First Industrial 10-K 2008 FY Annual report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-K

þ	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended December 31, 2008
	or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from          to          .

Commission File Number333-21873

FIRST INDUSTRIAL, L.P.

(Exact name of Registrant as specified in its Charter)

Delaware	36-3924586
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
311 S. Wacker Drive, Suite 4000,	60606
Chicago, Illinois	(Zip Code)
(Address of principal executive offices)

(312) 344-4300

(Registrant’s telephone number, including area code)

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

None

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

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes o     No þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.  Yes o     No þ

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 þ     No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 ofRegulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of thisForm 10-K or any amendment to thisForm 10-K.  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” inRule 12b-2 of the Exchange Act. (Check One):

Large accelerated filer þ Accelerated filer o Non-accelerated filer o
(Do not check if a smaller reporting company) Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined inRule 12b-2 of the Exchange Act).  Yes o     No þ

FIRST INDUSTRIAL, L.P.

TABLE OF CONTENTS

			Page
PART I.
	Item 1.	Business		4
	Item 1A.	Risk Factors		7
	Item 1B.	Unresolved SEC Comments		15
	Item 2.	Properties		15
	Item 3.	Legal Proceedings		21
	Item 4.	Submission of Matters to a Vote of Security Holders		21
PART II.
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		21
	Item 6.	Selected Financial Data		22
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		23
	Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		42
	Item 8.	Financial Statements and Supplementary Data		42
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		42
	Item 9A.	Controls and Procedures		42
	Item 9B.	Other Information		43
PART III.
	Item 10.	Directors, Executive Officers and Corporate Governance		43
	Item 11.	Executive Compensation		43
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		43
	Item 13.	Certain Relationships and Related Transactions and Director Independence		43
	Item 14.	Principal Accountant Fees and Services		43
PART IV.
	Item 15.	Exhibits and Financial Statement Schedules		44
Signatures				S-20
EX-23
EX-31.1
EX-31.2
EX-32

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This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. 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 are including this statement for purposes of complying with those safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies and expectations of the Operating Partnership, are generally identifiable by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” or similar expressions. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse affect on our operations and future prospects include, but are not limited to, changes in: international, national, regional and local economic conditions generally and the real estate market specifically, legislative/regulatory changes (including changes to laws governing the taxation of real estate investment trusts), availability of financing, interest rates, competition, supply and demand for industrial properties in our current and proposed market areas, potential environmental liabilities, slippage in development orlease-up schedules, tenant credit risks,higher-than-expected costs and changes in general accounting principles, policies and guidelines applicable to real estate investment trusts and risks related to doing business internationally (including foreign currency exchange risks). These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Further information concerning the Operating Partnership and its business, including additional factors that could materially affect our financial results, is included in Item 1A, “Risk Factors” and in the Operating Partnership’s other filings with the Securities and Exchange Commission. Unless the context otherwise requires, the term the “Operating Partnership” refers to First Industrial, L.P. and the terms “we,” “us,” and “our” refer to First Industrial, L.P. and its controlled subsidiaries. We refer to our taxable REIT subsidiary, First Industrial Investment, Inc., as the “TRS.”

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PART I

THE COMPANY

Item 1.   Business

General

First Industrial, L.P. (the “Operating Partnership”) was organized as a limited partnership in the state of Delaware on November 23, 1993. The sole general partner is First Industrial Realty Trust, Inc. (the “Company”) which owns common units in the Operating Partnership (“Units”) representing an approximate 88.5% ownership interest at December 31, 2008. The Company also owns a preferred general partnership interest in the Operating Partnership represented by preferred units (“Preferred Units”) with an aggregate liquidation priority of $275.0 million. The Company is a real estate investment trust (“REIT”) as defined in the Internal Revenue Code of 1986 (the “Code”). The Company’s operations are conducted primarily through the Operating Partnership. The limited partners of the Operating Partnership owned, in the aggregate, approximately a 11.5% interest in the Operating Partnership at December 31, 2008.

The Operating Partnership is the sole member of several limited liability companies (the “L.L.C.s”) and the sole stockholder of the TRS, (together with the Operating Partnership and the L.L.C.s, the “Consolidated Operating Partnership”), the operating data of which is consolidated with that of the Operating Partnership as presented herein. We also hold at least a 99% limited partnership interest in First Industrial Financing Partnership, L.P. (the “Financing Partnership”), First Industrial Securities, L.P. (the “Securities Partnership”), First Industrial Mortgage Partnership, (the “Mortgage Partnership”), L.P. First Industrial Pennsylvania, L.P. (the “Pennsylvania Partnership”), First Industrial Harrisburg, L.P. (the “Harrisburg Partnership”), First Industrial Indianapolis, L.P. (the “Indianapolis Partnership”), TK-SV, LTD., and FI Development Services L.P. and wholly owned L.L.C.s (together, the “Other Real Estate Partnerships”). The Other Real Estate Partnerships’ operating data is presented herein on a combined basis, separate from that of the Consolidated Operating Partnership. The general partners of the Other Real Estate Partnerships are separate corporations, each with at least a .01% general partnership interest in the Other Real Estate Partnerships for which it acts as a general partner. Each general partner of the Other Real Estate Partnerships is a wholly-owned subsidiary of the Company.

The Operating Partnership or the TRS, through separate wholly-owned limited liability companies in which it is the sole member, also owns minority equity interests in, and provides various services to, seven joint ventures whose purpose is to invest in industrial properties (the “2003 Net Lease Joint Venture,” the “2005Development/Repositioning Joint Venture,” the “2005 Core Joint Venture,” the “2006 Net Lease Co-Investment Program,” the “2006 Land/Development Joint Venture,” the “2007 Canada Joint Venture,” and the “2007 Europe Joint Venture”; together the “Joint Ventures”). The Other Real Estate Partnerships and the Joint Ventures are accounted for under the equity method of accounting. One of the Joint Ventures, the 2007 Europe Joint Venture, does not own any properties and is inactive.

The operating data of the Joint Ventures is not consolidated with that of the Operating Partnership as presented herein.

As of December 31, 2008, we owned 658 in-service industrial properties, containing an aggregate of approximately 53.2 million square feet of gross leasable area (“GLA”). On a combined basis, as of December 31, 2008, the Other Real Estate Partnerships owned 70 in-service industrial properties, containing an aggregate of approximately 7.4 million square feet of GLA. Of the 70 industrial properties owned by the Other Real Estate Partnerships at December 31, 2008, 22 are held by the Financing Partnership, 17 are held by the Pennsylvania Partnership, 10 are held by the Securities Partnership, nine are held by the Mortgage Partnership, six are held by the Harrisburg Partnership, four are held by the Indianapolis Partnership, one is held by TK-SV, LTD. and one is held by FI Development Services, L.P. The Consolidated Operating Partnership’s and Other Real Estate Partnerships’ in-service properties include all properties other than developed, redeveloped and acquired properties that have not yet reached stabilized occupancy (generally defined as properties that are 90% leased).

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We utilize an operating approach which combines the effectiveness of decentralized, locally based property management, acquisition, sales and development functions with the cost efficiencies of centralized acquisition, sales and development support, capital markets expertise, asset management and financial control systems. At February 20, 2009, we had 340 employees, approximately 34.4% fewer than at February 20, 2008.

We maintain a website at www.firstindustrial.com. Information on this website shall not constitute part of thisForm 10-K. Copies of our annual report onForm 10-K, quarterly reports onForm 10-Q, current reports onForm 8-K and amendments to such reports are available without charge on our website as soon as reasonably practicable after such reports are filed with or furnished to the Securities and Exchange Commission (the “SEC”). In addition, our Corporate Governance Guidelines, Code of Business Conduct and Ethics, Audit Committee Charter, Compensation Committee Charter, Nominating/Corporate Governance Committee Charter, along with supplemental financial and operating information prepared by us, are all available without charge on our website or upon request to us. Amendments to, or waivers from, our Code of Business Conduct and Ethics that apply to our executive officers or directors will also be posted to our website. We also post or otherwise make available on our website from time to time other information that may be of interest to our investors. Please direct requests as follows:

First Industrial Realty Trust, Inc.
311 S. Wacker, Suite 4000
Chicago, IL 60606
Attention: Investor Relations

Business Objectives and Growth Plans

Our fundamental business objective is to maximize the total return to our partners through increases in per unit distributions and increases in the value of our properties and operations. Our long-term growth plans include the following elements:

•  Internal Growth.  We seek to grow internally by (i) increasing revenues by renewing or re-leasing spaces subject to expiring leases at higher rental levels; (ii) increasing occupancy levels at properties where vacancies exist and maintaining occupancy elsewhere; (iii) controlling and minimizing property operating and general and administrative expenses; (iv) renovating existing properties; and (v) increasing ancillary revenues from non-real estate sources.

•  External Growth.  We seek to grow externally through (i) additional joint venture investments; (ii) the development of industrial properties; (iii) the acquisition of portfolios of industrial properties, industrial property businesses or individual properties which meet our investment parameters and target markets; and (iv) the expansion of our properties.

Business Strategies

We utilize the following seven strategies in connection with the operation of our business:

•  Organization Strategy.  We implement our decentralized property operations strategy through the deployment of experienced regional management teams and local property managers. We provide acquisition, development and financing assistance, asset management oversight and financial reporting functions from our headquarters in Chicago, Illinois to support our regional operations. We believe the size of our portfolio enables us to realize operating efficiencies by spreading overhead among many properties and by negotiating purchasing discounts.

•  Market Strategy.  Our market strategy is to concentrate on the top industrial real estate markets in the United States and select industrial real estate markets in Canada. These markets have one or more of the following characteristics: (i) strong industrial real estate fundamentals, including increased industrial demand expectations; (ii) a history of and outlook for continued economic growth and industry diversity; and (iii) sufficient size to provide for ample transaction volume.

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•  LeasingandMarketing Strategy.  We have an operational management strategy designed to enhance tenant satisfaction and portfolio performance. We pursue an active leasing strategy, which includes broadly marketing available space, seeking to renew existing leases at higher rents per square foot and seeking leases which provide for the pass-through of property-related expenses to the tenant. We also have local and national marketing programs which focus on the business and real estate brokerage communities and national tenants.

•  Acquisition/Development Strategy.  Our acquisition/development strategy is to invest in properties and other assets with higher yield potential in the top industrial real estate markets in the United States and select industrial real estate markets in Canada.

•  Disposition Strategy.  We continuously evaluate local market conditions and property-related factors in all of our markets for purposes of identifying assets suitable for disposition.

•  Financing Strategy.  To finance acquisitions and developments, as market conditions permit, we utilize a portion of net sales proceeds from property sales, proceeds from mortgage financings, borrowings under our unsecured line of credit (the “Unsecured Line of Credit”) and proceeds from the issuance, when and as warranted, of additional debt and equity securities. We also continually evaluate joint venture arrangements as another source of capital. As of February 20, 2009, we had approximately $6.2 million available for additional borrowings under our Unsecured Line of Credit.

•  Liquidity Strategy.  We plan to enhance our liquidity through a combination of capital retention, mortgage financing and asset sales.

•  Retained Capital — We plan to retain capital by adjusting our distribution policy to make per Unit distributions equivalent to the per share distributions the Company is required to make to meet its minimum distribution requirements as a REIT. We will not pay distributions in April 2009 and may not pay distributions in future quarters in 2009 depending on the Company’s taxable income. If the Company is required to pay common stock dividends in 2009, we may elect to make distributions through some combination of cash, common Unitsand/or the Company’s common shares.

•  Mortgage Financing — In June 2009, we have $125.0 million of unsecured debt maturing, and in July 2009 we have approximately $5.0 million of secured mortgage debt maturing. We are in active discussions with various lenders regarding the origination of mortgage financing. The total loan proceeds are expected to be sufficient to meet these maturities. If we fail to timely retire our maturing debt, we will be in default under our Unsecured Line of Credit and our senior debt securities.

•  Asset Sales — We are in various stages of discussions with third parties for the sale of properties in the three months ended March 31, 2009, and plan to continue to market other properties for sale throughout 2009. If we are unable to sell properties on an advantageous basis, this may impair our liquidity and our ability to meet our financial covenants.

Recent Developments

During 2008, we acquired or placed in-service developments totaling 30 industrial properties and acquired several parcels of land for a total investment of approximately $397.9 million. We also sold 89 industrial properties and several parcels of land for a gross sales price of approximately $469.5 million. At December 31, 2008, we owned 658 in-service industrial properties containing approximately 53.2 million square feet of GLA.

During 2008, we repurchased and retired $36.6 million of our senior unsecured notes for a gain on early debt retirement of approximately $2.7 million.

On or after March 31, 2009, the Company’s Series F Preferred Stock is subject to a coupon rate reset. The coupon rate resets every quarter beginning March 31, 2009 at 2.375% plus the greater of i) the 30 Year U.S. Treasury rate, ii) the 10 Year U.S. Treasury rate oriii) 3-Month LIBOR. In October 2008, we entered into an interest rate swap agreement (the “Series F Agreement”) to mitigate the Company’s exposure to floating interest rates related to the forecasted reset rate of the Company’s Series F Preferred Stock. The

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Series F Agreement has a notional value of $50.0 million and is effective from April 1, 2009 through October 1, 2013. The Series F Agreement fixes the30-year U.S. Treasury rate at 5.2175%. We recorded $3.1 million in mark to market loss which is included in Mark to Market/Loss on Settlement of Interest Rate Protection Agreements in earnings for the year ended December 31, 2008.

During the three months ended December 31, 2008, the Compensation Committee of the Board of Directors approved a plan to reduce organizational and overhead costs. As a result of the plan we recorded as restructuring costs a pre-tax charge of $26.7 million to provide for employee severance and benefits ($24.8 million), costs associated with the termination of certain office leases ($1.2 million) and contract cancellation and other costs ($0.7 million) associated with implementing the restructuring plan for the year ended December 31, 2008.

Future Property Acquisitions, Developments and Property Sales

We and our Joint Ventures have acquisition and development programs through which we are engaged in identifying, negotiating and consummating portfolio and individual industrial property acquisitions and developments. As a result, we and our Joint Ventures, other than our 2007 Europe Joint Venture, are currently engaged in negotiations relating to the possible acquisition and development of certain industrial properties.

We and our Joint Ventures also sell properties based on market conditions and property related factors. As a result, we and our Joint Ventures, other than our 2007 Europe Joint Venture, are engaged in negotiations relating to the possible sales of certain industrial properties in our portfolio.

When evaluating potential industrial property acquisitions and developments, as well as potential industrial property sales, we will consider such factors as: (i) the geographic area and type of property; (ii) the location, construction quality, condition and design of the property; (iii) the potential for capital appreciation of the property; (iv) our ability to improve the property’s performance through renovation; (v) the terms of tenant leases, including the potential for rent increases; (vi) the potential for economic growth and the tax and regulatory environment of the area in which the property is located; (vii) the potential for expansion of the physical layout of the propertyand/or the number of sites; (viii) the occupancy and demand by tenants for properties of a similar type in the vicinity; and (ix) competition from existing properties and the potential for the construction of new properties in the area.

INDUSTRY

Industrial properties are typically used for the design, assembly, packaging, storage and distribution of goodsand/or the provision of services. As a result, the demand for industrial space in the United States is related to the level of economic output. Historically, occupancy rates for industrial property in the United States have been higher than office property. We believe that the higher occupancy rate in the industrial property sector is a result of theconstruction-on-demand nature of, and the comparatively short development time required for, industrial property. For the five years ended December 31, 2008, the national occupancy rate for industrial properties in the United States has ranged from 88.3%^* to 90.7%^*, with an occupancy rate of 88.7%^* at December 31, 2008.

Item 1A.   Risk Factors

Risk Factors

Our operations involve various risks that could adversely affect our financial condition, results of operations, cash flow, ability to pay distributions on our Units and the market value of our Units. These risks, among others contained in the Operating Partnership’s other filings with the SEC, include:

Recent disruptions in the financial markets could affect our ability to obtain financing and may negatively impact our liquidity, financial condition and operating results.

The capital and credit markets in the United States and other countries have recently experienced significant price volatility, dislocations and liquidity disruptions, which have caused market prices of many

 ^* Source: Torto Wheaton Research

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securities to fluctuate substantially and the spreads on prospective debt financings to widen considerably. These circumstances have materially impacted liquidity in the financial markets, making terms for certain financings less attractive, and in some cases have resulted in the unavailability of financing. A majority of our existing indebtedness was sold through capital markets transactions. We anticipate that the capital markets could be a source of refinancing of our existing indebtedness in the future, including our 5.25% Notes in the aggregate amount of $125.0 million due on June 15, 2009. This source of refinancing may not be available if capital markets volatility and disruption continues, which could have a material adverse effect on our liquidity. Furthermore, we could potentially lose access to our current available liquidity under our Unsecured Line of Credit if one or more participating lenders default on their investments. While the ultimate outcome of these market conditions cannot be predicted, they may have a material adverse effect on our liquidity and financial condition if our ability to borrow money under our Unsecured Line of Credit or to issue additional debt or equity securities to finance future acquisitions, developments and redevelopments and Joint Venture activities were to be impaired.

In addition, the recent capital and credit market price volatility will likely make the valuation of our properties and those of our unconsolidated joint ventures more difficult. There may be significant uncertainty in the valuation, or in the stability of the value, of our properties and those of our unconsolidated joint ventures, that could result in a substantial decrease in the value of our properties and those of our unconsolidated joint ventures. As a result, we may not be able to recover the carrying amount of our properties or our investments in Joint Ventures, which may require us to recognize an impairment loss in earnings.

Real estate investments’ value fluctuates depending on conditions in the general economy and the real estate business. These conditions may limit the Consolidated Operating Partnership’s revenues and available cash.

The factors that affect the value of our real estate and the revenues we derive from our properties include, among other things:

•  general economic conditions;

•  local, regional, national and international economic conditions and other events and occurrences that affect the markets in which we own properties;

•  local conditions such as oversupply or a reduction in demand in an area;

•  the attractiveness of the properties to tenants;

•  tenant defaults;

•  zoning or other regulatory restrictions;

•  competition from other available real estate;

•  our ability to provide adequate maintenance and insurance; and

•  increased operating costs, including insurance premiums and real estate taxes.

These factors may be amplified in light of the current economic crisis. Our investments in real estate assets are concentrated in the industrial sector, and the demand for industrial space in the United States is related to the level of economic output. Accordingly, reduced economic output may lead to lower occupancy rates for our properties. In addition, if any of our tenants experiences a downturn in its business that weakens its financial condition, delays lease commencement, fails to make rental payments when due, becomes insolvent or declares bankruptcy, the result could be a termination of the tenant’s lease, which could adversely affect our cash flow from operations.

Many real estate costs are fixed, even if income from properties decreases.

Our financial results depend on leasing space to tenants on terms favorable to us. Our income and funds available for distribution to our unitholders will decrease if a significant number of our tenants cannot pay

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their rent or we are unable to lease properties on favorable terms. In addition, if a tenant does not pay its rent, we might not be able to enforce our rights as landlord without delays and we might incur substantial legal costs. Costs associated with real estate investment, such as real estate taxes and maintenance costs, generally are not reduced when circumstances cause a reduction in income from the investment.

The Consolidated Operating Partnership may be unable to sell properties when appropriate because real estate investments are not as liquid as certain other types of assets.

Real estate investments generally cannot be sold quickly and, therefore, will tend to limit our ability to adjust our property portfolio promptly in response to changes in economic or other conditions. The inability to respond promptly to changes in the performance of our property portfolio could adversely affect our financial condition and ability to service debt and make distributions to our unitholders. In addition, like other companies qualifying as REITs under the Code, the Company must comply with the safe harbor rules relating to the number of properties disposed of in a year, their tax basis and the cost of improvements made to the properties, or meet other tests which enable a REIT to avoid punitive taxation on the sale of assets. Thus, our ability at any time to sell assets may be restricted.

The Consolidated Operating Partnership may be unable to sell or contribute properties on advantageous terms.

We have sold to third parties a significant number of properties in recent years and, as part of our business, we intend to continue to sell properties to third parties. Our ability to sell properties on advantageous terms depends on factors beyond our control, including competition from other sellers and the availability of attractive financing for potential buyers of our properties. If we are unable to sell properties on favorable terms or redeploy the proceeds of property sales in accordance with our business strategy, then our financial condition, results of operations, cash flow and ability to pay distributions on, and the market value of, our Units could be adversely affected.

We have also sold to our Joint Ventures a significant number of properties in recent years and, as part of our business, we intend to continue to sell or contribute properties to our Joint Ventures as opportunities arise. If we do not have sufficient properties available that meet the investment criteria of current or future Joint Ventures, or if the Joint Ventures have reduced or do not have access to capital on favorable terms, then such sales could be delayed or prevented, adversely affecting our financial condition, results of operations, cash flow and ability to pay distributions on, and the market value of, our Units.

The Consolidated Operating Partnership may be unable to complete development and re-development projects on advantageous terms.

As part of our business, we develop new and re-develop existing properties. In addition, we have sold to third parties or sold to our Joint Ventures a significant number of development and re-development properties in recent years, and we intend to continue to sell or contribute such properties to third parties or to sell such properties to our Joint Ventures as opportunities arise. The real estate development and re-development business involves significant risks that could adversely affect our financial condition, results of operations, cash flow and ability to pay distributions on, and the market value of our Units, which include:

•  we may not be able to obtain financing for development projects on favorable terms and complete construction on schedule or within budget, resulting in increased debt service expense and construction costs and delays in leasing the properties and generating cash flow;

•  we may not be able to obtain, or may experience delays in obtaining, all necessary zoning, land-use, building, occupancy and other governmental permits and authorizations;

•  the properties may perform below anticipated levels, producing cash flow below budgeted amounts and limiting our ability to sell such properties to third parties or to sell or contribute such properties to our Joint Ventures.

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The Consolidated Operating Partnership may be unable to renew leases or find other lessees.

We are subject to the risks that, upon expiration, leases may not be renewed, the space subject to such leases may not be relet or the terms of renewal or reletting, including the cost of required renovations, may be less favorable than expiring lease terms. If we were unable to promptly renew a significant number of expiring leases or to promptly relet the space covered by such leases, or if the rental rates upon renewal or reletting were significantly lower than the current rates, our financial condition, results of operation, cash flow and ability to pay distributions on, and the market value of our Units could be adversely affected. As of December 31, 2008, leases with respect to approximately 10.7 million, 8.2 million and 7.4 million square feet of GLA, representing 22%, 17% and 15% of GLA, expire in 2009, 2010 and 2011, respectively.

The Consolidated Operating Partnership may be unable to acquire properties on advantageous terms or acquisitions may not perform as the Consolidated Operating Partnership expects.

We acquire and intend to continue to acquire primarily industrial properties. The acquisition of properties entails various risks, including the risks that our investments may not perform as expected and that our cost estimates for bringing an acquired property up to market standards may prove inaccurate. Further, we face significant competition for attractive investment opportunities from other well-capitalized real estate investors, including both publicly-traded REITs and private investors. This competition increases as investments in real estate become attractive relative to other forms of investment. As a result of competition, we may be unable to acquire additional properties as we desire or the purchase price may be elevated. In addition, we expect to finance future acquisitions through a combination of borrowings under the Unsecured Line of Credit, proceeds from equity or debt offerings by us and proceeds from property sales, which may not be available and which could adversely affect our cash flow. Any of the above risks could adversely affect our financial condition, results of operations, cash flow and ability to pay distributions on, and the market value of, our Units.

The Consolidated Operating Partnership might fail to qualify or remain qualified as a REIT.

The Company intends to operate so as to qualify as a REIT under the Code. Although the Company believes that it is organized and will operate in a manner so as to qualify as a REIT, qualification as a REIT involves the satisfaction of numerous requirements, some of which must be met on a recurring basis. These requirements are established under highly technical and complex Code provisions of which there are only limited judicial or administrative interpretations and involve the determination of various factual matters and circumstances not entirely within our control.

If the Company were to fail to qualify as a REIT in any taxable year, it would be subject to federal income tax, including any applicable alternative minimum tax, on its taxable income at corporate rates. This could result in a discontinuation or substantial reduction in dividends to stockholders and in cash to pay interest and principal on debt securities that we issue. Unless entitled to relief under certain statutory provisions, the Company would be disqualified from electing treatment as a REIT for the four taxable years following the year during which it failed to qualify as a REIT.

Certain property transfers may generate prohibited transaction income, resulting in a penalty tax on the gain attributable to the transaction.

As part of our business, we sell properties to third parties or sell properties to our Joint Ventures as opportunities arise. Under the Code, a 100% penalty tax could be assessed on the gain resulting from sales of properties that are deemed to be prohibited transactions. The question of what constitutes a prohibited transaction is based on the facts and circumstances surrounding each transaction. The Internal Revenue Service (“IRS”) could contend that certain sales of properties by us are prohibited transactions. While we do not believe that the IRS would prevail in such a dispute, if the matter were successfully argued by the IRS, the 100% penalty tax could be assessed against the profits from these transactions. In addition, any income from a prohibited transaction may adversely affect the Company’s ability to satisfy the income tests for qualification as a REIT.

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The REIT distribution requirements may limit the Company’s ability to retain capital and require the Company to turn to external financing sources.

The Company could, in certain instances, have taxable income without sufficient cash to enable us to meet the distribution requirements of the REIT provisions of the Code. In that situation, the Company could be required to borrow funds or sell properties on adverse terms in order to meet those distribution requirements. In addition, because the Company must distribute to its stockholders at least 90% of the Company’s REIT taxable income each year, the Company’s ability to accumulate capital may be limited. Thus, to provide capital resources for our ongoing business, organic growth and future acquisitions, the Company may be more dependent on outside sources of financing, such as debt financing or issuances of additional capital stock, which may or may not be available on favorable terms. Additional debt financings may substantially increase our leverage and additional equity offerings may result in substantial dilution of unitholders’ interests.

Debt financing, the degree of leverage and rising interest rates could reduce the Consolidated Operating Partnership’s cash flow.

Where possible, we intend to continue to use leverage to increase the rate of return on our investments and to allow us to make more investments than we otherwise could. Our use of leverage presents an additional element of risk in the event that the cash flow from our properties is insufficient to meet both debt payment obligations and our distribution requirements of the REIT provisions of the Code. In addition, rising interest rates would reduce our cash flow by increasing the amount of interest due on our floating rate debt and on our fixed rate debt as it matures and is refinanced.

Failure to comply with covenants in our debt agreements could adversely affect our financial condition.

The terms of our agreements governing our Unsecured Line of Credit and other indebtedness require that we comply with a number of financial and other covenants, such as maintaining debt service coverage and leverage ratios and maintaining insurance coverage. Complying with such covenants may limit our operational flexibility. Moreover, our failure to comply with these covenants could cause a default under the applicable debt agreement even if we have satisfied our payment obligations. Upon the occurrence of an event of default, the lenders under our Unsecured Line of Credit will not be required to lend any additional amounts to us, and our outstanding senior debt securities as well as all outstanding borrowings under the Unsecured Line of Credit, together with accrued and unpaid interest and fees, could be accelerated and declared to be immediately due and payable. Furthermore, our Unsecured Line of Credit and senior debt securities contain certain cross-default provisions, which are triggered in the event that our other material indebtedness is in default. These cross-default provisions may require us to repay or restructure the Unsecured Line of Credit and the senior debt securities or other debt that is in default, which could adversely affect our financial condition, results of operations, cash flow and ability to pay dividends on, and the market price of, our stock. If repayment of any of our borrowings is accelerated, we cannot provide assurance that we will have sufficient assets to repay such indebtedness or that we would be able to borrow sufficient funds to refinance such indebtedness. Even if we are able to obtain new financing, it may not be on commercially reasonable terms, or terms that are acceptable to us.

Moreover, the provisions of credit agreements and other debt instruments are complex, and some are subject to varying interpretations. Breaches of these provisions may be identified or occur in the future, and such provisions may be interpreted by the lenders under our Unsecured Line of Credit or the trustee with respect to the senior debt securities in a manner that could impose material costs on us.

Cross-collateralization of mortgage loans could result in foreclosure on substantially all of the Consolidated Operating Partnership’s properties if the Consolidated Operating Partnership is unable to service its indebtedness.

If we decide to obtain additional debt financing in the future, we may do so through mortgages on any of our properties. These mortgages may be issued on a recourse, non-recourse or cross-collateralized basis.

11

Cross-collateralization makes all of the subject properties available to the lender in order to satisfy our debt. Holders of indebtedness that is so secured will have a claim against these properties. To the extent indebtedness is cross collateralized, lenders may seek to foreclose upon properties that are not the primary collateral for their loan, which may, in turn, result in acceleration of other indebtedness secured by properties. Foreclosure of properties would result in a loss of income and asset value to us, making it difficult for us to meet both debt payment obligations and the Company’s distribution requirements of the REIT provisions of the Code. As of December 31, 2008, none of our existing indebtedness was cross-collateralized.

The Consolidated Operating Partnership may have to make lump-sum payments on its existing indebtedness.

We are required to make the following lump-sum or “balloon” payments under the terms of some of our indebtedness, including:

•  $50.0 million aggregate principal amount of 7.750% Notes due 2032 (the “2032 Notes”)

•  $200.0 million aggregate principal amount of 7.600% Notes due 2028 (the “2028 Notes”)

•  Approximately $15.0 million aggregate principal amount of 7.150% Notes due 2027 (the “2027 Notes”)

•  Approximately $118.5 million aggregate principal amount of 5.950% Notes due 2017 (the “2017 II Notes”)

•  $100.0 million aggregate principal amount of 7.500% Notes due 2017 (the “2017 Notes”)

•  $195.0 million aggregate principal amount of 5.750% Notes due 2016 (the “2016 Notes”)

•  $125.0 million aggregate principal amount of 6.420% Notes due 2014 (the “2014 Notes”)

•  $200.0 million aggregate principal amount of 6.875% Notes due 2012 (the “2012 Notes”)

•  $200.0 million aggregate principal amount of 4.625% Notes due 2011 (the “2011 Exchangeable Notes”)

•  $200.0 million aggregate principal amount of 7.375% Notes due 2011(the “2011 Notes”)

•  $125.0 million aggregate principal amount of 5.250% Notes due 2009 (the “2009 Notes”)

•  a $500.0 million Unsecured Line of Credit under which we may borrow to finance the acquisition of additional properties and for other corporate purposes, including working capital.

The Unsecured Line of Credit provides for the repayment of principal in a lump-sum or “balloon” payment at maturity in 2012. Under the Unsecured Line of Credit, we have the right, subject to certain conditions, to increase the aggregate commitment by up to $200.0 million. The portion available in multiple currencies is $161.0 million. As of December 31, 2008, $443.3 million was outstanding under the Unsecured Line of Credit at a weighted average interest rate of 1.98%.

Our ability to make required payments of principal on outstanding indebtedness, whether at maturity or otherwise, may depend on our ability either to refinance the applicable indebtedness or to sell properties. We have no commitments to refinance the 2009 Notes, the 2011 Notes, the 2011 Exchangeable Notes, the 2012 Notes, the 2014 Notes, the 2016 Notes, the 2017 Notes, the 2017 II Notes, the 2027 Notes, the 2028 Notes, the 2032 Notes or the Unsecured Line of Credit. Some of our existing debt obligations, other than those discussed above, are secured by our properties, and therefore such obligations will permit the lender to foreclose on those properties in the event of a default.

There is no limitation on debt in the Consolidated Operating Partnership’s organizational documents.

As of December 31, 2008, our ratio of debt to our total market capitalization was 75.6%. We compute that percentage by calculating our total consolidated debt as a percentage of the aggregate market value of all outstanding shares of the Company’s common stock, assuming the exchange of all of limited partnership units for common stock, plus the aggregate stated value of all outstanding shares of preferred stock and total

12

consolidated debt. Our organizational documents do not contain any limitation on the amount or percentage of indebtedness we may incur. Accordingly, we could become more highly leveraged, resulting in an increase in debt service that could adversely affect our ability to make expected distributions to Unitholders and in an increased risk of default on our obligations.

Rising interest rates on the Consolidated Operating Partnership’s Unsecured Line of Credit could decrease the Consolidated Operating Partnership’s available cash.

Our Unsecured Line of Credit bears interest at a floating rate. As of December 31, 2008, our Unsecured Line of Credit had an outstanding balance of $443.3 million at a weighted average interest rate of 1.98%. Our Unsecured Line of Credit bears interest at the prime rate or at the LIBOR plus 0.75%, at our election. Based on an outstanding balance on our Unsecured Line of Credit as of December 31, 2008, a 10% increase in interest rates would increase interest expense by $0.8 million on an annual basis. Increases in the interest rate payable on balances outstanding under our Unsecured Line of Credit would decrease our cash available for distribution to unitholders.

Earnings and cash dividends, asset value and market interest rates affect the price of the Company’s common stock.

As a REIT, the market value of the Company’s common stock, in general, is based primarily upon the market’s perception of the Company’s growth potential and its current and potential future earnings and cash dividends. The market value of the Company’s common stock is based secondarily upon the market value of the Company’s underlying real estate assets. For this reason, shares of the Company’s common stock may trade at prices that are higher or lower than the Company’s net asset value per share. To the extent that the Company retains operating cash flow for investment purposes, working capital reserves, or other purposes, these retained funds, while increasing the value of the Company’s underlying assets, may not correspondingly increase the market price of the Company’s common stock. The Company’s failure to meet the market’s expectations with regard to future earnings and cash dividends likely would adversely affect the market price of the Company’s common stock. Further, the distribution yield on the common stock (as a percentage of the price of the common stock) relative to market interest rates may also influence the price of the Company’s common stock. An increase in market interest rates might lead prospective purchasers of the Company’s common stock to expect a higher distribution yield, which would adversely affect the market price of the Company’s common stock.

The Consolidated Operating Partnership may incur unanticipated costs and liabilities due to environmental problems.

Under various federal, state and local laws, ordinances and regulations, an owner or operator of real estate may be liable for the costs ofclean-up of certain conditions relating to the presence of hazardous or toxic materials on, in or emanating from a property, and any related damages to natural resources. Environmental laws often impose liability without regard to whether the owner or operator knew of, or was responsible for, the presence of hazardous or toxic materials. The presence of such materials, or the failure to address those conditions properly, may adversely affect the ability to rent or sell the property or to borrow using the property as collateral. Persons who dispose of or arrange for the disposal or treatment of hazardous or toxic materials may also be liable for the costs ofclean-up of such materials, or for related natural resource damages, at or from an off-site disposal or treatment facility, whether or not the facility is owned or operated by those persons. No assurance can be given that existing environmental assessments with respect to any of our properties reveal all environmental liabilities, that any prior owner or operator of any of the properties did not create any material environmental condition not known to us or that a material environmental condition does not otherwise exist as to any of our properties.

The Consolidated Operating Partnership’s insurance coverage does not include all potential losses.

We currently carry comprehensive insurance coverage including property, boiler & machinery, liability, fire, flood, terrorism, earthquake, extended coverage and rental loss as appropriate for the markets where each

13

of our properties and their business operations are located. The insurance coverage contains policy specifications and insured limits customarily carried for similar properties and business activities. We believe our properties are adequately insured. However, there are certain losses, including losses from earthquakes, hurricanes, floods, pollution, acts of war, acts of terrorism or riots, that are not generally insured against or that are not generally fully insured against because it is not deemed to be economically feasible or prudent to do so. If an uninsured loss or a loss in excess of insured limits occurs with respect to one or more of our properties, we could experience a significant loss of capital invested and potential revenues from these properties, and could potentially remain obligated under any recourse debt associated with the property.

The Consolidated Operating Partnership is subject to risks and liabilities in connection with its investments in properties through Joint Ventures.

As of December 31, 2008, seven of our Joint Ventures owned approximately 22.8 million square feet of properties. As of December 31, 2008, our investment in Joint Ventures was $16.3 million in the aggregate, and for the year ended December 31, 2008, our equity in loss of Joint Ventures was $33.2 million. Our organizational documents do not limit the amount of available funds that we may invest in Joint Ventures and we intend to continue to develop and acquire properties through Joint Ventures with other persons or entities when warranted by the circumstances. Joint venture investments, in general, involve certain risks, including:

•  co-members or joint venturers may share certain approval rights over major decisions;

•  co-members or joint venturers might fail to fund their share of any required capital commitments;

•  co-members or joint venturers might have economic or other business interests or goals that are inconsistent with our business interests or goals that would affect its ability to operate the property;

•  co-members or joint venturers may have the power to act contrary to our instructions, requests, policies or objectives, including our current policy with respect to maintaining our qualification as a real estate investment trust;

•  the joint venture agreements often restrict the transfer of a member’s or joint venturer’s interest or “buy-sell” or may otherwise restrict our ability to sell the interest when we desire or on advantageous terms;

•  disputes between us and our co-members or joint venturers may result in litigation or arbitration that would increase our expenses and prevent our officers and directors from focusing their time and effort on our business and subject the properties owned by the applicable joint venture to additional risk; and

•  we may in certain circumstances be liable for the actions of our co-members or joint venturers.

The occurrence of one or more of the events described above could adversely affect the Company’s financial condition, results of operations, cash flow and ability to pay dividends on, and the market price of, its common stock.

In addition, joint venture investments in real estate involve all of the risks related to the ownership, acquisition, development, sale and financing of real estate discussed in the risk factors above. To the extent the Company’s investments in Joint Ventures are adversely affected by such risks, the Company’s financial condition, results of operations, cash flow and ability to pay dividends on, and the market price of, its common stock could be adversely affected.

We are subject to risks associated with our international operations.

Under our market strategy, we plan to acquire and develop properties in Canada. Our international operations will be subject to risks inherent in doing business abroad, including:

•  exposure to the economic fluctuations in the locations in which we invest;

•  difficulties and costs associated with complying with a wide variety of complex laws, treaties and regulations;

14

•  revisions in tax treaties or other laws and regulations, including those governing the taxation of our international revenues;

•  obstacles to the repatriation of earnings and funds;

•  currency exchange rate fluctuations between the United States dollar and foreign currencies;

•  restrictions on the transfer of funds; and

•  national, regional and local political uncertainty.

We also have offices outside of the United States. Our ability to effectively establish, staff and manage these offices is subject to risks associated with employment practices, labor issues, and cultural factors that differ from those with which we are familiar. In addition, we may be subject to regulatory requirements and prohibitions that differ between jurisdictions. To the extent we expand our business globally, we may have difficulty anticipating and effectively managing these and other risks that our international operations may face, which may adversely affect our business outside the United States and our financial condition and results of operations.

Acquired properties may be located in new markets, where we may face risks associated with investing in an unfamiliar market.

When we acquire properties located outside of the United States, we may face risks associated with a lack of market knowledge or understanding of the local economy, forging new business relationships in the area and unfamiliarity with local government and permitting procedures. We work to mitigate such risks through extensive diligence and research and associations with experienced partners; however, there can be no guarantee that all such risks will be eliminated.

Potential fluctuations in exchange rates between the U.S. dollar and the currencies of the other countries in which we invest may adversely affect our results of operations and financial position.

Owning, operating and developing industrial property outside of the United States exposes the Company to the possibility of volatile movements in foreign exchange rates. Changes in foreign currencies can affect the operating results of international operations reported in U.S. dollars and the value of the foreign assets reported in U.S. dollars. The economic impact of foreign exchange rate movements is complex because such changes are often linked to variability in real growth, inflation, interest rates, governmental actions and other factors. A significant depreciation in the value of the currency of one or more countries where we have a significant investment may materially affect our results of operations.

Item 1B.   Unresolved SEC Comments

None.

Item 2.   Properties

General

At December 31, 2008, we owned 728 in-service industrial properties (658 of which were owned by the Consolidated Operating Partnership and 70 of which were owned by the Other Real Estate Partnerships) containing an aggregate of approximately 60.6 million square feet of GLA (53.2 million square feet of which comprised the properties owned by the Consolidated Operating Partnership and 7.4 million square feet of which comprised the properties owned by the Other Real Estate Partnerships) in 28 states in the United States and one province in Canada, with a diverse base of more than 1,800 tenants engaged in a wide variety of businesses, including manufacturing, retail, wholesale trade, distribution and professional services. The average annual rental per square foot on a portfolio basis for 2008, calculated at December 31, 2008, was $4.59. The properties are generally located in business parks that have convenient access to interstate highwaysand/or rail and air transportation. The weighted average age of our properties on a combined basis as of December 31, 2008 was approximately 20 years. We maintain insurance on our properties that we believe is adequate.

15

We classify our properties into five industrial categories: light industrial, bulk warehouse, R&D/flex, regional warehouse and manufacturing. While some properties may have characteristics which fall under more than one property type, we have used what we believe is the most dominant characteristic to categorize the property.

The following describes the different industrial categories:

•  Light industrial properties generally are of less than 100,000 square feet, have a ceiling height of16-21 feet, are comprised of 5% — 50% of office space, contain less than 50% of manufacturing space and have a land use ratio of 4:1. The land use ratio is the ratio of the total property area to the area occupied by the building.

•  Bulk warehouse buildings generally are of more than 100,000 square feet, have a ceiling height of at least 22 feet, are comprised of 5% — 15% of office space, contain less than 25% of manufacturing space and have a land use ratio of 2:1.

•  R&D/flex buildings generally are of less than 100,000 square feet, have a ceiling height of less than 16 feet, are comprised of 50% or more of office space, contain less than 25% of manufacturing space and have a land use ratio of 4:1.

•  Regional warehouses generally are of less than 100,000 square feet, have a ceiling height of at least 22 feet, are comprised of 5% — 15% of office space, contain less than 25% of manufacturing space and have a land use ratio of 2:1.

•  Manufacturing properties are a diverse category of buildings that generally have a ceiling height of 10 — 18 feet, are comprised of 5% — 15% of office space, contain at least 50% of manufacturing space and have a land use ratio of 4:1.

16

The following tables summarize certain information as of December 31, 2008, with respect to the in-service properties owned by the Consolidated Operating Partnership, each of which is wholly-owned.

Consolidated Operating Partnership
Property Summary

	Light Industrial				R&D/Flex				Bulk Warehouse				Regional Warehouse				Manufacturing
			Number of				Number of				Number of				Number of				Number of
Metropolitan Area	GLA		Properties		GLA		Properties		GLA		Properties		GLA		Properties		GLA		Properties
Atlanta, GA(a)		666,544		11		140,538		3		1,998,745		8		215,918		3		847,950		4
Baltimore, MD		704,502		12		87,415		3		383,135		3		—		—		171,000		1
Central PA(b)		146,990		2		—		—		1,162,000		2		—		—		—		—
Chicago, IL		647,364		11		174,841		3		2,063,521		11		172,851		4		421,000		2
Cincinnati, OH		654,389		8		—		—		1,103,830		4		51,070		1		—		—
Cleveland, OH		—		—		—		—		608,740		4		—		—		—		—
Columbus, OH(c)		217,612		2		—		—		2,733,541		8		—		—		—		—
Dallas, TX		2,221,217		41		454,963		18		2,035,363		17		677,433		10		128,478		1
Denver, CO		1,170,042		20		1,016,054		23		290,098		2		293,548		4		126,384		1
Detroit, MI		2,030,838		80		428,984		14		470,745		5		710,308		17		116,250		1
Houston, TX		289,407		6		111,111		5		2,041,527		12		355,793		5		—		—
Indianapolis, IN (d,e,f,g)		837,500		17		38,200		3		1,986,942		9		162,710		4		71,600		2
Inland Empire, CA		—		—		—		—		595,940		2		—		—		—		—
Los Angeles, CA		490,525		11		184,064		2		586,499		4		199,555		3		—		—
Miami, FL		—		—		—		—		—		—		228,726		5		—		—
Milwaukee, WI		238,567		5		—		—		1,237,609		5		90,089		1		—		—
Minneapolis/St. Paul, MN (h,i)		1,220,776		13		172,862		2		1,830,291		9		323,805		4		231,202		3
N. New Jersey		659,849		11		289,967		6		329,593		2		—		—		—		—
Nashville, TN		205,205		3		—		—		855,112		4		—		—		109,058		1
Philadelphia, PA		—		—		—		—		110,422		1		21,512		1		—		—
Phoenix, AZ(j)		38,560		1		—		—		328,526		2		436,615		6		—		—
S. New Jersey(k)		680,480		6		—		—		281,100		2		79,329		1		—		—
Salt Lake City, UT		583,301		34		146,937		6		279,179		1		—		—		—		—
San Diego, CA		196,025		7		—		—		—		—		69,985		2		—		—
Seattle, WA (l,m)		—		—		—		—		100,611		1		139,435		2		—		—
St. Louis, MO(n)		660,239		9		—		—		1,368,095		4		—		—		—		—
Tampa, FL(o)		234,679		7		486,930		23		209,500		1		—		—		—		—
Toronto, ON		57,540		1		—		—		897,954		3		—		—		—		—
Other(p)		597,547		5		—		—		1,651,456		9		—		—		—		—
Total		15,449,698		323		3,732,866		111		27,540,074		135		4,228,682		73		2,222,922		16

(a)	One property collateralizes a $2.5 million mortgage loan which matures on May 1, 2016.
(b)	One property collateralizes a $14.1 million mortgage loan which matures on December 1, 2010.
(c)	One property collateralizes a $4.8 million mortgage loan which matures on December 1, 2019.
(d)	Twelve properties collateralize a $0.5 million mortgage loan which matures on September 1, 2009.
(e)	One property collateralizes a $1.2 million mortgage loan which matures on January 1, 2013.
(f)	One property collateralizes a $2.3 million mortgage loan which matures on January 1, 2012.
(g)	One property collateralizes a $1.5 million mortgage loan which matures on June 1, 2014.
(h)	One property collateralizes a $4.9 million mortgage loan which matures on December 1, 2019.
(i)	One property collateralizes a $1.7 million mortgage loan which matures on September 30, 2024.
(j)	One property collateralizes a $4.3 million mortgage loan which matures on June 1, 2018.

17

(k)	One property collateralizes a $6.0 million mortgage loan which matures on March 1, 2011.
(l)	One property collateralizes a $2.4 million mortgage loan which matures on July 1, 2018.
(m)	One property collateralizes a $1.0 million mortgage loan which matures on July 1, 2018.
(n)	One property collateralizes a $13.5 million mortgage loan and a $11.5 million mortgage loan which both mature on January 1, 2014.
(o)	Six properties collateralize a $5.2 million mortgage loan which matures on July 1, 2009.
(p)	Properties are located in Wichita, KS, Grand Rapids, MI, Orlando, FL, Horn Lake, MS, Shreveport, LA, Kansas City, MO, San Antonio, TX, Birmingham, AL, Omaha, NE, Jefferson County, KY, Greenville, KY and Sumner, IA.

Consolidated Operating Partnership
In Service Property Summary Totals

	Totals
					Average			GLA as a%
			Number of		Occupancy at			of Total
Metropolitan Area	GLA		Properties		12/31/08			Portfolio
Atlanta, GA		3,869,695		29		91	%		7.3	%
Baltimore, MD		1,346,052		19		97	%		2.5	%
Central PA		1,308,990		4		99	%		2.5	%
Chicago, IL		3,479,577		31		87	%		6.6	%
Cincinnati, OH		1,809,289		13		93	%		3.4	%
Cleveland, OH		608,740		4		95	%		1.2	%
Columbus, OH		2,951,153		10		83	%		5.5	%
Dallas, TX		5,517,454		87		91	%		10.4	%
Denver, CO		2,896,126		50		91	%		5.4	%
Detroit, MI		3,757,125		117		92	%		7.1	%
Houston, TX		2,797,838		28		99	%		5.3	%
Indianapolis, IN		3,096,952		35		93	%		5.8	%
Inland Empire, CA		595,940		2		0	%		1.1	%
Los Angeles, CA		1,460,643		20		98	%		2.7	%
Miami, FL		228,726		5		67	%		0.4	%
Milwaukee, WI		1,566,265		11		94	%		2.9	%
Minneapolis/St. Paul, MN		3,778,936		31		92	%		7.1	%
N. New Jersey		1,279,409		19		93	%		2.4	%
Nashville, TN		1,169,375		8		97	%		2.2	%
Philadelphia, PA		131,934		2		100	%		0.2	%
Phoenix, AZ		803,701		9		65	%		1.5	%
S. New Jersey		1,040,909		9		83	%		2.0	%
Salt Lake City, UT		1,009,417		41		90	%		1.9	%
San Diego, CA		266,010		9		97	%		0.5	%
Seattle, WA		240,046		3		100	%		0.5	%
St. Louis, MO		2,028,334		13		98	%		3.8	%
Tampa, FL		931,109		31		83	%		1.8	%
Toronto, ON		955,494		4		100	%		1.8	%
Other(a)		2,249,003		14		100	%		4.2	%
Total or Average		53,174,242		658		91	%		100	%

18

(a) Properties are located in Wichita, KS, Grand Rapids, MI, Orlando, FL, Horn Lake, MS, Shreveport, LA, Kansas City, MO, San Antonio, TX, Birmingham, AL, Omaha, NE, Jefferson County, KY, Greenville, KY and Sumner, IA.

Property Acquisition Activity

During 2008, we acquired 23 industrial properties totaling approximately 2.9 million square feet of GLA at a total purchase price of approximately $193.8 million, or approximately $66.83 per square foot. We also purchased several land parcels for an aggregate purchase price of approximately $102.0 million. The 23 industrial properties acquired have the following characteristics:

						Average
	Number of					Occupancy
Metropolitan Area	Properties		GLA		Property Type	at 12/31/2008
Atlanta, GA		1		80,000	Regional Warehouse		58	%
Chicago, IL		3		339,615	Bulk/Regional Warehouse		100	%
Cleveland, OH		1		257,000	Bulk Warehouse		28	%
Dallas, TX		1		220,542	Bulk Warehouse		100	%
Inland Empire, CA		2		271,895	Lt. Ind./Bulk Warehouse		19	%
Los Angeles, CA		3		207,304	Lt. Ind./R&D/Flex		100	%
Minneapolis, MN		1		165,360	Bulk Warehouse		100	%
Philadelphia, PA		1		110,422	Bulk Warehouse		100	%
Phoenix, AZ		5		616,077	Bulk/Regional Warehouse		41	%
Seattle, WA		3		240,046	Bulk/Regional Warehouse		100	%
St. Louis, MO		1		22,411	Light Industrial		100	%
Other(a)		1		332,465	Bulk Warehouse		100	%
Total		23		2,863,137

(a) Property is located in Greenville, KY.

Property Development Activity

During 2008, we placed in-service seven developments totaling approximately 2.2 million square feet of GLA at a total cost of approximately $102.1 million, or approximately $46.41 per square foot. The developments placed in-service have the following characteristics:

					Average
					Occupancy
Metropolitan Area	GLA		Property Type		at 12/31/08
Miami, FL(a)		24,506		Light Industrial		N/A
Milwaukee, WI		600,000		Bulk Warehouse		100	%
Nashville, TN(a)		294,000		Bulk Warehouse		N/A
Nashville, TN(a)		50,000		Light Industrial		N/A
Nashville, TN		145,450		Bulk Warehouse		100	%
Philadelphia, PA		675,000		Bulk Warehouse		100	%
St. Louis, MO		400,828		Bulk Warehouse		100	%
Total		2,189,784

(a) Property was sold in 2008.

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At December 31, 2008, we had 13 development projects not placed in service, totaling an estimated 4.1 million square feet and with an estimated completion cost of approximately $224.2 million. There can be no assurance that we will place these projects in service in 2009 or that the actual completion cost will not exceed the estimated completion cost stated above.

Property Sales

During 2008, we sold 89 industrial properties totaling approximately 7.4 million square feet of GLA and several land parcels. Total gross sales proceeds approximated $469.5 million. The 89 industrial properties sold have the following characteristics:

	Number of
Metropolitan Area	Properties		GLA		Property Type
Atlanta, GA		2		117,706	Lt. Ind./Regional Warehouse
Baltimore, MD		2		132,228	Light Industrial
Chicago, IL		5		416,221	Lt. Ind./Bulk Warehouse
Cincinnati, OH		3		421,300	Bulk Warehouse
Dallas, TX		9		353,312	Lt. Ind./Bulk Warehouse
Denver, CO		9		1,256,313	Lt. Ind./Bulk/Regional Warehouse
Houston, TX		6		363,662	Lt. Ind./R&D/Flex/Bulk Warehouse
Indianapolis, IN		2		249,353	Lt. Ind./Bulk Warehouse
Los Angeles, CA		2		93,743	Lt. Ind./Regional Warehouse
Milwaukee, WI		2		125,000	Lt. Ind./Bulk Warehouse
Minneapolis/St. Paul, MN		11		908,388	Manufact./Lt. Ind./R&D/Flex/Bulk Whse
N. New Jersey		9		599,312	Lt. Ind./R&D/Flex/Bulk/Regional Whse
Nashville, TN		1		50,000	Light Industrial
Phoenix, AZ		1		22,978	Light Industrial
S. New Jersey		15		692,032	Manufacturing/Lt. Ind./Regional Whse
Salt Lake City, UT		2		249,302	Bulk Warehouse
St. Louis, MO		3		371,087	Bulk/Regional Warehouse
Tampa, FL		1		18,445	R&D/Flex
Other(a)		4		964,100	Manufacturing/Bulk Warehouse
Total		89		7,404,482

(a) Properties are located in Kansas City, MO, Corinth, MS, Johnson County, KS and Portland, OR.

Property Acquisitions, Developments and Sales Subsequent to Year End

From January 1, 2009 to February 20, 2009, we acquired one land parcel for a total estimated investment of approximately $0.2 million. There were no industrial properties sold during this period.

Tenant and Lease Information

We have a diverse base of more than 1,800 tenants engaged in a wide variety of businesses including manufacturing, retail, wholesale trade, distribution and professional services. Most leases have an initial term of between three and six years and provide for periodic rent increases that are either fixed or based on changes in the Consumer Price Index. Industrial tenants typically have net orsemi-net leases and pay as additional rent their percentage of the property’s operating costs, including the costs of common area maintenance, property taxes and insurance. As of December 31, 2008, approximately 91% of the GLA of our in-service properties was leased, and no single tenant or group of related tenants accounted for more than 2.6% of the Consolidated Operating Partnerships’ and Other Real Estate Partnerships’ combined rent revenues, nor did any single tenant

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or group of related tenants occupy more than 2.5% of the Consolidated Operating Partnership’s and Other Real Estate Partnership’s combined total GLA of our in-service properties as of December 31, 2008.

The following table shows scheduled lease expirations for all leases for our in service properties as of December 31, 2008.

	Number of				Percentage of			Annual Base Rent		Percentage of Total
	Leases		GLA		GLA			Under Expiring		Annual Base Rent
Year of Expiration(1)	Expiring		Expiring(2)		Expiring(2)			Leases		Expiring
								(In thousands)
2009		505		10,691,007		22	%		46,414		21	%
2010		429		8,193,655		17	%		40,087		18	%
2011		335		7,382,561		15	%		36,707		16	%
2012		206		4,904,719		10	%		23,828		11	%
2013		170		4,809,132		10	%		25,131		11	%
2014		59		2,438,560		5	%		10,578		5	%
2015		39		2,018,728		4	%		7,205		3	%
2016		24		1,808,892		4	%		7,260		3	%
2017		8		689,491		2	%		3,464		2	%
2018		19		993,933		2	%		3,870		2	%
Thereafter		24		4,445,060		9	%		17,723		8	%
Total		1,818		48,375,738		100	%	$	222,267		100	%

(1)	Lease expirations as of December 31, 2008 assume tenants do not exercise existing renewal, termination or purchase options.
(2)	Does not include existing vacancies of 4,798,504 aggregate square feet.

Item 3.   Legal Proceedings

We are involved in legal proceedings arising in the ordinary course of business. All such proceedings, taken together, are not expected to have a material impact on our results of operations, financial position or liquidity.

Item 4.   Submission of Matters to a Vote of Security Holders

None.

PART II

Item 5.   Market for Registrant’s Partners’ Capital, Related Partner Matters and Issuer Purchases of Equity Securities

There is no established public trading market for the general partner and limited partner Units. As of February 20, 2009, there were 211 holders of record of general partner and limited partner Units.

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The following table sets forth the distributions per Unit paid or declared by us during the periods noted:

	Distribution
Quarter Ended	Declared
December 31, 2008	$	0.25
September 30, 2008	$	0.72
June 30, 2008	$	0.72
March 31, 2008	$	0.72
December 31, 2007	$	0.72
September 30, 2007	$	0.71
June 30, 2007	$	0.71
March 31, 2007	$	0.71

Our ability to make distributions depends on a number of factors, including our net cash provided by operating activities, capital commitments and debt repayment schedules. Holders of general partner and limited partner Units are entitled to receive distributions when, as and if declared by the Board of Directors of the Company, our general partner, after the priority distributions required under our partnership agreement have been made with respect to Preferred Units out of any funds legally available for that purpose. For 2009, we intend to make per Unit distributions equivalent to the per share distributions the Company is required to make to meet its minimum distribution requirements as a REIT.

During 2008, the Operating Partnership did not issue any Units.

Subject tolock-up periods and certain adjustments, Units of the Operating Partnership are convertible into common stock of the Company on aone-for-one basis or cash at the option of the Company. Prior requests for conversion have generally been fulfilled with shares of common stock of the Company and we intend to continue this practice. If each Unit of the Operating Partnership were converted as of December 31, 2008, the Company could satisfy its conversion obligation by making an aggregate cash payment of $43.8 million or by issuing 5,806,203 shares of our common stock.

Item 6.   Selected Financial Data

The following sets forth selected financial and operating data for the Consolidated Operating Partnership on a historical consolidated basis. The following data should be read in conjunction with the Consolidated Financial Statements and Notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in thisForm 10-K. The historical statements of operations for the years ended December 31, 2008, 2007, 2006, 2005 and 2004 include our results of operations as derived from our audited financial statements, adjusted for discontinued operations. The results of operations of properties sold are presented in discontinued operations if such properties met both of the following criteria: (a) the operations and cash flows of the property have been (or will be) eliminated from our ongoing operations as a result of the disposition and (b) we will not have any significant involvement in the operations of the property after the disposal transaction. The historical balance sheet data and other data as of December 31, 2008, 2007, 2006, 2005 and 2004 include our balances as derived from our audited financial statements.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	12/31/08			12/31/07			12/31/06			12/31/05			12/31/04
	(In thousands, except per unit and property data)
Statement of Operations Data:
Total Revenues	$	484,178		$	341,487		$	267,311		$	216,443		$	172,471
Interest Income		3,471			1,790			947			1,075			2,025
Mark-to-Market/(Loss) Gain on Settlement of Interest Rate Protection Agreement		(3,073	)		—			(3,112	)		811			1,583
Property Expenses		(111,457	)		(99,255	)		(88,504	)		(71,296	)		(57,865	)
General and Administrative Expense		(83,836	)		(92,005	)		(76,633	)		(54,846	)		(38,912	)
Restructuring Costs		(26,711	)		—			—			—			—
Interest Expense		(111,559	)		(119,314	)		(121,130	)		(108,164	)		(98,458	)
Amortization of Deferred Financing Costs		(2,879	)		(3,210	)		(2,664	)		(2,122	)		(1,928	)
Depreciation and Other Amortization		(144,285	)		(119,660	)		(100,053	)		(71,144	)		(51,665	)
Construction Expenses		(139,539	)		(34,553	)		(10,263	)		(15,574	)		—

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	Year Ended				Year Ended			Year Ended			Year Ended			Year Ended
	12/31/08				12/31/07			12/31/06			12/31/05			12/31/04
	(In thousands, except per unit and property data)
Gain (Loss) from Early Retirement of Debt		2,749				(393	)		—			82			(515	)
Equity in Income of Other Real Estate Partnerships		49,759				26,249			33,531			48,212			29,203
Equity in (Loss) Income of Joint Ventures		(33,178	)			29,958			30,671			3,698			35,840
Income Tax Benefit		12,259				10,661			9,937			14,343			8,195
Loss from Continuing Operations		(104,101	)			(58,245	)		(59,962	)		(38,482	)		(26	)
Income from Discontinued Operations (Including Gain on Sale of Real Estate of $136,384, $237,368, $196,622, $102,926, and $81,806 for the Years Ended December 31, 2008, 2007, 2006, 2005, and 2004, respectively)		145,358				265,453			233,011			143,787			126,702
Provision for Income Taxes Allocable to Discontinued Operations (Including $3,732, $36,032, $47,511, $20,529 and $8,659 allocable to Gain on Sale of Real Estate for the Years ended December 31, 2008, 2007, 2006, 2005, and 2004, respectively)		(4,188	)			(38,126	)		(51,155	)		(23,904	)		(11,275	)
Gain on Sale of Real Estate		12,061				7,879			6,195			28,686			15,112
Provision for Income Taxes Allocable to Gain on Sale of Real Estate		(3,782	)			(3,082	)		(2,119	)		(10,871	)		(5,359	)
Net Income		45,348				173,879			125,970			99,216			125,154
Preferred Unit Distributions		(19,428	)			(21,320	)		(21,424	)		(10,688	)		(14,488	)
Redemption of Preferred Units		—				(2,017	)		(672	)		—			(7,959	)
Net Income Available to Unitholders	$	25,920			$	150,542		$	103,874		$	88,528		$	102,707
Basic and Diluted Earnings Per Weighted Average Units Outstanding:
Loss from Continuing Operations Available to Unitholders	$	(2.33	)		$	(1.52	)	$	(1.54	)	$	(0.64	)	$	(0.27	)
Net Income Available to Unitholders	$	0.52			$	2.98		$	2.05		$	1.81		$	2.18
Distributions Per Unit	$	2.410			$	2.850		$	2.810		$	2.785		$	2.750
Basic and Diluted Weighted Average Number of Units Outstanding		49,456				50,597			50,703			48,968			47,136
Net Income	$	45,348			$	173,879		$	125,970		$	99,216		$	125,154
Other Comprehensive (Loss) Income:
Reclassification of Settlement of Interest Rate Protection Agreements to Net Income		—				—			—			(159	)		—
Mark-to-Market of Interest Rate Protection Agreements and Interest Rate Swap Agreements, Net of Tax		(8,676	)			3,819			(2,800	)		(1,414	)		106
Amortization of Interest Rate Protection Agreements		(792	)			(916	)		(912	)		(1,085	)		(512	)
Write-off of Unamortized Settlement Amounts of Interest Rate Protection Agreements		831				—			—			—			—
Settlement of Interest Rate Protection Agreements		—				(4,261	)		(1,729	)		—			6,816
Foreign Currency Translation Adjustment, Net of Tax		(2,748	)			2,134			—			—			—
Other Comprehensive Income	$	33,963			$	174,655		$	120,529		$	96,558		$	131,564
Balance Sheet Data (End of Period):				��
Real Estate, Before Accumulated Depreciation	$	3,014,530			$	2,913,267		$	2,826,588		$	2,896,937		$	2,486,414
Real Estate, After Accumulated Depreciation		2,559,228				2,476,755			2,424,091			2,541,182			2,165,411
Real Estate Held for Sale, Net		21,117				37,875			115,961			16,840			50,286
Investment in and Advances to Other Real Estate Partnerships		344,800				408,849			371,390			378,864			339,967
Total Assets		3,241,175				3,301,143			3,235,366			3,230,465			2,721,151
Mortgage Loans Payable, Net, Unsecured Lines of Credit and Senior Unsecured Debt, Net		2,036,978				1,946,670			1,834,658			1,811,322			1,572,473
Total Liabilities		2,245,507				2,218,940			2,051,706			2,016,827			1,711,429
Partners’ Capital		995,668				1,082,203			1,183,660			1,213,638			1,009,722
Other Data:
Cash Flow From Operating Activities	$	63,424			$	106,005		$	66,898		$	82,831		$	81,015
Cash Flow From Investing Activities		14,556				113,844			119,866			(404,742	)		5,570
Cash Flow From Financing Activities		(79,754	)			(230,277	)		(178,451	)		325,653			(83,516	)
Total In-Service Properties		658				711			764			786			726
Total In-Service GLA, in Square Feet		53,174,242				55,377,696			60,306,452			61,674,426			52,330,335
In-Service Occupancy Percentage		91	%			95	%		94	%		92	%		91	%

Item 7.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with “Selected Financial Data” and the Consolidated Financial Statements and Notes thereto appearing elsewhere in thisForm 10-K.

This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. 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 are including this statement for purposes of complying

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with those 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 “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” or similar expressions. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse affect on our operations and future prospects on a consolidated basis include, but are not limited to, changes in: international, national, regional and local economic conditions generally and the real estate market specifically, legislative/regulatory changes (including changes to laws governing the taxation of real estate investment trusts), availability of financing, interest rates, competition, supply and demand for industrial properties in our current and proposed market areas, potential environmental liabilities, slippage in development orlease-up schedules, tenant credit risks,higher-than-expected costs and changes in general accounting principles, policies and guidelines applicable to real estate investment trusts. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Further information concerning the Operating Partnership and our business, including additional factors that could materially affect our financial results, is included in Item 1A, “Risk Factors” and in the Operating Partnership’s other filings with the Securities and Exchange Commission (the “SEC”).

First Industrial, L.P. (the “Operating Partnership”) was organized as a limited partnership in the state of Delaware on November 23, 1993. The sole general partner is First Industrial Realty Trust, Inc. (the “Company”) which owns common units in the Operating Partnership (“Units”) representing an approximate 88.5% ownership interest at December 31, 2008. The Company also owns a preferred general partnership interest in the Operating Partnership (“Preferred Units”) with an aggregate liquidation priority of $275.0 million at December 31, 2008. The Company is a real estate investment trust (“REIT”) as defined in the Internal Revenue Code of 1986 (the “Code”). The Company’s operations are conducted primarily through the Operating Partnership. The limited partners of the Operating Partnership own, in the aggregate, approximately a 11.5% interest in the Operating Partnership at December 31, 2008.

The Operating Partnership is the sole stockholder of First Industrial Investment, Inc., a taxable REIT subsidiary (the “TRS”), and the Operating Partnership or the TRS is the sole member of several limited liability companies (the “L.L.C.s”, and, together with the Operating Partnership and the TRS, the “Consolidated Operating Partnership”), the operating data of which is consolidated with that of the Operating Partnership. We hold at least a 99% limited partnership interest in First Industrial Financing Partnership, L.P. (the “Financing Partnership”), First Industrial Securities, L.P. (the “Securities Partnership”), First Industrial Mortgage Partnership, L.P. (the “Mortgage Partnership”), First Industrial Pennsylvania, L.P. (the “Pennsylvania Partnership”), First Industrial Harrisburg, L.P. (the “Harrisburg Partnership”), First Industrial Indianapolis, L.P. (the “Indianapolis Partnership”), TK-SV, LTD., and FI Development Services, L.P. and wholly owned L.L.C.s (together, the “Other Real Estate Partnerships”). The Other Real Estate Partnerships’ operating data is presented on a combined basis, separate from that of the Consolidated Operating Partnership.

We also own minority equity interests in, and provide asset and property management services to, seven joint ventures whose purpose is to invest in industrial properties (the “2003 Net Lease Joint Venture,” the “2005 Development/Repositioning Joint Venture,” the “2005 Core Joint Venture,” the “2006 Net Lease Co-Investment Program,” the “2006 Land/Development Joint Venture”, the “2007 Canada Joint Venture,” and the “2007 Europe Joint Venture”; together the “Joint Ventures”). One of the Joint Ventures, the 2007 Europe Joint Venture, does not own any properties and is inactive.

The operating data of our Joint Ventures is not consolidated with that of the Operating Partnership as presented herein.

The general partners of the Other Real Estate Partnerships are separate corporations, each with at least a .01% general partnership interest in the Other Real Estate Partnerships for which it acts as a general partner. Each general partner of the Other Real Estate Partnerships is a wholly-owned subsidiary of the Company.

Our financial statements report the L.L.C.s and the TRS on a consolidated basis and the Other Real Estate Partnerships and the Joint Ventures are accounted for under the equity method of accounting. Profits, losses and distributions of the Operating Partnership, the L.L.C.s and the Other Real Estate Partnerships are allocated to the general partner and the limited partners, or members, as applicable, in accordance with the

24

provisions contained in the partnership agreements or operating agreements, as applicable, of the Operating Partnership, the L.L.C.s and the Other Real Estate Partnerships.

As of December 31, 2008, we owned 658 in-service industrial properties, containing an aggregate of approximately 53.2 million square feet of GLA. On a combined basis, as of December 31, 2008, the Other Real Estate Partnerships owned 70 in-service industrial properties, containing an aggregate of approximately 7.4 million square feet of GLA. Of the 70 industrial properties owned by the Other Real Estate Partnerships at December 31, 2008, 22 are held by the Financing Partnership, 17 are held by the Pennsylvania Partnership, 10 are held by the Securities Partnership, nine are held by the Mortgage Partnership, six are held by the Harrisburg Partnership, four are held by the Indianapolis Partnership, one is held by TK-SV, LTD and one is held by FI Development Services, L.P.

We believe our financial condition and results of operations are, primarily, a function of our performance and our Joint Ventures’ performance in four key areas: leasing of industrial properties, acquisition and development of additional industrial properties, redeployment of internal capital and access to external capital.

We generate revenue primarily from rental income and tenant recoveries from long-term (generally three to six years) operating leases of our industrial properties and our Joint Ventures’ industrial properties. Such revenue is offset by certain property specific operating expenses, such as real estate taxes, repairs and maintenance, property management, utilities and insurance expenses, along with certain other costs and expenses, such as depreciation and amortization costs and general and administrative and interest expenses. Our revenue growth is dependent, in part, on our ability to (i) increase rental income, through increasing either or both occupancy rates and rental rates at our and our Joint Ventures’ properties, (ii) maximize tenant recoveries and (iii) minimize operating and certain other expenses. Revenues generated from rental income and tenant recoveries are a significant source of funds, in addition to income generated from gains/losses on the sale of our properties and our Joint Ventures’ properties (as discussed below), for our distributions. The leasing of property, in general, and occupancy rates, rental rates, operating expenses and certain non-operating expenses, in particular, are impacted, variously, by property specific, market specific, general economic and other conditions, many of which are beyond our control. The leasing of property also entails various risks, including the risk of tenant default. If we were unable to maintain or increase occupancy rates and rental rates at our properties and our Joint Ventures’ properties or to maintain tenant recoveries and operating and certain other expenses consistent with historical levels and proportions, our revenue growth would be limited. Further, if a significant number of our or our Joint Ventures’ tenants were unable to pay rent (including tenant recoveries) or if our or our Joint Ventures were unable to rent their properties on favorable terms, our financial condition, results of operations, cash flow and the Company’s ability to pay dividends on, and the market price of, the Company’s common stock would be adversely affected.

Our revenue growth is also dependent, in part, on our ability and our Joint Ventures’ ability to acquire existing, and acquire and develop new, additional industrial properties on favorable terms. The Consolidated Operating Partnership itself, and through our various Joint Ventures, continually seeks to acquire existing industrial properties on favorable terms, and, when conditions permit, also seeks to acquire and develop new industrial properties on favorable terms. Existing properties, as they are acquired, and acquired and developed properties, as they are leased, generate revenue from rental income, tenant recoveries and fees, income from which, as discussed above, is a source of funds our distributions. The acquisition and development of properties is impacted, variously, by property specific, market specific, general economic and other conditions, many of which are beyond our control. The acquisition and development of properties also entails various risks, including the risk that our investments and our Joint Ventures’ investments may not perform as expected. For example, acquired existing and acquired and developed new properties may not sustainand/or achieve anticipated occupancy and rental rate levels. With respect to acquired and developed new properties, we may not be able to complete construction on schedule or within budget, resulting in increased debt service expense and construction costs and delays in leasing the properties. Also, we face significant competition for attractive acquisition and development opportunities from other well-capitalized real estate investors, including both publicly-traded REITs and private investors. Further, as discussed below, we may not be able to finance the acquisition and development opportunities we identify. If we were unable to acquire and develop sufficient additional properties on favorable terms or if such investments did not perform as expected, our revenue

25

growth would be limited and our financial condition, results of operations, cash flow and the Company’s ability to pay dividends on, and the market price of, the Company’s common stock would be adversely affected.

We also generate income from the sale of our properties and our Joint Ventures’ properties (including existing buildings, buildings which the we or our Joint Ventures have developed or re-developed on a merchant basis and land). The Consolidated Operating Partnership itself, and through our various Joint Ventures, is continually engaged in, and our income growth is dependent, in part, on systematically redeploying capital from properties and other assets with lower yield potential into properties and other assets with higher yield potential. As part of that process, we sell, on an ongoing basis, select properties or land. The gain/loss on, and fees from, the sale of such properties are included in our income and are a significant source of funds, in addition to revenues generated from rental income and tenant recoveries, for our distributions. Also, a significant portion of our proceeds from such sales is used to fund the acquisition of existing, and the acquisition and development of new, industrial properties. The sale of properties is impacted, variously, by property specific, market specific, general economic and other conditions, many of which are beyond our control. The sale of properties also entails various risks, including competition from other sellers and the availability of attractive financing for potential buyers of our properties. Further, our ability to sell properties is limited by safe harbor rules applying to REITs under the Code which relate to the number of properties that may be disposed of in a year, their tax bases and the cost of improvements made to the properties, along with other tests which enable a REIT to avoid punitive taxation on the sale of assets. If we were unable to sell properties on favorable terms, our income growth would be limited and our financial condition, results of operations, cash flow and the Company’s ability to pay dividends on, and the market price of, the Company’s common stock would be adversely affected.

We utilize a portion of the net sales proceeds from property sales, borrowings under its unsecured line of credit (the “Unsecured Line of Credit”) and proceeds from the issuance, when and as warranted, of additional debt and equity securities to finance future acquisitions and developments, and to fund our equity commitments to our Joint Ventures. Access to external capital on favorable terms plays a key role in our financial condition and results of operations, as it impacts our cost of capital and our ability and cost to refinance existing indebtedness as it matures and to fund acquisitions, developments and contributions to our Joint Ventures or through the issuance, when and as warranted, of additional equity securities. Our ability to access external capital on favorable terms is dependent on various factors, including general market conditions, interest rates, credit ratings on our capital stock and debt, the market’s perception of our growth potential, our current and potential future earnings and cash distributions and the market price of the Company’s capital stock. If we were unable to access external capital on favorable terms, our financial condition, results of operations, cash flow and the Company’s ability to pay dividends on, and the market price of, the Company’s common stock would be adversely affected.

Current Business Risks and Uncertainties

The real estate markets have been significantly impacted by the continued deterioration of the global credit markets. The current recession has resulted in downward pressure on our net operating income and has impaired our ability to sell properties.

Our Unsecured Line of Credit and the indentures under which our senior unsecured indebtedness is, or may be, issued contain certain financial covenants, including, among other things, debt service coverage and fixed charge coverage ratios, as well as limitations on our ability to incur secured and unsecured indebtedness. Consistent with our prior practice, we will, in the future, continue to interpret and certify our performance under these covenants in a good faith manner that we deem reasonable and appropriate. However, these financial covenants are complex and there can be no assurance that these provisions would not be interpreted by our lenders in a manner that could impose and cause us to incur material costs. Any violation of these covenants would subject us to higher finance costs and fees, or accelerated maturities. In addition, our credit facilities and senior debt securities contain certain cross-default provisions, which are triggered in the event that our other material indebtedness is in default. Under the Unsecured Line of Credit, an event of default can also occur if the lenders, in their good faith judgment, determine that a material adverse change has occurred

26

which could prevent timely repayment or materially impair our ability to perform our obligations under the loan agreement.

We believe that we were in compliance with our financial covenants as of December 31, 2008, and we anticipate that we will be able to operate in compliance with our financial covenants in 2009. However, our ability to meet our financial covenants may be reduced if 2009 economic and credit market conditions limit our property sales and reduce our net operating income below our projections. We expect to refinance indebtedness maturing in 2009 and to comply with our financial covenants in 2009 and beyond. We plan to enhance our liquidity through a combination of capital retention, mortgage financing and asset sales.

•  Retained Capital— We plan to retain capital by adjusting our distribution policy to make per Unit distributions equivalent to the per share distributions the Company is required to make to meet its minimum distribution requirements as a REIT. We will not pay distributions in April 2009 and may not pay distributions in future quarters in 2009 depending on the Company’s taxable income. If the Company is required to pay common stock dividends in 2009, we may elect to make distributions through some combination of cash, common Unitsand/or the Company’s common shares.

•  Mortgage Financing— In June 2009, we have $125.0 million of unsecured debt maturing, and in July 2009 we have $5.0 million of secured mortgage debt maturing. We are in active discussions with various lenders regarding the origination of mortgage financing. The total loan proceeds are expected to be sufficient to meet these maturities. No assurances can be made that new secured financing will be obtained. If we fail to timely retire our maturing debt, we will be in default under our Unsecured Line of Credit and our senior unsecured debt securities.

•  Asset Sales— We are in various stages of discussions with third parties for the sale of properties during the three months ended March 31, 2009, and plan to continue to market other properties for sale throughout 2009. If we are unable to sell properties on an advantageous basis, this may impair our liquidity and our ability to meet our financial covenants.

In addition, we may from time to time repurchase or redeem our outstanding securities. Any repurchases or redemptions would depend upon prevailing market conditions, our liquidity requirements, contractual restrictions and other factors we consider important. Future repurchases or redemptions may materially impact our liquidity, future tax liability and results of operations.

Although we believe we will be successful in meeting our liquidity needs though a combination of capital retention, mortgage financing and asset sales, if we were to be unsuccessful in executing one or more of the strategies outlined above, we would be materially adversely effected.

CRITICAL ACCOUNTING POLICIES

Our significant accounting policies are described in more detail in Note 4 to the consolidated financial statements. We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements.

•  We maintain an allowance for doubtful accounts which is based on estimates of potential losses which could result from the inability of our tenants to satisfy outstanding billings with us. The allowance for doubtful accounts is an estimate based on our assessment of the creditworthiness of our tenants.

•  Properties are classified as held for sale when all criteria within Financial Accounting Standards Board’s (the “FASB”) Statement of Financial Accounting Standards (“SFAS”) No. 144,“Accounting for the Impairment or Disposal of Long Lived Assets”(“SFAS 144”) are met for such properties. When properties are classified as held for sale, we cease depreciating the properties and estimate the values of such properties and measure them at the lower of depreciated cost or fair value, less costs to dispose. If circumstances arise that were previously considered unlikely, and, as a result, we decide not to sell a property previously classified as held for sale, we will reclassify such property as held and used. We estimate the value of such property and measure it at the lower of its carrying amount (adjusted for any depreciation and amortization expense that would have been recognized had the property been

27

continuously classified as held and used) or fair value at the date of the subsequent decision not to sell. Fair value is determined by deducting from the estimated sales price of the property the estimated costs to close the sale.

•  We review our properties on a periodic basis for possible impairment and provide a provision if impairments are determined. We utilize the guidelines established under SFAS 144 to determine if impairment conditions exist. We review the expected undiscounted cash flows of each property to determine if there are any indications of impairment. If the expected undiscounted cash flows of a particular property are less than the net book basis of the property, we will recognize an impairment charge equal to the amount of carrying value of the property that exceeds the fair value of the property. Fair value is determined by discounting the future expected cash flows of the property. The calculation of the fair value involves subjective assumptions such as estimated occupancy, rental rates, ultimate residual value and the discount rate used to present value the cash flows.

•  We analyze our investments in Joint Ventures to determine whether the joint venture should be accounted for under the equity method of accounting or consolidated into our financial statements based on standards set forth under SFAS Interpretation No. 46(R),Consolidation of Variable Interest Entities,EITF 96-16,Investor’s Accounting for an Investee When the Investor Has a Majority of the Voting Interest but the Minority Shareholder or Shareholders Have Certain Approval or Veto Rightsand Statement of Position78-9,Accounting for Investments in Real Estate Ventures.Based on the guidance set forth in these pronouncements, we do not consolidate any of our joint venture investments because either the joint venture has been determined to be a variable interest entity but we are not the primary beneficiary or the joint venture has been determined not to be a variable interest entity and we lack control of the joint venture. Our assessment of whether we are the primary beneficiary of a variable interest involves the consideration of various factors including the form of our ownership interest, our representation on the entity’s governing body, the size of our investment and future cash flows of the entity.

•  On a periodic basis, we assess whether there are any indicators that the value of our investments in Joint Ventures may be impaired in accordance with APB Opinion No. 18,“The Equity Method of Accounting for Investments in Common Stock”(“APB 18”). An investment is impaired only if our estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the fair value of the investment. Our estimates of fair value for each investment are based on a number of subjective assumptions that are subject to economic and market uncertainties including, among others, demand for space, market rental rates and operating costs, the discount rate used to value the cash flows of the properties and the discount rate used to value the Joint Ventures’ debt.

•  We capitalize (direct and certain indirect) costs incurred in developing, renovating, acquiring and rehabilitating real estate assets as part of the investment basis. Costs incurred in making certain other improvements are also capitalized. During the land development and construction periods, we capitalize interest costs, real estate taxes and certain general and administrative costs of the personnel performing development, renovations or rehabilitation up to the time the property is substantially complete. The determination and calculation of certain costs requires estimates by us. Amounts included in capitalized costs are included in the investment basis of real estate assets.

•  We are engaged in the acquisition of individual properties as well as multi-property portfolios. In accordance with SFAS No. 141,“Business Combinations”(“SFAS 141”), we are required to allocate purchase price between land, building, tenant improvements, leasing commissions, in-place leases, tenant relationships and above and below market leases. Above-market and below-market lease values for acquired properties are recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) our estimate of fair market lease rents for each corresponding in-place lease. Acquired above and below market leases are amortized over the remaining

28

non-cancelable terms of the respective leases as an adjustment to rental income. In-place lease and tenant relationship values for acquired properties are recorded based on our evaluation of the specific characteristics of each tenant’s lease and our overall relationship with the respective tenant. The value allocated to in-place lease intangible assets is amortized to depreciation and amortization expense over the remaining lease term of the respective lease. The value allocated to tenant relationship is amortized to depreciation and amortization expense over the expected term of the relationship, which includes an estimate of the probability of lease renewal and its estimated term. We also must allocate purchase price on multi-property portfolios to individual properties. The allocation of purchase price is based on our assessment of various characteristics of the markets where the property is located and the expected cash flows of the property.

•  In the preparation of our consolidated financial statements, significant management judgment is required to estimate our current and deferred income tax liabilities, and our compliance with REIT qualification requirements. Our estimates are based on our interpretation of tax laws. These estimates may have an impact on the income tax expense recognized. Adjustments may be required by a change in assessment of our deferred income tax assets and liabilities, changes due to audit adjustments by federal and state tax authorities, our inability to qualify as a REIT, and changes in tax laws. Adjustments required in any given period are included within the income tax provision.

In assessing the need for a valuation allowance against our deferred tax assets, we estimate future taxable income, considering the feasibility of ongoing tax planning strategies and the realizability of tax loss carryforwards. In the event we were to determine that we would not be able to realize all or a portion of our deferred tax assets in the future, we would reduce such amounts through a charge to income in the period in which that determination is made. Conversely, if we were to determine that we would be able to realize our deferred tax assets in the future in excess of the net carrying amounts, we would decrease the recorded valuation allowance through an increase to income in the period in which that determination is made.

RESULTS OF OPERATIONS

Comparison of Year Ended December 31, 2008 to Year Ended December 31, 2007

Our net income available to unitholders was $25.9 million and $150.5 million for the years ended December 31, 2008 and 2007, respectively. Basic and diluted net income available to unitholders were $0.52 per unit for the year ended December 31, 2008 and $2.98 per unit for the year ended December 31, 2007.

The tables below summarize our revenues, property expenses and depreciation and other amortization by various categories for the year ended December 31, 2008 and December 31, 2007. Same store properties are properties owned prior to January 1, 2007 and held as an operating property through December 31, 2008 and developments and redevelopments that were placed in service prior to January 1, 2007 or were substantially completed for the 12 months prior to January 1, 2007. Properties are placed in service as they reach stabilized occupancy (generally defined as 90% occupied). Acquired properties are properties that were acquired subsequent to December 31, 2006 and held as an operating property through December 31, 2008. Sold properties are properties that were sold subsequent to December 31, 2006. (Re)Developments and land are land parcels and developments and redevelopments that were not: a) substantially complete 12 months prior to January 1, 2007 or b) stabilized prior to January 1, 2007. Other revenues are derived from the operations of our maintenance company, fees earned from our Joint Ventures and other miscellaneous revenues. Construction revenues and expenses represent revenues earned and expenses incurred in connection with the TRS acting as general contractor or development manager to construct industrial properties, including industrial properties for the 2005 Development/Repositioning Joint Venture, and also include revenues and expenses related to the development of properties for third parties. Other expenses are derived from the operations of our maintenance company and other miscellaneous regional expenses.

Our future financial condition and results of operations, including rental revenues, may be impacted by the future acquisition and sale of properties. Our future revenues and expenses may vary materially from historical rates.

29

For the years ended December 31, 2008 and December 31, 2007, the occupancy rates of our same store properties were 90.5% and 91.1%, respectively.

	2008			2007			$ Change			% Change
	($ in 000’s)
REVENUES
Same Store Properties	$	255,694		$	249,791		$	5,903			2.4	%
Acquired Properties		42,499			16,230			26,269			161.9	%
Sold Properties		21,069			78,989			(57,920	)		(73.3	)%
(Re)Developments and Land, Not Included Above		11,647			4,980			6,667			133.9	%
Other		28,877			36,889			(8,012	)		(21.7	)%
	$	359,786		$	386,879		$	(27,093	)		(7.0	)%
Discontinued Operations		(22,907	)		(81,020	)		58,113			(71.7	)%
												��
Subtotal Revenues	$	336,879		$	305,859		$	31,020			10.1	%
Construction Revenues		147,299			35,628			111,671			313.4	%
Total Revenues	$	484,178		$	341,487		$	142,691			41.8	%

Revenues from same store properties increased by $5.9 million due primarily to an increase in rental rates and an increase in tenant recoveries, partially offset by a decrease in occupancy. Revenues from acquired properties increased $26.3 million due to the 127 industrial properties acquired subsequent to December 31, 2006 totaling approximately 11.0 million square feet of GLA, as well as an acquisition of land parcels in September and October 2008 for which we receive ground rents. Revenues from sold properties decreased $57.9 million due to the 248 industrial properties sold subsequent to December 31, 2006 totaling approximately 20.5 million square feet of GLA. Revenues from (re)developments and land increased $6.7 million due to an increase in occupancy. Other revenues decreased by approximately $8.0 million due primarily to a decrease in fees earned from our Joint Ventures and a decrease in fees earned related to us assigning our interest in certain purchase contracts to third parties for consideration. Construction revenues increased $111.7 million for the year ended December 31, 2008 due primarily to three development projects that commenced in September 2007, April 2008 and August 2008 for which we are acting in the capacity of development manager.

	2008			2007			$ Change			% Change
	($ in 000’s)
PROPERTY AND CONSTRUCTION EXPENSES
Same Store Properties	$	82,379		$	77,330		$	5,049			6.5	%
Acquired Properties		14,155			4,352			9,803			225.3	%
Sold Properties		7,358			24,921			(17,563	)		(70.5	)%
(Re) Developments and Land, Not Included Above		5,504			3,602			1,902			52.8	%
Other		10,421			16,603			(6,182	)		(37.2	)%
	$	119,817		$	126,808		$	(6,991	)		(5.5	)%
Discontinued Operations		(8,360	)		(27,553	)		19,193			(69.7	)%
Property Expenses	$	111,457		$	99,255		$	12,202			12.3	%
Construction Expenses		139,539			34,553			104,986			303.8	%
Total Property and Construction Expenses	$	250,996		$	133,808		$	117,188			87.6	%

Property expenses include real estate taxes, repairs and maintenance, property management, utilities, insurance, other property related expenses and construction expenses. Property expenses from same store properties increased $5.0 million due primarily to an increase in real estate tax expense, bad debt expense and repairs and maintenance expense. Property expenses from acquired properties increased by $9.8 million due to

30

properties acquired subsequent to December 31, 2006. Property expenses from sold properties decreased by $17.6 million due to properties sold subsequent to December 31, 2006. Property expenses from (re)developments and land increased $1.9 million due primarily to an increase in the substantial completion of developments. Expenses are no longer capitalized to the basis of a property once the development is substantially complete. The $6.2 million decrease in other expense is primarily attributable to decrease in incentive compensation expense. Construction expenses increased $105.0 million for the year ended December 31, 2008 primarily due to three development projects that commenced in September 2007, April 2008 and August 2008 for which we are acting in the capacity of development manager.

General and administrative expense decreased $8.2 million, or 8.9%, due to a decrease in incentive compensation.

For the year ended December 31, 2008, we incurred $26.7 million in restructuring charges related to employee severance and benefits ($24.8 million), costs associated with the termination of certain office leases ($1.2 million) and contract cancellation and other costs ($0.7 million) related to our restructuring plan to reduce overhead costs. We anticipate a reduction of general and administrative expense in 2009 as a result of the employee terminations and office closings.

	2008			2007			$ Change			% Change
	($ in 000’s)
DEPRECIATION AND OTHER AMORTIZATION
Same Store Properties	$	99,033		$	103,436		$	(4,403	)		(4.3	)%
Acquired Properties		37,552			12,244			25,308			206.7	%
Sold Properties		4,763			24,679			(19,916	)		(80.7	)%
(Re) Developments and Land, Not Included Above		6,253			2,846			3,407			119.7	%
Corporate Furniture, Fixtures and Equipment		2,257			1,837			420			22.9	%
	$	149,858		$	145,042		$	4,816			3.3	%
Discontinued Operations		(5,573	)		(25,382	)		19,809			(78.0	)%
Total Depreciation and Other Amortization	$	144,285		$	119,660		$	24,625			20.6	%

Depreciation and other amortization for same store properties decreased $4.4 million primarily due to accelerated depreciation and amortization taken during the twelve months ended December 31, 2007 attributable to certain tenants who terminated their lease early or did not renew their lease. Depreciation and other amortization from acquired properties increased $25.3 million due to properties acquired subsequent to December 31, 2006. Depreciation and other amortization from sold properties decreased $19.9 million due to properties sold subsequent to December 31, 2006. Depreciation and other amortization for (re)developments and land increased $3.4 million due primarily to an increase in the substantial completion of developments.

Interest income increased $1.7 million, or 93.9%, due primarily to an increase in the average mortgage loans receivable outstanding during the year ended December 31, 2008, as compared to the year ended December 31, 2007.

Interest expense decreased approximately $7.8 million, or 6.5%, primarily due to a decrease in the weighted average interest rate for the year ended December 31, 2008 (5.86%), as compared to the year ended December 31, 2007 (6.45%), offset by an increase in the weighted average debt balance outstanding for the year ended December 31, 2008 ($2,037.4 million), as compared to the year ended December 31, 2007 ($1,981.4 million) and a decrease in capitalized interest for the year ended December 31, 2008 due to a decrease in development activities.

Amortization of deferred financing costs decreased $0.3 million, or 10.3%, due primarily to the amendment of our Unsecured Line of Credit in September 2007 which extended the maturity from September 2008 to September 2012. The net unamortized deferred financing fees related to the prior line of credit are amortized over the extended amortization period, except for $0.1 million, which represents the write

31

off of unamortized deferred financing costs associated with certain lenders who did not renew the line of credit and is included in loss from early retirement of debt for the twelve months ended December 31, 2007.

In October 2008, we entered into an interest rate swap agreement (the “Series F Agreement”) to mitigate our exposure to floating interest rates related to the forecasted reset rate of the Company’s Series F Preferred Stock. The Series F Agreement has a notional value of $50.0 million and is effective from April 1, 2009 through October 1, 2013. The Series F Agreement fixes the30-year U.S. Treasury rate at 5.2175%. We recorded $3.1 million in mark to market (loss) which is included in mark to market/(loss) on settlement of interest rate protection agreements in earnings for the twelve months ended December 31, 2008.

For the year ended December 31, 2008, we recognized a $2.7 million gain from early retirement of debt due to the partial repurchases of our senior unsecured notes at a discount to carrying value. For the year ended December 31, 2007, we incurred a $0.4 million loss from early retirement of debt. This includes a $0.1 million write-off of financing fees associated with our previous line of credit agreement which was amended and restated on September 28, 2007. The loss from early retirement of debt also includes $0.3 million due to early payoffs on mortgage loans.

Equity in income of Other Real Estate Partnerships increased $23.5 million, or 89.6%, primarily due to a increase in gain on sale of real estate by the Other Real Estate Partnerships.

Equity in income of Joint Ventures decreased $63.1 million, or 210.7%, primarily due to impairment losses of $25.3 million, $10.1 million, $3.2 million and $1.2 million we recorded to the 2005 Development/Repositioning Joint Venture, the 2006 Land/Development Joint Venture, the 2005 Core Joint Venture and the 2003 Net Lease Joint Venture, respectively, as a result of adverse conditions in the credit and real estate markets in accordance with APB 18 as well as a decrease in our pro rata share of gain on sale of real estate and earn outs on property sales from the 2005 Core Joint Venture and from the 2005 Development/Repositioning Joint Venture during the twelve months ended December 31, 2008 as compared to the twelve months ended December 31, 2007. Additionally, we recognized our pro rata share ($2.7 million) of impairment losses recorded in accordance with SFAS 144 for the 2006 Net Lease Co-Investment Program and the 2005 Development/Repositioning Joint Venture during the year ended December 31, 2008.

The year to date income tax provision (included in continuing operations, discontinued operations and gain on sale) decreased $34.8 million, in the aggregate, or 114.0%, due primarily to a decrease in gains on the sale of real estate within the TRS, a decrease in equity in income of Joint Ventures and costs incurred related to the restructuring. Net income of the TRS decreased by $111.6 million, or 229.0% for the year ended December 31, 2008 compared to the year ended December 31, 2007. Included in net income for the TRS for the year ended December 31, 2008 is $42.5 million of impairment loss in Equity in Income of Joint Ventures recorded in accordance with APB 18 and SFAS 144. We recorded a valuation allowance to offset the deferred tax asset that was created by a significant portion of these impairments.

The following table summarizes certain information regarding the industrial properties included in discontinued operations for the year ended December 31, 2008 and December 31, 2007.

	2008			2007
	($ in 000’s)
Total Revenues	$	22,907		$	81,020
Property Expenses		(8,360	)		(27,553	)
Depreciation and Amortization		(5,573	)		(25,382	)
Gain on Sale of Real Estate		136,384			237,368
Provision for Income Taxes		(4,188	)		(38,126	)
Income from Discontinued Operations	$	141,170		$	227,327

Income from discontinued operations, net of income taxes, for the year ended December 31, 2008 reflects the results of operations and gain on sale of real estate relating to 88 industrial properties that were sold during the year ended December 31, 2008 and the results of operations of the six industrial properties identified as held for sale at December 31, 2008.

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Income from discontinued operations, net of income taxes, for the year ended December 31, 2007 reflects the results of operations and gain on sale of real estate relating to 156 industrial properties that were sold during the year ended December 31, 2007, the results of operations of 88 industrial properties that were sold during the year ended December 31, 2008 and the results of operations of the six industrial properties identified as held for sale at December 31, 2008.

The $12.1 million gain on sale of real estate for the year ended December 31, 2008 resulted from the sale of one industrial property and several land parcels that do not meet the criteria established by SFAS 144 for inclusion in discontinued operations. The $7.9 million gain on sale of real estate for the year ended December 31, 2007 resulted from the sale of three industrial properties and several land parcels that do not meet the criteria established by SFAS 144 for inclusion in discontinued operations.

Comparison of Year Ended December 31, 2007 to Year Ended December 31, 2006

Our net income available to unitholders was $150.5 million and $103.9 million for the years ended December 31, 2007 and 2006, respectively. Basic and diluted net income available to unitholders were $2.98 per unit for the year ended December 31, 2007 and $2.05 per unit for the year ended December 31, 2006.

The tables below summarize our revenues, property expenses and depreciation and other amortization by various categories for the year ended December 31, 2007 and December 31, 2006. Same store properties are properties owned prior to January 1, 2006 and held as an operating property through December 31, 2007 and developments and redevelopments that were placed in service prior to January 1, 2006 or were substantially completed for the 12 months prior to January 1, 2006. Properties are placed in service as they reach stabilized occupancy (generally defined as 90% occupied). Acquired properties are properties that were acquired subsequent to December 31, 2005 and held as an operating property through December 31, 2007. Sold properties are properties that were sold subsequent to December 31, 2005. (Re)Developments and land are land parcels and developments and redevelopments that were not: a) substantially complete 12 months prior to January 1, 2006 or b) stabilized prior to January 1, 2006. Other revenues are derived from the operations of our maintenance company, fees earned from our Joint Ventures, and other miscellaneous revenues. Construction revenues and expenses represent revenues earned and expenses incurred in connection with the TRS acting as general contractor or development manager to construct industrial properties, including industrial properties for the 2005 Development/Repositioning Joint Venture, and also include revenues and expenses related to the development of properties for third parties. Other expenses are derived from the operations of our maintenance company and other miscellaneous regional expenses.

Our future financial condition and results of operations, including rental revenues, may be impacted by the future acquisition and sale of properties. Our future revenues and expenses may vary materially from historical rates.

For the years ended December 31, 2007 and 2006, the occupancy rates of our same store properties were 93.5% and 91.7%, respectively.

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	2007			2006			$ Change			% Change
	($ in 000’s)
REVENUES
Same Store Properties	$	260,387		$	249,270		$	11,117			4.5	%
Acquired Properties		47,762			14,369			33,393			232.4	%
Sold Properties		37,203			74,238			(37,035	)		(49.9	)%
(Re)Developments and Land, Not Included Above		4,637			3,255			1,382			42.5	%
Other		36,890			29,958			6,932			23.1	%
	$	386,879		$	371,090		$	15,789			4.3	%
Discontinued Operations		(81,020	)		(114,319	)		33,299			(29.1	)%
Subtotal Revenues	$	305,859		$	256,771		$	49,088			19.1	%
Construction Revenues		35,628			10,540			25,088			238.0	%
Total Revenues	$	341,487		$	267,311		$	74,176			27.7	%

Revenues from same store properties increased by $11.1 million due primarily to an increase in same store property occupancy rates, an increase in same store rental rates and an increase in tenant recoveries. Revenues from acquired properties increased $33.4 million due to the 182 industrial properties acquired subsequent to December 31, 2005 totaling approximately 17.7 million square feet of GLA. Revenues from sold properties decreased $37.0 million due to the 268 industrial properties sold subsequent to December 31, 2005 totaling approximately 29.2 million square feet of GLA. Revenues from (re)developments and land increased $1.4 million due to an increase in occupancy. Other revenues increased by approximately $6.9 million due primarily to an increase in joint venture fees and fees earned related to us assigning our interest in certain purchase contracts to third parties for consideration. Construction revenues increased $25.1 million for the year ended December 31, 2007 due primarily to increased third party development activity and an increased number of construction projects for which the TRS acted as general contractor.

	2007			2006			$ Change			% Change
	($ in 000’s)
PROPERTY AND CONSTRUCTION EXPENSES
Same Store Properties	$	83,576		$	82,204		$	1,372			1.7	%
Acquired Properties		11,939			3,451			8,488			246.0	%
Sold Properties		11,332			22,274			(10,942	)		(49.1	)%
(Re) Developments and Land, Not Included Above		3,359			2,872			487			17.0	%
Other		16,602			15,429			1,173			7.6	%
	$	126,808		$	126,230		$	578			0.5	%
Discontinued Operations		(27,553	)		(37,726	)		10,173			(27.0	)%
Property Expenses	$	99,255		$	88,504		$	10,751			12.1	%
Construction Expenses		34,553			10,263			24,290			236.7	%
Total Property and Construction Expenses	$	133,808		$	98,767		$	35,041			35.5	%

Property expenses include real estate taxes, repairs and maintenance, property management, utilities, insurance, other property related expenses, and construction expenses. Property expenses from same store properties increased by $1.4 million due primarily to an increase in real estate taxes due to a reassessment of values of certain of our properties, as well as an increase in repairs and maintenance. Property expenses from acquired properties increased by $8.5 million due to properties acquired subsequent to December 31, 2005. Property expenses from sold properties decreased by $10.9 million due to properties sold subsequent to

34

December 31, 2005. Property expenses from (re)developments and land increased $0.5 million due to an increase in occupancy. The $1.2 million increase in other expense is primarily attributable to an increase in employee compensation. Construction expenses increased $24.3 million for the year ended December 31, 2007 primarily due to increased third party development activity and an increased number of construction projects for which the TRS acted as general contractor.

General and administrative expense increased by approximately $15.4 million, or 20.1%, due primarily to increases in employee compensation related to compensation for additional employees as well as an increase in incentive compensation.

	2007			2006			$ Change			% Change
	($ in 000’s)
DEPRECIATION AND OTHER AMORTIZATION
Same Store Properties	$	95,462		$	94,112		$	1,350			1.4	%
Acquired Properties		33,573			11,172			22,401			200.5	%
Sold Properties		11,381			26,750			(15,369	)		(57.5	)%
(Re) Developments and Land, Not Included Above		2,789			6,310			(3,521	)		(55.8	)%
Corporate Furniture, Fixtures and Equipment		1,837			1,913			(76	)		(4.0	)%
	$	145,042		$	140,257		$	4,785			3.4	%
Discontinued Operations		(25,382	)		(40,204	)		14,822			(36.9	)%
Total Depreciation and Other Amortization	$	119,660		$	100,053		$	19,607			19.6	%

Depreciation and other amortization for same store properties remained relatively unchanged. Depreciation and other amortization from acquired properties increased by $22.4 million due to properties acquired subsequent to December 31, 2005. Depreciation and other amortization from sold properties decreased by $15.4 million due to properties sold subsequent to December 31, 2005. Depreciation and other amortization for (re)developments and land decreased by $3.5 million due primarily to accelerated depreciation recognized for the year ended December 31, 2006 on one property in Columbus, OH which was razed during 2006.

Interest income increased $0.8 million due primarily to an increase in the average mortgage loans receivable outstanding during the year ended December 31, 2007, as compared to the year ended December 31, 2006.

Interest expense decreased by approximately $1.8 million primarily due to a decrease in the weighted average interest rate for the year ended December 31, 2007 (6.45%), as compared to the year ended December 31, 2006 (6.72%) and due to an increase in capitalized interest for the year ended December 31, 2007 due to an increase in development activities, offset by an increase in the weighted average debt balance outstanding for the year ended December 31, 2007 ($1,981.4 million), as compared to the year ended December 31, 2006 ($1,878.2 million).

Amortization of deferred financing costs increased by $0.5 million, or 20.5%, due primarily to financing fees incurred associated with the issuance of $200.0 million of senior unsecured debt in December 2006.

In October 2005, we entered into an interest rate protection agreement which hedged the change in value of a build to suit development project we were constructing. This interest rate protection agreement had a notional value of $50.0 million, was based on the three month LIBOR rate, had a strike rate of 4.8675%, had an effective date of December 30, 2005 and a termination date of December 30, 2010. Per SFAS No. 133,“Accounting for Derivative Instruments and Hedging Activities”,fair value and cash flow hedge accounting for hedges of non-financial assets and liabilities is limited to hedges of the risk of changes in the market price of the entire hedged item because changes in the price of an ingredient or component of a non-financial item generally do not have a predictable, separately measurable effect on the price of the item. Since the interest rate protection agreement is hedging a component of the change in value of the build to suit development, the interest rate protection agreement does not qualify for hedge accounting and the change in value of the interest

35

rate protection agreement is recognized immediately in net income as opposed to other comprehensive income. On January 5, 2006, we settled the interest rate protection agreement for a payment of $0.2 million. Included inMark-to-Market/Loss on Settlement of Interest Rate Protection Agreement for the year ended December 31, 2006 is the settlement andmark-to-market of the interest rate protection agreement.

In April 2006, we entered into interest rate protection agreements which we designated as cash flow hedges. Each of the interest rate protection agreements had a notional value of $74.8 million, were effective from May 10, 2007 through May 10, 2012, and fixed the LIBOR rate at 5.42%. In September 2006, the interest rate protection agreements failed to qualify for hedge accounting. We settled the interest rate protection agreements and paid the counterparties $2.9 million.

We recognized a $0.4 million loss from early retirement of debt for the year ended December 31, 2007. This includes $0.1 million write-off of financing fees associated with our previous line of credit agreement which was amended and restated on September 28, 2007. The loss from early retirement of debt also includes $0.3 million due to early payoffs on mortgage loans.

Equity in income of Other Real Estate Partnerships decreased by $7.3 million primarily due to a decrease in gain on sale of real estate by the Other Real Estate Partnerships.

Equity in income of joint ventures decreased by $0.7 million primarily due to a decrease in our economic share of the gains and earn outs on property sales from the 2005 Development/Repositioning Joint Venture during the year ended December 31, 2007, partially offset by an increase in our economic share of the gains on property sales from the 2005 Core Joint Venture for the year ended December 31, 2007.

The year to date income tax provision (included in continuing operations, discontinued operations and gain of sale) decreased $12.8 million, in the aggregate, due primarily to a decrease in rental income and gain on sale of real estate and an increase in general and administrative expenses, partially offset by an increase in joint venture fees and management/leasing fees, and a decrease in interest expense within the TRS.

The following table summarizes certain information regarding the industrial properties included in discontinued operations for the year ended December 31, 2007 and December 31, 2006.

	2007			2006
	($ in 000’s)
Total Revenues	$	81,020		$	114,319
Property Expenses		(27,553	)		(37,726	)
Depreciation and Amortization		(25,382	)		(40,204	)
Gain on Sale of Real Estate		237,368			196,622
Provision for Income Taxes		(38,126	)		(51,155	)
Income from Discontinued Operations	$	227,327		$	181,856

Income from discontinued operations, net of income taxes, for the year ended December 31, 2007 reflects the results of operations and gain on sale of real estate relating to 156 industrial properties that were sold during the year ended December 31, 2007, the results of operations of 88 industrial properties that were sold during the year ended December 31, 2008 and the results of operations of the six industrial properties identified as held for sale at December 31, 2008.

Income from discontinued operations, net of income taxes, for the year ended December 31, 2006 reflects the results of operations and gain on sale of real estate relating to 109 industrial properties that were sold during the year ended December 31, 2006, the results of operations of 156 industrial properties that were sold during the year ended December 31, 2007, the results of operations of 88 industrial properties that were sold during the year ended December 31, 2008 and the results of operations of the six industrial properties identified as held for sale at December 31, 2008.

The $7.9 million gain on sale of real estate for the year ended December 31, 2007, resulted from the sale of three industrial properties and several land parcels that do not meet the criteria established by SFAS 144 for inclusion in discontinued operations. The $6.2 million gain on sale of real estate for the year ended

36

December 31, 2006, resulted from the sale of several land parcels that do not meet the criteria established by SFAS 144 for inclusion in discontinued operations.

LIQUIDITY AND CAPITAL RESOURCES

At December 31, 2008, our cash and restricted cash was approximately $2.6 and $0.1 million, respectively. Restricted cash is primarily comprised of cash held in escrow in connection with mortgage debt requirements.

We have considered our short-term (one year or less) liquidity needs and the adequacy of our estimated cash flow from operations and other expected liquidity sources to meet these needs. Our 2009 Notes, in the aggregate principal amount of $125.0 million, are due on June 15, 2009. We expect to satisfy the payment obligations on the 2009 Notes through the origination of mortgage financing although there can be no assurance that any such financing could be accomplished on reasonable terms or at all. With the exception of the 2009 Notes, we believe that our principal short-term liquidity needs are to fund normal recurring expenses, property acquisitions, developments, renovations, expansions and other nonrecurring capital improvements, debt service requirements and preferred dividends and distributions required to maintain the Company’s REIT qualification under the Code. We anticipate that these needs will be met with cash flows provided by operating, financing and investing activities, including the disposition of select assets. In addition, we plan to retain capital by adjusting our distribution policy to make per Unit distributions equivalent to the per share distributions the Company is required to make to meet its minimum distribution requirements as a REIT. We will not pay distributions in April 2009 and may not pay distributions in future quarters in 2009 depending on the Company’s taxable income. If the Company is required to pay common stock dividends in 2009, we may elect to make distributions through some combination of cash, common Units, and/or the Company’s common shares.

We expect to meet long-term (greater than one year) liquidity requirements such as property acquisitions, developments, scheduled debt maturities, major renovations, expansions and other nonrecurring capital improvements through the disposition of select assets, the long-term unsecured indebtedness and additional Units and preferred Units.

We also may finance the development or acquisition of additional properties through borrowings under our Unsecured Line of Credit. At December 31, 2008, borrowings under our Unsecured Line of Credit bore interest at a weighted average interest rate of 1.98%. Our Unsecured Line of Credit bears interest at a floating rate of LIBOR plus 0.75% or the Prime Rate, at our election. As of February 20, 2009, we had approximately $6.2 million available for additional borrowings under our Unsecured Line of Credit. Our Unsecured Line of Credit contains certain financial covenants including limitations on incurrence of debt and debt service coverage. Our access to borrowings may be limited if it fails to meet any of these covenants. We believe that we were in compliance with our financial covenants as of December 31, 2008, and we anticipate that we will be able to operate in compliance with our financial covenants in 2009. However, these financial covenants are complex and there can be no assurance that these provisions would not be interpreted by our lenders in a manner that could impose and cause us to incur material costs. In addition, our ability to meet our financial covenants may be reduced if 2009 economic and credit market conditions limit our property sales and reduce our net operating income below our projections. Any violation of these covenants would subject us to higher finance costs and fees, or accelerated maturities. In addition, our credit facilities and senior debt securities contain certain cross-default provisions, which are triggered in the event that our other material indebtedness is in default. Also, our borrowing rate on our Unsecured Line of Credit may increase in the event of a downgrade on our unsecured notes by the rating agencies.

We currently have credit ratings from Standard & Poor’s, Moody’s and Fitch Ratings of BBB-/Baa2/BBB-, respectively. Our goal is to maintain its existing credit ratings. In the event of a downgrade, management believes we would continue to have access to sufficient capital; however, our cost of borrowing would increase and our ability to access certain financial markets may be limited.

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Year Ended December 31, 2008

Net cash provided by operating activities of approximately $63.4 million for the year ended December 31, 2008 was comprised primarily of net income of approximately $45.3 million, distributions from our industrial real estate Joint Ventures of approximately $1.5 million and adjustments for non-cash items of approximately $55.3 million offset by the net change in operating assets and liabilities of approximately $38.7 million. The adjustments for the non-cash items of approximately $55.3 million are primarily comprised of depreciation and amortization of approximately $170.4 million, equity in income of Joint Ventures of approximately $33.2 million, mark to market loss related to the Series F Agreement of approximately $3.1 million, a book overdraft of approximately $3.2 million and the provision for bad debt of $3.1 million, substantially offset by the gain on sale of real estate of approximately $148.4 million, the effect of the straight-lining of rental income of approximately $6.6 million and gain on early retirement of approximately $2.7 million.

Net cash provided by investing activities of approximately $14.6 million for the year ended December 31, 2008 was comprised primarily of the net proceeds from the sale of investment in real estate, distributions from the Other Real Estate Partnerships, repayments of notes receivables, distributions from our Joint Ventures and a decrease in restricted cash that is held by an intermediary for Section 1031 exchange purposes, partially offset by the acquisition of real estate, development of real estate, capital expenditures related to the expansion and improvement of existing real estate, investments in and advances to the Other Real Estate Partnerships, contributions to and investments in our Joint Ventures and funding of mortgage loans receivable.

During the year ended December 31, 2008, we acquired 23 industrial properties comprising approximately 2.9 million square feet of GLA and several land parcels. The purchase price for these acquisitions totaled approximately $295.8 million. We also substantially completed the development of eight industrial properties comprising approximately 4.5 million square feet of GLA at a cost of approximately $92.1 million for the year ended December 31, 2008.

We invested approximately $17.3 million, and received total distributions of approximately $22.5 million from our Joint Ventures. As of December 31, 2008, our industrial real estate Joint Ventures owned 117 industrial properties comprising approximately 22.8 million square feet of GLA and several land parcels.

During the year ended December 31, 2008, we sold 89 industrial properties comprising approximately 7.4 million square feet of GLA and several land parcels. Net proceeds from the sales of the 89 industrial properties and several land parcels were approximately $407.7 million.

Net cash used in financing activities of approximately $79.8 million for the year ended December 31, 2008 was derived primarily of general partnership and limited partnership units and preferred general partnership unit distributions, the repurchase of restricted units, repayments on mortgage loans payable, repayments on senior unsecured debt, offering costs and debt issue costs, partially offset by unit contributions and the net proceeds from our Unsecured Line of Credit.

During the year ended December 31, 2008, we paid approximately $32.5 million to repurchase and retire approximately $36.6 million of our senior unsecured notes at a discount to carrying value. We recognized a gain on early retirement of debt of approximately $2.7 million due to the partial repurchase.

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Contractual Obligations and Commitments

The following table lists our contractual obligations and commitments as of December 31, 2008 (In thousands):

			Payments Due by Period
			Less Than
	Total		1 Year		1-3 Years		3-5 Years		Over 5 Years
Operating and Ground Leases*	$	48,107	$	3,864	$	6,464	$	4,307	$	33,472
Real Estate Development*		11,932		11,932		—		—		—
Long-term Debt		2,047,463		133,297		423,472		650,582		840,112
Interest Expense on Long Term Debt*		791,687		100,221		177,561		117,910		395,995
Deferred Acquisition Payment		2,948		2,948		—		—		—
Total	$	2,902,137	$	252,262	$	607,497	$	772,799	$	1,269,579

* Not on balance sheet.

Off-Balance Sheet Arrangements

Letters of credit are issued in most cases as pledges to governmental entities for development purposes. At December 31, 2008, we have $5.6 million in outstanding letters of credit, none of which are reflected as liabilities on our balance sheet. We have no other off-balance sheet arrangements other than those disclosed on the Contractual Obligations and Commitments table above.

Environmental

We incurred environmental costs of approximately $0.8 million and $0.3 million in 2008 and 2007, respectively. We estimate 2009 costs of approximately $1.1 million. We estimate that the aggregate cost which needs to be expended in 2009 and beyond with regard to currently identified environmental issues will not exceed approximately $3.2 million.

Inflation

For the last several years, inflation has not had a significant impact on us because of the relatively low inflation rates in our markets of operation. Most of our leases require the tenants to pay their share of operating expenses, including common area maintenance, real estate taxes and insurance, thereby reducing our exposure to increases in costs and operating expenses resulting from inflation. In addition, many of the outstanding leases expire within six years which may enable us to replace existing leases with new leases at higher base rentals if rents of existing leases are below the then-existing market rate.

Market Risk

The following discussion about our risk-management activities includes “forward-looking statements” that involve risk and uncertainties. Actual results could differ materially from those projected in the forward- looking statements. Our business subjects us to market risk from interest rates, and to a much lessor extent, foreign currency fluctuations.

Interest Rate Risk

This analysis presents the hypothetical gain or loss in earnings, cash flows or fair value of the financial instruments and derivative instruments which are held by us at December 31, 2008 that are sensitive to changes in the interest rates. While this analysis may have some use as a benchmark, it should not be viewed as a forecast.

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In the normal course of business, we also face risks that are either non-financial or non-quantifiable. Such risks principally include credit risk and legal risk and are not represented in the following analysis.

At December 31, 2008, approximately $1,643.7 million (approximately 80.7% of total debt at December 31, 2008) of our debt was fixed rate debt (including $50.0 million of borrowings under the Unsecured Line of Credit in which the interest rate was fixed via an interest rate protection agreement) and $393.3 million (approximately 19.3% of total debt at December 31, 2008) of our debt was variable rate debt. Currently, we do not enter into financial instruments for trading or other speculative purposes.

For fixed rate debt, changes in interest rates generally affect the fair value of the debt, but not our earnings or cash flows. Conversely, for variable rate debt, changes in the interest rate generally do not impact the fair value of the debt, but would affect our future earnings and cash flows. The interest rate risk and changes in fair market value of fixed rate debt generally do not have a significant impact on us until we are required to refinance such debt. See Note 7 to the consolidated financial statements for a discussion of the maturity dates of our various fixed rate debt.

Based upon the amount of variable rate debt outstanding at December 31, 2008, a 10% increase or decrease in the interest rate on our variable rate debt would decrease or increase, respectively, future net income and cash flows by approximately $0.8 million per year. The foregoing calculation assumes an instantaneous increase or decrease in the rates applicable to the amount of borrowings outstanding under our Unsecured Line of Credit at December 31, 2008. One consequence of the recent turmoil in the capital and credit markets has been sudden and dramatic changes in LIBOR, which could result in a greater than 10% increase to such rates. In addition, the calculation does not account for our option to elect the lower of two different interest rates under our borrowings or other possible actions, such as prepayment, that we might take in response to any rate increase. A 10% increase in interest rates would decrease the fair value of the fixed rate debt at December 31, 2008 by approximately $59.7 million to $1,049.4 million. A 10% decrease in interest rates would increase the fair value of the fixed rate debt at December 31, 2008 by approximately $66.4 million to $1,175.5 million.

The use of derivative financial instruments allows us to manage risks of increases in interest rates with respect to the effect these fluctuations would have on our earnings and cash flows. As of December 31, 2008, we had two outstanding interest rate protection agreements with an aggregate notional amount of $119.5 million which fix the interest rate on forecasted offerings of debt, one outstanding interest rate protection agreement with a notional amount of $50.0 million which fixes the interest rate on borrowings on our Unsecured Line of Credit, and one outstanding interest rate protection agreement with a notional amount of $50.0 million which mitigates our exposure to floating interest rates related to the forecasted reset rate of the Company’s Series F Preferred Stock. See Note 17 to the December 31, 2008 Consolidated Financial Statements.

Foreign Currency Exchange Rate Risk

Owning, operating and developing industrial property outside of the United States exposes the Company to the possibility of volatile movements in foreign exchange rates. Changes in foreign currencies can affect the operating results of international operations reported in U.S. dollars and the value of the foreign assets reported in U.S. dollars. The economic impact of foreign exchange rate movements is complex because such changes are often linked to variability in real growth, inflation, interest rates, governmental actions and other factors. At December 31, 2008, we had one industrial property and two land parcels for which the U.S. dollar was not the functional currency. This property and land parcels are located in Ontario, Canada and use the Canadian dollar as their functional currency. Additionally, the 2007 Canada Joint Venture had two industrial properties and several land parcels for which the functional currency is the Canadian dollar.

Subsequent Events

On January 21, 2009, we paid a fourth quarter 2008 distribution of $0.25 per Unit, totaling approximately $12.6 million.

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From January 1, 2009 to February 20, 2009, the Company awarded 8,612 shares of restricted common stock to certain directors. We issued Units to the Company in the same amount. These shares of restricted common stock had a fair value of approximately $0.1 million on the date of grant. The restricted common stock and units vest over a period of five years. Compensation expense will be charged to earnings over the respective vesting period.

From January 1, 2009 to February 20, 2009, we acquired one land parcel for a total estimated investment of approximately $0.2 million. There were no industrial properties sold during this period.

On February 25, 2009, the Board of Directors approved additional modifications to the restructuring plan consisting of further organizational and overhead cost reductions. We anticipate our total pre-tax restructuring costs to range between $32.9 million and $33.5 million, including the $26.7 million that was recorded for the year ended December 31, 2008. The additional modifications primarily consist of employee severance and benefits, office closing costs and other related costs.

Related Party Transactions

We periodically engage in transactions for which CB Richard Ellis, Inc. acts as a broker. A relative of Michael W. Brennan, the former President and Chief Executive Officer and a former director of the Company, is an employee of CB Richard Ellis, Inc. For the years ended December 31, 2008, 2007 and 2006, this relative received approximately $0.1, $0.2 and $0.3 million, respectively, in brokerage commissions or other fees for transactions with the Company and the Joint Ventures.

Other

In December 2007, the FASB issued SFAS No. 141 (revised 2007),“Business Combinations”(“SFAS 141R”). SFAS 141R establishes principles and requirements for how an acquirer recognizes and measures in it’s financial statements the identifiable assets acquired, the liabilities assumed, any noncontrolling interest in the acquiree and the goodwill acquired. SFAS 141R also establishes disclosure requirements to enable the evaluation of the nature and financial effects of the business combination. SFAS 141R is effective for financial statements issued for fiscal years beginning after December 15, 2008. We do not anticipate the adoption of SFAS 141R will have a material impact on our consolidated financial statements.

In December 2007, the FASB issued SFAS No. 160,“Noncontrolling Interests in Consolidated Financial Statements-and Amendment of ARB No. 51”(“SFAS 160”). SFAS 160 establishes accounting and reporting standards pertaining to ownership interests in subsidiaries held by parties other than the parent, the amount of net income attributable to the parent and to the noncontrolling interest, changes in a parent’s ownership interest, and the valuation of any retained noncontrolling equity investment when a subsidiary is deconsolidated. This statement also establishes disclosure requirements that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. SFAS 160 is effective for fiscal years beginning on or after December 15, 2008. We do not anticipate the adoption of SFAS 160 will have a material impact on our consolidated financial statements.

Effective January 1, 2008, the Company adopted SFAS No. 157,“Fair Value Measurements”(“SFAS 157”) and SFAS No. 159“The Fair Value Option for Financial Assets and Financial Liabilities”(“SFAS 159”). Fair value is defined under SFAS 157 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. SFAS 159 allows an entity the irrevocable option to elect fair value for the initial and subsequent measurement for certain financial assets and liabilities on acontract-by-contract basis. The adoption of SFAS 159 had no impact on our consolidated financial statements.

In February 2008, the FASB issued FASB Staff Position157-2, which deferred the effective date of SFAS 157 for one-year for nonfinancial assets and nonfinancial liabilities that are recognized or disclosed at fair value on a nonrecurring basis. SFAS 157 is now effective for those assets and liabilities for years beginning after November 15, 2008.

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In March 2008, the FASB issued SFAS No. 161. “Disclosures about Derivative Instruments and Hedging Activities — an Amendment of FASB Statement No. 133”(“SFAS 161”). SFAS 161 requires entities that utilize derivative instruments to provide qualitative disclosures about their objectives and strategies for using such instruments, as well as any details of credit-risk-related contingent features contained within derivatives. SFAS 161 also requires entities to disclose additional information about the amounts and location of derivatives located within the financial statements, how the provisions of SFAS 133 have been applied, and the impact that hedges have on an entity’s financial position, financial performance, and cash flows. SFAS 161 is effective for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. We do not anticipate the adoption of SFAS 161 will have a material impact on the disclosures contained in our financial statements.

In May 2008, the FASB issued Staff Position No. APB14-1, “Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)” (“FSP APB14-1”), that requires the liability and equity components of convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement) to be separately accounted for in a manner that reflects the issuer’s nonconvertible debt borrowing rate. FSP APB14-1 dictates the debt component to be recorded be based upon the estimated fair value of a similar nonconvertible debt. The resulting debt discount would be amortized over the period during which the debt is expected to be outstanding (i.e. through the first optional redemption date) as additional non-cash interest expense. FSP APB14-1 will become effective beginning in our first quarter of 2009 and is required to be applied retrospectively to all presented periods, as applicable. The adoption of FSP APB14-1 is expected to result in us recognizing additional non-cash interest expense of approximately $1.5 million per annum.

Item 7A.   Quantitative and Qualitative Disclosures About Market Risk

Response to this item is included in Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” above.

Item 8.   Financial Statements and Supplementary Data

See Index to Financial Statements and Financial Statement Schedule included in Item 15.

Item 9.   Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A.   Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our periodic reports pursuant to the Securities Exchange Act of 1934 (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required financial disclosure.

We carried out an evaluation, under the supervision and with the participation of our management, including the principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange ActRule 15(d)-15(b) as of the end of the period covered by this report. Based upon this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

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Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

Our management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2008. In making its assessment of internal control over financial reporting, management used the criteria described in the Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Our management has concluded that, as of December 31, 2008, our internal control over financial reporting was effective.

The effectiveness of our internal control over financial reporting as of December 31, 2008 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein within Item 15. See Report of Independent Registered Public Accounting Firm.

Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting that occurred during the fourth quarter of 2008 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Item 9B.   Other Information

None.

PART III

Item 10, 11, 12, 13 and 14.   Directors, Executive Officers and Corporate Governance, Executive Compensation, Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters, Certain Relationships and Related Transactions and Director Independence and Principal Accountant Fees and Services

The Operating Partnership has no directors or executive officers; instead it is managed by its sole general partner, the Company. The information with respect to the sole general partner of the Operating Partnership required by Item 10, Item 11, Item 12, Item 13 and Item 14 is incorporated or furnished, solely to the extent required by such item, from the Company’s definitive proxy statement, which is expected to be filed with the SEC no later than 120 days after the end of the Company’s fiscal year. Information from the Company’s definitive proxy statement shall not be deemed to be “filed” or “soliciting material,” or subject to liability for purposes of Section 18 of the Exchange Act to the maximum extent permitted under the Exchange Act.

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PART IV

Item 15.   Exhibits and Financial Statement Schedules

(a) Financial Statements, Financial Statement Schedule and Exhibits (1 & 2) See Index to Financial Statements and Financial Statement Schedule.

(3) Exhibits:

Exhibit
No.	Description
3.1	Eleventh Amended and Restated Partnership Agreement of First Industrial, L.P. dated August 21, 2006 (the “LP Agreement”) of the Company, filed August 22, 2006, FileNo. 1-13102) (incorporated by reference to Exhibit 10.2 of the Form 8-K
4.1	Indenture, dated as of May 13, 1997, between First Industrial, L.P. and First Trust National Association, as Trustee (incorporated by reference to Exhibit 4.1 of theForm 10-Q of the Company for the fiscal quarter ended March 31, 1997, as amended byForm 10-Q/A No. 1 of the Company filed May 30, 1997, FileNo. 1-13102)
4.2	Supplemental Indenture No. 1, dated as of May 13, 1997, between First Industrial, L.P. and First Trust National Association as Trustee relating to $100 million of 7.15% Notes due 2027 (incorporated by reference to Exhibit 4.2 of theForm 10-Q of the Company for the fiscal quarter ended March 31, 1997, as amended byForm 10-Q/A No. 1 of the Company filed May 30, 1997, FileNo. 1-13102)
4.3	Supplemental Indenture No. 2, dated as of May 22, 1997, between First Industrial, L.P. and First Trust National Association as Trustee relating to $100 million of 73/8% Notes due 2011 (incorporated by reference to Exhibit 4.4 of theForm 10-QT of the Operating Partnership for the fiscal quarter ended March 31, 1997, FileNo. 333-21873)
4.4	Supplemental Indenture No. 3 dated October 28, 1997 between First Industrial, L.P. and First Trust National Association providing for the issuance of Medium-Term Notes due Nine Months or more from Date of Issue (incorporated by reference to Exhibit 4.1 ofForm 8-K of the Operating Partnership, dated November 3, 1997, as filed November 3, 1997, FileNo. 333-21873)
4.5	7.50% Medium-Term Note due 2017 in principal amount of $100 million issued by First Industrial, L.P. (incorporated by reference to Exhibit 4.19 of the Company’s Annual Report onForm 10-K for the year ended December 31, 1997, FileNo. 1-13102)
4.6	Trust Agreement, dated as of May 16, 1997, between First Industrial, L.P. and First Bank National Association, as Trustee (incorporated by reference to Exhibit 4.5 of theForm 10-QT of the Operating Partnership for the fiscal quarter ended March 31, 1997, FileNo. 333-21873)
4.7	7.60% Notes due 2028 in principal amount of $200 million issued by First Industrial, L.P. (incorporated by reference to Exhibit 4.2 of theForm 8-K of the Operating Partnership dated July 15, 1998, FileNo. 333-21873)
4.8	Supplemental Indenture No. 5, dated as of July 14, 1998, between First Industrial, L.P. and U.S. Bank Trust National Association, relating to First Industrial, L.P.’s 7.60% Notes due July 15, 2028 (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Operating Partnership dated July 15, 1998, FileNo. 333-21873)
4.9	7.375% Note due 2011 in principal amount of $200 million issued by First Industrial, L.P. (incorporated by reference to Exhibit 4.15 of the Operating Partnership’s Annual Report onForm 10-K for the year ended December 31, 2000, FileNo. 333-21873)
4.10	Supplemental Indenture No. 6, dated as of March 19, 2001, between First Industrial, L.P. and U.S. Bank Trust National Association, relating to First Industrial, L.P.’s 7.375% Notes due March 15, 2011(incorporated by reference to Exhibit 4.16 of the Operating Partnership’s Annual Report onForm 10-K for the year ended December 31, 2000, FileNo. 333-21873)
4.11	Registration Rights Agreement, dated as of March 19, 2001, among First Industrial, L.P. and Credit Suisse First Boston Corporation, Chase Securities, Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney, Inc., Banc of America Securities LLC, Banc One Capital Markets, Inc. and UBS Warburg LLC (incorporated by reference to Exhibit 4.17 of the Operating Partnership’s Annual Report onForm 10-K for the year ended December 31, 2000,File No. 333-21873)

44

Exhibit
No.	Description
4.12	Supplemental Indenture No. 7 dated as of April 15, 2002, between First Industrial, L.P. and U.S. Bank National Association, relating to First Industrial, L.P.’s 6.875% Notes due 2012 and 7.75% Notes due 2032 (incorporated by reference to Exhibit 4.1 of the Operating Partnership’sForm 8-K, dated April 4, 2002, FileNo. 333-21873)
4.13	Form of 6.875% Notes due in 2012 in the principal amount of $200 million issued by First Industrial, L.P. and 7.75% Notes due in 2032 in the principal amount of $50 million issued by First Industrial L.P. (incorporated by reference to Exhibit 4.2 of the Operating Partnership’sForm 8-K dated April 4, 2002, FileNo. 333-21873)
4.14	Form of 7.75% Notes due 2032 in the principal amount of $50 million issued by First Industrial, L.P. (incorporated by reference to Exhibit 4.3 of the Operating Partnership’sForm 8-K, dated April 4, 2002, FileNo. 333-21873)
4.15	Supplemental Indenture No. 8, dated as of May 17, relating to 6.42% Senior Notes due June 1, 2014, by and between First Industrial, L.P. and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Operating Partnership, dated May 27, 2004, FileNo. 333-21873)
4.16	Supplemental Indenture No. 9, dated as of June 14, 2004, relating to 5.25% Senior Notes due 2009, by and between the Operating Partnership and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Operating Partnership, dated June 17, 2004, FileNo. 333-21873)
4.17	Supplemental Indenture No. 10, dated as of January 10, 2006, relating to 5.75% Senior Notes due 2016, by and between the Operating Partnership and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Company, filed January 11, 2006, FileNo. 1-13102)
4.18	Indenture dated as of September 25, 2006 among First Industrial, L.P., as issuer, the Company, as guarantor, and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the current report onForm 8-K of the Operating Partnership, dated September 25, 2006, FileNo. 333-21873)
4.19	Form of 4.625% Exchangeable Senior Note due 2011 (incorporated by reference to Exhibit 4.2 of the current report onForm 8-K of the Operating Partnership, dated September 25, 2006, FileNo. 333-21873)
4.20	Registration Rights Agreement dated September 25, 2006 among the Company, First Industrial, L.P. and the Initial Purchasers named therein (incorporated by reference to Exhibit 10.1 of the current report onForm 8-K of the Operating Partnership, dated September 25, 2006, FileNo. 333-21873)
4.21	Supplemental Indenture No. 11, dated as of May 7, 2007, relating to 5.95% Senior Notes due 2017, by and between First Industrial, L.P. and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Company, filed May 5, 2007, FileNo. 1-13102)
10.1	Sales Agreement by and among the Company, First Industrial, L.P. and Cantor Fitzgerald & Co. dated September 16, 2004 (incorporated by reference to Exhibit 1.1 of theForm 8-K of the Operating Partnership, dated September 16, 2004, FileNo. 333-21873)
10.2	Fifth Amended and Restated Unsecured Revolving Credit Agreement, dated as of September 28, 2007, among First Industrial, L.P., First Industrial Realty Trust, Inc., JP Morgan Chase Bank, NA and certain other banks (incorporated by reference to Exhibit 10.1 of theForm 8-K of the Company filed October 1, 2007, FileNo. 1-13102)
10.3	First Amendment, dated as of August 18, 2008, to the Fifth Amended and Restated Unsecured Revolving Credit Agreement dated as of September 28, 2007 among the Operating Partnership, the Company, JPMorgan Chase Bank, N.A. and the other lenders thereunder (incorporated by reference to Exhibit 10.1 of theForm 8-K of the Company filed August 20, 2008, FileNo. 1-13102)

45

Exhibit
No.	Description
21	Subsidiaries of the Registrant (incorporated by reference to Exhibit 21 of the Company’s Annual Report onForm 10-K for the year ended December 31, 2008, FileNo. 1-13102)
23*	Consent of PricewaterhouseCoopers LLP
31.1*	Certification of Principal Executive Officer of First Industrial Realty Trust, Inc., registrant’s sole general partner, pursuant toRule 13a-14(a) under the Securities Exchange Act of 1934, as amended
31.2*	Certification of Principal Financial Officer of First Industrial Realty Trust, Inc., registrant’s sole general partner, pursuant toRule 13a-14(a) under the Securities Exchange Act of 1934, as amended
32**	Certification of the Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

*	Filed herewith.
**	Furnished herewith.

46

EXHIBIT INDEX

Exhibit
No.	Description
3.1	Eleventh Amended and Restated Partnership Agreement of First Industrial, L.P. dated August 21, 2006 (the “LP Agreement”) (incorporated by reference to Exhibit 10.2 of theForm 8-K of the Company, filed August 22, 2006, FileNo. 1-13102)
4.1	Indenture, dated as of May 13, 1997, between First Industrial, L.P. and First Trust National Association, as Trustee (incorporated by reference to Exhibit 4.1 of theForm 10-Q of the Company for the fiscal quarter ended March 31, 1997, as amended byForm 10-Q/A No. 1 of the Company filed May 30, 1997, FileNo. 1-13102)
4.2	Supplemental Indenture No. 1, dated as of May 13, 1997, between First Industrial, L.P. and First Trust National Association as Trustee relating to $100 million of 7.15% Notes due 2027 (incorporated by reference to Exhibit 4.2 of theForm 10-Q of the Company for the fiscal quarter ended March 31, 1997, as amended byForm 10-Q/A No. 1 of the Company filed May 30, 1997, FileNo. 1-13102)
4.3	Supplemental Indenture No. 2, dated as of May 22, 1997, between First Industrial, L.P. and First Trust National Association as Trustee relating to $100 million of 73/8% Notes due 2011 (incorporated by reference to Exhibit 4.4 of theForm 10-QT of the Operating Partnership for the fiscal quarter ended March 31, 1997, FileNo. 333-21873)
4.4	Supplemental Indenture No. 3 dated October 28, 1997 between First Industrial, L.P. and First Trust National Association providing for the issuance of Medium-Term Notes due Nine Months or more from Date of Issue (incorporated by reference to Exhibit 4.1 ofForm 8-K of the Operating Partnership, dated November 3, 1997, as filed November 3, 1997, FileNo. 333-21873)
4.5	7.50% Medium-Term Note due 2017 in principal amount of $100 million issued by First Industrial, L.P. (incorporated by reference to Exhibit 4.19 of the Company’s Annual Report onForm 10-K for the year ended December 31, 1997, FileNo. 1-13102)
4.6	Trust Agreement, dated as of May 16, 1997, between First Industrial, L.P. and First Bank National Association, as Trustee (incorporated by reference to Exhibit 4.5 of theForm 10-QT of the Operating Partnership for the fiscal quarter ended March 31, 1997, FileNo. 333-21873)
4.7	7.60% Notes due 2028 in principal amount of $200 million issued by First Industrial, L.P. (incorporated by reference to Exhibit 4.2 of theForm 8-K of the Operating Partnership dated July 15, 1998, FileNo. 333-21873)
4.8	Supplemental Indenture No. 5, dated as of July 14, 1998, between First Industrial, L.P. and U.S. Bank Trust National Association, relating to First Industrial, L.P.’s 7.60% Notes due July 15, 2028 (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Operating Partnership dated July 15, 1998, FileNo. 333-21873)
4.9	7.375% Note due 2011 in principal amount of $200 million issued by First Industrial, L.P. (incorporated by reference to Exhibit 4.15 of the Operating Partnership’s Annual Report onForm 10-K for the year ended December 31, 2000, FileNo. 333-21873)
4.10	Supplemental Indenture No. 6, dated as of March 19, 2001, between First Industrial, L.P. and U.S. Bank Trust National Association, relating to First Industrial, L.P.’s 7.375% Notes due March 15, 2011(incorporated by reference to Exhibit 4.16 of the Operating Partnership’s Annual Report onForm 10-K for the year ended December 31, 2000, FileNo. 333-21873)
4.11	Registration Rights Agreement, dated as of March 19, 2001, among First Industrial, L.P. and Credit Suisse First Boston Corporation, Chase Securities, Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Salomon Smith Barney, Inc., Banc of America Securities LLC, Banc One Capital Markets, Inc. and UBS Warburg LLC (incorporated by reference to Exhibit 4.17 of the Operating Partnership’s Annual Report onForm 10-K for the year ended December 31, 2000, FileNo. 333-21873)
4.12	Supplemental Indenture No. 7 dated as of April 15, 2002, between First Industrial, L.P. and U.S. Bank National Association, relating to First Industrial, L.P.’s 6.875% Notes due 2012 and 7.75% Notes due 2032 (incorporated by reference to Exhibit 4.1 of the Operating Partnership’sForm 8-K, dated April 4, 2002, FileNo. 333-21873)

47

Exhibit
No.	Description
4.13	Form of 6.875% Notes due in 2012 in the principal amount of $200 million issued by First Industrial, L.P. and 7.75% Notes due in 2032 in the principal amount of $50 million issued by First Industrial L.P. (incorporated by reference to Exhibit 4.2 of the Operating Partnership’sForm 8-K dated April 4, 2002, FileNo. 333-21873)
4.14	Form of 7.75% Notes due 2032 in the principal amount of $50 million issued by First Industrial, L.P. (incorporated by reference to Exhibit 4.3 of the Operating Partnership’sForm 8-K, dated April 4, 2002, FileNo. 333-21873)
4.15	Supplemental Indenture No. 8, dated as of May 17, relating to 6.42% Senior Notes due June 1, 2014, by and between First Industrial, L.P. and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Operating Partnership, dated May 27, 2004,File No. 333-21873)
4.16	Supplemental Indenture No. 9, dated as of June 14, 2004, relating to 5.25% Senior Notes due 2009, by and between the Operating Partnership and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Operating Partnership, dated June 17, 2004,File No. 333-21873)
4.17	Supplemental Indenture No. 10, dated as of January 10, 2006, relating to 5.75% Senior Notes due 2016, by and between the Operating Partnership and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Company, filed January 11, 2006, FileNo. 1-13102)
4.18	Indenture dated as of September 25, 2006 among First Industrial, L.P., as issuer, the Company, as guarantor, and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 of the current report onForm 8-K of the Operating Partnership, dated September 25, 2006,File No. 333-21873)
4.19	Form of 4.625% Exchangeable Senior Note due 2011 (incorporated by reference to Exhibit 4.2 of the current report onForm 8-K of the Operating Partnership, dated September 25, 2006, FileNo. 333-21873)
4.20	Registration Rights Agreement dated September 25, 2006 among the Company, First Industrial, L.P. and the Initial Purchasers named therein (incorporated by reference to Exhibit 10.1 of the current report onForm 8-K of the Operating Partnership, dated September 25, 2006, FileNo. 333-21873)
4.21	Supplemental Indenture No. 11, dated as of May 7, 2007, relating to 5.95% Senior Notes due 2017, by and between First Industrial, L.P. and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 of theForm 8-K of the Company, filed May 5, 2007, FileNo. 1-13102)
10.1	Sales Agreement by and among the Company, First Industrial, L.P. and Cantor Fitzgerald & Co. dated September 16, 2004 (incorporated by reference to Exhibit 1.1 of theForm 8-K of the Operating Partnership, dated September 16, 2004, FileNo. 333-21873)
10.2	Fifth Amended and Restated Unsecured Revolving Credit Agreement, dated as of September 28, 2007, among First Industrial, L.P., First Industrial Realty Trust, Inc., JP Morgan Chase Bank, NA and certain other banks (incorporated by reference to Exhibit 10.1 of theForm 8-K of the Company filed October 1, 2007, FileNo. 1-13102)
10.3	First Amendment, dated as of August 18, 2008, to the Fifth Amended and Restated Unsecured Revolving Credit Agreement dated as of September 28, 2007 among the Operating Partnership, the Company, JPMorgan Chase Bank, N.A. and the other lenders thereunder (incorporated by reference to Exhibit 10.1 of theForm 8-K of the Company filed August 20, 2008, FileNo. 1-13102)
21	Subsidiaries of the Registrant (incorporated by reference to Exhibit 21 of the Company’s Annual Report onForm 10-K for the year ended December 31, 2008, FileNo. 1-13102)
23*	Consent of PricewaterhouseCoopers LLP
31.1*	Certification of Principal Executive Officer of First Industrial Realty
31.2*	Certification of Principal Financial Officer of First Industrial Realty Trust, Inc., registrant’s sole general partner, pursuant toRule 13a-14(a) under the Securities Exchange Act of 1934, as amended
32**	Certification of the Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

*	Filed herewith.
**	Furnished herewith.

48

FIRST INDUSTRIAL, L.P.

INDEX TO FINANCIAL STATEMENTS

	Page
FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm		50
Consolidated Balance Sheets of First Industrial, L.P. as of December 31, 2008 and 2007		51
Consolidated Statements of Operations of First Industrial, L.P. for the Years Ended December 31, 2008, 2007 and 2006		52
Consolidated Statements of Comprehensive Income of First Industrial, L.P. for the Years Ended December 31, 2008, 2007 and 2006		53
Consolidated Statements of Changes in Partners’ Capital of First Industrial, L.P. for the Years Ended December 31, 2008, 2007 and 2006		54
Consolidated Statements of Cash Flows of First Industrial, L.P. for the Years Ended December 31, 2008, 2007 and 2006		55
Notes to the Consolidated Financial Statements		56

FIRST INDUSTRIAL, L.P.

FINANCIAL STATEMENT SCHEDULE

	Page
FINANCIAL STATEMENT SCHEDULE
Schedule III: Real Estate and Accumulated Depreciation		S-1

49

Report of Independent Registered Public Accounting Firm

To the Partners of

First Industrial, L.P.:

In our opinion, the consolidated financial statements in the index appearing under Item 15(a)(1) present fairly, in all material respects, the financial position of First Industrial, LP. and its subsidiaries (“the Consolidated Operating Partnership”) at December 31, 2008 and 2007, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2008 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the index appearing under Item 15(a)(2) presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Also in our opinion, the Consolidated Operating Partnership maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on criteria established inInternal Control — Integrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Consolidated Operating Partnership’s management is responsible for these financial statements and financial statement schedule, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements, on the financial statement schedule, and on the Consolidated Operating Partnership’s internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/  PricewaterhouseCoopers LLP

Chicago, Illinois

March 2, 2009

50

FIRST INDUSTRIAL, L.P.

CONSOLIDATED BALANCE SHEETS

	December 31,			December 31,
	2008			2007
	(Dollars in thousands except Unit and per Unit data)
ASSETS
Assets:
Investment in Real Estate:
Land	$	684,712		$	584,774
Buildings and Improvements		2,274,041			2,258,182
Construction in Progress		55,777			70,311
Less: Accumulated Depreciation		(455,302	)		(436,512	)
Net Investment in Real Estate		2,559,228			2,476,755
Real Estate Held for Sale, Net of Accumulated Depreciation and Amortization of $2,251 and $3,038 at December 31, 2008 and December 31, 2007, respectively		21,117			37,875
Investments in and Advances to Other Real Estate Partnerships		344,800			408,849
Cash and Cash Equivalents		2,644			4,696
Restricted Cash		97			24,891
Tenant Accounts Receivable, Net		9,049			7,825
Investments in Joint Ventures		16,299			57,543
Deferred Rent Receivable, Net		28,372			27,999
Deferred Financing Costs, Net		12,197			15,373
Deferred Leasing Intangibles, Net		79,483			78,137
Prepaid Expenses and Other Assets, Net		167,889			161,200
Total Assets	$	3,241,175		$	3,301,143
LIABILITIES AND PARTNERS’ CAPITAL
Liabilities:
Mortgage Loans Payable, Net	$	77,396		$	73,550
Senior Unsecured Debt, Net		1,516,298			1,550,991
Unsecured Line of Credit		443,284			322,129
Accounts Payable, Accrued Expenses and Other Liabilities		144,070			188,269
Deferred Leasing Intangibles, Net		27,077			20,153
Rents Received in Advance and Security Deposits		22,995			26,537
Leasing Intangibles Held for Sale, Net of Accumulated Amortization of $254 and $0 at December 31, 2008 and December 31, 2007, respectively		541			—
Dividends Payable		13,846			37,311
Total Liabilities		2,245,507			2,218,940
Commitments and Contingencies		—			—
Partners’ Capital:
General Partner Preferred Units (1,550 units issued and outstanding at December 31, 2008 and 2007, respectively), with a liquidation preference of $275,000, respectively		266,211			266,211
General Partner Units (44,652,182 and 43,672,149 units issued and outstanding at December 31, 2008 and 2007, respectively)		629,856			678,586
Limited Partners’ Units (5,806,203 and 6,438,695 units issued and outstanding at December 31, 2008 and 2007, respectively)		122,009			148,429
Accumulated Other Comprehensive Loss		(22,408	)		(11,023	)
Total Partners’ Capital		995,668			1,082,203
Total Liabilities and Partners’ Capital	$	3,241,175		$	3,301,143

The accompanying notes are an integral part of the consolidated financial statements.

51

FIRST INDUSTRIAL, L.P.

CONSOLIDATED STATEMENTS OF OPERATIONS

	Year Ended			Year Ended			Year Ended
	December 31,			December 31,			December 31,
	2008			2007			2006
	(In thousands except per unit data)
Revenues:
Rental Income	$	239,965		$	210,678		$	175,239
Tenant Recoveries and Other Income		96,914			95,181			81,532
Construction Revenues		147,299			35,628			10,540
Total Revenues		484,178			341,487			267,311
Expenses:
Property Expenses		111,457			99,255			88,504
General and Administrative		83,836			92,005			76,633
Restructuring Costs		26,711			—			—
Depreciation and Other Amortization		144,285			119,660			100,053
Construction Expenses		139,539			34,553			10,263
Total Expenses		505,828			345,473			275,453
Other Income (Expense):
Interest Income		3,471			1,790			947
Interest Expense		(111,559	)		(119,314	)		(121,130	)
Amortization of Deferred Financing Costs		(2,879	)		(3,210	)		(2,664	)
Mark-to-Market/Loss on Settlement of Interest Rate Protection Agreements		(3,073	)		—			(3,112	)
Gain (Loss) From Early Retirement of Debt		2,749			(393	)		—
Total Other Income (Expense)		(111,291	)		(121,127	)		(125,959	)
Loss from Continuing Operations Before Equity in Income of Other Real Estate Partnerships, Equity in (Loss) Income of Joint Ventures and Income Tax Benefit		(132,941	)		(125,113	)		(134,101	)
Equity in Income of Other Real Estate Partnerships		49,759			26,249			33,531
Equity in (Loss) Income of Joint Ventures		(33,178	)		29,958			30,671
Income Tax Benefit		12,259			10,661			9,937
Loss from Continuing Operations		(104,101	)		(58,245	)		(59,962	)
Income from Discontinued Operations (Including Gain on Sale of Real Estate of $136,384, $237,368, and $196,622 for the Years Ended December 31, 2008, 2007 and 2006, respectively)		145,358			265,453			233,011
Provision for Income Taxes Allocable to Discontinued Operations (Including $3,732, $36,032, and $47,511 allocable to Gain on Sale of Real Estate for the Year Ended December 31, 2008, 2007 and 2006, respectively)		(4,188	)		(38,126	)		(51,155	)
Income Before Gain on Sale of Real Estate		37,069			169,082			121,894
Gain on Sale of Real Estate		12,061			7,879			6,195
Provision for Income Taxes Allocable to Gain on Sale of Real Estate		(3,782	)		(3,082	)		(2,119	)
Net Income		45,348			173,879			125,970
Less: Preferred Unit Distributions		(19,428	)		(21,320	)		(21,424	)
Less: Redemption of Preferred Units		—			(2,017	)		(672	)
Net Income Available to Unitholders	$	25,920		$	150,542		$	103,874
Basic and Diluted Earnings Per Unit:
Loss from Continuing Operations Available to Unitholders	$	(2.33	)	$	(1.52	)	$	(1.54	)
Income from Discontinued Operations	$	2.85		$	4.49		$	3.59
Net Income Available to Unitholders	$	0.52		$	2.98		$	2.05
Weighted Average Units Outstanding		49,456			50,597			50,703
Distributions per Unit	$	2.41		$	2.85		$	2.81
Net Income Available to Unitholders Attributable to:
General Partners	$	22,706		$	131,506		$	90,359
Limited Partners		3,214			19,036			13,515
Net Income Available to Unitholders	$	25,920		$	150,542		$	103,874

The accompanying notes are an integral part of the consolidated financial statements.

52

FIRST INDUSTRIAL , LP.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

	Year Ended			Year Ended			Year Ended
	December 31,			December 31,			December 31,
	2008			2007			2006
	(Dollars in thousands)
Net Income	$	45,348		$	173,879		$	125,970
Settlement of Interest Rate Protection Agreements		—			(4,261	)		(1,729	)
Mark-to-Market of Interest Rate Protection Agreements, Net of Income Tax Benefit of $610, $254 and $0 for the years ended December 31, 2008, 2007 and 2006, respectively		(8,676	)		3,819			(2,800	)
Amortization of Interest Rate Protection Agreements		(792	)		(916	)		(912	)
Write-off of Unamortized Settlement Amounts of Interest Rate Protection Agreements		831			—			—
Foreign Currency Translation Adjustment, Net of Tax Benefit (Provision) of $3,498, $(1,149) and $0 for the years ended December 31, 2008, 2007 and 2006, respectively		(2,748	)		2,134			—
Other Comprehensive Income	$	33,963		$	174,655		$	120,529

The accompanying notes are an integral part of the consolidated financial statements.

53

FIRST INDUSTRIAL, L.P.

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS’ CAPITAL

	Year Ended			Year Ended			Year Ended
	December 31,			December 31,			December 31,
	2008			2007			2006
	(Dollars in thousands)
General Partner Preferred Units — Beginning of Year	$	266,211		$	314,208		$	303,068
Distributions		(19,428	)		(23,337	)		(22,096	)
Issuance of Preferred Units		—			—			192,624
Redemption of Preferred Units		—			(47,997	)		(181,484	)
Net Income		19,428			23,337			22,096
General Partner Preferred Units — End of Year	$	266,211		$	266,211		$	314,208
General Partner Units — Beginning of Year	$	678,586		$	730,492		$	773,921
Offering Costs		(321	)		(46	)		—
Contributions and Issuance of General Partner Units		174			613			3,820
Call Spread		—			—			(6,835	)
Purchase of General Partnership Units		—			(69,430	)		—
Repurchase and Retirement of Restricted Units		(4,847	)		(3,939	)		(2,728	)
Distributions		(106,864	)		(127,618	)		(125,986	)
Unit Conversions		14,616			2,858			5,144
Amortization of General Partner Restricted Units		25,806			14,150			9,624
Reclassification to initially adopt SFAS 123R		—			—			(16,825	)
Net Income		22,706			131,506			90,357
General Partner Units — End of Year	$	629,856		$	678,586		$	730,492
Unamort. Value of Gen. Partner Restricted Units — Beg. of Year	$	—		$	—		$	(16,825	)
Issuance of General Partner Restricted Units		—			—			—
Amortization of General Partner Restricted Units		—			—			—
Restricted Unit Forfeitures		—			—			—
Reclassification to initially adopt SFAS 123R		—			—			16,825
Unamort. Value of Gen. Partner Restricted Units — End of Year	$	—		$	—		$	—
Limited Partners Units — Beginning of Year	$	148,429		$	150,759		$	159,832
Contributions and Issuance of Limited Partner Units		—			—			1,288
Distributions		(15,018	)		(18,508	)		(18,734	)
Unit Conversions		(14,616	)		(2,858	)		(5,144	)
Net Income		3,214			19,036			13,517
Limited Partners Units — End of Year	$	122,009		$	148,429		$	150,759
Accum. Other Comprehensive Loss — Beginning of Year	$	(11,023	)	$	(11,799	)	$	(6,358	)
Settlement of Interest Rate Protection Agreements		—			(4,261	)		(1,729	)
Mark to Market of Interest Rate Protection Agreements, Net of Tax Benefit		(8,676	)		3,819			(2,800	)
Amortization of Interest Rate Protection Agreements		(792	)		(916	)		(912	)
Write-off of Unamortized Settlement Amounts of Interest Rate Protection Agreements		831			—			—
Foreign Currency Translation Adjustment, Net of Tax Benefit (Provision)		(2,748	)		2,134			—
Accum. Other Comprehensive Loss — End of Year	$	(22,408	)	$	(11,023	)	$	(11,799	)
Total Partners’ Capital at End of Year	$	995,668		$	1,082,203		$	1,183,660

The accompanying notes are an integral part of the consolidated financial statements.

54

FIRST INDUSTRIAL, LP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Year Ended			Year Ended			Year Ended
	December 31,			December 31,			December 31,
	2008			2007			2006
	(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	45,348		$	173,879		$	125,970
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Depreciation		101,671			105,628			107,418
Amortization of Deferred Financing Costs		2,879			3,210			2,664
Other Amortization		65,914			48,326			35,462
Provision for Bad Debt		3,092			1,812			1,906
Mark-to-Market of Interest Rate Protection Agreements		3,073			—			(16	)
Equity in Loss (Income) of Joint Ventures		33,178			(29,958	)		(30,671	)
Distributions from Joint Ventures		1,520			31,365			31,664
Gain on Sale of Real Estate		(148,445	)		(245,247	)		(202,817	)
(Gain) Loss on Early Retirement of Debt		(2,749	)		393			—
Equity in Income of Other Real Estate Partnerships		(49,759	)		(26,249	)		(33,531	)
Distributions from Investment in Other Real Estate Partnerships		49,759			26,249			33,531
Decrease in Developments for Sale Costs		1,527			1,209			5,883
Increase in Tenant Accounts Receivable and Prepaid Expenses and Other Assets, Net		(14,986	)		(22,529	)		(15,550	)
Increase in Deferred Rent Receivable		(6,606	)		(8,810	)		(9,092	)
(Decrease) Increase in Accounts Payable, Accrued Expenses, Other Liabilities, Rents Received in Advance and Security Deposits		(25,296	)		46,374			14,077
Decrease in Restricted Cash		90			6			—
Cash Book Overdraft.		3,214			347			—
Net Cash Provided by Operating Activities		63,424			106,005			66,898
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of and Additions to Investment in Real Estate		(528,026	)		(613,696	)		(742,414	)
Net Proceeds from Sales of Investments in Real Estate		407,654			760,776			857,670
Investments in and Advances to Other Real Estate Partnerships		(40,928	)		(66,322	)		(43,098	)
Distributions/Repayments from Other Real Estate Partnerships		104,977			28,858			50,572
Contributions to and Investments in Joint Ventures		(17,327	)		(27,696	)		(32,773	)
Distributions from Joint Ventures		20,985			22,863			19,734
Funding of Notes Receivable		(10,325	)		(8,385	)		—
Repayment of Mortgage Loans Receivable		52,842			26,350			11,200
Decrease (Increase) in Restricted Cash		24,704			(8,904	)		(1,025	)
Net Cash Provided by Investing Activities		14,556			113,844			119,866
CASH FLOWS FROM FINANCING ACTIVITIES:
Offering Costs		(321	)		(46	)		(280	)
Unit Contributions		174			613			3,742
Proceeds from the Issuance of Preferred Units		—			—			200,000
Preferred Unit Offering Costs		—			—			(7,103	)
Unit Distributions		(145,347	)		(146,660	)		(143,858	)
Purchase of General Partner Units		—			(69,430	)		—
Repurchase of Restricted Units		(4,847	)		(3,939	)		(2,660	)
Redemption of Preferred Units		—			(50,014	)		(182,156	)
Preferred Unit Distributions		(19,428	)		(26,023	)		(19,248	)
Repayments of Mortgage Loans Payable		(3,271	)		(41,475	)		(10,263	)
Proceeds from Senior Unsecured Debt		—			149,595			399,306
Other Costs from Senior Unsecured Debt		—			(4,261	)		(1,729	)
Repayment of Senior Unsecured Debt		(32,525	)		(150,000	)		(150,000	)
Proceeds from Unsecured Line of Credit		550,920			879,129			779,300
Repayments on Unsecured Line of Credit		(425,030	)		(764,000	)		(1,029,800	)
Call Spread					—			(6,835	)
Debt Issuance Costs and Costs Incurred in Connection with the Early
Retirement of Debt		(79	)		(3,766	)		(6,867	)
Net Cash Used in Financing Activities		(79,754	)		(230,277	)		(178,451	)
Net Effect of Exchange Rate Changes on Cash and Cash Equivalents		(278	)		—			—
Net (Decrease) Increase in Cash and Cash Equivalents		(1,774	)		(10,428	)		8,313
Cash and Cash Equivalents, Beginning of Period		4,696			15,124			6,811
Cash and Cash Equivalents, End of Period	$	2,644		$	4,696		$	15,124

The accompanying notes are an integral part of the consolidated financial statements.

55

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands except per Unit and Unit data)

1.   Organization and Formation of Partnership

First Industrial, L.P. (the “Operating Partnership”) was organized as a limited partnership in the state of Delaware on November 23, 1993. The sole general partner is First Industrial Realty Trust, Inc. (the “Company”) which owns common units in the Operating Partnership (“Units”) representing an approximate 88.5% and 87.1% common ownership interest at December 31, 2008 and 2007, respectively. The Company also owns a preferred general partnership interest in the Operating Partnership represented by preferred Units (“Preferred Units”) with an aggregate liquidation priority of $275,000 at December 31, 2008. The Company is a real estate investment trust (“REIT”) as defined in the Internal Revenue Code of 1986 (the “Code”). The Company’s operations are conducted primarily through the Operating Partnership. The limited partners of the Operating Partnership owned, in the aggregate, approximately a 11.5% and 12.9% interest in the Operating Partnership at December 31, 2008 and 2007, respectively. Unless the context otherwise requires, the term the “Operating Partnership” refers to First Industrial, L.P. and the terms “we,” “us,” and “our” refer to First Industrial, L.P. and its controlled subsidiaries. We refer to our taxable REIT subsidiary, First Industrial Investment, Inc., as the “TRS.”

We are the sole member of several limited liability companies (the “L.L.C.s”) and the sole stockholder of the TRS (together with the Operating Partnership and the L.L.C.s, the “Consolidated Operating Partnership”), the operating data of which is consolidated with that of the Operating Partnership. The Operating Partnership also holds at least a 99% limited partnership interest in First Industrial Financing Partnership, L.P. (the “Financing Partnership”), First Industrial Securities, L.P. (the “Securities Partnership”), First Industrial Mortgage Partnership, L.P, (the “Mortgage Partnership”), First Industrial Pennsylvania, L.P. (the “Pennsylvania Partnership”), First Industrial Harrisburg, L.P. (the “Harrisburg Partnership”), First Industrial Indianapolis, L.P. (the “Indianapolis Partnership”), TK-SV, LTD. and FI Development Services, L.P. (together, the “Other Real Estate Partnerships”).

We also own minority equity interests in, and provide various services to, seven joint ventures whose purpose is to invest in industrial properties (the “2003 Net Lease Joint Venture,” the “2005 Development/Repositioning Joint Venture,” the “2005 Core Joint Venture,” the “2006 Net Lease Co-Investment Program,” the “2006 Land/Development Joint Venture,” the “2007 Canada Joint Venture,” and the “2007 Europe Joint Venture”; together the “Joint Ventures”). The Other Real Estate Partnerships and the Joint Ventures are accounted for under the equity method of accounting. One of the joint ventures, the 2007 Europe joint venture, does not own any properties and is inactive.

The operating data of our Joint Ventures is not consolidated with that of the Consolidated Operating Partnership as presented herein.

The general partners of the Other Real Estate Partnerships are separate corporations, each with at least a .01% general partnership interest in the Other Real Estate Partnership for which it acts as a general partner. Each general partner of the Other Real Estate Partnerships is a wholly-owned subsidiary of the Company.

As of December 31, 2008, we owned 723 industrial properties (inclusive of developments in progress), containing an aggregate of approximately 63.2 million square feet of gross leasable area (“GLA”). On a combined basis, as of December 31, 2008, the Other Real Estate Partnerships owned 76 industrial properties, containing an aggregate of approximately 8.0 million square feet of GLA.

Profits, losses and distributions of us, the L.L.C.s and Other Real Estate Partnerships are allocated to the general partner and the limited partners, or the members, as applicable, in accordance with the provisions contained within the partnership agreements or ownership agreements, as applicable, of us, the L.L.C.s and the Other Real Estate Partnerships.

56

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Any references to the number of buildings and square footage in the financial statement footnotes are unaudited.

2.   Current Business Risks and Uncertainties

The real estate markets have been significantly impacted by the continued deterioration of the global credit markets. The current recession has resulted in downward pressure on our net operating income and has impaired our ability to sell properties at favorable terms.

Our unsecured revolving credit facility that has a borrowing capacity of $500,000 (the “Unsecured Line of Credit”) and the indentures under which our senior unsecured indebtedness is, or may be, issued contain certain financial covenants, including, among other things, debt service coverage and fixed charge coverage ratios, as well as limitations on our ability to incur secured and unsecured indebtedness. Consistent with our prior practice, we will, in the future, continue to interpret and certify our performance under these covenants in a good faith manner that we deem reasonable and appropriate. However, these financial covenants are complex and there can be no assurance that these provisions would not be interpreted by our lenders in a manner that could impose and cause us to incur material costs. Any violation of these covenants would subject. us to higher finance costs and fees, or accelerated maturities. In addition, our credit facilities and senior debt securities contain certain cross-default provisions, which are triggered in the event that our other material indebtedness is in default. Under the Unsecured Line of Credit, an event of default can also occur if the lenders, in their good faith judgment, determine that a material adverse change has occurred which could prevent timely repayment or materially impair our ability to perform our obligations under the loan agreement.

We believe that we were in compliance with our financial covenants as of December 31, 2008, and we anticipate that we will be able to operate in compliance with our financial covenants in 2009. However, our ability to meet our financial covenants may be reduced if 2009 economic and credit market conditions limit our property sales and reduce our net operating income below our projections. We expect to refinance indebtedness maturing in 2009 and to comply with our financial covenants in 2009 and beyond. We plan to enhance our liquidity through a combination of capital retention, mortgage financing and asset sales.

•  Retained Capital— We plan to retain capital by adjusting our distribution policy to make per Unit distributions equivalent to the per share distributions the Company is required to make to meet its minimum distribution requirements as a REIT. We will not pay distributions in April 2009 and may not pay distributions in future quarters in 2009 depending on the Company’s taxable income. If the Company is required to pay common stock dividends in 2009, we may elect to make distributions through some combination of cash, common Unitsand/or the Company’s common shares.

•  Mortgage Financing— In June 2009, we have $125,000 of unsecured debt maturing, and in July 2009 we have $5,025 of secured mortgage debt maturing. We are in active discussions with various lenders regarding the origination of mortgage financing. The total loan proceeds are expected to be sufficient to meet these maturities. No assurances can be made that new secured financing will be obtained. If we fail to timely retire our maturing debt, we will be in default under our Unsecured Line of Credit and our senior unsecured debt securities.

•  Asset Sales— We are in various stages of discussions with third parties for the sale of properties during the first quarter of 2009, and will continue to market other properties for sale throughout 2009. If we are unable to sell properties on an advantageous basis, this may impair our liquidity and our ability to meet our financial covenants.

In addition, we may from time to time repurchase or redeem our outstanding securities. Any repurchases or redemptions would depend upon prevailing market conditions, our liquidity requirements, contractual restrictions and other factors we consider important. Future repurchases or redemptions may materially impact our liquidity, future tax liability and results of operations.

57

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Although we believe we will be successful in meeting our liquidity needs through a combination of capital retention, mortgage financing and asset sales, if we were to be unsuccessful in executing one or more of the strategies outlined above, we would be materially adversely effected.

3.   Basis of Presentation

Our consolidated financial statements at December 31, 2008 and 2007 and for each of the years ended December 31, 2008, 2007 and 2006 include the accounts and operating results of the Operating Partnership, the L.L.C.s and the TRS on a consolidated basis. Such financial statements present our limited partnership interests in each of the Other Real Estate Partnerships and our minority equity interests in our Joint Ventures under the equity method of accounting. All intercompany transactions have been eliminated in consolidation.

4.   Summary of Significant Accounting Policies

In order to conform with generally accepted accounting principles, we are required in preparation of our financial statements to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of December 31, 2008 and 2007, and the reported amounts of revenues and expenses for each of the years ended December 31, 2008, 2007 and 2006. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents include all cash and liquid investments with an initial maturity of three months or less. The carrying amount approximates fair value due to the short maturity of these investments.

Restricted Cash

At December 31, 2008 and 2007, restricted cash includes cash held in escrow in connection with mortgage debt requirementsand/or gross proceeds from the sales of certain industrial properties. These sales proceeds will be disbursed as we exchange into properties under Section 1031 of the Code. The carrying amount approximates fair value due to the short term maturity of these investments.

Investment in Real Estate and Depreciation

Investment in Real Estate is carried at cost. We review our properties on a periodic basis for impairment and provide a provision if impairments are found. To determine if an impairment may exist, we review our properties and identify those that have had either an event of change or event of circumstance warranting further assessment of recoverability (such as a decrease in occupancy). If further assessment of recoverability is needed, we estimate the future net cash flows expected to result from the use of the property and its eventual disposition, on an individual property basis. If the sum of the expected future net cash flows (undiscounted and without interest charges) is less than the carrying amount of the property, on an individual property basis, we will recognize an impairment loss based upon the estimated fair value of such property. For properties we consider held for sale, we cease depreciating the properties and value the properties at the lower of depreciated cost or fair value, less costs to dispose. If circumstances arise that were previously considered unlikely, and, as a result, we decide not to sell a property previously classified as held for sale, we will reclassify such property as held and used. Such property is measured at the lower of its carrying amount (adjusted for any depreciation and amortization expense that would have been recognized had the property been continuously classified as held and used) or fair value at the date of the subsequent decision not to sell. To calculate the fair value of properties held for sale, we deduct from the estimated sales price of the property the estimated costs to close the sale. We classify properties as held for sale when all criteria within Financial Accounting Standards Board’s (the “FASB”) Statement of Financial Accounting Standard (“SFAS”) No. 144“Accounting for the Impairment or Disposal of Long-Lived Assets” (“SFAS 144”) are met.

58

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Interest costs, real estate taxes, compensation costs of development personnel and other directly related costs incurred during construction periods are capitalized and depreciated commencing with the date the property is substantially completed. Upon substantial completion, we reclassify construction in progress to building, tenant improvement and leasing commissions. Such costs begin to be capitalized to the development projects from the point we are undergoing necessary activities to get the development ready for its intended use and ceases when the development projects are substantially completed and held available for occupancy. Depreciation expense is computed using the straight-line method based on the following useful lives:

	Years
Buildings and Improvements		8 to 50
Land Improvements		3 to 15
Furniture, Fixtures and Equipment		5 to 10

Construction expenditures for tenant improvements, leasehold improvements and leasing commissions (inclusive of compensation costs of personnel attributable to leasing) are capitalized and amortized over the terms of each specific lease. Capitalized compensation costs of personnel attributable to leasing relate to time directly attributable to originating leases with independent third parties that result directly from and are essential to originating those leases and would not have been incurred had these leasing transactions not occurred. Repairs and maintenance are charged to expense when incurred. Expenditures for improvements are capitalized.

We account for all acquisitions entered into subsequent to June 30, 2001 in accordance with SFAS No. 141,“Business Combinations”. Upon acquisition of a property, we allocate the purchase price of the property based upon the fair value of the assets acquired, which generally consist of land, buildings, tenant improvements, leasing commissions and intangible assets including in-place leases, above market and below market leases and tenant relationships. We allocate the purchase price to the fair value of the tangible assets of an acquired property by valuing the property as if it were vacant. Acquired above and below market leases are valued based on the present value of the difference between prevailing market rates and the in-place rates measured over a period equal to the remaining term of the lease for above market leases and the initial term plus the term of any below market fixed rate renewal options that are considered bargain renewal options for below market leases. The above market lease values are amortized as a reduction of rental revenue over the remaining term of the respective leases, and the below market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below market fixed rate renewal options that are considered bargain renewal options of the respective leases.

The purchase price is further allocated to in-place lease values and tenant relationships based on our evaluation of the specific characteristics of each tenant’s lease and our overall relationship with the respective tenant. The value of in-place lease intangibles and tenant relationships, which are included as components of Deferred Leasing Intangibles, Net, are amortized over the remaining lease term (and expected renewal periods of the respective lease for tenant relationships) as adjustments to depreciation and other amortization expense. If a tenant terminates its lease early, the unamortized portion of leasing commissions, tenant improvements, above and below market leases, the in-place lease value and tenant relationships is immediately written off.

59

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Deferred Leasing Intangibles, exclusive of Deferred Leasing Intangibles held for sale, included in our total assets consist of the following:

	December 31,			December 31,
	2008			2007
In-Place Leases	$	75,282		$	78,332
Less: Accumulated Amortization		(27,426	)		(22,048	)
	$	47,856		$	56,284
Above Market Leases	$	13,130		$	5,069
Less: Accumulated Amortization		(1,866	)		(2,023	)
	$	11,264		$	3,046
Tenant Relationships	$	25,361		$	21,597
Less: Accumulated Amortization		(4,998	)		(2,790	)
	$	20,363		$	18,807
Total Deferred Leasing Intangibles, Net	$	79,483		$	78,137

Deferred Leasing Intangibles, exclusive of Deferred Leasing Intangibles held for sale, included in our total liabilities consist of the following:

	December 31,			December 31,
	2008			2007
Below Market Leases	$	37,489		$	28,316
Less: Accumulated Amortization		(10,412	)		(8,163	)
Total Deferred Leasing Intangibles, Net	$	27,077		$	20,153

Amortization expense related to in-place leases and tenant relationships of deferred leasing intangibles was $27,592, $20,502, and $14,139, for the years ended December 31, 2008, 2007, and 2006, respectively. Rental revenues increased by $7,537, $3,814, and $3,110 related to net amortization of above/(below) market leases for the years ended December 31, 2008, 2007, and 2006, respectively. We will recognize net amortization expense related to the deferred leasing intangibles over the next five years, for properties owned as of December 31, 2008, as follows:

			Estimated Net Increase
	Estimated Net Amortization		to Rental Revenues
	of In-Place Leases and		Related to Above
	Tenant Relationships		and Below Market Leases
2009	$	14,612	$	3,943
2010		11,278		2,980
2011		8,766		1,675
2012		7,244		1,150
2013		6,124		875

Construction Revenues and Expenses

During 2008, 2007 and 2006, the TRS entered into contracts with third parties to construct industrial properties and during 2008 and 2007, also acted as general contractor to construct industrial properties including properties for the 2005 Development/Repositioning Joint Venture. We use the percentage-of-completion contract method to recognize revenue. Using this method, revenues are recorded based on estimates of the percentage of completion of individual contracts. The percentage of completion estimates are based on

60

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

a comparison of the contract expenditures incurred to the estimated final costs. Changes in job performance, job conditions and estimated profitability may result in revisions to costs and income and are recognized in the period in which the revisions are determined.

Foreign Currency Transactions and Translation

During 2008, we owned one industrial property and two land parcels located in Toronto, Canada for which the functional currency was determined to be the Canadian dollar. Additionally, the 2007 Canada Joint Venture owns two industrial properties and several land parcels in Canada for which the functional currency is the Canadian dollar. The assets and liabilities of these industrial properties and land parcels are translated to U.S. dollars from the Canadian dollar based on the current exchange rate prevailing at each balance sheet date. The income statement accounts of the industrial properties and land parcels are translated using the average exchange rates for the period. The resulting translation adjustments are included in accumulated other comprehensive income. For the years ended December 31, 2008 and 2007, we recorded $(6,246) and $3,283 in foreign currency translation (loss) gain, respectively, offset by $3,498 and $(1,149) of income tax benefit (provision), respectively.

Deferred Financing Costs

Deferred financing costs include fees and costs incurred to obtain long-term financing. These fees and costs are being amortized over the terms of the respective loans. Accumulated amortization of deferred financing costs was $17,918 and $15,089 at December 31, 2008 and 2007, respectively. Unamortized deferred financing costs are written-off when debt is retired before the maturity date.

Investment in and Advances to Other Real Estate Partnerships

Investment in and Advances to Other Real Estate Partnerships represents our limited partnership interests in and advances to, through the Operating Partnership, the Other Real Estate Partnerships. We account for our Investment in and Advances to Other Real Estate Partnerships under the equity method of accounting. Under the equity method of accounting, our share of earnings or losses of the Other Real Estate Partnerships is reflected in income as earned and contributions or distributions increase or decrease, respectively, our Investment in and Advances to Other Real Estate Partnerships as paid or received, respectively.

On a periodic basis, we assess whether there are any indicators that the value of our Investment in and Advances to Other Real Estate Partnerships may be impaired in accordance with APB Opinion No. 18,“The Equity Method of Accounting for Investments in Common Stock”(“APB 18”). An investment is impaired only if our estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the value of the investment. Our estimates of value for each investment are based on a number of subjective assumptions that are subject to economic and market uncertainties including, among others, demand for space, market rental rates and operating costs and the discount rate used to value the cash flows of the properties. As these factors are difficult to predict and are subject to future events that may alter our assumptions, our values estimated by management in the impairment analyses may not be realized.

Investments in Joint Ventures

Investments in Joint Ventures represent our limited partnership interests in our Joint Ventures. We account for our investments in Joint Ventures under the equity method of accounting, as we do not have operational control or a majority voting interest. Under the equity method of accounting, our share of earnings or losses of our Joint Ventures is reflected in income as earned and contributions or distributions increase or decrease, respectively, our Investments in Joint Ventures as paid or received, respectively. Differences between our

61

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

carrying value of our investments in Joint Ventures and our underlying equity of such Joint Ventures are amortized over the respective lives of the underlying assets, as applicable.

On a periodic basis, we assess whether there are any indicators that the value of our Investments in Joint Ventures may be impaired in accordance with APB 18. An investment is impaired only if our estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the value of the investment. Our estimates of value for each investment are based on a number of subjective assumptions that are subject to economic and market uncertainties including, among others, demand for space, market rental rates and operating costs, the discount rate used to value the cash flows of the properties and the discount rate used to value the Joint Ventures’ debt. As these factors are difficult to predict and are subject to future events that may alter our assumptions, our values estimated in the impairment analyses may not be realized.

Stock Based Compensation

Effective January 1, 2006 we adopted SFAS No. 123R,“Share Based Payment,” using the modified prospective application method, which requires measurement of compensation cost for all stock-based awards at fair value on the date of grant and recognition of compensation over the service period for awards expected to vest.

Revenue Recognition

Rental income is recognized on a straight-line method under which contractual rent increases are recognized evenly over the lease term. Tenant recovery income includes payments from tenants for real estate taxes, insurance and other property operating expenses and is recognized as revenue in the same period the related expenses are incurred by us.

Revenue is recognized on payments received from tenants for early lease terminations after we determine that all the necessary criteria have been met in accordance with SFAS No. 13,“Accounting for Leases”.

Interest income on mortgage loans receivable is recognized based on the accrual method unless a significant uncertainty of collection exists. If a significant uncertainty exists, interest income is recognized as collected.

We provide an allowance for doubtful accounts against the portion of tenant accounts receivable which is estimated to be uncollectible. Accounts receivable in the consolidated balance sheets are shown net of an allowance for doubtful accounts of $2,519 and $2,573 as of December 31, 2008 and 2007, respectively. For accounts receivable we deem uncollectible, we use the direct write-off method.

Gain on Sale of Real Estate

Gain on sale of real estate is recognized using the full accrual method, when appropriate. Gains relating to transactions which do not meet the full accrual method of accounting are deferred and recognized when the full accrual method of accounting criteria are met or by using the installment or deposit methods of profit recognition, as appropriate in the circumstances. As the assets are sold, their costs and related accumulated depreciation are written off with resulting gains or losses reflected in net income or loss. Estimated future costs to be incurred by us after completion of each sale are included in the determination of the gain on sales.

Income Taxes

In accordance with partnership taxation, each of the partners are responsible for reporting their share of taxable income or loss.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

A provision has been made for federal income taxes in the accompanying consolidated financial statements for activities conducted in the TRS, which has been accounted for under SFAS No. 109,“Accounting for Income Taxes”(“SFAS 109”). In accordance with SFAS 109, the total benefit/expense has been separately allocated to income from continuing operations, income from discontinued operations and gain on sale of real estate.

We are subject to certain state and local income, excise and franchise taxes. The provision for excise and franchise taxes has been reflected in general and administrative expense in the consolidated statements of operations and has not been separately stated due to its insignificance. State and local income taxes are included in the provision/benefit for income taxes which is allocated to income from continuing operations, income from discontinued operations and gain on sale of real estate.

We file income tax returns in the U.S., and various states and foreign jurisdictions. At December 31, 2007 the TRS was under examination by the Internal Revenue Service for tax years 2004 and 2005. During 2008 we received notification from the Internal Revenue Service that they have completed their examinations of the TRS for the 2004 and 2005 tax years. There were no changes to taxable income of the TRS as a result of the examination. In general, the statutes of limitations for income tax returns remain open for the years 2005 through 2008.

Earnings Per Unit (“EPU”)

Net income per weighted average general partnership and limited partnership unit — basic is based on the weighted average Units outstanding (excluding restricted units that have not yet vested). Net income per weighted average Unit — diluted is based on the weighted average Units outstanding (excluding restricted units that have not yet vested) plus the dilutive effect of the Company’s in-the-money employee stock options, restricted stock and 2011 Exchangeable Notes (hereinafter defined) that result in the issuance of general partnership units. See Note 12 for further disclosure about earnings per Unit.

Fair Value of Financial Instruments

On January 1, 2008, we adopted SFAS No. 157,“Fair Value Measurements” (“SFAS 157”), which defines fair-value, establishes a framework for measuring fair-value, and expands disclosures about fair-value measurements. SFAS 157 applies to reported balances that are required or permitted to be measured at fair-value under existing accounting pronouncements; accordingly, the standard does not require any new fair-value measurements of reported balances. As of December 31, 2008, we have applied the provisions of SFAS 157 to the valuation of our interest rate swaps and our proportionate share of interest rate swaps entered into by certain Joint Ventures, which are the only financial instruments measured at fair-value on a recurring basis. Additionally, we have applied the provisions of SFAS 157 to the valuations of our Joint Ventures for purposes of our APB 18 analysis.

Other financial instruments include short-term investments, tenant accounts receivable, net, mortgage notes receivable, accounts payable, other accrued expenses, mortgage loans payable, unsecured line of credit and senior unsecured debt. The fair values of the short-term investments, tenant accounts receivable, net, accounts payable and other accrued expenses approximates their carrying or contract values. See Note 7 for the fair values of the mortgage loans payable, unsecured line of credit and senior unsecured debt and see Note 10 for the fair value of our mortgage notes receivable.

Derivative Financial Instruments

Historically, we have used interest rate protection agreements (“Agreements”) to fix the interest rate on anticipated offerings of senior unsecured debt or convert floating rate debt to fixed rate debt. Receipts or payments that result from the settlement of Agreements used to fix the interest rate on anticipated offerings of

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

senior unsecured debt are amortized over the life of the senior unsecured debt and included in interest expense. Receipts or payments resulting from Agreements used to convert floating rate debt to fixed rate debt are recognized as a component of interest expense. Agreements which qualify for hedge accounting are marked-to-market and any gain or loss is recognized in other comprehensive income (partners’ capital). Any Agreements which no longer qualify for hedge accounting are marked-to-market and any gain or loss is recognized in net income immediately. The credit risks associated with Agreements are controlled through the evaluation and monitoring of the creditworthiness of the counterparty. In the event that the counterparty fails to meet the terms of Agreements, our exposure is limited to the current value of the interest rate differential, not the notional amount, and our carrying value of Agreements on the balance sheet. See Note 17 for more information on Agreements.

Discontinued Operations

SFAS 144 addresses financial accounting and reporting for the disposal of long lived assets. SFAS 144 requires that the results of operations and gains or losses on the sale of property or property held for sale be presented in discontinued operations if both of the following criteria are met: (a) the operations and cash flows of the property have been (or will be) eliminated from our ongoing operations as a result of the disposal transaction and (b) we will not have any significant continuing involvement in the operations of the property after the disposal transaction. SFAS 144 also requires prior period results of operations for these properties to be reclassified and presented in discontinued operations in prior consolidated statements of operations.

Segment Reporting

Management views the Consolidated Operating Partnership as a single segment.

Recent Accounting Pronouncements

In December 2007, the FASB issued SFAS No. 141 (revised 2007),“Business Combinations”(“SFAS 141R”). SFAS 141R establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any noncontrolling interest in the acquiree and the goodwill acquired. SFAS 141R also establishes disclosure requirements to enable the evaluation of the nature and financial effects of the business combination. SFAS 141R is effective for financial statements issued for fiscal years beginning after December 15, 2008. We do not expect the adoption of SFAS 141R will have a material impact on our consolidated financial statements.

In December 2007, the FASB issued SFAS No. 160,“Noncontrolling Interests in Consolidated Financial Statements-and Amendment of ARB No. 51”(“SFAS 160”). SFAS 160 establishes accounting and reporting standards pertaining to ownership interests in subsidiaries held by parties other than the parent, the amount of net income attributable to the parent and to the noncontrolling interest, changes in a parent’s ownership interest, and the valuation of any retained noncontrolling equity investment when a subsidiary is deconsolidated. This statement also establishes disclosure requirements that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. SFAS 160 is effective for fiscal years beginning on or after December 15, 2008. We do not expect the adoption of SFAS 160 will have a material impact on our consolidated financial statements.

Effective January 1, 2008, the Company adopted SFAS 157 and SFAS No. 159“The Fair Value Option for Financial Assets and Financial Liabilities”(“SFAS 159”). Fair value is defined under SFAS 157 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. SFAS 159 allows an entity the irrevocable option to elect fair value for the initial and subsequent measurement for certain financial assets and liabilities on acontract-by-contract basis. The adoption of SFAS 159 had no impact on our consolidated financial statements.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

In February 2008, the FASB issued FASB Staff Position157-2, which deferred the effective date of SFAS 157 for one-year for nonfinancial assets and nonfinancial liabilities that are recognized or disclosed at fair value on a nonrecurring basis. SFAS 157 is now effective for those assets and liabilities for years beginning after November 15, 2008.

In March 2008, the FASB issued SFAS No. 161,“Disclosures about Derivative Instruments and Hedging Activities — an Amendment of FASB Statement No. 133” (“SFAS 161”). SFAS 161 requires entities that utilize derivative instruments to provide qualitative disclosures about their objectives and strategies for using such instruments, as well as any details of credit-risk-related contingent features contained within derivatives. SFAS 161 also requires entities to disclose additional information about the amounts and location of derivatives located within the financial statements, how the provisions of SFAS 133 have been applied, and the impact that hedges have on an entity’s financial position, financial performance, and cash flows. SFAS 161 is effective for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. We do not anticipate the adoption of SFAS 161 will have a material impact on the disclosures contained in our financial statements.

In May 2008, the FASB issued Staff Position No. APB14-1, “Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)” (“FSP APB14-1”), that requires the liability and equity components of convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement) to be separately accounted for in a manner that reflects the issuer’s nonconvertible debt borrowing rate. FSP APB14-1 dictates the debt component to be recorded be based upon the estimated fair value of a similar nonconvertible debt. The resulting debt discount would be amortized over the period during which the debt is expected to be outstanding (i.e. through the first optional redemption date) as additional non-cash interest expense. FSP APB14-1 will become effective beginning in our first quarter of 2009 and is required to be applied retrospectively to all presented periods, as applicable. The adoption of FSP APB14-1 is expected to result in us recognizing additional non-cash interest expense of approximately $1.5 million per annum.

5.   Investments in and Advances to Other Real Estate Partnerships

The investments in and advances to Other Real Estate Partnerships reflects the Operating Partnership’s limited partnership equity interests in the entities referred to in Note 1 to these consolidated financial statements.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Summarized condensed financial information as derived from the financial statements of the Other Real Estate Partnerships is presented below:

Condensed Combined Balance Sheets:

	December 31,		December 31,
	2008		2007
ASSETS
Assets:
Investment in Real Estate, Net	$	303,262	$	339,533
Other Assets, Net		56,505		83,939
Total Assets	$	359,767	$	423,472
LIABILITIES AND PARTNERS’ CAPITAL
Liabilities:
Other Liabilities	$	11,670	$	11,216
Partners’ Capital		348,097		412,256
Total Liabilities and Partners’ Capital	$	359,767	$	423,472

Condensed Combined Statements of Operations:

	Year Ended			Year Ended			Year Ended
	December 31,			December 31,			December 31,
	2008			2007			2006
Total Revenues (including Interest Income)	$	42,318		$	38,941		$	33,481
Property Expenses		(13,504	)		(11,183	)		(9,485	)
General and Administrative		—			(16	)		(149	)
Interest Expense		—			—			(11	)
Amortization of Deferred Financing Costs		—			—			(2	)
Depreciation and Other Amortization		(16,742	)		(17,769	)		(14,956	)
Income Tax Provision		—			(9	)		—
Income from Continuing Operations		12,072			9,964			8,878
Income from Discontinued Operations (Including Gain on Sale of Real Estate of $35,783, $7,594, and $16,820 for the years ended December 31, 2008, 2007 and 2006		38,203			14,969			25,061
(Loss) Gain on Sale of Real Estate		(53	)		1,546			(124	)
Net Income	$	50,222		$	26,479		$	33,815

6.   Investments in Joint Ventures and Property Management Services

On September 28, 1998, we entered into the 1998 Core Venture with an institutional investor to invest in industrial properties. At December 31, 2006, we owned a ten percent equity interest in the 1998 Core and provided property and asset management services to the 1998 Core Joint Venture. On January 31, 2007, we purchased the 90% equity interest from the institutional investor in the 1998 Core Joint Venture. We paid $18,458 in cash and assumed $30,340 in mortgage loans payable. As of December 31, 2007, we paid off and

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

retired the mortgage loan payable. In connection with the early repayment of the mortgage loans payable, we incurred prepayment penalties and a write-off of unamortized deferred financing fees totaling $265.

On May 16, 2003, we entered into the 2003 Net Lease Joint Venture with an institutional investor to invest in industrial properties. We own a 15% equity interest in and provide property management services to the 2003 Net Lease Joint Venture. For the year ended December 31, 2008, we recorded an impairment loss of $1,249 in equity in income of Joint Ventures in accordance with APB 18. As of December 31, 2008, the 2003 Net Lease Joint Venture owned 10 industrial properties comprising approximately 5.1 million square feet of GLA.

On March 18, 2005, we entered into the 2005 Development/Repositioning Joint Venture with an institutional investor to invest in, own, develop, redevelop and operate certain industrial properties. We own a 10% equity interest in and provide property management, asset management, development management and leasing management services to the 2005 Development/Repositioning Joint Venture. During the year ended December 31, 2008, we recorded an impairment loss of $483 in equity in income of Joint Ventures which represents our proportionate share of SFAS 144 impairment loss related to two industrial properties and one land parcel owned by the 2005 Development/Repositioning Joint Venture. Additionally, for the year ended December  31, 2008 we recorded an impairment loss of $25,332 in equity in income of Joint Ventures in accordance with APB 18. As of December 31, 2008, the 2005 Development/Repositioning Joint Venture owned 44 industrial properties comprising approximately 7.8 million square feet of GLA and several land parcels.

On September 7, 2005, we entered into the 2005 Core Joint Venture with an institutional investor to invest in, own and operate certain industrial properties. We own a 10% equity interest in and provide property management, asset management, development management, disposition, incentive and leasing management services to the 2005 Core Joint Venture. For the year ended December 31, 2008, we recorded an impairment loss of $3,153 in equity in income of Joint Ventures in accordance with APB 18. As of December 31, 2008, the 2005 Core Joint Venture owned 48 industrial properties comprising approximately 3.9 million square feet of GLA and several land parcels.

On March 21, 2006, we entered into the 2006 Net Lease Co-Investment Program with an institutional investor to invest in industrial properties. We own a 15% equity interest in and provide property management, asset management and leasing management services to the 2006 Net Lease Co-Investment Program. During the year ended December 31, 2008, we recorded an impairment loss of $2,216 in equity in income of Joint Ventures which represents our proportionate share of the SFAS 144 impairment loss related to two industrial properties owned by the 2006 Net Lease Co-Investment Program. As of December 31, 2008, the 2006 Net Lease Co-Investment Program owned 12 industrial properties comprising approximately 5.0 million square feet of GLA.

On July 21, 2006, we entered into the 2006 Land/Development Joint Venture with an institutional investor to invest in land and vertical development. We own a 10% equity interest in and provide property management, asset management, development management and leasing management services to the 2006 Land/Development Joint Venture. For the year ended December 31, 2008 we recorded an impairment loss of $10,105 in equity in income of Joint Ventures in accordance with APB 18. As of December 31, 2008, the 2006 Land/Development Joint Venture owned one industrial property comprising approximately 0.8 million square feet of GLA and several land parcels.

During July 2007, we entered into a management arrangement with an institutional investor to provide property management, leasing, acquisition, disposition and portfolio management services for industrial properties (the “July 2007 Fund”). We do not own an equity interest in the July 2007 Fund, however we are entitled to incentive payments if certain economic thresholds related to the industrial properties are achieved.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During December 2007, we entered into the 2007 Canada Joint Venture and the 2007 Europe Joint Venture with an institutional investor to invest in, own, develop, redevelop and operate industrial properties. We own a 10% equity interest in and will provide property management, asset management, development management and leasing management services to the 2007 Canada Joint Venture and the 2007 Europe Joint Venture. As of December 31, 2008, and the 2007 Canada Joint Venture owned two industrial properties comprising approximately 0.2 million square feet of GLA and several land parcels. As of December 31, 2008, the 2007 Europe Joint Venture did not own properties and is inactive.

The 2006 Land/Development Joint Venture and the 2007 Canada Joint Venture are considered variable interest entities in accordance with SFAS Interpretation No. 46(R), “Consolidation of Variable Interest Entities”. However we are not considered the primary beneficiary for either venture. As of December 31, 2008 our investments in the 2006 Land/Development Joint Venture and the 2007 Canada Joint Venture are $0 and $1,486, respectively. We calculate our maximum exposure to loss to equal our investment balance for each venture as of year end plus any future contributions we make to the ventures.

During the year ended December 31, 2006, we sold two land parcels to the 2005 Development/Repositioning Joint Venture. During the year ended December 31, 2005, we sold seven industrial properties comprising approximately 1.5 million square feet of GLA and several land parcels to the 2005 Development/Repositioning Joint Venture. We deferred 10% of the gain from the sales, which is equal to our economic interest in the 2005 Development/Repositioning Joint Venture. On May 18, 2007, we repurchased 66 acres of the land we had sold to the 2005 Development/Repositioning Joint Venture for a purchase price of $6,379. Since we had deferred 10% of the gain on sale from the original sale in 2005, we netted the unamortized deferred gain amount, along with our 10% economic interest in the gain on sale and distributions in excess of our 10% economic interest we received from the sale against the basis of the land.

On October 15, 2007, we purchased 10 acres of land from the 2005 Development/Repositioning Joint Venture for a purchase price of $3,714. We netted our 10% economic interest in the gain on sale and distributions in excess of our 10% economic interest we received from the sale against the basis of the land.

During the year ended December 31, 2008, we earned acquisition fees from the 2006 Land/Development Joint Venture. During the year ended December 31, 2007, we earned acquisition fees from the 2006 Land/Development Joint Venture and the July 2007 Fund. During the year ended December 31, 2006, we earned acquisition fees from the 2003 Net Lease Joint Venture, the 2005 Core Joint Venture, the 2006 Net LeaseCo-Investment Program and the July 2007 Fund. We deferred 15% of the acquisition fees earned from the 2003 Net Lease Joint Venture and the 2006 Net Lease Co-Investment Program activity and 10% of the acquisition fees earned from the 2005 Core Joint Venture and the 2006 Land/Development Joint Venture activity. The deferrals reduced our investment in the Joint Ventures and are amortized into income over the life of the underlying properties, generally 25 to 40 years.

At December 31, 2008 and 2007, we have a receivable from the Joint Ventures and the July 2007 Fund of $3,939 and $6,068, respectively, which mainly relates to development, leasing, property management and asset management fees due to us from the Joint Ventures and the July 2007 Fund and reimbursement for development expenditures made by the TRS who is acting in the capacity of the general contractor for development projects for the 2005 Development/Repositioning Joint Venture. These amounts are included in Prepaid Expenses and Other Assets, Net.

During the years ended December 31, 2008, 2007 and 2006, we invested the following amounts in, as well as received distributions from, our Joint Ventures and recognized fees from acquisition, disposition,

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

leasing, development, incentive, property management and asset management services from our Joint Ventures and the July 2007 Fund in the following amounts:

	Year Ended		Year Ended		Year Ended
	December 31,		December 31,		December 31,
	2008		2007		2006
Contributions	$	16,623	$	25,482	$	29,194
Distributions	$	22,505	$	54,228	$	51,398
Fees	$	19,757	$	25,116	$	22,507

The combined summarized financial information of the investments in Joint Ventures is as follows:

	December 31,			December 31,
	2008			2007
Condensed Combined Balance Sheets
Gross Real Estate Investment	$	1,967,717		$	1,777,964
Less: Accumulated Depreciation		(93,215	)		(69,811	)
Net Real Estate		1,874,502			1,708,153
Other Assets		186,881			163,583
Total Assets	$	2,061,383		$	1,871,736
Debt	$	1,442,464		$	1,264,769
Other Liabilities		130,407			112,268
Equity		488,512			494,699
Total Liabilities and Equity	$	2,061,383		$	1,871,736
Consolidated Operating Partnership’s share of Equity	$	56,066		$	56,494
Basis Differentials(1)		(39,767	)		1,049
Carrying Value of the Consolidated Operating Partnership’s investments in Joint Ventures	$	16,299		$	57,543

(1) This amount represents the aggregate difference between our historical cost basis and the basis reflected at the joint venture level. Basis differentials are primarily comprised of impairments we recorded in accordance with APB 18, a gain deferral related to a property we sold to the 2003 Net Lease Joint Venture, deferred fees and certain equity costs which are not reflected at the joint venture level.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

	Year Ended December 31,
Condensed Combined Statements of Operations	2008			2007		2006
Total Revenues	$	91,754		$	85,691	$	71,897
Expenses:
Operating and Other		38,897			28,238		21,951
Interest		55,071			48,345		30,205
Depreciation and Amortization		48,768			45,433		38,539
Impairment Loss		20,208			—		—
Total Expenses		162,944			122,016		90,695
Income from Discontinued Operations (Including Gain on Sale of Real Estate of $33,518, $92,652 and $66,927 for the years ended December 31, 2008, 2007 and 2006, respectively)		34,812			84,998		41,732
Gain on Sale of Real Estate		18,460			15,523		27,425
Net (Loss) Income	$	(17,918	)	$	64,196	$	50,359
Consolidated Operating Partnership’s Share of Net Income		6,661			29,958		30,671
Consolidated Operating Partnership’s Impairment in Accordance with APB 18		(39,839	)		—		—
Equity in (Loss) Income of Joint Ventures	$	(33,178	)	$	29,958	$	30,671

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

7.   Mortgage Loans Payable, Net, Senior Unsecured Notes, Net and Unsecured Line of Credit

The following table discloses certain information regarding our mortgage loans payable, senior unsecured notes and unsecured line of credit:

									Effective
	Outstanding						Interest		Interest
	Balance at						Rate At		Rate at
	December 31,			December 31,			December 31,		December 31,
	2008			2007			2008		2008		Maturity Date
Mortgage Loans Payable, Net	$	77,396		$	73,550		5.50%	- 9.25%	4.58%	- 9.25%		July 2009 - September 2024
Unamortized Premiums		(1,717	)		(2,196	)
Mortgage Loans Payable, Gross	$	75,679		$	71,354
Senior Unsecured Notes, Net
2016 Notes	$	194,524		$	199,442		5.750%		5.91%			01/15/16
2017 Notes		99,914			99,905		7.500%		7.52%			12/01/17
2027 Notes		15,056			15,056		7.150%		7.11%			05/15/27
2028 Notes		199,846			199,838		7.600%		8.13%			07/15/28
2011 Notes		199,868			199,807		7.375%		7.39%			03/15/11
2012 Notes		199,546			199,408		6.875%		6.85%			04/15/12
2032 Notes		49,480			49,457		7.750%		7.87%			04/15/32
2009 Notes		124,980			124,937		5.250%		4.10%			06/15/09
2014 Notes		114,921			113,521		6.420%		6.54%			06/01/14
2011 Exchangeable Notes*		200,000			200,000		4.625%		4.63%			09/15/11
2017 II Notes		118,163			149,620		5.950%		6.37%			05/15/17
Subtotal	$	1,516,298		$	1,550,991
Unamortized Discounts		12,202			14,079
Senior Unsecured Notes, Gross	$	1,528,500		$	1,565,070
Unsecured Line of Credit	$	443,284		$	322,129		1.981%		1.981%			09/28/12

* Holders of the 2011 Exchangeable Notes may exchange their notes for the Company’s common shares prior to the close of business on the second business day immediately preceding the stated maturity date at any time beginning on July 15, 2011 and also under other certain circumstances. The 2011 Exchangeable Notes are convertible into common shares of the Company at a price of $50.93.

Mortgage Loans Payable, Net

On June 6, 2008, we assumed a mortgage loan payable of $4,097 bearing interest at a rate of 6.83%. In conjunction with the assumption of the mortgage loan, we recorded a premium in the amount of $256 which will be amortized as an adjustment to interest expense through maturity on June 1, 2018. On July 24, 2008, we assumed two mortgage loans payable of $2,502 and $997 bearing interest at a rate of 6.97% and 7.07%, respectively, that each mature on July 1, 2018. As of December 31, 2008, mortgage loans payable of $77,396 are collateralized by industrial properties with a carrying value of $156,336. We believe the Operating Partnership and the Company were in compliance with all covenants relating to mortgage loans payable as of December 31, 2008.

Senior Unsecured Notes, Net

On January 10, 2006, we issued $200,000 of senior unsecured debt which matures on January 15, 2016 and bears interest at a rate of 5.75% (the “2016 Notes”). The issue price of the 2016 Notes was 99.653%. In December 2005, we also entered into interest rate protection agreements which were used to fix the interest

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

rate on the 2016 Notes prior to issuance. We settled the interest rate protection agreements on January 9, 2006 for a payment of approximately $1,729, which is included in other comprehensive income.

On June 6, 2008, we repurchased and retired $5,000 of the 2016 Notes at a redemption price of 89.75% of par. In connection with the partial retirement, we recognized $430 as gain on early retirement of debt, which is the difference between the repurchase amount of $4,488 and the principal amount retired of $5,000, net of the pro rata write off of the unamortized debt issue discount, the unamortized loan fees and the unamortized settlement amount of the interest rate protection agreements related to the 2016 Notes of $13, $36 and $33, respectively.

On May 7, 2007, we issued $150,000 of senior unsecured debt which matures on May 15, 2017 and bears interest at a rate of 5.95% (the “2017 II Notes”). The issue price of the 2017 II Notes was 99.730%. In April 2006, we also entered into interest rate protection agreements to fix the interest rate on the 2017 II Notes prior to issuance. We settled the effective portion of the interest rate protection agreements on May 1, 2007 for $4,261 which is included in other comprehensive income.

On June 6, 2008, we repurchased and retired $16,570 of the 2017 II Notes at a redemption price of 89.750% of par. In connection with the partial retirement, we recognized $1,059 as gain on early retirement of debt, which is the difference between the repurchase amount of $14,872 and the principal amount retired of $16,570, net of the pro rata write off of the unamortized debt issue discount, the unamortized loan fees and the unamortized settlement amount of the interest rate protection agreements related to the 2017 II Notes of $40, $177 and $422, respectively. On July 1, 2008, we repurchased and retired $5,000 of the 2017 II Notes at a redemption price of 88.915% of par. In connection with the partial retirement, we recognized $363 as gain on early retirement of debt, which is the difference between the repurchase amount of $4,446 and the principal amount retired of $5,000, net of the pro rata write off of the unamortized debt issue discount, the unamortized loan fees, and the unamortized settlement amount of the interest rate protection agreements related to the 2017 II Notes of $12, $53 and $126, respectively. On August 12, 2008, we repurchased and retired $10,000 of the 2017 II Notes at a redemption price of 87.200% of par. In connection with the partial retirement, we recognized $897 as gain on early retirement of debt, which is the difference between the repurchase amount of $8,720 and the principal amount retired of $10,000, net of the pro rata write off of the unamortized debt issue discount, the unamortized loan fees, and the unamortized settlement amount of the interest rate protection agreements related to the 2017 II Notes of $24, $109 and $250, respectively.

In conjunction with certain issuances of senior unsecured debt, we entered into interest rate protection agreements to fix the interest rate on anticipated offerings of senior unsecured debt. In the next 12 months, we will amortize approximately $97 into net income by decreasing interest expense.

All of our senior unsecured debt (except for the 2011 Exchangeable Notes) contains certain covenants, including limitations on incurrence of debt and debt service coverage. Management believes that the Operating Partnership and the Company were in compliance with all covenants relating to senior unsecured debt as of December 31, 2008. However, these financial covenants are complex and there can be no assurance that these provisions would not be interpreted by our noteholders in a manner that could impose and cause us to incur material costs.

Unsecured Line of Credit

We have maintained our Unsecured Line of Credit since 1997. The Unsecured Line of Credit matures on September 28, 2012, has a borrowing capacity of $500,000 (with the right, subject to certain conditions, to increase the borrowing capacity up to $700,000) and bears interest at a floating rate of LIBOR plus 0.75%, or the prime rate, at our election. At December 31, 2008, borrowings under the Unsecured Line of Credit bore interest at a weighted average interest rate of 1.981%. On August 18, 2008 we amended our unsecured line of credit agreement dated as of September 28, 2007. As a result of the amendment, the portion of the Unsecured

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Line of Credit available in multiple currencies was increased to $161,000 from $100,000. The Unsecured Line of Credit contains certain covenants including limitations on incurrence of debt and debt service coverage. Under the Unsecured Line of Credit, an event of default can also occur if the lenders, in their good faith judgment, determine that a material adverse change has occurred which could prevent timely repayment or materially impair our ability to perform our obligations under the loan agreement. We believe that the Operating Partnership and the Company were in compliance with all covenants relating to the Unsecured Line of Credit as of December 31, 2008. However, these financial covenants are complex and there can be no assurance that these provisions would not be interpreted by our lenders in a manner that could impose and cause us to incur material costs.

The following is a schedule of the stated maturities and scheduled principal payments of the mortgage loans payable, senior unsecured debt and unsecured line of credit, exclusive of premiums and discounts, for the next five years ending December 31 and thereafter:

	Amount
2009	$	133,297
2010		15,815
2011		407,657
2012		648,059
2013		2,523
Thereafter		840,112
Total	$	2,047,463

Fair Value

At December 31, 2008 and 2007, the fair value of our mortgage loans payable, senior unsecured notes and Unsecured Line of Credit were as follows:

	December 31, 2008				December 31, 2007
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Mortgage Loans Payable	$	77,396	$	75,817	$	73,550	$	74,867
Senior Unsecured Debt		1,516,298		1,033,283		1,550,991		1,605,048
Unsecured Line of Credit		443,284		400,849		322,129		322,129
Total	$	2,036,978	$	1,509,949	$	1,946,670	$	2,002,044

The fair value of the senior unsecured notes was determined by quoted market prices, if available. The fair values of our senior unsecured notes that were not valued by quoted market prices and the fair values of our mortgage loans payable were determined by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities.

The fair value of the Unsecured Line of Credit was determined by discounting the future cash flows using current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining term, assuming no repayment until maturity.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

8.   Partners’ Capital

We have issued general partnership units and limited partnership units and preferred general partnership units. The general partnership units resulted from capital contributions from the Company. The limited partnership units are issued in conjunction with the acquisition of certain properties (see discussion below). Subject tolock-up periods and certain adjustments, limited partnership units are convertible into common stock, $.01 par value, of the Company on a one-for-one basis or cash at the option of the Company. The preferred general partnership units result from preferred capital contributions from the Company. The preferred general partnership units had an aggregate liquidation priority of $275,000 as of December 31, 2008 and 2007, respectively. We are required to make all required distributions on the preferred general partnership units prior to any distribution of cash or assets to the holders of the Units. The consent of the holder of the limited partnership units is required to alter such holder’s rights as to allocations and distributions, to alter or modify such holder’s rights with respect to redemption, to cause the early termination of the Consolidated Operating Partnership, or to amend the provisions of the partnership agreement which requires such consent.

Unit Contributions

For the year ended December 31, 2006, we issued 31,473 Limited Partner Units valued, in the aggregate, at $1,288 in exchange for interests in certain properties. These contributions are reflected in our financial statements as limited partner contributions.

For the year ended December 31, 2006, certain employees and directors of the Company exercised 125,780 non-qualified employee stock options. Net proceeds to the Company approximated $3,742. The gross proceeds from the option exercises were contributed to us in exchange for Units and are reflected in our financial statements as a general partner contribution.

For the year ended December 31, 2007, certain employees of the Company exercised 19,600 non-qualified employee stock options. Net proceeds to the Company approximated $613. The gross proceeds from the option exercises were contributed to us in exchange for Units and are reflected in our financial statements as a general partner contribution.

For the year ended December 31, 2008, certain employees of the Company exercised 6,300 non-qualified employee stock options. Net proceeds to the Company approximated $174. The gross proceeds from the option exercises were contributed to us in exchange for Units and are reflected in our financial statements as a general partner contribution.

During the years ended December 31, 2008, 2007 and 2006 the Company awarded 583,871, 442,008 and 303,142 restricted shares of common stock, respectively, as well as 4,757, 0, and 0 restricted stock units, respectively, to certain employees of the Company and 21,945, 17,139, and 16,232 restricted shares of common stock, respectively, to certain directors of the Company. We issued General Partner Units to the Company in the same amount. See Note 16 for further disclosure on our stock-based compensation.

Treasury Stock

In March 2000 and in September 2007, the Company’s Board of Directors authorized a stock repurchase plan pursuant to which the Company is permitted to purchase up to $100,000 (the “March 2000 Program”) and $100,000, respectively, of its outstanding common stock. The Company may make purchases from time to time in the open market or in privately negotiated transactions, depending on market and business conditions. During the year ended December 31, 2007, the Company repurchased 1,797,714 shares at an average price per share of $38.62, including brokerage commissions. We purchased general partner units from the Company in the same amount. During November 2007 we completed the March 2000 Program.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table is a roll-forward of the General Partnership and Limited Partnership Units outstanding, including unvested general partner restricted units, for the three years ended December 31, 2008:

	General Partnership and
	Limited Partnership
	Units Outstanding
Balance at December 31, 2005		51,185,452
Issuance of General Partner Units		125,780
Issuance of General Partner Restricted Units		319,374
Repurchase and Retirement of Restricted Units		(93,007	)
Issuance of Limited Partner Units		31,473
Balance at December 31, 2006		51,569,072
Issuance of General Partner Units		19,600
Issuance of General Partner Restricted Units		459,147
Repurchase and Retirement of Restricted Units		(1,797,714	)
Issuance of Limited Partner Units		(139,261	)
Balance at December 31, 2007		50,110,844
Issuance of General Partner Units		6,438
Issuance of General Partner Restricted Units		605,816
Repurchase and Retirement of Restricted Units		(264,713	)
Balance at December 31, 2008		50,458,385

Preferred Contributions:

On June 6, 1997, the Company issued 2,000,000 Depositary Shares, each representing 1/100th of a share of the Company’s 85/8%, $.01 par value, Series C Cumulative Preferred Stock (the “Series C Preferred Stock”), at an initial offering price of $25.00 per Depositary Share. The net proceeds of $47,997 received from the Series C Preferred Stock were contributed to us in exchange for 85/8% Series C Cumulative Preferred Units (the “Series C Preferred Units”) and are reflected in our financial statements as a general partner preferred unit contribution. On June 6, 2007, the Series C Preferred Stock became redeemable for cash at the option of the Company, in whole or in part, at a redemption price equivalent to $25.00 per Depositary Share, or $50,000 in the aggregate, plus dividends accrued and unpaid to the redemption date. The Company redeemed the Series C Preferred Stock on June 7, 2007, at a redemption price of $25.00 per Depositary Share, and paid a prorated second quarter dividend of $0.40729 per Depositary Share, totaling approximately $815. The Series C Preferred Units were redeemed on June 7, 2007 as well. Due to the redemption of the Series C Preferred Units, the initial offering costs associated with the issuance of the Series C Preferred Units of $2,017 were reflected as a deduction from net income to arrive at net income available to unitholders in determining earnings per unit for the year ended December 31, 2007.

On May 27, 2004, the Company issued 50,000 Depositary Shares, each representing 1/100th of a share of the Company’s 6.236%, $.01 par value, Series F Flexible Cumulative Redeemable Preferred Stock (the “Series F Preferred Stock”), at an initial offering price of $1,000.00 per Depositary Share for gross proceeds of $50,000. Net of offering costs, the Company received net proceeds of $49,075 from the issuance of the Series F Preferred Stock which were contributed to us in exchange for 6.236% Series F Cumulative Preferred Units (the “Series F Preferred Units”) and are reflected in our financial statements as a general partner preferred unit contribution. Dividends on the Series F Preferred Stock are cumulative from the date of initial issuance and are payable semi-annually in arrears for the period from the date of original issuance through

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

March 31, 2009 (the “Series F Initial Fixed Rate Period”), commencing on September 30, 2004, at a rate of 6.236% per annum of the liquidation preference (the “Series F Initial Distribution Rate”) (equivalent to $62.36 per Depositary Share). On or after March 31, 2009, the Series F Initial Distribution Rate is subject to reset, at the Company’s option, subject to certain conditions and parameters, at fixed or floating rates and periods. Fixed rates and periods will be determined through a remarketing procedure. Floating rates during floating rate periods will equal 2.375% (the initial credit spread), plus the greater of (i) the3-month LIBOR Rate, (ii) the10-year Treasury CMT Rate (as defined in the Articles Supplementary), and (iii) the30-year Treasury CMT Rate (the adjustable rate)(as defined in the Articles Supplementary), reset quarterly. Dividends on the Series F Preferred Stock are payable semi-annually in arrears for fixed rate periods subsequent to the Series F Initial Fixed Rate Period and quarterly in arrears for floating rate periods. With respect to the payment of dividends and amounts upon liquidation, dissolution or winding up, the Series F Preferred Stock ranks senior to payments on the Company’s Common Stock and pari passu with the Company’s Series G Preferred Stock (hereinafter defined), Series J Preferred Stock (hereinafter defined) and Series K Preferred Stock (hereinafter defined). On or after March 31, 2009, subject to any conditions on redemption applicable in any fixed rate period subsequent to the Series F Initial Fixed Rate Period, the Series F Preferred Stock is redeemable for cash at the option of the Company, in whole or in part, at a redemption price equivalent to $1,000.00 per Depositary Share, or $50,000 in the aggregate, plus dividends accrued and unpaid to the redemption date. The Series F Preferred Stock has no stated maturity and is not convertible into any other securities of the Company. In October 2008 we entered into an interest rate swap agreement with a notional value of $50,000 to mitigate our exposure to floating interest rates related to the Series F Preferred Stock. See Note 17 for further information on the agreement.

On May 27, 2004, the Company issued 25,000 Depositary Shares, each representing 1/100th of a share of the Company’s 7.236%, $.01 par value, Series G Flexible Cumulative Redeemable Preferred Stock (the “Series G Preferred Stock”), at an initial offering price of $1,000.00 per Depositary Share for gross proceeds of $25,000. Net of offering costs, the Company received net proceeds of $24,512 from the issuance of the Series G Preferred Stock which were contributed to us in exchange for 7.236% Series G Cumulative Preferred Units (the “Series G Preferred Units”) and are reflected in our financial statements as a general partner preferred unit contribution. Dividends on the Series G Preferred Stock are cumulative from the date of initial issuance and are payable semi-annually in arrears for the period from the date of original issuance of the Series G Preferred Stock through March 31, 2014 (the “Series G Initial Fixed Rate Period”), commencing on September 30, 2004, at a rate of 7.236% per annum of the liquidation preference (the “Series G Initial Distribution Rate”) (equivalent to $72.36 per Depositary Share). On or after March 31, 2014, the Series G Initial Distribution Rate is subject to reset, at the Company’s option, subject to certain conditions and parameters, at fixed or floating rates and periods. Fixed rates and periods will be determined through a remarketing procedure. Floating rates during floating rate periods will equal 2.500% (the initial credit spread), plus the greater of (i) the3-month LIBOR Rate, (ii) the10-year Treasury CMT Rate (as defined in the Articles Supplementary), and (iii) the30-year Treasury CMT Rate (the adjustable rate)(as defined in the Articles Supplementary), reset quarterly. Dividends on the Series G Preferred Stock are payable semi-annually in arrears for fixed rate periods subsequent to the Series G Initial Fixed Rate Period and quarterly in arrears for floating rate periods. With respect to the payment of dividends and amounts upon liquidation, dissolution or winding up, the Series G Preferred Stock ranks senior to payments on the Company’s Common Stock and pari passu with the Company’s Series F Preferred Stock, Series J Preferred Stock (hereinafter defined) and Series K Preferred Stock (hereinafter defined). On or after March 31, 2014, subject to any conditions on redemption applicable in any fixed rate period subsequent to the Series G Initial Fixed Rate Period, the Series G Preferred Stock is redeemable for cash at the option of the Company, in whole or in part, at a redemption price equivalent to $1,000.00 per Depositary Share, or $25,000 in the aggregate, plus dividends accrued and unpaid to the redemption date. The Series G Preferred Stock has no stated maturity and is not convertible into any other securities of the Company.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

On November 8, 2005 and November 18, 2005, the Company issued 600 and 150 Shares, respectively, of $.01 par value, Series I Flexible Cumulative Redeemable Preferred Stock, (the “Series I Preferred Stock”), in a private placement at an initial offering price of $250,000 per share for an aggregate initial offering price of $187,500. Net of offering costs, the Company received net proceeds of $181,484 from the issuance of Series I Preferred Stock which were contributed to us in exchange for Series I Cumulative Preferred Units (the “Series I Preferred Units”). The Company redeemed the Series I Preferred Stock on January 13, 2006 for $242,875.00 per share, and paid a prorated first quarter dividend of $470.667 per share, totaling approximately $353. We redeemed the Series I Preferred Units as well. In accordance with EITF D-42, due to the redemption of the Series I Preferred Units, the difference between the redemption cost and the carrying value of the Series I Preferred Units of approximately $672 is reflected as a deduction from net income to arrive at net income available to Unitholders in determining earnings per unit for the year ended December 31, 2006.

On January 13, 2006, the Company issued 6,000,000 Depositary Shares, each representing 1/10,000th of a share of the Company’s 7.25%, $.01 par value, Series J Cumulative Redeemable Preferred Stock (the “Series J Preferred Stock”), at an initial offering price of $25.00 per Depositary Share. The net proceeds from the issuance of the Series J Preferred Stock were contributed to us in exchange for Series J Cumulative Preferred Units (the “Series J Preferred Units”) and are reflected in our financial statements as a general partner preferred unit contribution. Dividends on the Series J Preferred Stock, represented by the Depositary Shares, are cumulative from the date of initial issuance and are payable quarterly in arrears. However, during any period that both (i) the depositary shares are not listed on the NYSE or AMEX, or quoted on NASDAQ, and (ii) the Company is not subject to the reporting requirements of the Exchange Act, but the preferred shares are outstanding, the Company will increase the dividend on the preferred shares to a rate of 8.25% of the liquidation preference per year. However, if at any time both (i) the depositary shares cease to be listed on the NYSE or the AMEX, or quoted on NASDAQ, and (ii) the Company ceases to be subject to the reporting requirements of the Exchange Act, but the preferred shares are outstanding, then the preferred shares will be redeemable, in whole but not in part at the Company’s option, within 90 days of the date upon which the depositary shares cease to be listed and the Company ceases to be subject to such reporting requirements, at a redemption price equivalent to $25.00 per Depositary Share, plus all accrued and unpaid dividends to the date of redemption. With respect to the payment of dividends and amounts upon liquidation, dissolution or winding up, the Series J Preferred Stock ranks senior to payments on the Company’s Common Stock and pari passu with the Company’s Series F Preferred Stock, Series G Preferred Stock and Series K Preferred Stock (hereinafter defined). The Series J Preferred Stock is not redeemable prior to January 15, 2011. On or after January 15, 2011, the Series J Preferred Stock is redeemable for cash at the option of the Company, in whole or in part, at a redemption price equivalent to $25.00 per Depositary Share, or $150,000 in the aggregate, plus dividends accrued and unpaid to the redemption date. The Series J Preferred Stock has no stated maturity and is not convertible into any other securities of the Company.

On August 21, 2006, the Company issued 2,000,000 Depositary Shares, each representing 1/10,000th of a share of the Company’s 7.25%, $.01 par value, Series K Flexible Cumulative Redeemable Preferred Stock (the “Series K Preferred Stock”), at an initial offering price of $25.00 per Depositary Share. The net proceeds from the issuance of the Series K Preferred Stock were contributed to the Operating Partnership in exchange for Series K Cumulative Preferred Units (the “Series K Preferred Units”) and are reflected in the Consolidated Operating Partnership’s financial statements as a general partner preferred unit contribution. Dividends on the Series K Preferred Stock, represented by the Depositary Shares, are cumulative from the date of initial issuance and are payable quarterly in arrears. With respect to the payment of dividends and amounts upon liquidation, dissolution or winding up, the Series K Preferred Stock ranks senior to payments on the Company’s Common Stock and pari passu with the Company’s Series F Preferred Stock, Series G Preferred Stock and Series J Preferred Stock. The Series K Preferred Stock is not redeemable prior to August 15, 2011. On or after August 15, 2011, the Series K Preferred Stock is redeemable for cash at the option of the Company, in whole or in part, at a redemption price equivalent to $25.00 per Depositary Share, or $50,000 in

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

the aggregate, plus dividends accrued and unpaid to the redemption date. The Series K Preferred Stock has no stated maturity and is not convertible into any other securities of the Company.

Distributions

The following table summarizes distributions declared for the past three years:

	Year Ended 2008				Year Ended 2007				Year Ended 2006
	Distribution		Total		Distribution		Total		Distribution		Total
	per Unit		Distribution		per Unit		Distribution		per Unit		Distribution
General Partner/Limited Partner Units	$	2.4100	$	121,882	$	2.8500	$	146,126	$	2.8100	$	144,720
Series C Preferred Units	$	—	$	—	$	94.6353	$	1,893	$	215.6240	$	4,313
Series F Preferred Units	$	6,236.0000	$	3,118	$	6,236.0000	$	3,118	$	6,236.0000	$	3,118
Series G Preferred Units	$	7,236.0000	$	1,809	$	7,236.0000	$	1,809	$	7,236.0000	$	1,809
Series I Preferred Units	$	—	$	—	$	—	$	—	$	470.6667	$	353
Series J Preferred Units	$	18,125.2000	$	10,875	$	18,125.2000	$	10,875	$	17,521.0000	$	10,512
Series K Preferred Units	$	18,125.2000	$	3,625	$	18,125.2000	$	3,625	$	6,595.6000	$	1,319

9.   Acquisition and Development of Real Estate

In 2006, we acquired 79 industrial properties comprising, in the aggregate, approximately 9.7 million square feet of GLA and several land parcels for a total purchase price of approximately $563,431, excluding costs incurred in conjunction with the acquisition of properties. We also substantially completed development of 15 properties comprising approximately 5.0 million square feet of GLA at a cost of approximately $188,592. We reclassed the costs of substantially completed developments from construction in progress to building, tenant improvements and leasing commissions.

In 2007, we acquired 103 industrial properties comprising, in the aggregate, approximately 8.0 million square feet of GLA and several land parcels, including 41 industrial properties comprising approximately 1.3 million square feet of GLA in connection with the purchase of the 90% equity interest from the institutional investor of the 1998 Core Joint Venture and one industrial property comprising 0.3 million square feet of GLA in connection with the redemption of the 85% equity interest in one property from the institutional investor in the 2003 Net Lease Joint Venture. The purchase price of these acquisitions totaled approximately $431,490, excluding costs incurred in conjunction with the acquisition of the industrial properties and land parcels. We also substantially completed development of 14 properties comprising approximately 3.4 million square feet of GLA at a cost of approximately $134,050. We reclassed the costs of the substantially completed developments from construction in progress to building, tenant improvements and leasing commissions.

In 2008, we acquired 23 industrial properties comprising, in the aggregate, approximately 2.9 million square feet of GLA and several land parcels for a total purchase price of approximately $295,759, excluding costs incurred in conjunction with the acquisition of properties. We also substantially completed development of eight properties comprising approximately 4.5 million square feet of GLA at a cost of approximately $148,236. We reclassed the costs of substantially completed developments from construction in progress to building, tenant improvements and leasing commissions.

Intangible Assets Subject To Amortization in the Period of Acquisition

The fair value of in-place leases, above market leases, tenant relationships, and below market leases recorded as a result of the above acquisitions is $21,164, $1,000, $8,977, and $(7,327), respectively, for the year ended December 31, 2007. The weighted average life in months of in-place leases, above market leases,

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

tenant relationships, and below market leases recorded as a result of 2007 acquisitions was 79, 99, 114, and 139 months, respectively.

The fair value of in-place leases, above market leases, tenant relationships, and below market leases recorded as a result of the above acquisitions is $18,422, $61, $6,962, and $(7,012), respectively, for the year ended December 31, 2008. The weighted average life in months of in-place leases, above market leases, tenant relationships, and below market leases recorded as a result of 2008 acquisitions was 100, 43, 100, and 138 months, respectively.

10.   Sale of Real Estate, Real Estate Held for Sale and Discontinued Operations

In 2006, we sold 109 industrial properties comprising approximately 16.0 million square feet of GLA and several land parcels, totaling gross proceeds of $895,024. The gain on sale of real estate was approximately $202,817, of which $196,622 is shown in discontinued operations. The 109 sold industrial properties meet the criteria established by SFAS 144 to be included in discontinued operations. Therefore, in accordance with SFAS 144, the results of operations and gain on sale of real estate, net of income taxes, for the 109 sold industrial properties are included in discontinued operations. The results of operations and gain on sale of real estate, net of income taxes, for several land parcels that do not meet the criteria established by SFAS 144 are included in continuing operations.

In 2007, we sold 159 industrial properties comprising approximately 13.1 million square feet of GLA and several land parcels. Gross proceeds from the sales of the 159 industrial properties and several land parcels were approximately $840,402. The gain on sale of real estate was approximately $245,247, of which $237,368 is shown in discontinued operations. One hundred fifty-six of the 159 sold industrial properties meet the criteria established by SFAS 144 to be included in discontinued operations. Therefore, in accordance with SFAS 144, the results of operations and gain on sale of real estate, net of income taxes, for the 156 sold industrial properties that meet the criteria established by SFAS 144 are included in discontinued operations. The results of operations and gain on sale of real estate, net of income taxes, for the three industrial properties and several land parcels that do not meet the criteria established by SFAS 144 are included in continuing operations.

In 2008, we sold 89 industrial properties comprising approximately 7.4 million square feet of GLA and several land parcels. Gross proceeds from the sales of the 89 industrial properties and several land parcels were approximately $469,508. The gain on sale of real estate was approximately $148,445, of which $136,384 is shown in discontinued operations. Eighty-eight of the 89 sold industrial properties meet the criteria established by SFAS 144 to be included in discontinued operations. Therefore, in accordance with SFAS 144, the results of operations and gain on sale of real estate, net of income taxes, for the 88 sold industrial properties that meet the criteria established by SFAS 144 are included in discontinued operations. The results of operations and gain on sale of real estate, net of income taxes, for the one industrial property and several land parcels that do not meet the criteria established by SFAS 144 are included in continuing operations.

At December 31, 2008, we had six industrial properties comprising approximately 0.4 million square feet of GLA and certain land parcels held for sale. In accordance with SFAS 144, the results of operations of the six industrial properties held for sale at December 31, 2008 are included in discontinued operations. There can be no assurance that such industrial properties held for sale will be sold.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table discloses certain information regarding the industrial properties included in our discontinued operations for the years ended December 31, 2008, 2007 and 2006.

	Year Ended			Year Ended			Year Ended
	December 31,			December 31,			December 31,
	2008			2007			2006
Total Revenues	$	22,907		$	81,020		$	114,319
Property Expenses		(8,360	)		(27,553	)		(37,726	)
Depreciation and Amortization		(5,573	)		(25,382	)		(40,204	)
Gain on Sale of Real Estate		136,384			237,368			196,622
Provision for Income Taxes		(4,188	)		(38,126	)		(51,155	)
Income from Discontinued Operations	$	141,170		$	227,327		$	181,856

At December 31, 2008 and 2007, we had mortgage notes receivables outstanding of approximately $34,532 and $30,317, respectively, in conjunction with certain property sales that we provided seller financing, which is included as a component of Prepaid Expenses and Other Assets, Net, At December 31, 2008 and 2007, the fair value of those mortgage notes receivables were $28,081 and $30,251, respectively.

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

11.   Supplemental Information to Statements of Cash Flows

	Year Ended			Year Ended			Year Ended
	December 31,			December 31,			December 31,
	2008			2007			2006
Interest paid, net of capitalized interest	$	113,062		$	118,909		$	114,681
Capitalized Interest	$	7,775		$	8,413		$	5,063
Income Taxes Paid	$	2,355		$	42,169		$	36,374
Supplemental schedule of noncash investing and financing activities:
Distribution payable on general and limited partner units	$	12,614		$	36,079		$	36,613
Distribution payable on preferred units	$	1,232		$	1,232		$	5,935
Exchange of Limited partnership units for General partnership units:
Limited partnership units	$	(14,616	)	$	(2,858	)	$	(5,144	)
General partnership units		14,616			2,858			5,144
	$	—		$	—		$	—
In conjunction with property and land acquisitions, the following assets and liabilities were assumed:
Accounts payable and accrued expenses	$	(376	)	$	(5,987	)	$	(1,284	)
Issuance of Operating Partnership Units	$	—		$	—		$	(1,288	)
Mortgage debt	$	(7,852	)	$	(38,590	)	$	(33,982	)
Write off of fully depreciated assets	$	64,185		$	39,804		$	25,655
In conjunction with certain property sales, we provided seller financing or assigned a mortgage loan payable:
Notes receivable	$	46,734		$	48,282		$	11,200
Mortgage note payable	$	—		$	769		$	—

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FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

12.   Earnings Per Unit (“EPU”)

The computation of basic and diluted EPU is presented below:

	Year Ended			Year Ended			Year Ended
	December 31,			December 31,			December 31,
	2008			2007			2006
Numerator:
Loss from Continuing Operations	$	(104,101	)	$	(58,245	)	$	(59,962	)
Gain on Sale of Real Estate		12,061			7,879			6,195
Less: Provision for Income Taxes Allocable to Gain on Sale of Real Estate		(3,782	)		(3,082	)		(2,119	)
Less: Preferred Unit Distributions		(19,428	)		(21,320	)		(21,424	)
Less: Redemption of Preferred Units		—			(2,017	)		(672	)
Loss from Continuing Operations Available to Unitholders, Net of Income Taxes — For Basic and Diluted EPU		(115,250	)		(76,785	)		(77,982	)
Income from Discontinued Operations		145,358			265,453			233,011
Less: Provision for Income Taxes Allocable to Discontinued Operations		(4,188	)		(38,126	)		(51,155	)
Net Income Available to Unitholders — For Basic and Diluted EPU	$	25,920		$	150,542		$	103,874
Denominator:
Weighted Average Units Outstanding — Basic and Diluted		49,456,067			50,597,150			50,703,004
Basic and Diluted EPU:
Loss from Continuing Operations Available to Unitholders, Net of Income Taxes	$	(2.33	)	$	(1.52	)	$	(1.54	)
Discontinued Operations, Net of Income Tax	$	2.85		$	4.49		$	3.59
Net Income Available to Unitholders	$	0.52		$	2.98		$	2.05

The number of weighted average units — diluted is the same as the number of weighted average units — basic for the years ended December 31, 2008, 2007 and 2006 as the dilutive effect of stock options and restricted stock/Units was excluded as its inclusion would have been antidilutive to the loss from continuing operations available to unitholders, net of income taxes. The dilutive effect of stock options and restricted stock/Units excluded from the computation are 0 and 976, respectively, for the year ended December 31, 2008, 90,386 and 73,837, respectively, for the year ended December 31, 2007, and 116,155 and 93,643, respectively, for the year ended December 31, 2006.

Unvested restricted stock/Units of 761,660, 909,966 and 778,535 were outstanding as of December 31, 2008, 2007 and 2006, respectively. Unvested restricted stock/Units aggregating 757,390, 470,009 and 109,517 were antidilutive at December 31, 2008, 2007 and 2006, respectively, as the issue price of these shares was higher than the Company’s average stock price during the respective periods and accordingly was excluded from dilution computations.

Additionally, options to purchase common stock of 278,601, 355,901 and 381,976 were outstanding as of December 31, 2008, 2007 and 2006, respectively. Options to purchase common stock of 278,601 were antidilutive at December 31, 2008, as the strike price of these stock options was higher than the Company’s average stock price during the respective periods and accordingly was excluded from dilution computations. In 2007 and 2006, all of the stock options were dilutive.

82

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The $200,000 of senior unsecured debt (the “2011 Exchangeable Notes”) issued during 2006, which are convertible into common shares of the Company at a price of $50.93, were not included in the computation of diluted EPU as the Company’s average stock price did not exceed the strike price of the conversion feature.

13.   Income Taxes

The components of income tax benefit (expense) for the TRS for the years ended December 31, 2008, 2007 and 2006 are comprised of the following:

	2008			2007			2006
Current:
Federal	$	5,114		$	(28,209	)	$	(39,531	)
State		814			(4,934	)		(7,734	)
Foreign		(649	)		—			—
Deferred:
Federal		(526	)		3,977			3,548
State		(107	)		571			695
Foreign		671			—			—
	$	5,317		$	(28,595	)	$	(43,022	)

In addition to the income tax benefit (expense) recognized by the TRS, $1,028, $1,952 and $317 of state income tax expense was recognized by us and is included in income tax expense on our consolidated statement of operations for the years ended December 31, 2008, 2007, and 2006, respectively.

83

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Deferred income taxes represent the tax effect of the temporary differences between the book and tax basis of assets and liabilities. Deferred tax assets (liabilities) of the TRS include the following as of December 31, 2008 and 2007:

	2008			2007
Bad debt expense	$	196		$	32
Investment in Joint Ventures		19,621			2,677
Fixed assets		9,625			8,204
Prepaid rent		494			215
Capitalized general and administrative expense under 263A		3,711			2,671
Deferred losses/gains		71			905
Capitalized interest under 263A		—			613
Accrued contingency loss		377			289
Restricted stock		2,326			2,744
Accrual for Restructuring Costs		751			—
Abandoned Project Costs		1,150			—
State net operating loss carry forward		131			—
Valuation Allowance		(19,501	)		—
Other		836			—
Total deferred tax assets	$	19,788		$	18,350
Straight-line rent		(1,936	)		(967	)
Build to suit development		—			(97	)
Fixed assets		(53	)		(130	)
Capitalized Interest under 263(A)		(362	)		—
Other		(243	)		—
Total deferred tax liabilities	$	(2,594	)	$	(1,194	)
Total net deferred tax asset	$	17,194		$	17,156

As of December 31, 2008 and 2007, the TRS had net deferred tax assets of $17,194 and $17,156, after valuation allowances of $19,501 and $0, respectively. Included in net income for the TRS for the year ended December 31, 2008 is $39,073 of impairment loss in Equity in Income of Joint Ventures recorded in accordance with APB 18 and SFAS 144. We recorded a valuation allowance to offset the deferred tax asset that was created by these impairments during the year ended December 31, 2008. We believe that it is more likely than not the results of future operations of the TRS will generate sufficient taxable income to recognize the net deferred tax asset. These future operations are dependent upon the TRS’s profitability, the timing and amounts of gains on property sales and other factors affecting the results of operations of the TRS.

The TRS has a net operating loss carryforward related to state taxes of $131 at December 31, 2008. The TRS does not have any tax credit carryforwards.

84

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The TRS’s components of income tax benefit (expense) for the years ended December 31, 2008, 2007 and 2006 are as follows:

	2008			2007			2006
Tax expense associated with income from operations on sold properties which is included in discontinued operations	$	(456	)	$	(2,094	)	$	(3,644	)
Tax expense associated with gains and losses on the sale of real estate which is included in discontinued operations		(3,732	)		(36,032	)		(47,511	)
Tax expense associated with gains and losses on the sale of real estate		(3,782	)		(3,082	)		(2,119	)
Income tax benefit		13,287			12,613			10,252
Income tax benefit (expense)	$	5,317		$	(28,595	)	$	(43,022	)

The income tax benefit (expense) pertaining to income from continuing operations and gain on sale of real estate for the TRS differs from the amounts computed by applying the applicable federal statutory tax rate to income as follows:

	2008			2007			2006
Tax benefit at federal rate related to continuing operations	$	27,751		$	8,174		$	6,771
State tax benefit, net of federal benefit		2,734			1,006			808
Non-deductible permanent items		(1,852	)		(121	)		(24	)
Prior year provision to return adjustments		7			436			484
Change in Valuation Allowance		(19,501	)		—			—
Foreign Taxes, net		337			—			—
Other		29			36			94
Net income tax benefit	$	9,505		$	9,531		$	8,133

We adopted FASB Interpretation No. 48,“Accounting for Uncertainty in Income Taxes” (“FIN 48”), on January 1, 2007. The adoption of FIN 48 had no effect on our financial statements as we had no unrecognized tax benefits. As of the adoption date, we had paid approximately $1,400 (representing taxes and interest) to the State of Michigan regarding business loss carryforwards for which we are currently litigating. That amount will favorably affect our effective income tax rate in future periods should we prevail.

On December 11, 2007, the Michigan Court of Claims rendered a decision against us regarding the business loss carryforwards. Also, the court ruled against us on an alternative position involving Michigan’s Capital Acquisition Deduction. We filed an appeal to the Michigan Appeals Court in January 2008. However, as a result of the lower court’s decision, $750 was accrued for both tax and financial statement purposes; therefore, there is no unrecognized tax benefit related to this issue.

We had no unrecognized tax benefits as of December 31, 2008 and 2007. To the extent we have unrecognized tax benefits in the future, it will be our policy to recognize interest and penalties related to unrecognized tax benefits in income tax expense.

14.   Restructuring Costs

During the three months ended December 31, 2008 the Compensation Committee of the Board of Directors committed the Company to a plan to reduce organizational and overhead costs. As a result of the plan we recorded as reorganization costs, a pre-tax charge of $26,711 to provide for employee severance and benefits ($24,825), costs associated with the termination of certain office leases ($1,162) and contract cancellation and other costs ($724) associated with implementing the restructuring plan for the year ended

85

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

December 31, 2008. Included in employee severance costs is $9,585 of non-cash costs which represents the accelerated recognition of restricted stock for certain employees. At December 31, 2008 the Company has $6,695 included in Accounts Payable and Accrued Expenses related to severance obligations, remaining lease payments and other costs incurred but not yet paid. See Note 20.

15.   Future Rental Revenues

Our properties are leased to tenants under net andsemi-net operating leases. Minimum lease payments receivable, excluding tenant reimbursements of expenses, under non-cancelable operating leases in effect as of December 31, 2008 are approximately as follows:

2009	$	218,253
2010		182,767
2011		142,348
2012		110,840
2013		84,749
Thereafter		391,970
Total	$	1,130,927

16.   Stock Based Compensation

We maintain three stock incentive plans, (the “Stock Incentive Plans”) which are administered by our Compensation Committee of the Board of Directors. There are approximately 10.0 million shares reserved under the Stock Incentive Plans. Only officers, certain employees, its Independent Directors and its affiliates generally are eligible to participate in the Stock Incentive Plans.

The Stock Incentive Plans authorize (i) the grant of stock options that qualify as incentive stock options under Section 422 of the Code, (ii) the grant of stock options that do not so qualify, (iii) restricted stock/Unit awards, (iv) performance share awards and (v) dividend equivalent rights. The exercise price of stock options is determined by the Compensation Committee. Special provisions apply to awards granted under the Stock Incentive Plans in the event of a change in control in the Consolidated Operating Partnership. As of December 31, 2008, stock options and restricted stock/Units covering 1.0 million shares were outstanding and 1.3 million shares were available under the Stock Incentive Plans. At December 31, 2008, all outstanding stock options are vested. Stock option transactions are summarized as follows:

				Weighted
				Average		Exercise		Aggregate
				Exercise		Price		Intrinsic
	Shares			Price		per Share		Value
Outstanding at December 31, 2006		381,976		$	31.65	$	25.13-$33.15	$	5,823
Exercised		(19,600	)	$	31.27	$	30.38-$33.13	$	230
Expired or Terminated		(6,475	)	$	30.85	$	27.25-$33.13
Outstanding at December 31, 2007		355,901		$	31.68	$	25.13-$33.15	$	3,669
Exercised		(6,300	)	$	27.58	$	25.13-$31.13	$	24
Expired or Terminated		(71,000	)	$	31.13	$	31.13-$31.13
Outstanding at December 31, 2008		278,601		$	31.92	$	27.25-$33.15	$	0

86

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table summarizes currently outstanding and exercisable options as of December 31, 2008:

	Number		Weighted		Weighted
	Outstanding		Average		Average
	and		Remaining		Exercise
Range of Exercise Price	Exercisable		Contractual Life		Price
$27.25 - $30.53		95,601		2.37	$	30.03
$31.05 - $33.15		183,000		2.24	$	32.90

In September 1994, the Board of Directors approved and we adopted a 401(k)/Profit Sharing Plan. Under our 401(k)/Profit Sharing Plan, all eligible employees may participate by making voluntary contributions. We may make, but are not required to make, matching contributions. For the years ended December 31, 2008, 2007 and 2006, we made matching contributions of $0, $542, and $451, respectively.

For the years ended December 31, 2008, 2007 and 2006, we awarded 588,628, 442,008, and 303,142 restricted stock/Units to our employees having a fair value at grant date of $18,860, $20,882, and $11,519, respectively. We also awarded 21,945, 17,139, and 16,232 restricted stock/Units to our directors having a fair value at grant date of $603, $688, and $633, respectively. Restricted stock/Units granted to employees generally vest over a period of three years and restricted stock/Units granted to directors generally vest over a period or three to ten years. For the years ended December 31, 2008, 2007 and 2006, we recognized $25,883, $14,150, and $9,624 in restricted stock amortization related to restricted stock/Units, of which $1,519, $1,707, and $967, respectively, were capitalized in connection with development activities. At December 31, 2008, we have $16,556 in unearned compensation related to unvested restricted stock/Units. The weighted average period that the unrecognized compensation is expected to be incurred is 1.11 years. We have not awarded options to our employees or our directors during the years ended December 31, 2008, 2007 and 2006, and therefore no stock-based employee compensation expense related to options is included in net income available to unitholders.

Restricted stock/Units transactions for the years ended December 31, 2008 and 2007 are summarized as follows:

				Weighted
				Average
				Grant Date
	Shares			Fair Value
Outstanding at December 31, 2006		778,535		$	35.49
Issued		459,147		$	46.98
Vested		(272,745	)	$	37.74
Forfeited		(54,971	)	$	39.59
Outstanding at December 31, 2007		909,966		$	41.88
Issued		610,573		$	31.88
Vested		(733,666	)	$	22.97
Forfeited		(25,213	)	$	35.17
Outstanding at December 31, 2008		761,660		$	36.00

On October 23, 2008, we granted stock appreciation rights (SARs) to our interim Chief Executive Officer that entitles him to a special cash payment equal to the appreciation in value of 75,000 shares of our common stock. The payment is to be based on the excess of the closing price of our common stock on October 22, 2009 over $7.94, the closing price on the grant date. The award fully vested during the three months ended December 31, 2008 upon his acceptance of the position.

87

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The fair value of each SAR was determined using the Black-Scholes option pricing model with the following assumptions:

	December 31,
	2008
Stock price	$	7.55
Exercise price	$	7.94
Expected dividend yield		17.6	%
Expected stock volatility		133.5	%
Risk-free interest rate		0.33	%
Expected life (years)		0.81
Value	$	2.62

During the three months ended December 31, 2008, we recognized compensation expense of $197 relating to the SARs.

17.   Derivatives

As of December 31, 2008, we have two forward starting swaps with a total notional value of $119,500, which fixed the interest rate on forecasted debt to replace the 2009 Notes which come due in June 2009 (the “Forward Starting Agreements”). We designated the Forward Starting Agreements as cash flow hedges. We anticipate that the Forward Starting Agreements will be highly effective, and, as a result, the change in value is shown in other comprehensive income. We recorded $6,881 related to the Forward Starting Agreements in mark to market loss, which is included in other comprehensive income for the year ended December 31, 2008.

As of December 31, 2008, we also have an interest rate swap agreement with a notional value of $50,000 which fixed the LIBOR rate on a portion of our outstanding borrowings on our Unsecured Line of Credit at 2.4150% (the “Interest Rate Swap Agreement”). Monthly payments or receipts are treated as a component of interest expense. We designated this transaction as a cash flow hedge. We anticipate that the Interest Rate Swap Agreement will be highly effective, and, as a result, the change in the fair value is shown in other comprehensive income. We recorded $858 in mark to market loss, which is included in other comprehensive income for the year ended December 31, 2008.

On or after March 31, 2009, the Company’s Series F Preferred Stock is subject to a coupon rate reset. The coupon rate resets every quarter beginning March 31, 2009 at 2.375% plus the greater of i) the 30 Year U.S. Treasury rate, ii) the 10 Year U.S. Treasury rate oriii) 3-Month LIBOR. In October 2008 we entered into an interest rate swap agreement with a notional value of $50,000 to mitigate our exposure to floating interest rates related to the forecasted reset rate of the Company’s Series F Preferred Stock (the “Series F Agreement”). This Series F Agreement fixes the30-year U.S. Treasury rate at 5.2175%. SFAS 133 does not permit hedge accounting treatment related to equity instruments and therefore the mark to market gains or losses related to this agreement are recorded in the income statement. We recorded $3,073 in mark to market loss which is included in mark to market/loss on settlement of interest rate protection agreements for the year ended December 31, 2008.

88

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following is a summary of the terms of the forward starting swaps and the interest rate swaps and their fair values, which are included in other liabilities on the accompanying consolidated balance sheet as of December 31, 2008:

										Fair
Hedge Product	Notional Amount		Strike			Trade Date		Maturity Date		Value
Forward-Starting Agreement	$	59,750		4.0725	%		January 2008		May 15, 2014	$	(3,429	)
Forward-Starting Agreement		59,750		4.0770	%		January 2008		May 15, 2014		(3,452	)
Interest Rate Swap Agreement		50,000		2.4150	%		March 2008		April 1, 2010		(858	)
Series F Agreement		50,000		5.2175	%		October 2008		October 1, 2013		(3,073	)
Total	$	219,500							Total	$	(10,812	)

Additionally as of December 31, 2008, two of the Joint Ventures have interest rate protection agreements outstanding which effectively convert floating rate debt to fixed rate debt on a portion of their total variable debt. The hedge relationships are considered highly effective and as such, we have recorded our proportionate share of the mark to market gain (loss) in other comprehensive income. In the aggregate, we recorded $1,547 in mark to market loss (net of $610 of income tax benefit) which is included in mark to market of interest rate protection agreements in other comprehensive income for the year ended December 31, 2008. In the aggregate, we recorded $650 in mark to market loss (net of $254 of income tax benefit) which is included in other comprehensive income for the year ended December 31, 2007.

We adopted the provisions of SFAS 157 as of January 1, 2008, for financial instruments recorded at fair value. SFAS 157 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The following table sets forth our financial liabilities that are accounted for at fair value on a recurring basis as of December 31, 2008:

			Fair Value Measurements at Reporting
			Date Using:
			Quoted Prices in
			Active Markets for		Significant Other		Unobservable
	December 31,		Identical Assets		Observable Inputs		Inputs
Description	2008		(Level 1)		(Level 2)		(Level 3)
Liabilities:
Forward Starting Agreements	$	6,881		—	$	6,881		—
Interest Rate Swap Agreement	$	858		—	$	858		—
Series F Agreement	$	3,073		—		—	$	3,073

The valuation of the forward starting swap agreements and the interest rate swap agreement are determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each instrument. This analysis reflects the contractual terms of the agreements, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. In adjusting the fair value of the interest rate protection agreements for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements. To comply with the provisions of SFAS 157, we incorporated credit valuation adjustments (“CVA”) to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. However, assessing significance of inputs is a matter of judgment that should consider a variety of factors. One factor we consider is the CVA and its materiality to the overall valuation of

89

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

the derivatives on the balance sheet and to their related changes in fair value. We believe the inputs obtained related to our CVAs are observable and therefore fall under Level 2 of the fair value hierarchy. Accordingly, the liabilities related to the Forward Starting Agreements and the Interest Rate Swap Agreement are classified as Level 2 amounts.

We utilize the same valuation technique as the forward starting swap agreement and the interest rate swap agreement, however, we consider the Series F Agreement to be classified as Level 3 in the fair value hierarchy due to a significant number of unobservable inputs. The Series F Agreement swaps a fixed rate 5.2175% for floating rate payments based on30-year Treasury. No market observable prices exist for long-dated Treasuries past 30 years. Therefore we have classified the Series F Agreement in its entirety as a Level 3.

Additionally for the year ended December 31, 2008, we determined that the carrying value of some of the Joint Ventures was greater than the fair value and accordingly, recorded impairment charges in accordance with APB 18 (See Note 5). The fair value of each Joint Venture was based on internal modeling techniques which included a number of subjective inputs. No observable market prices exist for the inputs used and therefore, we would classify the fair values of the Joint Ventures as Level 3.

The following table presents a reconciliation for our liabilities classified as Level 3 at December 31, 2008:

	Fair Value Measurements
	Using Significant
	Unobservable Inputs
	(Level 3)
	Derivatives
Beginning liability balance	$	—
Total unrealized losses
Losses included in earnings		3,073
Ending liability balance	$	3,073

18.   Related Party Transactions

We periodically engage in transactions for which CB Richard Ellis, Inc. acts as a broker. A relative of Michael W. Brennan, the former President and Chief Executive Officer and a former director of the Company, is an employee of CB Richard Ellis, Inc. For the years ended December 31, 2008, 2007 and 2006 this relative received approximately $95, $240 and $341, respectively, in brokerage commissions or other fees for transactions with the Consolidated Operating Partnership and the Joint Ventures.

At December 31, 2008 we have a payable balance of $18,076 to wholly owned entities of the Company. At December 31, 2007 we had a payable balance of $45,901 to wholly owned entities of the Company.

19.   Commitments and Contingencies

In the normal course of business, we are involved in legal actions arising from the ownership of our properties. In our opinion, the liabilities, if any, that may ultimately result from such legal actions are not expected to have a materially adverse effect on our consolidated financial position, operations or liquidity.

Six properties have leases granting the tenants options to purchase the property. Such options are exercisable at various times and at appraised fair market value or at a fixed purchase price in excess of our depreciated cost of the asset. We have no notice of any exercise of any tenant purchase option.

We have committed to the construction of certain development projects totaling approximately 1.1 million square feet of GLA. The estimated total construction costs are approximately $53,982. Of this amount,

90

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

approximately $11,932 remains to be funded. There can be no assurance that the actual completion cost will not exceed the estimated completion cost stated above.

At December 31, 2008, we had 16 letters of credit outstanding in the aggregate amount of $5,580. These letters of credit expire between January 2009 and January 2010.

Ground and Operating Lease Agreements

For the years ended December 31, 2008, 2007 and 2006, we recognized $4,072, $3,102 and $2,737 in operating and ground lease expense.

Future minimum rental payments under the terms of all non-cancelable ground and operating leases under which we are the lessee, as of December 31, 2008, are as follows:

2009	$	3,864
2010		3,450
2011		3,014
2012		2,236
2013		2,071
Thereafter		33,472
Total	$	48,107

20.   Subsequent Events

On January 21, 2009, we paid a fourth quarter 2008 distribution of $0.25 per Unit, totaling approximately $12,614.

From January 1, 2009 to February 20, 2009, the Company awarded 8,612 shares of restricted common stock to certain Directors. We issued General Partner Units to the Company in the same amount. These shares of restricted common stock had a fair value of approximately $61 on the date of grant. The restricted common stock and units vest over five years. Compensation expense will be charged to earnings over the respective vesting period.

From January 1, 2009 to February 20, 2009, we acquired one land parcel for a total estimated investment of approximately $208. There were no industrial properties sold during this period.

On February 25, 2009, the Board of Directors approved additional modifications to the restructuring plan consisting of further organizational and overhead cost reductions. We anticipate our total pre-tax restructuring costs to range between $32,900 and $33,500, including the $26,711 that was recorded for the year ended December 31, 2008. The additional modifications primarily consist of employee severance and benefits, office closing costs and other related costs.

91

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

21.   Quarterly Financial Information (unaudited)

The following table summarizes our quarterly financial information. The first, second and third fiscal quarters of 2008 and all fiscal quarters in 2007 have been reclassified in accordance with FAS 144.

	Year Ended December 31, 2008
	First			Second			Third			Fourth
	Quarter			Quarter			Quarter			Quarter
Total Revenues	$	103,422		$	118,865		$	128,196		$	133,695
Equity in Income (Loss) of Joint Ventures		3,302			3,268			725			(40,473	)
Equity in Income of Other Real Estate Partnerships		9,099			32,064			3,051			5,545
(Loss) Income from Continuing Operations, Net of Income Tax		(16,805	)		7,361			(14,525	)		(80,132	)
Income from Discontinued Operations, Net of Income Tax		72,112			41,609			23,890			3,559
Gain on Sale of Real Estate, Net of Income Tax		5,438			2,841			—			—
Net Income (Loss)		60,745			51,811			9,365			(76,573	)
Preferred Unit Distributions		(4,857	)		(4,857	)		(4,857	)		(4,857	)
Net Income (Loss) Available to Unitholders	$	55,888		$	46,954		$	4,508		$	(81,430	)
Basic and Diluted Earnings Per Unit:
(Loss) Income From Continuing Operations Available to Unitholders	$	(0.33	)	$	0.11		$	(0.39	)	$	(1.71	)
Income From Discontinued Operations	$	1.46		$	0.84		$	0.48		$	0.07
Net Income (Loss) Available to Unitholders	$	1.13		$	0.95		$	0.09		$	(1.64	)
Weighted Average Units Outstanding - Basic		49,407			49,416			49,431			49,569
Weighted Average Units Outstanding - Diluted		49,407			49,427			49,431			49,569

92

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

	Year Ended December 31, 2007
	First			Second			Third			Fourth
	Quarter			Quarter			Quarter			Quarter
Total Revenues	$	84,911		$	83,769		$	82,371		$	90,436
Equity in Income of Joint Ventures		5,631			11,626			6,290			6,411
Equity in Income Other Real Estate Partnerships		5,520			4,374			5,275			11,080
Loss from Continuing Operations, Net of Income Tax		(15,468	)		(14,563	)		(16,000	)		(12,214	)
Income from Discontinued Operations, Net of Income Tax		53,413			55,720			54,354			63,840
Gain on Sale of Real Estate, Net of Income Tax		1,261			503			64			2,969
Net Income		39,206			41,660			38,418			54,595
Preferred Unit Distributions		(5,935	)		(5,671	)		(4,857	)		(4,857	)
Redemption of Preferred Units		—			(2,017	)		—			—
Net Income Available to Unitholders	$	33,271		$	33,972		$	33,561		$	49,738
					��
Basic and Diluted Earnings Per Unit:
Loss From Continuing Operations Available to Unitholders	$	(0.40	)	$	(0.43	)	$	(0.41	)	$	(0.28	)
Income From Discontinued Operations	$	1.05		$	1.09		$	1.07		$	1.28
Net Income Available to Unitholders	$	0.65		$	0.67		$	0.66		$	1.00
Weighted Average Units Outstanding		50,966			50,985			50,735			49,715

22.   Pro Forma Financial Information (unaudited)

The following Pro Forma Condensed Statements of Operations for the years ended December 31, 2008 and 2007 (the “Pro Forma Statements”) are presented as if the acquisition of 18 operating industrial properties between January 1, 2008 and December 31, 2008 had occurred at the beginning of each year. The Pro Forma Statements do not include acquisitions between January 1, 2008 and December 31, 2008 for industrial properties that were vacant upon purchase, were leased back to the sellers upon purchase or were subsequently sold before December 31, 2008. The Pro Forma Condensed Statements of Operations include all necessary adjustments to reflect the occurrence of purchases and sales of properties during 2008 as of January 1, 2008 and 2007.

93

FIRST INDUSTRIAL, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Pro Forma Statements are not necessarily indicative of what our results of operations would have been for the years ended December 31, 2008 and 2007, nor do they purport to present our future results of operations.

Pro Forma Condensed Statements of Operations

	Year Ended			Year Ended
	December 31,			December 31,
	2008			2007
Pro Forma Revenues	$	489,014		$	358,036
Pro Forma Loss from Continuing Operations Available to Unitholders, Net of Income Taxes	$	(113,050	)	$	(60,423	)
Pro Forma Net Income Available to Unitholders	$	28,120		$	166,904
Per Unit Data:
Pro Forma Basic and Diluted Earnings Per Unit Data:
Loss from Continuing Operations Available to Unitholders	$	(2.29	)	$	(1.19	)
Net Income Available to Unitholders	$	0.57		$	3.30

The following Pro Forma Condensed Statements of Operations for the years ended December 31, 2007 and 2006 (the “Pro Forma Statements”) are presented as if the acquisition of 54 operating industrial properties between January 1, 2007 and December 31, 2007 had occurred at the beginning of each year. The Pro Forma Statements do not include acquisitions between January 1, 2007 and December 31, 2007 for industrial properties that were vacant upon purchase, were leased back to the sellers upon purchase or were subsequently sold before December 31, 2007. The Pro Forma Condensed Statements of Operations include all necessary adjustments to reflect the occurrence of purchases and sales of properties during 2007 as of January 1, 2007 and 2006.

The Pro Forma Statements are not necessarily indicative of what our results of operations would have been for the years ended December 31, 2007 and 2006, nor do they purport to present our future results of operations.

Pro Forma Condensed Statements of Operations

	Year Ended			Year Ended
	December 31,			December 31,
	2007			2006
Pro Forma Revenues	$	389,402		$	323,514
Pro Forma Loss from Continuing Operations Available to Unitholders, Net of Income Taxes	$	(44,520	)	$	(37,691	)
Pro Forma Net Income Available to Unitholders	$	169,199		$	131,442
Per Unit Data:
Pro Forma Basic and Diluted Earnings Per Unit Data:
Loss from Continuing Operations Available to Unitholders	$	(0.88	)	$	(0.74	)
Net Income Available to Unitholders	$	3.34		$	2.59

94

FIRST INDUSTRIAL, LP.

SCHEDULE III:

REAL ESTATE AND ACCUMULATED DEPRECIATION
As of December 31, 2008

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
Atlanta
1650 GA Highway 155	McDonough, GA		788		4,544		356			788		4,900		5,688		1,714		1994		(l	)
1665 Dogwood Drive	Conyers, GA		635		3,662		317			635		3,979		4,614		1,377		1994		(l	)
1715 Dogwood Drive	Conyers, GA		288		1,675		1,785			288		3,460		3,748		785		1994		(l	)
11235 Harland Drive	Covington, GA		125		739		163			125		902		1,027		293		1994		(l	)
4051 Southmeadow Parkway	Atlanta, GA		726		4,130		857			726		4,987		5,713		1,637		1994		(l	)
4071 Southmeadow Parkway	Atlanta, GA		750		4,460		1,308			828		5,690		6,518		1,973		1994		(l	)
4081 Southmeadow Parkway	Atlanta, GA		1,012		5,918		1,726			1,157		7,499		8,656		2,553		1994		(l	)
370 Great Southwest Parkway(d)	Atlanta, GA		527		2,984		650			546		3,615		4,161		1,187		1996		(l	)
955 Cobb Place	Kennesaw, GA		780		4,420		684			804		5,080		5,884		1,497		1997		(l	)
1256 Oakbrook Drive	Norcross, GA		336		1,907		335			339		2,239		2,578		510		2001		(l	)
1265 Oakbrook Drive	Norcross, GA		307		1,742		637			309		2,377		2,686		544		2001		(l	)
1280 Oakbrook Drive	Norcross, GA		281		1,592		311			283		1,901		2,184		403		2001		(l	)
1300 Oakbrook Drive	Norcross, GA		420		2,381		236			423		2,614		3,037		467		2001		(l	)
1325 Oakbrook Drive	Norcross, GA		332		1,879		335			334		2,212		2,546		488		2001		(l	)
1351 Oakbrook Drive	Norcross, GA		370		2,099		386			373		2,482		2,855		471		2001		(l	)
1346 Oakbrook Drive	Norcross, GA		740		4,192		703			744		4,891		5,635		877		2001		(l	)
1412 Oakbrook Drive	Norcross, GA		313		1,776		256			315		2,030		2,345		412		2001		(l	)
Greenwood Industrrial Park	McDonough, GA		1,550		—		7,485			1,550		7,485		9,035		818		2004		(l	)
3060 South Park Blvd	Ellenwood, GA		1,600		12,464		891			1,603		13,352		14,955		2,171		2003		(l	)
46 Kent Drive	Cartersville, GA		794		2,476		(218	)		798		2,254		3,052		303		2005		(l	)
100 Dorris Williams Industrial -King	Atlanta, GA	(m)	401		3,754		42			406		3,791		4,197		776		2005		(l	)
605 Stonehill Diver	Atlanta, GA		485		1,979		27			490		2,001		2,491		761		2005		(l	)
6514 Warren Drive	Norcross, GA		510		1,250		(104	)		513		1,143		1,656		142		2005		(l	)
6544 Warren Drive	Norcross, GA		711		2,310		65			715		2,371		3,086		370		2005		(l	)
720 Industrial Boulevard	Dublin, GA		250		2,632		40			255		2,667		2,922		1,057		2005		(l	)
5356 East Ponce DeLeon	One Mountain, GA		604		3,888		(55	)		610		3,827		4,437		748		2005		(l	)
5390 East Ponce DeLeon	One Mountain, GA		397		1,791		(5	)		402		1,781		2,183		283		2005		(l	)
1755 Enterprise Drive	Buford, GA		712		2,118		53			716		2,167		2,883		277		2006		(l	)
4555 Atwater Court	Buford, GA		881		3,550		558			885		4,104		4,989		508		2006		(l	)
80 Liberty Industrial Parkway	McDonough, GA		756		3,695		212			763		3,900		4,663		306		2007		(l	)
596 Bonnie Valentine Way	Pendergrass, GA		2,580		21,730		1,203			2,594		22,919		25,513		786		2007		(l	)
11415 Old Roswell Road	Alpharetta, GA		2,403		1,912		90			2,427		1,978		4,405		39		2008		(l	)
195 & 197 Collins Boulevard	Athens, GA		1,410		5,344		65			1,426		5,393		6,819		1,994		2005		(l	)
Baltimore
1820 Portal	Baltimore, MD		884		4,891		454			899		5,330		6,229		1,418		1998		(l	)

S-1

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or		Gross Amount Carried
			(b)			Completion		At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation				Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision		Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
9700 Martin Luther King Hwy	Lanham, MD		700		1,920		555		700		2,475		3,175		646		2003		(l	)
9730 Martin Luther King Hwy	Lanham, MD		500		955		508		500		1,463		1,963		388		2003		(l	)
4621 Boston Way	Lanham, MD		1,100		3,070		601		1,100		3,671		4,771		780		2003		(l	)
4720 Boston Way	Lanham, MD		1,200		2,174		541		1,200		2,715		3,915		695		2003		(l	)
2250 Randolph Drive	Dulles, VA		3,200		8,187		36		3,208		8,215		11,423		1,234		2004		(l	)
22630 Dulles Summit Court	Dulles, VA		2,200		9,346		131		2,206		9,471		11,677		1,446		2004		(l	)
4201 Forbes Boulevard	Lanham, MD		356		1,823		417		375		2,221		2,596		460		2005		(l	)
4370-4383 Lottsford Vista Road	Lanham, MD		279		1,358		171		296		1,512		1,808		227		2005		(l	)
4400 Lottsford Vista Road	Lanham, MD		351		1,955		160		372		2,094		2,466		276		2005		(l	)
4420 Lottsford Vista Road	Lanham, MD		539		2,196		241		568		2,408		2,976		372		2005		(l	)
11204 McCormick Road	Hunt Valley, MD		1,017		3,132		104		1,038		3,215		4,253		506		2005		(l	)
11110 Pepper Road	Hunt Valley, MD		918		2,529		271		938		2,780		3,718		445		2005		(l	)
11100 Gilroy Road	Hunt Valley, MD		901		1,455		57		919		1,494		2,413		305		2005		(l	)
336 Clubhouse	Hunt Valley, MD		982		3,158		544		1,004		3,680		4,684		726		2005		(l	)
10709 Gilroy Road	Hunt Valley, MD		913		2,705		46		913		2,751		3,664		556		2005		(l	)
7120-7132 Ambassador Road	Hunt Valley, MD		829		1,329		253		847		1,564		2,411		333		2005		(l	)
7142 Ambassador Road	Hunt Valley, MD		924		2,876		415		942		3,273		4,215		345		2005		(l	)
7144-7160 Ambassador Road	Hunt Valley, MD		979		1,672		145		1,000		1,796		2,796		450		2005		(l	)
7200 Rutherford	Hunt Valley, MD		1,032		2,150		165		1,054		2,293		3,347		470		2005		(l	)
2700 Lord Baltimore	Hunt Valley, MD		875		1,826		275		897		2,079		2,976		520		2005		(l	)
9800 Martin Luther King Hwy	Lanham, MD		1,200		2,457		281		1,200		2,738		3,938		554		2003		(l	)
Baltimore Crossroads
@95	Baltimore, MD		2,640		270		13,041		2,823		13,128		15,951		558		2007		(l	)
Central Pennsylvania
16522 Hunters Green Parkway	Hagerstown, MD	(n)	1,390		13,104		3,903		1,863		16,534		18,397		2,311		2003		(l	)
Golden Eagle Business Center	Harrisburg, PA		585		3,176		161		601		3,321		3,922		444		2005		(l	)
320 Museum Road	Washington, PA		201		1,819		57		208		1,869		2,077		347		2005		(l	)
Chicago
3600 West Pratt Avenue	Lincolnwood, IL		1,050		5,767		1,205		1,050		6,972		8,022		2,485		1994		(l	)
6750 South Sayre Avenue	Bedford Park, IL		224		1,309		642		224		1,951		2,175		695		1994		(l	)
585 Slawin Court	Mount Prospect, IL		611		3,505		2,055		615		5,556		6,171		1,568		1994		(l	)
2300 Windsor Court	Addison, IL		688		3,943		1,023		696		4,958		5,654		1,745		1994		(l	)
3505 Thayer Court	Aurora, IL		430		2,472		90		430		2,562		2,992		909		1994		(l	)
305-311 Era Drive	Northbrook, IL		200		1,154		145		205		1,294		1,499		462		1994		(l	)
12241 Melrose Street	Franklin Park, IL		332		1,931		1,334		469		3,128		3,597		1,024		1995		(l	)
11939 S Central Avenue	Alsip, IL		1,208		6,843		3,477		1,305		10,223		11,528		2,555		1997		(l	)
405 East Shawmut	LaGrange, IL		368		2,083		507		388		2,570		2,958		664		1997		(l	)
1010-50 Sesame Street	Bensenville, IL		979		5,546		2,673		1,048		8,150		9,198		1,913		1997		(l	)
7501 S. Pulaski	Chicago, IL		318		2,038		1,516		318		3,554		3,872		800		1997		(l	)
2120-24 Roberts	Broadview, IL		220		1,248		491		231		1,728		1,959		606		1998		(l	)
800 Business Center Drive	Mount Prospect, IL		631		3,493		237		666		3,695		4,361		745		2000		(l	)
580 Slawin Court	Mount Prospect, IL		233		1,292		317		254		1,588		1,842		293		2000		(l	)

S-2

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
1150 Feehanville Drive	Mount Prospect, IL		260		1,437		131			273		1,555		1,828		334		2000		(l	)
19W661 101st Street	Lemont, IL		1,200		6,643		2,300			1,220		8,923		10,143		2,143		2001		(l	)
175 Wall Street	Glendale Heights, IL		427		2,363		163			433		2,520		2,953		447		2002		(l	)
800-820 Thorndale Avenue	Bensenville, IL		751		4,159		1,638			761		5,787		6,548		961		2002		(l	)
1661 Feehanville Drive	Mount Prospect, IL		985		5,455		2,061			1,044		7,457		8,501		1,718		2004		(l	)
1850 Touhy &1158-60 McCage Ave	Elk Grove Village, IL		1,500		4,842		164			1,514		4,992		6,506		1,009		2004		(l	)
1088-1130 Thorndale Avenue	Bensenville, IL		2,103		3,674		129			2,108		3,798		5,906		652		2005		(l	)
855-891 Busse(Route 83)	Bensenville, IL		1,597		2,767		(42	)		1,601		2,721		4,322		495		2005		(l	)
1060-1074 W. Thorndale Ave	Bensenville, IL		1,704		2,108		179			1,709		2,282		3,991		461		2005		(l	)
400 Crossroads Parkway	Bolingbrook, IL		1,178		9,453		850			1,181		10,300		11,481		1,603		2005		(l	)
7609 West Industrial Drive	Forest Park, IL		1,207		2,343		207			1,213		2,544		3,757		503		2005		(l	)
7801 West Industrial Drive	Forest Park, IL		1,215		3,020		19			1,220		3,034		4,254		600		2005		(l	)
1111 Davis Road	Elgin, IL		998		1,859		833			1,046		2,644		3,690		706		2006		(l	)
2900 W 166th St	Markham, IL		1,132		4,293		269			1,134		4,560		5,694		541		2007		(l	)
555 W Algonquin Rd	Arlington Heights, IL		574		741		2,053			579		2,789		3,368		167		2007		(l	)
7000 W 60th Street	Chicago, IL		609		932		106			667		980		1,647		161		2007		(l	)
9501 Nevada	Franklin Park, IL		2721		5630		500			2,737		6,114		8,851		319		2008		(l	)
1501 Oakton Street	Elk Grove Village, IL		3369		6121		69			3,412		6,147		9,559		267		2008		(l	)
16500 W 103rd Street	Woodridge, IL		744		2458		101			760		2,544		3,304		85		2008		(l	)
251 Airport Road	Aurora, IL		983		—		6,681			983		6,681		7,664		1,017		2002		(l	)
725 Kimberly Drive	Carol Stream, IL		793		1,395		38			801		1,425		2,226		231		2005		(l	)
17001 S. Vincennes	Thornton, IL		497		504		103			513		591		1,104		176		2005		(l	)
Rust-Oleum BTS	Kenosha, WI		4,100		—		18,418			3,212		19,306		22,518		76		2008		(l	)
Cincinnati
9900-9970 Princeton	Cincinnati, OH		545		3,088		1,887			566		4,954		5,520		1,676		1996		(l	)
2940 Highland Avenue	Cincinnati, OH		1,717		9,730		1,794			1,772		11,469		13,241		3,559		1996		(l	)
4700-4750 Creek Road	Blue Ash, OH		1,080		6,118		1,044			1,109		7,133		8,242		2,158		1996		(l	)
901 Pleasant Valley Drive	Springboro, OH		304		1,721		333			316		2,042		2,358		560		1998		(l	)
4436 Muhlhauser Road	Hamilton, OH		630		—		5,264			630		5,264		5,894		1,035		2002		(l	)
4438 Muhlhauser Road	Hamilton, OH		779		—		6,795			779		6,795		7,574		1,227		2002		(l	)
9525 Glades Drive	West Chester, OH		347		1,323		87			355		1,402		1,757		145		2007		(l	)
9776-9876 Windisch Road	West Chester, OH		392		1,744		20			394		1,762		2,156		123		2007		(l	)
9810-9822 Windisch Road	West Chester, OH		395		2,541		64			397		2,603		3,000		134		2007		(l	)
9842-9862 Windisch Road	West Chester, OH		506		3,148		106			508		3,252		3,760		236		2007		(l	)
9872-9898 Windisch Road	West Chester, OH		546		3,039		47			548		3,084		3,632		170		2007		(l	)
9902-9922 Windisch Road	West Chester, OH		623		4,003		92			627		4,091		4,718		291		2007		(l	)
420 Wars Corner Road	Loveland, OH		600		1,083		1,023			606		2,100		2,706		620		2003		(l	)
422 Wards Corner Road	Loveland, OH		600		1,811		395			605		2,201		2,806		758		2003		(l	)
4663 Dues Drive	West Chester, OH		858		2,273		1,183			875		3,439		4,314		1,213		2005		(l	)
8181 Darrow Road	Twinsburg, OH		2478		6,791		78			2,496		6,852		9,348		248		2008		(l	)
Cleveland
30311 Emerald Valley Parkway	Glenwillow, OH		681		11,838		1,084			691		12,912		13,603		1,227		2006		(l	)
30333 Emerald Valley Parkway	Glenwillow, OH		466		5,447		103			475		5,541		6,016		600		2006		(l	)

S-3

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
7800 Cochran Road	Glenwillow, OH		972		7,033		146			991		7,160		8,151		769		2006		(l	)
7900 Cochran Road	Glenwillow, OH		775		6,244		136			792		6,363		7,155		650		2006		(l	)
7905 Cochran Road	Glenwillow, OH		920		6,174		100			945		6,249		7,194		624		2006		(l	)
30600 Carter Street	Solon, OH		989		3,042		408			1,022		3,417		4,439		908		2006		(l	)
Columbus
3800 Lockbourne Industrial Pkwy	Columbus, OH		1,045		6,421		707			1,045		7,128		8,173		2,106		1996		(l	)
3880 Groveport Road	Columbus, OH		1,955		12,154		675			1,955		12,829		14,784		4,156		1996		(l	)
1819 North Walcutt Road	Columbus, OH		637		4,590		(140	)		634		4,453		5,087		1,408		1997		(l	)
4300 Cemetary Road	Hillard, OH		764		620		—			764		620		1,384		41		1997		(l	)
4115 Leap Road(d)	Hillard, OH		756		4,297		1,471			756		5,768		6,524		1,427		1998		(l	)
3300 Lockbourne	Columbus, OH		708		3,920		1,258			710		5,176		5,886		1,299		1998		(l	)
1076 Pittsburgh Drive	Delaware, OH	(o)	2,265		4,733		62			2,273		4,787		7,060		888		2005		(l	)
6150 Huntley Road	Columbus, OH		920		4,810		8			925		4,813		5,738		564		2005		(l	)
4600 S. Hamilton Road	Groveport, OH		681		5,941		(142	)		688		5,792		6,480		496		2006		(l	)
2200 Spiegel	Groveport, OH		780		3,205		308			793		3,500		4,293		208		2007		(l	)
4311 Janitrol Road	Columbus, OH		662		4,332		829			675		5,148		5,823		411		2007		(l	)
Dallas/Fort Worth
2406-2416 Walnut Ridge	Dallas, TX		178		1,006		483			172		1,495		1,667		322		1997		(l	)
2401-2419 Walnut Ridge	Dallas, TX		148		839		239			142		1,084		1,226		278		1997		(l	)
900-906 Great Southwest Pkwy	Arlington, TX		237		1,342		596			270		1,905		2,175		598		1997		(l	)
3000 West Commerce	Dallas, TX		456		2,584		526			469		3,097		3,566		837		1997		(l	)
3030 Hansboro	Dallas, TX		266		1,510		529			276		2,029		2,305		500		1997		(l	)
405-407 113th	Arlington, TX		181		1,026		429			185		1,451		1,636		334		1997		(l	)
816 111th Street	Arlington, TX		251		1,421		169			258		1,583		1,841		491		1997		(l	)
7341 Dogwood Park	Richland Hills, TX		79		435		82			84		512		596		145		1998		(l	)
7427 Dogwood Park	Richland Hills, TX		96		532		572			102		1,098		1,200		326		1998		(l	)
7348-54 Tower Street	Richland Hills, TX		88		489		283			94		766		860		216		1998		(l	)
7339-41 Tower Street	Richland Hills, TX		98		541		188			104		723		827		179		1998		(l	)
7437-45 Tower Street	Richland Hills, TX		102		563		85			108		642		750		163		1998		(l	)
7331-59 Airport Freeway	Richland Hills, TX		354		1,958		395			372		2,335		2,707		609		1998		(l	)
7338-60 Dogwood Park	Richland Hills, TX		106		587		127			112		708		820		171		1998		(l	)
7450-70 Dogwood Park	Richland Hills, TX		106		584		127			112		705		817		173		1998		(l	)
7423-49 Airport Freeway	Richland Hills, TX		293		1,621		360			308		1,966		2,274		506		1998		(l	)
7400 Whitehall Street	Richland Hills, TX		109		603		91			115		688		803		193		1998		(l	)
1602-1654 Terre Colony	Dallas, TX		458		2,596		765			468		3,351		3,819		640		2000		(l	)
3330 Duncanville Road	Dallas, TX		197		1,114		68			199		1,180		1,379		247		2000		(l	)
2351-2355 Merritt Drive	Garland, TX		101		574		112			103		684		787		140		2000		(l	)
701-735 North Plano Road	Richardson, TX		696		3,944		217			705		4,152		4,857		891		2000		(l	)
2220 Merritt Drive	Garland, TX		352		1,993		779			356		2,768		3,124		627		2000		(l	)
2010 Merritt Drive	Garland, TX		350		1,981		598			357		2,572		2,929		608		2000		(l	)
2363 Merritt Drive	Garland, TX		73		412		170			74		581		655		102		2000		(l	)
2447 Merritt Drive	Garland, TX		70		395		77			71		471		542		95		2000		(l	)
2465-2475 Merritt Drive	Garland, TX		91		514		145			92		658		750		125		2000		(l	)

S-4

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
2485-2505 Merritt Drive	Garland, TX		431		2,440		562			436		2,997		3,433		587		2000		(l	)
2081 Hutton Drive(e)	Carrolton, TX		448		2,540		438			453		2,973		3,426		570		2001		(l	)
2110 Hutton Drive	Carrolton, TX		374		2,117		437			377		2,551		2,928		586		2001		(l	)
2025 McKenzie Drive	Carrolton, TX		437		2,478		351			442		2,824		3,266		557		2001		(l	)
2019 McKenzie Drive	Carrolton, TX		502		2,843		519			507		3,357		3,864		726		2001		(l	)
1420 Valwood Parkway — Bldg 1(d)	Carrolton, TX		460		2,608		717			466		3,319		3,785		636		2001		(l	)
1620 Valwood Parkway(e)	Carrolton, TX		1,089		6,173		1,266			1,100		7,428		8,528		1,396		2001		(l	)
1505 Luna Road — Bldg II	Carrolton, TX		167		948		70			169		1,016		1,185		202		2001		(l	)
1625 West Crosby Road	Carrolton, TX		617		3,498		459			631		3,943		4,574		824		2001		(l	)
2029-2035 McKenzie Drive	Carrolton, TX		306		1,870		699			306		2,569		2,875		790		2001		(l	)
1840 Hutton Drive(d)	Carrolton, TX		811		4,597		757			819		5,346		6,165		1,040		2001		(l	)
1420 Valwood Pkwy — Bldg II	Carrolton, TX		373		2,116		376			377		2,488		2,865		526		2001		(l	)
2015 McKenzie Drive	Carrolton, TX		510		2,891		415			516		3,300		3,816		659		2001		(l	)
2009 McKenzie Drive	Carrolton, TX		476		2,699		386			481		3,080		3,561		640		2001		(l	)
1505 Luna Road — Bldg I	Carrolton, TX		521		2,953		476			529		3,421		3,950		773		2001		(l	)
900-1100 Avenue S	Grand Prairie, TX		623		3,528		1,307			629		4,829		5,458		646		2002		(l	)
Plano Crossing(f)	Plano, TX		1,961		11,112		616			1,981		11,708		13,689		1,914		2002		(l	)
7413A-C Dogwood Park	Richland Hills, TX		110		623		125			111		747		858		115		2002		(l	)
7450 Tower Street	Richland Hills, TX		36		204		191			36		395		431		106		2002		(l	)
7436 Tower Street	Richland Hills, TX		57		324		162			58		485		543		118		2002		(l	)
7426 Tower Street	Richland Hills, TX		76		429		146			76		575		651		103		2002		(l	)
7427-7429 Tower Street	Richland Hills, TX		75		427		20			76		446		522		69		2002		(l	)
2840-2842 Handley Ederville Rd	Richland Hills, TX		112		635		71			113		705		818		124		2002		(l	)
7451-7477 Airport Freeway	Richland Hills, TX		256		1,453		218			259		1,668		1,927		315		2002		(l	)
7415 Whitehall Street	Richland Hills, TX		372		2,107		218			375		2,322		2,697		413		2002		(l	)
7450 Whitehall Street	Richland Hills, TX		104		591		110			105		700		805		103		2002		(l	)
300 Wesley Way	Richland Hills, TX		208		1,181		18			211		1,196		1,407		187		2002		(l	)
825-827 Avenue H(d)	Arlington, TX		600		3,006		248			604		3,250		3,854		670		2004		(l	)
1013-31 Avenue M	Grand Prairie, TX		300		1,504		83			302		1,585		1,887		332		2004		(l	)
1172-84 113th Street(d)	Grand Prairie, TX		700		3,509		156			704		3,661		4,365		670		2004		(l	)
1200-16 Avenue H(d)	Arlington, TX		600		2,846		92			604		2,934		3,538		588		2004		(l	)
1322-66 N. Carrier Parkway(e)	Grand Prairie, TX		1,000		5,012		163			1,006		5,169		6,175		929		2004		(l	)
2401-2407 Centennial Dr.	Arlington, TX		600		2,534		209			604		2,739		3,343		564		2004		(l	)
3111 West Commerce Street	Dallas, TX		1,000		3,364		63			1,011		3,416		4,427		692		2004		(l	)
9150 West Royal Lane	Irving, TX		818		3,767		278			820		4,043		4,863		617		2005		(l	)
13800 Senlac Drive	Farmers Ranch, TX		823		4,042		12			825		4,052		4,877		781		2005		(l	)
801-831 S. Great Southwest Pkwy(g)	Grand Prairie, TX		2,581		16,556		635			2,586		17,186		19,772		4,454		2005		(l	)
801-842 Heinz Way	Grand Prairie, TX		599		3,327		142			601		3,467		4,068		612		2005		(l	)
901-937 Heinz Way	Grand Prairie, TX		493		2,758		(14	)		481		2,756		3,237		537		2005		(l	)
2900 Avenue E	Arlington, TX		296		—		2,054			296		2,054		2,350		194		2005		(l	)
7451 Dogwood Park	Richland Hills, TX		133		753		25			134		777		911		129		2002		(l	)
2104 Hutton Drive	Carrolton, TX		246		1,393		149			249		1,539		1,788		296		2001		(l	)
3301 Century Circle	Irving, TX		760		3,856		(16	)		771		3,829		4,600		203		2007		(l	)

S-5

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08							Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and					Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements			Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
202-210 N Great Southwest Prkwy	Grand Prairie, TX		870		2,754		75			892		2,807			3,699		165		2008		(l	)
3730 Wheeler Avenue	Fort Smith, AR		720		2,800		28			726		2,822			3,548		244		2006		(l	)
First Garland District Center 2	Garland, TX		1,912		—		14,459			1,947		14,424			16,371		337		2008		(l	)
Denver
4785 Elati	Denver, CO		173		981		89			175		1,068			1,243		312		1997		(l	)
4770 Fox Street	Denver, CO		132		750		74			134		822			956		229		1997		(l	)
3871 Revere	Denver, CO		361		2,047		620			368		2,660			3,028		828		1997		(l	)
4570 Ivy Street	Denver, CO		219		1,239		171			220		1,409			1,629		418		1997		(l	)
5855 Stapleton Drive North	Denver, CO		288		1,630		228			290		1,856			2,146		544		1997		(l	)
5885 Stapleton Drive North	Denver, CO		376		2,129		279			380		2,404			2,784		670		1997		(l	)
5977-5995 North Broadway	Denver, CO		268		1,518		374			271		1,889			2,160		533		1997		(l	)
2952-5978 North Broadway	Denver, CO		414		2,346		831			422		3,169			3,591		923		1997		(l	)
4721 Ironton Street	Denver, CO		232		1,313		710			236		2,019			2,255		765		1997		(l	)
445 Bryant Street	Denver, CO		1,829		10,219		1,870			1,829		12,089			13,918		3,315		1998		(l	)
East 47th Drive — A	Denver, CO		441		2,689		(31	)		441		2,658			3,099		782		1997		(l	)
9500 West 49th Street — A	Wheatridge, CO		283		1,625		243			287		1,864			2,151		737		1997		(l	)
9500 West 49th Street — B	Wheatridge, CO		225		1,272		108			227		1,378			1,605		390		1997		(l	)
9500 West 49th Street — C	Wheatridge, CO		600		3,409		100			601		3,508			4,109		1,022		1997		(l	)
9500 West 49th Street — D	Wheatridge, CO		246		1,537		115			247		1,651			1,898		474		1997		(l	)
451-591 East 124th Avenue	Littleton, CO		383		2,145		815			383		2,960			3,343		1,172		1997		(l	)
608 Garrison Street	Lakewood, CO		265		1,501		376			269		1,873			2,142		548		1997		(l	)
610 Garrison Street	Lakewood, CO		264		1,494		350			268		1,840			2,108		529		1997		(l	)
15000 West 6th Avenue	Golden, CO		913		5,174		1,096			918		6,265			7,183		2,013		1997		(l	)
14998 West 6th Avenue Bldg E	Golden, CO		565		3,199		239			570		3,433			4,003		984		1997		(l	)
14998 West 6th Avenue Bldg F	Englewood, CO		269		1,525		31			273		1,552			1,825		435		1997		(l	)
12503 East Euclid Drive	Denver, CO		1,208		6,905		947			1,208		7,852			9,060		2,388		1997		(l	)
6547 South Racine Circle	Denver, CO		739		4,241		406			739		4,647			5,386		1,322		1997		(l	)
1600 South Abilene	Aurora, CO		465		2,633		67			467		2,698			3,165		763		1997		(l	)
1620 South Abilene	Aurora, CO		268		1,520		70			270		1,588			1,858		447		1997		(l	)
1640 South Abilene	Aurora, CO		368		2,085		104			382		2,175			2,557		611		1997		(l	)
13900 East Florida Ave	Aurora, CO		189		1,071		115			190		1,185			1,375		340		1997		(l	)
11701 East 53rd Avenue	Denver, CO		416		2,355		193			422		2,542			2,964		751		1997		(l	)
5401 Oswego Street	Denver, CO		273		1,547		428			278		1,970			2,248		695		1997		(l	)
3811 Joilet	Denver, CO		735		4,166		448			752		4,597			5,349		1,212		1998		(l	)
14818 West 6th Avenue Bldg A	Golden, CO		468		2,799		391			468		3,190			3,658		910		1997		(l	)
14828 West 6th Avenue Bldg B	Golden, CO		503		2,942		379			503		3,321			3,824		1,053		1997		(l	)
12055 E 49th Ave/4955 Peoria	Denver, CO		298		1,688		499			305		2,180	��		2,485		669		1998		(l	)
4940-4950 Paris	Denver, CO		152		861		184			156		1,041			1,197		270		1998		(l	)
4970 Paris	Denver, CO		95		537		121			97		656			753		168		1998		(l	)
7367 South Revere Parkway	Englewood, CO		926		5,124		755			934		5,871			6,805		1,554		1998		(l	)
8200 East Park Meadows Drive(d)	Lone Tree, CO		1,297		7,348		976			1,304		8,317			9,621		1,851		2000		(l	)
3250 Quentin(d)	Aurora, CO		1,220		6,911		457			1,230		7,358			8,588		1,538		2000		(l	)
8835 W. 116th Street	Broomfield, CO		1,151		6,523		975			1,304		7,345			8,649		1,145		2003		(l	)

S-6

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
18150 E. 32nd Street	Aurora, CO		563		3,188		803			572		3,982		4,554		1,003		2004		(l	)
8820 W. 116th Street	Broomfield, CO		338		1,918		282			372		2,166		2,538		321		2003		(l	)
7005 East 46th Avenue	Denver, CO		512		2,025		19			517		2,039		2,556		254		2005		(l	)
Hilltop Business Center I — Bldg. B	Littleton, CO		739		—		3,536			781		3,494		4,275		852		2000		(l	)
Jeffco Business Center A	Broomfield, CO		312		—		1,404			370		1,346		1,716		243		2001		(l	)
Park Centre A	Westminister, CO		441		—		4,489			441		4,489		4,930		1,396		2000		(l	)
Park Centre B	Westminister, CO		374		—		3,156			374		3,156		3,530		684		2000		(l	)
Park Centre C	Westminister, CO		374		—		2,924			374		2,924		3,298		670		2000		(l	)
Park Centre D	Westminister, CO		441		—		3,839			441		3,839		4,280		955		2001		(l	)
4001 Salazar Way	Frederick, CO		1,271		6,508		26			1,276		6,529		7,805		755		2006		(l	)
1690 S. Abilene	Aurora, CO		406		2,814		83			411		2,892		3,303		372		2006		(l	)
9586 Interstate 25 East Frontage	Longmont, CO		898		5,038		12			967		4,981		5,948		643		2005		(l	)
555 Corporate Circle	Golden, CO		397		2,673		(51	)		448		2,571		3,019		280		2006		(l	)
Detroit
238 Executive Drive	Troy, MI		52		173		494			100		619		719		553		1994		(l	)
301 Executive Drive	Troy, MI		71		293		731			133		962		1,095		880		1994		(l	)
449 Executive Drive	Troy, MI		125		425		1,030			218		1,362		1,580		1,217		1994		(l	)
501 Executive Drive	Troy, MI		71		236		678			129		856		985		570		1994		(l	)
451 Robbins Drive	Troy, MI		96		448		874			192		1,226		1,418		1,089		1994		(l	)
1095 Crooks Road	Troy, MI		331		1,017		2,225			360		3,213		3,573		1,531		1994		(l	)
1416 Meijer Drive	Troy, MI		94		394		520			121		887		1,008		624		1994		(l	)
1624 Meijer Drive	Troy, MI		236		1,406		940			373		2,209		2,582		1,566		1994		(l	)
1972 Meijer Drive	Troy, MI		315		1,301		738			372		1,982		2,354		1,334		1994		(l	)
1621 Northwood Drive	Troy, MI		85		351		1,028			215		1,249		1,464		1,140		1994		(l	)
1707 Northwood Drive	Troy, MI		95		262		1,383			239		1,501		1,740		1,042		1994		(l	)
1788 Northwood Drive	Troy, MI		50		196		546			103		689		792		605		1994		(l	)
1821 Northwood Drive	Troy, MI		132		523		757			220		1,192		1,412		1,161		1994		(l	)
1826 Northwood Drive	Troy, MI		55		208		484			103		644		747		551		1994		(l	)
1864 Northwood Drive	Troy, MI		57		190		437			107		577		684		572		1994		(l	)
2277 Elliott Avenue	Troy, MI		48		188		503			104		635		739		579		1994		(l	)
2451 Elliott Avenue	Troy, MI		78		319		779			164		1,012		1,176		910		1994		(l	)
2730 Research Drive	Rochester Hills, MI		903		4,215		1,402			903		5,617		6,520		3,200		1994		(l	)
2791 Research Drive	Rochester Hills, MI		557		2,731		719			560		3,447		4,007		1,980		1994		(l	)
2871 Research Drive	Rochester Hills, MI		324		1,487		651			327		2,135		2,462		1,158		1994		(l	)
3011 Research Drive	Rochester Hills, MI		457		2,104		406			457		2,510		2,967		1,625		1994		(l	)
2870 Technology Drive	Rochester Hills, MI		275		1,262		283			279		1,541		1,820		984		1994		(l	)
2900 Technology Drive	Rochester Hills, MI		214		977		536			219		1,508		1,727		863		1994		(l	)
2930 Technology Drive	Rochester Hills, MI		131		594		379			138		966		1,104		519		1994		(l	)
2950 Technology Drive	Rochester Hills, MI		178		819	��	374			185		1,186		1,371		648		1994		(l	)
23014 Commerce Drive	Farmington Hills, MI		39		203		178			56		364		420		241		1994		(l	)
23028 Commerce Drive	Farmington Hills,1 MI		98		507		278			125		758		883		520		1994		(l	)
23035 Commerce Drive	Farmington Hills, MI		71		355		263			93		596		689		435		1994		(l	)
23042 Commerce Drive	Farmintgon Hills, MI		67		277		310			89		565		654		410		1994		(l	)

S-7

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or		Gross Amount Carried
			(b)			Completion		At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation				Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision		Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
23065 Commerce Drive	Farmington Hills, MI		71		408		207		93		593		686		402		1994		(l	)
23070 Commerce Drive	Farmington Hills, MI		112		442		346		125		775		900		541		1994		(l	)
23079 Commerce Drive	Farmington Hills, MI		68		301		216		79		506		585		347		1994		(l	)
23093 Commerce Drive	Farmington Hills, MI		211		1,024		844		295		1,784		2,079		1,295		1994		(l	)
23135 Commerce Drive	Farmington Hills, MI		146		701		344		158		1,033		1,191		617		1994		(l	)
23163 Commerce Drive	Farmington Hills, MI		111		513		342		138		828		966		520		1994		(l	)
23177 Commerce Drive	Farmington Hills, MI		175		1,007		596		254		1,524		1,778		977		1994		(l	)
23206 Commerce Drive	Farmington Hills, MI		125		531		349		137		868		1,005		587		1994		(l	)
23370 Commerce Drive	Farmington Hills, MI		59		233		174		66		400		466		315		1994		(l	)
32450 N Avis Drive	Madison Heights, MI		281		1,590		193		286		1,778		2,064		559		1996		(l	)
12707 Eckles Road	Plymouth Township, MI		255		1,445		235		267		1,668		1,935		484		1996		(l	)
9300-9328 Harrison Rd	Romulus, MI		147		834		404		154		1,231		1,385		332		1996		(l	)
9330-9358 Harrison Rd	Romulus, MI		81		456		277		85		729		814		214		1996		(l	)
28420-28448 Highland Rd	Romulus, MI		143		809		172		149		975		1,124		327		1996		(l	)
28450-28478 Highland Rd	Romulus, MI		81		461		258		85		715		800		198		1996		(l	)
28421-28449 Highland Rd	Romulus, MI		109		617		404		114		1,016		1,130		285		1996		(l	)
28451-28479 Highland Rd	Romulus, MI		107		608		322		112		925		1,037		271		1996		(l	)
28825-28909 Highland Rd	Romulus, MI		70		395		314		73		706		779		215		1996		(l	)
28933-29017 Highland Rd	Romulus, MI		112		634		322		117		951		1,068		283		1996		(l	)
28824-28908 Highland Rd	Romulus, MI		134		760		221		140		975		1,115		295		1996		(l	)
28932-29016 Highland Rd	Romulus, MI		123		694		311		128		1,000		1,128		346		1996		(l	)
9710-9734 Harrison Rd	Romulus, MI		125		706		95		130		796		926		239		1996		(l	)
9740-9772 Harrison Rd	Romulus, MI		132		749		235		138		978		1,116		292		1996		(l	)
9840-9868 Harrison Rd	Romulus, MI		144		815		169		151		977		1,128		296		1996		(l	)
9800-9824 Harrison Rd	Romulus, MI		117		664		127		123		785		908		244		1996		(l	)
29265-29285 Airport Dr	Romulus, MI		140		794		214		147		1,001		1,148		302		1996		(l	)
29185-29225 Airport Dr	Romulus, MI		140		792		307		146		1,093		1,239		326		1996		(l	)
29149-29165 Airport Dr	Romulus, MI		216		1,225		379		226		1,594		1,820		547		1996		(l	)
29101-29115 Airport Dr	Romulus, MI		130		738		297		136		1,029		1,165		340		1996		(l	)
29031-29045 Airport Dr	Romulus, MI		124		704		168		130		866		996		261		1996		(l	)
29050-29062 Airport Dr	Romulus, MI		127		718		117		133		829		962		252		1996		(l	)
29120-29134 Airport Dr	Romulus, MI		161		912		245		169		1,149		1,318		335		1996		(l	)
29200-29214 Airport Dr	Romulus, MI		170		963		300		178		1,255		1,433		372		1996		(l	)
9301-9339 Middlebelt Rd	Romulus, MI		124		703		289		130		986		1,116		308		1996		(l	)
26980 Trolley Industrial Drive	Taylor, MI		450		2,550		935		463		3,472		3,935		1,061		1997		(l	)
32975 Capitol Avenue	Livonia, MI		135		748		332		144		1,071		1,215		338		1998		(l	)
2725 S. Industrial Highway	Ann Arbor, MI		660		3,654		408		704		4,018		4,722		1,075		1998		(l	)
32920 Capitol Avenue	Livonia, MI		76		422		113		82		529		611		141		1998		(l	)
11923 Brookfield Avenue	Livonia, MI		120		665		278		128		935		1,063		259		1998		(l	)
11965 Brookfield Avenue	Livonia, MI		120		665		67		128		724		852		192		1998		(l	)
13405 Stark Road	Livonia, MI		46		254		136		49		387		436		140		1998		(l	)
1170 Chicago Road	Troy, MI		249		1,380		255		266		1,618		1,884		419		1998		(l	)
1200 Chicago Road	Troy, MI		268		1,483		274		286		1,739		2,025		446		1998		(l	)

S-8

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or		Gross Amount Carried
			(b)			Completion		At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation				Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision		Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
450 Robbins Drive	Troy, MI		166		920		260		178		1,168		1,346		299		1998		(l	)
1230 Chicago Road	Troy, MI		271		1,498		156		289		1,636		1,925		433		1998		(l	)
12886 Westmore Avenue	Livonia, MI		190		1,050		194		202		1,232		1,434		323		1998		(l	)
12898 Westmore Avenue	Livonia, MI		190		1,050		235		202		1,273		1,475		365		1998		(l	)
33025 Industrial Road	Livonia, MI		80		442		92		85		529		614		132		1998		(l	)
47711 Clipper Street	Plymouth Township, MI		539		2,983		265		575		3,212		3,787		852		1998		(l	)
32975 Industrial Road	Livonia, MI		160		887		343		171		1,219		1,390		413		1998		(l	)
32985 Industrial Road	Livonia, MI		137		761		154		147		905		1,052		245		1998		(l	)
32995 Industrial Road	Livonia, MI		160		887		187		171		1,063		1,234		270		1998		(l	)
12874 Westmore Avenue	Livonia, MI		137		761		239		147		990		1,137		307		1998		(l	)
33067 Industrial Road	Livonia, MI		160		887		314		171		1,190		1,361		346		1998		(l	)
1775 Bellingham	Troy, MI		344		1,902		297		367		2,176		2,543		556		1998		(l	)
1785 East Maple	Troy, MI		92		507		95		98		596		694		153		1998		(l	)
1807 East Maple	Troy, MI		321		1,775		371		342		2,125		2,467		533		1998		(l	)
980 Chicago	Troy, MI		206		1,141		176		220		1,303		1,523		330		1998		(l	)
1840 Enterprise Drive	Rochester Hills, MI		573		3,170		346		611		3,478		4,089		935		1998		(l	)
1885 Enterprise Drive	Rochester Hills, MI		209		1,158		146		223		1,290		1,513		338		1998		(l	)
1935-55 Enterprise Drive	Rochester Hills, MI		1,285		7,144		704		1,371		7,762		9,133		2,088		1998		(l	)
5500 Enterprise Court	Warren, MI		675		3,737		646		721		4,337		5,058		1,199		1998		(l	)
750 Chicago Road	Troy, MI		323		1,790		483		345		2,251		2,596		571		1998		(l	)
800 Chicago Road	Troy, MI		283		1,567		351		302		1,899		2,201		478		1998		(l	)
850 Chicago Road	Troy, MI		183		1,016		261		196		1,264		1,460		331		1998		(l	)
2805 S. Industrial Highway	Ann Arbor, MI		318		1,762		638		340		2,378		2,718		601		1998		(l	)
6833 Center Drive	Sterling Heights, MI		467		2,583		218		493		2,775		3,268		754		1998		(l	)
32201 North Avis Drive	Madison Heights, MI		345		1,911		232		349		2,139		2,488		567		1998		(l	)
1100 East Mandoline Road	Madison Heights, MI		888		4,915		1,023		897		5,929		6,826		1,522		1998		(l	)
30081 Stephenson Highway	Madison Heights, MI		271		1,499		349		274		1,845		2,119		494		1998		(l	)
1120 John A. Papalas Drive(e)	Lincold Park, MI		366		3,241		1,040		469		4,178		4,647		1,098		1998		(l	)
4872 S. Lapeer Road	Lake Orion Twsp, MI		1,342		5,441		2,215		1,412		7,586		8,998		2,928		1999		(l	)
1400 Allen Drive	Troy, MI		209		1,154		254		212		1,405		1,617		290		2000		(l	)
1408 Allen Drive	Troy, MI		151		834		133		153		965		1,118		188		2000		(l	)
1305 Stephenson Hwy	Troy, MI		345		1,907		255		350		2,157		2,507		409		2000		(l	)
32505 Industrial Drive	Madison Heights, MI		345		1,910		501		351		2,405		2,756		672		2000		(l	)
1799-1813 Northfield Drive(d)	Rochester Hills, MI		481		2,665		291		490		2,947		3,437		591		2000		(l	)
32200 N. Avis	Madison Heights, MI		503		3,367		1,348		503		4,715		5,218		412		2005		(l	)
100 Kay Industrial	Orion, MI		677		2,018		404		685		2,414		3,099		650		2005		(l	)
1849 West Maple Road	Troy, MI		1,688		2,790		30		1,700		2,808		4,508		435		2005		(l	)
42555 Merrill Road	Sterling Heights, MI		1,080		2,300		3,702		1,090		5,992		7,082		746		2006		(l	)
28435 Automation Blvd.	Wixom, MI		621		3,804		628		3,797		4,425		456				2004		(l	)
2441 N. Opdyke Road	Auburn Hills, MI		530		737		16		538		745		1,283		147		2006		(l	)
200 Northpointe Drive	Orion Township, MI		723		2,063		36		734		2,088		2,822		241		2006		(l	)
32500 Capitol Avenue	Livonia, MI		258		1,032		324		260		1,354		1,614		99		2005		(l	)
32650 Capitol Avenue	Livonia, MI		282		1,128		55		284		1,181		1,465		113		2005		(l	)

S-9

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
11800 Sears Drive	Livonia, MI		693		1,507		2,053			703		3,550		4,253		521		2005		(l	)
1099 Church Road	Troy, MI		702		1,332		657			1,316		1,375		2,691		400		2005		(l	)
Houston
2102-2314 Edwards Street	Houston, TX		348		1,973		1,572			382		3,511		3,893		919		1997		(l	)
3351 Rauch St	Houston, TX		272		1,541		203			278		1,738		2,016		470		1997		(l	)
3851 Yale St	Houston, TX		413		2,343		601			425		2,932		3,357		913		1997		(l	)
3337-3347 Rauch Street	Houston, TX		227		1,287		215			233		1,496		1,729		403		1997		(l	)
8505 N Loop East	Houston, TX		439		2,489		729			449		3,208		3,657		906		1997		(l	)
4749-4799 Eastpark Dr	Houston, TX		594		3,368		1,151			611		4,502		5,113		1,148		1997		(l	)
4851 Homestead Road	Houston, TX		491		2,782		867			504		3,636		4,140		994		1997		(l	)
3365-3385 Rauch Street	Houston, TX		284		1,611		390			290		1,995		2,285		518		1997		(l	)
5050 Campbell Road	Houston, TX		461		2,610		405			470		3,006		3,476		816		1997		(l	)
4300 Pine Timbers	Houston, TX		489		2,769		568			499		3,327		3,826		922		1997		(l	)
2500-2530 Fairway Park Drive	Houston, TX		766		4,342		1,007			792		5,323		6,115		1,337		1997		(l	)
6550 Longpointe	Houston, TX		362		2,050		516			370		2,558		2,928		710		1997		(l	)
1815 Turning Basin Dr	Houston, TX		487		2,761		584			531		3,301		3,832		896		1997		(l	)
1819 Turning Basin Dr	Houston, TX		231		1,308		537			251		1,825		2,076		542		1997		(l	)
1805 Turning Basin Drive	Houston, TX		564		3,197		721			616		3,866		4,482		1,051		1997		(l	)
9835A Genard Road	Houston, TX		1,505		8,333		3,246			1,581		11,503		13,084		2,373		1999		(l	)
9835B Genard Road	Houston, TX		245		1,357		646			256		1,992		2,248		414		1999		(l	)
11505 State Highway 225	LaPorte City, TX		940		4,675		615			940		5,290		6,230		672		2005		(l	)
South by Southwest	Sugarland , TX		608		3,679		270			617		3,940		4,557		277		2007		(l	)
7230-7238 Wynnwood	Houston, TX		254		764		94			259		853		1,112		120		2007		(l	)
7240-7248 Wynnwood	Houston, TX		271		726		77			276		798		1,074		86		2007		(l	)
7250-7260 Wynnwood	Houston, TX		200		481		35			203		513		716		52		2007		(l	)
1500 E. Main	LaPorte City, TX		201		1,328		24			204		1,349		1,553		328		2005		(l	)
6400 Long Point	Houston, TX		188		898		1			188		899		1,087		120		2007		(l	)
12705 S Kirkwood Ste100-150	Houston, TX		154		626		9			155		634		789		67		2007		(l	)
12705 S Kirkwood Ste200-220	Houston, TX		404		1,698		93			413		1,782		2,195		195		2007		(l	)
8850 Jameel	Houston, TX		171		826		65			171		891		1,062		103		2007		(l	)
8800 Jameel	Houston, TX		163		798		4			163		802		965		108		2007		(l	)
8700 Jameel	Houston, TX		170		1,020		128			170		1,148		1,318		88		2007		(l	)
8600 Jameel	Houston, TX		163		818		(23	)		163		795		958		85		2007		(l	)
Indianapolis
7901 West 21st St.	Indianapolis, IN		1,048		6,027		300			1,048		6,327		7,375		1,833		1997		(l	)
1445 Brookville Way	Indianapolis, IN		459		2,603		767			476		3,353		3,829		1,151		1996		(l	)
1440 Brookville Way	Indianapolis, IN		665		3,770		1,091			685		4,841		5,526		1,683		1996		(l	)
1240 Brookville Way	Indianapolis, IN		247		1,402		310			258		1,701		1,959		549		1996		(l	)
1345 Brookville Way	Indianapolis, IN	(p)	586		3,321		865			601		4,171		4,772		1,409		1996		(l	)
1350 Brookville Way	Indianapolis, IN		205		1,161		291			212		1,445		1,657		444		1996		(l	)
1341 Sadlier Circle E Dr	Indianapolis, IN	(q)	131		743		255			136		993		1,129		372		1996		(l	)
1322-1438 Sadlier Circle E Dr	Indianapolis, IN	(q)	145		822		208			152		1,023		1,175		325		1996		(l	)
1327-1441 Sadlier Circle E Dr	Indianapolis, IN	(q)	218		1,234		394			225		1,621		1,846		528		1996		(l	)

S-10

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
1304 Sadlier Circle E Dr	Indianapolis, IN	(q)	71		405		112			75		513		588		173		1996		(l	)
1402 Sadlier Circle E Dr	Indianapolis, IN	(q)	165		934		367			171		1,295		1,466		450		1996		(l	)
1504 Sadlier Circle E Dr	Indianapolis, IN	(q)	219		1,238		390			226		1,621		1,847		460		1996		(l	)
1311 Sadlier Circle E Dr	Indianapolis, IN	(q)	54		304		109			57		410		467		136		1996		(l	)
1365 Sadlier Circle E Dr	Indianapolis, IN	(q)	121		688		295			126		978		1,104		318		1996		(l	)
1352-1354 Sadlier Circle E Dr	Indianapolis, IN	(q)	178		1,008		396			184		1,398		1,582		496		1996		(l	)
1335 Sadlier Circle E Dr	Indianapolis, IN	(q)	81		460		326			85		782		867		242		1996		(l	)
1327 Sadlier Circle E Dr	Indianapolis, IN	(q)	52		295		51			55		343		398		107		1996		(l	)
1425 Sadlier Circle E Dr	Indianapolis, IN	(q)	21		117		39			23		154		177		48		1996		(l	)
6951 E 30th St	Indianapolis, IN		256		1,449		192			265		1,632		1,897		543		1996		(l	)
6701 E 30th St	Indianapolis, IN		78		443		59			82		498		580		154		1996		(l	)
6737 E 30th St	Indianapolis, IN		385		2,181		305			398		2,473		2,871		851		1996		(l	)
1225 Brookville Way	Indianapolis, IN		60		—		461			68		453		521		133		1997		(l	)
6555 E 30th St	Indianapolis, IN		484		4,760		1,616			484		6,376		6,860		2,101		1996		(l	)
8402-8440 E 33rd St	Indianapolis, IN		222		1,260		561			230		1,813		2,043		550		1996		(l	)
8520-8630 E 33rd St	Indianapolis, IN		326		1,848		649			336		2,487		2,823		776		1996		(l	)
8710-8768 E 33rd St	Indianapolis, IN		175		993		417			187		1,398		1,585		414		1996		(l	)
3316-3346 N. Pagosa Court	Indianapolis, IN		325		1,842		522			335		2,354		2,689		834		1996		(l	)
6751 E 30th St	Indianapolis, IN		728		2,837		356			741		3,180		3,921		917		1997		(l	)
8525 E. 33rd Street	Indianapolis, IN		1,300		2,091		586			1,308		2,669		3,977		518		2003		(l	)
5705-97 Park Plaza Ct	Indianapolis, IN	(r)	600		2,194		421			609		2,606		3,215		483		2003		(l	)
9319-9341 Castlegate Drive	Indianapolis, IN		530		1,235		1,017			544		2,238		2,782		656		2003		(l	)
9332-9350 Castlegate Drive	Indianapolis, IN		420		646		701			429		1,338		1,767		428		2003		(l	)
1133 Northwest L Street	Richmond, IN	(s)	201		1,358		68			208		1,419		1,627		450		2006		(l	)
1380 Perry Road	Plainfield, IN		781		5,156		136			785		5,288		6,073		735		2005		(l	)
9210 East 146th Street	Noblesville, IN		66		684		818			66		1,502		1,568		674		1998		(l	)
Helmer Spec BTS	Noblesville, IN		647		—		3,855			743		3,759		4,502		126		2007		(l	)
Inland Empire
3411 N Perris Blvd	Riverside, CA		8,125		7,150		99			8,560		6,814		15,374		890		2007		(l	)
100 W Sinclair	Riverside, CA		6,042		4,298		1,095			5,617		5,818		11,435		480		2007		(l	)
14050 Day Street	Moreno Valley, CA		2,538		2,538		258			2,565		2,768		5,333		111		2008		(l	)
12925 Marlay Avenue	Fontana, CA		6,072		7,891		(27	)		6,090		7,846		13,936		329		2008		(l	)
Los Angeles
350-390 Manville St.	Compton, CA		2,300		3,768		111			2,313		3,866		6,179		738		2004		(l	)
1944 Vista Bella Way	Rancho Dominguez, CA		1,746		3,148		584			1,822		3,656		5,478		539		2005		(l	)
2000 Vista Bella Way	Rancho Dominguez, CA		817		1,673		295			853		1,932		2,785		297		2005		(l	)
2835 East Ana Street Drive	Rancho Dominguez, CA		1,682		2,750		141			1,772		2,801		4,573		535		2005		(l	)
665 N. Baldwin Park Blvd	City of Industry, CA		2,124		5,219		1,517			2,143		6,717		8,860		534		2006		(l	)
27801 Avenue Scott	Santa Clarita, CA		2,890		7,020		576			2,902		7,584		10,486		639		2006		(l	)
2610 & 2660 Columbia Street	Torrance, CA		3,008		5,826		(15	)		3,031		5,788		8,819		434		2006		(l	)
433 Alaska Avenue	Torrance, CA		681		168		5			684		170		854		53		2006		(l	)
21730-21748 Marilla Street	Chatsworth, CA		2,585		3,210		145			2,608		3,332		5,940		287		2007		(l	)
8015 Paramount	Pico Riviera, CA		3,616		3,902		61			3,657		3,922		7,579		315		2007		(l	)

S-11

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
3365 E. Slauson	Los Angeles, CA		2,367		3,243		40			2,396		3,254		5,650		276		2007		(l	)
3015 E Ana & 18744 Reyes	Los Angeles, CA		19,678		9,321		7,361			20,144		16,216		36,360		731		2007		(l	)
19067 Reyes Ave	Rancho Dominguez, CA		9,281		3,920		119			9,381		3,939		13,320		353		2007		(l	)
1250 Rancho Conejo Blvd	Thousand Oaks, CA		1,435		779		36			1,441		809		2,250		63		2007		(l	)
1260 Rancho Conejo Blvd	Thousand Oaks, CA		1,353		722		226			1,359		942		2,301		56		2007		(l	)
1270 Rancho Conejo Blvd	Thousand Oaks, CA		1,224		716		21			1,229		732		1,961		66		2007		(l	)
1280 Rancho Conejo Blvd	Thousand Oaks, CA		2,043		3,408		40			2,051		3,440		5,491		227		2007		(l	)
1290 Rancho Conejo Blvd	Thousand Oaks, CA		1,754		2,949		35			1,761		2,977		4,738		197		2007		(l	)
1011 Rancho Conejo	Thousand Oaks, CA		7,717		2,518		46			7,752		2,528		10,280		192		2008		(l	)
2300 Corporate Center Drive	Thousand Oaks, CA		6,506		4,885		51			6,541		4,901		11,442		268		2008		(l	)
1901 Raymond Ave SW — Berg	Renton, WA	(t)	4,458		2,659		211			4,594		2,734		7,328		78		2008		(l	)
19014 64th Ave South	Kent, WA		1,990		3,979		147			2,042		4,075		6,117		103		2008		(l	)
18640 68th Ave South	Kent, WA	(u)	1,218		1,950		98			1,258		2,008		3,266		59		2008		(l	)
Puget Sound Terminal 7	Seattle, WA		9,139		0		185			9,324		—		9,324		—		2008		(l	)
19021 S Reyes Ave	Rancho Dominguez, CA		8,183		7,501		553			8,565		7,672		16,237		164		2008		(l	)
4020 S. Compton Ave	Los Angeles, CA		3,800		7,330		71			3,825		7,376		11,201		543		2006		(l	)
Sante Fe	Compton, CA		6,720		—		8,969			6,897		8,792		15,689		231		2007		(l	)
Louisville
Penske BTS	Louisville, KY		2,074		—		9,679			2,119		9,634		11,753		413		2007		(l	)
Miami
4700 NW 15th Ave	Ft.Lauderdale, FL		908		1,883		43			912		1,922		2,834		154		2007		(l	)
4710 NW 15th Ave	Ft.Lauderdale, FL		830		2,722		167			834		2,885		3,719		175		2007		(l	)
4720 NW 15th Ave	Ft.Lauderdale, FL		937		2,455		23			942		2,473		3,415		206		2007		(l	)
4740 NW 15th Ave	Ft.Lauderdale, FL		1,107		3,111		24			1,112		3,130		4,242		212		2007		(l	)
4750 NW 15th Ave	Ft.Lauderdale, FL		947		3,079		129			951		3,204		4,155		197		2007		(l	)
4800 NW 15th Ave	Ft.Lauderdale, FL		1,092		3,308		347			1,097		3,650		4,747		332		2007		(l	)
Smurfit Container	Medley, FL		857		3,428		2,762			864		6,183		7,047		175		2007		(l	)
Milwaukee
6523 N Sydney Place	Glendale, WI		172		976		352			176		1,324		1,500		421		1995		(l	)
5355 South Westridge Drive	New Berlin, WI		1,630		7,058		46			1,646		7,088		8,734		976		2004		(l	)
320-34 W. Vogel	Milwaukee, WI		506		3,199		40			508		3,237		3,745		735		2005		(l	)
4950 S. 6th Avenue	Milwaukee, WI		299		1,565		99			301		1,662		1,963		485		2005		(l	)
1711 Paramount Court	Waukesha, WI		308		1,762		41			311		1,800		2,111		231		2005		(l	)
W 140 N9059 Lilly Road	Iomonee Falls, WI		343		1,153		248			366		1,378		1,744		291		2005		(l	)
200 W. Vogel Ave., Bldg B	Milwaukee, WI		301		2,150		—			302		2,149		2,451		425		2005		(l	)
16600 West Glendale Avenue	New Berlin, WI		704		1,923		442			715		2,354		3,069		490		2006		(l	)
4921 S. 2nd Street	Milwaukee, WI		101		713		3			101		716		817		143		2005		(l	)
1500 Peebles Drive	Richland Center, WI		1,577		1,018		(211	)		1,603		781		2,384		488		2005		(l	)
2905 S 160th Street	New Berlin, WI		261		672		108			265		776		1,041		87		2007		(l	)
2855 S 160th Street	New Berlin, WI		221		628		102			225		726		951		82		2007		(l	)
2485 Commerce Drive	New Berlin, WI		483		1,516		175			491		1,683		2,174		150		2007		(l	)
14518 Whittaker Way	New Berlin, WI		437		1,082		83			445		1,157		1,602		146		2007		(l	)

S-12

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
Minneapolis/St. Paul
6201 West 111th Street	Bloomington, MN	(v)	1,358		8,622		4,719			1,499		13,200		14,699		7,340		1994		(l	)
7251-7267 Washington Avenue	Edina, MN		129		382		692			182		1,021		1,203		793		1994		(l	)
7301-7325 Washington Avenue	Edina, MN		174		391		(74	)		193		298		491		53		1994		(l	)
7101 Winnetka Avenue North	Brooklyn Park, MN		2,195		6,084		4,078			2,228		10,129		12,357		5,714		1994		(l	)
9901 West 74th Street	Eden Prairie, MN		621		3,289		3,268			639		6,539		7,178		4,029		1994		(l	)
1030 Lone Oak Road	Eagan, MN		456		2,703		617			456		3,320		3,776		1,152		1994		(l	)
1060 Lone Oak Road	Eagan, MN		624		3,700		621			624		4,321		4,945		1,588		1994		(l	)
5400 Nathan Lane	Plymouth, MN		749		4,461		923			757		5,376		6,133		1,795		1994		(l	)
10120 W 76th Street	Eden Prairie, MN		315		1,804		438			315		2,242		2,557		707		1995		(l	)
12155 Nicollet Ave	Burnsville, MN		286		—		1,731			288		1,729		2,017		573		1995		(l	)
4100 Peavey Road	Chaska, MN		277		2,261		844			277		3,105		3,382		969		1996		(l	)
5205 Highway 169	Plymouth, MN		446		2,525		988			740		3,219		3,959		967		1996		(l	)
7100-7198 Shady Oak Road	Eden Prairie, MN		715		4,054		1,153			736		5,186		5,922		1,478		1996		(l	)
7500-7546 Washington Square	Eden Prairie, MN		229		1,300		741			235		2,035		2,270		535		1996		(l	)
7550-7558 Washington Square	Eden Prairie, MN		153		867		178			157		1,041		1,198		296		1996		(l	)
5240-5300 Valley Industrial Blvd S	Shakopee, MN		362		2,049		1,022			371		3,062		3,433		1,108		1996		(l	)
7102 Winnetka Ave. North	Brooklyn Park, MN		1,275		—		6,849			1,343		6,781		8,124		325		2007		(l	)
1157 Valley Park Drive	Shakopee, MN		760		—		6,362			888		6,234		7,122		1,428		1999		(l	)
500-530 Kasota Avenue SE	Minneapolis, MN		415		2,354		844			434		3,179		3,613		944		1998		(l	)
2530-2570 Kasota Avenue	St. Paul, MN		407		2,308		972			467		3,220		3,687		848		1998		(l	)
9600 West 76th Street	Eden Prairie, MN		1,000		2,450		44			1,034		2,460		3,494		367		2004		(l	)
9700 West 76th Street	Eden Prairie, MN		1,000		2,709		138			1,038		2,809		3,847		390		2004		(l	)
5017 Boone Avenue North	New Hope, MN	(w)	1,000		1,599		58			1,009		1,648		2,657		550		2005		(l	)
2300 West Highway 13(I-35 Dist Ctr)	Burnsville, MN		2,517		6,069		(416	)		2,524		5,646		8,170		1,605		2005		(l	)
1087 Park Place	Shakopee, MN		1,195		4,891		15			1,198		4,903		6,101		896		2005		(l	)
5391 12th Avenue SE	Shakopee, MN		1,392		8,149		(18	)		1,395		8,128		9,523		1,082		2005		(l	)
4701 Valley Industrial Boulevard	Shakopee, MN		1,296		7,157		(81	)		1,299		7,073		8,372		1,255		2005		(l	)
Park 2000 III	Shakopee, MN		590		—		5,721			590		5,721		6,311		1,075		1998		(l	)
7600 69th Avenue	Greenfield, MN		1,500		8,328		1,808			1,510		10,126		11,636		1,676		2004		(l	)
316 Lake Hazeltine Drive	Chaska, MN		714		944		166			729		1,095		1,824		304		2006		(l	)
1225 Highway 169 North	Plymouth, MN		1,190		1,979		60			1,207		2,022		3,229		344		2006		(l	)
139 Eva Street	St. Paul, MN		2,132		3,105		90			2,175		3,152		5,327		50		2008		(l	)
9200 10th Ave	Golden Valley, MN		892		2,306		126			902		2,422		3,324		312		2007		(l	)
Nashville
3099 Barry Drive	Portland, TN		418		2,368		164			421		2,529		2,950		756		1996		(l	)
3150 Barry Drive	Portland, TN		941		5,333		5,946			981		11,239		12,220		1,802		1996		(l	)
5599 Highway 31 West	Portland, TN		564		3,196		166			571		3,355		3,926		1,006		1996		(l	)
1650 Elm Hill Pike	Nashville, TN		329		1,867		330			332		2,194		2,526		643		1997		(l	)
1931 Air Lane Drive	Nashville, TN		489		2,785		288			493		3,069		3,562		847		1997		(l	)
4640 Cummings Park	Nashville, TN		360		2,040		306			365		2,341		2,706		513		1999		(l	)
1740 River Hills Drive	Nashville, TN		848		4,383		1,052			888		5,395		6,283		1,370		2005		(l	)
Royal Park Business Center — 211 Ellery Ct	Nashville, TN		606		3,192		524			616		3,706		4,322		358		2007		(l	)

S-13

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or		Gross Amount Carried
			(b)			Completion		At Close of Period 12/31/08							Accumulated
	Location	(a)	Initial Cost			and Valuation				Building and					Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision		Land		Improvements			Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
												��
600 Greene Drive	Greenville, KY		294		8,570		3		296		8,571			8,867		784		2008		(l	)
Northern New Jersey
14 World’s Fair Drive	Franklin, NJ		483		2,735		643		503		3,358			3,861		1,046		1997		(l	)
12 World’s Fair Drive	Franklin, NJ		572		3,240		530		593		3,749			4,342		1,145		1997		(l	)
22 World’s Fair Drive	Franklin, NJ		364		2,064		656		375		2,709			3,084		756		1997		(l	)
26 World’s Fair Drive	Franklin, NJ		361		2,048		376		377		2,408			2,785		713		1997		(l	)
24 World’s Fair Drive	Franklin, NJ		347		1,968		523		362		2,476			2,838		761		1997		(l	)
20 World’s Fair Drive Lot 13	Sumerset, NJ		9		—		2,543		691		1,861			2,552		396		1999		(l	)
45 Route 46	Pine Brook, NJ		969		5,491		967		978		6,449			7,427		1,424		2000		(l	)
43 Route 46	Pine Brook, NJ		474		2,686		431		479		3,112			3,591		667		2000		(l	)
39 Route 46	Pine Brook, NJ		260		1,471		198		262		1,667			1,929		342		2000		(l	)
26 Chapin Road	Pine Brook, NJ		956		5,415		697		965		6,103			7,068		1,311		2000		(l	)
30 Chapin Road	Pine Brook, NJ		960		5,440		758		969		6,189			7,158		1,437		2000		(l	)
20 Hook Mountain Road	Pine Brook, NJ		1,507		8,542		2,868		1,534		11,383			12,917		2,199		2000		(l	)
30 Hook Mountain Road	Pine Brook, NJ		389		2,206		322		396		2,521			2,917		545		2000		(l	)
55 Route 46	Pine Brook, NJ		396		2,244		196		403		2,433			2,836		537		2000		(l	)
16 Chapin Road	Pine Brook, NJ		885		5,015		508		901		5,507			6,408		1,168		2000		(l	)
20 Chapin Road	Pine Brook, NJ		1,134		6,426		525		1,154		6,931			8,085		1,502		2000		(l	)
Sayreville Lot 3	Sayreville, NJ		996		—		5,332		996		5,332			6,328		603		2003		(l	)
Sayreville Lot 4	Sayreville, NJ		944		—		4,752		944		4,752			5,696		887		2002		(l	)
309-319 Pierce Street	Somerset, NJ		1,300		4,628		1,069		1,309		5,688			6,997		903		2004		(l	)
Philadelphia
3240 S.78th Street	Philadelphia, PA		515		1,245		71		540		1,291			1,831		197		2005		(l	)
2455 Boulevard of the Generals	Norristown, PA		1200		4,800		878		1,226		5,652			6,878		256		2008		(l	)
Southpoint II	Carlisle, PA		1,500		—		12,370		2,341		11,529			13,870		427		2007		(l	)
Covington Land-E-2	Harrisburg, PA		7,022		—		57,338		7,023		57,337			64,360		455		2008		(l	)
225 Cross Farm Lane	York, PA		4,718		—		23,553		4,715		23,556			28,271		742		2007		(l	)
Phoenix
1045 South Edward Drive	Tempe, AZ		390		2,160		200		396		2,354			2,750		559		1999		(l	)
46 N. 49th Ave	Phoenix, AZ		283		1,704		800		283		2,504			2,787		545		2002		(l	)
50 South 56th Street	Chandler, AZ		1,206		3,218		79		1,207		3,296			4,503		471		2004		(l	)
4701 W. Jefferson	Phoenix, AZ		926		2,195		628		929		2,820			3,749		708		2005		(l	)
7102 W. Roosevelt	Phoenix, AZ		1,613		6,451		987		1,620		7,431			9,051		823		2006		(l	)
4137 West Adams Street	Phoenix, AZ		990		2,661		146		1,033		2,764			3,797		267		2006		(l	)
245 W Lodge	Tempe, AZ		898		3,066		68		914		3,118			4,032		203		2007		(l	)
1590 E Riverview	Phoenix, AZ		1293		5,950		69		1,292		6,020			7,312		196		2008		(l	)
Mack Arrowhead — Bldg A	Phoenix, AZ		2563		9,388		641		2,563		10,029			12,592		324		2008		(l	)
Mack Arrowhead — Bldg B	Phoenix, AZ		2709		10,970		160		2,709		11,130			13,839		324		2008		(l	)
3815 W Washington — Beltman	Phoenix, AZ	(x)	1675		4,514		199		1,772		4,616			6,388		85		2008		(l	)
9102 W. Buckeye Rd (690 91st ave)	Tolleson, AZ		1904		6,805		622		1,923		7,408			9,331		229		2008		(l	)
Salt Lake City
512 Lawndale Drive(i)	Salt Lake City, UT		2,705		15,749		2,720		2,705		18,469			21,174		5,404		1997		(l	)

S-14

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
1270 West 2320 South	West Valley, UT		138		784		184			143		963		1,106		290		1998		(l	)
1275 West 2240 South	West Valley, UT		395		2,241		474			408		2,702		3,110		859		1998		(l	)
1288 West 2240 South	West Valley, UT		119		672		160			123		828		951		266		1998		(l	)
2235 South 1300 West	West Valley, UT		198		1,120		258			204		1,372		1,576		478		1998		(l	)
1293 West 2200 South	West Valley, UT		158		896		118			163		1,009		1,172		287		1998		(l	)
1279 West 2200 South	West Valley, UT		198		1,120		95			204		1,209		1,413		319		1998		(l	)
1272 West 2240 South	West Valley, UT		336		1,905		240			347		2,134		2,481		553		1998		(l	)
1149 West 2240 South	West Valley, UT		217		1,232		100			225		1,324		1,549		368		1998		(l	)
1142 West 2320 South	West Valley, UT		217		1,232		77			225		1,301		1,526		363		1998		(l	)
Metro Business Park	West Valley, UT		2067		0		2,519			1,083		3,503		4,586		772		2000		(l	)
1815-1957 South 4650 West	Salt Lake City, UT		1,707		10,873		162			1,713		11,029		12,742		910		2006		(l	)
2100 Alexander Street	West Valley, UT		376		1,670		—			376		1,670		2,046		104		2007		(l	)
2064 Alexander Street	West Valley, UT		864		2,771		34			869		2,800		3,669		177		2007		(l	)
Bard Access System -5425 Amelia Earhart	Salt Lake City, UT		615		2,461		43			628		2,491		3,119		99		2007		(l	)
San Diego
16275 Technology Drive	San Diego, CA		2,848		8,641		42			2,859		8,672		11,531		1,044		2005		(l	)
6305 El Camino Real	Carlsbad, CA		1,590		6,360		7,496			1,590		13,856		15,446		745		2006		(l	)
8572 Spectrum Lane	San Diego, CA		806		3,225		429			807		3,653		4,460		206		2007		(l	)
13100 Gregg St	Poway, CA		1,040		4,160		474			1,073		4,601		5,674		322		2007		(l	)
2325 Camino Vida Roble	Carlsbad, CA		1,441		1,239		453			1,446		1,687		3,133		161		2006		(l	)
2335 Camino Vida Roble	Carlsbad, CA		817		762		111			821		869		1,690		131		2006		(l	)
2345 Camino Vida Roble	Carlsbad, CA		562		456		28			565		481		1,046		77		2006		(l	)
2355 Camino Vida Roble	Carlsbad, CA		481		365		59			483		422		905		74		2006		(l	)
2365 Camino Vida Roble	Carlsbad, CA		1,098		630		(16	)		1,102		610		1,712		93		2006		(l	)
2375 Camino Vida Roble	Carlsbad, CA		1,210		874		154			1,214		1,024		2,238		160		2006		(l	)
6451 El Camino Real	Carlsbad, CA		2,885		1,931		254			2,895		2,175		5,070		274		2006		(l	)
Southern New Jersey
8 Springdale Road	Cherry Hill, NJ		258		1,436		834			258		2,270		2,528		639		1998		(l	)
111 Whittendale Drive	Morrestown, NJ		522		2,916		136			522		3,052		3,574		725		2000		(l	)
9 Whittendale	Morrestown, NJ		337		1,911		108			343		2,013		2,356		395		2001		(l	)
7851 Airport	Pennsauken, NJ		160		508		383			163		888		1,051		263		2003		(l	)
103 Central	Mt. Laurel, NJ		610		1,847		1,215			619		3,053		3,672		725		2003		(l	)
7890 Airport Hwy/7015 Central	Pennsauken, NJ		300		989		735			425		1,599		2,024		614		2006		(l	)
999 Grand Avenue	Hammonton, NJ	(y)	969		8,793		1,561			979		10,344		11,323		2,150		2005		(l	)
600 Creek Road	Delanco, NJ		2,125		6,504		(12	)		2,127		6,490		8,617		830		2007		(l	)
1070 Thomas Busch Memorial Hwy	Pennsauken, NJ		1,054		2,278		185			1,084		2,433		3,517		353		2007		(l	)
1601 Schlumberger Drive	Moorestown, NJ		560		2,240		745			608		2,937		3,545		185		2007		(l	)
St. Louis
10431-10449 Midwest Industrial Blvd	Olivette, MO		237		1,360		427			237		1,787		2,024		616		1994		(l	)
10751 Midwest Industrial Boulevard	Olivette, MO		193		1,119		452			194		1,570		1,764		676		1994		(l	)
6951 N Hanley(d)	Hazelwood, MO		405		2,295		1,322			419		3,603		4,022		1,022		1996		(l	)
1037 Warson — Bldg A	St. Louis, MO		246		1,359		694			251		2,048		2,299		357		2002		(l	)

S-15

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08						Accumulated
	Location	(a)	Initial Cost			and Valuation					Building and				Depreciation		Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land		Improvements		Total		12/31/08		Constructed		Lives (Years)
	(Dollars in thousands)
1037 Warson — Bldg B	St. Louis, MO		380		2,103		1,895			388		3,990		4,378		640		2002		(l	)
1037 Warson — Bldg C	St. Louis, MO		303		1,680		1,211			310		2,884		3,194		506		2002		(l	)
1037 Warson — Bldg D	St. Louis, MO		353		1,952		957			360		2,902		3,262		487		2002		(l	)
6821-6857 Hazelwood Ave	Berkeley, MO		985		6,205		913			985		7,118		8,103		1,297		2003		(l	)
13701 Rider Trail North	Earth City, MO		800		2,099		729			804		2,824		3,628		663		2003		(l	)
1908-2000 Innerbelt(d)	Overland, MO		1,590		9,026		981			1,591		10,006		11,597		2,242		2004		(l	)
9060 Latty Avenue	Berkeley, MO		687		1,947		138			694		2,078		2,772		771		2006		(l	)
21-25 Gateway Commerce Center	Edwardsville, IL	(z)	1,874		31,958		1,343			1,928		33,247		35,175		2,270		2006		(l	)
6647 Romiss Court	St. Louis, MO		230		681		72			241		742		983		48		2008		(l	)
Cenveno Building — 601 Cannonball	O’Fallon, MO		584		2,336		674			595		2,999		3,594		108		2007		(l	)
Pure Fishing BTS	Kansas City, MO		4,152		—		13,592			4,172		13,572		17,744		75		2008		(l	)
Tampa
5313 Johns Road	Tampa, FL		204		1,159		217			257		1,323		1,580		386		1997		(l	)
5525 Johns Road	Tampa, FL		192		1,086		341			200		1,419		1,619		405		1997		(l	)
5709 Johns Road	Tampa, FL		192		1,086		165			200		1,243		1,443		335		1997		(l	)
5711 Johns Road	Tampa, FL		243		1,376		175			255		1,539		1,794		427		1997		(l	)
5453 W Waters Avenue	Tampa, FL		71		402		135			82		526		608		147		1997		(l	)
5455 W Waters Avenue	Tampa, FL		307		1,742		417			326		2,140		2,466		599		1997		(l	)
5553 W Waters Avenue	Tampa, FL		307		1,742		476			326		2,199		2,525		593		1997		(l	)
5501 W Waters Avenue	Tampa, FL		215		871		399			242		1,243		1,485		321		1997		(l	)
5503 W Waters Avenue	Tampa, FL		98		402		162			110		552		662		136		1997		(l	)
5555 W Waters Avenue	Tampa, FL		213		1,206		185			221		1,383		1,604		376		1997		(l	)
5557 W Waters Avenue	Tampa, FL		59		335		35			62		367		429		101		1997		(l	)
5461 W Waters	Tampa, FL		261		—		1,434			265		1,430		1,695		366		1998		(l	)
5481 W. Waters Avenue	Tampa, FL		558		—		2,302			561		2,299		2,860		546		1999		(l	)
4515-4519 George Road	Tampa, FL		633		3,587		674			640		4,254		4,894		872		2001		(l	)
6089 Johns Road	Tampa, FL	(aa)	180		987		88			186		1,069		1,255		201		2004		(l	)
6091 Johns Road	Tampa, FL	(aa)	140		730		113			144		839		983		133		2004		(l	)
6103 Johns Road	Tampa, FL	(aa)	220		1,160		95			226		1,249		1,475		214		2004		(l	)
6201 Johns Road	Tampa, FL	(aa)	200		1,107		115			205		1,217		1,422		237		2004		(l	)
6203 Johns Road	Tampa, FL	(aa)	300		1,460		114			311		1,563		1,874		348		2004		(l	)
6205 Johns Road	Tampa, FL	(aa)	270		1,363		52			278		1,407		1,685		168		2004		(l	)
6101 Johns Road	Tampa, FL		210		833		195			216		1,022		1,238		221		2004		(l	)
4908 Tampa West Blvd	Tampa, FL		2,622		8,643		36			2,635		8,666		11,301		1,575		2005		(l	)
11701 Belcher Road South	Largo, FL		1,657		2,768		637			1,669		3,393		5,062		436		2006		(l	)
4900-4914 Creekside Drive(h)	Clearwater, FL		3,702		7,338		537			3,730		7,847		11,577		1,077		2006		(l	)
12345 Starkey Road	Largo, FL		898		2,078		410			905		2,481		3,386		295		2006		(l	)
Toronto
114 Packham Rd — Brooks Industries	Stratford, Ontario		1,000		3,526		(170	)		1,012		3,344		4,356		734		2007		(l	)
	Cambridge Ontario,
135 Dundas Street	Canada		3,128		4,958		138			3,179		5,045		8,224		1,917		2005		(l	)
	Stratford Ontario,
678 Erie Street	Canada		786		557		(236	)		829		278		1,107		201		2005		(l	)

S-16

						(c)
						Costs
						Capitalized
						Subsequent to
						Acquisition or			Gross Amount Carried
			(b)			Completion			At Close of Period 12/31/08								Accumulated
	Location	(a)	Initial Cost			and Valuation						Building and					Depreciation			Year Acquired/		Depreciable
Building Address	(City/State)	Encumbrances	Land	Buildings		Provision			Land			Improvements			Total		12/31/08			Constructed		Lives (Years)
	(Dollars in thousands)
777 Bayly Street West	Ajax Ontario, Canada		7,224		13,156		(585	)(ab)		7,039			12,756			19,795		1,541			2008		(l	)
Other
3501 Maple Street	Abilene, TX		67		1,057		1,473			266			2,331			2,597		1,178			1994		(l	)
4200 West Harry Street(e)	Wichita, KS		193		2,224		1,777			532			3,662			4,194		2,285			1994		(l	)
5050 Kendrick Court	Grand Rapids, MI		1,721		11,433		7,571			1,721			19,004			20,725		6,546			1994		(l	)
5015 52nd Street SE	Grand Rapids, MI		234		1,321		97			234			1,418			1,652		538			1994		(l	)
Lake Point IV	Orlando, FL		909		4,613		208			920			4,810			5,730		695			2005		(l	)
6266 Hurt Road	Horn Lake, MS		427		—		3,756			427			3,756			4,183		584			2004		(l	)
6266 Hurt Road Building B	Horn Lake, MS		—		—		868			99			769			868		136			2004		(l	)
12626 Silicon Drive	San Antonio, TX		768		3,448		22			779			3,459			4,238		611			2005		(l	)
3100 Pinson Valley Parkway	Birmingham, AL		303		742		21			310			756			1,066		123			2005		(l	)
1021 W. First Street, Hwy 93	Sumner, IA		99		2,540		20			100			2,559			2,659		528			2005		(l	)
1245 N. Hearne Avenue	Shreveport, LA		99		1,263		33			102			1,293			1,395		248			2005		(l	)
10330 I Street	Omaha, NE		1,808		8,340		15			1,809			8,354			10,163		1,783			2006		(l	)
Redevelopments /Developments / Developable Land(j)			149,502		270		37,107	(ab)		147,583			39,296			186,879		719
Total			$680,544	$	1,714,090	$	584,846		$	691,882	(k)	$	2,287,597	(k)	$	2,979,479	$	457,059	(k)

S-17

NOTES:

(a)	See description of encumbrances in Note 7 to Notes to Consolidated Financial Statements.
(b)	Initial cost for each respective property is tangible purchase price allocated in accordance with SFAS 141.
(c)	Improvements are net of write-off of fully depreciated assets.
(d)	Comprised of two properties.
(e)	Comprised of three properties.
(f)	Comprised of four properties.
(g)	Comprised of five properties.
(h)	Comprised of eight properties.
(i)	Comprised of 28 properties.
(j)	These properties represent developable land and redevelopments that have not been placed in service.
(k)

							Gross Amount
	Amounts						Carried At
	Included			Amounts Within			Close of Period
	in Real Estate			Net Investment			December 31,
	Held for Sale			in Real Estate*			2008*
Land	$	7,170		$	684,712		$	691,882
Buildings & Improvements		13,556			2,274,041			2,287,597
Accumulated Depreciation		(1,757	)		(455,302	)		(457,059	)
Subtotal		18,969			2,503,451			2,522,420
Construction in Progress		406			55,777			56,183
Net Investment in Real Estate		19,375			2,559,228			2,578,603
Leasing Commissions, Net, Deferred Leasing Intangibles, Net and Deferred Rent Receivable, Net		1,742
Balance Sheet at December 31, 2008	$	21,117

*	Amounts exclude $79,483 of above market leases and other deferred leasing intangibles, net.
(l)	Depreciation is computed based upon the following estimated lives:

Buildings and Improvements	8 to 50 years
Tenant Improvements, Leasehold Improvements	Life of lease

(m)	This property collateralizes a $2.5 million mortgage loan which matures on May 1, 2016.
(n)	This property collateralizes a $14.1 million mortgage loan which matures on December 1, 2010.
(o)	This property collateralizes a $4.9 million mortgage loan which matures on December 1, 2019.
(p)	This property collateralizes a $1.2 million mortgage loan which matures on January 1, 2013.
(q)	These properties collateralize a $0.5 million mortgage loan which matures on September 1, 2009.
(r)	This property collateralizes a $2.3 million mortgage loan which matures on January 1, 2012.
(s)	This property collateralizes a $1.5 million mortgage loan which matures on June 1, 2014.
(t)	This property collateralizes a $2.4 million mortgage loan which matures on July 1, 2018.
(u)	This property collateralizes a $1.0 million mortgage loan which matures on July 1, 2018.
(v)	This property collateralizes a $4.8 million mortgage loan which matures on December 1, 2019.
(w)	This property collateralizes a $1.7 million mortgage loan which matures on September 30, 2024.
(x)	This property collateralizes a $4.3 million mortgage loan which matures on June 1, 2018.
(y)	This property collateralizes a $6.0 million mortgage loan which matures on March 1, 2011.
(z)	This property collateralizes a $13.5 million mortgage loan and a $11.5 million mortgage loan which both mature on January 1, 2014.

(aa)	These properties collateralize a $5.2 million mortgage loan which matures on July 1, 2009.
(ab)	Includes foreign currency translation adjustments.

S-18

At December 31, 2008, the aggregate cost of land and buildings and equipment for federal income tax purpose was approximately $2.8 billion (excluding construction in progress.)

The changes in total real estate assets, including real estate held for sale, for the three years ended December 31, 2008 are as follows:

	2008			2007			2006
	(Dollars in thousands)
Balance, Beginning of Year	$	2,952,499		$	2,938,242		$	2,914,916
Acquisition of Real Estate Assets		279,542			405,633			511,479
Construction Costs and Improvements		176,506			220,571			199,550
Disposition of Real Estate Assets		(340,802	)		(590,271	)		(672,099	)
Write-off of Fully Depreciated Assets		(32,083	)		(21,676	)		(15,604	)
Balance, End of Year	$	3,035,662		$	2,952,499		$	2,938,242

The changes in accumulated depreciation, including accumulated depreciation for real estate held for sale, for the three years ended December 31, 2008 are as follows:

	2008			2007			2006
Balance, Beginning of Year	$	439,312		$	410,962		$	357,228
Depreciation for Year		101,541			105,758			107,352
Disposition of Assets		(51,711	)		(55,732	)		(38,014	)
Write-off of Fully Depreciated Assets		(32,083	)		(21,676	)		(15,604	)
Balance, End of Year	$	457,059		$	439,312		$	410,962

S-19

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.

FIRST INDUSTRIAL, L.P.

By:  FIRST INDUSTRIAL REALTY TRUST, INC.
as general partner

By:  /s/  Bruce W. Duncan

Bruce W. Duncan

President, Chief Executive Officer and Director

(Principal Executive Officer)

Date: March 2, 2009

By:  /s/  Scott A. Musil

Scott A. Musil

Chief Financial and Accounting Officer

(Principal Financial and Accounting Officer)

Date: March 2, 2009

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/  W. Edwin Tyler W. Edwin Tyler	Chairman of the Board of Directors	March 2, 2009
/s/  Bruce W. Duncan Bruce W. Duncan	President, Chief Executive Officer and Director	March 2, 2009
John Brenninkmeijer	Director	March 2, 2009
/s/  Michael G. Damone Michael G. Damone	Director of Strategic Planning and Director	March 2, 2009
Kevin W. Lynch	Director	March 2, 2009
/s/  John E. Rau John E. Rau	Director	March 2, 2009
/s/  Jay H. Shidler Jay H. Shidler	Director	March 2, 2009

S-20

Signature	Title	Date
/s/  Robert J. Slater Robert J. Slater	Director	March 2, 2009
/s/  J. Steven Wilson J. Steven Wilson	Director	March 2, 2009

S-21