UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, ~~2021.~~2022.


☐☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from _________________ to ________________

Commission File Number 1-12386

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST

(Exact name of registrant as specified in its charter)


Maryland			13-3717318
(State or other jurisdiction of incorporation of organization)			(I.R.S. Employer Identification No.)

One Penn Plaza, Suite 4015, New York, NY 10119-4015

(Address of principal executive offices) (zip code)

(212) 692-7200

(Registrant's telephone number, including area code)

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


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

Indicate by check mark whether the registrant (1) has 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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒☒ No ☐☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒☒ No ☐☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of ~~“large~~“large accelerated filer,~~” “accelerated~~” “accelerated filer,~~” “smaller~~” “smaller reporting company,”” and ~~“emerging~~“emerging growth ~~company”~~company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒☒

Accelerated filer

☐☐

Non-accelerated filer

☐☐

Smaller reporting company

☐☐

Emerging growth

company

☐☐

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐☐ No ☒☒

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date: ~~277,628,373~~286,649,181 common shares of beneficial interest, par value $0.0001 per share, as of May ~~5, 2021.~~

3, 2022.

TABLE OF CONTENTS


PART I. —— FINANCIAL INFORMATION
ITEM 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets						3
Condensed Consolidated Statements of Operations						4
Condensed Consolidated Statements of Comprehensive Income (Loss)						5
Condensed Consolidated Statements of Changes in Equity						6
Condensed Consolidated Statements of Cash Flows						7
Notes to Condensed Consolidated Financial Statements						8
ITEM 2. ~~Management’s~~Management’s Discussion and Analysis of Financial Condition and Results of Operations						25
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk						3334
ITEM 4. Controls and Procedures						3334
PART II —— OTHER INFORMATION
ITEM 1. Legal Proceedings						3435
ITEM 1A. Risk Factors						3435
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds						3435
ITEM 3. Defaults Upon Senior Securities						3435
ITEM 4. Mine Safety Disclosures						3435
ITEM 5. Other Information						3435
ITEM 6. Exhibits						3536
SIGNATURES						3738

WHERE YOU CAN FIND MORE INFORMATION:

We file and furnish annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission, which we refer to as the SEC. You may read and copy any materials that we file or furnish with the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. We file and furnish information electronically with the SEC. The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers that file or furnish electronically with the SEC. The address of the SEC's Internet site is http://www.sec.gov. We also maintain a web site at http://www.lxp.com through which you can obtain copies of documents that we file or furnish with the SEC. The contents of that web site are not incorporated by reference in or otherwise a part of this Quarterly Report on Form 10-Q or any other document that we file or furnish with the SEC.

Table of Contents

PART I. - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

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


	March 31, 2022		December 31, 2021

Assets:
Real estate, at cost	$	3,629,494	$	3,583,978
Real estate - intangible assets	339,216		341,403
Land held for development	104,347		104,160
Investments in real estate under construction	231,258		161,165
Real estate, gross	4,304,315		4,190,706
Less: accumulated depreciation and amortization	683,013		655,740
Real estate, net	3,621,302		3,534,966
Assets held for sale	106,653		82,586
Right-of-use assets, net	26,985		27,966

Cash and cash equivalents	49,063		190,926
Restricted cash	105		101
Investments in non-consolidated entities	73,575		74,559
Deferred expenses, net	21,839		18,861

Rent receivable – current	3,993		3,526
Rent receivable – deferred	66,807		63,283
Other assets	17,224		8,784
Total assets	$	3,987,546	$	4,005,558

Liabilities and Equity:
Liabilities:
Mortgages and notes payable, net	$	80,385	$	83,092

Term loan payable, net	298,572		298,446
Senior notes payable, net	988,272		987,931

Trust preferred securities, net	127,620		127,595
Dividends payable	36,784		37,425
Liabilities held for sale	3,879		3,468
Operating lease liabilities	28,036		29,094
Accounts payable and other liabilities	65,534		77,607
Accrued interest payable	10,249		8,481
Deferred revenue - including below-market leases, net	13,982		14,474
Prepaid rent	13,751		14,717
Total liabilities	1,667,064		1,682,330

Commitments and contingencies	0		0
Equity:
Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares:
Series C Cumulative Convertible Preferred, liquidation preference $96,770; 1,935,400 shares issued and outstanding	94,016		94,016
Common shares, par value $0.0001 per share; authorized 400,000,000 shares, 287,871,649 and 283,752,726 shares issued and outstanding in 2022 and 2021, respectively	29		28
Additional paid-in-capital	3,261,770		3,252,506
Accumulated distributions in excess of net income	(1,074,998)		(1,049,434)
Accumulated other comprehensive income (loss)	6,008		(6,258)
Total shareholders’ equity	2,286,825		2,290,858
Noncontrolling interests	33,657		32,370
Total equity	2,320,482		2,323,228
Total liabilities and equity	$	3,987,546	$	4,005,558

March 31, 2021 December 31, 2020
(unaudited)
Assets:
Real estate, at cost $ 3,523,641 $ 3,514,564
Real estate - intangible assets 399,394 409,293
Investments in real estate under construction 88,374 75,906
Real estate, gross 4,011,409 3,999,763
Less: accumulated depreciation and amortization 891,448 884,465
Real estate, net 3,119,961 3,115,298
Assets held for sale 18,383 16,530
Right-of-use assets, net 30,500 31,423
Cash and cash equivalents 142,074 178,795
Restricted cash 28,101 626
Investments in non-consolidated entities 54,185 56,464
Deferred expenses, net 16,730 15,901
Rent receivable – current 2,954 2,899
Rent receivable – deferred 66,680 66,959
Other assets 10,665 8,331
Total assets $ 3,490,233 $ 3,493,226
Liabilities and Equity:
Liabilities:
Mortgages and notes payable, net $ 131,849 $ 136,529
Term loan payable, net 298,069 297,943
Senior notes payable, net 779,607 779,275
Trust preferred securities, net 127,520 127,495
Dividends payable 33,317 35,401
Liabilities held for sale 6 790
Operating lease liabilities 31,508 32,515
Accounts payable and other liabilities 45,018 55,208
Accrued interest payable 7,221 6,334
Deferred revenue - including below-market leases, net 16,680 17,264
Prepaid rent 14,112 13,335
Total liabilities 1,484,907 1,502,089
Commitments and contingencies 0 0
Equity:
Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares:
Series C Cumulative Convertible Preferred, liquidation preference $96,770; 1,935,400 shares issued and outstanding 94,016 94,016
Common shares, par value $0.0001 per share; authorized 400,000,000 shares, 277,614,856 and 277,152,450 shares issued and outstanding in 2021 and 2020, respectively 28 28
Additional paid-in-capital 3,193,023 3,196,315
Accumulated distributions in excess of net income (1,292,051) (1,301,726)
Accumulated other comprehensive loss (12,617) (17,963)
Total shareholders’ equity 1,982,399 1,970,670
Noncontrolling interests 22,927 20,467
Total equity 2,005,326 1,991,137
Total liabilities and equity $ 3,490,233 $ 3,493,226

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Content

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

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


	Three Months Ended March 31,
	2022		2021
Gross revenues:
Rental revenue	$	78,536	$	91,645


Other revenue	1,742		912
Total gross revenues	80,278		92,557
Expense applicable to revenues:
Depreciation and amortization	(44,506)		(42,176)
Property operating	(14,616)		(10,934)
General and administrative	(10,737)		(8,420)
Non-operating income	32		477
Interest and amortization expense	(10,682)		(11,486)




Gains on sales of properties	255		21,919
Income before provision for income taxes and equity in earnings (losses) of non-consolidated entities	24		41,937
Provision for income taxes	(417)		(372)
Equity in earnings (losses) of non-consolidated entities	11,301		(90)








Net income	10,908		41,475
Less net income attributable to noncontrolling interests	(286)		(433)
Net income attributable to LXP Industrial Trust shareholders	10,622		41,042
Dividends attributable to preferred shares – Series C	(1,572)		(1,572)
Allocation to participating securities	(61)		(69)
Net income attributable to common shareholders	$	8,989	$	39,401

Net income attributable to common shareholders - per common share basic	$	0.03	$	0.14


Weighted-average common shares outstanding – basic	283,640,465		275,416,327

Net income attributable to common shareholders - per common share diluted	$	0.03	$	0.14


Weighted-average common shares outstanding – diluted	289,067,778		279,053,697

Three Months Ended March 31,
2021 2020
Gross revenues:
Rental revenue $ 91,645 $ 78,735
Other revenue 912 2,092
Total gross revenues 92,557 80,827
Expense applicable to revenues:
Depreciation and amortization (42,176) (40,509)
Property operating (10,934) (10,276)
General and administrative (8,420) (7,825)
Non-operating income 477 190
Interest and amortization expense (11,486) (14,795)
Debt satisfaction gains, net 0 1,393
Gains on sales of properties 21,919 9,805
Income before provision for income taxes and equity in earnings (losses) of non-consolidated entities 41,937 18,810
Provision for income taxes (372) (653)
Equity in earnings (losses) of non-consolidated entities (90) 263
Net income 41,475 18,420
Less net income attributable to noncontrolling interests (433) (266)
Net income attributable to Lexington Realty Trust shareholders 41,042 18,154
Dividends attributable to preferred shares – Series C (1,572) (1,572)
Allocation to participating securities (69) (46)
Net income attributable to common shareholders $ 39,401 $ 16,536

Net income attributable to common shareholders - per common share basic $ 0.14 $ 0.07
Weighted-average common shares outstanding – basic 275,416,327 253,038,161
Net income attributable to common shareholders - per common share diluted $ 0.14 $ 0.06
Weighted-average common shares outstanding – diluted 279,053,697 257,347,277

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Content

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited and in thousands)


	Three Months Ended March 31,
	2022		2021
Net income	$	10,908	$	41,475
Other comprehensive income:

Change in unrealized income on interest rate swaps, net	12,266		5,346
Other comprehensive income	12,266		5,346
Comprehensive income	23,174		46,821
Comprehensive income attributable to noncontrolling interests	(286)		(433)
Comprehensive income attributable to LXP Industrial Trust shareholders	$	22,888	$	46,388

Three Months Ended March 31,
2021 2020
Net income $ 41,475 $ 18,420
Other comprehensive income (loss):
Change in unrealized income (loss) on interest rate swaps, net 5,346 (16,996)
Other comprehensive income (loss) 5,346 (16,996)
Comprehensive income 46,821 1,424
Comprehensive income attributable to noncontrolling interests (433) (266)
Comprehensive income attributable to Lexington Realty Trust shareholders $ 46,388 $ 1,158

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Content

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited and in thousands)


Three Months Ended March 31, 2021				Lexington Realty Trust Shareholders
Three Months Ended March 31, 2022																Three Months Ended March 31, 2022			LXP Industrial Trust Shareholders
		Total		Preferred Shares		Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Loss		Noncontrolling Interests			Total		Number of Preferred Shares	Preferred Shares		Number of Common Shares	Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Income/(Loss)		Noncontrolling Interests
Balance December 31, 2020		$	1,991,137	$	94,016	$	28	$	3,196,315	$	(1,301,726)	$	(17,963)	$	20,467
Balance December 31, 2021																Balance December 31, 2021	$	2,323,228	1,935,400	$	94,016	283,752,726	$	28	$	3,252,506	$	(1,049,434)	$	(6,258)	$	32,370
Issuance of partnership interest in real estate	Issuance of partnership interest in real estate	2,712		—		—		—		—		—		2,712		Issuance of partnership interest in real estate	4,109		—	—		—	—		—		—		—		4,109
Redemption of noncontrolling OP units for common shares	Redemption of noncontrolling OP units for common shares	—		—		—		311		—		—		(311)		Redemption of noncontrolling OP units for common shares	—		—	—		6,708	—		36		—		—		(36)
Purchase of noncontrolling interest in consolidated joint venture																Purchase of noncontrolling interest in consolidated joint venture	(27,958)		—	—		—	—		(25,058)		—		—		(2,900)
Issuance of common shares and deferred compensation amortization, net	Issuance of common shares and deferred compensation amortization, net	1,517		—		—		1,517		—		—		—		Issuance of common shares and deferred compensation amortization, net	40,572		—	—		4,523,173	1		40,571		—		—		—
Repurchase of common shares to settle tax obligations	Repurchase of common shares to settle tax obligations	(5,120)		—		—		(5,120)		—		—		—		Repurchase of common shares to settle tax obligations	(6,285)		—	—		(410,958)	—		(6,285)		—		—		—
Forfeiture of employee common shares		2		—		—		—		2		—		—
Dividends/distributions		(31,743)		—		—		—		(31,369)		—		(374)

Dividends/distributions ($0.12 per common share)																Dividends/distributions ($0.12 per common share)	(36,358)		—	—		—	—		—		(36,186)		—		(172)
Net income	Net income	41,475		—		—		—		41,042		—		433		Net income	10,908		—	—		—	—		—		10,622		—		286
Other comprehensive income	Other comprehensive income	5,346		—		—		—		—		5,346		—		Other comprehensive income	12,266		—	—		—	—		—		—		12,266		—
Balance March 31, 2021		$	2,005,326	$	94,016	$	28	$	3,193,023	$	(1,292,051)	$	(12,617)	$	22,927

Balance March 31, 2022																Balance March 31, 2022	$	2,320,482	1,935,400	$	94,016	287,871,649	$	29	$	3,261,770	$	(1,074,998)	$	6,008	$	33,657

Three Months Ended March 31, 2020 Lexington Realty Trust Shareholders
Total Preferred Shares Common Shares Additional Paid-in-Capital Accumulated Distributions in Excess of Net Income Accumulated Other Comprehensive Loss Noncontrolling Interests
Balance December 31, 2019 $ 1,724,719 $ 94,016 $ 25 $ 2,976,670 $ (1,363,676) $ (1,928) $ 19,612
Issuance of partnership interest in real estate 421 — — — — — 421
Redemption of noncontrolling OP units for common shares — — — 428 — — (428)
Issuance of common shares and deferred compensation amortization, net 18,931 — 1 18,930 — — —
Repurchase of common shares (11,042) — — (11,042) — — —
Repurchase of common shares to settle tax obligations (2,623) — — (2,623) — — —
Forfeiture of employee common shares 1 — — — 1 — —
Dividends/distributions (29,161) — — — (28,765) — (396)
Net income 18,420 — — — 18,154 — 266
Other comprehensive loss (16,996) — — — — (16,996) —
Balance March 31, 2020 $ 1,702,670 $ 94,016 $ 26 $ 2,982,363 $ (1,374,286) $ (18,924) $ 19,475

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited and in thousands)


Three Months Ended March 31, 2021			LXP Industrial Trust Shareholders
	Total		Number of Preferred Shares	Preferred Shares		Number of Common Shares	Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Income/(Loss)		Noncontrolling Interests
Balance December 31, 2020	$	1,991,137	1,935,400	$	94,016	277,152,450	$	28	$	3,196,315	$	(1,301,726)	$	(17,963)	$	20,467
Issuance of partnership interest in real estate	2,712		—	—		—	—		—		—		—		2,712
Redemption of noncontrolling OP units for common shares	—		—	—		60,116	—		311		—		—		(311)
Issuance of common shares and deferred compensation amortization, net	1,517		—	—		911,202	—		1,517		—		—		—

Repurchase of common shares to settle tax obligations	(5,120)		—	—		(499,638)	—		(5,120)		—		—		—
Forfeiture of employee common shares	2		—	—		(9,274)	—		—		2		—		—
Dividends/distributions ($0.1075 per common share)	(31,743)		—	—		—	—		—		(31,369)		—		(374)
Net income	41,475		—	—		—	—		—		41,042		—		433
Other comprehensive income	5,346		—	—		—	—		—		—		5,346		—
Balance March 31, 2021	$	2,005,326	1,935,400	$	94,016	277,614,856	$	28	$	3,193,023	$	(1,292,051)	$	(12,617)	$	22,927

Table of Content

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited and in thousands)


	Three Months Ended March 31,
	2022		2021
Net cash provided by operating activities:	$	42,090	$	57,400
Cash flows from investing activities:
Acquisition of real estate, including intangible assets	(72,148)		(50,778)
Investment in real estate under construction	(75,368)		(29,988)
Capital expenditures	(5,991)		(1,303)
Net proceeds from sale of properties	255		56,509


Principal payments received on loans receivable	7		—


Investments in non-consolidated entities	(121)		(553)
Distributions from non-consolidated entities in excess of accumulated earnings	1,537		2,743

Deferred leasing costs	(536)		(2,232)

Change in real estate deposits, net	(167)		686
Net cash used in investing activities	(152,532)		(24,916)
Cash flows from financing activities:
Dividends to common and preferred shareholders	(36,827)		(33,453)


Principal amortization payments	(2,779)		(4,760)














Cash contributions from noncontrolling interests	4,109		2,223
Cash distributions to noncontrolling interests	(172)		(374)

Purchase of noncontrolling interest	(27,958)		—




Repurchases to settle tax obligations	(6,285)		(5,120)
Issuance of common shares, net	38,495		(246)


Net cash used in financing activities	(31,417)		(41,730)
Change in cash, cash equivalents and restricted cash	(141,859)		(9,246)
Cash, cash equivalents and restricted cash, at beginning of period	191,027		179,421
Cash, cash equivalents and restricted cash, at end of period	$	49,168	$	170,175

Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents at beginning of period	$	190,926	$	178,795
Restricted cash at beginning of period	101		626
Cash, cash equivalents and restricted cash at beginning of period	$	191,027	$	179,421

Cash and cash equivalents at end of period	$	49,063	$	142,074
Restricted cash at end of period	105		28,101
Cash, cash equivalents and restricted cash at end of period	$	49,168	$	170,175

Three Months Ended March 31,
2021 2020
Net cash provided by operating activities: $ 57,400 $ 45,665
Cash flows from investing activities:
Acquisition of real estate, including intangible assets (50,778) (195,560)
Investment in real estate under construction (29,988) (4,820)
Capital expenditures (1,303) (2,383)
Net proceeds from sale of properties 56,509 22,380
Investments in non-consolidated entities (553) (1,080)
Distributions from non-consolidated entities in excess of accumulated earnings 2,743 1,293
Deferred leasing costs (2,232) (3,774)
Change in real estate deposits, net 686 727
Net cash used in investing activities (24,916) (183,217)
Cash flows from financing activities:
Dividends to common and preferred shareholders (33,453) (29,477)
Principal amortization payments (4,760) (5,848)
Revolving credit facility borrowings 0 130,000
Cash contributions from noncontrolling interests 2,223 421
Cash distributions to noncontrolling interests (374) (396)
Repurchases to settle tax obligations (5,120) (2,623)
Issuance of common shares, net (246) 17,265
Repurchase of common shares 0 (11,042)
Net cash provided by (used in) financing activities (41,730) 98,300
Change in cash, cash equivalents and restricted cash (9,246) (39,252)
Cash, cash equivalents and restricted cash, at beginning of period 179,421 129,310
Cash, cash equivalents and restricted cash, at end of period $ 170,175 $ 90,058
Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents at beginning of period $ 178,795 $ 122,666
Restricted cash at beginning of period 626 6,644
Cash, cash equivalents and restricted cash at beginning of period $ 179,421 $ 129,310
Cash and cash equivalents at end of period $ 142,074 $ 83,525
Restricted cash at end of period 28,101 6,533
Cash, cash equivalents and restricted cash at end of period $ 170,175 $ 90,058

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, ~~2021~~2022 and ~~2020~~2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(1)The Company and Financial Statement Presentation

~~Lexington Realty~~LXP Industrial Trust (together with its consolidated subsidiaries, except when the context only applies to the parent entity, the ~~“Company”~~“Company”) is a Maryland real estate investment trust ~~(“REIT”~~(“REIT”) that owns a portfolio of equity investments focused on single-tenant industrial properties.

As of March 31, ~~2021,~~2022, the Company had ownership interests in approximately ~~130~~123 consolidated real estate properties, located in 2823 states. The properties in which the Company has an interest are primarily net leased to tenants in various industries.

The Company believes it has qualified as a REIT under the Internal Revenue Code of 1986, as amended (the ~~“Code”~~“Code”). Accordingly, the Company will not be subject to federal income tax, provided that distributions to its shareholders equal at least the amount of its REIT taxable income as defined under the Code. The Company is permitted to participate in certain activities from which it was previously precluded in order to maintain its qualification as a REIT, so long as these activities are conducted in entities which elect to be treated as taxable REIT subsidiaries ~~(“TRS”~~(“TRS”) under the Code. As such, the TRS are subject to federal income taxes on the income from these activities.

The Company conducts its operations indirectly through (1) property owner subsidiaries, which are single purpose entities, (2) a wholly-owned TRS, Lexington Realty Advisors, Inc. ~~(“LRA”~~(“LRA”), and (3) joint ventures. Property owner subsidiaries are landlords under leases for properties in which the Company has an interest and/or borrowers under loan agreements secured by properties in which the Company has an interest and lender subsidiaries are lenders under loan agreements where the Company made an investment in a loan asset, but in all cases are separate and distinct legal entities. Each property owner subsidiary is a separate legal entity that maintains separate books and records. The assets and credit of each property owner subsidiary with a property subject to a mortgage loan are not available to creditors to satisfy the debt and other obligations of any other person, including any other property owner subsidiary or any other affiliate. Consolidated entities that are not property owner subsidiaries do not directly own any of the assets of a property owner subsidiary (or the general partner, member or managing member of such property owner subsidiary), but merely hold partnership, membership or beneficial interests therein, which interests are subordinate to the claims of such property owner subsidiary's (or its general partner's, member's or managing member's) creditors.

The financial statements contained in this Quarterly Report on Form 10-Q (this ~~“Quarterly Report”~~“Quarterly Report”) for the three months ended March 31, 2022 and 2021 have been prepared by the Company in accordance with U.S. generally accepted accounting principles ~~(“GAAP”~~(“GAAP”) for interim financial information and the applicable rules and regulations of the Securities and Exchange Commission ~~(“SEC”~~(“SEC”). Accordingly, they do not include all information and footnotes required by GAAP for complete financial statements. However, in the opinion of management, the interim financial statements include all adjustments, consisting of normal recurring adjustments, necessary for a fair ~~statement~~presentation of the results of the periods presented. Interim results are not necessarily indicative of the results that may be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2020~~2021 filed with the SEC on February ~~18, 2021 (“~~24, 2022 (“Annual ~~Report”~~Report”).

Basis of Presentation and Consolidation. The Company's unaudited condensed consolidated financial statements are prepared on the accrual basis of accounting in accordance with GAAP. The financial statements reflect the accounts of the Company and its consolidated subsidiaries. The Company consolidates the wholly-owned subsidiaries, partnerships and joint ventures which it controls (i) through voting rights or similar rights or (ii) by means other than voting rights if the Company is the primary beneficiary of a variable interest entity ("VIE"). Entities which the Company does not control and entities which are VIEs in which the Company is not a primary beneficiary are accounted for under appropriate GAAP.

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, ~~2021~~2022 and ~~2020~~2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

InAs of March ~~2021,~~31, 2022, the Company ~~acquired an~~had interests in 7 joint ventures with developers, consisting of 5 ongoing development projects and 2 land joint ventures with ownership interests ranging from 80% ~~interest in a~~to 95.5%. Each joint venture owns land parcels with ~~a developer, which acquired a land parcel in~~ the ~~Central Florida market to develop an~~intention of developing industrial ~~property.~~properties. The Company determined that the joint ~~venture is a~~ventures are variable interest ~~entity~~entities in accordance with the applicable accounting guidance. ~~As a result, the~~The Company ~~evaluated whether~~concluded that it ~~was~~is the primary beneficiary in ~~the arrangement, and based upon the Company's control over activities that most significantly impact the performance~~each of the joint ~~venture,~~ventures and as such, the joint ~~venture is~~ventures' operations are consolidated in the ~~Company's~~Company’s financial statements.

In addition, the Company is the primary beneficiary of certain other VIEs as it has a controlling financial interest in these entities. Lepercq Corporate Income Fund L.P. ("LCIF") ~~and ATL Fairburn L.P. ("Fairburn JV"), are~~is a consolidated VIE and the Company, ~~has~~as of March 31, 2022, had an approximate ~~97% and 87% interest, respectively, are VIEs.~~99% ownership interest.

The assets of each VIE are only available to satisfy such VIE's respective liabilities. ~~As of March 31, 2021 and December 31, 2020, the VIEs' mortgages and notes payable were non-recourse to the Company.~~ Below is a summary of selected financial data of the consolidated VIEs for which the Company is the primary beneficiary included in the unaudited condensed consolidated balance sheets as of March 31, ~~2021~~2022 and December 31, ~~2020:~~2021:

March 31, 2021 December 31, 2020
Real estate, net $ 571,873 $ 569,461
Total assets $ 671,067 $ 679,786
Mortgages and notes payable, net $ 25,606 $ 25,600
Total liabilities $ 39,939 $ 40,974


	March 31, 2022		December 31, 2021
Real estate, net	$	871,972	$	810,087
Total assets	$	932,996	$	952,611

Total liabilities	$	44,737	$	47,011

In addition, the Company acquires, from time to time, properties using a reverse like-kind exchange structure pursuant to Section 1031 of the Internal Revenue Code (a "reverse 1031 exchange") and, as such, the properties are in the possession of an Exchange Accommodation Titleholder ("EAT") until the reverse 1031 exchange is completed. The EAT is classified as a VIE as it is a ~~“thinly capitalized”~~“thinly capitalized” entity. The Company consolidates the EAT because it is the primary beneficiary as it has the ability to control the activities that most significantly impact the EAT's economic performance and can collapse the 1031 exchange structure at any time. The assets of the EAT primarily consist of leased property (net real estate and intangibles).

Revenue Recognition. The Company recognizes lease revenue on a straight-line basis over the term of the lease unless another systematic and rational basis is more representative of the time pattern in which the use benefit is derived from the leased property. Revenue is recognized on a contractual basis for leases with escalations tied to a consumer price index with no floor. The Company evaluates the collectability of its rental payments and recognizes revenue on a cash basis when the Company believes it is no longer probable that it will receive substantially all of the remaining lease payments. Renewal options in leases ~~with rental terms that are lower than those in the primary term~~ are excluded from the calculation of straight-line rent if the renewals are not reasonably ~~assured.~~certain. If the Company funds tenant improvements and the improvements are deemed to be owned by the Company, revenue recognition will commence when the improvements are substantially completed and possession or control of the space is turned over to the tenant. If the Company determines that the tenant allowances are lease incentives, the Company commences revenue recognition when possession or control of the space is turned over to the tenant for tenant work to begin. The lease incentive is recorded as a deferred expense and amortized as a reduction of revenue on a straight-line basis over the respective lease term. The Company recognizes lease termination fees as rental revenue in the period received and writes off unamortized lease-related intangible and other lease-related account balances, provided there are no further Company obligations under the lease. Otherwise, such fees and balances are recognized on a straight-line basis over the remaining obligation period with the termination payments being recorded as a component of rent receivable-deferred on the unaudited condensed consolidated balance sheets.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~March 31, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

Use of Estimates. Management has made a number of significant estimates and assumptions relating to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses to prepare these unaudited condensed consolidated financial statements in conformity with GAAP. These estimates and assumptions are based on management's best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. Management adjusts such estimates when facts and circumstances dictate. The most significant estimates made include the recoverability of current and deferred accounts receivable and, allocation of property purchase price to tangible and intangible assets acquired and liabilities assumed, the determination of VIEs

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

and which entities should be consolidated, the determination of impairment of long-lived assets and equity method investments, valuation of derivative financial instruments, valuation of awards granted under compensation plans, the determination of the incremental borrowing rate for leases where the Company is the lessee and the useful lives of long-lived assets. Actual results could differ materially from those estimates.

~~Cost Capitalization.~~ The Company capitalizes interest and direct and indirect project costs associated with the initial construction of a property up to the time the property is substantially complete and ready for its intended use within Investments in real estate under construction in the condensed consolidated balance sheets. In addition, the Company capitalizes operating costs, including real estate taxes, insurance and utilities, that have been allocated to vacant space based on the square footage of the portion of the building not held available for immediate occupancy during the extended lease-up periods after the construction of the building shell has been completed if costs are being incurred to ready the vacant space for its intended use. If costs and activities incurred to ready the vacant space cease, then cost capitalization is also discontinued until such activities are resumed. Once construction has been completed on a vacant space, project costs are no longer capitalized.

Restricted Cash. Restricted cash is comprised primarily of cash balances held by ~~a qualified intermediary and operating cash reserves held at one property.~~lenders.

Fair Value Measurements. The Company follows the guidance in the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("Topic 820"), to determine the fair value of financial and non-financial instruments. Topic 820 defines fair value, establishes a framework for measuring fair value in GAAP and expands disclosures about fair value measurements. Topic 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three levels: Level 1 - quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities; Level 2 - observable prices that are based on inputs not quoted in active markets, but corroborated by market data; and Level 3 - unobservable inputs, which are used when little or no market data is available. The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible, as well as considering counterparty credit risk. The Company has formally elected to apply the portfolio exception within Topic 820 with respect to measuring counterparty risk for all of its derivative transactions subject to master netting arrangements.

The Company estimates the fair value of its real estate assets, including non-consolidated real estate assets, by using income and market valuation techniques. The Company may estimate fair values using market information such as recent sale contracts (Level 2 inputs) or recent sale offers or discounted cash flow models, which primarily rely on Level 3 inputs. The cash flow models include estimated cash inflows and outflows over a specified holding period. These cash flows may include contractual rental revenues, projected future rental revenues and expenses and forecasted tenant improvements and lease commissions based upon market conditions determined through discussion with local real estate professionals, experience the Company has with its other owned properties in such markets and expectations for growth. Capitalization rates and discount rates utilized in these models are estimated by management based upon rates that management believes to be within a reasonable range of current market rates for the respective properties based upon an analysis of factors such as property and tenant quality, geographical location and local supply and demand observations.

~~Table~~ To the extent the Company under-estimates forecasted cash out flows (tenant improvements, lease commissions and operating costs) or over-estimates forecasted cash inflows (rental revenue rates), the estimated fair value of ~~Contents~~its real estate assets could be overstated.

Cost Capitalization.

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~March 31, 2021~~The Company capitalizes interest and ~~2020~~

~~(Unaudited~~direct and ~~dollars~~indirect project costs associated with the initial construction of a property up to the time the property is substantially complete and ready for its intended use within investments in ~~thousands, except share/unit~~real estate under construction in the unaudited condensed consolidated balance sheets. If costs and ~~per share/unit data)~~

activities incurred to ready the vacant space cease, then cost capitalization is also discontinued until such activities are resumed. Once construction has been completed on a vacant space, project costs are no longer capitalized.

Recently Issued Accounting Guidance. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts that reference the London Interbank Offered Rate, or LIBOR, or another reference rate expected to be discontinued because of reference rate reform. The guidance in ASU 2020-04 is optional, applies for a limited period of time to ease the potential burden in accounting for (or recognizing the effect of) reference rate reform on financial reporting, in response to concerns about structural risks of interbank offered rates, and, particularly, the risk of cessation of LIBOR and may be elected over time as reference rate reform activities occur. As of March 31, 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(2)Earnings Per Share

A portion of the Company's non-vested share-based payment awards are considered participating securities and as such, the Company is required to use the two-class method for the computation of basic and diluted earnings per share. Under the two-class computation method, net losses are not allocated to participating securities unless the holder of the security has a contractual obligation to share in the losses. The non-vested share-based payment awards are not allocated losses as the awards do not have a contractual obligation to share in losses of the Company.

The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per share computations for the three months ended March 31, ~~2021~~2022 and ~~2020:~~2021:


		Three Months Ended March 31,				Three Months Ended March 31,
		2021		2020				2022		2021
BASIC	BASIC						BASIC

Net income attributable to common shareholders	Net income attributable to common shareholders	$	39,401	$	16,536		Net income attributable to common shareholders	$	8,989	$	39,401
Weighted-average number of common shares outstanding - basic	Weighted-average number of common shares outstanding - basic	275,416,327		253,038,161			Weighted-average number of common shares outstanding - basic	283,640,465		275,416,327

Net income attributable to common shareholders - per common share basic	Net income attributable to common shareholders - per common share basic	$	0.14	$	0.07		Net income attributable to common shareholders - per common share basic	$	0.03	$	0.14

DILUTED	DILUTED						DILUTED
Net income attributable to common shareholders - basic	Net income attributable to common shareholders - basic	$	39,401	$	16,536		Net income attributable to common shareholders - basic	$	8,989	$	39,401

Impact of assumed conversions	Impact of assumed conversions	240		107			Impact of assumed conversions	—		240
Net income attributable to common shareholders	Net income attributable to common shareholders	$	39,641	$	16,643		Net income attributable to common shareholders	$	8,989	$	39,641

Weighted-average common shares outstanding - basic	Weighted-average common shares outstanding - basic	275,416,327		253,038,161			Weighted-average common shares outstanding - basic	283,640,465		275,416,327
Effect of dilutive securities:	Effect of dilutive securities:						Effect of dilutive securities:
Shares issuable under forward sales agreements	Shares issuable under forward sales agreements	9,843		0			Shares issuable under forward sales agreements	4,348,422		9,843
Unvested share-based payment awards and options		775,108		1,160,994
Unvested share-based payment awards							Unvested share-based payment awards	1,078,891		775,108

OP Units		2,852,419		3,148,122

Operating partnership units							Operating partnership units	—		2,852,419

Weighted-average common shares outstanding - diluted	Weighted-average common shares outstanding - diluted	279,053,697		257,347,277			Weighted-average common shares outstanding - diluted	289,067,778		279,053,697

Net income attributable to common shareholders - per common share diluted	Net income attributable to common shareholders - per common share diluted	$	0.14	$	0.06		Net income attributable to common shareholders - per common share diluted	$	0.03	$	0.14

For per common share amounts, all incremental shares are considered anti-dilutive for periods that have a loss from continuing operations attributable to common shareholders. In addition, other common share equivalents may be anti-dilutive in certain periods.

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, ~~2021~~2022 and ~~2020~~2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(3)Investments in Real Estate

The Company completed the following warehouse/distribution acquisition ~~and development~~ transactions during the three months ended March 31, ~~2021:~~2022:

Property
Type Market Acquisition/Completion
Date Initial
Cost
Basis Primary
Lease
Expiration Land Building and Improvements Lease in-place Value Intangible Above (Below-) Market Lease Intangible, net
Industrial Indianapolis, IN January 2021 $ 14,310 12/2024 $ 1,208 $ 12,052 $ 1,035 $ 15
Industrial Indianapolis, IN January 2021 14,120 8/2025 1,162 11,825 1,133 0
Industrial Central Florida January 2021 22,358 5/2031 1,416 19,910 1,032 0
Industrial Columbus, OH
March 2021(1)
18,435 03/2024 2,800 15,635 0 0
$ 69,223 $ 6,586 $ 59,422 $ 3,200 $ 15


Market	Acquisition Date	Initial Cost Basis		Primary Lease Expiration at Acquisition Date	Land		Building and Improvements		Lease in-place Intangible
Cincinnati/Dayton, OH(1)	February 2022	$	23,382	N/A	$	2,010	$	21,372	$	—
Cincinnati/Dayton, OH	February 2022	48,660		04/2032	4,197		40,944		3,519



		$	72,042		$	6,207	$	62,316	$	3,519

(1) Subsequent to acquisition, property was fully leased for approximately nine years.

In 2022, the Company purchased the remaining 13% of equity owned by a noncontrolling interest in the Fairburn, Georgia warehouse/distribution facility for $27,958. As the Company previously consolidated its interest in the joint venture which owned the property, the acquisition of the noncontrolling ownership interest was recorded as an equity transaction with the difference between the purchase price and carrying balance of $25,058 recorded as a reduction in additional paid-in-capital.

As of March 31, ~~2021, development~~2022, the details of the warehouse/distribution real estate under construction are as follows (in $000's, except square feet):


Project (% owned)	# of Buildings	Market	Estimated Sq. Ft.	Estimated Project Cost		GAAP Investment Balance as of 3/31/2022		LXP Amount Funded as of 3/31/2022(3)		Estimated Building Completion Date	% Leased as of 3/31/2022
The Cubes at Etna East (95%)(1)	1	Columbus, OH	1,074,840	$	72,100	$	44,205	$	37,446	3Q 2022	—	%
Ocala (80%)(1)	1	Central Florida	1,085,280	81,200		51,808		36,151		3Q 2022	—	%
Cotton 303 (93%)(1)	2	Phoenix, AZ	880,678	84,200		40,176		35,306		4Q 2022	—	%
Mt. Comfort (80%)(1)	1	Indianapolis, IN	1,053,360	66,400		32,388		24,462		4Q 2022	—	%
Smith Farms (90%)(1)(2)	3	Greenville-Spartanburg, SC	2,194,820	162,500		62,681		46,968		4Q 2022 - 2Q 2023	36	%

				$	466,400	$	231,258	$	180,333

(1) Estimated project ~~was substantially completed.~~cost includes estimated tenant improvements and leasing costs and excludes potential developer partner promote.

In 2021, the Company acquired an 80% interest in a newly-formed and consolidated joint venture, RR Ocala 44, LLC, that invested in an 88.8-acre land parcel in the Central Florida market to construct a 1,085,280(2) Pre-leased 797,936 square foot ~~warehouse/distribution~~facility subject to a 12-year lease commencing upon substantial completion of the facility.

(3) Excludes noncontrolling interests' share.

As of March 31, ~~2021, the Company's investments in real estate under construction consisted of 2 development projects and 1 build-to-suit development project. As of March 31, 2021,~~2022, the Company's aggregate investment in the development arrangements was ~~$88,374,~~$231,258, which included capitalized interest of ~~$502~~$1,146 for the ~~three-month period~~three months ended March 31, ~~2021~~2022 and is presented as investments in real estate under construction in the accompanying unaudited condensed consolidated balance ~~sheets.~~sheet. For the three months ended March 31, ~~2020,~~2021, capitalized interest for ~~the~~ development arrangements was ~~$150.~~$502.

As of March 31, ~~2021,~~2022, the details of the ~~on-going real estate under construction~~land held for development are as follows (in $000's, except ~~square feet)~~acres):

Project (% owned) Market Property Type Estimated Sq. Ft. Estimated Project Cost GAAP Investment Balance as of
3/31/2021 Amount Funded as of
3/31/2021 Estimated Completion Date % Leased as of 3/31/2021 Approximate Lease Term (Years)
Fairburn (87%)(1)
Atlanta, GA Industrial 910,000 $ 53,812 $ 45,322 $ 40,376 2Q 2021 0 % TBD
KeHE Distributors, BTS (100%) Phoenix, AZ Industrial 468,182 72,000 31,165 26,301 3Q 2021 100 % 15
Ocala (80%)(1)
Central Florida Industrial 1,085,280 80,900 11,887 7,682 1Q 2022 0 % TBD
$ 206,712 $ 88,374 $ 74,359


Project (% owned)	Market	Approx. Developable Acres	GAAP Investment Balance as of 3/31/2022		LXP Amount Funded as of 3/31/2022 (1)
Consolidated:
Reems & Olive (95.5%)	Phoenix, AZ	420	$	101,047	$	96,544
Mt. Comfort Phase II (80%)	Indianapolis, IN	70	3,300		2,612
		490	$	104,347	$	99,156

(1) ~~Estimated project costs exclude developer partner promote.~~ Excludes noncontrolling interests' share.

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LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(4)Dispositions and Impairment

During the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, the Company disposed of its interests in various properties for an aggregate gross disposition price of ~~$58,092~~$289 and ~~$29,605,~~$58,092, respectively, and recognized aggregate gains on sales of properties of $255 and $21,919, ~~and $9,805,~~ respectively. Included in the 2020 dispositions is 1 office property located in Charleston, South Carolina which was conveyed to the lender in forgiveness of the mortgage loan encumbering the property. The balance of the non-recourse mortgage loan was in excess of the value of the property collateral, resulting in a debt satisfaction gain, net of $1,393.

~~As of March 31, 2021, the~~The Company had ~~1 property~~10 and 8 properties classified as held for sale ~~because the property met the criteria included under the held for sale accounting guidance~~at March 31, 2022 and ~~a sale to a third party within the next 12 months was deemed probable. As of~~ December 31, ~~2020, the Company had 2 properties that met the held for sale criteria.~~

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~March 31,~~ 2021, ~~and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

respectively. Assets and liabilities of the held for sale properties as of March 31, ~~2021~~2022 and December 31, ~~2020~~2021 consisted of the following:


		March 31, 2021		December 31, 2020			March 31, 2022		December 31, 2021
Assets:	Assets:					Assets:
Real estate, at cost	Real estate, at cost	$	27,459	$	32,629	Real estate, at cost	$	204,029	$	170,117
Real estate, intangible assets	Real estate, intangible assets	7,933		7,941		Real estate, intangible assets	15,161		9,454
Accumulated depreciation and amortization	Accumulated depreciation and amortization	(17,023)		(24,312)		Accumulated depreciation and amortization	(116,242)		(99,659)
Rent receivable - deferred		0		79
Deferred expenses, net						Deferred expenses, net	1,822		1,759

Other	Other	14		193		Other	1,883		915
		$	18,383	$	16,530		$	106,653	$	82,586

Liabilities:	Liabilities:					Liabilities:
Accounts payable and liabilities						Accounts payable and liabilities	$	1,779	$	1,908
Deferred revenue						Deferred revenue	443		483
Prepaid rent						Prepaid rent	1,657		1,077
							$	3,879	$	3,468

Other		$	6	$	790
		$	6	$	790

The Company assesses on a regular basis whether there are any indicators that the carrying value of its real estate assets may be impaired. Potential indicators may include an increase in vacancy at a property, tenant financial instability, change in the estimated holding period of the asset, the potential sale or transfer of the property in the near future and changes in economic conditions. An asset is determined to be impaired if the asset's carrying value is in excess of its estimated fair value and the Company estimates that its cost will not be recovered. During the three months ended March 31, 2022 and 2021, there were no impairment charges recorded.

(5)Fair Value Measurements

The following tables present the Company's assets and liabilities measured at fair value on a recurring and non-recurring basis as of March 31, ~~2021~~2022 and December 31, ~~2020,~~2021, aggregated by the level in the fair value hierarchy within which those measurements fall:


											Balance		Fair Value Measurements Using
Description										Description	March 31, 2022		(Level 1)		(Level 2)		(Level 3)
Interest rate swap assets										Interest rate swap assets	$	6,008	$	—	$	6,008	$	—

		Balance		Fair Value Measurements Using							Balance		Fair Value Measurements Using
Description	Description	March 31, 2021		(Level 1)		(Level 2)		(Level 3)		Description	December 31, 2021		(Level 1)		(Level 2)		(Level 3)
Interest rate swap liabilities	Interest rate swap liabilities	$	(12,617)	$	0	$	(12,617)	$	0	Interest rate swap liabilities	$	(6,258)	$	—	$	(6,258)	$	—

Impaired real estate assets(1)										Impaired real estate assets(1)	$	12,735	$	—	$	—	$	12,735

Balance Fair Value Measurements Using
Description December 31, 2020 (Level 1) (Level 2) (Level 3)
Interest rate swap liabilities $ (17,963) $ 0 $ (17,963) $ 0
Impaired real estate assets (1) $ 21,141 $ 0 $ 2,480 $ 18,661

(1) Represents non-recurring fair value measurement. The Company measured a $12,735 fair value ~~is calculated as~~ of ~~the impairment date. $2,480 was~~real estate assets based on ~~an observable contract thus Level 2. The Company measured $18,661 of these fair values based on~~a discounted cash flow analysis using a ~~hold period of 10 years, a~~ discount rate ~~of 9.0%~~ranging from8.0% to 10.0% and a residual capitalization ~~rates~~rate ranging from ~~8.0%~~7.5% to ~~9.0%~~8.0%. As significant inputs to the models are unobservable, the Company determined that the value determined for these properties falls within Level 3 of the fair value reporting hierarchy.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~March 31, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

The majority of the inputs used to value the Company's interest rate swaps fell within Level 2 of the fair value hierarchy, such as observable market interest rate curves; however, the credit valuation associated with the interest rate

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

swaps utilized Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties. As of March 31, ~~2021~~2022 and December 31, ~~2020,~~2021, the Company determined that the credit valuation adjustment relative to the overall fair value of the interest rate swaps was not significant. As a result, the interest rate swaps were classified in Level 2 of the fair value hierarchy.

The table below sets forth the carrying amounts and estimated fair values of the Company's financial instruments, excluding held for sale assets, as of March 31, ~~2021~~2022 and December 31, ~~2020:~~2021:


	As of March 31, 2022				As of December 31, 2021
	Carrying Amount		Fair Value		Carrying Amount		Fair Value



Liabilities
Debt	$	1,494,849	$	1,416,302	$	1,497,064	$	1,491,868

As of March 31, 2021 As of December 31, 2020
Carrying
Amount Fair Value Carrying
Amount Fair Value
Liabilities
Debt $ 1,337,045 $ 1,345,226 $ 1,341,242 $ 1,368,151

The fair value of the Company's debt is primarily estimated utilizing Level 3 inputs by using a discounted cash flow analysis, based upon estimates of market interest rates, except for the Company's senior notes payable. The Company determines the fair value of its senior notes payable using market prices. The inputs used in determining the fair value of these notes are categorized as Level 1 due to the fact that the Company uses quoted market rates to value these instruments. However, the inputs used in determining the fair value could be categorized as Level 2 if trading volumes are low.

Fair values cannot be determined with precision, may not be substantiated by comparison to quoted prices in active markets and may not be realized upon sale. Additionally, there are inherent uncertainties in any fair value measurement technique, and changes in the underlying assumptions used, including discount rates, liquidity risks and estimates of future cash flows, could significantly affect the fair value measurement amounts.

Cash Equivalents, Restricted Cash, Accounts Receivable and Accounts Payable. The Company estimates that the fair value of cash equivalents, restricted cash, accounts receivable and accounts payable approximates carrying value due to the relatively short maturity of the instruments.

(6)Investments in Non-Consolidated Entities

Below is a schedule of the Company's investments in non-consolidated entities:


			Percentage Ownership at	Investment Balance as of						Percentage Ownership at	Investment Balance as of
Investment	Investment		March 31, 2021	March 31, 2021		December 31, 2020		Investment		March 31, 2022	March 31, 2022		December 31, 2021
NNN Office JV LP ("NNN JV")		(1)	20%	$	29,168	$	31,615
NNN MFG Cold JV L.P. ("MFG Cold JV")								NNN MFG Cold JV L.P. ("MFG Cold JV")	(1)	20%	$	30,601	$	30,752
NNN Office JV L.P. ("NNN JV")								NNN Office JV L.P. ("NNN JV")	(2)	20%	24,051		24,112
Etna Park 70 LLC	Etna Park 70 LLC	(2)	90%	12,791		12,514		Etna Park 70 LLC	(3)	90%	12,927		12,874
Etna Park East LLC	Etna Park East LLC	(3)	90%	7,716		7,484		Etna Park East LLC	(4)	90%	2,112		2,797
BSH Lessee L.P.	BSH Lessee L.P.	(4)	25%	4,510		4,851		BSH Lessee L.P.	(5)	25%	3,884		4,024
				$	54,185	$	56,464				$	73,575	$	74,559

(1) MFG Cold JV is a joint venture formed in 2021 and owns special purpose industrial properties formerly owned by the Company.

(2) NNN JV is a joint venture formed in 2018 and owns office properties formerly owned by the Company.

~~(2)~~(3) Joint venture formed in 2017 with a developer entity to acquire a parcel of land. The Company determined that it is not the primary beneficiary.

~~(3)~~(4) Joint venture formed in 2019 with a developer entity to acquire a parcel of land. The Company determined that it is not the primary beneficiary.

~~(4)~~(5) A joint venture investment, which owns a single-tenant, net-leased asset.

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~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, ~~2021~~2022 and ~~2020~~2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

During the three months ended March 31, ~~2020,~~2022, NNN JV sold ~~1 asset~~2 assets and the Company recognized a gain on the transaction of ~~$550~~$11,315 within equity in earnings (losses) of non-consolidated entities in its unaudited condensed consolidated statement of operations. In conjunction with ~~this~~these property ~~sale,~~sales, NNN JV received net proceeds of ~~$3,419~~$57,879 after the satisfaction of an aggregate of ~~$12,960~~$108,960 of its non-recourse mortgage indebtedness. ~~During~~NNN JV distributed $11,513 of net proceeds to the Company as a result of the property sales.

The following is a summary of the results of operations of NNN JV for the three months ended March 31, ~~2021, NNN JV did 0t sell any properties.~~2022 and 2021:


	Three months ended March 31,
	2022		2021
Total gross revenues	$	14,391	$	15,186
Depreciation expense	(7,958)		(9,685)
Property operating	(2,412)		(2,345)
General and administrative	(558)		(566)
Gain on sale	56,576		—
Interest expense	(2,532)		(2,981)
Income from continuing operations	57,507		(391)
Provision for income taxes	(250)		(26)
Net income	$	57,257	$	(417)

(7)Debt

The Company had the following mortgages and notes payable outstanding as of March 31, ~~2021~~2022 and December 31, ~~2020:~~2021:


		March 31, 2021		December 31, 2020			March 31, 2022		December 31, 2021
Mortgages and notes payable	Mortgages and notes payable	$	133,653	$	138,412	Mortgages and notes payable	$	81,650	$	84,429
Unamortized debt issuance costs	Unamortized debt issuance costs	(1,804)		(1,883)		Unamortized debt issuance costs	(1,265)		(1,337)
Mortgages and notes payable, net	Mortgages and notes payable, net	$	131,849	$	136,529	Mortgages and notes payable, net	$	80,385	$	83,092

Interest rates, including imputed rates on mortgages and notes payable, ranged from 3.5% to ~~6.3%~~4.3%, ~~respectively,~~ at March 31, ~~2021~~2022 and December 31, ~~2020,~~2021 and all mortgages and notes payables mature between ~~2021~~2023 and ~~2032~~2031 as of March 31, ~~2021.~~2022. The weighted-average interest rate was ~~4.5%~~approximately 4.0% at March 31, ~~2021~~2022 and December 31, ~~2020.~~2021.

The Company had the following ~~senior notes~~Senior Notes outstanding as of March 31, ~~2021~~2022 and December 31, ~~2020:~~2021:


Issue Date	Issue Date	March 31, 2021		December 31, 2020		Interest Rate		Maturity Date	Issue Price		Issue Date	March 31, 2022		December 31, 2021		Interest Rate		Maturity Date	Issue Price
August 2021											August 2021	$	400,000	$	400,000	2.375	%	October 2031	99.758	%
August 2020	August 2020	$	400,000	$	400,000	2.70	%	September 2030	99.233	%	August 2020	400,000		400,000		2.70	%	September 2030	99.233	%
May 2014	May 2014	198,932		198,932		4.40	%	June 2024	99.883	%	May 2014	198,932		198,932		4.40	%	June 2024	99.883	%
June 2013		188,756		188,756		4.25	%	June 2023	99.026	%
		787,688		787,688								998,932		998,932
Unamortized debt discount	Unamortized debt discount	(3,363)		(3,491)							Unamortized debt discount	(3,547)		(3,655)
Unamortized debt issuance cost	Unamortized debt issuance cost	(4,718)		(4,922)							Unamortized debt issuance cost	(7,113)		(7,346)
Senior notes payable, net	Senior notes payable, net	$	779,607	$	779,275						Senior notes payable, net	$	988,272	$	987,931

Each series of the senior notes is unsecured and requires payment of interest semi-annually in arrears. The Company may redeem the notes at its option at any time prior to maturity in whole or in part by paying the principal amount of the notes being redeemed plus a make-whole premium.

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LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

The Company has an unsecured credit agreement with KeyBank National Association, as agent. The maturity dates and interest rates as of March 31, ~~2021,~~2022, are as follows:


	Maturity Date	Current Interest Rate
$600,000 Revolving Credit Facility(1)	February 2023	LIBOR + 0.90%
$300,000 Term Loan(2)	January 2025	LIBOR + 1.00%

(1) Maturity date of the revolving credit facility can be extended to February 2024 at the Company's option. The interest rate ranges from LIBOR plus 0.775% to 1.45%. At March 31, ~~2021,~~2022, the Company had 0 borrowings outstanding and availability of $600,000, subject to covenant compliance.

(2) The LIBOR portion of the interest rate was swapped to obtain a current fixed rate of 2.732% per annum. The aggregate unamortized debt issuance costs for the term loan was ~~$1,931~~$1,428 and ~~$2,057~~$1,554 as of March 31, ~~2021~~2022 and December 31, ~~2020,~~2021, respectively.

The Company was compliant with all applicable financial covenants contained in its corporate-level debt agreements at March 31, ~~2021.~~

~~Table of Contents~~2022.

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~March 31, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

During 2007, the Company issued $200,000 original principal amount of Trust Preferred Securities. The Trust Preferred Securities, which are classified as debt, are due in 2037, are open for redemption at the Company's option and bear interest at a variable rate of three-month LIBOR plus 170 basis points through maturity. The interest rate at March 31, ~~2021~~2022 was ~~1.905%~~1.999%. As of March 31, ~~2021~~2022 and December 31, ~~2020,~~2021, there was $129,120 original principal amount of Trust Preferred Securities outstanding and ~~$1,600~~$1,500 and ~~$1,625,~~$1,525, respectively, of unamortized debt issuance costs.

Capitalized interest recorded during the three months ended March 31, 2022 and 2021 was $1,166 and ~~2020 was~~ $691, ~~and $292,~~ respectively.

(8) Derivatives and Hedging Activities

Risk Management Objective of Using Derivatives. The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the type, amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company's derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company's known or expected cash receipts and its known or expected cash payments principally related to the Company's investments and borrowings.

Cash Flow Hedges of Interest Rate Risk. The Company's objectives in using interest rate derivatives are to add stability to interest expense, to manage its exposure to interest rate movements and therefore manage its cash outflows as it relates to the underlying debt instruments. To accomplish these objectives, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy relating to certain of its variable rate debt instruments. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.

The ~~effective portion of~~ changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income (loss) and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. The ~~ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. The~~ Company did not incur any ineffectiveness during the three months ended March 31, ~~2021~~2022 and ~~2020.~~2021.

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LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

During July 2019, the Company entered into 4 interest rate swap agreements with its counterparties. The swaps were designated as cash flow hedges of the risk of variability attributable to changes in the LIBOR swap rates on its $300,000 LIBOR-indexed variable-rate unsecured term loan. Accordingly, changes in fair value of the swaps are recorded in other comprehensive income (loss) and reclassified to earnings as interest becomes receivable or payable. The swaps expire coterminous with the extended maturity of the term loan in January 2025. During the next 12 months, ~~ending March 31, 2022,~~ the Company estimates that an additional ~~$4,817~~$155 will be reclassified as ~~an increase~~a decrease to interest expense if the swaps remain outstanding.


Interest Rate Derivative	Number of Instruments	Notional
Interest Rate Swaps	4	$300,000

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~March 31, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

The table below presents the fair value of the Company's derivative financial instruments as well as their classification on the unaudited condensed consolidated balance sheets:

As of March 31, 2021 As of December 31, 2020
Balance Sheet Location Fair Value Balance Sheet Location Fair Value
Derivatives designated as hedging instruments
Interest Rate Swaps Accounts Payable and Other Liabilities $ (12,617) Accounts Payable and Other Liabilities $ (17,963)

As of March 31, 2022

As of December 31, 2021

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Derivatives designated as hedging instruments

Interest Rate Swaps

Other Assets

6,008

Other Liabilities

(6,258)

The table below presents the effect of the Company's derivative financial instruments on the unaudited condensed consolidated statements of operations for the three months ended March 31, ~~2021~~2022 and ~~2020.~~2021.


Derivatives in Cash Flow	Derivatives in Cash Flow	Amount of Gain (Loss) Recognized in OCI on Derivatives March 31,				Amount of Loss Reclassified from Accumulated OCI into Income (1) March 31,				Derivatives in Cash Flow	Amount of Gain Recognized in OCI on Derivatives March 31,				Amount of Loss Reclassified from Accumulated OCI into Income (1) March 31,
Hedging Relationships	Hedging Relationships	2021		2020		2021		2020		Hedging Relationships	2022		2021		2022		2021
Interest Rate Swaps	Interest Rate Swaps	$	4,143	$	(17,039)	$	1,203	$	43	Interest Rate Swaps	$	11,078	$	4,143	$	1,188	$	1,203

(1) Amounts reclassified from accumulated other comprehensive income (loss) to interest expense within the unaudited condensed consolidated statement of operations.

Total interest expense presented in the unaudited condensed consolidated statements of operations, in which includes the effects of cash flow hedges, ~~are recorded~~ was ~~$11,486~~$10,682 and ~~$14,795~~$11,486 for the three months ended March 31, 2022 and 2021, ~~and 2020,~~ respectively.

The Company's agreements with swap derivatives counterparties contain provisions whereby if the Company defaults on the underlying indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default of the swap derivative obligation. As of March 31, ~~2021,~~2022, the Company had not posted any collateral related to the agreements.

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LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(9) Lease Accounting

Lessor

The ~~following is a summary of the Company's accounting for leases as of and during the three-month period ended March 31, 2021 and 2020:~~

~~Lessor~~

~~Lexington’s~~Company’s lease portfolio as a lessor primarily includes general purpose, single-tenant net-leased ~~industrial and office~~ real estate assets. Most of the ~~Company’s~~Company’s leases require tenants to pay fixed annual rental payments that escalate on an annual basis and variable payments for other operating expenses, such as real estate taxes, insurance, common area maintenance ("CAM"), and utilities, that are based on the actual expenses incurred.

Certain leases allow for the tenant to renew the lease term upon expiration or earlier. Periods covered by a renewal option are included within the lease term only when renewals are deemed to be reasonably certain. Certain leases allow for the tenant to terminate the lease before the expiration of lease term and certain leases provide the tenant with the right to purchase the leased property at fair market value or a stipulated price upon expiration of the lease term or before.

Accounting guidance under Topic 842 requires the Company to make certain assumptions and judgments in applying the guidance, including determining whether an arrangement includes a lease and determining the lease term when the contract has renewal, purchase or early termination provisions.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~March 31, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

The Company analyzes its accounts receivable, customer creditworthiness and current economic trends when evaluating the adequacy of the collectability of the lessee's total accounts receivable balance on a lease by lease basis. In addition, tenants in bankruptcy are analyzed and considerations are made in connection with the expected pre-petition and post-petition claims. If a lessee's accounts receivable balance is considered ~~uncollectable,~~uncollectible, the Company will write-off the receivable balances associated with the lease to rental revenue and cease to recognize lease income, including straight-line rent, unless cash is received. If the Company subsequently determines that it is probable it will collect substantially all of the lessee's remaining lease payments under the lease term; the Company will reinstate the straight-line balance adjusting for the amount related to the period when the lease was accounted for on a cash basis. ~~In February 2020,~~During the three months ended March 31, 2022 and 2021, the Company ~~wrote~~did not write off aany deferred rent receivable ~~balance of $615~~ as a reduction of rental ~~revenue, related to a tenant that dissolved and surrendered its leased premises in an industrial property located in the Columbus, Ohio market.~~revenue.

Certain tenants have been experiencing financial difficulties as a result of the ~~COVID-19 pandemic.~~current economic conditions. During the three ~~month period~~months ended March 31, 2020, the Company wrote off a deferred rent receivable balance of $1,243, as a reduction of rental revenue, related to a tenant with rent collectability concerns. During the three-month period ended March 31,2022 and 2021, the Company wrote off ~~or reserved~~ an aggregate of $84 and $183, respectively, accounts receivable relating to certain tenants suffering from the current economic conditions.

The Company ~~determined~~elected that the lease and non-lease components in its leases are a single lease component, which is, therefore, being recognized as rental revenue in its unaudited condensed consolidated statements of operations. The primary non-lease service is included within rental revenue is CAM services provided as part of the ~~Company’s~~Company’s real estate leases. Topic 842 requires that the Company capitalize, as initial direct costs, only those costs that are incurred due to the execution of a lease. As of March 31, ~~2020,~~2022 and 2021, the Company ~~incurred $50 of~~did not incur any costs that were not incremental to the execution of leases, which are included in property operating expenses on its unaudited condensed consolidated statements of operations. The Company incurred 0 leasing costs that were not incremental for the execution of leases as of March 31, 2021.leases.

The Company manages the risk associated with the residual value of its leased properties by including contract clauses that make tenants responsible for surrendering the space in good condition upon lease termination, holding a diversified portfolio, and other activities. The Company does not have residual value guarantees on specific properties.

The following table presents the ~~Company’s~~Company’s classification of rental revenue for its operating leases for the three months ended March 31, ~~2021~~2022 and ~~2020:~~2021:

Three Months Ended
Classification March 31, 2021 March 31, 2020
Fixed $ 71,942 $ 71,265
Variable(1)(2)
19,703 7,470
Total $ 91,645 $ 78,735


	Three Months Ended
Classification	March 31, 2022		March 31, 2021
Fixed	$	66,982	$	71,942
Variable(1)(2)	11,554		19,703
Total	$	78,536	$	91,645

Table of Contents

LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2022 and 2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(1) Primarily comprised of tenant reimbursements.

(2) Variable income contains termination income of $10,941 ~~and $141~~ for the three months ended March 31, ~~2021 and 2020, respectively.~~2021. No termination fee revenue was recognized during the three months ended March 31, 2022. The 2021 termination fee income primarily related to a tenant that terminated its lease at ~~our~~the Company's Durham, New Hampshire industrial property.

~~Table of Contents~~

~~LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~March 31, 2021 and 2020~~

~~(Unaudited and dollars in thousands, except share/unit and per share/unit data)~~

Future fixed rental receipts for leases, assuming no new or re-negotiated leases as of March 31, ~~2021~~2022 were as follows:

2021 - remainder $ 201,837
2022 261,276
2023 262,314
2024 227,483
2025 200,079
Thereafter 1,115,668
Total $ 2,268,657


Three months ending March 31, 2022	Total
2022 - remainder	$	194,736
2023	263,513
2024	233,837
2025	212,628
2026	194,096
2027	158,937
Thereafter	581,264
Total	$	1,839,011

~~Lessee~~The above minimum lease payments do not include reimbursements to be received from tenants for certain operating expenses and real estate taxes and do not include early termination payments provided for in certain leases, unless such payments are reasonably certain to be received.

Lessee

The Company, as lessee, has ground leases, corporate leases for office space, and office equipment leases. All leases were classified as operating leases as of March 31, ~~2021.~~2022. The leases have remaining lease terms of up to ~~42 years, some of which include options to extend the leases in 5 to 10-year increments for up to 52~~39 years. Renewal periods are included in the lease term only when renewal is deemed to be reasonably certain. The lease term also includes periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise the termination option. The Company measures its lease payments by including fixed rental payments and variable rental payments that tie to an index or a rate, such as CPI. ~~Minimum lease payments for leases that commenced before the date of adoption of ASC 842 were determined based on previous leases guidance under ASC 840.~~ The Company recognizes lease expense for its operating leases on a straight-line basis over the lease term and variable lease expense not included in the lease payment measurement as incurred.

The accounting guidance under Topic 842 requires the Company to make certain assumptions and judgments in applying the guidance, including determining whether an arrangement includes a lease, determining the term of a lease when the contract has renewal or termination provisions and determining the discount rate.

The Company determines whether an arrangement is or includes a lease at contract inception by evaluating whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. If the Company has the right to obtain substantially all of the economic benefits from and can direct the use of, the identified asset for a period of time, the Company accounts for the contract as a lease.

As the Company does not know the rate implicit in the respective leases, the Company used its incremental borrowing rate based on the information available at the transition date for such existing leases. The Company uses the information available at the lease commencement date to determine the discount rate for any new leases. The Company used a portfolio approach to determine its incremental borrowing rate. Lease contracts were grouped based on similar lease terms and economic environments in a manner in which the Company reasonably expects that the outcome from applying a portfolio approach does not differ materially from an individual lease approach. The Company estimated a collateralized discount rate for each portfolio of leases.

~~Supplemental information related to operating leases is as follows:~~

Three Months Ended
March 31, 2021 March 31, 2020
Weighted-average remaining lease term
Operating leases (years) 11.5 12.1
Weighted-average discount rate
Operating leases 4.1 % 4.1 %

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, ~~2021~~2022 and ~~2020~~2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

Supplemental information related to operating leases is as follows:


	Three Months Ended
	March 31, 2022		March 31, 2021
Weighted-average remaining lease term
Operating leases (years)	9.5		11.5
Weighted-average discount rate
Operating leases	4.0	%	4.1	%

The components of lease expense for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 were as follows:

Income Statement Classification Fixed Variable Total
2021:
Property operating $ 912 $ 0 $ 912
General and administrative 336 33 369
Total $ 1,248 $ 33 $ 1,281
2020:
Property operating $ 995 $ 0 $ 995
General and administrative 341 26 367
Total $ 1,336 $ 26 $ 1,362


Income Statement Classification	Fixed		Variable		Total
2022:
Property operating	$	886	$	—	$	886
General and administrative	377		35		412
Total	$	1,263	$	35	$	1,298

2021:
Property operating	$	912	$	—	$	912
General and administrative	336		33		369
Total	$	1,248	$	33	$	1,281

The Company recognized sublease income of ~~$856~~$830 and ~~$941~~$856 for the three months ended March 31, 2022 and 2021, ~~and 2020,~~ respectively.

The following table shows the Company's maturity analysis of its operating lease liabilities as of March 31, ~~2021:~~2022:

Operating Leases
2021 - remainder $ 3,511
2022 4,854
2023 4,999
2024 5,021
2025 5,021
2026 3,985
Thereafter 13,487
Total lease payments $ 40,878
Less: Imputed interest (9,370)
Present value of operating lease liabilities $ 31,508


	Operating Leases
2022 - remainder	$	3,706
2023	5,290
2024	5,199
2025	5,204
2026	4,174
2027	3,673
Thereafter	7,501
Total lease payments	$	34,747
Less: Imputed interest	(6,711)
Present value of operating lease liabilities	$	28,036

(10)Concentration of Risk

The Company seeks to reduce its operating and leasing risks through the geographic diversification of its properties, tenant industry diversification, avoidance of dependency on a single asset and the creditworthiness of its tenants. For the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, no single tenant represented greater than 10% of rental revenues.

Cash and cash equivalent balances at certain institutions may exceed insurable amounts. The Company believes it mitigates this risk by investing in or through major financial institutions.

Table of Contents

~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, ~~2021~~2022 and ~~2020~~2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

(11)Equity

Shareholders' Equity:

During the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, the Company granted common shares to certain employees as follows:


		Three Months Ended March 31,					Three Months Ended March 31,
		2021		2020			2022		2021
Performance Shares(1)
Performance Shares:(1)						Performance Shares:(1)
Shares granted:	Shares granted:					Shares granted:
Index - 1Q	Index - 1Q	297,636		232,993		Index - 1Q	282,720		297,636
Peer - 1Q	Peer - 1Q	297,632		232,987		Peer - 1Q	282,715		297,632
Grant date fair value per share:(2)
Grant date fair value per share:(2)						Grant date fair value per share:(2)
Index - 1Q	Index - 1Q	$	7.13	$	6.59	Index - 1Q	$	9.40	$	7.13
Peer - 1Q	Peer - 1Q	$	6.23	$	5.97	Peer - 1Q	$	8.78	$	6.23

Non-Vested Common Shares:(3)
Non-Vested Common Shares:(3)						Non-Vested Common Shares:(3)
Shares issued	Shares issued	304,060		243,270		Shares issued	295,230		304,060
Grant date fair value	Grant date fair value	$	3,080	$	2,581	Grant date fair value	$	4,304	$	3,080

(1) The shares vest based on the Company's total shareholder return growth after a ~~three-year~~three-year measurement period relative to an index and a group of peer companies. Dividends are not paid on these grants until earned. Once the performance criteria are met and the actual number of shares earned is determined, such shares vest immediately. During the three months ended March 31, ~~2021,~~2022, all of the ~~662,044~~552,121 performance shares issued in ~~2018~~2019 vested.

(2) The fair value of ~~grants~~awards granted was determined at the grant date using a Monte Carlo simulation model.

(3) The shares vest ratably over a ~~three-year~~three-year service period.

At-The-Market Offering Program. The Company maintains an At-The-Market offering program ("ATM program") under which the Company can issue common shares, including through forward sales contracts. ~~The following table summarizes common share issuances under the ATM program for~~

During the three months ended March 31, ~~2020:~~2022, the Company issued 3,649,023 common shares previously sold on a forward basis in the first quarter of 2021 on the maturity date of the contracts and received $38,492 of net proceeds.

Three Months Ended March 31, 2020
Shares Sold Net Proceeds
2020 ATM Issuances 1,559,714 $17,266

The Company entered into forward sales contracts for the sale of 3,649,023 common shares during the three months ended March 31, 2021 that have not yet been settled. Subject to the Company's right to elect cash or net share settlement, the Company expects to settle the forward sales contracts by the maturity dates in February 2022. The Company did not enter into forward sales contracts as of March 31, 2020. As of March 31, 2021, an aggregate of 8,639,740 common shares were sold in forward sales contracts that have not been settled and had an aggregate settlement price of $94,493, which is subject to adjustment in accordance with the forward sales contracts.

~~In March~~During 2021, the Company amended the terms of its ATM offering program, under which the Company may, from time to time, sell up to $350,000 of common shares over the term of the program. As of March 31, ~~2021,~~2022, common shares with an aggregate value of ~~$309,048~~$294,985 remain available for issuance under the ATM program.

~~Nonemployee~~ Underwritten equity offerings. During 2021, the Company entered into forward sales contracts for the sale of 16,000,000 common shares at a public offering price of $12.11 per common share in an underwritten equity offering that have not yet settled. The forward sales contracts mature in May 2022, subject to the Company's rights to elect cash or net share settlement. As of March 31, 2022, the forward sales contracts had an aggregate settlement price of $185,309, which is subject to adjustment in accordance with the forward sales contracts.

Stock Based Compensation. During the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, the Company issued ~~11,850~~13,304 and ~~11,675,~~11,850, respectively, of fully vested common shares to non-management members of the Company's Board of Trustees ~~each~~ with a fair value of ~~$125.~~$232 and $125, respectively.

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~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, ~~2021~~2022 and ~~2020~~2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

Share Repurchase Program. In July 2015, the Company's Board of Trustees authorized the repurchase of up to 10,000,000 common shares and increased this authorization by 10,000,000 in 2018. This share repurchase program has no expiration date. ~~During~~There were no common shares repurchased during the three months ended March 31, ~~2020, the Company repurchased~~2022 and ~~retired 1,329,940 common shares at an average price of $8.28 per common share under the share repurchase program. There were 0 common shares repurchased during the three-month period ended March 31,~~ 2021. As of March 31, ~~2021,~~2022, 8,976,315 common shares remain available for repurchase under this authorization. The Company records a liability for repurchases that have not yet been settled as of the period end.

Series C Preferred Stock. The Company had 1,935,400 shares of Series C Cumulative Convertible Preferred Stock (“(“Series C ~~Preferred”~~Preferred”) outstanding at March 31, ~~2021.~~2022. The shares have a dividend of $3.25 per share per annum, have a liquidation preference of $96,770, and the Company, if certain common share prices are achieved, can force conversion into common shares of the Company. As of March 31, ~~2021,~~2022, each share was convertible into 2.4339 common shares. This conversion ratio may increase over time if the Company's common share dividend exceeds certain quarterly thresholds.

If certain fundamental changes occur, holders may require the Company, in certain circumstances, to repurchase all or part of their shares of Series C Preferred. In addition, upon the occurrence of certain fundamental changes, the Company will, under certain circumstances, increase the conversion rate by a number of additional common shares or, in lieu thereof, may in certain circumstances elect to adjust the conversion rate upon the shares of Series C Preferred becoming convertible into shares of the public acquiring or surviving company.

The Company may, at the Company's option, cause shares of Series C Preferred to be automatically converted into that number of common shares that are issuable at the then prevailing conversion rate. The Company may exercise its conversion right only if, at certain times, the closing price of the Company's common shares equals or exceeds 125% of the then prevailing conversion price of the Series C Preferred.

Holders of shares of Series C Preferred generally have no voting rights, but will have limited voting rights if the Company fails to pay dividends for six or more quarters and under certain other circumstances. Upon conversion, the Company may choose to deliver the conversion value to investors in cash, common shares, or a combination of cash and common shares.

A summary of the changes in accumulated other comprehensive income (loss) related to the Company's cash flow hedges is as follows:


		Three Months Ended March 31,					Three Months Ended March 31,
		2021		2020			2022		2021
Balance at beginning of period	Balance at beginning of period	$	(17,963)	$	(1,928)	Balance at beginning of period	$	(6,258)	$	(17,963)
Other comprehensive gain (loss) before reclassifications		4,143		(17,039)
Other comprehensive income before reclassifications						Other comprehensive income before reclassifications	11,078		4,143
Amounts of loss reclassified from accumulated other comprehensive income to interest expense	Amounts of loss reclassified from accumulated other comprehensive income to interest expense	1,203		43		Amounts of loss reclassified from accumulated other comprehensive income to interest expense	1,188		1,203
Balance at end of period	Balance at end of period	$	(12,617)	$	(18,924)	Balance at end of period	$	6,008	$	(12,617)

Noncontrolling Interests. In conjunction with several of the Company's acquisitions in prior years, sellers were issued LCIF (“OP units”) as a form of consideration. All OP units, other than OP units owned by the Company, are redeemable for common shares at certain times, at the option of the holders, and are generally not otherwise mandatorily redeemable by the Company. The OP units are classified as a component of permanent equity as the Company has determined that the OP units are not redeemable securities as defined by GAAP. Each OP unit is currently redeemable at the holder's option for approximately 1.13 common shares, subject to future adjustments.

As of March 31, ~~2021,~~2022, there were approximately ~~2,485,000~~769,000 OP units outstanding other than OP units owned by the Company. All OP units receive distributions in accordance with the LCIF partnership agreement. To the extent that the Company's dividend per common share is less than the stated distribution per OP unit per the LCIF partnership agreement, the distributions per OP unit are reduced by the percentage reduction in the Company's dividend per common share. No OP units have a liquidation preference.

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~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, ~~2021~~2022 and ~~2020~~2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

The following discloses the effects of changes in the Company's ownership interests in its noncontrolling interests:


		Net Income Attributable to Shareholders and Transfers from Noncontrolling Interests					Net Income Attributable to Shareholders and Transfers from Noncontrolling Interests
		Three Months Ended March 31,					Three Months Ended March 31,
		2021		2020			2022		2021
Net income attributable to Lexington Realty Trust shareholders		$	41,042	$	18,154
Net income attributable to LXP Industrial Trust shareholders						Net income attributable to LXP Industrial Trust shareholders	$	10,622	$	41,042
Transfers from noncontrolling interests:	Transfers from noncontrolling interests:					Transfers from noncontrolling interests:

Increase in additional paid-in-capital for redemption of noncontrolling OP units	Increase in additional paid-in-capital for redemption of noncontrolling OP units	311		428		Increase in additional paid-in-capital for redemption of noncontrolling OP units	36		311
Change from net income attributable to shareholders and transfers from noncontrolling interests	Change from net income attributable to shareholders and transfers from noncontrolling interests	$	41,353	$	18,582	Change from net income attributable to shareholders and transfers from noncontrolling interests	$	10,658	$	41,353

(12)Related Party Transactions

There were no related party transactions other than those disclosed elsewhere in this Quarterly Report and the audited consolidated financial statements in the Annual Report.

(13)Commitments and Contingencies

In addition to the commitments and contingencies disclosed elsewhere, the Company has the following commitments and contingencies.

The Company is obligated under certain tenant leases, including its proportionate share for leases for non-consolidated entities, to fund the expansion of the underlying leased properties. The Company, under certain circumstances, may guarantee to tenants the completion of base building improvements and the payment of tenant improvement allowances and lease commissions on behalf of its subsidiaries.

As of March 31, ~~2021,~~2022, the Company ~~has committed to develop 3~~had 5 ongoing consolidated development projects and expects to incur approximately ~~$93,475~~$229,840 and ~~$27,908~~$13,929 in ~~2021~~the remainder of 2022 and ~~2022,~~2023, respectively, excluding noncontrolling interests' share, to substantially complete the construction of the projects. ~~The remaining~~As of March 31, 2022, the Company had 2 ~~development projects are owned by~~consolidated and 2 non-consolidated joint ~~ventures. Due to the early stage of development of each non-consolidated project and the uncertainty of construction schedules at such stage, the~~ventures that own land parcels held for development. The Company is unable to estimate the timing of ~~the~~any required ~~fundings~~funding for the ~~non-consolidated~~potential development ~~projects.~~projects on these parcels.

The Company and LCIF are parties to a funding agreement under which the Company may be required to fund distributions made on account of LCIF's OP units. Pursuant to the funding agreement, the parties agreed that, if LCIF does not have sufficient cash available to make a quarterly distribution to its limited partners in an amount in accordance with the partnership agreement, ~~Lexington~~LXP will fund the shortfall. Payments under the agreement will be made in the form of loans to LCIF and will bear interest at prevailing rates as determined by the Company in its discretion but, no less than the applicable federal rate. LCIF's right to receive these loans will expire if no OP units remain outstanding and all such loans are repaid. No amounts have been advanced under this agreement.

From time to time, the Company is directly or indirectly involved in legal proceedings arising in the ordinary course of business. Management believes, based on currently available information, and after consultation with legal counsel, that although the outcomes of those normal course proceedings are uncertain, the results of such proceedings, in the aggregate, will not have a material adverse effect on the Company's business, financial condition and results of operations.

(14)Supplemental Disclosure of Statement of Cash Flow Information

In addition to disclosures discussed elsewhere, during the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, the Company paid ~~$10,480~~$9,261 and ~~$7,658,~~$10,480, respectively, for interest and ~~$295~~$36 and ~~$472,~~$295, respectively, for income taxes.

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~~LEXINGTON REALTY~~LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, ~~2021~~2022 and ~~2020~~2021

(Unaudited and dollars in thousands, except share/unit and per share/unit data)

~~As a result of the foreclosure of an office property located in South Carolina, during~~During the three months ended March 31, ~~2020, there was a~~2022 and 2021, the Company had $34,636 and $9,935 respectively, of accrued non-cash ~~change of $6,830 and $5,429~~assets in ~~mortgages and notes payable, net, and~~investments in real estate ~~net, respectively.~~under construction.

~~The~~During the three months ended March 31, 2021, the acquisition of the RR Ocala 44, LLC joint venture included a $489 non-cash increase to investments in real estate under construction and the noncontrolling interest because a member of the joint venture made a non-cash contribution of the land in exchange for its ownership interest in the joint venture.

(15)Subsequent Events

Subsequent to March 31, ~~2021,~~2022, the Company:

••acquired a warehouse/distribution facility in the Phoenix, Arizona market for a cost of approximately $59,000;

•borrowed $80,000 on the revolving credit facility, net;

•commenced development of 2 warehouse/distribution facilities in the Central Florida market;

•disposed of ~~1 property~~3 properties for aaggregate gross ~~disposition~~proceeds of approximately $55,000; and

•repurchased 1,238,427 common shares at an average price of ~~approximately $40,100; and~~$13.41 per common share under the share repurchase program.

•~~entered into a joint venture to construct an industrial property in the Indianapolis, Indiana market.~~

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ITEM 2. ~~MANAGEMENT’S~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

Introduction

When we use the terms ~~“the~~ the “Company,~~” “we,” “us”~~” the “Trust,” “LXP,” “we,” “our,” and ~~“our,”~~“us,” we ~~mean Lexington Realty~~refer collectively to LXP Industrial Trust and its consolidated subsidiaries. All of the Company's interests are held, and all of the property operating activities are conducted through special purposes entities, ~~owned by us, including non-consolidated~~which we refer to as property owner subsidiaries or lender subsidiaries and are separate and distinct legal entities, ~~except where it is clear that the term means only Lexington Realty Trust.~~but in some instances are consolidated for financial statement purposes and/or disregarded for income tax purposes. References herein to ‘‘‘‘this Quarterly ~~Report”~~Report” are to this Quarterly Report on Form 10-Q for the three months ended March 31, ~~2021.~~2022. The results of operations contained herein for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 are not necessarily indicative of the results that may be expected for a full year.

When we use the term “REIT,” we mean real estate investment trust. All references to 2022 and 2021, refer to the periods ending March 31, 2022 and 2021, respectively and our fiscal year ended December 31, 2021.

When we use the term “GAAP,” we mean United States generally accepted accounting principles in effect from time to time.

When we use the term “common shares,” we mean our shares of beneficial interest par value $0.0001, classified as common stock. When we use the term “Series C Preferred Shares,” we mean our beneficial interest classified as 6.50% Series C Cumulative Convertible Preferred Stock.

When we use the term “base rent,” we mean GAAP rental revenue and ancillary income, excluding billed tenant reimbursements and lease termination income.

The following is a discussion and analysis of the unaudited condensed consolidated financial condition and results of operations of ~~Lexington Realty~~LXP Industrial Trust for the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, and significant factors that could affect its prospective financial condition and results of operations. This discussion should be read together with the accompanying unaudited condensed consolidated financial statements of the Company included herein and notes thereto and with the consolidated financial statements and notes thereto included in the Company's most recent Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission, or SEC, on February ~~18, 2021,~~24, 2022, which we refer to as the Annual Report. Historical results may not be indicative of future performance.

Forward-Looking Statements. This Quarterly Report, together with other statements and information publicly disseminated by us, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, ~~which we refer to as~~or the Exchange Act. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and include this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words ~~“believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects,” “may,” “plans,” “predicts,” “will,” “will~~“believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects,” “may,” “plans,” “predicts,” “will,” “will likely ~~result”~~result” or similar expressions. Readers should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could materially affect actual results, performances or achievements. In particular, among the factors that could cause actual results, performances or achievements to differ materially from current expectations, strategies or plans include, among others, ~~any~~those risks discussed below in ~~“Management's~~“Management's Discussion and Analysis of Financial Condition and Results of Operations,”” and under the headings ~~“Risk Factors”~~“Risk Factors” in this Quarterly Report and ~~“Risk Factors”~~under “Risk Factors” in Part I, Item A and ~~“Management's~~“Management's Discussion and Analysis of Financial Condition and Results of ~~Operations”~~Operations” in Part II, Item 7 of the Annual Report and other periodic reports filed by the Company with the SEC. Except as required by law, we undertake no obligation to publicly release any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Accordingly, there is no assurance that our expectations will be realized.

Overview

~~COVID-19 Impact.~~ On March 11, 2020, the World Health Organization declared COVID-19 a pandemic, and on March 13, 2020 the United States declared a national emergency with respect to COVID-19. Our management continues to monitor events and is taking steps to mitigate the potential impact and risks to us.

~~We have received a limited number of, and may in the future receive, rent relief requests from our tenants. However, as~~As of March 31, ~~2021,~~2022, we ~~do not believe that these rent relief requests will have a material impact on our rental revenues. A limited number~~had equity ownership interests in approximately 123 consolidated real estate properties, located in 23 states and containing an aggregate of our other tenants, particularly retail tenants and those with businesses tied to the aviation industry, continue to be impacted by COVID-19 and related government restrictions and social distancing requirements. We continue to believe that the impactsapproximately 55.6 million square feet of ~~COVID-19 on~~space, approximately 98.9% of which was leased.

Since December 31, 2015 through March 31, 2022, we transitioned our portfolio ~~are mitigated due~~from approximately 16% warehouse/distribution assets to approximately 98% warehouse/distribution assets. As of March 31, 2022, our ~~focus on warehouse~~portfolio consisted of 111 warehouse/distribution facilities and ~~distribution properties and the diversity of our tenant base, both geographically and by industry exposure.~~

~~There has continued to be increased competition for investment in warehouses and distribution properties due to the resilience of this part of the industrial sector during the COVID-19 pandemic.~~

~~We remain unable to estimate the long-term impacts COVID-19 will have on our financial condition.~~

12 other properties.

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On February 8, 2022, we announced that our Board of Trustees initiated a review of our strategic alternatives. On April 8, 2022, we announced that our Board of Trustees suspended the review of strategic alternatives.

First Quarter ~~2021~~2022 Transaction Summary.

The following summarizes our significant transactions during the three months ended March 31, ~~2021.~~2022.

Leasing Activity:

During the first quarter of ~~2021,~~2022, we entered into new leases and lease extensions encompassing ~~1.5~~2.3 million square feet. The average fixed rent on these extended leases was ~~$3.59~~$5.68 per square foot compared to the average fixed rent on these leases before extension of ~~$3.13~~$5.04 per square foot. The weighted-average cost of tenant improvements and lease commissions was ~~$3.84~~$0.25 per square foot for extended leases and $8.83 per square foot for new ~~leases and $1.33 per square foot for extended~~ leases.

Investments:

During the three months ended March 31, ~~2021,~~2022, we ~~acquired/completed~~acquired the following warehouse/distribution assets:

Market Square Feet Initial Capitalized Cost (millions) Date Acquired/Completed Approximate Lease Term (years)
Indianapolis, IN 149,072 $ 14.3 January 2021 4
Indianapolis, IN 149,072 14.1 January 2021 6
Central Florida 222,134 22.4 January 2021 10
Columbus, OH 320,190 18.4 March 2021 3
840,468 $ 69.2


Market	Square Feet	Initial Capitalized Cost (millions)		Date Acquired	Approximate Lease Term (years)	% Leased at Acquisition
Cincinnati/Dayton, OH(1)	232,500	$	23.4	February 2022	N/A	—	%
Cincinnati/Dayton, OH	544,320	48.6		February 2022	10	100	%
	776,820	$	72.0

(1) Subsequent to acquisition, property was fully leased for approximately nine years.

•~~We also invested an aggregate of $24.0 million in five on-going development projects; and~~Capital Recycling:

•~~Commenced development of a 1.1 million square foot warehouse/distribution property in the Central Florida market.~~

~~Capital Recycling:~~

••Disposed of our ~~interests~~interest in ~~four~~one consolidated land parcel for a disposition price of $0.3 million.

•NNN Office JV L.P. disposed of two properties for an aggregate gross disposition price of ~~$58.1~~$168.5 million and satisfied an aggregate of $109.0 million of non-recourse variable-rate debt. We own 20% of the joint venture and we received aggregate proceeds of $11.5 million.

Equity:

••~~Entered into forward sales contracts to sell~~Settled 3.6 million common shares ~~under our At-the-Market offering program~~previously sold on a forward basis for net proceeds of $38.5 million.

Development Activity:

As of March 31, 2022, we had five consolidated development projects in process with an aggregate ~~settlement price~~estimated total cost of ~~$40.0 million at March 31, 2021.~~

$466.4 million. We anticipate our remaining funding obligation to substantially complete the construction of these five projects, exclusive of our joint venture partners' share, to be approximately $243.8 million. However, the risks associated with development, including supply chain issues, could adversely impact our estimates.

Critical Accounting ~~Policies~~Estimates

~~Management's discussion~~In preparing the consolidated financial statements we have made estimates and ~~analysis~~assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Accounting estimates are deemed critical if they involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations. Below is a summary of the critical accounting estimates used in the preparation of our unaudited condensed consolidated financial statements. A summary of our significant accounting policies which are important to the portrayal of our financial condition and results of operations is ~~based upon~~set forth in (1) Note 2 to our ~~unaudited condensed~~audited consolidated financial statements, which ~~have been prepared~~are included in ~~accordance with GAAP. In preparing our unaudited condensed consolidated financial statements~~“Financial Statements and Supplementary Data” in ~~accordance with GAAP and pursuant to the rules and regulations~~Part II, Item 8 of the SEC, we make assumptions, judgments and estimates that affect the reported amounts of assets, liabilities, revenue, and expenses, and related disclosures of contingent assets and liabilities. We base our assumptions, judgments and estimates on historical experience and various other factors that we believe to be reasonable under the circumstances, including the recent economic uncertainty primarily caused by COVID-19. Actual results could differ materially from these estimates under different assumptions or conditions. On a regular basis, we evaluate our assumptions, judgments and estimates. Certain of our accounting policies are discussed under (1) Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report, (2) note 2 to our consolidated financial statements contained in our Annual Report and ~~(3) note 1~~(2) Note 2 to our unaudited condensed consolidated financial statements contained in this Quarterly Report. We believe there have been no material changes to the items that we disclosed as our critical accounting policies under Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report.

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Acquisition of Real Estate. Primarily all of our acquisitions of real estate assets and liabilities are accounted for as asset acquisitions. As such, the purchase prices of acquired tangible and intangible assets and liabilities are recorded and allocated at fair value on a relative basis. The recorded allocations of tangible assets are based on the “as-if-vacant” value using estimated cash flow projections of the properties acquired which incorporates discount, capitalization and interest rates as well as available comparable market information. Allocations of intangible assets includes management’s estimates of current market rents and leasing costs.

We use considerable judgement in our estimates of cash flow projections, discount, capitalization and interest rates, fair market lease rates, carrying costs during hypothetical expected lease-up periods and costs to execute similar leases. While our methodology for purchase price allocation did not change during the three months ended March 31, 2022, the real estate market is fluid and our assumptions are based on information currently available in the market at the time of acquisition. Significant increases or decreases in these key estimates, particularly with regards to cash flow projections and discount and capitalization rates, would result in a significantly lower or higher fair value measurement of the real estate assets being acquired.

Revenue Recognition. We enter into agreements with tenants that convey the right to control the use of identified space at our properties in exchange for rental revenue. These agreements meet the criteria for recognition as leases under Accounting Standards Codification (“ASC”) 842, Leases. We recognize lease revenue on a straight-line basis over the term of the lease unless another systematic and rational basis is more representative of the time pattern in which the use benefit is derived from the leased property. We commence revenue recognition when possession or control of the space is turned over to the tenant.

We evaluate the collectability of our rental payments and recognize revenue on a cash basis when we believe it is no longer probable that we will receive substantially all of the remaining lease payments. Management exercises judgment in assessing collectability of tenant receivables and considers payment history, current credit status, publicly available information about the financial condition of the tenant and other factors. Our assessment of the collectability of tenant receivables can have a significant impact on the rental revenue recognized in our unaudited condensed consolidated statements of operations.

Impairment of Real Estate. We record impairments of our real estate assets classified as held for use when triggering events dictate that an asset may be impaired. An impairment is recorded when the carrying amount of the asset exceeds the sum of its undiscounted future operating and residual cash flows. The impairment recorded is the difference between estimated fair value of the asset and the carrying amount. We record impairments of our real estate assets classified as held for sale at the lower of the carrying amount or estimated fair value using the estimated or contracted sales price less costs to sell. Any real estate assets recorded at fair value on a non-recurring basis as a result of our impairment analysis are valued using unobservable local and national industry market data such as comparable sales, appraisals, brokers’ opinions of value and/or terms of definitive sales contracts. Additionally, the analysis includes considerable judgement in our estimates of hold periods, projected cash flows and discount and capitalization rates. Significant increases or decreases in any of these inputs, particularly with regards to cash flow projections and discount and capitalization rates, would result in a significantly lower or higher fair value measurement of the real estate assets being assessed.

We will record an impairment charge related to our investments, including investments in non-consolidated entities, if we determine the fair value of the investments are less than their carrying value and such impairment is other-than-temporary. We evaluate whether events or changes in circumstances indicate that the carrying amount of our investments may not be recoverable. Our evaluation of changes in economic or operating conditions and whether an impairment is other-than-temporary may include developing estimates of fair value, forecasted cash flows or operating income before depreciation and amortization. We estimate undiscounted cash flows and fair value using observable and unobservable data such as operating income, hold periods, estimated capitalization and discount rates, or relevant market multiples, leasing prospects and local market information and whether certain impairments are other-than-temporary.

Liquidity and Capital Resources

Cash Flows. We believe that cash flows from operations will continue to provide adequate capital to fund our operating and administrative expenses, regular debt service obligations and all dividend payments in accordance with applicable REIT requirements in both the short-term and long-term. However, our cash flow from operations may be negatively affected in the near term if we grant tenant rent relief packages or experience tenant defaults as a result of the effects of ~~COVID-19.~~the current economic conditions. In addition, we anticipate that cash on hand, borrowings under our unsecured revolving credit facility, capital recycling proceeds, issuances of equity, mortgage proceeds and other debt, as well as other available alternatives, will provide the necessary capital required by our business.

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At March 31, ~~2021, one of~~2022, our ~~property owner subsidiaries has a balloon payment of $10.4 million maturing in 2021. Our~~ property owner subsidiaries do not have ~~additional~~ mortgage maturities with balloon payments due until ~~2025. With respect~~2031. In addition, certain of our subsidiaries are obligated to ~~mortgages encumbering properties where~~fund the ~~expected lease rental revenues are sufficient to provide an estimated property value in excess~~construction of ~~the mortgage balance,~~our development projects and we sometimes guaranty these obligations. We believe our property owner subsidiaries have sufficient sources of liquidity to meet these obligations through future cash flows from operations, the credit markets and, if determined appropriate by us, a capital contribution from us from either cash on hand ($~~142.1~~49.1 million at March 31, ~~2021)~~2022), property sale proceeds, borrowing capacity under our unsecured revolving credit facility ($~~600~~600.0 million at March 31, ~~2021,~~2022, subject to covenant compliance), which expires in 2023, but can be extended by us to 2024, unsettled forward common share sale contracts, and future cash flows from operations.

Cash flows from operations were $42.1 million for the three months ended March 31, 2022 as compared to $57.4 million for the three months ended March 31, ~~2021 as compared to $45.7 million for the three months ended March 31, 2020.~~2021. The ~~increase~~decrease was primarily related to property sales and a decrease in termination fee income, partially offset by the impact of cash flow generated from acquiring ~~properties and termination fee income, partially offset by property sales and vacancies.~~properties. The underlying drivers that impact our working capital, and therefore cash flows from operations, are the timing of collection of rents, including reimbursements from tenants, payment of interest on mortgage debt and payment of operating and general and administrative costs. We believe the net-lease structure of the leases encumbering a majority of the properties in which we have an interest mitigates the risks of the timing of cash flows from operations since the payment and timing of operating costs related to the properties are generally borne directly by the tenant. The collection and timing of tenant rents are closely monitored by management as part of our cash management program.

Net cash used in investing activities totaled ~~$(24.9)~~$152.5 million and ~~$(183.2)~~$24.9 million during the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, respectively. Cash used in investing activities related primarily to acquisitions of real estate, investments in real estate under construction, capital expenditures, lease costs, investments in non-consolidated entities and changes in real estate deposits, net. Cash provided by investing activities primarily related to net proceeds received from the disposition of real estate and distributions from non-consolidated entities.

Net cash ~~(used in) provided by~~used in financing activities totaled ~~$(41.7)~~$31.4 million and ~~$98.3~~$41.7 million during the three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, respectively. ~~Cash used in financing activities primarily related to dividend and debt service payments.~~ Cash provided by financing activities primarily related to ~~credit facility borrowings,~~the issuances of common shares and cash contributions from noncontrolling interests. Cash used in financing activities primarily related to the purchase of a noncontrolling interest and dividend and debt service payments.

Common Share Issuances:

At-The-Market Offering Program. We maintain an At-The-Market offering program ("ATM program") under which the Company can issue common shares, including through forward sales contracts. ~~The following table summarizes common share issuances under the ATM program for~~

During the three months ended March 31, ~~2020:~~

Three months ended March 31, 2020
Shares Sold Net Proceeds
2020 ATM Issuances 1,559,714 $ 17.3 million

~~We entered into~~2022, we settled 3.6 million common shares previously sold in 2021 on a forward ~~sales~~basis on the maturity date of the contracts ~~for the sale~~and received $38.5 million of ~~3,649,023 common shares~~net proceeds. There were no forward share settlements during the three months ended March 31, ~~2021 that have not yet been settled. Subject to our right to elect cash or net share settlement, we expect to settle the~~2021. All forward sales ~~transactions by the maturity dates in February 2022. As~~contracts under our ATM program have been settled as of March 31, 2021, an aggregate of 8,639,740 common shares were sold in forward sales contracts that have not been settled and had an aggregate settlement price of $94.5 million, which is subject to adjustment in accordance with the forward sales contracts.2022.

In ~~March~~February 2021, we amended the terms of our ATM offering program, under which we may, from time to time, sell up to $350.0 million common shares over the term of the program. As of March 31, ~~2021,~~2022, common shares with an aggregate value of ~~$309.0~~$295.0 million remain available for issuance under the ATM program.

~~Table~~Underwritten Equity Offerings. In May 2021, we entered into forward sales contracts for the sale of ~~Contents~~16,000,000 common shares at a public offering price of $12.11 per common share in an underwritten equity offering that have not yet settled. The forward sales contracts mature in May 2022, subject to our right to elect cash or net share settlement. As of March 31, 2022, the forward sales contracts had an aggregate settlement price of $185.3 million, which is subject to adjustment in accordance with the forward sales contracts.

The volatility in the capital markets primarily resulting from the effects of the ~~COVID-19 pandemic~~current economic conditions may negatively affect our ability to access the capital markets through our ATM program and other offerings.

Dividends. Dividends paid to our common and preferred shareholders were ~~$33.5~~$36.8 million and ~~$29.5~~$33.5 million in the three months ended March 31, 2022 and 2021, ~~and 2020,~~ respectively.

We declared a quarterly dividend of ~~$0.1075~~$0.12 per common share during the three months ended March 31, ~~2021,~~2022, which is an increase from the ~~$0.105~~$0.1075 per common share quarterly dividend declared during the three months ended March 31, ~~2020.~~2021.

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UPREIT Structure. As of March 31, ~~2021, 2.5 million~~2022, 769,000 units of limited partner interests, or OP units, in our operating partnership, LCIF, were outstanding not including OP units held by us. Assuming all outstanding OP units not held by us were redeemed on such date, the estimated fair value of such OP units was ~~$31.1~~$13.6 million based on our closing price of ~~$11.11~~$15.70 per common share as of March 31, ~~2021~~2022 and a redemption factor of approximately 1.13 common shares per OP unit.

Financings. The following senior notes were outstanding as of March 31, ~~2021:~~2022:

Issue Date Face Amount ($000) Interest Rate Maturity Date Issue Price
August 2020 $ 400,000 2.70 % September 2030 99.233 %
May 2014 198,932 4.40 % June 2024 99.883 %
June 2013 188,756 4.25 % June 2023 99.026 %
$ 787,688


Issue Date	Face Amount ($000)		Interest Rate		Maturity Date	Issue Price
August 2021	$	400,000	2.375	%	October 2031	99.758	%
August 2020	400,000		2.70	%	September 2030	99.233	%
May 2014	198,932		4.40	%	June 2024	99.883	%
	$	998,932

Each series of senior notes is unsecured and requires payment of interest semi-annually in arrears. We may redeem the notes at our option at any time prior to maturity in whole or in part by paying the principal amount of the Senior Notes being redeemed plus a make-whole premium.

A summary of the maturity dates and interest rates of our unsecured credit agreement, as of March 31, ~~2021,~~2022, are as follows:


	Maturity Date	Current Interest Rate
$600.0 Million Revolving Credit Facility(1)	February 2023	LIBOR + 0.90%
$300.0 Million Term Loan(2)	January 2025	LIBOR + 1.00%

(1) Maturity date of the revolving credit facility can be extended to February 2024 at our option. The interest rate ranges from LIBOR plus 0.775% to 1.45%. At March 31, ~~2021,~~2022, we had no borrowings outstanding and availability of $600.0 million, subject to covenant compliance.

(2) The LIBOR portion of the interest rate was swapped to obtain a current fixed rate of 2.732% per annum.

As of March 31, ~~2021,~~2022, we were compliant with all applicable financial covenants contained in our corporate-level debt agreements.

Contractual Obligations

As of March 31, 2022, we had five ongoing consolidated development projects and expect to incur approximately $229.9 million and $13.9 million of costs in the remainder of 2022 and 2023, respectively, excluding noncontrolling interests' share, to substantially complete the construction of such projects. As of March 31, 2022, we had two consolidated and two non-consolidated joint ventures that own land parcels held for development. We are unable to estimate the timing of any required funding for potential development projects on these parcels.

Results of Operations

Three months ended March 31, ~~2021~~2022 compared with three months ended March 31, ~~2020~~2021. The ~~increase~~decrease in net income attributable to common shareholders of ~~$22.9~~$30.4 million was primarily due to the items discussed below.

The ~~increase~~decrease in total gross revenues of ~~$11.7~~$12.3 million was primarily ~~a result of an increase in rental revenue. Rental revenue increased primarily~~ due to ~~acquisitions and an increase of $10.8 million~~a decrease in termination income of $10.9 million recognized during the three months ended March 31, 2021. ~~The increase~~In addition, property sales, including the recapitalization of our special purpose industrial portfolio now owned in a non-consolidated joint venture, contributed to the decrease which was partially offset by a $1.1 million decrease in other revenue primarily due to an incentive fee earned upon the sale of a property that we managed for a third-party real estate owner in 2020 with no comparable revenue earned in 2021.acquisition revenue.

The increase in depreciation and amortization expense of ~~$1.7~~$2.3 million was primarily due to acquisition activity.

The increase in property operating expense of ~~$0.7~~$3.7 million was primarily due to an increase in operating expense responsibilities at certain properties.

The increase in general and administrative expenses of ~~$0.6~~$2.3 million was primarily due to an increase of $1.2 million in costs incurred related to the Board of Trustees strategic alternatives review and consulting costs related to activism. The remaining $1.1 million increase is primarily payroll expense.

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The decrease in interest and amortization expense of ~~$3.3~~$0.8 million related primarily to a decrease in the amount of our mortgage debt outstanding and a decrease in our overall borrowing rate.

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The decrease ~~in debt satisfaction gains, net, of $1.4 million was primarily related to the foreclosure of our Charleston, South Carolina property in 2020 with no comparable transactions in 2021.~~

~~The increase~~ in gains on sales of properties of ~~$12.1~~$21.7 million was related to the timing of property dispositions.

The increase in ~~net income or decrease~~equity in ~~net loss in future periods will be closely tied to the level~~earnings (losses) of ~~acquisitions made by us. Without acquisitions, the sources~~non-consolidated entities of growth in net income are limited to fixed rent adjustments and index adjustments (such as the consumer price index), reduced interest expense on amortizing mortgages and variable rate indebtedness and by controlling other variable overhead costs. However, there are many factors beyond management's control that could offset these items including, without limitation, changes in economic conditions such as the recent economic uncertainty$11.4 million was primarily caused by the COVID-19 pandemic, increased interest rates and tenant monetary defaults and the other risks described in this Quarterly Report. Furthermore, our ability to complete acquisitions may be limited due to ~~travel restrictions and social distancing measures during~~recognizing our share of gains on sale of two properties from the ~~COVID-19 pandemic.~~NNN Office JV L.P. in 2022 with no property sales at our non-consolidated entities in 2021.

Same-Store Results

Same-store net operating income, or NOI, which is a non-GAAP measure, represents the NOI for consolidated properties that were owned and included in our portfolio for two comparable reporting periods. We define NOI as operating revenues (rental income (less GAAP rent adjustments and lease termination ~~income)~~income, net), and other property income) less property operating expenses. As same-store NOI excludes the change in NOI from acquired and disposed of properties, it highlights operating trends such as occupancy levels, rental rates and operating costs on properties. Other REITs may use different methodologies for calculating same-store NOI, and accordingly same-store NOI may not be comparable to other REITs. Management believes that same-store NOI is a useful supplemental measure of our operating performance. However, same-store NOI should not be viewed as an alternative measure of our financial performance since it does not reflect the operations of our entire portfolio, nor does it reflect the impact of general and administrative expenses, acquisition-related expenses, interest expense, depreciation and amortization costs, other nonproperty income and losses, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, or trends in development and construction activities which are significant economic costs and activities that could materially impact our results from operations. We believe that net income is the most directly comparable GAAP measure to same-store NOI.

The following presents our consolidated same-store NOI, for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 ($000's):

Three Months Ended March 31,
2021 2020
Total cash base rent $ 60,695 $ 60,375
Tenant reimbursements 7,258 6,732
Property operating expenses (8,434) (7,919)
Same-store NOI $ 59,519 $ 59,188


	Three Months Ended March 31,
	2022		2021
Total cash base rent	$	54,756	$	52,736
Tenant reimbursements	9,417		8,818
Property operating expenses	(11,176)		(9,837)
Same-store NOI	$	52,997	$	51,717

Our reported same-store NOI increased from the first three months of ~~2020~~2021 to the first three months of ~~2021~~2022 by ~~0.6%.~~2.5% primarily due to an increase in occupancy and cash base rents. As of March 31, ~~2021~~2022 and ~~2020,~~2021, our historical same-store square footage leased was ~~97.5%~~99.4% and ~~99.4%~~98.4%, respectively.

The increase in same-store NOI between periods primarily related to an increase in cash base rent and tenant reimbursements, which was partially offset by an increase in operating expense responsibilities at certain properties. Our same-store results could be further impacted in the future due to COVID-19 related rent deferrals, rent forgiveness or tenant defaults (in the short-term and/or long-term).

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Below is a reconciliation of net income to same-store NOI for periods presented ($000's):

Three Months Ended March 31,
2021 2020
Net income $ 41,475 $ 18,420
Interest and amortization expense 11,486 14,795
Provision for income taxes 372 653
Depreciation and amortization 42,176 40,509
General and administrative 8,420 7,825
Transaction costs 11 21
Non-operating/advisory fee income (1,230) (1,889)
Gains on sales of properties (21,919) (9,805)
Debt satisfaction gains, net — (1,393)
Equity in (earnings) losses of non-consolidated entities 90 (263)
Lease termination income (10,941) (141)
Straight-line adjustments (2,020) (1,419)
Lease incentives 219 269
Amortization of above/below market leases (460) (295)
NOI 67,679 67,287
Less NOI:
Acquisitions and dispositions (8,160) (8,099)
Same-Store NOI $ 59,519 $ 59,188


	Three Months Ended March 31,
	2022		2021
Net income	$	10,908	$	41,475

Interest and amortization expense	10,682		11,486
Provision for income taxes	417		372
Depreciation and amortization	44,506		42,176
General and administrative	10,737		8,420
Transaction costs	89		11
Non-operating/advisory fee income	(1,483)		(1,230)
Gains on sales of properties	(255)		(21,919)


Equity in (earnings) losses of non-consolidated entities	(11,301)		90
Lease termination income, net	—		(10,941)
Straight-line adjustments	(3,502)		(2,020)
Lease incentives	134		219
Amortization of above/below market leases	(480)		(460)
NOI	60,452		67,679

Less NOI:
Acquisitions and dispositions	(7,455)		(15,962)

Same-Store NOI	$	52,997	$	51,717

Funds From Operations

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

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

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

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The following presents a reconciliation of net income attributable to common shareholders to FFO available to common shareholders and unitholders and Adjusted Company FFO available to all equityholders and unitholders for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 (unaudited and dollars in thousands, except share and per share amounts):


			Three Months Ended March 31,					Three Months Ended March 31,
			2021		2020				2022		2021
FUNDS FROM OPERATIONS:	FUNDS FROM OPERATIONS:						FUNDS FROM OPERATIONS:
Basic and Diluted:	Basic and Diluted:						Basic and Diluted:
Net income attributable to common shareholders	Net income attributable to common shareholders		$	39,401	$	16,536	Net income attributable to common shareholders		$	8,989	$	39,401
Adjustments:	Adjustments:						Adjustments:
Depreciation and amortization							Depreciation and amortization		43,850		41,478
		Depreciation and amortization	41,478		39,717

		Noncontrolling interests - OP units	239		107
		Amortization of leasing commissions	698		792
		Joint venture and noncontrolling interest adjustment	2,115		2,214
		Gains on sales of properties, including non-consolidated entities	(21,919)		(10,354)
Noncontrolling interests - OP units							Noncontrolling interests - OP units		89		239
Amortization of leasing commissions							Amortization of leasing commissions		656		698
Joint venture and noncontrolling interest adjustment							Joint venture and noncontrolling interest adjustment		3,150		2,115
Gains on sales of properties, including non-consolidated entities, net of tax							Gains on sales of properties, including non-consolidated entities, net of tax		(11,526)		(21,919)
FFO available to common shareholders and unitholders - basic	FFO available to common shareholders and unitholders - basic		62,012		49,012		FFO available to common shareholders and unitholders - basic		45,208		62,012
		Preferred dividends	1,572		1,572
		Amount allocated to participating securities	69		46
Preferred dividends							Preferred dividends		1,572		1,572
Amount allocated to participating securities							Amount allocated to participating securities		61		69
FFO available to all equityholders and unitholders - diluted	FFO available to all equityholders and unitholders - diluted		63,653		50,630		FFO available to all equityholders and unitholders - diluted		46,841		63,653
		Transaction costs	11		21
Transaction costs							Transaction costs		89		11
Strategic alternatives and activism costs							Strategic alternatives and activism costs		1,181		—
		Debt satisfaction gains, net, including non-consolidated entities	—		(1,372)
Adjusted Company FFO available to all equityholders and unitholders - diluted	Adjusted Company FFO available to all equityholders and unitholders - diluted		$	63,664	$	49,279	Adjusted Company FFO available to all equityholders and unitholders - diluted		$	48,111	$	63,664


Per Common Share and Unit Amounts
Basic:
FFO	$	0.16	$	0.22


Diluted:
FFO	$	0.16	$	0.22
Adjusted Company FFO	$	0.16	$	0.22




Weighted-Average Common Shares:
Basic:
Weighted-average common shares outstanding - basic EPS	283,640,465	275,416,327
Operating partnership units(1)	871,037	2,852,419
Weighted-average common shares outstanding - basic FFO	284,511,502	278,268,746

Diluted:
Weighted-average common shares outstanding - diluted EPS	289,067,778	279,053,697

Operating partnership units(1)	871,037	—
Unvested share-based payment awards	59,384	9,125
Preferred shares - Series C	4,710,570	4,710,570
Weighted-average common shares outstanding - diluted FFO	294,708,769	283,773,392

Per Common Share and Unit Amounts
Basic:
FFO $ 0.22 $ 0.19
Diluted:
FFO $ 0.22 $ 0.19
Adjusted Company FFO $ 0.22 $ 0.19

Weighted-Average Common Shares:
Basic:
Weighted-average common shares outstanding - basic EPS 275,416,327 253,038,161
Operating partnership units(1)
2,852,419 3,148,122
Weighted-average common shares outstanding - basic FFO 278,268,746 256,186,283
Diluted:
Weighted-average common shares outstanding - diluted EPS 279,053,697 257,347,277
Unvested share-based payment awards 9,125 24,799
Preferred shares - Series C 4,710,570 4,710,570
Weighted-average common shares outstanding - diluted FFO 283,773,392 262,082,646

(1) Includes all OP units other than OP units held by us.

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Off-Balance Sheet Arrangements

As of March 31, ~~2021,~~2022, we had investments in various real estate entities with varying structures. The real estate investments owned by these entities are generally financed with non-recourse debt. Non-recourse debt is generally defined as debt whereby the lenders' sole recourse with respect to borrower defaults is limited to the value of the assets collateralized by the debt. The lender generally does not have recourse against any other assets owned by the borrower or any of the members or partners of the borrower, except for certain specified exceptions listed in the particular loan documents. These exceptions generally relate to "bad boy" acts, including fraud, prohibited transfers and breaches of material representations. We have guaranteed such obligations for certain of our non-consolidated ~~entities.~~entities with respect to $666.7 million of such non-recourse debt. We believe the likelihood of making any payments under such guaranties is remote and we generally have an agreement from each partner to reimburse us for its proportionate share of any liability related to a guarantee trigger unless such trigger is caused solely by us.

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ITEM 3. QUANTITATIVE AND QUALITATIVE

DISCLOSURES ABOUT MARKET RISK

Our exposure to market risk relates primarily to our variable-rate indebtedness not subject to interest rate swaps and our fixed-rate debt. Our consolidated aggregate principal variable-rate indebtedness not subject to interest rate swaps was $129.1 million ~~and $259.1 million~~ at each of March 31, ~~2021~~2022 and ~~2020,~~2021, which represented ~~9.6%~~8.6% and ~~18.0%~~9.6%, respectively, of our aggregate principal consolidated indebtedness. During the ~~three-month periods~~three months ended March 31, ~~2021~~2022 and ~~2020,~~2021, our variable-rate indebtedness had a weighted-average interest rate of 1.9% ~~and 3.0%, respectively.~~. Had the weighted-average interest rate been 100 basis points higher, our interest expense for the three months ended March 31, ~~2021~~2022 and ~~2020~~2021 would have increased by $0.3 million, ~~and $0.5 million, respectively. As~~each period. At each of ~~both~~ March 31, ~~2021~~2022 and ~~2020,~~2021, our aggregate principal consolidated fixed-rate debt was $1.4 billion and $1.2 billion, respectively, which represented ~~90.4%~~91.4% and ~~82.0%~~90.4%, respectively, of our aggregate principal indebtedness.

For certain of our financial instruments, fair values are not readily available since there are no active trading markets as characterized by current exchanges between willing parties. Accordingly, we derive or estimate fair values using various valuation techniques, such as computing the present value of estimated future cash flows using discount rates commensurate with the risks involved. However, the determination of estimated cash flows may be subjective and imprecise. Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values, especially given the volatility of the current economic environment. The following fair value was determined using the interest rates that we believe our outstanding fixed-rate indebtedness would warrant as of March 31, ~~2021.~~2022. We believe the fair value is indicative of the interest rate environment as of March 31, ~~2021,~~2022, but this amount does not take into consideration the effects of subsequent interest rate fluctuations. Accordingly, we estimate that the fair value of our fixed-rate indebtedness was ~~$1.2~~$1.3 billion as of March 31, ~~2021.~~2022.

Our interest rate risk objectives are to limit the impact of interest rate fluctuations on earnings and cash flows and to lower our overall borrowing costs. To achieve these objectives, we manage our exposure to fluctuations in market interest rates through the use of fixed-rate debt instruments to the extent that reasonably favorable rates are obtainable with such arrangements. We may enter into derivative financial instruments such as interest rate swaps or caps to mitigate our interest rate risk on a related financial instrument or to effectively lock the interest rate on a portion of our variable-rate debt. As of March 31, ~~2021,~~2022, we had four interest rate swap agreements (see note 8 to our unaudited condensed consolidated financial statements contained in this Quarterly Report).

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as such terms are defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report to determine if such controls and procedures were effective to ensure that information required to be disclosed by us in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and that information required to be disclosed by us in reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Management, including each of our Chief Executive Officer and Chief Financial Officer, has concluded that our disclosure controls and procedures were effective as of March 31, ~~2021.~~2022.

Changes in Internal Control Over Financial Reporting. There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this Quarterly Report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls. Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations. Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper management override. Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

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PART II - OTHER INFORMATION

ITEM 1.Legal Proceedings.

From time to time, we are directly and indirectly involved in legal proceedings arising in the ordinary course of our business, including claims by lenders under non-recourse carve-out guarantees. We believe, based on currently available information, and after consultation with legal counsel, that although the outcomes of those normal course proceedings are uncertain, the results of such proceedings, in the aggregate, will not have a material adverse effect on our business, financial condition and results of operations.

ITEM 1A.Risk Factors.

There have been no material changes in our risk factors from those disclosed in the Annual Report.

ITEM 2.Unregistered Sales of Equity Securities and Use of Proceeds.

There were no share repurchases during the quarter ended March 31, ~~2021~~2022 under our share repurchase authorization most recently announced on November 2, 2018, which has no expiration date. ~~There~~As of March 31, 2022, there were 8,976,315 shares that may yet be purchased under our share repurchase authorization.

ITEM 3.Defaults Upon Senior Securities - not applicable.

ITEM 4.Mine Safety Disclosures - not applicable.

ITEM 5.Other Information - not applicable.

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ITEM 6.Exhibits.


Exhibit No.		Description

3.1	——	Articles of Merger and Amended and Restated Declaration of Trust of the Company, dated December 31, 2006 (filed as Exhibit 3.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed January 8, 2007 (the ~~“01/~~“01/08/07 ~~8-K”~~8-K”))(1)
3.2	——	Articles Supplementary Relating to the Reclassification of 8.05% Series B Cumulative Redeemable Preferred Stock, par value $0.0001 per share, and 7.55% Series D Cumulative Redeemable Preferred Stock, par value $0.0001 per share (filed as Exhibit 3.4 to the Company's Current Report on Form 8-K filed November 21, 2013)(1)
3.3	—	Articles of Amendment to the Amended and Restated Declaration of Trust, dated as of December 14, 2021 (filed as of Exhibit 3.1 to the Company's Current Report on Form 8-K filed on December 16, 2021)(1)
3.4	——	Amended and Restated By-laws of the Company (filed as Exhibit 3.2 to the 01/08/07 8-K)(1)
~~3.4~~3.5	——	First Amendment to Amended and Restated By-laws of the Company (filed as Exhibit 3.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed November 20, 2009) (1)
~~3.5~~3.6	——	Second Amendment to Amended and Restated By-Laws of the Company (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K filed April 3, 2017) (1)
~~3.6~~3.7	——	Third Amendment to Amended and Restated By-Laws of the Company (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K filed April 9, 2020)(1)
3.3.87	——	Sixth Amended and Restated Agreement of Limited Partnership of LCIF, dated as of December 30, 2013 (filed as Exhibit 3.25 to the Company's Annual Report on Form 10-K filed February 26, 2014)(1)
3.9	—	First Amendment to Sixth Amended and Restated Agreement of Limited Partnership of LCIF, dated as of July 12, 2021 (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K filed July 16, 2021)(1)
4.1	——	Specimen of Common Shares Certificate of the Company (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Annual Report on Form 10-K for the year ended December 31, ~~2006)~~2021)(1)
4.2	——	Form of 6.50% Series C Cumulative Convertible Preferred Stock certificate (filed as Exhibit 4.1 to the Company's Registration Statement on Form 8A filed December 8, 2004)(1)
4.3	——	Indenture, dated as of January 29, 2007, among the Company (as successor by merger), the other guarantors named therein and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed January 29, 2007 (the ~~“01/~~“01/29/07 ~~8-K”~~8-K”))(1)
4.4	——	Amended and Restated Trust Agreement, dated March 21, 2007, among the Company, The Bank of New York Trust Company, National Association, The Bank of New York (Delaware), the Administrative Trustees (as named therein) and the several holders of the Preferred Securities from time to time (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed March 27, 2007 (the ~~“03/~~“03/27/2007 ~~8-K”~~8-K”))(1)
4.5	——	Junior Subordinated Indenture, dated as of March 21, 2007, between Lexington Realty Trust and The Bank of New York Trust Company, National Association (filed as Exhibit 4.2 to the 03/27/07 8-K)(1)
4.6	——	Fourth Supplemental Indenture, dated as of December 31, 2008, among the Company, the other guarantors named therein and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed January 2, 2009)(1)
4.7	——	Fifth Supplemental Indenture, dated as of June 9, 2009, among the Company (as successor to the MLP), the other guarantors named therein and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed June 15, 2009)(1)
4.8	——	Sixth Supplemental Indenture, dated as of January 26, 2010 among the Company, the guarantors named therein and U.S. Bank National Association, as trustee, including the Form of 6.00% Convertible Guaranteed Notes due 2030 (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed January 26, 2010)(1)
4.9	——	Seventh Supplemental Indenture, dated as of September 28, 2012, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed October 3, 2012)(1)
4.10	——	Eighth Supplemental Indenture, dated as of February 13, 2013, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed February 13, 2013 (the ~~“02/~~“02/13/13 ~~8-K”~~8-K”))(1)
4.11	——	Ninth Supplemental Indenture, dated as of May 6, 2013, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed May 8, 2013)(1)
4.12	——	Tenth Supplemental Indenture, dated as of June 13, 2013, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.3 to the Company's Current Report on Form 8-K filed on June 13, 2013 (the ~~“06/~~“06/13/13 ~~8-K”~~8-K”))(1)

Table of Contents

4.13

——

Tenth Supplemental Indenture, dated as of September 30, 2013, among the Company, certain subsidiaries of the Company signatories thereto, and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the ~~Company’s~~Company’s Current Report on Form 8-K filed on October 3, 2013 (the ~~“10/~~“10/03/2013 ~~8-K”~~8-K”))(1)

~~Table of Contents~~


4.14	——	Indenture, dated as of June 10, 2013, among the Company, the subsidiary guarantors named therein, and U.S. Bank National Association, as trustee ~~(filed~~(filed as Exhibit 4.1 to the 06/13/2013 8-K))(1)
4.15	——	First Supplemental Indenture, dated as of September 30, 2013, among the Company, the subsidiary guarantors named therein, and U.S. Bank National Association, as trustee (filed as Exhibit 4.2 to the 10/03/2013 8-K)(1)
4.16	——	Indenture dated as of May 9, 2014, among the Company, LCIF and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed May 13, 2014)(1)
4.17	——	First Supplemental Indenture, dated as of May 20, 2014, among the Company, LCIF and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed May 20, 2014)(1)
4.18	——	Second Supplemental Indenture, dated as of August 28, 2020, among the Company and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed August 28, 2020)(1)
~~10.1~~4.19	——	~~Amendment to Equity Sales Agreement,~~Third Supplemental Indenture, dated as of ~~February 19,~~August 30, 2021, ~~between~~among the Company and ~~Jefferies LLC, KeyBanc Capital Markets Inc., Regions Securities LLC, BofA Securities, Inc.,~~U.S. Bank ~~of America, N.A., Mizuho Securities USA LLC, Mizuho Markets Americas LLC and Evercore Group L.L.C.~~National Association, as trustee (filed as Exhibit ~~1.2~~4.1 to the Company's Current Report on Form 8-K filed ~~February 22,~~August 30, 2021)(1)
31.1	——	Certification pursuant to ~~rule~~R ule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002(2)
31.2	——	Certification pursuant to ~~rule~~R ule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002(2)
32.1	——	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(3)
32.2	——	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(3)
101.INS	——	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document (2, 5)
101.SCH	——	Inline XBRL Taxonomy Extension Schema (2, 5)
101.CAL	——	Inline XBRL Taxonomy Extension Calculation Linkbase (2, 5)
101.DEF	——	Inline XBRL Taxonomy Extension Definition Linkbase Document (2, 5)
101.LAB	——	Inline XBRL Taxonomy Extension Label Linkbase Document (2, 5)
101.PRE	——	Inline XBRL Taxonomy Extension Presentation Linkbase Document (2, 5)

(1) Incorporated by reference.

(2) Filed herewith.

(3) Furnished herewith. This exhibit shall not be deemed "filed" for purposes of Section 11 or 12 of the Securities Act of 1933, as amended (the "Securities Act"), or Section 18 of the Securities Exchanges Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of those sections, and shall not be part of any registration statement to which it may relate, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act or the Exchange Act, except as set forth by specific reference in such filing or document.

(4) Management contract or compensatory plan or arrangement.

(5) The following materials from this Quarterly Report on Form 10-Q for the period ended March 31, ~~2021~~2022 are formatted in Inline XBRL (Extensible Business Reporting Language): (i) Unaudited Condensed Consolidated Balance Sheets of the Company; (ii) Unaudited Condensed Consolidated Statements of Operations of the Company; (iii) Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) of the Company; (iv) Unaudited Condensed Consolidated Statements of Changes in Equity of the Company; (v) Unaudited Condensed Consolidated Statements of Cash Flows of the Company; and (vi) Notes to Unaudited Condensed Consolidated Financial Statements of the Company, detailed tagged.

3637

Table of Contents

SIGNATURES

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


		~~Lexington Realty~~LXP Industrial Trust

Date:	May ~~7, 2021~~5, 2022	By:	/s/ T. Wilson Eglin
			T. Wilson Eglin
			Chief Executive Officer and President (principal executive officer)

Date:	May ~~7, 2021~~5, 2022	By:	/s/ Beth Boulerice
			Beth Boulerice
			Chief Financial Officer, Executive Vice President and Treasurer (principal financial officer)

3738


	March 31, 2021		December 31, 2020
	(unaudited)
Assets:
Real estate, at cost	$	3,523,641	$	3,514,564
Real estate - intangible assets	399,394		409,293
Investments in real estate under construction	88,374		75,906
Real estate, gross	4,011,409		3,999,763
Less: accumulated depreciation and amortization	891,448		884,465
Real estate, net	3,119,961		3,115,298
Assets held for sale	18,383		16,530
Right-of-use assets, net	30,500		31,423

Cash and cash equivalents	142,074		178,795
Restricted cash	28,101		626
Investments in non-consolidated entities	54,185		56,464
Deferred expenses, net	16,730		15,901

Rent receivable – current	2,954		2,899
Rent receivable – deferred	66,680		66,959
Other assets	10,665		8,331
Total assets	$	3,490,233	$	3,493,226

Liabilities and Equity:
Liabilities:
Mortgages and notes payable, net	$	131,849	$	136,529

Term loan payable, net	298,069		297,943
Senior notes payable, net	779,607		779,275

Trust preferred securities, net	127,520		127,495
Dividends payable	33,317		35,401
Liabilities held for sale	6		790
Operating lease liabilities	31,508		32,515
Accounts payable and other liabilities	45,018		55,208
Accrued interest payable	7,221		6,334
Deferred revenue - including below-market leases, net	16,680		17,264
Prepaid rent	14,112		13,335
Total liabilities	1,484,907		1,502,089

Commitments and contingencies	0		0
Equity:
Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares:
Series C Cumulative Convertible Preferred, liquidation preference $96,770; 1,935,400 shares issued and outstanding	94,016		94,016
Common shares, par value $0.0001 per share; authorized 400,000,000 shares, 277,614,856 and 277,152,450 shares issued and outstanding in 2021 and 2020, respectively	28		28
Additional paid-in-capital	3,193,023		3,196,315
Accumulated distributions in excess of net income	(1,292,051)		(1,301,726)
Accumulated other comprehensive loss	(12,617)		(17,963)
Total shareholders’ equity	1,982,399		1,970,670
Noncontrolling interests	22,927		20,467
Total equity	2,005,326		1,991,137
Total liabilities and equity	$	3,490,233	$	3,493,226


Three Months Ended March 31, 2020			Lexington Realty Trust Shareholders
	Total		Preferred Shares		Common Shares		Additional Paid-in-Capital		Accumulated Distributions in Excess of Net Income		Accumulated Other Comprehensive Loss		Noncontrolling Interests
Balance December 31, 2019	$	1,724,719	$	94,016	$	25	$	2,976,670	$	(1,363,676)	$	(1,928)	$	19,612
Issuance of partnership interest in real estate	421		—		—		—		—		—		421
Redemption of noncontrolling OP units for common shares	—		—		—		428		—		—		(428)
Issuance of common shares and deferred compensation amortization, net	18,931		—		1		18,930		—		—		—
Repurchase of common shares	(11,042)		—		—		(11,042)		—		—		—
Repurchase of common shares to settle tax obligations	(2,623)		—		—		(2,623)		—		—		—
Forfeiture of employee common shares	1		—		—		—		1		—		—
Dividends/distributions	(29,161)		—		—		—		(28,765)		—		(396)
Net income	18,420		—		—		—		18,154		—		266
Other comprehensive loss	(16,996)		—		—		—		—		(16,996)		—
Balance March 31, 2020	$	1,702,670	$	94,016	$	26	$	2,982,363	$	(1,374,286)	$	(18,924)	$	19,475


Property Type	Market	Acquisition/Completion Date	Initial Cost Basis		Primary Lease Expiration	Land		Building and Improvements		Lease in-place Value Intangible		Above (Below-) Market Lease Intangible, net
Industrial	Indianapolis, IN	January 2021	$	14,310	12/2024	$	1,208	$	12,052	$	1,035	$	15
Industrial	Indianapolis, IN	January 2021	14,120		8/2025	1,162		11,825		1,133		0
Industrial	Central Florida	January 2021	22,358		5/2031	1,416		19,910		1,032		0
Industrial	Columbus, OH	March 2021(1)	18,435		03/2024	2,800		15,635		0		0









			$	69,223		$	6,586	$	59,422	$	3,200	$	15


Project (% owned)	Market	Property Type	Estimated Sq. Ft.	Estimated Project Cost		GAAP Investment Balance as of 3/31/2021		Amount Funded as of 3/31/2021		Estimated Completion Date	% Leased as of 3/31/2021		Approximate Lease Term (Years)
Fairburn (87%)(1)	Atlanta, GA	Industrial	910,000	$	53,812	$	45,322	$	40,376	2Q 2021	0	%	TBD
KeHE Distributors, BTS (100%)	Phoenix, AZ	Industrial	468,182	72,000		31,165		26,301		3Q 2021	100	%	15
Ocala (80%)(1)	Central Florida	Industrial	1,085,280	80,900		11,887		7,682		1Q 2022	0	%	TBD
				$	206,712	$	88,374	$	74,359


	As of March 31, 2021				As of December 31, 2020
	Carrying Amount		Fair Value		Carrying Amount		Fair Value



Liabilities
Debt	$	1,337,045	$	1,345,226	$	1,341,242	$	1,368,151



2021 - remainder	$	201,837
2022	261,276
2023	262,314
2024	227,483
2025	200,079
Thereafter	1,115,668
Total	$	2,268,657


	Three Months Ended
	March 31, 2021		March 31, 2020
Weighted-average remaining lease term
Operating leases (years)	11.5		12.1
Weighted-average discount rate
Operating leases	4.1	%	4.1	%


	Operating Leases
2021 - remainder	$	3,511
2022	4,854
2023	4,999
2024	5,021
2025	5,021
2026	3,985
Thereafter	13,487
Total lease payments	$	40,878
Less: Imputed interest	(9,370)
Present value of operating lease liabilities	$	31,508






	Three Months Ended March 31, 2020
	Shares Sold	Net Proceeds
2020 ATM Issuances	1,559,714	$17,266


Market	Square Feet	Initial Capitalized Cost (millions)		Date Acquired/Completed	Approximate Lease Term (years)
Indianapolis, IN	149,072	$	14.3	January 2021	4
Indianapolis, IN	149,072	14.1		January 2021	6
Central Florida	222,134	22.4		January 2021	10
Columbus, OH	320,190	18.4		March 2021	3
	840,468	$	69.2