8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report Pursuant

to Section 13 OR 15(d) of The

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 7, 2019

LEXINGTON REALTY TRUST

(Exact name of registrant as specified in its charter)

Maryland	1-12386	13-3717318
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One Penn Plaza, Suite 4015, New York, New York	10119-4015
(Address of principal executive offices)	(Zip Code)

(212) 692-7200

(Registrant's telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Shares of beneficial interest, par value $0.0001 per share, classified as Common Stock	LXP	New York Stock Exchange
6.50% Series C Cumulative Convertible Preferred Stock, par value $0.0001 per share	LXPPRC	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 2.02. Results of Operations and Financial Condition.

On August 7, 2019, we issued a press release announcing our financial results for the quarter ended June 30, 2019. A copy of the press release is furnished herewith as part of Exhibit 99.1.

The information furnished pursuant to this “Item 2.02 - Results of Operations and Financial Condition”, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, which we refer to as the Exchange Act, or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated by reference into any filing made by us under the Exchange Act or Securities Act of 1933, as amended, which we refer to as the Securities Act, regardless of any general incorporation language in any such filing, except as shall be expressly set forth by specific reference in such a filing.

Item 7.01. Regulation FD Disclosure.

On August 7, 2019, we made available supplemental information, which we refer to as the “Quarterly Supplemental Information, Second Quarter 2019,” a copy of which is furnished herewith as Exhibit 99.1.

Also on August 7, 2019, our management discussed our financial results and certain aspects of our business plan on a conference call with analysts and investors. A transcript of the conference call is furnished herewith as Exhibit 99.2.

The information furnished pursuant to this “Item 7.01 - Regulation FD Disclosure”, including Exhibit 99.1 and Exhibit 99.2, shall not be deemed to be “filed” for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated by reference into any filing made by us under the Exchange Act or the Securities Act, regardless of any general incorporation language in any such filing, except as shall be expressly set forth by specific reference in such a filing. Information contained on our web site is not incorporated by reference into this Current Report on Form 8-K.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1	Quarterly Supplemental Information, Second Quarter 2019.
99.2	August 7, 2019 Conference Call Transcript.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Lexington Realty Trust
Date: August 7, 2019	By:	/s/ Beth Boulerice
		Beth Boulerice
		Chief Financial Officer

EX-99.1

Exhibit 99.1

  

LEXINGTON REALTY TRUST

QUARTERLY SUPPLEMENTAL INFORMATION

June 30, 2019

Table of Contents

Section	Page
Second Quarter 2019 Earnings Press Release	3
Portfolio Data
Investment / Capital Recycling Summary	14
Financing Summary	15
Leasing Summary	16
Other Revenue Data	18
Portfolio Detail by Asset Class	20
Portfolio Composition	21
Components of Net Asset Value	22
Portfolio Concentration	23
Tenant Industry Diversification	26
Top 15 Tenants	28
Lease Rollover Schedules	29
Property Leases and Vacancies	31
Select Credit Metrics Summary	40
Financial Covenants	41
Mortgages and Notes Payable	42
Debt Maturity Schedule	43
Selected Balance Sheet Account Data	44
Non-GAAP Measures – Definitions	45
Reconciliation of Non-GAAP Measures	47
Investor Information	51

This Quarterly Earnings Press Release and Quarterly Supplemental Information contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under the control of Lexington Realty Trust (“Lexington”), which may cause actual results, performance or achievements of Lexington and its subsidiaries to be materially different from the results, performance, or other expectations implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed under the headings “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in Lexington’s periodic reports filed with the Securities and Exchange Commission, including, but not limited to, risks related to: (1) the authorization of Lexington’s Board of Trustees of future dividend declarations, (2) Lexington’s ability to achieve its estimates of net income attributable to common shareholders and Adjusted Company FFO available to all equityholders and unitholders – diluted for the year ending December 31, 2019, (3) the successful consummation of any lease, acquisition, build-to-suit, disposition, financing or other transaction on the terms described herein or at all, (4) the failure to continue to qualify as a real estate investment trust, (5) changes in general business and economic conditions, including the impact of any new legislation, (6) competition, (7) increases in real estate construction costs, (8) changes in interest rates, (9) changes in accessibility of debt and equity capital markets, and (10) future impairment charges. Copies of the periodic reports Lexington files with the Securities and Exchange Commission are available on Lexington’s web site at www.lxp.com. Forward-looking statements, which are based on certain assumptions and describe Lexington’s future plans, strategies and expectations, are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects,” may,” “plans,” “predicts,” “will,” “will likely result,” “is optimistic,” “goal,” “objective” or similar expressions. Except as required by law, Lexington undertakes no obligation to revise those forward-looking statements to reflect events or circumstances after the occurrence of unanticipated events. Accordingly, there is no assurance that Lexington’s expectations will be realized.

LEXINGTON REALTY TRUST

TRADED: NYSE: LXP

ONE PENN PLAZA, SUITE 4015

NEW YORK, NY 10119-4015

FOR IMMEDIATE RELEASE

LEXINGTON REALTY TRUST REPORTS SECOND QUARTER 2019 RESULTS

New York, NY - August 7, 2019 - Lexington Realty Trust (“Lexington”) (NYSE:LXP), a real estate investment trust focused on single-tenant industrial real estate investments, today announced results for the second quarter ended June 30, 2019.

Second Quarter 2019 Highlights

• Recorded Net Income attributable to common shareholders of $21.7 million, or $0.09 per diluted common share.

• Generated Adjusted Company Funds From Operations available to all equityholders and unitholders - diluted (“Adjusted Company FFO”) of $48.3 million, or $0.20 per diluted common share.

• Disposed of five consolidated properties for a gross sales price of $41.0 million.

• Acquired six industrial properties for an aggregate cost of $202.0 million.

• Completed 1.1 million square feet of new leases and lease extensions.

Subsequent Events

• Extended the maturity of the $300.0 million term loan to January 2025 and swapped the LIBOR portion of the interest rate to obtain a current fixed rate of 2.732% per annum.

Adjusted Company FFO is a non-GAAP financial measure. It and certain other non-GAAP financial measures are defined and reconciled later in this press release.

T. Wilson Eglin, Chairman and Chief Executive Officer of Lexington Realty Trust, commented, “We had a productive second quarter of investment, sale, and leasing activity that drove positive results. Our overall portfolio leased increased from about 95% to almost 98% and our industrial exposure continued to improve representing nearly 74% of our portfolio based on gross book value at quarter end. We have been successful thus far in the execution of our stated business plan, and we will continue to work diligently to reduce our remaining non-core asset exposure while we add more high-quality industrial warehouse/distribution centers to our portfolio. As a result of our accomplishments in the first half of the year and our expectations going forward, including cost savings associated with our recently extended term loan, we are increasing Adjusted Company FFO guidance to a range of $0.76-$0.80 per diluted common share.”

3

FINANCIAL RESULTS

Revenues

For the quarter ended June 30, 2019, total gross revenues were $80.1 million, compared with total gross revenues of $105.7 million for the quarter ended June 30, 2018. The decrease was primarily attributable to property sales and lease expirations, partially offset by revenue generated from property acquisitions and new leases.

Net Income (Loss) Attributable to Common Shareholders

For the quarter ended June 30, 2019, net income attributable to common shareholders was $21.7 million, or $0.09 per diluted share, compared with a net loss attributable to common shareholders for the quarter ended June 30, 2018 of $(3.3) million, or $(0.01) per diluted share.

Adjusted Company FFO

For the quarter ended June 30, 2019, Lexington generated Adjusted Company FFO of $48.3 million, or $0.20 per diluted share, compared to Adjusted Company FFO for the quarter ended June 30, 2018 of $62.4 million, or $0.25 per diluted share.

Dividends/Distributions

As previously announced, during the second quarter of 2019, Lexington declared a regular quarterly common share/unit dividend/distribution for the quarter ended June 30, 2019 of $0.1025 per common share/unit, which was paid on July 15, 2019 to common shareholders/unitholders of record as of June 28, 2019. Lexington also declared a cash dividend of $0.8125 per share on its Series C Cumulative Convertible Preferred Stock (“Series C Preferred”) for the quarter ended June 30, 2019, which is expected to be paid on August 15, 2019 to Series C Preferred Shareholders of record as of July 31, 2019.

TRANSACTION ACTIVITY

ACQUISITION TRANSACTIONS

Property Type	Market	Sq. Ft.		Initial Basis ($000)		Approximate Lease Term (Yrs)
Industrial	Dallas, TX		510,440	$	28,201	4
Industrial	Spartanburg, SC		408,000		33,253	5
Industrial	Memphis, TN		927,742		49,395	5
Industrial	Memphis, TN		269,902		18,316	4
Industrial	Atlanta, GA		604,852		45,441	1
Industrial	Atlanta, GA		370,000		27,353	5
			3,090,936	$	201,959

The above properties were acquired at aggregate weighted-average GAAP and cash capitalization rates of 5.8% and 5.9%, respectively.

4

PROPERTY DISPOSITIONS⁽¹⁾    

Primary Tenant	Location	Property Type	Gross Disposition Price ($000)		Annualized Net Income(2) ($000)			Annualized NOI(2) ($000)			Month of Disposition	% Leased
Honeywell	Glendale, AZ	Office	$	26,500	$	1,319		$	2,014		April		100.0	%
Huntington Ingalls	Pascagoula, MS	Office		6,000		487			593		April		100.0	%
Vacant	Memphis, TN	Industrial		75		(100	)		(80	)	April		0.0	%
Safeway	Lawton, OK	Other		1,515		135			184		May		100.0	%
Vacant	Plymouth, IN	Industrial		6,938		(1,087	)		(833	)	May		0.0	%
			$	41,028	$	754		$	1,878

(1) In addition, a joint venture, in which Lexington has a 20% interest, disposed of an office property for $40.1 million and satisfied $30.0 million of non-recourse debt.

(2) Quarterly period prior to sale, annualized.

LEASING

	LEASE EXTENSIONS
	Location		Primary Tenant(1)	Prior Term	Lease Expiration Date	Sq. Ft.
	Industrial
1	Streetsboro	OH	L'Oreal	10/2019	10/2026		649,250
2	Lavonia	GA	TI Automotive	05/2020	05/2030		133,221
2	Total industrial lease extensions						782,471
	Office
1	Whippany	NJ	CAE	11/2021	11/2031		123,734
1	Total office lease extensions						123,734
3	Total lease extensions						906,205
	NEW LEASES
	Location				Lease Expiration Date	Sq. Ft.
	Industrial
1	Duncan	SC	Plastic Omnium		08/2022		221,833
1	Total industrial leases						221,833
4	TOTAL NEW AND EXTENDED LEASES						1,128,038

(1)       Leases greater than 10,000 square feet.

As of June 30, 2019, Lexington's portfolio was 97.7% leased.

BALANCE SHEET/CAPITAL MARKETS

In the second quarter of 2019, Lexington satisfied $15.2 million of consolidated non-recourse debt. Subsequent to June 30, 2019, Lexington satisfied an aggregate of $21.4 million of consolidated non-recourse debt.

During the second quarter of 2019, Lexington borrowed $55.0 million on its unsecured revolving credit facility. As of the date of this earnings release $75.0 million is outstanding on its unsecured revolving credit facility.

5

2019 EARNINGS GUIDANCE

Lexington now estimates that its net income attributable to common shareholders per diluted common share for the year ended December 31, 2019 will be within an expected range of $1.28 to $1.32.

Additionally, Lexington is increasing its Adjusted Company FFO guidance range for the year ended December 31, 2019 from $0.75 to $0.79 to $0.76 to $0.80 per diluted common share. This guidance is forward looking, excludes the impact of certain items and is based on current expectations.

SECOND QUARTER 2019 CONFERENCE CALL

Lexington will host a conference call today, August 7, 2019, at 8:30 a.m. Eastern Time, to discuss its results for the quarter ended June 30, 2019. Interested parties may participate in this conference call by dialing 1-844-825-9783 (U.S.), 1-412-317-5163 (International) or 1-855-669-9657 (Canada). A replay of the call will be available through November 7, 2019, at 1-877-344-7529 (U.S.), 1-412-317-0088 (International) or 1-855-669-9658 (Canada), pin code for all replay numbers is 10132918. A link to a live webcast of the conference call is available at www.lxp.com within the Investors section.

6

ABOUT LEXINGTON REALTY TRUST

Lexington Realty Trust (NYSE: LXP) is a publicly traded real estate investment trust (REIT) that owns a diversified portfolio of real estate assets consisting primarily of equity investments in single-tenant net-leased commercial properties across the United States. Lexington seeks to expand its industrial portfolio through build-to-suit transactions, sale-leaseback transactions and other transactions, including acquisitions. For more information, including Lexington's Quarterly Supplemental Information package, or to follow Lexington on social media, visit www.lxp.com.

Contact:

Investor or Media Inquiries for Lexington Realty Trust:

Heather Gentry, Senior Vice President of Investor Relations

Lexington Realty Trust

Phone: (212) 692-7200 E-mail: hgentry@lxp.com

This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under Lexington's control which may cause actual results, performance or achievements of Lexington to be materially different from the results, performance, or other expectations implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed under the headings “Management's Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in Lexington's periodic reports filed with the Securities and Exchange Commission, including risks related to: (1) the authorization by Lexington's Board of Trustees of future dividend declarations, (2) Lexington's ability to achieve its estimates of net income attributable to common shareholders and Adjusted Company FFO for the year ending December 31, 2019, (3) the successful consummation of any lease, acquisition, build-to-suit, disposition, financing or other transaction, (4) the failure to continue to qualify as a real estate investment trust, (5) changes in general business and economic conditions, including the impact of any legislation, (6) competition, (7) increases in real estate construction costs, (8) changes in interest rates, (9) changes in accessibility of debt and equity capital markets, and (10) future impairment charges. Copies of the periodic reports Lexington files with the Securities and Exchange Commission are available on Lexington's web site at www.lxp.com. Forward-looking statements, which are based on certain assumptions and describe Lexington's future plans, strategies and expectations, are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects”, “may,” “plans,” “predicts,” “will,” “will likely result,” “is optimistic,” “goal,” “objective” or similar expressions. Except as required by law, Lexington undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the occurrence of unanticipated events. Accordingly, there is no assurance that Lexington's expectations will be realized.

References to Lexington refer to Lexington Realty Trust and its consolidated subsidiaries. All interests in properties and loans are held, and all property operating activities are conducted, through special purpose entities, which are separate and distinct legal entities that maintain separate books and records, but in some instances are consolidated for financial statement purposes and/or disregarded for income tax purposes. The assets and credit of each special purpose entity with a property subject to a mortgage loan are not available to creditors to satisfy the debt and other obligations of any other person, including any other special purpose entity or affiliate. Consolidated entities that are not property owner subsidiaries do not directly own any of the assets of a property owner subsidiary (or the general partner, member of managing member of such property owner subsidiary), but merely hold partnership, membership or beneficial interests therein which interests are subordinate to the claims of the property owner subsidiary's (or its general partner's, member's or managing member's) creditors.

7

Non-GAAP Financial Measures - Definitions

Lexington has used non-GAAP financial measures as defined by the Securities and Exchange Commission Regulation G in this Quarterly Earnings Release and in other public disclosures.

Lexington believes that the measures defined below are helpful to investors in measuring our performance or that of an individual investment. Since these measures exclude certain items which are included in their respective most comparable measures under generally accepted accounting principles (“GAAP”), reliance on the measures has limitations; management compensates for these limitations by using the measures simply as supplemental measures that are weighed in balance with other GAAP measures. These measures are not necessarily indications of our cash flow available to fund cash needs. Additionally, they should not be used as an alternative to the respective most comparable GAAP measures when evaluating Lexington's financial performance or cash flow from operating, investing or financing activities or liquidity.

Company Funds Available for Distribution (“FAD”): FAD is calculated by making adjustments to Adjusted Company FFO (see below) for (1) straight-line adjustments, (2) lease incentive amortization, (3) amortization of above/below market leases, (4) lease termination payments, net, (5) non-cash interest, net, (6) non-cash charges, net, (7) cash paid for tenant improvements, and (8) cash paid for lease costs. Although FAD may not be comparable to that of other real estate investment trusts (“REITs”), Lexington believes it provides a meaningful indication of its ability to fund cash needs. FAD is a non-GAAP financial measure and should not be viewed as an alternative measurement of operating performance to net income, as an alternative to net cash flows from operating activities or as a measure of liquidity.

Funds from Operations (“FFO”) and Adjusted Company FFO: Lexington believes that Funds from Operations, or FFO, which is a non-GAAP measure, is a widely recognized and appropriate measure of the performance of an equity REIT. Lexington believes FFO is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. As a result, FFO provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities, interest costs and other matters without the inclusion of depreciation and amortization, providing perspective that may not necessarily be apparent from net income.

The National Association of Real Estate Investment Trusts, or NAREIT, defines FFO as “net income (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sales of certain real estate assets, gains and losses from change in control and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in value of depreciable real estate held by the entity. The reconciling items include amounts to adjust earnings from consolidated partially-owned entities and equity in earnings of unconsolidated affiliates to FFO.” FFO does not represent cash generated from operating activities in accordance with GAAP and is not indicative of cash available to fund cash needs.

Lexington presents FFO available to common shareholders and unitholders - basic and also presents FFO available to all equityholders and unitholders - diluted on a company-wide basis as if all securities that are convertible, at the holder's option, into Lexington’s common shares, are converted at the beginning of the period. Lexington also presents Adjusted Company FFO available to all equityholders and unitholders - diluted which adjusts FFO available to all equityholders and unitholders - diluted for certain items which we believe are not indicative of the operating results of Lexington's real estate portfolio. Lexington believes this is an appropriate presentation as it is frequently requested by security analysts, investors and other interested parties. Since others do not calculate these measures in a similar fashion, these measures may not be comparable to similarly titled measures as reported by others. These measures should not be considered as an alternative to net income as an indicator of Lexington’s operating performance or as an alternative to cash flow as a measure of liquidity.

GAAP and Cash Yield or Capitalization Rate: GAAP and cash yields or capitalization rates are measures of operating performance used to evaluate the individual performance of an investment. These measures are estimates and are not presented or intended to be viewed as a liquidity or performance measure that present a numerical measure of Lexington's historical or future financial performance, financial position or cash flows. The yield or capitalization rate is calculated by dividing the annualized NOI (as defined below, except GAAP rent adjustments are added back to rental income to calculate GAAP yield or capitalization rate) the investment is expected to generate (or has generated) divided by the acquisition/completion cost (or sale) price.

Net Operating Income (“NOI”): NOI is a measure of operating performance used to evaluate the individual performance of an investment. This measure is not presented or intended to be viewed as a liquidity or performance measure that presents a numerical measure of Lexington's historical or future financial performance, financial position or cash flows. Lexington defines NOI as operating revenues (rental income (less GAAP rent adjustments and lease termination income), and other property income) less property operating expenses. Other REITs may use different methodologies for calculating NOI, and accordingly, Lexington's NOI may not be comparable to other companies. Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expenses, other nonproperty income and losses, and gains and losses from property dispositions, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate and the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing a perspective on operations not immediately apparent from net income. Lexington believes that net income is the most directly comparable GAAP measure to NOI.

# # #

8

LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited and in thousands, except share and per share data)

	Three months ended June 30,						Six months ended June 30,
	2019			2018			2019			2018
Gross revenues:
Rental revenue	$	78,758		$	105,493		$	158,733		$	208,130
Other revenue		1,377			180			2,650			364
Total gross revenues		80,135			105,673			161,383			208,494
Expense applicable to revenues:
Depreciation and amortization		(36,811	)		(45,440	)		(74,406	)		(91,977	)
Property operating		(9,788	)		(10,906	)		(20,355	)		(22,383	)
General and administrative		(7,334	)		(7,421	)		(15,861	)		(16,417	)
Non-operating income		914			174			1,395			536
Interest and amortization expense		(17,026	)		(21,734	)		(34,234	)		(42,065	)
Debt satisfaction charges, net		—			—			(103	)		—
Impairment charges		(1,094	)		(35,269	)		(1,682	)		(88,318	)
Gains on sales of properties		15,244			14,432			36,201			37,206
Income (loss) before provision for income taxes and equity in earnings (losses) of non-consolidated entities		24,240			(491	)		52,338			(14,924	)
Provision for income taxes		(430	)		(379	)		(867	)		(882	)
Equity in earnings (losses) of non-consolidated entities		(41	)		75			578			188
Net income (loss)		23,769			(795	)		52,049			(15,618	)
Less net income attributable to noncontrolling interests		(436	)		(899	)		(689	)		(391	)
Net income (loss) attributable to Lexington Realty Trust shareholders		23,333			(1,694	)		51,360			(16,009	)
Dividends attributable to preferred shares – Series C		(1,573	)		(1,573	)		(3,145	)		(3,145	)
Allocation to participating securities		(39	)		(60	)		(85	)		(130	)
Net income (loss) attributable to common shareholders	$	21,721		$	(3,327	)	$	48,130		$	(19,284	)
Net income (loss) attributable to common shareholders - per common share basic	$	0.09		$	(0.01	)	$	0.21		$	(0.08	)
Weighted-average common shares outstanding – basic		232,635,137			237,312,726			232,587,083			237,690,306
Net income (loss) attributable to common shareholders - per common share diluted	$	0.09		$	(0.01	)	$	0.20		$	(0.08	)
Weighted-average common shares outstanding – diluted		236,299,878			237,312,726			236,221,330			237,690,306

9

LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

	June 30, 2019			December 31, 2018
	(unaudited)
Assets:
Real estate, at cost	$	3,112,620		$	3,090,134
Real estate - intangible assets		405,656			419,612
		3,518,276			3,509,746
Less: accumulated depreciation and amortization		963,432			954,087
Real estate, net		2,554,844			2,555,659
Assets held for sale		181,152			63,868
Operating lease right-of-use assets, net		39,981			—
Cash and cash equivalents		43,789			168,750
Restricted cash		17,167			8,497
Investment in non-consolidated entities		59,866			66,183
Deferred expenses, net		20,859			15,937
Rent receivable – current		2,025			3,475
Rent receivable – deferred		63,439			58,692
Other assets		13,794			12,779
Total assets	$	2,996,916		$	2,953,840
Liabilities and Equity:
Liabilities:
Mortgages and notes payable, net	$	432,354		$	570,420
Revolving credit facility borrowings		55,000			—
Term loan payable, net		298,954			298,733
Senior notes payable, net		496,452			496,034
Trust preferred securities, net		127,346			127,296
Dividends payable		29,069			48,774
Liabilities held for sale		111,755			386
Operating lease liabilities		41,077			—
Accounts payable and other liabilities		23,816			30,790
Accrued interest payable		6,135			4,523
Deferred revenue - including below market leases, net		19,021			20,531
Prepaid rent		11,763			9,675
Total liabilities		1,652,742			1,607,162
Commitments and contingencies
Equity:
Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares:
Series C Cumulative Convertible Preferred, liquidation preference $96,770; 1,935,400 shares issued and outstanding		94,016			94,016
Common shares, par value $0.0001 per share; authorized 400,000,000 shares, 234,870,168 and 235,008,554 shares issued and outstanding in 2019 and 2018, respectively		23			24
Additional paid-in-capital		2,771,213			2,772,855
Accumulated distributions in excess of net income		(1,536,752	)		(1,537,100	)
Accumulated other comprehensive income		—			76
Total shareholders’ equity		1,328,500			1,329,871
Noncontrolling interests		15,674			16,807
Total equity		1,344,174			1,346,678
Total liabilities and equity	$	2,996,916		$	2,953,840

10

LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES

EARNINGS PER SHARE

(Unaudited and in thousands, except share and per share data)

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2019		2018			2019		2018
EARNINGS PER SHARE:
Basic:
Net income (loss) attributable to common shareholders	$	21,721	$	(3,327	)	$	48,130	$	(19,284	)
Weighted-average number of common shares outstanding - basic		232,635,137		237,312,726			232,587,083		237,690,306
Net income (loss) attributable to common shareholders - per common share basic	$	0.09	$	(0.01	)	$	0.21	$	(0.08	)
Diluted:
Net income (loss) attributable to common shareholders - basic	$	21,721	$	(3,327	)	$	48,130	$	(19,284	)
Impact of assumed conversions		165		—			166		—
Net income (loss) attributable to common shareholders	$	21,886	$	(3,327	)	$	48,296	$	(19,284	)
Weighted-average common shares outstanding - basic		232,635,137		237,312,726			232,587,083		237,690,306
Effect of dilutive securities:
Unvested share-based payment awards and options		129,810		—			91,637		—
Operating partnership units		3,534,931		—			3,542,610		—
Weighted-average common shares outstanding - diluted		236,299,878		237,312,726			236,221,330		237,690,306
Net income (loss) attributable to common shareholders - per common share diluted	$	0.09	$	(0.01	)	$	0.20	$	(0.08	)

11

LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES

ADJUSTED COMPANY FUNDS FROM OPERATIONS & COMPANY FUNDS AVAILABLE FOR DISTRIBUTION

(Unaudited and in thousands, except share and per share data)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
FUNDS FROM OPERATIONS:
Basic and Diluted:
Net income (loss) attributable to common shareholders	$	21,721		$	(3,327	)	$	48,130		$	(19,284	)
Adjustments:
Depreciation and amortization		36,065			44,225			72,932			89,379
Impairment charges - real estate		1,094			35,269			1,682			88,318
Noncontrolling interests - OP units		165			649			166			(80	)
Amortization of leasing commissions		746			1,215			1,474			2,598
Joint venture and noncontrolling interest adjustment		2,400			258			4,933			516
Gains on sales of properties, including non-consolidated entities		(15,513	)		(14,432	)		(37,118	)		(37,206	)
FFO available to common shareholders and unitholders - basic		46,678			63,857			92,199			124,241
Preferred dividends		1,573			1,573			3,145			3,145
Amount allocated to participating securities		39			60			85			130
FFO available to all equityholders and unitholders - diluted		48,290			65,490			95,429			127,516
Debt satisfaction charges, net		—			—			103			—
Other(1)		—			(3,120	)		—			(3,120	)
Adjusted Company FFO available to all equityholders and unitholders - diluted		48,290			62,370			95,532			124,396
FUNDS AVAILABLE FOR DISTRIBUTION:
Adjustments:
Straight-line adjustments		(4,355	)		(6,013	)		(6,685	)		(10,879	)
Lease incentives		307			519			580			1,055
Amortization of above/below market leases		(26	)		246			(32	)		224
Lease termination payments, net		(256	)		(309	)		(1,000	)		(617	)
Non-cash interest, net		773			1,299			1,579			2,324
Non-cash charges, net		1,552			1,625			3,279			3,564
Tenant improvements		(2,557	)		(662	)		(3,552	)		(6,594	)
Lease costs		(3,549	)		(1,192	)		(4,673	)		(1,801	)
Joint venture and noncontrolling interest adjustment		(460	)		—			(636	)		—
Company Funds Available for Distribution	$	39,719		$	57,883		$	84,392		$	111,672
Per Common Share and Unit Amounts
Basic:
FFO	$	0.20		$	0.27		$	0.39		$	0.51
Diluted:
FFO	$	0.20		$	0.27		$	0.40		$	0.52
Adjusted Company FFO	$	0.20		$	0.25		$	0.40		$	0.50
Basic:
Weighted-average common shares outstanding - basic EPS		232,635,137			237,312,726			232,587,083			237,690,306
Operating partnership units(2)		3,534,931			3,619,315			3,542,610			3,624,228
Weighted-average common shares outstanding - basic FFO		236,170,068			240,932,041			236,129,693			241,314,534
Diluted:
Weighted-average common shares outstanding - diluted EPS		236,299,878			237,312,726			236,221,330			237,690,306
Operating partnership units(2)		—			3,619,315			—			3,624,228
Unvested share-based payment awards and options		15,927			445,283			16,280			503,461
Preferred shares - Series C		4,710,570			4,710,570			4,710,570			4,710,570
Weighted-average common shares outstanding - diluted FFO		241,026,375			246,087,894			240,948,180			246,528,565

(1) "Other" primarily consisted of the acceleration of below-market lease intangible accretion in 2018.

(2) Includes OP units other than OP units held by Lexington.

12

LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES

RECONCILIATION OF NON-GAAP MEASURES

2019 EARNINGS GUIDANCE

	Twelve Months Ended December 31, 2019
	Range
Estimated:
Net income attributable to common shareholders per diluted common share(1)	$	1.28		$	1.32
Depreciation and amortization		0.65			0.65
Impact of capital transactions		(1.17	)		(1.17	)
Estimated Adjusted Company FFO per diluted common share	$	0.76		$	0.80

(1) Assumes all convertible securities are dilutive.

13

LEXINGTON REALTY TRUST

2019 Second Quarter Investments / Capital Recycling Summary

PROPERTY INVESTMENTS
	Property Type	Market		Square Feet (Approx.)		Initial Basis ($000)		Month Closed	Primary Lease Expiration
1	Industrial	Dallas	TX		510,000	$	28,201	April		08/2023
2	Industrial	Spartanburg	SC		408,000		33,253	April		01/2024
3	Industrial	Memphis	TN		928,000		49,395	May		04/2024
4	Industrial	Memphis	TN		270,000		18,316	May		05/2023
5	Industrial	Atlanta	GA		605,000		45,441	June		05/2020
6	Industrial	Atlanta	GA		370,000		27,353	June		05/2024
6	TOTAL PROPERTY INVESTMENTS				3,091,000	$	201,959

CAPITAL RECYCLING

CONSOLIDATED PROPERTY DISPOSITIONS

	Primary Tenant	Location		Property Type	Gross Disposition Price ($000)		Annualized Net Income ($000) (1)			Annualized NOI ($000)(1)(2)			Month of Disposition	% Leased			Gross Disposition Price PSF
1	Honeywell	Glendale	AZ	Office	$	26,500	$	1,319		$	2,014		April		100	%	$	105.03
2	Huntington Ingalls	Pascagoula	MS	Office		6,000		487			593		April		100	%		63.26
3	Vacant	Memphis	TN	Industrial		75		(100	)		(80	)	April		0	%		0.10
4	Safeway	Lawton	OK	Other		1,515		135			184		May		100	%		49.26
5	Vacant	Plymouth	IN	Industrial		6,938		(1,087	)		(833	)	May		0	%		23.09
5	TOTAL PROPERTY DISPOSITIONS				$	41,028	$	754		$	1,878

NON-CONSOLIDATED PROPERTY DISPOSITION

	Primary Tenant	Location		Property Type	Gross Disposition Price ($000)		Annualized Net Income ($000) (1)		Annualized NOI ($000)(1)(2)		Month of Disposition	% Leased			Gross Disposition Price PSF
1	Arrow Electronics (3)	Centennial	CO	Office	$	40,100	$	1,126	$	2,377	May		100.0	%	$	312.06

Footnotes

(1) Quarterly period prior to sale, annualized.

(2) See definitions of non-GAAP measures and reconciliations to applicable GAAP measures in this document.

(3) Lexington has a 20% interest in the joint venture that disposed of this property.

14

LEXINGTON REALTY TRUST

2019 Second Quarter Financing Summary

DEBT RETIRED

Location	Primary Tenant	Property Type	Face / Satisfaction ($000)		Rate	Maturity Date
Consolidated Mortgage Debt
Kansas City, MO	Burns & McDonnell	Office	$	15,208	5.883%	05/2019
Non-Consolidated Mortgage Debt (1)
Centennial, CO	Arrow Electronics	Office	$	30,000	LIBOR+200 bps	09/2021

CORPORATE LEVEL BORROWING

Type	Amount ($000)		Current Interest Rate	Maturity Date
Revolving Credit Facility	$	55,000	LIBOR plus 90 bps	02/2023

Footnotes

(1) Lexington has a 20% interest in the joint venture that disposed of this property.  Satisfaction reflects release amount of the joint venture's cross-collateralized debt.

15

LEXINGTON REALTY TRUST

2019 Second Quarter Leasing Summary

LEASE EXTENSIONS

	Tenant (1)	Location		Prior Term	Lease Expiration Date	Sq. Ft.		New Base Rent Per Annum ($000)(2)(3)		Prior Base Rent Per Annum ($000)		New Cash Base Rent Per Annum ($000)(2)(3)		Prior Cash Base Rent Per Annum ($000)(3)
	Industrial
1	L'Oreal	Streetsboro	OH	10/2019	10/2026		649,250	$	2,699	$	2,611	$	2,513	$	2,817
2	TI Automotive	Lavonia	GA	05/2020	05/2030		133,221		936		952		854		1,200
2	Total industrial lease extensions						782,471	$	3,635	$	3,563	$	3,367	$	4,017
	Office
1	CAE	Whippany	NJ	11/2021	11/2031		123,734	$	2,041	$	2,327	$	1,795	$	2,028
1	Total office lease extensions						123,734	$	2,041	$	2,327	$	1,795	$	2,028
3	TOTAL EXTENDED LEASES						906,205	$	5,676	$	5,890	$	5,162	$	6,045

NEW LEASES

	Tenant (1)	Location		Lease Expiration Date	Sq. Ft.		New Base Rent Per Annum ($000)(2)(3)		New Cash Base Rent Per Annum ($000)(2)(3)
	Industrial
1	Plastic Omnium	Duncan	SC	08/2022		221,833	$	967	$	1,017
1	Total industrial new leases					221,833	$	967	$	1,017
4	TOTAL NEW AND EXTENDED LEASES					1,128,038	$	6,643	$	6,179

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LEXINGTON REALTY TRUST

2019 Second Quarter Leasing Summary (Continued)

NEW VACANCY ⁽⁴⁾

Former Tenant	Location		Lease Expiration Date	Sq. Ft.		2018 Base Rent ($000)(3)		2018 Cash Base Rent ($000)(3)
Office
DMC Insurance	Indianapolis	IN	5/31/2019		3,764	$	72	$	72

Footnotes                      

(1) Leases greater than 10,000 square feet.

(2) Assumes twelve months rent from the later of 7/1/19 or lease commencement/extension, excluding free rent periods as applicable.

(3) See definitions of non-GAAP measures and reconciliations to applicable GAAP measures in this document.

(4) Excludes multi-tenant properties, disposed properties and non-consolidated investments.

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LEXINGTON REALTY TRUST

Other Revenue Data

6/30/2019

($000)

Other Revenue Data

	Base Rent
Asset Class	Six months ended
	6/30/19 (1)		6/30/19 Percentage			6/30/18 Percentage
Industrial	$	99,348		69.4	%		49.8	%
Office/Other		43,793		30.6	%		50.2	%
	$	143,141		100.0	%		100.0	%

	Base Rent
Credit Ratings  (2)	Six months ended
	6/30/19 (1)		6/30/19 Percentage			6/30/18 Percentage
Investment Grade	$	66,478		46.5	%		42.9	%
Non-Investment Grade		40,267		28.1	%		14.9	%
Unrated		36,396		25.4	%		42.2	%
	$	143,141		100.0	%		100.0	%

Weighted-Average Lease Term - Cash Basis	As of 6/30/19	As of 6/30/18
	8.7 years	8.8 years

Rent Estimates for Current Assets

Year	Base Rent  (3)		Cash Base Rent (3)		Difference
2019 - remaining	$	148,053	$	139,398	$	(8,655	)
2020		280,480		268,934		(11,546	)

Footnotes

(1) Six months ended 6/30/2019 Base Rent, recognized for consolidated properties owned as of 6/30/2019.

(2) Credit ratings are based upon either tenant, guarantor or parent/ultimate parent. Historical comparison was not adjusted for subsequent tenant entity changes and multi-tenant was generally reflected as unrated.

(3) Amounts assume (1) lease terms for non-cancellable periods only, (2) no new or renegotiated leases are entered into after 6/30/2019, and (3) no properties are sold or acquired after 6/30/2019.

18

LEXINGTON REALTY TRUST 

Other Revenue Data (Continued) 

6/30/2019 

($000) 

Same-Store NOI ⁽¹⁾

	Six months ended June 30,
	2019			2018
Total Cash Base Rent	$	125,849		$	127,343
Tenant Reimbursements		11,553			9,013
Property Operating Expenses		(17,452	)		(14,064	)
Same-Store NOI	$	119,950		$	122,292
Change in Same-Store NOI (2)		(1.9	)%

Same-Store Percent Leased (3)	As of 6/30/19			As of 6/30/18
		98.0	%		99.1	%

Lease Escalation Data ⁽⁴⁾

Footnotes

(1) NOI is on a consolidated cash basis excluding properties acquired and sold in 2019 and 2018 and properties subject to mortgage loans in default at June 30, 2019.

See definitions of non-GAAP measures and reconciliations to applicable GAAP measures in this document.  

(2) Change in Same-Store NOI was (0.7 %) excluding single-tenant property vacancies.

(3) Excludes properties acquired or sold in 2019 and 2018 and properties subject to mortgage loans in default at June 30, 2019.

(4) Based on six months consolidated Cash Base Rents for single-tenant leases (properties greater than 50% leased to a single tenant) owned as of June 30, 2019. Excludes parking operations and rents from prior tenants.

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LEXINGTON REALTY TRUST

Portfolio Detail By Asset Class

6/30/2019

($000, except square footage)

Asset Class	YE 2016 (5)			YE 2017 (5)			YE 2018 (5)(6)			Q2 2019
Industrial
% of Cost (1)		42.2	%		49.3	%		71.2	%		73.9	%
% of ABR (2)		40.8	%		44.3	%		65.4	%		69.4	%
Leased		98.2	%		99.9	%		96.3	%		99.4	%
Wtd. Avg. Lease Term (3)		10.3			10.5			9.7			9.1
Mortgage Debt	$	240,790		$	193,529		$	206,006		$	203,118
% Investment Grade (2)		25.4	%		28.4	%		31.6	%		42.4	%
Square Feet		28,908,037			36,071,422			41,447,962			43,187,376
Office/Other
% of Cost (1)		57.8	%		50.7	%		28.8	%		26.1	%
% of ABR (2)(4)		59.2	%		55.7	%		34.6	%		30.6	%
Leased		91.3	%		96.0	%		87.1	%		84.3	%
Wtd. Avg. Lease Term (3)		7.4			7.9			7.2			7.7
Mortgage Debt	$	504,383		$	503,539		$	369,508		$	343,524
% Investment Grade (2)		45.0	%		49.4	%		53.2	%		55.7	%
Square Feet		14,416,260			12,542,640			6,111,588			5,733,060

Footnotes

(1) Based on gross book value of real estate assets; excludes held for sale assets.

(2) Percentage of Base Rent, for consolidated properties owned as of each respective period.

(3) Cash basis.

(4) YE 2018 excludes the acceleration of below-market lease intangible accretion on one Kmart asset.

(5) Office and Other properties combined.

(6) Pataskala, Ohio property reclassed to Industrial from Office/Other.

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LEXINGTON REALTY TRUST

Portfolio Composition

6/30/2019

As a Percent of Gross Book Value ⁽¹⁾

Portfolio Composition ⁽²⁾

 

Footnotes

(1) Based on gross book value of real estate assets as of 6/30/2019; excludes held for sale assets.

(2) Based on gross book value of real estate assets as of 6/30/2019, 12/31/2018, 12/31/2017 and 12/31/2016, as applicable and excludes held for sale assets.

21

LEXINGTON REALTY TRUST

Components of Net Asset Value

6/30/2019

($000)

The purpose of providing the following information is to enable readers to derive their own estimates of net asset value. This information is not intended to be an asset-by-asset or enterprise valuation.

Consolidated properties six month net operating income (NOI) (1)
Industrial	$	85,579
Office/Other		34,763
Total Net Operating Income	$	120,342
Lexington's share of non-consolidated six month NOI (1)
NNN OFFICE JV
Office	$	5,298
OTHER JV
Other	$	739
Other income
Advisory fees	$	1,852
In service assets not fairly valued by capitalized NOI method (1)
Wholly-owned assets acquired in 2019	$	257,676
Wholly-owned assets less than 70% leased	$	47,882
Add other assets:
Assets held for sale - consolidated	$	181,152
Assets held for sale - non-consolidated - Lexington's share		15,556
Construction in progress		4,280
Developable land		6,095
Cash and cash equivalents		43,789
Restricted cash		17,167
Accounts receivable		2,025
Other assets		13,794
Total other assets	$	283,858
Liabilities:
Corporate level debt (face amount)	$	984,120
Mortgages and notes payable (face amount)		436,642
Dividends payable		29,069
Liabilities held for sale - consolidated		111,755
Liabilities held for sale - non-consolidated - Lexington's share		962
Accounts payable, accrued expenses and other liabilities		41,714
Preferred stock, at liquidation value		96,770
Lexington's share of non-consolidated mortgages (face amount)		100,380
Total deductions	$	1,801,412
Common shares & OP units at 6/30/2019		238,403,839

Footnotes

(1) NOI for the existing property portfolio at June 30, 2019, excludes NOI related to assets undervalued by a capitalized NOI method and assets held for sale. Assets undervalued by a capitalized NOI method are identified generally by occupancies under 70% and assets acquired in 2019. For assets in this category an NOI capitalization approach is not appropriate, and accordingly, Lexington's net book value has been used. See definitions of non-GAAP measures and reconciliations to applicable GAAP measures in this document.

22

LEXINGTON REALTY TRUST

Consolidated Portfolio Concentration

6/30/2019

	Markets (1)	Percent of Base Rent as of 6/30/19  (2)
1	Houston, TX		10.6	%
2	Memphis, TN		6.0	%
3	Detroit, MI		4.8	%
4	Kennewick, WA		4.8	%
5	New York, NY		3.9	%
6	Dallas, TX		3.7	%
7	Nashville, TN		3.4	%
8	Kansas City, MO		3.3	%
9	Atlanta, GA		2.9	%
10	Philadelphia, PA		2.7	%
11	San Jose, CA		2.3	%
12	Jackson, MS		2.2	%
13	Indianapolis, IN		2.2	%
14	St. Louis, MO		2.2	%
15	Richmond, VA		2.1	%
16	Columbus, OH		1.7	%
17	Columbus, IN		1.7	%
18	Phoenix, AZ		1.7	%
19	Champaign, IL		1.5	%
20	Charlotte, NC		1.4	%
	Total Consolidated Portfolio Concentration (3)		65.0	%

Footnotes

(1) Markets are based on a Core Based Statistical Area, which is the official term for a functional region based around an urban center of at least 10,000 people, based on standards published by the Office of Management and Budget (OMB) in 2000.  These standards are used to replace the definitions of metropolitan areas that were defined in 1990.

(2) Six months ended 6/30/2019 Base Rent recognized for consolidated properties owned as of 6/30/2019.

(3) Total shown may differ from detailed amounts due to rounding.

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LEXINGTON REALTY TRUST

Portfolio Concentration - Industrial

6/30/2019

	Markets (1)	Percent of Base Rent as of 6/30/19  (2)
1	Memphis, TN		8.7	%
2	Houston, TX		7.3	%
3	Kennewick, WA		6.9	%
4	Detroit, MI		5.2	%
5	Nashville, TN		4.9	%
6	Atlanta, GA		3.8	%
7	Jackson, MS		3.1	%
8	St. Louis, MO		3.1	%
9	New York, NY		2.6	%
10	Columbus, OH		2.5	%
11	Dallas, TX		2.2	%
12	Champaign, IL		2.1	%
13	Jackson, TN		2.0	%
14	Richmond, VA		1.9	%
15	Winchester, VA		1.9	%
16	Chicago, IL		1.8	%
17	Indianapolis, IN		1.8	%
18	Shreveport, LA		1.8	%
19	Greenville, SC		1.7	%
20	Elizabethtown, KY		1.7	%
	Total Industrial Portfolio Concentration (3)		66.9	%

Footnotes

(1) Markets are based on a Core Based Statistical Area, which is the official term for a functional region based around an urban center of at least 10,000 people, based on standards published by the Office of Management and Budget (OMB) in 2000.  These standards are used to replace the definitions of metropolitan areas that were defined in 1990.

(2) Six months ended 6/30/2019 Base Rent recognized for consolidated properties owned as of 6/30/2019.

(3) Total shown may differ from detailed amounts due to rounding.

24

LEXINGTON REALTY TRUST

Portfolio Concentration - Office/Other

6/30/2019

	Markets (1)	Percent of Base Rent as of 6/30/19  (2)
1	Houston, TX		18.1	%
2	Kansas City, MO		9.4	%
3	San Jose, CA		7.6	%
4	Philadelphia, PA		7.5	%
5	Dallas, TX		7.0	%
6	New York, NY		6.9	%
7	Columbus, IN		5.6	%
8	Charlotte, NC		4.7	%
9	Detroit, MI		4.0	%
10	Washington, DC		3.6	%
11	Indianapolis, IN		3.0	%
12	Phoenix, AZ		2.7	%
13	Miami, FL		2.6	%
14	Richmond, VA		2.5	%
15	Sarasota, FL		2.2	%
16	Baton Rouge, LA		1.3	%
17	Boise City, ID		1.3	%
18	Bend, OR		1.2	%
19	Augusta, ME		1.2	%
20	McAllen, TX		1.1	%
	Total Office/Other Portfolio Concentration (3)		93.3	%

Footnotes

(1) Markets are based on a Core Based Statistical Area, which is the official term for a functional region based around an urban center of at least 10,000 people, based on standards published by the Office of Management and Budget (OMB) in 2000.  These standards are used to replace the definitions of metropolitan areas that were defined in 1990.

(2) Six months ended 6/30/2019 Base Rent recognized for consolidated properties owned as of 6/30/2019.

(3) Total shown may differ from detailed amounts due to rounding.

25

LEXINGTON REALTY TRUST

Tenant Industry Diversification - Industrial Assets ⁽¹⁾

6/30/2019

Footnotes

(1) Six months ended 6/30/2019 Base Rent recognized for consolidated properties owned as of 6/30/2019.

26

LEXINGTON REALTY TRUST

Tenant Industry Diversification - Office/Other Assets ⁽¹⁾

6/30/2019

Footnotes

(1) Six months ended 6/30/2019 Base Rent recognized for consolidated properties owned as of 6/30/2019.

27

LEXINGTON REALTY TRUST

Top 15 Tenants

6/30/2019

Top 15 Tenants

Tenants (1)	Property Type	Lease Expirations	Number of Leases	Sq. Ft. Leased		Sq. Ft. Leased as a Percent of Consolidated Portfolio (2)(3)			Base Rent as of 6/30/2019 ($000) (4)		Percent of Base Rent as of 6/30/2019 ($000) (2)(4)
Dow	Office	2036	1		664,100		1.4	%	$	7,425		5.2	%
Preferred Freezer(5)	Industrial	2040	1		456,412		1.0	%		6,863		4.8	%
Nissan	Industrial	2027	2		2,971,000		6.2	%		6,380		4.5	%
Dana	Industrial	2021-2026	7		2,053,359		4.3	%		4,970		3.5	%
United States of America (5)	Office	2022 & 2027	2		329,229		0.7	%		4,027		2.8	%
Undisclosed (6)	Industrial	2031-2035	3		1,090,383		2.3	%		3,570		2.5	%
Watco	Industrial	2038	1		132,449		0.3	%		3,386		2.4	%
Xerox	Office	2023	1		202,000		0.4	%		3,321		2.3	%
Morgan Lewis (7)	Office	2021	1		289,432		0.6	%		2,947		2.1	%
Undisclosed (8)	Industrial	2023-2027	3		2,132,290		4.5	%		2,763		1.9	%
FedEx	Industrial	2023 & 2028	2		292,021		0.6	%		2,620		1.8	%
Hamilton Beach	Industrial	2021 & 2026	2		1,645,436		3.4	%		2,474		1.7	%
Cummins	Office	2024	1		390,100		0.8	%		2,434		1.7	%
Michelin	Industrial	2019 & 2020	2		1,759,346		3.7	%		2,428		1.7	%
General Electric (5)	Industrial / Office	2019 & 2024	2		950,427		2.0	%		2,421		1.7	%
			31		15,357,984		32.1	%	$	58,029		40.9	%

Footnotes

(1) See Annual Report and other applicable disclosures for actual tenant names. Includes tenant, guarantor or parent.

(2) Total shown may differ from detailed amounts due to rounding.

(3) Excludes vacant square feet.

(4) Six months ended 6/30/2019 Base Rent recognized for consolidated properties owned as of 6/30/2019, excluding vacant single-tenant properties.

(5) Held for sale or includes a property held for sale at 6/30/2019.

(6) Tenant is a domestic subsidiary of an international automaker.

(7) Subsequent to 6/30/2019, lease extended to 1/31/2024.

(8) Lease restricts certain disclosures. Guarantor is investment grade.

28

LEXINGTON REALTY TRUST

Lease Rollover Schedule - Consolidated Industrial Properties

6/30/2019

($000)

Year	Number of Leases Expiring		Base Rent as of 6/30/2019		Percent of Base Rent as of 6/30/2019			Percent of Base Rent as of 6/30/2018
2019 - remaining		2	$	812		0.8	%		3.1	%
2020		9		5,337		5.4	%		6.3	%
2021		11		7,085		7.1	%		5.8	%
2022		2		752		0.8	%		0.7	%
2023		6		2,568		2.6	%		0.9	%
2024		14		8,117		8.2	%		6.7	%
2025		10		6,819		6.9	%		6.8	%
2026		10		9,052		9.1	%		7.1	%
2027		8		12,297		12.4	%		13.6	%
2028		4		5,928		6.0	%		6.4	%
Thereafter		26		40,581		40.8	%		40.6	%
Total (1)		102	$	99,348		100.0	%

Footnotes

(1) Total shown may differ from detailed amounts due to rounding.

29

LEXINGTON REALTY TRUST

Lease Rollover Schedule - Consolidated Office/Other Properties

6/30/2019

($000)

Year	Number of Leases Expiring		Base Rent as of 6/30/2019		Percent of Base Rent as of 6/30/2019			Percent of Base Rent as of 6/30/2018
2019 - remaining		29	$	2,971		7.0	%		5.4	%
2020		7		1,634		3.8	%		4.4	%
2021		11		6,150		14.4	%		9.5	%
2022		3		2,415		5.7	%		5.2	%
2023		4		3,679		8.6	%		7.3	%
2024		7		5,034		11.8	%		4.7	%
2025		5		1,570		3.7	%		10.1	%
2026		1		559		1.3	%		1.3	%
2027		5		3,454		8.1	%		7.5	%
2028		2		678		1.6	%		2.7	%
Thereafter		13		14,512		34.0	%		29.8	%
Total (1)		87	$	42,656		100.0	%

Footnotes

(1) Total shown may differ from detailed amounts due to rounding and does not include parking operations.

30

LEXINGTON REALTY TRUST

Property Leases and Vacancies - Consolidated Portfolio - 6/30/2019

Year of Lease Expiration	Date of Lease Expiration	Property Location	City	State	Note	Primary Tenant or Guarantor (19)	Sq. Ft. Leased or Available (1)		Base Rent as of 6/30/2019 ($000) (2)		Cash Base Rent as of 6/30/2019 ($000) (2)		6/30/2019 Debt Balance ($000)		Debt Maturity
INDUSTRIAL PROPERTIES
Single-tenant
2019	12/31/2019	2415 US Hwy. 78 East	Moody	AL	–	Michelin		595,346		704		725		-		-
2020	1/31/2020	101 Michelin Dr.	Laurens	SC	–	Michelin		1,164,000		1,724		1,724		-		-
	5/31/2020	7875 White Road SW	Austell	GA	–	Mars Chocolate		604,852		43		60		-		-
	6/30/2020	1650-1654 Williams Rd.	Columbus	OH	–	ODW Logistics		772,450		673		673		-		-
		3102 Queen Palm Dr.	Tampa	FL	–	Time		229,605		617		682		-		-
	9/30/2020	3350 Miac Cove Rd.	Memphis	TN	–	Mimeo.com		107,400		215		230		-		-
	12/19/2020	1901 Ragu Dr.	Owensboro	KY	6	Unilever		443,380		746		644		-		-
	12/31/2020	2203 Sherrill Dr.	Statesville	NC	–	Geodis America		639,800		1,247		1,269		-		-
2021	3/31/2021	2455 Premier Row	Orlando	FL	–	Walgreen Co.		205,016		393		254		-		-
	5/31/2021	291 Park Center Dr.	Winchester	VA	–	Kraft Heinz		344,700		711		719		-		-
	6/30/2021	11624 S. Distribution Cv.	Olive Branch	MS	–	Hamilton Beach		1,170,218		1,894		1,551		-		-
	9/30/2021	3820 Micro Dr.	Millington	TN	–	Ingram Micro		701,819		906		937		-		-
	10/25/2021	6938 Elm Valley Dr.	Kalamazoo	MI	–	Dana		150,945		873		1,014		-		-
	11/30/2021	2880 Kenny Biggs Rd.	Lumberton	NC	–	Quickie Manufacturing		423,280		678		728		-		-
	12/31/2021	191 Arrowhead Dr.	Hebron	OH	–	Owens Corning		250,410		286		286		-		-
		200 Arrowhead Dr.	Hebron	OH	–	Owens Corning		400,522		458		458		-		-
		3686 South Central Ave.	Rockford	IL	–	Pierce Packaging		93,000		160		160		-		-
2022	3/31/2022	5417 Campus Dr.	Shreveport	LA	–	Tire Rack		257,849		671		702		-		-
	8/31/2022	50 Tyger River Dr.	Duncan	SC	–	Plastic Omnium		221,833		81		-		-		-
2023	2/28/2023	7670 Hacks Cross Rd.	Olive Branch	MS	–	MAHLE Industries		268,104		453		450		-		-
	5/31/2023	6495 Polk Ln.	Olive Branch	MS	22	Undisclosed		151,691		52		50		-		-
	8/31/2023	10535 Red Bluff Rd.	Pasadena	TX	–	Unis		257,835		615		600		-		-
		3737 Duncanville Rd.	Dallas	TX	–	Owens Corning		510,440		319		304		-		-
	10/31/2023	493 Westridge Pkwy.	McDonough	GA	–	Carlstar		676,000		762		722		-		-
	12/31/2023	120 Southeast Pkwy. Dr.	Franklin	TN	–	United Technologies		289,330		367		367		-		-

31

LEXINGTON REALTY TRUST

Property Leases and Vacancies - Consolidated Portfolio - 6/30/2019

Year of Lease Expiration	Date of Lease Expiration	Property Location	City	State	Note	Primary Tenant or Guarantor (19)	Sq. Ft. Leased or Available (1)		Base Rent as of 6/30/2019 ($000) (2)		Cash Base Rent as of 6/30/2019 ($000) (2)		6/30/2019 Debt Balance ($000)		Debt Maturity
INDUSTRIAL PROPERTIES
2024	1/31/2024	1285 W. State Road 32	Lebanon	IN	–	Continental Tire		741,880		1,146		1,192		-		-
		6495 Polk Ln.	Olive Branch	MS	22	Undisclosed		118,211		44		41		-		-
		70 Tyger River Dr.	Duncan	SC	–	BMW		408,000		367		352		-		-
	3/31/2024	1520 Lauderdale Memorial Hwy.	Cleveland	TN	–	General Electric		851,370		1,329		1,320		-		-
	4/30/2024	113 Wells St.	North Berwick	ME	–	United Technologies		993,685		899		925		-		-
		11555 Silo Dr.	Olive Branch	MS	22	Undisclosed		927,742		253		166		-		-
	5/31/2024	901 East Bingen Point Way	Bingen	WA	–	Boeing		124,539		1,318		1,312		-		-
		7225 Goodson Rd.	Union City	GA	–	Interface Americas		370,000		23		23		-		-
	7/31/2024	5795 North Blackstock Road	Spartanburg	SC	–	Wal-Mart		341,660		836		811		-		-
	9/30/2024	1621 Veterans Memorial Pkwy. E	Lafayette	IN	–	Caterpillar		309,400		607		602		-		-
	10/31/2024	43955 Plymouth Oaks Blvd.	Plymouth	MI	–	Tower Automotive		311,612		796		769		-		-
		2115 East Belt Line Rd.	Carrollton	TX	–	L.E. Klein		58,202		115		86		-		-
	12/31/2024	749 Southrock Dr.	Rockford	IL	–	Jacobson Warehouse		150,000		319		300		-		-
2025	6/30/2025	10000 Business Blvd.	Dry Ridge	KY	–	Dana		336,350		673		673		-		-
		4010 Airpark Dr.	Owensboro	KY	–	Metalsa / Dana		211,598		604		604		-		-
		730 North Black Branch Rd.	Elizabethtown	KY	–	Metalsa / Dana		167,770		268		268		-		-
		750 North Black Branch Rd.	Elizabethtown	KY	–	Metalsa / Dana		539,592		1,419		1,419		-		-
		301 Bill Bryan Blvd.	Hopkinsville	KY	–	Metalsa / Dana		424,904		844		844		-		-
	7/14/2025	590 Ecology Ln.	Chester	SC	–	Boral Limited		420,597		889		1,186		6,171		08/2025
	7/31/2025	7005 Cochran Rd.	Glenwillow	OH	–	Royal Appliance		458,000		1,031		1,051		-		-
		5352 Performance Way	Whitestown	IN	–	LaCrosse		380,000		611		576		-		-
	12/31/2025	1700 47th Ave North	Minneapolis	MN	–	Owens Corning		18,620		275		275		-		-
2026	3/30/2026	121 Technology Dr.	Durham	NH	15	Heidelberg		500,500		1,269		2,379		-		-
	3/31/2026	633 Garrett Pkwy.	Lewisburg	TN	–	Calsonic Kansei		310,000		644		627		-		-
	4/30/2026	16811 W. Commerce Dr.	Goodyear	AZ	–	Blue Buffalo		540,349		1,222		278		-		-
	6/30/2026	351 Chamber Dr.	Chillicothe	OH	–	Kitchen Collection		475,218		580		579		-		-

32

LEXINGTON REALTY TRUST

Property Leases and Vacancies - Consolidated Portfolio - 6/30/2019

Year of Lease Expiration	Date of Lease Expiration	Property Location	City	State	Note	Primary Tenant or Guarantor (19)	Sq. Ft. Leased or Available (1)		Base Rent as of 6/30/2019 ($000) (2)		Cash Base Rent as of 6/30/2019 ($000) (2)		6/30/2019 Debt Balance ($000)		Debt Maturity
INDUSTRIAL PROPERTIES
2026	9/30/2026	900 Industrial Blvd.	Crossville	TN	–	Dana		222,200		289		289		-		-
		3931 Lakeview Corporate Dr.	Edwardsville	IL	–	Amazon.com		769,500		1,348		1,288		-		-
	10/31/2026	10345 Philipp Pkwy.	Streetsboro	OH	17	L'Oreal		649,250		1,336		1,409		16,402		09/2019
		5001 Greenwood Rd.	Shreveport	LA	–	Libbey		646,000		1,083		1,108		-		-
	11/30/2026	250 Rittenhouse Cir.	Bristol	PA	–	Estée Lauder		241,977		573		590		-		-
		736 Addison Rd.	Erwin	NY	–	Corning		408,000		708		711		-		-
2027	1/31/2027	27200 West 157th St.	New Century	KS	–	Amazon.com		446,500		620		544		-		-
	2/28/2027	554 Nissan Pkwy.	Canton	MS	–	Nissan		1,466,000		3,100		3,011		-		-
	4/30/2027	16407 Applewhite Rd.	San Antonio	TX	18	Undisclosed / HVAC		849,275		1,497		1,402		-		-
		200 Sam Griffin Rd.	Smyrna	TN	–	Nissan		1,505,000		3,280		3,150		-		-
	6/30/2027	1501 Nolan Ryan Expy.	Arlington	TX	–	Arrow Electronics		74,739		203		200		-		-
	9/30/2027	1550 Hwy 302	Byhalia	MS	–	McCormick		615,600		1,219		1,195		-		-
	10/31/2027	201 James Lawrence Rd.	Jackson	TN	–	Kellogg		1,062,055		1,972		1,872		-		-
	12/31/2027	10590 Hamilton Ave.	Cincinnati	OH	–	Hillman Group		264,598		406		406		-		-
2028	1/31/2028	490 Westridge Pkwy.	McDonough	GA	–	Georgia-Pacific		1,121,120		1,868		1,726		-		-
	3/31/2028	29-01-Borden Ave./29-10 Hunters Point Ave.	Long Island City	NY	–	FedEx		140,330		2,568		2,564		38,237		03/2028
	8/31/2028	1420 Greenwood Rd.	McDonough	GA	–	United States Cold Storage		296,972		1,085		1,075		-		-
	9/30/2028	904 Industrial Rd.	Marshall	MI	–	Tenneco		246,508		407		370		-		-
2029	7/31/2029	8500 Nail Rd.	Olive Branch	MS	–	Sephora		716,080		1,376		1,293		-		-
	11/24/2029	318 Pappy Dunn Blvd.	Anniston	AL	–	IAC Group		276,782		870		834		-		-
2030	3/31/2030	549 Wingo Rd.	Byhalia	MS	–	Asics		855,878		2,194		2,077		-		-
	5/31/2030	359 Gateway Dr.	Lavonia	GA	–	TI Automotive		133,221		454		571		6,458		12/2020
		3301 Stagecoach Rd. NE	Thomson	GA	–	Hollander		208,000		158		438		-		-
		4015 Lakeview Corporate Dr.	Edwardsville	IL	–	Spectrum		1,017,780		1,730		1,355		-		-
	6/30/2030	2601 Bermuda Hundred Rd.	Chester	VA	20	Phillip Morris		1,034,470		1,926		1,889		-		-
2031	10/31/2031	1020 W. Airport Rd.	Romeoville	IL	–	ARYZTA		188,166		1,814		1,724		-		-

33

LEXINGTON REALTY TRUST

Property Leases and Vacancies - Consolidated Portfolio - 6/30/2019

Year of Lease Expiration	Date of Lease Expiration	Property Location	City	State	Note	Primary Tenant or Guarantor (19)	Sq. Ft. Leased or Available (1)		Base Rent as of 6/30/2019 ($000) (2)		Cash Base Rent as of 6/30/2019 ($000) (2)		6/30/2019 Debt Balance ($000)		Debt Maturity
INDUSTRIAL PROPERTIES
2031	12/18/2031	80 Tyson Dr.	Winchester	VA	16	Undisclosed / Automaker		400,400		1,184		1,054		-		-
2032	4/30/2032	13930 Pike Rd.	Missouri City	TX	–	Vulcan		-		1,062		991		-		-
	8/24/2032	16950 Pine Dr.	Romulus	MI	16	Undisclosed / Automaker		500,023		1,284		1,207		-		-
	10/31/2032	27255 SW 95th Ave.	Wilsonville	OR	–	Pacific Natural Foods		508,277		1,560		1,343		-		-
		26700 Bunert Rd.	Warren	MI	–	Lipari		260,243		1,942		1,745		25,850		11/2032
2033	12/31/2033	2115 East Belt Line Rd.	Carrollton	TX	–	Teasdale		298,653		648		506		-		-
2034	9/30/2034	5625 North Sloan Ln.	North Las Vegas	NV	–	Nicholas		180,235		1,278		1,158		-		-
	10/31/2034	1001 Innovation Rd.	Rantoul	IL	–	Vista Outdoor		813,126		2,098		1,881		-		-
2035	3/31/2035	13863 Industrial Rd.	Houston	TX	–	Spitzer		187,800		1,217		1,074		-		-
		7007 F.M. 362 Rd.	Brookshire	TX	–	Spitzer		262,095		955		843		-		-
	6/30/2035	111 West Oakview Pkwy.	Oak Creek	WI	–	Stella & Chewy's		164,007		1,049		947		-		-
	10/22/2035	2860 Clark St.	Detroit	MI	16	Undisclosed / Automaker		189,960		1,102		1,102		-		-
2036	5/31/2036	671 Washburn Switch Rd.	Shelby	NC	–	Clearwater Paper		673,425		1,393		1,233		-		-
2037	3/31/2037	4005 E I-30	Grand Prairie	TX	–	O'Neal  Industries		215,000		936		792		-		-
2038	3/31/2038	13901/14035 Industrial Rd.	Houston	TX	–	Watco		132,449		3,386		2,948		-		-
2040	8/31/2040	2800 Polar Way	Richland	WA	9, 10	Preferred Freezer		456,412		6,863		5,726		110,000		01/2026
2042	5/31/2042	4801 North Park Dr.	Opelika	AL	–	Golden State Enterprises		165,493		1,622		1,286		-		-
2067	12/31/2067	10201 Schuster Way	Pataskala	OH	–	Kohl's		-		480		217		-		-
N/A	Vacancy	3350 Miac Cove Rd.	Memphis	TN	–	(Available for Lease)		32,679		-		-		-		-
SINGLE TENANT INDUSTRIAL TOTAL								42,315,902	$	98,172	$	93,111	$	203,118
Multi-tenant / Vacancy (8)(14)
	Various	6050 Dana Way	Antioch	TN	4 (97%)	Multi-Tenant		674,528		1,176		1,167		-		-
	Vacancy	1133 Poplar Creek Rd.	Henderson	NC	–	(Available for Lease)		196,946		-		-		-		-
MULTI-TENANT/VACANCY INDUSTRIAL TOTAL								871,474	$	1,176	$	1,167	$	-
INDUSTRIAL TOTAL/WEIGHTED AVERAGE						99.4% Leased		43,187,376	$	99,348	$	94,278	$	203,118

34

LEXINGTON REALTY TRUST

Property Leases and Vacancies - Consolidated Portfolio - 6/30/2019

Year of Lease Expiration	Date of Lease Expiration	Property Location	City	State	Note	Primary Tenant or Guarantor (19)	Sq.Ft. Leased or Available (1)		Base Rent as of 6/30/2019 ($000) (2)		Cash Base Rent as of 6/30/2019 ($000) (2)		6/30/2019 Debt Balance ($000)		Debt Maturity
OFFICE PROPERTIES
Single-tenant
2019	10/31/2019	10475 Crosspoint Blvd.	Indianapolis	IN	–	John Wiley		123,047		1,134		1,188		-		-
		9601 Renner Blvd.	Lenexa	KS	–	T-Mobile USA		77,484		571		773		7,924		12/2019
	12/31/2019	2800 Waterford Lake Dr.	Midlothian	VA	10	Alstom Power		99,057		1,092		1,206		-		-
2020	2/14/2020	5600 Broken Sound Blvd.	Boca Raton	FL	–	Oce - USA Holding		143,290		1,122		1,250		18,626		02/2020
	6/30/2020	3711 San Gabriel	Mission	TX	–	T-Mobile West		75,016		494		505		-		-
2021	1/31/2021	1701 Market St.	Philadelphia	PA	3	Morgan Lewis		289,432		2,149		2,285		-		-
	3/31/2021	1701 Market St.	Philadelphia	PA	–	Prime Communications		1,220		31		31		-		-
	6/30/2021	1415 Wyckoff Rd.	Wall	NJ	–	NJ Natural Gas		157,511		1,887		1,887		7,237		01/2021
		2050 Roanoke Rd.	Westlake	TX	–	Charles Schwab		130,199		1,034		1,083		-		-
	8/31/2021	3500 North Loop Rd.	McDonough	GA	–	TSYS		62,218		420		420		-		-
	10/31/2021	1401 Nolan Ryan Expy.	Arlington	TX	–	Butler America Aerospace		4,979		42		42		-		-
2022	5/30/2022	13651 McLearen Rd.	Herndon	VA	–	United States of America		159,644		1,564		1,610		-		-
	7/31/2022	1440 E 15th St.	Tucson	AZ	–	CoxCom		28,591		268		268		-		-
	10/31/2022	4455 American Way	Baton Rouge	LA	–	New Cingular Wireless		70,100		583		572		-		-
2023	9/30/2023	1701 Market St.	Philadelphia	PA	–	CBC Restaurant		8,070		121		121		-		-
	12/14/2023	3333 Coyote Hill Rd.	Palo Alto	CA	–	Xerox		202,000		3,321		3,535		29,274		12/2023
2024	2/14/2024	1362 Celebration Blvd.	Florence	SC	–	MED3000		32,000		287		293		-		-
	5/31/2024	3476 Stateview Blvd.	Fort Mill	SC	–	Wells Fargo		169,083		1,007		976		-		-
		3480 Stateview Blvd.	Fort Mill	SC	–	Wells Fargo		169,218		1,043		977		-		-
	7/31/2024	500 Jackson St.	Columbus	IN	17	Cummins		390,100		2,434		2,381		5,379		07/2019
	8/31/2024	10475 Crosspoint Blvd.	Indianapolis	IN	–	HQ Global Workplaces		14,236		157		157		-		-
2025	1/31/2025	1401 Nolan Ryan Expy.	Arlington	TX	–	Triumph Group		111,409		809		887		-		-
	2/28/2025	1401 Nolan Ryan Expy.	Arlington	TX	–	Infotech Enterprise		13,590		104		107		-		-
	5/31/2025	1701 Market St.	Philadelphia	PA	–	TruMark Financial		2,641		129		129		-		-
2026	6/30/2026	3265 East Goldstone Dr.	Meridian	ID	10	T-Mobile USA		77,484		559		755		-		-

35

LEXINGTON REALTY TRUST

Property Leases and Vacancies - Consolidated Portfolio - 6/30/2019

Year of Lease Expiration	Date of Lease Expiration	Property Location	City	State	Note	Primary Tenant or Guarantor (19)	Sq.Ft. Leased or Available (1)		Base Rent as of 6/30/2019 ($000) (2)		Cash Base Rent as of 6/30/2019 ($000) (2)		6/30/2019 Debt Balance ($000)		Debt Maturity
OFFICE PROPERTIES
2027	1/31/2027	1701 Market St.	Philadelphia	PA	–	Drybar		1,975		72		55		-		-
	5/31/2027	2401 Cherahala Blvd.	Knoxville	TN	–	CaremarkPCS		59,748		423		397		-		-
	8/31/2027	133 First Park Dr.	Oakland	ME	–	T-Mobile USA		78,610		504		766		8,005		10/2020
	10/31/2027	11201 Renner Blvd.	Lenexa	KS	10	United States of America		169,585		2,463		2,636		30,696		11/2027
2029	3/31/2029	2800 High Meadow Cir.	Auburn Hills	MI	–	Faurecia		278,000		1,773		1,670		-		-
	7/31/2029	2999 Southwest 6th St.	Redmond	OR	11	Consumer Cellular		77,260		506		149		-		-
	9/30/2029	9200 South Park Center Loop	Orlando	FL	–	CardWorks		59,927		440		-		-		-
2031	4/30/2031	9201 Stateline Rd.	Kansas City	MO	11	Burns & McDonnell Engineering		155,925		1,083		1,045		-		-
	11/30/2031	4 Apollo Drive	Whippany	NJ	–	CAE		123,734		1,120		975		11,867		11/2021
2033	12/31/2033	8555 South River Pkwy.	Tempe	AZ	–	Versum		95,133		740		642		-		-
2036	10/31/2036	270 Abner Jackson Pkwy.	Lake Jackson	TX	–	Dow		664,100		7,425		6,310		185,574		10/2036
N/A	N/A	1701 Market St.	Philadelphia	PA	–	Parking Operations		-		798		798		-		-
	Vacancy	1701 Market St.	Philadelphia	PA	–	(Available for Lease)		699		-		-		-		-
		10475 Crosspoint Blvd.	Indianapolis	IN	11	(Available for Lease)		3,764		31		31		-		-
		1401 Nolan Ryan Expy.	Arlington	TX	–	(Available for Lease)		31,830		-		-		-		-
SINGLE TENANT OFFICE TOTAL								4,411,909	$	39,740	$	38,912	$	304,582
Multi-tenant / Vacancy (8)(14)
	Vacancy	5200 Metcalf Ave.	Overland Park	KS	–	(Available for Lease)		320,198		-		-		32,112		N/A
	Vacancy	820 Gears Rd.	Houston	TX	11	(Available for Lease)		78,895		99		99		-		-
	Various	11511 Luna Rd.	Farmers Branch	TX	4 (88%)	Multi-Tenant		181,072		1,066		1,103		-		-
	Various	1311 Broadfield Blvd.	Houston	TX	4 (66%)	Saipem		155,407		389		374		-		-
	Various	13430 North Black Canyon Fwy.	Phoenix	AZ	4 (65%)	Multi-Tenant		138,940		433		504		-		-
	Various	1460 Tobias Gadson Blvd.	Charleston	SC	4,11 (23%)	Multi-Tenant		50,246		357		353		6,830		02/2021
MULTI-TENANT/VACANCY OFFICE TOTAL								924,758	$	2,344	$	2,433	$	38,942
OFFICE SUBTOTAL/WEIGHTED AVERAGE						88.8% Leased		5,336,667	$	42,084	$	41,345	$	343,524

36

LEXINGTON REALTY TRUST

Property Leases and Vacancies - Consolidated Portfolio - 6/30/2019

Year of Lease Expiration	Date of Lease Expiration	Property Location	City	State	Note	Primary Tenant or Guarantor (19)	Sq.Ft. Leased or Available (1)		Base Rent as of 6/30/2019 ($000) (2)		Cash Base Rent as of 6/30/2019 ($000) (2)		6/30/2019 Debt Balance ($000)		Debt Maturity
OTHER PROPERTIES
Single-tenant
Retail
2023	7/1/2023	1053 Mineral Springs Rd.	Paris	TN	–	Kroger		31,170		80		80		-		-
Specialty
2029	1/31/2029	175 Holt Garrison Pkwy.	Danville	VA	–	Home Depot		-		115		136		-		-
2048	12/31/2048	30 Light St.	Baltimore	MD	–	30 Charm City		-		149		149		-		-
2055	1/31/2055	499 Derbyshire Dr.	Venice	FL	–	Littlestone Brotherhood		31,180		954		682		-		-
2112	8/31/2112	201-215 N. Charles St.	Baltimore	MD	–	201 NC Leasehold		-		155		155		-		-
SINGLE TENANT OTHER TOTAL								62,350	$	1,453	$	1,202	$	-
Multi-tenant / Vacancy (8)(14)
	Vacancy	21082 Pioneer Plaza Dr.	Watertown	NY	10	(Available for Lease)		120,727		-		-		-		-
	Vacancy	97 Seneca Trail	Fairlea	WV	10	(Available for Lease)		90,933		-		-		-		-
	Vacancy	832 N. Westover Blvd .	Albany	GA	10	(Available for Lease)		45,554		-		-		-		-
	Various	King St./1042 Fort St. Mall	Honolulu	HI	4 (44%)	Multi-Tenant		77,459		256		256		-		-
MULTI-TENANT/VACANCY OTHER TOTAL								334,673	$	256	$	256	$	-
OTHER SUBTOTAL/WEIGHTED AVERAGE						24.2% Leased		397,023	$	1,709	$	1,458	$	-
TOTAL OFFICE & OTHER/WEIGHTED AVERAGE						84.3% Leased		5,733,690	$	43,793	$	42,803	$	343,524
TOTAL CONSOLIDATED PORTFOLIO/WEIGHTED AVERAGE						97.7% Leased		48,921,066	$	143,141	$	137,081	$	546,642

37

LEXINGTON REALTY TRUST

Property Leases and Vacancies - Non-consolidated Portfolio - 6/30/2019

Year of Lease Expiration	Date of Lease Expiration	Property Location	City	State	Note	Primary Tenant or Guarantor (19)	Sq.Ft. Leased or Available (1)		LXP % Ownership			Base Rent as of 6/30/2019 ($000) (2)		Cash Base Rent as of 6/30/2019 ($000) (2)		6/30/2019 Debt Balance ($000)		Debt Maturity (13)
NON-CONSOLIDATED PROPERTIES
NNN OFFICE JV PROPERTIES
2022	12/31/2022	231 N. Martingale Rd.	Schaumburg	IL	7	Career Education Corporation		317,198		20	%		2,299		2,333		332,800		09/2021
2023	2/28/2023	1315 West Century Dr.	Louisville	CO	7	Rogue Wave Software		20,000		20	%		155		155		-		-
	3/31/2023	8900 Freeport Pkwy.	Irving	TX	7	Nissan		268,445		20	%		2,443		2,253		-		-
2025	2/28/2025	6555 Sierra Dr.	Irving	TX	7, 12	TXU		247,254		20	%		1,901		1,595		-		-
	3/14/2025	601 & 701 Experian Pkwy.	Allen	TX	7	Experian Holdings		292,700		20	%		1,620		1,537		-		-
	6/30/2025	2500 Patrick Henry Pkwy.	McDonough	GA	7	Georgia Power		111,911		20	%		814		704		-		-
	9/30/2025	10001 Richmond Ave.	Houston	TX	7	Schlumberger		554,385		20	%		3,146		2,877		-		-
	12/31/2025	4001 International Pkwy.	Carrollton	TX	7	Motel 6		138,443		20	%		1,267		1,164		-		-
2026	3/31/2026	500 Olde Worthington Rd.	Westerville	OH	7	Syneos		97,000		20	%		672		594		-		-
	4/30/2026	800 East Canal St.	Richmond	VA	5	Richmond Belly Ventures		2,568		20	%		40		40		-		-
	11/30/2026	500 Kinetic Dr.	Huntington	WV	7	Amazon.com		68,693		20	%		619		578		-		-
2027	2/28/2027	800 East Canal St.	Richmond	VA	5	Sumitomo		8,503		20	%		101		72		-		-
	4/30/2027	1315 West Century Dr.	Louisville	CO	7	GHX Ultimate Parent		86,877		20	%		745		647		-		-
	6/30/2027	3902 Gene Field Rd.	St. Joseph	MO	7	Boehringer Ingelheim USA		98,849		20	%		1,058		970		-		-
	7/6/2027	2221 Schrock Rd.	Columbus	OH	7	MS Consultants		42,290		20	%		342		316		-		-
	8/7/2027	25 Lakeview Dr.	Jessup	PA	7	TMG Health		150,000		20	%		1,165		1,075		-		-
2028	4/30/2028	9655 Maroon Cir.	Englewood	CO	7, 10, 21	TriZetto		166,912		20	%		2,092		1,900		-		-
2029	1/31/2029	6226 West Sahara Ave.	Las Vegas	NV	7	Nevada Power		282,000		20	%		1,737		1,544		-		-
2030	8/31/2030	800 East Canal St.	Richmond	VA	–	McGuireWoods		224,537		20	%		3,497		3,489		57,500		02/2031
	9/30/2030	800 East Canal St.	Richmond	VA	5	The Riverstone Group		25,707		20	%		385		329		-		-
2031	1/10/2031	810 Gears Rd.	Houston	TX	7	United States of America		68,985		20	%		600		712		-		-
	3/1/2031	800 East Canal St.	Richmond	VA	5	Towne Bank		26,047		20	%		422		354		-		-
	12/31/2031	333 Mt. Hope Ave.	Rockaway	NJ	7, 10	Atlantic Health		92,326		20	%		910		658		-		-
2032	4/30/2032	1210 AvidXchange Ln.	Charlotte	NC	–	AvidXchange		201,450		20	%		3,013		2,650		45,900		12/2022; 01/2033
	10/31/2032	143 Diamond Ave.	Parachute	CO	7	Alenco		49,024		20	%		554		589		-		-
2088	8/8/2088	800 East Canal St.	Richmond	VA	5	The City of Richmond, Virginia		-		20	%		178		210		-		-
N/A	Vacancy	810 Gears Rd.	Houston	TX	7	(Available for Lease)		9,910		20	%		-		-		-		-
		800 East Canal St.	Richmond	VA	5	(Available for Lease)		42,947		20	%		-		-		-		-
NNN OFFICE JV TOTAL/WEIGHTED AVERAGE						98.6% Leased		3,694,961				$	31,775	$	29,345	$	436,200

38

LEXINGTON REALTY TRUST

Property Leases and Vacancies - Non-consolidated Portfolio - 6/30/2019

Year of Lease Expiration	Date of Lease Expiration	Property Location	City	State	Note	Primary Tenant or Guarantor (19)	Sq.Ft. Leased or Available (1)		LXP % Ownership			Base Rent as of 6/30/2019 ($000) (2)		Cash Base Rent as of 6/30/2019 ($000) (2)		6/30/2019 Debt Balance ($000)		Debt Maturity (13)
OTHER NON-CONSOLIDATED PROPERTIES
2036	8/31/2036	2203 North Westgreen Blvd.	Katy	TX	–	British Schools		274,000		25	%		3,285		3,285		52,559		12/2022
OTHER NON-CONSOLIDATED TOTAL/WEIGHTED AVERAGE						100% Leased		274,000				$	3,285	$	3,285	$	52,559
NON-CONSOLIDATED TOTAL/WEIGHTED AVERAGE						98.7% Leased		3,968,961				$	35,060	$	32,630	$	488,759

Footnotes

1 Square footage leased or available.

2 Six months ended 6/30/2019 Base Rent and Cash Base Rent. See definitions of non-GAAP measures and reconciliations to applicable GAAP measures in this document.

3 Subsequent to 6/30/2019, lease extended to 1/31/2024.

4 Percent represents % leased as of 6/30/2019.

5 Part of Richmond, Virginia property, which is primarily leased to McGuireWoods LLP.

6 Lexington has a 71.1% interest in this property.

7 All debt is cross-collateralized and cross-defaulted.

8 Multi-tenant properties are properties less than 50% leased to a single tenant.

9 Lamb Weston Holdings, Inc. provides credit support.

10 Property held for sale at 6/30/2019.

11 Base Rent and Cash Base Rent amounts represent/include prior tenant.

12 Lease extended to 02/2035 upon completion of adjacent parking garage.

13 Interest rates range from 0.25% to 5.3% at 6/30/2019.

14 The multi-tenanted / vacant properties incurred approximately $2.5 million in operating expenses, net for the six months ended 6/30/2019.

15 Heidelberg Americas, Inc. lease expires 3/30/2021; however, new tenant (manroland Goss Web Systems America, LLC) lease expires 3/30/2026.

16 Tenant is a domestic subsidiary of an international automaker.

17 Loan satisfied subsequent to 6/30/2019.

18 Lease restricts certain disclosures. Guarantor is investment grade.

19 See Annual Report and other applicable disclosures for actual tenant names.

20 Property includes four warehouses (252,351 square feet each) and one other property (25,066 square feet).

21 Property disposed of subsequent to 6/30/2019.

22 Undisclosed

39

LEXINGTON REALTY TRUST

Select Credit Metrics Summary ⁽¹⁾

	6/30/2019
Adjusted Company FFO Payout Ratio		51.3	%
Unencumbered Assets		$3.0 billion
Unencumbered NOI		75.5	%
(Debt + Preferred) / Gross Assets		40.0	%
Debt/Gross Assets		37.6	%
Secured Debt / Gross Assets		13.4	%
Net Debt / Adjusted EBITDA		5.7	x
(Net Debt + Preferred) / Adjusted EBITDA		6.0	x
Credit Facilities Availability (2)		$545.0 million
Unsecured Debt / Unencumbered NOI		5.1	x

Footnotes

(1) See reconciliations of non-GAAP measures in this document. Lexington believes these credit metrics provide investors with additional information to evaluate its liquidity and performance.

(2) Subject to covenant compliance.

40

LEXINGTON REALTY TRUST

FINANCIAL COVENANTS ⁽¹⁾

Corporate Level Debt

	Must be:		6/30/2019
Bank Loans:
Maximum Leverage		< 60%		43.2	%
Fixed Charge Coverage		> 1.5x		2.4	x
Recourse Secured Indebtedness Ratio		< 10% cap value		0.0	%
Secured Indebtedness Ratio		< 40%		17.4	%
Unsecured Debt Service Coverage		> 2.0x		5.0	x
Unencumbered Leverage		< 60%		33.2	%
Bonds:
Debt to Total Assets		< 60%		38.4	%
Secured Debt to Total Assets		< 40%		13.7	%
Debt Service Coverage		> 1.5x		3.9	x
Unencumbered Assets to Unsecured Debt		> 150%		319.1	%

Footnotes

(1) The following is a summary of the key financial covenants for Lexington's credit facility and term loan and senior notes, as of June 30, 2019 and as defined and calculated per the terms of the credit facility and term loan and senior notes, as of such date and applicable. These calculations are presented to show Lexington's compliance with such covenants only and are not measures of Lexington's liquidity or performance.

41

LEXINGTON REALTY TRUST

Consolidated Properties: Mortgages and Notes Payable

6/30/2019

Property	Footnotes	Debt Balance ($000)		Interest Rate (%)			Maturity (a)	Current Estimated Annual Debt Service ($000)  (b)		Balloon Payment ($000)
INDUSTRIAL
Streetsboro, OH	(c)	$	16,402		5.749	%	09/2019	$	298	$	16,338
Lavonia, GA			6,458		5.460	%	12/2020		741		5,895
Chester, SC			6,171		5.380	%	08/2025		1,144		362
Richland, WA	(d)		110,000		4.000	%	01/2026		4,400		99,492
Long Island City, NY			38,237		3.500	%	03/2028		4,879		-
Warren, MI			25,850		5.380	%	11/2032		1,391		22,037
Industrial Subtotal/Wtg. Avg./Years Remaining (e)		$	203,118		4.311	%	7.1	$	12,853	$	144,124
OFFICE
Overland Park, KS	(f)	$	32,112		5.891	%	N/A	$	-	$	32,112
Columbus, IN	(c)		5,379		2.210	%	07/2019		404		4,993
Lenexa, KS			7,924		6.270	%	12/2019		236		7,770
Boca Raton, FL			18,626		6.470	%	02/2020		1,065		18,414
Oakland, ME			8,005		5.930	%	10/2020		750		7,660
Wall, NJ			7,237		6.250	%	01/2021		3,774		-
Charleston, SC	(f)		6,830		5.850	%	02/2021		520		6,632
Whippany, NJ			11,867		6.298	%	11/2021		1,344		10,400
Palo Alto, CA			29,274		3.970	%	12/2023		7,059		-
Lenexa, KS			30,696		3.700	%	11/2027		3,187		10,000
Lake Jackson, TX			185,574		4.040	%	10/2036		12,532		11,305
Office Subtotal/Wtg. Avg./Years Remaining (e)		$	343,524		4.536	%	10.7	$	30,871	$	109,286
Subtotal/Wtg. Avg./Years Remaining (e)		$	546,642		4.452	%	9.3	$	43,724	$	253,410
CORPORATE (g)
Revolving Credit Facility	(h)	$	55,000		3.304	%	02/2023	$	1,842	$	55,000
Term Loan	(i)		300,000		3.440	%	01/2021		10,463		300,000
Senior Notes			250,000		4.250	%	06/2023		10,625		250,000
Senior Notes			250,000		4.400	%	06/2024		11,000		250,000
Trust Preferred Notes	(j)		129,120		4.283	%	04/2037		5,607		129,120
Subtotal/Wtg. Avg./Years Remaining (e)		$	984,120		3.993	%	5.2	$	39,537	$	984,120
Total/Wtg. Avg./Years Remaining (e)	(k)	$	1,530,762		4.157	%	6.7	$	83,261	$	1,237,530

Footnotes

(a) Subtotal and total based on weighted-average term to maturity shown in years based on debt balance.

(b) Remaining payments for debt with less than 12 months to maturity, all others are debt service for next 12 months.

(c) Loan satisfied subsequent to 6/30/2019.

(d) Loan included in liabilities held for sale at 6/30/2019.

(e) Total shown may differ from detailed amounts due to rounding.

(f) Loan is in default.

(g) Unsecured.

(h) Rate ranges from LIBOR plus 0.775% to 1.45% (Currently 0.90%).

(i) Rate ranges from LIBOR plus 0.85% to 1.65% (Currently 1.00%). Subsequent to 6/30/2019, maturity was extended to 01/2025 and the LIBOR portion of the interest rate was swapped to obtain a current fixed rate of 2.732% per annum.

(j) Rate is three month LIBOR plus 170 bps.

(k) See reconciliations of non-GAAP measures in this document.

42

LEXINGTON REALTY TRUST

Debt Maturity Schedule

6/30/2019

($000)

Consolidated Properties
Year	Mortgage Scheduled  Amortization		Mortgage Balloon Payments		Corporate Debt
2019 - remaining	$	11,802	$	61,213	$	-
2020		23,174		31,969		-
2021		23,433		17,032		300,000	(1)
2022		22,120		-		-
2023		23,998		-		305,000
	$	104,527	$	110,214	$	605,000

Footnotes

(1) Subsequent to 6/30/2019, maturity extended to 01/2025.

(2) Percentage denotes weighted-average interest rate.

43

LEXINGTON REALTY TRUST

Selected Balance Sheet Account Data

6/30/2019

($000)

Balance Sheet

Other assets	$	13,794
The components of other assets are:
Deposits	$	190
Equipment		476
Prepaids		2,828
Other receivables		936
Deferred lease incentives		9,364
Accounts payable and other liabilities
The components of accounts payable and other liabilities are:	$	23,816
Accounts payable and accrued expenses	$	13,368
CIP accruals and other		4,329
Taxes		184
Deferred lease costs		3,382
Deposits		1,650
Escrows		799
Transcation costs		104

44

LEXINGTON REALTY TRUST

NON-GAAP MEASURES

DEFINITIONS

Lexington has used non-GAAP financial measures as defined by the Securities and Exchange Commission Regulation G in the Quarterly Earnings Press Release, in this Quarterly Supplemental Information and in other public disclosures.

Lexington believes that the measures defined below are helpful to investors in measuring our performance or that of an individual investment. Since these measures exclude certain items which are included in their respective most comparable Generally Accepted Accounting Principles (“GAAP”) measures, reliance on the measures has limitations; management compensates for these limitations by using the measures simply as supplemental measures that are weighed in balance with other GAAP measures. These measures are not necessarily indications of our cash flow available to fund cash needs. Additionally, they should not be used as an alternative to the respective most comparable GAAP measures when evaluating Lexington's financial performance or cash flow from operating, investing, or financing activities or liquidity.

Definitions:

Adjusted EBITDA: Adjusted EBITDA represents EBITDA (earnings before interest, taxes, depreciation and amortization) modified to include other adjustments to GAAP net income for gains on sales of properties, impairment charges, debt satisfaction gains (charges), net, non-cash charges, net, straight-line adjustments, non-recurring charges and adjustments for pro-rata share of non-wholly owned entities. Lexington’s calculation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies. Lexington believes that net income is the most directly comparable GAAP measure to Adjusted EBITDA.

Base Rent: Base Rent is calculated by making adjustments to GAAP rental revenue to exclude billed tenant reimbursements, and lease termination income and to include ancillary income. Lexington believes Base Rent provides a meaningful measure due to the net lease structure of leases in the portfolio.

Cash Base Rent: Cash Base Rent is calculated by making adjustments to GAAP rental revenue to remove the impact of GAAP required adjustments to rental income such as adjustments for straight-line rents related to free rent periods and contractual rent increases. Cash Base Rent excludes billed tenant reimbursements and lease termination income and includes ancillary income. Lexington believes Cash Base Rent provides a meaningful indication of an investments ability to fund cash needs.

Funds from Operations (“FFO”) and Adjusted Company FFO: Lexington believes that Funds from Operations, or FFO, which is a non-GAAP measure, is a widely recognized and appropriate measure of the performance of an equity real estate investment trust (“REIT”). Lexington believes FFO is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. As a result, FFO provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities, interest costs and other matters without the inclusion of depreciation and amortization, providing perspective that may not necessarily be apparent from net income.

The National Association of Real Estate Investment Trusts, or NAREIT, defines FFO as “net income (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sales of certain real estate assets, gains and losses from change in control and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in value of depreciable real estate held by the entity. The reconciling items include amounts to adjust earnings from consolidated partially-owned entities and equity in earnings of unconsolidated affiliates to FFO.” FFO does not represent cash generated from operating activities in accordance with GAAP and is not indicative of cash available to fund cash needs.

Lexington presents FFO available to common shareholders and unitholders - basic and also presents FFO available to all equityholders and unitholders - diluted on a company-wide basis as if all securities that are convertible, at the holder's option, into Lexington’s common shares, are converted at the beginning of the period. Lexington also presents Adjusted Company FFO available to all equityholders and unitholders - diluted which adjusts FFO available to all equityholders and unitholders - diluted for certain items which we believe are not indicative of the operating results of Lexington's real estate portfolio. Lexington believes this is an appropriate presentation as it is frequently requested by security analysts, investors and other interested parties. Since others do not calculate these measures in a similar fashion, these measures may not be comparable to similarly titled measures as reported by others. These measures should not be considered as an alternative to net income as an indicator of Lexington’s operating performance or as an alternative to cash flow as a measure of liquidity.

GAAP and Cash Yield or Capitalization Rate: GAAP and cash yields or capitalization rates are measures of operating performance used to evaluate the individual performance of an investment. These measures are estimates and are not presented or intended to be viewed as a liquidity or performance measure that present a numerical measure of Lexington's historical or future financial performance, financial position or cash flows. The yield or capitalization rate is calculated by dividing the annualized NOI (as defined below, except GAAP rent adjustments are added back to rental income to calculate GAAP yield or capitalization rate) the investment is expected to generate (or has generated) by the acquisition/completion cost (or sale) price.

45

LEXINGTON REALTY TRUST

NON-GAAP MEASURES

DEFINITIONS (CONTINUED)

Net Operating Income (NOI): NOI is a measure of operating performance used to evaluate the individual performance of an investment. This measure is not presented or intended to be viewed as a liquidity or performance measure that presents a numerical measure of Lexington's historical or future financial performance, financial position or cash flows. Lexington defines NOI as operating revenues (rental income (less GAAP rent adjustments and lease termination income) and other property income) less property operating expenses. Other REITs may use different methodologies for calculating NOI, and accordingly, Lexington's NOI may not be comparable to that of other companies. Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expenses, other nonproperty income and losses, and gains and losses from property dispositions, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate and the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing a perspective on operations not immediately apparent from net income. Lexington believes that net income is the most directly comparable GAAP measure to NOI.

Same-Store NOI: Same-Store NOI represents the NOI for consolidated properties that were owned and included in our portfolio for two comparable reporting periods excluding properties encumbered by mortgage loans in default and the revenue associated with the expansion of properties, as applicable. As Same-Store NOI excludes the change in NOI from acquired and disposed of properties, it highlights operating trends such as occupancy levels, rental rates and operating costs on properties. Other REITs may use different methodologies for calculating Same-Store NOI, and accordingly, Lexington's Same-Store NOI may not be comparable to other REITs. Management believes that Same-Store NOI is a useful supplemental measure of Lexington's operating performance. However, Same-Store NOI should not be viewed as an alternative measure of Lexington 's financial performance since it does not reflect the operations of Lexington's entire portfolio, nor does it reflect the impact of general and administrative expenses, acquisition-related expenses, interest expense, depreciation and amortization costs, other nonproperty income and losses, the level of capital expenditures and leasing costs necessary to maintain the operating performance of Lexington's properties, or trends in development and construction activities which are significant economic costs and activities that could materially impact Lexington's results from operations. Lexington believes that net income is the most directly comparable GAAP measure to Same-Store NOI.

46

LEXINGTON REALTY TRUST

RECONCILIATION OF NON-GAAP MEASURES

($000)

	Six months ended      June 30, 2019
Rent Reconciliation:
Rental revenue as reported	$	158,733
Rental revenue from sold properties		(1,199	)
Lease termination income		(1,378	)
Ancillary revenue		798
Reimbursements		(13,813	)
Base Rent per supplement		143,141
Adjustments: (1)
Straight-line adjustments		(6,608	)
Lease incentives		580
Amortization of above/below market leases		(32	)
Cash Base Rent per supplement	$	137,081

Consolidated debt reconciliation June 30, 2019:

	GAAP Balance		Deferred Loan Costs, net		Discounts		Loan Classified as Held for Sale		Gross Balance
Mortgages and notes payable (2)	$	432,354	$	4,288	$	-	$	110,000	$	546,642
Revolving credit facility borrowings (3)		55,000		-		-		-		55,000
Term loans payable (3)		298,954		1,046		-		-		300,000
Senior notes payable(3)		496,452		2,449		1,099		-		500,000
Trust preferred securities (3)		127,346		1,774		-		-		129,120
Consolidated debt	$	1,410,106	$	9,557	$	1,099	$	110,000	$	1,530,762

Footnotes

(1) Individual items are adjusted for sold properties, which were previously reflected in the reconciliation.

(2) Secured.

(3) Unsecured.

47

LEXINGTON REALTY TRUST

RECONCILIATION OF NON-GAAP MEASURES (CONTINUED)

($000)

Same-Store NOI Reconciliation:

	Six months ended June 30,
	2019			2018
Net income (loss)	$	52,049		$	(15,618	)
Interest and amortization expense		34,234			42,065
Provision for income taxes		867			882
Depreciation and amortization		74,406			91,977
General and administrative		15,861			16,417
Pursuit / transaction costs		-			353
Non-operating/advisory income		(3,247	)		(900	)
Gains on sales of properties		(36,201	)		(37,206	)
Impairment charges		1,682			88,318
Debt satisfaction charges, net		103			-
Equity in (earnings) of non-consolidated entities		(578	)		(188	)
Lease termination income		(1,378	)		(617	)
Straight-line adjustments		(6,685	)		(10,879	)
Lease incentives		580			1,055
Amortization of above/below market leases		(32	)		(3,248	)
Net Operating Income - ("NOI")		131,661			172,411
Less NOI:
Acquisitions and dispositions		(12,039	)		(47,229	)
Properties in default		328			(2,890	)
Same-Store NOI	$	119,950		$	122,292

NOI for NAV:

	Six months ended
	June 30, 2019
NOI per above	$	131,661
Less NOI:
Disposed of properties		(1,040	)
Assets held for sale		(8,831	)
Assets acquired in 2019		(2,298	)
Assets less than 70% leased / Other		850
NOI for NAV	$	120,342

48

LEXINGTON REALTY TRUST

RECONCILIATION OF NON-GAAP MEASURES (CONTINUED)

($000)

Reconciliation to Adjusted EBITDA:

	Three months ended
	6/30/2019			3/31/2019			12/31/2018			9/30/2018			Trailing 12 Months
Net income attributable to Lexington Realty Trust shareholders	$	23,333		$	28,027		$	25,408		$	218,016		$	294,784
Interest and amortization expense		17,026			17,208			16,656			21,159			72,049
Provision for income taxes		430			437			402			444			1,713
Depreciation and amortization		36,811			37,595			38,498			37,716			150,620
Straight-line adjustments		(4,355	)		(2,330	)		(4,722	)		(5,367	)		(16,774	)
Lease incentives		307			273			227			404			1,211
Amortization of above/below market leases		(26	)		(6	)		(3,500	)		(3,384	)		(6,916	)
Gains on sales of properties		(15,244	)		(20,957	)		(13,336	)		(202,371	)		(251,908	)
Impairment charges		1,094			588			4,953			2,542			9,177
Debt satisfaction charges, net		-			103			368			2,228			2,699
Non-cash charges, net		1,552			1,727			1,611			1,635			6,525
Pro-rata share adjustments:
Non-consolidated entities adjustment		3,223			2,692			1,877			1,388			9,180
Noncontrolling interests adjustment		160			(5	)		15			2,580			2,750
Adjusted EBITDA	$	64,311		$	65,352		$	68,457		$	76,990		$	275,110

49

LEXINGTON REALTY TRUST

RECONCILIATION OF NON-GAAP MEASURES (CONTINUED)

($000)

Reconciliation of Select Credit Metrics:

Adjusted Company FFO Payout:	Six months ended June 30, 2019			(Debt + Preferred) / Gross Assets:	Six months ended June 30, 2019
Common share dividends per share	$	0.205		Consolidated debt	$	1,410,106
Adjusted Company FFO per diluted share		0.40		Held for sale debt		109,527
Adjusted Company FFO payout ratio		51.3	%	Preferred shares liquidation preference		96,770
				Debt and preferred	$	1,616,403
Unencumbered Assets:
Real estate, at cost	$	3,518,276		Total assets	$	2,996,916
held for sale real estate, at cost		238,834		Plus depreciation and amortization:
less encumbered real estate, at cost		(732,849	)	Real estate		963,432
Unencumbered assets	$	3,024,261		Deferred lease costs		19,884
				Held for sale assets		62,644
Unencumbered NOI:
NOI	$	131,661		Gross assets	$	4,042,876
Disposed of properties NOI		(1,040	)
Adjusted NOI		130,621		(Debt + Preferred) / Gross Assets		40.0	%
less encumbered adjusted NOI		(32,019	)
Unencumbered adjusted NOI (Quarters)	$	98,602		Debt  / Gross Assets:
Unencumbered NOI %		75.5	%	Consolidated debt and held for sale debt	$	1,519,633
Net Debt  / Adjusted EBITDA:				Gross assets	$	4,042,876
Adjusted EBITDA	$	275,110
				Debt / Gross assets		37.6	%
Consolidated debt	$	1,410,106
Held for sale debt		109,527		Secured Debt  / Gross Assets:
less consolidated cash and cash equivalents(1)		(50,360	)	Mortgages and notes payable and held for sale debt	$	541,881
Non-consolidated debt, net		96,949
Net debt	$	1,566,222		Gross assets	$	4,042,876
Net debt / Adjusted EBITDA		5.7	x	Secured Debt / Gross Assets		13.4	%
(Net Debt + Preferred)  / Adjusted EBITDA:				Unsecured Debt / Unencumbered NOI:
Adjusted EBITDA	$	275,110		Consolidated debt	$	1,410,106
				less mortgages and notes payable		(432,354	)
Net debt	$	1,566,222		Unsecured Debt	$	977,752
Preferred shares liquidation preference		96,770
Net debt + preferred	$	1,662,992		Unencumbered adjusted NOI (Annual)	$	191,886
(Net Debt + Preferred) / Adjusted EBITDA		6.0	x	Unsecured Debt / Unencumbered NOI		5.1	x

Footnotes

(1) Includes funds held at 1031 exchange intermediaries.

50

Investor Information

Transfer Agent

Computershare	Overnight Correspondence:
PO Box 505000	462 South 4th Street, Suite 1600
Louisville, KY 40233	Louisville, KY 40202
(800) 850-3948
www-us.computershare.com/investor

Investor Relations

Heather Gentry
Senior Vice President, Investor Relations
Telephone (direct)	(212) 692-7219
Facsimile (main)	(212) 594-6600
E-mail	hgentry@lxp.com

Research Coverage

Bank of America/Merrill Lynch		KeyBanc Capital Markets Inc.
James Feldman	(646) 855-5808	Craig Mailman	(917) 368-2316
Evercore Partners		Ladenburg Thalmann & Co., Inc.
Sheila K. McGrath	(212) 497-0882	John Massocca	(212) 409-2543
J.P. Morgan Chase		Stifel Nicolaus
Anthony Paolone	(212) 622-6682	John W. Guinee	(443) 224-1307
Jeffries & Company, Inc.		Wells Fargo Securities, LLC
Jon Peterson	(212) 284-1705	Todd J. Stender	(562) 637-1371

51

 

EX-99.2

EXHIBIT 99.2

Lexington Realty Trust – UNEDITED TRANSCRIPT

Q2 2019 Earnings Call

Company Participants:

T. Wilson Eglin, Chairman and Chief Executive Officer

Beth Boulerice, Executive Vice President, Chief Financial Officer and Treasurer

Brendan Mullinix, Executive Vice President

Lara Johnson, Executive Vice President

James Dudley, Executive Vice President and Director of Asset Management

Heather Gentry, Senior Vice President of Investor Relations

Operator:

Good day, and welcome to the Lexington Realty Trust Second Quarter 2019 Conference Call and Webcast. (Operator Instructions) Please note, this event is being recorded. I would now like to turn the call over to Heather Gentry of Investor Relations. Please go ahead.

Heather Gentry:

Thank you, operator. Welcome to Lexington Realty Trust’s Second Quarter 2019 conference call and webcast. The earnings release was distributed this morning, and both the release and quarterly supplemental are available on our website at www.lxp.com in the Investors section and will be furnished to the SEC on a Form 8-K.

Certain statements made during this conference call regarding future events and expected results may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Lexington believes that these statements are based on reasonable assumptions; however, certain factors and risks, including those included in today’s earnings press release and those described in reports that Lexington files with the SEC from time to time could cause Lexington’s actual results to differ materially from those expressed or implied by such statements. Except as required by law, Lexington does not undertake a duty to update any forward-looking statements.

In the earnings press release and quarterly supplemental disclosure package, Lexington has reconciled all non-GAAP financial measures to the most directly comparable GAAP measure. Any references in these documents to Adjusted Company FFO refer to Adjusted Company Funds from Operations available to all equityholders and unitholders on a fully diluted basis. Operating performance measures of an individual investment are not intended to be viewed as presenting a numerical measure of Lexington's historical or future financial performance, financial position or cash flows.

On today’s call Will Eglin, Chairman and CEO, Beth Boulerice, CFO, and Executive Vice Presidents Brendan Mullinix, Lara Johnson, and James Dudley will provide commentary focused on second-quarter results. I will now turn the call over to Will.

1

T. Wilson Eglin:

Thanks, Heather. Good morning everyone. Our second-quarter results were excellent with strong acquisition, disposition, and leasing activity. This activity aligned well with our stated business objectives of acquiring high-quality industrial assets, disposing of non-core assets, and proactively managing lease expirations. Through our focused efforts, we continue to make consistent progress towards our goal of becoming an industrial REIT focused on single-tenant, net-leased properties.

At quarter-end, our industrial exposure represented 74% of our consolidated portfolio gross book value. Given positive trends in our acquisition and disposition activity, we expect our industrial exposure to increase more rapidly over the balance of the year than it did in the second quarter.

We also saw a nice improvement in overall occupancy during the quarter to almost 98% leased due to consistent leasing activity, new acquisitions, and vacant asset sales. Our balance sheet remains in great shape with our capital needs being satisfied primarily through dispositions.

On the acquisition front, robust activity during the quarter brought year-to-date acquisition volume to $260 million dollars, both at average GAAP and cash cap rates of 5.8%. We are excited by both the quantity and quality of prospects in our pipeline, although the market remains competitive. We currently have accepted offers of north of $300 million dollars of new industrial investments. Our primary focus remains on acquiring high-quality, single-tenant warehouse/distribution assets, and we may work directly with developers on new industrial construction projects from time to time.

Moving on to dispositions, we are increasing the top-end of our 2019 disposition plan guidance range to $750 million dollars from our previously stated $500 million dollars. This increase is driven primarily by the potential sale of our Preferred Freezer facility, which is currently under contract for $244 million dollars. This sale price is extremely favorable compared to our cost of $152 million dollars when we acquired the property in 2015.

Last quarter we discussed the significant cap rate compression in the cold storage sector. The pending Preferred Freezer transaction is a good example of capitalizing on favorable sale opportunities that arise outside of our stated business plan objectives. If executed, this sale will provide us with substantial, well-priced capital to further diversify our industrial portfolio and reinvest into additional warehouse and distribution facilities at modestly higher cap rates. We expect this transaction to close late in the third quarter or early in the fourth quarter of this year.

As a result of this potential sale, together with our other dispositions, we expect overall pricing on 2019 dispositions to come in much better than expected and very favorable when compared to the 8.4% average cash cap rate for 2018. Overall pricing though is greatly dependent upon the timing of other sales, particularly the potential sale of our Dow Chemical complex. We are also mindful of our considerable 1031 exchange needs, which may cause us to push certain 2019 dispositions into early 2020 depending on acquisition volume through the end of the year.

Turning to earnings guidance, we announced this morning revised 2019 Adjusted Company FFO guidance. We increased both the low- and high-end by one penny to a revised range of $0.76 to $0.80 per diluted common share. The factors supporting this increase include better than anticipated acquisition volume and refinancing savings from our recent term loan extension.

2

As we have discussed on previous calls, our disposition strategy is creating short-term FFO dilution, and we expect FFO growth to stay muted as we continue reducing our office exposure. However, we anticipate that AFFO will begin to trend upwards in 2020 as the high capital expenditures associated with our office portfolio decline with non-core asset sales.

We have made tremendous progress in executing on our portfolio strategy over the last few years and looking ahead, we are excited to continue creating a best-in-class single-tenant, net-leased industrial REIT. With that, I’ll turn the call over to Brendan to discuss investments.

Brendan Mullinix:

Thanks, Will. We had a productive second quarter, in which we acquired six warehouse facilities for $202 million dollars at average GAAP and cash cap rates of 5.8% and 5.9%. Purchases included the BMW and Owens Corning industrial facilities we discussed on last quarter’s call.

As a refresher, the BMW facility is a 408,000 square foot Class A distribution center that was completed this past January. The property is located in an established industrial park within a high-demand submarket of Greenville/Spartanburg near the company’s only U.S. based assembly plant. The property is leased for five years, with annual rental increases of 2%.

The 510,000 square foot Owens Corning facility is located in the inner Southwest Dallas submarket near LOOP 12 and Interstate 20, with excellent access to a strong labor force. The four and a half year lease term has 2% annual escalations.

In addition to these properties, we purchased two, two-property industrial portfolios in well-located submarkets within Memphis and Atlanta. The two properties in the Memphis portfolio includes a 928,000 square foot warehouse facility leased to a global food and agriculture company for five years, as well as a 270,000 square foot facility that is leased to a global express delivery company for four years and a logistics company for approximately five years.

The newly-constructed properties are located in the same industrial park within a top Memphis submarket and are within close proximity to major highways and two intermodal facilities. We liked that the properties were recently built with modern Class A bulk specs and are being fully utilized by their respective tenants. Additionally, we believe there is a strong probability of renewal in the future for both properties.

The second portfolio transaction is comprised of two state-of-the-art distribution facilities located approximately 20 miles from one another in high-demand bulk distribution submarkets of Atlanta. The first property, leased for five years to the flooring company, Interface Americas, comprises 370,000 square foot and was built to modern warehouse specifications. The second property totals 605,000 square feet and was leased to Mars Chocolate for about a year of remaining term. Lease negotiations have begun with Mars for continued occupancy beyond their current lease term. We have grown comfortable recently with shorter lease term for the specific deals we have acquired in view of the quality of the real estate, location, and future leasing outcomes that we have forecasted.

3

We have accepted offers on approximately $318 million dollars of industrial properties, and we anticipate the majority of these properties will close in the late third or fourth quarter of 2019. The weighted-average lease term of approximately 10 years for these properties is considerably longer than the four years of weighted-average lease term for our purchases year to date, so these will blend nicely in our portfolio. In addition to these properties, we are currently reviewing other investments in the marketplace, which includes the exploration of a limited number of speculative development opportunities. As we have discussed on previous calls, pricing remains competitive, and I would expect average cap rates for 2019 investment activity to come in somewhere between five and a quarter and five and a half percent for warehouse/distribution product.

I’ll now turn the call over to Lara to discuss dispositions.

Lara Johnson:

Thanks, Brendan. We continue to make good progress on non-core asset sales, and still expect the majority of this activity to close late in the third quarter or in the fourth quarter of this year. This timing extends to the new assets included in the revised 2019 disposition plan that Will discussed earlier. Five non-core consolidated assets, which included a mix of office, retail, and vacant industrial buildings, were sold in the second quarter for $41 million dollars. To date, we’ve disposed of $120 million dollars of consolidated assets at average GAAP and cash cap rates of 5.3% and 4.7%, respectively.

The consolidated assets that have been sold to date produced roughly $5.7 million dollars of annualized NOI. Within our office joint venture, we sold one property during the quarter and one subsequently for combined gross sale proceeds of $101 million dollars, from which we satisfied approximately $73 million of non-recourse debt. Our share of net proceeds totaled $5.4 million dollars from these sales.

We currently have $370 million dollars of sale assets either under contract or with an accepted offer, including the Preferred Freezer transaction. The remaining assets that bring us to the high-end of our 2019 disposition plan guidance range of $750 million dollars are either in the market or being prepared for market. We expect to pursue the sale of our Dow Chemical office complex in Lake Jackson, Texas later this year. This potential sale still represents a meaningful percentage of our 2019 dispositions plan and could close in the fourth quarter provided the sale effort is successful and that we can line up acquisitions to complete 1031 exchanges to defer gains. Given the expected sale of the Preferred Freezer facility, managing our substantial tax gains is critical. As a result, this may push the potential Dow sale beyond year-end.

We remain extremely active on the disposition front. Demand for assets in the marketplace remains strong, and overall pricing has been better than we had anticipated in many cases. At quarter-end, non-core asset exposure represented approximately 26% of our overall gross book value, a sizeable difference compared to 58% at the end of 2016. Post-2019, we will continue disposing of the remaining office portfolio on a one-off basis. That said, as our office exposure becomes less meaningful to the overall portfolio, we would be open to disposing of assets in a more expeditious manner. With that I will turn the call over to James who will provide an update on leasing.

4

James Dudley:

Thanks Lara. We had another active quarter, in which we secured new or extended leases totaling over one million square feet. This activity brings our 2019 leasing volume to almost three million square feet.

Our overall leased portfolio increased to almost 98% at quarter end compared to approximately 95% in the first quarter. This increase was primarily the result of vacant asset sales, specifically the Memphis industrial asset disposed of in the second quarter, as well as new industrial investments coming on line. Additionally, our industrial occupancy increased meaningfully in the second quarter compared to first quarter for the same reason.

Same-store NOI was down around 2%, and when stripping out vacancy, it was down less than 1%. Continued negative same-store NOI is largely a function of marking office rental rates to market following lease extensions. We would expect that as we continue to reduce our office exposure, our same-store NOI growth profile will improve. As of June 30, 2019, 83% of the revenue in our industrial portfolio is generated from leases with rent escalations.

We executed three lease renewals during the quarter approximating 900,000 square feet. On the industrial side, this included a seven-year extension with L’Oréal in our industrial facility in Streetsboro, Ohio, whose lease was set to expire in October. While there was a slight decline in rent, we paid no TI or leasing costs in connection with the extension and annual escalations are 2.5%.

Additionally, we signed a 10-year extension with TI Automotive in Lavonia, Georgia. We agreed to a lower rental rate in exchange for a longer lease term. With a long-term lease, we believe this asset will be more attractive to potential buyers, and it is now a good candidate for a sale given its non-core market location. On the office side, we extended the lease with CAE in Whippany, New Jersey for 10 years, which we believe will help create value upon the sale of the asset.

A unique leasing situation during the quarter resulted in a positive outcome for us. We signed a new lease with Plastic Omnium in our Duncan, South Carolina industrial facility for a three-year term. Plastic Omnium was the prior tenant in the building, but their lease expired in September of last year. They decided that they needed the building again, and are now fully utilizing the 222,000 square foot space at a higher rental rate than they had been paying in the past. We are currently in preliminary discussions with them regarding a longer lease term.

Our remaining 2019 office expirations have been addressed either through sale, future sale, or lease, and we continue to market our one remaining 2019 industrial expiration for lease. We are actively working on lease expirations for 2020 and beyond and have begun discussions or are in negotiations with many of our tenants.

5

Morgan Lewis, who currently occupies the majority of our 305,000 square foot office building in Philadelphia’s central business district, has decided to build a new property. While they will be moving out of our space in the future, they have exercised their three-year renewal option, which will extend their current lease to January 2024. The revised rental rate will be determined through an arbitration process pursuant to the lease if we are unable to negotiate a mutually agreeable rental rate with the tenant. We are reviewing our potential options to maximize the value of the property in the context of our current portfolio strategy.

During the quarter, one of our smaller industrial tenants, Hollander, who currently occupies our 208,000 square foot facility in Thomson, Georgia, filed for Chapter 11. They intend to stay in the building and pay rent through the end of the year. We have begun marketing the property for lease or sale. The overall impact to FFO is deminimus. With that, I will now turn the call over to Beth who will discuss financial results.

Beth Boulerice:

Thanks, James. For the second quarter, net income attributable to common shareholders was $22 million dollars, or $0.09 cents per diluted common share. Adjusted Company FFO was $48 million dollars, or $0.20 cents per diluted common share for the quarter. Our Adjusted Company FFO payout ratio was 51.3% at quarter end, allowing us to retain capital to execute our long-term strategy.

We recorded second-quarter gross revenues of $80 million dollars, compared to gross revenues of $106 million dollars in the second quarter of 2018. This reduction is mostly the result of non-core asset dispositions and lease expirations. Property operating expenses of under $10 million dollars for the quarter declined slightly compared to both the first quarter of 2019 and the second quarter of 2018.

Tenant reimbursements were $6.7 million dollars for the second quarter and represented approximately 68% of our property operating expenses. As a reminder, tenant reimbursements are included within rental revenue on the statement of operations per the new leasing standard. G&A expenses were $7.3 million dollars in the second quarter, a slight decrease compared to the same time period in 2018. Our estimated G&A forecast for the balance of the year is approximately $15 million dollars.

Leasing costs and tenant improvements were approximately $6.1 million dollars in the second quarter, and we expect these costs to range between $10 million and $12 million dollars for the remainder of the year. This is always subject to change due to a variety of factors, including the timing of the completion of the improvements.

6

Moving onto the balance sheet, we continue to have an ample amount of both capacity and flexibility. Cash, including restricted cash, on the balance sheet was approximately $61 million at quarter end. During the quarter and subsequently, we borrowed approximately $75 million dollars under our revolver to primarily fund new acquisitions. Leverage at quarter end was 5.7 times net debt to Adjusted EBITDA, representing an increase when compared to the first quarter. As we have stated in the past, leverage is likely to fluctuate depending on borrowings needed to fund acquisitions given the timing of asset sales. We remain comfortable with leverage within a range of 5 to 6 times net debt to Adjusted EBITDA.

Our consolidated debt outstanding at quarter-end was approximately $1.5 billion with a weighted-average interest rate of approximately 4.2% and a weighted-average term of 6.7 years. Unencumbered NOI represents more than 75% of our overall portfolio.

Subsequent to quarter end, we extended the maturity date on our $300 million dollar term loan to 2025 from 2021. Additionally, we swapped the LIBOR portion of the interest rate to obtain an attractive current fixed rate of 2.73 percent. With that, I’ll turn the call back over to Will.

T. Wilson Eglin:

Thanks Beth. I will now turn the call over to the operator who will conduct Q&A.

Operator:

Thank you. We will now begin the question and answer session. (Operator Instructions) Today’s first question comes from Shelia McGrath of EvercoreISI. Please go ahead.

Shiela McGrath:

Uh, yes, on the Preferred Freezer transaction, I was wondering if you could disclose the cap rate on that; and do you already have acquisitions lined up in a 1031 exchange for that transaction?

T. Wilson Eglin:

Sure, Sheila. The cap rates about four and three quarters on that one and between what we have under contract and letter of intent right now, we have enough acquisitions in the pipeline to complete the 1031 exchange.

Sheila McGrath:

Okay, but you might still have to push that large Texas, the Dow Chemical out further, is that right?

T. Wilson Eglin:

Yes, I mean, that's the question, the Preferred sale, you know, obviously created a need to use a lot of acquisitions in the pipeline for that 1031 exchange. So, the question around Dow is it's just a gating item, we want to make sure we have properties lined up for that exchange before we complete the sale.

Sheila McGrath:

Okay, great. And then on the acquisitions, they all seem to have a shorter term, remaining lease term than typical for Lexington, is that something that we should expect going forward as you continue to increase the industrial exposure?

T. Wilson Eglin:

Not necessarily. If Brendan's comments were oriented towards the pipeline, where we have close to 11 years of weighted average lease term on what's coming. So, we invest in the asset class across all durations, it just happened to be that that during the first six months of the year, there tended to be more opportunity on the shorter end versus the longer, but it's not a specific change in strategy.

Sheila McGrath:

Okay, and one more on CapEx, you mentioned Will in 2020, that you expect that that will decline meaningfully versus 2019. Is there any way you could kind of put that into perspective in numbers, is it cut in half in 2020? Or just some sort of magnitude?

Beth Boulerice:

Hi, Sheila, it's Beth. Yes, we're definitely going to have that come down after this year as we sell off most of our office portfolio which does command high CapEx. So, we're modeling looking somewhere and to about the $10 million to $15 million range for next year for those.

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Sheila McGrath:

Okay, perfect, thank you.

Operator:

And our next question today comes from Craig Mailman of KeyBanc Capital Markets. Please go ahead.

Craig Mailman:

Hey, good morning. Maybe just kind of bigger picture you guys are redeploying more into industrial and it's, you know, not necessarily close to markets the other industrial guys are jumping into. Just curious you know; tenant mix it you guys are really going after in these types of markets.

And also, just curious, you know, retail and department store, I think are about 4% of the portfolio, could you talk a little about the health fair, and also just whether you guys feel like you're at all exposed to any of the agriculture issues going on with the trade war right now, given your mark exposure?

Brendan Mullinix:

Sure, uh this is a Brendan, hi. In terms of our tenant mix, I think if you if you look at our recent transactions, we have a pretty diverse range of tenancy, because we just see the logistics demand drivers going across being very strong across industries. In terms of retail exposure concerns, at the moment, I would say that we don't have any specific concerns from the retail sector.

T. Wilson Eglin:

And in terms of markets, Craig, we invest in both primary and secondary markets generally, where cap rates are 100 to 150 basis points higher than what you might see in the coastal markets. We do have an income-oriented strategy, we're essentially underwriting for more certainty of IRR from the rent streams that we're investing in versus underwriting for, you know, rent growth of more than two or 3%. We think the markets that we invest in, while competitive are a little bit less efficient than then some of the, you know, markets that are desired by other industrial REITs or private investors.

Craig Mailman:

Thanks for that. And then just on the Plastic Omnium, what kind of mark to market do you guys get on that kind of short-term renewal and talk about and maybe you’ll be sensitive because you're going to negotiation, but what kind of a mark to market you think you get on that longer term?

James Dudley:

You know, if there is a slight reduction would be, you know, a very minimal reduction. I think the majority of its going to be making the building into something that's very functional for them. So, it'd be more of a TI related adjustment versus a rental adjustment, excuse me.

Craig Mailman:

And then just on 1701, is it safe to assume that'd be like a zero CapEx, zero free rent renewal? And just you know, as you guys look to minimize your office exposure, obviously, that's a well-located building, but it needs are pretty big refresher or redevelopment there. Um, kind of now that you have the shorter-term option in place, I mean, does it make sense to hold it till the end of that? Or, you know, do you sell the dream now?

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James Dudley:

To answer the first question is, yes, it's non-CapEx renewal. And the second is, we're evaluating our options. I know this was exercised very recently. So, we're looking into all different options for the site and the facility.

Craig Mailman:

And then just last one, you guys continue to sell assets, and there is still slight dilution, as you redeploy. I know, you haven't given 2020 guidance, but you know, if you look at consensus, year to year it looks pretty flattish. I mean, can you comment at all about, you know, trajectory timing, kind of just the math of how dilution should work?

T. Wilson Eglin:

Well, our expectation is that there will be more FFO dilution from the sale process. But we think that the AFFO numbers start to grow next year. So, you know, you're right, we haven't given guidance, but you know, they're there is delusion ahead in FFO, from trading this portfolio.

Craig Mailman:

Great, thank you.

Operator:

And the next today question today comes from John Guinee of Stifel. Please go ahead.

John Guinee:

Great, great, a nice job. In order to get a sense for where you’ll stabilize, should we think of you is running the business at a 6.0 net-debt-to-EBITDA. Is that a good stabilize number to get a sense for how acquisitions and dispositions offset each other?

T. Wilson Eglin:

I think we're very comfortable with leverage at that point in view of the portfolio that we're putting together. You know, doesn't necessarily mean that will run our leverage that that high, but it's certainly very comfortable leverage point for us to be.

John Guinee:

Then you said, I think you said your initial acquisition costs on the freezer deal was $152 million. Don't you have an expansion going on there before you sell it? And how much of the $181 million of assets held for sale is the freezer building?

T. Wilson Eglin:

Um, we have an expansion that that we know essentially, we're not funding it at this point. transactional be closed before the expansion. So, in terms of the held for sale number.

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Beth Boulerice:

It's about 75% of the held for sale number, John.

John Guinee:

What else is in the held for sale number? Just miscellaneous office assets?

Beth Boulerice:

Yeah, we have seven assets and total in the held for sale in it. And if you look at the supplement in the property chart, you'll see which assets they represent.

John Guinee:

Okay, great. And then maybe you talked about this already, but you have an operating lease liability of about $41 million. Does that pertain to ground lease situations on particular assets? And how many assets are affected by your operating lease liability?

Beth Boulerice:

Yeah, that's exactly what it is. It's our ground leases. And we have about eight ground leases that it affects. It also is, we also have our office lease. We have our office lease here in New York and in Dallas, that's also are a part of that as well. But it's mainly ground leases.

John Guinee:

By the way, you're in One Penn, One Penn I think -- building, how is the renovation going.

Beth Boulerice:

Great. So far.

T. Wilson Eglin:

Fantastic.

John Guinee:

They say everybody's going to pay $30 more rent, is Lexington going to pay $30 more rent, Will?

T. Wilson Eglin:

Well, we have a lease that goes through 2025. And then we'll see what our options are.

John Guinee:

Great. Thanks a lot.

T. Wilson Eglin:

Thank you.

Operator:

And our next today comes from Jon Petersen with Jefferies. Please go ahead.

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Jon Petersen:

Great, thanks. Hoping we could get a little more detail on the couple industrial renewals you did this quarter, L’Oréal and TI Automotive, kind of weighted average on a cash basis, those rents rolled down by about 16%. So, I guess what are kind of the unique circumstances that we're seeing rents hold down our industrial properties?

James Dudley:

Yeah, sure, L’Oréal is a large property for the Cleveland market as far as just bulk warehouse, it’s a front loader. We got seven years of term, which was part of it. And there also no capital costs associated with it, no commissions, no TI's. So, the rent is reflected and not paying those costs for the seven-year term. And on TI Auto it’s more of a specialized manufacturing facility where they manufactured gas tanks. In addition to that's a little bit of unique location on the border of South Carolina and Georgia. So, those different factors we thought the term was more important than maintaining the rent and I think as we said in the stated comments, we will look to dispose of that assets now because it doesn't kind of meet the location criteria that we have and being at a regular market.

Jon Petersen:

And then you guys talk about the same store growth and it was like negatives close to 2% and being waived by some office move out. Are you able to breakout year same-store portfolio by office and industrial and give us an idea on how the two different portfolios are growing?

Beth Boulerice:

We currently don’t break out our same store by type currently but as bring on more industrial properties most of them are having escalation in the 2% to 3% range. So, once we get through our office redeployment into industrial, we anticipate that our same store will turn around and grow.

Jon Petersen:

If properties are your held for sale bucket are, they still in the same-store pool.

Beth Boulerice:

Yes.

Jon Petersen:

Okay and then maybe just more high level, just curious a lot of change since the last earnings call in terms of how people are thinking about the economy with trade wars and then also you know what we've seen from the interest rates. So, how is that impacting your ability to sell office properties or appetite out there for the office properties you are trying to sell?

Lara Johnson:

Hi, this is Lara. Um, we really haven't seen a dramatic impact where out with a number of properties that are fully leased with term, we only seen appetite increases for those we are out with some multitenant buildings now in Texas and fortunately we are in growing markets there. In one case in Farmers Branch, Texas and another in the energy quarter in Houston, which is really improving from an occupancy standpoint. So, we haven't seen the effects at this point although we hope to benefit from the reduction in interest rates as we're selling longer-term stuff.

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Jon Petersen:

Thank you.

Operator:

And our next question today comes from John Massocca of Ladenburg Thalmann. Please go ahead.

John Massocca:

Good morning. I’m sorry if I missed this in James' comments, but what progress is being made on lease or sale of the Indianapolis office property and then also maybe the Lenexa property.

Lara Johnson:

Sure. This is Lara. Actually, on the Indianapolis office property where John Wiley is moving out and we do have an offer on that so we're working toward to sale that property simultaneous with lease expiration.

James Dudley:

And on Lenexa we're working on a long-term extension with the subtenant. And that’s in progress we expect to have that executed in early short order.

John Massocca:

And how about the Michelin properties on industrial side?

James Dudley:

We noted previously that they're building and getting close to finalizing there 3.2 million square-foot facility in Greer that they are going to consolidate both of these properties into. There is a decent chance we're going to get a short-term extension from Michelin on both. We have quite a few prospective and one really hot and heavy prospective tenant for the Lawrence facility and then Moody, we have several prospects as well and we're just working through the leasing process there.

John Massocca:

Okay. And then maybe look up maybe longer-term into the 2020 industrial expirations generally speaking, what kind of movement can we expect in cash rent on the potential renewal or releasing, just curious if anything on that list stands out as being how well below or above market?

James Dudley:

Uh, the only that standout in 2020 as being above market is the Tampa asset and that has an office component to it currently which is got the rate at close to $6 and I think that were going to end up somewhere in the $4s on that because it's going to converted to pure industrial. Other than that I don’t really see that should be marked down, everything should be stable or potentially going in the other direction going up.

John Massocca:

Okay. That's it for me. Thank you very much.

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T. Wilson Eglin:

Thank you.

Operator:

And our next question today comes from Nikita Bely of JPMorgan. Please go ahead.

Nikita Bely:

Good morning. Do you still expect to be, I think in the past you said, you want to be at about 90% or above, if I remember correctly of industrial by year-end 2020? Is that still the goal?

T. Wilson Eglin:

Yeah, I think that's a realistic goal. And thinking in the context of surveyed 85% industrial this year. The big question there is will the Dow transaction close this year next because that's a large transaction and its office. But directionally, we're moving toward a 100% industrial construct, as fast as we can go while maximizing value in each case in the office portfolio.

Nikita Bely:

So, as you fully transition now to the industrial portfolio basically within the next 12 to 18 months effectively, where to go off previous question, now just 2020 expiration, tut if you were to look at your entire industrial portfolio, where does that stand in the mark-to-market to the market, basically your entire portfolio?

James Dudley:

I think the entire portfolio, just to kind of throw out an estimate, probably 80% of the portfolio is newer quality, where we're expecting to stabilize rents or have rents grow. And then we still have some of the older industrial properties that have remaining lease term on them that it just is going to kind of depend on how to negotiation goes with the tenants, there's some manufacturing in that number. So that's kind of how I would estimate breaking it down.

Nikita Bely:

And on the topic of acquisitions and dispositions for the remainder of year. So, I just want to give a little bit of specificity of numbers you've mentioned before. You said right now you're under contract for $370 million is that for sale or to buy, is that what you said?

Lara Johnson:

We're under contract or have accepted offers on property sales of about $370 million.

Nikita Bely:

So, between right now and year-end, you might sell $370, so that $370 million includes the Preferred Freezer, right?

Lara Johnson:

It does include the Preferred Freezer and while that's the number under contract or with an accepted offer, e also hope to execute on additional sales of properties that are either in the market now or we plan to take to market in short order.

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Nikita Bely:

And how much is Dow Chemical roughly in rough terms if it were to be executed this year?

T. Wilson Eglin:

Well, we're, we don't really want to prejudice any negotiation we have in the marketing process. We'll update you as that process unfolds.

Nikita Bely:

Got it. And how much do you have in contract to buy right now?

Brendan Mullinix:

We have accepted offer some $318 million.

Nikita Bely:

$318, got it. Okay. That's it. Thank you.

T. Wilson Eglin:

Thank you.

Operator:

And our next question today comes from Sheila McGrath of Evercore ISI. Please go ahead.

Sheila McGrath:

Yes. On the Whippany transaction, I think that was a positive outcome for suburban office in New Jersey. Could you give us a little more detail on, if that was a rent roll down CapEx and what your plan for that asset is? Is it currently being marketed for sale?

James Dudley:

Yes, so the rent went from or is going to go from $26.55 at the end of the current term down to $23.50 triple net, there were $30 in TI that were expended and that is definitely going to be on the list. It's got a, it has a debt balance on it, which has a prepayment penalty. So, we're evaluating whether or not it makes sense to move forward now or wait until the maturity of the debt.

Sheila McGrath:

Okay, great. And then on Arrow Electronics disposition out of your joint venture. Was that a good outcome for the JV on pricing? And should we continue to expect regular sales out of that joint venture?

Lara Johnson:

I think it was a good outcome for the joint venture. It was right in line with where we expected that assets to trade on a one-off basis. And I think we will make select dispositions out of the joint venture as we and our partner together decide opportunities exist. So, in addition to the Arrow sale, we just sold another asset after the end of the quarter. And there are a couple of others, potentially in the pipeline.

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Sheila McGrath:

Okay. Thank you.

Operator:

And our last question is a follow-up from John Guinee of Stifel. Please go ahead.

John Guinee:

Okay, great. The Overland Park Kansas debt and the Charleston debt in default total around $39 million. Is there any asset income associated with either of those assets? And how should we think about the debt on your balance sheet?

Beth Boulerice:

John, the Overland Park asset will probably stay on our balance sheet for the remainder of the year. We are hopeful that the Charleston will maybe by the end of the third quarter be off our balance sheet.

John Guinee:

But are both of those assets vacant and a drag on NOI right now?

Beth Boulerice:

Yes, the Overland Park asset is vacant. The Charleston asset is mostly vacant. So currently the Overland Park asset, we do have some operating expense responsibilities for that asset and the Charleston asset, uh we have a server in place for that asset so that those should be decreasing on the operating expenses.

John Guinee:

Great, thank you.

Operator:

This concludes our question-and-answer session, I'd like to turn the conference back over to the management team for the final remarks.

T. Wilson Eglin:

Thanks to all of you for joining us this morning. Please visit our website or contact Heather Gentry if you would like to receive our quarterly materials. And in addition, as always, you may contact me or the other members of our senior management team with any questions. Thanks again and have a great day.

Operator

Thank you, sir. We thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day.

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