Winthrop Realty Trust (FUR)

2. Unaudited Pro Forma Consolidated Balance Sheet

The unaudited pro forma balance sheet as of September 30, 2004, is based on the historical balance sheet for the Company presented in its Quarterly Report on Form 10-Q as of September 30, 2004. Significant pro forma adjustments in the unaudited pro forma consolidated balance sheet include the following:

(a)          Adjustments to reflect the purchase of the Finova Properties for approximately $92.1 million, including closing costs and inclusive of the assumption of approximately $31.6 million of existing first mortgage debt on certain of the properties. This acquisition was funded from the proceeds of a $27 million loan as well as $33.5 million in net proceeds realized from the sale of the Park Plaza property in June 2004 previously reported on Form 8-K on July 2, 2004, which were being held by a qualified intermediary to enable First Union to acquire the properties in a 1031 Tax-Free exchange. The Company has allocated the purchase price to real estate and lease intangibles, based on their relative fair values.

(b)         Adjustments to reflect the purchase of the 5400 Westheimer Property. This property is considered real estate held for syndication. On January 3, 2005, Holding completed an equity offering which reduced the Company’s investment to investor loans receivable aggregating $1.3 million, a 1% general partner interest ($80,000) and a 7% limited partner interest ($562,000).