8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 8, 2010

LIBERTY PROPERTY TRUST
LIBERTY PROPERTY LIMITED PARTNERSHIP

(Exact name of registrant specified in its charter)

Maryland Pennsylvania	1-13130 1-13132	23-7768996 23-2766549
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

500 Chesterfield Parkway
Malvern, PA	19355
(Address of principal executive offices)	(Zip Code)

Registrants’ telephone, including area code: (610) 648-1700

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

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

o Written communications pursuant to Rule 425 under the Section Act (17 CFR 230.425).

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

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240-14d-2(b)).

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240-13e-4(c)).

Item 2.02. Results of Operations and Financial Condition.

On February 8, 2010, the Registrants issued a press release announcing the Registrants’ financial results for the quarter and year ended December 31, 2009. As set forth below, the Registrants are furnishing the press release as Exhibit 99.1 to this Current Report on Form 8-K.

Item 9.01. Financial Statements and Exhibits.

(a) Financial Statements of Businesses Acquired.

None.

(b) Pro Forma Financial Information.

None.

(c) Shell Company Transactions.

None.

(d) Exhibits.

Exhibit Number		Exhibit Title
	99.1	Press Release by the Registrants, dated February 8, 2010, furnished in accordance with Item 2.02 of this Current Report on Form 8-K.

SIGNATURES

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

LIBERTY PROPERTY TRUST
By:	/s/ George J. Alburger, Jr.
	Name:	George J. Alburger, Jr.
	Title:	Chief Financial Officer
LIBERTY PROPERTY
LIMITED PARTNERSHIP
By:	Liberty Property Trust, its sole
	General Partner
By:	/s/ George J. Alburger, Jr.
	Name:	George J. Alburger, Jr.
	Title:	Chief Financial Officer

Dated: February 9, 2010

EXHIBIT INDEX

Exhibit Number		Exhibit Title
	99.1	Press Release by the Registrants, dated February 8, 2010, furnished in accordance with Item 2.02 of this Current Report on Form 8-K.

EX-99.1

Exhibit 99.1

Press Release

For Immediate Release	Inquiries:	Jeanne A. Leonard
		Liberty Property Trust
		610/648-1704

LIBERTY PROPERTY TRUST ANNOUNCES
FOURTH QUARTER AND FULL YEAR RESULTS

Malvern, PA, February 8, 2010 — Liberty Property Trust (NYSE:LRY) reported that funds from operations available to common shareholders (diluted) (“FFO”) for the fourth quarter of 2009 was a loss of $0.14 per share, compared to a profit of $0.80 per share for the fourth quarter of 2008. FFO for the fourth quarter includes a $94.5 million, non-cash impairment charge related to certain of the company’s investments in unconsolidated joint ventures and related goodwill. Excluding this impairment charge, FFO for the fourth quarter of 2009 would be $0.67 per share. Funds from operations for the fourth quarter also include termination fees of $1.7 million.

For the year ended December 31, 2009, FFO per share was $1.98. Excluding the $94.5 million non-cash impairment charge, FFO for the year ended December 31, 2009 would be $2.83 per share. This compares to FFO of $3.20 per share for 2008.

Net loss per common share (diluted) was $0.46 per share for the quarter ended December 31, 2009, compared to net income of $0.53 per share (diluted) for the quarter ended December 31, 2008. Net income for the full year 2009 was $0.52 per common share, compared with $1.62 per share for 2008. Adjusting for the non-cash impairment charge of $94.5 million, net income for the quarter ended December 31, 2009 would be $0.35 per share, and for the year ended December 31, 2009 it would be $1.37 per share.

“Fourth quarter activity was encouraging,” said Bill Hankowsky, chief executive officer. “At the end of the year we saw a marked increase in the number and quality of industrial prospects, coupled with renewed willingness on the part of companies to make commitments, in both the office and industrial sectors. This translated into very strong leasing performance. We believe that the market has bottomed, we are beginning to see very gradual recovery in the industrial sector, and we may see similar positive signs in the office sector in the second half of this year should the nation’s employment situation improve.”

Portfolio Performance

Leasing: At December 31, 2009, Liberty’s in-service portfolio of 78.2 million square feet was 89.2% occupied, compared to 89.3% at the end of the third quarter. During the quarter, Liberty completed lease transactions totaling 4.7 million square feet of space.

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Liberty Property Trust Fourth Quarter 2009 Earnings -2-

Same Store Performance: Property level operating income for same store properties decreased by 1.4% on a cash basis and by 2.8% on a straight line basis for the fourth quarter of 2009 compared to the same quarter in 2008 and increased by 0.4% on a cash basis and 0.6% on a straight line basis for the full year 2009 compared to 2008.

Capital Activities and Balance Sheet Management

Property Sales: During the fourth quarter, Liberty sold seven operating properties, which contained 543,000 square feet of leaseable space, and 10.1 acres of land for $35.1 million.

Real Estate Investments

Development: During the fourth quarter, Liberty brought into service four development properties totaling 1.1 million square feet for a total investment of $121.4 million. These properties were 96.1% occupied as of December 31, 2009, at a yield of 9.1%.

A joint venture in which the company holds a 25% interest brought into service a 225,000 square foot development property during the quarter. This property is 9.6% leased. The projected stabilized yield on the $12.0 million investment is 7.4%.

No development commenced during the quarter.

As of December 31, 2009, Liberty had 1.0 million square feet of wholly-owned and joint venture properties under development. This activity represents a total projected investment of $243.5 million, with an expected yield of 6.2%. The properties were 34.1% leased at December 31.

Acquisitions: Liberty acquired no properties during the quarter.

About the Company

Liberty Property Trust (NYSE:LRY) is a leader in commercial real estate, serving customers in the United States and United Kingdom, through the development, acquisition, ownership and management of superior office and industrial properties. Liberty’s 78 million square foot portfolio includes more than 700 properties which provide office, distribution and light manufacturing facilities to 2,000 tenants.

Additional information about the Company, including Liberty’s Quarterly Supplemental Package with detailed financial information is available in the Investors section of the Company’s web site at www.libertyproperty.com. If you are unable to access the web site, a copy of the supplemental package may be obtained by contacting Liberty by phone at 610-648-1704, or by e-mail to jleonard@libertyproperty.com.

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Liberty Property Trust Fourth Quarter 2009 Earnings -3-

Liberty will host a conference call during which management will discuss third quarter results, on Tuesday, February 9, 2010, at 1 p.m. eastern time. To access the conference call in the United States or Canada, please dial 1-888-870-2815. For international access, dial 706-643-7691. No password or code is needed. A replay of the call will be available by dialing 1-800-642-1687 for US/Canada participants or 706-645-9291 for international participants. A passcode is needed for the replay: 51828607. The call can also be accessed via the Internet on the Investors page of Liberty’s web site at www.libertyproperty.com for two weeks following the call.

The statements contained in this press release may include forward-looking statements within the meaning of the federal securities law. Although Liberty believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be achieved. As forward-looking statements, these statements involve risks, uncertainties and other factors that could cause actual results to differ materially from the expected results. These factors include, without limitation, the uncertainties affecting real estate businesses generally (such as entry into new leases, renewals of leases and dependence on tenants’ business operations), risks relating to our ability to maintain and increase property occupancy and rental rates, the financial condition of tenants, the uncertainties of real estate development and construction activity, the costs and availability of financing, the effects of local economic and market conditions, regulatory changes, potential liability relative to environmental matters and other risks and uncertainties detailed in the company’s filings with the Securities and Exchange Commission. The company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

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Liberty Property Trust
Statement of Operations
December 31, 2009
(In thousands, except per share amounts)

	Quarter Ended						Year Ended
	December 31, 2009			December 31, 2008			December 31, 2009			December 31, 2008
	(Unaudited)
Operating Revenue
Rental	$	131,842		$	128,649		$	519,928		$	507,698
Operating expense reimbursement		55,735			56,117			224,329			223,654
Total operating revenue		187,577			184,766			744,257			731,352
Operating Expenses
Rental property		40,191			39,101			149,968			149,170
Real estate taxes		20,007			19,682			86,676			83,762
General and administrative		12,792			14,133			51,250			54,467
Depreciation and amortization		42,801			41,757			170,764			169,190
Total operating expenses		115,791			114,673			458,658			456,589
Operating Income		71,786			70,093			285,599			274,763
Other Income/Expense
Interest and other		3,259			4,053			11,503			13,440
Debt extinguishment gain		—			2,521			1,547			2,521
Interest		(38,283	)		(37,844	)		(149,569	)		(152,896	)
Total other income/expense		(35,024	)		(31,270	)		(136,519	)		(136,935	)
Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures		36,762			38,823			149,080			137,828
Gain on property dispositions		626			8,633			1,687			10,572
Income taxes		(64	)		(273	)		(494	)		(1,645	)
Equity in earnings of unconsolidated joint ventures		37			948			2,161			2,805
Impairment charges — investment in unconsolidated joint ventures and other		(79,247	)		—			(82,552	)		—
— goodwill		(15,700	)		—			(15,700	)		—
Income from continuing operations		(57,586	)		48,131			54,182			149,560
Discontinued operations (including net gain on property dispositions of $8,859 and $9,884 for the quarters ended December 31, 2009 and 2008 and $17,859 and $23,519 for the years ended December 31, 2009 and 2008)		8,780			11,248			24,810			30,546
Net Income		(48,806	)		59,379			78,992			180,106
Noncontrolling interest — operating partnerships		(3,393	)		(7,396	)		(23,125	)		(27,681	)
Noncontrolling interest — consolidated joint ventures		112			(185	)		509			(483	)
Net Income available to common shareholders	$	(52,087	)	$	51,798		$	56,376		$	151,942
Basic income per common share
Continuing operations	$	(0.54	)	$	0.42		$	0.30		$	1.31
Discontinued operations	$	0.08		$	0.11		$	0.22		$	0.31
Total basic income per common share	$	(0.46	)	$	0.53		$	0.52		$	1.62
Diluted income per common share
Continuing operations	$	(0.54	)	$	0.42		$	0.30		$	1.31
Discontinued operations	$	0.08		$	0.11		$	0.22		$	0.31
Total diluted income per common share	$	(0.46	)	$	0.53		$	0.52		$	1.62
Weighted average shares
Basic		112,159			97,434			107,550			93,615
Diluted		112,722			97,493			108,002			93,804
Amounts attributable to common shareholders
Income from continuing operations	$	(60,565	)	$	40,995		$	32,444		$	122,688
Discontinued operations		8,478			10,803			23,932			29,254
Net income	$	(52,087	)	$	51,798		$	56,376		$	151,942

Liberty Property Trust
Statement of Funds From Operations
December 31, 2009
(Unaudited and in thousands, except per share amounts)

	Quarter Ended											Year Ended
	December 31, 2009						December 31, 2008					December 31, 2009						December 31, 2008
				Per						Per					Per						Per
				Weighted						Weighted					Weighted						Weighted
				Average						Average					Average						Average
	Dollars			Share			Dollars			Share		Dollars			Share			Dollars			Share
Reconciliation of net income to FFO — basic:
Basic — income available to common shareholders	$	(52,087	)	$	(0.46	)	$	51,798		$	0.53	$	56,376		$	0.52		$	151,942		$	1.62
Adjustments:
Depreciation and amortization of unconsolidated joint ventures		4,067						4,027					16,180						16,235
Depreciation and amortization		42,206						42,597					170,633						173,400
Gain on property dispositions		(8,380	)					(19,662	)				(23,197	)					(34,336	)
Minority interest share in addback for depreciation and amortization and gain on property dispositions		(1,304	)					(1,068	)				(5,801	)					(6,606	)
Funds from operations available to common shareholders — basic	$	(15,498	)	$	(0.14	)	$	77,692		$	0.80	$	214,191		$	1.99		$	300,635		$	3.21
Reconciliation of net income to FFO — diluted:
Diluted — income available to common shareholders	$	(52,087	)	$	(0.46	)	$	51,798		$	0.53	$	56,376		$	0.52		$	151,942		$	1.62
Adjustments:
Depreciation and amortization of unconsolidated joint ventures		4,067						4,027					16,180						16,235
Depreciation and amortization		42,206						42,597					170,633						173,400
Gain on property dispositions		(8,380	)					(19,662	)				(23,197	)					(34,336	)
Minority interest excluding preferred unit distributions		(1,860	)					2,143					2,114						6,669
Funds from operations available to common shareholders — diluted	$	(16,054	)	$	(0.14	)(1)	$	80,903		$	0.80	$	222,106		$	1.98	(1)	$	313,910		$	3.20
Reconciliation of weighted average shares:
Weighted average common shares — all basic calculations		112,159						97,434					107,550						93,615
Dilutive shares for long term compensation plans		563						59					452						189
Diluted shares for net income calculations		112,722						97,493					108,002						93,804
Weighted average common units		4,016						4,189					4,018						4,190
Diluted shares for funds from operations calculations		116,738						101,682					112,020						97,994

(1) Excluding the $94.5 million non-cash impairment charge FFO for the quarter and year ended December 31, 2009 would have been $.67 and $2.83 per share, respectively.

The Company believes that the calculation of Funds from operations is helpful to investors and management as it is a measure of the Company’s operating performance that excludes depreciation and amortization and gains and losses from property dispositions. As a result, year over year comparison of Funds from operations reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses, and interest costs, providing perspective not immediately apparent from net income. In addition, management believes that Funds from operations provides useful information to the investment community about the Company’s financial performance when compared to other REITs since Funds from operations is generally recognized as the standard for reporting the operating performance of a REIT. Funds from operations available to common shareholders is defined by NAREIT as net income (computed in accordance with generally accepted accounting principles (“GAAP”)), excluding gains (or losses) from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Funds from operations available to common shareholders 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 income as an indicator of the Company’s operating performance or to cash flows as a measure of liquidity. Funds from operations available to common shareholders also does not represent cash flows generated from operating, investing or financing activities as defined by GAAP.

Liberty Property Trust
Balance Sheet
December 31, 2009
(In thousands, except share amounts)

	December 31, 2009			December 31, 2008
Assets
Real estate:
Land and land improvements	$	850,559		$	801,763
Building and improvements		4,410,254			4,191,361
Less: accumulated depreciation		(1,093,946	)		(963,043	)
Operating real estate		4,166,867			4,030,081
Development in progress		66,714			245,463
Land held for development		218,633			209,551
Net real estate		4,452,214			4,485,095
Cash and cash equivalents		237,446			15,794
Restricted cash		42,232			39,726
Accounts receivable		4,591			12,985
Deferred rent receivable		95,527			83,033
Deferred financing and leasing costs, net of accumulated amortization (2009, $133,429; 2008, $139,078)		134,309			132,627
Investment in unconsolidated joint ventures		175,584			266,602
Assets held for sale		—			98,706
Prepaid expenses and other assets		85,518			82,467
Total assets	$	5,227,421		$	5,217,035
Liabilities
Mortgage loans	$	473,993		$	198,560
Unsecured notes		1,842,882			2,131,607
Credit facility		140,000			260,000
Accounts payable		31,195			32,481
Accrued interest		31,251			36,474
Dividend and distributions payable		55,402			48,858
Other liabilities		169,529			182,549
Total liabilities		2,744,252			2,890,529
Equity
Shareholders’ equity:
Common shares of beneficial interest, $.001 par value, 183,987,000 shares authorized, 113,875,211 (includes 1,249,909 in treasury) and 100,034,404 (includes 1,249,909 in treasury) shares issued and outstanding as of December 31, 2009 and 2008, respectively		114			101
Additional paid-in capital		2,469,570			2,162,820
Accumulated other comprehensive income		2,339			(5,378	)
Distributions in excess of net income		(337,911	)		(185,721	)
Common shares in treasury, at cost, 1,249,909 shares as of December 31, 2009 and 2008		(51,951	)		(51,951	)
Total shareholders’ equity		2,082,161			1,919,871
Noncontrolling interest — operating partnership
4,011,354 and 4,074,967 common units outstanding as of December 31, 2009 and 2008, respectively		112,428			117,546
9,740,000 preferred units outstanding as of December 31, 2009 and 2008		287,959			287,959
Noncontrolling interest — consolidated joint ventures		621			1,130
Total equity		2,483,169			2,326,506
Total liabilities & equity	$	5,227,421		$	5,217,035