD) (NYSE Arca:FD) today announced it has sold the Strawbridge's department store in Cherry Hill Mall in Cherry Hill, NJ, to Pennsylvania Real Estate Investment Trust (PREIT). The Cherry Hill store (262,000 square feet, opened in 1961) is among 80 duplicate locations nationwide Federated previously announced for divestiture as a result of its acquisition of The May Department Stores Company. With this sale, Federated now has announced buyers for 56 of its 80 duplicate locations.

A clearance sale has been completed at the Strawbridge's in Cherry Hill. Macy's continues to serve customers in the mall with its existing store.

Terms of the sale were not disclosed. Federated said proceeds from this transaction will be included in the $400 million to $500 million of after-tax proceeds expected from the sale of duplicate stores nationwide, as previously announced.

(NOTE: a complete list of announced divestiture stores is posted in the "Federated-May Integration" section of the company's corporate Website - www.fds.com.).

Federated, with corporate offices in Cincinnati and New York, is one of the nation's premier retailers, with fiscal 2006 sales expected to be more than $27 billion. Federated operates more than 850 department stores in 45 states, the District of Columbia, Guam and Puerto Rico under the names of Macy's, Bloomingdale's, Famous-Barr, Filene's, Foley's, Hecht's, Kaufmann's, L.S. Ayres, Marshall Field's, Meier & Frank, Robinsons-May, Strawbridge's and The Jones Store. The company also operates macys.com and Bloomingdale's By Mail.

All statements in this press release that are not statements of historical fact are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of Federated's management and are subject to significant risks and uncertainties. Actual results could differ materially from those expressed in or implied by the forward-looking statements contained in this release because of a variety of factors, including conditions to, or changes in the timing of, proposed transactions, the risk the company will not be able to divest the assets that its intends to divest or that the amounts realized in connection with the divestitures are less than anticipated, the risk that the company is not able to realize cost synergies expected from the merger with May Company or is not able to integrate the May Company as anticipated, prevailing interest rates, competitive pressures from specialty stores, general merchandise stores, manufacturers' outlets, off-price and discount stores, new and established forms of home shopping (including the Internet, mail-order catalogs and television) and general consumer spending levels, including the impact of the availability and level of consumer debt, the effect of weather and other factors identified in documents filed by the company with the Securities and Exchange Commission.

(NOTE: Additional information on Federated, including past news releases, is available at www.fds.com/pressroom.)