-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WAsUcIRhr92RpTSURwkuG9uM1H+Ecr5yczL+6Vs6PXanAqw1o/WrG4QX0WtoKlYp TP0uedQS2kxaGbmn4oQvoQ== 0000921112-98-000006.txt : 19980305 0000921112-98-000006.hdr.sgml : 19980305 ACCESSION NUMBER: 0000921112-98-000006 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980304 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: LIBERTY PROPERTY TRUST CENTRAL INDEX KEY: 0000921112 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 237768996 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: SEC FILE NUMBER: 001-13130 FILM NUMBER: 98557539 BUSINESS ADDRESS: STREET 1: 65 VALLEY STREAM PKWY STREET 2: STE 100 CITY: MALVERN STATE: PA ZIP: 19355 BUSINESS PHONE: 6106481700 MAIL ADDRESS: STREET 1: 65 VALLEY STREAM PKWY STREET 2: SUITE 100 CITY: MALVERN STATE: PA ZIP: 19355 FORMER COMPANY: FORMER CONFORMED NAME: ROUSE & ASSOCIATES PROPERTY TRUST DATE OF NAME CHANGE: 19940421 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LIBERTY PROPERTY LIMITED PARTNERSHIP CENTRAL INDEX KEY: 0000921113 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 232766549 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: SEC FILE NUMBER: 001-13132 FILM NUMBER: 98557540 BUSINESS ADDRESS: STREET 1: 65 VALLEY STREAM PKWY STREET 2: STE 100 CITY: MALVERN STATE: PA ZIP: 19355 BUSINESS PHONE: 6106481700 MAIL ADDRESS: STREET 1: 65 VALLEY STREAM PKWY STREET 2: SUITE 100 CITY: MALVERN STATE: PA ZIP: 19355 FORMER COMPANY: FORMER CONFORMED NAME: ROUSE & ASSOCIATES LTD PART DATE OF NAME CHANGE: 19940331 10-K 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1997 OR __ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to __________________ Commission file numbers: 1-13130 (Liberty Property Trust) 1-13132 (Liberty Property Limited Partnership) - ------------------------------------------------------------------------ LIBERTY PROPERTY TRUST LIBERTY PROPERTY LIMITED PARTNERSHIP - ------------------------------------------------------------------------ (Exact names of registrants as specified in their governing documents) MARYLAND (Liberty Property Trust) 23-7768996 PENNSYLVANIA (Liberty Property Limited Partnership) 23-2766549 - --------------------------------------------------- ---------- (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification Number) 65 Valley Stream Parkway, Suite 100, Malvern, Pennsylvania 19355 - ------------------------------------ ----- (Address of Principal Executive Offices) (Zip Code) Registrants' Telephone Number, Including Area Code (610) 648-1700 Securities registered pursuant to Section 12(b) of the Act: NAME OF EACH EXCHANGE TITLE OF EACH CLASS ON WHICH REGISTERED - ------------------- ----------------------- Common Shares of Beneficial Interest, New York Stock Exchange $0.001 par value ----------------------- (Liberty Property Trust) - ---------------------------------------------- Exchangeable Subordinated Debentures due 2001 New York Stock Exchange (Liberty Property Limited Partnership) ----------------------- - ---------------------------------------------- 8.80% Series A Cumulative Redeemable Preferred New York Stock Exchange Shares of Beneficial Interest, ----------------------- $0.001 par value (Liberty Property Trust) - ---------------------------------------------- Preferred Share Purchase Rights, New York Stock Exchange $0.0001 par value ----------------------- (Liberty Property Trust) - ---------------------------------------------- Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrants were required to file such reports) and (2) have been subject to such filing requirements for the past ninety (90) days. YES X NO Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K is not contained herein, and will not be contained, to the best of the Registrants' knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. / / As of February 25, 1998, the aggregate market value of the Common Shares of Beneficial Interest, $0.001 par value (the "Common Shares") of Liberty Property Trust held by non-affiliates of Liberty Property Trust was approximately $1.5 billion, based upon the closing price of $26.38 on the New York Stock Exchange composite tape on such date. Non- affiliate ownership is calculated by excluding all Common Shares that may be deemed to be beneficially owned by executive officers and trustees, without conceding that any such persons is an "affiliate" for purposes of the federal securities laws. Number of Common Shares outstanding as of February 25, 1998: 56,799,692 Documents Incorporated by Reference Portions of the proxy statement for the annual meeting of shareholders of Liberty Property Trust to be held in 1998 are incorporated by reference into Part III of this Form 10-K. 2 INDEX PAGE PART I Item 1. Business............................................... 5 Item 2. Properties............................................. 12 Item 3. Legal Proceedings...................................... 20 Item 4. Submission of Matters to a Vote of Security Holders.... 20 PART II Item 5. Market for the Registrants' Common Equity and Related Shareholders' Matters.................................. 21 Item 6. Selected Financial Data................................ 22 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.................... 24 Item 7A. Quantitative and Qualitative Disclosures About Market Risk................................................... 33 Item 8. Financial Statements and Supplementary Data............ 33 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.................... 33 PART III Item 10. Directors and Executive Officers of the Registrants.... 99 Item 11. Executive Compensation................................. 99 Item 12. Security Ownership of Certain Beneficial Owners and Management............................................. 99 Item 13. Certain Relationships and Related Transactions......... 99 PART IV Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K............................................ 99 SIGNATURES...................................................... 105 - --------------------------------- The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. Certain information included in this Annual Report on Form 10-K and other materials filed or to be filed by the Company (as defined below) with the Securities and Exchange Commission (as well as information included in oral statements or other written statements made or to be made by the Company) contains statements that are or will be forward-looking, such as statements relating to acquisitions (including related pro forma financial information) and other business development activities, future capital expenditures, financing sources and availability and the effects of regulation (including environmental regulation) and competition. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by, or on behalf of, the Company. These risks and uncertainties include, but are not limited to, uncertainties affecting real estate businesses generally (such as entry into new leases, renewals of leases and dependence on tenants' business operations), risks relating to acquisition, construction and development activities, possible environmental liabilities, risks relating to leverage and debt service (including availability of financing terms acceptable to the Company and sensitivity of the Company's operations and financing arrangements to fluctuations in interest rates), the potential for the use of borrowings to make distributions necessary to qualify as a REIT (as defined below), dependence on the primary markets in which the Company's properties are located, the existence of complex 3 regulations relating to status as a REIT and the adverse consequences of the failure to qualify as a REIT and the potential adverse impact of market interest rates on the market price for the Company's securities. See "Management's Discussion and Analysis of Financial Condition and Results of Operations - Forward-Looking Statements". 4 PART I ITEM 1. BUSINESS - ---------------- THE COMPANY Liberty Property Trust (the "Trust") is a self-administered and self- managed Maryland real estate investment trust (a "REIT"). Substantially all of the Trust's assets are owned directly or indirectly, and substantially all of the Trust's operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the "Operating Partnership" and, together with the Trust, the "Company"). The Company was formed to continue and expand the commercial real estate business of Rouse & Associates, a Pennsylvania general partnership, and certain affiliated entities (collectively, the "Predecessor"). Founded in 1972, the Predecessor developed and managed commercial real estate in the Southeastern, Mid-Atlantic and West Coast markets. The Company provides leasing, property management, acquisition, development, construction management, design management and other related services for a portfolio which, as of December 31, 1997, consisted of 441 industrial and office properties (the "Properties in Operation") totaling approximately 32.5 million leaseable square feet. As of December 31, 1997, the Properties in Operation were approximately 94.6% leased to over 1500 tenants. As of December 31, 1997, the Company also had 43 properties under development (the "Properties Under Development" and, together with the Properties in Operation, the "Properties"). The Properties Under Development are expected to generate approximately 4.1 million leaseable square feet. The Properties are located principally within the Southeastern, Mid-Atlantic and Mid- Western United States. As of December 31, 1997, the Company also owned 957 acres of land, all zoned for commercial use, which the Company anticipates are capable of supporting, as and when developed, approximately nine million leaseable square feet. The Company is obligated to purchase, over a 10-year period ending in 2007, approximately 800 acres of land. During the year ended December 31, 1997, through Total Investments (as defined below) aggregating $871.5 million, the Company increased its total leaseable square footage of industrial and office space approximately 57.4% by acquiring 170 properties totaling approximately 9.5 million leaseable square feet and by developing 20 properties totaling approximately 2.9 million leaseable square feet. The "Total Investment" for a property is defined as the property's purchase price plus closing costs and management's estimate, as determined at the time of acquisition, of the cost of necessary building improvements in the case of acquisitions, or land costs and land and building improvement costs in the case of development projects, and, where appropriate, other development costs and carrying costs required to reach rent commencement. The Properties in Operation, as of December 31, 1997, consisted of 297 industrial and 144 office properties. Single tenants occupied 154 of the Properties in Operation. The Company provides a reduced level of services in connection with the operation or maintenance of these properties. The remaining 287 of the Properties in Operation were 5 occupied by multiple tenants for which the Company renders a range of building, operating and maintenance services. The Company's industrial properties consist of a variety of warehouse, distribution, service, assembly, light manufacturing and research and development facilities. Substantially all of the Company's industrial properties are located in suburban, mixed-use developments or business parks. They include both single-tenant and multi-tenant facilities, with most designed flexibly to accommodate various types of tenants, space requirements and industrial uses in an effort to increase re-leasing opportunities and control re-leasing costs. The Company's office properties are mid-rise and single-story office buildings, located principally in suburban mixed-use developments or office parks. Substantially all are located in prime business locations within established business communities offering excellent access to interstate highway systems. The Trust is the sole general partner and also a limited partner of the Operating Partnership, with a combined equity interest in the Operating Partnership of 91.86% at December 31, 1997. The units of limited partnership interest (the "Units") in the Operating Partnership are exchangeable on a one-for-one basis (subject to antidilution protections) for the Common Shares of Beneficial Interest $0.001 par value per share (the "Common Shares"), of the Trust typically after the first anniversary of the issuance of any such Units. The only limited partners of the Operating Partnership other than the Trust are persons or entities that contributed assets to the Operating Partnership. The Units held by the limited partners other than the Trust (that is, the minority interest reflected in the Trust's financial statements) were exchangeable for approximately 4.7 million Common Shares on December 31, 1997. Certain holders of Units issued in connection with the contribution of assets to the Operating Partnership have the right to require the Company to register the issuance or resale of the Common Shares underlying their Units upon exchange for the Units, in order to afford such holders liquidity with respect to their investment. The Company's executive offices are located at 65 Valley Stream Parkway, Malvern, Pennsylvania 19355. The telephone number is (610) 648-1700. The Company maintains offices in each of its principal markets. As of December 31, 1997 the Company's principal markets were as follows: Southeastern Pennsylvania; New Jersey/Delaware; Lehigh Valley, Pennsylvania; Richmond, Virginia; the Baltimore/Washington Corridor; the Carolinas; Jacksonville, Florida; Tampa, Florida; South Florida; the Minneapolis metropolitan area; and the Detroit metropolitan area. MANAGEMENT AND EMPLOYEES The Company's 278 employees (as of February 25, 1998) are under the direction of 19 senior executives, who have developed and managed over 35 million square feet of commercial real estate during the past 25 years and who, on average, have been affiliated with the Company and/or the Predecessor for 13 years. The Company's in-house leasing, marketing and property management staff operates in 12 full-service local offices in the United States. This structure enables the Company to better understand the particular characteristics of the local markets in which it operates, to respond quickly and directly to tenant needs and to better identify local acquisition and development opportunities. The Company considers its relations with its employees to be good. BUSINESS OBJECTIVES AND STRATEGIES FOR GROWTH The Company's business objective is to maximize long-term profitability for its shareholders by (i) maintaining and increasing property occupancy and rental rates through the effective management of the 6 Properties and (ii) developing and acquiring high quality properties in existing and select new markets. In accomplishing these objectives the Company also intends to maintain a conservative and flexible capital structure. INTERNAL GROWTH STRATEGIES Management believes that the Properties offer significant opportunities for the Company to increase its rental revenues and cash flow over the long term. The Company seeks to increase cash flow by continuing its practice of negotiating for contractual rental increases that take effect during the terms of its leases. In addition, the Company seeks to increase rental revenues through the renewal or replacement of expiring leases at higher rental rates and by improving the occupancy rates of its portfolio. NEW LEASES AND LEASE RENEWALS. In the early 1990's, rental rates in the markets in which the Properties are located were flat or decreased as a result of recessionary market conditions and an oversupply of commercial real estate in such markets. Since that time, rental rates in these markets have improved, and as the leases entered into in the early 1990s and subsequent years have expired, the Company generally has been experiencing increases in rental rates in replacement and renewal leases. Although no assurance can be given, the Company expects that in the near term, replacement and renewal leases will continue to reflect higher rental rates. CONTRACTUAL INCREASES. The Company seeks to generate increased cash flow from the Properties in Operation through contractual increases in rental rates under its leases. The leases in effect with respect to the Properties in Operation as of December 31, 1997 provide for contractual rental increases that are expected to contribute an additional $1.9 million to the Company's cash flow for the year ending December 31, 1998. The Company intends to continue seeking to negotiate contractual rent increases that take effect during the terms of its leases. IMPROVING OCCUPANCIES. The Company believes that the quality and diversity of its tenant base has contributed, and will continue to contribute, to the success of its strategy for increasing rental and occupancy rates. The Company targets financially stable tenants in an effort to minimize uncertainty relating to the ability of its tenants to meet their lease obligations. The Company's success in maintaining its occupancy rates and attracting and retaining tenants is demonstrated in part by its renewal rate which was approximately 72.2% for the year ended December 31, 1997. COST CONTROLS. The Company seeks to monitor and control its operating and administrative costs by performing many functions in-house rather than by engaging outside third parties. For example, although construction and design services typically are provided by third parties (including, in certain instances, an entity affiliated with one or more of the Company's senior executives), the Company's in-house construction and design management staff closely supervises construction and design activities in an effort to control costs, minimize cost overruns, ensure timely delivery of tenant space and maximize productivity and efficiencies. The Company also employs an annual capital improvement and preventive maintenance program designed to reduce the operating costs of the Properties and maintain their long-term values. 7 ACQUISITIONS STRATEGY The Company seeks to acquire properties consistent with its business objectives and strategies. The Company executes its acquisition strategy by purchasing portfolios of properties and individual properties as single asset acquisitions. Portfolios are considered to be groups of properties or existing real estate companies within existing markets or select new markets. At times, the Company may acquire multiple properties which because of their aggregate size or other factors are not considered portfolio acquisitions. The Company has identified the following general categories of properties for acquisition: Stabilized Acquisitions which consist of individual properties which are typically at high occupancy levels upon acquisition. Entrepreneurial Acquisitions which consist of properties which are typically either vacant or at low occupancy levels and can be purchased substantially below replacement cost, thereby offering the opportunity for above-average returns when fully renovated and leased. SINGLE-ASSET ACQUISITIONS ------------------------- During the year ended December 31, 1997, the Company completed 78 acquisitions of this type, aggregating approximately 4.5 million leaseable square feet for a Total Investment of $346.7 million. The following sets forth certain information with respect to such acquisitions: Stabilized Acquisitions. During the year ended December 31, 1997 the Company completed acquisitions of 64 stabilized properties aggregating approximately 3.5 million leaseable square feet of industrial and office space for a Total Investment of $280.5 million. Entrepreneurial Acquisitions. During the year ended December 31, 1997, the Company completed entrepreneurial acquisitions of 14 entrepreneurial properties aggregating approximately one million leaseable square feet of industrial and office space for a Total Investment of $66.2 million. PORTFOLIO ACQUISITIONS ---------------------- Portfolio acquisitions may include stabilized, entrepreneurial and development properties and are considered to offer opportunities for enhanced operating performance as a result of the Company's management expertise and financial strength and/or the portfolio's fit within the Company's business plan. During the year ended December 31, 1997, the Company completed five portfolio acquisitions, consisting in the aggregate of 88 stabilized properties and four entrepreneurial properties. In connection with these portfolio acquisitions, the Company opened offices to serve its new markets in the Detroit and Minneapolis metropolitan areas and South Carolina. The properties acquired in the portfolio acquisitions comprise, in the aggregate, approximately 5.0 million leaseable square feet for a Total Investment of $381.2 million. The following sets forth certain information with respect to such portfolio acquisitions: 8 Detroit Portfolios. In June 1997, the Company entered the suburban Detroit, Michigan market with the acquisition of a portfolio (the "First Detroit Portfolio"). The First Detroit Portfolio consisted of 13 industrial and office properties totaling approximately 1.1 million leaseable square feet which were purchased for a Total Investment of approximately $131.3 million. All of these properties were considered stabilized acquisitions. In September 1997, the Company increased the number of properties it owned in the suburban Detroit market by acquiring a second portfolio (the "Second Detroit Portfolio"). The Second Detroit Portfolio consisted of 28 industrial properties totalling approximately 841,000 leaseable square feet which were purchased for a Total Investment of approximately $45.0 million. All of these properties were considered stabilized acquisitions. South Carolina Portfolio. In May 1997, the Company acquired a portfolio consisting of properties located mainly in South Carolina (the "South Carolina Portfolio"). The South Carolina Portfolio consisted of 18 properties totalling approximately 1.4 million leaseable square feet, 11 of which were considered stabilized acquisitions, three of which were considered entrepreneurial acquisitions and four of which were considered development properties. The Total Investment for the stabilized and entrepreneurial properties was approximately $57.6 million. The development properties comprised approximately 324,000 of the 1.4 million leaseable square feet and the Total Investment in the development properties was approximately $18.5 million. In connection with the acquisition of the South Carolina Portfolio, the Company is also obligated to purchase, over a 10-year period ending in 2007, approximately 800 acres of land for commercial development. The purchase price of the land is $17.5 million, plus accrued interest at 7.5% per annum, payable over 10 years ending in 2007. Minneapolis Portfolio. In March 1997, the Company acquired a portfolio in Minneapolis, Minnesota (the "Minneapolis Portfolio"). All of the properties in the portfolio were considered stabilized acquisitions and totalled approximately 1.0 million square feet. The Total Investment in the Minneapolis Portfolio was approximately $63.3 million. The Company also acquired 25 acres of land for commercial development, which the Company anticipates to be capable of supporting, as and when developed, approximately 180,000 leaseable square feet of office or industrial space. The purchase price of the land was $2.9 million, in addition to the purchase price of the industrial and office properties in the portfolio. Horsham Portfolio. In November 1997, the Company acquired a portfolio of properties in the Pennsylvania Business Campus in Horsham, Pennsylvania (the "Horsham Portfolio"). The Horsham Portfolio consisted of 21 industrial and office properties, 20 of which were considered stabilized and one of which was considered entrepreneurial. The properties, totaling approximately one million leaseable square feet, were purchased for a Total Investment of $84.0 million. DEVELOPMENT STRATEGY. The Company pursues selective development opportunities focusing primarily on high-quality suburban industrial and office properties within its existing markets. The Company's development activities fall into two categories: build-to-suit projects and projects 9 built for inventory. The Company develops build-to-suit (approximately 70% pre-leased) projects for existing and new tenants. The buildings in these projects are substantially pre-leased to one or more tenants prior to construction. The Company also builds properties for inventory typically in high-occupancy markets in which the Company has identified sufficient demand at market rental rates to justify such construction. COMPLETED PROPERTY DEVELOPMENTS. During the year ended December 31, 1997, the Company completed 11 build-to-suit and nine inventory projects, totalling approximately 2.9 million square feet of leaseable space and representing a Total Investment of approximately $143.5 million. As of December 31, 1997, the completed development properties were 97.6% leased. PROPERTIES UNDER DEVELOPMENT. As of December 31, 1997, the Company was developing 43 properties which, upon completion, are expected to generate approximately 4.1 million leaseable square feet. Approximately 42.5% of such leaseable space was pre-leased as of December 31, 1997. The Properties Under Development as of December 31, 1997 are expected to represent a Total Investment of $304.9 million. Five of these properties are 100% pre-leased under net leases as build-to-suit projects. There can be no assurance that any of the Properties Under Development will be completed, or that the Company's budgets or estimates of construction costs or time periods necessary to complete construction of such Properties, will be realized. The Company is scheduled to complete development of 20 properties (totaling 2.5 million leaseable square feet) in the year ended December 31, 1998 representing a Total Investment of $162.7 million. LAND. As of December 31, 1996, the Company owned 1,012 acres of land for development, all zoned for commercial use. During the year ended December 31, 1997, the Company purchased an additional 280 acres of land for development, utilized 283 acres in development projects and sold 52 acres. Substantially all of the remaining 957 acres owned as of December 31, 1997 is located adjacent to or within existing industrial or business parks with site improvements, such as public sewers, water and utilities, available for service. The Company anticipates that the land would support, as and when developed, approximately nine million leaseable square feet. The Company's Total Investment in land held for development as of December 31, 1997 was $61.9 million. In connection with the acquisition of the South Carolina Portfolio, the Company is obligated to purchase, over a 10-year period ending in 2007, approximately 800 acres of land for commercial development, which the Company believes is capable of supporting, as and when developed, approximately eight million leaseable square feet of industrial or office space. Substantially all of the acreage the Company is obligated to purchase is located in the Charleston, Columbia and Greenville, South Carolina markets. The Company believes that, because it is a fully integrated real estate firm, its base of commercially zoned land in existing industrial and business parks provides a competitive advantage for future development activities. INTERNATIONAL OPERATION. The Company's international operations include four Properties in Operation in the County of Kent, England. In addition, the Company provides management services with respect to a joint venture between Rouse Kent Limited, which is owned by certain senior executives of the Company, and the County of Kent, England to develop a 650-acre, mixed-use park approximately 25 miles southeast of London. The Company has an option to purchase Rouse Kent Limited for nominal consideration. The Company committed to loans in 1996 to two 10 affiliates for development projects. As of December 31, 1997, only one of these loans, with a balance of $5.5 million, remained outstanding. SUBSEQUENT ACTIVITIES Since December 31, 1997, the Company has purchased 23 industrial and office properties containing approximately 1.6 million leaseable square feet for a Total Investment of $131.7 million. In addition, the Company has completed development of four industrial and office properties containing approximately 207,000 leaseable square feet for a Total Investment of $15.2 million. The Company intends to pursue its acquisition and development strategies. The Company is currently in various stages of discussions and negotiations with respect to acquisition and development projects totaling over $400.0 million of Total Investment. The consummation of these or any other future acquisitions or developments, if any, and the pace at which acquisitions may be made and developments completed, cannot be assured. COMPETITION The Company faces competition as a buyer, developer and lessor of properties and will likely face competition as an eventual seller of properties to the extent that properties are sold. The Company may be competing with other owners and developers with greater resources and whose management may have more experience than the Company's officers and trustees. There are numerous other entities, including but not limited to other REITs, that compete with the Company in seeking to acquire the limited number of properties available for sale that meet the Company's acquisition strategy. Like the Company, many of the potentially competing purchasers can use their own securities in making acquisitions. Additionally, the number of competitive properties in any particular market in which the Company's Properties are located could have a material adverse effect on both the Company's ability to lease space at the Properties or any newly acquired or developed property and on the rents charged for the Properties in Operation. However, the Company believes that its capital base, its existing sources of credit and its access, as a publicly owned entity, to the public capital markets to raise funds during periods when conventional sources of financing may be unavailable or relatively more expensive will provide the Company with competitive advantages. Further, the Company believes that its responsiveness to tenant needs will enable it to attract and retain high quality tenants in the markets in which the Properties in Operation are located. ENVIRONMENTAL REGULATIONS Under various federal, state and local laws, ordinances and regulations relating to the protection of the environment (collectively, "Environmental Laws"), a current or previous owner or operator of real estate may be liable for the cost of removal or remediation of certain hazardous or toxic substances disposed, stored, released, generated, manufactured or discharged from, on, at, onto, under or in such property. Environmental Laws often impose such liability without regard to whether the owner or operator knew of, or was responsible for, the presence or release of such hazardous or toxic substances. In addition, the presence of any such substances or the failure to properly remediate such substances when present, released or discharged may adversely affect the owner's ability to sell or rent such property or to borrow using such property as collateral. The cost of any required remediation 11 and the liability of the owner or operator therefor as to any property is generally not limited under such Environmental Laws and could exceed the value of the property and/or the aggregate assets of the owner or operator. Persons who arrange for disposal of hazardous or toxic substances may also be liable for the costs of removal or remediation of such substances at a disposal or treatment facility, whether or not such facility is owned or operated by such persons. In addition to any action required by federal, state or local authorities, the presence of hazardous or toxic substances on any of the Properties, or on any properties acquired hereafter, could result in private plaintiffs bringing claims for personal injury or other causes of action. In connection with the ownership and operation of the Properties, and with respect to any properties acquired hereafter, the Company may be potentially liable for remediation, release or injury. Further, various Environmental Laws impose on owners or operators the requirement of ongoing compliance with rules and regulations regarding business-related activities that may affect the environment. Failure to comply with such requirements could result in difficulty in the lease or sale of any affected Property or the imposition of monetary penalties and fines in addition to the costs required to attain compliance. All of the Properties in Operation have been subject to Phase I Environmental Assessments ("Phase I Assessments"). The Phase I Assessments did not reveal, nor is the Company aware of, any non- compliance with Environmental Laws, environmental liability or other environmental claim that the Company believes would likely have a material adverse effect on the Company. Although certain environmental issues have been identified with respect to certain of the Properties, the Company does not believe that any of these issues is likely to materially adversely affect the results of the Company's operations. No assurance can be given that the Phase I Assessments revealed all potential environmental liabilities, that no prior owner or operator created any material adverse environmental condition not known to the Company, that no environmental liabilities have developed since such Phase I Assessments were prepared, that future laws, ordinances or regulations will not impose any material environmental requirement or liability, or that a material adverse environmental condition does not otherwise exist. ITEM 2. PROPERTIES The Properties in Operation, as of December 31, 1997, consisted of 297 industrial and 144 office properties. Single tenants occupy 154 Properties in Operation. The Company provides a reduced level of service in connection with the operation or maintenance of these properties. The remaining 287 of the Company's Properties in Operation are occupied by multiple tenants for which the Company renders a range of building, operating and maintenance services. The Company's industrial properties consist of a variety of warehouse, assembly, light manufacturing, distribution and research and development facilities. Substantially all of the Company's industrial properties are located in suburban, mixed-use developments or business parks and all are well-maintained facilities. They include both single- tenant and multi-tenant facilities, with most designed flexibly to accommodate various types of tenants, space requirements, and industrial uses to increase re-leasing opportunities and control re-leasing costs. They range in size from 11,600 leaseable square feet to 1,190,000 leaseable square feet, with an average building size of 79,766 leaseable square feet. As of December 31, 1997, the Company's industrial 12 properties were 94.7% leased. Major tenants, based upon annual base rent, include the DSC Logistics, Inc., Hewlett-Packard Company, Vistakon Division of Johnson & Johnson Vision Products, Inc. and SKF USA, Inc. The Company's office properties are mid-rise and single story office buildings principally located in suburban, mixed-use developments or office parks. All of the Company's office properties are well- maintained facilities. Substantially all are located in prime business locations within established business communities offering excellent access to interstate highway systems. As of December 31, 1997, the office properties were approximately 94.5% leased. The office properties range in size from 2,800 leaseable square feet to 634,359 leaseable square feet, with an average building size of 60,853 leaseable square feet. Major tenants, based upon annual base rent, include AT&T Resource Management Corp., The Vanguard Group, Prudential Insurance Company of America and the Government of the United States of America. The table on the following pages sets forth certain information on the Company's Properties in Operation as of December 31, 1997. 13
LIBERTY PROPERTY TRUST/LIBERTY PROPERTY LIMITED PARTNERSHIP PROPERTY LIST PERCENT LEASED AT BUILDING YEAR LEASEABLE DEC. 31, NO. OF PROJECT NAME TYPE DEVE. SQ.FT.(1) 1997 (2) LEASES MAJOR TENANT - --------------------------------- --------- ----- --------- --------- ------ ------------------------------- SOUTHEASTERN PENNSYLVANIA 10, 20 Liberty Boulevard Ofc. 1985 62,237 98.1% 24 Great Valley Health Club, Inc. 420 Lapp Road Ind.-Flex 1989 92,250 99.6% 9 Akzo Coatings, Inc. 1 Chelsea Parkway Ind.-Flex 1989 43,267 99.0% 6 Valtek Incorporated 3 Chelsea Parkway Ind.-Flex 1989 43,240 43.6% 2 United Engineers & Constructors 747 Dresher Road Ofc. 1988 53,200 100.0% 2 Axon Communications, Inc. 45-67 Great Valley Parkway Ind.-Dist. 1974 128,001 100.0% 7 Taylor Publishings Company 1180 Church Road Ind.-Dist. 1986 452,323 56.3% 3 Safeguard Business Systems, Inc. 40 Valley Stream Parkway Ofc. 1987 31,092 100.0% 1 Sanchez Computer Associates 50 Valley Stream Parkway Ofc. 1987 31,000 100.0% 3 Sanchez Computer Associates 20 Valley Stream Parkway Ofc. 1987 58,837 100.0% 11 Shared Medical Systems 800 Town Center Drive Ind.-Flex 1987 141,714 91.3% 15 ICT Group, Inc. 1610 Medical Drive Ofc. 1986 38,100 54.4% 5 Employers Mutual Casualty Co. 11, 15 Great Valley Parkway Ofc. 1986 156,800 100.0% 2 Sanofi Winthrop, Inc. 257-275 Great Valley Parkway Ind.-Flex 1983 71,285 90.1% 6 KPMG Enterprise Integration 300 Technology Drive Ind.-Dist. 1985 22,500 100.0% 1 Nilfisk of America, Inc. 277-293 Great Valley Parkway Ind.-Flex 1984 28,800 84.4% 6 Alpha Scientific Corporation 311 Technology Drive Ofc. 1984 29,350 100.0% 3 Sherwin-Williams Co. 325 Technology Drive Ofc. 1984 25,000 100.0% 1 Premier Solutions Ltd. 7 Great Valley Parkway Ofc. 1985 59,021 100.0% 13 Executive Office Link 55 Valley Stream Parkway Ofc. 1983 40,057 100.0% 2 Meridian Asset Management Inc. 65 Valley Stream Parkway Ofc. 1983 58,220 100.0% 8 Liberty Property Trust 508 Lapp Road Ind.-Dist. 1984 50,200 100.0% 1 Numar Corporation 10 Valley Stream Parkway Ofc. 1984 33,027 100.0% 8 West Chester Administrative 333 Phoenixville Pike Ind.-Dist. 1985 84,000 100.0% 1 Veterans Life Insurance Co. 1566 Medical Drive Ofc. 1985 28,540 80.8% 4 General Physics Corporation 30 Great Valley Parkway Ind.-Dist. 1975 12,000 100.0% 1 Sanofi Winthrop, Inc. 75 Great Valley Parkway Ind.-Dist. 1977 11,600 100.0% 1 York International Corp. 27-43 Great Valley Parkway Ind.-Flex 1977 60,623 100.0% 5 Sanofi Winthrop, Inc. 77-123 Great Valley Parkway Ind.-Flex 1978 104,095 99.3% 19 Durant Medical, Inc. 260 Great Valley Parkway Ind.-Dist. 1979 50,000 100.0% 1 American Parts Systems 256 Great Valley Parkway Ind.-Dist. 1980 56,160 100.0% 1 Centocor, Inc. 205 Great Valley Parkway Ind.-Dist. 1981 184,500 100.0% 4 General Electric Company 12,14,16 Great Valley Parkway Ofc. 1982 20,546 100.0% 3 Sanofi Winthrop, Inc. 155 Great Valley Parkway Ind.-Dist. 1981 71,200 100.0% 1 Ensoniq Corporation 333 Technology Drive Ofc. 1987 39,769 100.0% 1 Premier Solutions, Ltd. 510 Lapp Road Ind.-Dist. 1983 27,167 100.0% 1 Trugreen 181 Wheeler Court Ind.-Dist. 1979 100,000 84.7% 3 Pet Value International, Inc. 1100 Wheeler Way Ind.-Dist. 1979 40,915 100.0% 1 National Business Services, Inc. 60 Morehall Road Ofc. 1989 114,430 93.9% 1 Vanguard Group 905 Airport Road Ind.-Dist. 1988 128,588 100.0% 6 Arco Chemical Company 16 Cabot Boulevard Ind.-Dist. 1972 299,192 100.0% 1 White Consolidated Industries 1 Country View Road Ofc. 1982 48,900 100.0% 1 Systems & Computer Technology 2151 Cabot Boulevard Ind.-Dist. 1982 114,760 100.0% 1 Schwarz Paper Company 170 S. Warner Road Ofc. 1980 87,685 100.0% 6 AT&T Resources Management Corp. 190 S. Warner Road Ofc. 1980 87,500 100.0% 1 Electronic Data Systems Corp. 507 Prudential Road Ind.-Flex 1988 105,500 100.0% 1 Prudential Insurance Company 100 Witmer Road Ofc. 1995 139,546 100.0% 1 GMAC Mortgage Corporation 3100 Horizon Boulevard Ind.-Flex 1995 41,000 100.0% 1 Vtel Corporation 3300 Horizon Boulevard Ind.-Dist. 1996 92,000 100.0% 1 Central National-Gottesman, Inc. 3500 Horizon Boulevard Ind.-Flex 1996 65,579 100.0% 1 SmithKline Beechman Clinical 200 Chester Field Parkway Ofc. 1989 28,919 100.0% 3 Waverly, Inc. 767 Electronic Drive Ind.-Flex 1996 45,000 100.0% 1 Diversified Pharmaceutical Svc. 5 Country View Road Ofc. 1985 63,170 100.0% 2 HBO & Company of Georgia 3200 Horizon Boulevard Ind.-Flex 1996 60,000 100.0% 1 Fund/Plan Services, Inc. 3000 Horizon Boulevard Ind.-Flex 1997 43,235 100.0% 1 Nanosystems L.L.C. 111-195 Witmer Road Ofc. 1996 55,354 76.1% 11 Kulicke & Soffa Industries, Inc. 300 Welsh Road Ofc. 1983 23,461 100.0% 4 Delta Information System, Inc. 400 Welsh Road Ofc. 1983 36,723 97.3% 5 National Fraud Investigation 8801 Tinicum Boulevard Ofc. 1997 280,000 100.0% 1 PNC Bank, National Association 440 E. Swedesford Road Ofc. 1988 72,336 100.0% 9 Genex Services, Inc. 460 E. Swedesford Road Ofc. 1988 73,217 100.0% 8 Johnson-Matthey Investments 50 Morehall Road Ofc. 1997 117,000 100.0% 1 Vanguard Group 2 Walnut Grove Drive Ofc. 1989 81,846 99.4% 14 Toyota Motor Credit Corp. 200 Gibraltar Road Ofc. 1990 64,452 94.0% 11 Great West Life Assurance 220 Gibraltar Road Ofc. 1990 63,587 100.0% 1 Prudential Insurance Company 240 Gibraltar Road Ofc. 1990 63,587 100.0% 1 Prudential Insurance Company 151 S. Warner Road Ofc. 1980 84,066 99.4% 11 Paging Network of Philadelphia 1 Walnut Grove Drive Ofc. 1986 66,372 100.0% 1 Merck and Company, Inc. 3606 Horizon Boulevard Ind.-Flex 1997 31,000 100.0% 1 Spectaguard, Inc. 650 Swedesford Road Ofc. 1971 100,410 - - 680 Swedesford Road Ofc. 1971 100,352 99.6% 1 Vanguard Group 761 Fifth Avenue Ind.-Flex 1977 50,476 76.6% 3 DHL Airways, Inc. 771 Fifth Avenue Ofc. 1977 30,000 62.7% 4 Havpak, Inc. 1 Great Valley Parkway Ind.-Flex 1985 60,880 100.0% 4 Apollon, Inc. 5 Great Valley Parkway Ofc. 1983 65,161 97.7% 12 Our Freedom, Inc. 311 Sinclair Road Ind.-Dist. 1997 40,304 100.0% 1 Stores Automated Systems Inc. 181-187 Gibralter Road Ind.-Flex 1982 48,870 100.0% 2 Solid State Equipment Corp. 104 Rock Road Ind.-Flex 1974 51,375 100.0% 1 Alliant Techsystems 123-135 Rock Road Ind.-Flex 1975 37,500 100.0% 1 Penn Mutual 111-159 Gibralter Road Ind.-Flex 1981 62,992 93.6% 8 Bio/Data Corporation 161-175 Gibralter Road Ind.-Flex 1976 49,732 90.8% 6 Oppenheimer Precision Products 125-137 Gibralter Road Ind.-Flex 1978 42,000 100.0% 1 General Instrument Corp. 261-283 Gibralter Road Ind.-Flex 1978 60,000 79.8% 2 Reed Technology & Information 210-223 Witmer Road Ind.-Flex 1972 60,000 99.7% 8 The Butler Company 231-237 Gibralter Road Ind.-Flex 1981 60,000 100.0% 3 General Instrument Corp. 100 Gibralter Road Ofc. 1975 2,800 100.0% 2 Federal Expresss Corporation 101 Gibralter Road Ofc. 1977 56,845 100.0% 1 Advanta Corp. 506 Prudential Road Ofc. 1973 18,200 100.0% 1 Flam & Russell 113-123 Rock Road Ofc. 1975 37,500 100.0% 1 Penn Mutual 14 PERCENT LEASED AT BUILDING YEAR LEASEABLE DEC. 31, NO. OF PROJECT NAME TYPE DEVE. SQ.FT.(1) 1997 (2) LEASES MAJOR TENANT - --------------------------------- --------- ----- --------- --------- ------ ------------------------------- SOUTHEASTERN PENNSYLVANIA - Continued 101-111 Rock Road Ofc. 1975 37,884 100.0% 3 Ivax Industries, Inc. 120 Gibralter Road Ofc. 1980 49,118 100.0% 11 Argosy Partners, LP 110 Gibralter Road Ofc. 1979 59,069 98.4% 11 National Benefits, Inc. 100-107 Lakeside Drive Ofc. 1982 27,465 100.0% 1 Loral Aerospace Corp. 200-264 Lakeside Drive Ofc. 1982 54,623 51.3% 8 Coordinated Health Services, Inc. 300-309 Lakeside Drive Ofc. 1982 43,832 100.0% 1 TVSM, Inc. 400-445 Lakeside Drive Ofc. 1981 62,123 86.0% 2 Prudential Property & Casualty 201 Gibralter Road Ofc. 1983 46,697 100.0% 3 Prudential Ins. Co. of America 3600 Horizon Drive Ind.-Flex 1989 34,353 100.0% 1 Premier Dental Products Co, Inc. 3602 Horizon Drive Ind.-Flex 1989 22,820 100.0% 3 Home Health Corp. of America 400-500 Brandywine Parkway Ind.-Flex 1988 101,536 100.0% 10 Bell Atlantic Teleproducts 600 Brandywine Parkway Ind.-Flex 1988 79,815 99.2% 9 CoreStates Bank 14 Lee Boulevard Ind.-Flex 1988 89,026 92.4% 4 Vanduard Group 500 Chester Field Parkway Ofc. 1988 30,815 100.0% 2 Becket, Watkins and Assciates 300-400 Chester Field Parkway Ofc. 1988 50,383 100.0% 3 Amerisource Corporation --------- ------ Total Southeastern Pennsylvania 7,143,597 93.0% ========= ====== NEW JERSEY/DELAWARE 1805 Underwood Boulevard Ind.-Dist. 1973 14,383 100.0% 1 Uniscore, Inc. 150 Mid-Atlantic Parkway Ind.-Dist. 1973 30,873 100.0% 1 RBP, Inc. d/b/a Reynolds 18 Boulden Circle Ind.-Flex 1989 76,000 98.9% 11 Custom Computer Services, Inc. 501 Delran Parkway Ind.-Dist. 1988 49,500 47.0% 2 RMH Teleservices, Inc. 600 Delran Parkway Ind.-Dist. 1988 119,290 100.0% 2 Computer & Communication Info 1607 Imperial Way Ind.-Dist. 1973 80,000 100.0% 1 Dunkin' Donuts 1 Boulden Circle Ind.-Dist. 1986 43,200 100.0% 1 Norel Paper Corporation 31-55 Read's Way Ind.-Flex 1986 78,009 100.0% 2 Cigna Corp. 3 Boulden Circle Ind.-Dist. 1987 60,812 100.0% 1 Livingston Healthcare Services 5 Boulden Circle Ind.-Dist. 1987 119,653 100.0% 1 Brundage Distribution Corp. 601 Delran Parkway Ind.-Dist. 1988 57,930 100.0% 1 Keymar Warehouse, Inc. 51 Haddonfield Road Ofc. 1986 94,187 96.5% 22 Lehigh Press, Inc. 57 Read's Way Ind.-Flex 1985 53,600 81.4% 1 Wachovia Bank of Georgia 1370 Imperial Way Ind.-Dist. 1978 179,785 100.0% 1 National Distribution Centers 8 Stow Road Ind.-Flex 1988 34,911 100.0% 5 AT&T Resource Management 10 Stow Road Ind.-Flex 1988 29,722 68.5% 1 Trans World Airlines, Inc. 12 Stow Road Ind.-Flex 1988 21,200 100.0% 5 Future Electronics Corp. 14 Stow Road Ind.-Flex 1988 18,821 100.0% 2 Wiltel Communications Sys, Inc. 1300 Metropolitan Avenue Ind.-Dist. 1972 76,196 100.0% 1 Phoenix Display & Packaging 701A Route 73 South Ofc. 1987 94,521 99.1% 9 Fluor Daniel, Inc. 701C Route 73 South Ofc. 1987 27,813 87.6% 5 Prudential Property & Casualty 1008 Astoria Boulevard Ind.-Flex 1973 37,400 99.6% 7 ACSIS, Inc. 1475 Imperial Way Ind.-Dist. 1976 60,000 100.0% 1 Knauf Fiberglass, Inc. 3000 Atrium Way Ofc. 1987 110,115 75.0% 13 Atrium Executive Center, Inc. 750 Cardinal Drive Ind.-Dist. 1989 81,348 100.0% 1 Leslie's Poolmart 11000,15000,17000 Commerce Parkway Ind.-Flex 1985 100,170 98.1% 6 PHH Mortgage Services 12000,14000 Commerce Parkway Ind.-Flex 1985 68,000 99.6% 8 Simirex, Inc. 16000,18000 Commerce Parkway Ind.-Flex 1985 52,000 98.2% 4 PHH Mortgage Services Corp. 406 Lippincott Drive Ofc. 1990 40,000 95.5% 6 Logs Group, L.L.C. 234 High Hill Road Ind.-Dist. 1987 60,000 100.0% 1 Skyway Freight Systems, Inc. 231 Lake Drive Ind.-Dist. 1997 130,800 53.9% 2 M.A. Bruder & Sons, Inc. 101 Arlington Boulevard Ind.-Dist. 1996 154,675 100.0% 2 Heinz Bakery Products. 100 Berkeley Drive Ind.-Dist. 1990 67,000 100.0% 1 MCR Direct Mail, Inc. 301 Lippincott Drive Ofc. 1988 82,482 100.0% 2 Fluor Daniel, Inc. 303 Lippincott Drive Ofc. 1988 82,541 99.8% 4 Fluor Daniel, Inc. 510 Sharptown Road Ind.-Dist. 1984 40,156 100.0% 1 Day Products, Inc. 901 Route 73 Ofc. 1985 39,434 99.3% 4 Teknion, Inc. 1500 Route 73 North Ofc. 1988 61,687 80.0% 13 Prudential Securities, Inc. 512 Sharptown Road Ind.-Dist. 1984 58,000 100.0% 1 Trek Bicycle Corporation 15 Boulden Circle Ind.-Dist. 1997 101,470 100.0% 1 Ryder Integrated Logistics, Inc. 404 Lippincott Drive Ind.-Flex 1997 26,600 100.0% 1 State Farm Mutual Automobile 263 Quigley Boulevard Ind.-Dist. 1987 42,891 100.0% 8 Lamont Television Systems, Inc. 34 Blevins Drive Ind.-Flex 1987 50,022 100.0% 7 Panelmatic, Inc. 104 Gaither Drive Ind.-Dist. 1975 45,390 100.0% 1 Eptech Corporation 2 Lukens Drive Ind.-Flex 1988 43,315 100.0% 3 Ameristar Technologies 402 Lippincott Drive Ind.-Flex 1997 26,000 100.0% 1 First Trenton Indemnity 3000 Lincoln Drive Ind.-Flex 1983 65,547 81.1% 1 Test Technology 6000 Commerce Parkway Ind.-Flex 1985 54,032 88.8% 6 Information Access Co. 7000 Commerce Parkway Ind.-Flex 1984 60,000 100.0% 3 Pioneer, Inc. 8000 Commerce Parkway Ind.-Flex 1983 54,185 90.0% 3 Simirex, Inc. 9000 Commerce Parkway Ind.-Flex 1983 66,164 100.0% 4 AW Computer Systems 1000 Briggs Road Ind.-Flex 1986 40,946 84.9% 1 Bluestone Consulting, Inc. 1025 Briggs Road Ind.-Flex 1987 61,019 82.4% 5 Dale, Gesek, McWilliams & Sherman 2000 Crawford Place Ind.-Dist. 1986 73,453 51.0% 4 C.M.E. Conference & Video 1351 Metropolitan Avenue Ind.-Dist. 1986 43,755 100.0% 1 Ownings Corning, Inc. 650 Grove Road Ind.-Flex 1986 57,400 92.0% 5 De Val Whole Florist, Inc. 400 Grove Road Ofc. 1986 19,200 100.0% 4 Huntsman Polypropylene Corp. --------- ------ Total New Jersey/Delaware 3,617,603 93.3% ========= ====== LEHIGH VALLEY 1655 Valley Center Parkway Ofc. 1993 28,300 100.0% 2 Allstate Insurance Company 6560 Stonegate Drive Ind.-Dist. 1989 80,000 100.0% 2 Vitra Seating, Inc. 6370 Hedgewood Drive Ind.-Dist. 1990 110,000 100.0% 2 Caterpillar Logistics Svc, Inc. 6390 Hedgewood Drive Ind.-Dist. 1990 69,000 100.0% 2 Behr Processing Corporation 1495 Valley Center Parkway Ofc. 1990 43,770 100.0% 2 Ingersoll-Rand Company 6350 Hedgewood Drive Ind.-Dist. 1989 121,000 100.0% 2 Organon, Inc. 6330 Hedgewood Drive Ind.-Flex 1988 89,700 91.1% 6 Submicron Systems, Inc. 1550 Valley Center Parkway Ind.-Flex 1988 43,400 100.0% 7 Employee Benefit Plans, Inc. 1560 Valley Center Parkway Ind.-Flex 1988 51,400 100.0% 1 TIG Insurance Company 6580 Snowdrift Road Ind.-Dist. 1988 104,000 100.0% 1 Dana Corporation 1510 Valley Center Parkway Ind.-Flex 1988 48,208 99.2% 7 Visiting Nurses Association 1530 Valley Center Parkway Ind.-Flex 1988 46,400 100.0% 1 SKF USA, Inc. 15 PERCENT LEASED AT BUILDING YEAR LEASEABLE DEC. 31, NO. OF PROJECT NAME TYPE DEVE. SQ.FT.(1) 1997 (2) LEASES MAJOR TENANT - --------------------------------- --------- ----- --------- --------- ------ ------------------------------- LEHIGH VALLEY - Continued 6540 Stonegate Drive Ind.-Dist. 1988 120,000 100.0% 1 SKF USA, Inc. 974 Marcon Boulevard Ind.-Flex 1987 39,200 83.8% 5 Inter-Media Marketing 964 Marcon Boulevard Ind.-Flex 1985 39,200 100.0% 6 Health Spectrum Medical 764 Roble Road Ind.-Flex 1985 21,860 100.0% 1 Chemlawn Corporation 3174 Airport Road Ind.-Flex 1979 42,000 100.0% 1 Allentech, Inc. 2196 Avenue C Ind.-Flex 1980 31,140 100.0% 1 Lehigh University 2202 Hangar Place Ind.-Flex 1981 66,495 100.0% 4 Lofts Seed, Inc. 2201 Hangar Place Ind.-Flex 1987 52,300 100.0% 6 Pacesetter Enterprises, Inc. 954 Marcon Boulevard Ind.-Dist. 1981 24,000 100.0% 1 Merck & Co., Inc. 57 South Commerce Way Ind.-Flex 1986 76,400 100.0% 7 SKF USA, Inc. 754 Roble Road Ind.-Flex 1986 46,800 100.0% 6 Computer Design, Inc. 894 Marcon Boulevard Ind.-Flex 1986 28,800 100.0% 10 Spalding Company, Inc. 744 Roble Road Ind.-Flex 1986 46,800 100.0% 9 Flouro-Seal 944 Marcon Boulevard Ind.-Flex 1986 38,400 100.0% 12 Integrated Solutions, Inc. 1685 Valley Center Parkway Ofc. 1996 27,200 100.0% 2 General Accident Insurance Co. 6520 Stonegate Drive Ind.-Flex 1996 43,200 100.0% 4 Hub City, Inc. 7437 Industrial Boulevard Ind.-Dist. 1976 191,330 100.0% 2 Stuart Medical, Inc. 2041 Avenue C Ind.-Flex 1990 30,400 100.0% 3 BEF Corporation 2124 Avenue C Ind.-Dist. 1990 36,000 100.0% 1 Graybar Electric Co., Inc. 7339 Industrial Boulevard Ind.-Dist. 1996 215,000 100.0% 1 Cott Beverages USA, Inc. 7384 Penn Drive Ind.-Dist. 1988 112,000 100.0% 1 Wing Industries, Inc. 7144 Daniels Drive Ind.-Dist. 1975 300,312 100.0% 2 Simpson Paper Cmpany 7620 Cetronia Road Ind.-Dist. 1990 155,060 100.0% 3 Lehigh Group 939 Marcon Boulevard Ind.-Dist. 1980 315,000 100.0% 1 Fieldcrest Cannon Sure Fit, Inc. 100 Brodhead Road Ofc. 1990 47,765 81.9% 7 First Valley Bank 1455 Valley Center Parkway Ind.-Flex 1997 55,000 100.0% 2 Life Insurance Co. of No. America 1640 Valley Center Parkway Ofc. 1996 30,850 100.0% 1 Pennsylvania Cellular 1650 Valley Center Parkway Ofc. 1997 28,600 99.1% 3 Pennsylvania Cellular Nestle Way Ind.-Dist. 1997 1,190,000 100.0% 1 DSC Logistics, Inc. 83 South Commerce Way Ofc. 1989 18,983 56.9% 2 Nationwide Insurance 85 South Commerce Way Ofc. 1989 21,119 100.0% 2 Penn Del Directory Co. 87 South Commerce Way Ofc. 1989 22,653 100.0% 4 Versyss, Inc. 7248 Industrial Boulevard Ind.-Dist. 1988 497,000 100.0% 2 Dial Corporation 95 Highland Avenue Ofc. 1985 73,000 100.0% 6 Omnipoint Communications 236 Brodhead Road Ofc. 1994 45,097 100.0% 1 Fireman's Fund Insurance Co. 6620 Grant Way Ind.-Flex 1989 30,204 100.0% 1 Submicron Systems Corporation 7562 Penn Drive Ind.-Flex 1989 26,950 100.0% 6 ITC, Inc. 7277 Williams Avenue Ind.-Flex 1989 41,040 100.0% 3 National Packaging Systems, Inc. --------- ------ Total Lehigh Valley 5,062,336 99.4% ========= ====== MARYLAND 180 Admiral Cochrane Drive Ofc. 1989 128,236 96.0% 9 Columbia Medical Plan, Inc. 12000,001,040 Indian Creek Court Ind.-Flex 1986 185,776 100.0% 7 Biospherics, Inc. 190 Admiral Cochrane Drive Ofc. 1988 72,085 98.3% 11 Telespectrum 8280 Patuxent Range Drive Ind.-Dist. 1978 60,079 100.0% 2 Alcore, Inc. 7178 - 7180 Columbia Gateway Ind.-Flex 1987 88,895 99.9% 5 Nationsbank, N.A. 8730 Bollman Place Ind.-Dist. 1984 98,745 100.0% 1 Kraft Foodservice, Inc. 9770 Patuxent Woods Drive Ofc. 1986 35,520 100.0% 1 Delaware Coca-Cola 9780 Patuxent Woods Drive Ofc. 1986 22,720 100.0% 1 BBN Corporation 9790 Patuxent Woods Drive Ofc. 1986 25,345 100.0% 2 GTE Government Systems Corp. 9810 Patuxent Woods Drive Ofc. 1986 27,725 100.0% 2 Bolt, Beranek and Newman 9800 Patuxent Woods Drive Ofc. 1988 31,095 100.0% 3 Coca-Cola Company 9820 Patuxent Woods Drive Ofc. 1988 24,720 100.0% 1 Kraft Foods, Inc. 9830 Patuxent Woods Drive Ofc. 1986 30,800 100.0% 1 JP Foodservice, Inc. 9050 Red Branch Road Ind.-Dist. 1972 89,898 100.0% 8 Kemi Laboratories, Inc. 9101,9111,9115 Guilford Road Ind.-Flex 1984 52,004 100.0% 5 Sienna Biotech, Inc. 9125,9135,9145 Guilford Road Ind.-Flex 1983 85,804 62.3% 4 Federal Express Corporation --------- ------ Total Maryland 1,059,447 96.3% ========= ====== VIRGINIA 10 South Third Street Ofc. 1930 4,900 100.0% 1 Scribner, Messer, Brady & Wade 1751 Bluehills Drive Ind.-Dist. 1991 265,082 100.0% 1 Conopco, Inc. 4300 Carolina Avenue Ind.-Dist. 1985 218,554 100.0% 1 United States of America 301 Hill Carter Parkway Ind.-Dist. 1989 80,000 100.0% 1 Philip Morris Incorporated 4001 Carolina Avenue Ind.-Dist. 1935 35,200 100.0% 7 Shelcore, Inc. 5600-5626 Eastport Boulevard Ind.-Flex 1989 71,227 100.0% 5 Western Roto Engravers, Inc. 5650-5674 Eastport Boulevard Ind.-Dist. 1990 150,867 100.0% 4 Sterilization Services of VA 5700 Eastport Boulevard Ind.-Dist. 1990 100,336 100.0% 1 Merisel, Inc. 11020 Hull Street Road Ofc. 1987 5,172 100.0% 1 Patient First Corporation 3432 Holland Road Ofc. 1989 5,688 100.0% 1 Patient First Corporation 3001 Hungary Springs Road Ofc. 1984 11,235 68.0% 2 Lifenet 7760 Shrader Road Ofc. 1987 18,247 100.0% 2 Signet Bank 7740 Shrader Road Ofc. 1989 10,167 56.2% 3 Rector & Visitors of UVA 4880 Cox Road Ofc. 1995 59,948 100.0% 2 Saxon Mortgage, Inc. 5162 Valleypointe Parkway Ofc. 1993 25,000 100.0% 1 United States of America 4101-4127 Carolina Avenue Ind.-Dist. 1973 126,000 100.0% 1 Hamilton Hybar, Inc. 4201-4261 Carolina Avenue Ind.-Dist. 1975 288,000 100.0% 9 Crestar Bank 4263-4299 Carolina Avenue Ind.-Dist. 1976 180,000 100.0% 1 Open Plan Systems, Inc. 4301-4335 Carolina Avenue Ind.-Dist. 1978 162,000 100.0% 1 S&G Packaging Company, L.L.C. 4337-4379 Carolina Avenue Ind.-Dist. 1979 198,000 100.0% 2 The Goldberg Company, Inc. 4501-4549 Carolina Avenue Ind.-Dist. 1981 150,000 100.0% 2 Foxmeyer Drug Company 4551-4593 Carolina Avenue Ind.-Dist. 1982 151,800 100.0% 3 A.H. Robins Company, Inc. 4601-4643 Carolina Avenue Ind.-Dist. 1985 151,800 100.0% 2 T.E.U. Incorporated 4545-4583 Carolina Avenue Ind.-Dist. 1985 120,000 100.0% 1 Owens & Minor Medical, Inc. 4447-4491 Carolina Avenue Ind.-Dist. 1987 158,700 100.0% 1 Shelcore, Inc. 4401-4445 Carolina Avenue Ind.-Dist. 1988 158,700 100.0% 2 Media Post Marketing 12 S. Third Street Ofc. 1900 5,735 100.0% 1 Liberty Property Limited Ptnsp. 9601 Cosner Drive Ind.-Dist. 1995 128,500 100.0% 1 Simmons Company 315 Cardiff Valley Road Ind.-Dist. 1994 151,200 100.0% 1 Caterpillar Inc. 2300 East Parham Road Ofc. 1988 5,172 100.0% 1 Patient First Corporation 16 PERCENT LEASED AT BUILDING YEAR LEASEABLE DEC. 31, NO. OF PROJECT NAME TYPE DEVE. SQ.FT.(1) 1997 (2) LEASES MAJOR TENANT - --------------------------------- --------- ----- --------- --------- ------ ------------------------------- VIRGINIA - Continued 1347 Diamond Springs Road Ind.-Dist. 1980 99,260 49.2% 1 Wetsel Seed Company 5221 Valleypark Drive-Bldg A Ind.-Flex 1988 17,007 100.0% 1 RBX Holdings, Inc. 5228 Valleypointe Parkway-Bldg B Ind.-Flex 1988 14,477 53.1% 2 Allen-Bradley Company 5238 Valleypark Drive-Bldg C Ind.-Flex 1989 17,062 91.1% 5 MCI Telecommunications Corp. 5601-5609 Eastport Boulevard Ind.-Dist. 1996 150,000 100.0% 2 General Medical Corporation 5900 Eastport Boulevard Ind.-Dist. 1997 142,800 100.0% 1 Hewlett-Packard Company 4717-4729 Eubank Road Ind.-Dist. 1978 141,313 100.0% 3 Whithall-Robins 5251 Concourse Drive Ofc. 1997 19,680 89.9% 3 Acadia Elastomers Corporation 4263F Carolina Avenue Ind.-Dist. 1975 57,600 100.0% 3 Heflebower Transfer & Storage 4200 Oakleys Court Ind.-Dist. 1990 80,000 100.0% 1 Multiton Mic Corp. 1821 Battery Dantzler Road Ind.-Dist. 1990 129,600 100.0% 3 Flare Corporation 5000 Cox Road Ind.-Flex 1990 58,367 100.0% 6 Patient First Corporation 510 Eastpark Court Ind.-Flex 1989 51,874 100.0% 4 Power Distribution, Inc. 520 Eastpark Court Ind.-Dist. 1989 144,228 100.0% 5 Bunzl-Richmond, Inc. 600 Hewlett Packard Way Ind.-Dist. 1997 158,400 100.0% 1 Hewlett-Packard Company 500 Hewlett Packard Way Ind.-Dist. 1997 146,000 100.0% 1 Hewlett-Packard Company 4198 Cox Road Ofc. 1984 43,387 100.0% 11 Insurance Co. of North America 4510 Cox Road Ofc. 1990 72,509 100.0% 12 Massachusetts Mutual 2809 South Lynnhaven Road Ofc. 1987 62,924 100.0% 16 Cigna 200 Golden Oak Court Ofc. 1988 73,676 96.7% 15 Metro Information Services 208 Golden Oak Court Ofc. 1989 63,696 100.0% 14 Prudential Bache 1 Enterprise Parkway Ofc. 1987 64,297 100.0% 20 SAIC 22 Enterprise Parkway Ofc. 1990 72,404 88.0% 11 SAIC --------- ------ Total Virginia 5,077,791 98.4% ========= ====== THE CAROLINAS 4523 Green Point Drive Ind.-Dist. 1988 85,830 100.0% 1 Dry Storage Corporation 4501 Green Point Drive Ind.-Dist. 1989 90,049 91.6% 3 New Breed Leasing Corporation 4500 Green Point Drive Ind.-Dist. 1989 71,040 100.0% 6 Corporate Express of the South 2427 Penny Road Ind.-Dist. 1990 270,000 100.0% 1 Masco Corporation 4524 Green Point Drive Ind.-Dist. 1988 74,587 100.0% 4 Standard Register Company 4328,4336 Federal Drive Ind.-Dist. 1995 177,600 100.0% 2 United Parcel Service, Inc. 200 Centreport Drive Ofc. 1986 47,190 100.0% 17 MCI Telecommunications Corp. 4344 Federal Drive Ind.-Dist. 1996 92,425 100.0% 4 MAC Papers, Inc. 202 Centreport Drive Ofc. 1990 62,664 97.5% 4 Key Risk Management Services 4000 Piedmont Parkway Ofc. 1989 60,383 98.5% 21 New Breed Leasing Corporation 4380 Federal Drive Ind.-Dist. 1997 79,200 100.0% 3 Triad Health Alliance, Inc. 4388 Federal Drive Ind.-Flex 1997 32,400 100.0% 1 Abacon Telecommunications, Inc. 6532 Judge Adams Road Ind.-Dist. 1997 151,600 100.0% 1 IOMEGA Corporation 3860 Faber Place Ind.-Flex 1995 42,500 88.2% 2 Scientific Reasearch Corp. 4055 Faber Place Ofc. 1989 53,304 100.0% 12 Allstate Insurance Company 3820 Faber Place Ind.-Flex 1993 39,422 83.6% 6 Executone Information Sys, Inc. 440 Knox Abbott Drive Ofc. 1989 50,248 94.2% 13 SCE&G Company Alcoa Fujikura Facility Ind.-Dist. 1984 222,670 100.0% 1 Alcoa Fujikura 1320 Garlington Road Ind.-Dist. 1986 72,000 100.0% 1 Perrigo Company 9800 Twin Lakes Parkway Ind.-Flex 1994 40,000 72.0% 3 Time Warner 420 Park Avenue Ofc. 1986 46,489 87.2% 5 Geraghty & Miller, Inc. 111 Southchase Blvd. Ind.-Dist. 1989 169,042 - - 300 International Blvd. Ind.-Flex 1995 103,684 100.0% 1 Ronald and Carolyn Jones 1208 Eastchester Drive Ofc. 1988 56,937 61.4% 12 L.M. Berry & Company One Independence Pointe Ofc. 1982 87,754 100.0% 8 Builders Marts of America 55 Beattie Place Ofc. 1986 242,535 95.6% 14 Insignia Financial Group 75 Beattie Place Ofc. 1987 177,985 91.8% 24 Law Building --------- ------ Total The Carolinas 2,699,538 90.4% ========= ====== JACKSONVILLE 1730 Stebbins Drive Ind.-Dist. 1973 40,000 100.0% 1 Atlas Bag, Inc. 5911-5925 Richard Street Ind.-Flex 1977 40,000 100.0% 1 Vistakon Div.- Johnson & Johnson 8383-8385 Baycenter Road Ind.-Dist. 1973 40,000 100.0% 1 Parts House, Inc. 8775 Baypine Road Ofc. 1989 50,000 100.0% 1 AT&T Resource Management Corp. 8539 Western Way Ind.-Flex 1987 72,030 - - 6255 Lake Grey Boulevard Ind.-Flex 1987 94,174 96.5% 6 U.S. Telecom, Inc. - Sprint Serv. 6600-6660 Suemac Place Ind.-Dist. 1973 103,404 100.0% 5 American Flat Glass 6800-6850 Suemac Place Ind.-Dist. 1973 60,000 - - 8665, 8667, 8669 Baypine Road Ofc. 1987 63,118 100.0% 5 Blue Cross and Blue Shield 8540 Baycenter Road Ind.-Flex 1984 30,028 100.0% 1 Reichhold Chemicals 1200 Gulf Life Drive Ofc. 1984 179,274 94.2% 22 Stein Mart, Inc. 8400 Baymeadows Way Ind.-Flex 1987 43,547 100.0% 5 Respiflow, Inc.& M.K. Diabetics 8614 Baymeadows Way Ofc. 1986 16,000 100.0% 1 Allstate Insurance Company 5941-5975 Richard Street Ind.-Flex 1978 86,660 100.0% 1 Vistakon Div. - Johnson & Johnson 7970 Bayberry Road Ind.-Flex 1978 55,000 63.6% 3 Norandex, Inc. 6000-6030 Bowdendale Avenue Ind.-Flex 1979 83,330 100.0% 6 Vistakon Div. - Johnson & Johnson 7898 Baymeadows Way Ofc. 1979 42,149 100.0% 2 American Transtech, Inc. (AT&T) 5977-6607 Richard Street Ind.-Flex 1980 73,333 100.0% 1 Vistakon Div. - Johnson & Johnson 7910 & 7948 Baymeadows Way Ofc. 1980 52,505 100.0% 3 American Transtech, Inc. (AT&T) 7954 & 7960 Baymeadows Way Ofc. 1982 52,608 100.0% 2 American Transtech, Inc. (AT&T) 8787 Baypine Road Ofc. 1990 220,000 100.0% 1 AT&T Resource Management Corp. 7077 Bonneval Road Ofc. 1988 103,116 90.9% 23 Florida Windstorm Underwriting 4190 Belfort Road Ofc. 1986 105,664 88.0% 25 Executive Business Centers, Inc. 8011, 8021, 8031 Phillips Highway Ofc. 1987 81,962 81.0% 10 Southwest Signal Engineering 7020 AC Skinner Parkway Ind.-Flex 1996 42,184 100.0% 6 Intermedia Communications, Inc. 7022 AC Skinner Parkway Ind.-Dist. 1996 88,200 100.0% 2 Microtek Medical, Inc. 11777 Central Highway Ind.-Dist. 1985 50,000 - - 7016 AC Skinner Parkway Ind.-Flex 1996 39,350 100.0% 1 Georgia-Pacific Corporation 7018 AC Skinner Parkway Ind.-Flex 1997 92,815 92.6% 9 Physician Sales and Service 6620 Southpoint Drive Ofc. 1984 59,926 95.6% 18 LC Footwear, LLC 7980 Bayberry Road Ind.-Dist. 1978 50,000 100.0% 3 Blue Cross & Blue Shield 9600 Satellite Boulevard Ind.-Dist. 1989 48,000 100.0% 1 United Exposition Service Co. 9700 Satellite Boulevard Ind.-Dist. 1989 48,000 100.0% 3 Tilecera, Inc. 1902 Cypress Lake Drive Ind.-Dist. 1989 120,360 83.1% 2 Production Resource Group, LLC 8250 & 8256 Exchange Place Ind.-Flex 1985 52,380 100.0% 8 Colorvision International, Inc. 17 PERCENT LEASED AT BUILDING YEAR LEASEABLE DEC. 31, NO. OF PROJECT NAME TYPE DEVE. SQ.FT.(1) 1997 (2) LEASES MAJOR TENANT - --------------------------------- --------- ----- --------- --------- ------ ------------------------------- JACKSONVILLE - Continued 6600 Southpoint Parkway Ofc. 1986 56,460 100.0% 1 Humana Health Insurance Co. 6700 Southpoint Parkway Ofc. 1987 46,500 99.2% 7 Atlantic Mortgage & Inv. Corp. 4801 Executive Park Court - 100 Ind.-Flex 1990 60,000 100.0% 1 The Hamilton Group Ltd. 4801 Executive Park Court - 200 Ind.-Flex 1990 40,000 100.0% 6 The Florida Times-Union 4810 Executive Park Court Ind.-Flex 1990 40,000 100.0% 2 The Hamilton Group Ltd. 6602 Executive Park Court - 100 Ind.-Flex 1993 42,000 100.0% 2 The Hamilton Group Ltd. 6602 Executive Park Court - 200 Ind.-Flex 1993 32,000 100.0% 4 US Automated Pro 6631 Executive Park Court - 100 Ind.-Flex 1994 27,200 100.0% 1 Continental Cablevision 6631 Executive Park Court - 200 Ind.-Flex 1994 44,000 100.0% 4 AT&T Resource Management, Corp. 4815 Executive Park Court - 100 Ind.-Flex 1995 39,600 94.4% 4 Lucent Technologies 4815 Executive Park Court - 200 Ind.-Flex 1995 50,000 100.0% 4 Drake Studios 4825 Executive Park Court Ind.-Flex 1996 65,000 100.0% 5 Communication Test Design 4820 Executive Park Court Ind.-Flex 1997 60,000 28.0% 1 Deka Medical, Inc. 10511 & 10611 Satellite Boulevard Ind.-Flex 1985 76,800 91.7% 6 Fast Forward Trans Service 1400-1440 Central Florida Parkway Ind.-Dist. 1962 121,225 33.0% 1 National Gypsum Company --------- ------ Total Jacksonville 3,279,902 87.3% ========= ====== TAMPA 4001, 4051, 4101 Fowler Avenue Ind.-Flex 1987 101,227 100.0% 20 Musculoskeletal Institute 5501 Pioneer Park Boulevard Ind.-Dist. 1981 61,416 100.0% 5 Premdor Corporation 5502 Pioneer Park Boulevard Ind.-Dist. 1981 48,375 100.0% 3 Premdor Corporation 5690-5694 Crenshaw Street Ind.-Dist. 1979 87,095 100.0% 3 Florida Flooring Products, Inc. 3102,3104,3110 Cherry Palm Drive Ind.-Flex 1986 74,339 100.0% 12 Groundwater Technology, Inc. 8401-8408 Benjamin Road Ind.-Flex 1986 127,566 100.0% 17 Merck-Medco Rx Services 3501 Riga Boulevard Ind.-Flex 1987 57,220 100.0% 2 Customer Communications Center 111 Kelsey Lane Ind.-Flex 1990 60,200 100.0% 3 Westinghouse Electric Corp. 7930, 8010-20 Woodland Center Ind.-Flex 1990 89,758 96.7% 11 Intertel Communications, Inc. 7920 Woodland Center Boulevard Ind.-Flex 1997 52,627 100.0% 2 Promus Hotels 8154-8198 Woodland Center Ind.-Flex 1988 45,382 100.0% 15 Williams Telecommunications 8112-42 Woodland Center Ind.-Flex 1995 39,155 100.0% 2 American Express Travel 8212 Woodland Center Ofc. 1996 39,155 100.0% 1 Metropolitan Fiber Systems --------- ------ Total Tampa 883,515 99.7% ========= ====== SOUTH FLORIDA 1701 Clint Moore Blvd Ind.-Flex 1985 80,060 100.0% 2 Amitek Corporation 4555 Riverside Drive Ofc. 1988 67,056 100.0% 1 Implant Innovations, Inc. 2500 Metrocentre Boulevard Ofc. 1988 18,012 100.0% 2 Parent-Child Study 2540 Metrocenter Boulevard Ofc. 1988 12,419 19.4% 2 Flagship Financial Services 2541 Metrocentre Boulevard Ofc. 1988 10,964 100.0% 2 Centex Real Estate Corp. 2580 Metrocentre Boulevard Ofc. 1988 19,381 100.0% 2 Attorney's Title Insurance Fund 2581 Metrocentre Boulevard Ofc. 1988 14,309 79.4% 3 LRP Publications 5410 - 5430 Northwest 33rd Avenue Ind.-Flex 1985 65,868 92.6% 8 Da Vinci Systems, Inc. --------- ------ Total South Florida 288,069 93.8% ========= ====== MINNESOTA 2905 Northwest Boulevard Ind.-Flex 1983 84,765 100.0% 9 Deltak Corporation 2800 Campus Drive Ind.-Flex 1985 64,852 99.7% 5 Ciprico, Inc. 2955 Xenium Lane Ind.-Flex 1985 24,800 100.0% 2 Pharma Target, Inc. 9401-9443 Science Center Drive Ind.-Flex 1989 73,908 100.0% 7 Ameridata Inc. 6321-6325 Bury Drive Ind.-Flex 1988 72,965 100.0% 5 Ontrack Computer Systems 7115-7173 Shady Oak Road Ind.-Flex 1984 77,925 94.8% 16 Teddy Bear Child Care, Inc. 7660-7716 Golden Triangle Drive Ind.-Flex 1988 89,672 98.5% 8 Sick Optic-Electronik, Inc. 7400 Flying Cloud Drive Ind.-Flex 1987 32,137 100.0% 1 Mamac Systems, Inc. 330 Second Avenue Ofc. 1980 197,100 80.1% 50 General Services Administration 10301-10305 West 70th Street Ind.-Flex 1984 23,547 100.0% 3 Sci-Com Data Services, Ltd. 10321 West 70th Street Ind.-Flex 1984 28,372 100.0% 1 Pattern Processing, Inc. 10333 West 70th Street Ind.-Flex 1984 21,640 100.0% 1 Olympic Financial 10349-10357 West 70th Street Ind.-Flex 1985 53,912 100.0% 3 Augustine Medical, Inc. 10365-10375 West 70th Street Ind.-Flex 1985 56,877 100.0% 2 Viking Press 10393-10394 West 70th Street Ind.-Flex 1985 52,684 100.0% 2 Augustine Medical, Inc. 7078 Shady Oak Road Ind.-Flex 1985 67,041 100.0% 1 Laser Master Corp. 5600 & 5610 Rowland Road Ind.-Flex 1988 119,100 97.6% 11 GN Danavox, Inc. 2920 Northwest Boulevard Ind.-Flex 1997 81,935 31.3% 2 Dal Tile Corporation --------- ------ Total Minnesota 1,223,232 91.5% ========= ====== MICHIGAN 26911-26957 Northwestern Ofc. 1985 634,359 98.0% 33 RL Polk 1650 Research Drive Ofc. 1985 70,562 100.0% 6 Hughes Aircraft Company 1775 Research Drive Ofc. 1985 30,450 100.0% 1 New Venture Gear, Inc. 1875 Research Drive Ofc. 1986 30,305 100.0% 3 Avery International, Inc. 1850 Research Drive Ofc. 1986 72,229 88.3% 2 Budd Company, Inc. 1965 Research Drive Ofc. 1987 38,600 100.0% 3 Porsche Engineering Services 1960 Research Drive Ofc. 1987 38,600 100.0% 2 Square D Company 27260 Haggerty Road Ind.-Flex 1983 50,391 94.9% 13 Farmers Insurance Exchange 27200 Haggerty Road Ind.-Flex 1983 42,156 100.0% 6 Automotive Systems Laboratories 27280 Haggerty Road Ind.-Flex 1983 49,944 100.0% 17 3D Systems, Inc. 27220 Haggerty Road Ind.-Flex 1985 22,175 100.0% 1 Automotive Systems Laboratories 27240 Haggerty Road Ind.-Flex 1985 18,665 100.0% 3 Automotive Systems Laboratories 27300 Haggerty Road Ind.-Flex 1985 40,779 87.5% 6 Atoma International of America 1101 Allen Drive Ind.-Flex 1974 24,582 100.0% 1 Goldon Windows & Mirrors, Inc. 1151 Allen Drive Ind.-Flex 1974 41,200 100.0% 1 Effective Mailers, Inc. 1300 Rankin Street Ind.-Flex 1979 33,600 100.0% 1 Acme Mills Company 1350 Rankin Street Ind.-Flex 1979 28,000 100.0% 1 PPG Industries, Inc. 1376-1400 Rankin Street Ind.-Flex 1979 33,640 100.0% 4 Seaman-Patrick Paper Co. 1352-1374 Rankin Street Ind.-Flex 1979 38,400 100.0% 4 Ambrosi & Associates 1324-1346 Rankin Street Ind.-Flex 1979 33,600 100.0% 2 Coolidge Glass Company, Inc. 18 PERCENT LEASED AT BUILDING YEAR LEASEABLE DEC. 31, NO. OF PROJECT NAME TYPE DEVE. SQ.FT.(1) 1997 (2) LEASES MAJOR TENANT - --------------------------------- --------- ----- --------- --------- ------ ------------------------------- MICHIGAN - Continued 1301-1307 Rankin Street Ind.-Flex 1978 28,000 100.0% 2 Michelin North America, Inc. 1409 Allen Drive Ind.-Flex 1978 40,000 70.0% 7 Computer Support Technologies 1304 E Maple Road Ind.-Flex 1971 60,667 100.0% 1 The Veratex Corporation 1334 Maplelawn Road Ind.-Flex 1983 28,122 100.0% 1 Ovonic Battery Company, Inc. 1290 Maplelawn Road Ind.-Flex 1984 19,314 100.0% 1 AIP, Inc. 1070 Maplelawn Road Ind.-Flex 1982 15,520 100.0% 1 J. Austin Oil Company of Flint 950 Maplelawn Road Ind.-Flex 1982 32,980 100.0% 1 EG&G Structural Kinematics 894 Maplelawn Road Ind.-Flex 1986 32,868 100.0% 1 EG&G Structural Kinematics 1179 Maplelawn Road Ind.-Flex 1984 19,873 100.0% 1 The Stanley Works 1940 Norwood Drive Ind.-Flex 1983 19,644 100.0% 1 Olga's Kitchen, Inc. 1311-1331 Maplelawn Road Ind.-Flex 1986 28,384 100.0% 2 Sweet Ideas LP 2354 Bellingham Street Ind.-Flex 1990 19,775 100.0% 1 PGF Industries, Inc. 2360 Bellingham Street Ind.-Flex 1985 19,775 100.0% 1 United States Postal Service 1911 Ring Drive Ind.-Flex 1986 19,500 100.0% 1 Fitzpatrick Manufacturing Co. 26442-26450 Haggerty Road Ind.-Flex 1988 29,800 100.0% 2 The Office Connection 26500 Haggerty Road Ind.-Flex 1986 52,000 100.0% 2 Cooper Tire & Rubber Company 26650 Haggerty Road Ind.-Flex 1988 26,800 100.0% 1 Inalfa Hollandia 26700 Haggerty Road Ind.-Flex 1986 39,200 100.0% 1 Inalfa Hollandia 26750 Haggerty Road Ind.-Flex 1988 29,800 100.0% 1 Hella North America, Inc. 26800 Haggerty Road Ind.-Flex 1986 22,000 100.0% 1 Fata Hunter, Inc. 26842-26850 Haggerty Road Ind.-Flex 1988 24,400 100.0% 2 Akebono BSEC, Inc. --------- ------ Total Michigan 1,980,659 98.0% ========= ====== UNITED KINGDOM 25 Kings Hill Avenue Ofc. 1996 35,000 93.9% 2 Charities Aid Foundation 2 Kings Hill Avenue Ind.-Flex 1996 34,600 86.3% 5 Broadcast Surveillance Systems 50 Gibson Drive Ofc. 1940 18,000 100.0% 1 Genzyme Biochemicals 50 Kings Hill Avenue Ofc. 1996 50,000 100.0% 1 Rhone-Polenc Rorer ---------- ------ Total United Kingdom 137,600 95.0% ========== ====== TOTAL COMPANY 32,453,289 94.6% ========== ======
(1) Based on current net leaseable building area. Some buildings have been expanded since their original acquisition or development. (2) Based on rent commencement date. 19 ITEM 3. LEGAL PROCEEDINGS The Trust is not a party to any material legal proceedings. In the ordinary course of business, the Operating Partnership is party to routine litigation incidental to its business, including routine actions for negligence, personal injury or other claims, many of which are expected to be covered by liability insurance and in the aggregate are not expected to have a material effect on the business or financial condition of the Company. On June 27, 1995, the Environmental Protection Agency ("EPA") notified Willard G. Rouse III, George F. Congdon and David C. Hammers, together with six other companies or individuals, that they may be potentially responsible, as former owners, for a portion of the response costs for remediation of ground water in part of the North Penn Service Area for certain properties located in Upper Gwynedd Township, Pennsylvania, (the "Church Road Properties"). The Company acquired the Church Road Properties from the Predecessor upon formation of the Company. The Company has not been similarly notified by the EPA; however, as the present owner of the Church Road Properties, the potential exists for the Company to be named a potentially responsible party if there has been a release from the Church Road Properties of hazardous substances, including trichloroethylene, that requires remediation. In such circumstances, the Company believes it would have claims against other financially responsible parties (including previous owners of the Church Road Properties, such as Zenith and the other parties identified by the EPA as potentially liable) and, consequently, the Company does not believe that its liability with respect to this matter, if any, is likely to be material. In addition, Mr. Rouse, Mr. Congdon, Mr. Hammers and Joseph P. Denny have agreed to indemnify the Company for a period of 10 years commencing in June 1994 with respect to material environmental liabilities associated with the Church Road Properties. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year ended December 31, 1997. EXECUTIVE OFFICERS The following persons are the executive officers of the Trust, which is the sole general partner of the Operating Partnership:
AGE AT FEBRUARY POSITION NAME 25, 1998 - ----------------------- -------- ----------------------------------------------- Willard G. Rouse III 55 Chairman of the Board of Trustees and Chief Executive Officer Joseph P. Denny 51 President, Chief Operating Officer and Trustee George J. Alburger, Jr. 50 Chief Financial Officer and Treasurer George F. Congdon 55 Executive Vice President and Trustee Robert E. Fenza 40 Executive Vice President James J. Bowes 44 Secretary and General Counsel
20 Each officer was elected as such in July 1994 with the exception of Mr. Alburger who was elected Chief Financial Officer and Treasurer in May 1995, and Mr. Bowes who was elected Secretary in December 1996. Each officer will serve until the first meeting of the Board of Trustees after the next annual meeting of shareholders or until the officer resigns or is removed from office by the Board of Trustees. Willard G. Rouse III has served as Chairman of the Board of Trustees and Chief Executive Officer of the Company since March 1994. Mr. Rouse had been a General Partner of the Predecessor since its founding in 1972. Mr. Rouse has served as Chairman of each of the Pennsylvania Convention Center Authority, Foundation for Architecture, We the People 2000 and the Philadelphia Children's Network and as President of the Fellowship Commission. Mr. Rouse is currently Chair of The Regional Performing Arts Center. Joseph P. Denny has served as President and Chief Operating Officer of the Company and a trustee of the Trust since March 1994. Mr. Denny joined the Predecessor in 1979 and served as a Regional Managing General Partner, and later as President. In these capacities, he was responsible for developing approximately one billion dollars of projects, primarily large urban projects. Mr. Denny is a member of the Industrial and Office Park Council of the Urban Land Institute and serves on the Advisory Board of the Wharton Business School's Real Estate Center and the NAREIT Legislative Advisory Council. George J. Alburger, Jr. became Chief Financial Officer and Treasurer of the Company in May 1995. For more than five years prior to joining the Company, Mr. Alburger served as Executive Vice President of EBL&S Property Management, Inc., an owner and manager of approximately 200 shopping centers aggregating 30 million square feet of retail space. Mr. Alburger is a certified public accountant and was formerly a Senior Manager with Price Waterhouse LLP. George F. Congdon has served as a trustee of the Trust since March 1994, and as an Executive Vice President of the Company since April 1995. Mr. Congdon previously served as Chief Financial Officer and Treasurer of the Company. Mr. Congdon had been a General Partner of the Predecessor since its founding in 1972. He is a member of the Board of Directors of the People's Light and Theater Company and Historic Yellow Springs, Inc. Robert E. Fenza has served as an Executive Vice President of the Company since March 1994, with principal responsibility for operations, property management and asset management. Mr. Fenza joined the Predecessor in 1984 and advanced to Regional Manager in 1987 and to Northern Division Manager in 1991. James J. Bowes has served as General Counsel and Secretary of the Company since December 1996. Prior to joining the Company, Mr. Bowes was a partner in the law firm of Blank Rome Comisky & McCauley. PART II ITEM 5. MARKET FOR THE REGISTRANTS' COMMON EQUITY AND RELATED SHAREHOLDERS MATTERS The Common Shares are traded on the New York Stock Exchange under the symbol "LRY". There is no established public trading market for the Units. The following table sets forth, for the calendar quarters 21 indicated, the high and low closing prices of the Common Shares on the New York Stock Exchange, and the dividends declared per Common Share for such calendar quarter. DIVIDENDS DECLARED PER HIGH LOW COMMON SHARE ---- --- ------------- 1996 First Quarter $22 1/8 $20 1/4 $0.40 Second Quarter 21 19 1/2 0.40 Third Quarter 21 3/4 19 3/8 0.41 Fourth Quarter 25 7/8 21 1/8 0.41 1997 First Quarter $26 1/8 $23 3/4 $0.41 Second Quarter 25 1/2 23 5/8 0.41 Third Quarter 27 1/8 24 3/4 0.42 Fourth Quarter 28 7/8 25 1/2 0.42 As of February 25, 1998, the Common Shares were held by 561 holders of record. Since its initial public offering, the Company has paid regular and uninterrupted dividends. Although the Company currently anticipates that comparable cash dividends will continue to be paid in the future, the payment of future dividends by the Company will be at the discretion of the Board of Trustees and will depend on numerous factors including the Company's cash flow, its financial condition, capital requirements, annual distribution requirements under the REIT provisions of the Internal Revenue Code of 1986, as amended, and such other factors as the Board of Trustees deems relevant. ITEM 6. SELECTED FINANCIAL DATA The following table sets forth Selected Financial Data for Liberty Property Trust and Liberty Property Limited Partnership as of and for the years ended December 31, 1997, 1996 and 1995 and for the period from June 23, 1994 to December 31, 1994, for Liberty Property Trust, Liberty Property Limited Partnership and the Predecessor combined as of and for the year ended December 31, 1994, and for the Predecessor for the period from January 1, 1994 to June 22, 1994, and for the year ended 1993. The information set forth below should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements and notes thereto appearing elsewhere in this report. Certain amounts from prior periods have been restated to conform to current year presentation. 22
LIBERTY PROPERTY TRUST/LIBERTY PROPERTY LIMITED PARTNERSHIP AND PREDECESSOR (COMBINED) LIBERTY PROPERTY TRUST/ LIBERTY PROPERTY LIMITED PARTNERSHIP/ LIBERTY PROPERTY TRUST/ PREDECESSOR LIBERTY PROPERTY LIMITED PARTNERSHIP PREDECESSOR COMBINED PREDECESSOR ------------------------------------------------ ----------- ----------- ----------- YEAR YEAR YEAR JUNE 23, JANUARY 1, YEAR ENDED ENDED ENDED ENDED 1994 TO 1994 to YEAR ENDED DECEMBER 31, DECEMBER DECEMBER DECEMBER DECEMBER JUNE DECEMBER ----------- 31, 1997 31, 1996 31, 1995 31, 1994 22, 1994 31, 1994 1993 ---------- ---------- ---------- ----------- ----------- ----------- ----------- (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) OPERATING DATA Total Revenue $ 232,517 $ 154,265 $ 117,041 $ 46,638 $ 36,384 $ 83,022 $ 75,440 Rental and real estate tax expense 61,079 40,853 29,314 11,377 10,373 21,750 19,319 General and administra- tive expenses 10,650 8,023 5,212 2,273 2,439 4,712 5,135 Depreciation and amortization 40,752 28,203 22,518 8,294 6,438 14,732 13,375 ---------- ---------- --------- --------- -------- --------- -------- Operating income 120,036 77,186 59,997 24,694 17,134 41,828 37,611 Premium on debenture conversions 98 1,027 - - - - - Interest expense 53,888 38,528 37,688 13,826 20,417 34,243 45,231 ---------- ---------- --------- --------- -------- --------- -------- Income (loss) before minority interest and extraordinary item 66,050 37,631 22,309 10,868 (3,283) 7,585 (7,620) Minority interest 5,606 3,891 2,843 7,664 - 7,664 - Extraordinary item-gain on extinguishment of debt - - - 52,677 3,084 55,761 - ---------- ---------- --------- --------- -------- --------- -------- Net income (loss) 60,444 33,740 19,466 55,881 (199) 55,682 (7,620) ---------- ---------- --------- --------- -------- --------- -------- Preferred dividends 4,247 - - - - - - ---------- ---------- --------- --------- -------- --------- -------- Income available to common shareholders $ 56,197 $ 33,740 $ 19,466 $ 55,881 $ (199) $ 55,682 $ (7,620) ========== ========== ========= ========= ======== ========= ======== Common dividends paid $ 70,615 $ 52,569 $ 38,683 $ 10,219 - - - ========== ========== ========= ========= Preferred dividends paid $ 2,414 - - - - - - ========== PER SHARE DATA Income per common share before extraordinary item - basic $ 1.39 $ 1.14 $ 0.89 $ 0.46 - - - Income per common share - basic $ 1.39 $ 1.14 $ 0.89 $ 2.67 - - - Income per common share before extraordinary item - diluted $ 1.38 $ 1.14 $ 0.89 $ 0.27 - - - Income per common share - diluted $ 1.38 $ 1.14 $ 0.89 $ 1.91 - - - Dividends paid per common share $ 1.65 $ 1.61 $ 1.60 $ 0.43 - - - Dividends paid per preferred share $ 0.48 - - - - - - Weighted average number of shares outstanding - basic 40,493 29,603 21,833 20,965 - - - Weighted average number of shares outstanding - diluted 40,806 29,678 21,838 35,386 - - - OTHER DATA Cash provided by opera- ting activities $ 126,860 $ 64,378 $ 55,321 $ 31,782 $ 7,050 $ 38,832 $ 9,655 Cash used by investing activities (854,871) (265,427) (281,862) (154,273) (2,009) (156,282) (5,850) Cash provided (used) by financing activities 763,478 210,032 212,001 136,855 5,526 142,381 (3,213) Funds from operations 102,617 65,944 44,606 19,082 3,075 22,517 5,595
23
LIBERTY PROPERTY TRUST/ PREDECESSOR LIBERTY PROPERTY LIMITED PARTNERSHIP ------------ ---------------------------------------------------------- DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, ------------ 1997 1996 1995 1994 1993 ------------ ------------ ------------ ------------ ------------ (DOLLARS IN THOUSANDS) BALANCE SHEET DATA Net real estate $ 1,947,026 $ 1,059,562 $ 826,047 $ 512,281 $ 370,438 Total assets 2,094,337 1,152,612 898,102 602,981 413,629 Total long term indebtedness 960,134 678,709 473,909 320,857 523,576 Shareholders' and owners' equity (deficit) 955,595 375,532 335,521 229,667 (150,987) OTHER DATA Total leaseable square foot- age of properties at end of period (in thousands) 32,453 20,617 16,693 11,090 8,054 Number of properties at the end of period 441 259 208 151 113 Percentage leased at end of period 95% 93% 92% 88% 93%
The income per common share amounts prior to 1997 have been restated as required to comply with Statement of Financial Accounting Standards No. 128, "Earnings per Share". For further discussion of income per common share and the impact of Statement No. 128, see the notes to the consolidated financial statements. Basic weighted average number of shares outstanding excludes Common Shares issuable upon the conversion of Units, upon the exchange of the Exchangeable Subordinated Debentures Due 2001 of the Operating Partnership (the "Convertible Debentures") (subject to adjustment upon the occurrence of certain events) and upon the exercise of outstanding options. Diluted weighted average number of shares outstanding includes the dilutive effect of outstanding options, and excludes Common Shares issuable upon conversion of Units, and upon the exchange of Convertible Debentures (subject to adjustment upon the occurrence of certain events), because to do so would have been antidilutive for the periods presented, with the exception of the period June 23, 1994 to December 31, 1994. The diluted weighted average shares for this period includes the dilutive effect of all of the aforementioned securities. "Funds from Operations" is defined by the National Association of Real Estate Investment Trusts ("NAREIT") as net income or loss after preferred dividends (computed in accordance with generally accepted accounting principles ("GAAP"), excluding gains (or losses) from debt restructuring and sales of property, plus real estate-related depreciation and amortization and minority interest, and excluding significant non-recurring events that materially distort the comparative measurement of Company performance over time. Funds from Operations does not represent cash generated from operating activities in accordance with GAAP and is not necessarily indicative of cash available to fund cash needs. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW In 1997, the Company continued to pursue acquisition and development opportunities and to focus on increasing the cash flow from its Properties in Operation by increasing property occupancy and increasing rental rates. The Company also continued to strengthen its balance sheet and its capital structure. 24 The Company's operating results depend primarily upon income from the rental operations of the Properties in Operation. This income is substantially influenced by the demand for the Company's Properties in Operation. In addition, the Company's continued growth is dependent upon its ability to maintain property occupancy rates and increase rental rates on the Properties in Operation and to continue development and acquisition of additional properties. The occupancy rate of the Properties in Operation has increased during the last two years and was 94.6% at December 31, 1997. The Company will seek to maintain and increase its overall occupancy and also will seek to increase rental rates in replacement and renewal leases. Stable or increased occupancy, along with increasing rental rates would allow the Properties in Operation to continue to provide a comparable or increasing level of earnings from rental operations. The Company also will seek to achieve growth in earnings from rental operations through (i) the acquisition of additional rental properties in its primary markets; (ii) the expansion into selected new markets; and (iii) the maintenance and expansion of its development pipeline. The Company acquired 170 properties consisting of 9.5 million leaseable square feet during 1997 as compared to the acquisition of 33 properties consisting of 2.4 million leaseable square feet during 1996. The Company anticipates continuing to pursue the acquisition of rental properties but notes that the competition for acquisitions has been increasing and that the initial return may be decreasing. The Company will seek through its active pursuit of acquisitions in its multiple markets to continue to achieve attractive returns on acquisitions. The Company also increased its level of development activity in 1997. In 1997, the Company completed 20 projects totalling approximately 2.9 million leaseable square feet for a Total Investment of $143.5 million. In addition, as of December 31, 1997, the Company had 43 properties expected to generate approximately 4.1 million leaseable square feet of suburban office and industrial space under development which represents an estimated Total Investment of $304.9 million. The Company expects to complete the Properties Under Development over the next eight quarters. The Company continued to strengthen its balance sheet in 1997 by accessing both the public and private equity markets and the public debt market. The Company raised approximately $433.9 million through the issuance of Common Shares and $120.8 million through the issuance of preferred shares of beneficial interest. In addition, over the course of the year, the Company issued $350.0 million of investment grade rated unsecured notes with maturities ranging from six to 10 years. The Company expects to continue to strengthen its capital structure. IMPACT OF YEAR 2000 The Year 2000 issue continues to receive a significant amount of publicity and attention. The issue is the result of computer programs being written using two digits rather than four digits to define the applicable year. If problematic and not corrected, many computer applications could fail or create erroneous results by or at the Year 2000. The Company's property management and accounting system uses four digit year fields. The Company has been reviewing and will continue to review its building operating systems on a building by building basis in conjunction with its annual maintenance program. The Company, based on the present status of its systems and the results of the reviews completed to date, believes any amount required to remediate any Year 25 2000 issues will not be material to the Company's business, operations or financial conditions. FORWARD-LOOKING STATEMENTS When used throughout this report, the words "believes," "anticipates," and "expects" and similar expressions are intended to identify forward- looking statements. Such statements indicate that assumptions have been used that are subject to a number of risks and uncertainties which could cause actual financial results or management plans and objectives to differ materially from those projected or expressed herein, including: the effect of national and regional economic conditions; the Company's ability to identify and secure additional properties and sites that meet its criteria for acquisition or development; the acceptance of the Company's financing plans by the capital markets; and the effect of prevailing market interest rates and the pricing of the Company's shares of beneficial interest; and other risks described from time to time in the Company's filings with the Securities and Exchange Commission. Given these uncertainties, readers are cautioned not to place undue reliance on such statements. The Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect any future events or circumstances. The following discussion is based on the consolidated financial statements of the Company. It compares the results of operations of the Company for the year ended December 31, 1997 with the results of operations of the Company for the year ended December 31, 1996, and the results of operations of the Company for the year ended December 31, 1996 with the results of operations of the Company for the year ended December 31, 1995. As a result of the differing levels of acquisitions by the Company in 1997 and 1996, the overall operating results of the Company during such periods are not directly comparable. However, certain data, including the "Same Store" comparison, does lend itself to direct comparison. As used herein, the term "Company" includes the Trust, the Operating Partnership and their subsidiaries. RESULTS OF OPERATIONS COMPARISON OF YEAR ENDED DECEMBER 31, 1997 TO YEAR ENDED DECEMBER 31, 1996. Rental revenues increased from $154.3 million for the year ended December 31, 1996 to $232.5 million for the year ended December 31, 1997. This increase was primarily due to the increase in the number of properties owned during the respective periods. As of January 1, 1996, the Company owned 208 properties and, through December 31, 1996, acquired 33 additional properties and completed development on 19 properties for a Total Investment of $232.2 million. As of January 1, 1997, the Company owned 259 properties, and, through December 31, 1997, acquired 170 additional properties and completed the development on 20 properties for a Total Investment of $871.5 million, and disposed eight properties for $35.4 million. Operating expense reimbursement increased from $35.9 million for the year ended December 31, 1996 to $55.5 million for the year ended December 31, 1997. This increase is a result of the reimbursement from tenants for increases in rental property expenses and real estate taxes. The operating expense recovery percentage (the ratio of operating expense reimbursement to rental property expenses and real estate taxes) 26 increased from 87.8% for the year ended December 31, 1996 to 90.9% for the year ended December 31, 1997. Rental property and real estate tax expenses increased from $40.9 million for the year ended December 31, 1996 to $61.1 million for the year ended December 31, 1997. This increase is due to the increase in the number of properties owned. Property level operating income for the "Same Store" properties (properties owned since January 1, 1996) increased from $94.1 million for the year ended December 31, 1996 to $98.8 million for the year ended December 31, 1997. This increase of 5.01% is due to increases in rental rates and increases in occupancy. Set forth below is a schedule comparing the operating results for the Same Store properties for the years ended December 31, 1997 and 1996. 1997 1996 -------- -------- (IN THOUSANDS) ----------------------- Rental revenue $102,501 $ 98,275 Operating expense reimbursement 30,000 29,757 -------- -------- 132,501 128,032 Rental property expenses 24,221 24,480 Real estate taxes 9,437 9,426 -------- -------- Property level operating income $ 98,843 $ 94,126 ======== ======== General and administrative expenses increased from $8.0 million for the year ended December 31, 1996 to $10.7 million for the year ended December 31, 1997. This $2.7 million increase is due to the increase in personnel and other related overhead costs necessitated by the increase in the number of properties owned during the respective periods. This increase is somewhat mitigated by the benefit of certain economies of scale experienced by the Company in owning and operating the Properties. Depreciation and amortization expenses increased from $28.2 million for the year ended December 31, 1996 to $40.8 million for the year ended December 31, 1997. This increase is due to the increase in the number of properties owned during the respective periods. Interest expense increased from $38.5 million for the year ended December 31, 1996 to $53.9 million for the year ended December 31, 1997. This increase is due to an increase in the average debt outstanding for the respective periods which was $576.3 million in 1996 and $819.4 in 1997. This increase is partly offset by the lower interest rate on the outstanding debt. The reduction in interest rates was partially the result of the Company receiving investment grade ratings from both Standard & Poor's Rating Group ("S&P") and Moody's Investment Service, Inc. ("Moody") during the year which enabled the Company to access public debt markets more economically. As a result of the foregoing, the Company's operating income increased from $77.2 million for the year ended December 31, 1996 to $120.0 million for the year ended December 31, 1997. In addition, income 27 before minority interest increased from $37.6 million for the year ended December 31, 1996 to $66.1 million for the year ended December 31, 1997. COMPARISON OF YEAR ENDED DECEMBER 31, 1996 TO YEAR ENDED DECEMBER 31, 1995. Rental revenues increased from $117.0 million for the year ended December 31, 1995 to $154.3 million for the year ended December 31, 1996. This increase was primarily due to the increase in the number of properties owned during the respective periods. As of January 1, 1995, the Company owned 151 properties and, through December 31, 1995, acquired 52 additional properties (net of two properties exchanged in connection with such acquisitions) and completed development of five properties for a Total Investment of $223.1 million. As of January 1, 1996, the Company owned 208 properties, and, through December 31, 1996, acquired 33 additional properties and completed the development on 19 properties for a Total Investment of $232.2 million. Operating expense reimbursement increased from $24.6 million for the year ended December 31, 1995 to $35.9 million for the year ended December 31, 1996. This increase is a result of the reimbursement from tenants for increases in rental property expenses and real estate taxes. The operating expense recovery percentage (the ratio of operating expense reimbursement to rental property expenses and real estate taxes) increased from 83.9% for the year ended December 31, 1995 to 87.8% for the year ended December 31, 1996. Rental property and real estate tax expenses increased from $29.3 million for the year ended December 31, 1995 to $40.9 million for the year ended December 31, 1996. This increase is due to the increase in the number of properties owned. Property level operating income for the "Same Store" properties (properties owned since January 1, 1995) increased from $68.0 million for the year ended December 31, 1995 to $71.5 million for the year ended December 31, 1996. This increase of 5.1% is due to increases in rental rates and increases in occupancy. Set forth below is a schedule comparing the operating results for the Same Store properties for the years ended December 31, 1996 and 1995. 1996 1995 -------- -------- (IN THOUSANDS) ----------------------- Rental revenue $ 75,823 $ 72,808 Operating expense reimbursement 24,553 21,463 -------- -------- 100,376 94,271 Rental property expenses 21,023 18,191 Real estate taxes 7,878 8,086 -------- -------- Property level operating income $ 71,475 $ 67,994 ======== ======== General and administrative expenses increased from $5.2 million for the year ended December 31, 1995 to $8.0 million for the year ended December 31, 1996. This $2.8 million increase is due to the increase in personnel and other related overhead costs necessitated by the increase 28 in the number of properties owned during the respective periods. Included in the general and administrative expenses for the year ended December 31, 1996 is a $704,000 non-cash charge resulting from the amortization of a stock award over its vesting period. There is no corresponding charge for the year ended December 31, 1995. Depreciation and amortization expenses increased from $22.5 million in 1995 to $28.2 million in 1996. This increase is due to the increase in the number of properties owned during the respective periods. Interest expense increased from $37.7 million for the year ended December 31, 1995 to $38.5 million for the year ended December 31, 1996. This increase is due to an increase in the average debt outstanding for the respective periods which was $397.4 million in 1995 and $576.3 million 1996. This increase is partly offset by the lower interest rate on the outstanding debt because of the 1% reduction in interest rate on the Line of Credit borrowings which became effective on May 1, 1995, and because of a decrease in the outstanding Convertible Debentures due to the conversion of $58.7 million principal amount of Convertible Debentures in 1996. As a result of the foregoing, the Company's operating income increased from $60.0 million for the year ended December 31, 1995 to $77.2 million for the year ended December 31, 1996. In addition, income before minority interest increased from $22.3 million for the year ended December 31, 1995 to $37.6 million for the year ended December 31, 1996. LIQUIDITY AND CAPITAL RESOURCES As of December 31, 1997, the Company had cash and cash equivalents of $55.1 million. Net cash flow provided by operating activities increased from $64.4 million for the year ended December 31, 1996 to $126.9 million for the year ended December 31, 1997. This $62.5 million increase was primarily due to the additional cash flow generated by the greater number of properties in service during the latter period. Net cash used in investing activities increased from $265.4 million for the year ended December 31, 1996 to $854.9 million for the year ended December 31, 1997. This $589.5 million increase was a result of the increase in investment in acquisitions and development from $232.2 for the year ended December 31, 1996 to $871.5 million for the year ended December 31, 1997. Net cash provided by financing activities increased from $210.0 million for the year ended December 31, 1996 to $763.5 million for the year ended December 31, 1997. This increase was primarily attributable to the Follow-On Offering (as defined below), and the exercise of the related overallotment option, which were completed on March 24, 1997 and April 1, 1997, respectively, which resulted in the issuance of an aggregate of 8,250,000 Common Shares, the Preferred Offering (as defined below), which was completed on August 11, 1997, which resulted in the issuance of 5,000,000 preferred shares of beneficial interest, the Senior Notes Offering (as defined below), which was completed on August 19, 1997, which resulted in the issuance of $200 million principal amount of unsecured notes, the Common Shares Offering (as defined below), which was completed on November 19, 1997, which resulted in the issuance an aggregate of 9,200,000 Common Shares, the Direct Placement (as defined below), which was completed on December 11, 1997, which resulted in the issuance of 796,505 Common Shares and the issuance of $150 million 29 principal amount of unsecured notes in December. The net proceeds to the Company of these offerings were approximately $191.7 million, $120.8 million, $198.0 million, $222.2 million, $20.0 million and $149.0 million, respectively. The Company believes that its undistributed cash flow from operations is adequate to fund its short-term liquidity requirements. The Company funded its long-term liquidity requirements, such as property acquisition and development activities, primarily through secured line of credit facilities (the "Lines of Credit"). During the second quarter of 1997, the Company replaced these secured facilities with a $325.0 million unsecured line of credit (the "Credit Facility"). The interest rate on borrowings under the Credit Facility fluctuates based upon the Company's leverage levels or ratings from Moody's and S&P. On June 23, 1997, Moody's raised its prospective senior debt rating of the Company to Baa3 from Ba2 and on July 22, 1997, S&P assigned a BBB- prospective senior debt rating to the Company. At these ratings, the interest rate for borrowings under the Credit Facility is 110 basis points over the Eurodollar Rate. Periodically, the Company pays down borrowings on the Credit Facility with funds from long term capital sources. In the year ended December 31, 1997, the Company used approximately $907.7 million of the proceeds from the Follow-On Offering, Common Shares Offering, the Preferred Offerings, the Senior Notes Offering, the Direct Placement and unsecured note issuances to paydown the Credit Facility. As of December 31, 1997, $363.6 million in mortgage loans were outstanding with maturities ranging from 1998 to 2013. The interest rates on $344.4 million of mortgage loans are fixed and range from 6% to 9.13%. Interest rates on $19.2 million of mortgage loans float with LIBOR or prime, all of which are subject to certain caps. The weighted average interest rate for the mortgage loans is 7.7%, and the weighted average remaining term is 8.3 years. GENERAL The Company expects to incur variable rate debt, including borrowings under the Credit Facility, from time to time. The Company believes that its existing sources of capital, including public debt and equity markets, will provide sufficient funds to finance its continued acquisition and development activities. In this regard, the Company continues to evaluate its long-term capital sources which generally include the availability of debt financing and access to equity. In July 1995, the Company filed a shelf registration with the Securities and Exchange Commission that enabled the Company to offer up to an aggregate of $350.0 million of securities, including common shares of beneficial interest, preferred shares of beneficial interest and debt (the "Initial Shelf Registration"). On November 27, 1995, the Company completed a follow-on public offering of 7,200,000 common shares resulting in proceeds of $140.4 million. On October 15, 1996, the Company filed a Registration Statement with the Securities and Exchange Commission registering for issuance 1,000,000 Common shares to be issued through the Company's Dividend Reinvestment and Share Purchase Plan. 30 On February 21, 1997, the Company filed a shelf registration statement with the Securities and Exchange Commission that enables the Company to offer up to an aggregate of $850.0 million of securities, including common shares of beneficial interest, preferred shares of beneficial interest and debt (the "Second Shelf Registration"). On March 24, 1997, the Company completed a public offering (the "Follow-on Offering") which resulted in the issuance of an additional 7,500,000 Common Shares, and on April 1, 1997, the related overallotment option was exercised, resulting in the issuance of an additional 750,000 Common Shares. The issuance of these Common Shares resulted in aggregate net proceeds to the Company of $191.7 million. On August 11, 1997, the Company completed a public offering (the "Preferred Offering") which resulted in the issuance of 5,000,000 8.8% Series A Cumulative Reedeemable Preferred Shares of Beneficial Interest. The issuance of these Preferred Shares resulted in aggregate net proceeds to the Company of $120.8 million. On August 19, 1997, the Company completed a public offering (the "Senior Notes Offering") which resulted in the issuance of $200.0 million principal amount of unsecured notes. The issuance of these Senior Notes resulted in aggregate net proceeds to the Company of $198.0 million. On October 24, 1997, the Company established a medium-term note program pursuant to which it may issue $200 million principal amount of the Operating Partnership's Medium-Term Notes Due Nine Months or More from Date of Issue. On November 19, 1997, the Company consummated a public offering (the "Common Shares Offering") of 9,200,000 Common Shares. The aggregate net proceeds to the Company from such offering were approximately $222.2 million. On December 9, 1997, the Company sold $100 million principal amount of 6.95% notes due 2006 and, on December 11, 1997, the Company sold $50 million principal amount of 6.97% notes due 2003. The aggregate net proceeds to the Company from such offerings were approximately $149.0 million. On December 11, 1997, the Company consummated a public offering of 796,505 Common Shares for aggregate net proceeds to the Company of $20.0 million (the "Direct Placement"). On December 24, 1997 the Company filed a shelf registration statement with the Securities and Exchange Commission that enables the Company to offer up to an aggregate of $1.5 billion of securities, including common shares of beneficial interest, preferred shares of beneficial interest and debt (the "Third Shelf Registration"). The Third Shelf Registration Statement became effective on January 4, 1998. Collectively, the Initial Shelf Registration, the Second Shelf Registration and the Third Shelf Registration are referred to as the "Shelf Registration Statement". In connection with the acquisition of properties during the year ended December 31, 1997, the Company issued 1,197,739 Units. Subsequent to year end, on January 12, 1998, the Company augmented its medium-term note program to enable the Company to offer, in the aggregate, up to $450 million of the Operating Partnership's medium-term notes. Under the program, on January 22, 1998, the Company sold $75 million principal amount of 6.375% notes due 2013. Such notes are 31 subject to mandatory repayment of principal to the holders thereof in 2003 pursuant to a call/put option relating to such notes. Also under the program, on January 23, 1998, the Company sold $100 million principal amount of 7.50% notes due 2018. The aggregate net proceeds to the Company from such offerings were approximately $173.3 million. On January 21, 1998, the Company consummated a public offering of 2,300,000 Common Shares. The aggregate net proceeds to the Company from such offering were approximately $60.4 million. On February 23, 1998, the Company consummated a public offering of 1,702,128 Common Shares. The aggregate net proceeds to the Company from such offering were approximately $42.7 million. After the completion of the equity and debt offerings described above, the Company has the capacity pursuant to the Shelf Registration Statement to issue up to $891.0 million in equity securities and the Operating Partnership has the capacity to use up to $475.2 million in debt securities (including the $275.0 million of medium-term notes available under the medium-term note program). In December 1997, the Board of Directors of the Company adopted a shareholder rights plan (the "Shareholder Rights Plan"). Under the Shareholder Rights Plan, one Right (as defined in the Shareholder Rights Plan) was attached to each outstanding Common Share at the close of business on December 31, 1997. In addition, a Right will be attached to each share of Common Stock issued in the future. Each Right entitles the registered holder to purchase from the Company, under certain conditions, a unit (a "Rights Plan Unit") consisting of one one- thousandth of a share of a Series A Junior Participating Preferred Share, $0.0001 par value, (the "Junior Preferred Stock"), of the Company, for $100 per Rights Plan Unit, subject to adjustment. The Rights become exercisable only if a person or group of affiliated or associated persons (an "Acquiring Person") acquires, or obtains the right to acquire, beneficial ownership of Common Shares or other voting securities ("Voting Stock") that have 10% or more of the voting power of the outstanding shares of Voting Stock, or if an Acquiring Person commences with or makes an announcement of an intention to make a tender offer or exchange offer to acquire beneficial ownership of Voting Stock that have 10% or more of the voting power of the outstanding shares of Voting Stock. The Rights are redeemable by the Company at a price of $0.0001 per Right. If not exercised or redeemed, all Rights will expire on December 31, 2007. CALCULATION OF FUNDS FROM OPERATIONS Management generally considers Funds from Operations (as defined below) a useful financial performance measure of the operating performance of an equity REIT, because, together with net income and cash flows, Funds from Operations provides investors with an additional basis to evaluate the ability of a REIT to incur and service debt and to fund acquisitions and capital expenditures. Funds from Operations is defined by NAREIT as net income or loss after preferred dividends (computed in accordance with GAAP), excluding gains (or losses) from debt restructuring and sales of property, plus real-estate related depreciation and amortization and minority interest and excluding significant non- recurring events that materially distort the comparative measurement of the Company's performance over time. Funds from Operations does not represent net income or cash flows from operations as defined by GAAP and does not necessarily indicate that cash flows will be sufficient to fund cash needs. It should not be considered as an alternative to net 32 income as an indicator of the Company's operating performance or to cash flows as a measure of liquidity. Funds from Operations also does not represent cash flows generated from operating, investing or financing activities as defined by GAAP. Funds from Operations for the years ended December 31, 1997, 1996 and 1995 are as follows: YEAR ENDED DECEMBER 31, ------------------------------ 1997 1996 1995 -------- -------- -------- (IN THOUSANDS) Income available to common shareholders $ 56,197 $ 33,740 $ 19,466 Addback: Minority interest 5,606 3,891 2,843 Depreciation and amortization 40,315 27,863 22,297 Premium on debenture conversion 98 1,027 - Write off of deferred financing costs 2,919 - - Gain on sale (2,518) (577) - -------- -------- -------- Funds from Operations $102,617 $ 65,944 $ 44,606 ======== ======== ======== INFLATION Inflation has remained relatively low during the last three years, and as a result, has not had a significant impact on the Company during this period. The Credit Facility bears interest at a variable rate; therefore, the amount of interest payable under the Credit Facility will be influenced by changes in short-term interest rates, which tend to be sensitive to inflation. To the extent an increase in inflation would result in increased operating costs, such as in insurance, real estate taxes or utilities, substantially all of the tenant's leases require the tenants to absorb these costs as part of their rental obligations. In addition, inflation also may have the effect of increasing market rental rates. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK - -------------------------------------------------------------------- Not applicable. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA - ----------------------------------------------------- The dual presentation of financial statements for the Company is required by the Securities and Exchange Commission. The Company is comprised of two Securities and Exchange Commission registrants: Liberty Property Trust and Liberty Property Limited Partnership. Accordingly, one set of financial statements are required for each registrant. The financial information contained within the two sets of financial statements is essentially the same, with the exception of reformatting to account for the ownership differences between the entities. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE - ------------------------------------------------------------------------ None. 33 REPORTS OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS AND CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Auditors - Liberty Property Trust - ------------------------------------------------------- Financial Statements - Liberty Property Trust: - ---------------------------------------------- Balance Sheets: Liberty Property Trust Consolidated as of December 31, 1997 and 1996 Statements of Operations: Liberty Property Trust Consolidated for the years ended December 31, 1997, 1996 and 1995 Statements of Shareholders' Equity: Liberty Property Trust Consolidated for the years ended December 31, 1997, 1996 and 1995 Statements of Cash Flows: Liberty Property Trust Consolidated for the years ended December 31, 1997, 1996 and 1995 Notes to Financial Statements - Liberty Property Trust Financial Statement Schedule - Liberty Property Trust: Schedule III - Real Estate and Accumulated Depreciation as of December 31, 1997 Report of Independent Auditors - Liberty Property Limited Partnership - --------------------------------------------------------------------- Financial Statements - Liberty Property Limited Partnership: - ------------------------------------------------------------ Balance Sheets: Liberty Property Limited Partnership Consolidated as of December 31, 1997 and 1996 Statements of Operations: Liberty Property Limited Partnership Consolidated for the years ended December 31, 1997, 1996 and 1995 Statements of Owners' Equity: Liberty Property Limited Partnership Consolidated for the years ended December 31, 1997, 1996 and 1995 Statements of Cash Flows: Liberty Property Limited Partnership Consolidated for the years ended December 31, 1997, 1996 and 1995 Notes to Financial Statements - Liberty Property Limited Partnership Financial Statement Schedule - Liberty Property Limited Partnership: Schedule III - Real Estate and Accumulated Depreciation as of December 31, 1997 34 REPORT OF INDEPENDENT AUDITORS To The Board of Trustees and Shareholders Liberty Property Trust We have audited the accompanying consolidated balance sheets of Liberty Property Trust (the "Trust") as of December 31, 1997 and 1996, and the related consolidated statements of operations, shareholders' equity, and cash flows for each of the three years in the period ended December 31, 1997. Our audits also included the financial statement schedule listed in the Index at Item 14(a). These financial statements and schedule are the responsibility of the Trust's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Liberty Property Trust at December 31, 1997 and 1996, the consolidated results of Liberty Property Trust's operations and cash flows for each of the three years in the period ended December 31, 1997 in conformity with generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein. /s/ ERNST & YOUNG LLP Philadelphia, Pennsylvania ERNST & YOUNG LLP February 13, 1998, except for Note 13, as to which the date is February 23, 1998 35
CONSOLIDATED BALANCE SHEETS OF LIBERTY PROPERTY TRUST (IN THOUSANDS, EXCEPT SHARE AMOUNTS) DECEMBER 31, ------------------------- 1997 1996 ---------- ---------- ASSETS Real estate: Land and land improvements $ 238,519 $ 140,196 Buildings and improvements 1,639,821 908,835 Less accumulated depreciation (149,311) (119,151) ---------- ---------- Operating real estate 1,729,029 929,880 Development in progress 156,093 85,628 Land held for development 61,904 44,054 ---------- ---------- Net real estate 1,947,026 1,059,562 Cash and cash equivalents 55,079 19,612 Accounts receivable 6,517 7,007 Deferred financing and leasing costs, net of accumulated amortization (1997 $40,560; 1996 $30,985) 32,536 27,013 Prepaid expenses and other assets 53,179 39,418 ---------- ---------- Total assets $2,094,337 $1,152,612 ========== ========== LIABILITIES Mortgage loans $ 363,591 $ 240,803 Unsecured notes 350,000 - Lines of credit 135,000 266,692 Convertible debentures 111,543 171,214 Accounts payable 14,544 6,294 Accrued interest 10,960 7,411 Dividend payable 25,927 14,248 Other liabilities 42,499 28,923 ---------- ---------- Total liabilities 1,054,064 735,585 Minority interest 84,678 41,495 SHAREHOLDERS' EQUITY 8.8% Series A cumulative redeemable preferred shares, $.001 par value, 5,000,000 shares authorized, 5,000,000 shares issued and outstanding as of December 31, 1997 120,814 - Common shares of beneficial interest, $.001 par value, 200,000,000 shares authorized, 52,692,940 and 31,400,361 shares issued and outstanding as of December 31, 1997 and 1996, respectively 53 31 Additional paid-in capital 846,949 370,813 Unearned compensation (985) (1,408) (Dividends in excess of net income) retained earnings (11,236) 6,096 ---------- ---------- Total shareholders' equity 955,595 375,532 ---------- ---------- Total liabilities and shareholders' equity $2,094,337 $1,152,612 ========== ========== See accompanying notes.
36
CONSOLIDATED STATEMENTS OF OPERATIONS OF LIBERTY PROPERTY TRUST (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) YEAR ENDED DECEMBER 31, ------------------------------------------ 1997 1996 1995 ------------ ------------ ------------ REVENUE Rental $ 169,859 $ 112,841 $ 89,163 Operating expense reimbursement 55,502 35,886 24,604 Management fees 673 1,340 734 Interest and other 6,483 4,198 2,540 ------------ ----------- ----------- Total revenue 232,517 154,265 117,041 OPERATING EXPENSES Rental property 43,118 29,624 20,010 Real estate taxes 17,961 11,229 9,304 General and administrative 10,650 8,023 5,212 Depreciation and amortization 40,752 28,203 22,518 ------------ ----------- ----------- Total operating expenses 112,481 77,079 57,044 ------------ ----------- ----------- Operating income 120,036 77,186 59,997 Premium on debenture conversions 98 1,027 -- Interest expense 53,888 38,528 37,688 ------------ ----------- ----------- Income before minority interest 66,050 37,631 22,309 Minority interest 5,606 3,891 2,843 ------------ ----------- ----------- Net income 60,444 33,740 19,466 Preferred dividends 4,247 - - ------------ ----------- ----------- Income available to common shareholders $ 56,197 $ 33,740 $ 19,466 ============ =========== =========== Income per common share - basic $ 1.39 $ 1.14 $ 0.89 ============ =========== =========== Income per common share - diluted $ 1.38 $ 1.14 $ 0.89 ============ =========== =========== Weighted average number of common shares outstanding - basic 40,493 29,603 21,833 ============ =========== =========== Weighted average number of common shares outstanding - diluted 40,806 29,678 21,838 ============ =========== ===========
See accompanying notes. 37
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY OF LIBERTY PROPERTY TRUST (IN THOUSANDS) RETAINED EARNINGS/ COMMON (DIVIDENDS SHARES OF ADDITIONAL IN EXCESS TOTAL PREFERRED BENEFICIAL PAID-IN UNEARNED OF NET SHAREHOLDERS' SHARES INTEREST CAPITAL COMPENSATION INCOME) EQUITY ---------- --------- ------------ ------------ ----------- -------------- Shareholders' equity at January 1, 1995 $ 21 $ 182,856 $ 46,790 $ 229,667 Net proceeds from the issuance of common shares 7 131,451 - 131,458 Conversion of debentures - 100 - 100 Net income - - 19,466 19,466 Common dividends - - (45,170) (45,170) --------- ---------- ------------ ------------ Balance at December 31, 1995 28 314,407 21,086 335,521 Conversion of debentures 3 55,802 - 55,805 Unearned compensation - 2,112 $ (1,408) - 704 Net income - - - 33,740 33,740 Common dividends - - - (48,730) (48,730) Noncash compensation - 370 - - 370 Minority interest reclassifcation - (1,878) - - (1,878) --------- ---------- ----------- ----------- ----------- Balance at December 31, 1996 31 370,813 (1,408) 6,096 375,532 Net proceeds from the issuance of common shares 19 434,053 - - 434,072 Net proceeds from the issuance of preferred shares $ 120,814 - - - - 120,814 Conversion of debentures 3 57,263 - - 57,266 Unearned compensation - - - 423 - 423 Net income - - - - 60,444 60,444 Common dividends - - - - (73,529) (73,529) Preferred dividends (4,247) (4,247) Noncash compensation - - 802 - - 802 Minority interest reclass- ification - - (15,982) - - (15,982) ---------- ---------- ---------- ----------- ----------- ----------- Balance at December 31, 1997 $ 120,814 $ 53 $ 846,949 $ (985) $ (11,236) $ 955,595 ========== ========== ========== =========== =========== ===========
See accompanying notes. 38
CONSOLIDATED STATEMENTS OF CASH FLOWS OF LIBERTY PROPERTY TRUST (IN THOUSANDS) YEAR ENDED DECEMBER 31, ---------------------------------------- 1997 1996 1995 ------------ ------------ ------------ OPERATING ACTIVITIES Net income $ 60,444 $ 33,740 $ 19,466 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 40,752 28,203 22,518 Amortization of deferred financing costs 7,367 4,561 4,869 Minority interest in net income 5,606 3,891 2,843 Gain on sale (2,518) (577) - Noncash compensation 423 704 - Changes in operating assets and liabilities: Accounts receivable 490 (1,399) (1,006) Prepaid expenses and other assets (11,881) (12,897) (5,595) Accounts payable 8,250 1,717 2,871 Accrued interest 3,549 (2,028) (286) Other liabilities 14,378 8,463 9,641 ----------- ----------- ----------- Net cash provided by operating activities 126,860 64,378 55,321 ----------- ----------- ----------- INVESTING ACTIVITIES Investment in properties (655,744) (115,971) (193,219) Proceeds from disposition of properties 33,958 - - Investment in development in progress (206,593) (126,392) (64,122) Investment in land held for development (17,850) (15,476) (20,367) Increase in deferred leasing costs (8,642) (7,588) (4,154) ----------- ----------- ----------- Net cash used in investing activities (854,871) (265,427) (281,862) ----------- ----------- ----------- FINANCING ACTIVITIES Net proceeds from issuance of common stock 434,072 - 131,458 Net proceeds from issuance of preferred shares 120,814 - - Proceeds from issuance of unsecured notes 350,000 - - Proceeds from mortgage loans 124,815 77,605 91,800 Repayments of mortgage loans (50,340) (8,917) (7,659) Proceeds from lines of credit 776,017 237,191 167,925 Repayments on lines of credit (907,709) (42,393) (140,031) Deposits on pending acquisitions 45 2,593 12,865 Increase in deferred financing costs (10,941) (3,469) (5,576) Common dividends (64,568) (47,190) (33,830) Preferred dividends (2,414) - - Distribution to partners (6,313) (5,388) (4,951) ----------- ----------- ----------- Net cash provided by financing activities 763,478 210,032 212,001 Increase (decrease) in cash and cash equivalents 35,467 8,983 (14,540) Cash and cash equivalents at beginning of year 19,612 10,629 25,169 ----------- ----------- ----------- Cash and cash equivalents at end of year $ 55,079 $ 19,612 $ 10,629 =========== =========== =========== SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS Write-off of fully depreciated property and deferred costs $ 7,892 $ 487 $ 2,617 Acquisition of properties (77,105) - (55,874) Assumption of mortgage loans 48,313 - 41,117 Issuance of operating partnership units 28,792 - 14,757 Noncash compensation 802 370 - Conversion of convertible debentures 57,266 55,805 100 =========== =========== ===========
See accompanying notes. 39 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF LIBERTY PROPERTY TRUST 1. ORGANIZATION Liberty Property Trust (the "Trust") is a self-administered and self- managed Maryland real estate investment trust (a "REIT"). Substantially all of the Trust's assets are owned directly or indirectly, and substantially all of the Trust's operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the "Operating Partnership" and, together with the Trust, the "Company"). At December 31, 1997, the Trust owned a 91.84% interest in the Operating Partnership as the sole general partner and a 0.02% interest as a limited partner. The Company provides leasing, property management, acquisition, development, construction management, and design management for a portfolio of industrial and office properties which are located principally within the Southeastern, Mid-Atlantic and Mid-Western United States. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Principles of Consolidation The Consolidated Financial Statements of the Company include the accounts of the Trust, the Operating Partnership and the Operating Partnership's direct and indirect subsidiaries including Liberty Property Development Corporation. All significant intercompany transactions and accounts have been eliminated. Certain amounts from prior periods have been restated to conform to current year presentation. Real Estate and Depreciation The Properties are recorded at the lower of cost or fair value and are depreciated using the straight-line method over their estimated useful lives. The estimated useful lives are as follows: Building and improvements 40 years Equipment 10 years Tenant improvements Term of the related lease Expenditures directly related to acquisition, development or improvement of real estate are capitalized as a cost of the property. Expenditures for maintenance and repairs are charged to operations as incurred. Cash and Cash Equivalents Highly liquid investments with a maturity of three months or less when purchased are classified as cash equivalents. The carrying amount of these assets approximates their fair market value. Revenues The Company earns rental income under operating leases with tenants. 40 Rental income is recognized on a straight-line basis over the applicable lease term. Deferred Financing and Leasing Costs Costs incurred in connection with financing or leasing are capitalized and amortized over the term of the related loan or lease. Amortization of deferred financing costs is reported as interest expense. Income per Common Share In the fourth quarter of 1997, the Company adopted Statement of Financial Accounting Standards No. 128, "Earnings per Share", which replaced the calculation of primary and fully diluted income per common share with basic and diluted income per common share. Unlike primary income per common share, basic income per common share excludes any dilutive effects of options. Diluted income per common share includes the weighted average common shares and dilutive effect of the outstanding options for the years ended December 31, 1997, 1996 and 1995, and excludes the effects of the conversion of the Units and Convertible Debentures into common shares, as to do so would have been antidilutive for the periods presented. The securities excluded from the diluted calculation could potentially dilute basic income per common share in the future. All income per common share amounts for all periods have been presented, and where appropriate, restated to conform to the Statement 128 requirement. The following table sets forth the computation of basic and diluted income per common share:
FOR THE YEAR ENDED 1997 FOR THE YEAR ENDED 1996 ------------------------------------- ------------------------------------- INCOME SHARES PER-SHARE INCOME SHARES PER-SHARE (NUMERATOR) (DENOMINATOR) AMOUNT (NUMERATOR) (DENOMINATOR) AMOUNT ----------- ------------- --------- ----------- ------------- --------- Net income $ 60,444 $ 33,740 Less: Preferred dividends 4,247 - ----------- ----------- BASIC income per common share Income available to common shareholders 56,197 40,493 $ 1.39 33,740 29,603 $ 1.14 ========= ========= EFFECT OF DILUTIVE SECURITIES Options - 313 - 75 ----------- ------------- ----------- ------------- DILUTED income per common share Income available to common shareholders and assumed conversions $ 56,197 40,806 $ 1.38 $ 33,740 29,678 $ 1.14 =========== ============= ========= =========== ============= ======== FOR THE YEAR ENDED 1995 ------------------------------------- INCOME SHARES PER-SHARE (NUMERATOR) (DENOMINATOR) AMOUNT ----------- ------------- --------- Net income $ 19,466 Less: Preferred dividends - ----------- BASIC income per common share Income available to common shareholders 19,466 21,833 $ 0.89 ========= EFFECT OF DILUTIVE SECURITIES Options - 5 ----------- ------------ DILUTED income per common share Income available to common shareholders and assumed conversions $ 19,466 21,838 $ 0.89 =========== ============ =========
41 Basic income per common share would be $1.39 calculated as if the debenture conversions which occurred in 1997 had occurred on January 1, 1997. Income Taxes The Trust qualifies and intends to continue to qualify as REIT under the Internal Revenue Code. As a REIT, the Trust generally will not be subject to federal income tax to the extent that it distributes at least 95% of its REIT taxable income to its shareholders. The Trust may be subject to certain state and local taxes on its income and property and to federal income and excise taxes on its undistributed income. The Company paid common dividends of $70.6 million, $52.6 million, and $38.7 million, during the years ended December 31, 1997, 1996 and 1995. On a per share basis, the Company paid common dividends of $1.65, $1.61, and $1.60 during the years ended December 31, 1997, 1996 and 1995. The portions of the 1997 common dividend relating to return of capital, earnings and profits, and capital gain are 30.4%, 68.4%, and 1.2%, respectively. The capital gain distribution for the 1997 common dividend designated as unrecaptured section 1250 gain (25% tax rate) and long-term capital gain (20% tax rate) are 63.4% and 36.6%, respectively. The Company paid preferred dividends of $2.4 million during the year ended December 31, 1997. On a per share basis, the Company paid preferred dividends of $0.48 during the year ended December 31, 1997. The portions of the 1997 preferred dividend relating to return of capital, earnings and profits, and capital gain are 0.0%, 95.3%, and 4.7%, respectively. The portion of the capital gain distribution for the 1997 preferred dividend designated as unrecaptured section 1250 gain (25% tax rate) and long-term capital gain (20% tax rate) are 63.4% and 36.6%, respectively. The Federal tax cost basis of the real estate at December 31, 1997 was approximately $2.0 billion. 3. REAL ESTATE At December 31, 1997 and 1996, the Company owned and operated industrial and office properties located principally in suburban mixed use developments or business parks. The carrying value of these properties by type is as follows (in thousands):
LAND BUILDINGS AND LAND AND ACCUMULATED IMPROVEMENTS IMPROVEMENTS TOTAL DEPRECIATION ------------ ------------ --------- ------------ 1997: Industrial properties $ 140,793 $ 873,937 $1,014,730 $ 81,774 Office properties 97,726 765,884 863,610 67,537 ---------- ----------- ---------- ----------- 1997 Total $ 238,519 $1,639,821 $1,878,340 $ 149,311 ========== =========== ========== =========== 1996: Industrial properties $ 85,459 $ 517,272 $ 602,731 $ 62,557 Office properties 54,737 391,563 446,300 56,594 --------- ----------- ---------- ----------- 1996 Total $ 140,196 $ 908,835 $1,049,031 $ 119,151 ========= =========== ========== ===========
42 Depreciation expense was $36.0 million in 1997, $25.0 million in 1996, and $19.7 million in 1995. As of December 31, 1997, the Company has commenced development on 43 properties, which upon completion are expected to comprise approximately 4.1 million square feet of leaseable space. As of December 31, 1997, approximately $156.1 million has been expended for the development of these projects and an additional $148.8 million is required for completion. 4. RELATED PARTY TRANSACTIONS An affiliated company provides construction services to the Company. Amounts paid to this affiliate were $8.2 million in 1997, $29.7 million in 1996 and $6.2 million in 1995. During 1995, three properties were purchased from partnerships in which officers of the Company had an interest. The officers received no financial consideration for the purchase. Pursuant to agreements, the Company has been retained by an affiliate (Rouse Kent Limited) to provide development, management and other services. For the years ended December 31, 1997, 1996 and 1995 the fees for these services were $600,000 per year. Additionally, the Company committed to loans in 1996 to two affiliates (Rouse Kent Development Limited and 1 Tower View Limited) for development projects. As of December 31, 1997, only one (1 Tower View Limited) of these loans, with a balance of $5.5 million, remained outstanding. As of December 31, 1996, the balance of these loans was $7.4 million. 5. MORTGAGE LOANS, UNSECURED NOTES, LINES OF CREDIT AND CONVERTIBLE DEBENTURES Long term indebtedness consists generally of mortgage loans, unsecured notes, lines of credits, and convertible debentures. The average annualized interest rates for the years ended December 31, 1997, 1996 and 1995, were approximately 7.5%, 7.6% and 7.8%, respectively. Interest expense for the years ended December 31, 1997, 1996 and 1995, aggregated $53.9 million, $38.5 million and $37.7 million, respectively. Interest costs during these periods of $11.8 million, $7.7 million and $3.5 million, were capitalized. Cash paid for interest for the years ended December 31, 1997, 1996 and 1995, was $54.9 million, $43.7 million and $36.7 million, respectively. Mortgage loans with maturities ranging from 1998 to 2013 are collateralized by and in some instances cross-collateralized by properties with a book value of $493.2 million. The interest rates on $344.4 million of mortgage loans are fixed and range from 6% to 9.13%. Interest rates on $19.2 million of mortgage loans float with Eurodollar or prime and are subject to certain caps. The weighted average interest rate on the mortgage loans is 7.7% and the weighted average remaining term is 8.3 years. 43 The aggregate maturities of the mortgage loans outstanding are as follows (in thousands): 1998 $ 13,443 1999 21,718 2000 32,451 2001 22,700 2002 6,044 Thereafter 267,235 -------- TOTAL $363,591 ======== The unsecured notes are comprised of $350 million principal amount of fixed rate unsecured notes with four maturities, which are as follows: $50 million principal amount bears interest at 6.97% and is due 2003, $100 million principal amount bears interest at 7.1% and is due 2004, $100 million principal amount bears interest at 6.95% and is due 2006, and $100 million principal amount bears interest at 7.25% and is due 2007. The line of credit is a $325 million unsecured credit facility (the "Credit Facility") which replaced two existing secured lines of credit aggregating $350 million in May 1997. Coincident with the replacement of the lines of credit, $2.9 million of related deferred financing costs were charged to interest expense. The interest rate on borrowings under the Credit Facility fluctuates, based on the Company's leverage levels and senior debt ratings from Moody's Investors Service, Inc. ("Moody's") and Standard & Poor's Ratings Group ("Standard & Poor's"). The current ratings for the Company's senior unsecured debt are Baa3 and BBB- from Moody's and Standard & Poor's, respectively. At these ratings, the current interest rate on the Credit Facility is 110 basis points over the Eurodollar Rate (7.09% at December 31, 1997). The rate for both Lines of Credit at December 31, 1996 was 7.13%. Customary fees apply to the Credit Facility including an annual administrative fee and an unused line fee. The convertible debentures are due on June 23, 2001 and are exchangeable for common shares of beneficial interest of the Trust (the "Common Shares") at a rate of one Common Share for each $20 outstanding principal amount of convertible debentures, subject to certain adjustments. The initial interest rate on the convertible debentures was 8% and increases with increases in the dividend payment on the Company's Common Shares. At the current $.42 per share per quarter dividend payment rate, the effective interest rate on the convertible debentures is 8.4%. At December 31, 1996, the effective interest rate on the convertible debentures was 8.2%. During the year ended December 31, 1997, the Company paid sums aggregating $98,000 to facilitate the conversion of $17.3 million of convertible debentures into 862,650 Common Shares. During the year ended December 31, 1997, $2.4 million of deferred financing costs relating to converted convertible debentures were charged to additional paid-in capital. During the year ended December 31, 1996, the Company paid sums aggregating $1.0 million to facilitate the conversion of $58.7 million of convertible debentures into 2,934,300 Common Shares. During the year ended December 31, 1996, $2.9 million of related deferred financing costs were charged to additional paid-in capital. At December 31, 1997 and 1996 the convertible debentures were convertible into 5,577,150 Common Shares and 8,560,700 Common Shares, respectively. 44 The fair value of the convertible debentures at December 31, 1997 was $159.3 million based on the closing bid price of the Company's Common Shares on the New York Stock Exchange. The fair values of the mortgages, the unsecured notes and Credit Facility were estimated using discounted cash flow analysis, based on the Company's estimated incremental borrowing rate at December 31, 1997, for similar types of borrowing arrangements. The carrying values of the mortgages, the unsecured notes and the Credit Facility approximate their fair values. 6. LEASING ACTIVITY Future minimum rental payments due from tenants under non-cancellable operating leases as of December 31, 1997 are as follows (in thousands): 1998 $ 211,211 1999 186,375 2000 147,201 2001 109,323 2002 85,078 Thereafter 309,527 ---------- TOTAL $1,048,715 ========== In addition to minimum rental payments, tenants pay for their pro rata share of specified operating expenses. These amounts are included as operating expense reimbursement in the accompanying statements of operations. 7. MINORITY INTEREST In conjunction with the formation of the Company and certain subsequent acquisitions, persons contributing interest in properties to the Operating Partnership have received limited partnership interests in the Operating Partnership. In connection with the acquisition of properties for the year ended 1997, the Company issued 1,197,739 units. There were no units issued in connection with the acquisition of properties in 1996. The aggregate outstanding limited partnership interests have the same economic characteristics as would 4,668,700 Common Shares outstanding as of December 31, 1997, inasmuch as they share proportionately in the net income or loss and in any distributions of the Operating Partnership and such interests are exchangeable into the same number of Common Shares of the Trust. Minority interest in the accompanying consolidated financial statements relates to such limited partnership interests. 8. SHARE OPTIONS The Company has elected to follow Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" (APB 25) and related Interpretations in accounting for its employee stock options because, as discussed below, the alternative fair value accounting provided for under FASB Statement No. 123, "Accounting for Stock-Based Compensation," requires use of option valuation models that were not developed for use in valuing employee stock options. Under APB 25, because the exercise price of the Company's employee stock options equals the market price of the underlying stock on the date of grant, no compensation expense is recognized. 45 The Company's Share Incentive Plan ("Share Incentive Plan") has authorized the grant of options to executive officers, other key employees, non-employee trustees and consultants of up to 2,100,000 shares of the Company's Common Shares. An amendment to increase the number of Common Shares available for awards under the Share Incentive Plan from 2,100,000 to 4,033,535 was approved at the 1997 Annual Shareholders' Meeting. All options granted have 10-year terms and vest over a 3-year period, with options to purchase up to 20% of the shares exercisable after the first anniversary, up to 50% after the second anniversary and 100% after the third anniversary of the date of grant. Pro forma information regarding net income and earnings per share is required by Statement 123, and has been determined as if the Company had accounted for its employee stock options under the fair value method of that Statement. The fair value for these options was estimated at the date of grant using a Black-Scholes option pricing model with the following weighted-average assumptions for 1997, 1996 and 1995, respectively: risk-free interest rate of 5.5%, 6.2% and 6.2%; dividend yield of 6.0%, 7.0% and 7.0%; volatility factor of the expected market price of the Common Shares of .155, .164 and .164; and a weighted-average expected life of the option of 3 years. The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options which have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including the expected stock price volatility. Because the Company's employee share options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its employee share options. For purposes of pro forma disclosures, the estimated fair value of the options determined according to the Black-Scholes Option pricing model is amortized to expense over the options' vesting period. The Company's pro forma information follows (in thousands, except for per share amounts): 1997 1996 1995 --------- --------- -------- Pro forma income available to common shareholders $ 55,538 $ 33,359 $ 19,392 Pro forma income per common share: Basic $ 1.37 $ 1.13 $ 0.89 Diluted $ 1.36 $ 1.12 $ 0.89 Pro forma disclosures are not likely to be representative of the effects on reported net income for future years because of the staggered vesting periods of the options. A summary of the Company's share option activity, and related information for the years ended December 31, 1997, 1996 and 1995 follows: 46
1997 1996 1995 ----------------- ----------------- ------------------ WEIGHTED WEIGHTED WEIGHTED AVERAGE AVERAGE AVERAGE OPTIONS EXERCISE OPTIONS EXERCISE OPTIONS EXERCISE (000s) PRICE (000s) PRICE (000s) PRICE ------- -------- ------- -------- --------- -------- Outstanding-beginning of year 1,470 $ 20.28 1,468 $ 20.26 765 $20.00 Granted 542 $ 25.66 166 20.77 703 20.54 Exercised (49) $ 23.00 (118) 20.77 - - Forfeited - - (46) 20.00 - - ------- ------- ------- ------- ------- ------- Outstanding-end of year 1,963 $ 21.70 1,470 $ 20.28 1,468 $20.26 ======= ======= ======= ======= ======= ======= Exercisable at end of year 1,081 $ 20.18 501 $ 20.15 153 $20.00 Weighted-average fair value of options granted during the year $ 2.05 $ 1.62 $ 1.60
Exercise prices for options outstanding as of December 31, 1997 ranged from $19.75 to $26.95. The weighted-average remaining contractual life of those options is 7.7 years. An additional 1,858,502, 511,887, and 632,400 Common Shares were reserved for issuance for future grants from the Share Incentive Plan at December 31, 1997, 1996 and 1995, respectively. 9. SHAREHOLDER'S RIGHTS PLAN In December 1997, the Board of Directors of the Company adopted a shareholder rights plan (the "Shareholder Rights Plan"). Under the Shareholder Rights Plan, one Right (as defined in the Shareholder Rights Plan) was attached to each outstanding Common Share at the close of business on December 31, 1997. In addition, a Right will be attached to each share of Common Stock issued in the future. Each Right entitles the registered holder to purchase from the Company, under certain conditions, a unit (a "Rights Plan Unit") consisting of one one- thousandth of a share of a Series A Junior Participating Preferred Share, $0.0001 par value, (the "Junior Preferred Stock"), of the Company, for $100 per Rights Plan Unit, subject to adjustment. The Rights become exercisable only if a person or group of affiliated or associated persons (an "Acquiring Person") acquires, or obtains the right to acquire, beneficial ownership of Common Shares or other voting securities ("Voting Stock") that have 10% or more of the voting power of the outstanding shares of Voting Stock, or if an Acquiring Person commences with or makes an announcement of an intention to make a tender offer or exchange offer to acquire beneficial ownership of Voting Stock that have 10% or more of the voting power of the outstanding shares of Voting Stock. The Rights are redeemable by the Company at a price of $0.0001 per Right. If not exercised or redeemed, all Rights will expire on December 31, 2007. 10. COMMITMENTS AND CONTINGENCIES All of the Properties were subject to Phase I Environmental Assessments ("Phase I Assessments") obtained in contemplation of their acquisition by the Company. The Phase I Assessments consisted of, among other activities, a visual inspection of each Property and its neighborhood and a check of pertinent public records. The Phase I 47 Assessments did not reveal, nor is the Company aware of, any non- compliance with environmental laws, environmental liability or other environmental claim that the Company believes would likely have a material adverse effect on the Company. In connection with one of the 1997 acquisitions, the Company is obligated to purchase, over a 10-year period ending in 2007, approximately 800 acres of land for commercial development. The purchase price of the land is $17.5 million, plus accrued interest at 7.5% per annum, payable over 10 years ending in 2007. The Trust is not a party to any material legal proceedings. In the ordinary course of business, the Operating Partnership is party to routine litigation incidental to its business and in addition it is covered by insurance. 11. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) The following is a summary of quarterly results of operations for the two years ended December 31, 1997 and 1996 (in thousands, except per share amounts):
QUARTER ENDED ---------------------------------------------------------------------------------- DEC. 31, SEPT. 30, JUNE 30, MARCH 31, DEC. 31, SEPT. 30, JUNE 30, MARCH 31, 1997 1997 1997 1997 1996 1996 1996 1996 -------- --------- -------- --------- -------- --------- -------- --------- Rental revenue $ 50,636 $ 45,241 $ 39,341 $ 34,641 $ 30,822 $ 28,921 $ 27,146 $ 25,952 ======== ======== ======== ======== ======== ========= ======== ========= Operating income 38,467 31,363 26,100 24,106 20,884 19,657 18,557 18,088 ======== ======== ======== ======== ======== ========= ======== ========= Income before minority interest 24,750 17,571 12,205 11,524 10,630 9,313 8,734 8,954 ======== ======== ======== ======== ======== ========= ======== ========= Income available to common shareholders 20,209 14,484 10,955 10,549 9,572 8,370 7,809 7,989 ======== ======== ======== ======== ======== ========= ======== ========= Income per common share - basic $ 0.44 $ 0.36 $ 0.27 $ 0.32 $ 0.31 $ 0.28 $ 0.27 $ 0.28 ======== ======== ======== ======== ======== ========= ======== ========= Income per common share - diluted $ 0.44 $ 0.35 $ 0.27 $ 0.32 $ 0.31 $ 0.28 $ 0.27 $ 0.28 ======== ======== ======== ======== ======== ========= ======== =========
The 1996 and first three quarters of 1997 income per common share amounts have been restated to comply with Statement of Financial Accounting Standards No. 128, "Earnings per Share". 12. PRO FORMA INFORMATION (UNAUDITED) The following unaudited pro forma information has been prepared assuming the 1997 Common and Preferred Shares Offerings and the acquisitions of 33 properties acquired in 1996, and 170 properties acquired in 1997 had occurred at January 1, 1996. The 1996 acquisitions 48 were acquired for a total investment of $132.9 million and the 1997 acquisitions were acquired for a total investment of $727.9 million. YEAR ENDED DECEMBER 31, ----------------------- 1997 1996 -------- --------- (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) ------------------------ Total revenues $ 287,203 $ 255,424 Income available to common shareholders 72,328 56,545 Income per share - basic (1) $ 1.41 $ 1.18 Income per share - diluted (1) 1.40 1.18 (1) Income in the per share calculations has been computed after a deduction for minority interest. This pro forma information is not necessarily indicative of what the actual results of operations of the Company would have been, assuming the Company had completed the Common Share Offering and the Preferred Shares Offering as of January 1, 1996, nor do they purport to represent the results of operations of the Company for future periods. 13. SUBSEQUENT EVENTS On January 22, 1998, the Company sold $75.0 million principal amount of 6.375% notes due 2013. Such notes are subject to mandatory repayment of principal to the holders thereof in 2003 pursuant to a call/put option relating to such notes. On January 23, 1998, the Company sold $100.0 million principal amount of 7.50% notes due 2018. The aggregate net proceeds to the Company from such offerings were approximately $173.3 million. On January 21, 1998, the Company consummated a public offering of 2,300,000 Common Shares. The aggregate net proceeds to the Company from such offering were approximately $60.4 million. On February 23, 1998, the Company consummated a public offering of 1,702,128 Common Shares. The aggregate net proceeds to the Company from such offering were approximately $42.7 million. 49 LIBERTY PROPERTY TRUST REAL ESTATE AND ACCUMULATED DEPRECIATION AS OF DECEMBER 31, 1997
Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE 10,20 Liberty Boulevard Malvern, PA $ - $ 724,058 $ - $ 4,843,344 420 Lapp Road Malvern, PA * 1,054,418 - 6,327,423 1 Chelsea Parkway Boothwyn, PA - 245,082 - 2,611,090 3 Chelsea Parkway Boothwyn, PA - 288,654 - 2,784,590 747 Dresher Road Horsham, PA - 1,607,238 - 3,946,288 45-67 Great Valley Parkway Malvern, PA * 795,143 - 2,846,228 1180 Church Road Lansdale, PA - 2,357,045 10,041,340 4,777,535 40 Valley Stream Parkway Malvern, PA * 322,918 - 2,185,822 50 Valley Stream Parkway Malvern, PA - 323,971 - 2,375,727 20 Valley Stream Parkway Malvern, PA * 465,539 - 5,044,423 800 Town Center Drive Langhorne, PA - 1,617,150 - 8,776,186 1610 Medical Drive Pottstown, PA - 211,639 - 2,499,092 9, 15 Great Valley Parkway Malvern, PA * 1,837,050 - 14,959,932 257-275 Great Valley Parkway Malvern, PA * 504,611 - 4,361,570 300 Technology Drive Malvern, PA - 368,626 - 1,293,647 277-293 Great Valley Parkway Malvern, PA - 530,729 - 1,889,105 311 Technology Drive Malvern, PA - 397,131 - 2,196,846 325 Technology Drive Malvern, PA * 376,444 - 1,851,241 7 Great Valley Parkway Malvern, PA * 176,435 - 4,229,841 55 Valley Stream Parkway Malvern, PA - 215,005 - 3,096,409 65 Valley Stream Parkway Malvern, PA * 381,544 - 4,685,028 508 Lapp Road Malvern, PA * 331,392 - 1,700,134 10 Valley Stream Parkway Malvern, PA * 509,075 - 2,636,397 333 Phoenixville Pike Malvern, PA 2,145,661 523,530 - 3,087,305 1566 Medical Drive Pottstown, PA - 203,083 - 1,844,311 30 Great Valley Parkway Malvern, PA - 128,126 - 355,565 75 Great Valley Parkway Malvern, PA - 143,074 - 418,889 27-43 Great Valley Parkway Malvern, PA * 448,775 - 2,085,060 77-123 Great Valley Parkway Malvern, PA * 887,664 - 4,423,914 260 Great Valley Parkway Malvern, PA * 203,916 - 849,011 256 Great Valley Parkway Malvern, PA * 161,098 - 1,888,761 205 Great Valley Parkway Malvern, PA * 1,368,259 - 9,506,412 12,14,16 Great Valley Parkway Malvern, PA - 130,689 - 1,163,088 155 Great Valley Parkway Malvern, PA * 625,147 - 2,198,481 333 Technology Drive Malvern, PA * 157,249 - 2,310,848 510 Lapp Road Malvern, PA * 356,950 - 865,210 181 Wheeler Court Langhorne, PA - 260,000 1,940,000 106,994 1100 Wheeler Way Langhorne, PA - 150,000 1,100,000 90,717 60 Morehall Road Malvern, PA - 865,424 9,285,000 4,796,385 905 Airport Road West Chester, PA - 1,715,000 5,185,000 202,101 16 Cabot Boulevard Langhorne, PA * 648,889 5,851,112 75,975 1 Country View Road Malvern, PA - 400,000 3,600,000 393,846 2151 Cabot Boulevard Langhorne, PA * 384,100 3,456,900 263,500 170 South Warner Road King of Prussia, PA - 547,800 3,137,400 2,082,785 190 South Warner Road King of Prussia, PA - 552,200 3,162,600 1,182,365 507 Prudential Road Horsham, PA * 644,900 5,804,100 231,047 100 Witmer Road Horsham, PA 9,710,257 3,102,784 - 9,685,337 3100 Horizon Blvd King of Prussia, PA - 601,956 - 2,007,248 3300 Horizon Blvd King of Prussia, PA - 566,403 - 3,261,664 3500 Horizon Blvd King of Prussia, PA - 1,204,839 - 2,529,997 200 Chester Field Parkway Malvern, PA - 495,893 2,739,093 121,305 767 Electronic Drive Horsham, PA - 1,229,685 - 2,937,858 5 Country View Road Malvern, PA * 785,168 4,678,632 134,612 3200 Horizon Blvd King of Prussia, PA - 928,637 - 4,291,215 3000 Horizon Boulevard King of Prussia, PA - 1,191,449 - 1,865,698 111-195 Witmer Road Horsham, PA - 407,005 3,129,058 95,602 300 Welsh Road Horsham, PA - 180,459 1,441,473 55,946 400 Welsh Road Horsham, PA - 282,493 2,256,508 946,356 8801 Tinicum Boulevard Philadelphia, PA - 2,474,031 - 24,427,073 440 East Swedesford Road King of Prussia, PA - 717,001 4,816,121 1,290,522 460 East Swedesford Road King of Prussia, PA - 705,317 4,737,487 300,975 50 Morehall Road Malvern, PA - 849,576 - 12,444,642 2 Walnut Grove Drive Horsham, PA - 1,281,870 7,767,374 686,718 200 Gibralter Road Horsham, PA - 638,513 5,811,323 73,144 220 Gibralter Road Horsham, PA - 629,944 5,733,228 12,048 240 Gibralter Road Horsham, PA - 629,944 5,733,234 12,092 151 S. Warner Road King of Prussia, PA - 1,218,086 6,937,866 53,025 1 Walnut Grove Drive Horsham, PA - 1,058,901 5,343,606 795,381 3606 Horizon Boulevard King of Prussia, PA - 789,409 - 1,924,523 650 Swedesford Road King of Prussia, PA - 952,911 6,722,830 6,535,572 680 Swedesford Road King of Prussia, PA - 952,361 6,722,830 6,668,953 761 Fifth Avenue King of Prussia, PA - 256,463 2,061,468 39,202 771 Fifth Avenue King of Prussia, PA - 152,456 1,256,908 59,970 1 Great Valley Parkway Malvern, PA - 419,460 3,792,570 87,647 5 Great Valley Parkway Malvern, PA - 684,200 6,181,661 70,612 311 Sinclair Road Bristol, PA - 277,901 1,576,906 2,039 181-187 Gibralter Road Horsham, PA - 440,549 3,979,984 3,126 104 Rock Road Horsham, PA - 330,111 2,981,669 2,334 123-135 Rock Road Horsham, PA - 292,360 2,640,689 2,066 111-159 Gibralter Road Horsham, PA - 489,032 4,417,099 3,458 161-175 Gibralter Road Horsham, PA - 360,673 3,257,722 16,596 125-137 Gibralter Road Horsham, PA - 319,906 2,889,500 2,262 261-283 Gibralter Road Horsham, PA - 494,871 4,469,840 3,499 210-223 Witmer Road Horsham, PA - 270,282 2,441,276 1,912 231-237 Gibralter Road Horsham, PA - 506,952 4,578,963 3,584 100 Gibralter Road Horsham, PA - 38,729 349,811 274 101 Gibralter Road Horsham, PA - 651,990 5,888,989 4,609 506 Prudential Road Horsham, PA - 99,140 895,470 701 50 Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE - Continued 113-123 Rock Road Horsham, PA - 351,072 3,171,001 2,482 101-111 Rock Road Horsham, PA - 350,561 3,166,389 2,478 120 Gibralter Road Horsham, PA - 533,142 4,830,515 33,335 110 Gibralter Road Horsham, PA - 655,041 5,916,549 4,632 100-107 Lakeside Drive Horsham, PA - 239,528 2,163,498 1,694 200-264 Lakeside Drive Horsham, PA - 502,705 4,540,597 157,400 300-309 Lakeside Drive Horsham, PA - 369,475 3,338,761 2,601 400-445 Lakeside Drive Horsham, PA - 543,628 4,910,226 3,844 201 Gibralter Road Horsham, PA - 380,127 3,433,433 74,648 3600 Horizon Drive King of Prussia, PA - 236,432 1,856,252 12,872 3602 Horizon Drive King of Prussia, PA - 217,734 1,759,489 8,446 400-500 Brandywine Parkway West Chester, PA - 845,846 6,809,025 6,229 600 Brandywine Parkway West Chester, PA - 664,899 5,352,410 4,896 14 Lee Boulevard Malvern, PA * 664,282 - 7,166,129 500 Chester Field Parkway Malvern, PA * 472,364 - 2,873,049 300-400 Chester Field Parkway Malvern, PA * 937,212 - 4,487,762 1805 Underwood Boulevard Delran, NJ 1,756,160 188,610 612,736 17,699 150 Mid-Atlantic Parkway West Deptford, NJ - 86,968 304,672 131,758 18 Boulden Circle New Castle, DE - 188,144 - 3,830,254 501 Delran Parkway Delran, NJ - 182,192 - 2,690,712 600 Delran Parkway Delran, NJ - 368,843 - 5,945,538 1607 Imperial Way West Deptford, NJ - 286,413 - 2,751,965 1 Boulden Circle New Castle, DE - 88,397 - 1,342,750 31-55 Read's Way New Castle, DE - 901,391 - 5,588,440 3 Boulden Circle New Castle, DE - 119,802 - 2,112,445 5 Boulden Circle New Castle, DE - 219,641 - 3,514,502 601 Delran Parkway Delran, NJ - 193,794 - 1,635,355 51 Haddonfield Road Cherry Hill, NJ - 251,443 - 9,246,387 57 Read's Way New Castle, DE 2,424,227 253,119 - 2,809,781 1370 Imperial Way West Deptford, NJ - 297,000 4,373,155 39,539 8 Stow Road Marlton, NJ - 172,600 1,704,436 83,930 10 Stow Road Marlton, NJ - 147,000 1,451,536 9,799 12 Stow Road Marlton, NJ - 103,300 1,021,036 152,383 14 Stow Road Marlton, NJ - 93,100 920,336 130,753 1300 Metropolitan Avenue West Deptford, NJ - 220,000 1,980,000 37,266 701A Route 73 South Marlton, NJ - 264,387 3,772,000 786,779 701C Route 73 South Marlton, NJ - 84,949 1,328,000 254,873 1008 Astoria Boulevard Cherry Hill, NJ - 27,120 424,880 376,952 1475 Imperial Way West Deptford, NJ - 54,000 846,000 186,789 3000 Atrium Way Mt. Laurel, NJ * 500,000 4,500,000 2,740,832 750 Cardinal Drive Pureland, NJ - 230,000 2,070,000 503,481 11000, 15000, 17000 Commerce Parkway Mt. Laurel, NJ - 455,100 4,394,900 488,975 12000, 14000 Commerce Parkway Mt. Laurel, NJ - 361,800 3,285,817 138,238 16000, 18000 Commerce Parkway Mt. Laurel, NJ - 289,700 2,512,683 348,273 406 Lippincott Drive Marlton, NJ - 321,455 1,539,871 791,862 234 High Hill Road Bridgeport, NJ * 249,472 1,477,515 335,497 231 Lake Drive New Castle, DE - 623,043 - 3,612,554 100 Arlington Boulevard Bridgeport, NJ - 6,368 - 4,533,465 100 Berkeley Drive Swedesboro, NJ * 395,160 1,915,215 166,600 301 Lippincott Drive Marlton, NJ - 1,069,837 4,780,163 381,473 303 Lippincott Drive Marlton, NJ - 1,069,837 4,780,163 349,965 510-512 Sharptown Road Bridgeport, NJ * 125,410 1,072,683 34,802 901 Route 73 (901 Building) Marlton, NJ - 334,411 2,733,314 87,854 Four Greentree Center Marlton, NJ * 449,400 3,074,850 458,860 512 Sharptown Road Bridgeport, NJ * 180,468 1,543,617 44,243 15 Boulden Circle New Castle, DE - 406,064 - 2,966,112 404 Lippincott Drive Marlton, NJ - 131,896 - 1,650,600 263 Quigley Blvd New Castle, DE - 170,386 1,302,739 109,251 34 Blevins Drive New Castle, DE - 195,932 1,498,061 46,334 104 Gaither Drive Mt Laurel, NJ - 132,075 1,151,988 219,653 2 Lukens Drive New Castle, DE - 169,050 1,290,150 97,389 402 Lippincott Drive Marlton, NJ - 131,896 - 1,687,179 3000 Lincoln Drive Mt. Laurel, NJ - 284,052 2,458,155 39,606 6000 Commerce Parkway Mt. Laurel, NJ - 234,151 2,022,683 56,254 7000 Commerce Parkway Mt. Laurel, NJ - 260,014 2,236,684 47,866 8000 Commerce Parkway Mt. Laurel, NJ - 234,814 1,995,098 32,420 9000 Commerce Parkway Mt. Laurel, NJ - 286,587 2,474,820 37,361 1000 Briggs Road Mt. Laurel, NJ - 288,577 2,546,537 205,299 1025 Briggs Road Mt. Laurel, NJ 2,182,957 430,990 3,714,828 5,109 2000 Crawford Place Mt. Laurel, NJ - 310,831 2,797,744 138,506 1351 Metropolitan Avenue Thorofare, NJ - 189,465 1,728,789 9,272 650 Grove Road Thorofare, NJ - 267,214 2,438,323 5,135 400 Grove Road Thorofare, NJ - 145,009 1,323,085 5,347 1655 Valley Center Parkway Bethlehem, PA 1,821,799 214,431 - 1,867,129 6560 Stonegate Drive Allentown, PA - 458,281 - 2,310,959 6370 Hedgewood Drive Allentown, PA 2,482,280 540,795 - 2,992,692 6390 Hedgewood Drive Allentown, PA 1,784,480 707,203 - 2,496,381 1495 Valley Center Parkway Bethlehem, PA 4,166,495 434,640 - 3,586,015 6350 Hedgewood Drive Allentown, PA 2,619,840 360,027 - 3,104,231 6330 Hedgewood Drive Allentown, PA - 531,268 - 4,203,583 1550 Valley Center Parkway Bethlehem, PA - 196,954 - 3,152,216 1560 Valley Center Parkway Bethlehem, PA - 240,069 - 3,778,113 6580 Snowdrift Road Allentown, PA - 388,328 - 2,436,637 1510 Valley Center Parkway Bethlehem, PA 3,379,289 312,209 - 3,232,782 1530 Valley Center Parkway Bethlehem, PA - 211,747 - 2,567,189 6540 Stonegate Drive Allentown, PA - 422,042 - 3,559,873 974 Marcon Boulevard Allentown, PA - 143,500 - 2,107,239 964 Marcon Street Allentown, PA 1,077,570 138,816 - 1,549,509 764 Roble Road Allentown, PA 771,660 141,069 - 794,167 3174 Airport Road Allentown, PA - 98,986 - 1,088,569 2196 Avenue C Allentown, PA - 101,159 - 1,201,733 2202 Hanger Place Allentown, PA - 137,439 - 1,288,063 2201 Hanger Place Allentown, PA - 128,454 - 1,403,049 51 Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE - Continued 954 Marcon Boulevard Allentown, PA - 103,665 - 916,156 57 South Commerce Way Allentown, PA - 390,839 2,701,161 162,948 754 Roble Road Allentown, PA - 162,115 1,731,885 61,766 894 Marcon Boulevard Allentown, PA - 117,134 1,048,866 23,434 744 Roble Road Allentown, PA - 159,771 1,734,229 123,584 944 Marcon Boulevard Allentown, PA - 118,521 1,435,479 141,175 1685 Valley Center Parkway Allentown, PA - 244,029 - 2,051,109 6520 Stonegate Drive Allentown, PA - 453,315 - 1,825,179 7437 Industrial Boulevard Allentown, PA - 717,488 5,022,413 1,330,656 2041 Avenue C Allentown, PA * 213,599 1,095,217 69,038 2124 Avenue C Allentown, PA * 289,197 1,039,835 54,349 7339 Industrial Boulevard Allentown, PA - 1,187,776 - 5,647,219 7384 Penn Drive Allentown, PA * 651,696 2,286,518 410,371 7144 Daniels Drive Allentown, PA - 2,390,217 2,342,761 3,418,554 7620 Cetronia Road Allentown, PA - 1,091,806 3,851,456 121,030 939 Marcon Blvd Allentown, PA * 2,220,414 4,524,393 734,002 100 Brodhead Road Allentown, PA * 429,416 2,919,588 160,678 1455 Valley Center Parkway Bethlehem, PA - 670,290 - 3,655,277 1640 Valley Center Parkway Bethlehem, PA - 359,000 - 2,414,216 1650 Valley Center Parkway Allentown, PA - 359,000 - 2,225,973 400 Nestle Way Allentown, PA 27,714,138 8,065,500 - 26,412,434 83 South Commerce Way Bethlehem, PA - 143,661 888,128 176,581 85 South Commerce Way Bethlehem, PA - 236,708 987,949 78,786 87 South Commerce Way Bethlehem, PA - 253,886 1,062,881 75,930 7339 Industrial Blvd Allentown, PA - 2,670,849 13,307,408 544,893 95 Highland Avenue Bethlehem, PA - 430,593 3,182,080 278,592 236 Brodhead Road Bethlehem, PA - 376,962 4,672,683 - 6620 Grant Way Allentown, PA - 430,824 1,915,923 4,241 7562 Penn Drive Allentown, PA - 269,614 844,069 4,080 7277 Williams Avenue Allentown, PA - 462,964 1,449,009 7,071 12000,001,040 Indian Creek Court Beltsville, MD 6,470,200 2,659,431 - 10,070,466 8280 Patuxent Range Drive Columbia, MD - 181,601 - 1,294,623 7178-80 Columbia Gateway Columbia, MD - 1,569,237 4,786,887 352,345 8730 Bollman Place Columbia, MD * 624,131 4,576,964 77,839 9770 Patuxent Woods Drive Columbia, MD - 341,663 3,033,309 4,208 9780 Patuxent Woods Drive Columbia, MD - 218,542 1,940,636 2,692 9790 Patuxent Woods Drive Columbia, MD - 243,791 2,164,094 3,038 9810 Patuxent Woods Drive Columbia, MD - 266,684 2,366,901 3,284 9800 Patuxent Woods Drive Columbia, MD - 299,099 2,654,069 3,684 9820 Patuxent Woods Drive Columbia, MD - 237,779 2,110,835 2,928 9830 Patuxent Woods Drive Columbia, MD - 296,262 2,628,933 3,691 9050 Red Branch Road Columbia, MD - 290,950 2,577,153 1,100 180,190 Cochrane Drive Annapolis, MD - 3,670,256 - 16,129,298 9101,9111,9115 Guilford Road Columbia, MD - 758,951 - 3,041,464 9125,9135,9145 Guilford Road Columbia, MD - 900,154 - 5,587,113 10 South Third Street Richmond, VA - 27,970 127,419 45,962 1751 Bluehills Drive Roanoke, VA - 1,063,728 8,500,677 101,951 4300 Carolina Avenue Richmond, VA - 2,007,717 14,927,608 411,598 301 Hill Carter Parkway Richmond, VA * 659,456 4,836,010 63,204 4001 Carolina Avenue Richmond, VA - 29,443 215,914 15,434 5600-5626 Eastport Boulevard Richmond, VA * 489,941 3,592,900 119,912 5650-5674 Eastport Boulevard Richmond, VA * 644,384 4,025,480 132,750 5700 Eastport Boulevard Richmond, VA * 408,729 2,697,348 43,619 11020 Hull Street Road Richmond, VA - 139,887 637,261 8,938 3432 Holland Road Virginia Beach, VA - 173,527 790,515 11,088 3001 Hungary Springs Road Richmond, VA * 136,270 620,785 (15,716) 7760 Shrader Road Richmond, VA * 187,971 756,313 17,191 7740 Shrader Road Richmond, VA * 81,200 369,911 38,061 4880 Cox Road Richmond, VA * 743,898 4,499,807 1,165,166 5162 Valleypointe Parkway Roanoke, VA * 551,483 2,612,312 35,237 4101-4127 Carolina Avenue Richmond, VA 1,331,660 310,854 2,279,597 45,665 4201-4261 Carolina Avenue Richmond, VA 3,043,796 693,203 5,083,493 117,171 4263-4299 Carolina Avenue Richmond, VA 1,902,372 256,203 2,549,649 156,368 4301-4335 Carolina Avenue Richmond, VA - 223,696 1,640,435 116,228 4337-4379 Carolina Avenue Richmond, VA 2,092,610 325,303 2,385,557 322,596 4501-4549 Carolina Avenue Richmond, VA 2,700,419 486,166 3,565,211 101,092 4551-4593 Carolina Avenue Richmond, VA 2,732,824 474,360 3,478,646 85,614 4601-4643 Carolina Avenue Richmond, VA 2,732,824 652,455 4,784,675 268,153 4545-4583 Carolina Avenue Richmond, VA 2,160,335 404,616 2,967,187 797,266 4447-4491 Carolina Avenue Richmond, VA 2,857,044 454,056 2,729,742 63,116 4401-4445 Carolina Avenue Richmond, VA * 615,038 4,510,272 75,786 12 S. Third Street Richmond, VA - 40,539 184,682 6,125 9601 Cosner Drive Fredericksburg, VA * 475,262 3,917,234 148,902 315 Cardiff Valley Road Knoxville, TN - 443,305 2,950,903 42,487 2300 East Parham Road Richmond, VA - 221,947 1,011,088 14,181 1347 Diamond Springs Road Virginia Beach, VA * 436,898 3,203,919 81,419 5221 Valleypark Drive - Bldg A Roanoke, VA 1,287,441 285,008 998,370 224,335 5228 Valleypointe Parkway - Bldg B Roanoke, VA 1,106,806 218,663 796,133 97,252 5238 Valleypark Drive - Bldg C Roanoke, VA 1,290,618 416,375 1,896,832 91,730 5601-5659 Eastport Boulevard Richmond, VA * 705,660 - 4,714,753 5900 Eastport Boulevard Richmond, VA * 676,661 - 4,416,258 4717-4729 Eubank Road Richmond, VA * 449,447 3,294,697 88,475 5251 Concourse Drive Roanoke, VA - 2,813 - 1,752,260 4263F-N. Carolina Ave Richmond, VA * 91,476 - 1,622,707 4200 Oakleys Court Richmond, VA * 459,090 2,468,454 31,223 1821 Battery Dantzler Road Chester, VA - 394,212 3,035,113 18,333 5000 Cox Road Glen Allen, VA * 770,214 3,685,248 28,744 510 Eastpark Court Sandston, VA * 261,961 2,110,874 37,152 520 Eastpark Court Sandston, VA * 486,118 4,083,582 47,804 600 Liberty Way Chesterfield, VA - 146,126 - 5,240,282 500 Liberty Way Chester, VA - 142,692 - 4,501,321 4198 Cox Road Glen Allen, VA - 670,292 3,839,245 - 4510 Cox Road Glen Allen, VA - 1,010,024 7,469,828 18,452 52 Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE - Continued 2809 South Lynnhaven Road Virginia Beach, VA - 953,590 6,142,742 7,515 200 Golden Oak Court Virginia Beach, VA - 1,116,693 6,770,480 8,802 208 Golden Oak Court Virginia Beach, VA - 965,177 6,728,717 7,606 1 Enterprise Parkway Hampton, VA - 974,675 5,579,869 7,684 22 Enterprise Parkway Hampton, VA - 1,097,368 6,760,778 8,642 4523 Green Point Drive High Point, NC 900,000 234,564 - 1,922,997 4501 Green Point Drive High Point, NC 1,153,943 319,289 - 2,213,201 4500 Green Point Drive High Point, NC 946,057 230,622 - 1,994,630 2427 Penny Road High Point, NC 6,607,645 1,165,664 - 6,187,028 4524 Green Point Drive High Point, NC * 182,810 - 2,104,406 4328, 4336 Federal Drive High Point, NC 6,244,530 521,122 - 7,644,052 200 Centreport Drive Greensboro, NC * 331,400 3,768,600 244,158 4344 Federal Drive High Point, NC * 484,001 - 2,324,176 202 Centreport Drive Greensboro, NC * 549,948 5,360,462 149,059 4000 Piedmont Parkway High Point, NC * 592,885 4,825,615 136,857 4380 Federal Drive High Point, NC - 282,996 - 2,034,262 4388 Federal Drive High Point, NC - 143,661 - 1,119,110 6532 Judge Adams Road Rock Creek, NC - 354,903 - 3,504,761 3860 Faber Place N. Charleston, SC * 796,655 1,974,359 - 4055 Faber Place N. Charleston, SC * 882,352 4,794,144 - 3820 Faber Place N. Charleston, SC * 506,558 2,365,146 - 440 Knox Abbott Drive Cayce, SC * 576,767 3,395,168 53,184 Alcoa Fujikura Facility Duncan, SC * 711,353 8,056,324 - 1320 Garlington Road Greenville, SC * 398,539 1,761,533 - 9800 Twin Lakes Parkway Charlotte, NC * 420,079 2,152,047 - 420 Park Avenue Greenville, SC * 522,548 2,730,261 275,887 111 Southchase Blvd. Fountain Inn, SC * 499,065 4,570,357 291,542 300 International Blvd. Fountain Inn, SC - 180,560 639,305 - 1208 Eastchester Drive High Point, NC - 487,209 4,200,817 164,329 One Independence Pointe Greenville, SC - 780,881 6,199,230 15,957 55 Beattie Place Greenville, SC - 2,643,105 23,439,801 19,477 75 Beattie Place Greenville, SC - 2,406,646 17,400,939 17,766 1730 Stebbins Drive Houston, TX - 143,258 - 413,414 5911-5925 Richard Street Jacksonville, FL - 275,582 - 508,059 8383-8385 Baycenter Road Jacksonville, FL - 63,703 - 527,320 8775 Baypine Road Jacksonville, FL - 906,804 - 2,892,795 8539 Western Way Jacksonville, FL - 328,133 - 3,127,137 6255 Lake Gray Boulevard Jacksonville, FL - 813,067 - 3,293,421 6600-6660 Suemac Place Jacksonville, FL - 210,804 - 1,891,471 6800-6850 Suemac Place Jacksonville, FL - 121,077 - 978,170 8665,8667,8669 Baypine Road Jacksonville, FL - 966,552 - 3,911,474 8540 Baycenter Road Jacksonville, FL - 445,603 - 1,371,536 1200 Gulf Life Drive Jacksonville, FL - 1,028,864 - 16,765,527 8400 Baymeadows Way Jacksonville, FL - 557,682 - 2,331,874 8614 Baymeadows Way Jacksonville, FL - 290,291 - 1,110,880 5941-5975 Richard Street Jacksonville, FL - 583,622 - 1,113,225 7970 Bayberry Road Jacksonville, FL - 127,520 - 1,199,583 6000-6030 Bowdendale Avenue Jacksonville, FL - 275,475 - 1,513,480 7898 Baymeadows Way Jacksonville, FL - 561,802 - 1,972,330 5977-6607 Richard Street Jacksonville, FL - 180,033 - 1,565,681 7910 & 7948 Baymeadows Way Jacksonville, FL - 210,299 - 2,678,714 7954 & 7960 Baymeadows Way Jacksonville, FL - 291,312 - 2,980,181 8787 Baypine Road Jacksonville, FL - 2,076,306 - 34,505,962 7077 Bonneval Road Jacksonville, FL - 768,000 5,789,000 783,696 4190 Belfort Road Jacksonville, FL - 821,000 5,866,000 1,007,607 8011, 8021, 8031 Phillips Highway Jacksonville, FL - 626,250 3,548,750 411,643 7020 AC Skinner Parkway Jacksonville, FL * 398,257 - 2,501,809 11777 Central Highway Jacksonville, FL - 92,207 429,997 1,488,577 7016 AC Skinner Parkway Jacksonville, FL - 597,181 - 2,326,445 7018 AC Skinner Parkway Jacksonville, FL - 840,996 - 4,005,625 6620 Southpoint Drive Jacksonville, FL - 614,602 4,267,477 175,376 7980 Bayberry Road Jacksonville, FL - 330,726 1,338,101 3,120 9600 Satellite Boulevard Orlando, FL - 252,850 1,297,923 7,618 9700 Satellite Boulevard Orlando, FL - 405,362 1,146,546 7,617 1902 Cypress Lake Drive Orlando, FL - 523,512 3,191,790 210,148 8250 & 8256 Exchange Place Orlando, FL - 622,413 2,507,842 26,571 6600 Southpoint Parkway Jacksonville, FL - 998,432 4,055,727 12,948 6700 Southpoint Parkway Jacksonville, FL - 620,719 3,178,610 8,737 4801 Executive Park Court - 100 Jacksonville, FL * 554,542 4,568,633 4,066 4801 Executive Park Court - 200 Jacksonville, FL * 370,039 1,947,751 2,717 4810 Executive Park Court Jacksonville, FL * 370,039 1,947,751 2,717 6602 Executive Park Court - 100 Jacksonville, FL * 388,541 2,045,139 2,852 6602 Executive Park Court - 200 Jacksonville, FL * 296,032 1,558,201 2,173 6631 Executive Park Court - 100 Jacksonville, FL * 251,627 1,324,470 1,848 6631 Executive Park Court - 200 Jacksonville, FL * 407,043 2,142,526 2,988 4815 Executive Park Court - 100 Jacksonville, FL * 366,339 1,928,274 2,689 4815 Executive Park Court - 200 Jacksonville, FL * 462,549 2,434,689 3,395 4825 Executive Park Court Jacksonville, FL * 601,314 3,165,095 4,414 4820 Executive Park Court Jacksonville, FL * 555,213 2,621,474 4,076 10511 & 10611 Satellite Boulevard Orlando, FL - 517,554 2,568,186 3,756 1400-1440 Central Florida Parkway Orlando, FL - 518,043 2,561,938 4,558 4001,4051,4101 Fowler Avenue Tampa, FL - 1,299,310 - 4,654,970 5501-5502 Pioneer Park Boulevard Tampa, FL - 162,000 1,613,000 217,844 5690-5694 Crenshaw Street Tampa, FL - 181,923 1,812,496 30,484 3102,3104,3110 Cherry Palm Drive Tampa, FL - 503,767 2,787,585 43,826 7040 AC Skinner Parkway Jacksonville, FL * 706,934 - 3,110,792 8401-8408 Benjamin Road Tampa, FL - 789,651 4,454,648 236,881 3501 Riga Blvd Tampa, FL - 617,289 3,048,379 1,376 111 Kelsey Land Tampa, FL - 359,540 1,461,850 47,875 7930, 8010-20 Woodland Center Tampa, FL * 1,408,478 5,247,246 - 7920 Woodland Center Boulevard Tampa, FL * 1,382,648 2,445,444 393,418 8154-8198 Woodland Center Tampa, FL * 399,088 2,868,834 - 8112-42 Woodland Center Tampa, FL * 513,263 3,230,239 - 53 Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE - Continued 8212 Woodland Center Tampa, FL * 820,882 2,322,720 256,755 1701 Clint Moore Blvd Boca Raton, FL - 1,430,884 3,043,553 12,533 4555 Riverside Drive Beach Gardens, FL - 805,672 5,782,360 6,406 2500 Metrocentre Boulevard West Palm Beach, FL - 238,362 1,534,926 1,795 2540 Metrocenter Boulevard West Palm Beach, FL - 165,071 1,058,736 1,234 2541 Metrocentre Boulevard West Palm Beach, FL - 145,091 379,318 556,776 2580 Metrocentre Boulevard West Palm Beach, FL - 256,478 1,651,602 1,931 2581 Metrocentre Boulevard West Palm Beach, FL - 189,359 1,218,712 1,856 5410 - 5430 Northwest 33rd Avenue Ft. Lauderdale, FL - 603,776 4,176,238 4,481 2905 Northwest Boulevard Plymouth, MN - 516,920 4,646,342 111,638 2800 Campus Drive Plymouth, MN - 395,366 3,554,512 138,202 2955 Xenium Lane Plymouth, MN - 151,238 1,370,140 9,512 9401-9443 Science Center Drive New Hope, MN - 431,295 3,888,684 37,523 6321-6325 Bury Drive Eden Prairie, MN - 462,876 4,151,790 14,788 7115-7173 Shady Oak Road Eden Prairie, MN - 454,974 4,089,410 49,331 7660-7716 Golden Triangle Drive Eden Prairie, MN - 568,706 5,115,177 (9,612) 7400 Flying Cloud Drive Eden Prairie, MN - 195,982 1,762,027 - 330 Second Avenue Minneapolis, MN - 1,481,560 13,043,160 1,251,901 10301-10305 West 70th Street Eden Prairie, MN * 120,622 1,085,226 71,564 10321 West 70th Street Eden Prairie, MN * 145,198 1,305,700 31,390 10333 West 70th Street Eden Prairie, MN * 110,746 995,868 26,999 10349-10357 West 70th Street Eden Prairie, MN * 275,903 2,481,666 255,326 10365-10375 West 70th Street Eden Prairie, MN * 291,077 2,618,194 14,270 10393-10394 West 70th Street Eden Prairie, MN * 269,618 2,423,318 224,195 7078 Shady Oak Road Eden Prairie, MN * 343,093 3,085,795 3,138 5600 & 5610 Rowland Road Minnetonka, MN - 828,650 7,399,409 53,032 2920 Northwest Boulevard Plymouth, MN - 392,026 3,433,678 26,267 26911-26957 Northwestern Southfield, MI - 7,799,515 66,268,817 3,616,706 1650 Research Drive Troy, MI - 763,067 7,201,677 39,172 1775 Research Drive Troy, MI - 331,422 2,788,073 37,674 1875 Research Drive Troy, MI - 329,863 2,774,006 37,675 1850 Research Drive Troy, MI - 781,054 7,364,300 40,071 1965 Research Drive Troy, MI - 419,090 3,578,928 37,675 1960 Research Drive Troy, MI - 419,146 3,579,166 37,675 27260 Haggerty Road Farmington Hills, MI - 456,877 4,091,196 13,745 27200 Haggerty Road Farmington Hills, MI - 382,754 3,425,227 9,091 27280 Haggerty Road Farmington Hills, MI - 452,860 4,055,512 12,180 27220 Haggerty Road Farmington Hills, MI - 203,064 1,802,592 10,807 27240 Haggerty Road Farmington Hills, MI - 171,518 1,518,192 10,690 27300 Haggerty Road Farmington Hills, MI - 370,378 3,311,366 23,633 1101 Allen Drive Troy, MI - 98,144 887,935 5,433 1151 Allen Drive Troy, MI - 164,483 1,486,220 7,171 1300 Rankin Street Troy, MI - 134,090 1,212,752 87 1350 Rankin Street Troy, MI - 111,776 1,011,497 73 1376-1400 Rankin Street Troy, MI - 134,292 1,213,626 17,220 1352-1374 Rankin Street Troy, MI - 153,275 1,385,098 1,181 1324-1346 Rankin Street Troy, MI - 134,090 1,212,214 1,029 1301-1307 Rankin Street Troy, MI - 111,776 1,011,121 853 1409 Allen Drive Troy, MI - 142,370 1,286,048 15,373 1304 E Maple Road Troy, MI - 211,233 1,906,786 1,642 1334 Maplelawn Road Troy, MI - 124,296 1,122,802 960 1290 Maplelawn Road Troy, MI - 85,321 771,621 653 1070 Maplelawn Road Troy, MI - 68,560 620,595 520 950 Maplelawn Road Troy, MI - 252,429 2,265,259 12,838 894 Maplelawn Road Troy, MI - 181,749 1,632,243 9,234 1179 Maplelawn Road Troy, MI - 87,845 794,365 673 1940 Norwood Drive Troy, MI - 86,836 785,267 666 1311-1331 Maplelawn Road Troy, MI - 125,407 1,132,810 969 2354 Bellingham Street Troy, MI - 87,340 789,817 670 2360 Bellingham Street Troy, MI - 87,340 789,817 670 1911 Ring Drive Troy, MI - 86,129 778,900 659 26442-26450 Haggerty Road Farmington Hills, MI - 237,687 2,143,478 7,724 26500 Haggerty Road Farmington Hills, MI - 311,093 2,791,804 26,776 26650 Haggerty Road Farmington Hills, MI - 173,166 1,562,704 7,211 26700 Haggerty Road Farmington Hills, MI - 253,338 2,290,696 1,941 26750 Haggerty Road Farmington Hills, MI - 292,717 2,638,688 8,164 26800 Haggerty Road Farmington Hills, MI - 175,489 1,583,362 7,230 26842-26850 Haggerty Road Farmington Hills, MI - 239,606 2,160,470 7,741 50 Gibson Drive West Malling, UK - - - 3,746,462 25 Kings Hill Avenue West Malling, UK 5,777,800 1,105,380 - 5,651,440 2 Kings Hill Avenue West Malling, UK - 785,565 - 4,829,117 50 Kings Hill Avenue West Malling, UK - 1,215,608 - 13,535,076 ------------- ------------ -------------- ------------ Subtotal Operating Real Estate $ 117,375,737 $233,673,546 $1,005,120,296 $639,545,602 ============= ============ ============== ============ DEVELOPMENT PROPERTIES 132 Welsh Road Horsham, PA $ - $ 1,333,642 $ - $ 3,106,078 3604 Horizon Blvd King of Prussia, PA - 397,178 - 1,835,360 100 Cedar Hollow Road Malvern, PA - 1,436,814 - 5,281,365 3 Country View Road Malvern, PA - 814,278 - 2,497,206 425 Technology Drive Malvern, PA - 191,114 - 1,231,595 375 Technology Drive Malvern, PA - 191,114 - 249,282 100 Chesterfield Pkwy Malvern, PA - 1,320,625 - 889,771 201 Berkeley Drive Bridgeport, NJ - 270,880 - 1,083,711 300 Commodore Drive Bridgeport, NJ - 417,695 - 1,786,429 1660 Valley Center Parkway Bethlehem, PA - 359,000 - 1,648,848 89 South Commerce Way Bethlehem, PA - 320,000 - 1,401,533 1525 Valley Ctr Pkwy Allentown, PA - 475,686 - 3,930,288 700 Nestle Way Allentown, PA - 3,473,120 - 16,029,435 5500 Cox Road Richmond, VA - 443,485 - 1,456,889 13001 Kingston Ave Richmond, VA - 376,584 - 1,723,267 5701-5799 Eastport Blvd Richmond, VA - 694,644 - 4,724,601 54 Cost Capitalized Initial Cost Subsequent --------------------------- to Project City Encumbrances Land Building Acquisition - ------------------------------------ ------------------ ------------- ------------ -------------- ------------- 4801 Cox Road Richmond, VA - 1,072,896 - 3,212,269 701 Liberty Way Richmond, VA - 171,711 - 3,602,218 5310 Valley Park Drive Roanoke, VA - 149,933 - 528,613 5305 Valley Park Drive Roanoke, VA - 266,948 - 603,603 530 Eastpark Court Sandston, VA - 266,883 - 1,122,780 101 Centreport Greensboro, NC - 826,237 - 5,225,165 6532 Judge Adams Road Whitsett, NC - 305,821 - 3,164,486 3875 Faber Place N. Charleston, SC * 1,164,530 - 5,393,510 1 Alliance Drive Goose Creek, SC * 662,422 - 1,468,894 1150 Northpoint Blvd Blythwood, SC * 741,692 - 1,348,001 4160 Mendenhall Oaks Pkwy High Point, NC - 285,882 - 2,622,759 4194 Mendenhall Oaks Pkwy High Point, NC - 102,372 - 1,378,708 4196 Mendenhall Oaks Pkwy High Point, NC - 66,731 - 1,213,758 4170 Mendenhall Oaks Pkwy High Point, NC - 143,699 - 1,425,681 4180 Mendenhall Oaks Pkwy High Point, NC - 121,329 - 1,191,030 7720 Mendenhall Oaks Pkwy High Point, NC - 801,902 - 9,213,047 4345 Southpoint Parkway Jacksonville, FL - - - 7,744,796 131 Silo Bend Tampa, FL - 511,463 - 1,787,484 7724 Woodland Ctr Blvd Tampa, FL - 235,893 - 503,831 7802-50 Woodland Ctr Blvd Tampa, FL - 357,364 - 676,414 7852-98 Woodland Ctr Blvd Tampa, FL - 357,364 - 725,779 8921 Brittany Way Tampa, FL - 255,583 - 122,115 6601-6625 W. 78th Street Bloomington, MN - 2,263,060 - 13,330,686 10400 Southwest Crossing Eden Prairie, MN - 2,912,391 - 1,805,356 10 Kings Hill Ave West Malling, UK - 983,547 - 3,008,337 30 Tower View West Malling, UK - 1,657,321 - 2,546,004 35 Kings Hill Ave West Malling, UK - 812,193 - 2,239,449 ------------- ------------ -------------- ------------ Subtotal Development in Progress $ - $ 30,013,025 $ - $126,080,430 ============= ============ ============== ============ LAND HELD FOR DEVELOPMENT Chelsea Business Park Land Boothwyn, PA $ - $ 1,236,146 $ - $ 660,742 Gwynedd North Bus Camp Land Lansdale, PA - - - 257,945 Three Country View Road Malvern, PA - 912,890 - (906,713) 550 Lapp Road Malvern, PA - 380,891 - (378,317) Cedar Hollow Road Land Malvern, PA - 1,429,473 - (1,429,473) Walnut Grove Land Horsham, PA - 3,435,695 - 503,160 Iron Run Land Upper Macungie, PA - 753,056 - 35,225 35 Liberty Blvd Land Malvern, PA - - - - 45 Liberty Blvd Land Malvern, PA - 4,380,221 - 199,096 Great Valley Land Malvern, PA - 4,674,633 - 231,107 10 Matthews Rd South Land Malvern, PA - 578,804 - 30,191 104 Witmer Road Horsham, PA - 1,248,148 - - 3 Franklin Plaza Philadelphia, PA - 2,483,144 - 20,204 2700 Horizon Dr King of Prussia, PA - 764,370 - 3,579 2900 Horizon Dr King of Prussia, PA - 679,440 - 3,181 2500 Renaissance Blvd King of Prussia, PA - 509,580 - 2,387 2300 Renaissance Blvd King of Prussia, PA - 509,580 - 2,387 Swedes Run Business Park Land Delran, NJ - 1,057,204 - 558,201 Marlton Crossing Land Marlton, NJ - 69,402 - 181,093 Commodore Business Park Logan Twp., NJ - 2,903,914 - 1,479,771 Boulden Land New Castle, DE - - - - Marlton Executive Park Land Marlton, NJ - 550,664 - 215,198 17 Boulden Circle New Castle, DE - 374,982 - 312,489 1015 Briggs Road Land Mt. Laurel, NJ - 356,987 - 16,386 1020 Briggs Road Land Mt. Laurel, NJ - 494,334 - 38,925 Lehigh Valley Corporate Center Land Bethlehem, PA - 2,254,312 - (944,324) Rivers' Bend Land Chesterfield Cty, VA - 1,172,108 - 7,287,973 Oakleys Center Land Richmond, VA - 228,757 - 57,385 Woodlands Center Land Sandston, VA - 1,108,117 - 168,054 501 Liberty Way Chesterfield City, VA - 441,188 - 156,807 601 Hewlett Packard Way Chesterfield City, VA - 171,024 - 435,668 6000-98 Eastport Blvd Richmond, VA - 787,091 - - Eastport VIII Richmond, VA - 379,836 - - Eastport IX Richmond, VA - 209,856 - - Park at Valleypointe Land Roanoke, VA - 238,545 - 406,297 Fairgrounds Distribution Center Land Richmond, VA - 100,000 - 30,304 Mendenhall Land High Point, NC - 2,528,914 - 1,485,493 Independence Pointe Land Greenville, SC - 1,304,084 - 14,855 Southpoint Business Park Land Jacksonville, FL - 756,000 - (317,914) 7024 AC Skinner Parkway Jacksonville, FL - 839,554 - (215,071) 7014 AC Skinner Pkwy Jacksonville, FL - 574,198 - 206,288 Silo Bend Land Tampa, FL - 4,104,030 - 508,590 Cypress Park Land Orlando, FL - 517,445 - 12,489 Exchange Place Land Orlando, FL - 193,406 - 8,711 Liberty Business Park Land Jacksonville, FL - 1,379,053 - 653,370 Airport West Tampa, FL - 67,510 - (67,028) West Tech Park Land (Lot B) Farmington Hills, MI - 455,846 - 9,347 West Tech Park Land (Lot C) Farmington Hills, MI - 368,083 - 7,519 ------------- ------------ -------------- ------------ Subtotal Land Held for Development $ - $ 49,962,515 $ $ 11,941,578 ============= ============ ============== ============ Total All Properties $ 117,375,737 $313,649,086 $1,005,120,296 $777,567,611 ============= ============ ============== ============ * Denotes property is collateralized under mortgages with Nationwide, Principal Mutual, American General and Jackson National Life totalling $246.2 million. ** Rouse leases land from Kent County Council.
55 LIBERTY PROPERTY TRUST REAL ESTATE AND ACCUMULATED DEPRECIATION AS OF DECEMBER 31, 1997
Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE 10,20 Liberty Boulevard Malvern, PA $ 645,318 $ 4,922,084 $ 5,567,402 420 Lapp Road Malvern, PA 1,049,243 6,332,598 7,381,841 1 Chelsea Parkway Boothwyn, PA 245,735 2,610,437 2,856,172 3 Chelsea Parkway Boothwyn, PA 209,177 2,864,067 3,073,244 747 Dresher Road Horsham, PA 1,611,977 3,941,549 5,553,526 45-67 Great Valley Parkway Malvern, PA 795,831 2,845,540 3,641,371 1180 Church Road Lansdale, PA 2,389,598 14,786,322 17,175,920 40 Valley Stream Parkway Malvern, PA 323,792 2,184,948 2,508,740 50 Valley Stream Parkway Malvern, PA 371,068 2,328,630 2,699,698 20 Valley Stream Parkway Malvern, PA 466,413 5,043,549 5,509,962 800 Town Center Drive Langhorne, PA 1,617,803 8,775,533 10,393,336 1610 Medical Drive Pottstown, PA 212,413 2,498,318 2,710,731 9, 15 Great Valley Parkway Malvern, PA 1,837,878 14,959,104 16,796,982 257-275 Great Valley Parkway Malvern, PA 505,458 4,360,723 4,866,181 300 Technology Drive Malvern, PA 374,497 1,287,776 1,662,273 277-293 Great Valley Parkway Malvern, PA 531,534 1,888,300 2,419,834 311 Technology Drive Malvern, PA 348,099 2,245,878 2,593,977 325 Technology Drive Malvern, PA 385,693 1,841,992 2,227,685 7 Great Valley Parkway Malvern, PA 177,317 4,228,959 4,406,276 55 Valley Stream Parkway Malvern, PA 215,818 3,095,596 3,311,414 65 Valley Stream Parkway Malvern, PA 382,361 4,684,211 5,066,572 508 Lapp Road Malvern, PA 263,116 1,768,410 2,031,526 10 Valley Stream Parkway Malvern, PA 465,135 2,680,337 3,145,472 333 Phoenixville Pike Malvern, PA 524,229 3,086,606 3,610,835 1566 Medical Drive Pottstown, PA 203,827 1,843,567 2,047,394 30 Great Valley Parkway Malvern, PA 128,783 354,908 483,691 75 Great Valley Parkway Malvern, PA 143,811 418,152 561,963 27-43 Great Valley Parkway Malvern, PA 449,447 2,084,388 2,533,835 77-123 Great Valley Parkway Malvern, PA 888,359 4,423,219 5,311,578 260 Great Valley Parkway Malvern, PA 212,768 840,159 1,052,927 256 Great Valley Parkway Malvern, PA 161,949 1,887,910 2,049,859 205 Great Valley Parkway Malvern, PA 1,369,003 9,505,668 10,874,671 12,14,16 Great Valley Parkway Malvern, PA 131,517 1,162,260 1,293,777 155 Great Valley Parkway Malvern, PA 626,068 2,197,560 2,823,628 333 Technology Drive Malvern, PA 90,952 2,377,145 2,468,097 510 Lapp Road Malvern, PA 325,415 896,745 1,222,160 181 Wheeler Court Langhorne, PA 263,490 2,043,504 2,306,994 1100 Wheeler Way Langhorne, PA 151,500 1,189,217 1,340,717 60 Morehall Road Malvern, PA 884,974 14,061,835 14,946,809 905 Airport Road West Chester, PA 1,735,012 5,367,089 7,102,101 16 Cabot Boulevard Langhorne, PA 649,743 5,926,232 6,575,975 1 Country View Road Malvern, PA 406,421 3,987,425 4,393,846 2151 Cabot Boulevard Langhorne, PA 389,990 3,714,510 4,104,500 170 South Warner Road King of Prussia, PA 555,911 5,212,074 5,767,985 190 South Warner Road King of Prussia, PA 560,373 4,336,792 4,897,165 507 Prudential Road Horsham, PA 652,919 6,027,128 6,680,047 100 Witmer Road Horsham, PA 3,133,783 9,654,338 12,788,121 3100 Horizon Blvd King of Prussia, PA 611,435 1,997,769 2,609,205 3300 Horizon Blvd King of Prussia, PA 687,878 3,140,188 3,828,066 3500 Horizon Blvd King of Prussia, PA 1,223,875 2,510,960 3,734,836 200 Chester Field Parkway Malvern, PA 495,893 2,860,398 3,356,291 767 Electronic Drive Horsham, PA 1,241,970 2,925,573 4,167,543 5 Country View Road Malvern, PA 786,235 4,812,177 5,598,412 3200 Horizon Blvd King of Prussia, PA 1,210,136 4,009,715 5,219,852 3000 Horizon Blvd King of Prussia, PA 946,703 2,110,444 3,057,147 111-195 Witmer Road Horsham, PA 407,205 3,224,461 3,631,665 300 Welsh Road Horsham, PA 180,459 1,497,418 1,677,877 400 Welsh Road Horsham, PA 282,493 3,202,863 3,485,356 8801 Tinicum Boulevard Philadelphia, PA 124,062 26,777,043 26,901,104 440 East Swedesford Road King of Prussia, PA 717,001 6,106,643 6,823,644 460 East Swedesford Road King of Prussia, PA 705,317 5,038,463 5,743,779 50 Morehall Road Malvern, PA 1,337,076 11,957,142 13,294,218 2 Walnut Grove Drive Horsham, PA 1,265,363 8,470,599 9,735,962 200 Gibralter Road Horsham, PA 638,513 5,884,467 6,522,980 220 Gibralter Road Horsham, PA 629,944 5,745,277 6,375,220 240 Gibralter Road Horsham, PA 629,944 5,745,326 6,375,270 151 S. Warner Road King of Prussia, PA 1,218,086 6,990,891 8,208,977 1 Walnut Grove Drive Horsham, PA 1,058,901 6,138,987 7,197,888 3606 Horizon Boulevard King of Prussia, PA 815,855 1,898,077 2,713,932 650 Swedesford Road King of Prussia, PA 952,911 13,258,401 14,211,312 680 Swedesford Road King of Prussia, PA 952,361 13,391,783 14,344,144 761 Fifth Avenue King of Prussia, PA 256,463 2,100,670 2,357,133 771 Fifth Avenue King of Prussia, PA 152,456 1,316,878 1,469,334 1 Great Valley Parkway Malvern, PA 419,460 3,880,217 4,299,677 5 Great Valley Parkway Malvern, PA 684,200 6,252,273 6,936,473 311 Sinclair Road Bristol, PA 277,901 1,578,945 1,856,846 181-187 Gibralter Road Horsham, PA 440,549 3,983,110 4,423,659 104 Rock Road Horsham, PA 330,111 2,984,003 3,314,114 123-135 Rock Road Horsham, PA 292,360 2,642,755 2,935,115 111-159 Gibralter Road Horsham, PA 489,032 4,420,557 4,909,589 161-175 Gibralter Road Horsham, PA 360,673 3,274,318 3,634,991 125-137 Gibralter Road Horsham, PA 319,906 2,891,761 3,211,667 261-283 Gibralter Road Horsham, PA 494,871 4,473,339 4,968,210 210-223 Witmer Road Horsham, PA 270,282 2,443,188 2,713,470 231-237 Gibralter Road Horsham, PA 506,952 4,582,547 5,089,499 100 Gibralter Road Horsham, PA 38,729 350,085 388,814 101 Gibralter Road Horsham, PA 651,990 5,893,598 6,545,588 506 Prudential Road Horsham, PA 99,140 896,171 995,311 56 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE - Continued 113-123 Rock Road Horsham, PA 351,072 3,173,483 3,524,555 101-111 Rock Road Horsham, PA 350,561 3,168,867 3,519,428 120 Gibralter Road Horsham, PA 533,142 4,863,850 5,396,992 110 Gibralter Road Horsham, PA 655,041 5,921,181 6,576,222 100-107 Lakeside Drive Horsham, PA 239,528 2,165,192 2,404,720 200-264 Lakeside Drive Horsham, PA 502,705 4,697,997 5,200,702 300-309 Lakeside Drive Horsham, PA 369,475 3,341,362 3,710,837 400-445 Lakeside Drive Horsham, PA 543,628 4,914,070 5,457,698 201 Gibralter Road Horsham, PA 380,127 3,508,081 3,888,208 3600 Horizon Drive King of Prussia, PA 236,432 1,869,124 2,105,556 3602 Horizon Drive King of Prussia, PA 217,734 1,767,935 1,985,669 400-500 Brandywine Parkway West Chester, PA 845,846 6,815,254 7,661,100 600 Brandywine Parkway West Chester, PA 664,899 5,357,306 6,022,205 14 Lee Boulevard Malvern, PA 665,053 7,165,358 7,830,411 500 Chester Field Parkway Malvern, PA 473,139 2,872,274 3,345,413 300-400 Chester Field Parkway Malvern, PA 931,212 4,493,762 5,424,974 1805 Underwood Boulevard Delran, NJ 196,901 622,144 819,045 150 Mid-Atlantic Parkway West Deptford, NJ 88,153 435,245 523,398 18 Boulden Circle New Castle, DE 198,062 3,820,336 4,018,398 501 Delran Parkway Delran, NJ 184,162 2,688,742 2,872,904 600 Delran Parkway Delran, NJ 372,719 5,941,662 6,314,381 1607 Imperial Way West Deptford, NJ 288,280 2,750,098 3,038,378 1 Boulden Circle New Castle, DE 93,309 1,337,838 1,431,147 31-55 Read's Way New Castle, DE 972,159 5,517,672 6,489,831 3 Boulden Circle New Castle, DE 126,701 2,105,546 2,232,247 5 Boulden Circle New Castle, DE 232,274 3,501,869 3,734,143 601 Delran Parkway Delran, NJ 193,336 1,635,813 1,829,149 51 Haddonfield Road Cherry Hill, NJ 248,326 9,249,504 9,497,830 57 Read's Way New Castle, DE 352,736 2,710,164 3,062,900 1370 Imperial Way West Deptford, NJ 298,010 4,411,684 4,709,694 8 Stow Road Marlton, NJ 172,945 1,788,021 1,960,966 10 Stow Road Marlton, NJ 147,318 1,461,017 1,608,335 12 Stow Road Marlton, NJ 103,618 1,173,102 1,276,720 14 Stow Road Marlton, NJ 93,418 1,050,772 1,144,190 1300 Metropolitan Avenue West Deptford, NJ 221,218 2,016,048 2,237,266 701A Route 73 South Marlton, NJ 271,743 5,551,423 5,823,166 701C Route 73 South Marlton, NJ 96,161 1,571,661 1,667,821 1008 Astoria Boulevard Cherry Hill, NJ 32,698 796,254 828,952 1475 Imperial Way West Deptford, NJ 58,606 1,028,183 1,086,789 3000 Atrium Way Mt. Laurel, NJ 512,018 7,228,814 7,740,832 750 Cardinal Drive Pureland, NJ 236,190 2,567,291 2,803,481 11000, 15000, 17000 Commerce Parkway Mt. Laurel, NJ 456,465 4,882,510 5,338,975 12000, 14000 Commerce Parkway Mt. Laurel, NJ 362,855 3,423,000 3,785,855 16000, 18000 Commerce Parkway Mt. Laurel, NJ 290,545 2,860,111 3,150,656 406 Lippincott Drive Marlton, NJ 327,554 2,325,633 2,653,187 234 High Hill Road Bridgeport, NJ 250,445 1,812,039 2,062,484 231 Lake Drive New Castle, DE 623,043 3,612,554 4,235,597 100 Arlington Boulevard Bridgeport, NJ 374,836 4,164,997 4,539,833 100 Berkeley Drive Swedesboro, NJ 401,254 2,075,721 2,476,975 301 Lippincott Drive Marlton, NJ 1,069,837 5,161,636 6,231,473 303 Lippincott Drive Marlton, NJ 1,069,837 5,130,128 6,199,965 510-512 Sharptown Road Bridgeport, NJ 125,410 1,107,485 1,232,895 901 Route 73 Marlton, NJ 334,411 2,821,167 3,155,579 Four Greentree Center Marlton, NJ 450,558 3,532,552 3,983,110 512 Sharptown Road Bridgeport, NJ 180,468 1,587,860 1,768,328 15 Boulden Circle New Castle, DE 447,306 2,924,869 3,372,176 404 Lippincott Drive Marlton, NJ 131,896 1,650,600 1,782,496 263 Quigley Blvd New Castle, DE 171,167 1,411,209 1,582,376 34 Blevins Drive New Castle, DE 196,396 1,543,931 1,740,327 104 Gaither Drive Mt Laurel, NJ 136,446 1,367,270 1,503,716 2 Lukens Drive New Castle, DE 169,118 1,387,471 1,556,589 402 Lippincott Drive Marlton, NJ 131,896 1,687,179 1,819,075 3000 Lincoln Drive Mt. Laurel, NJ 284,052 2,497,761 2,781,813 6000 Commerce Parkway Mt. Laurel, NJ 234,151 2,078,937 2,313,088 7000 Commerce Parkway Mt. Laurel, NJ 260,014 2,284,550 2,544,564 8000 Commerce Parkway Mt. Laurel, NJ 234,814 2,027,518 2,262,332 9000 Commerce Parkway Mt. Laurel, NJ 286,587 2,512,181 2,798,768 1000 Briggs Road Mt. Laurel, NJ 288,577 2,751,836 3,040,413 1025 Briggs Road Mt. Laurel, NJ 430,990 3,719,937 4,150,927 2000 Crawford Place Mount Laurel, NJ 310,831 2,936,250 3,247,081 1351 Metropolitan Avenue Thorofare, NJ 189,465 1,738,061 1,927,526 650 Grove Road Thorofare, NJ 267,214 2,443,458 2,710,672 400 Grove Road Thorofare, NJ 145,009 1,328,432 1,473,441 1655 Valley Center Parkway Bethlehem, PA 215,095 1,866,465 2,081,560 6560 Stonegate Drive Allentown, PA 437,122 2,332,118 2,769,240 6370 Hedgewood Drive Allentown, PA 515,707 3,017,780 3,533,487 6390 Hedgewood Drive Allentown, PA 670,819 2,532,765 3,203,584 1495 Valley Center Parkway Bethlehem, PA 258,014 3,762,641 4,020,655 6350 Hedgewood Drive Allentown, PA 360,691 3,103,567 3,464,258 6330 Hedgewood Drive Allentown, PA 499,720 4,235,131 4,734,851 1550 Valley Center Parkway Bethlehem, PA 188,320 3,160,851 3,349,170 1560 Valley Center Parkway Bethlehem, PA 229,301 3,788,881 4,018,182 6580 Snowdrift Road Allentown, PA 367,377 2,457,588 2,824,965 1510 Valley Center Parkway Bethlehem, PA 312,873 3,232,118 3,544,991 1530 Valley Center Parkway Bethlehem, PA 212,491 2,566,445 2,778,936 6540 Stonegate Drive Allentown, PA 422,730 3,559,185 3,981,915 974 Marcon Boulevard Allentown, PA 144,248 2,106,491 2,250,739 964 Marcon Street Allentown, PA 139,480 1,548,845 1,688,325 764 Roble Road Allentown, PA 141,746 793,490 935,236 3174 Airport Road Allentown, PA 98,986 1,088,569 1,187,555 2196 Avenue C Allentown, PA 107,307 1,195,585 1,302,892 2202 Hanger Place Allentown, PA 138,127 1,287,375 1,425,502 2201 Hanger Place Allentown, PA 129,142 1,402,361 1,531,503 57 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE - Continued 954 Marcon Boulevard Allentown, PA 104,452 915,369 1,019,821 57 South Commerce Way Allentown, PA 395,459 2,859,489 3,254,948 754 Roble Road Allentown, PA 163,735 1,792,031 1,955,766 894 Marcon Boulevard Allentown, PA 118,304 1,071,130 1,189,434 744 Roble Road Allentown, PA 161,371 1,856,213 2,017,584 944 Marcon Boulevard Allentown, PA 119,711 1,575,464 1,695,175 1685 Valley Center Parkway Allentown, PA 198,482 2,096,656 2,295,138 6520 Stonegate Drive Allentown, PA 948,395 1,330,099 2,278,494 7437 Industrial Boulevard Allentown, PA 726,651 6,343,905 7,070,556 2041 Avenue C Allentown, PA 213,879 1,163,975 1,377,854 2124 Avenue C Allentown, PA 289,529 1,093,852 1,383,381 7339 Industrial Boulevard Allentown, PA 1,197,448 5,637,547 6,834,995 7384 Penn Drive Allentown, PA 652,118 2,696,467 3,348,585 7144 Daniels Drive Allentown, PA 1,579,169 6,572,363 8,151,532 7620 Cetronia Road Allentown, PA 1,093,724 3,970,568 5,064,292 939 Marcon Blvd Allentown, PA 2,220,548 5,258,261 7,478,809 100 Brodhead Road Allentown, PA 429,456 3,080,226 3,509,682 1455 Valley Center Parkway Bethlehem, PA 545,173 3,780,394 4,325,567 1640 Valley Center Parkway Bethlehem, PA 190,728 2,582,488 2,773,216 1650 Valley Center Parkway Allentown, PA 188,896 2,396,077 2,584,973 400 Nestle Way Allentown, PA 8,184,096 26,293,838 34,477,934 83 South Commerce Way Bethlehem, PA 212,744 995,626 1,208,369 85 South Commerce Way Bethlehem, PA 237,078 1,066,365 1,303,443 87 South Commerce Way Bethlehem, PA 253,886 1,138,811 1,392,696 7339 Industrial Blvd Allentown, PA 2,670,673 13,852,476 16,523,149 95 Highland Avenue Bethlehem, PA 430,593 3,460,672 3,891,265 236 Brodhead Road Bethlehem, PA 376,962 4,672,683 5,049,645 6620 Grant Way Allentown, PA 430,824 1,920,164 2,350,988 7562 Penn Drive Allentown, PA 269,614 848,149 1,117,763 7277 Williams Avenue Allentown, PA 462,964 1,456,080 1,919,044 180,190 Cochrane Drive Annapolis, MD 3,752,293 16,047,261 19,799,554 12000,001,040 Indian Creek Court Beltsville, MD 2,698,195 10,031,702 12,729,897 8280 Patuxent Range Drive Columbia, MD 181,601 1,294,623 1,476,224 7178-80 Columbia Gateway Columbia, MD 1,571,105 5,137,364 6,708,469 8730 Bollman Place Columbia, MD 626,269 4,652,665 5,278,934 9770 Patuxent Woods Drive Columbia, MD 341,663 3,037,517 3,379,180 9780 Patuxent Woods Drive Columbia, MD 218,542 1,943,328 2,161,870 9790 Patuxent Woods Drive Columbia, MD 243,791 2,167,132 2,410,923 9810 Patuxent Woods Drive Columbia, MD 266,684 2,370,185 2,636,869 9800 Patuxent Woods Drive Columbia, MD 299,099 2,657,753 2,956,852 9820 Patuxent Woods Drive Columbia, MD 237,779 2,113,763 2,351,542 9830 Patuxent Woods Drive Columbia, MD 296,262 2,632,624 2,928,886 9050 Red Branch Road Columbia, MD 290,950 2,578,253 2,869,203 9101,9111,9115 Guilford Road Columbia, MD 765,953 3,034,462 3,800,415 9125,9135,9145 Guilford Road Columbia, MD 920,439 5,566,828 6,487,267 10 South Third Street Richmond, VA 27,970 173,381 201,351 1751 Bluehills Drive Roanoke, VA 1,063,728 8,602,628 9,666,356 4300 Carolina Avenue Richmond, VA 2,009,136 15,337,786 17,346,923 301 Hill Carter Parkway Richmond, VA 659,456 4,899,214 5,558,670 4001 Carolina Avenue Richmond, VA 29,443 231,348 260,791 5600-5626 Eastport Boulevard Richmond, VA 489,941 3,712,812 4,202,753 5650-5674 Eastport Boulevard Richmond, VA 644,384 4,158,230 4,802,614 5700 Eastport Boulevard Richmond, VA 408,729 2,740,967 3,149,696 11020 Hull Street Road Richmond, VA 139,887 646,199 786,086 3432 Holland Road Virginia Beach, VA 173,527 801,603 975,130 3001 Hungary Springs Road Richmond, VA 136,270 605,069 741,339 7760 Shrader Road Richmond, VA 187,971 773,504 961,475 7740 Shrader Road Richmond, VA 81,200 407,972 489,172 4880 Cox Road Richmond, VA 743,898 5,664,973 6,408,871 5162 Valleypointe Parkway Roanoke, VA 551,483 2,647,549 3,199,032 4101- 4127 Carolina Avenue Richmond, VA 310,854 2,325,262 2,636,116 4201-4261 Carolina Avenue Richmond, VA 693,203 5,200,664 5,893,867 4263-4299 Carolina Avenue Richmond, VA 256,203 2,706,017 2,962,220 4301-4335 Carolina Avenue Richmond, VA 223,696 1,756,663 1,980,359 4337-4379 Carolina Avenue Richmond, VA 325,203 2,708,253 3,033,456 4501-4549 Carolina Avenue Richmond, VA 486,166 3,666,303 4,152,469 4551-4593 Carolina Avenue Richmond, VA 474,360 3,564,260 4,038,620 4601-4643 Carolina Avenue Richmond, VA 652,455 5,052,828 5,705,283 4545-4583 Carolina Avenue Richmond, VA 404,616 3,764,453 4,169,069 4447-4491 Carolina Avenue Richmond, VA 454,056 2,792,858 3,246,914 4401-4445 Carolina Avenue Richmond, VA 615,038 4,586,058 5,201,096 12 S. Third Street Richmond, VA 40,539 190,807 231,346 9601 Cosner Drive Fredericksburg, VA 476,262 4,065,136 4,541,398 315 Cardiff Valley Road Knoxville, TN 443,305 2,993,390 3,436,695 2300 East Parham Road Richmond, VA 221,947 1,025,269 1,247,216 1347 Diamond Springs Road Virginia Beach, VA 436,898 3,285,338 3,722,236 5221 Valleypark Drive - Bldg A Roanoke, VA 285,008 1,222,705 1,507,713 5228 Valleypointe Parkway - Bldg B Roanoke, VA 218,663 893,385 1,112,048 5238 Valleypark Drive - Bldg C Roanoke, VA 416,375 1,988,562 2,404,937 5601-5659 Eastport Boulevard Richmond, VA 720,100 4,700,314 5,420,413 5900 Eastport Boulevard Richmond, VA 687,898 4,405,021 5,092,919 4717-4729 Eubank Road Richmond, VA 452,263 3,380,356 3,832,619 5251 Concourse Drive Roanoke, VA 217,690 1,537,383 1,755,073 4263F-N. Carolina Ave Richmond, VA 91,599 1,622,583 1,714,183 4200 Oakleys Court Richmond, VA 459,653 2,499,114 2,958,767 1821 Battery Dantzler Road Chester, VA 392,332 3,055,327 3,447,658 5000 Cox Road Glen Allen, VA 771,029 3,713,177 4,484,206 510 Eastpark Court Sandston, VA 262,210 2,147,777 2,409,987 520 Eastpark Court Sandston, VA 486,598 4,130,906 4,617,504 600 Liberty Way Chesterfield, VA 502,382 4,884,026 5,386,408 500 Liberty Way Chesterfield, VA 491,919 4,152,094 4,644,013 4198 Cox Road Glen Allen, VA 670,292 3,839,245 4,509,537 4510 Cox Road Glen Allen, VA 1,010,024 7,488,280 8,498,304 58 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE - Continued 2809 South Lynnhaven Road Virginia Beach, VA 953,590 6,150,257 7,103,847 200 Golden Oak Court Virginia Beach, VA 1,116,693 6,779,282 7,895,975 208 Golden Oak Court Virginia Beach, VA 965,177 6,736,323 7,701,500 1 Enterprise Parkway Hampton, VA 974,675 5,587,553 6,562,228 22 Enterprise Parkway Hampton, VA 1,097,368 6,769,420 7,866,788 4523 Green Point Drive High Point, NC 223,614 1,933,947 2,157,561 4501 Green Point Drive High Point, NC 320,450 2,212,040 2,532,490 4500 Green Point Drive High Point, NC 231,692 1,993,560 2,225,252 2427 Penny Road High Point, NC 1,168,074 6,184,618 7,352,692 4524 Green Point Drive High Point, NC 183,888 2,103,328 2,287,216 4328, 4336 Federal Drive High Point, NC 825,092 7,340,082 8,165,174 200 Centreport Drive Greensboro, NC 332,017 4,012,141 4,344,158 4344 Federal Drive High Point, NC 173,623 2,634,555 2,808,178 202 Centreport Drive Greensboro, NC 549,679 5,509,790 6,059,469 4000 Piedmont Parkway High Point, NC 592,885 4,962,473 5,555,358 4380 Federal Drive High Point, NC 283,368 2,033,889 2,317,258 4388 Federal Drive High Point, NC 132,655 1,130,117 1,262,771 6532 Judge Adams Road Rock Creek, NC 399,988 3,459,676 3,859,664 3860 Faber Place N. Charleston, SC 796,655 1,974,359 2,771,014 4055 Faber Place N. Charleston, SC 882,352 4,794,144 5,676,496 3820 Faber Place N. Charleston, SC 506,558 2,365,146 2,871,704 440 Knox Abbott Drive Cayce, SC 576,767 3,448,352 4,025,119 Alcoa Fujikura Facility Duncan, SC 711,353 8,056,324 8,767,677 1320 Garlington Road Greenville, SC 398,539 1,761,533 2,160,072 9800 Twin Lakes Parkway Charlotte, NC 420,079 2,152,047 2,572,126 420 Park Avenue Greenville, SC 522,548 3,006,148 3,528,696 111 Southchase Blvd. Fountain Inn, SC 499,065 4,861,899 5,360,964 300 International Blvd. Fountain Inn, SC 180,560 639,305 819,865 1208 Eastchester Drive High Point, NC 487,209 4,365,146 4,852,355 One Independence Pointe Greenville, SC 780,881 6,215,187 6,996,068 55 Beattie Place Greenville, SC 2,643,105 23,459,278 26,102,383 75 Beattie Place Greenville, SC 2,406,646 17,418,705 19,825,351 1730 Stebbins Drive Houston, TX 144,016 412,656 556,672 5911-5925 Richard Street Jacksonville, FL 286,335 497,306 783,641 8383-8385 Baycenter Road Jacksonville, FL 65,329 525,694 591,023 8775 Baypine Road Jacksonville, FL 913,264 2,886,335 3,799,599 8539 Western Way Jacksonville, FL 631,558 2,823,712 3,455,270 6255 Lake Gray Boulevard Jacksonville, FL 811,963 3,294,525 4,106,488 6600-6660 Suemac Place Jacksonville, FL 216,014 1,886,261 2,102,275 6800-6850 Suemac Place Jacksonville, FL 125,576 973,671 1,099,247 8665,8667,8669 Baypine Road Jacksonville, FL 1,023,514 3,854,512 4,878,026 8540 Baycenter Road Jacksonville, FL 450,431 1,366,708 1,817,139 1200 Gulf Life Drive Jacksonville, FL 1,035,091 16,759,300 17,794,391 8400 Baymeadows Way Jacksonville, FL 566,370 2,323,186 2,889,556 8614 Baymeadows Way Jacksonville, FL 312,761 1,088,410 1,401,171 5941-5975 Richard Street Jacksonville, FL 585,280 1,111,567 1,696,847 7970 Bayberry Road Jacksonville, FL 129,979 1,197,124 1,327,103 6000-6030 Bowdendale Avenue Jacksonville, FL 275,475 1,513,480 1,788,955 7898 Baymeadows Way Jacksonville, FL 568,005 1,966,127 2,534,132 5977-6607 Richard Street Jacksonville, FL 182,747 1,562,967 1,745,714 7910 & 7948 Baymeadows Way Jacksonville, FL 211,449 2,677,564 2,889,013 7954 & 7960 Baymeadows Way Jacksonville, FL 292,667 2,978,826 3,271,493 8787 Baypine Road Jacksonville, FL 2,045,574 34,536,694 36,582,268 7077 Bonneval Road Jacksonville, FL 774,020 6,566,676 7,340,696 4190 Belfort Road Jacksonville, FL 827,420 6,867,187 7,694,607 8011, 8021, 8031 Phillips Highway Jacksonville, FL 628,437 3,958,206 4,586,643 7020 AC Skinner Parkway Jacksonville, FL 749,811 2,150,255 2,900,066 7040 AC Skinner Parkway Jacksonville, FL 853,981 2,963,746 3,817,726 11777 Central Highway Jacksonville, FL 192,004 1,818,777 2,010,781 7016 AC Skinner Parkway Jacksonville, FL 602,633 2,320,994 2,923,626 7018 AC Skinner Parkway Jacksonville, FL 846,433 4,000,189 4,846,621 6620 Southpoint Drive Jacksonville, FL 614,602 4,442,853 5,057,455 7980 Bayberry Road Jacksonville, FL 330,726 1,341,221 1,671,947 9600 Satellite Boulevard Orlando, FL 252,850 1,305,541 1,558,391 9700 Satellite Boulevard Orlando, FL 405,362 1,154,163 1,559,525 1902 Cypress Lake Drive Orlando, FL 523,512 3,401,938 3,925,450 8250 & 8256 Exchange Place Orlando, FL 622,413 2,534,413 3,156,826 6600 Southpoint Parkway Jacksonville, FL 998,432 4,068,675 5,067,107 6700 Southpoint Parkway Jacksonville, FL 620,719 3,187,347 3,808,066 4801 Executive Park Court - 100 Jacksonville, FL 554,542 4,572,699 5,127,241 4801 Executive Park Court - 200 Jacksonville, FL 370,039 1,950,468 2,320,507 4810 Executive Park Court Jacksonville, FL 370,039 1,950,468 2,320,507 6602 Executive Park Court - 100 Jacksonville, FL 388,541 2,047,991 2,436,532 6602 Executive Park Court - 200 Jacksonville, FL 296,032 1,560,374 1,856,406 6631 Executive Park Court - 100 Jacksonville, FL 251,627 1,326,318 1,577,945 6631 Executive Park Court - 200 Jacksonville, FL 407,043 2,145,514 2,552,557 4815 Executive Park Court - 100 Jacksonville, FL 366,339 1,930,963 2,297,302 4815 Executive Park Court - 200 Jacksonville, FL 462,549 2,438,084 2,900,633 4825 Executive Park Court Jacksonville, FL 601,314 3,169,509 3,770,823 4820 Executive Park Court Jacksonville, FL 555,213 2,625,550 3,180,763 10511 & 10611 Satellite Boulevard Orlando, FL 517,554 2,571,942 3,089,496 1400-1440 Central Florida Parkway Orlando, FL 518,043 2,566,496 3,084,539 4001,4051,4101 Fowler Avenue Tampa, FL 1,293,206 4,661,074 5,954,280 5501-5502 Pioneer Park Boulevard Tampa, FL 262,416 1,730,428 1,992,844 5690-5694 Crenshaw Street Tampa, FL 181,923 1,842,980 2,024,903 3102,3104,3110 Cherry Palm Drive Tampa, FL 503,767 2,831,411 3,335,178 8401-8408 Benjamin Road Tampa, FL 789,652 4,691,528 5,481,180 3501 Riga Blvd Tampa, FL 617,289 3,049,755 3,667,044 111 Kelsey Land Tampa, FL 359,540 1,509,725 1,869,265 7930, 8010-20 Woodland Center Tampa, FL 1,408,478 5,247,246 6,655,724 7920 Woodland Center Boulevard Tampa, FL 1,382,648 2,838,862 4,221,510 8154-8198 Woodland Center Tampa, FL 399,088 2,868,834 3,267,922 8112-42 Woodland Center Tampa, FL 513,263 3,230,239 3,743,502 59 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE - Continued 8212 Woodland Center Tampa, FL 820,882 2,579,475 3,400,357 1701 Clint Moore Blvd Boca Raton, FL 1,430,884 3,056,086 4,486,970 4555 Riverside Drive Beach Gardens, FL 805,672 5,788,766 6,594,438 2500 Metrocentre Boulevard West Palm Beach, FL 238,362 1,536,721 1,775,083 2540 Metrocenter Boulevard West Palm Beach, FL 165,071 1,059,970 1,225,041 2541 Metrocentre Boulevard West Palm Beach, FL 145,091 936,094 1,081,185 2580 Metrocentre Boulevard West Palm Beach, FL 256,478 1,653,533 1,910,011 2581 Metrocentre Boulevard West Palm Beach, FL 189,359 1,220,568 1,409,927 5410 - 5430 Northwest 33rd Avenue Ft. Lauderdale, FL 603,776 4,180,719 4,784,495 2905 Northwest Boulevard Plymouth, MN 516,920 4,757,980 5,274,900 2800 Campus Drive Plymouth, MN 395,366 3,692,714 4,088,080 2955 Xenium Lane Plymouth, MN 151,238 1,379,653 1,530,891 9401-9443 Science Center Drive New Hope, MN 431,295 3,926,207 4,357,502 6321-6325 Bury Drive Eden Prairie, MN 462,876 4,166,578 4,629,454 7115-7173 Shady Oak Road Eden Prairie, MN 454,974 4,138,741 4,593,715 7660-7716 Golden Triangle Drive Eden Prairie, MN 568,706 5,105,565 5,674,271 7400 Flying Cloud Drive Eden Prairie, MN 195,982 1,762,027 1,958,009 330 Second Avenue Minneapolis, MN 2,168,572 13,608,048 15,776,621 10301-10305 West 70th Street Eden Prairie, MN 120,622 1,156,790 1,277,412 10321 West 70th Street Eden Prairie, MN 145,198 1,337,090 1,482,288 10333 West 70th Street Eden Prairie, MN 110,746 1,022,867 1,133,613 10349-10357 West 70th Street Eden Prairie, MN 275,903 2,736,992 3,012,895 10365-10375 West 70th Street Eden Prairie, MN 291,077 2,632,464 2,923,541 10393-10394 West 70th Street Eden Prairie, MN 269,618 2,647,513 2,917,132 7078 Shady Oak Road Eden Prairie, MN 343,093 3,088,933 3,432,026 5600 & 5610 Rowland Road Minnetonka, MN 828,650 7,452,441 8,281,091 2920 Northwest Boulevard Plymouth, MN 392,026 3,459,945 3,851,971 26911-26957 Northwestern Southfield, MI 11,416,220 66,268,817 77,685,037 1650 Research Drive Troy, MI 763,067 7,240,849 8,003,916 1775 Research Drive Troy, MI 331,422 2,825,747 3,157,169 1875 Research Drive Troy, MI 329,863 2,811,681 3,141,544 1850 Research Drive Troy, MI 781,054 7,404,371 8,185,425 1965 Research Drive Troy, MI 419,090 3,616,603 4,035,693 1960 Research Drive Troy, MI 419,146 3,616,841 4,035,987 27260 Haggerty Road Farmington Hills, MI 456,877 4,104,941 4,561,818 27200 Haggerty Road Farmington Hills, MI 382,754 3,434,318 3,817,072 27280 Haggerty Road Farmington Hills, MI 452,860 4,067,692 4,520,552 27220 Haggerty Road Farmington Hills, MI 203,064 1,813,399 2,016,463 27240 Haggerty Road Farmington Hills, MI 171,518 1,528,882 1,700,400 27300 Haggerty Road Farmington Hills, MI 370,378 3,334,999 3,705,377 1101 Allen Drive Troy, MI 98,144 893,368 991,512 1151 Allen Drive Troy, MI 164,483 1,493,391 1,657,874 1300 Rankin Street Troy, MI 134,090 1,212,839 1,346,929 1350 Rankin Street Troy, MI 111,776 1,011,570 1,123,346 1376-1400 Rankin Street Troy, MI 134,292 1,230,846 1,365,138 1352-1374 Rankin Street Troy, MI 153,275 1,386,279 1,539,554 1324-1346 Rankin Street Troy, MI 134,090 1,213,243 1,347,333 1301-1307 Rankin Street Troy, MI 111,776 1,011,974 1,123,750 1409 Allen Drive Troy, MI 142,370 1,301,421 1,443,791 1304 E Maple Road Troy, MI 211,233 1,908,428 2,119,661 1334 Maplelawn Road Troy, MI 124,296 1,123,762 1,248,058 1290 Maplelawn Road Troy, MI 85,321 772,274 857,595 1070 Maplelawn Road Troy, MI 68,560 621,115 689,675 950 Maplelawn Road Troy, MI 252,429 2,278,097 2,530,526 894 Maplelawn Road Troy, MI 181,749 1,641,477 1,823,226 1179 Maplelawn Road Troy, MI 87,845 795,038 882,883 1940 Norwood Drive Troy, MI 86,836 785,933 872,769 1311-1331 Maplelawn Road Troy, MI 125,407 1,133,779 1,259,186 2354 Bellingham Street Troy, MI 87,340 790,487 877,827 2360 Bellingham Street Troy, MI 87,340 790,487 877,827 1911 Ring Drive Troy, MI 86,129 779,559 865,688 26442-26450 Haggerty Road Farmington Hills, MI 237,687 2,151,202 2,388,889 26500 Haggerty Road Farmington Hills, MI 311,093 2,818,580 3,129,673 26650 Haggerty Road Farmington Hills, MI 173,166 1,569,915 1,743,081 26700 Haggerty Road Farmington Hills, MI 253,338 2,292,637 2,545,975 26750 Haggerty Road Farmington Hills, MI 292,717 2,646,852 2,939,569 26800 Haggerty Road Farmington Hills, MI 175,489 1,590,592 1,766,081 26842-26850 Haggerty Road Farmington Hills, MI 239,606 2,168,211 2,407,817 50 Gibson Drive West Malling, UK - 3,746,462 3,746,462 25 Kings Hill Avenue West Malling, UK 1,291,493 5,465,327 6,756,820 2 Kings Hill Avenue West Malling, UK 845,147 4,769,535 5,614,682 50 Kings Hill Avenue West Malling, UK 1,311,758 13,438,926 14,750,684 ------------ -------------- -------------- Subtotal Operating Real Estate $238,518,514 $1,639,820,930 $1,878,339,444 ============ ============== ============== DEVELOPMENT PROPERTIES 132 Welsh Road Horsham, PA $ 1,408,042 $ 3,031,677 $ 4,439,719 3604 Horizon Blvd King of Prussia, PA 350,873 1,881,665 2,232,538 100 Cedar Hollow Road Malvern, PA 1,640,999 5,077,180 6,718,179 3 Country View Road Malvern, PA 1,128,279 2,183,205 3,311,484 425 Technology Drive Malvern, PA 321,473 1,101,236 1,422,709 375 Technology Drive Malvern, PA 234,922 205,474 440,396 100 Chesterfield Pkwy Malvern, PA 1,349,954 860,442 2,210,396 201 Berkeley Drive Bridgeport, NJ 273,915 1,080,677 1,354,591 300 Commodore Drive Bridgeport, NJ 593,492 1,610,632 2,204,124 1660 Valley Center Parkway Bethlehem, PA 188,721 1,819,127 2,007,848 89 South Commerce Way Bethlehem, PA 368,019 1,353,514 1,721,533 1525 Valley Ctr Pkwy Allentown, PA 804,060 3,601,914 4,405,974 700 Nestle Way Allentown, PA 4,174,970 15,327,585 19,502,555 5500 Cox Road Richmond, VA 483,778 1,416,596 1,900,374 13001 Kingston Ave Richmond, VA 376,700 1,723,151 2,099,851 60 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- DEVELOPMENT PROPERTIES - Continued 5701-5799 Eastport Blvd Richmond, VA 700,503 4,718,742 5,419,245 4801 Cox Road Richmond, VA 1,075,620 3,209,545 4,285,165 701 Liberty Way Richmond, VA 543,260 3,230,669 3,773,929 5310 Valley Park Drive Roanoke, VA 127,361 551,185 678,546 5305 Valley Park Drive Roanoke, VA 228,124 642,427 870,551 530 Eastpark Court Sandston, VA 333,597 1,056,066 1,389,663 101 Centreport Greensboro, NC 826,237 5,225,165 6,051,402 6532 Judge Adams Road Whitsett, NC 335,061 3,135,245 3,470,306 3875 Faber Place N. Charleston, SC 1,166,052 5,391,988 6,558,040 1 Alliance Drive Goose Creek, SC 662,422 1,468,894 2,131,316 1150 Northpoint Blvd Blythwood, SC 741,692 1,348,001 2,089,693 4160 Mendenhall Oaks Pkwy High Point, NC 544,945 2,363,696 2,908,641 4194 Mendenhall Oaks Pkwy High Point, NC 265,887 1,215,193 1,481,080 4196 Mendenhall Oaks Pkwy High Point, NC 173,785 1,106,704 1,280,489 4170 Mendenhall Oaks Pkwy High Point, NC 372,849 1,196,531 1,569,380 4180 Mendenhall Oaks Pkwy High Point, NC 314,960 997,399 1,312,359 7720 Mendenhall Oaks Pkwy High Point, NC 1,995,876 8,019,073 10,014,949 4345 Southpoint Parkway Jacksonville, FL 418,093 7,326,703 7,744,796 131 Silo Bend Tampa, FL 559,435 1,739,513 2,298,947 7724 Woodland Ctr Blvd Tampa, FL 235,894 503,830 739,724 7802-50 Woodland Ctr Blvd Tampa, FL 357,364 676,414 1,033,778 7852-98 Woodland Ctr Blvd Tampa, FL 357,364 725,779 1,083,143 8921 Brittany Way Tampa, FL 252,230 125,468 377,698 6601-6625 W. 78th Street Bloomington, MN 2,303,774 13,289,972 15,593,746 10400 Southwest Crossing Eden Prairie, MN 2,998,225 1,719,522 4,717,747 10 Kings Hill Ave West Malling, UK 983,547 3,008,337 3,991,884 30 Tower View West Malling, UK 1,657,321 2,546,004 4,203,325 35 Kings Hill Ave West Malling, UK 812,193 2,239,449 3,051,642 ------------- -------------- -------------- Subtotal Development in Progress $ 35,041,868 $ 121,051,587 $ 156,093,455 ============= ============== ============== LAND HELD FOR DEVELOPMENT Chelsea Business Park Land Boothwyn, PA 1,896,888 - 1,896,888 Gwynedd North Bus Camp Land Lansdale, PA 257,945 - 257,945 Three Country View Road Malvern, PA - 6,177 6,177 550 Lapp Road Malvern, PA - 2,575 2,574 Cedar Hollow Road Land Malvern, PA - - - Walnut Grove Land Horsham, PA 3,938,855 - 3,938,855 Iron Run Land Upper Macungie, PA 788,281 - 788,281 35 Liberty Blvd Land Malvern, PA - - - 45 Liberty Blvd Land Malvern, PA 4,579,317 - 4,579,317 Great Valley Land Malvern, PA 4,905,740 - 4,905,740 10 Matthews Rd South Land Malvern, PA 608,995 - 608,995 104 Witmer Road Horsham, PA 1,248,148 - 1,248,148 3 Franklin Plaza Philadelphia, PA 2,503,348 - 2,503,348 2700 Horizon Dr King of Prussia, PA 767,949 - 767,949 2900 Horizon Dr King of Prussia, PA 682,621 - 682,621 2500 Renaissance Blvd King of Prussia, PA 511,967 - 511,967 2300 Renaissance Blvd King of Prussia, PA 511,967 - 511,967 Swedes Run Business Park Land Delran, NJ 1,615,405 - 1,615,405 Marlton Crossing Land Marlton, NJ 239,746 10,749 250,496 Commodore Business Park Logan Twp., NJ 4,363,233 20,451 4,383,684 Boulden Land New Castle, DE - - - Marlton Executive Park Land Marlton, NJ 765,862 - 765,862 17 Boulden Circle New Castle, DE 386,057 301,414 687,471 1015 Briggs Road Land Mt. Laurel, NJ 373,373 - 373,373 1020 Briggs Road Land Mt. Laurel, NJ 533,259 - 533,259 Lehigh Valley Corporate Center Land Bethlehem, PA 1,249,539 60,449 1,309,988 Rivers' Bend Land Chesterfield Cty, VA 3,026,870 5,433,211 8,460,081 Oakleys Center Land Richmond, VA 286,142 - 286,142 Woodlands Center Land Sandston, VA 1,276,171 - 1,276,171 501 Liberty Way Chesterfield City, VA 597,995 - 597,995 601 Hewlett Packard Way Chesterfield City, VA 606,692 - 606,692 6000-98 Eastport Blvd Richmond, VA 787,091 - 787,091 Eastport VIII Richmond, VA 379,836 - 379,836 Eastport IX Richmond, VA 209,856 - 209,856 Park at Valleypointe Land Roanoke, VA 640,121 4,722 644,842 Fairgrounds Distribution Center Land Richmond, VA 129,107 1,197 130,304 Mendenhall Land High Point, NC 4,006,549 7,858 4,014,407 Independence Pointe Land Greenville, SC 1,318,939 - 1,318,939 Southpoint Business Park Land Jacksonville, FL 438,086 - 438,086 Liberty Business Park Land Jacksonville, FL 2,004,862 27,561 2,032,423 7024 AC Skinner Parkway Jacksonville, FL 624,483 - 624,483 7014 AC Skinner Pkwy Jacksonville, FL 780,486 - 780,486 Silo Bend Land Tampa, FL 4,612,621 - 4,612,620 Cypress Park Land Orlando, FL 529,934 - 529,934 Exchange Place Land Orlando, FL 202,117 - 202,117 Airport West Tampa, FL - 482 481 West Tech Park Land (Lot B) Farmington Hills, MI 461,341 3,852 465,193 West Tech Park Land (Lot C) Farmington Hills, MI 370,485 5,117 375,602 ------------ -------------- -------------- Subtotal Land Held for Development $ 56,018,279 $ 5,885,815 $ 61,904,094 ============ ============== ============== Total All Properties $329,578,661 $1,766,758,332 $2,096,336,993 ============ ============== ============== * Denotes property is collateralized under mortgages with Nationwide, Principal Mutual, American General and Jackson National Life totalling $246.2 million. ** Rouse leases land from Kent County Council.
61 LIBERTY PROPERTY TRUST REAL ESTATE AND ACCUMULATED DEPRECIATION AS OF DECEMBER 31, 1997
Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE 10,20 Liberty Boulevard Malvern, PA 919,946 1985 40 yrs. 420 Lapp Road Malvern, PA 1,126,400 1989 40 yrs. 1 Chelsea Parkway Boothwyn, PA 634,371 1989 40 yrs. 3 Chelsea Parkway Boothwyn, PA 550,687 1989 40 yrs. 747 Dresher Road Horsham, PA 795,626 1988 40 yrs. 45-67 Great Valley Parkway Malvern, PA 1,420,325 1974 40 yrs. 1180 Church Road Lansdale, PA 3,656,856 1986 40 yrs. 40 Valley Stream Parkway Malvern, PA 555,883 1987 40 yrs. 50 Valley Stream Parkway Malvern, PA 624,310 1987 40 yrs. 20 Valley Stream Parkway Malvern, PA 1,225,543 1987 40 yrs. 800 Town Center Drive Langhorne, PA 2,154,770 1987 40 yrs. 1610 Medical Drive Pottstown, PA 639,027 1986 40 yrs. 9, 15 Great Valley Parkway Malvern, PA 7,619,067 1986 40 yrs. 257-275 Great Valley Parkway Malvern, PA 1,402,123 1983 40 yrs. 300 Technology Drive Malvern, PA 342,683 1985 40 yrs. 277-293 Great Valley Parkway Malvern, PA 611,676 1984 40 yrs. 311 Technology Drive Malvern, PA 660,877 1984 40 yrs. 325 Technology Drive Malvern, PA 548,649 1984 40 yrs. 7 Great Valley Parkway Malvern, PA 1,226,412 1985 40 yrs. 55 Valley Stream Parkway Malvern, PA 902,087 1983 40 yrs. 65 Valley Stream Parkway Malvern, PA 1,419,757 1983 40 yrs. 508 Lapp Road Malvern, PA 547,917 1984 40 yrs. 10 Valley Stream Parkway Malvern, PA 835,717 1984 40 yrs. 333 Phoenixville Pike Malvern, PA 878,298 1985 40 yrs. 1566 Medical Drive Pottstown, PA 523,204 1985 40 yrs. 30 Great Valley Parkway Malvern, PA 203,079 1975 40 yrs. 75 Great Valley Parkway Malvern, PA 174,422 1977 40 yrs. 27-43 Great Valley Parkway Malvern, PA 944,195 1977 40 yrs. 77-123 Great Valley Parkway Malvern, PA 1,808,402 1978 40 yrs. 260 Great Valley Parkway Malvern, PA 301,673 1979 40 yrs. 256 Great Valley Parkway Malvern, PA 726,954 1980 40 yrs. 205 Great Valley Parkway Malvern, PA 3,445,143 1981 40 yrs. 12,14,16 Great Valley Parkway Malvern, PA 475,765 1982 40 yrs. 155 Great Valley Parkway Malvern, PA 797,405 1981 40 yrs. 333 Technology Drive Malvern, PA 927,197 1987 40 yrs. 510 Lapp Road Malvern, PA 325,910 1983 40 yrs. 181 Wheeler Court Langhorne, PA 174,990 1979 40 yrs. 1100 Wheeler Way Langhorne, PA 101,879 1979 40 yrs. 60 Morehall Road Malvern, PA 858,560 1989 40 yrs. 905 Airport Road West Chester, PA 494,974 1988 40 yrs. 16 Cabot Boulevard Langhorne, PA 493,741 1972 40 yrs. 1 Country View Road Malvern, PA 319,213 1982 40 yrs. 2151 Cabot Boulevard Langhorne, PA 290,898 1982 40 yrs. 170 South Warner Road King of Prussia, PA 748,252 1980 40 yrs. 190 South Warner Road King of Prussia, PA 418,560 1980 40 yrs. 507 Prudential Road Horsham, PA 450,511 1988 40 yrs. 100 Witmer Road Horsham, PA 390,055 1995 40 yrs. 3100 Horizon Blvd King of Prussia, PA 107,994 1995 40 yrs. 3300 Horizon Blvd King of Prussia, PA 174,718 1996 40 yrs. 3500 Horizon Blvd King of Prussia, PA 111,087 1996 40 yrs. 200 Chester Field Parkway Malvern, PA 1,205,217 1989 40 yrs. 767 Electronic Drive Horsham, PA 239,158 1996 40 yrs. 5 Country View Road Malvern, PA 277,065 1985 40 yrs. 3200 Horizon Blvd King of Prussia, PA 176,009 1996 40 yrs. 3000 Horizon Boulevard King of Prussia, PA 29,807 1997 40 yrs. 111-195 Witmer Road Horsham, PA 131,498 1996 40 yrs. 300 Welsh Road Horsham, PA 65,448 1983 40 yrs. 400 Welsh Road Horsham, PA 117,235 1983 40 yrs. 8801 Tinicum Boulevard Philadelphia, PA 117,996 1997 40 yrs. 440 East Swedesford Road King of Prussia, PA 325,940 1988 40 yrs. 460 East Swedesford Road King of Prussia, PA 217,436 1988 40 yrs. 50 Morehall Road Malvern, PA 187,593 1997 40 yrs. 2 Walnut Grove Drive Horsham, PA 254,125 1989 40 yrs. 200 Gibralter Road Horsham, PA 146,902 1990 40 yrs. 220 Gibralter Road Horsham, PA 143,548 1990 40 yrs. 240 Gibralter Road Horsham, PA 143,546 1990 40 yrs. 151 S. Warner Road King of Prussia, PA 175,497 1980 40 yrs. 1 Walnut Grove Drive Horsham, PA 227,236 1986 40 yrs. 3606 Horizon Boulevard King of Prussia, PA 31,917 1997 40 yrs. 650 Swedesford Road King of Prussia, PA 184,063 1971 40 yrs. 680 Swedesford Road King of Prussia, PA 268,001 1971 40 yrs. 761 Fifth Avenue King of Prussia, PA 17,366 1977 40 yrs. 771 Fifth Avenue King of Prussia, PA 8,496 1977 40 yrs. 1 Great Valley Parkway Malvern, PA 49,348 1982 40 yrs. 5 Great Valley Parkway Malvern, PA 79,285 1983 40 yrs. 311 Sinclair Road Bristol, PA 3,314 1997 40 yrs. 181-187 Gibralter Road Horsham, PA 8,269 1982 40 yrs. 104 Rock Road Horsham, PA 6,231 1974 40 yrs. 123-135 Rock Road Horsham, PA 5,493 1975 40 yrs. 111-159 Gibralter Road Horsham, PA 9,188 1981 40 yrs. 161-175 Gibralter Road Horsham, PA 6,799 1976 40 yrs. 125-137 Gibralter Road Horsham, PA 6,016 1978 40 yrs. 261-283 Gibralter Road Horsham, PA 9,297 1978 40 yrs. 210-223 Witmer Road Horsham, PA 5,172 1972 40 yrs. 231-237 Gibralter Road Horsham, PA 9,524 1981 40 yrs. 100 Gibralter Road Horsham, PA 728 1975 40 yrs. 101 Gibralter Road Horsham, PA 12,249 1977 40 yrs. 506 Prudential Road Horsham, PA 1,863 1973 40 yrs. 113-123 Rock Road Horsham, PA 23 1975 40 yrs. 62 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE - Continued 101-111 Rock Road Horsham, PA 6,586 1975 40 yrs. 120 Gibralter Road Horsham, PA 10,627 1980 40 yrs. 110 Gibralter Road Horsham, PA 10,766 1979 40 yrs. 100-107 Lakeside Drive Horsham, PA 4,500 1982 40 yrs. 200-264 Lakeside Drive Horsham, PA 10,917 1982 40 yrs. 300-309 Lakeside Drive Horsham, PA 6,806 1982 40 yrs. 400-445 Lakeside Drive Horsham, PA 10,213 1981 40 yrs. 201 Gibralter Road Horsham, PA 10,262 1983 40 yrs. 3600 Horizon Drive King of Prussia, PA 4,568 1989 40 yrs. 3602 Horizon Drive King of Prussia, PA 3,048 1989 40 yrs. 400-500 Brandywine Parkway West Chester, PA 14,292 1988 40 yrs. 600 Brandywine Parkway West Chester, PA 11,234 1988 40 yrs. 14 Lee Boulevard Malvern, PA 1,060,763 1988 40 yrs. 500 Chester Field Parkway Malvern, PA 611,087 1988 40 yrs. 300-400 Chester Field Parkway Malvern, PA 953,654 1988 40 yrs. 1805 Underwood Boulevard Delran, NJ 125,855 1973 40 yrs. 150 Mid-Atlantic Parkway West Deptford, NJ 213,878 1973 40 yrs. 18 Boulden Circle New Castle, DE 715,037 1989 40 yrs. 501 Delran Parkway Delran, NJ 578,788 1988 40 yrs. 600 Delran Parkway Delran, NJ 1,208,318 1988 40 yrs. 1607 Imperial Way West Deptford, NJ 996,321 1973 40 yrs. 1 Boulden Circle New Castle, DE 340,173 1986 40 yrs. 31-55 Read's Way New Castle, DE 1,315,111 1986 40 yrs. 3 Boulden Circle New Castle, DE 481,109 1987 40 yrs. 5 Boulden Circle New Castle, DE 738,560 1987 40 yrs. 601 Delran Parkway Delran, NJ 389,016 1988 40 yrs. 51 Haddonfield Road Cherry Hill, NJ 2,358,397 1986 40 yrs. 57 Read's Way New Castle, DE 753,222 1985 40 yrs. 1370 Imperial Way West Deptford, NJ 394,067 1978 40 yrs. 8 Stow Road Marlton, NJ 185,812 1988 40 yrs. 10 Stow Road Marlton, NJ 127,341 1988 40 yrs. 12 Stow Road Marlton, NJ 141,346 1988 40 yrs. 14 Stow Road Marlton, NJ 155,328 1988 40 yrs. 1300 Metropolitan Avenue West Deptford, NJ 163,730 1972 40 yrs. 701A Route 73 South Marlton, NJ 627,663 1987 40 yrs. 701C Route 73 South Marlton, NJ 135,403 1987 40 yrs. 1008 Astoria Boulevard Cherry Hill, NJ 88,409 1973 40 yrs. 1475 Imperial Way West Deptford, NJ 82,047 1976 40 yrs. 3000 Atrium Way Mt. Laurel, NJ 1,202,865 1987 40 yrs. 750 Cardinal Drive Pureland, NJ 263,249 1989 40 yrs. 11000, 15000, 17000 Commerce Parkway Mt. Laurel, NJ 426,070 1985 40 yrs. 12000, 14000 Commerce Parkway Mt. Laurel, NJ 262,191 1985 40 yrs. 16000, 18000 Commerce Parkway Mt. Laurel, NJ 224,760 1985 40 yrs. 406 Lippincott Drive Marlton, NJ 180,919 1990 40 yrs. 234 High Hill Road Bridgeport, NJ 121,489 1987 40 yrs. 231 Lake Drive New Castle, DE 125,036 1997 40 yrs. 100 Arlington Boulevard Bridgeport, NJ 182,513 1996 40 yrs. 100 Berkeley Drive Swedesboro, NJ 103,730 1990 40 yrs. 301 Lippincott Drive Marlton, NJ 300,240 1988 40 yrs. 303 Lippincott Drive Marlton, NJ 306,844 1988 40 yrs. 510-512 Sharptown Road Bridgeport, NJ 51,547 1984 40 yrs. 901 Route 73 (901 Building) Marlton, NJ 123,231 1985 40 yrs. Four Greentree Center Marlton, NJ 142,332 1988 40 yrs. 512 Sharptown Road Bridgeport, NJ 66,124 1984 40 yrs. 15 Boulden Circle New Castle, DE 21,513 1997 40 yrs. 404 Lippincott Drive Marlton, NJ 18,727 1997 40 yrs. 263 Quigley Blvd New Castle, DE 44,340 1987 40 yrs. 34 Blevins Drive New Castle, DE 48,331 1987 40 yrs. 104 Gaither Drive Mt Laurel, NJ 35,658 1975 40 yrs. 2 Lukens Drive New Castle, DE 38,747 1988 40 yrs. 402 Lippincott Drive Marlton, NJ 35,680 1997 40 yrs. 3000 Lincoln Drive Mt. Laurel, NJ 38,973 1983 40 yrs. 6000 Commerce Parkway Mt. Laurel, NJ 30,988 1985 40 yrs. 7000 Commerce Parkway Mt. Laurel, NJ 33,251 1984 40 yrs. 8000 Commerce Parkway Mt. Laurel, NJ 29,529 1983 40 yrs. 9000 Commerce Parkway Mt. Laurel, NJ 36,656 1983 40 yrs. 1000 Briggs Road Mt. Laurel, NJ 43,768 1986 40 yrs. 1025 Briggs Road Mt. Laurel, NJ 54,644 1987 40 yrs. 2000 Crawford Place Mount Laurel, NJ 23,937 1986 40 yrs. 1351 Metropolitan Avenue Thorofare, NJ 10,748 1986 40 yrs. 650 Grove Road Thorofare, NJ 15,157 1986 40 yrs. 400 Grove Road Thorofare, NJ 8,225 1986 40 yrs. 1655 Valley Center Parkway Bethlehem, PA 186,310 1993 40 yrs. 6560 Stonegate Drive Allentown, PA 472,580 1989 40 yrs. 6370 Hedgewood Drive Allentown, PA 471,598 1990 40 yrs. 6390 Hedgewood Drive Allentown, PA 535,191 1990 40 yrs. 1495 Valley Center Parkway Bethlehem, PA 616,022 1990 40 yrs. 6350 Hedgewood Drive Allentown, PA 617,892 1989 40 yrs. 6330 Hedgewood Drive Allentown, PA 1,079,504 1988 40 yrs. 1550 Valley Center Parkway Bethlehem, PA 587,742 1988 40 yrs. 1560 Valley Center Parkway Bethlehem, PA 747,669 1988 40 yrs. 6580 Snowdrift Road Allentown, PA 571,101 1988 40 yrs. 1510 Valley Center Parkway Bethlehem, PA 690,231 1988 40 yrs. 1530 Valley Center Parkway Bethlehem, PA 550,025 1988 40 yrs. 6540 Stonegate Drive Allentown, PA 793,806 1988 40 yrs. 974 Marcon Boulevard Allentown, PA 542,462 1987 40 yrs. 964 Marcon Street Allentown, PA 461,528 1985 40 yrs. 764 Roble Road Allentown, PA 228,454 1985 40 yrs. 3174 Airport Road Allentown, PA 415,890 1979 40 yrs. 2196 Avenue C Allentown, PA 407,962 1980 40 yrs. 2202 Hanger Place Allentown, PA 480,198 1981 40 yrs. 2201 Hanger Place Allentown, PA 505,872 1987 40 yrs. 954 Marcon Boulevard Allentown, PA 327,217 1981 40 yrs. 57 South Commerce Way Allentown, PA 252,495 1986 40 yrs. 754 Roble Road Allentown, PA 163,612 1986 40 yrs. 63 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE - Continued 894 Marcon Boulevard Allentown, PA 94,747 1986 40 yrs. 744 Roble Road Allentown, PA 176,344 1986 40 yrs. 944 Marcon Boulevard Allentown, PA 151,226 1986 40 yrs. 1685 Valley Center Parkway Allentown, PA 128,571 1996 40 yrs. 6520 Stonegate Drive Allentown, PA 56,527 1996 40 yrs. 7437 Industrial Boulevard Allentown, PA 550,109 1976 40 yrs. 939 Marcon Blvd Allentown, PA 326,256 1980 40 yrs. 1455 Valley Center Parkway Bethlehem, PA 132,683 1997 40 yrs. 1640 Valley Center Parkway Bethlehem, PA 138,901 1996 40 yrs. 1650 Valley Center Parkway Allentown, PA 108,839 1997 40 yrs. Nestle Way Allentown, PA 652,413 1997 40 yrs. 83 South Commerce Way Bethlehem, PA 39,219 1989 40 yrs. 85 South Commerce Way Bethlehem, PA 39,745 1989 40 yrs. 87 South Commerce Way Bethlehem, PA 41,830 1989 40 yrs. 7339 Industrial Blvd Allentown, PA 437,090 1988 40 yrs. 95 Highland Avenue Bethlehem, PA 63,829 1985 40 yrs. 236 Brodhead Road Bethlehem, PA 88,243 1994 40 yrs. 6620 Grant Way Allentown, PA 31,945 1989 40 yrs. 7562 Penn Drive Allentown, PA - 1989 40 yrs. 7277 Williams Avenue Allentown, PA - 1989 40 yrs. 2041 Avenue C Allentown, PA 79,240 1990 40 yrs. 2124 Avenue C Allentown, PA 74,159 1990 40 yrs. 7339 Industrial Boulevard Allentown, PA 152,891 1996 40 yrs. 7384 Penn Drive Allentown, PA 171,693 1988 40 yrs. 7144 Daniels Drive Allentown, PA 332,264 1975 40 yrs. 7620 Cetronia Road Allentown, PA 244,123 1990 40 yrs. 100 Brodhead Road Allentown, PA 170,356 1990 40 yrs. 12000,001,040 Indian Creek Court Beltsville, MD 2,379,638 1986 40 yrs. 8280 Patuxent Range Drive Columbia, MD 538,879 1978 40 yrs. 7178-80 Columbia Gateway Columbia, MD 404,731 1987 40 yrs. 8730 Bollman Place Columbia, MD 325,182 1984 40 yrs. 9770 Patuxent Woods Drive Columbia, MD 50,860 1986 40 yrs. 9780 Patuxent Woods Drive Columbia, MD 32,515 1986 40 yrs. 9790 Patuxent Woods Drive Columbia, MD 36,271 1986 40 yrs. 9810 Patuxent Woods Drive Columbia, MD 39,705 1986 40 yrs. 9800 Patuxent Woods Drive Columbia, MD 44,500 1988 40 yrs. 9820 Patuxent Woods Drive Columbia, MD 35,377 1988 40 yrs. 9830 Patuxent Woods Drive Columbia, MD 44,078 1986 40 yrs. 9050 Red Branch Road Columbia, MD 32,451 1972 40 yrs. 180,190 Cochrane Drive Annapolis, MD 3,116,559 1989 40 yrs. 9101,9111,9115 Guilford Road Columbia, MD 884,484 1984 40 yrs. 9125,9135,9145 Guilford Road Columbia, MD 1,441,850 1983 40 yrs. 1751 Bluehills Drive Roanoke, VA 585,871 1991 40 yrs. 3432 Holland Road Virginia Beach, VA 55,974 1989 40 yrs. 5162 Valleypointe Parkway Roanoke, VA 182,671 1993 40 yrs. 9601 Cosner Drive Fredericksburg, VA 264,939 1995 40 yrs. 315 Cardiff Valley Road Knoxville, TN 215,809 1994 40 yrs. 1347 Diamond Springs Road Virginia Beach, VA 227,173 1980 40 yrs. 5601-5659 Eastport Boulevard Richmond, VA 313,389 1996 40 yrs. 5900 Eastport Boulevard Richmond, VA 102,426 1997 40 yrs. 4717-4729 Eubank Road Richmond, VA 188,346 1978 40 yrs. 5251 Concourse Drive Roanoke, VA 76,296 1997 40 yrs. 4263F-N. Carolina Ave Richmond, VA 61,255 1975 40 yrs. 4200 Oakleys Court Richmond, VA 78,062 1990 40 yrs. 1821 Battery Dantzler Road Chester, VA 94,958 1990 40 yrs. 5000 Cox Road Glen Allen, VA 116,246 1990 40 yrs. 510 Eastpark Court Sandston, VA 67,809 1989 40 yrs. 520 Eastpark Court Sandston, VA 129,139 1989 40 yrs. 600 Liberty Way Chesterfield, VA 72,183 1997 40 yrs. 500 Liberty Way Chester, VA 17,354 1997 40 yrs. 4198 Cox Road Glen Allen, VA 39,736 1984 40 yrs. 4510 Cox Road Glen Allen, VA 63,266 1990 40 yrs. 2809 South Lynnhaven Road Virginia Beach, VA - 1987 40 yrs. 200 Golden Oak Court Virginia Beach, VA - 1988 40 yrs. 208 Golden Oak Court Virginia Beach, VA - 1989 40 yrs. 1 Enterprise Parkway Hampton, VA - 1987 40 yrs. 22 Enterprise Parkway Hampton, VA - 1990 40 yrs. 10 South Third Street Richmond, VA 10,765 1930 40 yrs. 4300 Carolina Avenue Richmond, VA 1,059,655 1985 40 yrs. 301 Hill Carter Parkway Richmond, VA 342,413 1989 40 yrs. 4001 Carolina Avenue Richmond, VA 19,694 1935 40 yrs. 5600-5626 Eastport Boulevard Richmond, VA 273,614 1989 40 yrs. 5650-5674 Eastport Boulevard Richmond, VA 315,412 1990 40 yrs. 5700 Eastport Boulevard Richmond, VA 197,975 1990 40 yrs. 11020 Hull Street Road Richmond, VA 45,126 1987 40 yrs. 3001 Hungary Springs Road Richmond, VA 43,201 1984 40 yrs. 7760 Shrader Road Richmond, VA 55,899 1987 40 yrs. 7740 Shrader Road Richmond, VA 33,409 1989 40 yrs. 4880 Cox Road Richmond, VA 154,055 1995 40 yrs. 4101- 4127 Carolina Avenue Richmond, VA 161,574 1973 40 yrs. 4201-4261 Carolina Avenue Richmond, VA 364,722 1975 40 yrs. 4263-4299 Carolina Avenue Richmond, VA 185,656 1976 40 yrs. 4301-4335 Carolina Avenue Richmond, VA 118,526 1978 40 yrs. 4337-4379 Carolina Avenue Richmond, VA 176,804 1979 40 yrs. 4501-4549 Carolina Avenue Richmond, VA 253,345 1981 40 yrs. 4551-4593 Carolina Avenue Richmond, VA 261,401 1982 40 yrs. 4601-4643 Carolina Avenue Richmond, VA 386,893 1985 40 yrs. 4545-4583 Carolina Avenue Richmond, VA 588,974 1985 40 yrs. 4447-4491 Carolina Avenue Richmond, VA 207,280 1987 40 yrs. 4401-4445 Carolina Avenue Richmond, VA 319,560 1988 40 yrs. 12 S. Third Street Richmond, VA 13,196 1900 40 yrs. 2300 East Parham Road Richmond, VA 71,585 1988 40 yrs. 5221 Valleypark Drive - Bldg A Roanoke, VA 134,601 1988 40 yrs. 5228 Valleypointe Parkway - Bldg B Roanoke, VA 62,774 1988 40 yrs. 5238 Valleypark Drive - Bldg C Roanoke, VA 144,089 1989 40 yrs. 64 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE - Continued 4523 Green Point Drive High Point, NC 405,750 1988 40 yrs. 4501 Green Point Drive High Point, NC 393,902 1989 40 yrs. 4500 Green Point Drive High Point, NC 395,570 1989 40 yrs. 2427 Penny Road High Point, NC 1,066,124 1990 40 yrs. 4524 Green Point Drive High Point, NC 394,090 1989 40 yrs. 4328, 4336 Federal Drive High Point, NC 678,380 1995 40 yrs. 200 Centreport Drive Greensboro, NC 300,014 1986 40 yrs. 4000 Piedmont Parkway High Point, NC 249,869 1997 40 yrs. 4380 Federal Drive High Point, NC 75,525 1997 40 yrs. 4388 Federal Drive High Point, NC 15,691 1997 40 yrs. 6532 Judge Adams Road Rock Creek, NC 43,080 1997 40 yrs. 3860 Faber Place N. Charleston, SC 33,038 1995 40 yrs. 4055 Faber Place N. Charleston, SC 83,122 1989 40 yrs. 3820 Faber Place N. Charleston, SC 87,852 1993 40 yrs. 440 Knox Abbott Drive Cayce, SC 61,844 1989 40 yrs. Alcoa Fujikura Facility Duncan, SC 134,986 1984 40 yrs. 1320 Garlington Road Greenville, SC 29,409 1986 40 yrs. 9800 Twin Lakes Parkway Charlotte, NC 35,961 1994 40 yrs. 420 Park Avenue Greenville, SC 72,949 1986 40 yrs. 111 Southchase Blvd. Fountain Inn, SC 76,773 1989 40 yrs. 300 International Blvd. Fountain Inn, SC 10,690 1995 40 yrs. 1208 Eastchester Drive High Point, NC 82,904 1988 40 yrs. One Independence Pointe Greenville, SC 12,677 1982 40 yrs. 55 Beattie Place Greenville, SC 49,204 1986 40 yrs. 75 Beattie Place Greenville, SC 36,534 1987 40 yrs. 4344 Federal Drive High Point, NC 112,594 1996 40 yrs. 202 Centreport Drive Greensboro, NC 306,398 1990 40 yrs. 1730 Stebbins Drive Houston, TX 229,748 1973 40 yrs. 5911-5925 Richard Street Jacksonville, FL 218,632 1977 40 yrs. 8383-8385 Baycenter Road Jacksonville, FL 242,593 1973 40 yrs. 8775 Baypine Road Jacksonville, FL 537,892 1989 40 yrs. 8539 Western Way Jacksonville, FL 750,093 1987 40 yrs. 6255 Lake Gray Boulevard Jacksonville, FL 780,177 1987 40 yrs. 6600-6660 Suemac Place Jacksonville, FL 778,457 1987 40 yrs. 6800-6850 Suemac Place Jacksonville, FL 452,334 1973 40 yrs. 8665,8667,8669 Baypine Road Jacksonville, FL 948,951 1987 40 yrs. 8540 Baycenter Road Jacksonville, FL 436,560 1984 40 yrs. 1200 Gulf Life Drive Jacksonville, FL 4,911,318 1985 40 yrs. 8400 Baymeadows Way Jacksonville, FL 543,713 1987 40 yrs. 8614 Baymeadows Way Jacksonville, FL 292,127 1986 40 yrs. 5941-5975 Richard Street Jacksonville, FL 513,893 1978 40 yrs. 7970 Bayberry Road Jacksonville, FL 372,464 1978 40 yrs. 6000-6030 Bowdendale Avenue Jacksonville, FL 635,300 1979 40 yrs. 7898 Baymeadows Way Jacksonville, FL 718,505 1978 40 yrs. 5977-6607 Richard Street Jacksonville, FL 794,758 1980 40 yrs. 7910 & 7948 Baymeadows Way Jacksonville, FL 927,778 1981 40 yrs. 7954 & 7960 Baymeadows Way Jacksonville, FL 951,026 1982 40 yrs. 8787 Baypine Road Jacksonville, FL 11,876,808 1990 40 yrs. 7077 Bonneval Road Jacksonville, FL 814,405 1988 40 yrs. 4190 Belfort Road Jacksonville, FL 867,906 1986 40 yrs. 8011, 8021, 8031 Phillips Highway Jacksonville, FL 319,060 1987 40 yrs. 11777 Central Highway Jacksonville, FL 304,289 1985 40 yrs. 7016 AC Skinner Parkway Jacksonville, FL 103,229 1996 40 yrs. 7018 AC Skinner Parkway Jacksonville, FL 72,407 1997 40 yrs. 6620 Southpoint Drive Jacksonville, FL 90,902 1984 40 yrs. 7980 Bayberry Road Jacksonville, FL 14,062 1978 40 yrs. 9600 Satellite Boulevard Orlando, FL 16,414 1989 40 yrs. 9700 Satellite Boulevard Orlando, FL 14,507 1989 40 yrs. 1902 Cypress Lake Drive Orlando, FL 20,150 1989 40 yrs. 8250 & 8256 Exchange Place Orlando, FL 15,735 1985 40 yrs. 6600 Southpoint Parkway Jacksonville, FL 25,297 1986 40 yrs. 6700 Southpoint Parkway Jacksonville, FL 19,888 1987 40 yrs. 4801 Executive Park Court - 100 Jacksonville, FL - 1990 40 yrs. 4801 Executive Park Court - 200 Jacksonville, FL - 1990 40 yrs. 4810 Executive Park Court Jacksonville, FL - 1990 40 yrs. 6602 Executive Park Court - 100 Jacksonville, FL - 1993 40 yrs. 6602 Executive Park Court - 200 Jacksonville, FL - 1993 40 yrs. 6631 Executive Park Court - 100 Jacksonville, FL - 1994 40 yrs. 6631 Executive Park Court - 200 Jacksonville, FL - 1994 40 yrs. 4815 Executive Park Court - 100 Jacksonville, FL - 1995 40 yrs. 4815 Executive Park Court - 200 Jacksonville, FL - 1995 40 yrs. 4825 Executive Park Court Jacksonville, FL - 1996 40 yrs. 4820 Executive Park Court Jacksonville, FL - 1997 40 yrs. 10511 & 10611 Satellite Boulevard Orlando, FL - 1985 40 yrs. 1400-1440 Central Florida Parkway Orlando, FL - 1962 40 yrs. 7020 AC Skinner Parkway Jacksonville, FL 125,236 1996 40 yrs. 7040 AC Skinner Parkway Jacksonville, FL 242,670 1996 40 yrs. 4001,4051,4101 Fowler Avenue Tampa, FL 1,011,946 1988 40 yrs. 5501-5502 Pioneer Park Boulevard Tampa, FL 148,684 1981 40 yrs. 8401-8408 Benjamin Road Tampa, FL 237,574 1986 40 yrs. 3501 Riga Blvd Tampa, FL 108,127 1983 40 yrs. 111 Kelsey Land Tampa, FL 56,054 1990 40 yrs. 7930, 8010-20 Woodland Center Tampa, FL 87,883 1990 40 yrs. 7920 Woodland Center Boulevard Tampa, FL 53,907 1997 40 yrs. 8154-8198 Woodland Center Tampa, FL 49,611 1988 40 yrs. 8112-42 Woodland Center Tampa, FL 54,108 1995 40 yrs. 8212 Woodland Center Tampa, FL 37,784 1996 40 yrs. 5690-5694 Crenshaw Street Tampa, FL 136,823 1979 40 yrs. 3102,3104,3110 Cherry Palm Drive Tampa, FL 183,217 1986 40 yrs. 1701 Clint Moore Blvd Boca Raton, FL 38,349 1985 40 yrs. 4555 Riverside Drive Beach Gardens, FL 48,602 1988 40 yrs. 2500 Metrocentre Boulevard West Palm Beach, FL 12,881 1988 40 yrs. 2540 Metrocenter Boulevard West Palm Beach, FL 8,881 1988 40 yrs. 2541 Metrocentre Boulevard West Palm Beach, FL 7,843 1988 40 yrs. 2580 Metrocentre Boulevard West Palm Beach, FL 13,861 1988 40 yrs. 65 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE - Continued 2581 Metrocentre Boulevard West Palm Beach, FL 10,230 1988 40 yrs. 5410 - 5430 Northwest 33rd Avenue Ft. Lauderdale, FL 8,775 1985 40 yrs. 2905 Northwest Boulevard Plymouth, MN 88,329 1983 40 yrs. 2800 Campus Drive Plymouth, MN 68,542 1985 40 yrs. 2955 Xenium Lane Plymouth, MN 25,845 1985 40 yrs. 9401-9443 Science Center Drive New Hope, MN 77,757 1989 40 yrs. 6321-6325 Bury Drive Eden Prairie, MN 78,526 1988 40 yrs. 7115-7173 Shady Oak Road Eden Prairie, MN 80,284 1984 40 yrs. 7660-7716 Golden Triangle Drive Eden Prairie, MN 96,534 1988 40 yrs. 7400 Flying Cloud Drive Eden Prairie, MN 33,252 1987 40 yrs. 330 Second Avenue Minneapolis, MN 384,739 1980 40 yrs. 10301-10305 West 70th Street Eden Prairie, MN 20,527 1984 40 yrs. 10321 West 70th Street Eden Prairie, MN 24,718 1984 40 yrs. 10333 West 70th Street Eden Prairie, MN 18,871 1984 40 yrs. 10349-10357 West 70th Street Eden Prairie, MN 48,451 1985 40 yrs. 10365-10375 West 70th Street Eden Prairie, MN 49,468 1985 40 yrs. 10393-10394 West 70th Street Eden Prairie, MN 47,384 1985 40 yrs. 7078 Shady Oak Road Eden Prairie, MN 58,307 1985 40 yrs. 5600 & 5610 Rowland Road Minnetonka, MN 77,949 1988 40 yrs. 2920 Northwest Boulevard Plymouth, MN 7,138 1997 40 yrs. 26911-26957 Northwestern Southfield, MI 1,423,867 1985 40 yrs. 1650 Research Drive Troy, MI 89,558 1985 40 yrs. 1775 Research Drive Troy, MI 35,636 1985 40 yrs. 1875 Research Drive Troy, MI 35,277 1986 40 yrs. 1850 Research Drive Troy, MI 91,625 1986 40 yrs. 1965 Research Drive Troy, MI 45,310 1987 40 yrs. 1960 Research Drive Troy, MI 45,312 1987 40 yrs. 27260 Haggerty Road Farmington Hill, MI 51,625 1983 40 yrs. 27200 Haggerty Road Farmington Hill, MI 43,158 1983 40 yrs. 27280 Haggerty Road Farmington Hill, MI 42,690 1983 40 yrs. 27220 Haggerty Road Farmington Hill, MI 22,759 1985 40 yrs. 27240 Haggerty Road Farmington Hill, MI 19,178 1985 40 yrs. 27300 Haggerty Road Farmington Hill, MI 41,819 1985 40 yrs. 1101 Allen Drive Troy, MI 5,566 1974 40 yrs. 1151 Allen Drive Troy, MI 9,329 1974 40 yrs. 1300 Rankin Street Troy, MI 7,605 1979 40 yrs. 1350 Rankin Street Troy, MI 6,339 1979 40 yrs. 1376-1400 Rankin Street Troy, MI 7,617 1979 40 yrs. 1352-1374 Rankin Street Troy, MI 8,693 1979 40 yrs. 1324-1346 Rankin Street Troy, MI 7,605 1979 40 yrs. 1301-1307 Rankin Street Troy, MI 6,339 1978 40 yrs. 1409 Allen Drive Troy, MI 8,075 1978 40 yrs. 1304 E Maple Road Troy, MI 11,980 1971 40 yrs. 1334 Maplelawn Road Troy, MI 7,050 1983 40 yrs. 1290 Maplelawn Road Troy, MI 4,839 1984 40 yrs. 1070 Maplelawn Road Troy, MI 3,888 1982 40 yrs. 950 Maplelawn Road Troy, MI 14,317 1982 40 yrs. 894 Maplelawn Road Troy, MI 10,308 1986 40 yrs. 1179 Maplelawn Road Troy, MI 4,982 1984 40 yrs. 1940 Norwood Drive Troy, MI 4,925 1983 40 yrs. 1311-1331 Maplelawn Road Troy, MI 7,113 1986 40 yrs. 2354 Bellingham Street Troy, MI 4,954 1990 40 yrs. 2360 Bellingham Street Troy, MI 4,954 1985 40 yrs. 1911 Ring Drive Troy, MI 4,885 1986 40 yrs. 26442-26450 Haggerty Road Farmington Hill, MI 13,482 1988 40 yrs. 26500 Haggerty Road Farmington Hill, MI 17,645 1986 40 yrs. 26650 Haggerty Road Farmington Hill, MI 9,822 1988 40 yrs. 26700 Haggerty Road Farmington Hill, MI 14,369 1986 40 yrs. 26750 Haggerty Road Farmington Hill, MI 16,603 1988 40 yrs. 26800 Haggerty Road Farmington Hill, MI 9,954 1986 40 yrs. 26842-26850 Haggerty Road Farmington Hill, MI 13,590 1988 40 yrs. 50 Gibson Drive West Malling, UK 357,685 1996 40 yrs. 25 Kings Hill Avenue West Malling, UK 218,828 1996 40 yrs. 2 Kings Hill Avenue West Malling, UK 136,412 1996 40 yrs. 50 Kings Hill Avenue West Malling, UK 298,587 1996 40 yrs. ------------- Subtotal Operating Real Estate $ 149,310,861 ============= DEVELOPMENT PROPERTIES 132 Welsh Road Horsham, PA $ - 1997 N/A 3604 Horizon Blvd King of Prussia, PA - 1997 N/A 100 Cedar Hollow Road Malvern, PA - 1997 N/A 3 Country View Road Malvern, PA - 1997 N/A 425 Technology Drive Malvern, PA - 1997 N/A 375 Technology Drive Malvern, PA - 1997 N/A 100 Chesterfield Pkwy Malvern, PA - 1997 N/A 201 Berkeley Drive Bridgeport, NJ - 1997 N/A 300 Commodore Drive Bridgeport, NJ - 1997 N/A 1660 Valley Center Parkway Bethlehem, PA - 1996 N/A 89 South Commerce Way Bethlehem, PA - 1997 N/A 1525 Valley Ctr Pkwy Allentown, PA - 1997 N/A 700 Nestle Way Allentown, PA - 1997 N/A 5500 Cox Road Richmond, VA - 1997 N/A 13001 Kingston Ave Richmond, VA - 1997 N/A 5701-5799 Eastport Blvd Richmond, VA - 1996 N/A 4801 Cox Road Richmond, VA - 1997 N/A 701 Liberty Way Richmond, VA - 1997 N/A 5310 Valley Park Drive Roanoke, VA - 1997 N/A 5305 Valley Park Drive Roanoke, VA - 1997 N/A 530 Eastpark Court Sandston, VA - 1997 N/A 101 Centreport Greensboro, NC - 1996 N/A 6532 Judge Adams Road Whitsett, NC - 1997 N/A 3875 Faber Place N. Charleston, SC - 1997 N/A 1 Alliance Drive Goose Creek, SC - 1997 N/A 66 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ DEVELOPMENT PROPERTIES - Continued 1150 Northpoint Blvd Blythwood, SC - 1997 N/A 4160 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4194 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4196 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4170 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4180 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 7720 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4345 Southpoint Parkway Jacksonville, FL - 1996 N/A 131 Silo Bend Tampa, FL - 1996 N/A 7724 Woodland Ctr Blvd Tampa, FL - 1997 N/A 7802-50 Woodland Ctr Blvd Tampa, FL - 1997 N/A 7852-98 Woodland Ctr Blvd Tampa, FL - 1997 N/A 8921 Brittany Way Tampa, FL - 1997 N/A 6601-6625 W. 78th Street Bloomington, MN - 1997 N/A 10400 Southwest Crossing Eden Prairie, MN - 1997 N/A 10 Kings Hill Ave West Malling, UK - 1997 N/A 30 Tower View West Malling, UK - 1997 N/A 35 Kings Hill Ave West Malling, UK - 1997 N/A ------------- Subtotal Development in Progress $ - ============= LAND HELD FOR DEVELOPMENT Chelsea Business Park Land Boothwyn, PA $ - 1988 N/A Gwynedd North Bus Camp Land Lansdale, PA - 1989 N/A Three Country View Road Malvern, PA - 1995 N/A 550 Lapp Road Malvern, PA - 1995 N/A Cedar Hollow Road Land Malvern, PA - 1996 N/A Walnut Grove Land Horsham, PA - 1996 N/A Iron Run Land Upper Macungie, PA - 1997 N/A 35 Liberty Blvd Land Malvern, PA - 1997 N/A 45 Liberty Blvd Land Malvern, PA - 1997 N/A Great Valley Land Malvern, PA - 1997 N/A 10 Matthews Rd South Land Malvern, PA - 1997 N/A 104 Witmer Road Horsham, PA - 1997 N/A 3 Franklin Plaza Philadelphia, PA - 1997 N/A 2700 Horizon Dr King of Prussia, PA - 1997 N/A 2900 Horizon Dr King of Prussia, PA - 1997 N/A 2500 Renaissance Blvd King of Prussia, PA - 1997 N/A 2300 Renaissance Blvd King of Prussia, PA - 1997 N/A Swedes Run Business Park Land Delran, NJ - 1992 N/A Marlton Crossing Land Marlton, NJ - 1994 N/A Commodore Business Park Logan Twp., NJ - 1995 N/A Boulden Land New Castle, DE - 1995 N/A Marlton Executive Park Land Marlton, NJ - 1994 N/A 17 Boulden Circle New Castle, DE - 1996 N/A 1015 Briggs Road Land Mt. Laurel, NJ - 1997 N/A 1020 Briggs Road Land Mt. Laurel, NJ - 1997 N/A Lehigh Valley Corporate Center Land Bethlehem, PA - 1987 N/A Park at Valleypointe Land Roanoke, VA - 1995 N/A Fairgrounds Distribution Center Land Richmond, VA - 1995 N/A Rivers' Bend Land Chesterfield City, VA - 1995 N/A Oakleys Center Land Richmond, VA - 1996 N/A Woodlands Center Land Sandston, VA - 1996 N/A 501 Liberty Way Chesterfield City, VA - 1996 N/A 601 Hewlett Packard Way Chesterfield City, VA - 1997 N/A 6000-98 Eastport Blvd Richmond, VA - 1997 N/A Eastport VIII Richmond, VA - 1997 N/A Eastport IX Richmond, VA - 1997 N/A Mendenhall Land High Point, NC - 1995 N/A Independence Pointe Land Greenville, SC - 1997 N/A Southpoint Business Park Land Jacksonville, FL - 1994 N/A Liberty Business Park Land Jacksonville, FL - 1995 N/A 7024 AC Skinner Parkway Jacksonville, FL - 1995 N/A 7014 AC Skinner Pkwy Jacksonville, FL - 1996 N/A Cypress Park Land Orlando, FL - 1997 N/A Exchange Place Land Orlando, FL - 1997 N/A Airport West Tampa, FL - 1995 N/A Silo Bend Land (LPDC) Tampa, FL - 1996 N/A West Tech Park Land (Lot B) Farmington Hill, MI - 1997 N/A West Tech Park Land (Lot C) Farmington Hill, MI - 1997 N/A ------------- Subtotal Land Held for Development $ - ============= Total All Properties $ 149,310,861 ============= * Denotes property is collateralized under mortgages with Nationwide, Principal Mutual, American General and Jackson National Life totalling $246.2 million. ** Rouse leases land from Kent County Council.
67 SCHEDULE III LIBERTY PROPERTY TRUST REAL ESTATE AND ACCUMULATED DEPRECIATION (In thousands) A summary of activity for real estate and accumulated depreciation is as follows: FOR THE YEARS ENDED DECEMBER 31, -------------------------------- 1997 1996 1995 --------- ---------- --------- REAL ESTATE: Balance at beginning of year $1,178,713 $ 920,230 $ 586,789 Additions 960,548 268,066 333,441 Disposition of property (42,924) (9,583) -- ---------- ---------- --------- Balance at end of year $2,096,337 $1,178,713 $ 920,230 ========== ========== ========= ACCUMULATED DEPRECIATION: Balance at beginning of year $ 119,151 $ 94,183 $ 74,508 Depreciation expense 35,981 24,968 19,675 Disposition of property (5,821) - - ---------- ---------- --------- Balance at end of year $ 149,311 $ 119,151 $ 94,183 ========== ========== ========= 68 REPORT OF INDEPENDENT AUDITORS To The Partners Liberty Property Limited Partnership We have audited the accompanying consolidated balance sheets of Liberty Property Limited Partnership ("the Operating Partnership") as of December 31, 1997, and 1996 , and the related consolidated statements of operations, owners' equity, and cash flows for each of the three years in the period ended December 31, 1997. Our audits also included the financial statement schedule listed in the Index at Item 14(a). These financial statements and schedule are the responsibility of the Operating Partnership's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Liberty Property Limited Partnership at December 31, 1997 and 1996, the consolidated results of Liberty Property Limited Partnership's operations and cash flows for each of the three years in the period ended December 31, 1997, in conformity with generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein. /s/ ERNST & YOUNG LLP Philadelphia, Pennsylvania ERNST & YOUNG LLP February 13, 1998, except for Note 10, as to which the date is February 23, 1998 69 CONSOLIDATED BALANCE SHEETS OF LIBERTY PROPERTY LIMITED PARTNERSHIP (IN THOUSANDS) DECEMBER 31, ------------------------- 1997 1996 ---------- ----------- ASSETS Real estate: Land and land improvements $ 238,519 $ 140,196 Buildings and improvements 1,639,821 908,835 Less accumulated depreciation (149,311) (119,151) ---------- ---------- Operating real estate 1,729,029 929,880 Development in progress 156,093 85,628 Land held for development 61,904 44,054 ---------- ---------- Net real estate 1,947,026 1,059,562 Cash and cash equivalents 55,079 19,612 Accounts receivable 6,517 7,007 Deferred financing and leasing costs, net of accumulated amortization (1997, $40,560; 1996, $30,985) 32,536 27,013 Prepaid expenses and other assets 53,179 39,418 ---------- ---------- Total assets $2,094,337 $1,152,612 ========== ========== LIABILITIES Mortgage loans $ 363,591 $ 240,803 Unsecured notes 350,000 - Lines of credit 135,000 266,692 Convertible debentures 111,543 171,214 Accounts payable 14,544 6,294 Accrued interest 10,960 7,411 Dividend payable 25,927 14,248 Other liabilities 42,499 28,923 ---------- ---------- Total liabilities 1,054,064 735,585 OWNERS' EQUITY General partner's equity 955,595 375,532 Limited partners' equity 84,678 41,495 ---------- ---------- Total owners' equity 1,040,273 417,027 ---------- ---------- Total liabilities and owners' equity $2,094,337 $1,152,612 ========== ========== See accompanying notes. 70
CONSOLIDATED STATEMENTS OF OPERATIONS OF LIBERTY PROPERTY LIMITED PARTNERSHIP (IN THOUSANDS) YEAR ENDED DECEMBER 31, ------------------------------------------ 1997 1996 1995 ------------ ------------ ------------ REVENUE Rental $ 169,859 $ 112,841 $ 89,163 Operating expense reimbursement 55,502 35,886 24,604 Management fees 673 1,340 734 Interest and other 6,483 4,198 2,540 ------------ ----------- ----------- Total revenue 232,517 154,265 117,041 OPERATING EXPENSES Rental property 43,118 29,624 20,010 Real estate taxes 17,961 11,229 9,304 General and administrative 10,650 8,023 5,212 Depreciation and amortization 40,752 28,203 22,518 ------------ ----------- ----------- Total operating expenses 112,481 77,079 57,044 ------------ ----------- ----------- Operating income 120,036 77,186 59,997 Premium on debenture conversions 98 1,027 - Interest expense 53,888 38,528 37,688 ------------ ----------- ----------- Net income $ 66,050 $ 37,631 $ 22,309 ============ =========== =========== Net income allocated to general partner $ 60,444 $ 33,740 $ 19,466 ============ =========== =========== Net income allocated to limited partners $ 5,606 $ 3,891 $ 2,843 ============ =========== ===========
See accompanying notes. 71
CONSOLIDATED STATEMENTS OF OWNERS' EQUITY OF LIBERTY PROPERTY LIMITED PARTNERSHIP (IN THOUSANDS) GENERAL LIMITED PARTNER'S PARTNERS' TOTAL OWNERS' EQUITY EQUITY EQUITY ---------- ---------- ------------- Owners' equity at January 1, 1995 $ 229,667 $ 29,832 $ 259,499 Contribution from partners 131,558 - 131,558 Distribution to partners (45,170) (6,279) (51,449) Issuance of Operating Partnership Units - 14,757 14,757 Net income 19,466 2,843 22,309 ---------- ----------- ------------ Balance at December 31, 1995 335,521 41,153 376,674 Contribution from partners 55,001 1,878 56,879 Distribution to partners (48,730) (5,427) (54,157) Net income 33,740 3,891 37,631 ---------- ----------- ------------ Balance at December 31, 1996 375,532 41,495 417,027 Contribution from partners 597,395 15,982 613,377 Distribution to partners (77,776) (7,197) (84,973) Issuance of Operating Partnership Units - 28,792 28,792 Net income 60,444 5,606 66,050 ---------- ----------- ------------ Balance at December 31, 1997 $ 955,595 $ 84,678 $ 1,040,273 ========== =========== ============
See accompanying notes. 72
CONSOLIDATED STATEMENTS OF CASH FLOWS OF LIBERTY PROPERTY LIMITED PARTNERSHIP (IN THOUSANDS) YEAR ENDED DECEMBER 31, ---------------------------------------- 1997 1996 1995 ------------ ------------ ------------ OPERATING ACTIVITIES Net income $ 66,050 $ 37,631 $ 22,309 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 40,752 28,203 22,518 Amortization of deferred financing costs 7,367 4,561 4,869 Gain on sale (2,518) (577) - Noncash compensation 423 704 - Changes in operating assets and liabilities: Accounts receivable 490 (1,399) (1,006) Prepaid expenses and other assets (11,881) (12,897) (5,595) Accounts payable 8,250 1,717 2,871 Accrued interest 3,549 (2,028) (286) Other liabilities 14,378 8,463 9,641 ------------ ------------ ------------ Net cash provided by operating activities 126,860 64,378 55,321 ------------ ------------ ------------ INVESTING ACTIVITIES Investment in properties (655,744) (115,971) (193,219) Proceeds from disposition of properties 33,958 - - Investment in development in progress (206,593) (126,392) (64,122) Increase in land held for development (17,850) (15,476) (20,367) Increase in deferred leasing costs (8,642) (7,588) (4,154) ------------ ------------ ------------ Net cash used in investing activities (854,871) (265,427) (281,862) ------------ ------------ ------------ FINANCING ACTIVITIES Proceeds from issuance of unsecured notes 350,000 - - Proceeds from mortgage loans 124,815 77,605 91,800 Repayments of mortgage loans (50,340) (8,917) (7,659) Proceeds from lines of credit 776,017 237,191 167,925 Repayments on lines of credit (907,709) (42,393) (140,031) Deposits on pending acquisitions 45 2,593 12,865 Increase in deferred financing costs (10,941) (3,469) (5,576) Capital contributions 554,886 - 131,458 Distribution to partners (73,295) (52,578) (38,781) ------------ ------------ ------------ Net cash provided by financing activities 763,478 210,032 212,001 Increase (decrease) in cash and cash equivalents 35,467 8,983 (14,540) Cash and cash equivalents at beginning of year 19,612 10,629 25,169 ------------ ------------ ------------ Cash and cash equivalents at end of year $ 55,079 $ 19,612 $ 10,629 ============ =========== =========== SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS Write-off of fully depreciated property and deferred costs $ 7,892 $ 487 $ 2,617 Acquisition of properties (77,105) - (55,874) Assumption of mortgage loans 48,313 - 41,117 Issuance of operating partnership units 28,792 - 14,757 Noncash compensation 802 370 - Conversion of convertible debenture 57,266 55,805 100 ============ ============ ============
See accompanying notes. 73 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF LIBERTY PROPERTY LIMITED PARTNERSHIP 1. ORGANIZATION Liberty Property Trust (the "Trust") is a self-administered and self- managed Maryland real estate investment trust (a "REIT"). Substantially all of the Trust's assets are owned directly or indirectly, and substantially all of the Trust's operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the "Operating Partnership" and, together with the Trust, the "Company"). At December 31, 1997, the Trust owned a 91.84% interest in the Operating Partnership as the sole general partner and a 0.02% interest as a limited partner. The Company provides leasing, property management, acquisition, development, construction management, and design management for a portfolio of industrial and office properties which are located principally within the Southeastern, Mid-Atlantic and Mid-Western United States. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Principles of Consolidation The Consolidated Financial Statements of the Company include the accounts of the Operating Partnership and the Operating Partnership's direct and indirect subsidiaries including Liberty Property Development Corporation. All significant intercompany transactions and accounts have been eliminated. Certain amounts from prior periods have been restated to conform to current year presentation. Real Estate and Depreciation The Properties are recorded at the lower of cost or fair value and are depreciated using the straight-line method over their estimated useful lives. The estimated lives are as follows: Building and improvements 40 years Equipment 10 years Tenant improvements Term of the related lease Expenditures directly related to acquisition, development or improvement of real estate are capitalized as a cost of the property. Expenditures for maintenance and repairs are charged to operations as incurred. Cash and Cash Equivalents Highly liquid investments with a maturity of three months or less when purchased are classified as cash equivalents. The carrying amount of these assets approximates their fair market value. 74 Revenues The Company earns rental income under operating leases with tenants. Rental income is recognized on a straight-line basis over the applicable lease term. Deferred Financing and Leasing Costs Costs incurred in connection with financing or leasing are capitalized and amortized over the term of the related loan or lease. Amortization of deferred financing costs is reported as interest expense. Income Taxes In conformity with the Internal Revenue Code and applicable state and local tax statutes, taxable income or loss of the Operating Partnership is required to be reported in the tax returns of the partners in accordance with the terms of the Partnership Agreement and, accordingly, no provision has been made in the accompanying financial statements for any federal, state, or local income taxes. 3. REAL ESTATE At December 31, 1997 and 1996, the Company owned and operated industrial and office properties located principally in suburban mixed use developments or business parks. The carrying value of these properties by type is as follows (in thousands):
LAND BUILDINGS AND LAND AND ACCUMULATED IMPROVEMENTS IMPROVEMENTS TOTAL DEPRECIATION ------------ ------------ ----------- ------------ 1997: Industrial properties $ 140,793 $ 873,937 $1,014,730 $ 81,774 Office properties 97,726 765,884 863,610 67,537 ------------ ----------- ----------- ------------ 1997 Total $ 238,519 $1,639,821 $1,878,340 $ 149,311 ============ =========== =========== ============ 1996: Industrial properties $ 85,459 $ 517,272 $ 602,731 $ 62,557 Office properties 54,737 391,563 446,300 56,594 ------------ ----------- ----------- ------------ 1996 Total $ 140,196 $ 908,835 $1,049,031 $ 119,151 ============ =========== =========== ============
Depreciation expense was $36.0 million in 1997,$25.0 million in 1996 and $19.7 million in 1995. As of December 31, 1997 the Company has commenced development on 43 properties, which upon completion are expected to comprise approximately 4.1 million square feet of leaseable space. As of December 31, 1997 approximately $156.1 million has been expended for the development of these projects and an additional $148.8 million is required for completion. 4. RELATED PARTY TRANSACTIONS An affiliated company provides construction services to the Company. 75 Amounts paid to this affiliate were $8.2 million in 1997, $29.7 million in 1996 and $6.2 million in 1995. During 1995, three properties were purchased from partnerships in which officers of the Company had an interest. The officers received no financial consideration for the purchase. Pursuant to agreements, the Company has been retained by an affiliate (Rouse Kent Limited) to provide development, management and other services. For the years ended December 31, 1997, 1996 and 1995, the fees for these services were $600,000 per year. Additionally, the Company committed to loans in 1996 to two affiliates (Rouse Kent Development Limited and 1 Tower View Limited) for development projects. At December 31, 1997, only one (1 Tower View Limited) of these loans, with a balance of $5.5 million, remained outstanding. As of December 31, 1996, the balance of these loans was $7.4 million. 5. MORTGAGE LOANS, UNSECURED NOTES, LINES OF CREDIT, AND CONVERTIBLE DEBENTURES Long term indebtedness consists generally of mortgage loans, unsecured notes, lines of credit and convertible debentures. The average annualized interest rates for the years ended December 31, 1997, 1996 and 1995, were approximately 7.5%, 7.6% and 7.8%, respectively. Interest expense for the years ended December 31, 1997, 1996 and 1995, aggregated $53.9 million, $38.5 million and $37.7 million, respectively. Interest costs during these periods of $11.8 million, $7.7 million and $3.5 million were capitalized. Cash paid for interest for the years ended December 31, 1997, 1996 and 1995, was $54.9 million, $43.7 million $36.7 million, respectively. Mortgage loans with maturities ranging from 1998 to 2013 are collateralized by and in some instances cross-collateralized by properties with a book value of $493.2 million. The interest rates on $344.4 million of mortgage loans are fixed and range from 6% to 9.13%. Interest rates on $19.2 million of mortgage loans float with Eurodollar or prime and are subject to certain caps. The weighted average interest rate on the mortgage loans is 7.7% and the weighted average remaining term is 8.3 years. The aggregate maturities of the mortgage loans outstanding are as follows (in thousands): 1998 $ 13,443 1999 21,718 2000 32,451 2001 22,700 2002 6,044 Thereafter 267,235 -------- TOTAL $363,591 ======== The unsecured notes are comprised of $350 million principal amount of fixed rate unsecured notes with four maturities which are as follows: $50 million principal amount bears interest at 6.97% and is due 2003, $100 million principal amount bears interest at 7.1% and is due 2004, $100 million principal amount bears interest at 6.95% and is due 2006, and $100 million principal amount bears interest at 7.25% and is due 2007. 76 The line of credit is a $325 million unsecured credit facility (the "Credit Facility") which replaced two existing secured lines of credit aggregating $350 million in May 1997. Coincident with the replacement of the lines of credit, $2.9 million of related deferred financing costs were charged to interest expense. The interest rate on borrowings under the Credit Facility fluctuates, based on the Company's leverage levels and senior debt ratings from Moody's Investors Services, Inc. ("Moody's") and Standard & Poor's Ratings Group ("Standard & Poor's). The current ratings for the Company's senior unsecured debt are Baa3 and BBB- from Moody's and Standard & Poor's respectively. At these ratings, the current interest rate on the Credit Facility is 110 basis points over the Eurodollar Rate (7.09% at December 31, 1997). The rate for both lines of credit at December 31, 1996 was 7.13%. Customary fees apply to the Credit Facility including an annual administrative fee and an unused line fee. The convertible debentures are due on June 23, 2001 and are exchangeable for the common shares of beneficial interest, of the Trust (the "Common Shares") at a rate of one Common Share for each $20 outstanding principal amount of convertible debentures, subject to certain adjustments. The initial interest rate on the convertible debentures was 8% and increases with increases in the dividend payment on the Company's Common Shares. At the current $.42 per share per quarter dividend payment rate, the effective interest rate on the convertible debentures is 8.4%. At December 31, 1996 the effective interest rate on the convertible debentures was 8.2%. During the year ended December 31, 1997, the Company paid sums aggregating $98,000 to facilitate the conversion of $17.3 million of debentures into 862,650 Common Shares. During the year ended December 31, 1997, $2.4 million of deferred financing costs relating to converted debentures were charged to additional paid-in capital. During the year ended December 31, 1996, the Company paid sums aggregating $1.0 million to facilitate the conversion of $58.7 million of convertible debentures into 2,934,300 Common Shares. During the year ended December 31, 1996, $2.9 million of related deferred financing costs were charged to additional paid-in capital. At December 31, 1997 and 1996 the convertible debentures were convertible into 5,577,150 Common Shares and 8,560,700 Common Shares, respectively. The fair value of the convertible debentures at December 31, 1997 was $159.3 million based on the closing bid price of the Common Shares on the New York Stock Exchange. The fair values of the mortgages, unsecured notes and Credit Facility were estimated using discounted cash flow analysis, based on the Company's estimated incremental borrowing rate at December 31, 1997, for similar types of borrowing arrangements. The carrying values of the mortgages, unsecured notes and the Credit Facility approximate their fair values. 6. LEASING ACTIVITY Future minimum rental payments due from tenants under non-cancellable operating leases as of December 31, 1997 are as follows (in thousands): 1998 $ 211,211 1999 186,375 2000 147,201 2001 109,323 2002 85,078 Thereafter 309,527 ---------- TOTAL $1,048,715 ========== 77 In addition to minimum rental payments, tenants pay for their pro rata share of specified operating expenses. These amounts are included as operating expense reimbursement in the accompanying statements of operations. 7. COMMITMENTS AND CONTINGENCIES All of the Properties were subject to Phase I Environmental Assessments ("Phase I Assessments") obtained in contemplation their acquisition by the Company. The Phase I Assessments consisted of, among other activities, a visual inspection of each Property and its neighborhood and a check of pertinent public records. The Phase I Assessments did not reveal, nor is the Company aware of, any non- compliance with environmental laws, environmental liability or other environmental claim that the Company believes would likely have a material adverse effect on the Company. In connection with one of the 1997 acquisitions, the Company is obligated to purchase, over a 10-year period ending in 2007, approximately 800 acres of land for commercial development. The purchase price of the land is $17.5 million, plus accrued interest at 7.5% per annum, payable over 10 years ending in 2007. The Operating Partnership is not a party to any material legal proceedings. In the ordinary course of business, the Operating Partnership is party to routine litigation incidental to its business and in addition it is covered by insurance. 8. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) The following is a summary of quarterly results of operations for the two years ended December 31, 1997 and 1996 (in thousands):
QUARTER ENDED ---------------------------------------------------------------------------------- DEC. 31, SEPT. 30, JUNE 30, MARCH 31, DEC. 31, SEPT. 30, JUNE 30, MARCH 31, 1997 1997 1997 1997 1996 1996 1996 1996 -------- --------- -------- --------- -------- --------- -------- --------- Rental revenue $ 50,636 $ 45,241 $ 39,341 $ 34,641 $ 30,822 $ 28,921 $ 27,146 $ 25,952 ======== ======== ======== ======== ======== ========= ======== ========= Operating income 38,467 31,363 26,100 24,106 20,884 19,657 18,557 18,088 ======== ======== ======== ======== ======== ========= ======== ========= Net income 24,750 17,571 12,205 11,524 10,630 9,313 8,734 8,954 ======== ======== ======== ======== ======== ========= ======== ========= Net income allocated to general partner 22,959 15,981 10,955 10,549 9,572 8,370 7,809 7,989 ======== ======== ======== ======== ======== ========= ======== =========
9. PRO FORMA INFORMATION (UNAUDITED) The following unaudited pro forma information has been prepared assuming the 1997 Common and Preferred Shares Offerings and the acquisitions of 33 properties acquired in 1996 and 170 properties 78 acquired in 1997 had occurred at January 1, 1996. The 1996 acquisitions were acquired for a total investment of $132.9 and the 1997 acquisitions were acquired for a total investment of $727.9 million. YEAR ENDED DECEMBER 31, ----------------------- 1997 1996 --------- ---------- (IN THOUSANDS) ----------------------- Total revenues $ 287,203 $ 255,424 Net income 90,543 74,066 This pro forma information is not necessarily indicative of what actual results of operations of the Company would have been, assuming the Company had completed the Common Shares Offering and the Preferred Shares Offerings as of January 1, 1996, nor do they purport to represent the results of operations of the Company for future periods. 10. SUBSEQUENT EVENTS On Jannuary 22, 1998, the Company sold $75.0 million principal amount of 6.375% notes due 2013. Such notes are subject to mandatory repayment of principal to the holders thereof in 2003 pursuant to a call/put option relating to such notes. On January 23, 1998, the Company sold $100.0 million principal amount of 7.50% notes due 2018. The aggregate net proceeds to the Company from such offerings were approximately $173.3 million. On January 21, 1998, the Company consummated a public offering of 2,300,000 Common Shares. The aggregate net proceeds to the Company from such offering were approximately $60.4 million. On February 23, 1998, the Company consummated a public offering of 1,702,128 Common Shares. The aggregate net proceeds to the Company from such offering were approximately $42.7 million. 79 LIBERTY PROPERTY LIMITED PARTNERSHIP REAL ESTATE AND ACCUMULATED DEPRECIATION AS OF DECEMBER 31, 1997
Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE 10,20 Liberty Boulevard Malvern, PA $ - $ 724,058 $ - $ 4,843,344 420 Lapp Road Malvern, PA * 1,054,418 - 6,327,423 1 Chelsea Parkway Boothwyn, PA - 245,082 - 2,611,090 3 Chelsea Parkway Boothwyn, PA - 288,654 - 2,784,590 747 Dresher Road Horsham, PA - 1,607,238 - 3,946,288 45-67 Great Valley Parkway Malvern, PA * 795,143 - 2,846,228 1180 Church Road Lansdale, PA - 2,357,045 10,041,340 4,777,535 40 Valley Stream Parkway Malvern, PA * 322,918 - 2,185,822 50 Valley Stream Parkway Malvern, PA - 323,971 - 2,375,727 20 Valley Stream Parkway Malvern, PA * 465,539 - 5,044,423 800 Town Center Drive Langhorne, PA - 1,617,150 - 8,776,186 1610 Medical Drive Pottstown, PA - 211,639 - 2,499,092 9, 15 Great Valley Parkway Malvern, PA * 1,837,050 - 14,959,932 257-275 Great Valley Parkway Malvern, PA * 504,611 - 4,361,570 300 Technology Drive Malvern, PA - 368,626 - 1,293,647 277-293 Great Valley Parkway Malvern, PA - 530,729 - 1,889,105 311 Technology Drive Malvern, PA - 397,131 - 2,196,846 325 Technology Drive Malvern, PA * 376,444 - 1,851,241 7 Great Valley Parkway Malvern, PA * 176,435 - 4,229,841 55 Valley Stream Parkway Malvern, PA - 215,005 - 3,096,409 65 Valley Stream Parkway Malvern, PA * 381,544 - 4,685,028 508 Lapp Road Malvern, PA * 331,392 - 1,700,134 10 Valley Stream Parkway Malvern, PA * 509,075 - 2,636,397 333 Phoenixville Pike Malvern, PA 2,145,661 523,530 - 3,087,305 1566 Medical Drive Pottstown, PA - 203,083 - 1,844,311 30 Great Valley Parkway Malvern, PA - 128,126 - 355,565 75 Great Valley Parkway Malvern, PA - 143,074 - 418,889 27-43 Great Valley Parkway Malvern, PA * 448,775 - 2,085,060 77-123 Great Valley Parkway Malvern, PA * 887,664 - 4,423,914 260 Great Valley Parkway Malvern, PA * 203,916 - 849,011 256 Great Valley Parkway Malvern, PA * 161,098 - 1,888,761 205 Great Valley Parkway Malvern, PA * 1,368,259 - 9,506,412 12,14,16 Great Valley Parkway Malvern, PA - 130,689 - 1,163,088 155 Great Valley Parkway Malvern, PA * 625,147 - 2,198,481 333 Technology Drive Malvern, PA * 157,249 - 2,310,848 510 Lapp Road Malvern, PA * 356,950 - 865,210 181 Wheeler Court Langhorne, PA - 260,000 1,940,000 106,994 1100 Wheeler Way Langhorne, PA - 150,000 1,100,000 90,717 60 Morehall Road Malvern, PA - 865,424 9,285,000 4,796,385 905 Airport Road West Chester, PA - 1,715,000 5,185,000 202,101 16 Cabot Boulevard Langhorne, PA * 648,889 5,851,112 75,975 1 Country View Road Malvern, PA - 400,000 3,600,000 393,846 2151 Cabot Boulevard Langhorne, PA * 384,100 3,456,900 263,500 170 South Warner Road King of Prussia, PA - 547,800 3,137,400 2,082,785 190 South Warner Road King of Prussia, PA - 552,200 3,162,600 1,182,365 507 Prudential Road Horsham, PA * 644,900 5,804,100 231,047 100 Witmer Road Horsham, PA 9,710,257 3,102,784 - 9,685,337 3100 Horizon Blvd King of Prussia, PA - 601,956 - 2,007,248 3300 Horizon Blvd King of Prussia, PA - 566,403 - 3,261,664 3500 Horizon Blvd King of Prussia, PA - 1,204,839 - 2,529,997 200 Chester Field Parkway Malvern, PA - 495,893 2,739,093 121,305 767 Electronic Drive Horsham, PA - 1,229,685 - 2,937,858 5 Country View Road Malvern, PA * 785,168 4,678,632 134,612 3200 Horizon Blvd King of Prussia, PA - 928,637 - 4,291,215 3000 Horizon Boulevard King of Prussia, PA - 1,191,449 - 1,865,698 111-195 Witmer Road Horsham, PA - 407,005 3,129,058 95,602 300 Welsh Road Horsham, PA - 180,459 1,441,473 55,946 400 Welsh Road Horsham, PA - 282,493 2,256,508 946,356 8801 Tinicum Boulevard Philadelphia, PA - 2,474,031 - 24,427,073 440 East Swedesford Road King of Prussia, PA - 717,001 4,816,121 1,290,522 460 East Swedesford Road King of Prussia, PA - 705,317 4,737,487 300,975 50 Morehall Road Malvern, PA - 849,576 - 12,444,642 2 Walnut Grove Drive Horsham, PA - 1,281,870 7,767,374 686,718 200 Gibralter Road Horsham, PA - 638,513 5,811,323 73,144 220 Gibralter Road Horsham, PA - 629,944 5,733,228 12,048 240 Gibralter Road Horsham, PA - 629,944 5,733,234 12,092 151 S. Warner Road King of Prussia, PA - 1,218,086 6,937,866 53,025 1 Walnut Grove Drive Horsham, PA - 1,058,901 5,343,606 795,381 3606 Horizon Boulevard King of Prussia, PA - 789,409 - 1,924,523 650 Swedesford Road King of Prussia, PA - 952,911 6,722,830 6,535,572 680 Swedesford Road King of Prussia, PA - 952,361 6,722,830 6,668,953 761 Fifth Avenue King of Prussia, PA - 256,463 2,061,468 39,202 771 Fifth Avenue King of Prussia, PA - 152,456 1,256,908 59,970 1 Great Valley Parkway Malvern, PA - 419,460 3,792,570 87,647 5 Great Valley Parkway Malvern, PA - 684,200 6,181,661 70,612 311 Sinclair Road Bristol, PA - 277,901 1,576,906 2,039 181-187 Gibralter Road Horsham, PA - 440,549 3,979,984 3,126 104 Rock Road Horsham, PA - 330,111 2,981,669 2,334 123-135 Rock Road Horsham, PA - 292,360 2,640,689 2,066 111-159 Gibralter Road Horsham, PA - 489,032 4,417,099 3,458 161-175 Gibralter Road Horsham, PA - 360,673 3,257,722 16,596 125-137 Gibralter Road Horsham, PA - 319,906 2,889,500 2,262 261-283 Gibralter Road Horsham, PA - 494,871 4,469,840 3,499 210-223 Witmer Road Horsham, PA - 270,282 2,441,276 1,912 231-237 Gibralter Road Horsham, PA - 506,952 4,578,963 3,584 100 Gibralter Road Horsham, PA - 38,729 349,811 274 101 Gibralter Road Horsham, PA - 651,990 5,888,989 4,609 506 Prudential Road Horsham, PA - 99,140 895,470 701 80 Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE- Continued 113-123 Rock Road Horsham, PA - 351,072 3,171,001 2,482 101-111 Rock Road Horsham, PA - 350,561 3,166,389 2,478 120 Gibralter Road Horsham, PA - 533,142 4,830,515 33,335 110 Gibralter Road Horsham, PA - 655,041 5,916,549 4,632 100-107 Lakeside Drive Horsham, PA - 239,528 2,163,498 1,694 200-264 Lakeside Drive Horsham, PA - 502,705 4,540,597 157,400 300-309 Lakeside Drive Horsham, PA - 369,475 3,338,761 2,601 400-445 Lakeside Drive Horsham, PA - 543,628 4,910,226 3,844 201 Gibralter Road Horsham, PA - 380,127 3,433,433 74,648 3600 Horizon Drive King of Prussia, PA - 236,432 1,856,252 12,872 3602 Horizon Drive King of Prussia, PA - 217,734 1,759,489 8,446 400-500 Brandywine Parkway West Chester, PA - 845,846 6,809,025 6,229 600 Brandywine Parkway West Chester, PA - 664,899 5,352,410 4,896 14 Lee Boulevard Malvern, PA * 664,282 - 7,166,129 500 Chester Field Parkway Malvern, PA * 472,364 - 2,873,049 300-400 Chester Field Parkway Malvern, PA * 937,212 - 4,487,762 1805 Underwood Boulevard Delran, NJ 1,756,160 188,610 612,736 17,699 150 Mid-Atlantic Parkway West Deptford, NJ - 86,968 304,672 131,758 18 Boulden Circle New Castle, DE - 188,144 - 3,830,254 501 Delran Parkway Delran, NJ - 182,192 - 2,690,712 600 Delran Parkway Delran, NJ - 368,843 - 5,945,538 1607 Imperial Way West Deptford, NJ - 286,413 - 2,751,965 1 Boulden Circle New Castle, DE - 88,397 - 1,342,750 31-55 Read's Way New Castle, DE - 901,391 - 5,588,440 3 Boulden Circle New Castle, DE - 119,802 - 2,112,445 5 Boulden Circle New Castle, DE - 219,641 - 3,514,502 601 Delran Parkway Delran, NJ - 193,794 - 1,635,355 51 Haddonfield Road Cherry Hill, NJ - 251,443 - 9,246,387 57 Read's Way New Castle, DE 2,424,227 253,119 - 2,809,781 1370 Imperial Way West Deptford, NJ - 297,000 4,373,155 39,539 8 Stow Road Marlton, NJ - 172,600 1,704,436 83,930 10 Stow Road Marlton, NJ - 147,000 1,451,536 9,799 12 Stow Road Marlton, NJ - 103,300 1,021,036 152,383 14 Stow Road Marlton, NJ - 93,100 920,336 130,753 1300 Metropolitan Avenue West Deptford, NJ - 220,000 1,980,000 37,266 701A Route 73 South Marlton, NJ - 264,387 3,772,000 786,779 701C Route 73 South Marlton, NJ - 84,949 1,328,000 254,873 1008 Astoria Boulevard Cherry Hill, NJ - 27,120 424,880 376,952 1475 Imperial Way West Deptford, NJ - 54,000 846,000 186,789 3000 Atrium Way Mt. Laurel, NJ * 500,000 4,500,000 2,740,832 750 Cardinal Drive Pureland, NJ - 230,000 2,070,000 503,481 11000, 15000, 17000 Commerce Parkway Mt. Laurel, NJ - 455,100 4,394,900 488,975 12000, 14000 Commerce Parkway Mt. Laurel, NJ - 361,800 3,285,817 138,238 16000, 18000 Commerce Parkway Mt. Laurel, NJ - 289,700 2,512,683 348,273 406 Lippincott Drive Marlton, NJ - 321,455 1,539,871 791,862 234 High Hill Road Bridgeport, NJ * 249,472 1,477,515 335,497 231 Lake Drive New Castle, DE - 623,043 - 3,612,554 100 Arlington Boulevard Bridgeport, NJ - 6,368 - 4,533,465 100 Berkeley Drive Swedesboro, NJ * 395,160 1,915,215 166,600 301 Lippincott Drive Marlton, NJ - 1,069,837 4,780,163 381,473 303 Lippincott Drive Marlton, NJ - 1,069,837 4,780,163 349,965 510-512 Sharptown Road Bridgeport, NJ * 125,410 1,072,683 34,802 901 Route 73 (901 Building) Marlton, NJ - 334,411 2,733,314 87,854 Four Greentree Center Marlton, NJ * 449,400 3,074,850 458,860 512 Sharptown Road Bridgeport, NJ * 180,468 1,543,617 44,243 15 Boulden Circle New Castle, DE - 406,064 - 2,966,112 404 Lippincott Drive Marlton, NJ - 131,896 - 1,650,600 263 Quigley Blvd New Castle, DE - 170,386 1,302,739 109,251 34 Blevins Drive New Castle, DE - 195,932 1,498,061 46,334 104 Gaither Drive Mt Laurel, NJ - 132,075 1,151,988 219,653 2 Lukens Drive New Castle, DE - 169,050 1,290,150 97,389 402 Lippincott Drive Marlton, NJ - 131,896 - 1,687,179 3000 Lincoln Drive Mt. Laurel, NJ - 284,052 2,458,155 39,606 6000 Commerce Parkway Mt. Laurel, NJ - 234,151 2,022,683 56,254 7000 Commerce Parkway Mt. Laurel, NJ - 260,014 2,236,684 47,866 8000 Commerce Parkway Mt. Laurel, NJ - 234,814 1,995,098 32,420 9000 Commerce Parkway Mt. Laurel, NJ - 286,587 2,474,820 37,361 1000 Briggs Road Mt. Laurel, NJ - 288,577 2,546,537 205,299 1025 Briggs Road Mt. Laurel, NJ 2,182,957 430,990 3,714,828 5,109 2000 Crawford Place Mt. Laurel, NJ - 310,831 2,797,744 138,506 1351 Metropolitan Avenue Thorofare, NJ - 189,465 1,728,789 9,272 650 Grove Road Thorofare, NJ - 267,214 2,438,323 5,135 400 Grove Road Thorofare, NJ - 145,009 1,323,085 5,347 1655 Valley Center Parkway Bethlehem, PA 1,821,799 214,431 - 1,867,129 6560 Stonegate Drive Allentown, PA - 458,281 - 2,310,959 6370 Hedgewood Drive Allentown, PA 2,482,280 540,795 - 2,992,692 6390 Hedgewood Drive Allentown, PA 1,784,480 707,203 - 2,496,381 1495 Valley Center Parkway Bethlehem, PA 4,166,495 434,640 - 3,586,015 6350 Hedgewood Drive Allentown, PA 2,619,840 360,027 - 3,104,231 6330 Hedgewood Drive Allentown, PA - 531,268 - 4,203,583 1550 Valley Center Parkway Bethlehem, PA - 196,954 - 3,152,216 1560 Valley Center Parkway Bethlehem, PA - 240,069 - 3,778,113 6580 Snowdrift Road Allentown, PA - 388,328 - 2,436,637 1510 Valley Center Parkway Bethlehem, PA 3,379,289 312,209 - 3,232,782 1530 Valley Center Parkway Bethlehem, PA - 211,747 - 2,567,189 6540 Stonegate Drive Allentown, PA - 422,042 - 3,559,873 974 Marcon Boulevard Allentown, PA - 143,500 - 2,107,239 964 Marcon Street Allentown, PA 1,077,570 138,816 - 1,549,509 764 Roble Road Allentown, PA 771,660 141,069 - 794,167 3174 Airport Road Allentown, PA - 98,986 - 1,088,569 2196 Avenue C Allentown, PA - 101,159 - 1,201,733 2202 Hanger Place Allentown, PA - 137,439 - 1,288,063 2201 Hanger Place Allentown, PA - 128,454 - 1,403,049 81 Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE - Continued 954 Marcon Boulevard Allentown, PA - 103,665 - 916,156 57 South Commerce Way Allentown, PA - 390,839 2,701,161 162,948 754 Roble Road Allentown, PA - 162,115 1,731,885 61,766 894 Marcon Boulevard Allentown, PA - 117,134 1,048,866 23,434 744 Roble Road Allentown, PA - 159,771 1,734,229 123,584 944 Marcon Boulevard Allentown, PA - 118,521 1,435,479 141,175 1685 Valley Center Parkway Allentown, PA - 244,029 - 2,051,109 6520 Stonegate Drive Allentown, PA - 453,315 - 1,825,179 7437 Industrial Boulevard Allentown, PA - 717,488 5,022,413 1,330,656 2041 Avenue C Allentown, PA * 213,599 1,095,217 69,038 2124 Avenue C Allentown, PA * 289,197 1,039,835 54,349 7339 Industrial Boulevard Allentown, PA - 1,187,776 - 5,647,219 7384 Penn Drive Allentown, PA * 651,696 2,286,518 410,371 7144 Daniels Drive Allentown, PA - 2,390,217 2,342,761 3,418,554 7620 Cetronia Road Allentown, PA - 1,091,806 3,851,456 121,030 939 Marcon Blvd Allentown, PA * 2,220,414 4,524,393 734,002 100 Brodhead Road Allentown, PA * 429,416 2,919,588 160,678 1455 Valley Center Parkway Bethlehem, PA - 670,290 - 3,655,277 1640 Valley Center Parkway Bethlehem, PA - 359,000 - 2,414,216 1650 Valley Center Parkway Allentown, PA - 359,000 - 2,225,973 400 Nestle Way Allentown, PA 27,714,138 8,065,500 - 26,412,434 83 South Commerce Way Bethlehem, PA - 143,661 888,128 176,581 85 South Commerce Way Bethlehem, PA - 236,708 987,949 78,786 87 South Commerce Way Bethlehem, PA - 253,886 1,062,881 75,930 7339 Industrial Blvd Allentown, PA - 2,670,849 13,307,408 544,893 95 Highland Avenue Bethlehem, PA - 430,593 3,182,080 278,592 236 Brodhead Road Bethlehem, PA - 376,962 4,672,683 - 6620 Grant Way Allentown, PA - 430,824 1,915,923 4,241 7562 Penn Drive Allentown, PA - 269,614 844,069 4,080 7277 Williams Avenue Allentown, PA - 462,964 1,449,009 7,071 12000,001,040 Indian Creek Court Beltsville, MD 6,470,200 2,659,431 - 10,070,466 8280 Patuxent Range Drive Columbia, MD - 181,601 - 1,294,623 7178-80 Columbia Gateway Columbia, MD - 1,569,237 4,786,887 352,345 8730 Bollman Place Columbia, MD * 624,131 4,576,964 77,839 9770 Patuxent Woods Drive Columbia, MD - 341,663 3,033,309 4,208 9780 Patuxent Woods Drive Columbia, MD - 218,542 1,940,636 2,692 9790 Patuxent Woods Drive Columbia, MD - 243,791 2,164,094 3,038 9810 Patuxent Woods Drive Columbia, MD - 266,684 2,366,901 3,284 9800 Patuxent Woods Drive Columbia, MD - 299,099 2,654,069 3,684 9820 Patuxent Woods Drive Columbia, MD - 237,779 2,110,835 2,928 9830 Patuxent Woods Drive Columbia, MD - 296,262 2,628,933 3,691 9050 Red Branch Road Columbia, MD - 290,950 2,577,153 1,100 180,190 Cochrane Drive Annapolis, MD - 3,670,256 - 16,129,298 9101,9111,9115 Guilford Road Columbia, MD - 758,951 - 3,041,464 9125,9135,9145 Guilford Road Columbia, MD - 900,154 - 5,587,113 10 South Third Street Richmond, VA - 27,970 127,419 45,962 1751 Bluehills Drive Roanoke, VA - 1,063,728 8,500,677 101,951 4300 Carolina Avenue Richmond, VA - 2,007,717 14,927,608 411,598 301 Hill Carter Parkway Richmond, VA * 659,456 4,836,010 63,204 4001 Carolina Avenue Richmond, VA - 29,443 215,914 15,434 5600-5626 Eastport Boulevard Richmond, VA * 489,941 3,592,900 119,912 5650-5674 Eastport Boulevard Richmond, VA * 644,384 4,025,480 132,750 5700 Eastport Boulevard Richmond, VA * 408,729 2,697,348 43,619 11020 Hull Street Road Richmond, VA - 139,887 637,261 8,938 3432 Holland Road Virginia Beach, VA - 173,527 790,515 11,088 3001 Hungary Springs Road Richmond, VA * 136,270 620,785 (15,716) 7760 Shrader Road Richmond, VA * 187,971 756,313 17,191 7740 Shrader Road Richmond, VA * 81,200 369,911 38,061 4880 Cox Road Richmond, VA * 743,898 4,499,807 1,165,166 5162 Valleypointe Parkway Roanoke, VA * 551,483 2,612,312 35,237 4101-4127 Carolina Avenue Richmond, VA 1,331,660 310,854 2,279,597 45,665 4201-4261 Carolina Avenue Richmond, VA 3,043,796 693,203 5,083,493 117,171 4263-4299 Carolina Avenue Richmond, VA 1,902,372 256,203 2,549,649 156,368 4301-4335 Carolina Avenue Richmond, VA - 223,696 1,640,435 116,228 4337-4379 Carolina Avenue Richmond, VA 2,092,610 325,303 2,385,557 322,596 4501-4549 Carolina Avenue Richmond, VA 2,700,419 486,166 3,565,211 101,092 4551-4593 Carolina Avenue Richmond, VA 2,732,824 474,360 3,478,646 85,614 4601-4643 Carolina Avenue Richmond, VA 2,732,824 652,455 4,784,675 268,153 4545-4583 Carolina Avenue Richmond, VA 2,160,335 404,616 2,967,187 797,266 4447-4491 Carolina Avenue Richmond, VA 2,857,044 454,056 2,729,742 63,116 4401-4445 Carolina Avenue Richmond, VA * 615,038 4,510,272 75,786 12 S. Third Street Richmond, VA - 40,539 184,682 6,125 9601 Cosner Drive Fredericksburg, VA * 475,262 3,917,234 148,902 315 Cardiff Valley Road Knoxville, TN - 443,305 2,950,903 42,487 2300 East Parham Road Richmond, VA - 221,947 1,011,088 14,181 1347 Diamond Springs Road Virginia Beach, VA * 436,898 3,203,919 81,419 5221 Valleypark Drive - Bldg A Roanoke, VA 1,287,441 285,008 998,370 224,335 5228 Valleypointe Parkway - Bldg B Roanoke, VA 1,106,806 218,663 796,133 97,252 5238 Valleypark Drive - Bldg C Roanoke, VA 1,290,618 416,375 1,896,832 91,730 5601-5659 Eastport Boulevard Richmond, VA * 705,660 - 4,714,753 5900 Eastport Boulevard Richmond, VA * 676,661 - 4,416,258 4717-4729 Eubank Road Richmond, VA * 449,447 3,294,697 88,475 5251 Concourse Drive Roanoke, VA - 2,813 - 1,752,260 4263F-N. Carolina Ave Richmond, VA * 91,476 - 1,622,707 4200 Oakleys Court Richmond, VA * 459,090 2,468,454 31,223 1821 Battery Dantzler Road Chester, VA - 394,212 3,035,113 18,333 5000 Cox Road Glen Allen, VA * 770,214 3,685,248 28,744 510 Eastpark Court Sandston, VA * 261,961 2,110,874 37,152 520 Eastpark Court Sandston, VA * 486,118 4,083,582 47,804 600 Liberty Way Chesterfield, VA - 146,126 - 5,240,282 500 Liberty Way Chester, VA - 142,692 - 4,501,321 4198 Cox Road Glen Allen, VA - 670,292 3,839,245 - 4510 Cox Road Glen Allen, VA - 1,010,024 7,469,828 18,452 82 Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE - Continued 2809 South Lynnhaven Road Virginia Beach, VA - 953,590 6,142,742 7,515 200 Golden Oak Court Virginia Beach, VA - 1,116,693 6,770,480 8,802 208 Golden Oak Court Virginia Beach, VA - 965,177 6,728,717 7,606 1 Enterprise Parkway Hampton, VA - 974,675 5,579,869 7,684 22 Enterprise Parkway Hampton, VA - 1,097,368 6,760,778 8,642 4523 Green Point Drive High Point, NC 900,000 234,564 - 1,922,997 4501 Green Point Drive High Point, NC 1,153,943 319,289 - 2,213,201 4500 Green Point Drive High Point, NC 946,057 230,622 - 1,994,630 2427 Penny Road High Point, NC 6,607,645 1,165,664 - 6,187,028 4524 Green Point Drive High Point, NC * 182,810 - 2,104,406 4328, 4336 Federal Drive High Point, NC 6,244,530 521,122 - 7,644,052 200 Centreport Drive Greensboro, NC * 331,400 3,768,600 244,158 4344 Federal Drive High Point, NC * 484,001 - 2,324,176 202 Centreport Drive Greensboro, NC * 549,948 5,360,462 149,059 4000 Piedmont Parkway High Point, NC * 592,885 4,825,615 136,857 4380 Federal Drive High Point, NC - 282,996 - 2,034,262 4388 Federal Drive High Point, NC - 143,661 - 1,119,110 6532 Judge Adams Road Rock Creek, NC - 354,903 - 3,504,761 3860 Faber Place N. Charleston, SC * 796,655 1,974,359 - 4055 Faber Place N. Charleston, SC * 882,352 4,794,144 - 3820 Faber Place N. Charleston, SC * 506,558 2,365,146 - 440 Knox Abbott Drive Cayce, SC * 576,767 3,395,168 53,184 Alcoa Fujikura Facility Duncan, SC * 711,353 8,056,324 - 1320 Garlington Road Greenville, SC * 398,539 1,761,533 - 9800 Twin Lakes Parkway Charlotte, NC * 420,079 2,152,047 - 420 Park Avenue Greenville, SC * 522,548 2,730,261 275,887 111 Southchase Blvd. Fountain Inn, SC * 499,065 4,570,357 291,542 300 International Blvd. Fountain Inn, SC - 180,560 639,305 - 1208 Eastchester Drive High Point, NC - 487,209 4,200,817 164,329 One Independence Pointe Greenville, SC - 780,881 6,199,230 15,957 55 Beattie Place Greenville, SC - 2,643,105 23,439,801 19,477 75 Beattie Place Greenville, SC - 2,406,646 17,400,939 17,766 1730 Stebbins Drive Houston, TX - 143,258 - 413,414 5911-5925 Richard Street Jacksonville, FL - 275,582 - 508,059 8383-8385 Baycenter Road Jacksonville, FL - 63,703 - 527,320 8775 Baypine Road Jacksonville, FL - 906,804 - 2,892,795 8539 Western Way Jacksonville, FL - 328,133 - 3,127,137 6255 Lake Gray Boulevard Jacksonville, FL - 813,067 - 3,293,421 6600-6660 Suemac Place Jacksonville, FL - 210,804 - 1,891,471 6800-6850 Suemac Place Jacksonville, FL - 121,077 - 978,170 8665,8667,8669 Baypine Road Jacksonville, FL - 966,552 - 3,911,474 8540 Baycenter Road Jacksonville, FL - 445,603 - 1,371,536 1200 Gulf Life Drive Jacksonville, FL - 1,028,864 - 16,765,527 8400 Baymeadows Way Jacksonville, FL - 557,682 - 2,331,874 8614 Baymeadows Way Jacksonville, FL - 290,291 - 1,110,880 5941-5975 Richard Street Jacksonville, FL - 583,622 - 1,113,225 7970 Bayberry Road Jacksonville, FL - 127,520 - 1,199,583 6000-6030 Bowdendale Avenue Jacksonville, FL - 275,475 - 1,513,480 7898 Baymeadows Way Jacksonville, FL - 561,802 - 1,972,330 5977-6607 Richard Street Jacksonville, FL - 180,033 - 1,565,681 7910 & 7948 Baymeadows Way Jacksonville, FL - 210,299 - 2,678,714 7954 & 7960 Baymeadows Way Jacksonville, FL - 291,312 - 2,980,181 8787 Baypine Road Jacksonville, FL - 2,076,306 - 34,505,962 7077 Bonneval Road Jacksonville, FL - 768,000 5,789,000 783,696 4190 Belfort Road Jacksonville, FL - 821,000 5,866,000 1,007,607 8011, 8021, 8031 Phillips Highway Jacksonville, FL - 626,250 3,548,750 411,643 7020 AC Skinner Parkway Jacksonville, FL * 398,257 - 2,501,809 11777 Central Highway Jacksonville, FL - 92,207 429,997 1,488,577 7016 AC Skinner Parkway Jacksonville, FL - 597,181 - 2,326,445 7018 AC Skinner Parkway Jacksonville, FL - 840,996 - 4,005,625 6620 Southpoint Drive Jacksonville, FL - 614,602 4,267,477 175,376 7980 Bayberry Road Jacksonville, FL - 330,726 1,338,101 3,120 9600 Satellite Boulevard Orlando, FL - 252,850 1,297,923 7,618 9700 Satellite Boulevard Orlando, FL - 405,362 1,146,546 7,617 1902 Cypress Lake Drive Orlando, FL - 523,512 3,191,790 210,148 8250 & 8256 Exchange Place Orlando, FL - 622,413 2,507,842 26,571 6600 Southpoint Parkway Jacksonville, FL - 998,432 4,055,727 12,948 6700 Southpoint Parkway Jacksonville, FL - 620,719 3,178,610 8,737 4801 Executive Park Court - 100 Jacksonville, FL * 554,542 4,568,633 4,066 4801 Executive Park Court - 200 Jacksonville, FL * 370,039 1,947,751 2,717 4810 Executive Park Court Jacksonville, FL * 370,039 1,947,751 2,717 6602 Executive Park Court - 100 Jacksonville, FL * 388,541 2,045,139 2,852 6602 Executive Park Court - 200 Jacksonville, FL * 296,032 1,558,201 2,173 6631 Executive Park Court - 100 Jacksonville, FL * 251,627 1,324,470 1,848 6631 Executive Park Court - 200 Jacksonville, FL * 407,043 2,142,526 2,988 4815 Executive Park Court - 100 Jacksonville, FL * 366,339 1,928,274 2,689 4815 Executive Park Court - 200 Jacksonville, FL * 462,549 2,434,689 3,395 4825 Executive Park Court Jacksonville, FL * 601,314 3,165,095 4,414 4820 Executive Park Court Jacksonville, FL * 555,213 2,621,474 4,076 10511 & 10611 Satellite Boulevard Orlando, FL - 517,554 2,568,186 3,756 1400-1440 Central Florida Parkway Orlando, FL - 518,043 2,561,938 4,558 4001,4051,4101 Fowler Avenue Tampa, FL - 1,299,310 - 4,654,970 5501-5502 Pioneer Park Boulevard Tampa, FL - 162,000 1,613,000 217,844 5690-5694 Crenshaw Street Tampa, FL - 181,923 1,812,496 30,484 3102,3104,3110 Cherry Palm Drive Tampa, FL - 503,767 2,787,585 43,826 7040 AC Skinner Parkway Jacksonville, FL * 706,934 - 3,110,792 8401-8408 Benjamin Road Tampa, FL - 789,651 4,454,648 236,881 3501 Riga Blvd Tampa, FL - 617,289 3,048,379 1,376 111 Kelsey Land Tampa, FL - 359,540 1,461,850 47,875 7930, 8010-20 Woodland Center Tampa, FL * 1,408,478 5,247,246 - 7920 Woodland Center Boulevard Tampa, FL * 1,382,648 2,445,444 393,418 8154-8198 Woodland Center Tampa, FL * 399,088 2,868,834 - 8112-42 Woodland Center Tampa, FL * 513,263 3,230,239 - 83 Cost Capitalized Initial Cost Subsequent ------------------------- to Project City Encumbrances Land Building Acquisition - -------------------------------------- ------------------- ------------ ------------ -------------- ------------ OPERATING REAL ESTATE - Continued 8212 Woodland Center Tampa, FL * 820,882 2,322,720 256,755 1701 Clint Moore Blvd Boca Raton, FL - 1,430,884 3,043,553 12,533 4555 Riverside Drive Beach Gardens, FL - 805,672 5,782,360 6,406 2500 Metrocentre Boulevard West Palm Beach, FL - 238,362 1,534,926 1,795 2540 Metrocenter Boulevard West Palm Beach, FL - 165,071 1,058,736 1,234 2541 Metrocentre Boulevard West Palm Beach, FL - 145,091 379,318 556,776 2580 Metrocentre Boulevard West Palm Beach, FL - 256,478 1,651,602 1,931 2581 Metrocentre Boulevard West Palm Beach, FL - 189,359 1,218,712 1,856 5410 - 5430 Northwest 33rd Avenue Ft. Lauderdale, FL - 603,776 4,176,238 4,481 2905 Northwest Boulevard Plymouth, MN - 516,920 4,646,342 111,638 2800 Campus Drive Plymouth, MN - 395,366 3,554,512 138,202 2955 Xenium Lane Plymouth, MN - 151,238 1,370,140 9,512 9401-9443 Science Center Drive New Hope, MN - 431,295 3,888,684 37,523 6321-6325 Bury Drive Eden Prairie, MN - 462,876 4,151,790 14,788 7115-7173 Shady Oak Road Eden Prairie, MN - 454,974 4,089,410 49,331 7660-7716 Golden Triangle Drive Eden Prairie, MN - 568,706 5,115,177 (9,612) 7400 Flying Cloud Drive Eden Prairie, MN - 195,982 1,762,027 - 330 Second Avenue Minneapolis, MN - 1,481,560 13,043,160 1,251,901 10301-10305 West 70th Street Eden Prairie, MN * 120,622 1,085,226 71,564 10321 West 70th Street Eden Prairie, MN * 145,198 1,305,700 31,390 10333 West 70th Street Eden Prairie, MN * 110,746 995,868 26,999 10349-10357 West 70th Street Eden Prairie, MN * 275,903 2,481,666 255,326 10365-10375 West 70th Street Eden Prairie, MN * 291,077 2,618,194 14,270 10393-10394 West 70th Street Eden Prairie, MN * 269,618 2,423,318 224,195 7078 Shady Oak Road Eden Prairie, MN * 343,093 3,085,795 3,138 5600 & 5610 Rowland Road Minnetonka, MN - 828,650 7,399,409 53,032 2920 Northwest Boulevard Plymouth, MN - 392,026 3,433,678 26,267 26911-26957 Northwestern Southfield, MI - 7,799,515 66,268,817 3,616,706 1650 Research Drive Troy, MI - 763,067 7,201,677 39,172 1775 Research Drive Troy, MI - 331,422 2,788,073 37,674 1875 Research Drive Troy, MI - 329,863 2,774,006 37,675 1850 Research Drive Troy, MI - 781,054 7,364,300 40,071 1965 Research Drive Troy, MI - 419,090 3,578,928 37,675 1960 Research Drive Troy, MI - 419,146 3,579,166 37,675 27260 Haggerty Road Farmington Hills, MI - 456,877 4,091,196 13,745 27200 Haggerty Road Farmington Hills, MI - 382,754 3,425,227 9,091 27280 Haggerty Road Farmington Hills, MI - 452,860 4,055,512 12,180 27220 Haggerty Road Farmington Hills, MI - 203,064 1,802,592 10,807 27240 Haggerty Road Farmington Hills, MI - 171,518 1,518,192 10,690 27300 Haggerty Road Farmington Hills, MI - 370,378 3,311,366 23,633 1101 Allen Drive Troy, MI - 98,144 887,935 5,433 1151 Allen Drive Troy, MI - 164,483 1,486,220 7,171 1300 Rankin Street Troy, MI - 134,090 1,212,752 87 1350 Rankin Street Troy, MI - 111,776 1,011,497 73 1376-1400 Rankin Street Troy, MI - 134,292 1,213,626 17,220 1352-1374 Rankin Street Troy, MI - 153,275 1,385,098 1,181 1324-1346 Rankin Street Troy, MI - 134,090 1,212,214 1,029 1301-1307 Rankin Street Troy, MI - 111,776 1,011,121 853 1409 Allen Drive Troy, MI - 142,370 1,286,048 15,373 1304 E Maple Road Troy, MI - 211,233 1,906,786 1,642 1334 Maplelawn Road Troy, MI - 124,296 1,122,802 960 1290 Maplelawn Road Troy, MI - 85,321 771,621 653 1070 Maplelawn Road Troy, MI - 68,560 620,595 520 950 Maplelawn Road Troy, MI - 252,429 2,265,259 12,838 894 Maplelawn Road Troy, MI - 181,749 1,632,243 9,234 1179 Maplelawn Road Troy, MI - 87,845 794,365 673 1940 Norwood Drive Troy, MI - 86,836 785,267 666 1311-1331 Maplelawn Road Troy, MI - 125,407 1,132,810 969 2354 Bellingham Street Troy, MI - 87,340 789,817 670 2360 Bellingham Street Troy, MI - 87,340 789,817 670 1911 Ring Drive Troy, MI - 86,129 778,900 659 26442-26450 Haggerty Road Farmington Hills, MI - 237,687 2,143,478 7,724 26500 Haggerty Road Farmington Hills, MI - 311,093 2,791,804 26,776 26650 Haggerty Road Farmington Hills, MI - 173,166 1,562,704 7,211 26700 Haggerty Road Farmington Hills, MI - 253,338 2,290,696 1,941 26750 Haggerty Road Farmington Hills, MI - 292,717 2,638,688 8,164 26800 Haggerty Road Farmington Hills, MI - 175,489 1,583,362 7,230 26842-26850 Haggerty Road Farmington Hills, MI - 239,606 2,160,470 7,741 50 Gibson Drive West Malling, UK - - - 3,746,462 25 Kings Hill Avenue West Malling, UK 5,777,800 1,105,380 - 5,651,440 2 Kings Hill Avenue West Malling, UK - 785,565 - 4,829,117 50 Kings Hill Avenue West Malling, UK - 1,215,608 - 13,535,076 ------------- ------------ -------------- ------------ Subtotal Operating Real Estate $ 117,375,737 $233,673,546 $1,005,120,296 $639,545,602 ============= ============ ============== ============ DEVELOPMENT PROPERTIES 132 Welsh Road Horsham, PA $ - $ 1,333,642 $ - $ 3,106,078 3604 Horizon Blvd King of Prussia, PA - 397,178 - 1,835,360 100 Cedar Hollow Road Malvern, PA - 1,436,814 - 5,281,365 3 Country View Road Malvern, PA - 814,278 - 2,497,206 425 Technology Drive Malvern, PA - 191,114 - 1,231,595 375 Technology Drive Malvern, PA - 191,114 - 249,282 100 Chesterfield Pkwy Malvern, PA - 1,320,625 - 889,771 201 Berkeley Drive Bridgeport, NJ - 270,880 - 1,083,711 300 Commodore Drive Bridgeport, NJ - 417,695 - 1,786,429 1660 Valley Center Parkway Bethlehem, PA - 359,000 - 1,648,848 89 South Commerce Way Bethlehem, PA - 320,000 - 1,401,533 1525 Valley Ctr Pkwy Allentown, PA - 475,686 - 3,930,288 700 Nestle Way Allentown, PA - 3,473,120 - 16,029,435 5500 Cox Road Richmond, VA - 443,485 - 1,456,889 13001 Kingston Ave Richmond, VA - 376,584 - 1,723,267 5701-5799 Eastport Blvd Richmond, VA - 694,644 - 4,724,601 84 Cost Capitalized Initial Cost Subsequent --------------------------- to Project City Encumbrances Land Building Acquisition - ------------------------------------- ------------------- ------------ ------------ -------------- ------------- 4801 Cox Road Richmond, VA - 1,072,896 - 3,212,269 701 Liberty Way Richmond, VA - 171,711 - 3,602,218 5310 Valley Park Drive Roanoke, VA - 149,933 - 528,613 5305 Valley Park Drive Roanoke, VA - 266,948 - 603,603 530 Eastpark Court Sandston, VA - 266,883 - 1,122,780 101 Centreport Greensboro, NC - 826,237 - 5,225,165 6532 Judge Adams Road Whitsett, NC - 305,821 - 3,164,486 3875 Faber Place N. Charleston, SC * 1,164,530 - 5,393,510 1 Alliance Drive Goose Creek, SC * 662,422 - 1,468,894 1150 Northpoint Blvd Blythwood, SC * 741,692 - 1,348,001 4160 Mendenhall Oaks Pkwy High Point, NC - 285,882 - 2,622,759 4194 Mendenhall Oaks Pkwy High Point, NC - 102,372 - 1,378,708 4196 Mendenhall Oaks Pkwy High Point, NC - 66,731 - 1,213,758 4170 Mendenhall Oaks Pkwy High Point, NC - 143,699 - 1,425,681 4180 Mendenhall Oaks Pkwy High Point, NC - 121,329 - 1,191,030 7720 Mendenhall Oaks Pkwy High Point, NC - 801,902 - 9,213,047 4345 Southpoint Parkway Jacksonville, FL - - - 7,744,796 131 Silo Bend Tampa, FL - 511,463 - 1,787,484 7724 Woodland Ctr Blvd Tampa, FL - 235,893 - 503,831 7802-50 Woodland Ctr Blvd Tampa, FL - 357,364 - 676,414 7852-98 Woodland Ctr Blvd Tampa, FL - 357,364 - 725,779 8921 Brittany Way Tampa, FL - 255,583 - 122,115 6601-6625 W. 78th Street Bloomington, MN - 2,263,060 - 13,330,686 10400 Southwest Crossing Eden Prairie, MN - 2,912,391 - 1,805,356 10 Kings Hill Ave West Malling, UK - 983,547 - 3,008,337 30 Tower View West Malling, UK - 1,657,321 - 2,546,004 35 Kings Hill Ave West Malling, UK - 812,193 - 2,239,449 ------------- ------------ -------------- ------------ Subtotal Development in Progress $ - $ 30,013,025 $ - $126,080,430 ============= ============ ============== ============ LAND HELD FOR DEVELOPMENT Chelsea Business Park Land Boothwyn, PA $ - $ 1,236,146 $ - $ 660,742 Gwynedd North Bus Camp Land Lansdale, PA - - - 257,945 Three Country View Road Malvern, PA - 912,890 - (906,713) 550 Lapp Road Malvern, PA - 380,891 - (378,317) Cedar Hollow Road Land Malvern, PA - 1,429,473 - (1,429,473) Walnut Grove Land Horsham, PA - 3,435,695 - 503,160 Iron Run Land Upper Macungie, PA - 753,056 - 35,225 35 Liberty Blvd Land Malvern, PA - - - - 45 Liberty Blvd Land Malvern, PA - 4,380,221 - 199,096 Great Valley Land Malvern, PA - 4,674,633 - 231,107 10 Matthews Rd South Land Malvern, PA - 578,804 - 30,191 104 Witmer Road Horsham, PA - 1,248,148 - - 3 Franklin Plaza Philadelphia, PA - 2,483,144 - 20,204 2700 Horizon Dr King of Prussia, PA - 764,370 - 3,579 2900 Horizon Dr King of Prussia, PA - 679,440 - 3,181 2500 Renaissance Blvd King of Prussia, PA - 509,580 - 2,387 2300 Renaissance Blvd King of Prussia, PA - 509,580 - 2,387 Swedes Run Business Park Land Delran, NJ - 1,057,204 - 558,201 Marlton Crossing Land Marlton, NJ - 69,402 - 181,093 Commodore Business Park Logan Twp., NJ - 2,903,914 - 1,479,771 Boulden Land New Castle, DE - - - - Marlton Executive Park Land Marlton, NJ - 550,664 - 215,198 17 Boulden Circle New Castle, DE - 374,982 - 312,489 1015 Briggs Road Land Mt. Laurel, NJ - 356,987 - 16,386 1020 Briggs Road Land Mt. Laurel, NJ - 494,334 - 38,925 Lehigh Valley Corporate Center Land Bethlehem, PA - 2,254,312 - (944,324) Rivers' Bend Land Chesterfield Cty, VA - 1,172,108 - 7,287,973 Oakleys Center Land Richmond, VA - 228,757 - 57,385 Woodlands Center Land Sandston, VA - 1,108,117 - 168,054 501 Liberty Way Chesterfield City, VA - 441,188 - 156,807 601 Hewlett Packard Way Chesterfield City, VA - 171,024 - 435,668 6000-98 Eastport Blvd Richmond, VA - 787,091 - - Eastport VIII Richmond, VA - 379,836 - - Eastport IX Richmond, VA - 209,856 - - Park at Valleypointe Land Roanoke, VA - 238,545 - 406,297 Fairgrounds Distribution Center Land Richmond, VA - 100,000 - 30,304 Mendenhall Land High Point, NC - 2,528,914 - 1,485,493 Independence Pointe Land Greenville, SC - 1,304,084 - 14,855 Southpoint Business Park Land Jacksonville, FL - 756,000 - (317,914) 7024 AC Skinner Parkway Jacksonville, FL - 839,554 - (215,071) 7014 AC Skinner Pkwy Jacksonville, FL - 574,198 - 206,288 Silo Bend Land Tampa, FL - 4,104,030 - 508,590 Cypress Park Land Orlando, FL - 517,445 - 12,489 Exchange Place Land Orlando, FL - 193,406 - 8,711 Liberty Business Park Land Jacksonville, FL - 1,379,053 - 653,370 Airport West Tampa, FL - 67,510 - (67,028) West Tech Park Land (Lot B) Farmington Hills, MI - 455,846 - 9,347 West Tech Park Land (Lot C) Farmington Hills, MI - 368,083 - 7,519 ------------- ------------ -------------- ------------ Subtotal Land Held for Development $ - $ 49,962,515 $ $ 11,941,578 ============= ============ ============== ============ Total All Properties $ 117,375,737 $313,649,086 $1,005,120,296 $777,567,611 ============= ============ ============== ============ * Denotes property is collateralized under mortgages with Nationwide, Principal Mutual, American General and Jackson National Life totalling $246.2 million. ** Rouse leases land from Kent County Council.
85 LIBERTY PROPERTY LIMITED PARTNERSHIP REAL ESTATE AND ACCUMULATED DEPRECIATION AS OF DECEMBER 31, 1997
Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE 10,20 Liberty Boulevard Malvern, PA $ 645,318 $ 4,922,084 $ 5,567,402 420 Lapp Road Malvern, PA 1,049,243 6,332,598 7,381,841 1 Chelsea Parkway Boothwyn, PA 245,735 2,610,437 2,856,172 3 Chelsea Parkway Boothwyn, PA 209,177 2,864,067 3,073,244 747 Dresher Road Horsham, PA 1,611,977 3,941,549 5,553,526 45-67 Great Valley Parkway Malvern, PA 795,831 2,845,540 3,641,371 1180 Church Road Lansdale, PA 2,389,598 14,786,322 17,175,920 40 Valley Stream Parkway Malvern, PA 323,792 2,184,948 2,508,740 50 Valley Stream Parkway Malvern, PA 371,068 2,328,630 2,699,698 20 Valley Stream Parkway Malvern, PA 466,413 5,043,549 5,509,962 800 Town Center Drive Langhorne, PA 1,617,803 8,775,533 10,393,336 1610 Medical Drive Pottstown, PA 212,413 2,498,318 2,710,731 9, 15 Great Valley Parkway Malvern, PA 1,837,878 14,959,104 16,796,982 257-275 Great Valley Parkway Malvern, PA 505,458 4,360,723 4,866,181 300 Technology Drive Malvern, PA 374,497 1,287,776 1,662,273 277-293 Great Valley Parkway Malvern, PA 531,534 1,888,300 2,419,834 311 Technology Drive Malvern, PA 348,099 2,245,878 2,593,977 325 Technology Drive Malvern, PA 385,693 1,841,992 2,227,685 7 Great Valley Parkway Malvern, PA 177,317 4,228,959 4,406,276 55 Valley Stream Parkway Malvern, PA 215,818 3,095,596 3,311,414 65 Valley Stream Parkway Malvern, PA 382,361 4,684,211 5,066,572 508 Lapp Road Malvern, PA 263,116 1,768,410 2,031,526 10 Valley Stream Parkway Malvern, PA 465,135 2,680,337 3,145,472 333 Phoenixville Pike Malvern, PA 524,229 3,086,606 3,610,835 1566 Medical Drive Pottstown, PA 203,827 1,843,567 2,047,394 30 Great Valley Parkway Malvern, PA 128,783 354,908 483,691 75 Great Valley Parkway Malvern, PA 143,811 418,152 561,963 27-43 Great Valley Parkway Malvern, PA 449,447 2,084,388 2,533,835 77-123 Great Valley Parkway Malvern, PA 888,359 4,423,219 5,311,578 260 Great Valley Parkway Malvern, PA 212,768 840,159 1,052,927 256 Great Valley Parkway Malvern, PA 161,949 1,887,910 2,049,859 205 Great Valley Parkway Malvern, PA 1,369,003 9,505,668 10,874,671 12,14,16 Great Valley Parkway Malvern, PA 131,517 1,162,260 1,293,777 155 Great Valley Parkway Malvern, PA 626,068 2,197,560 2,823,628 333 Technology Drive Malvern, PA 90,952 2,377,145 2,468,097 510 Lapp Road Malvern, PA 325,415 896,745 1,222,160 181 Wheeler Court Langhorne, PA 263,490 2,043,504 2,306,994 1100 Wheeler Way Langhorne, PA 151,500 1,189,217 1,340,717 60 Morehall Road Malvern, PA 884,974 14,061,835 14,946,809 905 Airport Road West Chester, PA 1,735,012 5,367,089 7,102,101 16 Cabot Boulevard Langhorne, PA 649,743 5,926,232 6,575,975 1 Country View Road Malvern, PA 406,421 3,987,425 4,393,846 2151 Cabot Boulevard Langhorne, PA 389,990 3,714,510 4,104,500 170 South Warner Road King of Prussia, PA 555,911 5,212,074 5,767,985 190 South Warner Road King of Prussia, PA 560,373 4,336,792 4,897,165 507 Prudential Road Horsham, PA 652,919 6,027,128 6,680,047 100 Witmer Road Horsham, PA 3,133,783 9,654,338 12,788,121 3100 Horizon Blvd King of Prussia, PA 611,435 1,997,769 2,609,205 3300 Horizon Blvd King of Prussia, PA 687,878 3,140,188 3,828,066 3500 Horizon Blvd King of Prussia, PA 1,223,875 2,510,960 3,734,836 200 Chester Field Parkway Malvern, PA 495,893 2,860,398 3,356,291 767 Electronic Drive Horsham, PA 1,241,970 2,925,573 4,167,543 5 Country View Road Malvern, PA 786,235 4,812,177 5,598,412 3200 Horizon Blvd King of Prussia, PA 1,210,136 4,009,715 5,219,852 3000 Horizon Blvd King of Prussia, PA 946,703 2,110,444 3,057,147 111-195 Witmer Road Horsham, PA 407,205 3,224,461 3,631,665 300 Welsh Road Horsham, PA 180,459 1,497,418 1,677,877 400 Welsh Road Horsham, PA 282,493 3,202,863 3,485,356 8801 Tinicum Boulevard Philadelphia, PA 124,062 26,777,043 26,901,104 440 East Swedesford Road King of Prussia, PA 717,001 6,106,643 6,823,644 460 East Swedesford Road King of Prussia, PA 705,317 5,038,463 5,743,779 50 Morehall Road Malvern, PA 1,337,076 11,957,142 13,294,218 2 Walnut Grove Drive Horsham, PA 1,265,363 8,470,599 9,735,962 200 Gibralter Road Horsham, PA 638,513 5,884,467 6,522,980 220 Gibralter Road Horsham, PA 629,944 5,745,277 6,375,220 240 Gibralter Road Horsham, PA 629,944 5,745,326 6,375,270 151 S. Warner Road King of Prussia, PA 1,218,086 6,990,891 8,208,977 1 Walnut Grove Drive Horsham, PA 1,058,901 6,138,987 7,197,888 3606 Horizon Boulevard King of Prussia, PA 815,855 1,898,077 2,713,932 650 Swedesford Road King of Prussia, PA 952,911 13,258,401 14,211,312 680 Swedesford Road King of Prussia, PA 952,361 13,391,783 14,344,144 761 Fifth Avenue King of Prussia, PA 256,463 2,100,670 2,357,133 771 Fifth Avenue King of Prussia, PA 152,456 1,316,878 1,469,334 1 Great Valley Parkway Malvern, PA 419,460 3,880,217 4,299,677 5 Great Valley Parkway Malvern, PA 684,200 6,252,273 6,936,473 311 Sinclair Road Bristol, PA 277,901 1,578,945 1,856,846 181-187 Gibralter Road Horsham, PA 440,549 3,983,110 4,423,659 104 Rock Road Horsham, PA 330,111 2,984,003 3,314,114 123-135 Rock Road Horsham, PA 292,360 2,642,755 2,935,115 111-159 Gibralter Road Horsham, PA 489,032 4,420,557 4,909,589 161-175 Gibralter Road Horsham, PA 360,673 3,274,318 3,634,991 125-137 Gibralter Road Horsham, PA 319,906 2,891,761 3,211,667 261-283 Gibralter Road Horsham, PA 494,871 4,473,339 4,968,210 210-223 Witmer Road Horsham, PA 270,282 2,443,188 2,713,470 231-237 Gibralter Road Horsham, PA 506,952 4,582,547 5,089,499 100 Gibralter Road Horsham, PA 38,729 350,085 388,814 101 Gibralter Road Horsham, PA 651,990 5,893,598 6,545,588 506 Prudential Road Horsham, PA 99,140 896,171 995,311 86 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE - Continued 113-123 Rock Road Horsham, PA 351,072 3,173,483 3,524,555 101-111 Rock Road Horsham, PA 350,561 3,168,867 3,519,428 120 Gibralter Road Horsham, PA 533,142 4,863,850 5,396,992 110 Gibralter Road Horsham, PA 655,041 5,921,181 6,576,222 100-107 Lakeside Drive Horsham, PA 239,528 2,165,192 2,404,720 200-264 Lakeside Drive Horsham, PA 502,705 4,697,997 5,200,702 300-309 Lakeside Drive Horsham, PA 369,475 3,341,362 3,710,837 400-445 Lakeside Drive Horsham, PA 543,628 4,914,070 5,457,698 201 Gibralter Road Horsham, PA 380,127 3,508,081 3,888,208 3600 Horizon Drive King of Prussia, PA 236,432 1,869,124 2,105,556 3602 Horizon Drive King of Prussia, PA 217,734 1,767,935 1,985,669 400-500 Brandywine Parkway West Chester, PA 845,846 6,815,254 7,661,100 600 Brandywine Parkway West Chester, PA 664,899 5,357,306 6,022,205 14 Lee Boulevard Malvern, PA 665,053 7,165,358 7,830,411 500 Chester Field Parkway Malvern, PA 473,139 2,872,274 3,345,413 300-400 Chester Field Parkway Malvern, PA 931,212 4,493,762 5,424,974 1805 Underwood Boulevard Delran, NJ 196,901 622,144 819,045 150 Mid-Atlantic Parkway West Deptford, NJ 88,153 435,245 523,398 18 Boulden Circle New Castle, DE 198,062 3,820,336 4,018,398 501 Delran Parkway Delran, NJ 184,162 2,688,742 2,872,904 600 Delran Parkway Delran, NJ 372,719 5,941,662 6,314,381 1607 Imperial Way West Deptford, NJ 288,280 2,750,098 3,038,378 1 Boulden Circle New Castle, DE 93,309 1,337,838 1,431,147 31-55 Read's Way New Castle, DE 972,159 5,517,672 6,489,831 3 Boulden Circle New Castle, DE 126,701 2,105,546 2,232,247 5 Boulden Circle New Castle, DE 232,274 3,501,869 3,734,143 601 Delran Parkway Delran, NJ 193,336 1,635,813 1,829,149 51 Haddonfield Road Cherry Hill, NJ 248,326 9,249,504 9,497,830 57 Read's Way New Castle, DE 352,736 2,710,164 3,062,900 1370 Imperial Way West Deptford, NJ 298,010 4,411,684 4,709,694 8 Stow Road Marlton, NJ 172,945 1,788,021 1,960,966 10 Stow Road Marlton, NJ 147,318 1,461,017 1,608,335 12 Stow Road Marlton, NJ 103,618 1,173,102 1,276,720 14 Stow Road Marlton, NJ 93,418 1,050,772 1,144,190 1300 Metropolitan Avenue West Deptford, NJ 221,218 2,016,048 2,237,266 701A Route 73 South Marlton, NJ 271,743 5,551,423 5,823,166 701C Route 73 South Marlton, NJ 96,161 1,571,661 1,667,821 1008 Astoria Boulevard Cherry Hill, NJ 32,698 796,254 828,952 1475 Imperial Way West Deptford, NJ 58,606 1,028,183 1,086,789 3000 Atrium Way Mt. Laurel, NJ 512,018 7,228,814 7,740,832 750 Cardinal Drive Pureland, NJ 236,190 2,567,291 2,803,481 11000, 15000, 17000 Commerce Parkway Mt. Laurel, NJ 456,465 4,882,510 5,338,975 12000, 14000 Commerce Parkway Mt. Laurel, NJ 362,855 3,423,000 3,785,855 16000, 18000 Commerce Parkway Mt. Laurel, NJ 290,545 2,860,111 3,150,656 406 Lippincott Drive Marlton, NJ 327,554 2,325,633 2,653,187 234 High Hill Road Bridgeport, NJ 250,445 1,812,039 2,062,484 231 Lake Drive New Castle, DE 623,043 3,612,554 4,235,597 100 Arlington Boulevard Bridgeport, NJ 374,836 4,164,997 4,539,833 100 Berkeley Drive Swedesboro, NJ 401,254 2,075,721 2,476,975 301 Lippincott Drive Marlton, NJ 1,069,837 5,161,636 6,231,473 303 Lippincott Drive Marlton, NJ 1,069,837 5,130,128 6,199,965 510-512 Sharptown Road Bridgeport, NJ 125,410 1,107,485 1,232,895 901 Route 73 Marlton, NJ 334,411 2,821,167 3,155,579 Four Greentree Center Marlton, NJ 450,558 3,532,552 3,983,110 512 Sharptown Road Bridgeport, NJ 180,468 1,587,860 1,768,328 15 Boulden Circle New Castle, DE 447,306 2,924,869 3,372,176 404 Lippincott Drive Marlton, NJ 131,896 1,650,600 1,782,496 263 Quigley Blvd New Castle, DE 171,167 1,411,209 1,582,376 34 Blevins Drive New Castle, DE 196,396 1,543,931 1,740,327 104 Gaither Drive Mt Laurel, NJ 136,446 1,367,270 1,503,716 2 Lukens Drive New Castle, DE 169,118 1,387,471 1,556,589 402 Lippincott Drive Marlton, NJ 131,896 1,687,179 1,819,075 3000 Lincoln Drive Mt. Laurel, NJ 284,052 2,497,761 2,781,813 6000 Commerce Parkway Mt. Laurel, NJ 234,151 2,078,937 2,313,088 7000 Commerce Parkway Mt. Laurel, NJ 260,014 2,284,550 2,544,564 8000 Commerce Parkway Mt. Laurel, NJ 234,814 2,027,518 2,262,332 9000 Commerce Parkway Mt. Laurel, NJ 286,587 2,512,181 2,798,768 1000 Briggs Road Mt. Laurel, NJ 288,577 2,751,836 3,040,413 1025 Briggs Road Mt. Laurel, NJ 430,990 3,719,937 4,150,927 2000 Crawford Place Mount Laurel, NJ 310,831 2,936,250 3,247,081 1351 Metropolitan Avenue Thorofare, NJ 189,465 1,738,061 1,927,526 650 Grove Road Thorofare, NJ 267,214 2,443,458 2,710,672 400 Grove Road Thorofare, NJ 145,009 1,328,432 1,473,441 1655 Valley Center Parkway Bethlehem, PA 215,095 1,866,465 2,081,560 6560 Stonegate Drive Allentown, PA 437,122 2,332,118 2,769,240 6370 Hedgewood Drive Allentown, PA 515,707 3,017,780 3,533,487 6390 Hedgewood Drive Allentown, PA 670,819 2,532,765 3,203,584 1495 Valley Center Parkway Bethlehem, PA 258,014 3,762,641 4,020,655 6350 Hedgewood Drive Allentown, PA 360,691 3,103,567 3,464,258 6330 Hedgewood Drive Allentown, PA 499,720 4,235,131 4,734,851 1550 Valley Center Parkway Bethlehem, PA 188,320 3,160,851 3,349,170 1560 Valley Center Parkway Bethlehem, PA 229,301 3,788,881 4,018,182 6580 Snowdrift Road Allentown, PA 367,377 2,457,588 2,824,965 1510 Valley Center Parkway Bethlehem, PA 312,873 3,232,118 3,544,991 1530 Valley Center Parkway Bethlehem, PA 212,491 2,566,445 2,778,936 6540 Stonegate Drive Allentown, PA 422,730 3,559,185 3,981,915 974 Marcon Boulevard Allentown, PA 144,248 2,106,491 2,250,739 964 Marcon Street Allentown, PA 139,480 1,548,845 1,688,325 764 Roble Road Allentown, PA 141,746 793,490 935,236 3174 Airport Road Allentown, PA 98,986 1,088,569 1,187,555 2196 Avenue C Allentown, PA 107,307 1,195,585 1,302,892 2202 Hanger Place Allentown, PA 138,127 1,287,375 1,425,502 2201 Hanger Place Allentown, PA 129,142 1,402,361 1,531,503 87 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE - Continued 954 Marcon Boulevard Allentown, PA 104,452 915,369 1,019,821 57 South Commerce Way Allentown, PA 395,459 2,859,489 3,254,948 754 Roble Road Allentown, PA 163,735 1,792,031 1,955,766 894 Marcon Boulevard Allentown, PA 118,304 1,071,130 1,189,434 744 Roble Road Allentown, PA 161,371 1,856,213 2,017,584 944 Marcon Boulevard Allentown, PA 119,711 1,575,464 1,695,175 1685 Valley Center Parkway Allentown, PA 198,482 2,096,656 2,295,138 6520 Stonegate Drive Allentown, PA 948,395 1,330,099 2,278,494 7437 Industrial Boulevard Allentown, PA 726,651 6,343,905 7,070,556 2041 Avenue C Allentown, PA 213,879 1,163,975 1,377,854 2124 Avenue C Allentown, PA 289,529 1,093,852 1,383,381 7339 Industrial Boulevard Allentown, PA 1,197,448 5,637,547 6,834,995 7384 Penn Drive Allentown, PA 652,118 2,696,467 3,348,585 7144 Daniels Drive Allentown, PA 1,579,169 6,572,363 8,151,532 7620 Cetronia Road Allentown, PA 1,093,724 3,970,568 5,064,292 939 Marcon Blvd Allentown, PA 2,220,548 5,258,261 7,478,809 100 Brodhead Road Allentown, PA 429,456 3,080,226 3,509,682 1455 Valley Center Parkway Bethlehem, PA 545,173 3,780,394 4,325,567 1640 Valley Center Parkway Bethlehem, PA 190,728 2,582,488 2,773,216 1650 Valley Center Parkway Allentown, PA 188,896 2,396,077 2,584,973 400 Nestle Way Allentown, PA 8,184,096 26,293,838 34,477,934 83 South Commerce Way Bethlehem, PA 212,744 995,626 1,208,369 85 South Commerce Way Bethlehem, PA 237,078 1,066,365 1,303,443 87 South Commerce Way Bethlehem, PA 253,886 1,138,811 1,392,696 7339 Industrial Blvd Allentown, PA 2,670,673 13,852,476 16,523,149 95 Highland Avenue Bethlehem, PA 430,593 3,460,672 3,891,265 236 Brodhead Road Bethlehem, PA 376,962 4,672,683 5,049,645 6620 Grant Way Allentown, PA 430,824 1,920,164 2,350,988 7562 Penn Drive Allentown, PA 269,614 848,149 1,117,763 7277 Williams Avenue Allentown, PA 462,964 1,456,080 1,919,044 180,190 Cochrane Drive Annapolis, MD 3,752,293 16,047,261 19,799,554 12000,001,040 Indian Creek Court Beltsville, MD 2,698,195 10,031,702 12,729,897 8280 Patuxent Range Drive Columbia, MD 181,601 1,294,623 1,476,224 7178-80 Columbia Gateway Columbia, MD 1,571,105 5,137,364 6,708,469 8730 Bollman Place Columbia, MD 626,269 4,652,665 5,278,934 9770 Patuxent Woods Drive Columbia, MD 341,663 3,037,517 3,379,180 9780 Patuxent Woods Drive Columbia, MD 218,542 1,943,328 2,161,870 9790 Patuxent Woods Drive Columbia, MD 243,791 2,167,132 2,410,923 9810 Patuxent Woods Drive Columbia, MD 266,684 2,370,185 2,636,869 9800 Patuxent Woods Drive Columbia, MD 299,099 2,657,753 2,956,852 9820 Patuxent Woods Drive Columbia, MD 237,779 2,113,763 2,351,542 9830 Patuxent Woods Drive Columbia, MD 296,262 2,632,624 2,928,886 9050 Red Branch Road Columbia, MD 290,950 2,578,253 2,869,203 9101,9111,9115 Guilford Road Columbia, MD 765,953 3,034,462 3,800,415 9125,9135,9145 Guilford Road Columbia, MD 920,439 5,566,828 6,487,267 10 South Third Street Richmond, VA 27,970 173,381 201,351 1751 Bluehills Drive Roanoke, VA 1,063,728 8,602,628 9,666,356 4300 Carolina Avenue Richmond, VA 2,009,136 15,337,786 17,346,923 301 Hill Carter Parkway Richmond, VA 659,456 4,899,214 5,558,670 4001 Carolina Avenue Richmond, VA 29,443 231,348 260,791 5600-5626 Eastport Boulevard Richmond, VA 489,941 3,712,812 4,202,753 5650-5674 Eastport Boulevard Richmond, VA 644,384 4,158,230 4,802,614 5700 Eastport Boulevard Richmond, VA 408,729 2,740,967 3,149,696 11020 Hull Street Road Richmond, VA 139,887 646,199 786,086 3432 Holland Road Virginia Beach, VA 173,527 801,603 975,130 3001 Hungary Springs Road Richmond, VA 136,270 605,069 741,339 7760 Shrader Road Richmond, VA 187,971 773,504 961,475 7740 Shrader Road Richmond, VA 81,200 407,972 489,172 4880 Cox Road Richmond, VA 743,898 5,664,973 6,408,871 5162 Valleypointe Parkway Roanoke, VA 551,483 2,647,549 3,199,032 4101- 4127 Carolina Avenue Richmond, VA 310,854 2,325,262 2,636,116 4201-4261 Carolina Avenue Richmond, VA 693,203 5,200,664 5,893,867 4263-4299 Carolina Avenue Richmond, VA 256,203 2,706,017 2,962,220 4301-4335 Carolina Avenue Richmond, VA 223,696 1,756,663 1,980,359 4337-4379 Carolina Avenue Richmond, VA 325,203 2,708,253 3,033,456 4501-4549 Carolina Avenue Richmond, VA 486,166 3,666,303 4,152,469 4551-4593 Carolina Avenue Richmond, VA 474,360 3,564,260 4,038,620 4601-4643 Carolina Avenue Richmond, VA 652,455 5,052,828 5,705,283 4545-4583 Carolina Avenue Richmond, VA 404,616 3,764,453 4,169,069 4447-4491 Carolina Avenue Richmond, VA 454,056 2,792,858 3,246,914 4401-4445 Carolina Avenue Richmond, VA 615,038 4,586,058 5,201,096 12 S. Third Street Richmond, VA 40,539 190,807 231,346 9601 Cosner Drive Fredericksburg, VA 476,262 4,065,136 4,541,398 315 Cardiff Valley Road Knoxville, TN 443,305 2,993,390 3,436,695 2300 East Parham Road Richmond, VA 221,947 1,025,269 1,247,216 1347 Diamond Springs Road Virginia Beach, VA 436,898 3,285,338 3,722,236 5221 Valleypark Drive - Bldg A Roanoke, VA 285,008 1,222,705 1,507,713 5228 Valleypointe Parkway - Bldg B Roanoke, VA 218,663 893,385 1,112,048 5238 Valleypark Drive - Bldg C Roanoke, VA 416,375 1,988,562 2,404,937 5601-5659 Eastport Boulevard Richmond, VA 720,100 4,700,314 5,420,413 5900 Eastport Boulevard Richmond, VA 687,898 4,405,021 5,092,919 4717-4729 Eubank Road Richmond, VA 452,263 3,380,356 3,832,619 5251 Concourse Drive Roanoke, VA 217,690 1,537,383 1,755,073 4263F-N. Carolina Ave Richmond, VA 91,599 1,622,583 1,714,183 4200 Oakleys Court Richmond, VA 459,653 2,499,114 2,958,767 1821 Battery Dantzler Road Chester, VA 392,332 3,055,327 3,447,658 5000 Cox Road Glen Allen, VA 771,029 3,713,177 4,484,206 510 Eastpark Court Sandston, VA 262,210 2,147,777 2,409,987 520 Eastpark Court Sandston, VA 486,598 4,130,906 4,617,504 600 Liberty Way Chesterfield, VA 502,382 4,884,026 5,386,408 500 Liberty Way Chesterfield, VA 491,919 4,152,094 4,644,013 4198 Cox Road Glen Allen, VA 670,292 3,839,245 4,509,537 4510 Cox Road Glen Allen, VA 1,010,024 7,488,280 8,498,304 88 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE - Continued 2809 South Lynnhaven Road Virginia Beach, VA 953,590 6,150,257 7,103,847 200 Golden Oak Court Virginia Beach, VA 1,116,693 6,779,282 7,895,975 208 Golden Oak Court Virginia Beach, VA 965,177 6,736,323 7,701,500 1 Enterprise Parkway Hampton, VA 974,675 5,587,553 6,562,228 22 Enterprise Parkway Hampton, VA 1,097,368 6,769,420 7,866,788 4523 Green Point Drive High Point, NC 223,614 1,933,947 2,157,561 4501 Green Point Drive High Point, NC 320,450 2,212,040 2,532,490 4500 Green Point Drive High Point, NC 231,692 1,993,560 2,225,252 2427 Penny Road High Point, NC 1,168,074 6,184,618 7,352,692 4524 Green Point Drive High Point, NC 183,888 2,103,328 2,287,216 4328, 4336 Federal Drive High Point, NC 825,092 7,340,082 8,165,174 200 Centreport Drive Greensboro, NC 332,017 4,012,141 4,344,158 4344 Federal Drive High Point, NC 173,623 2,634,555 2,808,178 202 Centreport Drive Greensboro, NC 549,679 5,509,790 6,059,469 4000 Piedmont Parkway High Point, NC 592,885 4,962,473 5,555,358 4380 Federal Drive High Point, NC 283,368 2,033,889 2,317,258 4388 Federal Drive High Point, NC 132,655 1,130,117 1,262,771 6532 Judge Adams Road Rock Creek, NC 399,988 3,459,676 3,859,664 3860 Faber Place N. Charleston, SC 796,655 1,974,359 2,771,014 4055 Faber Place N. Charleston, SC 882,352 4,794,144 5,676,496 3820 Faber Place N. Charleston, SC 506,558 2,365,146 2,871,704 440 Knox Abbott Drive Cayce, SC 576,767 3,448,352 4,025,119 Alcoa Fujikura Facility Duncan, SC 711,353 8,056,324 8,767,677 1320 Garlington Road Greenville, SC 398,539 1,761,533 2,160,072 9800 Twin Lakes Parkway Charlotte, NC 420,079 2,152,047 2,572,126 420 Park Avenue Greenville, SC 522,548 3,006,148 3,528,696 111 Southchase Blvd. Fountain Inn, SC 499,065 4,861,899 5,360,964 300 International Blvd. Fountain Inn, SC 180,560 639,305 819,865 1208 Eastchester Drive High Point, NC 487,209 4,365,146 4,852,355 One Independence Pointe Greenville, SC 780,881 6,215,187 6,996,068 55 Beattie Place Greenville, SC 2,643,105 23,459,278 26,102,383 75 Beattie Place Greenville, SC 2,406,646 17,418,705 19,825,351 1730 Stebbins Drive Houston, TX 144,016 412,656 556,672 5911-5925 Richard Street Jacksonville, FL 286,335 497,306 783,641 8383-8385 Baycenter Road Jacksonville, FL 65,329 525,694 591,023 8775 Baypine Road Jacksonville, FL 913,264 2,886,335 3,799,599 8539 Western Way Jacksonville, FL 631,558 2,823,712 3,455,270 6255 Lake Gray Boulevard Jacksonville, FL 811,963 3,294,525 4,106,488 6600-6660 Suemac Place Jacksonville, FL 216,014 1,886,261 2,102,275 6800-6850 Suemac Place Jacksonville, FL 125,576 973,671 1,099,247 8665,8667,8669 Baypine Road Jacksonville, FL 1,023,514 3,854,512 4,878,026 8540 Baycenter Road Jacksonville, FL 450,431 1,366,708 1,817,139 1200 Gulf Life Drive Jacksonville, FL 1,035,091 16,759,300 17,794,391 8400 Baymeadows Way Jacksonville, FL 566,370 2,323,186 2,889,556 8614 Baymeadows Way Jacksonville, FL 312,761 1,088,410 1,401,171 5941-5975 Richard Street Jacksonville, FL 585,280 1,111,567 1,696,847 7970 Bayberry Road Jacksonville, FL 129,979 1,197,124 1,327,103 6000-6030 Bowdendale Avenue Jacksonville, FL 275,475 1,513,480 1,788,955 7898 Baymeadows Way Jacksonville, FL 568,005 1,966,127 2,534,132 5977-6607 Richard Street Jacksonville, FL 182,747 1,562,967 1,745,714 7910 & 7948 Baymeadows Way Jacksonville, FL 211,449 2,677,564 2,889,013 7954 & 7960 Baymeadows Way Jacksonville, FL 292,667 2,978,826 3,271,493 8787 Baypine Road Jacksonville, FL 2,045,574 34,536,694 36,582,268 7077 Bonneval Road Jacksonville, FL 774,020 6,566,676 7,340,696 4190 Belfort Road Jacksonville, FL 827,420 6,867,187 7,694,607 8011, 8021, 8031 Phillips Highway Jacksonville, FL 628,437 3,958,206 4,586,643 7020 AC Skinner Parkway Jacksonville, FL 749,811 2,150,255 2,900,066 7040 AC Skinner Parkway Jacksonville, FL 853,981 2,963,746 3,817,726 11777 Central Highway Jacksonville, FL 192,004 1,818,777 2,010,781 7016 AC Skinner Parkway Jacksonville, FL 602,633 2,320,994 2,923,626 7018 AC Skinner Parkway Jacksonville, FL 846,433 4,000,189 4,846,621 6620 Southpoint Drive Jacksonville, FL 614,602 4,442,853 5,057,455 7980 Bayberry Road Jacksonville, FL 330,726 1,341,221 1,671,947 9600 Satellite Boulevard Orlando, FL 252,850 1,305,541 1,558,391 9700 Satellite Boulevard Orlando, FL 405,362 1,154,163 1,559,525 1902 Cypress Lake Drive Orlando, FL 523,512 3,401,938 3,925,450 8250 & 8256 Exchange Place Orlando, FL 622,413 2,534,413 3,156,826 6600 Southpoint Parkway Jacksonville, FL 998,432 4,068,675 5,067,107 6700 Southpoint Parkway Jacksonville, FL 620,719 3,187,347 3,808,066 4801 Executive Park Court - 100 Jacksonville, FL 554,542 4,572,699 5,127,241 4801 Executive Park Court - 200 Jacksonville, FL 370,039 1,950,468 2,320,507 4810 Executive Park Court Jacksonville, FL 370,039 1,950,468 2,320,507 6602 Executive Park Court - 100 Jacksonville, FL 388,541 2,047,991 2,436,532 6602 Executive Park Court - 200 Jacksonville, FL 296,032 1,560,374 1,856,406 6631 Executive Park Court - 100 Jacksonville, FL 251,627 1,326,318 1,577,945 6631 Executive Park Court - 200 Jacksonville, FL 407,043 2,145,514 2,552,557 4815 Executive Park Court - 100 Jacksonville, FL 366,339 1,930,963 2,297,302 4815 Executive Park Court - 200 Jacksonville, FL 462,549 2,438,084 2,900,633 4825 Executive Park Court Jacksonville, FL 601,314 3,169,509 3,770,823 4820 Executive Park Court Jacksonville, FL 555,213 2,625,550 3,180,763 10511 & 10611 Satellite Boulevard Orlando, FL 517,554 2,571,942 3,089,496 1400-1440 Central Florida Parkway Orlando, FL 518,043 2,566,496 3,084,539 4001,4051,4101 Fowler Avenue Tampa, FL 1,293,206 4,661,074 5,954,280 5501-5502 Pioneer Park Boulevard Tampa, FL 262,416 1,730,428 1,992,844 5690-5694 Crenshaw Street Tampa, FL 181,923 1,842,980 2,024,903 3102,3104,3110 Cherry Palm Drive Tampa, FL 503,767 2,831,411 3,335,178 8401-8408 Benjamin Road Tampa, FL 789,652 4,691,528 5,481,180 3501 Riga Blvd Tampa, FL 617,289 3,049,755 3,667,044 111 Kelsey Land Tampa, FL 359,540 1,509,725 1,869,265 7930, 8010-20 Woodland Center Tampa, FL 1,408,478 5,247,246 6,655,724 7920 Woodland Center Boulevard Tampa, FL 1,382,648 2,838,862 4,221,510 8154-8198 Woodland Center Tampa, FL 399,088 2,868,834 3,267,922 8112-42 Woodland Center Tampa, FL 513,263 3,230,239 3,743,502 89 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- OPERATING REAL ESTATE - Continued 8212 Woodland Center Tampa, FL 820,882 2,579,475 3,400,357 1701 Clint Moore Blvd Boca Raton, FL 1,430,884 3,056,086 4,486,970 4555 Riverside Drive Beach Gardens, FL 805,672 5,788,766 6,594,438 2500 Metrocentre Boulevard West Palm Beach, FL 238,362 1,536,721 1,775,083 2540 Metrocenter Boulevard West Palm Beach, FL 165,071 1,059,970 1,225,041 2541 Metrocentre Boulevard West Palm Beach, FL 145,091 936,094 1,081,185 2580 Metrocentre Boulevard West Palm Beach, FL 256,478 1,653,533 1,910,011 2581 Metrocentre Boulevard West Palm Beach, FL 189,359 1,220,568 1,409,927 5410 - 5430 Northwest 33rd Avenue Ft. Lauderdale, FL 603,776 4,180,719 4,784,495 2905 Northwest Boulevard Plymouth, MN 516,920 4,757,980 5,274,900 2800 Campus Drive Plymouth, MN 395,366 3,692,714 4,088,080 2955 Xenium Lane Plymouth, MN 151,238 1,379,653 1,530,891 9401-9443 Science Center Drive New Hope, MN 431,295 3,926,207 4,357,502 6321-6325 Bury Drive Eden Prairie, MN 462,876 4,166,578 4,629,454 7115-7173 Shady Oak Road Eden Prairie, MN 454,974 4,138,741 4,593,715 7660-7716 Golden Triangle Drive Eden Prairie, MN 568,706 5,105,565 5,674,271 7400 Flying Cloud Drive Eden Prairie, MN 195,982 1,762,027 1,958,009 330 Second Avenue Minneapolis, MN 2,168,572 13,608,048 15,776,621 10301-10305 West 70th Street Eden Prairie, MN 120,622 1,156,790 1,277,412 10321 West 70th Street Eden Prairie, MN 145,198 1,337,090 1,482,288 10333 West 70th Street Eden Prairie, MN 110,746 1,022,867 1,133,613 10349-10357 West 70th Street Eden Prairie, MN 275,903 2,736,992 3,012,895 10365-10375 West 70th Street Eden Prairie, MN 291,077 2,632,464 2,923,541 10393-10394 West 70th Street Eden Prairie, MN 269,618 2,647,513 2,917,132 7078 Shady Oak Road Eden Prairie, MN 343,093 3,088,933 3,432,026 5600 & 5610 Rowland Road Minnetonka, MN 828,650 7,452,441 8,281,091 2920 Northwest Boulevard Plymouth, MN 392,026 3,459,945 3,851,971 26911-26957 Northwestern Southfield, MI 11,416,220 66,268,817 77,685,037 1650 Research Drive Troy, MI 763,067 7,240,849 8,003,916 1775 Research Drive Troy, MI 331,422 2,825,747 3,157,169 1875 Research Drive Troy, MI 329,863 2,811,681 3,141,544 1850 Research Drive Troy, MI 781,054 7,404,371 8,185,425 1965 Research Drive Troy, MI 419,090 3,616,603 4,035,693 1960 Research Drive Troy, MI 419,146 3,616,841 4,035,987 27260 Haggerty Road Farmington Hills, MI 456,877 4,104,941 4,561,818 27200 Haggerty Road Farmington Hills, MI 382,754 3,434,318 3,817,072 27280 Haggerty Road Farmington Hills, MI 452,860 4,067,692 4,520,552 27220 Haggerty Road Farmington Hills, MI 203,064 1,813,399 2,016,463 27240 Haggerty Road Farmington Hills, MI 171,518 1,528,882 1,700,400 27300 Haggerty Road Farmington Hills, MI 370,378 3,334,999 3,705,377 1101 Allen Drive Troy, MI 98,144 893,368 991,512 1151 Allen Drive Troy, MI 164,483 1,493,391 1,657,874 1300 Rankin Street Troy, MI 134,090 1,212,839 1,346,929 1350 Rankin Street Troy, MI 111,776 1,011,570 1,123,346 1376-1400 Rankin Street Troy, MI 134,292 1,230,846 1,365,138 1352-1374 Rankin Street Troy, MI 153,275 1,386,279 1,539,554 1324-1346 Rankin Street Troy, MI 134,090 1,213,243 1,347,333 1301-1307 Rankin Street Troy, MI 111,776 1,011,974 1,123,750 1409 Allen Drive Troy, MI 142,370 1,301,421 1,443,791 1304 E Maple Road Troy, MI 211,233 1,908,428 2,119,661 1334 Maplelawn Road Troy, MI 124,296 1,123,762 1,248,058 1290 Maplelawn Road Troy, MI 85,321 772,274 857,595 1070 Maplelawn Road Troy, MI 68,560 621,115 689,675 950 Maplelawn Road Troy, MI 252,429 2,278,097 2,530,526 894 Maplelawn Road Troy, MI 181,749 1,641,477 1,823,226 1179 Maplelawn Road Troy, MI 87,845 795,038 882,883 1940 Norwood Drive Troy, MI 86,836 785,933 872,769 1311-1331 Maplelawn Road Troy, MI 125,407 1,133,779 1,259,186 2354 Bellingham Street Troy, MI 87,340 790,487 877,827 2360 Bellingham Street Troy, MI 87,340 790,487 877,827 1911 Ring Drive Troy, MI 86,129 779,559 865,688 26442-26450 Haggerty Road Farmington Hills, MI 237,687 2,151,202 2,388,889 26500 Haggerty Road Farmington Hills, MI 311,093 2,818,580 3,129,673 26650 Haggerty Road Farmington Hills, MI 173,166 1,569,915 1,743,081 26700 Haggerty Road Farmington Hills, MI 253,338 2,292,637 2,545,975 26750 Haggerty Road Farmington Hills, MI 292,717 2,646,852 2,939,569 26800 Haggerty Road Farmington Hills, MI 175,489 1,590,592 1,766,081 26842-26850 Haggerty Road Farmington Hills, MI 239,606 2,168,211 2,407,817 50 Gibson Drive West Malling, UK - 3,746,462 3,746,462 25 Kings Hill Avenue West Malling, UK 1,291,493 5,465,327 6,756,820 2 Kings Hill Avenue West Malling, UK 845,147 4,769,535 5,614,682 50 Kings Hill Avenue West Malling, UK 1,311,758 13,438,926 14,750,684 ------------ -------------- -------------- Subtotal Operating Real Estate $238,518,514 $1,639,820,930 $1,878,339,444 ============ ============== ============== DEVELOPMENT PROPERTIES 132 Welsh Road Horsham, PA $ 1,408,042 $ 3,031,677 $ 4,439,719 3604 Horizon Blvd King of Prussia, PA 350,873 1,881,665 2,232,538 100 Cedar Hollow Road Malvern, PA 1,640,999 5,077,180 6,718,179 3 Country View Road Malvern, PA 1,128,279 2,183,205 3,311,484 425 Technology Drive Malvern, PA 321,473 1,101,236 1,422,709 375 Technology Drive Malvern, PA 234,922 205,474 440,396 100 Chesterfield Pkwy Malvern, PA 1,349,954 860,442 2,210,396 201 Berkeley Drive Bridgeport, NJ 273,915 1,080,677 1,354,591 300 Commodore Drive Bridgeport, NJ 593,492 1,610,632 2,204,124 1660 Valley Center Parkway Bethlehem, PA 188,721 1,819,127 2,007,848 89 South Commerce Way Bethlehem, PA 368,019 1,353,514 1,721,533 1525 Valley Ctr Pkwy Allentown, PA 804,060 3,601,914 4,405,974 700 Nestle Way Allentown, PA 4,174,970 15,327,585 19,502,555 5500 Cox Road Richmond, VA 483,778 1,416,596 1,900,374 13001 Kingston Ave Richmond, VA 376,700 1,723,151 2,099,851 90 Gross Amount Carried At Close of Period ------------------------------------------- Land and Building and Total Project City Improvements Improvements @ 12/31/97 - -------------------------------------- ------------------- ------------ -------------- -------------- DEVELOPMENT PROPERTIES - Continued 5701-5799 Eastport Blvd Richmond, VA 700,503 4,718,742 5,419,245 4801 Cox Road Richmond, VA 1,075,620 3,209,545 4,285,165 701 Liberty Way Richmond, VA 543,260 3,230,669 3,773,929 5310 Valley Park Drive Roanoke, VA 127,361 551,185 678,546 5305 Valley Park Drive Roanoke, VA 228,124 642,427 870,551 530 Eastpark Court Sandston, VA 333,597 1,056,066 1,389,663 101 Centreport Greensboro, NC 826,237 5,225,165 6,051,402 6532 Judge Adams Road Whitsett, NC 335,061 3,135,245 3,470,306 3875 Faber Place N. Charleston, SC 1,166,052 5,391,988 6,558,040 1 Alliance Drive Goose Creek, SC 662,422 1,468,894 2,131,316 1150 Northpoint Blvd Blythwood, SC 741,692 1,348,001 2,089,693 4160 Mendenhall Oaks Pkwy High Point, NC 544,945 2,363,696 2,908,641 4194 Mendenhall Oaks Pkwy High Point, NC 265,887 1,215,193 1,481,080 4196 Mendenhall Oaks Pkwy High Point, NC 173,785 1,106,704 1,280,489 4170 Mendenhall Oaks Pkwy High Point, NC 372,849 1,196,531 1,569,380 4180 Mendenhall Oaks Pkwy High Point, NC 314,960 997,399 1,312,359 7720 Mendenhall Oaks Pkwy High Point, NC 1,995,876 8,019,073 10,014,949 4345 Southpoint Parkway Jacksonville, FL 418,093 7,326,703 7,744,796 131 Silo Bend Tampa, FL 559,435 1,739,513 2,298,947 7724 Woodland Ctr Blvd Tampa, FL 235,894 503,830 739,724 7802-50 Woodland Ctr Blvd Tampa, FL 357,364 676,414 1,033,778 7852-98 Woodland Ctr Blvd Tampa, FL 357,364 725,779 1,083,143 8921 Brittany Way Tampa, FL 252,230 125,468 377,698 6601-6625 W. 78th Street Bloomington, MN 2,303,774 13,289,972 15,593,746 10400 Southwest Crossing Eden Prairie, MN 2,998,225 1,719,522 4,717,747 10 Kings Hill Ave West Malling, UK 983,547 3,008,337 3,991,884 30 Tower View West Malling, UK 1,657,321 2,546,004 4,203,325 35 Kings Hill Ave West Malling, UK 812,193 2,239,449 3,051,642 ------------- -------------- -------------- Subtotal Development in Progress $ 35,041,868 $ 121,051,587 $ 156,093,455 ============= ============== ============== LAND HELD FOR DEVELOPMENT Chelsea Business Park Land Boothwyn, PA 1,896,888 - 1,896,888 Gwynedd North Bus Camp Land Lansdale, PA 257,945 - 257,945 Three Country View Road Malvern, PA - 6,177 6,177 550 Lapp Road Malvern, PA - 2,575 2,574 Cedar Hollow Road Land Malvern, PA - - - Walnut Grove Land Horsham, PA 3,938,855 - 3,938,855 Iron Run Land Upper Macungie, PA 788,281 - 788,281 35 Liberty Blvd Land Malvern, PA - - - 45 Liberty Blvd Land Malvern, PA 4,579,317 - 4,579,317 Great Valley Land Malvern, PA 4,905,740 - 4,905,740 10 Matthews Rd South Land Malvern, PA 608,995 - 608,995 104 Witmer Road Horsham, PA 1,248,148 - 1,248,148 3 Franklin Plaza Philadelphia, PA 2,503,348 - 2,503,348 2700 Horizon Dr King of Prussia, PA 767,949 - 767,949 2900 Horizon Dr King of Prussia, PA 682,621 - 682,621 2500 Renaissance Blvd King of Prussia, PA 511,967 - 511,967 2300 Renaissance Blvd King of Prussia, PA 511,967 - 511,967 Swedes Run Business Park Land Delran, NJ 1,615,405 - 1,615,405 Marlton Crossing Land Marlton, NJ 239,746 10,749 250,496 Commodore Business Park Logan Twp., NJ 4,363,233 20,451 4,383,684 Boulden Land New Castle, DE - - - Marlton Executive Park Land Marlton, NJ 765,862 - 765,862 17 Boulden Circle New Castle, DE 386,057 301,414 687,471 1015 Briggs Road Land Mt. Laurel, NJ 373,373 - 373,373 1020 Briggs Road Land Mt. Laurel, NJ 533,259 - 533,259 Lehigh Valley Corporate Center Land Bethlehem, PA 1,249,539 60,449 1,309,988 Rivers' Bend Land Chesterfield Cty, VA 3,026,870 5,433,211 8,460,081 Oakleys Center Land Richmond, VA 286,142 - 286,142 Woodlands Center Land Sandston, VA 1,276,171 - 1,276,171 501 Liberty Way Chesterfield City, VA 597,995 - 597,995 601 Hewlett Packard Way Chesterfield City, VA 606,692 - 606,692 6000-98 Eastport Blvd Richmond, VA 787,091 - 787,091 Eastport VIII Richmond, VA 379,836 - 379,836 Eastport IX Richmond, VA 209,856 - 209,856 Park at Valleypointe Land Roanoke, VA 640,121 4,722 644,842 Fairgrounds Distribution Center Land Richmond, VA 129,107 1,197 130,304 Mendenhall Land High Point, NC 4,006,549 7,858 4,014,407 Independence Pointe Land Greenville, SC 1,318,939 - 1,318,939 Southpoint Business Park Land Jacksonville, FL 438,086 - 438,086 Liberty Business Park Land Jacksonville, FL 2,004,862 27,561 2,032,423 7024 AC Skinner Parkway Jacksonville, FL 624,483 - 624,483 7014 AC Skinner Pkwy Jacksonville, FL 780,486 - 780,486 Silo Bend Land Tampa, FL 4,612,621 - 4,612,620 Cypress Park Land Orlando, FL 529,934 - 529,934 Exchange Place Land Orlando, FL 202,117 - 202,117 Airport West Tampa, FL - 482 481 West Tech Park Land (Lot B) Farmington Hills, MI 461,341 3,852 465,193 West Tech Park Land (Lot C) Farmington Hills, MI 370,485 5,117 375,602 ------------ -------------- -------------- Subtotal Land Held for Development $ 56,018,279 $ 5,885,815 $ 61,904,094 ============ ============== ============== Total All Properties $329,578,661 $1,766,758,332 $2,096,336,993 ============ ============== ============== * Denotes property is collateralized under mortgages with Nationwide, Principal Mutual, American General and Jackson National Life totalling $246.2 million. ** Rouse leases land from Kent County Council.
91 LIBERTY PROPERTY LIMITED PARTNERSHIP REAL ESTATE AND ACCUMULATED DEPRECIATION AS OF DECEMBER 31, 1997
Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE 10,20 Liberty Boulevard Malvern, PA 919,946 1985 40 yrs. 420 Lapp Road Malvern, PA 1,126,400 1989 40 yrs. 1 Chelsea Parkway Boothwyn, PA 634,371 1989 40 yrs. 3 Chelsea Parkway Boothwyn, PA 550,687 1989 40 yrs. 747 Dresher Road Horsham, PA 795,626 1988 40 yrs. 45-67 Great Valley Parkway Malvern, PA 1,420,325 1974 40 yrs. 1180 Church Road Lansdale, PA 3,656,856 1986 40 yrs. 40 Valley Stream Parkway Malvern, PA 555,883 1987 40 yrs. 50 Valley Stream Parkway Malvern, PA 624,310 1987 40 yrs. 20 Valley Stream Parkway Malvern, PA 1,225,543 1987 40 yrs. 800 Town Center Drive Langhorne, PA 2,154,770 1987 40 yrs. 1610 Medical Drive Pottstown, PA 639,027 1986 40 yrs. 9, 15 Great Valley Parkway Malvern, PA 7,619,067 1986 40 yrs. 257-275 Great Valley Parkway Malvern, PA 1,402,123 1983 40 yrs. 300 Technology Drive Malvern, PA 342,683 1985 40 yrs. 277-293 Great Valley Parkway Malvern, PA 611,676 1984 40 yrs. 311 Technology Drive Malvern, PA 660,877 1984 40 yrs. 325 Technology Drive Malvern, PA 548,649 1984 40 yrs. 7 Great Valley Parkway Malvern, PA 1,226,412 1985 40 yrs. 55 Valley Stream Parkway Malvern, PA 902,087 1983 40 yrs. 65 Valley Stream Parkway Malvern, PA 1,419,757 1983 40 yrs. 508 Lapp Road Malvern, PA 547,917 1984 40 yrs. 10 Valley Stream Parkway Malvern, PA 835,717 1984 40 yrs. 333 Phoenixville Pike Malvern, PA 878,298 1985 40 yrs. 1566 Medical Drive Pottstown, PA 523,204 1985 40 yrs. 30 Great Valley Parkway Malvern, PA 203,079 1975 40 yrs. 75 Great Valley Parkway Malvern, PA 174,422 1977 40 yrs. 27-43 Great Valley Parkway Malvern, PA 944,195 1977 40 yrs. 77-123 Great Valley Parkway Malvern, PA 1,808,402 1978 40 yrs. 260 Great Valley Parkway Malvern, PA 301,673 1979 40 yrs. 256 Great Valley Parkway Malvern, PA 726,954 1980 40 yrs. 205 Great Valley Parkway Malvern, PA 3,445,143 1981 40 yrs. 12,14,16 Great Valley Parkway Malvern, PA 475,765 1982 40 yrs. 155 Great Valley Parkway Malvern, PA 797,405 1981 40 yrs. 333 Technology Drive Malvern, PA 927,197 1987 40 yrs. 510 Lapp Road Malvern, PA 325,910 1983 40 yrs. 181 Wheeler Court Langhorne, PA 174,990 1979 40 yrs. 1100 Wheeler Way Langhorne, PA 101,879 1979 40 yrs. 60 Morehall Road Malvern, PA 858,560 1989 40 yrs. 905 Airport Road West Chester, PA 494,974 1988 40 yrs. 16 Cabot Boulevard Langhorne, PA 493,741 1972 40 yrs. 1 Country View Road Malvern, PA 319,213 1982 40 yrs. 2151 Cabot Boulevard Langhorne, PA 290,898 1982 40 yrs. 170 South Warner Road King of Prussia, PA 748,252 1980 40 yrs. 190 South Warner Road King of Prussia, PA 418,560 1980 40 yrs. 507 Prudential Road Horsham, PA 450,511 1988 40 yrs. 100 Witmer Road Horsham, PA 390,055 1995 40 yrs. 3100 Horizon Blvd King of Prussia, PA 107,994 1995 40 yrs. 3300 Horizon Blvd King of Prussia, PA 174,718 1996 40 yrs. 3500 Horizon Blvd King of Prussia, PA 111,087 1996 40 yrs. 200 Chester Field Parkway Malvern, PA 1,205,217 1989 40 yrs. 767 Electronic Drive Horsham, PA 239,158 1996 40 yrs. 5 Country View Road Malvern, PA 277,065 1985 40 yrs. 3200 Horizon Blvd King of Prussia, PA 176,009 1996 40 yrs. 3000 Horizon Boulevard King of Prussia, PA 29,807 1997 40 yrs. 111-195 Witmer Road Horsham, PA 131,498 1996 40 yrs. 300 Welsh Road Horsham, PA 65,448 1983 40 yrs. 400 Welsh Road Horsham, PA 117,235 1983 40 yrs. 8801 Tinicum Boulevard Philadelphia, PA 117,996 1997 40 yrs. 440 East Swedesford Road King of Prussia, PA 325,940 1988 40 yrs. 460 East Swedesford Road King of Prussia, PA 217,436 1988 40 yrs. 50 Morehall Road Malvern, PA 187,593 1997 40 yrs. 2 Walnut Grove Drive Horsham, PA 254,125 1989 40 yrs. 200 Gibralter Road Horsham, PA 146,902 1990 40 yrs. 220 Gibralter Road Horsham, PA 143,548 1990 40 yrs. 240 Gibralter Road Horsham, PA 143,546 1990 40 yrs. 151 S. Warner Road King of Prussia, PA 175,497 1980 40 yrs. 1 Walnut Grove Drive Horsham, PA 227,236 1986 40 yrs. 3606 Horizon Boulevard King of Prussia, PA 31,917 1997 40 yrs. 650 Swedesford Road King of Prussia, PA 184,063 1971 40 yrs. 680 Swedesford Road King of Prussia, PA 268,001 1971 40 yrs. 761 Fifth Avenue King of Prussia, PA 17,366 1977 40 yrs. 771 Fifth Avenue King of Prussia, PA 8,496 1977 40 yrs. 1 Great Valley Parkway Malvern, PA 49,348 1982 40 yrs. 5 Great Valley Parkway Malvern, PA 79,285 1983 40 yrs. 311 Sinclair Road Bristol, PA 3,314 1997 40 yrs. 181-187 Gibralter Road Horsham, PA 8,269 1982 40 yrs. 104 Rock Road Horsham, PA 6,231 1974 40 yrs. 123-135 Rock Road Horsham, PA 5,493 1975 40 yrs. 111-159 Gibralter Road Horsham, PA 9,188 1981 40 yrs. 161-175 Gibralter Road Horsham, PA 6,799 1976 40 yrs. 125-137 Gibralter Road Horsham, PA 6,016 1978 40 yrs. 261-283 Gibralter Road Horsham, PA 9,297 1978 40 yrs. 210-223 Witmer Road Horsham, PA 5,172 1972 40 yrs. 231-237 Gibralter Road Horsham, PA 9,524 1981 40 yrs. 100 Gibralter Road Horsham, PA 728 1975 40 yrs. 101 Gibralter Road Horsham, PA 12,249 1977 40 yrs. 506 Prudential Road Horsham, PA 1,863 1973 40 yrs. 113-123 Rock Road Horsham, PA 23 1975 40 yrs. 92 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE - Continued 101-111 Rock Road Horsham, PA 6,586 1975 40 yrs. 120 Gibralter Road Horsham, PA 10,627 1980 40 yrs. 110 Gibralter Road Horsham, PA 10,766 1979 40 yrs. 100-107 Lakeside Drive Horsham, PA 4,500 1982 40 yrs. 200-264 Lakeside Drive Horsham, PA 10,917 1982 40 yrs. 300-309 Lakeside Drive Horsham, PA 6,806 1982 40 yrs. 400-445 Lakeside Drive Horsham, PA 10,213 1981 40 yrs. 201 Gibralter Road Horsham, PA 10,262 1983 40 yrs. 3600 Horizon Drive King of Prussia, PA 4,568 1989 40 yrs. 3602 Horizon Drive King of Prussia, PA 3,048 1989 40 yrs. 400-500 Brandywine Parkway West Chester, PA 14,292 1988 40 yrs. 600 Brandywine Parkway West Chester, PA 11,234 1988 40 yrs. 14 Lee Boulevard Malvern, PA 1,060,763 1988 40 yrs. 500 Chester Field Parkway Malvern, PA 611,087 1988 40 yrs. 300-400 Chester Field Parkway Malvern, PA 953,654 1988 40 yrs. 1805 Underwood Boulevard Delran, NJ 125,855 1973 40 yrs. 150 Mid-Atlantic Parkway West Deptford, NJ 213,878 1973 40 yrs. 18 Boulden Circle New Castle, DE 715,037 1989 40 yrs. 501 Delran Parkway Delran, NJ 578,788 1988 40 yrs. 600 Delran Parkway Delran, NJ 1,208,318 1988 40 yrs. 1607 Imperial Way West Deptford, NJ 996,321 1973 40 yrs. 1 Boulden Circle New Castle, DE 340,173 1986 40 yrs. 31-55 Read's Way New Castle, DE 1,315,111 1986 40 yrs. 3 Boulden Circle New Castle, DE 481,109 1987 40 yrs. 5 Boulden Circle New Castle, DE 738,560 1987 40 yrs. 601 Delran Parkway Delran, NJ 389,016 1988 40 yrs. 51 Haddonfield Road Cherry Hill, NJ 2,358,397 1986 40 yrs. 57 Read's Way New Castle, DE 753,222 1985 40 yrs. 1370 Imperial Way West Deptford, NJ 394,067 1978 40 yrs. 8 Stow Road Marlton, NJ 185,812 1988 40 yrs. 10 Stow Road Marlton, NJ 127,341 1988 40 yrs. 12 Stow Road Marlton, NJ 141,346 1988 40 yrs. 14 Stow Road Marlton, NJ 155,328 1988 40 yrs. 1300 Metropolitan Avenue West Deptford, NJ 163,730 1972 40 yrs. 701A Route 73 South Marlton, NJ 627,663 1987 40 yrs. 701C Route 73 South Marlton, NJ 135,403 1987 40 yrs. 1008 Astoria Boulevard Cherry Hill, NJ 88,409 1973 40 yrs. 1475 Imperial Way West Deptford, NJ 82,047 1976 40 yrs. 3000 Atrium Way Mt. Laurel, NJ 1,202,865 1987 40 yrs. 750 Cardinal Drive Pureland, NJ 263,249 1989 40 yrs. 11000, 15000, 17000 Commerce Parkway Mt. Laurel, NJ 426,070 1985 40 yrs. 12000, 14000 Commerce Parkway Mt. Laurel, NJ 262,191 1985 40 yrs. 16000, 18000 Commerce Parkway Mt. Laurel, NJ 224,760 1985 40 yrs. 406 Lippincott Drive Marlton, NJ 180,919 1990 40 yrs. 234 High Hill Road Bridgeport, NJ 121,489 1987 40 yrs. 231 Lake Drive New Castle, DE 125,036 1997 40 yrs. 100 Arlington Boulevard Bridgeport, NJ 182,513 1996 40 yrs. 100 Berkeley Drive Swedesboro, NJ 103,730 1990 40 yrs. 301 Lippincott Drive Marlton, NJ 300,240 1988 40 yrs. 303 Lippincott Drive Marlton, NJ 306,844 1988 40 yrs. 510-512 Sharptown Road Bridgeport, NJ 51,547 1984 40 yrs. 901 Route 73 (901 Building) Marlton, NJ 123,231 1985 40 yrs. Four Greentree Center Marlton, NJ 142,332 1988 40 yrs. 512 Sharptown Road Bridgeport, NJ 66,124 1984 40 yrs. 15 Boulden Circle New Castle, DE 21,513 1997 40 yrs. 404 Lippincott Drive Marlton, NJ 18,727 1997 40 yrs. 263 Quigley Blvd New Castle, DE 44,340 1987 40 yrs. 34 Blevins Drive New Castle, DE 48,331 1987 40 yrs. 104 Gaither Drive Mt Laurel, NJ 35,658 1975 40 yrs. 2 Lukens Drive New Castle, DE 38,747 1988 40 yrs. 402 Lippincott Drive Marlton, NJ 35,680 1997 40 yrs. 3000 Lincoln Drive Mt. Laurel, NJ 38,973 1983 40 yrs. 6000 Commerce Parkway Mt. Laurel, NJ 30,988 1985 40 yrs. 7000 Commerce Parkway Mt. Laurel, NJ 33,251 1984 40 yrs. 8000 Commerce Parkway Mt. Laurel, NJ 29,529 1983 40 yrs. 9000 Commerce Parkway Mt. Laurel, NJ 36,656 1983 40 yrs. 1000 Briggs Road Mt. Laurel, NJ 43,768 1986 40 yrs. 1025 Briggs Road Mt. Laurel, NJ 54,644 1987 40 yrs. 2000 Crawford Place Mount Laurel, NJ 23,937 1986 40 yrs. 1351 Metropolitan Avenue Thorofare, NJ 10,748 1986 40 yrs. 650 Grove Road Thorofare, NJ 15,157 1986 40 yrs. 400 Grove Road Thorofare, NJ 8,225 1986 40 yrs. 1655 Valley Center Parkway Bethlehem, PA 186,310 1993 40 yrs. 6560 Stonegate Drive Allentown, PA 472,580 1989 40 yrs. 6370 Hedgewood Drive Allentown, PA 471,598 1990 40 yrs. 6390 Hedgewood Drive Allentown, PA 535,191 1990 40 yrs. 1495 Valley Center Parkway Bethlehem, PA 616,022 1990 40 yrs. 6350 Hedgewood Drive Allentown, PA 617,892 1989 40 yrs. 6330 Hedgewood Drive Allentown, PA 1,079,504 1988 40 yrs. 1550 Valley Center Parkway Bethlehem, PA 587,742 1988 40 yrs. 1560 Valley Center Parkway Bethlehem, PA 747,669 1988 40 yrs. 6580 Snowdrift Road Allentown, PA 571,101 1988 40 yrs. 1510 Valley Center Parkway Bethlehem, PA 690,231 1988 40 yrs. 1530 Valley Center Parkway Bethlehem, PA 550,025 1988 40 yrs. 6540 Stonegate Drive Allentown, PA 793,806 1988 40 yrs. 974 Marcon Boulevard Allentown, PA 542,462 1987 40 yrs. 964 Marcon Street Allentown, PA 461,528 1985 40 yrs. 764 Roble Road Allentown, PA 228,454 1985 40 yrs. 3174 Airport Road Allentown, PA 415,890 1979 40 yrs. 2196 Avenue C Allentown, PA 407,962 1980 40 yrs. 2202 Hanger Place Allentown, PA 480,198 1981 40 yrs. 2201 Hanger Place Allentown, PA 505,872 1987 40 yrs. 954 Marcon Boulevard Allentown, PA 327,217 1981 40 yrs. 57 South Commerce Way Allentown, PA 252,495 1986 40 yrs. 754 Roble Road Allentown, PA 163,612 1986 40 yrs. 93 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE - Continued 894 Marcon Boulevard Allentown, PA 94,747 1986 40 yrs. 744 Roble Road Allentown, PA 176,344 1986 40 yrs. 944 Marcon Boulevard Allentown, PA 151,226 1986 40 yrs. 1685 Valley Center Parkway Allentown, PA 128,571 1996 40 yrs. 6520 Stonegate Drive Allentown, PA 56,527 1996 40 yrs. 7437 Industrial Boulevard Allentown, PA 550,109 1976 40 yrs. 939 Marcon Blvd Allentown, PA 326,256 1980 40 yrs. 1455 Valley Center Parkway Bethlehem, PA 132,683 1997 40 yrs. 1640 Valley Center Parkway Bethlehem, PA 138,901 1996 40 yrs. 1650 Valley Center Parkway Allentown, PA 108,839 1997 40 yrs. Nestle Way Allentown, PA 652,413 1997 40 yrs. 83 South Commerce Way Bethlehem, PA 39,219 1989 40 yrs. 85 South Commerce Way Bethlehem, PA 39,745 1989 40 yrs. 87 South Commerce Way Bethlehem, PA 41,830 1989 40 yrs. 7339 Industrial Blvd Allentown, PA 437,090 1988 40 yrs. 95 Highland Avenue Bethlehem, PA 63,829 1985 40 yrs. 236 Brodhead Road Bethlehem, PA 88,243 1994 40 yrs. 6620 Grant Way Allentown, PA 31,945 1989 40 yrs. 7562 Penn Drive Allentown, PA - 1989 40 yrs. 7277 Williams Avenue Allentown, PA - 1989 40 yrs. 2041 Avenue C Allentown, PA 79,240 1990 40 yrs. 2124 Avenue C Allentown, PA 74,159 1990 40 yrs. 7339 Industrial Boulevard Allentown, PA 152,891 1996 40 yrs. 7384 Penn Drive Allentown, PA 171,693 1988 40 yrs. 7144 Daniels Drive Allentown, PA 332,264 1975 40 yrs. 7620 Cetronia Road Allentown, PA 244,123 1990 40 yrs. 100 Brodhead Road Allentown, PA 170,356 1990 40 yrs. 12000,001,040 Indian Creek Court Beltsville, MD 2,379,638 1986 40 yrs. 8280 Patuxent Range Drive Columbia, MD 538,879 1978 40 yrs. 7178-80 Columbia Gateway Columbia, MD 404,731 1987 40 yrs. 8730 Bollman Place Columbia, MD 325,182 1984 40 yrs. 9770 Patuxent Woods Drive Columbia, MD 50,860 1986 40 yrs. 9780 Patuxent Woods Drive Columbia, MD 32,515 1986 40 yrs. 9790 Patuxent Woods Drive Columbia, MD 36,271 1986 40 yrs. 9810 Patuxent Woods Drive Columbia, MD 39,705 1986 40 yrs. 9800 Patuxent Woods Drive Columbia, MD 44,500 1988 40 yrs. 9820 Patuxent Woods Drive Columbia, MD 35,377 1988 40 yrs. 9830 Patuxent Woods Drive Columbia, MD 44,078 1986 40 yrs. 9050 Red Branch Road Columbia, MD 32,451 1972 40 yrs. 180,190 Cochrane Drive Annapolis, MD 3,116,559 1989 40 yrs. 9101,9111,9115 Guilford Road Columbia, MD 884,484 1984 40 yrs. 9125,9135,9145 Guilford Road Columbia, MD 1,441,850 1983 40 yrs. 1751 Bluehills Drive Roanoke, VA 585,871 1991 40 yrs. 3432 Holland Road Virginia Beach, VA 55,974 1989 40 yrs. 5162 Valleypointe Parkway Roanoke, VA 182,671 1993 40 yrs. 9601 Cosner Drive Fredericksburg, VA 264,939 1995 40 yrs. 315 Cardiff Valley Road Knoxville, TN 215,809 1994 40 yrs. 1347 Diamond Springs Road Virginia Beach, VA 227,173 1980 40 yrs. 5601-5659 Eastport Boulevard Richmond, VA 313,389 1996 40 yrs. 5900 Eastport Boulevard Richmond, VA 102,426 1997 40 yrs. 4717-4729 Eubank Road Richmond, VA 188,346 1978 40 yrs. 5251 Concourse Drive Roanoke, VA 76,296 1997 40 yrs. 4263F-N. Carolina Ave Richmond, VA 61,255 1975 40 yrs. 4200 Oakleys Court Richmond, VA 78,062 1990 40 yrs. 1821 Battery Dantzler Road Chester, VA 94,958 1990 40 yrs. 5000 Cox Road Glen Allen, VA 116,246 1990 40 yrs. 510 Eastpark Court Sandston, VA 67,809 1989 40 yrs. 520 Eastpark Court Sandston, VA 129,139 1989 40 yrs. 600 Liberty Way Chesterfield, VA 72,183 1997 40 yrs. 500 Liberty Way Chester, VA 17,354 1997 40 yrs. 4198 Cox Road Glen Allen, VA 39,736 1984 40 yrs. 4510 Cox Road Glen Allen, VA 63,266 1990 40 yrs. 2809 South Lynnhaven Road Virginia Beach, VA - 1987 40 yrs. 200 Golden Oak Court Virginia Beach, VA - 1988 40 yrs. 208 Golden Oak Court Virginia Beach, VA - 1989 40 yrs. 1 Enterprise Parkway Hampton, VA - 1987 40 yrs. 22 Enterprise Parkway Hampton, VA - 1990 40 yrs. 10 South Third Street Richmond, VA 10,765 1930 40 yrs. 4300 Carolina Avenue Richmond, VA 1,059,655 1985 40 yrs. 301 Hill Carter Parkway Richmond, VA 342,413 1989 40 yrs. 4001 Carolina Avenue Richmond, VA 19,694 1935 40 yrs. 5600-5626 Eastport Boulevard Richmond, VA 273,614 1989 40 yrs. 5650-5674 Eastport Boulevard Richmond, VA 315,412 1990 40 yrs. 5700 Eastport Boulevard Richmond, VA 197,975 1990 40 yrs. 11020 Hull Street Road Richmond, VA 45,126 1987 40 yrs. 3001 Hungary Springs Road Richmond, VA 43,201 1984 40 yrs. 7760 Shrader Road Richmond, VA 55,899 1987 40 yrs. 7740 Shrader Road Richmond, VA 33,409 1989 40 yrs. 4880 Cox Road Richmond, VA 154,055 1995 40 yrs. 4101- 4127 Carolina Avenue Richmond, VA 161,574 1973 40 yrs. 4201-4261 Carolina Avenue Richmond, VA 364,722 1975 40 yrs. 4263-4299 Carolina Avenue Richmond, VA 185,656 1976 40 yrs. 4301-4335 Carolina Avenue Richmond, VA 118,526 1978 40 yrs. 4337-4379 Carolina Avenue Richmond, VA 176,804 1979 40 yrs. 4501-4549 Carolina Avenue Richmond, VA 253,345 1981 40 yrs. 4551-4593 Carolina Avenue Richmond, VA 261,401 1982 40 yrs. 4601-4643 Carolina Avenue Richmond, VA 386,893 1985 40 yrs. 4545-4583 Carolina Avenue Richmond, VA 588,974 1985 40 yrs. 4447-4491 Carolina Avenue Richmond, VA 207,280 1987 40 yrs. 4401-4445 Carolina Avenue Richmond, VA 319,560 1988 40 yrs. 12 S. Third Street Richmond, VA 13,196 1900 40 yrs. 2300 East Parham Road Richmond, VA 71,585 1988 40 yrs. 5221 Valleypark Drive - Bldg A Roanoke, VA 134,601 1988 40 yrs. 5228 Valleypointe Parkway - Bldg B Roanoke, VA 62,774 1988 40 yrs. 5238 Valleypark Drive - Bldg C Roanoke, VA 144,089 1989 40 yrs. 94 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE - Continued 4523 Green Point Drive High Point, NC 405,750 1988 40 yrs. 4501 Green Point Drive High Point, NC 393,902 1989 40 yrs. 4500 Green Point Drive High Point, NC 395,570 1989 40 yrs. 2427 Penny Road High Point, NC 1,066,124 1990 40 yrs. 4524 Green Point Drive High Point, NC 394,090 1989 40 yrs. 4328, 4336 Federal Drive High Point, NC 678,380 1995 40 yrs. 200 Centreport Drive Greensboro, NC 300,014 1986 40 yrs. 4000 Piedmont Parkway High Point, NC 249,869 1997 40 yrs. 4380 Federal Drive High Point, NC 75,525 1997 40 yrs. 4388 Federal Drive High Point, NC 15,691 1997 40 yrs. 6532 Judge Adams Road Rock Creek, NC 43,080 1997 40 yrs. 3860 Faber Place N. Charleston, SC 33,038 1995 40 yrs. 4055 Faber Place N. Charleston, SC 83,122 1989 40 yrs. 3820 Faber Place N. Charleston, SC 87,852 1993 40 yrs. 440 Knox Abbott Drive Cayce, SC 61,844 1989 40 yrs. Alcoa Fujikura Facility Duncan, SC 134,986 1984 40 yrs. 1320 Garlington Road Greenville, SC 29,409 1986 40 yrs. 9800 Twin Lakes Parkway Charlotte, NC 35,961 1994 40 yrs. 420 Park Avenue Greenville, SC 72,949 1986 40 yrs. 111 Southchase Blvd. Fountain Inn, SC 76,773 1989 40 yrs. 300 International Blvd. Fountain Inn, SC 10,690 1995 40 yrs. 1208 Eastchester Drive High Point, NC 82,904 1988 40 yrs. One Independence Pointe Greenville, SC 12,677 1982 40 yrs. 55 Beattie Place Greenville, SC 49,204 1986 40 yrs. 75 Beattie Place Greenville, SC 36,534 1987 40 yrs. 4344 Federal Drive High Point, NC 112,594 1996 40 yrs. 202 Centreport Drive Greensboro, NC 306,398 1990 40 yrs. 1730 Stebbins Drive Houston, TX 229,748 1973 40 yrs. 5911-5925 Richard Street Jacksonville, FL 218,632 1977 40 yrs. 8383-8385 Baycenter Road Jacksonville, FL 242,593 1973 40 yrs. 8775 Baypine Road Jacksonville, FL 537,892 1989 40 yrs. 8539 Western Way Jacksonville, FL 750,093 1987 40 yrs. 6255 Lake Gray Boulevard Jacksonville, FL 780,177 1987 40 yrs. 6600-6660 Suemac Place Jacksonville, FL 778,457 1987 40 yrs. 6800-6850 Suemac Place Jacksonville, FL 452,334 1973 40 yrs. 8665,8667,8669 Baypine Road Jacksonville, FL 948,951 1987 40 yrs. 8540 Baycenter Road Jacksonville, FL 436,560 1984 40 yrs. 1200 Gulf Life Drive Jacksonville, FL 4,911,318 1985 40 yrs. 8400 Baymeadows Way Jacksonville, FL 543,713 1987 40 yrs. 8614 Baymeadows Way Jacksonville, FL 292,127 1986 40 yrs. 5941-5975 Richard Street Jacksonville, FL 513,893 1978 40 yrs. 7970 Bayberry Road Jacksonville, FL 372,464 1978 40 yrs. 6000-6030 Bowdendale Avenue Jacksonville, FL 635,300 1979 40 yrs. 7898 Baymeadows Way Jacksonville, FL 718,505 1978 40 yrs. 5977-6607 Richard Street Jacksonville, FL 794,758 1980 40 yrs. 7910 & 7948 Baymeadows Way Jacksonville, FL 927,778 1981 40 yrs. 7954 & 7960 Baymeadows Way Jacksonville, FL 951,026 1982 40 yrs. 8787 Baypine Road Jacksonville, FL 11,876,808 1990 40 yrs. 7077 Bonneval Road Jacksonville, FL 814,405 1988 40 yrs. 4190 Belfort Road Jacksonville, FL 867,906 1986 40 yrs. 8011, 8021, 8031 Phillips Highway Jacksonville, FL 319,060 1987 40 yrs. 11777 Central Highway Jacksonville, FL 304,289 1985 40 yrs. 7016 AC Skinner Parkway Jacksonville, FL 103,229 1996 40 yrs. 7018 AC Skinner Parkway Jacksonville, FL 72,407 1997 40 yrs. 6620 Southpoint Drive Jacksonville, FL 90,902 1984 40 yrs. 7980 Bayberry Road Jacksonville, FL 14,062 1978 40 yrs. 9600 Satellite Boulevard Orlando, FL 16,414 1989 40 yrs. 9700 Satellite Boulevard Orlando, FL 14,507 1989 40 yrs. 1902 Cypress Lake Drive Orlando, FL 20,150 1989 40 yrs. 8250 & 8256 Exchange Place Orlando, FL 15,735 1985 40 yrs. 6600 Southpoint Parkway Jacksonville, FL 25,297 1986 40 yrs. 6700 Southpoint Parkway Jacksonville, FL 19,888 1987 40 yrs. 4801 Executive Park Court - 100 Jacksonville, FL - 1990 40 yrs. 4801 Executive Park Court - 200 Jacksonville, FL - 1990 40 yrs. 4810 Executive Park Court Jacksonville, FL - 1990 40 yrs. 6602 Executive Park Court - 100 Jacksonville, FL - 1993 40 yrs. 6602 Executive Park Court - 200 Jacksonville, FL - 1993 40 yrs. 6631 Executive Park Court - 100 Jacksonville, FL - 1994 40 yrs. 6631 Executive Park Court - 200 Jacksonville, FL - 1994 40 yrs. 4815 Executive Park Court - 100 Jacksonville, FL - 1995 40 yrs. 4815 Executive Park Court - 200 Jacksonville, FL - 1995 40 yrs. 4825 Executive Park Court Jacksonville, FL - 1996 40 yrs. 4820 Executive Park Court Jacksonville, FL - 1997 40 yrs. 10511 & 10611 Satellite Boulevard Orlando, FL - 1985 40 yrs. 1400-1440 Central Florida Parkway Orlando, FL - 1962 40 yrs. 7020 AC Skinner Parkway Jacksonville, FL 125,236 1996 40 yrs. 7040 AC Skinner Parkway Jacksonville, FL 242,670 1996 40 yrs. 4001,4051,4101 Fowler Avenue Tampa, FL 1,011,946 1988 40 yrs. 5501-5502 Pioneer Park Boulevard Tampa, FL 148,684 1981 40 yrs. 8401-8408 Benjamin Road Tampa, FL 237,574 1986 40 yrs. 3501 Riga Blvd Tampa, FL 108,127 1983 40 yrs. 111 Kelsey Land Tampa, FL 56,054 1990 40 yrs. 7930, 8010-20 Woodland Center Tampa, FL 87,883 1990 40 yrs. 7920 Woodland Center Boulevard Tampa, FL 53,907 1997 40 yrs. 8154-8198 Woodland Center Tampa, FL 49,611 1988 40 yrs. 8112-42 Woodland Center Tampa, FL 54,108 1995 40 yrs. 8212 Woodland Center Tampa, FL 37,784 1996 40 yrs. 5690-5694 Crenshaw Street Tampa, FL 136,823 1979 40 yrs. 3102,3104,3110 Cherry Palm Drive Tampa, FL 183,217 1986 40 yrs. 1701 Clint Moore Blvd Boca Raton, FL 38,349 1985 40 yrs. 4555 Riverside Drive Beach Gardens, FL 48,602 1988 40 yrs. 2500 Metrocentre Boulevard West Palm Beach, FL 12,881 1988 40 yrs. 2540 Metrocenter Boulevard West Palm Beach, FL 8,881 1988 40 yrs. 2541 Metrocentre Boulevard West Palm Beach, FL 7,843 1988 40 yrs. 2580 Metrocentre Boulevard West Palm Beach, FL 13,861 1988 40 yrs. 95 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ OPERATING REAL ESTATE - Continued 2581 Metrocentre Boulevard West Palm Beach, FL 10,230 1988 40 yrs. 5410 - 5430 Northwest 33rd Avenue Ft. Lauderdale, FL 8,775 1985 40 yrs. 2905 Northwest Boulevard Plymouth, MN 88,329 1983 40 yrs. 2800 Campus Drive Plymouth, MN 68,542 1985 40 yrs. 2955 Xenium Lane Plymouth, MN 25,845 1985 40 yrs. 9401-9443 Science Center Drive New Hope, MN 77,757 1989 40 yrs. 6321-6325 Bury Drive Eden Prairie, MN 78,526 1988 40 yrs. 7115-7173 Shady Oak Road Eden Prairie, MN 80,284 1984 40 yrs. 7660-7716 Golden Triangle Drive Eden Prairie, MN 96,534 1988 40 yrs. 7400 Flying Cloud Drive Eden Prairie, MN 33,252 1987 40 yrs. 330 Second Avenue Minneapolis, MN 384,739 1980 40 yrs. 10301-10305 West 70th Street Eden Prairie, MN 20,527 1984 40 yrs. 10321 West 70th Street Eden Prairie, MN 24,718 1984 40 yrs. 10333 West 70th Street Eden Prairie, MN 18,871 1984 40 yrs. 10349-10357 West 70th Street Eden Prairie, MN 48,451 1985 40 yrs. 10365-10375 West 70th Street Eden Prairie, MN 49,468 1985 40 yrs. 10393-10394 West 70th Street Eden Prairie, MN 47,384 1985 40 yrs. 7078 Shady Oak Road Eden Prairie, MN 58,307 1985 40 yrs. 5600 & 5610 Rowland Road Minnetonka, MN 77,949 1988 40 yrs. 2920 Northwest Boulevard Plymouth, MN 7,138 1997 40 yrs. 26911-26957 Northwestern Southfield, MI 1,423,867 1985 40 yrs. 1650 Research Drive Troy, MI 89,558 1985 40 yrs. 1775 Research Drive Troy, MI 35,636 1985 40 yrs. 1875 Research Drive Troy, MI 35,277 1986 40 yrs. 1850 Research Drive Troy, MI 91,625 1986 40 yrs. 1965 Research Drive Troy, MI 45,310 1987 40 yrs. 1960 Research Drive Troy, MI 45,312 1987 40 yrs. 27260 Haggerty Road Farmington Hill, MI 51,625 1983 40 yrs. 27200 Haggerty Road Farmington Hill, MI 43,158 1983 40 yrs. 27280 Haggerty Road Farmington Hill, MI 42,690 1983 40 yrs. 27220 Haggerty Road Farmington Hill, MI 22,759 1985 40 yrs. 27240 Haggerty Road Farmington Hill, MI 19,178 1985 40 yrs. 27300 Haggerty Road Farmington Hill, MI 41,819 1985 40 yrs. 1101 Allen Drive Troy, MI 5,566 1974 40 yrs. 1151 Allen Drive Troy, MI 9,329 1974 40 yrs. 1300 Rankin Street Troy, MI 7,605 1979 40 yrs. 1350 Rankin Street Troy, MI 6,339 1979 40 yrs. 1376-1400 Rankin Street Troy, MI 7,617 1979 40 yrs. 1352-1374 Rankin Street Troy, MI 8,693 1979 40 yrs. 1324-1346 Rankin Street Troy, MI 7,605 1979 40 yrs. 1301-1307 Rankin Street Troy, MI 6,339 1978 40 yrs. 1409 Allen Drive Troy, MI 8,075 1978 40 yrs. 1304 E Maple Road Troy, MI 11,980 1971 40 yrs. 1334 Maplelawn Road Troy, MI 7,050 1983 40 yrs. 1290 Maplelawn Road Troy, MI 4,839 1984 40 yrs. 1070 Maplelawn Road Troy, MI 3,888 1982 40 yrs. 950 Maplelawn Road Troy, MI 14,317 1982 40 yrs. 894 Maplelawn Road Troy, MI 10,308 1986 40 yrs. 1179 Maplelawn Road Troy, MI 4,982 1984 40 yrs. 1940 Norwood Drive Troy, MI 4,925 1983 40 yrs. 1311-1331 Maplelawn Road Troy, MI 7,113 1986 40 yrs. 2354 Bellingham Street Troy, MI 4,954 1990 40 yrs. 2360 Bellingham Street Troy, MI 4,954 1985 40 yrs. 1911 Ring Drive Troy, MI 4,885 1986 40 yrs. 26442-26450 Haggerty Road Farmington Hill, MI 13,482 1988 40 yrs. 26500 Haggerty Road Farmington Hill, MI 17,645 1986 40 yrs. 26650 Haggerty Road Farmington Hill, MI 9,822 1988 40 yrs. 26700 Haggerty Road Farmington Hill, MI 14,369 1986 40 yrs. 26750 Haggerty Road Farmington Hill, MI 16,603 1988 40 yrs. 26800 Haggerty Road Farmington Hill, MI 9,954 1986 40 yrs. 26842-26850 Haggerty Road Farmington Hill, MI 13,590 1988 40 yrs. 50 Gibson Drive West Malling, UK 357,685 1996 40 yrs. 25 Kings Hill Avenue West Malling, UK 218,828 1996 40 yrs. 2 Kings Hill Avenue West Malling, UK 136,412 1996 40 yrs. 50 Kings Hill Avenue West Malling, UK 298,587 1996 40 yrs. ------------- Subtotal Operating Real Estate $ 149,310,861 ============= DEVELOPMENT PROPERTIES 132 Welsh Road Horsham, PA $ - 1997 N/A 3604 Horizon Blvd King of Prussia, PA - 1997 N/A 100 Cedar Hollow Road Malvern, PA - 1997 N/A 3 Country View Road Malvern, PA - 1997 N/A 425 Technology Drive Malvern, PA - 1997 N/A 375 Technology Drive Malvern, PA - 1997 N/A 100 Chesterfield Pkwy Malvern, PA - 1997 N/A 201 Berkeley Drive Bridgeport, NJ - 1997 N/A 300 Commodore Drive Bridgeport, NJ - 1997 N/A 1660 Valley Center Parkway Bethlehem, PA - 1996 N/A 89 South Commerce Way Bethlehem, PA - 1997 N/A 1525 Valley Ctr Pkwy Allentown, PA - 1997 N/A 700 Nestle Way Allentown, PA - 1997 N/A 5500 Cox Road Richmond, VA - 1997 N/A 13001 Kingston Ave Richmond, VA - 1997 N/A 5701-5799 Eastport Blvd Richmond, VA - 1996 N/A 4801 Cox Road Richmond, VA - 1997 N/A 701 Liberty Way Richmond, VA - 1997 N/A 5310 Valley Park Drive Roanoke, VA - 1997 N/A 5305 Valley Park Drive Roanoke, VA - 1997 N/A 530 Eastpark Court Sandston, VA - 1997 N/A 101 Centreport Greensboro, NC - 1996 N/A 6532 Judge Adams Road Whitsett, NC - 1997 N/A 3875 Faber Place N. Charleston, SC - 1997 N/A 1 Alliance Drive Goose Creek, SC - 1997 N/A 96 Accumulated Depreciation Date of Depreciable Project City @ 12/31/97 Construction Life (years) - -------------------------------------- ------------------- ------------- ------------ ------------ DEVELOPMENT PROPERTIES - Continued 1150 Northpoint Blvd Blythwood, SC - 1997 N/A 4160 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4194 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4196 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4170 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4180 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 7720 Mendenhall Oaks Pkwy High Point, NC - 1997 N/A 4345 Southpoint Parkway Jacksonville, FL - 1996 N/A 131 Silo Bend Tampa, FL - 1996 N/A 7724 Woodland Ctr Blvd Tampa, FL - 1997 N/A 7802-50 Woodland Ctr Blvd Tampa, FL - 1997 N/A 7852-98 Woodland Ctr Blvd Tampa, FL - 1997 N/A 8921 Brittany Way Tampa, FL - 1997 N/A 6601-6625 W. 78th Street Bloomington, MN - 1997 N/A 10400 Southwest Crossing Eden Prairie, MN - 1997 N/A 10 Kings Hill Ave West Malling, UK - 1997 N/A 30 Tower View West Malling, UK - 1997 N/A 35 Kings Hill Ave West Malling, UK - 1997 N/A ------------- Subtotal Development in Progress $ - ============= LAND HELD FOR DEVELOPMENT Chelsea Business Park Land Boothwyn, PA $ - 1988 N/A Gwynedd North Bus Camp Land Lansdale, PA - 1989 N/A Three Country View Road Malvern, PA - 1995 N/A 550 Lapp Road Malvern, PA - 1995 N/A Cedar Hollow Road Land Malvern, PA - 1996 N/A Walnut Grove Land Horsham, PA - 1996 N/A Iron Run Land Upper Macungie, PA - 1997 N/A 35 Liberty Blvd Land Malvern, PA - 1997 N/A 45 Liberty Blvd Land Malvern, PA - 1997 N/A Great Valley Land Malvern, PA - 1997 N/A 10 Matthews Rd South Land Malvern, PA - 1997 N/A 104 Witmer Road Horsham, PA - 1997 N/A 3 Franklin Plaza Philadelphia, PA - 1997 N/A 2700 Horizon Dr King of Prussia, PA - 1997 N/A 2900 Horizon Dr King of Prussia, PA - 1997 N/A 2500 Renaissance Blvd King of Prussia, PA - 1997 N/A 2300 Renaissance Blvd King of Prussia, PA - 1997 N/A Swedes Run Business Park Land Delran, NJ - 1992 N/A Marlton Crossing Land Marlton, NJ - 1994 N/A Commodore Business Park Logan Twp., NJ - 1995 N/A Boulden Land New Castle, DE - 1995 N/A Marlton Executive Park Land Marlton, NJ - 1994 N/A 17 Boulden Circle New Castle, DE - 1996 N/A 1015 Briggs Road Land Mt. Laurel, NJ - 1997 N/A 1020 Briggs Road Land Mt. Laurel, NJ - 1997 N/A Lehigh Valley Corporate Center Land Bethlehem, PA - 1987 N/A Park at Valleypointe Land Roanoke, VA - 1995 N/A Fairgrounds Distribution Center Land Richmond, VA - 1995 N/A Rivers' Bend Land Chesterfield City, VA - 1995 N/A Oakleys Center Land Richmond, VA - 1996 N/A Woodlands Center Land Sandston, VA - 1996 N/A 501 Liberty Way Chesterfield City, VA - 1996 N/A 601 Hewlett Packard Way Chesterfield City, VA - 1997 N/A 6000-98 Eastport Blvd Richmond, VA - 1997 N/A Eastport VIII Richmond, VA - 1997 N/A Eastport IX Richmond, VA - 1997 N/A Mendenhall Land High Point, NC - 1995 N/A Independence Pointe Land Greenville, SC - 1997 N/A Southpoint Business Park Land Jacksonville, FL - 1994 N/A Liberty Business Park Land Jacksonville, FL - 1995 N/A 7024 AC Skinner Parkway Jacksonville, FL - 1995 N/A 7014 AC Skinner Pkwy Jacksonville, FL - 1996 N/A Cypress Park Land Orlando, FL - 1997 N/A Exchange Place Land Orlando, FL - 1997 N/A Airport West Tampa, FL - 1995 N/A Silo Bend Land (LPDC) Tampa, FL - 1996 N/A West Tech Park Land (Lot B) Farmington Hill, MI - 1997 N/A West Tech Park Land (Lot C) Farmington Hill, MI - 1997 N/A ------------- Subtotal Land Held for Development $ - ============= Total All Properties $ 149,310,861 ============= * Denotes property is collateralized under mortgages with Nationwide, Principal Mutual, American General and Jackson National Life totalling $246.2 million. ** Rouse leases land from Kent County Council.
97 SCHEDULE III LIBERTY PROPERTY LIMITED PARTNERSHIP REAL ESTATE AND ACCUMULATED DEPRECIATION (In thousands) A summary of activity for real estate and accumulated depreciation is as follows: FOR THE YEARS ENDED DECEMBER 31, -------------------------------- 1997 1996 1995 ---------- ---------- --------- REAL ESTATE: Balance at beginning of year $1,178,713 $ 920,230 $ 586,789 Additions 960,548 268,066 333,441 Disposition of property (42,924) (9,583) -- ---------- ---------- --------- Balance at end of year $2,096,337 $1,178,713 $ 920,230 ========== ========== ========= ACCUMULATED DEPRECIATION: Balance at beginning of year $ 119,151 $ 94,183 $ 74,508 Depreciation expense 35,981 24,968 19,675 Disposition of property (5,821) - - ---------- ---------- --------- Balance at end of year $ 149,311 $ 119,151 $ 94,183 ========== ========== ========= 98 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND - ------------------------------------------------------------------------ FINANCIAL DISCLOSURE - -------------------- None. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANTS - ------------------------------------------------------------- ITEM 11. EXECUTIVE COMPENSATION - --------------------------------- ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND - -------------------------------------------------------------- MANAGEMENT - ---------- ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS - --------------------------------------------------------- Except as set forth under the caption "Executive Officers" in Part I, the information required by Part III, Items 10, 11, 12 and 13 of Form 10-K, is hereby incorporated by reference to the Trust's definitive proxy statement for its Annual Meeting of Shareholders (other than the information called for by Item 402(i), (k) and (l) of Regulation S-K, which is not incorporated herein by reference) presently scheduled for May 20, 1998, which proxy statement will be filed pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended not later than April 30, 1998, in accordance with General Instruction G(3) to Form 10- K. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K - ------------------------------------------------------------------ The following consolidated Financial Statements of Liberty Property Trust and Liberty Property Limited Partnership are included in Item 8. (A) 1. REPORTS OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS AND CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Auditors - Liberty Property Trust - ------------------------------------------------------- Financial Statements - Liberty Property Trust - --------------------------------------------- Balance Sheets: Liberty Property Trust Consolidated as of December 31, 1997 and 1996 Statements of Operations: Liberty Property Trust Consolidated for the years ended December 31, 1997, 1996 and 1995 Statements of Shareholders' Equity: Liberty Property Trust Consolidated for the years ended December 31, 1997, 1996 and 1995 99 Statements of Cash Flows: Liberty Property Trust Consolidated for the years ended December 31, 1997, 1996 and 1995 Notes to Financial Statements - Liberty Property Trust Report of Independent Auditors - Liberty Property Limited Partnership - --------------------------------------------------------------------- Financial Statements - Liberty Property Limited Partnership - ----------------------------------------------------------- Balance Sheets: Liberty Property Limited Partnership Consolidated as of December 31, 1997 and 1996 Statements of Operations: Liberty Property Limited Partnership Consolidated for the years ended December 31, 1997, 1996 and 1995 Statements of Owners' Equity: Liberty Property Limited Partnership Consolidated for the years ended December 31, 1997, 1996 and 1995 Statements of Cash Flows: Liberty Property Limited Partnership Consolidated for the years ended December 31, 1997, 1996 and 1995 Notes to Financial Statements - Liberty Property Limited Partnership 2. FINANCIAL STATEMENT SCHEDULES: Schedule III -- Real Estate and Accumulated Depreciation as of December 31, 1997 for Liberty Property Trust All other schedules are omitted because they are not required or the required information is shown in the financial statements or notes thereto. Schedule III -- Real Estate and Accumulated Depreciation as of December 31, 1997 for Liberty Property Limited Partnership All other schedules are omitted because they are not required or the required information is shown in the financial statements or notes thereto. 3. EXHIBITS The following exhibits are filed herewith or are incorporated by reference to exhibits previously filed. EXHIBIT NO. DESCRIPTION - ------------- -------------------------------------------------- 3.1.1 Amended and Restated Declaration of Trust of the Trust (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants' Current Report on Form 8-K filed with the Commission on June 25, 1997 (the "June 25, 1997 Form 8-K")). 100 EXHIBIT NO. DESCRIPTION - ------------- -------------------------------------------------- 3.1.2 Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust Establishing and Fixing the Rights and Preferences of a Series of Preferred Shares of Beneficial Interest (Incorporated by reference to Exhibit 1 filed with the Trust's Registration Statement on Form 8- A filed with the Commission on August 8, 1997) (the "August 1997 Form 8-A"). 3.1.3 Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust Relating to Designation, Preferences, and Rights of Series A Junior Participating Preferred Shares of the Trust. 3.1.4 Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership, dated as of October 22, 1997 (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants' Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 1997 (the "Third Quarter 1997 Form 10-Q")). 3.1.5 Amended and Restated Exhibit A to the Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership. 3.2 Amended and Restated By-laws of the Trust (Incorporated by reference to Exhibit 3.2 filed with the Trust's Registration Statement on Form S- 11, filed with the Commission on March 30, 1994 (the "Form S-11"). 4.1 Rights Agreement, dated as of December 17, 1997, by and between the Trust and the Rights Agent (Incorporated by reference to Exhibit 1 filed with the Trust's Registration Statement on Form 8-A filed with the Commission on December 23, 1997). 4.2 Indenture between the Operating Partnership and Bank of Boston, as Trustee, including Guaranty Provisions and Form of Debenture (Incorporated by reference to Exhibit 4.1 filed with the Form S- 11). 4.3 Indenture (the "First Indenture"), dated as of August 14, 1997, between the Operating Partnership, as Obligor, and The First National Bank of Chicago ("First Chicago"), as Trustee (Incorporated by reference to Exhibit 10.1 filed with the Third Quarter 1997 Form 10-Q). 4.4 First Supplemental Indenture, dated as of August 14, 1997, between the Operating Partnership, as Issuer, and First Chicago, as Trustee, supplementing the First Indenture and relating to $100,000,000 principal amount of the 7.10% Senior Notes due 2004 and $100,000,000 principal amount 101 EXHIBIT NO. DESCRIPTION - ------------- -------------------------------------------------- 4.4 - Continued of the 7.25% Senior Notes due 2007 of the Operating Partnership (Incorporated by reference to Exhibit 10.2 filed with the Third Quarter 1997 Form 10-Q). 4.5 Senior Indenture (the "Second Indenture"), dated as of October 24, 1997, between the Operating Partnership, as Obligor, and First Chicago, as Trustee (Incorporated by reference to Exhibit 10.3 filed with the Third Quarter 1997 Form 10-Q). 4.6 First Supplemental Indenture, dated as of October 24, 1997, between the Operating Partnership, as Issuer, and First Chicago, as Trustee, supplementing the Second Indenture and relating to the Fixed Rate and Floating Rate Medium-Term Notes due Nine Months or More from Date of Issue of the Operating Partnership (Incorporated by reference to Exhibit 10.4 filed with the Third Quarter 1997 Form 10-Q). 4.7 Note, Relating to the Issuance by the Operating Partnership, on December 9, 1997, of $100 Million Principal Amount of its 6.95% Medium-Term Notes due 2006. 4.8 Note, Relating to the Issuance by the Operating Partnership, on December 11, 1997, of $50 Million Principal Amount of its 6.97% Medium-Term Notes due 2003. 10.1 Liberty Property Trust Amended and Restated Share Incentive Plan (Incorporated by reference to Exhibit 10.1 filed with the June 25, 1997 Form 8- K). 10.5 Contribution Agreement (Incorporated by reference to Exhibit 10.5 filed with the Form S-11). 10.6 Amended and Restated Limited Partnership Agreements of Pre-existing Pennsylvania Partnerships (Incorporated by reference to Exhibit 10.6 filed with the Form S-11). 10.7 Agreement of Sale for the Acquisition Properties (Incorporated by reference to Exhibit 10.7 filed with the Form S-11). 10.8 Option Agreement and Right of First Offer (Incorporated by reference to Exhibit 10.8 filed with the Form S-11). 10.9 Form of Indemnity Agreement (Incorporated by reference to Exhibit 10.9 filed with the Form S- 11). 102 EXHIBIT NO. DESCRIPTION - ------------- -------------------------------------------------- 10.10 Contribution Agreement among the Trust, the Operating Partnership and the Contributing Owners described therein, related to the Lingerfelt Properties (Incorporated by reference to Exhibit 10.1 filed with the Registrants' Current Report on Form 8-K filed with the Commission on March 3, 1995. 10.11 Amended and Restated Loan Agreement, dated as of June 16, 1997, by and among the Operating Partnership, the Trust, the Banks named therein and Bank Boston, N.A., as agent for itself and the other lending institutions (Incorporated by reference to Exhibit 10 filed with the August 1997 Form 8-A). 21 Subsidiaries. 23.1 Consent of Ernst & Young LLP relating to financial statements of the Trust. 23.2 Consent of Ernst & Young LLP relating to financial statements of the Operating Partnership. 27 Financial Data Schedule (EDGAR version only). (B) REPORTS ON FORM 8-K REPORTS ON FORM 8-K ------------------- Report on Form 8-K dated November 4, 1997 filed under Items 5 and 7 of Form 8-K relating to the acquisition of two properties during the period from August 14, 1997 to September 11, 1997. The report included a Combined Statement of Operating Revenue and Certain Operating Expenses for a majority of the properties, Pro Forma Condensed Consolidated Balance Sheets for Liberty Property Trust and Liberty Property Limited Partnership, and Pro Forma Consolidated Statements of Operations for Liberty Property Trust and Liberty Property Limited Partnership. Report on Form 8-K dated November 13, 1997 under Items 5 and 7 on Form 8-K relating to the acquisition of seven properties on May 13, 1997. The report included a Combined Statement of Operating Revenue and Certain Operating Expenses for a majority of the properties, Pro Forma Condensed Consolidated Balance Sheets for Liberty Property Trust and Liberty Property Limited Partnership, and Pro Forma Consolidated Statements of Operations for Liberty Property Trust and Liberty Property Limited Partnership. Report on Form 8-K dated November 17, 1997 filed under Items 5 and 7 of Form 8-K relating to a public offering of eight million Common Shares on November 13, 1997. Report on Form 8-K dated November 19, 1997 filed under Items 5 and 7 of Form 8-K relating to the acquisition of 22 properties on November 13, 1997. The report included a Combined Statement of Operating Revenue and Certain Operating Expenses for a majority of the properties, Pro Forma Condensed Consolidated Balance Sheets for Liberty Property Trust and 103 Liberty Property Limited Partnership, and Pro Forma Consolidated Statements of Operations for Liberty Property Trust and Liberty Property Limited Partnership. Report on Form 8-K dated December 11, 1997 filed under Items 5 and 7 of Form 8-K relating to the acquisition of two properties on November 26, 1996. The report included a Combined Statement of Operating Revenue and Certain Operating Expenses for a majority of the properties, Pro Forma Condensed Consolidated Balance Sheets for Liberty Property Trust and Liberty Property Limited Partnership, and Pro Forma Consolidated Statements of Operations for Liberty Property Trust and Liberty Property Limited Partnership. Report on Form 8-K dated December 15, 1997 filed under Items 5 and 7 of Form 8-K relating to a public offering of 796,505 Common Shares on December 11, 1997. Report on Form 8-K dated December 18, 1997 (as amended by a Form 8- K/A filed on December 23, 1997) filed under Items 5 and 7 on Form 8-K relating to the Trust's Shareholder's Rights Plan, dated December 17, 1997. 104 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. LIBERTY PROPERTY TRUST Date: February 27, 1998 By: /s/ WILLARD G. ROUSE III -------------------------------------- WILLARD G. ROUSE III CHIEF EXECUTIVE OFFICER Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated. Chairman of the Board of Trustees and Chief Executive Officer (Principal Executive /s/ Willard G. Rouse III Officer) February 27, 1998 - --------------------------- Willard G. Rouse III Chief Financial Officer and Treasurer (Principal Financial and Accounting /s/ George J. Alburger, Jr. Officer) February 27, 1998 - --------------------------- George J. Alburger, Jr. /s/ Joseph P. Denny Trustee February 27, 1998 - --------------------------- Joseph P. Denny /s/ George F. Congdon Trustee February 27, 1998 - --------------------------- George F. Congdon /s/ M. Leanne Lachman Trustee February 27, 1998 - --------------------------- M. Leanne Lachman 105 /s/ Frederick F. Buchholz Trustee February 27, 1998 - --------------------------- Frederick F. Buchholz /s/ J. Anthony Hayden Trustee February 27, 1998 - --------------------------- J. Anthony Hayden /s/ David L. Lingerfelt Trustee February 27, 1998 - --------------------------- David L. Lingerfelt /s/ John A. Miller Trustee February 27, 1998 - --------------------------- John A. Miller, CLU /s/ Stephen B. Siegel Trustee February 27, 1998 - --------------------------- Stephen B. Siegel 106 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. LIBERTY PROPERTY LIMITED PARTNERSHIP BY: Liberty Property Trust General Partner Date: February 27, 1998 By: /s/ WILLARD G. ROUSE III -------------------------------------- WILLARD G. ROUSE III CHIEF EXECUTIVE OFFICER Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated. Trustee of the /s/ Joseph P. Denny General Partner February 27, 1998 - --------------------------- Joseph P. Denny Trustee of the /s/ George F. Congdon General Partner February 27, 1998 - --------------------------- George F. Congdon Trustee of the /s/ M. Leanne Lachman General Partner February 27, 1998 - --------------------------- M. Leanne Lachman Trustee of the /s/ Frederick F. Buchholz General Partner February 27, 1998 - --------------------------- Frederick F. Buchholz Trustee of the /s/ J. Anthony Hayden General Partner February 27, 1998 - --------------------------- J. Anthony Hayden 107 Trustee of the /s/ David L. Lingerfelt General Partner February 27, 1998 - --------------------------- David L. Lingerfelt Trustee of the /s/ John A. Miller General Partner February 27, 1998 - --------------------------- John A. Miller, CLU Trustee of the /s/ Stephen B. Siegel General Partner February 27, 1998 - --------------------------- Stephen B. Siegel 108 EXHIBIT INDEX ------------- EXHIBIT NO. DESCRIPTION - ------------- -------------------------------------------------- 3.1.3 Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust Relating to Designation, Preferences, and Rights of Series A Junior Participating Preferred Shares of the Trust. 3.1.5 Amended and Restated Exhibit A to the Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership. 4.7 Note, Relating to the Issuance by the Operating Partnership, on December 9, 1997, of $100 Million Principal Amount of its 6.95% Medium-Term Notes due 2006. 4.8 Note, Relating to the Issuance by the Operating Partnership, on December 11, 1997, of $50 Million Principal Amount of its 6.97% Medium-Term Notes due 2003. 21 Subsidiaries. 23.1 Consent of Ernst & Young LLP relating to financial statements of the Trust. 23.2 Consent of Ernst & Young LLP relating to financial statements of the Operating Partnership. 27 Financial Data Schedule (EDGAR version only). 109 EX-3 2 EXHIBIT 3.1.3 LIBERTY PROPERTY TRUST ARTICLES SUPPLEMENTARY ESTABLISHING AND FIXING THE RIGHTS AND PREFERENCES OF A SERIES OF JUNIOR PARTICIPATING PREFERRED SHARES OF BENEFICIAL INTEREST of LIBERTY PROPERTY TRUST Liberty Property Trust, a Maryland real estate investment trust (the "Trust") certifies to the State Department of Assessments and Taxation of Maryland that: FIRST: Pursuant to the authority vested in the Board of Trustees of the Trust (the "Board of Trustees") by Sections 3.2(e), 6.1 and 6.3 of the Amended and Restated Declaration of Trust of the Trust (the "Declaration of Trust") and by Section 8-203 of the Corporations and Associations Article of the Annotated Code of Maryland, the Board of Trustees by duly adopted resolution on December 17, 1997, has duly classified and designated 200,000 shares of the 200,000,000 authorized shares of beneficial interest in the Trust designated as "Series A Junior Participating Preferred Shares of Beneficial Interest," which possess the preferences conversion or other rights, restrictions, limitations as to dividends, qualifications and terms and conditions of redemption as set forth in these Articles Supplementary: Section 1. Designation and Amount. The shares of such series shall be designated as "Series A Junior Participating Preferred Shares," par value $0.0001 per share, and the number of shares constituting such series shall be 200,000. Section 2. Dividends and Distributions. (A) The holders of Series A Junior Participating Preferred Shares shall be entitled to receive, when, as and if declared by the Board of Trustees out of funds legally available for the purpose, quarterly dividends payable in cash on the last day of March, June, September and December in each year (each such date being referred to herein as a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a Series A Junior Participating Preferred Share, in an amount per share (rounded to the nearest cent) equal to the greater of (a) $0.01 or (b) subject to the provision for adjustment hereinafter set forth, 1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions other than a dividend payable in Common Shares or a subdivision of the outstanding Common Shares (by reclassification or otherwise), declared on the Common Shares, par value $0.001 per share, of the Trust (the "Common Shares") since the immediately preceding Quarterly Dividend Payment Date, or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a Series A Junior Participating Preferred Share. In the event the Trust shall at any time after December 17, 1997 (the "Rights Declaration Date") (i) declare any dividend on Common Shares payable in Common Shares, (ii) subdivide the outstanding Common Shares, or (iii) combine the outstanding Common Shares into a smaller number of shares, then in each such case the amount to which holders of Series A Junior Participating Preferred Shares were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount by a fraction the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. (B) The Trust shall declare a dividend or distribution on the outstanding Series A Junior Participating Preferred Shares as provided in Paragraph (A) above immediately after it declares a dividend or distribution on the Common Shares (other than a dividend payable in Common Shares); provided that, in the event no dividend or distribution shall have been declared on the Common Shares during the period between any Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend of $0.01 per share on the outstanding Series A Junior Participating Preferred Shares shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date. (C) Dividends shall begin to accrue and be cumulative on outstanding Series A Junior Participating Preferred Shares from the Quarterly Dividend Payment Date next preceding the date of issue of such Series A Junior Participating Preferred Shares, unless the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for the determination of holders of Series A Junior Participating Preferred Shares entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on the Series A Junior Participating Preferred Shares in an amount less than the total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time outstanding. The Board of Trustees may fix a record date for the determination of holders of Series A Junior Participating Preferred Shares entitled to receive payment of a dividend or distribution declared thereon, which record date shall be no more than thirty (30) days prior to the date fixed for the payment thereof. Section 3. Voting Rights. The holders of Series A Junior Participating Preferred Shares shall have the following voting rights: (A) Subject to the provision for adjustment hereinafter set forth, each share of Series A Junior Participating Preferred Shares shall entitle the holder thereof to 1,000 votes on all matters submitted to a vote of the shareholders of the Trust. In the event the Trust shall at any time after the Rights Declaration Date (i) declare any dividend on Common Shares payable in Common Shares, (ii) subdivide the outstanding Common Shares, or (iii) combine the outstanding Common Shares into a smaller number of shares, then in each such case the number of votes per share to which holders of Series A Junior Participating Preferred Shares were entitled immediately prior to such event shall be adjusted by multiplying such number by a fraction the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. (B) Except as otherwise provided herein or by law, the holders of Series A Junior Participating Preferred Shares and the holders of Common Shares shall vote together as one class on all matters submitted to a vote of shareholders of the Trust. (C)(i) If at any time dividends on any Series A Junior Participating Preferred Shares shall be in arrears in an amount equal to six (6) quarterly dividends thereon, the occurrence of such contingency shall mark the beginning of a period (herein called a "default period") which shall extend until such time when all accrued and unpaid dividends for all previous quarterly dividend periods and for the current quarterly dividend period on all Series A Junior Participating Preferred Shares then outstanding shall have been declared and paid or set apart for payment. During each default period, all holders of Preferred Shares (including holders of the Series A Junior Participating Preferred Shares) with dividends in arrears in an amount equal to six (6) quarterly dividends thereon, voting as a class, irrespective of series, shall have the right to elect two (2) Trustees. (ii) During any default period, such voting right of the holders of Series A Junior Participating Preferred Shares may be exercised initially at a special meeting called pursuant to subparagraph (iii) of this Section 3(C) or at any annual meeting of shareholders, and thereafter at annual meetings of shareholders, provided that such voting right shall not be exercised unless the holders of ten percent (10%) in number of Preferred Shares outstanding shall be present in person or by proxy. The absence of a quorum of the holders of Common Shares shall not affect the exercise by the holders of Preferred Shares of such voting right. At any meeting at which the holders of Preferred Shares shall exercise such voting right initially during an existing default period, they shall have the right, voting as a class, to elect Trustees to fill such vacancies, if any, in the Board of Trustees as may then exist up to two (2) Trustees or, if such right is exercised at an annual meeting, to elect two (2) Trustees. If the number which may be so elected at any special meeting does not amount to the required number, the holders of the Preferred Shares shall have the right to make such increase in the number of Trustees as shall be necessary to permit the election by them of the required number. After the holders of the Preferred Shares shall have exercised their right to elect Trustees in any default period and during the continuance of such period, the number of Trustees shall not be increased or decreased except by vote of the holders of Preferred Shares as herein provided or pursuant to the rights of any equity securities ranking senior to or pari passu with the Series A Junior Participating Preferred Shares. (iii) Unless the holders of Preferred Shares shall, during an existing default period, have previously exercised their right to elect Trustees, the Board of Trustees may order, or any shareholder or shareholders owning in the aggregate not less than ten percent (10%) of the total number of Preferred Shares outstanding, irrespective of series, may request, the calling of a special meeting of the holders of Preferred Shares, which meeting shall thereupon be called by the President, a Vice-President or the Secretary of the Trust. Notice of such meeting and of any annual meeting at which holders of Preferred Shares are entitled to vote pursuant to this Paragraph (C)(iii) shall be given to each holder of record of Preferred Shares by mailing a copy of such notice to such holder at such holder's last address as the same appears on the books of the Trust. Such meeting shall be called for a time not earlier than twenty (20) days and not later than sixty (60) days after such order or request, or in default of the calling of such meeting within sixty (60) days after such order or request, such meeting may be called on similar notice by any shareholder or shareholders owning in the aggregate not less than ten percent (10%) of the total number of Preferred Shares outstanding. Notwithstanding the provisions of this Paragraph (C)(iii), no such special meeting shall be called during the period within sixty (60) days immediately preceding the date fixed for the next annual meeting of the shareholders. (iv) In any default period, the holders of Common Shares, and other classes of shares of the Trust if applicable, shall continue to be entitled to elect the whole number of Trustees until the holders of Preferred Shares shall have exercised their right to elect two (2) Trustees voting as a class, after the exercise of which right (x) the Trustees so elected by the holders of Preferred Shares shall continue in office until their successors shall have been elected by such holders or until the expiration of the default period, and (y) any vacancy in the Board of Trustees may (except as provided in Paragraph (C)(ii) of this Section 3) be filled by vote of a majority of the remaining Trustees theretofore elected by the holders of the class of stock which elected the Trustee whose office shall have become vacant. References in this Paragraph (C) to Trustees elected by the holders of a particular class of stock shall include Trustees elected by such Trustees to fill vacancies as provided in clause (y) of the foregoing sentence. (v) Immediately upon the expiration of a default period, (x) the right of the holders of Preferred Shares as a class to elect Trustees shall cease, (y) the term of any Trustees elected by the holders of Preferred Shares as a class shall terminate, and (z) the number of Trustees shall be such number as may be provided for in the Declaration of Trust or By-laws of the Trust irrespective of any increase made pursuant to the provisions of Paragraph (C)(ii) of this Section 3 (such number being subject, however, to change thereafter in any manner provided by law or in the Declaration of Trust or By-laws of the Trust). Any vacancies in the Board of Trustees effected by the provisions of clauses (y) and (z) in the preceding sentence may be filled by a majority of the remaining Trustees. (D) Except as set forth herein, holders of Series A Junior Participating Preferred Shares shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Shares as set forth herein) for taking any corporate action. Section 4. Certain Restrictions. (A) Whenever quarterly dividends or other dividends or distributions payable on the Series A Junior Participating Preferred Shares as provided in Section 2 hereof are in arrears, thereafter and until all accrued and unpaid dividends and distributions, whether or not declared, on Series A Junior Participating Preferred Shares outstanding shall have been paid in full, the Trust shall not: (i) declare or pay dividends on, make any other distributions on, or redeem or purchase or otherwise acquire for consideration any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Junior Participating Preferred Shares; (ii) declare or pay dividends on or make any other distributions on any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Junior Participating Preferred Shares, except dividends paid ratably on the Series A Junior Participating Preferred Shares and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled; (iii) redeem or purchase or otherwise acquire for consideration shares of any stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Junior Participating Preferred Shares, provided that the Trust may at any time redeem, purchase or otherwise acquire shares of any such parity stock in exchange for shares of any stock of the Trust ranking junior (either as to dividends or upon dissolution, liquidation or winding up) to the Series A Junior Participating Preferred Shares; or (iv) purchase or otherwise acquire for consideration any Series A Junior Participating Preferred Shares, or any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Junior Participating Preferred Shares, except in accordance with a purchase offer made in writing or by publication (as determined by the Board of Trustees) to all holders of such shares upon such terms as the Board of Trustees, after consideration of the respective annual dividend rates and other relative rights and preferences of the respective series and classes, shall determine in good faith will result in fair and equitable treatment among the respective series or classes. (B) The Trust shall not permit any subsidiary of the Trust to purchase or otherwise acquire for consideration any shares of the Trust unless the Trust could, under Paragraph (A) of this Section 4, purchase or otherwise acquire such shares at such time and in such manner. Section 5. Reacquired Shares. Any Series A Junior Participating Preferred Shares purchased or otherwise acquired by the Trust in any manner whatsoever shall be retired and canceled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued Preferred Shares and may be reissued as part of a new series of Preferred Shares to be created by resolution or resolutions of the Board of Trustees, subject to the conditions and restrictions on issuance set forth herein. Section 6. Liquidation, Dissolution or Winding Up. (A) Upon any liquidation (voluntary or otherwise), dissolution or winding up of the Trust, no distribution shall be made to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Junior Participating Preferred Shares unless, prior thereto, the holders of Series A Junior Participating Preferred Shares shall have received an amount equal to $100,000 per share of Series A Junior Participating Preferred Shares, plus an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment (the "Series A Liquidation Preference"). Following the payment of the full amount of the Series A Liquidation Preference, no additional distributions shall be made to the holders of Series A Junior Participating Preferred Shares unless, prior thereto, the holders of Common Shares shall have received an amount per share (the "Common Adjustment") equal to the quotient obtained by dividing (i) the Series A Liquidation Preference by (ii) 1,000 (as appropriately adjusted as set forth in subparagraph (C) below to reflect such events as stock splits, stock dividends and recapitalizations with respect to the Common Shares) (such number in clause (ii), the "Adjustment Number"). Following the payment of the full amount of the Series A Liquidation Preference and the Common Adjustment in respect of all outstanding Series A Junior Participating Preferred Shares and Common Shares, respectively, holders of Series A Junior Participating Preferred Shares and holders of Common Shares shall receive their ratable and proportionate share of the remaining assets to be distributed in the ratio of the Adjustment Number to 1 with respect to such Preferred Shares and Common Shares, on a per share basis, respectively. (B) In the event, however, that there are not sufficient assets available to permit payment in full of the Series A Liquidation Preference and the liquidation preferences of all other series of Preferred Shares, if any, which rank on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Junior Participating Preferred Shares, then such remaining assets shall be distributed ratably to the holders of such parity shares in proportion to their respective liquidation preferences. In the event, however, that there are not sufficient assets available to permit payment in full of the Common Adjustment, then such remaining assets shall be distributed ratably to the holders of Common Shares. (C) In the event the Trust shall at any time after the Rights Declaration Date (i) declare any dividend on Common Shares payable in Common Shares, (ii) subdivide the outstanding Common Shares, or (iii) combine the outstanding Common Shares into a smaller number of shares, then in each such case the Adjustment Number in effect immediately prior to such event shall be adjusted by multiplying such Adjustment Number by a fraction the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. Section 7. Consolidation, Merger, etc. In case the Trust shall enter into any consolidation, merger, combination or other transaction in which the Common Shares are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case the Series A Junior Participating Preferred Shares shall at the same time be similarly exchanged or changed in an amount per share (subject to the provision for adjustment hereinafter set forth) equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each Common Share is changed or exchanged. In the event the Trust shall at any time after the Rights Declaration Date (i) declare any dividend on Common Shares payable in Common Shares, (ii) subdivide the outstanding Common Shares or (iii) combine the outstanding Common Shares into a smaller number of shares, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of Series A Junior Participating Preferred Shares shall be adjusted by multiplying such amount by a fraction the numerator of which is the number of Common Shares outstanding immediately after such event and the denominator of which is the number of Common Shares that were outstanding immediately prior to such event. Section 8. No Redemption. The Series A Junior Participating Preferred Shares shall not be redeemable. Section 9. Amendment. The Declaration of Trust of the Trust shall not be further amended in any manner which would materially alter or change the powers, preferences or special rights of the Series A Junior Participating Preferred Shares so as to affect them adversely without the affirmative vote of the holders of a majority or more of the outstanding Series A Junior Participating Preferred Shares, voting separately as a class. Section 10. Fractional Shares. Series A Junior Participating Preferred Shares may be issued in fractions of a share which shall entitle the holder, in proportion to such holder's fractional shares, to exercise voting rights, receive dividends, participate in distributions and to have the benefit of all other rights of holders of Series A Junior Participating Preferred Shares. SECOND: The Series A Junior Participating Preferred Shares have been classified and designated by the Board of Trustees under authority contained in the Declaration of Trust. THIRD: These Articles Supplementary have been approved by the Board of Trustees in the manner and by the vote required by law. FOURTH: These Articles Supplementary shall be effective at the time the State Department of Assessments and Taxation accepts these Articles Supplementary for record. FIFTH: The undersigned Chairman of the Board of Trustees and Chief Executive Officer of the Trust acknowledges these Articles Supplementary to be the act of the Trust and, as to all matters of fact required to be verified under oath, the undersigned Chairman of the Board of Trustees and Chief Executive Officer of the Trust acknowledges that to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under penalties for perjury. IN WITNESS WHEREOF, the Trust has caused these Articles Supplementary to be executed under seal in its name and in its behalf by the Chairman of the Board of Trustees and Chief Executive Officer and attested to by its Secretary on this 23rd day of December, 1997. LIBERTY PROPERTY TRUST By: /s/ Willard G. Rouse IIII (SEAL) - --------------------------------------- Willard G. Rouse III, Chairman of the Board of Trustees and Chief Executive Officer Attest: /s/ James J. Bowes (SEAL) - --------------------------------------- James J. Bowes, Secretary EX-3 3 EXHIBIT 3.1.5 SCHEDULE "A" LIBERTY PROPERTY LIMITED PARTNERSHIP PARTNERSHIP INTERESTS AS OF DECEMBER 31, 1997 NUMBER OF PARTNERSHIP LIMITED PARTNERS INTERESTS - --------------------------------------- ----------- Balitsaris, Peter 34,969 Carr, Clai 118,198 Castorina, John 11,094 Congdon, George 307,030 Denny, Joseph 260,250 Felix, Jill 195,043 Fenza, Robert 187,670 Fitzgerald, Ward 9,344 Gildea, Larry 93,319 Goldschmidt, Robert 22,895 Hagan, Michael 9,343 Hammers, David 233,133 Kiel, Bob 14,491 Kline, Earl 18,820 Lutz, Jim 27,981 Mazzerralli, James 13,445 Messaros, Steve 7,246 Messaros, Sharon 7,245 Morrissey, Mary Beth 9,344 Price, Leslie 167,964 Reichert, Joseph 27,242 Rouse & Associates, Inc. 4,652 Rouse, Willard 453,320 Trust Congdon Children 92,825 Trust Hammers Children 89,651 Trust for Mary Rouse 11,223 Trust for Anne Rouse 11,223 Trust for Rouse Younger Children 67,338 Trust for Lori Hammers 5,506 Weitzmann, Mike 42,312 Southeast Limited Partnership 168,445 Liberty Special Purpose Corp. 10,574 Lingerfelt, Rebecca 8,076 Trust J. Ryan Lingerfelt 15,625 Trust Justin M. Lingerfelt 15,625 Trust Daniel K. Lingerfelt 15,625 Trust Catherine E. Lingerfelt 15,625 Lingerfelt, Alan T. 317,500 Lingerfelt, L. Harold 164,375 Carpenter, James J. 78,750 Lingerfelt, David L. 30,674 Ferguson, Morris U. 6,000 Lingerfelt, Carl C. 12,500 Wright, Murray H. 7,500 Latimer, Erle Marie 12,500 Mazel Investments LLC 28,025 Stewart R. Stender 53,865 Robert C. Lux 53,864 NWBC Associates, Inc. 28,191 330 Associates, Inc. 2,574 APEX Asset Management Corp. 85,051 LPC of S.C., Inc. 487,742 Libco of Florida, Inc. 283,238 Southchase Development Corp. 203,214 Rouse & Associates Maryland Partnership 20,000 ----------- Total Limited Partner Interests 4,679,274 General Partner - ---------------------------------------- Liberty Property Trust - Preferred Units 5,000,000 Liberty Property Trust GP GP - The partnership units for Liberty Property Trust has not been reflected because there is no conversion of units to shares to the general partner. EX-4 4 EXHIBIT 4.7 [FACE OF NOTE] THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE TRANSFERRED TO, OR REGISTERED OR EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE DEPOSITORY OR A NOMINEE THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY SECURITY AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.* UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY (AS DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.* LIBERTY PROPERTY LIMITED PARTNERSHIP MEDIUM-TERM NOTE (Fixed Rate) REGISTERED CUSIP No.: PRINCIPAL AMOUNT: $ No. FXR- 1 531117EAA6 100,000,000 ORIGINAL ISSUE DATE: INTEREST RATE:% 6.95 STATED MATURITY DATE: 12/09/97 12/01/06 INTEREST PAYMENT DATE(S): DEFAULT RATE: % [X] June 1 and Dec. 1 [ ] Other: INITIAL REDEMPTION INITIAL REDEMPTION ANNUAL REDEMPTION DATE: PERCENTAGE: % PERCENTAGE REDUCTION: % OPTIONAL REPAYMENT REPAYMENT PRICE:% [ ] CHECK IF A DATE (S): 100 DISCOUNT NOTE Issue Price: % SPECIFIED CURRENCY: AUTHORIZED DENOMINATION: [X] United States dollars [X] $1,000 and integral [ ] Other: multiples thereof [ ] Other: EXCHANGE RATE EXCHANGE RATE: AGENT: U.S. $1.00 = ADDENDUM ATTACHED: OTHER/ADDITIONAL PROVISIONS: [X] Yes [ ] No * This paragraph applies to global Notes only. Liberty Property Limited Partnership, a Pennsylvania limited partnership (the "Company," which term includes any successor entity under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO, or registered assigns, upon presentation, the principal sum of $ 100,000,000 (One Hundred Million) , on the Stated Maturity Date specified above (or any Redemption Date or Repayment Date, each as defined on the reverse hereof) (each such Stated Maturity Date, Redemption Date or Repayment Date being hereinafter referred to as the "Maturity Date" with respect to the principal repayable on such date) and to pay interest thereon, at the Interest Rate per annum specified above, until the principal hereof is paid or duly made available for payment, and (to the extent that the payment of such interest shall be legally enforceable) at the Default Rate per annum specified above on any overdue principal, premium and/or interest. The Company will pay interest in arrears on each Interest Payment Date, if any, specified above (each, an "Interest Payment Date"), commencing with the first Interest Payment Date next succeeding the Original Issue Date specified above, and on the Maturity Date; provided, however, that if the Original Issue Date occurs between a Record Date (as defined below) and the next succeeding Interest Payment Date, interest payments will commence on the second Interest Payment Date next succeeding the Original Issue Date to the holder of this Note on the Record Date with respect to such second Interest Payment Date. Interest on this Note will be computed on the basis of a 360-day year of twelve 30-day months. Interest on this Note will accrue from, and including, the immediately preceding Interest Payment Date to which interest has been paid or duly provided for (or from, and including, the Original Issue Date if no interest has been paid or duly provided for) to, but excluding, the applicable Interest Payment Date or the Maturity Date, as the case may be (each, an "Interest Period"). The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, subject to certain exceptions described herein, be paid to the person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on the fifteenth calendar day (whether or not a Business Day, as defined below) immediately preceding such Interest Payment Date (the "Record Date"); provided, however, that interest payable on the Maturity Date will be payable to the person to whom the principal hereof and premium, if any, hereon shall be payable. Any such interest not so punctually paid or duly provided for ("Defaulted Interest") will forthwith cease to be payable to the holder on any Record Date, and shall be paid to the person in whose name this Note is registered at the close of business on a special record date (the "Special Record Date") for the payment of such Defaulted Interest to be fixed by the Trustee hereinafter referred to, notice whereof shall be given to the holder of this Note by the Trustee not less than 10 days prior to such Special Record Date or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which this Note may be listed, and upon such notice as may be required by such exchange, all as more fully provided for in the Indenture. Payment of principal, premium, if any, and interest in respect of this Note due on the Maturity Date will be made in immediately available funds upon presentation and surrender of this Note (and, with respect to any applicable repayment of this Note, upon presentation and surrender of this Note and a duly completed election form as contemplated on the reverse hereof) at the office or agency maintained by the Company for that purpose in the Borough of Manhattan, The City of New York, currently the office of the Trustee located at First National Bank of Chicago, c/o First Chicago Trust Company of New York, 14 Wall Street, 8th Floor, New York, New York 10005, or at such other paying agency in the Borough of Manhattan, The City of New York, as the Company may determine; provided, however, that if the Specified Currency specified above is other than United States dollars and such payment is to be made in the Specified Currency in accordance with the provisions set forth below, such payment will be made by wire transfer of immediately available funds to an account with a bank designated by the holder hereof at least 15 calendar days prior to the Maturity Date, provided that such bank has appropriate facilities therefor and that this Note (and, if applicable, a duly completed repayment election form) is presented and surrendered at the aforementioned office or agency maintained by the Company in time for the Trustee to make such payment in such funds in accordance with its normal procedures. Payment of interest due on any Interest Payment Date other than the Maturity Date will be made at the aforementioned office or agency maintained by the Company or, at the option of the Company, by check mailed to the address of the person entitled thereto as such address shall appear in the Security Register maintained by the Trustee; provided, however, that a holder of U.S. $10,000,000 (or, if the Specified Currency is other than United States dollars, the equivalent thereof in the Specified Currency) or more in aggregate principal amount of Notes (whether having identical or different terms and provisions) will be entitled to receive interest payments on any Interest Payment Date other than the Maturity Date by wire transfer of immediately available funds if appropriate wire transfer instructions have been received in writing by the Trustee not less than 15 calendar days prior to such Interest Payment Date. Any such wire transfer instructions received by the Trustee shall remain in effect until revoked by such holder. If any Interest Payment Date or the Maturity Date falls on a day that is not a Business Day, the required payment of principal, premium, if any, and/or interest shall be made on the next succeeding Business Day with the same force and effect as if made on the date such payment was due, and no interest shall accrue with respect to such payment for the period from and after such Interest Payment Date or the Maturity Date, as the case may be, to the date of such payment on the next succeeding Business Day. As used herein, "Business Day" means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions are authorized or required by law, regulation or executive order to close in The City of New York or Chicago, Illinois; provided, however, that if the Specified Currency is other than United States dollars, such day is also not a day on which banking institutions are authorized or required by law, regulation or executive order to close in the Principal Financial Center (as defined below) of the country issuing the Specified Currency (unless the Specified Currency is European Currency Units ("ECU"), in which case such day is also not a day that appears as an ECU non-settlement day on the display designated as "ISDE" on the Reuter Monitor Money Rates Service (or a day so designated by the ECU Banking Association) or, if ECU non-settlement days do not appear on that page (and are not so designated), a day that is not a day on which payments in ECU cannot be settled in the international interbank market); provided that, with respect to Notes as to which LIBOR is an applicable Interest Rate Basis, such day is also a London Business Day (as defined below). "London Business Day" means any day on which dealings in the Designated LIBOR Currency (as defined below) are transacted in the London interbank market. "Principal Financial Center" means (i) the capital city of the country issuing the Specified Currency (except as described in the immediately preceding sentence with respect to ECU) or (ii) the capital city of the country which the Designated LIBOR Currency, if applicable, relates (or, in the case of ECU, Luxembourg), except, in each case, that with respect to United States dollars, Australian dollars, Canadian dollars, Deutsche marks, Dutch guilders, Italian lire, Swiss francs and ECUs, the "Principal Financial Center" shall be The City of New York, Sydney, Toronto, Frankfurt, Amsterdam, Milan (solely in the case of clause (i) above), Zurich and Luxembourg, respectively. The Company is obligated to make payments of principal, premium, if any, and interest in respect of this Note in the Specified Currency (or, if the Specified Currency is not at the time of such payment legal tender for the payment of public and private debts, in such other coin or currency of the country which issued the Specified Currency as at the time of such payment is legal tender for the payment of such debts). If the Specified Currency is other than United States dollars, except as provided below, any such amounts so payable by the Company will be converted by the Exchange Rate Agent specified above into United States dollars for payment to the holder of this Note. If the Specified Currency is other than United States dollars, the holder of this Note may elect to receive such amounts in such Specified Currency. If the holder of this Note shall not have duly made an election to receive all or a specified portion of any payment of principal, premium, if any, and/or interest in respect of this Note in the Specified Currency, any United States dollar amount to be received by the holder of this Note will be based on the highest bid quotation in The City of New York received by the Exchange Rate Agent at approximately 11:00 A.M., New York City time, on the second Business Day preceding the applicable payment date from three recognized foreign exchange dealers (one of whom may be the Exchange Rate Agent) selected by the Exchange Rate Agent and approved by the Company for the purchase by the quoting dealer of the Specified Currency for United States dollars for settlement on such payment date in the aggregate amount of the Specified Currency payable to all holders of Notes payable in the Specified Currency who are scheduled to receive United States dollar payments and at which the applicable dealer commits to execute a contract. All currency exchange costs will be borne by the holder of this Note by deductions from such payments. If three such bid quotations are not available, payments on this Note will be made in the Specified Currency unless the Specified Currency is not available due to the imposition of exchange controls or other circumstances beyond the control of the Company. If the Specified Currency is other than United States dollars, the holder of this Note may elect to receive all or a specified portion of any payment of principal, premium, if any, and/or interest in respect of this Note in the Specified Currency by submitting a written request for such payment to the Trustee at its corporate trust office in The City of New York on or prior to the applicable Record Date or at least 15 calendar days prior to the Maturity Date, as the case may be. Such written request may be mailed or hand delivered or sent by cable, telex or other form of facsimile transmission. The holder of this Note may elect to receive all or a specified portion of all future payments in the Specified Currency in respect of such principal, premium, if any, and/or interest and need not file a separate election for each payment. Such election will remain in effect until revoked by written notice to the Trustee, but written notice of any such revocation must be received by the Trustee on or prior to the applicable Record Date or at least 15 calendar days prior to the Maturity Date, as the case may be. If the Specified Currency is other than United States dollars or a composite currency and the holder of this Note shall have duly made an election to receive all or a specified portion of any payment of principal, premium, if any, and/or interest in respect of this Note in the Specified Currency and if the Specified Currency is not available due to the imposition of exchange controls or other circumstances beyond the control of the Company, the Company will be entitled to satisfy its obligations to the holder of this Note by making such payment in United States dollars on the basis of the Market Exchange Rate (as defined below), computed by the Exchange Rate Agent, on the second Business Day prior to such payment date or, if such Market Exchange Rate is not then available, on the basis of the most recently available Market Exchange Rate, or as otherwise specified on the face hereof. The "Market Exchange Rate" for the Specified Currency means the noon dollar buying rate in The City of New York for cable transfers for the Specified Currency as certified for customs purposes by (or, if not so certified, as otherwise determined by) the Federal Reserve Bank of New York. Any payment made under such circumstances in United States dollars will not constitute an Event of Default (as defined in the Indenture) with respect to this Note. If the Specified Currency is a composite currency and the holder of this Note shall have duly made an election to receive all or a specified portion of any payment of principal, premium, if any, and/or interest in respect of this Note in the Specified Currency and if such composite currency is unavailable due to the imposition of exchange controls or other circumstances beyond the control of the Company, then the Company will be entitled to satisfy its obligations to the holder of this Note by making such payment in United States dollars on the basis of the equivalent of the composite currency in United States dollars. The component currencies of the composite currency for this purpose (collectively, the "Component Currencies" and each, a "Component Currency") shall be the currency amounts that were components of the composite currency as of the last day on which the composite currency was used. The equivalent of the composite currency in United States dollars shall be calculated by aggregating the United States dollar equivalents of the Component Currencies. The United States dollar equivalent of each of the Component Currencies shall be determined by the Exchange Rate Agent on the basis of the Market Exchange Rate on the second Business Day prior to the required payment, or, if such Market Exchange Rate is not then available, on the basis of the most recently available Market Exchange Rate for each such Component Currency, or as otherwise specified on the face hereof. If the official unit of any Component Currency is altered by way of combination or subdivision, the number of units of the currency as a Component Currency shall be divided or multiplied in the same proportion. If two or more Component Currencies are consolidated into a single currency, the amounts of those currencies as Component Currencies shall be replaced by an amount in such single currency equal to the sum of the amounts of the consolidated Component Currencies expressed in such single currency. If any Component Currency is divided into two or more currencies, the amount of the original Component Currency shall be replaced by the amounts of such two or more currencies, the sum of which shall be equal to the amount of the original Component Currency. All determinations referred to above made by the Exchange Rate Agent shall be at its sole discretion and shall, in the absence of manifest error, be conclusive for all purposes and binding on the holder of this Note. Reference is hereby made to the further provisions of this Note set forth on the reverse hereof and, if so specified above on the face hereof, in the Addendum hereto, which further provisions shall have the same force and effect as if set forth on the face hereof. Notwithstanding any provisions to the contrary contained herein, if the face of this Note specifies that an Addendum is attached hereto or that "Other/Additional Provisions" apply to this Note, this Note shall be subject to the terms set forth in such Addendum or such "Other/Additional Provisions." Unless the Certificate of Authentication hereon has been executed by or on behalf of the Trustee by manual signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. IN WITNESS WHEREOF, Liberty Property Limited Partnership has caused this Note to be duly executed by one of its duly authorized officers. LIBERTY PROPERTY LIMITED PARTNERSHIP By: Liberty Property Trust, its sole general partner By: /s/ Joseph P. Denny - --------------------------------------- Name: Joseph P. Denny Title: President, Chief Operating Officer Dated: October 24, 1997 ATTEST: By: /s/ James J. Bowes - --------------------------------------- Name: James J. Bowes Title: Secretary [Seal] TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By /s/ Mark J. Frye Date: October 24, 1997 - --------------------------------------- Authorized Signatory [REVERSE OF NOTE] LIBERTY PROPERTY LIMITED PARTNERSHIP MEDIUM-TERM NOTE (Fixed Rate) This Note is one of a duly authorized series of Securities (the "Securities") of the Company issued and to be issued under an Indenture, dated as of October 24, 1997, as amended, modified or supplemented from time to time (the "Indenture"), between the Company and The First National Bank of Chicago, as Trustee (the "Trustee," which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Note is one of the series of Securities designated as "Medium-Term Notes Due Nine Months or More from Date of Issue" (the "Notes"). All terms used but not defined in this Note or in an Addendum hereto shall have the meanings assigned to such terms in the Indenture or on the face hereof, as the case may be. This Note is issuable only in registered form without coupons in minimum denominations of U.S. $1,000 and integral multiples thereof or the minimum Authorized Denomination specified on the face hereof. This Note will not be subject to any sinking fund and, unless otherwise specified on the face hereof in accordance with the provisions of the following two paragraphs, will not be redeemable or repayable prior to the Stated Maturity Date. This Note will be subject to redemption at the option of the Company on any date on or after the Initial Redemption Date, if any, specified on the face hereof, in whole or from time to time in part in increments of U.S. $1,000 or the minimum Authorized Denomination (provided that any remaining principal amount hereof shall be at least U.S. $1,000 or such minimum Authorized Denomination), at the Redemption Price (as defined below), together with unpaid interest accrued thereon to the date fixed for redemption (each, a "Redemption Date"), on written notice given to the holder hereof not more than 60 nor less than 30 calendar days prior to the Redemption Date and in accordance with the provisions of the Indenture. The "Redemption Price," if any, shall initially be the Initial Redemption Percentage specified on the face hereof multiplied by the unpaid principal amount of this Note to be redeemed. The Initial Redemption Percentage, if any, shall decline at each anniversary of the Initial Redemption Date by the Annual Redemption Percentage Reduction, if any, specified on the face hereof until the Redemption Price is 100% of the unpaid principal amount to be redeemed. In the event of redemption of this Note in part only, a new Note of like tenor for the unredeemed portion hereof and otherwise having the same terms as this Note shall be issued in the name of the holder hereof upon the presentation and surrender hereof. This Note will be subject to repayment by the Company at the option of the holder hereof on the Optional Repayment Date(s), if any, specified on the face hereof, in whole or in part in increments of U.S. $1,000 or the minimum Authorized Denomination (provided that any remaining principal amount hereof shall be at least U.S. $1,000 or such minimum Authorized Denomination), at a repayment price equal to 100% of the unpaid principal amount to be repaid, together with unpaid interest accrued thereon to the date fixed for repayment (each, a "Repayment Date"). If an Optional Repayment Date is not set forth on the face hereof, this Note will not be repayable at the option of the holder hereof prior to Maturity. For this Note to be repaid, the Trustee must receive at its office in the Borough of Manhattan, The City of New York, referred to on the face hereof, at least 30 days but not more than 60 days prior to the Repayment Date this Note and the form hereon entitled "Option to Elect Repayment" duly completed. Exercise of such repayment option by the holder hereof will be irrevocable. In the event of repayment of this Note in part only, a new Note of like tenor for the unrepaid portion hereof and otherwise having the same terms as this Note shall be issued in the name of the holder hereof upon the presentation and surrender hereof. If this Note is a Discount Note as specified on the face hereof, the amount payable to the holder of this Note in the event of redemption, repayment or acceleration of maturity of this Note will be equal to the sum of (i) the Issue Price specified on the face hereof (increased by any accruals of the Discount, as defined below) and, in the event of any redemption of this Note (if applicable), multiplied by the Initial Redemption Percentage (as adjusted by the Annual Redemption Percentage Reduction, if applicable) and (ii) any unpaid interest on this Note accrued from the Original Issue Date to the Redemption Date, Repayment Date or date of acceleration of maturity, as the case may be. The difference between the Issue Price and 100% of the principal amount of this Note is referred to herein as the "Discount." For purposes of determining the amount of Discount that has accrued as of any Redemption Date, Repayment Date or date of acceleration of maturity of this Note, such Discount will be accrued so as to cause the yield on the Note to be constant. The constant yield will be calculated using a 30-day month, 360-day year convention, a compounding period that, except for the Initial Period (as defined below), corresponds to the shortest period between Interest Payment Dates (with ratable accruals within a compounding period), and an assumption that the maturity of this Note will not be accelerated. If the period from the Original Issue Date to the initial Interest Payment Date (the "Initial Period") is shorter than the compounding period for this Note, a proportionate amount of the yield for an entire compounding period will be accrued. If the Initial Period is longer than the compounding period, then such period will be divided into a regular compounding period and a short period, with the short period being treated as provided in the preceding sentence. If an Event of Default, as defined in the Indenture, shall occur and be continuing, the principal of and premium (if any) and interest on the Notes either shall automatically become or may be declared due and payable in the manner and with the effect provided in the Indenture. The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of the Company on this Note and (b) certain restrictive covenants and the related defaults and Events of Default applicable to the Company, in each case, upon compliance by the Company with certain conditions set forth in the Indenture, which provisions apply to this Note. As provided in and subject to the provisions of the Indenture, the holder of this Note shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy hereunder, unless (i) such holder shall have previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of this series, (ii) the holders of not less than 25% in principal amount of the Securities of this series at the time Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee, (iii) such holder or holders have offered reasonable indemnity satisfactory to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request, (iv) the Trustee shall have failed to institute any such proceeding for 60 days after its receipt of such notice, request and offer of indemnity, and (v) the Trustee shall not have received, during the 60- day period referenced in clause (iv) above, from the holders of a majority in principal amount of Securities of this series at the time Outstanding in a direction inconsistent with such request; provided that, no one or more holder shall have any right in any manner whatever by virtue of, or by availing of, any provision of the Indenture to affect, disturb or prejudice the rights of any other holder, or to obtain or to seek to obtain priority or preference over any other holder or to enforce any right under the Indenture, except in the manner therein provided and for the equal and ratable benefit of all holders. The foregoing shall not apply to any suit instituted by the holder of this Note for the enforcement of any payment of principal hereof (and premium or Make-Whole Amount, if any) or any interest thereon on or after the respective due dates expressed herein. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the holders of the Securities at any time by the Company and the Trustee with the consent of the holders of not less than a majority of the aggregate principal amount of all Securities at the time outstanding and affected thereby. The Indenture also contains provisions permitting the holders of not less than a majority of the aggregate principal amount of the outstanding Securities of any series, on behalf of the holders of all such Securities, to waive compliance by the Company with certain provisions of the Indenture. Furthermore, provisions in the Indenture permit the holders of not less than a majority of the aggregate principal amount of the outstanding Securities of any series, in certain instances, to waive, on behalf of all of the holders of Securities of such series, certain past defaults under the Indenture and their consequences. Any such consent or waiver by the holder of this Note shall be conclusive and binding upon such holder and upon all future holders of this Note and other Notes issued upon the registration of transfer hereof or in exchange heretofore or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay principal, premium, if any, and interest in respect of this Note at the times, places and rate or formula, and in the coin or currency, herein prescribed. As provided in the Indenture and subject to certain limitations therein and herein set forth, the transfer of this Note is registrable in the Security Register of the Company upon surrender of this Note for registration of transfer at the office or agency of the Company in any place where the principal hereof and any premium or interest hereon are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the holder hereof or by his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. As provided in the Indenture and subject to certain limitations therein and herein set forth, this Note is exchangeable for a like aggregate principal amount of Notes of different authorized denominations but otherwise having the same terms and conditions, as requested by the holder hereof surrendering the same. No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. Prior to due presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the holder in whose name this Note is registered as the owner thereof for all purposes, whether or not this Note be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary. No recourse under or upon any obligation, covenant or agreement contained in the Indenture or in this Note, or because of any indebtedness evidenced thereby or hereby, (including without limitation, any obligation or indebtedness relating to the principal of, or premium or Make-Whole Amount, if any, interest or any other amounts due, or claimed to be due, on this Security), or for any claim based thereon or otherwise in respect thereof, shall be had (i) against Liberty Property Trust or any other partner of the Company, (ii) against any person which owns an interest, directly or indirectly, in any partner in the Company, or (iii) against any promoter, as such or, against any past, present or future stockholder, partner, officer or director, as such, of the Company or of any successor, either directly or through the Company or any successor, under any rule of law, statue or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of this Note by the holder thereof and as part of the consideration for the issue of the Securities of this series. The holder of this Security acknowledges by acceptance of this Security that its sole remedies under the Indenture for any Default by the Company in the payment of principal of, or any premium or Make-Whole Amount, if any, interest or any amounts due, or claimed to be due, on this Security, or otherwise, are limited to claims against the property of the Company as provided in Sections 111 and 503 of the Indenture. THE INDENTURE AND THE SECURITIES, INCLUDING THIS NOTE, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused "CUSIP" numbers to be printed on the Securities of this series as a convenience to the holders of such Securities. No representation is made as to the correctness or accuracy of such CUSIP numbers as printed on the Securities, and reliance may be placed only on the other identification numbers printed hereon. ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this Note, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COMM -as tenants in common TEN ENT -as tenants by the entities JT TEN -as joint tenants with right of survivorship and not as tenants in common /UNIF GIFT MIN ACT - Custodian - ---------- ------------ (Cust) (Minor) Under Uniform Gifts to Minors Act -------------------------------------- (State) Additional abbreviations may also be used though not in the above list. ASSIGNMENT --------------------------------------- Please insert social security or other identifying number of assignee. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto (Please print or typewrite name and address including postal zip code of assignee) the within Note and all rights thereunder hereby irrevocably constituting and appointing ---------------------------------------, attorney to transfer said Note on the books of the Trustee, with full power of substitution in the premises. Dated: , 199__ - --------------------------------------- Notice: The signature(s) on this Assignment must correspond with the name(s) as written upon the face of this Note in every particular, without alteration or enlargement or any change whatsoever. Signature must be guaranteed by an "eligible guarantor institution," that is, a bank, stockbroker, savings and loan association or credit union meeting the requirements of the Registrar, which requirements include membership or participation in the Securities Transfer Agents Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. OPTION TO ELECT REPAYMENT The undersigned hereby irrevocably request(s) and instruct(s) the Company to repay this Note (or portion hereof specified below) pursuant to its terms at a price equal to 100% of the principal amount to be repaid, together with unpaid interest accrued hereon to the Repayment Date, to the undersigned, at (Please print or typewrite name and address of the undersigned) For this Note to be repaid, the Trustee must receive at its corporate trust office in the Borough of Manhattan, The City of New York, not more than 60 nor less than 30 calendar days prior to the Repayment Date, this Note with this "Option to Elect Repayment" form duly completed. If less than the entire principal amount of this Note is to be repaid, specify the portion hereof (which shall be increments of U.S. $1,000 (or, if the Specified Currency is other than United States dollars, the minimum Authorized Denomination specified on the face hereof)) which the holder elects to have repaid and specify the denomination or denominations (which shall be an Authorized Denomination) of the Notes to be issued to the holder for the portion of this Note not being repaid (in the absence of any such specification, one such Note will be issued for the portion not being repaid). Principal Amount to be Repaid: $ Date: Notice: The signature(s) on this Option to Elect Repayment must correspond with the name(s) as written upon the face of this Note in every particular, without alteration or enlargement or any change whatsoever. EX-4 5 EXHIBIT 4.8 (FACE OF NOTE) THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE TRANSFERRED TO, OR REGISTERED OR EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE DEPOSITORY OR A NOMINEE THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY SECURITY AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.* UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (DTC), TO THE COMPANY (AS DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.* LIBERTY PROPERTY LIMITED PARTNERSHIP MEDIUM-TERM NOTE (Fixed Rate) REGISTERED CUSIP No.: PRINCIPAL AMOUNT: $ No. FXR 2 531117EAB4 50,000,000 ORIGINAL ISSUE DATE: INTEREST RATE: %6.97 STATED MATURITY DATE: 12/11/97 12/11/03 INTEREST PAYMENT DATE(S): DEFAULT RATE: % [X] Mar. 15 and Sep. 15 [ ] Other: INITIAL REDEMPTION INITIAL REDEMPTION ANNUAL REDEMPTION DATE: PERCENTAGE: % PERCENTAGE REDUCTION: % OPTIONAL REPAYMENT REPAYMENT PRICE: % [ ] CHECK IF A DISCOUNT DATE(S): 100 NOTE Issue Price: % SPECIFIED CURRENCY: AUTHORIZED DENOMINATION: [X] United States dollars [X] $1,000 and integral [ ] Other: multiples thereof [ ] Other: EXCHANGE RATEEXCHANGE RATE: AGENT:U.S. $1.00 = ADDENDUM ATTACHED:OTHER/ADDITIONAL PROVISIONS: [X] Yes [ ] No * This paragraph applies to global Notes only. Liberty Property Limited Partnership, a Pennsylvania limited partnership (the "Company', which term includes any successor entity under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, upon presentation, the principal sum of $50,000,000 (Fifty Million), on the Stated Maturity Date specified above (or any Redemption Date or Repayment Date, each as defined on the reverse hereof) (each such Stated Maturity Date, Redemption Date or Repayment Date being hereinafter referred to as the "Maturity Date" with respect to the principal repayable on such date) and to pay interest thereon, at the Interest Rate per annum specified above, until the principal hereof is paid or duly made available for payment, and (to the extent that the payment of such interest shall be legally enforceable) at the Default Rate per annum specified above on any overdue principal, premium and/or interest. The Company will pay interest in arrears on each Interest Payment Date, if any, specified above (each, an "Interest Payment Date"), commencing with the first Interest Payment Date next succeeding the Original Issue Date specified above, and on the Maturity Date; provided, however, that if the Original Issue Date occurs between a Record Date (as defined below) and the next succeeding Interest Payment Date, interest payments will commence on the second Interest Payment Date next succeeding the Original Issue Date to the holder of this Note on the Record Date with respect to such second Interest Payment Date. Interest on this Note will be computed on the basis of a 360-day year of twelve 30-day months. Interest on this Note will accrue from, and including, the immediately preceding Interest Payment Date to which interest has been paid or duly provided for (or from, and including, the Original Issue Date if no interest has been paid or duly provided for) to, but excluding, the applicable Interest Payment Date or the Maturity Date, as the case may be (each, an "Interest Period"). The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, subject to certain exceptions described herein, be paid to the person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on the fifteenth calendar day (whether or not a Business Day, as defined below) immediately preceding such Interest Payment Date (the "Record Date"); provided, however, that interest payable on the Maturity Date will be payable to the person to whom the principal hereof and premium, if any, hereon shall be payable. Any such interest not so punctually paid or duly provided for ("Defaulted Interest") will forthwith cease to be payable to the holder on any Record Date, and shall be paid to the person in whose name this Note is registered at the close of business on a special record date (the "Special Record Date") for the payment of such Defaulted Interest to be fixed by the Trustee hereinafter referred to, notice whereof shall be given to the holder of this Note by the Trustee not less than 10 days prior to such Special Record Date or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which this Note may be listed, and upon such notice as may be required by such exchange, all as more fully provided for in the Indenture. Payment of principal, premium, if any, and interest in respect of this Note due on the Maturity Date will be made in immediately available funds upon presentation and surrender of this Note (and, with respect to any applicable repayment of this Note, upon presentation and surrender of this Note and a duly completed election form as contemplated on the reverse hereof) at the office or agency maintained by the Company for that purpose in the Borough of Manhattan, The City of New York, currently the office of the Trustee located at First National Bank of Chicago, c/o First Chicago Trust Company of New York, 14 Wall Street, 8th Floor, New York, New York 10005, or at such other paying agency in the Borough of Manhattan, The City of New York, as the Company may determine; provided, however, that if the Specified Currency specified above is other than United States dollars and such payment is to be made in the Specified Currency in accordance with the provisions set forth below, such payment will be made by wire transfer of immediately available funds to an account with a bank designated by the holder hereof at least 15 calendar days prior to the Maturity Date, provided that such bank has appropriate facilities therefor and that this Note (and, if applicable, a duly completed repayment election form) is presented and surrendered at the aforementioned office or agency maintained by the Company in time for the Trustee to make such payment in such funds in accordance with its normal procedures. Payment of interest due on any Interest Payment Date other than the Maturity Date will be made at the aforementioned office or agency maintained by the Company or, at the option of the Company, by check mailed to the address of the person entitled thereto as such address shall appear in the Security Register maintained by the Trustee; provided, however, that a holder of U.S. $10,000,000 (or, if the Specified Currency is other than United States dollars, the equivalent thereof in the Specified Currency) or more in aggregate principal amount of Notes (whether having identical or different terms and provisions) will be entitled to receive interest payments on any Interest Payment Date other than the Maturity Date by wire transfer of immediately available funds if appropriate wire transfer instructions have been received in writing by the Trustee not less than 15 calendar days prior to such Interest Payment Date. Any such wire transfer instructions received by the Trustee shall remain in effect until revoked by such holder. If any Interest Payment Date or the Maturity Date falls on a day that is not a Business Day, the required payment of principal, premium, if any, and/or interest shall be made on the next succeeding Business Day with the same force and effect as if made on the date such payment was due, and no interest shall accrue with respect to such payment for the period from and after such Interest Payment Date or the Maturity Date, as the case may be, to the date of such payment on the next succeeding Business Day. As used herein, "Business Day" means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions are authorized or required by law, regulation or executive order to close in The City of New York or Chicago, Illinois; provided, however, that if the Specified Currency is other than United States dollars, such day is also not a day on which banking institutions are authorized or required by law, regulation or executive order to close in the Principal Financial Center (as defined below) of the country issuing the Specified Currency (unless the Specified Currency is European Currency Units ("ECU"), in which case such day is also not a day that appears as an ECU non-settlement day on the display designated as "ISDE" on the Reuter Monitor Money Rates Service (or a day so designated by the ECU Banking Association) or, if ECU non-settlement days do not appear on that page (and are not so designated), a day that is not a day on which payments in ECU cannot be settled in the international interbank market); provided that, with respect to Notes as to which LIBOR is an applicable Interest Rate Basis, such day is also a London Business Day (as defined below). "London Business Day" means any day on which dealings in the Designated LIBOR Currency (as defined below) are transacted in the London interbank market. "Principal Financial Center" means (i) the capital city of the country issuing the Specified Currency (except as described in the immediately preceding sentence with respect to ECU) or (ii) the capital city of the country which the Designated LIBOR Currency, if applicable, relates (or, in the case of ECU, Luxembourg), except, in each case, that with respect to United States dollars, Australian dollars, Canadian dollars, Deutsche marks, Dutch guilders, Italian lire, Swiss francs and ECUs, the "Principal Financial Center" shall be The City of New York, Sydney, Toronto, Frankfurt, Amsterdam, Milan (solely in the case of clause (i) above), Zurich and Luxembourg, respectively. The Company is obligated to make payments of principal, premium, if any, and interest in respect of this Note in the Specified Currency (or, if the Specified Currency is not at the time of such payment legal tender for the payment of public and private debts, in such other coin or currency of the country which issued the Specified Currency as at the time of such payment is legal tender for the payment of such debts). If the Specified Currency is other than United States dollars, except as provided below, any such amounts so payable by the Company will be converted by the Exchange Rate Agent specified above into United States dollars for payment to the holder of this Note. If the Specified Currency is other than United States dollars, the holder of this Note may elect to receive such amounts in such Specified Currency. If the holder of this Note shall not have duly made an election to receive all or a specified portion of any payment of principal, premium, if any, and/or interest in respect of this Note in the Specified Currency, any United States dollar amount to be received by the holder of this Note will be based on the highest bid quotation in The City of New York received by the Exchange Rate Agent at approximately 11:00 A.M., New York City time, on the second Business Day preceding the applicable payment date from three recognized foreign exchange dealers (one of whom may be the Exchange Rate Agent) selected by the Exchange Rate Agent and approved by the Company for the purchase by the quoting dealer of the Specified Currency for United States dollars for settlement on such payment date in the aggregate amount of the Specified Currency payable to all holders of Notes payable in the Specified Currency who are scheduled to receive United States dollar payments and at which the applicable dealer commits to execute a contract. All currency exchange costs will be borne by the holder of this Note by deductions from such payments. If three such bid quotations are not available, payments on this Note will be made in the Specified Currency unless the Specified Currency is not available due to the imposition of exchange controls or other circumstances beyond the control of the Company. If the Specified Currency is other than United States dollars, the holder of this Note may elect to receive all or a specified portion of any payment of principal, premium, if any, and/or interest in respect of this Note in the Specified Currency by submitting a written request for such payment to the Trustee at its corporate trust office in The City of New York on or prior to the applicable Record Date or at least 15 calendar days prior to the Maturity Date, as the case may be. Such written request may be mailed or hand delivered or sent by cable, telex or other form of facsimile transmission. The holder of this Note may elect to receive all or a specified portion of all future payments in the Specified Currency in respect of such principal, premium, if any, and/or interest and need not file a separate election for each payment. Such election will remain in effect until revoked by written notice to the Trustee, but written notice of any such revocation must be received by the Trustee on or prior to the applicable Record Date or at least 15 calendar days prior to the Maturity Date, as the case may be. If the Specified Currency is other than United States dollars or a composite currency and the holder of this Note shall have duly made an election to receive all or a specified portion of any payment of principal, premium, if any, and/or interest in respect of this Note in the Specified Currency and if the Specified Currency is not available due to the imposition of exchange controls or other circumstances beyond the control of the Company, the Company will be entitled to satisfy its obligations to the holder of this Note by making such payment in United States dollars on the basis of the Market Exchange Rate (as defined below), computed by the Exchange Rate Agent, on the second Business Day prior to such payment date or, if such Market Exchange Rate is not then available, on the basis of the most recently available Market Exchange Rate, or as otherwise specified on the face hereof. The "Market Exchange Rate" for the Specified Currency means the noon dollar buying rate in The City of New York for cable transfers for the Specified Currency as certified for customs purposes by (or, if not so certified, as otherwise determined by) the Federal Reserve Bank of New York. Any payment made under such circumstances in United States dollars will not constitute an Event of Default (as defined in the Indenture) with respect to this Note. If the Specified Currency is a composite currency and the holder of this Note shall have duly made an election to receive all or a specified portion of any payment of principal, premium, if any, and/or interest in respect of this Note in the Specified Currency and if such composite currency is unavailable due to the imposition of exchange controls or other circumstances beyond the control of the Company, then the Company will be entitled to satisfy its obligations to the holder of this Note by making such payment in United States dollars on the basis of the equivalent of the composite currency in United States dollars. The component currencies of the composite currency for this purpose (collectively, the "Component Currencies" and each, a "Component Currency") shall be the currency amounts that were components of the composite currency as of the last day on which the composite currency was used. The equivalent of the composite currency in United States dollars shall be calculated by aggregating the United States dollar equivalents of the Component Currencies. The United States dollar equivalent of each of the Component Currencies shall be determined by the Exchange Rate Agent on the basis of the Market Exchange Rate on the second Business Day prior to the required payment, or, if such Market Exchange Rate is not then available, on the basis of the most recently available Market Exchange Rate for each such Component Currency, or as otherwise specified on the face hereof. If the official unit of any Component Currency is altered by way of combination or subdivision, the number of units of the currency as a Component Currency shall be divided or multiplied in the same proportion. If two or more Component Currencies are consolidated into a single currency, the amounts of those currencies as Component Currencies shall be replaced by an amount in such single currency equal to the sum of the amounts of the consolidated Component Currencies expressed in such single currency. If any Component Currency is divided into two or more currencies, the amount of the original Component Currency shall be replaced by the amounts of such two or more currencies, the sum of which shall be equal to the amount of the original Component Currency. All determinations referred to above made by the Exchange Rate Agent shall be at its sole discretion and shall, in the absence of manifest error, be conclusive for all purposes and binding on the holder of this Note. Reference is hereby made to the further provisions of this Note set forth on the reverse hereof and, if so specified above on the face hereof, in the Addendum hereto, which further provisions shall have the same force and effect as if set forth on the face hereof. Notwithstanding any provisions to the contrary contained herein, if the face of this Note specifies that an Addendum is attached hereto or that "Other/Additional Provisions" apply to this Note, this Note shall be subject to the terms set forth in such Addendum or such "Other/Additional Provisions". Unless the Certificate of Authentication hereon has been executed by or on behalf of the Trustee by manual signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. IN WITNESS WHEREOF, Liberty Property Limited Partnership has caused this Note to be duly executed by one of its duly authorized officers. LIBERTY PROPERTY LIMITED PARTNERSHIP By: Liberty Property Trust, its sole general partner By: /s/ Joseph P. Denny - --------------------------- Name: Joseph P. Denny Title: President, Chief Operating Officer Dated: October 24, 1997 ATTEST: By: /s/ James J. Bowes - ------------------------- Name: James J. Bowes Title: Secretary [Seal] TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By: /s/ Mark J. Frye Date: October 24, 1997 - ------------------------------- ---------------------- Authorized Signatory [REVERSE OF NOTE] LIBERTY PROPERTY LIMITED PARTNERSHIP MEDIUM-TERM NOTE (Fixed Rate) This Note is one of a duly authorized series of Securities (the "Securities") of the Company issued and to be issued under an Indenture, dated as of October 24, 1997, as amended, modified or supplemented from time to time (the "Indenture"), between the Company and The First National Bank of Chicago, as Trustee (the Trustee, which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Note is one of the series of Securities designated as "Medium-Term Notes Due Nine Months or More from Date of Issue" (the "Notes"). All terms used but not defined in this Note or in an Addendum hereto shall have the meanings assigned to such terms in the Indenture or on the face hereof, as the case may be. This Note is issuable only in registered form without coupons in minimum denominations of U.S. $1,000 and integral multiples thereof or the minimum Authorized Denomination specified on the face hereof. This Note will not be subject to any sinking fund and, unless otherwise specified on the face hereof in accordance with the provisions of the following two paragraphs, will not be redeemable or repayable prior to the Stated Maturity Date. This Note will be subject to redemption at the option of the Company on any date on or after the Initial Redemption Date, if any, specified on the face hereof, in whole or from time to time in part in increments of U.S. $1,000 or the minimum Authorized Denomination (provided that any remaining principal amount hereof shall be at least U.S. $1,000 or such minimum Authorized Denomination), at the Redemption Price (as defined below), together with unpaid interest accrued thereon to the date fixed for redemption (each, a "Redemption Date"), on written notice given to the holder hereof not more than 60 nor less than 30 calendar days prior to the Redemption Date and in accordance with the provisions of the Indenture. The Redemption Price, if any, shall initially be the Initial Redemption Percentage specified on the face hereof multiplied by the unpaid principal amount of this Note to be redeemed. The Initial Redemption Percentage, if any, shall decline at each anniversary of the Initial Redemption Date by the Annual Redemption Percentage Reduction, if any, specified on the face hereof until the Redemption Price is 100% of the unpaid principal amount to be redeemed. In the event of redemption of this Note in part only, a new Note of like tenor for the unredeemed portion hereof and otherwise having the same terms as this Note shall be issued in the name of the holder hereof upon the presentation and surrender hereof. This Note will be subject to repayment by the Company at the option of the holder hereof on the Optional Repayment Date(s), if any, specified on the face hereof, in whole or in part in increments of U.S. $1,000 or the minimum Authorized Denomination (provided that any remaining principal amount hereof shall be at least U.S. $1,000 or such minimum Authorized Denomination), at a repayment price equal to 100% of the unpaid principal amount to be repaid, together with unpaid interest accrued thereon to the date fixed for repayment (each, a "Repayment Date"). If an Optional Repayment Date is not set forth on the face hereof, this Note will not be repayable at the option of the holder hereof prior to Maturity. For this Note to be repaid, the Trustee must receive at its office in the Borough of Manhattan, The City of New York, referred to on the face hereof, at least 30 days but not more than 60 days prior to the Repayment Date this Note and the form hereon entitled "Option to Elect Repayment" duly completed. Exercise of such repayment option by the holder hereof will be irrevocable. In the event of repayment of this Note in part only, a new Note of like tenor for the unrepaid portion hereof and otherwise having the same terms as this Note shall be issued in the name of the holder hereof upon the presentation and surrender hereof. If this Note is a Discount Note as specified on the face hereof, the amount payable to the holder of this Note in the event of redemption, repayment or acceleration of maturity of this Note will be equal to the sum of (i) the Issue Price specified on the face hereof (increased by any accruals of the Discount, as defined below) and, in the event of any redemption of this Note (if applicable), multiplied by the Initial Redemption Percentage (as adjusted by the Annual Redemption Percentage Reduction, if applicable) and (ii) any unpaid interest on this Note accrued from the Original Issue Date to the Redemption Date, Repayment Date or date of acceleration of maturity, as the case may be. The difference between the Issue Price and 100% of the principal amount of this Note is referred to herein as the "Discount". For purposes of determining the amount of Discount that has accrued as of any Redemption Date, Repayment Date or date of acceleration of maturity of this Note, such Discount will be accrued so as to cause the yield on the Note to be constant. The constant yield will be calculated using a 30-day month, 360-day year convention, a compounding period that, except for the Initial Period (as defined below), corresponds to the shortest period between Interest Payment Dates (with ratable accruals within a compounding period), and an assumption that the maturity of this Note will not be accelerated. If the period from the Original Issue Date to the initial Interest Payment Date (the "Initial Period") is shorter than the compounding period for this Note, a proportionate amount of the yield for an entire compounding period will be accrued. If the Initial Period is longer than the compounding period, then such period will be divided into a regular compounding period and a short period, with the short period being treated as provided in the preceding sentence. If an Event of Default, as defined in the Indenture, shall occur and be continuing, the principal of and premium (if any) and interest on the Notes either shall automatically become or may be declared due and payable in the manner and with the effect provided in the Indenture. The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of the Company on this Note and (b) certain restrictive covenants and the related defaults and Events of Default applicable to the Company, in each case, upon compliance by the Company with certain conditions set forth in the Indenture, which provisions apply to this Note. As provided in and subject to the provisions of the Indenture, the holder of this Note shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy hereunder, unless (i) such holder shall have previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of this series, (ii) the holders of not less than 25% in principal amount of the Securities of this series at the time Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee, (iii) such holder or holders have offered reasonable indemnity satisfactory to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request, (iv) the Trustee shall have failed to institute any such proceeding for 60 days after its receipt of such notice, request and offer of indemnity, and (v) the Trustee shall not have received, during the 60- day period referenced in clause (iv) above, from the holders of a majority in principal amount of Securities of this series at the time Outstanding in a direction inconsistent with such request; provided that, no one or more holder shall have any right in any manner whatever by virtue of, or by availing of, any provision of the Indenture to affect, disturb or prejudice the rights of any other holder, or to obtain or to seek to obtain priority or preference over any other holder or to enforce any right under the Indenture, except in the manner therein provided and for the equal and ratable benefit of all holders. The foregoing shall not apply to any suit instituted by the holder of this Note for the enforcement of any payment of principal hereof (and premium or Make-Whole Amount, if any) or any interest thereon on or after the respective due dates expressed herein. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the holders of the Securities at any time by the Company and the Trustee with the consent of the holders of not less than a majority of the aggregate principal amount of all Securities at the time outstanding and affected thereby. The Indenture also contains provisions permitting the holders of not less than a majority of the aggregate principal amount of the outstanding Securities of any series, on behalf of the holders of all such Securities, to waive compliance by the Company with certain provisions of the Indenture. Furthermore, provisions in the Indenture permit the holders of not less than a majority of the aggregate principal amount of the outstanding Securities of any series, in certain instances, to waive, on behalf of all of the holders of Securities of such series, certain past defaults under the Indenture and their consequences. Any such consent or waiver by the holder of this Note shall be conclusive and binding upon such holder and upon all future holders of this Note and other Notes issued upon the registration of transfer hereof or in exchange heretofore or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay principal, premium, if any, and interest in respect of this Note at the times, places and rate or formula, and in the coin or currency, herein prescribed. As provided in the Indenture and subject to certain limitations therein and herein set forth, the transfer of this Note is registrable in the Security Register of the Company upon surrender of this Note for registration of transfer at the office or agency of the Company in any place where the principal hereof and any premium or interest hereon are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the holder hereof or by his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. As provided in the Indenture and subject to certain limitations therein and herein set forth, this Note is exchangeable for a like aggregate principal amount of Notes of different authorized denominations but otherwise having the same terms and conditions, as requested by the holder hereof surrendering the same. No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. Prior to due presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the holder in whose name this Note is registered as the owner thereof for all purposes, whether or not this Note be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary. No recourse under or upon any obligation, covenant or agreement contained in the Indenture or in this Note, or because of any indebtedness evidenced thereby or hereby, (including without limitation, any obligation or indebtedness relating to the principal of, or premium or Make-Whole Amount, if any, interest or any other amounts due, or claimed to be due, on this Security), or for any claim based thereon or otherwise in respect thereof, shall be had (i) against Liberty Property Trust or any other partner of the Company, (ii) against any person which owns an interest, directly or indirectly, in any partner in the Company, or (iii) against any promoter, as such or, against any past, present or future stockholder, partner, officer or director, as such, of the Company or of any successor, either directly or through the Company or any successor, under any rule of law, statue or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of this Note by the holder thereof and as part of the consideration for the issue of the Securities of this series. The holder of this Security acknowledges by acceptance of this Security that its sole remedies under the Indenture for any Default by the Company in the payment of principal of, or any premium or Make-Whole Amount, if any, interest or any amounts due, or claimed to be due, on this Security, or otherwise, are limited to claims against the property of the Company as provided in Sections 111 and 503 of the Indenture. THE INDENTURE AND THE SECURITIES, INCLUDING THIS NOTE, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused "CUSIP" numbers to be printed on the Securities of this series as a convenience to the holders of such Securities. No representation is made as to the correctness or accuracy of such CUSIP numbers as printed on the Securities, and reliance may be placed only on the other identification numbers printed hereon. ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this Note, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COMM-as tenants in common TEN ENT -as tenants by the entities JT TEN -as joint tenants with right of survivorship and not as tenants in common /UNIF GIFT MIN ACT - Custodian - --------- ---------- (Cust) (Minor) Under Uniform Gifts to Minors Act ------------------------- (State) Additional abbreviations may also be used though not in the above list. - --------------------------------------- ASSIGNMENT Please insert social security or other identifying number of assignee. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto (Please print or typewrite name and address including postal zip code of assignee) the within Note and all rights thereunder hereby irrevocably constituting and appointing -------------------------------------, attorney to transfer said Note on the books of the Trustee, with full power of substitution in the premises. Dated: , 199 --------- --- Notice: The signature(s) on this Assignment must correspond with the name(s) as written upon the face of this Note in every particular, without alteration or enlargement or any change whatsoever. Signature must be guaranteed by an eligible guarantor institution, that is, a bank, stockbroker, savings and loan association or credit union meeting the requirements of the Registrar, which requirements include membership or participation in the Securities Transfer Agents Medallion Program (STAMP) or such other signature guarantee program as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. OPTION TO ELECT REPAYMENT The undersigned hereby irrevocably request(s) and instruct(s) the Company to repay this Note (or portion hereof specified below) pursuant to its terms at a price equal to 100% of the principal amount to be repaid, together with unpaid interest accrued hereon to the Repayment Date, to the undersigned, at (Please print or typewrite name and address of the undersigned) For this Note to be repaid, the Trustee must receive at its corporate trust office in the Borough of Manhattan, The City of New York, not more than 60 nor less than 30 calendar days prior to the Repayment Date, this Note with this Option to Elect Repayment form duly completed. If less than the entire principal amount of this Note is to be repaid, specify the portion hereof (which shall be increments of U.S. $1,000 (or, if the Specified Currency is other than United States dollars, the minimum Authorized Denomination specified on the face hereof)) which the holder elects to have repaid and specify the denomination or denominations (which shall be an Authorized Denomination) of the Notes to be issued to the holder for the portion of this Note not being repaid (in the absence of any such specification, one such Note will be issued for the portion not being repaid). Principal Amount to be Repaid: $ Date: - --------------------------------------- Notice: The signature(s) on this Option to Elect Repayment must correspond with the name(s) as written upon the face of this Note in every particular, without alteration or enlargement or any change whatsoever. DSB:486179.1 EX-21 6 Exhibit 21.1 LIBERTY PROPERTY TRUST LIBERTY PROPERTY LIMITED PARTNERSHIP LIST OF SUBSIDIARIES Rouse & Associates - 1655 Valley Center Parkway Limited Partnership Rouse & Associates - 931 South Matlack Street Limited Partnership Rouse & Associates - 300 Stonegate Drive Limited Partnership Rouse & Associates - 200 Hedgewood Drive Limited Partnership Rouse & Associates - 100 Hedgewood Drive Limited Partnership 1495 Valley Center Parkway Limited Partnership Rouse & Associates - Great Valley Retail Limited Partnership Rouse & Associates - 300 Hedgewood Drive Limited Partnership Rouse & Associates - 420 Lapp Road Limited Partnership Rouse & Associates - 1 Chelsea Parkway Limited Partnership Rouse & Associates - 3 Chelsea Parkway Limited Partnership Rouse & Associates - 400 Hedgewood Drive Limited Partnership Rouse & Associates - 1550 Valley Center Parkway Limited Partnership Rouse & Associates - 1560 Valley Center Parkway Limited Partnership Rouse & Associates - 14 Lee Boulevard Limited Partnership 500 Chester Field Parkway Limited Partnership 300/400 Chester Field Parkway Limited Partnership Rouse & Associates - 580 Snowdrift Road Limited Partnership Rouse & Associates - 1510 Valley Center Parkway Limited Partnership Rouse & Associates - 1530 Valley Center Parkway Limited Partnership Rouse & Associates - 747 Dresher Road Limited Partnership Rouse & Associates - 200 Stonegate Drive Limited Partnership Great Valley Associates Limited Partnership Rouse & Associates - 974 Marcon Boulevard Limited Partnership Rouse & Associates - 1180 Church Road Limited Partnership Rouse & Associates - 40 Valley Stream Parkway Limited Partnership Rouse & Associates - 50 Valley Stream Parkway Limited Partnership Rouse & Associates - 20 Valley Stream Parkway Limited Partnership Rouse & Associates - 800-860 Town Center Drive Limited Partnership Rouse & Associates - 1610 Medical Drive Limited Partnership Rouse & Associates - 15 Great Valley Parkway Limited Partnership Morehall Associates Limited Partnership Rouse & Associates - 311 Technology Drive Limited Partnership Rouse & Associates - 55 Valley Stream Parkway Limited Partnership Rouse & Associates - 65 Valley Stream Parkway Limited Partnership Rouse & Associates - 508 Lapp Road Limited Partnership Rouse & Associates - 10 Valley Stream Parkway Limited Partnership Rouse & Associates - 333 Phoenixville Pike Limited Partnership Rouse & Associates - 964 Marcon Boulevard Limited Partnership 1566 Medical Drive Associates Limited Partnership Roble Road Associates Limited Partnership Rouse & Associates - 30 Great Valley Parkway Limited Partnership Rouse & Associates - 75 Great Valley Parkway Limited Partnership Rouse & Associates - 35 Great Valley Parkway Limited Partnership Rouse & Associates - 77 Great Valley Parkway Limited Partnership RHW Lehigh Valley Rouse & Associates - Plymouth Meeting Limited Partnership Rouse & Associates - 256 Great Valley Parkway Limited Partnership 2202 Hangar Place Associates Limited Partnership 2201 Hangar Place Associates Limited Partnership Rouse & Associates - 205 Great Valley Parkway Limited Partnership 954 Marcon Boulevard Associates Limited Partnership Rouse & Associates - 14 Great Valley Parkway Limited Partnership Rouse & Associates - XXVII Great Valley Parkway Limited Partnership Rouse & Associates - 333 Technology Drive Limited Partnership Rouse & Associates - 510 Lapp Road Limited Partnership Liberty Lehigh Partnership Liberty Special Purposes Corp. Liberty Property Development Corp. Liberty Property Development Corp. II Lingerfelt Continental Associates Limited Partnership Fox Run Holding Associates Limited Partnership Metro East Executive Terrace Rouse & Associates - Lanham Limited Partnership Liberty Property Philadelphia Corp. Liberty Property Philadelphia Trust Liberty Property Philadelphia Limited Partnership Liberty Property Philadelphia Limited Partnership II EX-23 7 Exhibit 23.1 Consent of Independent Auditors We consent to the incorporation by reference in the Registration Statement (Form S-3 No. 333-43267), the Registration Statement (Form S-3 No. 33-94782), the Registration Statement (Form S-3 No. 333-14139), the Registration Statement (Form S-3 No. 333-22211), the Registration Statement (Form S-8 No. 33-94036) and the Registration Statement (Form S-8 No. 333-44149) and in the related Prospectus of Liberty Property Trust and Liberty Property Limited Partnership of our report dated February 13, 1998 (except Note 13, as to which the date is February 23, 1998), with respect to the consolidated financial statements and schedule of Liberty Property Trust included in this Annual Report (Form 10-K) for the year ended December 31, 1997. Philadelphia, Pennsylvania March 2, 1998 Exhibit 23.2 Consent of Independent Auditors We consent to the incorporation by reference in the Registration Statement (Form S-3 No. 333-43267), the Registration Statement (Form S-3 No. 33-94782) and the Registration Statement (Form S-3 No. 333-22211) and in the related Propectus of Liberty Property Trust and Liberty Property Limited Partnership of our report dated February 13, 1998 (except Note 11, as to which the date is February 23, 1998), with respect to the consolidated financial statements and schedule of Liberty Property Limited Partnership included in this Annual Report (Form 10-K) for the year ended December 31, 1997. Philadelphia, Pennsylvania March 2, 1998 EX-27 8
5 This schedule contains summary financial information extracted from the Consolidated Balance Sheet at December 31, 1997 and the Consolidated Statement of Operations for the year Ended December 31, 1997 and is qualified in its entirety by reference to such financial statements. 0000921112 LIBERTY PROPERTY TRUST 1,000 YEAR DEC-31-1997 JAN-01-1997 DEC-31-1997 55,079 0 6,517 1,603 0 61,596 2,101,355 152,367 2,094,337 25,504 960,134 0 120,814 53 834,728 2,094,337 0 232,517 0 61,079 51,402 0 53,986 66,050 0 66,050 0 0 0 56,197 1.39 1.38
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