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As filed with the Securities and Exchange Commission, via EDGAR, on September 5, 2003

REGISTRATION NO. 333-104000

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

AMENDMENT NO. 3

TO

FORM S-11

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

American Financial Realty Trust

(Exact name of Registrant as specified in its Governing Instruments)

1725 The Fairway, Jenkintown, Pennsylvania 19046

(215) 887-2280

(Address, including Zip Code, and Telephone Number, including Area Code, of Registrant’s Principal Executive Offices)

Edward J. Matey Jr., Esquire

1725 The Fairway

Jenkintown, Pennsylvania 19046

(215) 887-2280

(Name, Address, including Zip Code, and Telephone Number, including Area Code, of Agent for Service)

with a copy to:

Approximate date of commencement of the proposed sale to the public: As soon as practicable after this registration statement becomes effective.

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering:  ¨                 

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering:  ¨                 

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering:  ¨                 

If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box:  ¨

CALCULATION OF REGISTRATION FEE

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

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The information in this prospectus is not complete and may be changed or supplemented. The securities described in this prospectus cannot be sold until the registration statement that we have filed to cover the securities has become effective under the rules of the Securities and Exchange Commission. This prospectus is not an offer to sell the securities, nor is it a solicitation of an offer to buy the securities, in any state where an offer or sale of the securities is not permitted.

Subject to Completion dated September 5, 2003

PROSPECTUS

46,543,974 Common Shares

This prospectus relates to up to 46,543,974 common shares of beneficial interest of American Financial Realty Trust that the selling shareholders named in this prospectus may offer for sale from time to time. We are registering the common shares to provide the selling shareholders with registered securities, but this prospectus does not necessarily mean that the selling shareholders will offer or sell the shares. The selling shareholders named in this prospectus either currently own the common shares they are offering, or may acquire these common shares by converting units of limited partnership interest in our operating partnership, First States Group, L.P., into common shares. These units of limited partnership interest in our operating partnership may be converted by the selling shareholders into common shares at any time in accordance with our operating partnership’s partnership agreement. We are filing the registration statement of which this prospectus is a part pursuant to contractual obligations. We will not receive any of the proceeds from the sale of any common shares by the selling shareholders, but will incur expenses in connection with the offering.

The selling shareholders from time to time may offer and sell the shares held by them directly or through agents or broker-dealers on terms to be determined at the time of sale. These sales may be made on the New York Stock Exchange or other exchanges on which our common shares are then traded, in the over-the-counter market, in negotiated transactions or otherwise at prices and at terms then prevailing or at prices related to the then current market prices or at prices otherwise negotiated. To the extent required, the names of any agent or broker-dealer and applicable commissions or discounts and any other required information with respect to any particular offer will be set forth in a prospectus supplement which will accompany this prospectus. A prospectus supplement also may add, update or change information contained in this prospectus.

Certain selling shareholders named in this prospectus have agreed, subject to certain exceptions, not to sell the shares they are offering for 180 days after the date of the prospectus relating to our initial public offering, which was June 24, 2003. Lock-up agreements relating to 40,565,241 common shares, and 2,555,656 common shares that are issuable upon conversion of an equal number of units of our operating partnership, to be offered by selling shareholders named in this prospectus expired on August 8, 2003. See “Registration Rights and Lock-Up Agreements” beginning on page 146.

Our common shares trade on the New York Stock Exchange under the symbol “AFR.” The last reported sale price on September 4, 2003 was $14.51 per share.

See “ Risk Factors” beginning on page 18 of this prospectus for certain risk factors relevant to an investment in our common shares, including, among others:

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is September     , 2003.

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You should rely only on the information contained in this prospectus or to which we have referred you. We have not authorized anyone to provide you with information that is different. This prospectus may only be used where it is legal to sell these securities. The information in this prospectus may only be accurate on the date of this prospectus.

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SUMMARY

The following summary highlights information contained elsewhere in this prospectus. You should read the entire prospectus, including “Risk Factors,” before making a decision to invest in our common shares. In this prospectus, unless the context suggests otherwise, references to “the company,” “we,” “us” and “our” mean American Financial Realty Trust, including our operating partnership and other subsidiaries. Certain terms used in this prospectus are defined in the glossary beginning on page 188.

Our Company

We are a self-managed, self-administered REIT and are the only public REIT focused primarily on acquiring and operating properties leased to regulated financial institutions. We were formed in Maryland in May 2002, commenced operations on September 10, 2002 and completed an initial public offering of our common shares on June 30, 2003. As banks continue to divest their corporate real estate, we believe that our contractual relationships, our growing visibility within the banking industry and our flexible acquisition and lease structures position us for continued growth. We seek to lease our properties to banks and other financial institutions using long-term net leases with terms ranging from 10 to 20 years, resulting in stable risk-adjusted returns on our capital.

Our innovative approach is designed to provide banks and other financial institutions with operational flexibility and the benefits of reduced real estate exposure. We seek to become the preferred landlord of leading banks and other financial institutions through the development of mutually beneficial relationships and by offering flexible acquisition structures and lease terms. We believe that our recent transactions with Bank of America, N.A., Wachovia Bank, N.A., KeyBank, N.A. and AmSouth Bank demonstrate our ability to cultivate mutually beneficial relationships with leading financial institutions.

We acquire both core and underutilized real estate from banks through our three acquisition structures:

Sale Leaseback Transactions.    Under this structure, we acquire properties and lease them back to the seller pursuant to a triple net or bond net lease, under which rent is based largely upon the property’s purchase price and the tenant’s credit;

Formulated Price Contracts.    Pursuant to these agreements, we acquire or assume leasehold interests in the surplus bank branches of a financial institution at a formulated price. This price is typically based on the fair market value of the property as determined through an independent appraisal process, which values the property based on its highest and best use and its alternative use, and then applies a negotiated discount; and

Specifically Tailored Transactions.    These transactions, which typically relate to the acquisition of office buildings and often include a partial sale leaseback with the seller, apply leasing and pricing structures that we tailor to meet the seller’s specific needs.

Of the 435 properties that we owned as of June 30, 2003, we acquired 202 properties containing approximately 8.1 million rentable square feet in sale leaseback transactions, 145 properties containing approximately 673,000 rentable square feet under formulated price contracts, and 88 properties containing approximately 6.6 million rentable square feet in specifically tailored transactions.

Of the 158 properties that we anticipate acquiring pursuant to our acquisitions under contract as of June 30, 2003, we will acquire 129 properties containing approximately 636,000 rentable square feet in sale leaseback transactions, 27 properties containing approximately 205,000 rentable square feet under formulated price contracts, and 2 properties containing approximately 291,000 rentable square feet in specifically tailored transactions.

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We completed a private placement of common shares in September 2002, in which we raised net proceeds of approximately $378.6 million. At that time, we acquired our initial properties in our formation transactions, which are described below under “Our Business and Properties—Our Formation.” On June 30, 2003, we completed an initial public offering of our common shares pursuant to which we sold 64,142,500 common shares at $12.50 per share, and raised an aggregate of approximately $741.5 million in net proceeds, after deducting underwriters’ discounts and commissions and offering expenses. See “Our Business and Properties—Our Initial Public Offering.” We used approximately $370.0 million of these proceeds to fund the equity portion of the purchase price of a portfolio of 158 office buildings, consisting of 8.1 million rentable square feet, which were sold to us by Bank of America, N.A. for an aggregate purchase price of approximately $770.0 million.

As of June 30, 2003, our portfolio consisted of 222 bank branches and 213 office buildings, containing an aggregate of approximately 15.5 million rentable square feet. As of June 30, 2003, we had entered into contracts to acquire approximately $184.9 million of properties, including three office buildings and 155 bank branches containing an aggregate of approximately 1.1 million rentable square feet, most of which we anticipate closing by the end of the third quarter of 2003.

Until September 10, 2002, when we acquired our initial properties and operating companies through the formation transactions, we had no historical operations. Our executive offices are located at 1725 The Fairway, Jenkintown, Pennsylvania 19046. Our telephone number is (215) 887-2280.

Market Opportunity

According to the Federal Deposit Insurance Corporation, or FDIC, commercial banks and savings institutions that are FDIC-insured owned approximately $92.5 billion in operating real estate assets as of December 31, 2002. We have identified two major trends in the banking industry. First, we believe that banks and other financial institutions will continue to sell properties, lease some or all of the space back from the acquiror and reinvest the proceeds from these sales into their primary operating businesses. Second, we anticipate that continued consolidation within the banking industry will create an environment in which larger banks will sell surplus bank branches that other banks will seek to lease as they expand their market presence.

Investment Considerations

We believe that our business strategy and operating model distinguish us from developers and other owners, operators and acquirors of real estate in a number of ways, including:

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Summary Risk Factors

You should carefully consider the matters discussed in the section “Risk Factors” beginning on page 18 prior to deciding whether to invest in our common shares. Some of these risks include:

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Our Properties

As of June 30, 2003, we owned or held leasehold interests in 435 properties located in 25 states and Washington, D.C. containing an aggregate of approximately 15.5 million rentable square feet. As of that date, the aggregate 2003 contractual rent expected from our properties was approximately 157.9 million. The following table describes our portfolio as of June 30, 2003:

Our Portfolio as of June 30, 2003

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The following table presents information as of June 30, 2003, regarding the acquisitions we have completed, including the properties we acquired in our formation transactions and excluding 13 properties that we have sold:

Completed Transactions

Included in the completed transactions above is our acquisition on June 30, 2003 from Bank of America, N.A. of a portfolio of 27 large office buildings and 131 small office buildings containing an aggregate of approximately 8.1 million rentable square feet. The aggregate purchase price for the properties was approximately $770.0 million, approximately $370.0 million of which we funded using a portion of the proceeds from our initial public offering, with the remainder financed through a bridge loan in the amount of $400 million that we obtained from German American Capital Corporation. We currently expect that three of the properties will not be occupied by Bank of America, N.A. by June 30, 2004. If we are unable to lease these three properties to other financial institutions, we will attempt to sell them. These properties represent approximately 2.7% of the aggregate rentable square feet in the portfolio. Bank of America, N.A. has initially leased an aggregate of approximately 64.7% of the rentable square feet in this portfolio with an initial lease term of 20 years. Excluding the three unoccupied sites, the Bank of America, N.A. lease constitutes approximately 67.7% of the remaining rentable square feet for the initial 20 year lease term. Bank of America, N.A. has the option to renew this lease for up to six successive five year terms. In the case of a renewal, the rent will be the fair market rental value of the premises, as determined in accordance with the lease. Bank of America, N.A.’s obligations under this lease are unconditionally guaranteed by its parent, Bank of America Corporation.

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In addition to the portion of the premises subject to the 20 year lease, Bank of America, N.A. currently occupies approximately 847,000 rentable square feet that it may rent at a reduced rate for up to 12 months after the commencement of the lease. Bank of America, N.A. is required to notify us, within 12 months after the commencement of the 20 year lease, whether it intends to vacate this square footage or add it to the lease at a fair market rate or at the rate established by the 20 year lease, depending on the length of the term selected. Approximately 10.1% of the rentable square feet in the portfolio is currently leased to third parties. Bank of America will pay us approximately $44.0 million in annual base rent under the 20 year lease for this portfolio, plus their portion of the operating expenses associated with the leased space, excluding the 847,000 rentable square feet that is occupied on a reduced basis.

We have also engaged in the following financing transactions:

On June 30, 2003, we closed this bridge loan in the amount of $400 million. The bridge loan accrues interest at a variable rate equal to LIBOR plus 1.52%, is secured by a first lien mortgage and an assignment of rents and leases on the properties and matures on December 31, 2003.

The permanent financing will be for up to $440 million, accrue interest at a fixed rate based on U.S. Treasury bonds plus a spread and be secured by a first lien mortgage and an assignment of rents and leases on the properties. The term sheet attached to the conditional commitment contemplates a 10 year

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term, fixed-rate interest at the 10 year U.S. Treasury bond rate plus 1.60% (determined at the time of closing or earlier rate lock), 119 equal monthly payments of principal and interest calculated using 30 year amortization and a balloon payment for unamortized principal at maturity. We have agreed to work with German American Capital Corporation in good faith prior to closing the permanent financing to consider alternative structures, including the possibility of all or a portion of the permanent refinancing having a fixed rate for a 20 year term.

We anticipate that we will obtain permanent financing to replace the bridge loan from German American Capital Corporation or an affiliate of Deutsche Bank Securities Inc.; however, if we refinance the bridge loan other than with German American Capital Corporation or an affiliate of Deutsche Bank Securities Inc., we must pay German American Capital Corporation a bridge loan exit fee equal to 1.50% multiplied by the permanent loan amount.

Acquisitions Under Contract

As of June 30, 2003, we have entered into contracts to complete acquisitions having an aggregate transaction value of approximately $184.9 million, pursuant to which we would acquire three office buildings containing approximately 321,000 rentable square feet and 155 bank branches containing approximately 811,000 rentable square feet. Completion of these acquisitions is subject to customary conditions, including satisfactory completion by us of our due diligence investigation, acceptable environmental status and receipt of clear title to the properties. We cannot assure you that we will be able to complete any of the acquisitions that we have under contract or that the terms we have negotiated will not change.

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The following table presents information regarding the properties that we have under contract as of June 30, 2003:

Acquisitions Under Contract as of June 30, 2003 

The following table presents our portfolio as of June 30, 2003 and assumes the closing of all of our acquisitions under contract. As of June 30, 2003, the aggregate 2003 contractual rent expected from these properties, including acquisitions under contract, was approximately $175.2 million.

Our Portfolio Including Acquisitions Under Contract

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Private Placement, Formation Transactions and Initial Public Offering

We sold 40,263,441 common shares on September 10, 2002, in a private placement, and completed the sale of an additional 501,800 common shares on October 7, 2002 pursuant to the exercise by Friedman, Billings, Ramsey & Co., Inc. of its option to purchase additional shares. These sales resulted in aggregate net proceeds of approximately $378.6 million. On September 10, 2002, in our formation transactions, we acquired from our predecessor entities and other related parties 87 bank branches and six office buildings containing approximately 1.5 million rentable square feet. We also acquired American Financial Resources Group, Inc., or AFRG, Strategic Alliance Realty Group, LLC and several other affiliated entities in order to obtain the capacity to provide our properties with asset management, leasing, property management and accounting and finance services. In connection with these transactions, we assumed contracts and letters of intent to purchase additional properties, subject to satisfactory completion of our due diligence, from financial institutions such as Bank of America, N.A., KeyBank, N.A. and Wachovia Bank, N.A., having a potential aggregate gross purchase price of approximately $256.0 million. The aggregate purchase price for the 93 properties, the acquired entities and assumed contracts and letters of intent was approximately $230.5 million.

In addition, on June 30, 2003, we sold 64,142,500 common shares in an underwritten initial public offering at $12.50 per share. In connection with this offering, we received proceeds of approximately $741.5 million, after deducting underwriters’ discounts and commissions and offering expenses. In addition, in connection with our initial public offering, a selling shareholder also sold 200,000 common shares.

Conflicts of Interest

Some of our executives and trustees have interests that may conflict with our interests and result in them receiving personal benefits from this offering. Our executives have been granted restricted common shares that will be effective upon completion of this offering. Nicholas S. Schorsch, our President and Chief Executive Officer, Jeffrey C. Kahn, our Senior Vice President—Acquisitions and Dispositions, and Shelley D. Schorsch, our Senior Vice President—Corporate Affairs and the spouse of Nicholas S. Schorsch, all own interests in First States Wilmington, L.P., which owns the Three Beaver Valley Road property in Wilmington, Delaware. We hold an option to acquire this property, which we intend to exercise during the third quarter of 2003 using proceeds of this offering. The exercise price of this option is approximately $50.4 million. The ultimate determination of whether to exercise this option will be made by members of our board of trustees who do not have any interest in First States Wilmington, L.P. These same executive officers and trustees also own a majority of the 11% minority interest in First States Partners II, L.P., which owns our 123 South Broad Street property.

Our Structure

Through our wholly owned subsidiary, First States Group, LLC, we are the sole general partner of our operating partnership, First States Group, L.P. We own the general partnership interest and limited partnership units of our operating partnership representing approximately 96.0% of the total partnership interests as of June 30, 2003, including the 0.5% general partnership interest. The remaining holders of limited partnership units may convert their units into common shares on a one-for-one basis, subject to adjustments for stock splits, dividends, recapitalizations and similar events. At our option, in lieu of issuing common shares upon conversion of units, we may redeem the units tendered for conversion for a cash amount equal to the value of the common shares. We expect that, when limited partnership unitholders elect to convert their units, we will typically issue common shares and not redeem the units for cash. Holders of units have received and will receive distributions equivalent to the dividends we pay to holders of our common shares. We conduct all of our business through our operating partnership, and hold all of our interests in properties in limited liability companies or limited partnerships that are wholly owned subsidiaries of our operating partnership, except that we own 89.0% of First States Partners II, L.P., which owns our 123 South Broad Street property. As the sole owner of the general partner of our operating partnership, we have the exclusive power to manage and conduct our operating partnership’s business, subject to the limitations described in the Amended and Restated Agreement of Limited Partnership of our operating partnership. See “Partnership Agreement” beginning on page 165.

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The following chart illustrates our structure:

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Registration Rights and Lock-Up Agreements

Resale Registration Statement

In connection with registration rights agreements we entered into in September 2002 with the purchasers of common shares in our September 2002 private placement and the holders of units of our operating partnership, we agreed to file the registration statement of which this prospectus is a part, referred to as the resale registration statement.

Lock-Up Agreements

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Selling Shareholders

This prospectus relates to up to 46,543,974 common shares that the selling shareholders named in this prospectus may offer for sale from time to time. The selling shareholders named in this prospectus either currently own the common shares they are offering, or may acquire these common shares upon the conversion of their units of limited partnership interest in our operating partnership, First States Group, L.P., into common shares.

Use of Proceeds

We will not receive any proceeds from the sale by the selling shareholders of the common shares being offered by this prospectus. We have agreed, however, to pay various expenses relating to registration of these common shares under applicable securities laws.

Dividend Policy and Distributions

We intend to distribute to our shareholders each year all or substantially all of our REIT taxable income so as to avoid paying corporate income tax and excise tax on our earnings and to qualify for the tax benefits accorded to REITs under the Internal Revenue Code of 1986, as amended. The actual amount and timing of distributions, however, will be at the discretion of our board of trustees and will depend upon actual results of operations and a number of other factors discussed in the section “Dividend Policy and Distributions” on page 48, including:

For the period from September 10, 2002 through December 31, 2002, we declared our initial dividend of $0.22 per common share, payable to shareholders of record on December 31, 2002. We distributed this dividend on January 20, 2003.

On March 21, 2003, we declared a dividend of $0.25 per common share, payable with respect to the quarter ended March 31, 2003, to shareholders of record on March 31, 2003. We distributed this dividend on April 17, 2003.

On May 21, 2003, we declared a dividend of $0.25 per common share, payable with respect to the quarter ending June 30, 2003, to shareholders of record on June 10, 2003. We distributed this dividend on  July 18, 2003.

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Summary Selected Financial Information

The summary selected financial information presented below under the captions “Operating Information” and “Balance Sheet Information” as of December 31, 2002 and for the period from September 10, 2002 to December 31, 2002 are derived from the consolidated financial statements of American Financial Realty Trust. The financial information as of December 31, 2001 and for the period January 1, 2002 to September 9, 2002 and for each of the years in the three year period ended December 31, 2001 are derived from the combined financial statements of our predecessor entities, which consisted of American Financial Resource Group, Inc. and its wholly owned subsidiaries, First States Management Corp., First States Properties, Inc., Strategic Alliance Realty LLC, First States Properties, L.P., First States Partners, L.P., Chester Court Realty, LP., Dresher Court Realty, L.P., First States Partners II, L.P., First States Partners III, L.P., First States Holdings, L.P., and the general partner of each of these partnerships, and which are deemed to be our predecessor entities for accounting purposes. These financial statements have been audited by KPMG LLP, our independent auditor. The summary selected financial information presented below as of June 30, 2003, and for the six month periods ended June 30, 2003 and 2002 are derived from the unaudited consolidated financial statements of American Financial Realty Trust and our predecessor entities, respectively, and include all adjustments, consisting of normal recurring adjustments, which we consider necessary for a fair presentation of our financial condition and results of operations as of such date and for such periods under generally accepted accounting principles. The consolidated balance sheets as of June 30, 2003 and December 31, 2002 and the combined balance sheet as of December 31, 2001, and the related consolidated statements of operations, shareholders’ equity and comprehensive income (loss) and cash flows for six month periods ended June 30, 2003 and 2002 and for the period from September 10, 2002 to December 31, 2002, and the related combined statements of operations, owners’ net investment and cash flows for the period January 1, 2002 to September 9, 2002 and for each of the years in the two year period ended December 31, 2001, and the report thereon, are included elsewhere in this prospectus. The summary selected financial information presented below as of and for the year ended December 31, 1998 is derived from the unaudited combined financial statements of our predecessor entities and includes adjustments, consisting of normal recurring adjustments, which we consider necessary for a fair presentation of our financial condition and results of operations as of such date and for such period under generally accepted accounting principles. The unaudited pro forma Balance Sheet Information of American Financial Realty Trust as of December 31, 2002 and the unaudited pro forma Operating Information for the six month period ended June 30, 2003 and the year ended December 31, 2002 reflects the historical financial information adjusted to give effect to recently completed transactions, including our initial public offering, and our acquisitions under contract.

The historical financial statements of our predecessor entities represent the combined financial condition and results of operations of the entities that previously owned our initial properties and operating companies, as well as several properties and an entity controlled by Nicholas S. Schorsch, our President, Chief Executive Officer and Vice Chairman of our board of trustees, or by his wife, Shelley D. Schorsch, our Senior Vice President—Corporate Affairs, that we did not acquire in connection with our formation transactions. See “Our Business and Properties—Our Formation.” In addition, the historical financial information for our predecessor entities included herein and set forth elsewhere in this prospectus reflects our predecessor entities’ corporate investment strategy. Historically, our predecessor entities often funded new acquisitions by selling properties, a strategy which we discontinued when we became a REIT. Accordingly, historical financial results are not indicative of our future performance. In addition, since the financial information presented below is only a summary and does not provide all of the information contained in our financial statements, including related notes, you should read “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the financial statements, including related notes and the Independent Auditors’ Report, which refers to the adoption of Statement of Financial Accounting Standards No.144, Accounting for the Impairment or Disposal of Long-Lived Assets and to the fact that the consolidated financial information for American Financial Realty Trust is presented on a different cost basis than that of the Predecessor and, therefore, is not comparable, and “Unaudited Pro Forma Consolidated Financial Information,” each contained elsewhere in this prospectus. Pro forma information has been compiled from historical financial and other information, but does not purport to represent what our financial position or results of operations actually would have been had the transactions occurred on the dates indicated, or to project our financial performance for any future period.

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