UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
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| þ | | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2006
OR
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| o | | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
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Commission file numbers: | | 1-13130 (Liberty Property Trust) |
| | | 1-13132 (Liberty Property Limited Partnership) |
LIBERTY PROPERTY TRUST
LIBERTY PROPERTY LIMITED PARTNERSHIP
(Exact Names of Registrants as Specified in Their Governing Documents)
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MARYLAND(Liberty Property Trust) | | 23-7768996 |
PENNSYLVANIA(Liberty Property Limited Partnership) | | 23-2766549 |
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| (State or Other Jurisdiction | | (I.R.S. Employer |
| of Incorporation or Organization) | | Identification Number) |
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500 Chesterfield Parkway Malvern, Pennsylvania | | 19355 |
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| (Address of Principal Executive Offices) | | (Zip Code) |
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| Registrants’ Telephone Number, including Area Code | | (610) 648-1700 |
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| Securities registered pursuant to Section 12(b) of the Act: | | | | |
| | | NAME OF EACH EXCHANGE |
TITLE OF EACH CLASS | | ON WHICH REGISTERED |
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| Common Shares of Beneficial Interest, | | | | |
| $0.001 par value | | | | |
| (Liberty Property Trust) | | New York Stock Exchange |
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| Preferred Share Purchase Rights, | | | | |
| $0.0001 par value | | | | |
| (Liberty Property Trust) | | New York Stock Exchange |
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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.
YESþ NOo
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.
YESo NOþ
Indicate by check mark whether the Registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrants were required to file such reports) and (2) have been subject to such filing requirements for the past ninety (90) days.
YESþ NOo
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K is not contained herein, and will not be contained, to the best of the Registrants’ knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.o
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer. (See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act). (Check one):
LARGE ACCELERATED FILERþ ACCELERATED FILERo NON-ACCELERATED FILERo
Indicate by check mark if the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
YESo NOþ
The aggregate market value of the Common Shares of Beneficial Interest, $0.001 par value (the “Common Shares”), of Liberty Property Trust held by non-affiliates of Liberty Property Trust was $4.0 billion, based upon the closing price of $44.20 on the New York Stock Exchange composite tape on June 30, 2006. Non-affiliate ownership is calculated by excluding all Common Shares that may be deemed to be beneficially owned by executive officers and trustees, without conceding that any such person is an “affiliate” for purposes of the federal securities laws.
Number of Common Shares outstanding as of February 23, 2007: 91,402,800
Documents Incorporated by Reference
Portions of the proxy statement for the annual meeting of shareholders of Liberty Property Trust to be held in 2007 are incorporated by reference into Part III of this Form 10-K.
The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Certain information included in this Annual Report on Form 10-K and other materials filed or to be filed by the Company (as defined herein) with the Securities and Exchange Commission (“SEC”) (as well as information included in oral statements or other written statements made or to be made by the Company) contain statements that are or will be forward-looking, such as statements relating to rental operations, business and property development activities, joint venture relationships, acquisitions (including related pro forma financial information), dispositions, future capital expenditures, financing sources and availability, and the effects of regulation (including environmental regulation) and competition. These forward-looking statements generally are accompanied by words such as “believes,” “anticipates,” “hopes,” “expects,” “estimates,” “should,” “seeks,” “intends,” “planned,” “outlook” and “goal” or similar expressions. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be achieved. As forward-looking statements, these statements involve important risks, uncertainties and other factors that could cause actual results to differ materially from the expected results and, accordingly, such results may differ from those expressed in any forward-looking statements made by, or on behalf of the Company. The Company assumes no obligation to update or supplement forward looking statements that become untrue because of subsequent events. These risks, uncertainties and other factors include, without limitation, uncertainties affecting real estate businesses generally (such as entry into new leases, renewals of leases and dependence on tenants’ business operations), risks relating to our ability to maintain and increase property occupancy and rental rates, risks relating to construction and development activities, risks relating to acquisition and disposition activities, risks relating to joint venture relationships and any possible need to perform under certain guarantees that we have issued or may issue in connection with such relationships, possible environmental liabilities, risks relating to leverage and debt service (including availability of financing terms acceptable to the Company and sensitivity of the Company’s operations and financing arrangements to fluctuations in interest rates), dependence on the primary markets in which the Company’s properties are located, the existence of complex regulations relating to status as a REIT and the adverse consequences of the failure to qualify as a REIT, and the potential adverse impact of market interest rates on the market price for the Company’s securities. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Forward-Looking Statements.”
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PART I
ITEM 1. BUSINESS
The Company
Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (a “REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the “Operating Partnership” and, together with the Trust and their consolidated subsidiaries, the “Company”).
The Company completed its initial public offering in 1994 to continue and expand the commercial real estate business of Rouse & Associates, a Pennsylvania general partnership, and certain affiliated entities (collectively, the “Predecessor”) which was founded in 1972. As of December 31, 2006, the Company’s portfolio consisted of 720 industrial and office properties (the “Properties in Operation”) totaling 65.3 million square feet. In addition, at that date, the Company had 38 properties under development, which when completed are expected to add 7.4 million square feet to the Company’s portfolio (the “Properties Under Development” and, together with the Properties in Operation, the “Properties”), and owned 1,607 acres of land, substantially all of which was zoned for commercial use. Included in the above totals are 48 Properties in Operation comprising 6.2 million square feet, five Properties Under Development expected to add 1.1 million square feet and 283 acres of developable land owned by unconsolidated joint ventures in which the Company has an interest.
The Company provides leasing, property management, development, acquisition and other tenant-related services for the Properties in Operation. The Company’s industrial Properties consist of a variety of warehouse, distribution, service, assembly, light manufacturing and research and development facilities. They include both single-tenant and multi-tenant facilities, with most designed flexibly to accommodate various types of tenants, space requirements and industrial uses. The Company’s office Properties are multi-story and single-story office buildings located principally in suburban mixed-use developments or office parks. Substantially all of the Company’s Properties are located in prime business locations within established business communities. In addition, the Company is developing a 1.25 million square foot office tower, known as the Comcast Center, in Philadelphia’s central business district.
The Trust is the sole general partner and also a limited partner of the Operating Partnership, owning 95.6% of the common equity of the Operating Partnership at December 31, 2006. The common units of limited partnership interest in the Operating Partnership (the “Common Units”), other than those owned by the Trust, are exchangeable on a one-for-one basis (subject to anti-dilution protections) for the Trust’s Common Shares of Beneficial Interest, $0.001 par value per share (the “Common Shares”). The Common Units held by the limited partners were exchangeable for 4.2 million Common Shares on December 31, 2006. The Company has issued Cumulative Redeemable Preferred Units of the Operating Partnership (the “Preferred Units”). The outstanding Preferred Units are exchangeable on a one-for-one basis after stated dates into Cumulative Redeemable Preferred Shares of the Trust. Collectively, the ownership of the holders of Common and Preferred Units is reflected on the Trust’s financial statements as minority interest.
In addition to this Annual Report on Form 10-K, the Company files periodic and current reports, proxy statements and other information with the SEC. The Company makes these documents available on its website, www.libertyproperty.com, free of charge, as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. You may also read and copy any document the Company files with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Room 1580, Washington, DC 20549. Please call the SEC at (800) SEC-0330 for further information about the public reference facilities. These documents also may be accessed through the SEC’s electronic data gathering, analysis and retrieval system (“EDGAR”) via electronic means, including the SEC’s home page on the Internet, www.sec.gov.
Also posted on the Company’s website is the Company’s Code of Conduct, which applies to all of its employees and also serves as a code of ethics for its chief executive officer, chief financial officer and persons performing similar functions. The Company will send the Code of Conduct, free of charge, to anyone who requests a copy in writing from its Investor Relations Department at the address set forth on the cover of this filing. The Company intends to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding any amendments to or waivers of the Code of Conduct by posting the required information in the Corporate Governance area of its website.
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Management and Employees
The Company’s 474 employees (as of February 23, 2007) operate under the direction of 19 senior executives, who, on average, have been affiliated with the Company and the Predecessor for 15 years. The Company and the Predecessor have developed and managed commercial real estate for the past 34 years. The Company’s in-house leasing and property management staff operate in markets where it has a significant presence. This structure enables the Company to better understand the characteristics of the local markets in which it operates, to respond quickly and directly to tenant needs and to better identify local real estate opportunities. At December 31, 2006, the Company’s reportable segments were based on the Company’s method of internal reporting and are as follows:
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| Reportable Segments | | Markets |
| Delaware Valley | | Southeastern Pennsylvania; New Jersey |
| Midwest | | Lehigh Valley, Pennsylvania; Michigan; Minnesota; Milwaukee; Chicago |
| Mid-Atlantic | | Maryland; Piedmont Triad, NC; Greenville, SC; Richmond; Virginia Beach |
| Florida | | Jacksonville; Orlando; Boca Raton; Tampa; Texas |
| United Kingdom | | County of Kent |
Business Objective and Strategies for Growth
The Company’s business objective is to maximize long-term profitability for its shareholders by being a recognized leader in commercial real estate through the ownership, management, development and acquisition of superior office and industrial properties. The Company intends to achieve this objective through offering office and industrial properties in multiple markets and operating as a leading landlord in the industry. The Company believes that this objective will provide the benefits of enhanced investment opportunities, economies of scale, risk diversification both in terms of geographic market and real estate product type, access to capital, and the ability to attract and retain personnel. The Company also strives to be a leading provider of customer service, providing an exceptional and positive customer experience. In pursuing its business objective, the Company seeks to achieve a combination of internal and external growth, maintain a conservative balance sheet and pursue a strategy of financial flexibility.
Products
The Company strives to be a recognized quality provider of five products (industrial properties, including big box warehouse, multi-tenant industrial, and flex/R&D; and office properties, including single-story office and multi-story office). When the Company’s marketing efforts identify opportunities, the Company will, on occasion, pursue other office and industrial product types including high rise office towers.
Markets
The Company operates primarily in the Mid-Atlantic, Southeastern and Midwestern United States. Additionally, the Company owns certain assets in the United Kingdom. The Company recently announced its intention to enter the Phoenix, Arizona market and exit the Michigan market. The Company’s goal is to operate in each of its markets with an appropriate product mix of office and industrial properties. Generally, the Company seeks to have a presence that allows it to be viewed as a significant participant in each market. The Company’s efforts emphasize business park development and asset aggregation. The Company gathers information from internal sources and independent third parties and analyzes this information to support its evaluation of markets and market conditions.
Organizational Plan
The Company seeks to maintain a management organization that facilitates efficient execution of the Company’s strategy. As part of this effort, the Company pursues a human resources plan designed to create and maintain a highly regarded real estate company through recruiting, training and retaining capable people. The structure is designed to support a local office entrepreneurial platform operating within a value-added corporate structure. The Company upgrades its information technology periodically to keep pace with advances in available technology.
Internal Growth Strategies
The Company seeks to maximize the profitability of its Properties by endeavoring to maintain high occupancy levels while obtaining competitive rental rates, controlling costs and focusing on customer service efforts.
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Maintain High Occupancies
The Company believes that the quality and diversity of its tenant base and its strategy of operating in multiple markets is integral to achieving its goal of attaining high occupancy levels for its portfolio. The Company targets financially stable tenants in an effort to minimize uncertainty relating to the ability of the tenants to meet their lease obligations.
Cost Controls
The Company seeks to identify best practices to apply throughout the Company in order to enhance cost savings and other efficiencies. The Company also employs an annual capital improvement and preventative maintenance program designed to reduce the operating costs of the Properties and maintain the long-term value of the Properties.
Customer Service
The Company seeks to achieve high tenant retention through a comprehensive customer service program, which is designed to provide an exceptional and positive customer experience. The customer service program establishes best practices and provides an appropriate customer feedback process. The Company believes that the program has been helpful in increasing customer satisfaction.
Energy Efficient Initiatives
The Company is committed to improving the energy efficiency of the existing buildings in its portfolio and has made a substantial effort to design environmentally friendly features in the buildings it develops.
The Company has been an active participant in the U.S. Green Building Council’s Leadership in Energy and Environmental Design (“LEED”) program. The LEED program, which was created to recognize environmental leadership in the building industry, establishes a voluntary, consensus-based national standard for developing high-performance, sustainable buildings. The Company currently has over three million square feet of LEED projects completed or under construction. In 2006, the Company earned the U.S. Green Building Council LEED Award for Corporate Leadership.
The Company believes that building in accordance with LEED standards is environmentally responsible and can lead to significant operating efficiencies. The Company belives that green building techniques such as construction waste management (recycling waste onsite); energy conservation (occupancy sensors associated with lighting and high performance HVAC systems); and improvement of environmental quality (maximization of daylight and use of low-emitting materials) can result in positive environmental results and significant economic returns to tenants in terms of savings in operating costs and improved employee performance.
The Company has also taken significant steps to improve the energy efficiency of the existing buildings in the portfolio. These efforts have included, in various cases: (1) performing lighting retrofits to upgrade older fluorescent bulbs with magnetic ballasts with newer bulbs utilizing electronic ballasts; (2) installing and upgrading building automation systems to provide a greater level of control in order to reduce energy consumed; (3) installing white roof systems designed to lower thermal heat gains associated with traditional black roof surfaces; (4) installing “economizer” fresh air units that allow cooling from outside fresh air on cooler days; (5) implementing common area and parking lot lighting controls designed to increase energy efficiency; and (6) establishing a green property management guide and green training program for its property management staff.
External Growth Strategies
The Company seeks to enhance its long-term profitability through the development, acquisition and disposition of properties either directly or through joint ventures.
Development
The Company pursues attractive development opportunities, focusing primarily on high-quality suburban industrial and office properties within its existing markets. When the Company’s marketing efforts identify opportunities, the Company will consider pursuing urban opportunities and development opportunities outside of the Company’s established markets. The Company and its Predecessor have developed over 50 million square feet of commercial real estate during the past 34 years. The Company’s development activities generally fall into two categories: build-to-suit projects and projects built for inventory (projects that are less than 75% leased prior to commencement of construction). The Company develops build-to-suit projects for existing and new tenants. The Company also builds properties for inventory where the Company has identified sufficient demand at market rental rates to justify such construction.
During the year ended December 31, 2006, the Company completed five build-to-suit projects and 16 inventory projects totaling 2.3 million square feet and representing an aggregate Total Investment, as defined below, of $211.8
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million. As of December 31, 2006, these completed development properties were 96.2% leased. The “Total Investment” for a Property is defined as the Property’s purchase price plus closing costs and management’s estimate, as determined at the time of acquisition, of the cost of necessary building improvements in the case of acquisitions, or land costs and land and building improvement costs in the case of development projects, and, where appropriate, other development costs and carrying costs.
As of December 31, 2006 the Company had 32 wholly owned Properties Under Development, excluding Comcast Center, which are expected to comprise, upon completion, 5.0 million square feet and are expected to represent a Total Investment of $456.3 million. These Properties Under Development were 50.3% pre-leased as of December 31, 2006. The scheduled deliveries of the 5.0 million square feet in Properties Under Development are as follows (in thousands, except percentages):
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| | | Square Feet | | | Percent Leased | | | Total | |
| Scheduled In-Service Date | | Ind-Dist. | | | Ind-Flex | | | Office | | | Total | | | December 31, 2006 | | | Investment | |
1st Quarter 2007 | | | — | | | | 79 | | | | 134 | | | | 213 | | | | 78.4 | % | | $ | 25,281 | |
2nd Quarter 2007 | | | 1,063 | | | | 34 | | | | 160 | | | | 1,257 | | | | 88.7 | % | | | 98,417 | |
3rd Quarter 2007 | | | 552 | | | | 139 | | | | 230 | | | | 921 | | | | 79.8 | % | | | 89,022 | |
4th Quarter 2007 | | | 968 | | | | — | | | | 450 | | | | 1,418 | | | | 31.7 | % | | | 124,804 | |
1st Quarter 2008 | | | – | | | | 83 | | | | 74 | | | | 157 | | | | — | | | | 19,924 | |
2nd Quarter 2008 | | | 461 | | | | 208 | | | | — | | | | 669 | | | | 7.5 | % | | | 44,660 | |
3rd Quarter 2008 | | | — | | | | 116 | | | | 251 | | | | 367 | | | | — | | | | 54,183 | |
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| Total | | | 3,044 | | | | 659 | | | | 1,299 | | | | 5,002 | | | | 50.3 | % | | $ | 456,291 | |
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In addition to the above Properties Under Development, the Company is constructing the Comcast Center, a 1.25 million square foot office tower in Philadelphia’s central business district. In February 2007, Comcast Corporation signed an amendment to its lease for an additional 152,000 square feet. Comcast’s lease is now for 1,095,000 square feet and is for 151/2 years. The Comcast Center is designed to achieve LEED Certification. Costs associated with incremental leasing and certain other costs have increased the projected Total Investment of this building to $495 million.
In addition, unconsolidated joint ventures in which the Company has an interest had five Properties Under Development at December 31, 2006 which are expected to comprise, upon completion, 1.1 million leaseable square feet and are expected to represent a Total Investment of $85.1 million.
The Company believes that, because it is a fully integrated real estate firm, its base of commercially zoned land in existing industrial and office business parks provides a competitive advantage for future development activities. As of December 31, 2006, the Company owned 1,324 acres of land held for development and unconsolidated joint ventures in which the Company has an interest owned 283 acres of land held for development, substantially all of which is zoned for commercial use. Substantially all of the land is located adjacent to or within existing industrial or business parks with site improvements, such as public sewers, water and utilities, available for service. The Company anticipates that its land holdings would support, as and when developed, 16.3 million square feet of property. The Company’s investment in land held for development as of December 31, 2006 was $195.3 million.
Acquisitions/Dispositions
The Company seeks to acquire properties consistent with its business objectives and strategies. The Company executes its acquisition strategy by purchasing properties that management believes will create shareholder value over the long-term.
During the year ended December 31, 2006, the Company acquired 23 properties comprising 2.5 million square feet for a Total Investment of $306.5 million. In addition, a joint venture in which the Company has a 25% interest acquired one property comprising 409,000 square feet for $13.8 million.
The Company disposes of properties and land held for development which no longer fit within the Company’s strategic plan, or with respect to which the Company believes it can optimize cash proceeds. During the year ended December 31, 2006, the Company sold 40 operating properties, which contained 4.0 million square feet of leaseable space, and five acres of land, for an aggregate of $398.2 million. The Company also sold six operating properties which contained 2.1 million square feet and 104 acres of land in Chicago to an unconsolidated joint venture in which the Company retained a 25% interest for $125.0 million. In addition, unconsolidated joint ventures in which the Company has an interest sold two properties which contained 143,000 square feet of leaseable space and six acres of land for $9.9 million. See Joint Ventures below.
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Joint Ventures
The Company, from time to time, considers joint venture opportunities with institutional investors or other real estate companies. Joint venture partnerships provide the Company with additional sources of capital to share investment risk and fund capital requirements. In some instances, joint venture partnerships provide the Company with additional local market or product type expertise.
In April 2006, the Company entered into a joint venture with an affiliate of Commerzleasing und Immobilien AG, a wholly-owned subsidiary of Commerzbank AG, whereby the Company sold an 80% interest in the equity of Comcast Center. The transaction valued the property at $512 million. The joint venture obtained a $324 million forward loan commitment from Citigroup Global Markets Realty Corp, at a rate of 6.15% assuming the loan will close in March 2008. The Company is the managing general partner of the joint venture. In addition to retaining a 20% interest in the joint venture, the Company will earn leasing and property management fees, as well as a possible promoted interest if certain return thresholds are met. The development of Comcast Center is on schedule for a phased occupancy beginning in late 2007. Including the lease with the Comcast Corporation and leases with other tenants, there are signed leases for 91.2% of the Comcast Center’s leaseable space. Under the terms of the joint venture agreement, the Company is obligated to complete development of the building, the cost of which is approximately $495 million, and also complete the initial leasing of the property. The criteria for sale recognition in accordance with SFAS No. 66 “Accounting for the Sale of Real Estate,” have not been met and this transaction is being accounted for as a financing arrangement.
In April 2006, the Company entered into a joint venture with the New York State Common Retirement Fund. The Company sold six distribution buildings totaling 2.1 million square feet and 104 acres of developable land, valued at an aggregate of $125.0 million, to the joint venture. The Company retained a 25% ownership position in the joint venture, and will receive development, leasing and property management fees, and may receive a promoted interest if certain return thresholds are met. The venture is financed with approximately 60% leverage. The joint venture will seek to grow its portfolio through acquisition, development and redevelopment of under-utilized distribution properties. It is expected that the joint venture will grow to hold approximately $500 million in assets.
As of December 31, 2006, the Company had investments in unconsolidated joint ventures totaling $47.2 million.
United Kingdom Operations
The Company maintains a presence in certain markets in the United Kingdom. Its principal operations are located in the County of Kent, England. The Company has an agreement with the Kent County Council for the development of an 800 acre mixed commercial and residential community in the County of Kent. The community known as “Kings Hill” is located approximately 25 miles southeast of London. The community has been developed over the past decade pursuant to the development agreement between the Kent County Council and the Company. The development agreement with the Kent County Council requires the Company to construct land infrastructure and allows the Company to develop commercial space and entitles it to receive certain proceeds from the sale of land parcels.
In December 2005, the Company partnered with Doughty Hanson & Co. Real Estate on a $219.9 million joint venture comprising the majority of the Company’s office and flex portfolio in the first phase at Kings Hill. The Company sold 15 Properties in Operation totaling 535,000 square feet to this joint venture. The joint venture was financed with $163.4 million of secured debt and the Company retained a 20% interest in the joint venture. The Company earns fees for managing the assets and may receive a promoted interest if certain return thresholds are met.
The Company has received planning consent for a second phase which provides for the development of an additional one million square feet of commercial space and for 750 residential units. The Doughty Hanson joint venture does not own an interest in the second phase.
The Company has also invested in two additional joint ventures to develop projects in separate locations in England. The Company believes that its development expertise, its access to capital and its relationship with tenants engaged in international business will create opportunities to service the needs of these tenants in both the United States and the United Kingdom.
The Company continues to attempt to identify other development and acquisition opportunities in the United Kingdom.
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ITEM 1A. RISK FACTORS
The Company’s results of operations and the ability to make distributions to our shareholders and pay debt service on our indebtedness may be affected by the risk factors set forth below. (The Company refers to itself as “we”, “us” or “our” in the following risk factors.) This section contains some forward looking statements. You should refer to the explanation of the qualifications and limitations on forward looking statements on page 3.
Risks Related to Our Business
Unfavorable events affecting our existing tenants, or negative market conditions that may affect our existing tenants, could have an adverse impact on our ability to attract new tenants, relet space, collect rent or renew leases, and thus could have a negative effect on our cash flow from operations and inhibit growth.
Our cash flow from operations depends on our ability to lease space to tenants on economically favorable terms. Therefore, we could be adversely affected by various facts and events over which we have limited control, such as:
| | • | | lack of demand for space in the areas where our Properties are located |
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| | • | | inability to retain existing tenants and attract new tenants |
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| | • | | oversupply of or reduced demand for space and changes in market rental rates |
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| | • | | defaults by our tenants or their failure to pay rent on a timely basis |
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| | • | | the need to periodically renovate and repair our space |
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| | • | | physical damage to our Properties |
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| | • | | economic or physical decline of the areas where our Properties are located |
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| | • | | potential risk of functional obsolescence of our Properties over time |
At any time, any of our tenants may experience a downturn in its business that may weaken its financial condition. As a result, a tenant may delay lease commencement, fail to make rental payments when due, decline to extend a lease upon its expiration, become insolvent or declare bankruptcy. Any tenant bankruptcy or insolvency, leasing delay or failure to make rental payments when due could result in the termination of the tenant’s lease and material losses to our Company.
If our tenants do not renew their leases as they expire, we may not be able to rent the space. Furthermore, leases that are renewed, and some new leases for space that is relet, may have terms that are less economically favorable to us than current lease terms, or may require us to incur significant costs, such as for renovations, tenant improvements or lease transaction costs.
Any of these events could adversely affect our cash flow from operations and our ability to make expected distributions to our shareholders and service our indebtedness.
A significant portion of our costs, such as real estate taxes, insurance costs, and debt service payments, generally are not reduced when circumstances cause a decrease in cash flow from our Properties.
We may not be able to compete successfully with other entities that operate in our industry.
We experience a great deal of competition in attracting tenants for our Properties and in locating land to develop and properties to acquire.
In our effort to lease our Properties, we compete for tenants with a broad spectrum of other landlords in each of our markets. These competitors include, among others, publicly-held REITs, privately-held entities, individual property owners and tenants who wish to sublease their space. Some of these competitors may be able to offer prospective tenants more attractive financial or other terms than we are able to offer.
We may experience increased operating costs, which could adversely affect our operations.
Our Properties are subject to increases in operating expenses such as insurance, cleaning, electricity, heating, ventilation and air conditioning, general and administrative costs and other costs associated with security, landscaping, repairs and maintenance. While our current tenants generally are obligated to pay a significant portion of these costs, there is no assurance that these tenants will make such payments or agree to pay these costs upon renewal or that new tenants will agree to pay these costs. If operating expenses increase in our markets, we may not be able to increase rents or reimbursements in all of these markets so as to meet increased expenses without at the same time decreasing occupancy rates. If this occurs, our ability to make distributions to shareholders and service our indebtedness could be adversely affected.
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Our ability to achieve growth in operating income depends in part on our ability to develop properties which may suffer under certain circumstances.
We intend to continue to develop properties where warranted by market conditions. We have a number of ongoing development projects and a number of land projects being readied for development. These projects include the Comcast Center, a 1.25 million square foot office tower in Philadelphia’s central business district, which is discussed below.
Additionally, our general construction and development activities include the risks that:
| | • | | construction and leasing of a property may not be completed on schedule, which could result in increased expenses and construction costs, and would result in reduced profitability for that property |
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| | • | | construction costs may exceed our original estimates due to increases in interest rates and increased materials, labor or other costs, possibly making the property unprofitable because we may not be able to increase rents to compensate for the increase in construction costs |
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| | • | | some developments may fail to achieve expectations, possibly making them unprofitable |
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| | • | | we may be unable to obtain, or may face delays in obtaining, required zoning, land-use, building, occupancy, and other governmental permits and authorizations, which could result in increased costs and could require us to abandon our activities entirely with respect to a project |
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| | • | | we may abandon development opportunities after we begin to explore them and as a result, we may fail to recover costs already incurred. If we alter or discontinue our development efforts, past and future costs of the investment may need to be expensed rather than capitalized and we may determine the investment is impaired, resulting in a loss |
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| | • | | we may expend funds on and devote management’s time to projects that we do not complete |
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| | • | | occupancy rates and rents at newly completed properties may fluctuate depending on a number of factors, including market and economic conditions, and may result in lower than projected rental rates with the result that our investment is not profitable |
Our Comcast Center project is subject to a number of risks related to its development, construction and leasing.
We commenced construction of the 1.25 million square foot Comcast Center, located in downtown Philadelphia, in January 2005. The office tower is expected to be ready for initial occupancy to commence on the lower floors in the fall of 2007. Comcast Corporation has signed a 151/2 year lease for 1,095,000 square feet, or 87.4%, of the building’s leaseable space. Including the lease with Comcast Corporation and leases with other tenants, there are signed leases for 91.2% of the Comcast Center’s leaseable space. The total project cost to be incurred by us is expected to be $495 million.
In April 2006, the Company entered into a joint venture with an affiliate of Commerzleasing and Immobilien AG, a wholly-owned subsidiary of Commerzbank AG, whereby the Company sold an 80% interest in the equity of Comcast Center. Under the terms of the joint venture, the Company is obligated to complete development of the building and complete the initial leasing of the property.
Development of a project such as Comcast Center is subject to the general development and construction risks noted above. Those risks are magnified by the size of the project, and include construction risks associated with undertaking a construction project with the engineering and design complexities of an office tower. If we fail to achieve the completion deadlines set forth in the lease with Comcast, we will be responsible for damages incurred by Comcast Corporation.
The project is subject to leasing risk as to the portion of the building not leased.
We face risks associated with property acquisitions.
We acquire individual properties and portfolios of properties, and intend to continue to do so. Our acquisition activities and their success are subject to the following risks:
| | • | | when we are able to locate a desirable property, competition from other real estate investors may significantly increase the purchase price |
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| | • | | acquired properties may fail to perform as expected |
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| | • | | the actual costs of repositioning or redeveloping acquired properties may be higher than our estimates |
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| | • | | acquired properties may be located in new markets where we face risks associated with an incomplete knowledge or understanding of the local market, a limited number of established business relationships in the area and a relative unfamiliarity with local governmental and permitting procedures |
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| | • | | we may be unable to quickly and efficiently integrate new acquisitions, particularly acquisitions of portfolios of properties, into our existing operations, and as a result, our results of operations and financial condition could be adversely affected |
We may acquire properties subject to liabilities and without any recourse, or with only limited recourse, with respect to unknown liabilities. As a result, if a liability were asserted against us based upon ownership of those properties, we might have to pay substantial sums to settle it, which could adversely affect our cash flow.
Many of our Properties are concentrated in our primary markets, and we therefore may suffer economic harm as a result of adverse conditions in those markets.
Our Properties are located principally in specific geographic areas in the Mid-Atlantic, Southeastern and Midwestern United States and the United Kingdom. Due to the concentration of our Properties in these areas, performance is dependent on economic conditions in these areas. These areas have experienced periods of economic decline.
We may not be able to access financial markets to obtain capital on a timely basis, or on acceptable terms.
In order to qualify as a REIT for federal income tax purposes, we are required to distribute at least 90% of our taxable income to shareholders each year, and thus cannot reinvest this portion of income in the business. As a result, retained cash flows are somewhat limited and we rely on proceeds from property dispositions and third party capital sources for a portion of our capital needs, including capital for acquisitions and development. The public debt and equity markets are among the sources we rely on. There is no guarantee that we will be able to access these markets, or any other source of capital, on attractive terms or at all. The ability to access the public debt and equity markets depends on a variety of factors, including:
| | • | | general economic conditions affecting these markets |
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| | • | | our own financial structure and performance |
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| | • | | the market’s opinion of REITs in general |
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| | • | | the market’s opinion of REITs that own properties like ours |
We may suffer adverse effects as a result of the terms of and covenants relating to our indebtedness.
Required payments on our indebtedness generally are not reduced if the economic performance of the portfolio declines. If the economic performance declines, net income, cash flow from operations and cash available for distribution to shareholders will be reduced. If payments on debt cannot be made, we could sustain a loss, or in the case of mortgages, suffer foreclosures by mortgagees or suffer judgments. Further, some obligations, including our $600 million credit facility and $2.0 billion in unsecured notes issued in past public offerings, contain cross-default and/or cross-acceleration provisions, as does $44.2 million in outstanding mortgage indebtedness at December 31, 2006, which means that a default on one obligation may constitute a default on other obligations.
We anticipate that only a small portion of the principal of our debt will be repaid prior to maturity. Therefore, we generally need to refinance our outstanding debt as it matures. There is a risk that we may not be able to refinance existing debt or that the terms of any refinancing will not be as favorable as the terms of our existing debt. If principal payments due at maturity cannot be refinanced, extended or repaid with proceeds from other sources, such as the proceeds of sales of assets or new equity securities, our cash flow will not be sufficient to repay all maturing debt in years when significant “balloon” payments come due.
Our credit facility and unsecured debt securities contain customary restrictions, requirements and other limitations on our ability to incur indebtedness, including total debt to asset ratios, secured debt to total asset ratios, debt service coverage ratios and minimum ratios of unencumbered assets to unsecured debt which we must maintain. Our continued ability to borrow under our $600 million credit facility is subject to compliance with our financial and other covenants. In addition, our failure to comply with such covenants could cause a default under this credit facility, and we may then be required to repay such debt with capital from other sources. Under those circumstances, other sources of capital may not be available to us, or be available only on unattractive terms.
Our degree of leverage could limit our ability to obtain additional financing or affect the market price of our common stock.
Our degree of leverage could affect our ability to obtain additional financing for working capital, capital expenditures, acquisitions, development or other general corporate purposes. Our senior unsecured debt is currently rated investment grade by the three major rating agencies. However, there can be no assurance we will be able to maintain this rating, and in the event our senior debt is downgraded from its current rating, we would likely incur higher borrowing costs. Our degree of leverage could also make us more vulnerable to a downturn in business or the economy generally.
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Further issuances of equity securities may be dilutive to current shareholders.
The interests of our existing shareholders could be diluted if we issue additional equity securities to finance future developments, acquisitions, or repay indebtedness. Our Board of Trustees can authorize the issuance of additional securities without shareholder approval. Our ability to execute our business strategy depends on our access to an appropriate blend of debt financing, including unsecured lines of credit and other forms of secured and unsecured debt, and equity financing, including issuances of common and preferred equity.
An increase in interest rates would increase our interest costs on variable rate debt and could adversely impact our ability to refinance existing debt.
We currently have, and may incur more, indebtedness that bears interest at variable rates. Accordingly, if interest rates increase, so will our interest costs, which would adversely affect our cash flow and our ability to pay principal and interest on our debt and our ability to make distributions to our shareholders. Further, rising interest rates could limit our ability to refinance existing debt when it matures.
Property ownership through joint ventures will limit our ability to act exclusively in our interests.
From time to time we invest in joint ventures in which we do not hold a controlling interest. These investments involve risks that do not exist with properties in which we own a controlling interest, including the possibility that our partners may, at any time, have business, economic or other objectives that are inconsistent with our objectives. In instances where we lack a controlling interest, our partners may be in a position to require action that is contrary to our objectives. While we seek to negotiate the terms of these joint ventures in a way that secures our ability to act in our best interests, there can be no assurance that those terms will be sufficient to fully protect us against actions contrary to our interests. If the objectives of our co-venturers are inconsistent with ours, we may not in every case be able to act exclusively in our interests.
Risks Related to the Real Estate Industry
Real estate investments are illiquid, and we may not be able to sell our Properties if and when we determine it is appropriate to do so.
Real estate generally cannot be sold quickly. We may not be able to dispose of Properties promptly in response to economic or other conditions. In addition, provisions of the Internal Revenue Code (the “Code”) limit a REITs ability to sell properties in some situations when it may be economically advantageous to do so, thereby adversely affecting returns to shareholders and adversely impacting our ability to meet our obligations to the holders of other securities.
We may experience economic harm if any damage to our Properties is not covered by insurance.
We believe all of our Properties are adequately insured. However, we cannot guarantee that the limits of our current policies will be sufficient in the event of a catastrophe to our Properties. Our existing property and liability policies expire during 2007. We cannot guarantee that we will be able to renew or duplicate our current coverages in adequate amounts or at reasonable prices.
We may suffer losses that are not covered under our comprehensive liability, fire, extended coverage and rental loss insurance policies. For example, we may not be insured for losses resulting from acts of war, certain acts of terrorism, or from environmental liabilities. If an uninsured loss or a loss in excess of insured limits should occur, we would nevertheless remain liable for the loss which could adversely affect cash flow from operations.
Potential liability for environmental contamination could result in substantial costs.
Under federal, state and local environmental laws, ordinances and regulations, we may be required to investigate and clean up the effects of releases of hazardous or toxic substances or petroleum products at our Properties simply because of our current or past ownership or operation of the real estate. If unidentified environmental problems arise, we may have to make substantial payments which could adversely affect our cash flow and our ability to make distributions to our shareholders because:
| | • | | as owner or operator, we may have to pay for property damage and for investigation and clean-up costs incurred in connection with the contamination |
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| | ��� | | the law typically imposes clean-up responsibility and liability regardless of whether the owner or operator knew of or caused the contamination |
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| | • | | even if more than one person may be responsible for the contamination, each person who shares legal liability under the environmental laws may be held responsible for all of the clean-up costs |
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| | • | | governmental entities and third parties may sue the owner or operator of a contaminated site for damages and costs |
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These costs could be substantial. The presence of hazardous or toxic substances or petroleum products or the failure to properly remediate contamination may materially and adversely affect our ability to borrow against, sell or rent an affected property. In addition, applicable environmental laws create liens on contaminated sites in favor of the government for damages and costs it incurs in connection with a contamination. Changes in laws increasing the potential liability for environmental conditions existing at our Properties may result in significant unanticipated expenditures.
It is our policy to retain independent environmental consultants to conduct Phase I environmental site assessments and asbestos surveys with respect to our acquisition of properties. These assessments generally include a visual inspection of the properties and the surrounding areas, an examination of current and historical uses of the properties and the surrounding areas and a review of relevant state, federal and historical documents, but do not involve invasive techniques such as soil and ground water sampling. Where appropriate, on a property-by-property basis, our practice is to have these consultants conduct additional testing, including sampling for asbestos, for lead in drinking water, for soil contamination where underground storage tanks are or were located or where other past site usages create a potential environmental problem, and for contamination in groundwater. Even though these environmental assessments are conducted, there is still the risk that:
| | • | | the environmental assessments and updates will not identify all potential environmental liabilities |
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| | • | | a prior owner created a material environmental condition that is not known to us or the independent consultants preparing the assessments |
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| | • | | new environmental liabilities have developed since the environmental assessments were conducted |
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| | • | | future uses or conditions such as changes in applicable environmental laws and regulations could result in environmental liability for us |
While we test indoor air quality on a regular basis and have an ongoing maintenance program in place to address this aspect of property operations, inquiries about indoor air quality may necessitate special investigation and, depending on the results, remediation. Indoor air quality issues can stem from inadequate ventilation, chemical contaminants from indoor or outdoor sources, pollen, viruses and bacteria. Indoor exposure to chemical or biological contaminants above certain levels can be alleged to be connected to allergic reactions or other health effects and symptoms in susceptible individuals. If these conditions were to occur at one of our Properties, we may need to undertake a targeted remediation program, including without limitation, steps to increase indoor ventilation rates and eliminate sources of contaminants. Such remediation programs could be costly, necessitate the temporary relocation of some or all of the Property’s tenants or require rehabilitation of the affected Property.
Our Properties may contain or develop harmful mold, which could lead to liability for adverse health effects and costs of remediating the problem.
When excessive moisture accumulates in buildings or on building materials, mold growth may occur, particularly if the moisture problem remains undiscovered or is not addressed over a period of time. Some molds may produce airborne toxins or irritants. Concern about indoor exposure to mold has been increasing as exposure to mold may cause a variety of adverse health effects and symptoms, including allergic or other reactions. As a result, the presence of significant mold at any of our Properties could require us to undertake a costly remediation program to contain or remove the mold from the affected Property. In addition, the presence of significant mold could expose us to liability from our tenants, employees of our tenants and others if property damage or health concerns arise.
Compliance with the Americans with Disabilities Act and fire, safety and other regulations may require us to make expenditures that adversely impact our operating results.
All of our Properties are required to comply with the Americans with Disabilities Act (“ADA”). The ADA generally requires that buildings be made accessible to people with disabilities. Compliance with the ADA requirements could require removal of access barriers, and non-compliance could result in imposition of fines by the United States government or an award of damages to private litigants, or both. Expenditures related to complying with the provisions of the ADA could adversely affect our results of operations and financial condition and our ability to make distributions to shareholders. In addition, we are required to operate our Properties in compliance with fire and safety regulations, building codes and other land use regulations, as they may be adopted by governmental agencies and bodies and become applicable to our Properties. We may be required to make substantial capital expenditures to comply with those requirements and these expenditures could have a material adverse effect on our operating results and financial condition, as well as our ability to make distributions to shareholders.
Terrorist attacks and other acts of violence or war may adversely impact our operating results and may affect markets on which our securities are traded.
Terrorist attacks against our Properties, or against the United States or United States interests generally, may negatively affect our operations and your investment in our securities. Attacks or armed conflicts could have a direct
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adverse impact on our Properties or operations through damage, destruction, loss or increased security costs. Any terrorism insurance that we obtain may be insufficient to cover the loss for damages to our Properties as a result of terrorist attacks.
Furthermore, any terrorist attacks or armed conflicts could result in increased volatility in or damage to the United States and worldwide financial markets and economy. Adverse economic conditions could affect the ability of our tenants to pay rent, which could have an adverse impact on our operating results.
Risks Related to Our Organization and Structure
We have elected REIT status under the federal tax laws, and could suffer adverse consequences if we fail to qualify as a REIT.
We have elected REIT status under federal tax laws and have taken the steps known to us to perfect that status, but we cannot be certain that we qualify, or that we will remain qualified. Qualification as a REIT involves the application of highly technical and complex provisions of the Code, as to which there are only limited judicial or administrative interpretations. The complexity of these provisions and of the related income tax regulations is greater in the case of a REIT that holds its assets in partnership form, as we do. Moreover, no assurance can be given that new tax laws will not significantly affect our qualification as a REIT or the federal income tax consequences of such qualification. New laws could be applied retroactively, which means that past operations could be found to be in violation, which would have a negative effect on the business.
If we fail to qualify as a REIT in any taxable year, the distributions to shareholders would not be deductible when computing taxable income. If this happened, we would be subject to federal income tax on our taxable income at regular corporate rates. Also, we could be prevented from qualifying as a REIT for the four years following the year in which we were disqualified. Further, if we requalified as a REIT after failing to qualify, we might have to pay the full corporate-level tax on any unrealized gain in our assets during the period we were not qualified as a REIT. We would then have to distribute to our shareholders the earnings we accumulated while we were not qualified as a REIT. These additional taxes would reduce our funds available for distribution to our shareholders. In addition, while we were disqualified as a REIT, we would not be required by the Code to make distributions to our shareholders. A failure by the Company to qualify as a REIT and the resulting requirement to pay taxes and interest (and perhaps penalties) would cause us to default under various agreements to which we are a party, including under our credit facility, and would have a material adverse effect on our business, prospects, results of operations, earnings, financial condition and our ability to make distributions to shareholders.
Future economic, market, legal, tax or other considerations may lead our Board of Trustees to authorize the revocation of our election to qualify as a REIT. A revocation of our REIT status would require the consent of the holders of a majority of the voting interests of all of our outstanding Common Shares.
Risks associated with potential borrowings necessary to make distributions to qualify as a REIT.
We intend to make distributions to shareholders to comply with the distribution provisions of the Code necessary to maintain qualification as a REIT and to avoid income taxes and the non-deductible excise tax. Under certain circumstances, we may be required to borrow funds to meet the distribution requirements necessary to achieve the tax benefits associated with qualifying as a REIT. In such circumstances, we might need to borrow funds to avoid adverse tax consequences, even if our management believes that the prevailing market conditions are not generally favorable for such borrowings or that such borrowings would not be advisable in the absence of such tax considerations.
Certain officers of the Trust may not have the same interests as shareholders as to certain tax laws.
Certain officers of the Trust own Common Units. These units may be exchanged for our Common Shares. The officers who own those units and have not yet exchanged them for our Common Shares may suffer different and more adverse tax consequences than holders of our Common Shares suffer in certain situations:
| | • | | when certain of our Properties are sold |
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| | • | | when debt on those Properties is refinanced |
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| | • | | if we are involved in a tender offer or merger |
Because these officers own units and face different consequences than shareholders do, the Trust and those officers may have different objectives as to these transactions than shareholders do.
Certain aspects of our organization could have the effect of restricting or preventing a change of control of our Company, which could have an adverse effect on the price of our shares.
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Our charter contains an ownership limit on shares.To qualify as a REIT, five or fewer individuals cannot own, directly or indirectly, more than 50% in value of the outstanding shares of beneficial interest. To this end, our Declaration of Trust, among other things, generally prohibits any holder of the Trust’s shares from owning more than 5% of the Trust’s outstanding shares of beneficial interest, unless that holder gets the consent from the Board of Trustees. This limitation could prevent the acquisition of control of the Company by a third party without the consent from the Board of Trustees.
We have a staggered board and certain restrictive nominating procedures. The Board of Trustees has three classes of trustees. The term of office of one class expires each year. Trustees for each class are elected for three-year terms as that class’ term expires. The terms of the Class I, Class II, and Class III trustees expire in 2007, 2008, and 2009, respectively. Any nominee for trustee must be selected under the nominating provisions contained in our Declaration of Trust and By-Laws. The staggered terms for trustees and the nominating procedures may affect shareholders’ ability to take control of the Company, even if a change in control were in the shareholders’ interest.
We can issue preferred shares. Our Declaration of Trust authorizes the Board of Trustees to establish the preferences and rights of any shares issued. The issuance of preferred shares could have the effect of delaying, making more difficult or preventing a change of control of the Company, even if a change in control were in the shareholder’s interest.
We have a poison pill. Under the shareholder rights plan, rights are issued along with each of the Trust’s Common Shares. Holders of these rights can purchase, under certain conditions, a portion of a preferred share of beneficial interest, or receive Common Shares, or common shares of an entity acquiring us, or other consideration, having a value equal to twice the exercise price of the right. The exercise price of the right is $200. This arrangement is often called a “poison pill.” Our poison pill could have the effect of delaying or preventing a change of control of the Company, even if a change in control were in the shareholders’ interest.
There are limitations on acquisition of and changes in control pursuant to, and fiduciary protections of The Board under Maryland law. The Maryland General Corporation Law (“MGCL”) contains provisions which are applicable to the Trust as if the Trust were a corporation. Among these provisions is a section, referred to as the “control share acquisition statute,” which eliminates the voting rights of shares acquired in quantities so as to constitute “control shares,” as defined under the MGCL. The MGCL also contains provisions applicable to us that are referred to as the “business combination statute,” which would generally limit business combinations between the Company and any 10% owners of the Trust’s shares or any affiliate thereof. Further, Maryland law provides broad discretion to the Board with respect to its fiduciary duties in considering a change in control of our Company, including that the Board is subject to no greater level of scrutiny in considering a change in control transaction than with respect to any other act by the Board. Finally, the “unsolicited takeovers” provisions of the MGCL permit the Board, without shareholder approval and regardless of what is currently provided in our Declaration of Trust or By-Laws, to implement takeover defenses that our Company does not yet have, including: permitting only the Board to fix the size of the Board and permitting only the Board to fill a vacancy on the Board. All of these provisions may have the effect of inhibiting a third party from making an acquisition proposal for our Company or of delaying, deferring or preventing a change in control of the Company under circumstances that otherwise could provide the holders of Common Shares with the opportunity to realize a premium over the then current market price.
Various factors out of our control could hurt the market value of our publicly traded securities.
General market conditions could worsen. The value of our publicly traded securities depends on various market conditions, which may change from time to time. In addition to general economic and market conditions and our particular financial condition and performance, the value of our publicly traded securities could be affected by, among other things, the extent of institutional investor interest in us and the market’s opinion of REITs in general and, in particular, REITs that own and operate properties similar to ours.
The market value of the equity securities of a REIT may be based primarily upon the market’s perception of the REITs growth potential and its current and future cash distributions, and may be secondarily based upon the real estate market value of the underlying assets. The failure to meet the market’s expectations with regard to future earnings and cash distributions likely would adversely affect the market price of publicly traded securities.
Rising market interest rates could make an investment in publicly traded securities less attractive. If market interest rates increase, purchasers of publicly traded securities may demand a higher annual yield on the price they pay for their securities. This could adversely affect the market price of publicly traded securities.
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Transactions by the Trust or the Operating Partnership could adversely affect debt holders.
Except with respect to several covenants limiting the incurrence of indebtedness and a covenant requiring the Operating Partnership to maintain a certain unencumbered total asset value, our indentures do not contain any additional provisions that would protect holders of the Operating Partnership’s debt securities in the event of (i) a highly leveraged transaction involving the Operating Partnership, (ii) a change of control, or (iii) certain reorganizations, restructurings, mergers or similar transactions involving the Operating Partnership or the Trust.
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ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
The Properties in Operation, as of December 31, 2006, consisted of 422 industrial and 298 office properties. Single tenants completely occupy 241 Properties in Operation. These tenants generally require a reduced level of service in connection with the operation or maintenance of these properties. The remaining 479 of the Company’s Properties in Operation are multi-tenant properties for which the Company renders a range of building, operating and maintenance services.
As of December 31, 2006, the industrial Properties in Operation were 95.4% leased. The average building size for the industrial Properties in Operation was approximately 106,000 square feet. As of December 31, 2006, the office Properties in Operation were 91.4% leased. The average building size for the office Properties in Operation was approximately 70,000 square feet.
A complete listing of the Properties in Operation appears as Schedule III to the financial statements of the Company included in this report. The table below sets forth certain information on the Company’s Properties in Operation as of December 31, 2006 (in thousands, except percentages).
| | | | | | | | | | | | | | | | | | | |
| | | Type | | Net Rent (1) | | | Square Feet | | | % Leased | |
Delaware Valley | | Industrial | | -Distribution | | $ | 6,756 | | | | 781 | | | | 100.0 | % |
| | | | | | | -Flex | | | 29,130 | | | | 2,787 | | | | 96.9 | % |
| | | Office | | | | | 116,619 | | | | 8,418 | | | | 92.4 | % |
| | | | | | | | | | | | | | | | |
| | | Total | | | | | 152,505 | | | | 11,986 | | | | 94.0 | % |
| | | | | | | | | | | | | | | | |
Midwest | | Industrial | | -Distribution | | | 53,862 | | | | 13,462 | | | | 98.1 | % |
| | | | | | | -Flex | | | 41,307 | | | | 5,293 | | | | 95.1 | % |
| | | Office | | | | | 46,585 | | | | 4,050 | | | | 90.5 | % |
| | | | | | | | | | | | | | | | |
| | | Total | | | | | 141,754 | | | | 22,805 | | | | 96.1 | % |
| | | | | | | | | | | | | | | | |
Mid-Atlantic | | Industrial | | -Distribution | | | 28,090 | | | | 7,590 | | | | 88.8 | % |
| | | | | | | -Flex | | | 8,003 | | | | 992 | | | | 94.8 | % |
| | | Office | | | | | 51,415 | | | | 4,380 | | | | 90.3 | % |
| | | | | | | | | | | | | | | | |
| | | Total | | | | | 87,508 | | | | 12,962 | | | | 89.7 | % |
| | | | | | | | | | | | | | | | |
Florida | | Industrial | | -Distribution | | | 19,981 | | | | 4,390 | | | | 100.0 | % |
| | | | | | | -Flex | | | 26,535 | | | | 3,484 | | | | 93.9 | % |
| | | Office | | | | | 39,260 | | | | 3,498 | | | | 90.8 | % |
| | | | | | | | | | | | | | | | |
| | | Total | | | | | 85,776 | | | | 11,372 | | | | 95.3 | % |
| | | | | | | | | | | | | | | | |
United Kingdom | | Industrial | | -Distribution | | | — | | | | — | | | | — | |
| | | | | | | -Flex | | | — | | | | — | | | | — | |
| | | Office | | | | | 987 | | | | 35 | | | | 97.0 | % |
| | | | | | | | | | | | | | | | |
| | | Total | | | | | 987 | | | | 35 | | | | 97.0 | % |
| | | | | | | | | | | | | | | | |
Joint Ventures (2) | | Industrial | | -Distribution | | | 21,285 | | | | 5,638 | | | | 94.4 | % |
| | | | | | | -Flex | | | 5,352 | | | | 170 | | | | 100.0 | % |
| | | Office | | | | | 12,688 | | | | 364 | | | | 98.1 | % |
| | | | | | | | | | | | | | | | |
| | | Total | | | | | 39,325 | | | | 6,172 | | | | 94.8 | % |
| | | | | | | | | | | | | | | | |
TOTAL | | Industrial | | -Distribution | | | 129,974 | | | | 31,861 | | | | 95.5 | % |
| | | | | | | -Flex | | | 110,327 | | | | 12,726 | | | | 95.2 | % |
| | | Office | | | | | 267,554 | | | | 20,745 | | | | 91.4 | % |
| | | | | | | | | | | | | | | | |
| | | Total | | | | $ | 507,855 | | | | 65,332 | | | | 94.2 | % |
| | | | | | | | | | | | | | | | |
| | |
| (1) | | Net rent represents the contractual rent per square foot times the tenant’s square feet leased at December 31, 2006 for tenants in occupancy. Net rent does not include the tenant’s obligation to pay property operating expenses and real estate taxes. |
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| (2) | | Joint Ventures represent the 48 properties owned by unconsolidated joint ventures in which the Company has an interest. |
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The expiring square feet and annual net rent by year for the Properties in Operation as of December 31, 2006 are as follows (in thousands except percentages):
Total Properties in Operation
Wholly Owned Properties:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Industrial- | | | | | | | | | | |
| | | Distribution | | | Industrial-Flex | | | Office | | | Total | |
| | | Square | | | Annual | | | Square | | | Annual | | | Square | | | Annual | | | Square | | | Annual | |
| Year | | Feet | | | Net Rent (1) | | | Feet | | | Net Rent (1) | | | Feet | | | Net Rent (1) | | | Feet | | | Net Rent (1) | |
| 2007 | | | 3,079 | | | $ | 13,729 | | | | 1,641 | | | $ | 14,143 | | | | 1,934 | | | $ | 25,702 | | | | 6,654 | | | $ | 53,574 | |
| 2008 | | | 3,915 | | | | 15,410 | | | | 2,351 | | | | 22,234 | | | | 2,529 | | | | 37,024 | | | | 8,795 | | | | 74,668 | |
| 2009 | | | 4,051 | | | | 18,857 | | | | 2,238 | | | | 20,789 | | | | 2,968 | | | | 43,813 | | | | 9,257 | | | | 83,459 | |
| 2010 | | | 2,654 | | | | 13,114 | | | | 1,615 | | | | 15,409 | | | | 2,607 | | | | 37,342 | | | | 6,876 | | | | 65,865 | |
| 2011 | | | 3,271 | | | | 15,004 | | | | 1,220 | | | | 12,426 | | | | 2,481 | | | | 38,357 | | | | 6,972 | | | | 65,787 | |
| 2012 | | | 2,762 | | | | 14,043 | | | | 1,025 | | | | 10,181 | | | | 1,352 | | | | 24,896 | | | | 5,139 | | | | 49,120 | |
| Thereafter | | | 5,385 | | | | 30,787 | | | | 1,855 | | | | 21,065 | | | | 4,735 | | | | 79,125 | | | | 11,975 | | | | 130,977 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| |
| Total | | | 25,117 | | | $ | 120,944 | | | | 11,945 | | | $ | 116,247 | | | | 18,606 | | | $ | 286,259 | | | | 55,668 | | | $ | 523,450 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Total Square Feet | | | 26,223 | | | | | | | | 12,556 | | | | | | | | 20,381 | | | | | | | | 59,160 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Percent of Total Annual Net Rent | | | | | | | 23.1 | % | | | | | | | 22.2 | % | | | | | | | 54.7 | % | | | | | | | 100.0 | % |
| | | | | | | | | | | | | | | �� | | | | | | | | | | | | | | |
Joint Venture Properties:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Industrial- | | | | | | | | | | |
| | | Distribution | | | Industrial-Flex | | | Office | | | Total | |
| | | Square | | | Annual | | | Square | | | Annual | | | Square | | | Annual | | | Square | | | Annual | |
| Year | | Feet | | | Net Rent (1) | | | Feet | | | Net Rent (1) | | | Feet | | | Net Rent (1) | | | Feet | | | Net Rent (1) | |
| 2007 | | | 833 | | | $ | 3,230 | | | | 65 | | | $ | 1,958 | | | | 29 | | | $ | 1,018 | | | | 927 | | | $ | 6,206 | |
| 2008 | | | 920 | | | | 3,883 | | | | 9 | | | | 296 | | | | 31 | | | | 1,050 | | | | 960 | | | | 5,229 | |
| 2009 | | | 751 | | | | 2,874 | | | | 11 | | | | 316 | | | | 61 | | | | 2,197 | | | | 823 | | | | 5,387 | |
| 2010 | | | 57 | | | | 296 | | | | 20 | | | | 723 | | | | 65 | | | | 2,470 | | | | 142 | | | | 3,489 | |
| 2011 | | | 362 | | | | 1,524 | | | | 10 | | | | 333 | | | | 86 | | | | 2,966 | | | | 458 | | | | 4,823 | |
| 2012 | | | 94 | | | | 563 | | | | — | | | | — | | | | 85 | | | | 3,009 | | | | 179 | | | | 3,572 | |
| Thereafter | | | 2,304 | | | | 11,372 | | | | 55 | | | | 1,800 | | | | — | | | | — | | | | 2,359 | | | | 13,172 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Total | | | 5,321 | | | $ | 23,742 | | | | 170 | | | $ | 5,426 | | | | 357 | | | $ | 12,710 | | | | 5,848 | | | $ | 41,878 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| |
| Total Square Feet | | | 5,638 | | | | | | | | 170 | | | | | | | | 364 | | | | | | | | 6,172 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Percent of Total Annual Net Rent | | | | | | | 56.7 | % | | | | | | | 13.0 | % | | | | | | | 30.3 | % | | | | | | | 100.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | |
| (1) | | Annual net rent equals the contractual rent per square foot at the time of lease expiration for those tenants in occupancy at December 31, 2006 times the tenant’s square feet leased at December 31, 2006. |
The table below highlights, for the Properties in Operation, the Company’s top ten office tenants and the top ten industrial tenants as of December 31, 2006.
| | | | | | | |
| | | Percentage | | | | Percentage |
| Top 10 Office Tenants | | of Net Rent | | Top 10 Industrial Tenants | | of Net Rent |
| The Vanguard Group, Inc | | 3.8% | | Kellogg USA, Inc. | | 1.0% |
| GlaxoSmithKline, LLC | | 1.9% | | Wakefern Food Corporation | | 1.0% |
| General Motors Acceptance Corporation | | 1.3% | | United States of America | | 0.7% |
| PHH Corporation | | 1.2% | | Amazon.com, Inc. | | 0.6% |
| Sanofi-Aventis U.S., Inc. | | 1.1% | | United Parcel Service, Inc. | | 0.5% |
| PNC Bank, National Association | | 1.0% | | Centocor, Inc. | | 0.5% |
| Aetna Life Insurance Company | | 1.0% | | LTD Commodities, Inc. | | 0.5% |
| Express Scripts | | 0.9% | | Whirlpool Corporation | | 0.5% |
| Well Care Health Plan, Inc. | | 0.9% | | Bosch Rexroth Corporation | | 0.5% |
| Sungard Data Systems, Inc. | | 0.7% | | Dial Corporation | | 0.4% |
| | | | | |
| | | 13.8% | | | | 6.2% |
| | | | | |
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ITEM 3. LEGAL PROCEEDINGS
The ownership of property and provision of services to the public entails an inherent risk of liability. Although the Company is engaged in litigation incidental to its business, there is no legal proceeding to which it is a party which, in the opinion of management, will materially adversely affect the results of the Company’s operations. The Company carries liability insurance against certain types of claims that management believes meets industry standards; however, there can be no assurance that any future legal proceedings (including any related judgments, settlements or costs) will not materially adversely affect the Company’s financial condition, liquidity, or results of operations.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the fourth quarter of the year ended December 31, 2006.
PART II
| ITEM 5. MARKET FOR THE REGISTRANTS’ COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND RELATED ISSUER PURCHASES OF EQUITY SECURITIES |
The Common Shares are traded on the New York Stock Exchange under the symbol “LRY.” There is no established public trading market for the Common Units. The following table sets forth, for the calendar quarters indicated, the high and low closing prices of the Common Shares on the New York Stock Exchange, and the dividends declared per Common Share for such calendar quarter.
| | | | | | | | | | | | | |
| | | | | | | | | | | Dividends |
| | | | | | | | | | | Declared Per |
| | | High | | Low | | Common Share |
2006 | | | | | | | | | | | | |
| Fourth Quarter | | $ | 52.35 | | | $ | 45.73 | | | $ | 0.62 | |
| Third Quarter | | | 48.23 | | | | 43.80 | | | | 0.62 | |
| Second Quarter | | | 46.41 | | | | 41.32 | | | | 0.615 | |
| First Quarter | | | 48.99 | | | | 43.20 | | | | 0.615 | |
2005 | | | | | | | | | | | | |
| Fourth Quarter | | $ | 43.98 | | | $ | 39.15 | | | $ | 0.615 | |
| Third Quarter | | | 45.80 | | | | 40.80 | | | | 0.615 | |
| Second Quarter | | | 44.77 | | | | 38.19 | | | | 0.61 | |
| First Quarter | | | 43.09 | | | | 38.77 | | | | 0.61 | |
As of February 23, 2007, the Common Shares were held by 1,360 holders of record. Since its initial public offering in 1994, the Company has paid regular and uninterrupted quarterly dividends.
Although the Company currently anticipates that comparable cash dividends will continue to be paid in the future, the payment of future dividends by the Company will be at the discretion of the Board of Trustees and will depend on numerous factors including the Company’s cash flow, its financial condition, capital requirements, annual distribution requirements under the REIT provisions of the Internal Revenue Code of 1986, as amended, and such other factors as the Board of Trustees deems relevant.
19
ITEM 6. SELECTED FINANCIAL DATA
The following table sets forth Selected Financial Data for Liberty Property Trust and Liberty Property Limited Partnership as of and for the years ended December 31, 2006, 2005, 2004, 2003 and 2002. The information set forth below should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the financial statements and notes thereto appearing elsewhere in this report. Certain amounts from prior years have been reclassified to conform to current-year presentation.
| | | | | | | | | | | | | | | | | | | | | |
| Operating Data | | Year Ended December 31, |
| In thousands, except per share data | | 2006 | | 2005 | | 2004 | | 2003 | | 2002 |
| Total operating revenue | | $ | 666,719 | | | $ | 633,494 | | | $ | 585,284 | | | $ | 552,183 | | | $ | 521,122 | |
| Income from continuing operations | | $ | 153,697 | | | $ | 204,841 | | | $ | 137,588 | | | $ | 133,525 | | | $ | 132,933 | |
| Income available to common shareholders | | $ | 266,574 | | | $ | 249,351 | | | $ | 161,443 | | | $ | 163,610 | | | $ | 150,237 | |
| | | | | | | | | | | | | | | | | | | | | |
| Basic: | | | | | | | | | | | | | | | | | | | | |
| Income from continuing operations | | $ | 1.72 | | | $ | 2.36 | | | $ | 1.63 | | | $ | 1.70 | | | $ | 1.62 | |
| Income from discontinued operations | | $ | 1.26 | | | $ | 0.51 | | | $ | 0.28 | | | $ | 0.38 | | | $ | 0.38 | |
| Income per common share — basic | | $ | 2.98 | | | $ | 2.87 | | | $ | 1.91 | | | $ | 2.08 | | | $ | 2.00 | |
| Diluted: | | | | | | | | | | | | | | | | | | | | |
| Income from continuing operations | | $ | 1.70 | | | $ | 2.32 | | | $ | 1.60 | | | $ | 1.67 | | | $ | 1.59 | |
| Income from discontinued operations | | $ | 1.25 | | | $ | 0.50 | | | $ | 0.28 | | | $ | 0.38 | | | $ | 0.38 | |
| Income per common share — diluted | | $ | 2.95 | | | $ | 2.82 | | | $ | 1.88 | | | $ | 2.05 | | | $ | 1.97 | |
| Distributions paid per common share | | $ | 2.465 | | | $ | 2.445 | | | $ | 2.425 | | | $ | 2.405 | | | $ | 2.37 | |
| Distributions paid per preferred share | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 1.82 | |
| Weighted average number of shares outstanding — basic (1) | | | 89,313 | | | | 86,986 | | | | 84,534 | | | | 78,575 | | | | 75,041 | |
| Weighted average number of shares outstanding — diluted (2) | | | 90,492 | | | | 88,376 | | | | 86,024 | | | | 79,868 | | | | 76,272 | |
| | | | | | | | | | | | | | | | | | | | | |
| Balance Sheet Data | | December 31, |
| In thousands | | 2006 | | 2005 | | 2004 | | 2003 | | 2002 |
| Net real estate | | $ | 4,419,838 | | | $ | 4,035,529 | | | $ | 3,738,758 | | | $ | 3,483,188 | | | $ | 3,312,229 | |
| Total assets | | | 4,910,911 | | | | 4,500,322 | | | | 4,163,997 | | | | 3,833,528 | | | | 3,625,099 | |
| Total indebtedness | | | 2,387,938 | | | | 2,249,178 | | | | 2,133,171 | | | | 1,885,866 | | | | 1,866,187 | |
| Shareholders’ equity | | | 1,871,604 | | | | 1,709,182 | | | | 1,596,259 | | | | 1,544,897 | | | | 1,354,431 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Other Data | | | | | | Year Ended December 31, |
| Dollars in thousands | | | | | | 2006 | | 2005 | | 2004 | | 2003 | | 2002 |
| Cash provided by operating activities | | | | | | $ | 344,901 | | | $ | 360,749 | | | $ | 293,336 | | | $ | 263,811 | | | $ | 288,243 | |
| Cash used in investing activities | | | | | | | (355,270 | ) | | | (286,633 | ) | | | (373,975 | ) | | | (195,133 | ) | | | (165,604 | ) |
| Cash (used in) provided by financing activities | | | | | | | (327 | ) | | | (39,470 | ) | | | 89,618 | | | | (58,111 | ) | | | (131,818 | ) |
| Funds from operations available to common shareholders (3) | | | | | | | 294,801 | | | | 293,973 | | | | 291,144 | | | | 280,921 | | | | 260,750 | |
| Total leaseable square footage of properties at end of period (in thousands) (4) | | | | | | | 65,332 | | | | 64,371 | | | | 61,655 | | | | 57,149 | | | | 54,166 | |
| Number of properties at end of period (4) | | | | | | | 720 | | | | 718 | | | | 723 | | | | 702 | | | | 680 | |
| Percentage leased at end of period (4) | | | | | | | 94 | % | | | 92 | % | | | 92 | % | | | 92 | % | | | 91 | % |
| | |
| (1) | | Basic weighted average number of shares includes only vested Common Shares outstanding during the year. |
| |
| (2) | | Diluted weighted average number of shares outstanding includes the vested and unvested Common Shares outstanding during the year as well as the dilutive effect of outstanding options. |
| |
| (3) | | The National Association of Real Estate Investment Trusts (“NAREIT”) has issued a standard definition for Funds from operations (as defined below). The Securities and Exchange Commission has agreed to the disclosure of this non-GAAP financial measure on a per share basis in its Release No. 34-47226, Conditions for Use of Non-GAAP Financial Measures. The Company believes that the calculation of Funds from operations is helpful to investors and management as it is a measure of the Company’s operating performance that excludes depreciation and amortization and gains and losses from property dispositions. As a result, year over year comparison of Funds from operations reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses, and interest costs, providing perspective not immediately apparent from net income. In addition, management believes that Funds from operations provides useful information to the investment community about the Company’s financial performance when compared to other REITs since Funds from operations is generally recognized as the standard for reporting the operating performance of a REIT. Funds from operations available to common shareholders is defined by NAREIT as net income (computed in accordance with generally accepted accounting principles (“GAAP”)), excluding gains (or losses) from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Funds from operations available to common shareholders does not represent net income or cash flows from operations as defined by GAAP and does not necessarily indicate that cash flows will be sufficient to fund cash needs. It should not be considered as an alternative to net income as an indicator of the Company’s operating performance or to cash flows as a measure of liquidity. Funds from operations available to common shareholders also does not represent cash flows generated from operating, investing or financing activities as defined by GAAP. A reconciliation of Funds from operations to net income may be found on page 31. |
| |
| (4) | | Leasing statistics include 48 properties equaling 6.2 million square feet owned by joint ventures in which the Company has an ownership interest. The joint venture properties are 94.8% leased at December 31, 2006. |
20
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (a “REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the “Operating Partnership” and, collectively with the Trust and their consolidated subsidiaries, the “Company”).
As of December 31, 2006, the Company had an ownership interest in and operated 422 industrial and 298 office properties located primarily in the Mid-Atlantic, Southeastern and Midwestern United States and the United Kingdom (the “Properties in Operation”) totaling 65.3 million square feet. The Company recently announced its intention to enter the Phoenix, Arizona market and exit the Michigan market. In addition, as of December 31, 2006, the Company had an ownership interest in 38 properties under development (the “Properties under Development” and, together with the Properties in Operation, the “Properties”) and had an ownership interest in 1,607 acres of land, substantially all of which is zoned for commercial use. Included within the Properties and land above are 38 industrial and 10 office properties comprising 6.2 million square feet, five development properties comprising 1.1 million square feet and 283 acres of developable land owned by unconsolidated joint ventures in which the Company has an interest.
The Company focuses on creating value for shareholders and increasing profitability and cash flow. With respect to its Properties in Operation, the Company endeavors to maintain high occupancy levels while increasing rental rates. The Company pursues development opportunities that it believes will create value and yield acceptable returns. The Company also acquires properties that it believes will create long-term value, and disposes of properties that no longer fit within the Company’s strategic objectives or in situations where it can optimize cash proceeds. The Company’s operating results depend primarily upon income from rental operations and are substantially influenced by rental demand for the Properties in Operation.
Rental demand for the Properties in Operation generally improved during the year ended December 31, 2006. Although in some markets the Company continues to experience market conditions characterized by an oversupply of leaseable space and soft demand, the Company believes that the majority of its markets are recovering from a generally slow real estate economy. Rental rates in many of the Company’s markets have stabilized or improved. The Company successfully leased 14.9 million square feet during the year ended December 31, 2006 and attained occupancy of 94.2% as of that date. The Company believes that straight line rents on renewal and replacement leases for 2007 will on average be 1% to 3% greater than rents on expiring leases, notwithstanding selected decreases. Furthermore, the Company believes that average occupancy for its Properties in Operation will improve by 1% to 2% for 2007 compared to 2006.
Conditions in 2006 for the acquisition of properties continued to be very competitive. During the year ended December 31, 2006, the Company acquired 23 properties representing 2.5 million square feet for a Total Investment, as defined below, of $306.5 million. These acquisitions generally served to increase the Company’s presence or balance the product mix in markets the Company believes to have significant potential. For 2007, the Company believes that property acquisitions will be in the $450 to $550 million range and that, similar to 2006, certain of the acquired properties will be either vacant or underleased. The Company executes acquisitions of such properties when it believes that they are attractively priced and will positively contribute to earnings upon lease up and stabilization. As previously noted, the Company has recently announced its intention to enter the Phoenix, Arizona market. It is anticipated that a substantial portion of the overall planned acquisition activity will be used to facilitate the Company’s entry into this market. “Total Investment” for a property is defined as the property’s purchase price plus closing costs and management’s estimate, as determined at the time of acquisition, of the cost of necessary building improvements in the case of acquisitions, or land costs and land and building improvement costs in the case of development projects, and, where appropriate, other development costs and carrying costs.
As the Company expected, dispositions of properties in 2006 were significant. This disposition activity allowed the Company to (1) reduce its holdings in certain markets and product types within a market; (2) lower the average age of the portfolio; and (3) take advantage of favorable market conditions to optimize the cash proceeds from the sale of certain assets. During 2006, the Company realized proceeds of $398.2 million from the sale of 40 operating properties representing 4.0 million square feet and five acres of land. Additionally, during 2006, the Company sold six operating properties and 104 acres of land to a joint venture in which the Company retained a 25% interest for $125.0 million. The real estate investment market continues to be very strong. Given this situation, the Company anticipates that disposition
21
activity will be in the $350 million to $450 million range for 2007. A substantial portion of the planned disposition activity will be related to the Company’s planned exit from the Michigan market.
In 2006, the Company also continued to pursue development opportunities. During the year ended December 31, 2006, the Company brought into service 21 development properties representing 2.3 million square feet and a Total Investment of $211.8 million and initiated $310.1 million in real estate development. As of December 31, 2006, the projected Total Investment of the wholly owned Properties under Development (excluding the Comcast Center) was $456.3 million. The projected Total Investment for the 1.25 million square foot Comcast Center is $495 million. Although in April 2006 the Company entered into a joint venture, whereby the Company sold an 80% interest in the equity of the Comcast Center, the terms of the joint venture obligate the Company to complete the development of the building and consequently this development is treated as a wholly owned Property under Development. In 2007, the Company will continue to pursue development opportunities and the Company believes that it will bring into service from its development pipeline approximately $325 to $350 million of Total Investment in operating real estate.
The Company periodically enters into joint venture relationships in connection with the execution of its real estate operating strategy. During the year ended December 31, 2006, the Company entered into two joint ventures. See Note 4 to the Company’s financial statements. The Company believes that joint ventures in which the Company holds an ownership interest will acquire properties in the $75 to $100 million range in 2007. In addition, during the year ended December 31, 2006, unconsolidated joint ventures initiated $85.1 million in real estate development.
Forward-Looking Statements
When used throughout this report, the words “believes,” “anticipates,” “hopes” and “expects” and similar expressions are intended to identify forward-looking statements. Such statements indicate that assumptions have been used that are subject to a number of risks and uncertainties which could cause actual financial results or management plans and objectives to differ materially from those projected or expressed herein, including: the effect of national and regional economic conditions; rental demand; the Company’s ability to identify and secure additional properties and sites that meet its criteria for acquisition or development; the availability and cost of capital; the effect of prevailing market interest rates; and other risks described from time to time in the Company’s filings with the SEC. Given these uncertainties, readers are cautioned not to place undue reliance on such statements.
Critical Accounting Policies and Estimates
The Company’s discussion and analysis of its financial condition and results of operations are based upon the Company’s consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires the Company to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. The Company bases these estimates, judgments and assumptions on historical experience and on other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.
The Company believes the following critical policies affect its more significant estimates and assumptions used in the preparation of its consolidated financial statements.
Capitalized Costs
Expenditures directly related to the acquisition, or improvement of real estate, including interest and other costs capitalized on development projects and land being readied for development, are included in net real estate and are stated at cost. The Company considers a development property substantially complete upon the completion of tenant build-out, but no later than one year after the completion of major construction activity. The capitalized costs include pre-construction costs essential to the development of the property, construction costs, interest costs, real estate taxes, development related salaries and other costs incurred during the period of development. Capitalized development related salaries and benefits historically represent approximately 1% to 2% of the cost of developed properties. The determination to capitalize rather than expense costs requires the Company to evaluate the status of the development activity. Capitalized interest for the years ended December 31, 2006, 2005, and 2004 was $30.8 million, $17.7 million and $13.2 million, respectively.
22
Revenue Recognition
Rental revenue is recognized on a straight line basis over the terms of the respective leases. Deferred rent receivable represents the amount by which straight line rental revenue exceeds rents currently billed in accordance with the lease agreements. 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) management’s estimate of fair market lease rates for each corresponding in-place lease. The capitalized above or below-market lease values are amortized as a component of rental revenue over the remaining term of the respective leases.
Allowance for Doubtful Accounts
The Company monitors the liquidity and creditworthiness of its tenants on an on-going basis. Based on these reviews, provisions are established, and an allowance for doubtful accounts for estimated losses resulting from the inability of its tenants to make required rental payments is maintained. As of December 31, 2006 and 2005, the Company’s allowance for doubtful accounts totaled $5.1 million and $6.7 million, respectively. The Company’s bad debt expense for the years ended December 31, 2006, 2005 and 2004 was $1.0 million, $2.6 million and $2.4 million, respectively. During the year ended December 31, 2006, the Company realized $2.0 million from the settlement of a tenant bankruptcy.
Impairment of Real Estate
The Company evaluates its real estate investments and investments in unconsolidated joint ventures upon occurrence of significant adverse changes in operations to assess whether any impairment indicators are present that affect the recovery of the recorded value. If any real estate investment is considered impaired, the carrying value of the property is written down to its estimated fair value. During the years ended December 31, 2006 and 2005, the Company recognized impairment losses of $4.2 million and $5.3 million, respectively. The 2006 impairment loss of $4.2 million was primarily related to a 352,000 square foot portfolio of operating properties in Michigan. These properties were sold in January 2007. The 2005 impairment loss was primarily related to a 615,000 square foot portfolio of operating properties in Michigan. A portion of these propebties equaling 477,000 square feet were sold prior to December 31, 2006. The determination of whether impairment exists requires the Company to make estimates, judgments and assumptions about the future utility of the assets. The Company has evaluated each of its Properties and land held for development and investments in unconsolidated joint ventures and has determined that there are no additional valuation adjustments that need to be made at December 31, 2006.
Intangibles
In accordance with the Financial Accounting Standards Board (“FASB”) Statement of Financial Standards (“SFAS”) No. 141, “Business Combinations,” the Company allocates the purchase price of real estate acquired to land, building and improvements and intangibles based on the relative fair value of each component. The value ascribed to in-place leases is based on the rental rates for the existing leases compared to the Company’s estimate of the fair market lease rates for leases of similar terms and present valuing the difference based on an interest rate which reflects the risks associated with the leases acquired. Origination values are also assigned to in-place leases, and, where appropriate, value is assigned to customer relationships. Origination cost estimates include the costs to execute leases with terms similar to the remaining lease terms of the in-place leases, including leasing commissions, legal and other related expenses. Additionally, the Company estimates carrying costs during the expected lease-up periods including real estate taxes, other operating expenses and lost rentals at contractual rates. The Company depreciates the amounts allocated to building and improvements over 40 years. The amounts allocated to the intangible relating to in-place leases, which are included in deferred financing and leasing costs or in other liabilities in the accompanying balance sheets, are amortized over the remaining term of the related leases. In the event that a tenant terminates its lease, the unamortized portion of the intangible is written off.
Results of Operations
The following discussion is based on the consolidated financial statements of the Company. It compares the results of operations of the Company for the year ended December 31, 2006 with the results of operations of the Company for the year ended December 31, 2005, and the results of operations of the Company for the year ended December 31, 2005 with the results of operations of the Company for the year ended December 31, 2004. As a result of the varying level of development, acquisition and disposition activities by the Company in 2006, 2005 and 2004, the overall operating results of the Company during such periods are not directly comparable. However, certain data, including the Same Store results, do lend themselves to direct comparison.
This information should be read in conjunction with the accompanying consolidated financial statements and notes included elsewhere in this report.
23
Comparison of Year Ended December 31, 2006 to Year Ended December 31, 2005
Overview
The Company’s average gross investment in operating real estate owned for the year ended December 31, 2006 increased to $4,168.0 million from $3,697.6 million for the year ended December 31, 2005. This increase in operating real estate resulted in increases in rental revenue, operating expense reimbursement, rental property expenses, real estate taxes, and depreciation and amortization expense.
Total operating revenue increased to $666.7 million for the year ended December 31, 2006 from $633.5 million for the year ended December 31, 2005. This $33.2 million increase was primarily due to the increase in investment in operating real estate and the increase in operating revenue from the Same Store group of properties – see below. These increases were partially offset by a decrease in “Termination Fees,” which totaled $6.2 million for the year ended December 31, 2006 as compared to $16.6 million for the year ended December 31, 2005. Termination Fees are fees that the Company has agreed to accept in consideration for permitting certain tenants to terminate their leases prior to the contractual expiration date. Termination Fees are included in rental revenue.
Segments
The Company evaluates the performance of the Properties in Operation by reportable segment (see Note 13 to the Company’s financial statements for a reconciliation to net income). The following table identifies changes in reportable segments (dollars in thousands):
Property level operating income:
| | | | | | | | | | | | | |
| | | Year Ended December 31, | | | Percentage | |
| | | 2006 | | | 2005 | | | Increase (Decrease) | |
| Delaware Valley |
| – SE Pennsylvania | | $ | 129,272 | | | $ | 131,506 | | | | (1.7% | )(1) |
| – Other | | | 26,012 | | | | 24,382 | | | | 6.7% | (2) |
| Midwest |
| – Lehigh Valley | | | 66,433 | | | | 57,558 | | | | 15.4% | (3) |
| – Other | | | 73,485 | | | | 70,312 | | | | 4.5% | |
| Mid-Atlantic | | | 84,448 | | | | 73,180 | | | | 15.4% | (4) |
| Florida | | | 75,360 | | | | 64,673 | | | | 16.5% | (4) |
| United Kingdom | | | 1,002 | | | | 16,651 | | | | (94.0% | ) (5) |
| | | | | | | | | | |
| Total property level operating income (6) | | $ | 456,012 | | | $ | 438,262 | | | | 4.1 | % |
| | | | | | | | | | |
| | |
| (1) | | The decrease for the year ended December 31, 2006 versus the year ended December 31, 2005 is due to decreased termination fees accepted during 2006. This decrease was partially offset by increased occupancy and an increase in average gross investment in operating real estate. |
| |
| (2) | | The increase for the year ended December 31, 2006 versus the year ended December 31, 2005 is primarily due to an increase in average gross investment in operating real estate and increased termination fees accepted during 2006. |
| |
| (3) | | The increase for the year ended December 31, 2006 versus the year ended December 31, 2005 is primarily due to increased occupancy, an increase in average gross investment in operating real estate, increased termination fees accepted, and a $2.0 million settlement of a tenant bankruptcy received during 2006. |
| |
| (4) | | The increase for the year ended December 31, 2006 versus the year ended December 31, 2005 is primarily due to increased occupancy and an increase in average gross investment in operating real estate during 2006. |
| |
| (5) | | The decrease for the year ended December 31, 2006 versus the year ended December 31, 2005 is primarily due to the sale of 15 operating properties to a joint venture in December 2005. |
| |
| (6) | | See a reconciliation of property level operating income to net income in the Same Store comparison below. |
Same Store
Property level operating income, exclusive of Termination Fees, for the Same Store properties increased to $401.8 million for the year ended December 31, 2006 from $391.1 million for the year ended December 31, 2005, on a straight line basis (which recognizes rental revenue evenly over the life of the lease), and increased to $397.6 million for the year ended December 31, 2006 from $384.4 million for the year ended December 31, 2005 on a cash basis. These increases of 2.8% and 3.4%, respectively, are primarily due to an increase in occupancy.
Management generally considers the performance of the Same Store properties to be a useful financial performance measure because the results are directly comparable from period to period. Management further believes that the performance comparison should exclude Termination Fees since they are more event specific and are not representative of ordinary performance results. In addition, Same Store property level operating income exclusive of Termination Fees is considered by management to be a more reliable indicator of the portfolio’s baseline performance. The Same Store properties consist of the 597 properties totaling approximately 50.2 million square feet owned on January 1, 2005.
24
Set forth below is a schedule comparing the property level operating income, on a straight line basis and on a cash basis, for the Same Store properties for the years ended December 31, 2006 and 2005. Same Store property level income is a non-GAAP measure and does not represent income before property dispositions, income taxes, minority interest and equity in earnings (loss) of unconsolidated joint ventures because it does not reflect the consolidated operations of the Company. Investors should review Same Store results, along with Funds from operations (see “Liquidity and Capital Resources” section), GAAP net income and cash flow from operating activities, investing activities and financing activities when considering the Company’s operating performance. Also, set forth below is a reconciliation of Same Store property level operating income to net income (in thousands).
| | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | |
Same Store: | | | | | | | | |
| Rental revenue | | $ | 409,066 | | | $ | 402,794 | |
| | | | | | | |
| Operating expenses: | | | | | | | | |
| Rental property expense | | | 126,076 | | | | 124,831 | |
| Real estate taxes | | | 63,940 | | | | 61,720 | |
| Operating expense recovery | | | (182,795 | ) | | | (174,831 | ) |
| | | | | | | |
| Unrecovered operating expenses | | | 7,221 | | | | 11,720 | |
| | | | | | | |
| Property level operating income | | | 401,845 | | | | 391,074 | |
| Less straight line rent | | | 4,282 | | | | 6,700 | |
| | | | | | | |
| Cash basis property level operating income | | $ | 397,563 | | | $ | 384,374 | |
| | | | | | | |
| | | | | | | | | |
Reconciliation of non-GAAP financial measure: | | | | | | | | |
| Property level operating income – Same Store | | $ | 401,845 | | | $ | 391,074 | |
| Property level operating income – properties purchased or developed subsequent to January 1, 2005 | | | 47,954 | | | | 30,543 | |
| Termination fees | | | 6,213 | | | | 16,645 | |
| General and administrative expense | | | (45,991 | ) | | | (38,099 | ) |
| Depreciation and amortization expense | | | (144,692 | ) | | | (135,846 | ) |
| Other income (expense) | | | (109,993 | ) | | | (111,606 | ) |
| Gain on property dispositions | | | 17,628 | | | | 85,593 | |
| Income taxes | | | (288 | ) | | | (14,827 | ) |
| Minority interest | | | (20,411 | ) | | | (21,176 | ) |
| Equity in earnings of unconsolidated joint ventures | | | 1,432 | | | | 2,540 | |
| Discontinued operations, net of minority interest | | | 112,877 | | | | 44,510 | |
| | | | | | | |
| Net income | | $ | 266,574 | | | $ | 249,351 | |
| | | | | | | |
General and Administrative
General and administrative expenses increased to $46.0 million for the year ended December 31, 2006 from $38.1 million for the year ended December 31, 2005. This increase was primarily due to increases in salaries and increases in personnel consistent with the increase in the size of the Company. The increase in general and administrative expenses was also due to the expensing of long term incentive compensation.
Depreciation and Amortization
Depreciation and amortization increased to $144.7 million for the year ended December 31, 2006 from $135.8 million for the year ended December 31, 2005. The increase was primarily due to the increase in gross investment in operating real estate during the respective periods and particularly the increased investment in tenant improvement costs, which are amortized over a relatively shorter period than buildings.
Interest Expense
Interest expense was $119.6 million both in the year ended December 31, 2006 and in the year ended December 31, 2005. Interest expense allocated to discontinued operations for the years ended December 31, 2006 and 2005 was $4.7 million and $15.8 million, respectively. This decrease was due to the level of dispositions in 2006 versus 2005. Although there was an increase in average debt outstanding for 2006 compared to 2005 there was essentially no change in total interest expense because of the increase in capitalized interest costs which is consistent with the increased investment in Properties under Development. The average debt outstanding for the year ended December 31, 2006 was $2,263.9 million compared to $2,241.1 million for the year ended December 31, 2005. The weighted average interest rate for the years ended December 31, 2006 and 2005 was unchanged at 6.6% for both years.
25
Other
Costs directly related to the development of Properties Under Development and land being readied for development are capitalized. Capitalized development costs include interest, development-related salaries, property taxes, insurance and other directly identifiable costs incurred during the period of development. Capitalized development-related salaries and benefits historically represent approximately 1% to 2% of the cost of developed properties.
Gain on property dispositions and income taxes decreased to $17.6 million and $0.3 million, respectively, for the year ended December 31, 2006 from $85.6 million and $14.8 million, respectively, for the year ended December 31, 2005. In 2005, an $89.6 million gain and a resultant $14.5 million of tax liability was recognized on the sale of 15 United Kingdom Properties in Operation to the Kings Hill Unit Trust joint venture. In 2006, a $17.6 million gain was recognized on the sale of certain Properties in Operation and land located in Chicago to the Liberty Illinois, LP joint venture.
Income from discontinued operations increased to $112.9 million from $44.5 million for the year ended December 31, 2006 compared to the year ended December 31, 2005. The increase is due to the increase in gains realized on sales which were $112.6 million for the year ended December 31, 2006 compared to $36.6 million for the year ended December 31, 2005.
As a result of the foregoing, the Company’s net income increased to $266.6 million for the year ended December 31, 2006 from $249.4 million for the year ended December 31, 2005.
Comparison of Year Ended December 31, 2005 to Year Ended December 31, 2004
Overview
The Company’s average gross investment in operating real estate owned for the year ended December 31, 2005 increased to $3,697.6 million from $3,380.8 million for the year ended December 31, 2004. This increase in operating real estate resulted in increases in rental revenue, operating expense reimbursement, rental property expenses, real estate taxes, and depreciation and amortization expense.
Total operating revenue increased to $633.5 million for the year ended December 31, 2005 from $585.3 million for the year ended December 31, 2004. This $48.2 million increase was primarily due to the increase in investment in operating real estate. Contributing to this increase was an increase in Termination Fees, which totaled $16.6 million for the year ended December 31, 2005 as compared to $10.9 million for the year ended December 31, 2004. Termination Fees are included in rental revenue.
Segments
The Company evaluates the performance of the Properties in Operation by reportable segment (see Note 13 to the Company’s financial statements for a reconciliation to net income). The following table identifies changes in reportable segments (dollars in thousands):
Property level operating income:
| | | | | | | | | | | | | |
| | | Year Ended December 31, | | | Percentage | |
| | | 2005 | | | 2004 | | | Increase (Decrease) | |
| Delaware Valley |
| – SE Pennsylvania | | $ | 131,506 | | | $ | 125,712 | | | | 4.6% | |
| – Other | | | 24,382 | | | | 21,632 | | | | 12.7% | (1) |
| Midwest |
| – Lehigh Valley | | | 57,558 | | | | 49,644 | | | | 15.9% | (1) |
| – Other | | | 70,312 | | | | 65,483 | | | | 7.4% | (2) |
| Mid-Atlantic | | | 73,180 | | | | 72,680 | | | | 0.7% | |
| Florida | | | 64,673 | | | | 59,523 | | | | 8.7% | (1) |
| United Kingdom | | | 16,651 | | | | 16,566 | | | | 0.5% | |
| | | | | | | | | | |
| Total property level operating income (3) | | $ | 438,262 | | | $ | 411,240 | | | | 6.6% | |
| | | | | | | | | | |
| | |
| (1) | | The increase for the year ended December 31, 2005 versus the year ended December 31, 2004 is primarily due to an increase in average gross investment in operating real estate during 2005. |
| |
| (2) | | The increase for the year ended December 31, 2005 versus the year ended December 31, 2004 is primarily due to increased occupancy and an increase in average gross investment in operating real estate during 2005. |
| |
| (3) | | See a reconciliation of property level operating income to net income in the Same Store comparison below. |
26
Same Store
Property level operating income, exclusive of Termination Fees, for the “Prior Year Same Store” (as defined below) properties decreased to $397.7 million for the year ended December 31, 2005 from $402.6 million for the year ended December 31, 2004, on a straight line basis and decreased to $391.7 million for the year ended December 31, 2005 from $392.6 million for the year ended December 31, 2004 on a cash basis. These decreases of 1.2% and 0.3%, respectively, were primarily due to a decrease in the occupancy of the office properties, which is the higher rent paying portion of the portfolio.
Management generally considers the performance of the Prior Year Same Store properties to be a useful financial performance measure because the results are directly comparable from period to period. Management further believes that the performance comparison should exclude Termination Fees since they are more event specific and are not representative of ordinary performance results. In addition, Prior Year Same Store property level operating income exclusive of Termination Fees is considered by management to be a more reliable indicator of the portfolio’s baseline performance. The Prior Year Same Store properties consist of the 611 properties totaling approximately 50.0 million square feet owned on January 1, 2004.
Set forth below is a schedule comparing the property level operating income, on a straight line basis and on a cash basis, for the Prior Year Same Store properties for the years ended December 31, 2005 and 2004. Prior Year Same Store property level income is a non-GAAP measure and does not represent income before property dispositions, income taxes, minority interest, and equity in earnings (loss) of unconsolidated real estate ventures because it does not reflect the consolidated operations of the Company. Investors should review Prior Year Same Store results, along with Funds from operations (see Liquidity and Capital Resources section), GAAP net income and cash flow from operating activities, investing activities and financing activities when considering the Company’s operating performance. Also, set forth below is a reconciliation of Prior Year Same Store property level operating income to net income (in thousands).
| | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2005 | | | 2004 | |
Prior Year Same Store: | | | | | | | | |
| Rental revenue | | $ | 411,465 | | | $ | 416,292 | |
| | | | | | | |
| Operating expenses: | | | | | | | | |
| Rental property expense | | | 130,713 | | | | 122,963 | |
| Real estate taxes | | | 62,000 | | | | 60,826 | |
| Operating expense recovery | | | (178,953 | ) | | | (170,126 | ) |
| | | | | | | |
| Unrecovered operating expenses | | | 13,760 | | | | 13,663 | |
| | | | | | | |
| Property level operating income | | | 397,705 | | | | 402,629 | |
| Less straight line rent | | | 6,046 | | | | 9,986 | |
| | | | | | | |
| Cash basis property level operating income | | $ | 391,659 | | | $ | 392,643 | |
| | | | | | | |
| | | | | | | | | |
Reconciliation of non-GAAP financial measure: | | | | | | | | |
| Property level operating income – prior year Same Store | | $ | 397,705 | | | $ | 402,629 | |
| Property level operating income – properties purchased or developed subsequent to January 1, 2004 | | | 23,912 | | | | (2,266 | ) |
| Termination fees | | | 16,645 | | | | 10,877 | |
| General and administrative expense | | | (38,099 | ) | | | (33,724 | ) |
| Depreciation and amortization expense | | | (135,846 | ) | | | (119,934 | ) |
| Other income (expense) | | | (111,606 | ) | | | (100,761 | ) |
| Gain on property dispositions | | | 85,593 | | | | 496 | |
| Income taxes | | | (14,827 | ) | | | (1,820 | ) |
| Minority interest | | | (21,176 | ) | | | (17,134 | ) |
| Equity in (loss) earnings of unconsolidated joint ventures | | | 2,540 | | | | (775 | ) |
| Discontinued operations, net of minority interest | | | 44,510 | | | | 23,855 | |
| | | | | | | |
| Net income | | $ | 249,351 | | | $ | 161,443 | |
| | | | | | | |
27
General and Administrative
General and administrative expenses increased to $38.1 million for the year ended December 31, 2005 from $33.7 million for the year ended December 31, 2004. This increase was primarily due to increases in salaries and increases in personnel consistent with the increase in the size of the Company. The increase in general and administrative expenses was also due to the expensing of stock options and related long term incentive compensation and increased costs relating to compliance with the requirements of the Sarbanes-Oxley legislation and related regulatory requirements.
Depreciation and Amortization
Depreciation and amortization increased to $135.8 million for the year ended December 31, 2005 from $119.9 million for the year ended December 31, 2004. The increase is primarily due to the increase in gross investment in operating real estate during the respective periods and particularly the increased investment in tenant improvement costs, which are amortized over a relatively shorter period than buildings.
Interest Expense
Interest expense increased to $119.6 million for the year ended December 31, 2005 from $107.0 million for the year ended December 31, 2004. This increase was due to an increase in the average debt outstanding for the respective periods, which was $2,241.1 million in 2005 and $1,990.3 million in 2004. The effect of the increases in the average debt outstanding was offset by decreases in the weighted average interest rates for the periods, to 6.58% in 2005 from 6.70% in 2004.
Other
Costs directly related to the development of Properties Under Development and land being readied for development are capitalized. Capitalized development costs include interest, development-related salaries, property taxes, insurance and other directly identifiable costs during the period of development. Capitalized interest for the year ended December 31, 2005 was $17.7 million as compared to $13.2 million for the year ended December 31, 2004. Capitalized development-related salaries and benefits historically represent approximately 1% to 2% of the cost of developed properties.
Gain on property dispositions and income taxes increased to $85.6 million and $14.8 million, respectively for the year ended December 31, 2005 from $0.5 million and $1.8 million, respectively for the year ended December 31, 2004. These increases are due to the $89.6 million gain recognized on the sale of 15 United Kingdom Properties in Operation to the Kings Hill Unit Trust joint venture and the resultant $14.5 million tax on this gain.
Income from discontinued operations increased to $44.5 million from $23.9 million for the year ended December 31, 2005 compared to the year ended December 31, 2004. The increase is due to the increase in the gains realized on property dispositions, which were primarily due to the increase in dispositions activity for 2005 compared to 2004. For the year ended December 31, 2005, there was $36.6 million in net gains on $200.9 million in dispositions and for the year ended December 31, 2004, there was $59.6 million in dispositions resulting in $11.6 million in net gains.
As a result of the foregoing, the Company’s net income increased to $249.4 million for the year ended December 31, 2005 from $161.4 million for the year ended December 31, 2004.
Liquidity and Capital Resources
As of December 31, 2006, the Company had cash and cash equivalents of $109.4 million, including $55.7 million in restricted cash.
Net cash flow provided by operating activities decreased to $344.9 million for the year ended December 31, 2006 from $360.7 million for the year ended December 31, 2005. This $15.8 million decrease was primarily due to an increase in restricted cash partially offset by an increase in net income. The increase in restricted cash is due to the increase in proceeds from the sale of land in the United Kingdom. These proceeds are restricted for the payment of infrastructure costs. Net cash flow provided by operations is the primary source of liquidity to fund distributions to shareholders and for the recurring capital expenditures and leasing transaction costs for the Company’s Properties in Operation.
Net cash used in investing activities increased to $355.3 million for the year ended December 31, 2006 from $286.6 million for the year ended December 31, 2005. This $68.7 million increase was primarily due to an increased investment in properties and an increased investment in development in progress partially offset by an increase in net proceeds from the disposition of properties and land.
28
Net cash used in financing activities decreased to $0.3 million for the year ended December 31, 2006 compared to $39.5 million for the year ended December 31, 2005. This change was due to the change in debt, and partially offset by a decrease in net proceeds from the issuance of preferred units. Net cash provided by or used in financing activities includes proceeds from the issuance of equity and debt, net of debt repayments and shareholder distributions. Net cash provided by financing activities is a source of capital utilized by the Company to fund investment activities.
The Company funds its development and acquisitions with long-term capital sources including proceeds from the disposition of properties. For the year ended December 31, 2006, a significant portion of these activities were funded through a $600 million Credit Facility (the “$600 million Credit Facility”). The interest rate on borrowings under the $600 million Credit Facility fluctuates based upon ratings from Moody’s Investors Service, Inc. (“Moody’s”), Standard and Poor’s Ratings Group (“S&P”) and Fitch, Inc. (“Fitch”). The current ratings for the Company’s senior unsecured debt are Baa2, BBB and BBB+ from Moody’s, S&P and Fitch, respectively. At these ratings, the interest rate for borrowings under the $600 million Credit Facility is 65 basis points over LIBOR. The $600 million Credit Facility contains an accordion feature whereby the Company may borrow an additional $200 million. The $600 million Credit Facility expires in January 2010, and has a one-year extension option.
The Company uses debt financing to lower its overall cost of capital in an attempt to increase the return to shareholders. The Company staggers its debt maturities and maintains debt levels it considers to be prudent. In determining its debt levels, the Company considers various financial measures including the debt to gross assets ratio and the fixed charge coverage ratio. As of December 31, 2006 the Company’s debt to gross assets ratio was 41.8%, and for the year ended December 31, 2006 the fixed charge coverage ratio was 2.5x. Debt to gross assets equals total long-term debt, borrowings under the $600 million Credit Facility, and borrowings under the Liberty/Commerz 1701 JFK Boulevard, LP financing arrangement divided by total assets plus accumulated depreciation. The fixed charge coverage ratio equals income from continuing operations before property dispositions and minority interest, including operating activity from discontinued operations, plus interest expense and depreciation and amortization, divided by interest expense, including capitalized interest, plus distributions on preferred units.
As of December 31, 2006, $186.0 million in mortgage loans and $1,955.0 million in unsecured notes were outstanding with a weighted average interest rate of 6.63%. The interest rates on these mortgage loans and unsecured notes are fixed and range from 4.6% to 8.8%. The weighted average remaining term for these mortgage loans and unsecured notes is 6.0 years.
In 2007, $1.6 million in mortgage loans with various interest rates and $100.0 million in unsecured notes will mature. The Company anticipates that it will refinance or retire these borrowings through its available sources of capital.
The Company’s contractual obligations, as of December 31, 2006, are as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | | |
| | | Payments Due By Period | |
| | | | | | | Less than 1 | | | | | | | | | | | More than | |
| Contractual Obligations | | Total | | | year | | | 1-3 years | | | 3-5 years | | | 5 years | |
| Long-term debt (1) | | $ | 3,200,328 | | | $ | 264,685 | | | $ | 788,184 | | | $ | 741,153 | | | $ | 1,406,306 | |
| Capital lease obligations | | | 7,373 | | | | 1,684 | | | | 661 | | | | 362 | | | | 4,666 | |
| Operating lease obligations | | | 13,102 | | | | 716 | | | | 929 | | | | 812 | | | | 10,645 | |
| Share of debt of unconsolidated joint ventures (1) | | | 101,602 | | | | 3,762 | | | | 34,515 | | | | 43,858 | | | | 19,467 | |
| Property development commitments (2) | | | 412,987 | | | | 290,234 | | | | 122,753 | | | | — | | | | — | |
| Share of property development commitments of unconsolidated joint ventures | | | 34,296 | | | | 24,517 | | | | 9,779 | | | | — | | | | — | |
| Joint venture capital commitments | | | 1,012 | | | | 1,012 | | | | — | | | | — | | | | — | |
| Letter of credit | | | 1,583 | | | | 1,583 | | | | — | | | | — | | | | — | |
| Purchase obligations (3) | | | 132,430 | | | | 112,330 | | | | 20,100 | | | | — | | | | — | |
| Master lease obligation (4) | | | 5,532 | | | | 5,532 | | | | — | | | | — | | | | — | |
| | | | | | | | | | | | | | | | |
| Total | | $ | 3,910,245 | | | $ | 706,055 | | | $ | 976,921 | | | $ | 786,185 | | | $ | 1,441,084 | |
| | | | | | | | | | | | | | | | |
| | |
| (1) | | Includes principal and interest payments. Interest payments assume current credit facility borrowings and interest rates remain at the December 31, 2006 level until maturity. |
| |
| (2) | | The Comcast Center commitment is included at the current projected Total Investment of $495 million. |
| |
| (3) | | Purchase obligations include obligations to acquire property and land. |
| |
| (4) | | Includes Comcast Center net operating income support agreement and a master lease arrangement in the United Kingdom. |
29
General
The Company believes that its existing sources of capital will provide sufficient funds to finance its continued development and acquisition activities. The Company’s existing sources of capital include the public debt and equity markets, proceeds from property dispositions, equity capital from joint venture partners and net cash provided from operating activities. Additionally, the Company expects to incur variable rate debt, including borrowings under the $600 million Credit Facility, from time to time.
In February 2005, the Company issued a $300 million 5.125% senior unsecured note due 2015. The net proceeds from such issuance were $296.4 million. The net proceeds were used to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.
In June 2005, the Company redeemed for $20 million its outstanding 9.125% Series C Cumulative Redeemable Preferred Units and issued $20 million of 7.0% Series E Cumulative Redeemable Preferred Units.
During 2005, the Company raised $50 million through the placement of 6.65% Series F Cumulative Redeemable Preferred Units. The net proceeds from these offerings were used to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.
In December 2006, the Company satisfied a $100 million 6.95% medium term note and issued a $300 million 5.50% senior unsecured note due 2016. The net proceeds of the $300 million offering were $295.4 million and were used to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.
In December 2006, the Company raised $27 million through the placement of 6.70% Series G Cumulative Redeemable Preferred Units. The net proceeds from this offering were used to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.
In September 2006, the quarterly Common Share dividend was increased to $0.62 per share from $0.615 per share. The Company’s annual Common Share dividend paid was $2.465 per share, $2.445 per share, and $2.425 per share in 2006, 2005, and 2004, respectively. In 2006, the Company’s dividend payout ratio was approximately 79.2% of Funds from operations (as defined below).
The Company has an effective S-3 shelf registration statement on file with the SEC (the “Shelf Registration Statement”). As of February 23, 2007, pursuant to the Shelf Registration Statement, the Trust had the capacity to issue up to $586.1 million in equity securities and the Operating Partnership had the capacity to issue up to $508.4 million in debt securities.
Off-Balance Sheet Arrangements
As of December 31, 2006, the Company had investments in unconsolidated joint ventures totaling $47.2 million.
Calculation of Funds from Operations
The National Association of Real Estate Investment Trusts (“NAREIT”) has issued a standard definition for Funds from operations (as defined below). The SEC has agreed to the disclosure of this non-GAAP financial measure on a per share basis in its Release No. 34-47226, Conditions for Use of Non-GAAP Financial Measures. The Company believes that the calculation of Funds from operations is helpful to investors and management as it is a measure of the Company’s operating performance that excludes depreciation and amortization and gains and losses from property dispositions. As a result, year over year comparison of Funds from operations reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses, and interest costs, providing perspective not immediately apparent from net income. In addition, management believes that Funds from operations provides useful information to the investment community about the Company’s financial performance when compared to other REITs since Funds from operations is generally recognized as the standard for reporting the operating performance of a REIT. Funds from operations available to common shareholders is defined by NAREIT as net income (computed in accordance with generally accepted accounting principles (“GAAP”)), excluding gains (or losses) from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Funds from operations available to common shareholders does not represent net income or cash flows from operations as defined by GAAP and does not necessarily indicate that cash flows will be sufficient to fund cash needs. It should not be considered as an alternative to net income as an indicator of the Company’s operating performance or to cash flows as a measure of liquidity. Funds from operations available to common shareholders also does not represent cash flows generated from operating, investing or financing activities as defined by GAAP.
30
Funds from operations (“FFO”) available to common shareholders for the years ended December 31, 2006, 2005, and 2004 are as follows (in thousands, except per share amounts):
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
| | | | | | | | | | |
Reconciliation of net income to FFO – basic | | | | | | | | | | | | |
Net income | | $ | 266,574 | | | $ | 249,351 | | | $ | 161,443 | |
| | | | | | | | | | |
Basic — income available to common shareholders | | | 266,574 | | | | 249,351 | | | | 161,443 | |
Basic – income available to common shareholders per weighted average share | | $ | 2.98 | | | $ | 2.87 | | | $ | 1.91 | |
| | | | | | | | | | | | | |
Adjustments: | | | | | | | | | | | | |
| Depreciation and amortization of unconsolidated joint ventures | | | 2,871 | | | | 1,316 | | | | 2,566 | |
| Depreciation and amortization | | | 149,606 | | | | 147,669 | | | | 133,682 | |
| Gain on property dispositions | | | (136,036 | ) | | | (114,381 | ) | | | (13,502 | ) |
| Minority interest share in addback for depreciation and amortization and gain on property dispositions | | | (877 | ) | | | (1,363 | ) | | | (5,093 | ) |
| | | | | | | | | | |
Funds from operations available to common shareholders — basic | | $ | 282,138 | | | $ | 282,592 | | | $ | 279,096 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
Basic Funds from operations available to common shareholders per weighted average share | | $ | 3.16 | | | $ | 3.25 | | | $ | 3.30 | |
| | | | | | | | | | | | | |
Reconciliation of net income to FFO – diluted Net income | | $ | 266,574 | | | $ | 249,351 | | | $ | 161,443 | |
| | | | | | | | | | |
Diluted – income available to common shareholders | | | 266,574 | | | | 249,351 | | | | 161,443 | |
Diluted – income available to common shareholders per weighted average share | | $ | 2.95 | | | $ | 2.82 | | | $ | 1.88 | |
| | | | | | | | | | | | | |
Adjustments: | | | | | | | | | | | | |
| Depreciation and amortization of unconsolidated joint ventures | | | 2,871 | | | | 1,316 | | | | 2,566 | |
| Depreciation and amortization | | | 149,606 | | | | 147,669 | | | | 133,682 | |
| Gain on property dispositions | | | (136,036 | ) | | | (114,381 | ) | | | (13,502 | ) |
| Minority interest less preferred share distributions | | | 11,786 | | | | 10,018 | | | | 6,955 | |
| | | | | | | | | | |
Funds from operations available to common shareholders – diluted | | $ | 294,801 | | | $ | 293,973 | | | $ | 291,144 | |
| | | | | | | | | | |
Diluted Funds from operations available to common shareholders per weighted average share | | $ | 3.12 | | | $ | 3.20 | | | $ | 3.25 | |
| | | | | | | | | | | | | |
Reconciliation of weighted average shares: | | | | | | | | | | | | |
| Weighted average common shares – all basic calculations | | | 89,313 | | | | 86,986 | | | | 84,534 | |
| Dilutive shares for long term compensation plans | | | 1,179 | | | | 1,390 | | | | 1,490 | |
| | | | | | | | | | |
| Diluted shares for net income calculations | | | 90,492 | | | | 88,376 | | | | 86,024 | |
| Weighted average common units | | | 3,895 | | | | 3,555 | | | | 3,676 | |
| | | | | | | | | | |
| Diluted shares for Funds from operations calculations | | | 94,387 | | | | 91,931 | | | | 89,700 | |
| | | | | | | | | | |
Inflation
Inflation has remained relatively low during the last three years, and as a result, it has not had a significant impact on the Company during this period. The $600 million Credit Facility and the financing related to the Comcast Center, (see Note 6 to the Company’s financial statements) bear interest at variable rates; therefore, the amount of interest payable under the $600 million Credit Facility and the financing related to the Comcast Center is influenced by changes in short-term interest rates, which tend to be sensitive to inflation. To the extent an increase in inflation would result in increased operating costs, such as in insurance, real estate taxes and utilities, substantially all of the tenants’ leases require the tenants to absorb these costs as part of their rental obligations. In addition, inflation also may have the effect of increasing market rental rates.
31
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The following discussion about the Company’s risk management includes forward-looking statements that involve risks and uncertainties. Actual results could differ materially from the results discussed in the forward-looking statements.
The Company’s primary market risk exposure is to changes in interest rates. The Company is exposed to market risk related to its $600 million Credit Facility and certain other indebtedness as discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources.” The interest on the $600 million Credit Facility and certain other indebtedness is subject to fluctuations in the market.
The Company also uses long-term and medium-term debt as a source of capital. These debt instruments are typically issued at fixed interest rates. When these debt instruments mature, the Company typically refinances such debt at then-existing market interest rates which may be more or less than the interest rates on the maturing debt. In addition, the Company may attempt to reduce interest rate risk associated with a forecasted issuance of new debt. In order to reduce interest rate risk associated with these transactions, the Company occasionally enters into interest rate protection agreements.
If the interest rates for variable rate debt were 100 basis points higher or lower during 2006, the Company’s interest expense would have increased or decreased by $3.2 million. If the interest rate for the fixed rate debt maturing in 2007 was 100 basis points higher or lower than its current rate of 7.3%, the Company’s interest expense would have increased or decreased by $500,000.
The sensitivity analysis above assumes no changes in the Company’s financial structure. It also does not consider future fluctuations in interest rates or the specific actions that might be taken by management to mitigate the impact of such fluctuations.
The Company is also exposed to currency risk on its net investment in the United Kingdom. The Company does not believe that this currency risk exposure is material to its financial statements.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The dual presentation of financial statements for the Company is required by the SEC. The Company is comprised of two SEC registrants: Liberty Property Trust and Liberty Property Limited Partnership. Accordingly, financial statements are required for each registrant. The financial information contained within the two sets of financial statements is essentially the same.
32
Management’s Annual Report on Internal Control Over Financial Reporting
To the Shareholders of Liberty Property Trust:
The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a – 15 (f) and 15d – 15(f). The Company’s internal control system was designed to provide reasonable assurance to the Company’s management and Board of Trustees regarding the preparation and fair presentation of published financial statements.
Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2006. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commissions (COSO) inInternal Control – Integrated Framework. Based on our assessment we believe that, as of December 31, 2006, the Company’s internal control over financial reporting is effective based on those criteria.
Management’s assertion regarding its assessment of internal control over financial reporting has been audited by Ernst & Young LLP, an independent registered public accounting firm, whose reports appear on the following pages.
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.
February 23, 2007
33
Report of Independent Registered Public Accounting Firm
The Board of Trustees and Shareholders of Liberty Property Trust:
We have audited management’s assessment, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting, that Liberty Property Trust (the “Trust”) maintained effective internal control over financial reporting as of December 31, 2006, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). The Trust’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express an opinion on management’s assessment and an opinion on the effectiveness of the Trust’s internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating management’s assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
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 (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) 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 (3) 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.
In our opinion, management’s assessment that Liberty Property Trust maintained effective internal control over financial reporting as of December 31, 2006, is fairly stated, in all material respects, based on the COSO criteria. Also, in our opinion, the Trust maintained, in all material respects, effective internal control over financial reporting as of December 31, 2006, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Liberty Property Trust as of December 31, 2006 and 2005, and the related consolidated statements of operations, shareholders’ equity, and cash flows for the each of the three years in the period ended December 31, 2006 of the Trust and our report dated February 23, 2007 expressed an unqualified opinion thereon.
Philadelphia, Pennsylvania
February 23, 2007
34
Report of Independent Registered Public Accounting Firm
The Board of Trustees and Shareholders of Liberty Property Trust:
We have audited the accompanying consolidated balance sheets of Liberty Property Trust (the “Trust”) as of December 31, 2006 and 2005, and the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2006. Our audits also included the financial statement schedule listed in the Index at Item 15. These financial statements and schedule are the responsibility of the Trust’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Liberty Property Trust at December 31, 2006 and 2005, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2006, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of Liberty Property Trust’s internal control over financial reporting as of December 31, 2006, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 23, 2007 expressed an unqualified opinion thereon.
Philadelphia, Pennsylvania
February 23, 2007
35
CONSOLIDATED BALANCE SHEETS OF LIBERTY PROPERTY TRUST
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
| | | | | | | | | |
| | | December 31, | |
| | | 2006 | | | 2005 | |
ASSETS | | | | | | | | |
| Real estate: | | | | | | | | |
| Land and land improvements | | $ | 678,075 | | | $ | 620,355 | |
| Buildings and improvements | | | 3,814,437 | | | | 3,664,036 | |
| Less accumulated depreciation | | | (806,309 | ) | | | (732,439 | ) |
| | | | | | | |
| Operating real estate | | | 3,686,203 | | | | 3,551,952 | |
| | | | | | | | | |
| Development in progress | | | 538,303 | | | | 324,924 | |
| Land held for development | | | 195,332 | | | | 158,653 | |
| | | | | | | |
| Net real estate | | | 4,419,838 | | | | 4,035,529 | |
| | | | | | | | | |
| Cash and cash equivalents | | | 53,737 | | | | 61,629 | |
| Restricted cash | | | 55,671 | | | | 29,085 | |
| Accounts receivable | | | 23,809 | | | | 14,761 | |
| Deferred rent receivable | | | 71,894 | | | | 72,818 | |
| Deferred financing and leasing costs, net | | | 129,745 | | | | 122,994 | |
| Investments in unconsolidated joint ventures | | | 47,196 | | | | 33,522 | |
| Assets held for sale | | | 40,715 | | | | 73,211 | |
| Prepaid expenses and other assets | | | 68,306 | | | | 56,773 | |
| | | | | | | |
| Total assets | | $ | 4,910,911 | | | $ | 4,500,322 | |
| | | | | | | |
| | | | | | | | | |
LIABILITIES | | | | | | | | |
| Mortgage loans | | $ | 185,978 | | | $ | 238,728 | |
| Unsecured notes | | | 1,955,000 | | | | 1,755,000 | |
| Credit facility | | | 246,960 | | | | 255,450 | |
| Accounts payable | | | 40,633 | | | | 32,919 | |
| Accrued interest | | | 36,297 | | | | 34,892 | |
| Dividends and distributions payable | | | 58,961 | | | | 56,490 | |
| Other liabilities | | | 217,751 | | | | 164,528 | |
| | | | | | | |
| Total liabilities | | | 2,741,580 | | | | 2,538,007 | |
| | | | | | | | | |
| Minority interest | | | 297,727 | | | | 253,133 | |
| | | | | | | | | |
SHAREHOLDERS’ EQUITY | | | | | | | | |
| Common shares of beneficial interest, $.001 par value, 187,987,000 shares authorized, 90,972,979 (includes 59,100 in treasury) and 88,415,764 (includes 59,100 in treasury) shares issued and outstanding as of December 31, 2006 and 2005, respectively | | | 91 | | | | 88 | |
| Additional paid-in capital | | | 1,906,403 | | | | 1,799,068 | |
| Accumulated other comprehensive income | | | 20,323 | | | | 9,906 | |
| Distributions in excess of net income | | | (53,886 | ) | | | (98,553 | ) |
| Common shares held in treasury, at cost, 59,100 shares as of December 31, 2006 and 2005 | | | (1,327 | ) | | | (1,327 | ) |
| | | | | | | |
| Total shareholders’ equity | | | 1,871,604 | | | | 1,709,182 | |
| | | | | | | |
| Total liabilities and shareholders’ equity | | $ | 4,910,911 | | | $ | 4,500,322 | |
| | | | | | | |
See accompanying notes.
36
CONSOLIDATED STATEMENTS OF OPERATIONS OF LIBERTY PROPERTY TRUST
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
OPERATING REVENUE | | | | | | | | | | | | |
| Rental | | $ | 464,714 | | | $ | 451,608 | | | $ | 421,712 | |
| Operating expense reimbursement | | | 202,005 | | | | 181,886 | | | | 163,572 | |
| | | | | | | | | | |
| Total operating revenue | | | 666,719 | | | | 633,494 | | | | 585,284 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
OPERATING EXPENSE | | | | | | | | | | | | |
| Rental property | | | 139,055 | | | | 130,353 | | | | 115,143 | |
| Real estate taxes | | | 71,652 | | | | 64,879 | | | | 58,901 | |
| General and administrative | | | 45,991 | | | | 38,099 | | | | 33,724 | |
| Depreciation and amortization | | | 144,692 | | | | 135,846 | | | | 119,934 | |
| | | | | | | | | | |
| Total operating expenses | | | 401,390 | | | | 369,177 | | | | 327,702 | |
| | | | | | | | | | |
Operating income | | | 265,329 | | | | 264,317 | | | | 257,582 | |
| | | | | | | | | | | | | |
OTHER INCOME (EXPENSE) | | | | | | | | | | | | |
| Interest and other income | | | 9,591 | | | | 8,008 | | | | 6,266 | |
| Interest expense | | | (119,584 | ) | | | (119,614 | ) | | | (107,027 | ) |
| | | | | | | | | | |
| Total other income (expense) | | | (109,993 | ) | | | (111,606 | ) | | | (100,761 | ) |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Income before property dispositions, income taxes, minority interest and equity in earnings (loss) of unconsolidated joint ventures | | | 155,336 | | | | 152,711 | | | | 156,821 | |
| Gain on property dispositions | | | 17,628 | | | | 85,593 | | | | 496 | |
| Income taxes | | | (288 | ) | | | (14,827 | ) | | | (1,820 | ) |
| Minority interest | | | (20,411 | ) | | | (21,176 | ) | | | (17,134 | ) |
| Equity in earnings (loss) of unconsolidated joint ventures | | | 1,432 | | | | 2,540 | | | | (775 | ) |
| | | | | | | | | | |
Income from continuing operations | | | 153,697 | | | | 204,841 | | | | 137,588 | |
| | | | | | | | | | | | | |
| Discontinued operations, net of minority interest (including net gain on property dispositions of $112,620, $36,617, and $11,603 for the years ended December 31, 2006, 2005 and 2004, respectively) | | | 112,877 | | | | 44,510 | | | | 23,855 | |
| | | | | | | | | | |
Net income | | $ | 266,574 | | | $ | 249,351 | | | $ | 161,443 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
Earnings per share | | | | | | | | | | | | |
| Basic: | | | | | | | | | | | | |
| Income from continuing operations | | $ | 1.72 | | | $ | 2.36 | | | $ | 1.63 | |
| Income from discontinued operations | | | 1.26 | | | | 0.51 | | | | 0.28 | |
| | | | | | | | | | |
| Income per common share – basic | | $ | 2.98 | | | $ | 2.87 | | | $ | 1.91 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Diluted: | | | | | | | | | | | | |
| Income from continuing operations | | $ | 1.70 | | | $ | 2.32 | | | $ | 1.60 | |
| Income from discontinued operations | | | 1.25 | | | | 0.50 | | | | 0.28 | |
| | | | | | | | | | |
| Income per common share – diluted | | $ | 2.95 | | | $ | 2.82 | | | $ | 1.88 | |
| | | | | | | | | | |
| Weighted average number of common shares outstanding Basic | | | 89,313 | | | | 86,986 | | | | 84,534 | |
| Diluted | | | 90,492 | | | | 88,376 | | | | 86,024 | |
See accompanying notes.
37
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY OF LIBERTY PROPERTY TRUST
(IN THOUSANDS)
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Common | | | | | | | | | | | | | | | Common | | | | |
| | | Shares of | | | Additional | | | Accumulated | | | Distributions | | | Shares | | | Total | |
| | | Beneficial | | | Paid-In | | | Other | | | in Excess of | | | Held | | | Shareholders’ | |
| | | Interest | | | Capital | | | Comprehensive Income | | | Net Income | | | in Treasury | | | Equity | |
| Balance at January 1, 2004 | | $ | 83 | | | $ | 1,619,949 | | | $ | 14,710 | | | $ | (88,518 | ) | | $ | (1,327 | ) | | $ | 1,544,897 | |
| Net proceeds from the issuance of common shares | | | 3 | | | | 85,168 | | | | — | | | | — | | | | — | | | | 85,171 | |
| Net income | | | — | | | | — | | | | — | | | | 161,443 | | | | — | | | | 161,443 | |
| Distributions on common shares | | | — | | | | — | | | | — | | | | (206,443 | ) | | | — | | | | (206,443 | ) |
| Noncash compensation | | | — | | | | 2,388 | | | | — | | | | — | | | | — | | | | 2,388 | |
| Minority interest reclassification | | | — | | | | (1,592 | ) | | | — | | | | — | | | | — | | | | (1,592 | ) |
| Foreign currency translation adjustment | | | — | | | | — | | | | 10,395 | | | | — | | | | — | | | | 10,395 | |
| | | | | | | | | | | | | | | | | | | |
| |
| Balance at December 31, 2004 | | | 86 | | | | 1,705,913 | | | | 25,105 | | | | (133,518 | ) | | | (1,327 | ) | | | 1,596,259 | |
| Net proceeds from the issuance of common shares | | | 2 | | | | 86,460 | | | | — | | | | — | | | | — | | | | 86,462 | |
| Net income | | | — | | | | — | | | | — | | | | 249,351 | | | | — | | | | 249,351 | |
| Distributions on common shares | | | — | | | | — | | | | — | | | | (214,386 | ) | | | — | | | | (214,386 | ) |
| Noncash compensation | | | — | | | | 5,032 | | | | — | | | | — | | | | — | | | | 5,032 | |
| Minority interest reclassification | | | — | | | | 1,663 | | | | — | | | | — | | | | — | | | | 1,663 | |
| Foreign currency translation adjustment | | | — | | | | — | | | | (15,199 | ) | | | — | | | | — | | | | (15,199 | ) |
| | | | | | | | | | | | | | | | | | | |
| |
| Balance at December 31, 2005 | | | 88 | | | | 1,799,068 | | | | 9,906 | | | | (98,553 | ) | | | (1,327 | ) | | | 1,709,182 | |
| Net proceeds from the issuance of common shares | | | 3 | | | | 87,040 | | | | — | | | | — | | | | — | | | | 87,043 | |
| Net income | | | — | | | | — | | | | — | | | | 266,574 | | | | — | | | | 266,574 | |
| Distributions on common shares | | | — | | | | — | | | | — | | | | (221,907 | ) | | | — | | | | (221,907 | ) |
| Noncash compensation | | | — | | | | 6,212 | | | | — | | | | — | | | | — | | | | 6,212 | |
| Minority interest reclassification | | | — | | | | 14,083 | | | | — | | | | — | | | | — | | | | 14,083 | |
| Foreign currency translation adjustment | | | — | | | | — | | | | 10,417 | | | | — | | | | — | | | | 10,417 | |
| | | | | | | | | | | | | | | | | | | |
| Balance at December 31, 2006 | | $ | 91 | | | $ | 1,906,403 | | | $ | 20,323 | | | $ | (53,886 | ) | | $ | (1,327 | ) | | $ | 1,871,604 | |
| | | | | | | | | | | | | | | | | | | |
See accompanying notes.
38
CONSOLIDATED STATEMENTS OF CASH FLOWS OF LIBERTY PROPERTY TRUST
(IN THOUSANDS)
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
OPERATING ACTIVITIES | | | | | | | | | | | | |
| Net income | | $ | 266,574 | | | $ | 249,351 | | | $ | 161,443 | |
| Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | | | | | |
| Depreciation and amortization | | | 151,966 | | | | 150,722 | | | | 136,700 | |
| Amortization of deferred financing costs | | | 4,244 | | | | 4,758 | | | | 4,315 | |
| Equity in (earnings) loss of unconsolidated joint ventures | | | (1,432 | ) | | | (2,540 | ) | | | 775 | |
| Distributions from unconsolidated joint ventures | | | 5,692 | | | | 4,651 | | | | 682 | |
| Minority interest in net income | | | 25,469 | | | | 22,965 | | | | 18,167 | |
| Gain on property dispositions | | | (130,248 | ) | | | (122,210 | ) | | | (12,099 | ) |
| Noncash compensation | | | 6,212 | | | | 5,032 | | | | 2,388 | |
| Changes in operating assets and liabilities: | | | | | | | | | | | | |
| Restricted cash | | | (21,692 | ) | | | 3,849 | | | | (19,334 | ) |
| Accounts receivable | | | (6,879 | ) | | | 1,804 | | | | (8,449 | ) |
| Deferred rent receivable | | | 924 | | | | (6,290 | ) | | | (8,513 | ) |
| Prepaid expenses and other assets | | | (14,394 | ) | | | (12,488 | ) | | | (12,046 | ) |
| Accounts payable | | | 7,648 | | | | 8,894 | | | | 8,859 | |
| Accrued interest | | | 1,405 | | | | (102 | ) | | | 2,166 | |
| Other liabilities | | | 49,412 | | | | 52,353 | | | | 18,282 | |
| | | | | | | | | | |
| Net cash provided by operating activities | | | 344,901 | | | | 360,749 | | | | 293,336 | |
| | | | | | | | | | |
| |
INVESTING ACTIVITIES | | | | | | | | | | | | |
| Investment in properties | | | (372,610 | ) | | | (324,340 | ) | | | (253,017 | ) |
| Investments in unconsolidated joint ventures | | | (6,239 | ) | | | (13,790 | ) | | | (6,198 | ) |
| Net proceeds from disposition of properties/land | | | 492,548 | | | | 415,144 | | | | 54,140 | |
| Investment in development in progress | | | (359,959 | ) | | | (235,078 | ) | | | (105,208 | ) |
| Investment in land held for development | | | (79,976 | ) | | | (91,436 | ) | | | (34,132 | ) |
| Increase in deferred leasing costs | | | (29,034 | ) | | | (37,133 | ) | | | (29,560 | ) |
| | | | | | | | | | |
| Net cash used in investing activities | | | (355,270 | ) | | | (286,633 | ) | | | (373,975 | ) |
| | | | | | | | | | |
| |
FINANCING ACTIVITIES | | | | | | | | | | | | |
| Net proceeds from issuance of common shares | | | 87,043 | | | | 86,462 | | | | 85,171 | |
| Net proceeds from issuance of preferred units | | | 26,305 | | | | 48,686 | | | | — | |
| Net proceeds from issuance of unsecured notes | | | 295,393 | | | | 296,424 | | | | 197,517 | |
| Repayments of unsecured notes | | | (100,000 | ) | | | — | | | | (100,000 | ) |
| Proceeds from mortgage loans | | | — | | | | — | | | | 9,618 | |
| Repayments of mortgage loans | | | (56,406 | ) | | | (173,926 | ) | | | (23,592 | ) |
| Proceeds from credit facility | | | 725,025 | | | | 784,800 | | | | 477,800 | |
| Repayments on credit facility | | | (733,515 | ) | | | (841,350 | ) | | | (332,800 | ) |
| Increase in deferred financing costs | | | (1,635 | ) | | | (3,465 | ) | | | (199 | ) |
| Distributions paid on common shares | | | (219,873 | ) | | | (212,305 | ) | | | (204,339 | ) |
| Contributions from minority interests | | | — | | | | — | | | | 1,158 | |
| Distributions to minority interests | | | — | | | | (3,937 | ) | | | — | |
| Distributions paid on units | | | (22,664 | ) | | | (20,859 | ) | | | (20,716 | ) |
| | | | | | | | | | |
| Net cash (used in) provided by financing activities | | | (327 | ) | | | (39,470 | ) | | | 89,618 | |
| | | | | | | | | | |
| (Decrease) increase in cash and cash equivalents | | | (10,696 | ) | | | 34,646 | | | | 8,979 | |
| Increase (decrease) in cash and cash equivalents related to foreign currency translation | | | 2,804 | | | | (6,684 | ) | | | 2,879 | |
| Cash and cash equivalents at beginning of year | | | 61,629 | | | | 33,667 | | | | 21,809 | |
| | | | | | | | | | |
| Cash and cash equivalents at end of year | | $ | 53,737 | | | $ | 61,629 | | | $ | 33,667 | |
| | | | | | | | | | |
| |
SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS | | | | | | | | | | | | |
| Write-off of fully depreciated property and deferred costs | | $ | 87,424 | | | $ | 83,794 | | | $ | 27,990 | |
| Issuance of operating partnership common units | | | 30,000 | | | | — | | | | — | |
| Acquisition of properties | | | (3,066 | ) | | | (51,716 | ) | | | (11,305 | ) |
| Assumption of mortgage loans | | | 3,066 | | | | 51,716 | | | | 11,305 | |
See accompanying notes.
39
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF LIBERTY PROPERTY TRUST
1. ORGANIZATION
Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (a “REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by Liberty Property Limited Partnership (the “Operating Partnership” and, together with the Trust and their consolidated subsidiaries, the “Company”). The Trust is the sole general partner and also a limited partner of the Operating Partnership, owning 95.6% of the common equity of the Operating Partnership at December 31, 2006. The Company provides leasing, property management, development, acquisition, and other tenant-related services for a portfolio of industrial and office properties which are located principally within the Mid-Atlantic, Southeastern and Midwestern United States and the United Kingdom.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“US GAAP”) requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.
Principles of Consolidation
The consolidated financial statements of the Company include the Trust, the Operating Partnership and wholly owned subsidiaries and those subsidiaries in which the Company owns a majority voting interest with the ability to control operations of the subsidiaries and where no approval, veto or other important rights have been granted to the minority shareholders. All significant intercompany transactions and accounts have been eliminated.
Reclassifications
Certain amounts from prior years have been reclassified to conform to current-year presentation.
Real Estate and Depreciation
The properties are recorded at cost and are depreciated using the straight line method over their estimated useful lives. The estimated useful lives are as follows:
| | | |
| Building and improvements | | 40 years (blended) |
| Equipment | | 5 – 10 years |
| Tenant improvements | | Term of the related lease |
Expenditures directly related to acquisition or improvement of real estate, including interest and other costs capitalized during development, are included in net real estate and are stated at cost. The capitalized costs include pre-construction costs essential to the development of the property, development and construction costs, interest costs, real estate taxes, development-related salaries and other costs incurred during the period of development. Expenditures for maintenance and repairs are charged to operations as incurred.
In accordance with the Financial Accounting Standards Board (“FASB”) Statement of Financial Standards (“SFAS”) No. 141, “Business Combinations,” the Company allocates the purchase price of real estate to land, building and improvements and intangibles based on the relative fair value of each component. The value ascribed to in-place leases is based on the rental rates for the existing leases compared to market rent for leases of similar terms and present valuing the difference based on market interest rates. Origination values are also assigned to in-place leases, and, where appropriate, value is assigned to customer relationships. The Company depreciates the amounts allocated to building and improvements over 40 years and the amounts allocated to intangible assets relating to in-place leases, which are included in deferred financing and leasing costs and other liabilities in the accompanying consolidated balance sheets, over the remaining term of the related leases.
Once a property is designated as held for sale, no further depreciation expense is recorded. Operations for properties identified as held for sale and/or sold where no continuing involvement exists are presented in discontinued operations for all periods presented.
The Company evaluates its real estate investments and its investments in unconsolidated joint ventures upon occurrence of a significant adverse change in its operations to assess whether any impairment indicators are present that affect the recovery of the recorded value. If any real estate investment or investment in unconsolidated joint
40
ventures is considered impaired, a loss is recognized to reduce the carrying value of the property to its estimated fair value.
Investments in Unconsolidated Joint Ventures
The Company accounts for its investments in unconsolidated joint ventures using the equity method of accounting as the Company exercises significant influence, but does not control these entities. Under the equity method of accounting, the net equity investment of the Company is reflected in the accompanying consolidated balance sheets and the Company’s share of net income from the joint ventures is included in the accompanying consolidated statements of operations.
Cash and Cash Equivalents
Highly liquid investments with a maturity of three months or less when purchased are classified as cash equivalents.
Restricted Cash
Restricted cash includes tenant security deposits and escrow funds that the Company maintains pursuant to certain mortgage loans. Restricted cash also includes the undistributed proceeds from the sale of residential land in Kent County, United Kingdom.
Accounts Receivable
The Company’s accounts receivable are comprised of rents and charges for property operating costs due from tenants. The Company periodically performs a detailed review of amounts due from tenants to determine if accounts receivable balances are collectible. Based on this review, accounts receivable are reduced by an allowance for doubtful accounts. The Company considers tenant credit quality and payment history and general economic conditions in determining the allowance for doubtful accounts. If the accounts receivable balance is subsequently deemed uncollectible, the receivable and allowance for doubtful account balance is written off.
The allowance for doubtful accounts at December 31, 2006 and 2005 was $5.1 million and $6.7 million, respectively.
Deferred Rent Receivable
The Company’s deferred rent receivable represents the cumulative difference between rent revenue recognized on a straight line basis and contractual payments due under the terms of tenant leases.
Revenues
The Company earns rental income under operating leases with tenants. Rental income is recognized on a straight line basis over the applicable lease term. Operating expense reimbursements consisting of amounts due from tenants for real estate taxes, utilities and other recoverable costs are recognized as revenue in the period in which the corresponding expenses are incurred.
Termination fees (included in rental revenue) are fees that the Company has agreed to accept in consideration for permitting certain tenants to terminate their lease prior to the contractual expiration date. The Company recognizes termination fees in accordance with Staff Accounting Bulletin 104 when the following conditions are met:
| | a) | | the termination agreement is executed, |
| |
| | b) | | the termination fee is determinable, |
| |
| | c) | | all landlord services, pursuant to the terminated lease, have been rendered, and |
| |
| | d) | | collectibility of the termination fee is assured. |
Deferred Financing and Leasing Costs
Costs incurred in connection with financing or leasing are capitalized and amortized over the term of the related loan or lease. Deferred financing cost amortization is reported as interest expense. Intangible assets related to acquired in-place leases are amortized over the terms of the related leases.
Costs Incurred for Preferred Unit Issuance
Costs incurred in connection with the Company’s preferred unit issuances are reflected as a reduction of minority interest.
41
Income per Common Share
The following table sets forth the computation of basic and diluted income per common share (in thousands, except per share amounts):
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2006 | | | 2005 | |
| | | | | | | Weighted | | | | | | | | | | | Weighted | | | | |
| | | | | | | Average | | | | | | | | | | | Average | | | | |
| | | Income | | | Shares | | | Per | | | Income | | | Shares | | | Per | |
| | | (Numerator) | | | (Denominator) | | | Share | | | (Numerator) | | | (Denominator) | | | Share | |
Basic income from continuing operations | | | | | | | | | | | | | | | | | | | | | | | | |
| Income from continuing operations | | $ | 153,697 | | | | 89,313 | | | $ | 1.72 | | | $ | 204,841 | | | | 86,986 | | | $ | 2.36 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Dilutive shares for long-term compensation plans | | | — | | | | 1,179 | | | | | | | | — | | | | 1,390 | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Diluted income from continuing operations | | | | | | | | | | | | | | | | | | | | | | | | |
| Income from continuing operations and assumed conversions | | | 153,697 | | | | 90,492 | | | $ | 1.70 | | | | 204,841 | | | | 88,376 | | | $ | 2.32 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Basic income from discontinued operations | | | | | | | | | | | | | | | | | | | | | | | | |
| Discontinued operations net of minority interest | | | 112,877 | | | | 89,313 | | | $ | 1.26 | | | | 44,510 | | | | 86,986 | | | $ | 0.51 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Dilutive shares for long-term compensation plans | | | — | | | | 1,179 | | | | | | | | — | | | | 1,390 | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Diluted income from discontinued operations | | | | | | | | | | | | | | | | | | | | | | | | |
| Discontinued operations net of minority interest | | | 112,877 | | | | 90,492 | | | $ | 1.25 | | | | 44,510 | | | | 88,376 | | | $ | 0.50 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Basic income per common share | | | | | | | | | | | | | | | | | | | | | | | | |
| Net income | | | 266,574 | | | | 89,313 | | | $ | 2.98 | | | | 249,351 | | | | 86,986 | | | $ | 2.87 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Dilutive shares for long-term compensation plans | | | — | | | | 1,179 | | | | | | | | — | | | | 1,390 | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Diluted income per common share | | | | | | | | | | | | | | | | | | | | | | | | |
| Net income and assumed conversions | | $ | 266,574 | | | | 90,492 | | | $ | 2.95 | | | $ | 249,351 | | | | 88,376 | | | $ | 2.82 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | 2004 | |
| | | | | | | Weighted | | | | |
| | | | | | | Average | | | | |
| | | Income | | | Shares | | | Per | |
| | | (Numerator) | | | (Denominator) | | | Share | |
Basic income from continuing operations | | | | | | | | | | | | |
| Income from continuing operations | | $ | 137,588 | | | | 84,534 | | | $ | 1.63 | |
| | | | | | | | | | | | |
| Dilutive shares for long-term compensation plans | | | — | | | | 1,490 | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | | | |
Diluted income from continuing operations | | | | | | | | | | | | |
| Income from continuing operations and assumed conversions | | | 137,588 | | | | 86,024 | | | $ | 1.60 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
Basic income from discontinued operations | | | | | | | | | | | | |
| Discontinued operations net of minority interest | | | 23,855 | | | | 84,534 | | | $ | 0.28 | |
| | | | | | | | | | | | |
| Dilutive shares for long-term compensation plans | | | — | | | | 1,490 | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | | | |
Diluted income from discontinued operations | | | | | | | | | | | | |
| Discontinued operations net of minority interest | | | 23,855 | | | | 86,024 | | | $ | 0.28 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
Basic income per common share | | | | | | | | | | | | |
| Net income | | | 161,443 | | | | 84,534 | | | $ | 1.91 | |
| | | | | | | | | | | | |
| Dilutive shares for long-term compensation plans | | | — | | | | 1,490 | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | | | |
Diluted income per common share | | | | | | | | | | | | |
| Net income and assumed conversions | | $ | 161,443 | | | | 86,024 | | | $ | 1.88 | |
| | | | | | | | | | |
Fair Value of Financial Instruments
The carrying value of cash and cash equivalents, restricted cash, accounts receivable, deferred rent receivable, accounts payable, accrued interest, dividends and distributions payable and other liabilities are reasonable estimates of fair values because of the short-term nature of these instruments. The fair value of the Company’s long-term debt, which is based on estimates by management and on rates quoted on December 31, 2006 for comparable loans, exceeds the aggregate carrying value by approximately $91 million at December 31, 2006.
Income Taxes
The Company has elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”). As a result, the Company generally is not subject to federal income taxation at the corporate level to the extent it distributes annually at least 90% of its REIT taxable income, as defined in the Code, to its shareholders and satisfies certain other organizational and operational requirements. The Company has met these requirements and, accordingly, no provision has been made for federal income taxes in the accompanying consolidated financial statements.
42
Several of the Company’s subsidiaries are taxable REIT subsidiaries (each a “TRS”) and are subject to federal income taxes. In general, a TRS may perform additional services for tenants and generally may engage in real estate or non-real estate business that are not permitted REIT activities. The Company is also taxed in certain states and the United Kingdom. Accordingly, the Company has recognized federal, state and United Kingdom income taxes in accordance with US GAAP, as applicable. If the Company fails to qualify as a REIT in any taxable year, the Company will be subject to federal income tax on its taxable income at regular corporate rates.
Certain of the Company’s taxable REIT subsidiaries have net operating loss carryforwards of approximately $9.7 million available as of December 31, 2006. These carryforwards begin to expire in 2013. We have considered estimated future taxable income and have determined that a valuation allowance for the full carrying value of net operating loss carryforwards is appropriate.
The Federal tax cost basis of the real estate at December 31, 2006 was $5.0 billion.
Share Based Compensation
At December 31, 2006, the Company had a share-based employee compensation plan as fully described in Note 10. Effective January 1, 2006 the Company adopted for its share-based employee compensation plan (the “Plan”) the provisions of SFAS No. 123(R), “Share-Based Payment” (“SFAS No. 123(R)”), using the modified prospective application method. In accordance with SFAS No. 123(R), share-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as expense over the employees’ requisite service period. In January 2003, the Company adopted the fair value recognition provisions of SFAS No. 123, “Accounting for Stock-Based Compensation", prospectively for all employee option awards granted, modified, or settled after January 1, 2003. Prior to 2003, the Company accounted for the Plan under the recognition and measurement provisions of Accounting Principles Board (“APB”) Opinion No. 25, “Accounting for Stock Issued to Employees", and related Interpretations.
Under the modified prospective application method, results for prior periods have not been restated to reflect the effects of implementing SFAS No. 123(R).
Certain restricted share awards and option awards are subject to accelerated vesting upon retirement. The Company historically accounted for these awards over the explicit service period. Upon adoption of SFAS No. 123(R), the Company began expensing new awards to individuals qualifying for share acceleration over the substantive service period. Compensation costs relating to awards granted prior to the adoption of SFAS No. 123(R) continue to be expensed over the explicit service period. Had the Company accounted for those awards over the substantive service period, compensation costs for the year ended December 31, 2005 would have increased by $0.2 million and for the year ended December 31, 2004 would have increased by $0.5 million.
Included in compensation costs for the year ended December 31, 2006 was a charge of $0.2 million, which resulted from the accelerated vesting of unvested options and shares during the year ended December 31, 2006.
Foreign Currency Translation
The functional currency of the Company’s United Kingdom operations is pounds sterling. The Company translates the financial statements for the United Kingdom operations into US dollars. Gains and losses resulting from this translation do not impact the results of operations and are included in accumulated other comprehensive income as a separate component of shareholders’ equity. Accumulated other comprehensive income consists solely of translation adjustments as described. Other comprehensive income (loss) was $10.4 million, ($15.2 million) and $10.4 million for the years ended December 31, 2006, 2005 and 2004, respectively. Upon sale or upon complete or substantially complete liquidation of a foreign investment, the gain or loss on the sale will include the cumulative translation adjustments that have been previously recorded in other comprehensive income.
Recently Issued Accounting Standards
SFAS No. 153
In December 2004, the FASB issued SFAS No. 153, “Accounting for Non-monetary Transactions” (“SFAS No. 153”). SFAS No.153 requires non-monetary exchanges to be accounted for at fair value, recognizing any gain or loss, if the transactions meet a commercial-substance criterion and fair value is determinable. The provisions of SFAS No. 153 are effective for non-monetary asset exchanges occurring in fiscal years beginning after June 15, 2005. The Company adopted the provisions of SFAS No. 153 on January 1, 2006 and the adoption did not have a material impact on the Company’s results of operations or its financial position.
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EITF Issue 04-5
In June 2005, the FASB ratified its consensus in EITF Issue 04-5, “Determining Whether a General Partner, or the General Partners as a Group, Controls a Limited Partnership or Similar Entity When the Limited Partners Have Certain Rights” (“Issue 04-5”). The effective date for Issue 04-5 was June 29, 2005 for all new or modified partnerships and January 1, 2006 for all other partnerships. The adoption of Issue 04-5 did not have a material impact on the Company’s results of operations or its financial position.
SFAS No. 157
In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS No. 157”), which defines fair value, establishes a framework for consistently measuring fair value under GAAP, and expands disclosures about fair value measurements. SFAS No. 157 is effective for the Company beginning January 1, 2008, and the provisions of SFAS No. 157 will be applied prospectively as of that date. The Company does not anticipate that the adoption of this statement will have a material effect on its financial position or results of operations.
FIN 48
In July 2006, the FASB issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 is an interpretation of SFAS No. 109, “Accounting for Income Taxes,” and it seeks to reduce the diversity in practice associated with certain aspects of measurement and recognition in accounting for income taxes. In addition, FIN 48 provides guidance on derecognition, classification, interest and penalties, and accounting in interim periods and requires expanded disclosure with respect to the uncertainty in income taxes. FIN 48 is effective for the Company beginning January 1, 2007. The cumulative effect, if any, of applying FIN 48 is to be reported as an adjustment to the opening balance of retained earnings in the year of adoption. The Company is currently evaluating the financial impact, if any, of the interpretation and will adopt the provisions of FIN 48 on January 1, 2007.
3. REAL ESTATE
The Company owns and operates industrial and office properties located principally in suburban mixed-use developments or business parks. The carrying value of these properties by type as of December 31, 2006 and 2005 is as follows (in thousands):
| | | | | | | | | | | | | | | | | |
| | | Land | | | Buildings | | | | | | | | |
| | | And Land | | | And | | | | | | | Accumulated | |
| | | Improvements | | | Improvements | | | Total | | | Depreciation | |
| 2006 | | | | | | | | | | | | | | | | |
| Industrial properties | | $ | 309,119 | | | $ | 1,652,100 | | | $ | 1,961,219 | | | $ | 372,444 | |
| Office properties | | | 368,956 | | | | 2,162,337 | | | | 2,531,293 | | | | 433,865 | |
| | | | | | | | | | | | | |
| 2006 Total | | $ | 678,075 | | | $ | 3,814,437 | | | $ | 4,492,512 | | | $ | 806,309 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| 2005 | | | | | | | | | | | | | | | | |
| Industrial properties | | $ | 305,207 | | | $ | 1,657,992 | | | $ | 1,963,199 | | | $ | 336,721 | |
| Office properties | | | 315,148 | | | | 2,006,044 | | | | 2,321,192 | | | | 395,718 | |
| | | | | | | | | | | | | |
| 2005 Total | | $ | 620,355 | | | $ | 3,664,036 | | | $ | 4,284,391 | | | $ | 732,439 | |
| | | | | | | | | | | | | |
Depreciation expense was $124.9 million in 2006, $123.3 million in 2005 and $114.2 million in 2004.
As of December 31, 2006, the Company commenced development on 38 properties, which upon completion are expected to comprise 7.4 million square feet of leaseable space. As of December 31, 2006, $538.3 million had been expended for the development of these projects and an additional $475.0 million is estimated to be required for completion.
44
Information on the operating properties the Company sold during the years ended December 31, 2006 and 2005 is as follows:
| | | | | | | | | | | | | |
| 2006 Sales | | Number of | | | Leaseable | | | | |
| Segment | | Buildings | | | Square Feet | | | Proceeds | |
| | | | | | | | | | | (in thousands) | |
| Delaware Valley | | | | | | | | | | | | |
| Southeastern Pennsylvania | | | 3 | | | | 1,146,940 | | | $ | 101,700 | |
| Other | | | 3 | | | | 155,056 | | | | 10,760 | |
| Midwest | | | | | | | | | | | | |
| Lehigh Valley | | | 5 | | | | 716,758 | | | | 109,255 | |
| Other | | | 16 | | | | 2,519,409 | | | | 134,375 | |
| Mid-Atlantic | | | 16 | | | | 1,449,464 | | | | 139,300 | |
| Florida | | | 3 | | | | 147,262 | | | | 7,474 | |
| | | | | | | | | | |
| Total | | | 46 | | | | 6,134,889 | | | $ | 502,864 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| 2005 Sales | | Number of | | | Leaseable | | | | |
| Segment | | Buildings | | | Square Feet | | | Proceeds | |
| | | | | | | | | | | (in thousands) | |
| Delaware Valley | | | | | | | | | | | | |
| Southeastern Pennsylvania | | | 2 | | | | 139,760 | | | $ | 7,864 | |
| Other | | | 3 | | | | 177,733 | | | | 12,333 | |
| Midwest | | | | | | | | | | | | |
| Lehigh Valley | | | 2 | | | | 142,204 | | | | 8,676 | |
| Other | | | 18 | | | | 400,262 | | | | 23,236 | |
| Mid-Atlantic | | | 4 | | | | 727,732 | | | | 51,570 | |
| Florida | | | 6 | | | | 726,632 | | | | 53,834 | |
| United Kingdom | | | 16 | | | | 602,175 | | | | 263,343 | |
| | | | | | | | | | |
| Total | | | 51 | | | | 2,916,498 | | | $ | 420,856 | |
| | | | | | | | | | |
4. INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES
Liberty Venture I, LP
The Company has a 25% interest in Liberty Venture I, LP, an entity engaged in ownership of industrial distribution properties in New Jersey (the Delaware Valley — Other segment). The Company also provides development, leasing and property management services for a fee, and may receive a promoted interest if certain return thresholds are met.
The Company recognized $634,000, $934,000, and $742,000 for development, leasing and property management services during the years ended December 31, 2006, 2005 and 2004, respectively.
Kings Hill Unit Trust
On December 14, 2005, the Company entered into a joint venture agreement (“Kings Hill Unit Trust”) with Doughty Hanson & Co. Real Estate. The Company sold 15 properties with a net book value of $125.8 million to the joint venture for proceeds of $219.9 million. In addition, the Company holds a $7.5 million note receivable from the Kings Hill Unit Trust and retained a 20% ownership interest in the joint venture. The note receivable bears interest at a 9% rate. The Company recognized a $75.1 million gain net of $14.5 million of tax on the sale of the properties to the Kings Hill Unit Trust. Due to the Company’s continuing involvement in this joint venture, the operations to the date of sale, as well as the gain on sale and related taxes are included in income from continuing operations in the accompanying consolidated statements of operations. The properties which were sold are industrial-flex and office properties and were included in the Company’s United Kingdom segment. The Company provides property management services for a fee, and may receive a promoted interest if certain return thresholds are met.
Income from property management fees and interest was $1.3 million during the year ended December 31, 2006.
Liberty/Commerz 1701 JFK Boulevard, LP
On April 13, 2006, the Company entered into a joint venture (“Liberty/Commerz 1701 JFK Boulevard, LP”) with an affiliate of Commerzleasing und Immobilien AG, a wholly owned subsidiary of Commerzbank AG, pursuant to which it sold an 80% interest in the equity of Comcast Center, a 1.25 million square foot office tower the Company is developing in Philadelphia, Pennsylvania. The transaction valued the property at $512 million. In connection with the transaction, the joint venture obtained a $324 million forward loan commitment at a rate of 6.15% assuming the loan closes in
45
March 2008. In addition to retaining a 20% interest, the Company will earn leasing and property management fees and may receive a promoted interest if certain return thresholds are met.
Under the terms of the joint venture arrangement, the Company is obligated to complete development of the building, the estimated cost of which is approximately $495 million, and is also obligated to complete the initial lease up of the property. Based on the updated leasing schedule Liberty may have to fund $3.5 million in rent support. The criteria for sale recognition in accordance with SFAS No. 66, “Accounting for the Sale of Real Estate,” have not been met and this transaction is accounted for as a financing arrangement.
Liberty Illinois, LP
On April 25, 2006, the Company entered into a joint venture (“Liberty Illinois, LP”) with the New York State Common Retirement Fund, selling a 75% equity interest in six distribution buildings totaling 2.1 million square feet and 104 acres of developable land. The joint venture valued the buildings and land at $125.0 million. The Company retained a 25% ownership interest in the joint venture, and will earn development, leasing and property management fees, and may receive a promoted interest if certain return thresholds are met.
During the year ended December 31, 2006 the joint venture began construction on two buildings. Under the terms of the joint venture arrangement, the Company is obligated to complete development of the buildings, the estimated cost of which is approximately $39 million.
The Company recognized $777,000 for development and property management services during the year ended December 31, 2006.
Other Joint Ventures
As of December 31, 2006, the Company had a 50% ownership interest in three additional unconsolidated joint ventures. These joint ventures have investments in properties under development, land or in leaseholds and do not operate or own operating properties.
The Company’s share of each of the joint venture’s earnings is included in equity in earnings (loss) of unconsolidated joint ventures in the accompanying consolidated statements of operations.
The condensed balance sheets as of December 31, 2006 and 2005 and statements of operations for Liberty Venture I, LP, Liberty Illinois, LP, Kings Hill Unit Trust and other unconsolidated joint ventures for the years ended December 31, 2006, 2005 and 2004 are as follows (in thousands):
Balance Sheets:
| | | | | | | | | | | | | | | | | | | | | |
| | | December 31, 2006 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Real estate assets | | $ | 116,324 | | | $ | 119,787 | | | $ | 228,120 | | | $ | — | | | $ | 464,231 | |
| Accumulated depreciation | | | (10,183 | ) | | | (1,842 | ) | | | (4,213 | ) | | | — | | | | (16,238 | ) |
| | | | | | | | | | | | | | | | |
| Real estate assets, net | | | 106,141 | | | | 117,945 | | | | 223,907 | | | | — | | | | 447,993 | |
| Development in progress | | | — | | | | 28,420 | | | | — | | | | 24,088 | | | | 52,508 | |
| Land held for development | | | 2,733 | | | | 8,246 | | | | — | | | | 31,078 | | | | 42,057 | |
| Other assets | | | 13,723 | | | | 6,214 | | | | 20,838 | | | | 13,024 | | | | 53,799 | |
| | | | | | | | | | | | | | | | |
| Total assets | | $ | 122,597 | | | $ | 160,825 | | | $ | 244,745 | | | $ | 68,190 | | | $ | 596,357 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Debt | | $ | 74,063 | | | $ | 86,681 | | | $ | 186,010 | | | $ | 10,600 | | | $ | 357,354 | |
| Other liabilities | | | 1,182 | | | | 5,005 | | | | 49,584 | | | | 4,420 | | | | 60,191 | |
| Equity | | | 47,352 | | | | 69,139 | | | | 9,151 | | | | 53,170 | | | | 178,812 | |
| | | | | | | | | | | | | | | | |
| Total liabilities and equity | | $ | 122,597 | | | $ | 160,825 | | | $ | 244,745 | | | $ | 68,190 | | | $ | 596,357 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Company’s net investment in unconsolidated joint ventures (1) | | $ | 11,293 | | | $ | 11,259 | | | $ | — | | | $ | 24,644 | | | $ | 47,196 | |
| | | | | | | | | | | | | | | | |
46
Balance Sheets:
| | | | | | | | | | | | | | | | | | | | | |
| | | December 31, 2005 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Real estate assets | | $ | 121,092 | | | $ | — | | | $ | 202,200 | | | $ | — | | | $ | 323,292 | |
| Accumulated depreciation | | | (7,579 | ) | | | — | | | | (284 | ) | | | — | | | | (7,863 | ) |
| | | | | | | | | | | | | | | | |
| Real estate assets, net | | | 113,513 | | | | — | | | | 201,916 | | | | — | | | | 315,429 | |
| Development in progress | | | — | | | | — | | | | — | | | | — | | | | — | |
| Land held for development | | | 2,750 | | | | — | | | | — | | | | 37,812 | | | | 40,562 | |
| Other assets | | | 14,922 | | | | — | | | | 18,499 | | | | 9,980 | | | | 43,401 | |
| | | | | | | | | | | | | | | | |
| Total assets | | $ | 131,185 | | | $ | — | | | $ | 220,415 | | | $ | 47,792 | | | $ | 399,392 | |
| | | | | | | | | | | | | | | | |
| Debt | | $ | 77,826 | | | $ | — | | | $ | 163,448 | | | $ | — | | | $ | 241,274 | |
| Other liabilities | | | 2,284 | | | | — | | | | 44,028 | | | | 678 | | | | 46,990 | |
| Equity | | | 51,075 | | | | — | | | | 12,939 | | | | 47,114 | | | | 111,128 | |
| | | | | | | | | | | | | | | | |
| Total liabilities and equity | | $ | 131,185 | | | $ | — | | | $ | 220,415 | | | $ | 47,792 | | | $ | 399,392 | |
| | | | | | | | | | | | | | | | |
| Company’s net investment in unconsolidated joint ventures (1) | | $ | 12,310 | | | $ | — | | | $ | — | | | $ | 21,212 | | | $ | 33,522 | |
| | | | | | | | | | | | | | | | |
| | |
| (1) | | Differences between the Company’s net investment in unconsolidated joint ventures and its underlying equity in the net assets of the venture is primarily a result of the deferral of gains associated with the sales of properties to joint ventures in which the Company retains an ownership interest. Deferred gains are amortized to equity in earnings (loss) of joint ventures over the average estimated useful lives of the assets sold. |
Statements of Operations:
| | | | | | | | | | | | | | | | | | | | | |
| | | Year Ended December 31, 2006 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Total revenue | | $ | 18,395 | | | $ | 7,471 | | | $ | 18,183 | | | $ | — | | | $ | 44,049 | |
| Operating expense | | | 5,364 | | | | 1,833 | | | | 2,181 | | | | 171 | | | | 9,549 | |
| | | | | | | | | | | | | | | | |
| | | | 13,031 | | | | 5,638 | | | | 16,002 | | | | (171 | ) | | | 34,500 | |
| Interest | | | (4,501 | ) | | | (2,527 | ) | | | (13,455 | ) | | | — | | | | (20,483 | ) |
| Depreciation and amortization | | | (4,544 | ) | | | (2,502 | ) | | | (6,267 | ) | | | — | | | | (13,313 | ) |
| Other income/(expense) | | | (127 | ) | | | 5 | | | | (604 | ) | | | 392 | | | | (334 | ) |
| Gain on sale | | | 2,644 | | | | — | | | | — | | | | 138 | | | | 2,782 | |
| | | | | | | | | | | | | | | | |
| Net income (loss) | | $ | 6,503 | | | $ | 614 | | | $ | (4,324 | ) | | $ | 359 | | | $ | 3,152 | |
| | | | | | | | | | | | | | | | |
| Company’s equity in earnings (loss) of unconsolidated joint ventures | | $ | 1,651 | | | $ | 259 | | | $ | (657 | ) | | $ | 179 | | | $ | 1,432 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | Year Ended December 31, 2005 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Total revenue | | $ | 18,592 | | | $ | — | | | $ | 745 | | | $ | — | | | $ | 19,337 | |
| Operating expense | | | 5,859 | | | | — | | | | 201 | | | | 32 | | | | 6,092 | |
| | | | | | | | | | | | | | | | |
| | | | 12,733 | | | | — | | | | 544 | | | | (32 | ) | | | 13,245 | |
| Interest | | | (4,569 | ) | | | — | | | | (634 | ) | | | — | | | | (5,203 | ) |
| Depreciation and amortization | | | (4,933 | ) | | | — | | | | (386 | ) | | | — | | | | (5,319 | ) |
| Other income/(expense) | | | (184 | ) | | | — | | | | (33 | ) | | | 3,066 | | | | 2,849 | |
| Gain on sale | | | 7,555 | | | | — | | | | — | | | | — | | | | 7,555 | |
| | | | | | | | | | | | | | | | |
| Net income (loss) | | $ | 10,602 | | | $ | — | | | $ | (509 | ) | | $ | 3,034 | | | $ | 13,127 | |
| | | | | | | | | | | | | | | | |
| Company’s equity in earnings (loss) of unconsolidated joint ventures | | $ | 2,650 | | | $ | — | | | $ | (110 | ) | | $ | — | | | $ | 2,540 | |
| | | | | | | | | | | | | | | | |
47
Statements of Operations:
| | | | | | | | | | | | | | | | | | | | | |
| | | Year Ended December 31, 2004 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Total revenue | | $ | 18,746 | | | $ | — | | | $ | — | | | $ | — | | | $ | 18,746 | |
| Operating expense | | | 6,736 | | | | — | | | | — | | | | — | | | | 6,736 | |
| | | | | | | | | | | | | | | | |
| | | | 12,010 | | | | — | | | | — | | | | — | | | | 12,010 | |
| Interest | | | (4,426 | ) | | | — | | | | — | | | | — | | | | (4,426 | ) |
| Depreciation and amortization | | | (10,683 | ) | | | — | | | | — | | | | — | | | | (10,683 | ) |
| | | | | | | | | | | | | | | | |
| Net loss | | $ | (3,099 | ) | | $ | — | | | $ | — | | | $ | — | | | $ | (3,099 | ) |
| | | | | | | | | | | | | | | | |
| Company’s equity in loss of unconsolidated joint ventures | | $ | (775 | ) | | $ | — | | | $ | — | | | $ | — | | | $ | (775 | ) |
| | | | | | | | | | | | | | | | |
5. DEFERRED FINANCING AND LEASING COSTS
Deferred financing and leasing costs at December 31, 2006 and 2005 are as follows (in thousands):
| | | | | | | | | |
| | | December 31, | |
| | | 2006 | | | 2005 | |
| Deferred leasing costs | | $ | 150,179 | | | $ | 154,886 | |
| Deferred financing costs | | | 8,476 | | | | 23,266 | |
| In-place lease value and related intangible asset | | | 71,496 | | | | 52,945 | |
| | | | | | | |
| | | | 230,151 | | | | 231,097 | |
| Accumulated amortization | | | (100,406 | ) | | | (108,103 | ) |
| | | | | | | |
| Total | | $ | 129,745 | | | $ | 122,994 | |
| | | | | | | |
6. INDEBTEDNESS
Indebtedness consists of mortgage loans, unsecured notes, borrowings under the credit facility and the Liberty/Commerz 1701 JFK Boulevard, LP, financing arrangement. The weighted average interest rates for the years ended December 31, 2006, 2005 and 2004, were 6.6%, 6.6% and 6.7%, respectively. Interest costs during the years ended December 31, 2006, 2005 and 2004 in the amount of $30.8 million, $17.7 million and $13.2 million, respectively, were capitalized. Cash paid for interest for the years ended December 31, 2006, 2005 and 2004, was $150.2 million, $148.8 million and $130.4 million, respectively.
During the year ended December 31, 2006, the Company satisfied a $100 million 6.95% medium term note and issued a $300 million 5.50% senior unsecured note due December 15, 2016. The Company used the net proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.
During the year ended December 31, 2005, the Company issued a $300 million 5.125% senior unsecured note due March 2, 2015. The Company used the net proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.
The Company is subject to financial covenants contained in some of the debt agreements, the most restrictive of which are detailed below under the heading “Credit Facility.” As of December 31, 2006 the Company was in compliance with all financial covenants.
Mortgage Loans, Unsecured Notes
Mortgage loans with maturities ranging from 2007 to 2021 are collateralized by and in some instances cross-collateralized by properties with a net book value of $330.0 million.
The interest rates on $2,141.0 million of mortgage loans and unsecured notes are fixed and range from 4.6% to 8.8%. The weighted average remaining term for the mortgage loans and unsecured notes is 6.0 years.
48
Credit Facility
$600 Million Unsecured Revolving Credit Facility
During the fourth quarter of 2005, the Company obtained a four-year, $600 million unsecured revolving credit facility (the “$600 million Credit Facility”) replacing a $450 million unsecured revolving credit facility due January 16, 2006. Based on the Company’s present ratings, borrowings under the $600 million Credit Facility are priced at LIBOR plus 65 basis points. The $600 million Credit Facility contains a competitive bid option, whereby participating lenders bid on the interest rate to be charged. This feature is available for up to 50% of the amount of the facility. The interest rate on the $94.0 million of borrowings outstanding as of December 31, 2006 was 5.59%. The current ratings for the Company’s senior unsecured debt are Baa2, BBB, and BBB+ from Moody’s, S&P and Fitch, respectively. The $600 million Credit Facility has an accordion feature for an additional $200 million. There is also a 15 basis point annual facility fee on the current borrowing capacity. The $600 million Credit Facility expires on January 16, 2010 and may be extended for a one-year period. The $600 million Credit Facility contains financial covenants, certain of which are set forth below:
| | • | | total debt to total assets may not exceed 0.60:1; |
| |
| | • | | earnings before interest, taxes, depreciation and amortization to fixed charges may not be less than 1.50:1; |
| |
| | • | | unsecured debt to unencumbered asset value must equal or be less than 60%; and |
| |
| | • | | unencumbered net operating income to unsecured interest expense must equal or exceed 200%. |
Liberty/Commerz 1701 JFK Boulevard, LP Financing Arrangement
The equity contribution from the Company’s joint venture partner in the Liberty/Commerz 1701 JFK Boulevard, LP is treated as a financing arrangement- see Note 4. This equity contribution receives a return equal to the greater of 5% or the current rate on the $600 million Credit Facility.
The scheduled principal amortization and maturities of the Company’s mortgage loans, unsecured notes outstanding, the $600 million Credit Facility, the Liberty/Commerz 1701 JFK Boulevard, LP financing arrangement and the related weighted average interest rates are as follows (in thousands, except percentages):
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | Weighted | |
| | | Mortgages | | | | | | | | | | | | | | | Average | |
| | | Principal | | | Principal | | | Unsecured | | | Credit | | | | | | | Interest | |
| | | Amortization | | | Maturities | | | Notes | | | Facility | | | Total | | | Rate | |
| 2007 | | $ | 8,820 | | | $ | 1,553 | | | $ | 100,000 | | | $ | — | | | $ | 110,373 | | | | 7.22 | % |
| 2008 | | | 7,975 | | | | 39,753 | | | | — | | | | 152,960 | (1) | | | 200,688 | | | | 6.15 | % |
| 2009 | | | 5,699 | | | | 46,148 | | | | 270,000 | | | | — | | | | 321,847 | | | | 7.77 | % |
| 2010 | | | 4,877 | | | | 4,738 | | | | 200,000 | | | | 94,000 | | | | 303,615 | | | | 7.51 | % |
| 2011 | | | 4,153 | | | | 10,730 | | | | 250,000 | | | | — | | | | 264,883 | | | | 7.26 | % |
| 2012 | | | 3,274 | | | | 32,911 | | | | 235,000 | | | | — | | | | 271,185 | | | | 6.47 | % |
| 2013 | | | 2,751 | | | | — | | | | — | | | | — | | | | 2,751 | | | | 6.00 | % |
| 2014 | | | 2,894 | | | | 2,681 | | | | 200,000 | | | | — | | | | 205,575 | | | | 5.65 | % |
| 2015 | | | 3,033 | | | | — | | | | 300,000 | | | | — | | | | 303,033 | | | | 5.13 | % |
| 2016 | | | 2,220 | | | | — | | | | 300,000 | | | | — | | | | 302,220 | | | | 5.50 | % |
| 2017 & thereafter | | | 1,768 | | | | — | | | | 100,000 | | | | — | | | | 101,768 | | | | 7.47 | % |
| | | | | | | | | | | | | | | | | | | |
| | | $ | 47,464 | | | $ | 138,514 | | | $ | 1,955,000 | | | $ | 246,960 | | | $ | 2,387,938 | | | | 6.55 | % |
| | | | | | | | | | | | | | | | | | | |
| | |
| (1) | | Liberty/Commerz 1701 JFK Boulevard, LP financing arrangement — see above. |
7. LEASING ACTIVITY
Future minimum rental payments due from tenants under noncancelable operating leases as of December 31, 2006 are as follows (in thousands):
| | | | | |
| 2007 | | $ | 446,997 | |
| 2008 | | | 399,549 | |
| 2009 | | | 333,841 | |
| 2010 | | | 269,376 | |
| 2011 | | | 203,081 | |
| Thereafter | | | 468,809 | |
| | | | |
| TOTAL | | $ | 2,121,653 | |
| | | | |
49
In addition to minimum rental payments, most leases require the tenants to pay for their pro rata share of specified operating expenses. These payments are included as operating expense reimbursement in the accompanying consolidated statements of operations.
8. SHAREHOLDERS’ EQUITY
Common Shares
The Company paid to holders of its common shares and holders of its common units distributions of $228.6 million, $220.8 million and $213.3 million during the years ended December 31, 2006, 2005, and 2004, respectively. On a per share basis, the Company paid Common Share and Unit distributions of $2.465, $2.445 and $2.425 during the years ended December 31, 2006, 2005, and 2004, respectively.
For federal income tax purposes, the following table summarizes the portions of the Common Share distributions relating to return of capital, ordinary income, and capital gains:
| | | | | | | | | | | | | |
| | | 2006 | | 2005 | | 2004 |
| Return of capital | | | — | | | | — | | | | 8.0 | % |
| Ordinary income | | | 66.6 | % | | | 62.8 | % | | | 87.3 | % |
| Capital gains | | | 33.4 | % | | | 37.2 | % | | | 4.7 | % |
The Company’s federal income tax returns are subject to examination by taxing authorities. Because the application of tax laws and regulations is susceptible to varying interpretations, the taxability of distributions could be changed at a later date upon final determination by taxing authorities.
Treasury Shares
The Company’s Board of Trustees authorized a share repurchase plan under which the Company may purchase up to $100 million of the Company’s Common Shares and preferred shares (as defined below).
Minority Interest
Minority interest in the accompanying consolidated financial statements represents the interests of the common and preferred units in Liberty Property Limited Partnership not held by the Trust. Minority interest is adjusted at each period end to reflect the ownership percentage of the common and preferred unitholders at that time. A minority interest reclassification occurs between minority interest and shareholders’ equity each period there is a transaction involving ownership interests in Liberty Property Limited Partnership. In addition, minority interest includes third-party ownership interests in two consolidated joint venture investments in the United Kingdom. During 2006, 684,432 common units were issued in connection with an acquisition. No common units were issued in connection with acquisitions during 2005 or 2004. The common units outstanding as of December 31, 2006 have the same economic characteristics as common shares. The 4,189,967 common units share proportionately in the net income or loss and in any distributions of the Operating Partnership and are exchangeable into the same number of common shares of the Trust.
As of December 31, 2006, the Company has 5,800,000 authorized but unissued preferred shares.
The Company has outstanding the following Cumulative Redeemable Preferred Units of the Operating Partnership, (the “Preferred Units”):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Date of | | | | | | | | | | | | | | Liquidation | | Dividend | | Redeemable | | |
| Issue | | Issue | | Amount | | Units | | Preference | | Rate | | As of | | Exchangeable after |
| | | | | | | | | (in 000’s) | | | | | | | | | | | | |
| | 7/28/99 | | | Series B | | $ | 95,000 | | | | 3,800 | | | $ | 25 | | | | 7.45 | % | | | 8/31/09 | | | 1/1/14 into Series B Cumulative Redeemable Preferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 6/10/02 | | | Series D | | $ | 23,650 | | | | 473 | | | $ | 50 | | | | 7.625 | % | | | 6/10/07 | | | 6/10/12 into Series D Cumulative Redeemable Preferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 6/16/05 | | | Series E | | $ | 20,000 | | | | 400 | | | $ | 50 | | | | 7.00 | % | | | 6/16/10 | | | 6/16/15 into Series E Cumulative Redeemable Preferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 6/30/05 | | | Series F | | $ | 44,000 | | | | 880 | | | $ | 50 | | | | 6.65 | % | �� | | 6/30/10 | | | 6/30/15 into Series F Cumulative Redeemable Preferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 8/23/05 | | | Series F | | $ | 6,000 | | | | 120 | | | $ | 50 | | | | 6.65 | % | | | 6/30/10 | | | 6/30/15 into Series F Cumulative RedeemablePreferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 12/15/06 | | | Series G | | $ | 27,000 | | | | 540 | | | $ | 50 | | | | 6.70 | % | | | 12/12/11 | | | 12/12/16 into Series G Cumulative Redeemable Preferred Shares of the Trust |
50
Effective August 31, 2004, the distribution rate on the $95 million Series B preferred units was reduced from 9.25% to 7.45%.
During the year ended December 31, 2005, the Company redeemed for $20 million its outstanding 9.125% Series C Cumulative Redeemable Preferred Units.
The Company paid the following Preferred Unit distributions for the year ended December 31:
| | | | | | | | | | | | | |
| | | 2006 | | 2005 | | 2004 |
| Distributions (in millions) | | $ | 13.7 | | | $ | 12.1 | | | $ | 11.8 | |
| Distribution per unit: | | | | | | | | | | | | |
| Series B | | $ | 1.86 | | | $ | 1.86 | | | $ | 2.16 | |
| Series C | | | — | | | $ | 1.05 | | | $ | 2.28 | |
| Series D | | $ | 3.81 | | | $ | 3.81 | | | $ | 3.81 | |
| Series E | | $ | 3.50 | | | $ | 1.90 | | | | — | |
| Series F | | $ | 3.33 | | | $ | 1.61 | | | | — | |
| Series G | | $ | 0.16 | | | | — | | | | — | |
Shareholder Rights Plan
In December 1997, the Board of Trustees of the Company adopted a shareholder rights plan (the “Shareholder Rights Plan”). Under the Shareholder Rights Plan, one Right (as defined in the Shareholder Rights Plan) was attached to each outstanding common share at the close of business on December 31, 1997. In addition, a Right will be attached to each share of common stock issued in the future. Each Right entitles the registered holder to purchase from the Company, under certain conditions, a unit (a “Rights Plan Unit”) consisting of one one-thousandth of a share of a Series A Junior Participating Preferred Share, $0.0001 par value, (the “Junior Preferred Stock”), of the Company, for $100 per Rights Plan Unit, subject to adjustment. The Rights become exercisable only if a person or group of affiliated or associated persons (an “Acquiring Person”) acquires, or obtains the right to acquire, beneficial ownership of common shares or other voting securities (“Voting Stock”) that have 10% or more of the voting power of the outstanding shares of Voting Stock, or if an Acquiring Person commences to make a tender offer or exchange offer to acquire beneficial ownership of Voting Stock that has 10% or more of the voting power of the outstanding shares of Voting Stock. The Rights are redeemable by the Company at a price of $0.0001 per Right. If not exercised or redeemed, all Rights will expire on December 31, 2007.
Dividend Reinvestment and Share Purchase Plan
The Company has a Dividend Reinvestment and Share Purchase Plan under which holders of common shares may elect to automatically reinvest their distributions in additional common shares and may make optional cash payments for additional common shares. The Company may issue additional common shares or repurchase common shares in the open market for purposes of financing its obligations under the Dividend Reinvestment and Share Purchase Plan. During the years ended December 31, 2006, 2005, and 2004, 1,297,867, 1,767,187, and 1,590,488, common shares, respectively, were issued through the Dividend Reinvestment and Share Purchase Plan. The Company used the proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.
9. EMPLOYEE BENEFIT PLANS
The Company maintains a 401(k) plan for the benefit of its full-time employees. The Company matches the employees’ contributions up to 3% of the employees’ salary and may also make annual discretionary contributions. Total 401(k) expense recognized by the Company was $940,000, $716,000 and $739,000 for the years ended 2006, 2005 and 2004 respectively.
10. SHARE BASED COMPENSATION
Options
The Company has authorized the grant of options under the Plan to executive officers, other key employees, non-employee trustees and consultants of up to 12.8 million common shares of the Company. All options granted have 10-year terms and most options vest over a 3-year period, with options to purchase up to 20% of the shares exercisable after the first anniversary, up to 50% after the second anniversary and 100% after the third anniversary of the date of grant.
Share based compensation cost related to options for the years ended December 31, 2006, 2005 and 2004 was $764,000, $616,000 and $349,000, respectively.
51
Because option awards under the Plan vest over three years, the cost related to share-based employee compensation included in the determination of net income for 2005 and 2004 is less than that which would have been recognized if the fair value based method had been applied to all option awards since the original effective date of SFAS No. 123. The following table illustrates the effect on net income and earnings per share if the fair value based method had been applied to all outstanding and unvested option awards in each period (in thousands, except per share amounts).
| | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2005 | | | 2004 | |
| Net income | | $ | 249,351 | | | $ | 161,443 | |
| | | | | | | | | |
| Add: Share-based compensation expense included in reported net income | | | 616 | | | | 349 | |
| | | | | | | | | |
| Deduct: Total share-based employee compensation expense determined under fair value based methods for all awards | | | (746 | ) | | | (1,199 | ) |
| | | | | | | |
| Pro forma net income | | $ | 249,221 | | | $ | 160,593 | |
| | | | | | | |
| | | | | | | | | |
| Net income per common share: | | | | | | | | |
| Basic — as reported | | $ | 2.87 | | | $ | 1.91 | |
| Basic — pro forma | | $ | 2.87 | | | $ | 1.90 | |
| | | | | | | | | |
| Diluted — as reported | | $ | 2.82 | | | $ | 1.88 | |
| Diluted — pro forma | | $ | 2.82 | | | $ | 1.87 | |
Pro forma disclosures are not likely to be representative of the effects on reported net income for future years because of the staggered vesting periods of the options.
The fair value of share option awards is estimated on the date of the grant using the Black-Scholes option valuation model. The following weighted-average assumptions were utilized in calculating the fair value of options granted during the periods indicated:
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
| Risk-free interest rate | | | 4.8 | % | | | 4.4 | % | | | 4.0 | % |
| Dividend yield | | | 5.8 | % | | | 5.9 | % | | | 6.2 | % |
| Volatility factor | | | 0.188 | | | | 0.184 | | | | 0.172 | |
| Weighted-average expected life | | 7 years | | 8 years | | 8 years |
A summary of the Company’s share option activity, and related information for the year ended December 31, 2006 follows:
| | | | | | | | | |
| | | | | | | Weighted | |
| | | | | | | Average | |
| | | Options | | | Exercise | |
| | | (000s) | | | Price | |
| Outstanding at January 1, 2006 | | | 3,521 | | | $ | 29.31 | |
| Granted | | | 175 | | | | 46.94 | |
| Exercised | | | (1,123 | ) | | | 26.17 | |
| Forfeited | | | (16 | ) | | | 42.55 | |
| | | | | | | |
| Outstanding at December 31, 2006 | | | 2,557 | | | $ | 31.83 | |
| | | | | | | |
| Exercisable at December 31, 2006 | | | 2,080 | | | $ | 29.07 | |
The weighted average fair value of options granted during the years ended December 31, 2006, 2005 and 2004 was $5.06, $3.86 and $3.15, respectively. Exercise prices for options outstanding as of December 31, 2006 ranged from $21.88 to $48.54. The weighted average remaining contractual life of the options outstanding and exercisable at December 31, 2006 was 5.2 years and 4.5 years, respectively.
During the years ended December 31, 2006, 2005 and 2004, the total intrinsic value of share options exercised (the difference between the market price at exercise and the price paid by the individual to exercise the option) was $23.5 million, $9.5 million and $13.7 million, respectively. As of December 31, 2006, the aggregate intrinsic value of options outstanding was $44.2 million and the aggregate intrinsic value of options exercisable was $41.7 million. The total cash received from the exercise of options for the years ended December 31, 2006, 2005 and 2004 was $29.4 million, $15.8 million and $22.0 million, respectively. The Company has historically issued new shares to satisfy share option exercises.
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As of December 31, 2006, there was $2.0 million of unrecognized compensation costs related to nonvested options granted under the Plan. That cost is expected to be recognized over a weighted average period of 1.4 years.
Long Term Incentive Shares (“LTI”)
Restricted LTI share grants made under the Plan are valued at the grant date fair value, which is the market price of the underlying common shares, and vest ratably over a 5-year period beginning with the first anniversary of the grant.
Share-based compensation cost related to restricted LTI share grants for the years ended December 31, 2006, 2005 and 2004 were $3.1 million, $2.4 million and $1.5 million, respectively.
The following table shows a summary of the Company’s restricted LTI share activity for the year ended December 31, 2006:
| | | | | | | | | |
| | | | | | | Weighted Avg | |
| | | Shares | | | Grant Date | |
| | | (000s) | | | Fair value | |
| Nonvested at January 1, 2006 | | | 253 | | | $ | 39.10 | |
| Granted | | | 78 | | | | 48.08 | |
| Vested | | | (50 | ) | | | 37.12 | |
| Forfeited | | | (10 | ) | | | 40.26 | |
| | | | | | | |
| Nonvested at December 31, 2006 | | | 271 | | | $ | 42.02 | |
| | | | | | | |
The weighted average fair value of restricted shares granted during the years ended December 31, 2006, 2005 and 2004 was $48.08 per share, $41.14 per share and $42.47 per share. As of December 31, 2006, there was $11.4 million of total unrecognized compensation cost related to nonvested shares granted under the Plan. That cost is expected to be recognized over a weighted average period of 2.3 years. The total fair value of restricted shares vested during the years ended December 31, 2006, 2005 and 2004 was $1.9 million, $1.6 million and $0.9 million, respectively.
Bonus Shares
The Plan provides that employees of the Company may elect to receive bonuses or commissions in the form of common shares in lieu of cash (“Bonus Shares”). By making such election, the employee receives shares equal to 120% of the cash value of the bonus or commission, less applicable withholding tax. Bonus Shares issued for the years ended December 31, 2006, 2005 and 2004 were 39,207, 51,055 and 38,575, respectively. Share-based compensation cost related to Bonus Shares for the years ended December 31, 2006, 2005 and 2004 was $1.9 million, $2.1 million and $1.7 million, respectively.
Profit Sharing Plan
The Plan provides that employees of the Company, below the officer level, may receive up to 5% of base pay in the form of common shares depending on Company performance. Shares issued in conjunction with the profit sharing plan for the years ended December 31, 2006, 2005 and 2004 were 3,072, 3,126 and 4,092 shares, respectively.
An additional 3,063,169, 1,935,042 and 2,309,159 common shares were reserved for issuance for future grants under the Share Incentive Plan at December 31, 2006, 2005, and 2004, respectively.
Employee Share Purchase Plan
The Company registered 750,000 common shares under the Securities Act of 1933, as amended, in connection with an employee share purchase plan (“ESPP”). The ESPP enables eligible employees to purchase shares of the Company, in amounts up to 10% of the employee’s salary, at a 15% discount to fair market value. There were 10,491, 8,814 and 9,227 shares issued, in accordance with the ESPP, during the years ended December 31, 2006, 2005 and 2004, respectively.
53
11. COMMITMENTS AND CONTINGENCIES
Substantially all of the Properties and land were subject to Phase I Environmental Assessments and when appropriate Phase II Environmental Assessments (collectively, the “Environmental Assessments”) obtained in contemplation of their acquisition by the Company. The Environmental Assessments consisted of, among other activities, a visual inspection of each Property and its neighborhood and a check of pertinent public records. The Environmental Assessments did not reveal, nor is the Company aware of, any non-compliance with environmental laws, environmental liability or other environmental claim that the Company believes would likely have a material adverse effect on the Company.
Although the Company is engaged in litigation incidental to its business, there is no legal proceeding to which it is a party which, in the opinion of management, will materially adversely affect the results of the Company’s operations.
The Company is obligated to make additional capital contributions to unconsolidated joint ventures of $1.0 million.
The Company has letter of credit obligations of $1.6 million related to development requirements.
The Company maintains cash and cash equivalents at financial institutions. The combined account balances at each institution typically exceed FDIC insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes the risk is not significant.
12. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
A summary of quarterly results of operations for the years ended December 31, 2006 and 2005 follows. Certain amounts have been reclassified to conform to the current presentation of discontinued operations (in thousands, except per share amounts).
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Quarter Ended | |
| | | Dec. 31, | | | Sept. 30, | | | June 30, | | | Mar. 31, | | | Dec. 31, | | | Sept. 30, | | | June 30, | | | Mar. 31, | |
| | | 2006 | | | 2006 | | | 2006 | | | 2006 | | | 2005 | | | 2005 | | | 2005 | | | 2005 | |
| Operating revenue | | $ | 175,702 | | | $ | 167,026 | | | $ | 163,799 | | | $ | 160,192 | | | $ | 160,517 | | | $ | 157,949 | | | $ | 162,754 | | | $ | 152,274 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Income from continuing operations | | | 36,130 | | | | 35,032 | | | | 50,800 | | | | 31,735 | | | | 102,495 | | | | 31,779 | | | | 34,788 | | | | 35,779 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Discontinued operations | | | 24,684 | | | | 11,853 | | | | 17,649 | | | | 58,691 | | | | 4,821 | | | | 20,096 | | | | 9,769 | | | | 9,824 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Income available to common shareholders | | | 60,814 | | | | 46,885 | | | | 68,449 | | | | 90,426 | | | | 107,316 | | | | 51,875 | | | | 44,557 | | | | 45,603 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Income per common share - basic (1) | | $ | 0.67 | | | $ | 0.52 | | | $ | 0.77 | | | $ | 1.02 | | | $ | 1.22 | | | $ | 0.59 | | | $ | 0.51 | | | $ | 0.53 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Income per common share - diluted (1) | | $ | 0.67 | | | $ | 0.52 | | | $ | 0.76 | | | $ | 1.01 | | | $ | 1.20 | | | $ | 0.58 | | | $ | 0.51 | | | $ | 0.52 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | |
| (1) | | The sum of quarterly financial data may vary from the annual data due to rounding. |
13. SEGMENT INFORMATION
The Company operates its portfolio of properties primarily throughout the Mid-Atlantic, Southeastern and Midwestern United States. Additionally, the Company owns certain assets in the United Kingdom. The Company reviews the performance of the portfolio on a geographical basis. As such, the following regions are considered the Company’s reportable segments:
| | | |
| Reportable Segments | | Markets |
| Delaware Valley | | Southeastern Pennsylvania; New Jersey |
| Midwest | | Lehigh Valley, Pennsylvania; Michigan; Minnesota; Milwaukee; Chicago |
| Mid-Atlantic | | Maryland; Piedmont Triad, NC; Greenville, SC; Richmond; Virginia Beach |
| Florida | | Jacksonville; Orlando; Boca Raton; Tampa; Texas |
| United Kingdom | | County of Kent |
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The Company’s reportable segments are distinct business units which are each managed separately in order to concentrate market knowledge within a geographic area. Within these reportable segments, the Company derives its revenues from its two product types: industrial properties and office properties.
The Company evaluates performance of the reportable segments based on property level operating income, which is calculated as rental revenue and operating expense reimbursement less rental property expenses and real estate taxes. The accounting policies of the reportable segments are the same as those for the Company on a consolidated basis. The operating information by segment is as follows (in thousands):
YEAR ENDED DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | Mid- | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Atlantic | | | Florida | | | Kingdom | | | Total | |
| Operating revenue | | $ | 187,817 | | | $ | 38,730 | | | $ | 85,180 | | | $ | 116,324 | | | $ | 122,014 | | | $ | 112,788 | | | $ | 3,866 | | | $ | 666,719 | |
| Rental property expenses and real estate taxes | | | 58,545 | | | | 12,718 | | | | 18,747 | | | | 42,839 | | | | 37,566 | | | | 37,428 | | | | 2,864 | | | | 210,707 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Property level operating income | | $ | 129,272 | | | $ | 26,012 | | | $ | 66,433 | | | $ | 73,485 | | | $ | 84,448 | | | $ | 75,360 | | | $ | 1,002 | | | | 456,012 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest and other income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 9,591 | |
| Interest expense | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (119,584 | ) |
| General and administrative | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (45,991 | ) |
| Depreciation and amortization | | | | | | | | | | | | (144,692 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures | | | | | | | | | | | | 155,336 | |
| Gain on property dispositions | | | | | | | | | | | | 17,628 | |
| Income taxes | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (288 | ) |
| Minority interest | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (20,411 | ) |
| Equity in earnings of unconsolidated joint ventures | | | | | | | | | | | | 1,432 | |
| Discontinued operations, net of minority interest | | | | | | | | | | | | 112,877 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 266,574 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
YEAR ENDED DECEMBER 31, 2005
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | Mid- | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Atlantic | | | Florida | | | Kingdom | | | Total | |
| Operating revenue | | $ | 187,212 | | | $ | 37,521 | | | $ | 77,219 | | | $ | 110,190 | | | $ | 104,794 | | | $ | 96,229 | | | $ | 20,329 | | | $ | 633,494 | |
| Rental property expenses and real estate taxes | | | 55,706 | | | | 13,139 | | | | 19,661 | | | | 39,878 | | | | 31,614 | | | | 31,556 | | | | 3,678 | | | | 195,232 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property level operating income | | $ | 131,506 | | | $ | 24,382 | | | $ | 57,558 | | | $ | 70,312 | | | $ | 73,180 | | | $ | 64,673 | | | $ | 16,651 | | | | 438,262 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest and other income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 8,008 | |
| Interest expense | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (119,614 | ) |
| General and administrative | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (38,099 | ) |
| Depreciation and amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | (135,846 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures | | | | | | | | | | | | 152,711 | |
| Gain on property dispositions | | | | | | | | | | | | | | | | | | | | | | | | | | | 85,593 | |
| Income taxes | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (14,827 | ) |
| Minority interest | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (21,176 | ) |
| Equity in earnings of unconsolidated joint ventures | | | | | | | | | | | | | | | | | | | | | | 2,540 | |
| Discontinued operations, net of minority interest | | | | | | | | | | | | | | | | | | | | | | 44,510 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 249,351 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
55
YEAR ENDED DECEMBER 31, 2004
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | | | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Mid-Atlantic | | | Florida | | | Kingdom | | | Total | |
| Operating revenue | | $ | 177,655 | | | $ | 32,680 | | | $ | 66,731 | | | $ | 102,824 | | | $ | 99,395 | | | $ | 86,267 | | | $ | 19,732 | | | $ | 585,284 | |
| Rental property expenses and real estate taxes | | | 51,943 | | | | 11,048 | | | | 17,087 | | | | 37,341 | | | | 26,715 | | | | 26,744 | | | | 3,166 | | | | 174,044 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property level operating income | | $ | 125,712 | | | $ | 21,632 | | | $ | 49,644 | | | $ | 65,483 | | | $ | 72,680 | | | $ | 59,523 | | | $ | 16,566 | | | | 411,240 | |
| | | | | | �� | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest and other income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6,266 | |
| Interest expense | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (107,027 | ) |
| General and administrative | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (33,724 | ) |
| Depreciation and amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | (119,934 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income before property dispositions, income taxes, minority interest and equity in loss of unconsolidated joint ventures | | | | | | | | | | | | 156,821 | |
| Gain on property dispositions | | | | | | | | | | | | | | | | | | | | | | | | | | | 496 | |
| Income taxes | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (1,820 | ) |
| Minority interest | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (17,134 | ) |
| Equity in loss of unconsolidated joint ventures | | | | | | | | | | | | | | | | | | | | | | (775 | ) |
| Discontinued operations, net of minority interest | | | | | | | | | | | | | | | | | | | | | | 23,855 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 161,443 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Product Type Information | | Real Estate Related Revenues | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
| Industrial | | $ | 284,551 | | | $ | 268,958 | | | $ | 247,379 | |
| Office | | | 382,168 | | | | 364,536 | | | | 337,905 | |
| | | | | | | | | | |
| Total operating revenue | | $ | 666,719 | | | $ | 633,494 | | | $ | 585,284 | |
| | | | | | | | | | |
ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | Mid- | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Atlantic | | | Florida | | | Kingdom | | | Total | |
| January 1, 2006 | | $ | 1,060,198 | | | $ | 183,020 | | | $ | 637,301 | | | $ | 833,618 | | | $ | 913,735 | | | $ | 646,681 | | | $ | 9,838 | | | $ | 4,284,391 | |
| Additions | | | 74,852 | | | | 36,807 | | | | 15,006 | | | | 37,853 | | | | 104,185 | | | | 275,474 | | | | 1,597 | | | | 545,774 | |
| Dispositions | | | (55,255 | ) | | | (4,422 | ) | | | (69,832 | ) | | | (91,464 | ) | | | (116,680 | ) | | | — | | | | — | | | | (337,653 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| December 31, 2006 | | $ | 1,079,795 | | | $ | 215,405 | | | $ | 582,475 | | | $ | 780,007 | | | $ | 901,240 | | | $ | 922,155 | | | $ | 11,435 | | | | 4,492,512 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Accumulated depreciation | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (806,309 | ) |
| Development in progress | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 538,303 | |
| Land held for development | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 195,332 | |
| Assets held for sale | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 40,715 | |
| Other assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 450,358 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total assets at December 31, 2006 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 4,910,911 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
56
ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | Mid- | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Atlantic | | | Florida | | | Kingdom | | | Total | |
| January 1, 2005 | | $ | 1,020,714 | | | $ | 190,116 | | | $ | 558,590 | | | $ | 746,207 | | | $ | 828,809 | | | $ | 651,123 | | | $ | 169,304 | | | $ | 4,164,863 | |
| Additions | | | 44,071 | | | | 14,857 | | | | 84,698 | | | | 114,253 | | | | 115,341 | | | | 37,772 | | | | 10,832 | | | | 421,824 | |
| Dispositions | | | (4,587 | ) | | | (21,953 | ) | | | (5,987 | ) | | | (26,842 | ) | | | (30,415 | ) | | | (42,214 | ) | | | (170,298 | ) | | | (302,296 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| December 31, 2005 | | $ | 1,060,198 | | | $ | 183,020 | | | $ | 637,301 | | | $ | 833,618 | | | $ | 913,735 | | | $ | 646,681 | | | $ | 9,838 | | | | 4,284,391 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Accumulated depreciation | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (732,439 | ) |
| Development in progress | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 324,924 | |
| Land held for development | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 158,653 | |
| Assets held for sale | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 73,211 | |
| Other assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 391,582 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total assets at December 31, 2005 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 4,500,322 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
14. SFAS NO. 144, “ACCOUNTING FOR THE IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS”
Discontinued Operations
In accordance with SFAS No. 144, the operating results and gain/(loss) on disposition of real estate for properties sold and held for sale are reflected in the consolidated statements of operations as discontinued operations. Prior year financial statements have been adjusted for discontinued operations. The proceeds from dispositions of operating properties with no continuing involvement were $395.9 million and $200.9 million for the years ended December 31, 2006 and 2005, respectively.
Below is a summary of the results of operations of the properties disposed of and held for sale through the respective disposition dates (in thousands):
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
| Revenues | | $ | 28,399 | | | $ | 60,202 | | | $ | 70,580 | |
| Operating expenses | | | (11,170 | ) | | | (20,332 | ) | | | (23,244 | ) |
| Interest expense | | | (4,662 | ) | | | (15,814 | ) | | | (17,470 | ) |
| Depreciation and amortization | | | (7,252 | ) | | | (14,374 | ) | | | (16,581 | ) |
| | | | | | | | | | |
| Income before property dispositions and minority interest | | $ | 5,315 | | | $ | 9,682 | | | $ | 13,285 | |
| | | | | | | | | | |
The held for sale properties consist of three properties totaling 352,000 square feet in the Company’s Midwest — Other segment. The properties held for sale as of December 31, 2006 were sold in January 2007.
Interest expense is allocated to discontinued operations as permitted under EITF Issue 87-24, "Allocation of Interest to Discontinued Operations,” and such interest expense has been included in computing income from discontinued operations. The allocation of interest expense to discontinued operations was based on the ratio of net assets sold (without continuing involvement) or held for sale to the sum of total net assets plus consolidated debt.
Asset Impairment
In accordance with SFAS No. 144, during the years ended December 31, 2006 and 2005, the Company recognized impairment losses of $4.2 million and $5.3 million, respectively. The 2006 impairment loss of $4.2 million was primarily related to a 352,000 square foot portfolio of operating properties in the Midwest — Other segment. The 2005 impairment loss of $5.3 million was primarily related to a portfolio of operating properties equaling 615,000 square feet in the Midwest — Other segment. For the years ended December 31, 2006 and 2005, respectively, $4.2 million and $3.7 million related to properties sold or held for sale were included in the caption discontinued operations in the Company’s statement of operations. For the years ended December 31, 2005 and 2004, respectively, $1.6 million and $1.4 million in impairments were included in the caption gain on property dispositions as a component of income from continuing operations. The Company determined these impairments through a comparison of the aggregate future cash flows (including quoted offer prices) to be generated by the properties to the carrying value of the properties. The Company has evaluated each of the properties and land held for development and has determined that there are no additional valuation adjustments necessary at December 31, 2006.
57
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | |
| | | | | | | | | Initial Cost | | | Capitalized | | | Gross Amount Carried at End of Period | | | | | Date of | | | | |
| | | | | | | | | | | | | | | | | Subsequent | | | | | | | | | | | | | | | Accumulated | | Construction | | | Depreciable | |
| | | | | | | | | | | | | | | | | to | | | Land and | | | Building and | | | Total | | | Depreciation | | or | | | life | |
| Project | | Location | | Encumbrances | | | Land | | | Building | | | Acquisition | | | Improvements | | | Improvements | | | 12/31/2006 | | | 12/31/06 | | Acquisition | | | (years) | |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 1501 Perryman Road | | Aberdeen, MD | | $ | — | | | $ | 5,813,324 | | | $ | 18,874,059 | | | $ | 3,274,480 | | | $ | 5,816,839 | | | $ | 22,145,024 | | | $ | 27,961,863 | | | $7,560 | | | 2005 | | | 40 yrs. |
| 2196 Avenue C | | Allentown, PA | | | — | | | | 101,159 | | | | — | | | | 1,347,970 | | | | 107,307 | | | | 1,341,822 | | | | 1,449,129 | | | 750,775 | | | 1980 | | | 40 yrs. |
| 2202 Hanger Place | | Allentown, PA | | | * | | | | 137,439 | | | | — | | | | 1,341,155 | | | | 138,127 | | | | 1,340,466 | | | | 1,478,594 | | | 826,310 | | | 1981 | | | 40 yrs. |
| 7437 Industrial Boulevard | | Allentown, PA | | | — | | | | 717,488 | | | | 5,022,413 | | | | 2,425,462 | | | | 726,651 | | | | 7,438,711 | | | | 8,165,362 | | | 2,459,321 | | | 1976 | | | 40 yrs. |
| 7339 Industrial Boulevard | | Allentown, PA | | | * | | | | 1,187,776 | | | | — | | | | 6,324,599 | | | | 1,197,447 | | | | 6,314,928 | | | | 7,512,376 | | | 1,930,459 | | | 1996 | | | 40 yrs. |
| 400 Nestle Way | | Allentown, PA | | | 22,630,797 | | | | 8,065,500 | | | | — | | | | 27,253,022 | | | | 8,184,096 | | | | 27,134,426 | | | | 35,318,522 | | | 7,218,734 | | | 1997 | | | 40 yrs. |
| 7248 Industrial Boulevard | | Allentown, PA | | | — | | | | 2,670,849 | | | | 13,307,408 | | | | 1,101,923 | | | | 2,670,673 | | | | 14,409,506 | | | | 17,080,179 | | | 3,732,710 | | | 1988 | | | 40 yrs. |
| 700 Nestle Way | | Allentown, PA | | | — | | | | 3,473,120 | | | | — | | | | 18,116,440 | | | | 4,174,970 | | | | 17,414,590 | | | | 21,589,560 | | | 4,014,467 | | | 1998 | | | 40 yrs. |
| 7562 Penn Drive | | Allentown, PA | | | — | | | | 269,614 | | | | 844,069 | | | | 184,443 | | | | 269,614 | | | | 1,028,512 | | | | 1,298,126 | | | 259,319 | | | 1989 | | | 40 yrs. |
| 7277 Williams Avenue | | Allentown, PA | | | — | | | | 462,964 | | | | 1,449,009 | | | | 322,599 | | | | 463,123 | | | | 1,771,449 | | | | 2,234,572 | | | 538,729 | | | 1989 | | | 40 yrs. |
| 7355 Williams Avenue | | Allentown, PA | | | — | | | | 489,749 | | | | 1,658,091 | | | | 304,958 | | | | 489,749 | | | | 1,963,049 | | | | 2,452,798 | | | 465,129 | | | 1998 | | | 40 yrs. |
| 794 Roble Road | | Allentown, PA | | | — | | | | 1,147,541 | | | | 6,088,041 | | | | 1,125,815 | | | | 1,147,541 | | | | 7,213,857 | | | | 8,361,398 | | | 1,802,850 | | | 1985 | | | 40 yrs. |
| 6923 Schantz Spring Road | | Allentown, PA | | | * | | | | 1,127,805 | | | | 3,309,132 | | | | 348,419 | | | | 1,127,805 | | | | 3,657,551 | | | | 4,785,355 | | | 839,583 | | | 1993 | | | 40 yrs. |
| 7132 Daniels Drive | | Allentown, PA | | | — | | | | 1,623,326 | | | | 3,464,626 | | | | 4,174,016 | | | | 1,695,610 | | | | 7,566,357 | | | | 9,261,967 | | | 1,576,367 | | | 1988 | | | 40 yrs. |
| 8014 Industrial Boulevard | | Allentown, PA | | | — | | | | 4,019,258 | | | | — | | | | 9,446,162 | | | | 3,645,117 | | | | 9,820,303 | | | | 13,465,420 | | | 2,218,246 | | | 1999 | | | 40 yrs. |
| 705 Boulder Drive | | Allentown, PA | | | — | | | | 4,484,096 | | | | — | | | | 14,878,034 | | | | 4,486,836 | | | | 14,875,294 | | | | 19,362,130 | | | 2,387,484 | | | 2001 | | | 40 yrs. |
| 651 Boulder Drive | | Allentown, PA | | | * | | | | 4,308,646 | | | | — | | | | 13,284,432 | | | | 4,308,646 | | | | 13,284,432 | | | | 17,593,078 | | | 2,467,753 | | | 2000 | | | 40 yrs. |
| 8150 Industrial Boulevard | | Allentown, PA | | | — | | | | 2,564,167 | | | | — | | | | 8,906,845 | | | | 2,571,466 | | | | 8,899,547 | | | | 11,471,013 | | | 1,421,039 | | | 2002 | | | 40 yrs. |
| 8250 Industrial Boulevard | | Allentown, PA | | | — | | | | 1,025,667 | | | | — | | | | 5,346,179 | | | | 1,035,854 | | | | 5,335,991 | | | | 6,371,846 | | | 633,244 | | | 2002 | | | 40 yrs. |
| 650 Boulder Drive | | Allentown, PA | | | — | | | | 5,208,248 | | | | — | | | | 31,404,856 | | | | 9,961,788 | | | | 26,651,316 | | | | 36,613,104 | | | 2,728,758 | | | 2002 | | | 40 yrs. |
| 7165 Ambassador Drive | | Allentown, PA | | | * | | | | 792,999 | | | | — | | | | 4,533,868 | | | | 804,848 | | | | 4,522,019 | | | | 5,326,867 | | | 586,086 | | | 2002 | | | 40 yrs. |
| 200 Boulder Drive | | Allentown, PA | | | — | | | | 4,722,683 | | | | 18,922,645 | | | | 240,929 | | | | 4,722,683 | | | | 19,163,574 | | | | 23,886,258 | | | 1,081,207 | | | 2004 | | | 40 yrs. |
| 250 Boulder Drive | | Allentown, PA | | | — | | | | 3,623,328 | | | | 12,099,145 | | | | 1,144,216 | | | | 3,719,772 | | | | 13,146,917 | | | | 16,866,689 | | | 690,330 | | | 2004 | | | 40 yrs. |
| 6560 Stonegate Drive | | Allentown, PA | | | — | | | | 458,281 | | | | — | | | | 2,839,996 | | | | 458,945 | | | | 2,839,332 | | | | 3,298,277 | | | 1,116,992 | | | 1989 | | | 40 yrs. |
| 6370 Hedgewood Drive | | Allentown, PA | | | — | | | | 540,795 | | | | — | | | | 3,608,143 | | | | 541,459 | | | | 3,607,479 | | | | 4,148,938 | | | 1,356,701 | | | 1990 | | | 40 yrs. |
| 6390 Hedgewood Drive | | Allentown, PA | | | — | | | | 707,203 | | | | — | | | | 2,765,090 | | | | 707,867 | | | | 2,764,425 | | | | 3,472,293 | | | 1,317,332 | | | 1990 | | | 40 yrs. |
| 6350 Hedgewood Drive | | Allentown, PA | | | * | | | | 360,027 | | | | — | | | | 3,470,090 | | | | 560,691 | | | | 3,269,426 | | | | 3,830,117 | | | 1,390,438 | | | 1989 | | | 40 yrs. |
| 6330 Hedgewood Drive | | Allentown, PA | | | — | | | | 531,268 | | | | — | | | | 4,910,864 | | | | 532,047 | | | | 4,910,085 | | | | 5,442,132 | | | 2,333,532 | | | 1988 | | | 40 yrs. |
| 6580 Snowdrift Road | | Allentown, PA | | | — | | | | 388,328 | | | | — | | | | 3,284,907 | | | | 389,081 | | | | 3,284,155 | | | | 3,673,235 | | | 1,459,264 | | | 1988 | | | 40 yrs. |
| 6540 Stonegate Drive | | Allentown, PA | | | — | | | | 422,042 | | | | — | | | | 3,893,307 | | | | 422,730 | | | | 3,892,620 | | | | 4,315,349 | | | 1,829,429 | | | 1988 | | | 40 yrs. |
| 974 Marcon Boulevard | | Allentown, PA | | | — | | | | 143,500 | | | | — | | | | 2,469,917 | | | | 144,248 | | | | 2,469,170 | | | | 2,613,417 | | | 1,308,676 | | | 1987 | | | 40 yrs. |
| 964 Marcon Boulevard | | Allentown, PA | | | — | | | | 138,816 | | | | — | | | | 1,983,002 | | | | 139,480 | | | | 1,982,338 | | | | 2,121,818 | | | 913,043 | | | 1985 | | | 40 yrs. |
| 764 Roble Road | | Allentown, PA | | | — | | | | 141,069 | | | | — | | | | 864,405 | | | | 141,746 | | | | 863,728 | | | | 1,005,474 | | | 446,399 | | | 1985 | | | 40 yrs. |
| 3174 Airport Road | | Allentown, PA | | | — | | | | 98,986 | | | | — | | | | 1,157,004 | | | | 98,986 | | | | 1,157,004 | | | | 1,255,990 | | | 727,271 | | | 1979 | | | 40 yrs. |
| 2201 Hanger Place | | Allentown, PA | | | — | | | | 128,454 | | | | — | | | | 1,906,472 | | | | 129,142 | | | | 1,905,783 | | | | 2,034,926 | | | 1,121,868 | | | 1987 | | | 40 yrs. |
| 954 Marcon Boulevard | | Allentown, PA | | | — | | | | 103,665 | | | | — | | | | 1,110,937 | | | | 104,453 | | | | 1,110,149 | | | | 1,214,602 | | | 586,982 | | | 1981 | | | 40 yrs. |
| 754 Roble Road | | Allentown, PA | | | — | | | | 162,115 | | | | 1,731,885 | | | | 279,310 | | | | 163,735 | | | | 2,009,575 | | | | 2,173,310 | | | 677,125 | | | 1986 | | | 40 yrs. |
| 744 Roble Road | | Allentown, PA | | | — | | | | 159,771 | | | | 1,734,229 | | | | 266,454 | | | | 161,371 | | | | 1,999,083 | | | | 2,160,454 | | | 663,735 | | | 1986 | | | 40 yrs. |
| 944 Marcon Boulevard | | Allentown, PA | | | — | | | | 118,521 | | | | 1,435,479 | | | | 464,628 | | | | 119,711 | | | | 1,898,917 | | | | 2,018,628 | | | 633,568 | | | 1986 | | | 40 yrs. |
| 6520 Stonegate Drive | | Allentown, PA | | | — | | | | 453,315 | | | | — | | | | 1,787,903 | | | | 484,361 | | | | 1,756,857 | | | | 2,241,218 | | | 593,896 | | | 1996 | | | 40 yrs. |
| 2041 Avenue C | | Allentown, PA | | | — | | | | 213,599 | | | | 1,095,217 | | | | 83,135 | | | | 213,879 | | | | 1,178,072 | | | | 1,391,951 | | | 353,869 | | | 1990 | | | 40 yrs. |
| 7144 Daniels Drive | | Allentown, PA | | | — | | | | 2,390,217 | | | | 2,342,761 | | | | 3,721,684 | | | | 1,579,169 | | | | 6,875,493 | | | | 8,454,662 | | | 1,849,083 | | | 1975 | | | 40 yrs. |
| 7620 Cetronia Road | | Allentown, PA | | | — | | | | 1,091,806 | | | | 3,851,456 | | | | 356,371 | | | | 1,093,724 | | | | 4,205,910 | | | | 5,299,633 | | | 1,364,080 | | | 1990 | | | 40 yrs. |
| 180,190 Cochrane Drive | | Annapolis, MD | | | — | | | | 3,670,256 | | | | — | | | | 22,322,825 | | | | 3,752,293 | | | | 22,240,788 | | | | 25,993,081 | | | 8,676,942 | | | 1988 | | | 40 yrs. |
| 4606 Richlynn Drive | | Belcamp, MD | | | — | | | | 299,600 | | | | 1,818,861 | | | | 712,787 | | | | 299,600 | | | | 2,531,649 | | | | 2,831,249 | | | 470,711 | | | 1985 | | | 40 yrs. |
| 41199 Van Born Road | | Bellville, MI | | | — | | | | 1,829,396 | | | | 6,765,015 | | | | 509,937 | | | | 1,829,396 | | | | 7,274,952 | | | | 9,104,347 | | | 5,269 | | | 2005 | | | 40 yrs. |
| 41133 Van Born Road | | Bellville, MI | | | — | | | | 1,829,560 | | | | 6,454,755 | | | | 463,975 | | | | 1,829,560 | | | | 6,918,730 | | | | 8,748,290 | | | 5,877 | | | 2005 | | | 40 yrs. |
| 1655 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 214,431 | | | | — | | | | 2,019,753 | | | | 215,095 | | | | 2,019,088 | | | | 2,234,184 | | | 935,846 | | | 1993 | | | 40 yrs. |
| 1455 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 670,290 | | | | — | | | | 3,743,118 | | | | 545,172 | | | | 3,868,235 | | | | 4,413,408 | | | 1,742,880 | | | 1997 | | | 40 yrs. |
| 1640 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 359,000 | | | | — | | | | 2,538,675 | | | | 190,728 | | | | 2,706,947 | | | | 2,897,675 | | | 1,142,900 | | | 1996 | | | 40 yrs. |
| 1650 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 359,000 | | | | — | | | | 2,215,932 | | | | 188,896 | | | | 2,386,036 | | | | 2,574,932 | | | 942,344 | | | 1997 | | | 40 yrs. |
| 1660 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 359,000 | | | | — | | | | 2,278,206 | | | | 188,721 | | | | 2,448,485 | | | | 2,637,206 | | | 737,276 | | | 1998 | | | 40 yrs. |
| 83 South Commerce Way | | Bethlehem, PA | | | — | | | | 143,661 | | | | 888,128 | | | | 520,095 | | | | 212,744 | | | | 1,339,140 | | | | 1,551,884 | | | 521,859 | | | 1989 | | | 40 yrs. |
| 85 South Commerce Way | | Bethlehem, PA | | | — | | | | 236,708 | | | | 987,949 | | | | 169,265 | | | | 237,078 | | | | 1,156,844 | | | | 1,393,922 | | | 312,464 | | | 1989 | | | 40 yrs. |
| 87 South Commerce Way | | Bethlehem, PA | | | — | | | | 253,886 | | | | 1,062,881 | | | | 223,146 | | | | 253,886 | | | | 1,286,027 | | | | 1,539,913 | | | 383,776 | | | 1989 | | | 40 yrs. |
| 89 South Commerce Way | | Bethlehem, PA | | | — | | | | 320,000 | | | | — | | | | 2,011,186 | | | | 367,706 | | | | 1,963,481 | | | | 2,331,186 | | | 701,530 | | | 1998 | | | 40 yrs. |
| 1525 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 475,686 | | | | — | | | | 7,721,312 | | | | 804,104 | | | | 7,392,894 | | | | 8,196,998 | | | 1,900,307 | | | 1999 | | | 40 yrs. |
| 74 West Broad Street | | Bethlehem, PA | | | — | | | | 1,096,127 | | | | — | | | | 13,371,415 | | | | 1,099,079 | | | | 13,368,463 | | | | 14,467,542 | | | 2,582,086 | | | 2002 | | | 40 yrs. |
| 1605 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 729,751 | | | | — | | | | 11,065,717 | | | | 1,766,196 | | | | 10,029,272 | | | | 11,795,468 | | | 1,779,914 | | | 2000 | | | 40 yrs. |
| 3400 High Point Boulevard | | Bethlehem, PA | | | — | | | | 298,227 | | | | — | | | | 3,053,506 | | | | 662,809 | | | | 2,688,924 | | | | 3,351,733 | | | 367,073 | | | 2002 | | | 40 yrs. |
| 1495 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 434,640 | | | | — | | | | 4,695,697 | | | | 435,303 | | | | 4,695,034 | | | | 5,130,337 | | | 1,544,454 | | | 1990 | | | 40 yrs. |
| 1550 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 196,954 | | | | — | | | | 3,827,587 | | | | 197,700 | | | | 3,826,842 | | | | 4,024,541 | | | 1,470,951 | | | 1988 | | | 40 yrs. |
| 1560 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 240,069 | | | | — | | | | 4,638,646 | | | | 240,732 | | | | 4,637,983 | | | | 4,878,715 | | | 2,078,924 | | | 1988 | | | 40 yrs. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | |
| | | | | | | | | Initial Cost | | | Capitalized | | | Gross Amount Carried at End of Period | | | | | Date of | | | | |
| | | | | | | | | | | | | | | | | Subsequent | | | | | | | | | | | | | | | Accumulated | | Construction | | | Depreciable | |
| | | | | | | | | | | | | | | | | to | | | Land and | | | Building and | | | Total | | | Depreciation | | or | | | life | |
| Project | | Location | | Encumbrances | | | Land | | | Building | | | Acquisition | | | Improvements | | | Improvements | | | 12/31/2006 | | | 12/31/06 | | Acquisition | | | (years) | |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 1510 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 312,209 | | | | — | | | | 3,762,171 | | | | 312,873 | | | | 3,761,507 | | | | 4,074,380 | | | 1,704,910 | | | 1988 | | | 40 yrs. |
| 1530 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 211,747 | | | | — | | | | 3,008,631 | | | | 212,492 | | | | 3,007,886 | | | | 3,220,378 | | | 1,256,732 | | | 1988 | | | 40 yrs. |
| 57 South Commerce Way | | Bethlehem, PA | | | — | | | | 390,839 | | | | 2,701,161 | | | | 764,168 | | | | 395,459 | | | | 3,460,709 | | | | 3,856,168 | | | 1,189,140 | | | 1986 | | | 40 yrs. |
| 1685 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 244,029 | | | | — | | | | 2,283,047 | | | | 198,482 | | | | 2,328,594 | | | | 2,527,076 | | | 838,903 | | | 1996 | | | 40 yrs. |
| 6601-6625 W. 78th Street | | Bloomington, MN | | | — | | | | 2,263,060 | | | | — | | | | 38,629,236 | | | | 2,310,246 | | | | 38,582,050 | | | | 40,892,296 | | | 7,893,682 | | | 1998 | | | 40 yrs. |
| 4801 West 81st Street | | Bloomington, MN | | | — | | | | 1,624,701 | | | | 2,494,368 | | | | 809,469 | | | | 1,624,701 | | | | 3,303,836 | | | | 4,928,537 | | | 864,938 | | | 1984 | | | 40 yrs. |
| 8100 Cedar Avenue | | Bloomington, MN | | | — | | | | 501,313 | | | | 3,675,416 | | | | 971,824 | | | | 501,313 | | | | 4,647,240 | | | | 5,148,553 | | | 1,214,704 | | | 1983 | | | 40 yrs. |
| 6161 Green Valley Drive | | Bloomington, MN | | | — | | | | 740,378 | | | | 3,311,602 | | | | 732,919 | | | | 741,194 | | | | 4,043,704 | | | | 4,784,898 | | | 745,201 | | | 1992 | | | 40 yrs. |
| 10801 Nesbitt Avenue South | | Bloomington, MN | | | — | | | | 784,577 | | | | — | | | | 4,105,182 | | | | 786,382 | | | | 4,103,377 | | | | 4,889,759 | | | 944,251 | | | 2001 | | | 40 yrs. |
| 5775 West Old Shakopee Road | | Bloomington, MN | | | — | | | | 2,052,018 | | | | 3,849,649 | | | | 3,311,678 | | | | 2,060,644 | | | | 7,152,700 | | | | 9,213,345 | | | 2,366,472 | | | 2002 | | | 40 yrs. |
| 5715 Old Shakopee Road West | | Bloomington, MN | | | — | | | | 1,263,226 | | | | 2,360,782 | | | | 1,954,672 | | | | 1,264,758 | | | | 4,313,922 | | | | 5,578,680 | | | 810,571 | | | 2002 | | | 40 yrs. |
| 5735 Old Shakopee Road West | | Bloomington, MN | | | — | | | | 1,263,226 | | | | 2,360,782 | | | | 1,089,640 | | | | 1,264,758 | | | | 3,448,890 | | | | 4,713,648 | | | 447,722 | | | 2002 | | | 40 yrs. |
| 1701 Clint Moore Boulevard | | Boca Raton, FL | | | — | | | | 1,430,884 | | | | 3,043,553 | | | | 1,302,089 | | | | 1,430,937 | | | | 4,345,589 | | | | 5,776,526 | | | 839,133 | | | 1985 | | | 40 yrs. |
| 951 Broken Sound Parkway | | Boca Raton, FL | | | — | | | | 1,426,251 | | | | 6,098,952 | | | | 1,234,056 | | | | 1,426,251 | | | | 7,333,008 | | | | 8,759,259 | | | 2,037,449 | | | 1986 | | | 40 yrs. |
| 777 Yamato Road | | Boca Raton, FL | | | — | | | | 4,101,247 | | | | 16,077,347 | | | | 4,498,115 | | | | 4,501,247 | | | | 20,175,462 | | | | 24,676,709 | | | 5,014,867 | | | 1987 | | | 40 yrs. |
| 1801 Clint Moore Road | | Boca Raton, FL | | | — | | | | 1,065,068 | | | | 4,481,644 | | | | 640,426 | | | | 1,065,068 | | | | 5,122,070 | | | | 6,187,139 | | | 1,249,779 | | | 1986 | | | 40 yrs. |
| 400 Boulder Drive | | Breinigsville, PA | | | * | | | | — | | | | — | | | | 13,376,989 | | | | 2,865,575 | | | | 10,511,414 | | | | 13,376,989 | | | 629,760 | | | 2003 | | | 40 yrs. |
| 860 Nestle Way | | Breinigsville, PA | | | — | | | | 8,118,881 | | | | 18,885,486 | | | | 1,403,042 | | | | 8,118,881 | | | | 20,288,528 | | | | 28,407,408 | | | 671,096 | | | 2004 | | | 40 yrs. |
| 602 Heron Drive | | Bridgeport, NJ | | | — | | | | 524,728 | | | | 2,240,478 | | | | 7,650 | | | | 524,728 | | | | 2,248,128 | | | | 2,772,856 | | | 491,389 | | | 1996 | | | 40 yrs. |
| 245 Executive Drive | | Brookfield, WI | | | — | | | | 577,067 | | | | 5,197,903 | | | | 3,816,157 | | | | 577,067 | | | | 9,014,060 | | | | 9,591,127 | | | 1,549,221 | | | 1984 | | | 40 yrs. |
| 16620-16650 W Bluemound Road | | Brookfield, WI | | | — | | | | 586,665 | | | | 4,289,907 | | | | 828,882 | | | | 586,665 | | | | 5,118,789 | | | | 5,705,454 | | | 984,048 | | | 1999 | | | 40 yrs. |
| 15800 West Bluemound Road | | Brookfield, WI | | | — | | | | 1,289,204 | | | | 8,128,035 | | | | 948,664 | | | | 1,306,811 | | | | 9,059,092 | | | | 10,365,903 | | | 1,391,720 | | | 1994 | | | 40 yrs. |
| 20700 Swenson Drive | | Brookfield, WI | | | 12,858,381 | | | | 830,008 | | | | 12,276,445 | | | | 478,954 | | | | 830,999 | | | | 12,754,408 | | | | 13,585,406 | | | 429,906 | | | 2005 | | | 40 yrs. |
| 20800 Swenson Drive | | Brookfield, WI | | | — | | | | 1,023,466 | | | | 10,729,219 | | | | 418,157 | | | | 1,025,082 | | | | 11,145,759 | | | | 12,170,841 | | | 474,180 | | | 2005 | | | 40 yrs. |
| 20935 Swenson Drive | | Brookfield, WI | | | 5,295,966 | | | | 571,389 | | | | 10,238,547 | | | | 658,028 | | | | 572,158 | | | | 10,895,806 | | | | 11,467,963 | | | 391,207 | | | 2005 | | | 40 yrs. |
| 20975 Swenson Drive | | Brookfield, WI | | | 7,584,291 | | | | 675,422 | | | | 8,910,651 | | | | 602,016 | | | | 678,637 | | | | 9,509,452 | | | | 10,188,089 | | | 398,554 | | | 2005 | | | 40 yrs. |
| 20825 Swenson Drive | | Brookfield, WI | | | — | | | | 644,563 | | | | 3,640,734 | | | | 64,858 | | | | 646,518 | | | | 3,703,639 | | | | 4,350,156 | | | 111,258 | | | 2006 | | | 40 yrs. |
| 1485 W. Commerce Avenue | | Carlisle, PA | | | — | | | | 4,249,868 | | | | 13,886,039 | | | | 173,427 | | | | 4,253,027 | | | | 14,056,308 | | | | 18,309,335 | | | 699,441 | | | 2004 | | | 40 yrs. |
| 3773 Corporate Parkway | | Center Valley, PA | | | — | | | | 738,108 | | | | — | | | | 7,605,349 | | | | 794,874 | | | | 7,548,583 | | | | 8,343,457 | | | 1,666,953 | | | 2001 | | | 40 yrs. |
| 1309 Executive Boulevard | | Cheaspeake, VA | | | — | | | | 926,125 | | | | — | | | | 5,086,632 | | | | 955,374 | | | | 5,057,383 | | | | 6,012,757 | | | 733,464 | | | 2001 | | | 40 yrs. |
| 7 Carnegie Plaza | | Cherry Hill, NJ | | | * | | | | 2,000,000 | | | | 3,493,983 | | | | 3,217,287 | | | | 2,005,475 | | | | 6,705,794 | | | | 8,711,270 | | | 543,140 | | | 2004 | | | 40 yrs. |
| 1305 Executive Boulevard | | Chesapeake, VA | | | — | | | | 861,020 | | | | — | | | | 4,878,062 | | | | 1,129,850 | | | | 4,609,232 | | | | 5,739,082 | | | 691,749 | | | 2002 | | | 40 yrs. |
| 1313 Executive Boulevard | | Chesapeake, VA | | | — | | | | 1,180,036 | | | | — | | | | 4,629,615 | | | | 1,708,050 | | | | 4,101,602 | | | | 5,809,652 | | | 554,643 | | | 2002 | | | 40 yrs. |
| 500 Independence Parkway | | Chesapeake, VA | | | 3,588,914 | | | | 864,150 | | | | 4,427,285 | | | | 66,501 | | | | 866,609 | | | | 4,491,328 | | | | 5,357,937 | | | 352,536 | | | 2004 | | | 40 yrs. |
| 700 Independence Parkway | | Chesapeake, VA | | | 6,903,981 | | | | 1,950,375 | | | | 8,273,910 | | | | (614,501 | ) | | | 1,951,135 | | | | 7,658,648 | | | | 9,609,783 | | | 650,222 | | | 2004 | | | 40 yrs. |
| 501 Independence Parkway | | Chesapeake, VA | | | 4,967,909 | | | | 1,202,556 | | | | 5,975,538 | | | | 1,185,556 | | | | 1,292,273 | | | | 7,071,376 | | | | 8,363,650 | | | 336,396 | | | 2005 | | | 40 yrs. |
| 505 Independence Parkway | | Chesapeake, VA | | | 5,793,893 | | | | 1,292,062 | | | | 6,456,515 | | | | 1,141,115 | | | | 1,292,254 | | | | 7,597,437 | | | | 8,889,691 | | | 380,615 | | | 2005 | | | 40 yrs. |
| 510 Independence Parkway | | Chesapeake, VA | | | — | | | | 2,012,149 | | | | 7,546,882 | | | | 394,344 | | | | 2,014,689 | | | | 7,938,686 | | | | 9,953,375 | | | 422,930 | | | 2005 | | | 40 yrs. |
| 1301 Executive Boulevard | | Chesapeake, VA | | | — | | | | — | | | | — | | | | 6,113,029 | | | | 997,570 | | | | 5,115,459 | | | | 6,113,029 | | | 108,314 | | | 2005 | | | 40 yrs. |
| 600 H P Way | | Chester, VA | | | — | | | | 146,126 | | | | — | | | | 6,429,625 | | | | 501,752 | | | | 6,073,999 | | | | 6,575,751 | | | 1,193,352 | | | 1997 | | | 40 yrs. |
| 500 H P Way | | Chester, VA | | | — | | | | 142,692 | | | | — | | | | 5,563,992 | | | | 491,919 | | | | 5,214,765 | | | | 5,706,684 | | | 1,090,627 | | | 1997 | | | 40 yrs. |
| 6230 Old Dobbin Lane | | Colombia, MD | | | — | | | | 3,004,075 | | | | — | | | | 7,729,322 | | | | 2,746,455 | | | | 7,986,942 | | | | 10,733,397 | | | 161,577 | | | 2004 | | | 40 yrs. |
| 9101,9111,9115 Guilford Road | | Columbia, MD | | | — | | | | 758,951 | | | | — | | | | 3,519,455 | | | | 765,952 | | | | 3,512,453 | | | | 4,278,406 | | | 1,941,815 | | | 1984 | | | 40 yrs. |
| 9125,9135,9145 Guilford Road | | Columbia, MD | | | — | | | | 900,154 | | | | — | | | | 5,815,495 | | | | 920,439 | | | | 5,795,210 | | | | 6,715,649 | | | 3,426,185 | | | 1983 | | | 40 yrs. |
| 7178-80 Columbia Gateway | | Columbia, MD | | | — | | | | 1,569,237 | | | | 4,786,887 | | | | 1,836,281 | | | | 1,571,105 | | | | 6,621,299 | | | | 8,192,405 | | | 2,215,458 | | | 1987 | | | 40 yrs. |
| 9770 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 341,663 | | | | 3,033,309 | | | | 907,405 | | | | 341,663 | | | | 3,940,714 | | | | 4,282,377 | | | 791,142 | | | 1986 | | | 40 yrs. |
| 9780 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 218,542 | | | | 1,940,636 | | | | 125,207 | | | | 218,542 | | | | 2,065,843 | | | | 2,284,384 | | | 504,644 | | | 1986 | | | 40 yrs. |
| 9790 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 243,791 | | | | 2,164,094 | | | | 223,402 | | | | 243,791 | | | | 2,387,496 | | | | 2,631,287 | | | 669,572 | | | 1986 | | | 40 yrs. |
| 9810 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 266,684 | | | | 2,366,901 | | | | 644,582 | | | | 266,684 | | | | 3,011,483 | | | | 3,278,167 | | | 794,236 | | | 1986 | | | 40 yrs. |
| 9800 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 299,099 | | | | 2,654,069 | | | | 531,960 | | | | 299,099 | | | | 3,186,029 | | | | 3,485,129 | | | 815,523 | | | 1988 | | | 40 yrs. |
| 9820 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 237,779 | | | | 2,110,835 | | | | 711,722 | | | | 237,779 | | | | 2,822,557 | | | | 3,060,336 | | | 569,893 | | | 1988 | | | 40 yrs. |
| 9830 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 296,262 | | | | 2,628,933 | | | | 143,928 | | | | 296,262 | | | | 2,772,861 | | | | 3,069,124 | | | 717,517 | | | 1986 | | | 40 yrs. |
| 9050 Red Branch Road | | Columbia, MD | | | — | | | | 290,950 | | | | 2,577,153 | | | | 802,675 | | | | 290,950 | | | | 3,379,828 | | | | 3,670,778 | | | 720,137 | | | 1972 | | | 40 yrs. |
| 8945-8975 Guilford Road | | Columbia, MD | | | — | | | | 2,428,795 | | | | 7,493,740 | | | | 873,148 | | | | 2,427,065 | | | | 8,368,619 | | | | 10,795,684 | | | 1,959,626 | | | 1986 | | | 40 yrs. |
| 6250 Old Dobbin Lane | | Columbia, MD | | | — | | | | 958,105 | | | | — | | | | 3,590,872 | | | | 1,295,000 | | | | 3,253,978 | | | | 4,548,978 | | | 602,208 | | | 2002 | | | 40 yrs. |
| 6200 Old Dobbin Lane | | Columbia, MD | | | — | | | | 958,105 | | | | — | | | | 3,736,325 | | | | 1,295,000 | | | | 3,399,431 | | | | 4,694,431 | | | 532,591 | | | 2002 | | | 40 yrs. |
| 6210 Old Dobbin Lane | | Columbia, MD | | | — | | | | 958,105 | | | | — | | | | 3,724,707 | | | | 1,307,300 | | | | 3,375,513 | | | | 4,682,813 | | | 622,557 | | | 2002 | | | 40 yrs. |
| 6250 Old Dobbin Lane | | Columbia, MD | | | — | | | | 958,105 | | | | — | | | | 3,780,749 | | | | 1,599,259 | | | | 3,139,595 | | | | 4,738,854 | | | 349,799 | | | 2000 | | | 40 yrs. |
| 5950 Symphony Woods Road | | Columbia, MD | | | — | | | | 1,462,762 | | | | 11,310,187 | | | | 1,368,440 | | | | 1,467,623 | | | | 12,673,767 | | | | 14,141,389 | | | 1,845,734 | | | 1986 | | | 40 yrs. |
| 9755 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 3,917,094 | | | | 16,219,721 | | | | 110,510 | | | | 3,922,382 | | | | 16,324,943 | | | | 20,247,324 | | | — | | | 2006 | | | 40 yrs. |
| 5150 International Drive | | Cudahy, WI | | | — | | | | 739,673 | | | | 5,108,025 | | | | 250,327 | | | | 741,858 | | | | 5,356,167 | | | | 6,098,024 | | | 420,347 | | | 2003 | | | 40 yrs. |
| 1250 Hall Court | | Deer Park, TX | | | 3,063,690 | | | | 829,570 | | | | 4,778,327 | | | | — | | | | 829,570 | | | | 4,778,327 | | | | 5,607,897 | | | 8,813 | | | 2006 | | | 40 yrs. |
| 170 Parkway West | | Duncan, SC | | | — | | | | 598,348 | | | | 3,643,756 | | | | 68,364 | | | | 598,918 | | | | 3,711,550 | | | | 4,310,468 | | | 86,944 | | | 2006 | | | 40 yrs. |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 190 Parkway West | | Duncan, SC | | | — | | | | 551,663 | | | | 3,463,858 | | | | 34,737 | | | | 552,211 | | | | 3,498,047 | | | | 4,050,258 | | | | 95,141 | | | 2006 | | 40 yrs. |
| 265 Parkway East | | Duncan, SC | | | — | | | | 901,444 | | | | 5,751,389 | | | | 18,391 | | | | 902,374 | | | | 5,768,850 | | | | 6,671,224 | | | | 174,266 | | | 2006 | | 40 yrs. |
| 285 Parkway East | | Duncan, SC | | | — | | | | 975,433 | | | | 6,149,465 | | | | 23,682 | | | | 976,393 | | | | 6,172,187 | | | | 7,148,580 | | | | 313,732 | | | 2006 | | 40 yrs. |
| 3255 Neil Armstrong Boulevard | | Eagan, MN | | | — | | | | 1,131,017 | | | | — | | | | 3,393,423 | | | | 1,131,017 | | | | 3,393,423 | | | | 4,524,441 | | | | 677,048 | | | 1998 | | 40 yrs. |
| 6321-6325 Bury Drive | | Eden Prairie, MN | | | — | | | | 462,876 | | | | 4,151,790 | | | | 317,011 | | | | 462,876 | | | | 4,468,801 | | | | 4,931,677 | | | | 1,213,996 | | | 1988 | | 40 yrs. |
| 7660-7716 Golden Triangle Drive | | Eden Prairie, MN | | | — | | | | 568,706 | | | | 5,115,177 | | | | 2,817,841 | | | | 1,289,215 | | | | 7,212,509 | | | | 8,501,724 | | | | 2,440,957 | | | 1988 | | 40 yrs. |
| 7400 Flying Cloud Drive | | Eden Prairie, MN | | | — | | | | 195,982 | | | | 1,762,027 | | | | 157,281 | | | | 195,982 | | | | 1,919,309 | | | | 2,115,290 | | | | 441,713 | | | 1987 | | 40 yrs. |
| 10301-10305 West 70th Street | | Eden Prairie, MN | | | — | | | | 120,622 | | | | 1,085,226 | | | | 121,763 | | | | 118,300 | | | | 1,209,311 | | | | 1,327,611 | | | | 304,525 | | | 1984 | | 40 yrs. |
| 10321 West 70th Street | | Eden Prairie, MN | | | — | | | | 145,198 | | | | 1,305,700 | | | | 369,479 | | | | 142,399 | | | | 1,677,978 | | | | 1,820,377 | | | | 479,554 | | | 1984 | | 40 yrs. |
| 10333 West 70th Street | | Eden Prairie, MN | | | — | | | | 110,746 | | | | 995,868 | | | | 90,782 | | | | 108,610 | | | | 1,088,786 | | | | 1,197,396 | | | | 257,962 | | | 1984 | | 40 yrs. |
| 10349-10357 West 70th Street | | Eden Prairie, MN | | | — | | | | 275,903 | | | | 2,481,666 | | | | 584,392 | | | | 270,584 | | | | 3,071,377 | | | | 3,341,961 | | | | 737,188 | | | 1985 | | 40 yrs. |
| 10365-10375 West 70th Street | | Eden Prairie, MN | | | — | | | | 291,077 | | | | 2,618,194 | | | | 506,997 | | | | 285,464 | | | | 3,130,804 | | | | 3,416,267 | | | | 756,087 | | | 1985 | | 40 yrs. |
| 10393-10394 West 70th Street | | Eden Prairie, MN | | | — | | | | 269,618 | | | | 2,423,318 | | | | 775,855 | | | | 264,419 | | | | 3,204,372 | | | | 3,468,791 | | | | 761,414 | | | 1985 | | 40 yrs. |
| 7078 Shady Oak Road | | Eden Prairie, MN | | | — | | | | 343,093 | | | | 3,085,795 | | | | 217,201 | | | | 336,481 | | | | 3,309,608 | | | | 3,646,089 | | | | 790,055 | | | 1985 | | 40 yrs. |
| 10400 Viking Drive | | Eden Prairie, MN | | | — | | | | 2,912,391 | | | | — | | | | 22,843,159 | | | | 2,938,372 | | | | 22,817,178 | | | | 25,755,550 | | | | 5,724,688 | | | 1999 | | 40 yrs. |
| 7695-7699 Anagram Drive | | Eden Prairie, MN | | | — | | | | 760,525 | | | | 3,254,758 | | | | 605,146 | | | | 760,525 | | | | 3,859,903 | | | | 4,620,429 | | | | 843,591 | | | 1997 | | 40 yrs. |
| 7800 Equitable Drive | | Eden Prairie, MN | | | — | | | | 2,188,525 | | | | 3,788,762 | | | | 179,519 | | | | 2,188,525 | | | | 3,968,281 | | | | 6,156,806 | | | | 841,929 | | | 1993 | | 40 yrs. |
| 7905 Fuller Road | | Eden Prairie, MN | | | — | | | | 1,229,862 | | | | 4,075,167 | | | | 33,365 | | | | 1,230,965 | | | | 4,107,430 | | | | 5,338,395 | | | | 833,068 | | | 1994 | | 40 yrs. |
| 9023 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,956,273 | | | | — | | | | 4,873,578 | | | | 1,956,273 | | | | 4,873,578 | | | | 6,829,851 | | | | 1,058,231 | | | 1999 | | 40 yrs. |
| 8967 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,450,000 | | | | — | | | | 3,575,107 | | | | 1,450,000 | | | | 3,575,107 | | | | 5,025,107 | | | | 717,864 | | | 2000 | | 40 yrs. |
| 7777 Golden Triangle Drive | | Eden Prairie, MN | | | — | | | | 993,101 | | | | 2,136,862 | | | | 1,191,303 | | | | 993,101 | | | | 3,328,165 | | | | 4,321,266 | | | | 542,633 | | | 2000 | | 40 yrs. |
| 8937 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,325,829 | | | | — | | | | 4,287,274 | | | | 1,739,966 | | | | 3,873,137 | | | | 5,613,103 | | | | 676,755 | | | 2001 | | 40 yrs. |
| 7615 Smetana Lane | | Eden Prairie, MN | | | — | | | | 1,011,517 | | | | — | | | | 8,665,025 | | | | 3,000,555 | | | | 6,675,988 | | | | 9,676,542 | | | | 1,378,155 | | | 2001 | | 40 yrs. |
| 8995 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,087,594 | | | | — | | | | 3,664,053 | | | | 2,055,296 | | | | 2,696,352 | | | | 4,751,648 | | | | 429,638 | | | 2001 | | 40 yrs. |
| 8911 Columbine Road (B2) | | Eden Prairie, MN | | | — | | | | 916,687 | | | | — | | | | 3,608,469 | | | | 1,718,407 | | | | 2,806,748 | | | | 4,525,156 | | | | 377,488 | | | 2000 | | 40 yrs. |
| 8855 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,400,925 | | | | — | | | | 5,226,016 | | | | 1,599,757 | | | | 5,027,185 | | | | 6,626,941 | | | | 325,388 | | | 2000 | | 40 yrs. |
| 27260 Haggerty Road | | Farmington Hills, MI | | | — | | | | 456,877 | | | | 4,091,196 | | | | 754,780 | | | | 456,877 | | | | 4,845,977 | | | | 5,302,854 | | | | 1,273,497 | | | 1983 | | 40 yrs. |
| 27200 Haggerty Road | | Farmington Hills, MI | | | — | | | | 382,754 | | | | 3,425,227 | | | | 363,784 | | | | 382,754 | | | | 3,789,011 | | | | 4,171,765 | | | | 1,043,115 | | | 1983 | | 40 yrs. |
| 27280 Haggerty Road | | Farmington Hills, MI | | | — | | | | 452,860 | | | | 4,055,512 | | | | 443,764 | | | | 452,860 | | | | 4,499,276 | | | | 4,952,136 | | | | 1,150,855 | | | 1983 | | 40 yrs. |
| 27220 Haggerty Road | | Farmington Hills, MI | | | — | | | | 203,064 | | | | 1,802,592 | | | | 174,777 | | | | 203,064 | | | | 1,977,369 | | | | 2,180,433 | | | | 530,662 | | | 1985 | | 40 yrs. |
| 27240 Haggerty Road | | Farmington Hills, MI | | | — | | | | 171,518 | | | | 1,518,192 | | | | 280,526 | | | | 171,518 | | | | 1,798,718 | | | | 1,970,236 | | | | 445,822 | | | 1985 | | 40 yrs. |
| 27300 Haggerty Road | | Farmington Hills, MI | | | — | | | | 370,378 | | | | 3,311,366 | | | | 732,514 | | | | 370,378 | | | | 4,043,880 | | | | 4,414,259 | | | | 967,017 | | | 1985 | | 40 yrs. |
| 26442-26450 Haggerty Road | | Farmington Hills, MI | | | — | | | | 237,687 | | | | 2,143,478 | | | | 152,517 | | | | 237,691 | | | | 2,295,991 | | | | 2,533,682 | | | | 534,548 | | | 1988 | | 40 yrs. |
| 26500 Haggerty Road | | Farmington Hills, MI | | | — | | | | 311,093 | | | | 2,791,804 | | | | 433,388 | | | | 311,097 | | | | 3,225,188 | | | | 3,536,285 | | | | 737,282 | | | 1986 | | 40 yrs. |
| 26650 Haggerty Road | | Farmington Hills, MI | | | — | | | | 173,166 | | | | 1,562,704 | | | | 143,228 | | | | 173,170 | | | | 1,705,928 | | | | 1,879,098 | | | | 378,883 | | | 1988 | | 40 yrs. |
| 26700 Haggerty Road | | Farmington Hills, MI | | | — | | | | 253,338 | | | | 2,290,696 | | | | 104,078 | | | | 253,341 | | | | 2,394,770 | | | | 2,648,112 | | | | 542,406 | | | 1986 | | 40 yrs. |
| 26750 Haggerty Road | | Farmington Hills, MI | | | — | | | | 292,717 | | | | 2,638,688 | | | | 250,110 | | | | 292,720 | | | | 2,888,795 | | | | 3,181,515 | | | | 750,106 | | | 1988 | | 40 yrs. |
| 26800 Haggerty Road | | Farmington Hills, MI | | | — | | | | 175,489 | | | | 1,583,362 | | | | 243,691 | | | | 175,492 | | | | 1,827,050 | | | | 2,002,542 | | | | 500,064 | | | 1986 | | 40 yrs. |
| 26842-26850 Haggerty Road | | Farmington Hills, MI | | | — | | | | 239,606 | | | | 2,160,470 | | | | 364,314 | | | | 239,609 | | | | 2,524,781 | | | | 2,764,390 | | | | 707,486 | | | 1988 | | 40 yrs. |
| 26600 Haggerty Road | | Farmington Hills, MI | | | — | | | | 455,846 | | | | — | | | | 2,921,972 | | | | 537,693 | | | | 2,840,125 | | | | 3,377,818 | | | | 819,672 | | | 1999 | | 40 yrs. |
| 26550 Haggerty Road | | Farmington Hills, MI | | | — | | | | 368,083 | | | | — | | | | 2,647,709 | | | | 535,179 | | | | 2,480,613 | | | | 3,015,792 | | | | 658,542 | | | 2000 | | 40 yrs. |
| 7028 Snowdrift Road | | Fogelville, PA | | | — | | | | 520,473 | | | | 959,279 | | | | 262,203 | | | | 524,390 | | | | 1,217,565 | | | | 1,741,954 | | | | 292,366 | | | 1982 | | 40 yrs. |
| 420 Delaware Drive | | Fort Washington, PA | | | — | | | | 2,766,931 | | | | — | | | | 8,814,580 | | | | 2,823,257 | | | | 8,758,255 | | | | 11,581,511 | | | | 49,754 | | | 2005 | | 40 yrs. |
| 414 Commerce Drive | | Fort Washington, PA | | | — | | | | 1,267,194 | | | | 2,217,460 | | | | 177,437 | | | | 1,267,937 | | | | 2,394,153 | | | | 3,662,091 | | | | 63,339 | | | 2004 | | 40 yrs. |
| 275 Commerce Drive | | Fort Washington, PA | | | — | | | | 1,775,894 | | | | 2,160,855 | | | | 1,870,359 | | | | 1,789,302 | | | | 4,017,806 | | | | 5,807,108 | | | | — | | | 2005 | | 40 yrs. |
| 1250 Virginia Drive | | Fort Washington, PA | | | — | | | | 1,639,166 | | | | 1,928,574 | | | | 422,241 | | | | 1,650,703 | | | | 2,339,278 | | | | 3,989,980 | | | | 23,113 | | | 2005 | | 40 yrs. |
| 1100 Virginia Drive | | Fort Washington, PA | | | — | | | | 13,007,509 | | | | 11,480,744 | | | | 53,906 | | | | 13,035,013 | | | | 11,507,146 | | | | 24,542,159 | | | | 197,270 | | | 2006 | | 40 yrs. |
| 106 Southchase Boulevard | | Fountain Inn, SC | | | — | | | | 201,944 | | | | — | | | | 5,133,389 | | | | 684,003 | | | | 4,651,330 | | | | 5,335,333 | | | | 125,941 | | | 2005 | | 40 yrs. |
| 9601 Cosner Drive | | Fredericksburg, VA | | | — | | | | 475,262 | | | | 3,917,234 | | | | 214,221 | | | | 475,262 | | | | 4,131,454 | | | | 4,606,716 | | | | 1,177,660 | | | 1995 | | 40 yrs. |
| 200 W Cypress Creek Road | | Ft Lauderdale, FL | | | — | | | | 3,414,989 | | | | 2,399,738 | | | | 9,866,832 | | | | 3,414,989 | | | | 12,266,571 | | | | 15,681,559 | | | | 452,897 | | | 2003 | | 40 yrs. |
| 5410 - 5430 Northwest 33rd Avenue | | Ft. Lauderdale, FL | | | — | | | | 603,776 | | | | 4,176,238 | | | | 1,101,013 | | | | 625,111 | | | | 5,255,916 | | | | 5,881,027 | | | | 1,288,523 | | | 1985 | | 40 yrs. |
| 6500 NW 12th Avenue | | Ft. Lauderdale, FL | | | — | | | | 7,099 | | | | 3,046,309 | | | | 438,216 | | | | — | | | | 3,491,624 | | | | 3,491,624 | | | | 884,615 | | | 1989 | | 40 yrs. |
| 6600 NW 12th Avenue | | Ft. Lauderdale, FL | | | — | | | | 7,102 | | | | 3,047,462 | | | | 486,427 | | | | — | | | | 3,540,992 | | | | 3,540,992 | | | | 912,641 | | | 1989 | | 40 yrs. |
| 4880 Cox Road | | Glen Allen, VA | | | — | | | | 743,898 | | | | 4,499,807 | | | | 2,746,479 | | | | 743,898 | | | | 7,246,286 | | | | 7,990,184 | | | | 1,217,434 | | | 1995 | | 40 yrs. |
| 5000 Cox Road | | Glen Allen, VA | | | — | | | | 770,214 | | | | 3,685,248 | | | | 185,433 | | | | 771,029 | | | | 3,869,867 | | | | 4,640,895 | | | | 1,080,246 | | | 1990 | | 40 yrs. |
| 5500 Cox Road | | Glen Allen, VA | | | — | | | | 443,485 | | | | — | | | | 3,347,885 | | | | 483,263 | | | | 3,308,107 | | | | 3,791,370 | | | | 793,756 | | | 1999 | | 40 yrs. |
| 4801 Cox Road | | Glen Allen, VA | | | — | | | | 1,072,896 | | | | — | | | | 10,197,775 | | | | 1,075,620 | | | | 10,195,051 | | | | 11,270,671 | | | | 2,394,924 | | | 1998 | | 40 yrs. |
| 4198 Cox Road | | Glen Allen, VA | | | — | | | | 670,292 | | | | 3,839,245 | | | | 981,346 | | | | 670,292 | | | | 4,820,591 | | | | 5,490,883 | | | | 1,290,221 | | | 1984 | | 40 yrs. |
| 4510 Cox Road | | Glen Allen, VA | | | — | | | | 1,010,024 | | | | 7,151,729 | | | | 1,751,122 | | | | 1,010,044 | | | | 8,902,831 | | | | 9,912,875 | | | | 2,447,991 | | | 1990 | | 40 yrs. |
| 4121 Cox Road | | Glen Allen, VA | | | — | | | | 1,083,006 | | | | 6,035,653 | | | | 519,164 | | | | 1,083,006 | | | | 6,554,817 | | | | 7,637,824 | | | | 436,918 | | | 2004 | | 40 yrs. |
| 420 Park Avenue | | Greenville, SC | | | * | | | | 522,548 | | | | 2,730,261 | | | | 977,573 | | | | 522,548 | | | | 3,707,834 | | | | 4,230,382 | | | | 1,096,196 | | | 1986 | | 40 yrs. |
| One Independence Pointe | | Greenville, SC | | | — | | | | 780,881 | | | | 6,199,230 | | | | 6,430,871 | | | | 784,617 | | | | 12,626,365 | | | | 13,410,982 | | | | 2,240,553 | | | 1982 | | 40 yrs. |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 15 Brendan Way | | Greenville, SC | | | — | | | | 614,192 | | | | 3,012,019 | | | | 1,767,666 | | | | 614,192 | | | | 4,779,684 | | | | 5,393,876 | | | | 1,424,079 | | | 1988 | | 40 yrs. |
| 4 Independence Pointe | | Greenville, SC | | | — | | | | — | | | | — | | | | 3,555,776 | | | | 467,438 | | | | 3,088,339 | | | | 3,555,776 | | | | 587,548 | | | 2002 | | 40 yrs. |
| 5 Independence Pointe | | Greenville, SC | | | — | | | | — | | | | — | | | | 3,286,804 | | | | 467,438 | | | | 2,819,366 | | | | 3,286,804 | | | | 616,674 | | | 2002 | | 40 yrs. |
| 200 Southchase Boulevard | | Greenville, SC | | | — | | | | 512,911 | | | | — | | | | 6,273,615 | | | | 515,542 | | | | 6,270,984 | | | | 6,786,525 | | | | 478,893 | | | 2003 | | 40 yrs. |
| 6 Independence Pointe | | Greenville, SC | | | — | | | | — | | | | — | | | | 3,061,966 | | | | 545,698 | | | | 2,516,268 | | | | 3,061,966 | | | | 195,504 | | | 2003 | | 40 yrs. |
| 2 Independence Point | | Greenville, SC | | | — | | | | 371,600 | | | | — | | | | 3,168,228 | | | | 682,881 | | | | 2,856,946 | | | | 3,539,828 | | | | 30,935 | | | 2005 | | 40 yrs. |
| 1 Enterprise Parkway | | Hampton, VA | | | — | | | | 974,675 | | | | 5,579,869 | | | | 1,182,175 | | | | 974,675 | | | | 6,762,044 | | | | 7,736,719 | | | | 1,737,849 | | | 1987 | | 40 yrs. |
| 22 Enterprise Parkway | | Hampton, VA | | | — | | | | 1,097,368 | | | | 6,760,778 | | | | 856,086 | | | | 1,097,368 | | | | 7,616,864 | | | | 8,714,232 | | | | 2,061,113 | | | 1990 | | 40 yrs. |
| 5 Manhattan Square | | Hampton, VA | | | — | | | | 207,368 | | | | — | | | | 1,663,695 | | | | 212,694 | | | | 1,658,368 | | | | 1,871,063 | | | | 428,848 | | | 1999 | | 40 yrs. |
| 21 Enterprise Parkway | | Hampton, VA | | | 383,605 | | | | 263,668 | | | | 8,167,118 | | | | 511,240 | | | | 265,719 | | | | 8,676,307 | | | | 8,942,026 | | | | 1,386,213 | | | 1999 | | 40 yrs. |
| 521 Butler Farm Road | | Hampton, VA | | | — | | | | 750,769 | | | | 2,911,149 | | | | 260,815 | | | | 710,486 | | | | 3,212,247 | | | | 3,922,733 | | | | 264,018 | | | 2003 | | 40 yrs. |
| 7317 Parkway Drive | | Hanover, MD | | | — | | | | 1,104,359 | | | | 1,959,671 | | | | 79,319 | | | | 1,104,359 | | | | 2,038,990 | | | | 3,143,349 | | | | 453,669 | | | 1983 | | 40 yrs. |
| 500 McCarthy Drive | | Harrisburg, PA | | | — | | | | 5,194,872 | | | | 19,991,436 | | | | 4,120,570 | | | | 5,687,013 | | | | 23,619,865 | | | | 29,306,878 | | | | 1,197,404 | | | 2005 | | 40 yrs. |
| 4170 Mendenhall Oaks Parkway | | High Point , NC | | | — | | | | 143,699 | | | | — | | | | 2,210,943 | | | | 373,502 | | | | 1,981,140 | | | | 2,354,642 | | | | 543,603 | | | 1999 | | 40 yrs. |
| 4180 Mendenhall Oaks Parkway | | High Point , NC | | | — | | | | 121,329 | | | | — | | | | 1,836,257 | | | | 315,614 | | | | 1,641,972 | | | | 1,957,586 | | | | 506,298 | | | 1999 | | 40 yrs. |
| 4050 Piedmont Parkway | | High Point , NC | | | — | | | | 801,902 | | | | — | | | | 19,610,267 | | | | 2,042,159 | | | | 18,370,011 | | | | 20,412,169 | | | | 3,868,705 | | | 1998 | | 40 yrs. |
| 4523 Green Point Drive | | High Point, NC | | | — | | | | 234,564 | | | | — | | | | 2,404,561 | | | | 235,698 | | | | 2,403,427 | | | | 2,639,125 | | | | 1,058,454 | | | 1988 | | 40 yrs. |
| 4501 Green Point Drive | | High Point, NC | | | — | | | | 319,289 | | | | — | | | | 2,630,880 | | | | 320,450 | | | | 2,629,719 | | | | 2,950,169 | | | | 1,156,811 | | | 1989 | | 40 yrs. |
| 4500 Green Point Drive | | High Point, NC | | | — | | | | 230,622 | | | | — | | | | 2,333,337 | | | | 231,692 | | | | 2,332,268 | | | | 2,563,959 | | | | 1,087,232 | | | 1989 | | 40 yrs. |
| 2427 Penny Road | | High Point, NC | | | — | | | | 1,165,664 | | | | — | | | | 3,467,001 | | | | 655,240 | | | | 3,977,424 | | | | 4,632,665 | | | | 1,593,141 | | | 1990 | | 40 yrs. |
| 4524 Green Point Drive | | High Point, NC | | | — | | | | 182,810 | | | | — | | | | 2,364,005 | | | | 183,888 | | | | 2,362,926 | | | | 2,546,815 | | | | 1,039,384 | | | 1989 | | 40 yrs. |
| 4328, 4336 Federal Drive | | High Point, NC | | | 4,545,898 | | | | 521,122 | | | | — | | | | 7,238,387 | | | | 825,092 | | | | 6,934,416 | | | | 7,759,509 | | | | 3,316,305 | | | 1995 | | 40 yrs. |
| 4344 Federal Drive | | High Point, NC | | | — | | | | 484,001 | | | | — | | | | 2,755,206 | | | | 173,623 | | | | 3,065,585 | | | | 3,239,208 | | | | 1,019,455 | | | 1996 | | 40 yrs. |
| 4000 Piedmont Parkway | | High Point, NC | | | — | | | | 592,885 | | | | 4,825,615 | | | | 807,718 | | | | 597,368 | | | | 5,628,850 | | | | 6,226,218 | | | | 1,733,031 | | | 1989 | | 40 yrs. |
| 4380 Federal Drive | | High Point, NC | | | — | | | | 282,996 | | | | — | | | | 2,210,549 | | | | 283,368 | | | | 2,210,177 | | | | 2,493,545 | | | | 727,018 | | | 1997 | | 40 yrs. |
| 4388 Federal Drive | | High Point, NC | | | — | | | | 143,661 | | | | — | | | | 1,225,791 | | | | 132,655 | | | | 1,236,797 | | | | 1,369,452 | | | | 430,335 | | | 1997 | | 40 yrs. |
| 4160 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 285,882 | | | | — | | | | 3,351,586 | | | | 545,627 | | | | 3,091,841 | | | | 3,637,468 | | | | 725,642 | | | 1998 | | 40 yrs. |
| 4194 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 102,372 | | | | — | | | | 2,598,532 | | | | 265,991 | | | | 2,434,913 | | | | 2,700,904 | | | | 647,095 | | | 1999 | | 40 yrs. |
| 4196 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 66,731 | | | | — | | | | 2,250,342 | | | | 173,889 | | | | 2,143,184 | | | | 2,317,073 | | | | 709,040 | | | 1999 | | 40 yrs. |
| 4300 Federal Drive | | High Point, NC | | | — | | | | 264,038 | | | | — | | | | 2,090,460 | | | | 276,038 | | | | 2,078,460 | | | | 2,354,498 | | | | 367,817 | | | 1998 | | 40 yrs. |
| 4135 Mendenall Oaks Parkway | | High Point, NC | | | — | | | | 499,500 | | | | — | | | | 3,052,846 | | | | 500,980 | | | | 3,051,365 | | | | 3,552,346 | | | | 563,934 | | | 2000 | | 40 yrs. |
| 4183 Eagle Hill Drive | | High Point, NC | | | — | | | | 122,203 | | | | — | | | | 3,748,139 | | | | 526,266 | | | | 3,344,076 | | | | 3,870,342 | | | | 1,096,678 | | | 2001 | | 40 yrs. |
| 4189 Eagle Hill Drive | | High Point, NC | | | — | | | | 100,106 | | | | — | | | | 3,430,702 | | | | 431,106 | | | | 3,099,702 | | | | 3,530,808 | | | | 723,686 | | | 2001 | | 40 yrs. |
| 4020 Meeting Way | | High Point, NC | | | — | | | | 94,232 | | | | — | | | | 1,682,699 | | | | 378,101 | | | | 1,398,830 | | | | 1,776,931 | | | | 313,939 | | | 2001 | | 40 yrs. |
| 1400 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 172,320 | | | | — | | | | 7,145,926 | | | | 984,672 | | | | 6,333,574 | | | | 7,318,246 | | | | 1,020,098 | | | 2002 | | 40 yrs. |
| 4191 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 217,943 | | | | — | | | | 3,119,682 | | | | 611,166 | | | | 2,726,459 | | | | 3,337,625 | | | | 422,224 | | | 2002 | | 40 yrs. |
| 4015 Meeting Way | | High Point, NC | | | — | | | | 510,000 | | | | — | | | | 2,792,495 | | | | 511,869 | | | | 2,790,626 | | | | 3,302,495 | | | | 141,901 | | | 2003 | | 40 yrs. |
| 4195 Eagle Hill Drive | | High Point, NC | | | — | | | | 107,586 | | | | — | | | | 3,349,592 | | | | 505,700 | | | | 2,951,478 | | | | 3,457,178 | | | | 120,322 | | | 2004 | | 40 yrs. |
| 400 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | — | | | | — | | | | 1,860,213 | | | | 665,239 | | | | 1,194,974 | | | | 1,860,213 | | | | 14,800 | | | 2004 | | 40 yrs. |
| 100 Witmer Road | | Horsham, PA | | | 5,804,315 | | | | 3,102,784 | | | | — | | | | 11,902,626 | | | | 3,764,784 | | | | 11,240,627 | | | | 15,005,410 | | | | 2,877,003 | | | 1996 | | 40 yrs. |
| 132 Welsh Road | | Horsham, PA | | | — | | | | 1,333,642 | | | | — | | | | 4,219,965 | | | | 1,408,041 | | | | 4,145,566 | | | | 5,553,607 | | | | 1,331,664 | | | 1998 | | 40 yrs. |
| 300 Welsh Road — Building 3 | | Horsham, PA | | | — | | | | 180,459 | | | | 1,441,473 | | | | 358,107 | | | | 180,459 | | | | 1,799,579 | | | | 1,980,038 | | | | 566,487 | | | 1983 | | 40 yrs. |
| 300 Welsh Road — Building 4 | | Horsham, PA | | | — | | | | 282,493 | | | | 2,256,508 | | | | 1,347,544 | | | | 282,493 | | | | 3,604,051 | | | | 3,886,545 | | | | 1,094,113 | | | 1983 | | 40 yrs. |
| 2 Walnut Grove Drive | | Horsham, PA | | | — | | | | 1,281,870 | | | | 7,767,374 | | | | 1,614,038 | | | | 1,265,363 | | | | 9,397,919 | | | | 10,663,282 | | | | 2,775,835 | | | 1989 | | 40 yrs. |
| 5 Walnut Grove Drive | | Horsham, PA | | | — | | | | 1,065,951 | | | | — | | | | 9,658,857 | | | | 1,939,712 | | | | 8,785,096 | | | | 10,724,809 | | | | 1,749,887 | | | 2000 | | 40 yrs. |
| 200 Gibraltar Road | | Horsham, PA | | | — | | | | 638,513 | | | | 5,811,323 | | | | 1,627,733 | | | | 638,513 | | | | 7,439,056 | | | | 8,077,569 | | | | 2,202,723 | | | 1990 | | 40 yrs. |
| 220 Gibraltar Road | | Horsham, PA | | | — | | | | 629,944 | | | | 5,733,228 | | | | 1,201,778 | | | | 629,944 | | | | 6,935,006 | | | | 7,564,950 | | | | 2,143,096 | | | 1990 | | 40 yrs. |
| 240 Gibraltar Road | | Horsham, PA | | | — | | | | 629,944 | | | | 5,733,234 | | | | 1,578,115 | | | | 629,944 | | | | 7,311,349 | | | | 7,941,293 | | | | 2,295,152 | | | 1990 | | 40 yrs. |
| 1 Walnut Grove Drive | | Horsham, PA | | | — | | | | 1,058,901 | | | | 5,343,606 | | | | 1,041,557 | | | | 1,058,901 | | | | 6,385,163 | | | | 7,444,064 | | | | 2,059,580 | | | 1986 | | 40 yrs. |
| 181-187 Gibraltar Road | | Horsham, PA | | | — | | | | 360,549 | | | | 3,259,984 | | | | 506,596 | | | | 360,549 | | | | 3,766,580 | | | | 4,127,129 | | | | 1,094,203 | | | 1982 | | 40 yrs. |
| 104 Rock Road | | Horsham, PA | | | — | | | | 330,111 | | | | 2,981,669 | | | | 233,299 | | | | 330,111 | | | | 3,214,968 | | | | 3,545,079 | | | | 705,425 | | | 1974 | | 40 yrs. |
| 123-135 Rock Road | | Horsham, PA | | | — | | | | 292,360 | | | | 2,411,677 | | | | 871,555 | | | | 393,019 | | | | 3,182,573 | | | | 3,575,591 | | | | 970,834 | | | 1975 | | 40 yrs. |
| 111-159 Gibraltar Road | | Horsham, PA | | | — | | | | 489,032 | | | | 4,126,151 | | | | 613,296 | | | | 489,032 | | | | 4,739,447 | | | | 5,228,479 | | | | 1,272,980 | | | 1981 | | 40 yrs. |
| 161-175 Gibraltar Road | | Horsham, PA | | | — | | | | 294,673 | | | | 2,663,722 | | | | 987,299 | | | | 294,673 | | | | 3,651,020 | | | | 3,945,694 | | | | 856,934 | | | 1976 | | 40 yrs. |
| 103-109 Gibraltar Road | | Horsham, PA | | | — | | | | 270,906 | | | | 2,448,500 | | | | 795,126 | | | | 270,906 | | | | 3,243,625 | | | | 3,514,531 | | | | 1,044,383 | | | 1978 | | 40 yrs. |
| 261-283 Gibraltar Road | | Horsham, PA | | | * | | | | 464,871 | | | | 3,951,972 | | | | 141,841 | | | | 464,871 | | | | 4,093,813 | | | | 4,558,684 | | | | 942,660 | | | 1978 | | 40 yrs. |
| 210-223 Witmer Road | | Horsham, PA | | | — | | | | 270,282 | | | | 2,441,276 | | | | 1,761,333 | | | | 270,282 | | | | 4,202,609 | | | | 4,472,891 | | | | 959,764 | | | 1972 | | 40 yrs. |
| 231-237 Gibraltar Road | | Horsham, PA | | | * | | | | 436,952 | | | | 3,948,963 | | | | 699,674 | | | | 436,952 | | | | 4,648,636 | | | | 5,085,589 | | | | 1,155,695 | | | 1981 | | 40 yrs. |
| 100 Gibraltar Road | | Horsham, PA | | | — | | | | 38,729 | | | | 349,811 | | | | 9,589 | | | | 38,729 | | | | 359,400 | | | | 398,129 | | | | 81,406 | | | 1975 | | 40 yrs. |
| 101 Gibraltar Road | | Horsham, PA | | | — | | | | 651,990 | | | | 5,888,989 | | | | 1,376,885 | | | | 732,552 | | | | 7,185,312 | | | | 7,917,864 | | | | 1,741,900 | | | 1977 | | 40 yrs. |
| 506 Prudential Road | | Horsham, PA | | | — | | | | 208,140 | | | | 895,470 | | | | 652,633 | | | | 208,140 | | | | 1,548,102 | | | | 1,756,243 | | | | 357,080 | | | 1973 | | 40 yrs. |
| 113-123 Rock Road | | Horsham, PA | | | — | | | | 351,072 | | | | 3,171,001 | | | | 334,495 | | | | 451,731 | | | | 3,404,836 | | | | 3,856,568 | | | | 823,288 | | | 1975 | | 40 yrs. |
| 101-111 Rock Road | | Horsham, PA | | | — | | | | 350,561 | | | | 3,166,389 | | | | 640,212 | | | | 452,251 | | | | 3,704,911 | | | | 4,157,162 | | | | 892,449 | | | 1975 | | 40 yrs. |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 120 Gibraltar Road | | Horsham, PA | | | — | | | | 533,142 | | | | 4,830,515 | | | | 973,788 | | | | 558,142 | | | | 5,779,303 | | | | 6,337,445 | | | | 1,392,610 | | | 1980 | | 40 yrs. |
| 110 Gibraltar Road | | Horsham, PA | | | — | | | | 673,041 | | | | 5,776,369 | | | | 2,170,108 | | | | 673,041 | | | | 7,946,477 | | | | 8,619,518 | | | | 1,938,777 | | | 1979 | | 40 yrs. |
| 100-107 Lakeside Drive | | Horsham, PA | | | — | | | | 239,528 | | | | 2,163,498 | | | | 659,861 | | | | 255,528 | | | | 2,807,359 | | | | 3,062,887 | | | | 844,384 | | | 1982 | | 40 yrs. |
| 200-264 Lakeside Drive | | Horsham, PA | | | — | | | | 502,705 | | | | 4,540,597 | | | | 915,265 | | | | 502,705 | | | | 5,455,862 | | | | 5,958,567 | | | | 1,609,702 | | | 1982 | | 40 yrs. |
| 300-309 Lakeside Drive | | Horsham, PA | | | — | | | | 369,475 | | | | 3,338,761 | | | | 1,710,844 | | | | 376,475 | | | | 5,042,605 | | | | 5,419,080 | | | | 1,681,475 | | | 1982 | | 40 yrs. |
| 400-445 Lakeside Drive | | Horsham, PA | | | — | | | | 543,628 | | | | 4,910,226 | | | | 2,760,384 | | | | 583,628 | | | | 7,630,610 | | | | 8,214,238 | | | | 2,059,164 | | | 1981 | | 40 yrs. |
| 104 Witmer Road | | Horsham, PA | | | * | | | | 1,248,148 | | | | — | | | | 1,133,479 | | | | 189,793 | | | | 2,191,834 | | | | 2,381,627 | | | | 735,818 | | | 1975 | | 40 yrs. |
| 201 Gibraltar Road | | Horsham, PA | | | — | | | | 380,127 | | | | 3,433,433 | | | | 1,997,494 | | | | 380,802 | | | | 5,430,252 | | | | 5,811,054 | | | | 1,285,924 | | | 1983 | | 40 yrs. |
| 719 Dresher Road | | Horsham, PA | | | * | | | | 493,426 | | | | 2,812,067 | | | | 205,125 | | | | 495,112 | | | | 3,015,506 | | | | 3,510,618 | | | | 669,434 | | | 1987 | | 40 yrs. |
| 4 Walnut Grove | | Horsham, PA | | | * | | | | 2,515,115 | | | | — | | | | 7,329,299 | | | | 2,515,115 | | | | 7,329,299 | | | | 9,844,415 | | | | 1,405,252 | | | 1999 | | 40 yrs. |
| 300 Welsh Road | | Horsham, PA | | | — | | | | 696,061 | | | | 3,339,991 | | | | 547,772 | | | | 696,061 | | | | 3,887,762 | | | | 4,583,823 | | | | 866,821 | | | 1985 | | 40 yrs. |
| 700 Dresher Road | | Horsham, PA | | | — | | | | 2,551,777 | | | | 3,020,638 | | | | 4,641,908 | | | | 2,565,140 | | | | 7,649,183 | | | | 10,214,323 | | | | 3,175,714 | | | 1987 | | 40 yrs. |
| 680 Blair Mill Road | | Horsham, PA | | | — | | | | 3,527,151 | | | | — | | | | 12,039,009 | | | | 4,138,577 | | | | 11,427,583 | | | | 15,566,160 | | | | 2,583,511 | | | 2001 | | 40 yrs. |
| 102 Rock Road | | Horsham, PA | | | — | | | | 1,110,209 | | | | 2,301,302 | | | | 1,133,191 | | | | 1,114,985 | | | | 3,429,717 | | | | 4,544,702 | | | | 474,800 | | | 1985 | | 40 yrs. |
| 335 Commerce Drive | | Horsham, PA | | | — | | | | — | | | | — | | | | 8,736,456 | | | | 182,400 | | | | 8,554,056 | | | | 8,736,456 | | | | 470,505 | | | 2002 | | 40 yrs. |
| 255 Business Center Drive | | Horsham, PA | | | — | | | | 1,086,356 | | | | 2,007,214 | | | | 496,797 | | | | 1,078,769 | | | | 2,511,597 | | | | 3,590,366 | | | | 206,020 | | | 2003 | | 40 yrs. |
| 355 Business Center Drive | | Horsham, PA | | | — | | | | 483,045 | | | | 898,798 | | | | 275,266 | | | | 479,200 | | | | 1,177,910 | | | | 1,657,110 | | | | 129,780 | | | 2003 | | 40 yrs. |
| 455 Business Center Drive | | Horsham, PA | | | — | | | | 1,351,011 | | | | 2,503,449 | | | | 1,668,600 | | | | 1,343,370 | | | | 4,179,690 | | | | 5,523,060 | | | | 548,149 | | | 2003 | | 40 yrs. |
| 555 Business Center Drive | | Horsham, PA | | | — | | | | 727,420 | | | | 1,353,650 | | | | 213,228 | | | | 723,016 | | | | 1,571,283 | | | | 2,294,299 | | | | 212,922 | | | 2003 | | 40 yrs. |
| 747 Dresher Road | | Horsham, PA | | | — | | | | 1,607,238 | | | | — | | | | 4,935,054 | | | | 1,607,977 | | | | 4,934,315 | | | | 6,542,292 | | | | 2,185,045 | | | 1988 | | 40 yrs. |
| 507 Prudential Road | | Horsham, PA | | | 6,268,630 | | | | 644,900 | | | | 5,804,100 | | | | 8,784,448 | | | | 1,131,380 | | | | 14,102,068 | | | | 15,233,448 | | | | 3,726,697 | | | 1988 | | 40 yrs. |
| 767 Electronic Drive | | Horsham, PA | | | * | | | | 1,229,685 | | | | — | | | | 3,319,209 | | | | 1,241,970 | | | | 3,306,924 | | | | 4,548,893 | | | | 1,461,410 | | | 1996 | | 40 yrs. |
| 16445 Air Center Boulevard | | Houston, TX | | | — | | | | 363,339 | | | | 2,509,186 | | | | 545,867 | | | | 363,339 | | | | 3,055,053 | | | | 3,418,392 | | | | 940,458 | | | 1997 | | 40 yrs. |
| 16405 Air Center Boulevard | | Houston, TX | | | — | | | | 438,853 | | | | 3,030,396 | | | | 404,912 | | | | 438,853 | | | | 3,435,307 | | | | 3,874,160 | | | | 822,102 | | | 1997 | | 40 yrs. |
| 16580 Air Center Boulevard | | Houston, TX | | | — | | | | 289,000 | | | | 3,559,857 | | | | 265,899 | | | | 289,000 | | | | 3,825,756 | | | | 4,114,756 | | | | 834,181 | | | 1997 | | 40 yrs. |
| 1755 Trans Central Drive | | Houston, TX | | | — | | | | 293,534 | | | | 3,036,269 | | | | 190,651 | | | | 306,147 | | | | 3,214,306 | | | | 3,520,453 | | | | 579,451 | | | 1999 | | 40 yrs. |
| 16605 Air Center Boulevard | | Houston, TX | | | — | | | | 298,999 | | | | — | | | | 3,770,315 | | | | 496,186 | | | | 3,573,128 | | | | 4,069,314 | | | | 790,837 | | | 2002 | | 40 yrs. |
| 10739 West Little York Road | | Houston, TX | | | — | | | | 797,931 | | | | 5,950,894 | | | | 242,625 | | | | 799,560 | | | | 6,191,890 | | | | 6,991,450 | | | | 803,207 | | | 1999 | | 40 yrs. |
| 10735 West Little York Road | | Houston, TX | | | — | | | | 1,110,988 | | | | 6,351,946 | | | | 1,657,286 | | | | 1,135,483 | | | | 7,984,738 | | | | 9,120,220 | | | | 712,611 | | | 2000 | | 40 yrs. |
| 8801-19 & 8821-49 Fallbrook Drive | | Houston, TX | | | — | | | | 2,290,001 | | | | 15,297,141 | | | | 1,535,943 | | | | 2,290,002 | | | | 16,833,084 | | | | 19,123,085 | | | | 1,587,024 | | | 2000 | | 40 yrs. |
| 16685 Air Center Boulevard | | Houston, TX | | | — | | | | — | | | | — | | | | 2,935,268 | | | | 414,691 | | | | 2,520,577 | | | | 2,935,268 | | | | 184,042 | | | 2004 | | 40 yrs. |
| 8825-8839 N Sam Houston Pkwy | | Houston, TX | | | — | | | | 638,453 | | | | 3,258,815 | | | | 567,574 | | | | 638,477 | | | | 3,826,364 | | | | 4,464,842 | | | | 194,007 | | | 2004 | | 40 yrs. |
| 8850-8872 Fallbrook Drive | | Houston, TX | | | — | | | | 504,317 | | | | 2,878,351 | | | | 1,014,679 | | | | 504,341 | | | | 3,893,006 | | | | 4,397,347 | | | | 227,912 | | | 2004 | | 40 yrs. |
| 8802-8824 Fallbrook Drive | | Houston, TX | | | — | | | | 1,114,406 | | | | 6,364,767 | | | | 663,613 | | | | 1,114,433 | | | | 7,028,353 | | | | 8,142,786 | | | | 542,346 | | | 2004 | | 40 yrs. |
| 16602 Central Green Boulevard | | Houston, TX | | | — | | | | 284,403 | | | | — | | | | 4,496,262 | | | | 503,779 | | | | 4,276,886 | | | | 4,780,665 | | | | 149,476 | | | 2005 | | 40 yrs. |
| 20 Wright Avenue | | Hunt Valley, MD | | | — | | | | 1,205,946 | | | | — | | | | 9,669,027 | | | | 1,861,025 | | | | 9,013,948 | | | | 10,874,973 | | | | 1,351,645 | | | 2001 | | 40 yrs. |
| 4 North Park Drive | | Hunt Valley, MD | | | — | | | | 3,269,948 | | | | 13,551,370 | | | | 993,133 | | | | 3,269,948 | | | | 14,544,504 | | | | 17,814,451 | | | | 1,298,941 | | | 2003 | | 40 yrs. |
| 6 North Park Drive | | Hunt Valley, MD | | | — | | | | 2,077,949 | | | | 8,770,566 | | | | 1,109,669 | | | | 2,077,949 | | | | 9,880,235 | | | | 11,958,184 | | | | 976,602 | | | 2003 | | 40 yrs. |
| 10 North Park Drive | | Hunt Valley, MD | | | — | | | | 2,211,969 | | | | 7,816,042 | | | | 210,820 | | | | 2,211,969 | | | | 8,026,862 | | | | 10,238,831 | | | | 625,778 | | | 2003 | | 40 yrs. |
| 307 International Circle | | Hunt Valley, MD | | | — | | | | 3,538,319 | | | | 14,190,832 | | | | 11,315,040 | | | | 3,542,881 | | | | 25,501,310 | | | | 29,044,191 | | | | 735,562 | | | 2004 | | 40 yrs. |
| 309 International Circle | | Hunt Valley, MD | | | — | | | | 613,667 | | | | 2,458,204 | | | | 648,156 | | | | 615,096 | | | | 3,104,930 | | | | 3,720,026 | | | | 120,826 | | | 2004 | | 40 yrs. |
| 311 International Circle | | Hunt Valley, MD | | | — | | | | 313,365 | | | | 1,281,093 | | | | 69,591 | | | | 314,572 | | | | 1,349,478 | | | | 1,664,050 | | | | 35,808 | | | 2004 | | 40 yrs. |
| 8775 Baypine Road | | Jacksonville, FL | | | — | | | | 906,804 | | | | — | | | | 3,352,809 | | | | 913,013 | | | | 3,346,599 | | | | 4,259,613 | | | | 1,490,769 | | | 1989 | | 40 yrs. |
| 6255 Lake Gray Boulevard | | Jacksonville, FL | | | — | | | | 813,067 | | | | — | | | | 3,960,328 | | | | 812,634 | | | | 3,960,761 | | | | 4,773,395 | | | | 2,061,279 | | | 1987 | | 40 yrs. |
| 8665,8667,8669 Baypine Road | | Jacksonville, FL | | | — | | | | 966,552 | | | | — | | | | 5,892,549 | | | | 974,959 | | | | 5,884,142 | | | | 6,859,101 | | | | 2,590,822 | | | 1987 | | 40 yrs. |
| 7970 Bayberry Road | | Jacksonville, FL | | | — | | | | 127,520 | | | | — | | | | 1,369,921 | | | | 129,979 | | | | 1,367,462 | | | | 1,497,441 | | | | 1,018,453 | | | 1978 | | 40 yrs. |
| 7077 Bonneval Road | | Jacksonville, FL | | | — | | | | 768,000 | | | | 5,789,000 | | | | 3,066,996 | | | | 774,020 | | | | 8,849,976 | | | | 9,623,996 | | | | 3,280,922 | | | 1988 | | 40 yrs. |
| 4190 Belfort Road | | Jacksonville, FL | | | — | | | | 821,000 | | | | 5,866,000 | | | | 3,229,138 | | | | 827,420 | | | | 9,088,718 | | | | 9,916,138 | | | | 3,843,929 | | | 1986 | | 40 yrs. |
| 7020 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 398,257 | | | | — | | | | 2,780,426 | | | | 749,811 | | | | 2,428,873 | | | | 3,178,683 | | | | 1,020,424 | | | 1996 | | 40 yrs. |
| 7022 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 706,934 | | | | — | | | | 3,593,671 | | | | 853,981 | | | | 3,446,624 | | | | 4,300,605 | | | | 1,319,301 | | | 1996 | | 40 yrs. |
| 11777 Central Highway | | Jacksonville, FL | | | — | | | | 92,207 | | | | 429,997 | | | | 1,275,050 | | | | 140,426 | | | | 1,656,828 | | | | 1,797,254 | | | | 1,012,104 | | | 1985 | | 40 yrs. |
| 4345 Southpoint Parkway | | Jacksonville, FL | | | — | | | | — | | | | — | | | | 8,791,159 | | | | 418,093 | | | | 8,373,065 | | | | 8,791,159 | | | | 2,354,624 | | | 1998 | | 40 yrs. |
| 7016 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 597,181 | | | | — | | | | 2,377,385 | | | | 602,633 | | | | 2,371,934 | | | | 2,974,566 | | | | 1,042,593 | | | 1996 | | 40 yrs. |
| 7018 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 840,996 | | | | — | | | | 4,643,140 | | | | 846,461 | | | | 4,637,675 | | | | 5,484,136 | | | | 1,887,918 | | | 1997 | | 40 yrs. |
| 7014 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 574,198 | | | | — | | | | 3,633,593 | | | | 780,486 | | | | 3,427,305 | | | | 4,207,791 | | | | 1,137,784 | | | 1999 | | 40 yrs. |
| 6620 Southpoint Drive | | Jacksonville, FL | | | — | | | | 614,602 | | | | 4,267,477 | | | | 984,847 | | | | 614,602 | | | | 5,252,323 | | | | 5,866,926 | | | | 1,528,012 | | | 1984 | | 40 yrs. |
| 7980 Bayberry Road | | Jacksonville, FL | | | — | | | | 330,726 | | | | 1,338,101 | | | | 32,776 | | | | 330,726 | | | | 1,370,877 | | | | 1,701,603 | | | | 333,506 | | | 1978 | | 40 yrs. |
| 6600 Southpoint Parkway | | Jacksonville, FL | | | — | | | | 998,432 | | | | 4,055,727 | | | | 851,752 | | | | 1,002,704 | | | | 4,903,207 | | | | 5,905,911 | | | | 1,442,391 | | | 1986 | | 40 yrs. |
| 6700 Southpoint Parkway | | Jacksonville, FL | | | — | | | | 620,719 | | | | 2,989,746 | | | | 750,311 | | | | 624,215 | | | | 3,736,561 | | | | 4,360,776 | | | | 1,326,619 | | | 1987 | | 40 yrs. |
| 4801 Executive Park Court - 100 | | Jacksonville, FL | | | — | | | | 554,993 | | | | 2,993,277 | | | | 1,312,090 | | | | 554,542 | | | | 4,305,817 | | | | 4,860,360 | | | | 1,335,378 | | | 1990 | | 40 yrs. |
| 4801 Executive Park Court - 200 | | Jacksonville, FL | | | — | | | | 370,017 | | | | 1,995,518 | | | | 348,996 | | | | 370,039 | | | | 2,344,492 | | | | 2,714,531 | | | | 575,497 | | | 1990 | | 40 yrs. |
| 4810 Executive Park Court | | Jacksonville, FL | | | — | | | | 369,694 | | | | 3,045,639 | | | | 370,039 | | | | 941,958 | | | | 3,987,251 | | | | 4,357,291 | | | | 884,986 | | | 1990 | | 40 yrs. |
| 6602 Executive Park Court - 100 | | Jacksonville, FL | | | — | | | | 388,519 | | | | 2,095,293 | | | | 297,873 | | | | 388,541 | | | | 2,393,144 | | | | 2,781,685 | | | | 624,753 | | | 1993 | | 40 yrs. |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 6602 Executive Park Court - 200 | | Jacksonville, FL | | | — | | | | 296,014 | | | | 1,596,347 | | | | 449,559 | | | | 296,032 | | | | 2,045,888 | | | | 2,341,920 | | | | 515,311 | | | 1993 | | 40 yrs. |
| 6631 Executive Park Court - 100 | | Jacksonville, FL | | | — | | | | 251,613 | | | | 1,356,849 | | | | 482,785 | | | | 251,627 | | | | 1,839,620 | | | | 2,091,247 | | | | 609,302 | | | 1994 | | 40 yrs. |
| 6631 Executive Park Court - 200 | | Jacksonville, FL | | | — | | | | 406,561 | | | | 2,195,070 | | | | 221,980 | | | | 407,043 | | | | 2,416,568 | | | | 2,823,611 | | | | 677,090 | | | 1994 | | 40 yrs. |
| 4815 Executive Park Court - 100 | | Jacksonville, FL | | | — | | | | 366,317 | | | | 1,975,393 | | | | 340,258 | | | | 366,339 | | | | 2,315,629 | | | | 2,681,968 | | | | 712,134 | | | 1995 | | 40 yrs. |
| 4815 Executive Park Court - 200 | | Jacksonville, FL | | | — | | | | 462,522 | | | | 2,494,397 | | | | 459,048 | | | | 462,549 | | | | 2,953,418 | | | | 3,415,967 | | | | 852,379 | | | 1995 | | 40 yrs. |
| 4825 Executive Park Court | | Jacksonville, FL | | | — | | | | 601,278 | | | | 3,242,491 | | | | 282,810 | | | | 601,401 | | | | 3,525,178 | | | | 4,126,579 | | | | 959,847 | | | 1996 | | 40 yrs. |
| 4820 Executive Park Court | | Jacksonville, FL | | | — | | | | 555,173 | | | | 2,693,130 | | | | 768,348 | | | | 555,213 | | | | 3,461,439 | | | | 4,016,651 | | | | 909,913 | | | 1997 | | 40 yrs. |
| 6601 Executive Park Circle North | | Jacksonville, FL | | | — | | | | 551,250 | | | | 3,128,361 | | | | 640 | | | | 551,250 | | | | 3,129,001 | | | | 3,680,251 | | | | 703,615 | | | 1992 | | 40 yrs. |
| 4901 Belfort Road | | Jacksonville, FL | | | — | | | | 877,964 | | | | 2,360,742 | | | | 1,966,868 | | | | 877,964 | | | | 4,327,610 | | | | 5,205,574 | | | | 1,599,696 | | | 1986 | | 40 yrs. |
| 4899 Belfort Road | | Jacksonville, FL | | | — | | | | 1,299,201 | | | | — | | | | 8,179,240 | | | | 1,207,751 | | | | 8,270,690 | | | | 9,478,441 | | | | 1,787,670 | | | 2000 | | 40 yrs. |
| 4905 Belfort Street | | Jacksonville, FL | | | — | | | | 638,154 | | | | — | | | | 3,461,206 | | | | 641,272 | | | | 3,458,088 | | | | 4,099,360 | | | | 880,635 | | | 2000 | | 40 yrs. |
| 7251 Salisbury Road | | Jacksonville, FL | | | — | | | | — | | | | — | | | | 3,567,820 | | | | 662,559 | | | | 2,905,261 | | | | 3,567,820 | | | | 747,221 | | | 2000 | | 40 yrs. |
| 10245 Centurion Parkway North | | Jacksonville, FL | | | — | | | | 852,644 | | | | 3,510,889 | | | | 968,204 | | | | 853,704 | | | | 4,478,033 | | | | 5,331,737 | | | | 1,002,121 | | | 1996 | | 40 yrs. |
| 4887 Belfort Road | | Jacksonville, FL | | | — | | | | 1,299,202 | | | | — | | | | 7,890,278 | | | | 1,665,915 | | | | 7,523,565 | | | | 9,189,480 | | | | 1,444,468 | | | 2002 | | 40 yrs. |
| 7255 Salisbury Road | | Jacksonville, FL | | | — | | | | 392,060 | | | | — | | | | 2,982,347 | | | | 680,766 | | | | 2,693,641 | | | | 3,374,407 | | | | 481,925 | | | 2002 | | 40 yrs. |
| 5201 Gate Parkway | | Jacksonville, FL | | | — | | | | 3,836,532 | | | | — | | | | 21,192,513 | | | | 4,269,346 | | | | 20,759,699 | | | | 25,029,045 | | | | 446,736 | | | 2005 | | 40 yrs. |
| 3200 Horizon Drive | | King of Prussia, PA | | | — | | | | 928,637 | | | | — | | | | 7,053,358 | | | | 1,210,137 | | | | 6,771,857 | | | | 7,981,995 | | | | 2,424,253 | | | 1996 | | 40 yrs. |
| 440 East Swedesford Road | | King of Prussia, PA | | | — | | | | 717,001 | | | | 4,816,121 | | | | 2,684,214 | | | | 717,001 | | | | 7,500,335 | | | | 8,217,336 | | | | 2,723,279 | | | 1988 | | 40 yrs. |
| 460 East Swedesford Road | | King of Prussia, PA | | | — | | | | 705,317 | | | | 4,737,487 | | | | 3,799,506 | | | | 705,317 | | | | 8,536,993 | | | | 9,242,310 | | | | 1,888,272 | | | 1988 | | 40 yrs. |
| 151 South Warner Road | | King of Prussia, PA | | | — | | | | 1,218,086 | | | | 6,937,866 | | | | 360,761 | | | | 1,186,972 | | | | 7,329,741 | | | | 8,516,713 | | | | 1,860,186 | | | 1980 | | 40 yrs. |
| 3604 Horizon Drive | | King of Prussia, PA | | | — | | | | 397,178 | | | | — | | | | 1,628,512 | | | | 350,874 | | | | 1,674,816 | | | | 2,025,690 | | | | 688,143 | | | 1998 | | 40 yrs. |
| 3606 Horizon Drive | | King of Prussia, PA | | | — | | | | 789,409 | | | | — | | | | 1,947,590 | | | | 815,855 | | | | 1,921,144 | | | | 2,736,999 | | | | 771,104 | | | 1997 | | 40 yrs. |
| 650 Swedesford Road | | King of Prussia, PA | | | — | | | | 952,911 | | | | 6,722,830 | | | | 9,647,843 | | | | 952,911 1 | | | | 6,370,672 | | | | 17,323,583 | | | | 5,840,247 | | | 1971 | | 40 yrs. |
| 680 Swedesford Road | | King of Prussia, PA | | | — | | | | 952,361 | | | | 6,722,830 | | | | 8,367,206 | | | | 952,361 1 | | | | 5,090,036 | | | | 16,042,397 | | | | 5,693,790 | | | 1971 | | 40 yrs. |
| 3600 Horizon Drive | | King of Prussia, PA | | | — | | | | 236,432 | | | | 1,856,252 | | | | 610,135 | | | | 236,432 | | | | 2,466,387 | | | | 2,702,818 | | | | 487,948 | | | 1989 | | 40 yrs. |
| 3602 Horizon Drive | | King of Prussia, PA | | | — | | | | 217,734 | | | | 1,759,489 | | | | 338,288 | | | | 217,809 | | | | 2,097,701 | | | | 2,315,510 | | | | 545,130 | | | 1989 | | 40 yrs. |
| 2700 Horizon Drive | | King of Prussia, PA | | | — | | | | 764,370 | | | | — | | | | 3,682,257 | | | | 867,815 | | | | 3,578,812 | | | | 4,446,627 | | | | 1,125,765 | | | 1998 | | 40 yrs. |
| 2900 Horizon Drive | | King of Prussia, PA | | | — | | | | 679,440 | | | | — | | | | 3,503,074 | | | | 774,096 | | | | 3,408,418 | | | | 4,182,514 | | | | 910,904 | | | 1998 | | 40 yrs. |
| 2500 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 509,580 | | | | — | | | | 2,786,056 | | | | 592,886 | | | | 2,702,749 | | | | 3,295,636 | | | | 904,721 | | | 1999 | | 40 yrs. |
| 2300 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 509,580 | | | | — | | | | 3,038,151 | | | | 574,152 | | | | 2,973,578 | | | | 3,547,731 | | | | 764,372 | | | 1999 | | 40 yrs. |
| 2100 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 1,110,111 | | | | — | | | | 9,382,851 | | | | 1,132,519 | | | | 9,360,443 | | | | 10,492,962 | | | | 2,601,425 | | | 1999 | | 40 yrs. |
| 3400 Horizon Drive | | King of Prussia, PA | | | — | | | | 776,496 | | | | 3,139,068 | | | | 976,974 | | | | 776,496 | | | | 4,116,042 | | | | 4,892,538 | | | | 1,110,392 | | | 1995 | | 40 yrs. |
| 2301 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 1,645,246 | | | | — | | | | 30,063,879 | | | | 4,581,649 | | | | 27,127,475 | | | | 31,709,124 | | | | 4,096,749 | | | 2002 | | 40 yrs. |
| 2520 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 1,020,000 | | | | — | | | | 5,005,045 | | | | 978,402 | | | | 5,046,643 | | | | 6,025,045 | | | | 1,852,202 | | | 1999 | | 40 yrs. |
| 2201 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | — | | | | — | | | | 15,548,161 | | | | 2,413,514 | | | | 13,134,647 | | | | 15,548,161 | | | | 3,185,717 | | | 2000 | | 40 yrs. |
| 2540 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | — | | | | — | | | | 1,625,497 | | | | 274,341 | | | | 1,351,156 | | | | 1,625,497 | | | | 346,016 | | | 2000 | | 40 yrs. |
| 2560 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | — | | | | — | | | | 3,729,254 | | | | 649,792 | | | | 3,079,462 | | | | 3,729,254 | | | | 758,039 | | | 2000 | | 40 yrs. |
| 170 South Warner Road | | King of Prussia, PA | | | — | | | | 547,800 | | | | 3,137,400 | | | | 3,783,307 | | | | 458,232 | | | | 7,010,275 | | | | 7,468,507 | | | | 2,965,120 | | | 1980 | | 40 yrs. |
| 190 South Warner Road | | King of Prussia, PA | | | — | | | | 552,200 | | | | 3,162,600 | | | | 1,739,928 | | | | 461,909 | | | | 4,992,819 | | | | 5,454,728 | | | | 2,170,397 | | | 1980 | | 40 yrs. |
| 3100 Horizon Drive | | King of Prussia, PA | | | — | | | | 601,956 | | | | — | | | | 2,068,047 | | | | 611,436 | | | | 2,058,568 | | | | 2,670,003 | | | | 750,766 | | | 1995 | | 40 yrs. |
| 3500 Horizon Drive | | King of Prussia, PA | | | — | | | | 1,204,839 | | | | — | | | | 2,630,229 | | | | 1,223,875 | | | | 2,611,193 | | | | 3,835,068 | | | | 696,574 | | | 1996 | | 40 yrs. |
| 3000 Horizon Drive | | King of Prussia, PA | | | — | | | | 1,191,449 | | | | — | | | | 2,309,358 | | | | 946,703 | | | | 2,554,103 | | | | 3,500,806 | | | | 559,994 | | | 1997 | | 40 yrs. |
| 800 Town Center Drive | | Langhorne, PA | | | — | | | | 1,617,150 | | | | — | | | | 10,797,563 | | | | 1,619,288 | | | | 10,795,425 | | | | 12,414,713 | | | | 5,032,511 | | | 1987 | | 40 yrs. |
| 11425 State Highway 225 | | LaPorte, TX | | | — | | | | 975,974 | | | | 3,409,036 | | | | 7,682 | | | | 977,519 | | | | 3,415,173 | | | | 4,392,692 | | | | 31,583 | | | 2006 | | 40 yrs. |
| 11503 State Highway 225 | | LaPorte, TX | | | — | | | | 2,561,931 | | | | 9,779,023 | | | | 20,165 | | | | 2,565,988 | | | | 9,795,132 | | | | 12,361,120 | | | | 72,104 | | | 2006 | | 40 yrs. |
| 7528 Walker Way | | Lehigh Valley, PA | | | — | | | | 893,441 | | | | — | | | | 5,514,510 | | | | 779,330 | | | | 5,628,622 | | | | 6,407,952 | | | | 157,996 | | | 2004 | | 40 yrs. |
| 8301 Industrial Boulevard | | Lehigh, PA | | | — | | | | 11,249,550 | | | | — | | | | 44,122,702 | | | | 11,254,716 | | | | 44,117,536 | | | | 55,372,252 | | | | 1,310,158 | | | 2005 | | 40 yrs. |
| 32853 Edward Avenue | | Madison Heights, MI | | | — | | | | 138,121 | | | | 784,426 | | | | (5,207 | ) | | | 138,121 | | | | 779,219 | | | | 917,340 | | | | 210,450 | | | 1973 | | 40 yrs. |
| 750 East Mandoline Avenue | | Madison Heights, MI | | | — | | | | 151,458 | | | | 741,185 | | | | (80,456 | ) | | | 151,458 | | | | 660,728 | | | | 812,187 | | | | 172,982 | | | 1969 | | 40 yrs. |
| 900 East Mandoline Avenue | | Madison Heights, MI | | | — | | | | 157,729 | | | | 771,872 | | | | (43,850 | ) | | | 157,729 | | | | 728,022 | | | | 885,751 | | | | 223,686 | | | 1972 | | 40 yrs. |
| 31700 Research Park Drive | | Madison Heights, MI | | | — | | | | 373,202 | | | | 1,824,721 | | | | (158,741 | ) | | | 373,203 | | | | 1,665,979 | | | | 2,039,182 | | | | 382,957 | | | 1988 | | 40 yrs. |
| 31771 Sherman Avenue | | Madison Heights, MI | | | — | | | | 150,944 | | | | 645,040 | | | | (7,564 | ) | | | 150,944 | | | | 637,475 | | | | 788,420 | | | | 203,445 | | | 1982 | | 40 yrs. |
| 31791 Sherman Avenue | | Madison Heights, MI | | | — | | | | 105,606 | | | | 649,891 | | | | (54,791 | ) | | | 105,606 | | | | 595,100 | | | | 700,706 | | | | 143,185 | | | 1983 | | 40 yrs. |
| 31811 Sherman Avenue | | Madison Heights, MI | | | — | | | | 207,599 | | | | 1,179,010 | | | | (149,901 | ) | | | 207,599 | | | | 1,029,110 | | | | 1,236,709 | | | | 254,186 | | | 1983 | | 40 yrs. |
| 1201 East Whitcomb Avenue | | Madison Heights, MI | | | — | | | | 302,567 | | | | 1,213,232 | | | | (175,088 | ) | | | 302,567 | | | | 1,038,144 | | | | 1,340,711 | | | | 266,116 | | | 1980 | | 40 yrs. |
| 1901 Summit Tower Boulevard | | Maitland, FL | | | — | | | | 6,078,791 | | | | 12,348,567 | | | | 1,625,469 | | | | 6,083,206 | | | | 13,969,622 | | | | 20,052,828 | | | | 2,792,232 | | | 1998 | | 40 yrs. |
| 45-67 Great Valley Parkway | | Malvern, PA | | | — | | | | 795,143 | | | | — | | | | 3,352,726 | | | | 795,831 | | | | 3,352,038 | | | | 4,147,869 | | | | 2,136,395 | | | 1974 | | 40 yrs. |
| 11,15 Great Valley Parkway | | Malvern, PA | | | * | | | | 1,837,050 | | | | — | | | | 15,005,064 | | | | 1,837,878 | | | | 15,004,237 | | | | 16,842,114 | | | | 9,920,837 | | | 1986 | | 40 yrs. |
| 27-43 Great Valley Parkway | | Malvern, PA | | | — | | | | 448,775 | | | | — | | | | 2,545,542 | | | | 449,447 | | | | 2,544,870 | | | | 2,994,317 | | | | 1,549,853 | | | 1977 | | 40 yrs. |
| 1 Country View Road | | Malvern, PA | | | — | | | | 400,000 | | | | 3,600,000 | | | | 1,007,648 | | | | 406,421 | | | | 4,601,227 | | | | 5,007,648 | | | | 1,396,584 | | | 1982 | | 40 yrs. |
| 200 Chesterfield Parkway | | Malvern, PA | | | — | | | | 495,893 | | | | 2,739,093 | | | | 558,159 | | | | 544,649 | | | | 3,248,496 | | | | 3,793,145 | | | | 1,920,292 | | | 1989 | | 40 yrs. |
| 50 Morehall Road | | Malvern, PA | | | — | | | | 849,576 | | | | — | | | | 13,043,717 | | | | 1,337,076 | | | | 12,556,217 | | | | 13,893,293 | | | | 4,337,326 | | | 1997 | | 40 yrs. |
| 1 Great Valley Parkway | | Malvern, PA | | | — | | | | 419,460 | | | | 3,792,570 | | | | 330,704 | | | | 419,460 | | | | 4,123,273 | | | | 4,542,734 | | | | 1,064,218 | | | 1982 | | 40 yrs. |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 5 Great Valley Parkway | | Malvern, PA | | | — | | | | 684,200 | | | | 6,181,661 | | | | 1,305,825 | | | | 684,200 | | | | 7,487,486 | | | | 8,171,686 | | | | 1,853,061 | | | 1983 | | 40 yrs. |
| 1001 Cedar Hollow Road | | Malvern, PA | | | — | | | | 1,436,814 | | | | — | | | | 16,077,184 | | | | 1,676,470 | | | | 15,837,528 | | | | 17,513,998 | | | | 4,972,256 | | | 1998 | | 40 yrs. |
| 3 Country View Road | | Malvern, PA | | | * | | | | 814,278 | | | | — | | | | 5,142,433 | | | | 1,128,881 | | | | 4,827,830 | | | | 5,956,711 | | | | 984,217 | | | 1998 | | 40 yrs. |
| 425 Technology Drive | | Malvern, PA | | | — | | | | 191,114 | | | | — | | | | 2,101,323 | | | | 321,473 | | | | 1,970,964 | | | | 2,292,437 | | | | 698,708 | | | 1998 | | 40 yrs. |
| 375 Technology Drive | | Malvern, PA | | | — | | | | 191,114 | | | | — | | | | 1,958,524 | | | | 234,922 | | | | 1,914,715 | | | | 2,149,638 | | | | 703,554 | | | 1998 | | 40 yrs. |
| 45 Liberty Boulevard | | Malvern, PA | | | — | | | | 4,380,221 | | | | — | | | | 15,314,868 | | | | 4,749,748 | | | | 14,945,341 | | | | 19,695,089 | | | | 4,425,097 | | | 1999 | | 40 yrs. |
| 100 Chesterfield Parkway | | Malvern, PA | | | — | | | | 1,320,625 | | | | — | | | | 7,019,034 | | | | 1,349,954 | | | | 6,989,705 | | | | 8,339,659 | | | | 2,255,284 | | | 1998 | | 40 yrs. |
| 600 Chesterfield Parkway | | Malvern, PA | | | — | | | | 2,013,750 | | | | — | | | | 8,135,324 | | | | 2,050,555 | | | | 8,098,519 | | | | 10,149,074 | | | | 2,360,776 | | | 1999 | | 40 yrs. |
| 700 Chesterfield Parkway | | Malvern, PA | | | — | | | | 2,013,750 | | | | — | | | | 8,096,150 | | | | 2,037,813 | | | | 8,072,087 | | | | 10,109,900 | | | | 2,337,776 | | | 1999 | | 40 yrs. |
| 18 Great Valley Parkway | | Malvern, PA | | | — | | | | 394,036 | | | | 3,976,221 | | | | 99,539 | | | | 397,293 | | | | 4,072,504 | | | | 4,469,796 | | | | 823,431 | | | 1980 | | 40 yrs. |
| 11 Great Valley Parkway | | Malvern, PA | | | — | | | | 496,297 | | | | — | | | | 3,226,924 | | | | 708,331 | | | | 3,014,890 | | | | 3,723,221 | | | | 672,667 | | | 2001 | | 40 yrs. |
| 40 Liberty Boulevard | | Malvern, PA | | | — | | | | 4,241,137 | | | | 17,737,090 | | | | 2,182,842 | | | | 4,241,167 | | | | 19,919,901 | | | | 24,161,068 | | | | 5,326,655 | | | 1989 | | 40 yrs. |
| 2 West Liberty Boulevard | | Malvern, PA | | | — | | | | 5,405,041 | | | | — | | | | 11,415,086 | | | | 5,405,042 | | | | 11,415,085 | | | | 16,820,127 | | | | 400,621 | | | 2003 | | 40 yrs. |
| 10 Great Valley Parkway | | Malvern, PA | | | — | | | | 823,540 | | | | 1,341,376 | | | | 256,839 | | | | 832,244 | | | | 1,589,510 | | | | 2,421,754 | | | | 135,101 | | | 2003 | | 40 yrs. |
| 10, 20 Liberty Boulevard | | Malvern, PA | | | — | | | | 724,058 | | | | — | | | | 5,767,715 | | | | 724,846 | | | | 5,766,927 | | | | 6,491,773 | | | | 2,492,462 | | | 1985 | | 40 yrs. |
| 420 Lapp Road | | Malvern, PA | | | — | | | | 1,054,418 | | | | — | | | | 6,995,922 | | | | 1,055,243 | | | | 6,995,097 | | | | 8,050,340 | | | | 3,081,121 | | | 1989 | | 40 yrs. |
| 14 Lee Boulevard | | Malvern, PA | | | — | | | | 664,282 | | | | — | | | | 5,855,867 | | | | 643,892 | | | | 5,876,257 | | | | 6,520,149 | | | | 2,676,923 | | | 1988 | | 40 yrs. |
| 500 Chesterfield Parkway | | Malvern, PA | | | — | | | | 472,364 | | | | — | | | | 3,276,521 | | | | 473,139 | | | | 3,275,746 | | | | 3,748,885 | | | | 1,665,286 | | | 1988 | | 40 yrs. |
| 300-400 Chesterfield Parkway | | Malvern, PA | | | — | | | | 937,212 | | | | — | | | | 5,616,170 | | | | 937,942 | | | | 5,615,440 | | | | 6,553,382 | | | | 2,587,331 | | | 1988 | | 40 yrs. |
| 40 Valley Stream Parkway | | Malvern, PA | | | — | | | | 322,918 | | | | — | | | | 3,224,458 | | | | 325,775 | | | | 3,221,601 | | | | 3,547,376 | | | | 1,327,967 | | | 1987 | | 40 yrs. |
| 50 Valley Stream Parkway | | Malvern, PA | | | — | | | | 323,971 | | | | — | | | | 2,694,447 | | | | 323,792 | | | | 2,694,627 | | | | 3,018,418 | | | | 1,147,301 | | | 1987 | | 40 yrs. |
| 20 Valley Stream Parkway | | Malvern, PA | | | — | | | | 465,539 | | | | — | | | | 5,726,197 | | | | 466,413 | | | | 5,725,323 | | | | 6,191,736 | | | | 2,874,409 | | | 1987 | | 40 yrs. |
| 257-275 Great Valley Parkway | | Malvern, PA | | | — | | | | 504,611 | | | | — | | | | 5,186,454 | | | | 505,458 | | | | 5,185,606 | | | | 5,691,065 | | | | 2,963,952 | | | 1983 | | 40 yrs. |
| 300 Technology Drive | | Malvern, PA | | | — | | | | 368,626 | | | | — | | | | 1,344,816 | | | | 374,497 | | | | 1,338,945 | | | | 1,713,442 | | | | 706,537 | | | 1985 | | 40 yrs. |
| 277-293 Great Valley Parkway | | Malvern, PA | | | — | | | | 530,729 | | | | — | | | | 2,330,242 | | | | 531,534 | | | | 2,329,436 | | | | 2,860,971 | | | | 1,322,006 | | | 1984 | | 40 yrs. |
| 311 Technology Drive | | Malvern, PA | | | — | | | | 397,131 | | | | — | | | | 2,724,819 | | | | 397,948 | | | | 2,724,002 | | | | 3,121,950 | | | | 1,423,585 | | | 1984 | | 40 yrs. |
| 7 Great Valley Parkway | | Malvern, PA | | | — | | | | 176,435 | | | | — | | | | 5,036,553 | | | | 177,317 | | | | 5,035,671 | | | | 5,212,988 | | | | 2,814,524 | | | 1985 | | 40 yrs. |
| 55 Valley Stream Parkway | | Malvern, PA | | | — | | | | 215,005 | | | | — | | | | 4,281,663 | | | | 215,818 | | | | 4,280,850 | | | | 4,496,668 | | | | 1,915,746 | | | 1983 | | 40 yrs. |
| 65 Valley Stream Parkway | | Malvern, PA | | | — | | | | 381,544 | | | | — | | | | 7,597,364 | | | | 382,361 | | | | 7,596,548 | | | | 7,978,908 | | | | 3,914,905 | | | 1983 | | 40 yrs. |
| 508 Lapp Road | | Malvern, PA | | | — | | | | 331,392 | | | | — | | | | 2,033,164 | | | | 332,216 | | | | 2,032,340 | | | | 2,364,556 | | | | 1,228,001 | | | 1984 | | 40 yrs. |
| 10 Valley Stream Parkway | | Malvern, PA | | | * | | | | 509,075 | | | | — | | | | 3,089,935 | | | | 509,899 | | | | 3,089,111 | | | | 3,599,010 | | | | 1,714,026 | | | 1984 | | 40 yrs. |
| 333 Phoenixville Pike | | Malvern, PA | | | — | | | | 523,530 | | | | — | | | | 2,917,373 | | | | 524,230 | | | | 2,916,673 | | | | 3,440,903 | | | | 1,580,984 | | | 1985 | | 40 yrs. |
| 30 Great Valley Parkway | | Malvern, PA | | | — | | | | 128,126 | | | | — | | | | 85,634 | | | | 128,783 | | | | 384,977 | | | | 513,760 | | | | 315,346 | | | 1975 | | 40 yrs. |
| 75 Great Valley Parkway | | Malvern, PA | | | 350,090 | | | | 143,074 | | | | — | | | | 772,841 | | | | 143,811 | | | | 772,103 | | | | 915,915 | | | | 577,889 | | | 1977 | | 40 yrs. |
| 77-123 Great Valley Parkway | | Malvern, PA | | | — | | | | 887,664 | | | | — | | | | 5,700,921 | | | | 888,359 | | | | 5,700,225 | | | | 6,588,585 | | | | 3,391,343 | | | 1978 | | 40 yrs. |
| 256 Great Valley Parkway | | Malvern, PA | | | — | | | | 161,098 | | | | — | | | | 1,785,717 | | | | 161,949 | | | | 1,784,866 | | | | 1,946,815 | | | | 1,157,980 | | | 1980 | | 40 yrs. |
| 205 Great Valley Parkway | | Malvern, PA | | | — | | | | 1,368,259 | | | | — | | | | 10,706,926 | | | | 1,369,003 | | | | 10,706,182 | | | | 12,075,185 | | | | 6,686,126 | | | 1981 | | 40 yrs. |
| 12,14,16 Great Valley Parkway | | Malvern, PA | | | — | | | | 130,689 | | | | — | | | | 1,562,994 | | | | 128,767 | | | | 1,564,916 | | | | 1,693,683 | | | | 884,224 | | | 1982 | | 40 yrs. |
| 155 Great Valley Parkway | | Malvern, PA | | | — | | | | 625,147 | | | | — | | | | 2,627,280 | | | | 626,068 | | | | 2,626,359 | | | | 3,252,427 | | | | 1,541,665 | | | 1981 | | 40 yrs. |
| 510 Lapp Road | | Malvern, PA | | | * | | | | 356,950 | | | | — | | | | 926,587 | | | | 357,751 | | | | 925,786 | | | | 1,283,537 | | | | 572,178 | | | 1983 | | 40 yrs. |
| 60 Morehall Road | | Malvern, PA | | | — | | | | 865,424 | | | | 9,285,000 | | | | 4,971,296 | | | | 884,974 | | | | 14,236,746 | | | | 15,121,720 | | | | 6,358,326 | | | 1989 | | 40 yrs. |
| 5 Country View Road | | Malvern, PA | | | * | | | | 785,168 | | | | 4,678,632 | | | | 1,178,927 | | | | 786,235 | | | | 5,856,492 | | | | 6,642,727 | | | | 1,953,040 | | | 1985 | | 40 yrs. |
| 7550 Meridian Circle | | Maple Grove, MN | | | — | | | | 513,250 | | | | 2,901,906 | | | | 222,006 | | | | 513,250 | | | | 3,123,911 | | | | 3,637,161 | | | | 721,019 | | | 1989 | | 40 yrs. |
| 8 Stow Road | | Marlton, NJ | | | — | | | | 172,600 | | | | 1,704,436 | | | | 188,555 | | | | 172,945 | | | | 1,892,646 | | | | 2,065,591 | | | | 651,714 | | | 1988 | | 40 yrs. |
| 10 Stow Road | | Marlton, NJ | | | — | | | | 147,000 | | | | 1,451,536 | | | | 527,956 | | | | 147,318 | | | | 1,979,174 | | | | 2,126,492 | | | | 962,254 | | | 1988 | | 40 yrs. |
| 12 Stow Road | | Marlton, NJ | | | — | | | | 103,300 | | | | 1,021,036 | | | | 342,868 | | | | 103,618 | | | | 1,363,587 | | | | 1,467,205 | | | | 588,823 | | | 1988 | | 40 yrs. |
| 14 Stow Road | | Marlton, NJ | | | — | | | | 93,100 | | | | 920,336 | | | | 431,684 | | | | 93,418 | | | | 1,351,703 | | | | 1,445,120 | | | | 576,452 | | | 1988 | | 40 yrs. |
| 701A Route 73 South | | Marlton, NJ | | | — | | | | 264,387 | | | | 3,772,000 | | | | 3,501,001 | | | | 271,743 | | | | 7,265,645 | | | | 7,537,388 | | | | 3,312,275 | | | 1987 | | 40 yrs. |
| 701C Route 73 South | | Marlton, NJ | | | — | | | | 84,949 | | | | 1,328,000 | | | | 422,106 | | | | 96,161 | | | | 1,738,894 | | | | 1,835,055 | | | | 672,972 | | | 1987 | | 40 yrs. |
| 400 Lippincott Drive | | Marlton, NJ | | | — | | | | 69,402 | | | | — | | | | 3,671,296 | | | | 317,799 | | | | 3,422,899 | | | | 3,740,699 | | | | 910,493 | | | 1999 | | 40 yrs. |
| 406 Lippincott Drive | | Marlton, NJ | | | — | | | | 321,455 | | | | 1,539,871 | | | | 888,175 | | | | 327,554 | | | | 2,421,947 | | | | 2,749,501 | | | | 975,306 | | | 1990 | | 40 yrs. |
| 301 Lippincott Drive | | Marlton, NJ | | | — | | | | 1,069,837 | | | | 4,780,163 | | | | 1,469,444 | | | | 1,069,838 | | | | 6,249,607 | | | | 7,319,444 | | | | 2,078,211 | | | 1988 | | 40 yrs. |
| 303 Lippincott Drive | | Marlton, NJ | | | — | | | | 1,069,837 | | | | 4,780,163 | | | | 2,194,896 | | | | 1,069,838 | | | | 6,975,059 | | | | 8,044,896 | | | | 2,276,639 | | | 1988 | | 40 yrs. |
| 901 Route 73 | | Marlton, NJ | | | — | | | | 334,411 | | | | 2,733,314 | | | | 894,989 | | | | 334,411 | | | | 3,628,303 | | | | 3,962,714 | | | | 1,045,261 | | | 1985 | | 40 yrs. |
| 404 Lippincott Drive | | Marlton, NJ | | | — | | | | 131,896 | | | | — | | | | 1,653,262 | | | | 131,896 | | | | 1,653,262 | | | | 1,785,158 | | | | 657,060 | | | 1997 | | 40 yrs. |
| 402 Lippincott Drive | | Marlton, NJ | | | — | | | | 131,896 | | | | — | | | | 1,736,907 | | | | 131,896 | | | | 1,736,907 | | | | 1,868,803 | | | | 682,815 | | | 1997 | | 40 yrs. |
| 9 Stow Road | | Marlton, NJ | | | — | | | | 652,642 | | | | 1,765,065 | | | | 922,394 | | | | 654,779 | | | | 2,685,323 | | | | 3,340,101 | | | | 766,449 | | | 1989 | | 40 yrs. |
| 75 Brookfield Oaks Drive | | Mauldin, SC | | | — | | | | 419,731 | | | | — | | | | 2,444,403 | | | | 430,909 | | | | 2,433,225 | | | | 2,864,134 | | | | 68,857 | | | 2003 | | 40 yrs. |
| 65 Brookfield Oaks Drive | | Mauldin, SC | | | — | | | | 557,174 | | | | — | | | | 2,728,911 | | | | 506,318 | | | | 2,779,768 | | | | 3,286,086 | | | | 67,739 | | | 2004 | | 40 yrs. |
| 8301 West Parkland Court | | Milwaukee, WI | | | — | | | | 358,442 | | | | 3,233,707 | | | | 532,301 | | | | 358,442 | | | | 3,766,008 | | | | 4,124,449 | | | | 971,466 | | | 1982 | | 40 yrs. |
| 7800 N. 113th Street | | Milwaukee, WI | | | — | | | | 1,711,964 | | | | 6,847,857 | | | | 392,036 | | | | 1,711,964 | | | | 7,239,893 | | | | 8,951,858 | | | | 1,726,879 | | | 1991 | | 40 yrs. |
| 11950 W. Lake Park Drive | | Milwaukee, WI | | �� | — | | | | 391,813 | | | | 2,340,118 | | | | 539,517 | | | | 394,938 | | | | 2,876,510 | | | | 3,271,448 | | | | 719,848 | | | 1986 | | 40 yrs. |
| 11400 W. Lake Park Drive | | Milwaukee, WI | | | — | | | | 439,595 | | | | 2,357,904 | | | | 234,658 | | | | 443,101 | | | | 2,589,056 | | | | 3,032,157 | | | | 521,325 | | | 1986 | | 40 yrs. |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11425 W. Lake Park Drive | | Milwaukee, WI | | | — | | | | 382,256 | | | | 2,350,619 | | | | 957,723 | | | | 385,305 | | | | 3,305,293 | | | | 3,690,598 | | | | 982,930 | | | 1987 | | 40 yrs. |
| 11301 W. Lake Park Drive | | Milwaukee, WI | | | — | | | | 614,477 | | | | 2,626,456 | | | | 101,328 | | | | 619,465 | | | | 2,722,797 | | | | 3,342,261 | | | | 542,487 | | | 1987 | | 40 yrs. |
| 11900 W. Lake Park Drive | | Milwaukee, WI | | | — | | | | 347,853 | | | | 2,396,887 | | | | 1,057,251 | | | | 350,628 | | | | 3,451,364 | | | | 3,801,992 | | | | 910,149 | | | 1987 | | 40 yrs. |
| 11414 West Park Place | | Milwaukee, WI | | | — | | | | 234,443 | | | | — | | | | 10,202,898 | | | | 491,531 | | | | 9,945,810 | | | | 10,437,341 | | | | 2,308,691 | | | 2001 | | 40 yrs. |
| 11520 West Calumet Road | | Milwaukee, WI | | | — | | | | 341,698 | | | | 1,527,548 | | | | 78,494 | | | | 341,698 | | | | 1,606,042 | | | | 1,947,740 | | | | 281,217 | | | 1995 | | 40 yrs. |
| 12100 West Park Place | | Milwaukee, WI | | | — | | | | 534,470 | | | | 3,239,389 | | | | 565,184 | | | | 532,370 | | | | 3,806,673 | | | | 4,339,043 | | | | 779,371 | | | 1984 | | 40 yrs. |
| 10855 West Park Place | | Milwaukee, WI | | | — | | | | 122,894 | | | | — | | | | 3,045,358 | | | | 424,710 | | | | 2,743,541 | | | | 3,168,251 | | | | 447,822 | | | 2002 | | 40 yrs. |
| 11100 West Liberty Drive | | Milwaukee, WI | | | — | | | | 1,800,000 | | | | — | | | | 7,690,908 | | | | 1,801,024 | | | | 7,689,884 | | | | 9,490,908 | | | | 730,540 | | | 2003 | | 40 yrs. |
| 11050 West Liberty Drive | | Milwaukee, WI | | | — | | | | — | | | | — | | | | 3,813,517 | | | | 914,760 | | | | 2,898,757 | | | | 3,813,517 | | | | 25,802 | | | 2005 | | 40 yrs. |
| 4700 Nathan Lane North | | Minneapolis, MN | | | — | | | | 1,501,308 | | | | 8,446,083 | | | | 225,056 | | | | 1,501,308 | | | | 8,671,139 | | | | 10,172,447 | | | | 1,567,239 | | | 1996 | | 40 yrs. |
| 4600 Nathan Lane | | Minneapolis, MN | | | — | | | | 1,063,558 | | | | — | | | | 6,683,083 | | | | 1,038,197 | | | | 6,708,444 | | | | 7,746,641 | | | | 1,363,486 | | | 2002 | | 40 yrs. |
| 12501 & 12701 Whitewater Drive | | Minnegonka, MN | | | — | | | | 2,175,209 | | | | 3,948,085 | | | | 7,249,452 | | | | 2,177,953 | | | | 11,194,793 | | | | 13,372,746 | | | | 788,290 | | | 1986 | | 40 yrs. |
| 5600 & 5610 Rowland Road | | Minnetonka, MN | | | — | | | | 828,650 | | | | 7,399,409 | | | | 1,595,422 | | | | 829,263 | | | | 8,994,217 | | | | 9,823,481 | | | | 2,892,234 | | | 1988 | | 40 yrs. |
| 5400-5500 Feltl Road | | Minnetonka, MN | | | — | | | | 883,895 | | | | 7,983,345 | | | | 2,275,102 | | | | 883,895 | | | | 10,258,447 | | | | 11,142,342 | | | | 2,480,922 | | | 1985 | | 40 yrs. |
| 10300 Bren Road | | Minnetonka, MN | | | — | | | | 344,614 | | | | 3,110,477 | | | | 894,944 | | | | 344,614 | | | | 4,005,421 | | | | 4,350,034 | | | | 857,897 | | | 1981 | | 40 yrs. |
| 3400 Lakeside Drive | | Miramar, FL | | | — | | | | 2,022,153 | | | | 11,345,881 | | | | 1,214,422 | | | | 2,022,153 | | | | 12,560,302 | | | | 14,582,456 | | | | 3,135,197 | | | 1990 | | 40 yrs. |
| 3450 Lakeside Drive | | Miramar, FL | | | — | | | | 2,022,152 | | | | 11,357,143 | | | | 2,078,093 | | | | 2,022,152 | | | | 13,435,235 | | | | 15,457,387 | | | | 3,478,905 | | | 1990 | | 40 yrs. |
| 3350 SW 148th Avenue | | Miramar, FL | | | — | | | | 2,960,511 | | | | — | | | | 19,294,616 | | | | 2,980,689 | | | | 19,274,437 | | | | 22,255,127 | | | | 4,341,655 | | | 2000 | | 40 yrs. |
| 300 Fellowship Road | | Mt Laurel, NJ | | | — | | | | — | | | | — | | | | 7,330,090 | | | | 1,098,904 | | | | 6,231,186 | | | | 7,330,090 | | | | 420,257 | | | 2004 | | 40 yrs. |
| 302 Fellowship Road | | Mt Laurel, NJ | | | — | | | | 1,512,120 | | | | — | | | | 2,801,598 | | | | 539,060 | | | | 3,774,658 | | | | 4,313,718 | | | | 88,186 | | | 2001 | | 40 yrs. |
| 3001 Leadenhall Road | | Mt Laurel, NJ | | | — | | | | 1,925,719 | | | | 191,390 | | | | 10,965,396 | | | | 1,936,489 | | | | 11,146,016 | | | | 13,082,505 | | | | 879,074 | | | 2003 | | 40 yrs. |
| 350 Fellowship Road | | Mt Laurel, NJ | | | — | | | | 2,960,159 | | | | 1,449,611 | | | | 3,535,489 | | | | 2,966,686 | | | | 4,978,573 | | | | 7,945,259 | | | | 9,251 | | | 2006 | | 40 yrs. |
| 4001 Leadenhall Road | | Mt. Laurel, NJ | | | — | | | | 3,207,885 | | | | 391,167 | | | | 18,844,592 | | | | 2,784,694 | | | | 19,658,950 | | | | 22,443,644 | | | | 2,744,761 | | | 2002 | | 40 yrs. |
| 3000 Atrium Way | | Mt. Laurel, NJ | | | — | | | | 500,000 | | | | 4,500,000 | | | | 4,498,462 | | | | 512,018 | | | | 8,986,445 | | | | 9,498,462 | | | | 3,980,005 | | | 1987 | | 40 yrs. |
| 11000, 15000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 310,585 | | | | 4,394,900 | | | | 254,820 | | | | 311,950 | | | | 4,648,355 | | | | 4,960,305 | | | | 1,942,493 | | | 1985 | | 40 yrs. |
| 12000, 14000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 361,800 | | | | 3,285,817 | | | | 783,587 | | | | 362,855 | | | | 4,068,349 | | | | 4,431,204 | | | | 1,426,020 | | | 1985 | | 40 yrs. |
| 16000, 18000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 289,700 | | | | 2,512,683 | | | | 573,915 | | | | 290,545 | | | | 3,085,753 | | | | 3,376,298 | | | | 1,126,581 | | | 1985 | | 40 yrs. |
| 1300 Route 73 North | | Mt. Laurel, NJ | | | — | | | | 449,400 | | | | 3,074,850 | | | | 1,704,275 | | | | 450,558 | | | | 4,777,967 | | | | 5,228,525 | | | | 1,530,369 | | | 1988 | | 40 yrs. |
| 6000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 234,151 | | | | 2,022,683 | | | | 925,491 | | | | 234,151 | | | | 2,948,174 | | | | 3,182,325 | | | | 811,584 | | | 1985 | | 40 yrs. |
| 7000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 260,014 | | | | 2,236,684 | | | | 427,949 | | | | 260,014 | | | | 2,664,633 | | | | 2,924,647 | | | | 746,489 | | | 1984 | | 40 yrs. |
| 8000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 234,814 | | | | 1,995,098 | | | | 317,849 | | | | 234,814 | | | | 2,312,947 | | | | 2,547,761 | | | | 604,374 | | | 1983 | | 40 yrs. |
| 9000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 286,587 | | | | 2,474,820 | | | | 595,749 | | | | 286,587 | | | | 3,070,569 | | | | 3,357,156 | | | | 1,010,672 | | | 1983 | | 40 yrs. |
| 1000 Briggs Road | | Mt. Laurel, NJ | | | — | | | | 288,577 | | | | 2,546,537 | | | | 1,450,255 | | | | 288,577 | | | | 3,996,792 | | | | 4,285,369 | | | | 1,422,723 | | | 1986 | | 40 yrs. |
| 1025 Briggs Road | | Mt. Laurel, NJ | | | 773,515 | | | | 430,990 | | | | 3,714,828 | | | | 1,320,195 | | | | 430,990 | | | | 5,035,023 | | | | 5,466,013 | | | | 1,496,665 | | | 1987 | | 40 yrs. |
| 1020 Briggs Road | | Mt. Laurel, NJ | | | — | | | | 494,334 | | | | — | | | | 3,162,455 | | | | 569,184 | | | | 3,087,606 | | | | 3,656,789 | | | | 825,078 | | | 1999 | | 40 yrs. |
| 2000 Crawford Place | | Mt. Laurel, NJ | | | — | | | | 310,831 | | | | 2,797,744 | | | | 2,814,041 | | | | 310,831 | | | | 5,611,785 | | | | 5,922,616 | | | | 2,067,243 | | | 1986 | | 40 yrs. |
| 5000 Dearborn Court | | Mt. Laurel, NJ | | | — | | | | 1,057,763 | | | | 4,191,827 | | | | 531,794 | | | | 1,057,763 | | | | 4,723,621 | | | | 5,781,384 | | | | 1,129,274 | | | 1988 | | 40 yrs. |
| 1001 Briggs Road | | Mt. Laurel, NJ | | | — | | | | 701,705 | | | | 3,505,652 | | | | 2,115,996 | | | | 701,705 | | | | 5,621,649 | | | | 6,323,354 | | | | 1,805,100 | | | 1986 | | 40 yrs. |
| 1015 Briggs Road | | Mt. Laurel, NJ | | | — | | | | 356,987 | | | | — | | | | 3,666,093 | | | | 470,659 | | | | 3,552,421 | | | | 4,023,080 | | | | 792,151 | | | 2000 | | 40 yrs. |
| 17000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 144,515 | | | | — | | | | 3,010,679 | | | | 144,515 | | | | 3,010,679 | | | | 3,155,194 | | | | 691,482 | | | 2001 | | 40 yrs. |
| 9401-9443 Science Center Drive | | New Hope, MN | | | — | | | | 431,295 | | | | 3,888,684 | | | | 480,123 | | | | 510,064 | | | | 4,290,038 | | | | 4,800,102 | | | | 1,115,258 | | | 1989 | | 40 yrs. |
| 6 Terry Drive | | Newtown, PA | | | — | | | | 622,029 | | | | 2,228,851 | | | | 828,769 | | | | 622,205 | | | | 3,057,443 | | | | 3,679,648 | | | | 824,454 | | | 1981 | | 40 yrs. |
| 550-590 Hale Avenue | | Oakdale, MN | | | — | | | | 765,535 | | | | 3,488,754 | | | | 510,819 | | | | 766,390 | | | | 3,998,718 | | | | 4,765,107 | | | | 847,827 | | | 1996 | | 40 yrs. |
| 1879 Lamont Avenue | | Odenton, MD | | | — | | | | 1,976,000 | | | | 8,099,579 | | | | 3,032,136 | | | | 2,011,030 | | | | 11,096,685 | | | | 13,107,715 | | | | 524,714 | | | 2004 | | 40 yrs. |
| 350 Winmeyer Avenue | | Odenton, MD | | | — | | | | 1,778,400 | | | | 7,289,165 | | | | 1,924,628 | | | | 1,809,927 | | | | 9,182,266 | | | | 10,992,193 | | | | 388,054 | | | 2004 | | 40 yrs. |
| 9600 Satellite Boulevard | | Orlando, FL | | | — | | | | 252,850 | | | | 1,297,923 | | | | 62,116 | | | | 252,850 | | | | 1,360,039 | | | | 1,612,889 | | | | 336,709 | | | 1989 | | 40 yrs. |
| 9700 Satellite Boulevard | | Orlando, FL | | | — | | | | 405,362 | | | | 1,146,546 | | | | 350,999 | | | | 405,362 | | | | 1,497,545 | | | | 1,902,907 | | | | 387,847 | | | 1989 | | 40 yrs. |
| 1902 Cypress Lake Drive | | Orlando, FL | | | — | | | | 523,512 | | | | 3,191,790 | | | | 880,341 | | | | 538,512 | | | | 4,057,131 | | | | 4,595,643 | | | | 1,116,154 | | | 1989 | | 40 yrs. |
| 9550 Satellite Boulevard | | Orlando, FL | | | — | | | | 574,831 | | | | — | | | | 2,330,526 | | | | 587,319 | | | | 2,318,038 | | | | 2,905,357 | | | | 594,480 | | | 1999 | | 40 yrs. |
| 10511 & 10611 Satellite Boulevard | | Orlando, FL | | | — | | | | 517,554 | | | | 2,568,186 | | | | 405,635 | | | | 522,991 | | | | 2,968,384 | | | | 3,491,375 | | | | 848,378 | | | 1985 | | 40 yrs. |
| 1400-1440 Central Florida Parkway | | Orlando, FL | | | — | | | | 518,043 | | | | 2,561,938 | | | | 337,852 | | | | 518,043 | | | | 2,899,790 | | | | 3,417,833 | | | | 713,673 | | | 1962 | | 40 yrs. |
| 2216 Directors Row | | Orlando, FL | | | — | | | | 453,918 | | | | 2,572,202 | | | | 27,479 | | | | 453,918 | | | | 2,599,681 | | | | 3,053,599 | | | | 555,992 | | | 1998 | | 40 yrs. |
| 3701-3727 Vineland Road | | Orlando, FL | | | — | | | | 767,929 | | | | 2,096,504 | | | | 430,124 | | | | 767,929 | | | | 2,526,628 | | | | 3,294,557 | | | | 549,972 | | | 1985 | | 40 yrs. |
| 2400 South Lake Orange Drive | | Orlando, FL | | | — | | | | 385,964 | | | | — | | | | 2,461,057 | | | | 642,427 | | | | 2,204,594 | | | | 2,847,021 | | | | 355,814 | | | 2001 | | 40 yrs. |
| 6501 Lee Vista Boulevard | | Orlando, FL | | | — | | | | 903,701 | | | | — | | | | 5,560,142 | | | | 925,671 | | | | 5,538,172 | | | | 6,463,843 | | | | 746,789 | | | 2001 | | 40 yrs. |
| 2416 Lake Orange Drive | | Orlando, FL | | | — | | | | 535,964 | | | | — | | | | 3,166,980 | | | | 704,800 | | | | 2,998,143 | | | | 3,702,944 | | | | 741,196 | | | 2002 | | 40 yrs. |
| 10771 Palm Bay Drive | | Orlando, FL | | | — | | | | 664,605 | | | | — | | | | 2,362,814 | | | | 685,383 | | | | 2,342,035 | | | | 3,027,419 | | | | 299,543 | | | 2001 | | 40 yrs. |
| 10003 Satellite Boulevard | | Orlando, FL | | | — | | | | 680,312 | | | | 2,120,754 | | | | 1,498,831 | | | | 680,312 | | | | 3,619,585 | | | | 4,299,897 | | | | 366,260 | | | 2003 | | 40 yrs. |
| 1090 Gills Drive | | Orlando, FL | | | — | | | | 878,320 | | | | 2,558,833 | | | | 1,872,262 | | | | 878,320 | | | | 4,431,096 | | | | 5,309,415 | | | | 310,566 | | | 2003 | | 40 yrs. |
| 2202 Taft-Vineland Road | | Orlando, FL | | | — | | | | — | | | | — | | | | 6,630,654 | | | | 1,283,713 | | | | 5,346,941 | | | | 6,630,654 | | | | 565,267 | | | 2004 | | 40 yrs. |
| South Center Land-Phase II | | Orlando, FL | | | — | | | | 838,853 | | | | — | | | | 4,047,910 | | | | 767,953 | | | | 4,118,811 | | | | 4,886,763 | | | | 36,846 | | | 2006 | | 40 yrs. |
| 7315 Kingspointe Parkway | | Orlando, FL | | | — | | | | 1,931,697 | | | | 6,388,203 | | | | 2,479,134 | | | | 1,932,004 | | | | 8,867,030 | | | | 10,799,034 | | | | 589,186 | | | 2004 | | 40 yrs. |
| 2351 Investors Row | | Orlando, FL | | | — | | | | 2,261,924 | | | | 7,496,249 | | | | 124,169 | | | | 2,263,211 | | | | 7,619,131 | | | | 9,882,342 | | | | 376,159 | | | 2004 | | 40 yrs. |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2256 Taft-Vineland Road | | Orlando, FL | | | — | | | | 467,296 | | | | — | | | | 2,462,307 | | | | 825,673 | | | | 2,103,930 | | | | 2,929,603 | | | | 104,125 | | | 2005 | | 40 yrs. |
| 1950 Summit Park Drive | | Orlando, FL | | | — | | | | 2,573,700 | | | | 17,478,646 | | | | 531,233 | | | | 2,583,667 | | | | 17,999,912 | | | | 20,583,579 | | | | 791,297 | | | 2005 | | 40 yrs. |
| 1958 Summit Park Drive | | Orlando, FL | | | — | | | | 2,573,961 | | | | 11,206,937 | | | | 8,761,919 | | | | 2,583,216 | | | | 19,959,601 | | | | 22,542,817 | | | | 892,725 | | | 2005 | | 40 yrs. |
| 6200 Lee Vista Boulevard | | Orlando, FL | | | — | | | | 1,423,584 | | | | 6,399,510 | | | | 84,494 | | | | 1,435,301 | | | | 6,472,287 | | | | 7,907,588 | | | | 67,921 | | | 2006 | | 40 yrs. |
| 7022 TPC Drive | | Orlando, FL | | | — | | | | 1,443,510 | | | | 6,845,559 | | | | 357,904 | | | | 1,457,286 | | | | 7,189,688 | | | | 8,646,973 | | | | — | | | 2006 | | 40 yrs. |
| 7100 TPC Drive | | Orlando, FL | | | — | | | | 1,431,489 | | | | 7,948,341 | | | | 203,122 | | | | 1,445,807 | | | | 8,137,144 | | | | 9,582,951 | | | | — | | | 2006 | | 40 yrs. |
| 7101 TPC Drive | | Orlando, FL | | | — | | | | 1,553,537 | | | | 5,301,499 | | | | 225,850 | | | | 1,570,863 | | | | 5,510,023 | | | | 7,080,886 | | | | — | | | 2006 | | 40 yrs. |
| N26 W23445 Paul Road | | Pewaukee, WI | | | — | | | | 561,904 | | | | 1,928,064 | | | | 113,241 | | | | 561,904 | | | | 2,041,305 | | | | 2,603,209 | | | | 357,110 | | | 1985 | | 40 yrs. |
| 8801 Tinicum Boulevard | | Philadelphia, PA | | | — | | | | 2,474,031 | | | | — | | | | 43,598,952 | | | | 125,087 | | | | 45,947,896 | | | | 46,072,983 | | | | 12,300,012 | | | 1997 | | 40 yrs. |
| 3 Franklin Plaza | | Philadelphia, PA | | | — | | | | 2,483,144 | | | | — | | | | 32,150,134 | | | | 2,514,519 | | | | 32,118,759 | | | | 34,633,278 | | | | 6,127,052 | | | 1999 | | 40 yrs. |
| 4751 League Island Boulevard | | Philadelphia, PA | | | — | | | | 992,965 | | | | 331,924 | | | | 6,753,197 | | | | 1,022,081 | | | | 7,056,006 | | | | 8,078,087 | | | | 573,955 | | | 2003 | | 40 yrs. |
| 1 Crescent Drive | | Philadelphia, PA | | | — | | | | 567,280 | | | | — | | | | 12,752,342 | | | | 347,892 | | | | 12,971,730 | | | | 13,319,622 | | | | 57,493 | | | 2004 | | 40 yrs. |
| 9801 80th Avenue | | Pleasant Prairie, WI | | | — | | | | 1,692,077 | | | | 7,934,794 | | | | 62,495 | | | | 1,689,726 | | | | 7,999,640 | | | | 9,689,366 | | | | 1,617,933 | | | 1994 | | 40 yrs. |
| 2250 Hickory Road | | Plymouth Meeting, PA | | | — | | | | 1,015,851 | | | | 9,175,555 | | | | 2,338,832 | | | | 1,032,507 | | | | 11,497,732 | | | | 12,530,239 | | | | 2,838,418 | | | 1985 | | 40 yrs. |
| 2905 Northwest Boulevard | | Plymouth, MN | | | — | | | | 516,920 | | | | 4,646,342 | | | | 1,702,547 | | | | 516,920 | | | | 6,348,890 | | | | 6,865,809 | | | | 1,853,696 | | | 1983 | | 40 yrs. |
| 2800 Campus Drive | | Plymouth, MN | | | — | | | | 395,366 | | | | 3,554,512 | | | | 1,008,452 | | | | 395,366 | | | | 4,562,964 | | | | 4,958,330 | | | | 1,357,056 | | | 1985 | | 40 yrs. |
| 2955 Xenium Lane | | Plymouth, MN | | | — | | | | 151,238 | | | | 1,370,140 | | | | 401,075 | | | | 151,238 | | | | 1,771,215 | | | | 1,922,453 | | | | 605,963 | | | 1985 | | 40 yrs. |
| 2920 Northwest Boulevard | | Plymouth, MN | | | — | | | | 392,026 | | | | 3,433,678 | | | | 655,417 | | | | 384,235 | | | | 4,096,886 | | | | 4,481,121 | | | | 1,151,892 | | | 1997 | | 40 yrs. |
| 14630-14650 28th Avenue North | | Plymouth, MN | | | — | | | | 198,205 | | | | 1,793,422 | | | | 644,591 | | | | 198,205 | | | | 2,438,013 | | | | 2,636,218 | | | | 669,648 | | | 1978 | | 40 yrs. |
| 2800 Northwest Boulevard | | Plymouth, MN | | | — | | | | 1,934,438 | | | | 10,952,503 | | | | 484,440 | | | | 1,934,438 | | | | 11,436,943 | | | | 13,371,380 | | | | 2,695,022 | | | 1995 | | 40 yrs. |
| 9600 54th Avenue | | Plymouth, MN | | | — | | | | 332,317 | | | | 3,077,820 | | | | 1,075,534 | | | | 332,317 | | | | 4,153,354 | | | | 4,485,671 | | | | 931,060 | | | 1998 | | 40 yrs. |
| 1500 SW 5th Court | | Pompano Beach, FL | | | — | | | | 972,232 | | | | 3,892,085 | | | | 245,724 | | | | 972,232 | | | | 4,137,810 | | | | 5,110,041 | | | | 987,730 | | | 1957 | | 40 yrs. |
| 1651 SW 5th Court | | Pompano Beach, FL | | | — | | | | 203,247 | | | | 811,093 | | | | 126,108 | | | | 203,247 | | | | 937,202 | | | | 1,140,449 | | | | 283,351 | | | 1990 | | 40 yrs. |
| 1601 SW 5th Court | | Pompano Beach, FL | | | — | | | | 203,247 | | | | 811,093 | | | | 403,403 | | | | 203,247 | | | | 1,214,496 | | | | 1,417,743 | | | | 301,897 | | | 1990 | | 40 yrs. |
| 1501 SW 5th Court | | Pompano Beach, FL | | | — | | | | 203,247 | | | | 811,093 | | | | 40,396 | | | | 203,247 | | | | 851,489 | | | | 1,054,737 | | | | 204,419 | | | 1990 | | 40 yrs. |
| 1400 SW 6th Court | | Pompano Beach, FL | | | — | | | | 1,157,049 | | | | 4,620,956 | | | | 308,055 | | | | 1,157,049 | | | | 4,929,010 | | | | 6,086,060 | | | | 1,155,658 | | | 1986 | | 40 yrs. |
| 1405 SW 6th Court | | Pompano Beach, FL | | | — | | | | 392,138 | | | | 1,565,787 | | | | 126,972 | | | | 392,138 | | | | 1,692,759 | | | | 2,084,897 | | | | 403,837 | | | 1985 | | 40 yrs. |
| 595 SW 13th Terrace | | Pompano Beach, FL | | | — | | | | 359,933 | | | | 1,437,116 | | | | 95,541 | | | | 359,933 | | | | 1,532,657 | | | | 1,892,590 | | | | 356,011 | | | 1984 | | 40 yrs. |
| 601 SW 13th Terrace | | Pompano Beach, FL | | | — | | | | 164,413 | | | | 655,933 | | | | 151,781 | | | | 164,413 | | | | 807,714 | | | | 972,127 | | | | 184,683 | | | 1984 | | 40 yrs. |
| 605 SW 16th Terrace | | Pompano Beach, FL | | | — | | | | 310,778 | | | | 1,238,324 | | | | 307,582 | | | | 310,178 | | | | 1,546,507 | | | | 1,856,684 | | | | 319,660 | | | 1965 | | 40 yrs. |
| 4300 Carolina Avenue | | Richmond, VA | | | — | | | | 2,007,717 | | | | 14,927,608 | | | | 555,417 | | | | 2,009,136 | | | | 15,481,606 | | | | 17,490,742 | | | | 4,505,494 | | | 1985 | | 40 yrs. |
| 301 Hill Carter Parkway | | Richmond, VA | | | — | | | | 659,456 | | | | 4,836,010 | | | | 625 | | | | 659,456 | | | | 4,836,635 | | | | 5,496,091 | | | | 1,430,892 | | | 1989 | | 40 yrs. |
| 4001 Carolina Avenue | | Richmond, VA | | | — | | | | 29,443 | | | | 215,914 | | | | 305,691 | | | | 29,443 | | | | 521,605 | | | | 551,048 | | | | 122,714 | | | 1935 | | 40 yrs. |
| 5600-5626 Eastport Boulevard | | Richmond, VA | | | — | | | | 489,941 | | | | 3,592,900 | | | | 389,883 | | | | 489,941 | | | | 3,982,783 | | | | 4,472,724 | | | | 1,217,321 | | | 1989 | | 40 yrs. |
| 5650-5674 Eastport Boulevard | | Richmond, VA | | | — | | | | 644,384 | | | | 4,025,480 | | | | 235,079 | | | | 644,384 | | | | 4,260,559 | | | | 4,904,943 | | | | 1,393,734 | | | 1990 | | 40 yrs. |
| 5700 Eastport Boulevard | | Richmond, VA | | | — | | | | 408,729 | | | | 2,697,348 | | | | 803,670 | | | | 408,729 | | | | 3,501,018 | | | | 3,909,747 | | | | 984,143 | | | 1990 | | 40 yrs. |
| 4101-4127 Carolina Avenue | | Richmond, VA | | | — | | | | 310,854 | | | | 2,279,597 | | | | 567,636 | | | | 310,854 | | | | 2,847,233 | | | | 3,158,087 | | | | 768,190 | | | 1973 | | 40 yrs. |
| 4201-4261 Carolina Avenue | | Richmond, VA | | | — | | | | 693,203 | | | | 5,083,493 | | | | 1,305,385 | | | | 693,203 | | | | 6,388,878 | | | | 7,082,081 | | | | 1,911,966 | | | 1975 | | 40 yrs. |
| 4263-4299 Carolina Avenue | | Richmond, VA | | | — | | | | 256,203 | | | | 2,549,649 | | | | 1,647,276 | | | | 256,203 | | | | 4,196,925 | | | | 4,453,128 | | | | 1,163,759 | | | 1976 | | 40 yrs. |
| 4301-4335 Carolina Avenue | | Richmond, VA | | | — | | | | 223,696 | | | | 1,640,435 | | | | 1,920,216 | | | | 223,696 | | | | 3,560,651 | | | | 3,784,347 | | | | 546,076 | | | 1978 | | 40 yrs. |
| 4337-4379 Carolina Avenue | | Richmond, VA | | | — | | | | 325,303 | | | | 2,385,557 | | | | 880,278 | | | | 325,303 | | | | 3,265,835 | | | | 3,591,138 | | | | 1,282,851 | | | 1979 | | 40 yrs. |
| 4501-4549 Carolina Avenue | | Richmond, VA | | | — | | | | 486,166 | | | | 3,565,211 | | | | 471,129 | | | | 486,166 | | | | 4,036,340 | | | | 4,522,506 | | | | 1,177,796 | | | 1981 | | 40 yrs. |
| 4551-4593 Carolina Avenue | | Richmond, VA | | | — | | | | 474,360 | | | | 3,478,646 | | | | 272,695 | | | | 474,360 | | | | 3,751,341 | | | | 4,225,701 | | | | 1,087,264 | | | 1982 | | 40 yrs. |
| 4601-4643 Carolina Avenue | | Richmond, VA | | | — | | | | 652,455 | | | | 4,784,675 | | | | 507,154 | | | | 652,455 | | | | 5,291,829 | | | | 5,944,284 | | | | 1,738,991 | | | 1985 | | 40 yrs. |
| 4645-4683 Carolina Avenue | | Richmond, VA | | | — | | | | 404,616 | | | | 2,967,187 | | | | 1,079,890 | | | | 404,616 | | | | 4,047,077 | | | | 4,451,693 | | | | 1,760,935 | | | 1985 | | 40 yrs. |
| 4447-4491 Carolina Avenue | | Richmond, VA | | | — | | | | 454,056 | | | | 2,729,742 | | | | 293,897 | | | | 454,056 | | | | 3,023,639 | | | | 3,477,695 | | | | 958,366 | | | 1987 | | 40 yrs. |
| 4401-4445 Carolina Avenue | | Richmond, VA | | | — | | | | 615,038 | | | | 4,510,272 | | | | 397,983 | | | | 615,038 | | | | 4,908,255 | | | | 5,523,293 | | | | 1,459,049 | | | 1988 | | 40 yrs. |
| 2300 East Parham Road | | Richmond, VA | | | — | | | | 221,947 | | | | 1,011,088 | | | | 2,443 | | | | 221,947 | | | | 1,013,531 | | | | 1,235,478 | | | | 325,610 | | | 1988 | | 40 yrs. |
| 5601-5659 Eastport Boulevard | | Richmond, VA | | | * | | | | 705,660 | | | | — | | | | 4,718,370 | | | | 720,100 | | | | 4,703,930 | | | | 5,424,030 | | | | 1,653,017 | | | 1996 | | 40 yrs. |
| 5900 Eastport Boulevard | | Richmond, VA | | | — | | | | 676,661 | | | | — | | | | 4,818,232 | | | | 687,898 | | | | 4,806,995 | | | | 5,494,893 | | | | 1,265,045 | | | 1997 | | 40 yrs. |
| 4717-4729 Eubank Road | | Richmond, VA | | | * | | | | 449,447 | | | | 3,294,697 | | | | 546,131 | | | | 452,263 | | | | 3,838,011 | | | | 4,290,274 | | | | 1,127,629 | | | 1978 | | 40 yrs. |
| 4263F-N. Carolina Avenue | | Richmond, VA | | | — | | | | 91,476 | | | | — | | | | 1,643,294 | | | | 91,599 | | | | 1,643,171 | | | | 1,734,770 | | | | 446,236 | | | 1975 | | 40 yrs. |
| 510 Eastpark Court | | Richmond, VA | | | — | | | | 261,961 | | | | 2,110,874 | | | | 316,688 | | | | 262,210 | | | | 2,427,312 | | | | 2,689,523 | | | | 800,917 | | | 1989 | | 40 yrs. |
| 520 Eastpark Court | | Richmond, VA | | | — | | | | 486,118 | | | | 4,083,582 | | | | 336,701 | | | | 486,598 | | | | 4,419,803 | | | | 4,906,401 | | | | 1,203,497 | | | 1989 | | 40 yrs. |
| 5701-5799 Eastport Boulevard | | Richmond, VA | | | — | | | | 694,644 | | | | — | | | | 5,651,198 | | | | 700,503 | | | | 5,645,340 | | | | 6,345,842 | | | | 1,630,865 | | | 1998 | | 40 yrs. |
| 530 Eastpark Court | | Richmond, VA | | | — | | | | 266,883 | | | | — | | | | 3,068,901 | | | | 334,772 | | | | 3,001,012 | | | | 3,335,784 | | | | 1,026,669 | | | 1999 | | 40 yrs. |
| 3829-3855 Gaskins Road | | Richmond, VA | | | — | | | | 364,165 | | | | 3,264,114 | | | | 39,764 | | | | 364,165 | | | | 3,303,879 | | | | 3,668,044 | | | | 728,169 | | | 1988 | | 40 yrs. |
| 10800 Nuckols Boulevard | | Richmond, VA | | | — | | | | 1,432,462 | | | | — | | | | 14,420,839 | | | | 1,794,162 | | | | 14,059,139 | | | | 15,853,301 | | | | 2,428,731 | | | 2000 | | 40 yrs. |
| 100 Westgate Parkway | | Richmond, VA | | | — | | | | 1,140,648 | | | | 101,824 | | | | 8,408,649 | | | | 1,456,084 | | | | 8,195,037 | | | | 9,651,121 | | | | 1,230,590 | | | 2001 | | 40 yrs. |
| 200 Westgate Parkway | | Richmond, VA | | | — | | | | 1,623,612 | | | | — | | | | 5,900,380 | | | | 1,072,797 | | | | 6,451,195 | | | | 7,523,992 | | | | 923,936 | | | 2002 | | 40 yrs. |
| 1001 Boulders Parkway | | Richmond, VA | | | — | | | | 2,073,739 | | | | 5,634,796 | | | | 892,592 | | | | 2,079,643 | | | | 6,521,484 | | | | 8,601,127 | | | | 257,425 | | | 2005 | | 40 yrs. |
| 7400 Beaufont Springs Drive | | Richmond, VA | | | — | | | | 808,581 | | | | 7,273,850 | | | | 837,566 | | | | 810,743 | | | | 8,109,253 | | | | 8,919,996 | | | | 304,103 | | | 2005 | | 40 yrs. |
| 1100 Boulders Parkway | | Richmond, VA | | | — | | | | 1,276,936 | | | | 12,052,192 | | | | 709,835 | | | | 1,280,662 | | | | 12,758,301 | | | | 14,038,963 | | | | 181,763 | | | 2005 | | 40 yrs. |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12 S. Third Street | | Richmond, VA | | | — | | | | 40,539 | | | | 184,682 | | | | 14,061 | | | | 40,539 | | | | 198,743 | | | | 239,282 | | | | 57,182 | | | 1900 | | 40 yrs. |
| 2020 US Highway 301 South | | Riverview, FL | | | — | | | | 1,233,639 | | | | 13,608,485 | | | | 1,144 | | | | 1,233,800 | | | | 13,609,469 | | | | 14,843,268 | | | | 158,254 | | | 2006 | | 40 yrs. |
| 6532 Judge Adams Road | | Rock Creek, NC | | | — | | | | 354,903 | | | | — | | | | 3,740,561 | | | | 399,988 | | | | 3,695,477 | | | | 4,095,464 | | | | 996,239 | | | 1997 | | 40 yrs. |
| 6530 Judge Adams Road | | Rock Creek, NC | | | — | | | | 305,821 | | | | — | | | | 4,458,256 | | | | 335,061 | | | | 4,429,015 | | | | 4,764,076 | | | | 903,045 | | | 1999 | | 40 yrs. |
| 6509 Franz Warner Parkway | | Rock Creek, NC | | | — | | | | 360,494 | | | | — | | | | 2,829,679 | | | | 372,494 | | | | 2,817,679 | | | | 3,190,173 | | | | 506,475 | | | 2001 | | 40 yrs. |
| 38100 Ecorse Road | | Romulus, MI | | | — | | | | 955,063 | | | | — | | | | 8,900,259 | | | | 853,063 | | | | 9,002,259 | | | | 9,855,322 | | | | 1,360,828 | | | 2000 | | 40 yrs. |
| 38000 Ecourse Road | | Romulus, MI | | | — | | | | 807,660 | | | | — | | | | 12,732,352 | | | | 1,053,337 | | | | 12,486,675 | | | | 13,540,012 | | | | 2,529,890 | | | 2001 | | 40 yrs. |
| 6505 Cogswell Road | | Romulus, MI | | | — | | | | 594,523 | | | | — | | | | 17,282,074 | | | | 4,195,047 | | | | 13,681,551 | | | | 17,876,598 | | | | 2,078 | | | 2005 | | 40 yrs. |
| 38100 Ecorse Road Expansion | | Romulus, MI | | | — | | | | — | | | | — | | | | 1,538,262 | | | | — | | | | 1,538,262 | | | | 1,538,262 | | | | 28,999 | | | 2005 | | 40 yrs. |
| 8501 East Raintree Drive | | Scottsdale, AZ | | | — | | | | 4,076,412 | | | | — | | | | 27,576,974 | | | | 4,115,137 | | | | 27,538,249 | | | | 31,653,386 | | | | 459,720 | | | 2005 | | 40 yrs. |
| 26911-26957 Northwestern Highway | | Southfield, MI | | | — | | | | 7,799,515 | | | | 66,268,817 | | | | 8,771,128 | | | | 7,799,515 | | | | 75,039,945 | | | | 82,839,460 | | | | 18,643,965 | | | 1985 | | 40 yrs. |
| 6950 Harbor View Blvd | | Suffolk, VA | | | — | | | | 929,844 | | | | — | | | | 6,197,285 | | | | 794,848 | | | | 6,332,282 | | | | 7,127,129 | | | | 96,284 | | | 2004 | | 40 yrs. |
| 13650 NW 8th Street | | Sunrise, FL | | | — | | | | 558,223 | | | | 2,171,930 | | | | 99,234 | | | | 558,251 | | | | 2,271,136 | | | | 2,829,387 | | | | 624,170 | | | 1991 | | 40 yrs. |
| 13630 NW 8th Street | | Sunrise, FL | | | — | | | | 659,797 | | | | 2,596,275 | | | | 772,671 | | | | 659,825 | | | | 3,368,917 | | | | 4,028,742 | | | | 883,443 | | | 1991 | | 40 yrs. |
| 1301 International Parkway | | Sunrise, FL | | | — | | | | 5,100,162 | | | | 24,219,956 | | | | 1,264,535 | | | | 5,100,791 | | | | 25,483,861 | | | | 30,584,653 | | | | — | | | 2006 | | 40 yrs. |
| 5501-5519 Pioneer Park Boulevard | | Tampa, FL | | | — | | | | 162,000 | | | | 1,613,000 | | | | 637,115 | | | | 262,416 | | | | 2,149,700 | | | | 2,412,115 | | | | 605,615 | | | 1981 | | 40 yrs. |
| 5690-5694 Crenshaw Street | | Tampa, FL | | | — | | | | 181,923 | | | | 1,812,496 | | | | 217,470 | | | | 181,923 | | | | 2,029,967 | | | | 2,211,890 | | | | 598,290 | | | 1979 | | 40 yrs. |
| 3102,3104,3110 Cherry Palm Drive | | Tampa, FL | | | — | | | | 503,767 | | | | 2,787,585 | | | | 1,948,416 | | | | 982,207 | | | | 4,257,561 | | | | 5,239,768 | | | | 1,234,238 | | | 1986 | | 40 yrs. |
| 8401-8408 Benjamin Road | | Tampa, FL | | | — | | | | 789,651 | | | | 4,454,648 | | | | 1,974,397 | | | | 769,789 | | | | 6,448,907 | | | | 7,218,696 | | | | 2,203,217 | | | 1986 | | 40 yrs. |
| 3501 Riga Boulevard | | Tampa, FL | | | — | | | | 617,289 | | | | 3,048,379 | | | | 454,271 | | | | 617,289 | | | | 3,502,650 | | | | 4,119,939 | | | | 1,026,027 | | | 1987 | | 40 yrs. |
| 111 Kelsey Lane | | Tampa, FL | | | — | | | | 359,540 | | | | 1,461,850 | | | | 934,298 | | | | 359,540 | | | | 2,396,148 | | | | 2,755,688 | | | | 729,735 | | | 1990 | | 40 yrs. |
| 7930, 8010-20 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 1,408,478 | | | | 5,247,246 | | | | 911,481 | | | | 1,408,478 | | | | 6,158,727 | | | | 7,567,205 | | | | 1,671,637 | | | 1990 | | 40 yrs. |
| 7920 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 1,382,648 | | | | 2,445,444 | | | | (276,436 | ) | | | 1,082,648 | | | | 2,469,008 | | | | 3,551,656 | | | | 607,836 | | | 1997 | | 40 yrs. |
| 8154-8198 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 399,088 | | | | 2,868,834 | | | | 441,572 | | | | 399,088 | | | | 3,310,406 | | | | 3,709,494 | | | | 967,807 | | | 1988 | | 40 yrs. |
| 8112-42 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 513,263 | | | | 3,230,239 | | | | 662,940 | | | | 513,263 | | | | 3,893,180 | | | | 4,406,442 | | | | 889,518 | | | 1995 | | 40 yrs. |
| 8212 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 820,882 | | | | 2,322,720 | | | | 14,210 | | | | 820,882 | | | | 2,336,931 | | | | 3,157,813 | | | | 563,816 | | | 1996 | | 40 yrs. |
| 131 Kelsey Lane | | Tampa, FL | | | — | | | | 511,463 | | | | — | | | | 4,455,291 | | | | 559,527 | | | | 4,407,227 | | | | 4,966,754 | | | | 1,699,463 | | | 1985 | | 40 yrs. |
| 7724 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 235,893 | | | | — | | | | 2,285,235 | | | | 235,894 | | | | 2,285,234 | | | | 2,521,128 | | | | 611,383 | | | 1998 | | 40 yrs. |
| 7802-50 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 357,364 | | | | — | | | | 2,711,761 | | | | 506,949 | | | | 2,562,177 | | | | 3,069,125 | | | | 1,019,925 | | | 1999 | | 40 yrs. |
| 7852-98 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 357,364 | | | | — | | | | 2,708,532 | | | | 506,949 | | | | 2,558,947 | | | | 3,065,896 | | | | 965,711 | | | 1999 | | 40 yrs. |
| 8921 Brittany Way | | Tampa, FL | | | — | | | | 224,369 | | | | 1,063,882 | | | | 965,576 | | | | 254,493 | | | | 1,999,334 | | | | 2,253,827 | | | | 446,634 | | | 1998 | | 40 yrs. |
| 5250 Eagle Trail Drive | | Tampa, FL | | | — | | | | 952,860 | | | | — | | | | 3,581,057 | | | | 952,860 | | | | 3,581,057 | | | | 4,533,916 | | | | 739,406 | | | 1998 | | 40 yrs. |
| 7725 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 553,335 | | | | — | | | | 3,351,584 | | | | 771,501 | | | | 3,133,418 | | | | 3,904,919 | | | | 637,170 | | | 1999 | | 40 yrs. |
| 8001 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 350,406 | | | | — | | | | 2,488,771 | | | | 438,061 | | | | 2,401,117 | | | | 2,839,178 | | | | 517,144 | | | 1999 | | 40 yrs. |
| 4630 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | 943,169 | | | | — | | | | 12,592,708 | | | | 1,560,099 | | | | 11,975,778 | | | | 13,535,877 | | | | 2,279,782 | | | 2000 | | 40 yrs. |
| 701-725 South US Hwy 301 | | Tampa, FL | | | — | | | | 419,683 | | | | — | | | | 3,817,508 | | | | 661,680 | | | | 3,575,511 | | | | 4,237,191 | | | | 1,130,146 | | | 2000 | | 40 yrs. |
| 4502 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | — | | | | — | | | | 4,005,900 | | | | 1,071,535 | | | | 2,934,365 | | | | 4,005,900 | | | | 528,300 | | | 1999 | | 40 yrs. |
| 9001-9015 Brittany Way | | Tampa, FL | | | — | | | | 209,841 | | | | — | | | | 1,575,906 | | | | 364,514 | | | | 1,421,234 | | | | 1,785,748 | | | | 334,370 | | | 2000 | | 40 yrs. |
| 4508 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | 498,598 | | | | — | | | | 3,057,752 | | | | 556,887 | | | | 2,999,463 | | | | 3,556,350 | | | | 573,747 | | | 2000 | | 40 yrs. |
| 7622 Bald Cypress Place | | Tampa, FL | | | — | | | | — | | | | — | | | | 1,305,584 | | | | 300,000 | | | | 1,005,584 | | | | 1,305,584 | | | | 171,340 | | | 2000 | | 40 yrs. |
| 901-933 US Highway 301 South | | Tampa, FL | | | — | | | | 500,391 | | | | — | | | | 4,032,028 | | | | 840,314 | | | | 3,692,105 | | | | 4,532,419 | | | | 978,648 | | | 2001 | | 40 yrs. |
| 4503 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | — | | | | — | | | | 3,454,328 | | | | 619,913 | | | | 2,834,415 | | | | 3,454,328 | | | | 414,660 | | | 2002 | | 40 yrs. |
| 4505 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | — | | | | — | | | | 3,110,391 | | | | 716,594 | | | | 2,393,797 | | | | 3,110,391 | | | | 528,279 | | | 2002 | | 40 yrs. |
| 4511 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | — | | | | — | | | | 2,840,466 | | | | 686,594 | | | | 2,153,872 | | | | 2,840,466 | | | | 386,162 | | | 2002 | | 40 yrs. |
| 7621 Bald Cypress Place (Bldg N) | | Tampa, FL | | | — | | | | — | | | | — | | | | 1,482,613 | | | | 447,498 | | | | 1,035,115 | | | | 1,482,613 | | | | 121,194 | | | 2001 | | 40 yrs. |
| 4520 Seedling Circle | | Tampa, FL | | | — | | | | 854,797 | | | | 42,131 | | | | 2,721,233 | | | | 854,797 | | | | 2,763,364 | | | | 3,618,161 | | | | 185,881 | | | 2003 | | 40 yrs. |
| 501 US Highway 301 South | | Tampa, FL | | | — | | | | 898,884 | | | | — | | | | 3,499,853 | | | | 900,508 | | | | 3,498,229 | | | | 4,398,737 | | | | 261,909 | | | 2004 | | 40 yrs. |
| 9002-9036 Brittany Way | | Tampa, FL | | | — | | | | 492,320 | | | | — | | | | 3,964,055 | | | | 899,284 | | | | 3,557,092 | | | | 4,456,375 | | | | 343,327 | | | 2004 | | 40 yrs. |
| 8900-34 Brittany Was | | Tampa, FL | | | — | | | | 537,194 | | | | — | | | | 4,248,195 | | | | 978,019 | | | | 3,807,371 | | | | 4,785,389 | | | | 14,913 | | | 2005 | | 40 yrs. |
| 200-34 Kelsey Lane | | Tampa, FL | | | — | | | | 330,097 | | | | — | | | | 3,623,009 | | | | 933,362 | | | | 3,019,744 | | | | 3,953,106 | | | | 90,303 | | | 2005 | | 40 yrs. |
| 8725 Henderson Road | | Tampa, FL | | | — | | | | 3,171,906 | | | | 19,126,156 | | | | (3,957 | ) | | | 3,167,787 | | | | 19,126,318 | | | | 22,294,105 | | | | 162,502 | | | 2006 | | 40 yrs. |
| 8735 Henderson Road | | Tampa, FL | | | — | | | | 3,170,247 | | | | 18,749,873 | | | | (18,416 | ) | | | 3,166,130 | | | | 18,735,573 | | | | 21,901,703 | | | | 160,241 | | | 2006 | | 40 yrs. |
| 8705 Henderson Road | | Tampa, FL | | | — | | | | 4,309,467 | | | | 23,688,189 | | | | 21,765 | | | | 4,303,870 | | | | 23,715,550 | | | | 28,019,421 | | | | 299,401 | | | 2006 | | 40 yrs. |
| 8715 Henderson Road | | Tampa, FL | | | — | | | | 3,348,258 | | | | 18,325,427 | | | | (4,177 | ) | | | 3,343,910 | | | | 18,325,599 | | | | 21,669,509 | | | | 133,957 | | | 2006 | | 40 yrs. |
| 8745 Henderson Road | | Tampa, FL | | | — | | | | 2,053,105 | | | | 11,158,441 | | | | 11,901 | | | | 2,050,439 | | | | 11,173,008 | | | | 13,223,447 | | | | 95,859 | | | 2006 | | 40 yrs. |
| 7851-7861 Woodland Center Blvd | | Tampa, FL | | | — | | | | 549,043 | | | | 2,242,204 | | | | 95,559 | | | | 548,905 | | | | 2,337,901 | | | | 2,886,806 | | | | 17,050 | | | 2006 | | 40 yrs. |
| 1650 Research Drive | | Troy, MI | | | — | | | | 763,067 | | | | 7,201,677 | | | | 1,328,964 | | | | 763,067 | | | | 8,530,641 | | | | 9,293,708 | | | | 1,885,343 | | | 1985 | | 40 yrs. |
| 1775 Research Drive | | Troy, MI | | | — | | | | 331,422 | | | | 2,788,073 | | | | 648,020 | | | | 331,422 | | | | 3,436,093 | | | | 3,767,515 | | | | 789,861 | | | 1985 | | 40 yrs. |
| 1875 Research Drive | | Troy, MI | | | — | | | | 329,863 | | | | 2,774,006 | | | | 378,366 | | | | 329,863 | | | | 3,152,372 | | | | 3,482,235 | | | | 747,631 | | | 1986 | | 40 yrs. |
| 1850 Research Drive | | Troy, MI | | | — | | | | 781,054 | | | | 7,364,300 | | | | 2,083,387 | | | | 781,054 | | | | 9,447,687 | | | | 10,228,741 | | | | 2,340,733 | | | 1986 | | 40 yrs. |
| 1965 Research Drive | | Troy, MI | | | — | | | | 419,090 | | | | 3,578,928 | | | | 346,058 | | | | 419,090 | | | | 3,924,986 | | | | 4,344,077 | | | | 1,054,465 | | | 1987 | | 40 yrs. |
| 1960 Research Drive | | Troy, MI | | | — | | | | 419,146 | | | | 3,579,166 | | | | 635,418 | | | | 419,146 | | | | 4,214,584 | | | | 4,633,730 | | | | 1,115,137 | | | 1987 | | 40 yrs. |
| 1101 Allen Drive | | Troy, MI | | | — | | | | 98,144 | | | | 887,935 | | | | 326,837 | | | | 98,148 | | | | 1,214,768 | | | | 1,312,916 | | | | 450,766 | | | 1974 | | 40 yrs. |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | �� | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 1151 Allen Drive | | Troy, MI | | | — | | | | 164,483 | | | | 1,486,220 | | | | 438,250 | | | | 164,486 | | | | 1,924,467 | | | | 2,088,953 | | | | 529,177 | | | 1974 | | 40 yrs. |
| 1300 Rankin Street | | Troy, MI | | | — | | | | 134,090 | | | | 1,212,752 | | | | 498,931 | | | | 134,094 | | | | 1,711,679 | | | | 1,845,773 | | | | 632,783 | | | 1979 | | 40 yrs. |
| 1350 Rankin Street | | Troy, MI | | | — | | | | 111,776 | | | | 1,011,497 | | | | 168,477 | | | | 111,779 | | | | 1,179,971 | | | | 1,291,750 | | | | 298,176 | | | 1979 | | 40 yrs. |
| 1376-1400 Rankin Street | | Troy, MI | | | — | | | | 134,292 | | | | 1,213,626 | | | | 313,374 | | | | 134,296 | | | | 1,526,996 | | | | 1,661,292 | | | | 384,503 | | | 1979 | | 40 yrs. |
| 1352-1374 Rankin Street | | Troy, MI | | | — | | | | 153,275 | | | | 1,385,098 | | | | 336,226 | | | | 153,279 | | | | 1,721,321 | | | | 1,874,599 | | | | 463,034 | | | 1979 | | 40 yrs. |
| 1324-1346 Rankin Street | | Troy, MI | | | — | | | | 134,090 | | | | 1,212,214 | | | | 161,394 | | | | 134,094 | | | | 1,373,604 | | | | 1,507,698 | | | | 313,707 | | | 1979 | | 40 yrs. |
| 1301-1307 Rankin Street | | Troy, MI | | | — | | | | 111,776 | | | | 1,011,121 | | | | 183,667 | | | | 111,779 | | | | 1,194,785 | | | | 1,306,564 | | | | 284,538 | | | 1978 | | 40 yrs. |
| 1409 Allen Drive | | Troy, MI | | | — | | | | 142,370 | | | | 1,286,048 | | | | 430,773 | | | | 142,374 | | | | 1,716,818 | | | | 1,859,191 | | | | 479,131 | | | 1978 | | 40 yrs. |
| 1334 Maplelawn Road | | Troy, MI | | | — | | | | 124,296 | | | | 1,122,802 | | | | 54,070 | | | | 124,300 | | | | 1,176,868 | | | | 1,301,168 | | | | 275,534 | | | 1983 | | 40 yrs. |
| 1290 Maplelawn Road | | Troy, MI | | | — | | | | 85,321 | | | | 771,621 | | | | 223,628 | | | | 85,325 | | | | 995,245 | | | | 1,080,570 | | | | 231,123 | | | 1984 | | 40 yrs. |
| 1070 Maplelawn Road | | Troy, MI | | | — | | | | 68,560 | | | | 620,595 | | | | 106,856 | | | | 68,563 | | | | 727,447 | | | | 796,011 | | | | 189,305 | | | 1982 | | 40 yrs. |
| 950 Maplelawn Road | | Troy, MI | | | — | | | | 252,429 | | | | 2,265,259 | | | | 181,631 | | | | 252,433 | | | | 2,446,886 | | | | 2,699,319 | | | | 596,700 | | | 1982 | | 40 yrs. |
| 894 Maplelawn Road | | Troy, MI | | | — | | | | 181,749 | | | | 1,632,243 | | | | 763,375 | | | | 181,753 | | | | 2,395,615 | | | | 2,577,367 | | | | 698,188 | | | 1986 | | 40 yrs. |
| 1311-1331 Maplelawn Road | | Troy, MI | | | — | | | | 125,407 | | | | 1,132,810 | | | | 204,037 | | | | 125,410 | | | | 1,336,843 | | | | 1,462,254 | | | | 421,557 | | | 1986 | | 40 yrs. |
| 2354 Bellingham Street | | Troy, MI | | | — | | | | 87,340 | | | | 789,817 | | | | 19,928 | | | | 87,344 | | | | 809,741 | | | | 897,085 | | | | 191,097 | | | 1990 | | 40 yrs. |
| 2360 Bellingham Street | | Troy, MI | | | — | | | | 87,340 | | | | 789,817 | | | | 58,250 | | | | 87,344 | | | | 848,063 | | | | 935,407 | | | | 194,192 | | | 1985 | | 40 yrs. |
| 1600-1630 East Big Beaver Road | | Troy, MI | | | — | | | | 1,454,406 | | | | 2,952,884 | | | | 53,694 | | | | 1,458,737 | | | | 3,002,247 | | | | 4,460,984 | | | | 537,518 | | | 1982 | | 40 yrs. |
| 2600 Bellingham Drive | | Troy, MI | | | — | | | | 1,796,869 | | | | — | | | | 4,095,318 | | | | 1,938,746 | | | | 3,953,441 | | | | 5,892,187 | | | | 1,107,377 | | | 2002 | | 40 yrs. |
| 2710 Bellingham Drive | | Troy, MI | | | — | | | | 1,796,869 | | | | — | | | | 4,721,835 | | | | 1,938,746 | | | | 4,579,958 | | | | 6,518,704 | | | | 1,253,476 | | | 2002 | | 40 yrs. |
| 3432 Holland Road | | Virginia Beach, VA | | | — | | | | 173,527 | | | | 790,515 | | | | 2,462 | | | | 173,527 | | | | 792,977 | | | | 966,504 | | | | 234,111 | | | 1989 | | 40 yrs. |
| 2809 South Lynnhaven Road | | Virginia Beach, VA | | | — | | | | 953,590 | | | | 6,142,742 | | | | 1,100,609 | | | | 953,590 | | | | 7,243,352 | | | | 8,196,941 | | | | 1,822,981 | | | 1987 | | 40 yrs. |
| 200 Golden Oak Court | | Virginia Beach, VA | | | — | | | | 1,116,693 | | | | 6,770,480 | | | | 1,126,390 | | | | 1,116,693 | | | | 7,896,870 | | | | 9,013,562 | | | | 2,005,654 | | | 1988 | | 40 yrs. |
| 208 Golden Oak Court | | Virginia Beach, VA | | | — | | | | 965,177 | | | | 6,728,717 | | | | 1,129,993 | | | | 965,177 | | | | 7,858,710 | | | | 8,823,888 | | | | 2,052,497 | | | 1989 | | 40 yrs. |
| 484 Viking Drive | | Virginia Beach, VA | | | — | | | | 891,753 | | | | 3,607,890 | | | | 553,685 | | | | 891,753 | | | | 4,161,575 | | | | 5,053,327 | | | | 1,028,787 | | | 1987 | | 40 yrs. |
| 629 Phoenix Drive | | Virginia Beach, VA | | | — | | | | 371,694 | | | | 2,108,097 | | | | 243,169 | | | | 371,694 | | | | 2,351,266 | | | | 2,722,960 | | | | 559,043 | | | 1996 | | 40 yrs. |
| 5700 Cleveland Street | | Virginia Beach, VA | | | — | | | | 700,112 | | | | 9,592,721 | | | | 1,917,901 | | | | 700,564 | | | | 11,510,169 | | | | 12,210,734 | | | | 3,008,461 | | | 1989 | | 40 yrs. |
| 1457 Miller Store Road | | Virginia Beach, VA | | | 1,587,598 | | | | 473,689 | | | | 2,663,045 | | | | 603,352 | | | | 474,746 | | | | 3,265,341 | | | | 3,740,086 | | | | 285,752 | | | 2003 | | 40 yrs. |
| 11020 West Plank Court | | Wauwatosa, WI | | | — | | | | 464,246 | | | | 3,230,511 | | | | (519,943 | ) | | | 464,246 | | | | 2,710,568 | | | | 3,174,814 | | | | 533,083 | | | 1985 | | 40 yrs. |
| 825 Duportail Road | | Wayne, PA | | | — | | | | 5,536,619 | | | | 16,179,213 | | | | 1,061,808 | | | | 5,539,281 | | | | 17,238,360 | | | | 22,777,641 | | | | 2,848,284 | | | 1979 | | 40 yrs. |
| 1500 Liberty Ridge | | Wayne, PA | | | — | | | | 8,287,555 | | | | — | | | | 31,280,987 | | | | 11,636,499 | | | | 27,932,043 | | | | 39,568,542 | | | | 4,177,639 | | | 2002 | | 40 yrs. |
| 1200 Liberty Ridge Drive | | Wayne, PA | | | — | | | | 6,215,667 | | | | — | | | | 8,829,577 | | | | 5,223,660 | | | | 9,821,584 | | | | 15,045,244 | | | | 2,393,281 | | | 2001 | | 40 yrs. |
| 11300-90 West Theodore Trecker Way | | West Allis, WI | | | * | | | | 500,565 | | | | 1,591,678 | | | | 630,627 | | | | 505,972 | | | | 2,216,897 | | | | 2,722,870 | | | | 48,651 | | | 2005 | | 40 yrs. |
| 11548 West Theodore Trecker Way | | West Allis, WI | | | * | | | | 660,068 | | | | 4,640,578 | | | | 44,656 | | | | 663,766 | | | | 4,681,537 | | | | 5,345,302 | | | | 181,960 | | | 2005 | | 40 yrs. |
| 11420 West Theodore Trecker Way | | West Allis, WI | | | — | | | | 348,146 | | | | 2,057,483 | | | | 27,202 | | | | 350,008 | | | | 2,082,824 | | | | 2,432,831 | | | | 80,727 | | | 2005 | | 40 yrs. |
| 400-500 Brandywine Parkway | | West Chester, PA | | | — | | | | 845,846 | | | | 6,809,025 | | | | 453,832 | | | | 845,846 | | | | 7,262,857 | | | | 8,108,703 | | | | 1,742,042 | | | 1988 | | 40 yrs. |
| 600 Brandywine Parkway | | West Chester, PA | | | — | | | | 664,899 | | | | 5,352,410 | | | | 842,826 | | | | 664,899 | | | | 6,195,236 | | | | 6,860,135 | | | | 1,575,945 | | | 1988 | | 40 yrs. |
| 905 Airport Road | | West Chester, PA | | | — | | | | 1,715,000 | | | | 5,185,000 | | | | 1,429,527 | | | | 1,735,012 | | | | 6,594,515 | | | | 8,329,527 | | | | 2,301,424 | | | 1988 | | 40 yrs. |
| Liberty Square Retail Blocks | | West Malling, UK | | | — | | | | 559,590 | | | | 5,113,902 | | | | 5,761,846 | | | | 1,408,957 | | | | 10,026,381 | | | | 11,435,338 | | | | 346,459 | | | 2006 | | 40 yrs. |
| 3612 La Grange Parkway | | Williamsburg, VA | | | — | | | | — | | | | — | | | | 5,687,985 | | | | 887,234 | | | | 4,800,752 | | | | 5,687,985 | | | | 284,122 | | | 2003 | | 40 yrs. |
| 7805 Hudson Road | | Woodbury, MN | | | — | | | | 1,279,834 | | | | — | | | | 10,337,053 | | | | 1,385,739 | | | | 10,231,149 | | | | 11,616,887 | | | | 1,940,761 | | | 2002 | | 40 yrs. |
| | | | | | | | | |
| Subtotal Operating Real Estate | | | | $ | 92,401,473 | | | $ | 618,631,316 | | | $ | 1,812,183,416 | | | $ | 2,061,697,505 | | | $ | 678,074,971 | | | $ | 3,814,437,267 | | | $ | 4,492,512,238 | | | $ | 806,308,940 | | | | | |
| | | | | | | | | |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End of Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (years) |
| DEVELOPMENT PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 8400 Industrial Boulevard | | Allentown, PA | | $ | — | | | $ | 6,883,389 | | | $ | — | | | $ | 25,444,359 | | | $ | — | | | $ | 32,327,747 | | | $ | 32,327,747 | | | $ | — | | | 2005 | | N/A |
| 3500 High Point Boulevard | | Bethlehem, PA | | | — | | | | 289,529 | | | | — | | | | 2,143,128 | | | | — | | | | 2,432,657 | | | | 2,432,657 | | | | — | | | 2006 | | N/A |
| 3450 High Point Boulevard | | Bethlehem, PA | | | — | | | | 303,197 | | | | — | | | | 1,897,360 | | | | — | | | | 2,200,557 | | | | 2,200,557 | | | | — | | | 2006 | | N/A |
| 5705 Old Shakopee Road | | Bloomington, MN | | | — | | | | 2,113,223 | | | | — | | | | 1,409,514 | | | | — | | | | 3,522,737 | | | | 3,522,737 | | | | — | | | 2001 | | N/A |
| 8201 Industrial Boulevard | | Breinigsville, PA | | | — | | | | 2,138,635 | | | | — | | | | 887,619 | | | | — | | | | 3,026,254 | | | | 3,026,254 | | | | — | | | 2006 | | N/A |
| 6220 Old Dobbin Lane | | Columbis, MD | | | — | | | | 3,865,848 | | | | — | | | | 3,117,313 | | | | — | | | | 6,983,161 | | | | 6,983,161 | | | | — | | | 2006 | | N/A |
| 7625 Smetana Lane | | Eden Prairie, MN | | | — | | | | 4,500,641 | | | | — | | | | 1,416,645 | | | | — | | | | 5,917,287 | | | | 5,917,287 | | | | — | | | 2006 | | N/A |
| 7351 Coca Cola Drive | | Elkridge, MD | | | — | | | | 1,897,044 | | | | — | | | | 4,722,406 | | | | — | | | | 6,619,450 | | | | 6,619,450 | | | | — | | | 2006 | | N/A |
| 1100 Virginia Drive | | Fort Washington, PA | | | — | | | | 22,612,437 | | | | — | | | | 18,251,084 | | | | — | | | | 40,863,521 | | | | 40,863,521 | | | | — | | | 2006 | | N/A |
| 7 Independence Pointe | | Greenville, SC | | | — | | | | 932,484 | | | | — | | | | 4,353,296 | | | | — | | | | 5,285,780 | | | | 5,285,780 | | | | — | | | 2006 | | N/A |
| 45 Brookfield Oaks Drive | | Greenville, SC | | | — | | | | 818,114 | | | | — | | | | 3,151,403 | | | | — | | | | 3,969,517 | | | | 3,969,517 | | | | — | | | 2006 | | N/A |
| 116 Pleasant Ridge Road | | Greenville, SC | | | — | | | | 1,547,811 | | | | — | | | | 2,740,234 | | | | — | | | | 4,288,045 | | | | 4,288,045 | | | | — | | | 2006 | | N/A |
| 1317 Executive Boulevard | | Hampton, VA | | | — | | | | 1,650,423 | | | | — | | | | 5,221,412 | | | | — | | | | 6,871,836 | | | | 6,871,836 | | | | — | | | 2006 | | N/A |
| 600 Industrial Drive | | Harrisburg, PA | | | — | | | | 7,743,800 | | | | — | | | | 24,665,626 | | | | — | | | | 32,409,426 | | | | 32,409,426 | | | | — | | | 2005 | | N/A |
| 1498 Eagle Hill Drive | | High Point, NC | | | — | | | | 94,274 | | | | — | | | | 5,688,012 | | | | — | | | | 5,782,285 | | | | 5,782,285 | | | | — | | | 2005 | | N/A |
| 4475 Premier Drive | | High Point, NC | | | — | | | | 748,693 | | | | — | | | | 3,600,826 | | | | — | | | | 4,349,519 | | | | 4,349,519 | | | | — | | | 2006 | | N/A |
| 7 Walnut Grove Drive | | Horsham, PA | | | — | | | | 2,631,696 | | | | — | | | | 9,130,339 | | | | — | | | | 11,762,035 | | | | 11,762,035 | | | | — | | | 2006 | | N/A |
| 1646 Rankin Road | | Houston, TX | | | — | | | | 329,961 | | | | — | | | | 4,049,825 | | | | — | | | | 4,379,785 | | | | 4,379,785 | | | | — | | | 2005 | | N/A |
| 330 Fellowship Road | | Mount Laurel, NJ | | | — | | | | 3,730,570 | | | | — | | | | 3,786,447 | | | | — | | | | 7,517,017 | | | | 7,517,017 | | | | — | | | 2006 | | N/A |
| 6923 Lee Vista Boulevard | | Orlando, FL | | | — | | | | 903,701 | | | | — | | | | 2,132,401 | | | | — | | | | 3,036,102 | | | | 3,036,102 | | | | — | | | 2006 | | N/A |
| 851 Gills Drive | | Orlando, FL | | | — | | | | 267,313 | | | | — | | | | 305,523 | | | | — | | | | 572,836 | | | | 572,836 | | | | — | | | 2006 | | N/A |
| 950 Gills Drive | | Orlando, FL | | | — | | | | 356,418 | | | | — | | | | 269,750 | | | | — | | | | 626,167 | | | | 626,167 | | | | — | | | 2006 | | N/A |
| 1000 Gills Drive | | Orlando, FL | | | — | | | | 333,873 | | | | — | | | | 269,171 | | | | — | | | | 603,044 | | | | 603,044 | | | | — | | | 2006 | | N/A |
| 17th & JFK Tower | | Philadelphia, PA | | | — | | | | 22,430,038 | | | | — | | | | 236,315,665 | | | | — | | | | 258,745,703 | | | | 258,745,703 | | | | — | | | 2005 | | N/A |
| 3900 Westerre Parkway | | Richmond, VA | | | — | | | | 392,184 | | | | — | | | | 10,177,825 | | | | — | | | | 10,570,009 | | | | 10,570,009 | | | | — | | | 2005 | | N/A |
| Renaissance Blvd & Hwy 20 | | Sturtevant, WI | | | — | | | | 2,484,450 | | | | — | | | | 8,512,026 | | | | — | | | | 10,996,476 | | | | 10,996,476 | | | | — | | | 2006 | | N/A |
| Bridgeway III Land | | Suffolk, VA | | | — | | | | 904,052 | | | | — | | | | 6,717,091 | | | | — | | | | 7,621,143 | | | | 7,621,143 | | | | — | | | 2006 | | N/A |
| 910-926 Chad Lane | | Tampa, FL | | | — | | | | 201,771 | | | | — | | | | 1,986,093 | | | | — | | | | 2,187,864 | | | | 2,187,864 | | | | — | | | 2006 | | N/A |
| 150-182 Kelsey Lane | | Tampa, FL | | | — | | | | 403,541 | | | | — | | | | 3,211,780 | | | | — | | | | 3,615,322 | | | | 3,615,322 | | | | — | | | 2006 | | N/A |
| 3701 Corporate Parkway | | Upper Saucon, PA | | | — | | | | 1,078,674 | | | | — | | | | 8,445,567 | | | | — | | | | 9,524,241 | | | | 9,524,241 | | | | — | | | 2005 | | N/A |
| 42 Kings Hill Avenue | | West Malling, UK | | | — | | | | — | | | | — | | | | 19,876,271 | | | | — | | | | 19,876,271 | | | | 19,876,271 | | | | — | | | 2005 | | N/A |
| 1 Kings Hill Aveune | | West Malling, UK | | | — | | | | — | | | | — | | | | 5,746,898 | | | | — | | | | 5,746,898 | | | | 5,746,898 | | | | — | | | 2006 | | N/A |
| 777 Township Line Road | | Yardley, PA | | | — | | | | 3,436,013 | | | | — | | | | 10,636,157 | | | | — | | | | 14,072,170 | | | | 14,072,170 | | | | — | | | 2005 | | N/A |
| | | | | | | | | |
| Subtotal Development in Progress | | | | $ | — | | | $ | 98,023,798 | | | $ | — | | | $ | 440,279,067 | | | $ | — | | | $ | 538,302,864 | | | $ | 538,302,864 | | | $ | — | | | | | |
| | | | | | | | | |
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End of Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (years) |
| LAND HELD FOR DEVELOPMENT | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Perryman Road Land | | Aberdeen, MD | | $ | — | | | $ | 12,046,811 | | | $ | — | | | $ | 91,099 | | | $ | 12,137,910 | | | $ | — | | | $ | 12,137,910 | | | $ | — | | | 2005 | | N/A |
| LVCC Phase 2 Land | | Bethlehem, PA | | | — | | | | 3,148,780 | | | | — | | | | 1,117,583 | | | | 4,266,363 | | | | — | | | | 4,266,363 | | | | — | | | 1998 | | N/A |
| Lehigh Valley Corporate Center Land | | Bethlehem, PA | | | — | | | | 265,842 | | | | — | | | | — | | | | 265,842 | | | | — | | | | 265,842 | | | | — | | | 1987 | | N/A |
| Boca Colannade Yamato Road | | Boca Raton, FL | | | — | | | | 3,649,792 | | | | — | | | | 1,103,719 | | | | 4,753,511 | | | | — | | | | 4,753,511 | | | | — | | | 1998 | | N/A |
| 95 Kriner Road | | Chambersburg, PA | | | — | | | | 8,662,788 | | | | — | | | | 7,761,134 | | | | 16,423,922 | | | | — | | | | 16,423,922 | | | | — | | | 2006 | | N/A |
| Battlefield Corp Ctr, Parcel 14 | | Chesapeake, VA | | | — | | | | 1,532,779 | | | | — | | | | 6,634 | | | | 1,539,413 | | | | — | | | | 1,539,413 | | | | — | | | 2006 | | N/A |
| Rivers’ Bend Land | | Chesterfield, VA | | | — | | | | 1,695,415 | | | | — | | | | 3,060,359 | | | | 4,755,773 | | | | — | | | | 4,755,773 | | | | — | | | 1995 | | N/A |
| 501 Hewlett Packard Way | | Chesterfield, VA | | | — | | | | 165,042 | | | | — | | | | 484,965 | | | | 650,007 | | | | — | | | | 650,007 | | | | — | | | 1996 | | N/A |
| Pleasant Ridge Road Land | | Greensboro, NC | | | — | | | | 828,289 | | | | — | | | | — | | | | 828,289 | | | | — | | | | 828,289 | | | | — | | | 2006 | | N/A |
| Southchase Business Park Land | | Greenville, SC | | | — | | | | 1,369,712 | | | | — | | | | 688,157 | | | | 2,057,869 | | | | — | | | | 2,057,869 | | | | — | | | 1998 | | N/A |
| Hunters Green Land | | Hagerstown, MD | | | — | | | | 8,942,141 | | | | — | | | | 246,486 | | | | 9,188,627 | | | | — | | | | 9,188,627 | | | | — | | | 2006 | | N/A |
| Lakefront Plaza II Land | | Hampton, VA | | | 157,601 | | | | 132,785 | | | | — | | | | 92,936 | | | | 225,721 | | | | — | | | | 225,721 | | | | — | | | 2001 | | N/A |
| Patapsco Valley Business Center | | Hanover, MD | | | — | | | | 2,402,322 | | | | — | | | | 1,118,795 | | | | 3,521,117 | | | | — | | | | 3,521,117 | | | | — | | | 2004 | | N/A |
| Mendenhall Land | | High Point, NC | | | — | | | | 1,910,135 | | | | — | | | | 5,028,104 | | | | 6,938,239 | | | | — | | | | 6,938,239 | | | | — | | | 1995 | | N/A |
| Piedmond Centre Land | | High Point, NC | | | — | | | | 866,380 | | | | — | | | | 526,614 | | | | 1,392,994 | | | | — | | | | 1,392,994 | | | | — | | | 2006 | | N/A |
| Horsham Business Center Land | | Horsham, PA | | | — | | | | 80,800 | | | | — | | | | 455 | | | | 81,255 | | | | — | | | | 81,255 | | | | — | | | 2005 | | N/A |
| Commonwealth Corporate Center Land | | Horsham, PA | | | — | | | | 3,047,683 | | | | — | | | | 19,263 | | | | 3,066,946 | | | | — | | | | 3,066,946 | | | | — | | | 2005 | | N/A |
| Central Green Land | | Houston, TX | | | — | | | | 481,229 | | | | — | | | | 10,440 | | | | 491,669 | | | | — | | | | 491,669 | | | | — | | | 2001 | | N/A |
| Fallbrrok Drive Land | | Houston, TX | | | — | | | | 1,990,270 | | | | — | | | | 15,915 | | | | 2,006,186 | | | | — | | | | 2,006,186 | | | | — | | | 2006 | | N/A |
| Windfern Drive Land | | Houston, TX | | | — | | | | 1,222,065 | | | | — | | | | 4,317 | | | | 1,226,382 | | | | — | | | | 1,226,382 | | | | — | | | 2006 | | N/A |
| Noxell Land | | Hunt Valley, MD | | | — | | | | 2,166,068 | | | | — | | | | 830,242 | | | | 2,996,310 | | | | — | | | | 2,996,310 | | | | — | | | 2001 | | N/A |
| Liberty Business Park Land | | Jacksonville, FL | | | — | | | | 448,097 | | | | — | | | | 90,019 | | | | 538,116 | | | | — | | | | 538,116 | | | | — | | | 1995 | | N/A |
| 7024 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 468,643 | | | | — | | | | 356,309 | | | | 824,952 | | | | — | | | | 824,952 | | | | — | | | 1995 | | N/A |
| Belfort Road | | Jacksonville, FL | | | — | | | | 468,643 | | | | — | | | | 109,850 | | | | 578,493 | | | | — | | | | 578,493 | | | | — | | | 1998 | | N/A |
| Butler Plaza Land | | Jacksonville, FL | | | — | | | | 1,303,792 | | | | — | | | | 1,706,463 | | | | 3,010,255 | | | | — | | | | 3,010,255 | | | | — | | | 1998 | | N/A |
| Salisbury Road Land | | Jacksonville, FL | | | — | | | | 880,828 | | | | — | | | | 699,651 | | | | 1,580,479 | | | | — | | | | 1,580,479 | | | | — | | | 2000 | | N/A |
| Skinner Land Parcel B | | Jacksonville, FL | | | — | | | | 2,306,191 | | | | — | | | | 1,102,674 | | | | 3,408,865 | | | | — | | | | 3,408,865 | | | | — | | | 2005 | | N/A |
| Kent County, UK | | Kent County, UK | | | — | | | | — | | | | — | | | | 7,698,943 | | | | 7,698,943 | | | | — | | | | 7,698,943 | | | | — | | | 2006 | | N/A |
| Boulders Business Center Land | | Lehigh, PA | | | — | | | | 15,243,107 | | | | — | | | | 2,660,386 | | | | 17,903,493 | | | | — | | | | 17,903,493 | | | | — | | | 2004 | | N/A |
| Mill Run Land | | Lehigh, PA | | | — | | | | 2,882,221 | | | | — | | | | 49,691 | | | | 2,931,911 | | | | — | | | | 2,931,911 | | | | — | | | 2005 | | N/A |
| Commodore Business Park | | Logan, NJ | | | — | | | | 1,458,019 | | | | — | | | | — | | | | 1,458,019 | | | | — | | | | 1,458,019 | | | | — | | | 1995 | | N/A |
| Quarry Ridge Land | | Malvern, PA | | | — | | | | 8,398,708 | | | | — | | | | 1,894,356 | | | | 10,293,063 | | | | — | | | | 10,293,063 | | | | — | | | 2001 | | N/A |
| Park Place South Land | | Milwaukee, WI | | | — | | | | 2,362,904 | | | | — | | | | 1,384,531 | | | | 3,747,435 | | | | — | | | | 3,747,435 | | | | — | | | 1999 | | N/A |
| Monarch Towne Center Land | | Mirarar, FL | | | — | | | | 12,327,714 | | | | — | | | | — | | | | 12,327,714 | | | | — | | | | 12,327,714 | | | | — | | | 2006 | | N/A |
| South 27th Street Land | | Oak Creek, WI | | | — | | | | 1,594,760 | | | | — | | | | 97,911 | | | | 1,692,671 | | | | — | | | | 1,692,671 | | | | — | | | 2006 | | N/A |
| Maitland Summit Park Land | | Orlando, FL | | | — | | | | 4,388,905 | | | | — | | | | 33,427 | | | | 4,422,332 | | | | — | | | | 4,422,332 | | | | — | | | 2005 | | N/A |
| Beachline Industrial Park Land | | Orlando, FL | | | — | | | | 1,103,606 | | | | — | | | | 215,454 | | | | 1,319,061 | | | | — | | | | 1,319,061 | | | | — | | | 2006 | | N/A |
| JFK & Arch Parking Lots/Land (West) | | Philadelphia, PA | | | — | | | | 4,700,222 | | | | — | | | | 2,941,184 | | | | 7,641,406 | | | | — | | | | 7,641,406 | | | | — | | | 2000 | | N/A |
| 4775 League Island Boulevard | | Philadelphia, PA | | | — | | | | 396,833 | | | | — | | | | 900,027 | | | | 1,296,860 | | | | — | | | | 1,296,860 | | | | — | | | 2006 | | N/A |
| Eastport VII | | Richmond, VA | | | — | | | | 787,091 | | | | — | | | | 844,001 | | | | 1,631,092 | | | | — | | | | 1,631,092 | | | | — | | | 1997 | | N/A |
| Eastport VIII | | Richmond, VA | | | — | | | | 379,836 | | | | — | | | | 6,187 | | | | 386,023 | | | | — | | | | 386,023 | | | | — | | | 1997 | | N/A |
| Eastport IX | | Richmond, VA | | | — | | | | 209,856 | | | | — | | | | 5,096 | | | | 214,952 | | | | — | | | | 214,952 | | | | — | | | 1997 | | N/A |
| Westerre Land | | Richmond, VA | | | — | | | | 738,090 | | | | — | | | | 902,239 | | | | 1,640,329 | | | | — | | | | 1,640,329 | | | | — | | | 2003 | | N/A |
| Romulus Land | | Romulus, MI | | | — | | | | 788,338 | | | | — | | | | 733,216 | | | | 1,521,554 | | | | — | | | | 1,521,554 | | | | — | | | 1998 | | N/A |
| Woodlands Center Land | | Sandston, VA | | | — | | | | 928,555 | | | | — | | | | 290,438 | | | | 1,218,993 | | | | — | | | | 1,218,993 | | | | — | | | 1996 | | N/A |
| Northsight Land (LPLP) | | Scottsdale, AZ | | | — | | | | 7,247,107 | | | | — | | | | 1,130,879 | | | | 8,377,985 | | | | — | | | | 8,377,985 | | | | — | | | 2005 | | N/A |
| Bridgeway II Land | | Suffolk, VA | | | — | | | | 678,039 | | | | — | | | | 1,703,485 | | | | 2,381,525 | | | | — | | | | 2,381,525 | | | | — | | | 2005 | | N/A |
| Suffolk Land | | Suffolk, VA | | | — | | | | 2,713,494 | | | | — | | | | 79,375 | | | | 2,792,869 | | | | — | | | | 2,792,869 | | | | — | | | 2006 | | N/A |
| 6119 W. Linebaugh Avenue | | Tampa, FL | | | — | | | | 175,886 | | | | — | | | | 22,320 | | | | 198,205 | | | | — | | | | 198,205 | | | | — | | | 2000 | | N/A |
| Tampa Triangle Land | | Tampa, FL | | | — | | | | 10,448,263 | | | | — | | | | 28,881 | | | | 10,477,143 | | | | — | | | | 10,477,143 | | | | — | | | 2006 | | N/A |
| 4631 Woodland Corporate Blvd Land | | Tampa, FL | | | — | | | | 1,752,917 | | | | — | | | | 152,856 | | | | 1,905,773 | | | | — | | | | 1,905,773 | | | | — | | | 2006 | | N/A |
| Big Beaver Airport Land | | Troy, MI | | | — | | | | 3,176,411 | | | | — | | | | (2,079,253 | ) | | | 1,097,158 | | | | — | | | | 1,097,158 | | | | — | | | 1999 | | N/A |
| | | | | | | | | |
| Subtotal Land Held for Development | | | | $ | 157,601 | | | $ | 147,364,204 | | | $ | — | | | $ | 47,967,813 | | | $ | 195,332,017 | | | $ | — | | | $ | 195,332,017 | | | $ | — | | | | | |
| | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | |
| Total All Properties | | | | $ | 92,559,074 | | | $ | 864,019,318 | | | $ | 1,812,183,416 | | | $ | 2,549,944,384 | | | $ | 873,406,988 | | | $ | 4,352,740,132 | | | $ | 5,226,147,119 | | | $ | 806,308,940 | | | | | |
| | | | | | | | | |
| | |
| * | | Denotes property is collateralized under mortgages with American General, USG Annuity and Life, Metropolitan Life and LaSalle Bank totaling $93.4 million. This amount is not included in the total above. |
SCHEDULE III
LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
(In thousands)
A summary of activity for real estate and accumulated depreciation is as follows:
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
REAL ESTATE: | | | | | | | | | | | | |
| Balance at beginning of year | | $ | 4,767,968 | | | $ | 4,417,084 | | | $ | 4,055,515 | |
| Additions | | | 826,213 | | | | 656,317 | | | | 409,720 | |
| Disposition of property | | | (368,034 | ) | | | (305,433 | ) | | | (48,151 | ) |
| | | | | | | | | | |
| Balance at end of year | | $ | 5,226,147 | | | $ | 4,767,968 | | | $ | 4,417,084 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
ACCUMULATED DEPRECIATION: | | | | | | | | | | | | |
| Balance at beginning of year | | $ | 732,439 | | | $ | 678,326 | | | $ | 572,327 | |
| Depreciation expense | | | 124,853 | | | | 123,278 | | | | 114,199 | |
| Disposition of property | | | (50,983 | ) | | | (69,165 | ) | | | (8,200 | ) |
| | | | | | | | | | |
| Balance at end of year | | $ | 806,309 | | | $ | 732,439 | | | $ | 678,326 | |
| | | | | | | | | | |
71
Management’s Annual Report on Internal Control Over Financial Reporting
To the Partners of Liberty Property Limited Partnership:
The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a — 15 (f) and 15d — 15(f). The Company’s internal control system was designed to provide reasonable assurance to the Company’s management regarding the preparation and fair presentation of published financial statements.
Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2006. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commissions (COSO) inInternal Control — Integrated Framework. Based on our assessment we believe that, as of December 31, 2006, the Company’s internal control over financial reporting is effective based on those criteria.
Management’s assertion regarding its assessment of internal control over financial reporting has been audited by Ernst & Young LLP, an independent registered public accounting firm, whose reports appear on the following pages.
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.
February 23, 2007
72
Report of Independent Registered Public Accounting Firm
The Partners of Liberty Property Limited Partnership:
We have audited management’s assessment, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting, that Liberty Property Limited Partnership (the “Operating Partnership”) maintained effective internal control over financial reporting as of December 31, 2006, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). The Operating Partnership’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express an opinion on management’s assessment and an opinion on the effectiveness of the Operating Partnership’s internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating management’s assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
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 (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) 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 (3) 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.
In our opinion, management’s assessment that Liberty Property Limited Partnership maintained effective internal control over financial reporting as of December 31, 2006, is fairly stated, in all material respects, based on the COSO criteria. Also, in our opinion, the Operating Partnership maintained, in all material respects, effective internal control over financial reporting as of December 31, 2006, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Liberty Property Limited Partnership as of December 31, 2006 and 2005, and the related consolidated statements of operations, owners’ equity, and cash flows for the each of the three years in the period ended December 31, 2006 of the Operating Partnership and our report dated February 23, 2007 expressed an unqualified opinion thereon.
/s/ Ernst & Young LLP
Philadelphia, Pennsylvania
February 23, 2007
73
Report of Independent Registered Public Accounting Firm
The Partners of Liberty Property Limited Partnership:
We have audited the accompanying consolidated balance sheets of Liberty Property Limited Partnership (the “Operating Partnership”) as of December 31, 2006 and 2005, and the related consolidated statements of operations, owners’ equity, and cash flows for each of the three years in the period ended December 31, 2006. Our audits also included the financial statement schedule listed in the Index at Item 15. These financial statements and schedule are the responsibility of the Operating Partnership’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Liberty Property Limited Partnership at December 31, 2006 and 2005, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2006, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of Liberty Property Limited Partnership’s internal control over financial reporting as of December 31, 2006, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 23, 2007 expressed an unqualified opinion thereon.
/s/Ernst & Young LLP
Philadelphia, Pennsylvania
February 23, 2007
74
CONSOLIDATED BALANCE SHEETS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(IN THOUSANDS)
| | | | | | | | | |
| | | December 31, | |
| | | 2006 | | | 2005 | |
ASSETS | | | | | | | | |
| Real estate: | | | | | | | | |
| Land and land improvements | | $ | 678,075 | | | $ | 620,355 | |
| Buildings and improvements | | | 3,814,437 | | | | 3,664,036 | |
| Less accumulated depreciation | | | (806,309 | ) | | | (732,439 | ) |
| | | | | | | |
| Operating real estate | | | 3,686,203 | | | | 3,551,952 | |
| | | | | | | | | |
| Development in progress | | | 538,303 | | | | 324,924 | |
| Land held for development | | | 195,332 | | | | 158,653 | |
| | | | | | | |
| Net real estate | | | 4,419,838 | | | | 4,035,529 | |
| | | | | | | | | |
| Cash and cash equivalents | | | 53,737 | | | | 61,629 | |
| Restricted cash | | | 55,671 | | | | 29,085 | |
| Accounts receivable | | | 23,809 | | | | 14,761 | |
| Deferred rent receivable | | | 71,894 | | | | 72,818 | |
| Deferred financing and leasing costs, net | | | 129,745 | | | | 122,994 | |
| Investments in unconsolidated joint ventures | | | 47,196 | | | | 33,522 | |
| Assets held for sale | | | 40,715 | | | | 73,211 | |
| Prepaid expenses and other assets | | | 68,306 | | | | 56,773 | |
| | | | | | | | | |
| | | | | | | |
| Total assets | | $ | 4,910,911 | | | $ | 4,500,322 | |
| | | | | | | |
| | | | | | | | | |
LIABILITIES | | | | | | | | |
| Mortgage loans | | $ | 185,978 | | | $ | 238,728 | |
| Unsecured notes | | | 1,955,000 | | | | 1,755,000 | |
| Credit facility | | | 246,960 | | | | 255,450 | |
| Accounts payable | | | 40,633 | | | | 32,919 | |
| Accrued interest | | | 36,297 | | | | 34,892 | |
| Distributions payable | | | 58,961 | | | | 56,490 | |
| Other liabilities | | | 217,751 | | | | 164,528 | |
| | | | | | | | | |
| | | | | | | |
| Total liabilities | | | 2,741,580 | | | | 2,538,007 | |
| | | | | | | | | |
| Minority interest | | | 419 | | | | 407 | |
| | | | | | | | | |
OWNERS’ EQUITY | | | | | | | | |
| General partner’s equity — common units | | | 1,871,604 | | | | 1,709,182 | |
| Limited partners’ equity — preferred units | | | 210,960 | | | | 184,657 | |
| — common units | | | 86,348 | | | | 68,069 | |
| | | | | | | | | |
| | | | | | | |
| Total owners’ equity | | | 2,168,912 | | | | 1,961,908 | |
| | | | | | | |
| | | | | | | | | |
| Total liabilities and owners’ equity | | $ | 4,910,911 | | | $ | 4,500,322 | |
| | | | | | | |
See accompanying notes.
75
CONSOLIDATED STATEMENTS OF OPERATIONS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(IN THOUSANDS, EXCEPT PER UNIT AMOUNTS)
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
OPERATING REVENUE | | | | | | | | | | | | |
| Rental | | $ | 464,714 | | | $ | 451,608 | | | $ | 421,712 | |
| Operating expense reimbursement | | | 202,005 | | | | 181,886 | | | | 163,572 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Total operating revenue | | | 666,719 | | | | 633,494 | | | | 585,284 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
OPERATING EXPENSES | | | | | | | | | | | | |
| Rental property | | | 139,055 | | | | 130,353 | | | | 115,143 | |
| Real estate taxes | | | 71,652 | | | | 64,879 | | | | 58,901 | |
| General and administrative | | | 45,991 | | | | 38,099 | | | | 33,724 | |
| Depreciation and amortization | | | 144,692 | | | | 135,846 | | | | 119,934 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Total operating expenses | | | 401,390 | | | | 369,177 | | | | 327,702 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
Operating income | | | 265,329 | | | | 264,317 | | | | 257,582 | |
| | | | | | | | | | | | | |
OTHER INCOME (EXPENSE) | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Interest and other income | | | 9,591 | | | | 8,008 | | | | 6,266 | |
| Interest expense | | | (119,584 | ) | | | (119,614 | ) | | | (107,027 | ) |
| | | | | | | | | | | | | |
| | | | | | | | | | |
| Total other income(expense) | | | (109,993 | ) | | | (111,606 | ) | | | (100,761 | ) |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Income before property dispositions, income taxes, minority interest and equity in earnings (loss) of unconsolidated joint ventures | | | 155,336 | | | | 152,711 | | | | 156,821 | |
| |
| Gain on property dispositions | | | 17,628 | | | | 85,593 | | | | 496 | |
| Income taxes | | | (288 | ) | | | (14,827 | ) | | | (1,820 | ) |
| Minority interest | | | 7 | | | | (357 | ) | | | 632 | |
| Equity in earnings (loss) of unconsolidated joint ventures | | | 1,432 | | | | 2,540 | | | | (775 | ) |
| | | | | | | | | | |
Income from continuing operations | | | 174,115 | | | | 225,660 | | | | 155,354 | |
| | | | | | | | | | | | | |
| Discontinued operations (including net gain on property dispositions of $112,620, $36,617 and $11,603 for the years ended December 31, 2006, 2005 and 2004, respectively) | | | 117,935 | | | | 46,299 | | | | 24,888 | |
| | | | | | | | | | |
Net income | | | 292,050 | | | | 271,959 | | | | 180,242 | |
| Preferred unit distributions | | | 13,691 | | | | 12,095 | | | | 11,844 | |
| Excess of preferred unit redemption over carrying amount | | | — | | | | 500 | | | | — | |
| | | | | | | | | | |
| Income available to common unitholders | | $ | 278,359 | | | $ | 259,364 | | | $ | 168,398 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
Earnings per common unit | | | | | | | | | | | | |
| Basic: | | | | | | | | | | | | |
| Income from continuing operations | | $ | 1.72 | | | $ | 2.36 | | | $ | 1.63 | |
| Income from discontinued operations | | | 1.26 | | | | 0.51 | | | | 0.28 | |
| | | | | | | | | | |
| Income per common unit — basic | | $ | 2.98 | | | $ | 2.87 | | | $ | 1.91 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Diluted: | | | | | | | | | | | | |
| Income from continuing operations | | $ | 1.70 | | | $ | 2.32 | | | $ | 1.60 | |
| Income from discontinued operations | | | 1.25 | | | | 0.50 | | | | 0.28 | |
| | | | | | | | | | |
| Income per common unit — diluted | | $ | 2.95 | | | $ | 2.82 | | | $ | 1.88 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Weighted average number of common units outstanding | | | | | | | | | | | | |
| Basic | | | 93,208 | | | | 90,540 | | | | 88,210 | |
| Diluted | | | 94,387 | | | | 91,931 | | | | 89,700 | |
See accompanying notes.
76
CONSOLIDATED STATEMENTS OF OWNERS’ EQUITY OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(IN THOUSANDS)
| | | | | | | | | | | | | |
| | | General | | | Limited | | | Total | |
| | | Partner’s | | | Partners’ | | | Owners’ | |
| | | Equity | | | Equity | | | Equity | |
| Balance at January 1, 2004 | | $ | 1,544,897 | | | $ | 204,212 | | | $ | 1,749,109 | |
| Contributions from partners | | | 85,967 | | | | 1,593 | | | | 87,560 | |
| Distributions to partners | | | (206,443 | ) | | | (20,718 | ) | | | (227,161 | ) |
| Issuance of operating partnership units | | | — | | | | — | | | | — | |
| Foreign currency translation adjustment | | | 10,395 | | | | — | | | | 10,395 | |
| Net income | | | 161,443 | | | | 18,799 | | | | 180,242 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Balance at December 31, 2004 | | | 1,596,259 | | | | 203,886 | | | | 1,800,145 | |
| Contributions from partners | | | 93,157 | | | | (1,664 | ) | | | 91,493 | |
| Distributions to partners | | | (214,386 | ) | | | (21,290 | ) | | | (235,676 | ) |
| Issuance of operating partnership units | | | — | | | | 49,186 | | | | 49,186 | |
| Foreign currency translation adjustment | | | (15,199 | ) | | | — | | | | (15,199 | ) |
| Net income | | | 249,351 | | | | 22,608 | | | | 271,959 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Balance at December 31, 2005 | | | 1,709,182 | | | | 252,726 | | | | 1,961,908 | |
| Contributions from partners | | | 107,338 | | | | (14,067 | ) | | | 93,271 | |
| Distributions to partners | | | (221,907 | ) | | | (23,129 | ) | | | (245,036 | ) |
| Issuance of operating partnership units | | | — | | | | 56,302 | | | | 56,302 | |
| Foreign currency translation adjustment | | | 10,417 | | | | — | | | | 10,417 | |
| Net income | | | 266,574 | | | | 25,476 | | | | 292,050 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Balance at December 31, 2006 | | $ | 1,871,604 | | | $ | 297,308 | | | $ | 2,168,912 | |
| | | | | | | | | | |
See accompanying notes.
77
CONSOLIDATED STATEMENTS OF CASH FLOWS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(IN THOUSANDS)
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
OPERATING ACTIVITIES | | | | | | | | | | | | |
| Net income | | $ | 292,050 | | | $ | 271,959 | | | $ | 180,242 | |
| Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | | | | | |
| Depreciation and amortization | | | 151,966 | | | | 150,722 | | | | 136,700 | |
| Amortization of deferred financing costs | | | 4,244 | | | | 4,758 | | | | 4,315 | |
| Equity in (earnings) loss of unconsolidated joint ventures | | | (1,432 | ) | | | (2,540 | ) | | | 775 | |
| Distributions from unconsolidated joint ventures | | | 5,692 | | | | 4,651 | | | | 682 | |
| Minority interest in net income | | | (7 | ) | | | 357 | | | | (632 | ) |
| Gain on property dispositions | | | (130,248 | ) | | | (122,210 | ) | | | (12,099 | ) |
| Noncash compensation | | | 6,212 | | | | 5,032 | | | | 2,388 | |
| Changes in operating assets and liabilities: | | | | | | | | | | | | |
| Restricted cash | | | (21,692 | ) | | | 3,849 | | | | (19,334 | ) |
| Accounts receivable | | | (6,879 | ) | | | 1,804 | | | | (8,449 | ) |
| Deferred rent receivable | | | 924 | | | | (6,290 | ) | | | (8,513 | ) |
| Prepaid expenses and other assets | | | (14,394 | ) | | | (12,488 | ) | | | (12,046 | ) |
| Accounts payable | | | 7,648 | | | | 8,894 | | | | 8,859 | |
| Accrued interest | | | 1,405 | | | | (102 | ) | | | 2,166 | |
| Other liabilities | | | 49,412 | | | | 52,353 | | | | 18,282 | |
| | | | | | | | | | |
| Net cash provided by operating activities | | | 344,901 | | | | 360,749 | | | | 293,336 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
INVESTING ACTIVITIES | | | | | | | | | | | | |
| Investment in properties | | | (372,610 | ) | | | (324,340 | ) | | | (253,017 | ) |
| Investments in unconsolidated joint ventures | | | (6,239 | ) | | | (13,790 | ) | | | (6,198 | ) |
| Net proceeds from disposition of properties/land | | | 492,548 | | | | 415,144 | | | | 54,140 | |
| Investment in development in progress | | | (359,959 | ) | | | (235,078 | ) | | | (105,208 | ) |
| Increase in land held for development | | | (79,976 | ) | | | (91,436 | ) | | | (34,132 | ) |
| Increase in deferred leasing costs | | | (29,034 | ) | | | (37,133 | ) | | | (29,560 | ) |
| | | | | | | | | | |
| Net cash used in investing activities | | | (355,270 | ) | | | (286,633 | ) | | | (373,975 | ) |
| | | | | | | | | | |
| | | | | | | | | | | | | |
FINANCING ACTIVITIES | | | | | | | | | | | | |
| Net proceeds from issuance of unsecured notes | | | 295,393 | | | | 296,424 | | | | 197,517 | |
| Repayment of unsecured notes | | | (100,000 | ) | | | — | | | | (100,000 | ) |
| Proceeds from mortgage loans | | | — | | | | — | | | | 9,618 | |
| Repayments of mortgage loans | | | (56,406 | ) | | | (173,926 | ) | | | (23,592 | ) |
| Proceeds from credit facility | | | 725,025 | | | | 784,800 | | | | 477,800 | |
| Repayments on credit facility | | | (733,515 | ) | | | (841,350 | ) | | | (332,800 | ) |
| Increase in deferred financing costs | | | (1,635 | ) | | | (3,465 | ) | | | (199 | ) |
| Capital contributions | | | 113,348 | | | | 135,148 | | | | 86,329 | |
| Distributions to partners | | | (242,537 | ) | | | (237,101 | ) | | | (225,055 | ) |
| | | | | | | | | | |
| Net cash (used in) provided by financing activities | | | (327 | ) | | | (39,470 | ) | | | 89,618 | |
| | | | | | | | | | |
| (Decrease) increase in cash and cash equivalents | | | (10,696 | ) | | | 34,646 | | | | 8,979 | |
| Increase (decrease) in cash and cash equivalents related to foreign currency translation | | | 2,804 | | | | (6,684 | ) | | | 2,879 | |
| Cash and cash equivalents at beginning of year | | | 61,629 | | | | 33,667 | | | | 21,809 | |
| | | | | | | | | | |
| Cash and cash equivalents at end of year | | $ | 53,737 | | | $ | 61,629 | | | $ | 33,667 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS | | | | | | | | | | | | |
| Write-off of fully depreciated property and deferred costs | | $ | 87,424 | | | $ | 83,794 | | | $ | 27,990 | |
| Issuance of operating partnership common units | | | 30,000 | | | | — | | | | — | |
| Acquisition of properties | | | (3,066 | ) | | | (51,716 | ) | | | (11,305 | ) |
| Assumption of mortgage loans | | | 3,066 | | | | 51,716 | | | | 11,305 | |
See accompanying notes.
78
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
1. ORGANIZATION
Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (a “REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the “Operating Partnership” and, together with the Trust and their consolidated subsidiaries, the “Company”). The Trust is the sole general partner and also a limited partner of the Operating Partnership, owning 95.6% of the common equity of the Operating Partnership at December 31, 2006. The Company provides leasing, property management, development, acquisition, and other tenant-related services for a portfolio of industrial and office properties which are located principally within the Mid-Atlantic, Southeastern and Midwestern United States and the United Kingdom.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“US GAAP”) requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.
Principles of Consolidation
The consolidated financial statements of the Company include the Operating Partnership and wholly owned subsidiaries and those subsidiaries in which the Company owns a majority voting interest with the ability to control operations of the subsidiaries and where no approval, veto or other important rights have been granted to the minority shareholders. All significant intercompany transactions and accounts have been eliminated.
Reclassifications
Certain amounts from prior years have been reclassified to conform to current-year presentation.
Real Estate and Depreciation
The properties are recorded at cost and are depreciated using the straight line method over their estimated useful lives. The estimated lives are as follows:
| | | |
| Building and Improvements | | 40 years (blended) |
| Equipment | | 5 — 10 years |
| Tenant improvements | | Term of the related lease |
Expenditures directly related to acquisition or improvement of real estate, including interest and other costs capitalized during development, are included in net real estate and are stated at cost. The capitalized costs include pre-construction costs essential to the development of the property, development and construction costs, interest costs, real estate taxes, development-related salaries and other costs incurred during the period of development. Expenditures for maintenance and repairs are charged to operations as incurred.
In accordance with the Financial Accounting Standards Board (“FASB”) Statement of Financial Standards (“SFAS”) No. 141, “Business Combinations,” the Company allocates the purchase price of real estate to land, building and improvements and intangibles based on the relative fair value of each component. The value ascribed to in-place leases is based on the rental rates for the existing leases compared to market rent for leases of similar terms and present valuing the difference based on market interest rates. Origination values are also assigned to in-place leases, and, where appropriate, value is assigned to customer relationships. The Company depreciates the amounts allocated to building and improvements over 40 years and the amounts allocated to intangible assets relating to in-place leases, which are included in deferred financing and leasing costs and other liabilities in the accompanying consolidated balance sheets, over the remaining term of the related leases.
Once a property is designated as held for sale, no further depreciation expense is recorded. Operations for properties identified as held for sale and/or sold where no continuing involvement exists are presented in discontinued operations for all periods presented.
The Company evaluates its real estate investments and its investments in unconsolidated joint ventures upon occurrence of a significant adverse change in its operations to assess whether any impairment indicators are present that affect the recovery of the recorded value. If any real estate investment or investment in unconsolidated joint
79
ventures is considered impaired, a loss is recognized to reduce the carrying value of the property to its estimated fair value.
Investments in Unconsolidated Joint Ventures
The Company accounts for its investments in unconsolidated joint ventures using the equity method of accounting as the Company exercises significant influence, but does not control these entities. Under the equity method of accounting, the net equity investment of the Company is reflected in the accompanying consolidated balance sheets and the Company’s share of net income from the joint ventures is included in the accompanying consolidated statements of operations.
Cash and Cash Equivalents
Highly liquid investments with a maturity of three months or less when purchased are classified as cash equivalents.
Restricted Cash
Restricted cash includes tenant security deposits and escrow funds that the Company maintains pursuant to certain mortgage loans. Restricted cash also includes the undistributed proceeds from the sale of residential land in Kent County, United Kingdom.
Accounts Receivable
The Company’s accounts receivable are comprised of rents and charges for property operating costs due from tenants. The Company periodically performs a detailed review of amounts due from tenants to determine if accounts receivable balances are collectible. Based on this review, accounts receivable are reduced by an allowance for doubtful accounts. The Company considers tenant credit quality and payment history and general economic conditions in determining the allowance for doubtful accounts. If the accounts receivable balance is subsequently deemed uncollectible, the receivable and allowance for doubtful account balance is written off.
The allowance for doubtful accounts at December 31, 2006 and 2005 was $5.1 million and $6.7 million, respectively.
Deferred Rent Receivable
The Company’s deferred rent receivable represents the cumulative difference between rent revenue recognized on a straight line basis and contractual payments due under the terms of tenant leases.
Revenues
The Company earns rental income under operating leases with tenants. Rental income is recognized on a straight line basis over the applicable lease term. Operating expense reimbursements consisting of amounts due from tenants for real estate taxes, utilities and other recoverable costs are recognized as revenue in the period in which the corresponding expenses are incurred.
Termination fees (included in rental revenue) are fees that the Company has agreed to accept in consideration for permitting certain tenants to terminate their lease prior to the contractual expiration date. The Company recognizes termination fees in accordance with Staff Accounting Bulletin 104 when the following conditions are met:
| | a) | | the termination agreement is executed, |
| |
| | b) | | the termination fee is determinable, |
| |
| | c) | | all landlord services, pursuant to the terminated lease, have been rendered, and |
| |
| | d) | | collectibility of the termination fee is assured. |
Deferred Financing and Leasing Costs
Costs incurred in connection with financing or leasing are capitalized and amortized over the term of the related loan or lease. Deferred financing cost amortization is reported as interest expense. Intangible assets related to acquired in-place leases are amortized over the terms of the related leases.
Costs Incurred for Preferred Unit Issuance
Costs incurred in connection with the Company’s preferred unit issuances are reflected as a reduction of Limited partner’s equity — preferred units.
80
Income per Common Unit
The following table sets forth the computation of basic and diluted income per common unit (in thousands, except per unit amounts):
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2006 | | | 2005 | |
| | | | | | | Weighted | | | | | | | | | | | Weighted | | | | |
| | | | | | | Average | | | | | | | | | | | Average | | | | |
| | | Income | | | Units | | | Per | | | Income | | | Units | | | Per | |
| | | (Numerator) | | | (Denominator) | | | Unit | | | (Numerator) | | | (Denominator) | | | Unit | |
| Income from continuing operations | | $ | 174,115 | | | | | | | | | | | $ | 225,660 | | | | | | | | | |
| Less: Preferred unit distributions | | | (13,691 | ) | | | | | | | | | | | (12,095 | ) | | | | | | | | |
| Excess of preferred unit redemption over carrying amount | | | — | | | | | | | | | | | | (500 | ) | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Basic income from continuing operations | | | | | | | | | | | | | | | | | | | | | | | | |
| Income from continuing operations available to common unitholders | | | 160,424 | | | | 93,208 | | | $ | 1.72 | | | | 213,065 | | | | 90,540 | | | $ | 2.36 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Dilutive units for long-term compensation plans | | | — | | | | 1,179 | | | | | | | | — | | | | 1,391 | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Diluted income from continuing operations | | | | | | | | | | | | | | | | | | | | | | | | |
| Income from continuing operations available to common unitholders and assumed conversions | | | 160,424 | | | | 94,387 | | | $ | 1.70 | | | | 213,065 | | | | 91,931 | | | $ | 2.32 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Basic income from discontinued operations | | | | | | | | | | | | | | | | | | | | | | | | |
| Discontinued operations | | | 117,935 | | | | 93,208 | | | $ | 1.26 | | | | 46,299 | | | | 90,540 | | | $ | 0.51 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Dilutive units for long-term compensation plans | | | — | | | | 1,179 | | | | | | | | — | | | | 1,391 | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Diluted income from discontinued operations | | | | | | | | | | | | | | | | | | | | | | | | |
| Discontinued operations | | | 117,935 | | | | 94,387 | | | $ | 1.25 | | | | 46,299 | | | | 91,931 | | | $ | 0.50 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Basic income per common unit | | | | | | | | | | | | | | | | | | | | | | | | |
| Income available to common unitholders | | | 278,359 | | | | 93,208 | | | $ | 2.98 | | | | 259,364 | | | | 90,540 | | | $ | 2.87 | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Dilutive shares for long-term compensation plans | | | — | | | | 1,179 | | | | | | | | — | | | | 1,391 | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Diluted income per common unit | | | | | | | | | | | | | | | | | | | | | | | | |
| Income available to common unitholders and assumed conversions | | $ | 278,359 | | | | 94,387 | | | $ | 2.95 | | | $ | 259,364 | | | | 91,931 | | | $ | 2.82 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
| | | 2004 |
| | | | | | | Weighted | | | | |
| | | | | | | Average | | | | |
| | | Income | | | Units | | | Per |
| | | (Numerator) | | | (Denominator) | | | Unit |
| Income from continuing operations | | $ | 155,354 | | | | | | | | |
| Less: Preferred unit distributions | | | (11,844 | ) | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | | |
Basic income from continuing operations | | | | | | | | | | | |
| Income from continuing operations available to common unitholders | | | 143,510 | | | | 88,210 | | | $ | 1.63 |
| | | | | | | | | | | |
| Dilutive units for long-term compensation plans | | | — | | | | 1,490 | | | | |
| | | | | | | | | | |
| | | | | | | | | | | | |
Diluted income from continuing operations | | | | | | | | | | | |
| Income from continuing operations available to common unitholders and assumed conversions | | | 143,510 | | | | 89,700 | | | $ | 1.60 |
| | | | | | | | | |
| | | | | | | | | | | | |
Basic income from discontinued operations | | | | | | | | | | | |
| Discontinued operations | | | 24,888 | | | | 88,210 | | | $ | 0.28 |
| | | | | | | | | | | |
| Dilutive units for long-term compensation plans | | | — | | | | 1,490 | | | | |
| | | | | | | | | | |
| | | | | | | | | | | | |
Diluted income from discontinued operations | | | | | | | | | | | |
| Discontinued operations | | | 24,888 | | | | 89,700 | | | $ | 0.28 |
| | | | | | | | | |
| | | | | | | | | | | | |
Basic income per common unit | | | | | | | | | | | |
| Income available to common unitholders | | | 168,398 | | | | 88,210 | | | $ | 1.91 |
| | | | | | | | | | | |
| Dilutive unit for long-term compensation plans | | | — | | | | 1,490 | | | | |
| | | | | | | | | | |
| | | | | | | | | | | | |
Diluted income per common unit | | | | | | | | | | | |
| Income available to common unitholders and assumed conversions | | $ | 168,398 | | | | 89,700 | | | $ | 1.88 |
| | | | | | | | | |
Fair Value of Financial Instruments
The carrying value of cash and cash equivalents, restricted cash, accounts receivable, deferred rent receivable, accounts payable, accrued interest, distributions payable and other liabilities are reasonable estimates of fair values because of the short-term nature of these instruments. The fair value of the Company’s long-term debt, which is based on estimates by management and on rates quoted on December 31, 2006 for comparable loans, exceeds the aggregate carrying value by approximately $91 million at December 31, 2006.
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Income Taxes
In conformity with the Internal Revenue Code and applicable state and local tax statutes, taxable income or loss of the Operating Partnership is required to be reported in the tax returns of the partners in accordance with the terms of the Partnership Agreement. However, the Company is taxed in certain states and the United Kingdom. Accordingly, the Company has recognized federal, state and local taxes in accordance with US GAAP, as applicable.
Certain of the Company’s taxable REIT subsidiaries have net operating loss carryforwards of approximately $9.7 million available as of December 31, 2006. These carryforwards begin to expire in 2013. We have considered estimated future taxable income and have determined that a valuation allowance for the full carrying value of net operating loss carryforwards is appropriate.
Foreign Currency Translation
The functional currency of the Company’s United Kingdom operations is pounds sterling. The Company translates the financial statements for the United Kingdom operations into US dollars. Gains and losses resulting from this translation do not impact the results of operations and are included in accumulated other comprehensive income as a separate component of shareholders’ equity. Accumulated other comprehensive income consists solely of translation adjustments as described. Other comprehensive income (loss) was $10.4 million, ($15.2 million) and $10.4 million for the years ended December 31, 2006, 2005 and 2004, respectively. Upon sale or upon complete or substantially complete liquidation of a foreign investment, the gain or loss on the sale will include the cumulative translation adjustments that have been previously recorded in other comprehensive income.
Recently Issued Accounting Standards
SFAS No. 153
In December 2004, the FASB issued SFAS No. 153, “Accounting for Non-monetary Transactions” (“SFAS No. 153”). SFAS No. 153 requires non-monetary exchanges to be accounted for at fair value, recognizing any gain or loss, if the transactions meet a commercial-substance criterion and fair value is determinable. The provisions of SFAS No. 153 are effective for non-monetary asset exchanges occurring in fiscal years beginning after June 15, 2005. The Company adopted the provisions of SFAS No. 153 on January 1, 2006 and the adoption did not have a material impact on the Company’s results of operations or its financial position.
EITF Issue 04-5
In June 2005, the FASB ratified its consensus in EITF Issue 04-5, “Determining Whether a General Partner, or the General Partners as a Group, Controls a Limited Partnership or Similar Entity When the Limited Partners Have Certain Rights” (“Issue 04-5”). The effective date for Issue 04-5 was June 29, 2005 for all new or modified partnerships and January 1, 2006 for all other partnerships. The adoption of Issue 04-5 did not have a material impact on the Company’s results of operations or its financial position.
SFAS No. 157
In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS No. 157”), which defines fair value, establishes a framework for consistently measuring fair value under GAAP, and expands disclosures about fair value measurements. SFAS No. 157 is effective for the Company beginning January 1, 2008, and the provisions of SFAS No. 157 will be applied prospectively as of that date. The Company does not anticipate that the adoption of this statement will have a material effect on its financial position or results of operations.
FIN 48
In July 2006, the FASB issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 is an interpretation of SFAS No. 109, “Accounting for Income Taxes,” and it seeks to reduce the diversity in practice associated with certain aspects of measurement and recognition in accounting for income taxes. In addition, FIN 48 provides guidance on derecognition, classification, interest and penalties, and accounting in interim periods and requires expanded disclosure with respect to the uncertainty in income taxes. FIN 48 is effective for the Company beginning January 1, 2007. The cumulative effect, if any, of applying FIN 48 is to be reported as an adjustment to the opening balance of retained earnings in the year of adoption. The Company is currently evaluating the financial impact, if any, of the interpretation and will adopt the provisions of FIN 48 on January 1, 2007.
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3. REAL ESTATE
The Company owns and operates industrial and office properties located principally in suburban mixed-use developments or business parks. The carrying value of these properties by type as of December 31, 2006 and 2005 is as follows (in thousands):
| | | | | | | | | | | | | | | | | |
| | | Land | | | Buildings | | | | | | | | |
| | | And Land | | | And | | | | | | | Accumulated | |
| | | Improvements | | | Improvements | | | Total | | | Depreciation | |
| 2006 | | | | | | | | | | | | | | | | |
| Industrial properties | | $ | 309,119 | | | $ | 1,652,100 | | | $ | 1,961,219 | | | $ | 372,444 | |
| Office properties | | | 368,956 | | | | 2,162,337 | | | | 2,531,293 | | | | 433,865 | |
| | | | | | | | | | | | | |
| 2006 Total | | $ | 678,075 | | | $ | 3,814,437 | | | $ | 4,492,512 | | | $ | 806,309 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| 2005 | | | | | | | | | | | | | | | | |
| Industrial properties | | $ | 305,207 | | | $ | 1,657,992 | | | $ | 1,963,199 | | | $ | 336,721 | |
| Office properties | | | 315,148 | | | | 2,006,044 | | | | 2,321,192 | | | | 395,718 | |
| | | | | | | | | | | | | |
| 2005 Total | | $ | 620,355 | | | $ | 3,664,036 | | | $ | 4,284,391 | | | $ | 732,439 | |
| | | | | | | | | | | | | |
Depreciation expense was $124.9 million in 2006, $123.3 million in 2005 and $114.2 million in 2004.
As of December 31, 2006, the Company commenced development on 38 properties, which upon completion are expected to comprise 7.4 million square feet of leaseable space. As of December 31, 2006, $538.3 million had been expended for the development of these projects and an additional $475.0 million is estimated to be required for completion.
Information on the operating properties the Company sold during the years ended December 31, 2006 and 2005 is as follows:
| | | | | | | | | | | | | |
| 2006Sales | | | | | | | | | |
| | | Number of | | | Leaseable | | | | |
| Segment | | Buildings | | | Square Feet | | | Proceeds | |
| | | | | | | | | | | (in thousands) | |
| Delaware Valley | | | | | | | | | | | | |
| Southeastern Pennsylvania | | | 3 | | | | 1,146,940 | | | $ | 101,700 | |
| Other | | | 3 | | | | 155,056 | | | | 10,760 | |
| Midwest | | | | | | | | | | | | |
| Lehigh Valley | | | 5 | | | | 716,758 | | | | 109,255 | |
| Other | | | 16 | | | | 2,519,409 | | | | 134,375 | |
| Mid-Atlantic | | | 16 | | | | 1,449,464 | | | | 139,300 | |
| Florida | | | 3 | | | | 147,262 | | | | 7,474 | |
| | | | | | | | | | |
| Total | | | 46 | | | | 6,134,889 | | | $ | 502,864 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| 2005Sales | | | | | | | | | |
| | | Number of | | | Leaseable | | | | |
| Segment | | Buildings | | | Square Feet | | | Proceeds | |
| | | | | | | | | | | (in thousands) | |
| Delaware Valley | | | | | | | | | | | | |
| Southeastern Pennsylvania | | | 2 | | | | 139,760 | | | $ | 7,864 | |
| Other | | | 3 | | | | 177,733 | | | | 12,333 | |
| Midwest | | | | | | | | | | | | |
| Lehigh Valley | | | 2 | | | | 142,204 | | | | 8,676 | |
| Other | | | 18 | | | | 400,262 | | | | 23,236 | |
| Mid-Atlantic | | | 4 | | | | 727,732 | | | | 51,570 | |
| Florida | | | 6 | | | | 726,632 | | | | 53,834 | |
| United Kingdom | | | 16 | | | | 602,175 | | | | 263,343 | |
| | | | | | | | | | |
| Total | | | 51 | | | | 2,916,498 | | | $ | 420,856 | |
| | | | | | | | | | |
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4. INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES
Liberty Venture I, LP
The Company has a 25% interest in Liberty Venture I, LP, an entity engaged in ownership of industrial distribution properties in New Jersey (the Delaware Valley — Other segment). The Company also provides development, leasing and property management services for a fee, and may receive a promoted interest if certain return thresholds are met.
The Company recognized $634,000, $934,000, and $742,000 for development, leasing and property management services during the years ended December 31, 2006, 2005 and 2004, respectively.
Kings Hill Unit Trust
On December 14, 2005, the Company entered into a joint venture agreement (“Kings Hill Unit Trust”) with Doughty Hanson & Co. Real Estate. The Company sold 15 properties with a net book value of $125.8 million to the joint venture for proceeds of $219.9 million. In addition, the Company holds a $7.5 million note receivable from the Kings Hill Unit Trust and retained a 20% ownership interest in the joint venture. The note receivable bears interest at a 9% rate. The Company recognized a $75.1 million gain net of $14.5 million of tax on the sale of the properties to the Kings Hill Unit Trust. Due to the Company’s continuing involvement in this joint venture, the operations to the date of sale, as well as the gain on sale and related taxes are included in income from continuing operations in the accompanying consolidated statements of operations. The properties which were sold are industrial-flex and office properties and were included in the Company’s United Kingdom segment. The Company provides property management services for a fee, and may receive a promoted interest if certain return thresholds are met.
Income from property management fees and interest was $1.3 million during the year ended December 31, 2006.
Liberty/Commerz 1701 JFK Boulevard, LP
On April 13, 2006, the Company entered into a joint venture (“Liberty/Commerz 1701 JFK Boulevard, LP”) with an affiliate of Commerzleasing und Immobilien AG, a wholly owned subsidiary of Commerzbank AG, pursuant to which it sold an 80% interest in the equity of Comcast Center, a 1.25 million square foot office tower the Company is developing in Philadelphia, Pennsylvania. The transaction valued the property at $512 million. In connection with the transaction, the joint venture obtained a $324 million forward loan commitment at a rate of 6.15% assuming the loan closes in March 2008. In addition to retaining a 20% interest, the Company will earn leasing and property management fees and may receive a promoted interest if certain return thresholds are met.
Under the terms of the joint venture arrangement, the Company is obligated to complete development of the building, the estimated cost of which is approximately $495 million, and is also obligated to complete the initial lease up of the property. Based on the updated leasing schedule Liberty may have to fund $3.5 million in rent support. The criteria for sale recognition in accordance with SFAS No. 66, “Accounting for the Sale of Real Estate,” have not been met and this transaction is accounted for as a financing arrangement.
Liberty Illinois, LP
On April 25, 2006, the Company entered into a joint venture (“Liberty Illinois, LP”) with the New York State Common Retirement Fund, selling a 75% equity interest in six distribution buildings totaling 2.1 million square feet and 104 acres of developable land. The joint venture valued the buildings and land at $125.0 million. The Company retained a 25% ownership interest in the joint venture, and will earn development, leasing and property management fees, and may receive a promoted interest if certain return thresholds are met.
During the year ended December 31, 2006 the joint venture began construction on two buildings. Under the terms of the joint venture arrangement, the Company is obligated to complete development of the buildings, the estimated cost of which is approximately $39 million.
The Company recognized $777,000 for development and property management services during the year ended December 31, 2006.
Other Joint Ventures
As of December 31, 2006, the Company had a 50% ownership interest in three additional unconsolidated joint ventures. These joint ventures have investments in properties under development, land or in leaseholds and do not operate or own operating properties.
The Company’s share of each of the joint venture’s earnings is included in equity in earnings (loss) of unconsolidated joint ventures in the accompanying consolidated statements of operations.
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The condensed balance sheets as of December 31, 2006 and 2005 and statements of operations for Liberty Venture I, LP, Liberty Illinois, LP, Kings Hill Unit Trust and other unconsolidated joint ventures for the years ended December 31, 2006, 2005 and 2004 are as follows (in thousands):
Balance Sheets:
| | | | | | | | | | | | | | | | | | | | | |
| | | December 31, 2006 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Real estate assets | | $ | 116,324 | | | $ | 119,787 | | | $ | 228,120 | | | $ | — | | | $ | 464,231 | |
| Accumulated depreciation | | | (10,183 | ) | | | (1,842 | ) | | | (4,213 | ) | | | — | | | | (16,238 | ) |
| | | | | | | | | | | | | | | | |
| Real estate assets, net | | | 106,141 | | | | 117,945 | | | | 223,907 | | | | — | | | | 447,993 | |
| Development in progress | | | — | | | | 28,420 | | | | — | | | | 24,088 | | | | 52,508 | |
| Land held for development | | | 2,733 | | | | 8,246 | | | | — | | | | 31,078 | | | | 42,057 | |
| Other assets | | | 13,723 | | | | 6,214 | | | | 20,838 | | | | 13,024 | | | | 53,799 | |
| | | | | | | | | | | | | | | | |
| Total assets | | $ | 122,597 | | | $ | 160,825 | | | $ | 244,745 | | | $ | 68,190 | | | $ | 596,357 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Debt | | $ | 74,063 | | | $ | 86,681 | | | $ | 186,010 | | | $ | 10,600 | | | $ | 357,354 | |
| Other liabilities | | | 1,182 | | | | 5,005 | | | | 49,584 | | | | 4,420 | | | | 60,191 | |
| Equity | | | 47,352 | | | | 69,139 | | | | 9,151 | | | | 53,170 | | | | 178,812 | |
| | | | | | | | | | | | | | | | |
| Total liabilities and equity | | $ | 122,597 | | | $ | 160,825 | | | $ | 244,745 | | | $ | 68,190 | | | $ | 596,357 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Company’s net investment in unconsolidated joint ventures (1) | | $ | 11,293 | | | $ | 11,259 | | | $ | — | | | $ | 24,644 | | | $ | 47,196 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | December 31, 2005 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Real estate assets | | $ | 121,092 | | | $ | — | | | $ | 202,200 | | | $ | — | | | $ | 323,292 | |
| Accumulated depreciation | | | (7,579 | ) | | | — | | | | (284 | ) | | | — | | | | (7,863 | ) |
| | | | | | | | | | | | | | | | |
| Real estate assets, net | | | 113,513 | | | | — | | | | 201,916 | | | | — | | | | 315,429 | |
| Development in progress | | | — | | | | — | | | | — | | | | — | | | | — | |
| Land held for development | | | 2,750 | | | | — | | | | — | | | | 37,812 | | | | 40,562 | |
| Other assets | | | 14,922 | | | | — | | | | 18,499 | | | | 9,980 | | | | 43,401 | |
| | | | | | | | | | | | | | | | |
| Total assets | | $ | 131,185 | | | $ | — | | | $ | 220,415 | | | $ | 47,792 | | | $ | 399,392 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Debt | | $ | 77,826 | | | $ | — | | | $ | 163,448 | | | $ | — | | | $ | 241,274 | |
| Other liabilities | | | 2,284 | | | | — | | | | 44,028 | | | | 678 | | | | 46,990 | |
| Equity | | | 51,075 | | | | — | | | | 12,939 | | | | 47,114 | | | | 111,128 | |
| | | | | | | | | | | | | | | | |
| Total liabilities and equity | | $ | 131,185 | | | $ | — | | | $ | 220,415 | | | $ | 47,792 | | | $ | 399,392 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Company’s net investment in unconsolidated joint ventures (1) | | $ | 12,310 | | | $ | — | | | $ | — | | | $ | 21,212 | | | $ | 33,522 | |
| | | | | | | | | | | | | | | | |
| | |
| (1) | | Differences between the Company’s net investment is unconsolidated joint ventures and its underlying equity in the net assets of the venture is primarily a result of the deferral of gains associated with the sales of properties to joint ventures in which the Company retains an ownership interest. Deferred gains are amortized to equity in earnings (loss) of joint ventures over the average estimated useful lives of the assets sold. |
85
Statements of Operations:
| | | | | | | | | | | | | | | | | | | | | |
| | | Year Ended December 31, 2006 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Total revenue | | $ | 18,395 | | | $ | 7,471 | | | $ | 18,183 | | | $ | — | | | $ | 44,049 | |
| Operating expense | | | 5,364 | | | | 1,833 | | | | 2,181 | | | | 171 | | | | 9,549 | |
| | | | | | | | | | | | | | | | |
| | | | 13,031 | | | | 5,638 | | | | 16,002 | | | | (171 | ) | | | 34,500 | |
| | | | | | | | | | | | | | | | | | | | | |
| Interest | | | (4,501 | ) | | | (2,527 | ) | | | (13,455 | ) | | | — | | | | (20,483 | ) |
| Depreciation and amortization | | | (4,544 | ) | | | (2,502 | ) | | | (6,267 | ) | | | — | | | | (13,313 | ) |
| Other income/(expense) | | | (127 | ) | | | 5 | | | | (604 | ) | | | 392 | | | | (334 | ) |
| Gain on sale | | | 2,644 | | | | — | | | | — | | | | 138 | | | | 2,782 | |
| | | | | | | | | | | | | | | | |
| Net income (loss) | | $ | 6,503 | | | $ | 614 | | | $ | (4,324 | ) | | $ | 359 | | | $ | 3,152 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Company’s equity in earnings (loss) of unconsolidated joint ventures | | $ | 1,651 | | | $ | 259 | | | $ | (657 | ) | | $ | 179 | | | $ | 1,432 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | Year Ended December 31, 2005 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Total revenue | | $ | 18,592 | | | $ | — | | | $ | 745 | | | $ | — | | | $ | 19,337 | |
| Operating expense | | | 5,859 | | | | — | | | | 201 | | | | 32 | | | | 6,092 | |
| | | | | | | | | | | | | | | | |
| | | | 12,733 | | | | — | | | | 544 | | | | (32 | ) | | | 13,245 | |
| | | | | | | | | | | | | | | | | | | | | |
| Interest | | | (4,569 | ) | | | — | | | | (634 | ) | | | — | | | | (5,203 | ) |
| Depreciation and amortization | | | (4,933 | ) | | | — | | | | (386 | ) | | | — | | | | (5,319 | ) |
| Other income/(expense) | | | (184 | ) | | | — | | | | (33 | ) | | | 3,066 | | | | 2,849 | |
| Gain on sale | | | 7,555 | | | | — | | | | — | | | | — | | | | 7,555 | |
| | | | | | | | | | | | | | | | |
| Net income (loss) | | $ | 10,602 | | | $ | — | | | $ | (509 | ) | | $ | 3,034 | | | $ | 13,127 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Company’s equity in earnings (loss) of unconsolidated joint ventures | | $ | 2,650 | | | $ | — | | | $ | (110 | ) | | $ | — | | | $ | 2,540 | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| | | Year Ended December 31, 2004 | |
| | | Liberty | | | Liberty | | | Kings Hill | | | | | | | |
| | | Venture I, LP | | | Illinois, LP | | | Unit Trust | | | Other | | | Total | |
| Total revenue | | $ | 18,746 | | | $ | — | | | $ | — | | | $ | — | | | $ | 18,746 | |
| Operating expense | | | 6,736 | | | | — | | | | — | | | | — | | | | 6,736 | |
| | | | | | | | | | | | | | | | |
| | | | 12,010 | | | | — | | | | — | | | | — | | | | 12,010 | |
| | | | | | | | | | | | | | | | | | | | | |
| Interest | | | (4,426 | ) | | | — | | | | — | | | | — | | | | (4,426 | ) |
| Depreciation and amortization | | | (10,683 | ) | | | — | | | | — | | | | — | | | | (10,683 | ) |
| | | | | | | | | | | | | | | | |
| Net loss | | $ | (3,099 | ) | | $ | — | | | $ | — | | | $ | — | | | $ | (3,099 | ) |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Company’s equity in loss of unconsolidated joint ventures | | $ | (775 | ) | | $ | — | | | $ | — | | | $ | — | | | $ | (775 | ) |
| | | | | | | | | | | | | | | | |
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5. DEFERRED FINANCING AND LEASING COSTS
Deferred financing and leasing costs at December 31, 2006 and 2005 are as follows (in thousands):
| | | | | | | | | |
| | | December 31, | |
| | | 2006 | | | 2005 | |
| Deferred leasing costs | | $ | 150,179 | | | $ | 154,886 | |
| Deferred financing costs | | | 8,476 | | | | 23,266 | |
| In-place lease value and related intangible asset | | | 71,496 | | | | 52,945 | |
| | | | | | | |
| | | | 230,151 | | | | 231,097 | |
| Accumulated amortization | | | (100,406 | ) | | | (108,103 | ) |
| | | | | | | |
| Total | | $ | 129,745 | | | $ | 122,994 | |
| | | | | | | |
6. INDEBTEDNESS
Indebtedness consists of mortgage loans, unsecured notes, borrowings under the credit facility and the Liberty/Commerz 1701 JFK Boulevard, LP financing arrangement. The weighted average interest rates for the years ended December 31, 2006, 2005 and 2004, were 6.6%, 6.6% and 6.7%, respectively. Interest costs during the years ended December 31, 2006, 2005 and 2004 in the amount of $30.8 million, $17.7 million and $13.2 million, respectively, were capitalized. Cash paid for interest for the years ended December 31, 2006, 2005 and 2004, was $150.2 million, $148.8 million and $130.4 million, respectively.
During the year ended December 31, 2006, the Company satisfied a $100 million 6.95% medium term note and issued a $300 million 5.50% senior unsecured note due December 15, 2016. The Company used the net proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.
During the year ended December 31, 2005, the Company issued a $300 million 5.125% senior unsecured note due March 2, 2015. The Company used the net proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.
The Company is subject to financial covenants contained in some of the debt agreements, the most restrictive of which are detailed below under the heading “Credit Facility.” As of December 31, 2006 the Company was in compliance with all financial covenants.
Mortgage Loans, Unsecured Notes
Mortgage loans with maturities ranging from 2007 to 2021 are collateralized by and in some instances cross-collateralized by properties with a net book value of $330.0 million.
The interest rates on $2,141.0 million of mortgage loans and unsecured notes are fixed and range from 4.6% to 8.8%. The weighted average remaining term for the mortgage loans and unsecured notes is 6.0 years.
Credit Facility
$600 Million Unsecured Revolving Credit Facility
During the fourth quarter of 2005, the Company obtained a four-year, $600 million unsecured revolving credit facility (the “$600 million Credit Facility”) replacing a $450 million unsecured revolving credit facility due January 16, 2006. Based on the Company’s present ratings, borrowings under the $600 million Credit Facility are priced at LIBOR plus 65 basis points. The $600 million Credit Facility contains a competitive bid option, whereby participating lenders bid on the interest rate to be charged. This feature is available for up to 50% of the amount of the facility. The interest rate on the $94.0 million of borrowings outstanding as of December 31, 2006 was 5.59%. The current ratings for the Company’s senior unsecured debt are Baa2, BBB, and BBB+ from Moody’s, S&P and Fitch, respectively. The $600 million Credit Facility has an accordion feature for an additional $200 million. There is also a 15 basis point annual facility fee on the current borrowing capacity. The $600 million Credit Facility expires on January 16, 2010 and may be extended for a one-year period. The $600 million Credit Facility contains financial covenants, certain of which are set forth below:
| | • | | total debt to total assets may not exceed 0.60:1; |
| |
| | • | | earnings before interest, taxes, depreciation and amortization to fixed charges may not be less than 1.50:1; |
| |
| | • | | unsecured debt to unencumbered asset value must equal or be less than 60%; and |
| |
| | • | | unencumbered net operating income to unsecured interest expense must equal or exceed 200%. |
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Liberty/Commerz 1701 JFK Boulevard, LP Financing Arrangement
The equity contribution from the Company’s joint venture partner in the Liberty/Commerz 1701 JFK Boulevard, LP is treated as a financing arrangement — see Note 4. This equity contribution receives a return equal to the greater of 5% or the current rate on the $600 million Credit Facility.
The scheduled principal amortization and maturities of the Company’s mortgage loans, the unsecured notes outstanding, the $600 million Credit Facility, the Liberty/Commerz 1701 JFK Boulevard, LP financing arrangement and the related weighted average interest rates are as follows (in thousands, except percentages):
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | Weighted | |
| | | Mortgages | | | | | | | | | | | | | | | Average | |
| | | Principal | | | Principal | | | Unsecured | | | Credit | | | | | | | Interest | |
| | | Amortization | | | Maturities | | | Notes | | | Facility | | | Total | | | Rate | |
| 2007 | | $ | 8,820 | | | $ | 1,553 | | | $ | 100,000 | | | $ | — | | | $ | 110,373 | | | | 7.22 | % |
| 2008 | | | 7,975 | | | | 39,753 | | | | — | | | | 152,960 | (1) | | | 200,688 | | | | 6.15 | % |
| 2009 | | | 5,699 | | | | 46,148 | | | | 270,000 | | | | — | | | | 321,847 | | | | 7.77 | % |
| 2010 | | | 4,877 | | | | 4,738 | | | | 200,000 | | | | 94,000 | | | | 303,615 | | | | 7.51 | % |
| 2011 | | | 4,153 | | | | 10,730 | | | | 250,000 | | | | — | | | | 264,883 | | | | 7.26 | % |
| 2012 | | | 3,274 | | | | 32,911 | | | | 235,000 | | | | — | | | | 271,185 | | | | 6.47 | % |
| 2013 | | | 2,751 | | | | — | | | | — | | | | — | | | | 2,751 | | | | 6.00 | % |
| 2014 | | | 2,894 | | | | 2,681 | | | | 200,000 | | | | — | | | | 205,575 | | | | 5.65 | % |
| 2015 | | | 3,033 | | | | — | | | | 300,000 | | | | — | | | | 303,033 | | | | 5.13 | % |
| 2016 | | | 2,220 | | | | — | | | | 300,000 | | | | — | | | | 302,220 | | | | 5.50 | % |
| 2017 & thereafter | | | 1,768 | | | | — | | | | 100,000 | | | | — | | | | 101,768 | | | | 7.47 | % |
| | | | | | | | | | | | | | | | | | | |
| | | $ | 47,464 | | | $ | 138,514 | | | $ | 1,955,000 | | | $ | 246,960 | | | $ | 2,387,938 | | | | 6.55 | % |
| | | | | | | | | | | | | | | | | | | |
| | |
| (1) | | Liberty/Commerz 1701 JFK Boulevard, LP financing arrangement — see above. |
7. LEASING ACTIVITY
Future minimum rental payments due from tenants under noncancelable operating leases as of December 31, 2006 are as follows (in thousands):
| | | | | |
| 2007 | | $ | 446,997 | |
| 2008 | | | 399,549 | |
| 2009 | | | 333,841 | |
| 2010 | | | 269,376 | |
| 2011 | | | 203,081 | |
| Thereafter | | | 468,809 | |
| | | | |
| TOTAL | | $ | 2,121,653 | |
| | | | |
In addition to minimum rental payments, most leases require the tenants to pay for their pro rata share of specified operating expenses. These payments are included as operating expense reimbursement in the accompanying consolidated statements of operations.
8. OWNERS’ EQUITY
Common Units
General and Limited partners’ equity — common units relates to limited partnership interests of the Operating Partnership issued in connection with the formation of the Company and certain subsequent acquisitions. During 2006, 684,432 common units were issued in connection with an acquisition. No common units were issued in connection with acquisitions during 2005 or 2004. The common units outstanding as of December 31, 2006 have the same economic characteristics as common shares of the Trust. The 4,189,967 common units share proportionately in the net income or loss and in any distributions of the Operating Partnership and are exchangeable into the same number of common shares of the Trust.
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Preferred Units
The Company has outstanding the following Cumulative Redeemable Preferred Units of the Operating Partnership, (the “Preferred Units”):
| | | | | | | | | | | | | | | | | | | | | | | |
| Date of | | | | | | | | | | | | Liquidation | | Dividend | | Redeemable | | |
| Issue | | Issue | | Amount | | Units | | Preference | | Rate | | As of | | Exchangeable After |
| | | | | (in 000’s) | | | | | | | | | | | | |
| 7/28/99 | | Series B | | $ | 95,000 | | | | 3,800 | | | $ | 25 | | | | 7.45 | % | | 8/31/09 | | 1/1/14 into Series B Cumulative
Redeemable Preferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | |
| 6/10/02 | | Series D | | $ | 23,650 | | | | 473 | | | $ | 50 | | | | 7.625 | % | | 6/10/07 | | 6/10/12 into Series D Cumulative
Redeemable Preferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | |
| 6/16/05 | | Series E | | $ | 20,000 | | | | 400 | | | $ | 50 | | | | 7.00 | % | | 6/16/10 | | 6/16/15 into Series E Cumulative
Redeemable Preferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | |
| 6/30/05 | | Series F | | $ | 44,000 | | | | 880 | | | $ | 50 | | | | 6.65 | % | | 6/30/10 | | 6/30/15 into Series F Cumulative
Redeemable Preferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | |
| 8/23/05 | | Series F | | $ | 6,000 | | | | 120 | | | $ | 50 | | | | 6.65 | % | | 6/30/10 | | 6/30/15 into Series F Cumulative
Redeemable Preferred Shares of the Trust |
| | | | | | | | | | | | | | | | | | | | | | | |
| 12/15/06 | | Series G | | $ | 27,000 | | | | 540 | | | $ | 50 | | | | 6.70 | % | | 12/12/11 | | 12/12/16 into Series G Cumulative
Redeemable Preferred Shares of the Trust |
Effective August 31, 2004, the distribution rate on the $95 million Series B preferred units was reduced from 9.25% to 7.45%.
During the year ended December 31, 2005, the Company redeemed for $20 million its outstanding 9.125% Series C Cumulative Redeemable Preferred Units.
The Company paid the following Preferred Unit distributions for the year ended December 31:
| | | | | | | | | | | | | |
| | | 2006 | | 2005 | | 2004 |
| Distributions (in millions) | | $ | 13.7 | | | $ | 12.1 | | | $ | 11.8 | |
| Distribution per unit: | | | | | | | | | | | | |
| Series B | | $ | 1.86 | | | $ | 1.86 | | | $ | 2.16 | |
| Series C | | | — | | | $ | 1.05 | | | $ | 2.28 | |
| Series D | | $ | 3.81 | | | $ | 3.81 | | | $ | 3.81 | |
| Series E | | $ | 3.50 | | | $ | 1.90 | | | | — | |
| Series F | | $ | 3.33 | | | $ | 1.61 | | | | — | |
| Series G | | $ | 0.16 | | | | — | | | | — | |
Minority Interest
Minority interest includes third-party ownership interests in consolidated joint venture investments.
9. COMMITMENTS AND CONTINGENCIES
Substantially all of the Properties and land were subject to Phase I Environmental Assessments and when appropriate Phase II Environmental Assessments (collectively, the “Environmental Assessments”) obtained in contemplation of their acquisition by the Company. The Environmental Assessments consisted of, among other activities, a visual inspection of each Property and its neighborhood and a check of pertinent public records. The Environmental Assessments did not reveal, nor is the Company aware of, any non-compliance with environmental laws, environmental liability or other environmental claim that the Company believes would likely have a material adverse effect on the Company.
Although the Company is engaged in litigation incidental to its business, there is no legal proceeding to which it is a party which, in the opinion of management, will materially adversely affect the results of the Company’s operations.
The Company is obligated to make additional capital contributions to unconsolidated joint ventures of $1.0 million.
The Company has letter of credit obligations of $1.6 million related to development requirements.
The Company maintains cash and cash equivalents at financial institutions. The combined account balances at each institution typically exceed FDIC insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes the risk is not significant.
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10. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
A summary of quarterly results of operations for the years ended December 31, 2006 and 2005 follows. Certain amounts have been reclassified to conform to the current presentation of discontinued operations (in thousands, except per share amounts).
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Quarter Ended | |
| | | Dec. 31, | | | Sept. 30, | | | June 30, | | | Mar. 31, | | | Dec. 31, | | | Sept. 30, | | | June 30, | | | Mar. 31, | |
| | | 2006 | | | 2006 | | | 2006 | | | 2006 | | | 2005 | | | 2005 | | | 2005 | | | 2005 | |
| Operating revenue | | $ | 175,702 | | | $ | 167,026 | | | $ | 163,799 | | | $ | 160,192 | | | $ | 160,517 | | | $ | 157,949 | | | $ | 162,754 | | | $ | 152,274 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Income from continuing operations | | | 41,283 | | | | 40,069 | | | | 56,549 | | | | 36,214 | | | | 109,977 | | | | 36,403 | | | | 39,365 | | | | 39,915 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Discontinued operations | | | 25,821 | | | | 12,405 | | | | 18,514 | | | | 61,195 | | | | 5,015 | | | | 20,903 | | | | 10,164 | | | | 10,217 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Income available to common unitholders | | | 63,616 | | | | 49,073 | | | | 71,662 | | | | 94,008 | | | | 111,589 | | | | 53,953 | | | | 46,366 | | | | 47,456 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Income per common unit — basic (1) | | $ | 0.67 | | | $ | 0.52 | | | $ | 0.77 | | | $ | 1.02 | | | $ | 1.22 | | | $ | 0.59 | | | $ | 0.51 | | | $ | 0.53 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Income per common unit — diluted (1) | | $ | 0.67 | | | $ | 0.52 | | | $ | 0.76 | | | $ | 1.01 | | | $ | 1.20 | | | $ | 0.58 | | | $ | 0.51 | | | $ | 0.52 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | |
| (1) | | The sum of quarterly financial data may vary from the annual data due to rounding. |
11. SEGMENT INFORMATION
The Company operates its portfolio of properties primarily throughout the Mid-Atlantic, Southeastern and Midwestern United States. Additionally, the Company owns certain assets in the United Kingdom. The Company reviews the performance of the portfolio on a geographical basis. As such, the following regions are considered the Company’s reportable segments:
| | | |
| Reportable Segments | | Markets |
| Delaware Valley | | Southeastern Pennsylvania; New Jersey |
| Midwest | | Lehigh Valley, Pennsylvania; Michigan; Minnesota; Milwaukee; Chicago |
| Mid-Atlantic | | Maryland; Piedmont Triad, NC; Greenville, SC; Richmond; Virginia Beach |
| Florida | | Jacksonville; Orlando; Boca Raton; Tampa; Texas |
| United Kingdom | | County of Kent |
The Company’s reportable segments are distinct business units which are each managed separately in order to concentrate market knowledge within a geographic area. Within these reportable segments, the Company derives its revenues from its two product types: industrial properties and office properties.
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The Company evaluates performance of the reportable segments based on property level operating income, which is calculated as rental revenue and operating expense reimbursement less rental property expenses and real estate taxes. The accounting policies of the reportable segments are the same as those for the Company on a consolidated basis. The operating information by segment is as follows (in thousands):
YEAR ENDED DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | Mid- | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Atlantic | | | Florida | | | Kingdom | | | Total | |
| Operating revenue | | $ | 187,817 | | | $ | 38,730 | | | $ | 85,180 | | | $ | 116,324 | | | $ | 122,014 | | | $ | 112,788 | | | $ | 3,866 | | | $ | 666,719 | |
| Rental property expenses and real estate taxes | | | 58,545 | | | | 12,718 | | | | 18,747 | | | | 42,839 | | | | 37,566 | | | | 37,428 | | | | 2,864 | | | | 210,707 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property level operating income | | $ | 129,272 | | | $ | 26,012 | | | $ | 66,433 | | | $ | 73,485 | | | $ | 84,448 | | | $ | 75,360 | | | $ | 1,002 | | | | 456,012 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest and other income | | | 9,591 | |
| Interest expense | | | (119,584 | ) |
| General and administrative | | | (45,991 | ) |
| Depreciation and amortization | | | (144,692 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures | | | 155,336 | |
| Gain on property dispositions | | | 17,628 | |
| Income taxes | | | (288 | ) |
| Minority interest | | | 7 | |
| Equity in earnings of unconsolidated joint ventures | | | 1,432 | |
| Discontinued operations | | | 117,935 | |
| Preferred unit distributions | | | (13,691 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income available to common unitholders | | $ | 278,359 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
YEAR ENDED DECEMBER 31, 2005
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | Mid- | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Atlantic | | | Florida | | | Kingdom | | | Total | |
| Operating revenue | | $ | 187,212 | | | $ | 37,521 | | | $ | 77,219 | | | $ | 110,190 | | | $ | 104,794 | | | $ | 96,229 | | | $ | 20,329 | | | $ | 633,494 | |
| Rental property expenses and real estate taxes | | | 55,706 | | | | 13,139 | | | | 19,661 | | | | 39,878 | | | | 31,614 | | | | 31,556 | | | | 3,678 | | | | 195,232 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property level operating income | | $ | 131,506 | | | $ | 24,382 | | | $ | 57,558 | | | $ | 70,312 | | | $ | 73,180 | | | $ | 64,673 | | | $ | 16,651 | | | | 438,262 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest and other income | | | 8,008 | |
| Interest expense | | | (119,614 | ) |
| General and administrative | | | (38,099 | ) |
| Depreciation and amortization | | | (135,846 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures | | | 152,711 | |
| Gain on property dispositions | | | 85,593 | |
| Income taxes | | | (14,827 | ) |
| Minority interest | | | (357 | ) |
| Equity in earnings of unconsolidated joint ventures | | | 2,540 | |
| Discontinued operations | | | 46,299 | |
| Preferred unit distributions | | | (12,095 | ) |
| Excess of preferred unit redemption over carrying amount | | | (500 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income available to common unitholders | | $ | 259,364 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
91
YEAR ENDED DECEMBER 31, 2004
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | Mid- | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Atlantic | | | Florida | | | Kingdom | | | Total | |
| Operating revenue | | $ | 177,655 | | | $ | 32,680 | | | $ | 66,731 | | | $ | 102,824 | | | $ | 99,395 | | | $ | 86,267 | | | $ | 19,732 | | | $ | 585,284 | |
| Rental property expenses and real estate taxes | | | 51,943 | | | | 11,048 | | | | 17,087 | | | | 37,341 | | | | 26,715 | | | | 26,744 | | | | 3,166 | | | | 174,044 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property level operating income | | $ | 125,712 | | | $ | 21,632 | | | $ | 49,644 | | | $ | 65,483 | | | $ | 72,680 | | | $ | 59,523 | | | $ | 16,566 | | | | 411,240 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest and other income | | | 6,266 | |
| Interest expense | | | (107,027 | ) |
| General and administrative | | | (33,724 | ) |
| Depreciation and amortization | | | (119,934 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income before property dispositions, income taxes, minority interest and equity in loss of unconsolidated joint ventures | | | 156,821 | |
| Gain on property dispositions | | | 496 | |
| Income taxes | | | (1,820 | ) |
| Minority interest | | | 632 | |
| Equity in loss of unconsolidated joint ventures | | | (775 | ) |
| Discontinued operations | | | 24,888 | |
| Preferred share distributions | | | (11,844 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income available to common unitholders | | $ | 168,398 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Product Type Information | | Real Estate Related Revenues | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
| Industrial | | $ | 284,551 | | | $ | 268,958 | | | $ | 247,379 | |
| Office | | | 382,168 | | | | 364,536 | | | | 337,905 | |
| | | | | | | | | | |
| Total operating revenue | | $ | 666,719 | | | $ | 633,494 | | | $ | 585,284 | |
| | | | | | | | | | |
ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | Mid- | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Atlantic | | | Florida | | | Kingdom | | | Total | |
| January 1, 2006 | | $ | 1,060,198 | | | $ | 183,020 | | | $ | 637,301 | | | $ | 833,618 | | | $ | 913,735 | | | $ | 646,681 | | | $ | 9,838 | | | $ | 4,284,391 | |
| Additions | | | 74,852 | | | | 36,807 | | | | 15,006 | | | | 37,853 | | | | 104,185 | | | | 275,474 | | | | 1,597 | | | | 545,774 | |
| Dispositions | | | (55,255 | ) | | | (4,422 | ) | | | (69,832 | ) | | | (91,464 | ) | | | (116,680 | ) | | | — | | | | — | | | | (337,653 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| December 31, 2006 | | $ | 1,079,795 | | | $ | 215,405 | | | $ | 582,475 | | | $ | 780,007 | | | $ | 901,240 | | | $ | 922,155 | | | $ | 11,435 | | | | 4,492,512 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Accumulated depreciation | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (806,309 | ) |
| Development in progress | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 538,303 | |
| Land held for development | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 195,332 | |
| Assets held for sale | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 40,715 | |
| Other assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 450,358 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total assets at December 31, 2006 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 4,910,911 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
92
ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Delaware Valley | | | Midwest | | | | | | | | | | | | | | |
| | | Southeastern | | | | | | | Lehigh | | | | | | | Mid- | | | | | | | United | | | | |
| | | Pennsylvania | | | Other | | | Valley | | | Other | | | Atlantic | | | Florida | | | Kingdom | | | Total | |
| January 1, 2005 | | $ | 1,020,714 | | | $ | 190,116 | | | $ | 558,590 | | | $ | 746,207 | | | $ | 828,809 | | | $ | 651,123 | | | $ | 169,304 | | | $ | 4,164,863 | |
| Additions | | | 44,071 | | | | 14,857 | | | | 84,698 | | | | 114,253 | | | | 115,341 | | | | 37,772 | | | | 10,832 | | | | 421,824 | |
| Dispositions | | | (4,587 | ) | | | (21,953 | ) | | | (5,987 | ) | | | (26,842 | ) | | | (30,415 | ) | | | (42,214 | ) | | | (170,298 | ) | | | (302,296 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| December 31, 2006 | | $ | 1,060,198 | | | $ | 183,020 | | | $ | 637,301 | | | $ | 833,618 | | | $ | 913,735 | | | $ | 646,681 | | | $ | 9,838 | | | | 4,284,391 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Accumulated depreciation | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (732,439 | ) |
| Development in progress | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 324,924 | |
| Land held for development | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 158,653 | |
| Assets held for sale | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 73,211 | |
| Other assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 391,582 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total assets at December 31, 2005 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | $ | 4,500,322 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
12. SFAS NO. 144 “ACCOUNTING FOR THE IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS”
Discontinued Operations
In accordance with SFAS No. 144, the operating results and gain/(loss) on disposition of real estate for properties sold and held for sale are reflected in the consolidated statements of operations as discontinued operations. Prior year financial statements have been adjusted for discontinued operations. The proceeds from dispositions of operating properties with no continuing involvement were $395.9 million and $200.9 million for the years ended December 31, 2006 and 2005, respectively.
Below is a summary of the results of operations of the properties disposed of and held for sale through the respective disposition dates (in thousands):
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
| Revenues | | $ | 28,399 | | | $ | 60,202 | | | $ | 70,580 | |
| Operating expenses | | | (11,170 | ) | | | (20,332 | ) | | | (23,244 | ) |
| Interest expense | | | (4,662 | ) | | | (15,814 | ) | | | (17,470 | ) |
| Depreciation and amortization | | | (7,252 | ) | | | (14,374 | ) | | | (16,581 | ) |
| | | | | | | | | | |
| Income before property dispositions and minority interest | | $ | 5,315 | | | $ | 9,682 | | | $ | 13,285 | |
| | | | | | | | | | |
The held for sale properties consist of three properties totaling 352,000 square feet in the Company’s Midwest — Other segment. The properties held for sale as of December 31, 2006 were sold in January 2007.
Interest expense is allocated to discontinued operations as permitted under EITF Issue 87-24, "Allocation of Interest to Discontinued Operations,” and such interest expense has been included in computing income from discontinued operations. The allocation of interest expense to discontinued operations was based on the ratio of net assets sold (without continuing involvement) or held for sale to the sum of total net assets plus consolidated debt.
Asset Impairment
In accordance with SFAS No. 144, during the years ended December 31, 2006 and 2005, the Company recognized impairment losses of $4.2 million and $5.3 million, respectively. The 2006 impairment loss of $4.2 million was primarily related to a 352,000 square foot portfolio of operating properties in the Midwest — Other segment. The 2005 impairment loss of $5.3 million was primarily related to a portfolio of operating properties equaling 615,000 square feet in the Midwest — Other segment. For the years ended December 31, 2006 and 2005, respectively, $4.2 million and $3.7 million related to properties sold or held for sale were included in the caption discontinued operations in the Company’s statement of operations. For the years ended December 31, 2005 and 2004, respectively, $1.6 million and $1.4 million in impairments were included in the caption gain on property dispositions as a component of income from continuing operations. The Company determined these impairments through a comparison of the aggregate future cash flows (including quoted offer prices) to be generated by the properties to the carrying value of the properties. The Company has evaluated each of the properties and land held for development and has determined that there are no additional valuation adjustments necessary at December 31, 2006.
93
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | |
| | | | | | | | | Initial Cost | | | Capitalized | | | Gross Amount Carried at End of Period | | | | | Date of | | | | |
| | | | | | | | | | | | | | | | | Subsequent | | | | | | | | | | | | | | | Accumulated | | Construction | | | Depreciable | |
| | | | | | | | | | | | | | | | | to | | | Land and | | | Building and | | | Total | | | Depreciation | | or | | | life | |
| Project | | Location | | Encumbrances | | | Land | | | Building | | | Acquisition | | | Improvements | | | Improvements | | | 12/31/2006 | | | 12/31/06 | | Acquisition | | | (years) | |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 1501 Perryman Road | | Aberdeen, MD | | $ | — | | | $ | 5,813,324 | | | $ | 18,874,059 | | | $ | 3,274,480 | | | $ | 5,816,839 | | | $ | 22,145,024 | | | $ | 27,961,863 | | | $7,560 | | | 2005 | | | 40 yrs. |
| 2196 Avenue C | | Allentown, PA | | | — | | | | 101,159 | | | | — | | | | 1,347,970 | | | | 107,307 | | | | 1,341,822 | | | | 1,449,129 | | | 750,775 | | | 1980 | | | 40 yrs. |
| 2202 Hanger Place | | Allentown, PA | | | * | | | | 137,439 | | | | — | | | | 1,341,155 | | | | 138,127 | | | | 1,340,466 | | | | 1,478,594 | | | 826,310 | | | 1981 | | | 40 yrs. |
| 7437 Industrial Boulevard | | Allentown, PA | | | — | | | | 717,488 | | | | 5,022,413 | | | | 2,425,462 | | | | 726,651 | | | | 7,438,711 | | | | 8,165,362 | | | 2,459,321 | | | 1976 | | | 40 yrs. |
| 7339 Industrial Boulevard | | Allentown, PA | | | * | | | | 1,187,776 | | | | — | | | | 6,324,599 | | | | 1,197,447 | | | | 6,314,928 | | | | 7,512,376 | | | 1,930,459 | | | 1996 | | | 40 yrs. |
| 400 Nestle Way | | Allentown, PA | | | 22,630,797 | | | | 8,065,500 | | | | — | | | | 27,253,022 | | | | 8,184,096 | | | | 27,134,426 | | | | 35,318,522 | | | 7,218,734 | | | 1997 | | | 40 yrs. |
| 7248 Industrial Boulevard | | Allentown, PA | | | — | | | | 2,670,849 | | | | 13,307,408 | | | | 1,101,923 | | | | 2,670,673 | | | | 14,409,506 | | | | 17,080,179 | | | 3,732,710 | | | 1988 | | | 40 yrs. |
| 700 Nestle Way | | Allentown, PA | | | — | | | | 3,473,120 | | | | — | | | | 18,116,440 | | | | 4,174,970 | | | | 17,414,590 | | | | 21,589,560 | | | 4,014,467 | | | 1998 | | | 40 yrs. |
| 7562 Penn Drive | | Allentown, PA | | | — | | | | 269,614 | | | | 844,069 | | | | 184,443 | | | | 269,614 | | | | 1,028,512 | | | | 1,298,126 | | | 259,319 | | | 1989 | | | 40 yrs. |
| 7277 Williams Avenue | | Allentown, PA | | | — | | | | 462,964 | | | | 1,449,009 | | | | 322,599 | | | | 463,123 | | | | 1,771,449 | | | | 2,234,572 | | | 538,729 | | | 1989 | | | 40 yrs. |
| 7355 Williams Avenue | | Allentown, PA | | | — | | | | 489,749 | | | | 1,658,091 | | | | 304,958 | | | | 489,749 | | | | 1,963,049 | | | | 2,452,798 | | | 465,129 | | | 1998 | | | 40 yrs. |
| 794 Roble Road | | Allentown, PA | | | — | | | | 1,147,541 | | | | 6,088,041 | | | | 1,125,815 | | | | 1,147,541 | | | | 7,213,857 | | | | 8,361,398 | | | 1,802,850 | | | 1985 | | | 40 yrs. |
| 6923 Schantz Spring Road | | Allentown, PA | | | * | | | | 1,127,805 | | | | 3,309,132 | | | | 348,419 | | | | 1,127,805 | | | | 3,657,551 | | | | 4,785,355 | | | 839,583 | | | 1993 | | | 40 yrs. |
| 7132 Daniels Drive | | Allentown, PA | | | — | | | | 1,623,326 | | | | 3,464,626 | | | | 4,174,016 | | | | 1,695,610 | | | | 7,566,357 | | | | 9,261,967 | | | 1,576,367 | | | 1988 | | | 40 yrs. |
| 8014 Industrial Boulevard | | Allentown, PA | | | — | | | | 4,019,258 | | | | — | | | | 9,446,162 | | | | 3,645,117 | | | | 9,820,303 | | | | 13,465,420 | | | 2,218,246 | | | 1999 | | | 40 yrs. |
| 705 Boulder Drive | | Allentown, PA | | | — | | | | 4,484,096 | | | | — | | | | 14,878,034 | | | | 4,486,836 | | | | 14,875,294 | | | | 19,362,130 | | | 2,387,484 | | | 2001 | | | 40 yrs. |
| 651 Boulder Drive | | Allentown, PA | | | * | | | | 4,308,646 | | | | — | | | | 13,284,432 | | | | 4,308,646 | | | | 13,284,432 | | | | 17,593,078 | | | 2,467,753 | | | 2000 | | | 40 yrs. |
| 8150 Industrial Boulevard | | Allentown, PA | | | — | | | | 2,564,167 | | | | — | | | | 8,906,845 | | | | 2,571,466 | | | | 8,899,547 | | | | 11,471,013 | | | 1,421,039 | | | 2002 | | | 40 yrs. |
| 8250 Industrial Boulevard | | Allentown, PA | | | — | | | | 1,025,667 | | | | — | | | | 5,346,179 | | | | 1,035,854 | | | | 5,335,991 | | | | 6,371,846 | | | 633,244 | | | 2002 | | | 40 yrs. |
| 650 Boulder Drive | | Allentown, PA | | | — | | | | 5,208,248 | | | | — | | | | 31,404,856 | | | | 9,961,788 | | | | 26,651,316 | | | | 36,613,104 | | | 2,728,758 | | | 2002 | | | 40 yrs. |
| 7165 Ambassador Drive | | Allentown, PA | | | * | | | | 792,999 | | | | — | | | | 4,533,868 | | | | 804,848 | | | | 4,522,019 | | | | 5,326,867 | | | 586,086 | | | 2002 | | | 40 yrs. |
| 200 Boulder Drive | | Allentown, PA | | | — | | | | 4,722,683 | | | | 18,922,645 | | | | 240,929 | | | | 4,722,683 | | | | 19,163,574 | | | | 23,886,258 | | | 1,081,207 | | | 2004 | | | 40 yrs. |
| 250 Boulder Drive | | Allentown, PA | | | — | | | | 3,623,328 | | | | 12,099,145 | | | | 1,144,216 | | | | 3,719,772 | | | | 13,146,917 | | | | 16,866,689 | | | 690,330 | | | 2004 | | | 40 yrs. |
| 6560 Stonegate Drive | | Allentown, PA | | | — | | | | 458,281 | | | | — | | | | 2,839,996 | | | | 458,945 | | | | 2,839,332 | | | | 3,298,277 | | | 1,116,992 | | | 1989 | | | 40 yrs. |
| 6370 Hedgewood Drive | | Allentown, PA | | | — | | | | 540,795 | | | | — | | | | 3,608,143 | | | | 541,459 | | | | 3,607,479 | | | | 4,148,938 | | | 1,356,701 | | | 1990 | | | 40 yrs. |
| 6390 Hedgewood Drive | | Allentown, PA | | | — | | | | 707,203 | | | | — | | | | 2,765,090 | | | | 707,867 | | | | 2,764,425 | | | | 3,472,293 | | | 1,317,332 | | | 1990 | | | 40 yrs. |
| 6350 Hedgewood Drive | | Allentown, PA | | | * | | | | 360,027 | | | | — | | | | 3,470,090 | | | | 560,691 | | | | 3,269,426 | | | | 3,830,117 | | | 1,390,438 | | | 1989 | | | 40 yrs. |
| 6330 Hedgewood Drive | | Allentown, PA | | | — | | | | 531,268 | | | | — | | | | 4,910,864 | | | | 532,047 | | | | 4,910,085 | | | | 5,442,132 | | | 2,333,532 | | | 1988 | | | 40 yrs. |
| 6580 Snowdrift Road | | Allentown, PA | | | — | | | | 388,328 | | | | — | | | | 3,284,907 | | | | 389,081 | | | | 3,284,155 | | | | 3,673,235 | | | 1,459,264 | | | 1988 | | | 40 yrs. |
| 6540 Stonegate Drive | | Allentown, PA | | | — | | | | 422,042 | | | | — | | | | 3,893,307 | | | | 422,730 | | | | 3,892,620 | | | | 4,315,349 | | | 1,829,429 | | | 1988 | | | 40 yrs. |
| 974 Marcon Boulevard | | Allentown, PA | | | — | | | | 143,500 | | | | — | | | | 2,469,917 | | | | 144,248 | | | | 2,469,170 | | | | 2,613,417 | | | 1,308,676 | | | 1987 | | | 40 yrs. |
| 964 Marcon Boulevard | | Allentown, PA | | | — | | | | 138,816 | | | | — | | | | 1,983,002 | | | | 139,480 | | | | 1,982,338 | | | | 2,121,818 | | | 913,043 | | | 1985 | | | 40 yrs. |
| 764 Roble Road | | Allentown, PA | | | — | | | | 141,069 | | | | — | | | | 864,405 | | | | 141,746 | | | | 863,728 | | | | 1,005,474 | | | 446,399 | | | 1985 | | | 40 yrs. |
| 3174 Airport Road | | Allentown, PA | | | — | | | | 98,986 | | | | — | | | | 1,157,004 | | | | 98,986 | | | | 1,157,004 | | | | 1,255,990 | | | 727,271 | | | 1979 | | | 40 yrs. |
| 2201 Hanger Place | | Allentown, PA | | | — | | | | 128,454 | | | | — | | | | 1,906,472 | | | | 129,142 | | | | 1,905,783 | | | | 2,034,926 | | | 1,121,868 | | | 1987 | | | 40 yrs. |
| 954 Marcon Boulevard | | Allentown, PA | | | — | | | | 103,665 | | | | — | | | | 1,110,937 | | | | 104,453 | | | | 1,110,149 | | | | 1,214,602 | | | 586,982 | | | 1981 | | | 40 yrs. |
| 754 Roble Road | | Allentown, PA | | | — | | | | 162,115 | | | | 1,731,885 | | | | 279,310 | | | | 163,735 | | | | 2,009,575 | | | | 2,173,310 | | | 677,125 | | | 1986 | | | 40 yrs. |
| 744 Roble Road | | Allentown, PA | | | — | | | | 159,771 | | | | 1,734,229 | | | | 266,454 | | | | 161,371 | | | | 1,999,083 | | | | 2,160,454 | | | 663,735 | | | 1986 | | | 40 yrs. |
| 944 Marcon Boulevard | | Allentown, PA | | | — | | | | 118,521 | | | | 1,435,479 | | | | 464,628 | | | | 119,711 | | | | 1,898,917 | | | | 2,018,628 | | | 633,568 | | | 1986 | | | 40 yrs. |
| 6520 Stonegate Drive | | Allentown, PA | | | — | | | | 453,315 | | | | — | | | | 1,787,903 | | | | 484,361 | | | | 1,756,857 | | | | 2,241,218 | | | 593,896 | | | 1996 | | | 40 yrs. |
| 2041 Avenue C | | Allentown, PA | | | — | | | | 213,599 | | | | 1,095,217 | | | | 83,135 | | | | 213,879 | | | | 1,178,072 | | | | 1,391,951 | | | 353,869 | | | 1990 | | | 40 yrs. |
| 7144 Daniels Drive | | Allentown, PA | | | — | | | | 2,390,217 | | | | 2,342,761 | | | | 3,721,684 | | | | 1,579,169 | | | | 6,875,493 | | | | 8,454,662 | | | 1,849,083 | | | 1975 | | | 40 yrs. |
| 7620 Cetronia Road | | Allentown, PA | | | — | | | | 1,091,806 | | | | 3,851,456 | | | | 356,371 | | | | 1,093,724 | | | | 4,205,910 | | | | 5,299,633 | | | 1,364,080 | | | 1990 | | | 40 yrs. |
| 180,190 Cochrane Drive | | Annapolis, MD | | | — | | | | 3,670,256 | | | | — | | | | 22,322,825 | | | | 3,752,293 | | | | 22,240,788 | | | | 25,993,081 | | | 8,676,942 | | | 1988 | | | 40 yrs. |
| 4606 Richlynn Drive | | Belcamp, MD | | | — | | | | 299,600 | | | | 1,818,861 | | | | 712,787 | | | | 299,600 | | | | 2,531,649 | | | | 2,831,249 | | | 470,711 | | | 1985 | | | 40 yrs. |
| 41199 Van Born Road | | Bellville, MI | | | — | | | | 1,829,396 | | | | 6,765,015 | | | | 509,937 | | | | 1,829,396 | | | | 7,274,952 | | | | 9,104,347 | | | 5,269 | | | 2005 | | | 40 yrs. |
| 41133 Van Born Road | | Bellville, MI | | | — | | | | 1,829,560 | | | | 6,454,755 | | | | 463,975 | | | | 1,829,560 | | | | 6,918,730 | | | | 8,748,290 | | | 5,877 | | | 2005 | | | 40 yrs. |
| 1655 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 214,431 | | | | — | | | | 2,019,753 | | | | 215,095 | | | | 2,019,088 | | | | 2,234,184 | | | 935,846 | | | 1993 | | | 40 yrs. |
| 1455 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 670,290 | | | | — | | | | 3,743,118 | | | | 545,172 | | | | 3,868,235 | | | | 4,413,408 | | | 1,742,880 | | | 1997 | | | 40 yrs. |
| 1640 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 359,000 | | | | — | | | | 2,538,675 | | | | 190,728 | | | | 2,706,947 | | | | 2,897,675 | | | 1,142,900 | | | 1996 | | | 40 yrs. |
| 1650 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 359,000 | | | | — | | | | 2,215,932 | | | | 188,896 | | | | 2,386,036 | | | | 2,574,932 | | | 942,344 | | | 1997 | | | 40 yrs. |
| 1660 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 359,000 | | | | — | | | | 2,278,206 | | | | 188,721 | | | | 2,448,485 | | | | 2,637,206 | | | 737,276 | | | 1998 | | | 40 yrs. |
| 83 South Commerce Way | | Bethlehem, PA | | | — | | | | 143,661 | | | | 888,128 | | | | 520,095 | | | | 212,744 | | | | 1,339,140 | | | | 1,551,884 | | | 521,859 | | | 1989 | | | 40 yrs. |
| 85 South Commerce Way | | Bethlehem, PA | | | — | | | | 236,708 | | | | 987,949 | | | | 169,265 | | | | 237,078 | | | | 1,156,844 | | | | 1,393,922 | | | 312,464 | | | 1989 | | | 40 yrs. |
| 87 South Commerce Way | | Bethlehem, PA | | | — | | | | 253,886 | | | | 1,062,881 | | | | 223,146 | | | | 253,886 | | | | 1,286,027 | | | | 1,539,913 | | | 383,776 | | | 1989 | | | 40 yrs. |
| 89 South Commerce Way | | Bethlehem, PA | | | — | | | | 320,000 | | | | — | | | | 2,011,186 | | | | 367,706 | | | | 1,963,481 | | | | 2,331,186 | | | 701,530 | | | 1998 | | | 40 yrs. |
| 1525 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 475,686 | | | | — | | | | 7,721,312 | | | | 804,104 | | | | 7,392,894 | | | | 8,196,998 | | | 1,900,307 | | | 1999 | | | 40 yrs. |
| 74 West Broad Street | | Bethlehem, PA | | | — | | | | 1,096,127 | | | | — | | | | 13,371,415 | | | | 1,099,079 | | | | 13,368,463 | | | | 14,467,542 | | | 2,582,086 | | | 2002 | | | 40 yrs. |
| 1605 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 729,751 | | | | — | | | | 11,065,717 | | | | 1,766,196 | | | | 10,029,272 | | | | 11,795,468 | | | 1,779,914 | | | 2000 | | | 40 yrs. |
| 3400 High Point Boulevard | | Bethlehem, PA | | | — | | | | 298,227 | | | | — | | | | 3,053,506 | | | | 662,809 | | | | 2,688,924 | | | | 3,351,733 | | | 367,073 | | | 2002 | | | 40 yrs. |
| 1495 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 434,640 | | | | — | | | | 4,695,697 | | | | 435,303 | | | | 4,695,034 | | | | 5,130,337 | | | 1,544,454 | | | 1990 | | | 40 yrs. |
| 1550 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 196,954 | | | | — | | | | 3,827,587 | | | | 197,700 | | | | 3,826,842 | | | | 4,024,541 | | | 1,470,951 | | | 1988 | | | 40 yrs. |
| 1560 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 240,069 | | | | — | | | | 4,638,646 | | | | 240,732 | | | | 4,637,983 | | | | 4,878,715 | | | 2,078,924 | | | 1988 | | | 40 yrs. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
94
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | |
| | | | | | | | | Initial Cost | | | Capitalized | | | Gross Amount Carried at End of Period | | | | | Date of | | | | |
| | | | | | | | | | | | | | | | | Subsequent | | | | | | | | | | | | | | | Accumulated | | Construction | | | Depreciable | |
| | | | | | | | | | | | | | | | | to | | | Land and | | | Building and | | | Total | | | Depreciation | | or | | | life | |
| Project | | Location | | Encumbrances | | | Land | | | Building | | | Acquisition | | | Improvements | | | Improvements | | | 12/31/2006 | | | 12/31/06 | | Acquisition | | | (years) | |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 1510 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 312,209 | | | | — | | | | 3,762,171 | | | | 312,873 | | | | 3,761,507 | | | | 4,074,380 | | | 1,704,910 | | | 1988 | | | 40 yrs. |
| 1530 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 211,747 | | | | — | | | | 3,008,631 | | | | 212,492 | | | | 3,007,886 | | | | 3,220,378 | | | 1,256,732 | | | 1988 | | | 40 yrs. |
| 57 South Commerce Way | | Bethlehem, PA | | | — | | | | 390,839 | | | | 2,701,161 | | | | 764,168 | | | | 395,459 | | | | 3,460,709 | | | | 3,856,168 | | | 1,189,140 | | | 1986 | | | 40 yrs. |
| 1685 Valley Center Parkway | | Bethlehem, PA | | | — | | | | 244,029 | | | | — | | | | 2,283,047 | | | | 198,482 | | | | 2,328,594 | | | | 2,527,076 | | | 838,903 | | | 1996 | | | 40 yrs. |
| 6601-6625 W. 78th Street | | Bloomington, MN | | | — | | | | 2,263,060 | | | | — | | | | 38,629,236 | | | | 2,310,246 | | | | 38,582,050 | | | | 40,892,296 | | | 7,893,682 | | | 1998 | | | 40 yrs. |
| 4801 West 81st Street | | Bloomington, MN | | | — | | | | 1,624,701 | | | | 2,494,368 | | | | 809,469 | | | | 1,624,701 | | | | 3,303,836 | | | | 4,928,537 | | | 864,938 | | | 1984 | | | 40 yrs. |
| 8100 Cedar Avenue | | Bloomington, MN | | | — | | | | 501,313 | | | | 3,675,416 | | | | 971,824 | | | | 501,313 | | | | 4,647,240 | | | | 5,148,553 | | | 1,214,704 | | | 1983 | | | 40 yrs. |
| 6161 Green Valley Drive | | Bloomington, MN | | | — | | | | 740,378 | | | | 3,311,602 | | | | 732,919 | | | | 741,194 | | | | 4,043,704 | | | | 4,784,898 | | | 745,201 | | | 1992 | | | 40 yrs. |
| 10801 Nesbitt Avenue South | | Bloomington, MN | | | — | | | | 784,577 | | | | — | | | | 4,105,182 | | | | 786,382 | | | | 4,103,377 | | | | 4,889,759 | | | 944,251 | | | 2001 | | | 40 yrs. |
| 5775 West Old Shakopee Road | | Bloomington, MN | | | — | | | | 2,052,018 | | | | 3,849,649 | | | | 3,311,678 | | | | 2,060,644 | | | | 7,152,700 | | | | 9,213,345 | | | 2,366,472 | | | 2002 | | | 40 yrs. |
| 5715 Old Shakopee Road West | | Bloomington, MN | | | — | | | | 1,263,226 | | | | 2,360,782 | | | | 1,954,672 | | | | 1,264,758 | | | | 4,313,922 | | | | 5,578,680 | | | 810,571 | | | 2002 | | | 40 yrs. |
| 5735 Old Shakopee Road West | | Bloomington, MN | | | — | | | | 1,263,226 | | | | 2,360,782 | | | | 1,089,640 | | | | 1,264,758 | | | | 3,448,890 | | | | 4,713,648 | | | 447,722 | | | 2002 | | | 40 yrs. |
| 1701 Clint Moore Boulevard | | Boca Raton, FL | | | — | | | | 1,430,884 | | | | 3,043,553 | | | | 1,302,089 | | | | 1,430,937 | | | | 4,345,589 | | | | 5,776,526 | | | 839,133 | | | 1985 | | | 40 yrs. |
| 951 Broken Sound Parkway | | Boca Raton, FL | | | — | | | | 1,426,251 | | | | 6,098,952 | | | | 1,234,056 | | | | 1,426,251 | | | | 7,333,008 | | | | 8,759,259 | | | 2,037,449 | | | 1986 | | | 40 yrs. |
| 777 Yamato Road | | Boca Raton, FL | | | — | | | | 4,101,247 | | | | 16,077,347 | | | | 4,498,115 | | | | 4,501,247 | | | | 20,175,462 | | | | 24,676,709 | | | 5,014,867 | | | 1987 | | | 40 yrs. |
| 1801 Clint Moore Road | | Boca Raton, FL | | | — | | | | 1,065,068 | | | | 4,481,644 | | | | 640,426 | | | | 1,065,068 | | | | 5,122,070 | | | | 6,187,139 | | | 1,249,779 | | | 1986 | | | 40 yrs. |
| 400 Boulder Drive | | Breinigsville, PA | | | * | | | | — | | | | — | | | | 13,376,989 | | | | 2,865,575 | | | | 10,511,414 | | | | 13,376,989 | | | 629,760 | | | 2003 | | | 40 yrs. |
| 860 Nestle Way | | Breinigsville, PA | | | — | | | | 8,118,881 | | | | 18,885,486 | | | | 1,403,042 | | | | 8,118,881 | | | | 20,288,528 | | | | 28,407,408 | | | 671,096 | | | 2004 | | | 40 yrs. |
| 602 Heron Drive | | Bridgeport, NJ | | | — | | | | 524,728 | | | | 2,240,478 | | | | 7,650 | | | | 524,728 | | | | 2,248,128 | | | | 2,772,856 | | | 491,389 | | | 1996 | | | 40 yrs. |
| 245 Executive Drive | | Brookfield, WI | | | — | | | | 577,067 | | | | 5,197,903 | | | | 3,816,157 | | | | 577,067 | | | | 9,014,060 | | | | 9,591,127 | | | 1,549,221 | | | 1984 | | | 40 yrs. |
| 16620-16650 W Bluemound Road | | Brookfield, WI | | | — | | | | 586,665 | | | | 4,289,907 | | | | 828,882 | | | | 586,665 | | | | 5,118,789 | | | | 5,705,454 | | | 984,048 | | | 1999 | | | 40 yrs. |
| 15800 West Bluemound Road | | Brookfield, WI | | | — | | | | 1,289,204 | | | | 8,128,035 | | | | 948,664 | | | | 1,306,811 | | | | 9,059,092 | | | | 10,365,903 | | | 1,391,720 | | | 1994 | | | 40 yrs. |
| 20700 Swenson Drive | | Brookfield, WI | | | 12,858,381 | | | | 830,008 | | | | 12,276,445 | | | | 478,954 | | | | 830,999 | | | | 12,754,408 | | | | 13,585,406 | | | 429,906 | | | 2005 | | | 40 yrs. |
| 20800 Swenson Drive | | Brookfield, WI | | | — | | | | 1,023,466 | | | | 10,729,219 | | | | 418,157 | | | | 1,025,082 | | | | 11,145,759 | | | | 12,170,841 | | | 474,180 | | | 2005 | | | 40 yrs. |
| 20935 Swenson Drive | | Brookfield, WI | | | 5,295,966 | | | | 571,389 | | | | 10,238,547 | | | | 658,028 | | | | 572,158 | | | | 10,895,806 | | | | 11,467,963 | | | 391,207 | | | 2005 | | | 40 yrs. |
| 20975 Swenson Drive | | Brookfield, WI | | | 7,584,291 | | | | 675,422 | | | | 8,910,651 | | | | 602,016 | | | | 678,637 | | | | 9,509,452 | | | | 10,188,089 | | | 398,554 | | | 2005 | | | 40 yrs. |
| 20825 Swenson Drive | | Brookfield, WI | | | — | | | | 644,563 | | | | 3,640,734 | | | | 64,858 | | | | 646,518 | | | | 3,703,639 | | | | 4,350,156 | | | 111,258 | | | 2006 | | | 40 yrs. |
| 1485 W. Commerce Avenue | | Carlisle, PA | | | — | | | | 4,249,868 | | | | 13,886,039 | | | | 173,427 | | | | 4,253,027 | | | | 14,056,308 | | | | 18,309,335 | | | 699,441 | | | 2004 | | | 40 yrs. |
| 3773 Corporate Parkway | | Center Valley, PA | | | — | | | | 738,108 | | | | — | | | | 7,605,349 | | | | 794,874 | | | | 7,548,583 | | | | 8,343,457 | | | 1,666,953 | | | 2001 | | | 40 yrs. |
| 1309 Executive Boulevard | | Cheaspeake, VA | | | — | | | | 926,125 | | | | — | | | | 5,086,632 | | | | 955,374 | | | | 5,057,383 | | | | 6,012,757 | | | 733,464 | | | 2001 | | | 40 yrs. |
| 7 Carnegie Plaza | | Cherry Hill, NJ | | | * | | | | 2,000,000 | | | | 3,493,983 | | | | 3,217,287 | | | | 2,005,475 | | | | 6,705,794 | | | | 8,711,270 | | | 543,140 | | | 2004 | | | 40 yrs. |
| 1305 Executive Boulevard | | Chesapeake, VA | | | — | | | | 861,020 | | | | — | | | | 4,878,062 | | | | 1,129,850 | | | | 4,609,232 | | | | 5,739,082 | | | 691,749 | | | 2002 | | | 40 yrs. |
| 1313 Executive Boulevard | | Chesapeake, VA | | | — | | | | 1,180,036 | | | | — | | | | 4,629,615 | | | | 1,708,050 | | | | 4,101,602 | | | | 5,809,652 | | | 554,643 | | | 2002 | | | 40 yrs. |
| 500 Independence Parkway | | Chesapeake, VA | | | 3,588,914 | | | | 864,150 | | | | 4,427,285 | | | | 66,501 | | | | 866,609 | | | | 4,491,328 | | | | 5,357,937 | | | 352,536 | | | 2004 | | | 40 yrs. |
| 700 Independence Parkway | | Chesapeake, VA | | | 6,903,981 | | | | 1,950,375 | | | | 8,273,910 | | | | (614,501 | ) | | | 1,951,135 | | | | 7,658,648 | | | | 9,609,783 | | | 650,222 | | | 2004 | | | 40 yrs. |
| 501 Independence Parkway | | Chesapeake, VA | | | 4,967,909 | | | | 1,202,556 | | | | 5,975,538 | | | | 1,185,556 | | | | 1,292,273 | | | | 7,071,376 | | | | 8,363,650 | | | 336,396 | | | 2005 | | | 40 yrs. |
| 505 Independence Parkway | | Chesapeake, VA | | | 5,793,893 | | | | 1,292,062 | | | | 6,456,515 | | | | 1,141,115 | | | | 1,292,254 | | | | 7,597,437 | | | | 8,889,691 | | | 380,615 | | | 2005 | | | 40 yrs. |
| 510 Independence Parkway | | Chesapeake, VA | | | — | | | | 2,012,149 | | | | 7,546,882 | | | | 394,344 | | | | 2,014,689 | | | | 7,938,686 | | | | 9,953,375 | | | 422,930 | | | 2005 | | | 40 yrs. |
| 1301 Executive Boulevard | | Chesapeake, VA | | | — | | | | — | | | | — | | | | 6,113,029 | | | | 997,570 | | | | 5,115,459 | | | | 6,113,029 | | | 108,314 | | | 2005 | | | 40 yrs. |
| 600 H P Way | | Chester, VA | | | — | | | | 146,126 | | | | — | | | | 6,429,625 | | | | 501,752 | | | | 6,073,999 | | | | 6,575,751 | | | 1,193,352 | | | 1997 | | | 40 yrs. |
| 500 H P Way | | Chester, VA | | | — | | | | 142,692 | | | | — | | | | 5,563,992 | | | | 491,919 | | | | 5,214,765 | | | | 5,706,684 | | | 1,090,627 | | | 1997 | | | 40 yrs. |
| 6230 Old Dobbin Lane | | Colombia, MD | | | — | | | | 3,004,075 | | | | — | | | | 7,729,322 | | | | 2,746,455 | | | | 7,986,942 | | | | 10,733,397 | | | 161,577 | | | 2004 | | | 40 yrs. |
| 9101,9111,9115 Guilford Road | | Columbia, MD | | | — | | | | 758,951 | | | | — | | | | 3,519,455 | | | | 765,952 | | | | 3,512,453 | | | | 4,278,406 | | | 1,941,815 | | | 1984 | | | 40 yrs. |
| 9125,9135,9145 Guilford Road | | Columbia, MD | | | — | | | | 900,154 | | | | — | | | | 5,815,495 | | | | 920,439 | | | | 5,795,210 | | | | 6,715,649 | | | 3,426,185 | | | 1983 | | | 40 yrs. |
| 7178-80 Columbia Gateway | | Columbia, MD | | | — | | | | 1,569,237 | | �� | | 4,786,887 | | | | 1,836,281 | | | | 1,571,105 | | | | 6,621,299 | | | | 8,192,405 | | | 2,215,458 | | | 1987 | | | 40 yrs. |
| 9770 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 341,663 | | | | 3,033,309 | | | | 907,405 | | | | 341,663 | | | | 3,940,714 | | | | 4,282,377 | | | 791,142 | | | 1986 | | | 40 yrs. |
| 9780 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 218,542 | | | | 1,940,636 | | | | 125,207 | | | | 218,542 | | | | 2,065,843 | | | | 2,284,384 | | | 504,644 | | | 1986 | | | 40 yrs. |
| 9790 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 243,791 | | | | 2,164,094 | | | | 223,402 | | | | 243,791 | | | | 2,387,496 | | | | 2,631,287 | | | 669,572 | | | 1986 | | | 40 yrs. |
| 9810 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 266,684 | | | | 2,366,901 | | | | 644,582 | | | | 266,684 | | | | 3,011,483 | | | | 3,278,167 | | | 794,236 | | | 1986 | | | 40 yrs. |
| 9800 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 299,099 | | | | 2,654,069 | | | | 531,960 | | | | 299,099 | | | | 3,186,029 | | | | 3,485,129 | | | 815,523 | | | 1988 | | | 40 yrs. |
| 9820 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 237,779 | | | | 2,110,835 | | | | 711,722 | | | | 237,779 | | | | 2,822,557 | | | | 3,060,336 | | | 569,893 | | | 1988 | | | 40 yrs. |
| 9830 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 296,262 | | | | 2,628,933 | | | | 143,928 | | | | 296,262 | | | | 2,772,861 | | | | 3,069,124 | | | 717,517 | | | 1986 | | | 40 yrs. |
| 9050 Red Branch Road | | Columbia, MD | | | — | | | | 290,950 | | | | 2,577,153 | | | | 802,675 | | | | 290,950 | | | | 3,379,828 | | | | 3,670,778 | | | 720,137 | | | 1972 | | | 40 yrs. |
| 8945-8975 Guilford Road | | Columbia, MD | | | — | | | | 2,428,795 | | | | 7,493,740 | | | | 873,148 | | | | 2,427,065 | | | | 8,368,619 | | | | 10,795,684 | | | 1,959,626 | | | 1986 | | | 40 yrs. |
| 6250 Old Dobbin Lane | | Columbia, MD | | | — | | | | 958,105 | | | | — | | | | 3,590,872 | | | | 1,295,000 | | | | 3,253,978 | | | | 4,548,978 | | | 602,208 | | | 2002 | | | 40 yrs. |
| 6200 Old Dobbin Lane | | Columbia, MD | | | — | | | | 958,105 | | | | — | | | | 3,736,325 | | | | 1,295,000 | | | | 3,399,431 | | | | 4,694,431 | | | 532,591 | | | 2002 | | | 40 yrs. |
| 6210 Old Dobbin Lane | | Columbia, MD | | | — | | | | 958,105 | | | | — | | | | 3,724,707 | | | | 1,307,300 | | | | 3,375,513 | | | | 4,682,813 | | | 622,557 | | | 2002 | | | 40 yrs. |
| 6250 Old Dobbin Lane | | Columbia, MD | | | — | | | | 958,105 | | | | — | | | | 3,780,749 | | | | 1,599,259 | | | | 3,139,595 | | | | 4,738,854 | | | 349,799 | | | 2000 | | | 40 yrs. |
| 5950 Symphony Woods Road | | Columbia, MD | | | — | | | | 1,462,762 | | | | 11,310,187 | | | | 1,368,440 | | | | 1,467,623 | | | | 12,673,767 | | | | 14,141,389 | | | 1,845,734 | | | 1986 | | | 40 yrs. |
| 9755 Patuxent Woods Drive | | Columbia, MD | | | — | | | | 3,917,094 | | | | 16,219,721 | | | | 110,510 | | | | 3,922,382 | | | | 16,324,943 | | | | 20,247,324 | | | — | | | 2006 | | | 40 yrs. |
| 5150 International Drive | | Cudahy, WI | | | — | | | | 739,673 | | | | 5,108,025 | | | | 250,327 | | | | 741,858 | | | | 5,356,167 | | | | 6,098,024 | | | 420,347 | | | 2003 | | | 40 yrs. |
| 1250 Hall Court | | Deer Park, TX | | | 3,063,690 | | | | 829,570 | | | | 4,778,327 | | | | — | | | | 829,570 | | | | 4,778,327 | | | | 5,607,897 | | | 8,813 | | | 2006 | | | 40 yrs. |
| 170 Parkway West | | Duncan, SC | | | — | | | | 598,348 | | | | 3,643,756 | | | | 68,364 | | | | 598,918 | | | | 3,711,550 | | | | 4,310,468 | | | 86,944 | | | 2006 | | | 40 yrs. |
95
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 190 Parkway West | | Duncan, SC | | | — | | | | 551,663 | | | | 3,463,858 | | | | 34,737 | | | | 552,211 | | | | 3,498,047 | | | | 4,050,258 | | | | 95,141 | | | 2006 | | 40 yrs. |
| 265 Parkway East | | Duncan, SC | | | — | | | | 901,444 | | | | 5,751,389 | | | | 18,391 | | | | 902,374 | | | | 5,768,850 | | | | 6,671,224 | | | | 174,266 | | | 2006 | | 40 yrs. |
| 285 Parkway East | | Duncan, SC | | | — | | | | 975,433 | | | | 6,149,465 | | | | 23,682 | | | | 976,393 | | | | 6,172,187 | | | | 7,148,580 | | | | 313,732 | | | 2006 | | 40 yrs. |
| 3255 Neil Armstrong Boulevard | | Eagan, MN | | | — | | | | 1,131,017 | | | | — | | | | 3,393,423 | | | | 1,131,017 | | | | 3,393,423 | | | | 4,524,441 | | | | 677,048 | | | 1998 | | 40 yrs. |
| 6321-6325 Bury Drive | | Eden Prairie, MN | | | — | | | | 462,876 | | | | 4,151,790 | | | | 317,011 | | | | 462,876 | | | | 4,468,801 | | | | 4,931,677 | | | | 1,213,996 | | | 1988 | | 40 yrs. |
| 7660-7716 Golden Triangle Drive | | Eden Prairie, MN | | | — | | | | 568,706 | | | | 5,115,177 | | | | 2,817,841 | | | | 1,289,215 | | | | 7,212,509 | | | | 8,501,724 | | | | 2,440,957 | | | 1988 | | 40 yrs. |
| 7400 Flying Cloud Drive | | Eden Prairie, MN | | | — | | | | 195,982 | | | | 1,762,027 | | | | 157,281 | | | | 195,982 | | | | 1,919,309 | | | | 2,115,290 | | | | 441,713 | | | 1987 | | 40 yrs. |
| 10301-10305 West 70th Street | | Eden Prairie, MN | | | — | | | | 120,622 | | | | 1,085,226 | | | | 121,763 | | | | 118,300 | | | | 1,209,311 | | | | 1,327,611 | | | | 304,525 | | | 1984 | | 40 yrs. |
| 10321 West 70th Street | | Eden Prairie, MN | | | — | | | | 145,198 | | | | 1,305,700 | | | | 369,479 | | | | 142,399 | | | | 1,677,978 | | | | 1,820,377 | | | | 479,554 | | | 1984 | | 40 yrs. |
| 10333 West 70th Street | | Eden Prairie, MN | | | — | | | | 110,746 | | | | 995,868 | | | | 90,782 | | | | 108,610 | | | | 1,088,786 | | | | 1,197,396 | | | | 257,962 | | | 1984 | | 40 yrs. |
| 10349-10357 West 70th Street | | Eden Prairie, MN | | | — | | | | 275,903 | | | | 2,481,666 | | | | 584,392 | | | | 270,584 | | | | 3,071,377 | | | | 3,341,961 | | | | 737,188 | | | 1985 | | 40 yrs. |
| 10365-10375 West 70th Street | | Eden Prairie, MN | | | — | | | | 291,077 | | | | 2,618,194 | | | | 506,997 | | | | 285,464 | | | | 3,130,804 | | | | 3,416,267 | | | | 756,087 | | | 1985 | | 40 yrs. |
| 10393-10394 West 70th Street | | Eden Prairie, MN | | | — | | | | 269,618 | | | | 2,423,318 | | | | 775,855 | | | | 264,419 | | | | 3,204,372 | | | | 3,468,791 | | | | 761,414 | | | 1985 | | 40 yrs. |
| 7078 Shady Oak Road | | Eden Prairie, MN | | | — | | | | 343,093 | | | | 3,085,795 | | | | 217,201 | | | | 336,481 | | | | 3,309,608 | | | | 3,646,089 | | | | 790,055 | | | 1985 | | 40 yrs. |
| 10400 Viking Drive | | Eden Prairie, MN | | | — | | | | 2,912,391 | | | | — | | | | 22,843,159 | | | | 2,938,372 | | | | 22,817,178 | | | | 25,755,550 | | | | 5,724,688 | | | 1999 | | 40 yrs. |
| 7695-7699 Anagram Drive | | Eden Prairie, MN | | | — | | | | 760,525 | | | | 3,254,758 | | | | 605,146 | | | | 760,525 | | | | 3,859,903 | | | | 4,620,429 | | | | 843,591 | | | 1997 | | 40 yrs. |
| 7800 Equitable Drive | | Eden Prairie, MN | | | — | | | | 2,188,525 | | | | 3,788,762 | | | | 179,519 | | | | 2,188,525 | | | | 3,968,281 | | | | 6,156,806 | | | | 841,929 | | | 1993 | | 40 yrs. |
| 7905 Fuller Road | | Eden Prairie, MN | | | — | | | | 1,229,862 | | | | 4,075,167 | | | | 33,365 | | | | 1,230,965 | | | | 4,107,430 | | | | 5,338,395 | | | | 833,068 | | | 1994 | | 40 yrs. |
| 9023 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,956,273 | | | | — | | | | 4,873,578 | | | | 1,956,273 | | | | 4,873,578 | | | | 6,829,851 | | | | 1,058,231 | | | 1999 | | 40 yrs. |
| 8967 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,450,000 | | | | — | | | | 3,575,107 | | | | 1,450,000 | | | | 3,575,107 | | | | 5,025,107 | | | | 717,864 | | | 2000 | | 40 yrs. |
| 7777 Golden Triangle Drive | | Eden Prairie, MN | | | — | | | | 993,101 | | | | 2,136,862 | | | | 1,191,303 | | | | 993,101 | | | | 3,328,165 | | | | 4,321,266 | | | | 542,633 | | | 2000 | | 40 yrs. |
| 8937 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,325,829 | | | | — | | | | 4,287,274 | | | | 1,739,966 | | | | 3,873,137 | | | | 5,613,103 | | | | 676,755 | | | 2001 | | 40 yrs. |
| 7615 Smetana Lane | | Eden Prairie, MN | | | — | | | | 1,011,517 | | | | — | | | | 8,665,025 | | | | 3,000,555 | | | | 6,675,988 | | | | 9,676,542 | | | | 1,378,155 | | | 2001 | | 40 yrs. |
| 8995 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,087,594 | | | | — | | | | 3,664,053 | | | | 2,055,296 | | | | 2,696,352 | | | | 4,751,648 | | | | 429,638 | | | 2001 | | 40 yrs. |
| 8911 Columbine Road (B2) | | Eden Prairie, MN | | | — | | | | 916,687 | | | | — | | | | 3,608,469 | | | | 1,718,407 | | | | 2,806,748 | | | | 4,525,156 | | | | 377,488 | | | 2000 | | 40 yrs. |
| 8855 Columbine Road | | Eden Prairie, MN | | | — | | | | 1,400,925 | | | | — | | | | 5,226,016 | | | | 1,599,757 | | | | 5,027,185 | | | | 6,626,941 | | | | 325,388 | | | 2000 | | 40 yrs. |
| 27260 Haggerty Road | | Farmington Hills, MI | | | — | | | | 456,877 | | | | 4,091,196 | | | | 754,780 | | | | 456,877 | | | | 4,845,977 | | | | 5,302,854 | | | | 1,273,497 | | | 1983 | | 40 yrs. |
| 27200 Haggerty Road | | Farmington Hills, MI | | | — | | | | 382,754 | | | | 3,425,227 | | | | 363,784 | | | | 382,754 | | | | 3,789,011 | | | | 4,171,765 | | | | 1,043,115 | | | 1983 | | 40 yrs. |
| 27280 Haggerty Road | | Farmington Hills, MI | | | — | | | | 452,860 | | | | 4,055,512 | | | | 443,764 | | | | 452,860 | | | | 4,499,276 | | | | 4,952,136 | | | | 1,150,855 | | | 1983 | | 40 yrs. |
| 27220 Haggerty Road | | Farmington Hills, MI | | | — | | | | 203,064 | | | | 1,802,592 | | | | 174,777 | | | | 203,064 | | | | 1,977,369 | | | | 2,180,433 | | | | 530,662 | | | 1985 | | 40 yrs. |
| 27240 Haggerty Road | | Farmington Hills, MI | | | — | | | | 171,518 | | | | 1,518,192 | | | | 280,526 | | | | 171,518 | | | | 1,798,718 | | | | 1,970,236 | | | | 445,822 | | | 1985 | | 40 yrs. |
| 27300 Haggerty Road | | Farmington Hills, MI | | | — | | | | 370,378 | | | | 3,311,366 | | | | 732,514 | | | | 370,378 | | | | 4,043,880 | | | | 4,414,259 | | | | 967,017 | | | 1985 | | 40 yrs. |
| 26442-26450 Haggerty Road | | Farmington Hills, MI | | | — | | | | 237,687 | | | | 2,143,478 | | | | 152,517 | | | | 237,691 | | | | 2,295,991 | | | | 2,533,682 | | | | 534,548 | | | 1988 | | 40 yrs. |
| 26500 Haggerty Road | | Farmington Hills, MI | | | — | | | | 311,093 | | | | 2,791,804 | | | | 433,388 | | | | 311,097 | | | | 3,225,188 | | | | 3,536,285 | | | | 737,282 | | | 1986 | | 40 yrs. |
| 26650 Haggerty Road | | Farmington Hills, MI | | | — | | | | 173,166 | | | | 1,562,704 | | | | 143,228 | | | | 173,170 | | | | 1,705,928 | | | | 1,879,098 | | | | 378,883 | | | 1988 | | 40 yrs. |
| 26700 Haggerty Road | | Farmington Hills, MI | | | — | | | | 253,338 | | | | 2,290,696 | | | | 104,078 | | | | 253,341 | | | | 2,394,770 | | | | 2,648,112 | | | | 542,406 | | | 1986 | | 40 yrs. |
| 26750 Haggerty Road | | Farmington Hills, MI | | | — | | | | 292,717 | | | | 2,638,688 | | | | 250,110 | | | | 292,720 | | | | 2,888,795 | | | | 3,181,515 | | | | 750,106 | | | 1988 | | 40 yrs. |
| 26800 Haggerty Road | | Farmington Hills, MI | | | — | | | | 175,489 | | | | 1,583,362 | | | | 243,691 | | | | 175,492 | | | | 1,827,050 | | | | 2,002,542 | | | | 500,064 | | | 1986 | | 40 yrs. |
| 26842-26850 Haggerty Road | | Farmington Hills, MI | | | — | | | | 239,606 | | | | 2,160,470 | | | | 364,314 | | | | 239,609 | | | | 2,524,781 | | | | 2,764,390 | | | | 707,486 | | | 1988 | | 40 yrs. |
| 26600 Haggerty Road | | Farmington Hills, MI | | | — | | | | 455,846 | | | | — | | | | 2,921,972 | | | | 537,693 | | | | 2,840,125 | | | | 3,377,818 | | | | 819,672 | | | 1999 | | 40 yrs. |
| 26550 Haggerty Road | | Farmington Hills, MI | | | — | | | | 368,083 | | | | — | | | | 2,647,709 | | | | 535,179 | | | | 2,480,613 | | | | 3,015,792 | | | | 658,542 | | | 2000 | | 40 yrs. |
| 7028 Snowdrift Road | | Fogelville, PA | | | — | | | | 520,473 | | | | 959,279 | | | | 262,203 | | | | 524,390 | | | | 1,217,565 | | | | 1,741,954 | | | | 292,366 | | | 1982 | | 40 yrs. |
| 420 Delaware Drive | | Fort Washington, PA | | | — | | | | 2,766,931 | | | | — | | | | 8,814,580 | | | | 2,823,257 | | | | 8,758,255 | | | | 11,581,511 | | | | 49,754 | | | 2005 | | 40 yrs. |
| 414 Commerce Drive | | Fort Washington, PA | | | — | | | | 1,267,194 | | | | 2,217,460 | | | | 177,437 | | | | 1,267,937 | | | | 2,394,153 | | | | 3,662,091 | | | | 63,339 | | | 2004 | | 40 yrs. |
| 275 Commerce Drive | | Fort Washington, PA | | | — | | | | 1,775,894 | | | | 2,160,855 | | | | 1,870,359 | | | | 1,789,302 | | | | 4,017,806 | | | | 5,807,108 | | | | — | | | 2005 | | 40 yrs. |
| 1250 Virginia Drive | | Fort Washington, PA | | | — | | | | 1,639,166 | | | | 1,928,574 | | | | 422,241 | | | | 1,650,703 | | | | 2,339,278 | | | | 3,989,980 | | | | 23,113 | | | 2005 | | 40 yrs. |
| 1100 Virginia Drive | | Fort Washington, PA | | | — | | | | 13,007,509 | | | | 11,480,744 | | | | 53,906 | | | | 13,035,013 | | | | 11,507,146 | | | | 24,542,159 | | | | 197,270 | | | 2006 | | 40 yrs. |
| 106 Southchase Boulevard | | Fountain Inn, SC | | | — | | | | 201,944 | | | | — | | | | 5,133,389 | | | | 684,003 | | | | 4,651,330 | | | | 5,335,333 | | | | 125,941 | | | 2005 | | 40 yrs. |
| 9601 Cosner Drive | | Fredericksburg, VA | | | — | | | | 475,262 | | | | 3,917,234 | | | | 214,221 | | | | 475,262 | | | | 4,131,454 | | | | 4,606,716 | | | | 1,177,660 | | | 1995 | | 40 yrs. |
| 200 W Cypress Creek Road | | Ft Lauderdale, FL | | | — | | | | 3,414,989 | | | | 2,399,738 | | | | 9,866,832 | | | | 3,414,989 | | | | 12,266,571 | | | | 15,681,559 | | | | 452,897 | | | 2003 | | 40 yrs. |
| 5410 - 5430 Northwest 33rd Avenue | | Ft. Lauderdale, FL | | | — | | | | 603,776 | | | | 4,176,238 | | | | 1,101,013 | | | | 625,111 | | | | 5,255,916 | | | | 5,881,027 | | | | 1,288,523 | | | 1985 | | 40 yrs. |
| 6500 NW 12th Avenue | | Ft. Lauderdale, FL | | | — | | | | 7,099 | | | | 3,046,309 | | | | 438,216 | | | | — | | | | 3,491,624 | | | | 3,491,624 | | | | 884,615 | | | 1989 | | 40 yrs. |
| 6600 NW 12th Avenue | | Ft. Lauderdale, FL | | | — | | | | 7,102 | | | | 3,047,462 | | | | 486,427 | | | | — | | | | 3,540,992 | | | | 3,540,992 | | | | 912,641 | | | 1989 | | 40 yrs. |
| 4880 Cox Road | | Glen Allen, VA | | | — | | | | 743,898 | | | | 4,499,807 | | | | 2,746,479 | | | | 743,898 | | | | 7,246,286 | | | | 7,990,184 | | | | 1,217,434 | | | 1995 | | 40 yrs. |
| 5000 Cox Road | | Glen Allen, VA | | | — | | | | 770,214 | | | | 3,685,248 | | | | 185,433 | | | | 771,029 | | | | 3,869,867 | | | | 4,640,895 | | | | 1,080,246 | | | 1990 | | 40 yrs. |
| 5500 Cox Road | | Glen Allen, VA | | | — | | | | 443,485 | | | | — | | | | 3,347,885 | | | | 483,263 | | | | 3,308,107 | | | | 3,791,370 | | | | 793,756 | | | 1999 | | 40 yrs. |
| 4801 Cox Road | | Glen Allen, VA | | | — | | | | 1,072,896 | | | | — | | | | 10,197,775 | | | | 1,075,620 | | | | 10,195,051 | | | | 11,270,671 | | | | 2,394,924 | | | 1998 | | 40 yrs. |
| 4198 Cox Road | | Glen Allen, VA | | | — | | | | 670,292 | | | | 3,839,245 | | | | 981,346 | | | | 670,292 | | | | 4,820,591 | | | | 5,490,883 | | | | 1,290,221 | | | 1984 | | 40 yrs. |
| 4510 Cox Road | | Glen Allen, VA | | | — | | | | 1,010,024 | | | | 7,151,729 | | | | 1,751,122 | | | | 1,010,044 | | | | 8,902,831 | | | | 9,912,875 | | | | 2,447,991 | | | 1990 | | 40 yrs. |
| 4121 Cox Road | | Glen Allen, VA | | | — | | | | 1,083,006 | | | | 6,035,653 | | | | 519,164 | | | | 1,083,006 | | | | 6,554,817 | | | | 7,637,824 | | | | 436,918 | | | 2004 | | 40 yrs. |
| 420 Park Avenue | | Greenville, SC | | | * | | | | 522,548 | | | | 2,730,261 | | | | 977,573 | | | | 522,548 | | | | 3,707,834 | | | | 4,230,382 | | | | 1,096,196 | | | 1986 | | 40 yrs. |
| One Independence Pointe | | Greenville, SC | | | — | | | | 780,881 | | | | 6,199,230 | | | | 6,430,871 | | | | 784,617 | | | | 12,626,365 | | | | 13,410,982 | | | | 2,240,553 | | | 1982 | | 40 yrs. |
96
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 15 Brendan Way | | Greenville, SC | | | — | | | | 614,192 | | | | 3,012,019 | | | | 1,767,666 | | | | 614,192 | | | | 4,779,684 | | | | 5,393,876 | | | | 1,424,079 | | | 1988 | | 40 yrs. |
| 4 Independence Pointe | | Greenville, SC | | | — | | | | — | | | | — | | | | 3,555,776 | | | | 467,438 | | | | 3,088,339 | | | | 3,555,776 | | | | 587,548 | | | 2002 | | 40 yrs. |
| 5 Independence Pointe | | Greenville, SC | | | — | | | | — | | | | — | | | | 3,286,804 | | | | 467,438 | | | | 2,819,366 | | | | 3,286,804 | | | | 616,674 | | | 2002 | | 40 yrs. |
| 200 Southchase Boulevard | | Greenville, SC | | | — | | | | 512,911 | | | | — | | | | 6,273,615 | | | | 515,542 | | | | 6,270,984 | | | | 6,786,525 | | | | 478,893 | | | 2003 | | 40 yrs. |
| 6 Independence Pointe | | Greenville, SC | | | — | | | | — | | | | — | | | | 3,061,966 | | | | 545,698 | | | | 2,516,268 | | | | 3,061,966 | | | | 195,504 | | | 2003 | | 40 yrs. |
| 2 Independence Point | | Greenville, SC | | | — | | | | 371,600 | | | | — | | | | 3,168,228 | | | | 682,881 | | | | 2,856,946 | | | | 3,539,828 | | | | 30,935 | | | 2005 | | 40 yrs. |
| 1 Enterprise Parkway | | Hampton, VA | | | — | | | | 974,675 | | | | 5,579,869 | | | | 1,182,175 | | | | 974,675 | | | | 6,762,044 | | | | 7,736,719 | | | | 1,737,849 | | | 1987 | | 40 yrs. |
| 22 Enterprise Parkway | | Hampton, VA | | | — | | | | 1,097,368 | | | | 6,760,778 | | | | 856,086 | | | | 1,097,368 | | | | 7,616,864 | | | | 8,714,232 | | | | 2,061,113 | | | 1990 | | 40 yrs. |
| 5 Manhattan Square | | Hampton, VA | | | — | | | | 207,368 | | | | — | | | | 1,663,695 | | | | 212,694 | | | | 1,658,368 | | | | 1,871,063 | | | | 428,848 | | | 1999 | | 40 yrs. |
| 21 Enterprise Parkway | | Hampton, VA | | | 383,605 | | | | 263,668 | | | | 8,167,118 | | | | 511,240 | | | | 265,719 | | | | 8,676,307 | | | | 8,942,026 | | | | 1,386,213 | | | 1999 | | 40 yrs. |
| 521 Butler Farm Road | | Hampton, VA | | | — | | | | 750,769 | | | | 2,911,149 | | | | 260,815 | | | | 710,486 | | | | 3,212,247 | | | | 3,922,733 | | | | 264,018 | | | 2003 | | 40 yrs. |
| 7317 Parkway Drive | | Hanover, MD | | | — | | | | 1,104,359 | | | | 1,959,671 | | | | 79,319 | | | | 1,104,359 | | | | 2,038,990 | | | | 3,143,349 | | | | 453,669 | | | 1983 | | 40 yrs. |
| 500 McCarthy Drive | | Harrisburg, PA | | | — | | | | 5,194,872 | | | | 19,991,436 | | | | 4,120,570 | | | | 5,687,013 | | | | 23,619,865 | | | | 29,306,878 | | | | 1,197,404 | | | 2005 | | 40 yrs. |
| 4170 Mendenhall Oaks Parkway | | High Point , NC | | | — | | | | 143,699 | | | | — | | | | 2,210,943 | | | | 373,502 | | | | 1,981,140 | | | | 2,354,642 | | | | 543,603 | | | 1999 | | 40 yrs. |
| 4180 Mendenhall Oaks Parkway | | High Point , NC | | | — | | | | 121,329 | | | | — | | | | 1,836,257 | | | | 315,614 | | | | 1,641,972 | | | | 1,957,586 | | | | 506,298 | | | 1999 | | 40 yrs. |
| 4050 Piedmont Parkway | | High Point , NC | | | — | | | | 801,902 | | | | — | | | | 19,610,267 | | | | 2,042,159 | | | | 18,370,011 | | | | 20,412,169 | | | | 3,868,705 | | | 1998 | | 40 yrs. |
| 4523 Green Point Drive | | High Point, NC | | | — | | | | 234,564 | | | | — | | | | 2,404,561 | | | | 235,698 | | | | 2,403,427 | | | | 2,639,125 | | | | 1,058,454 | | | 1988 | | 40 yrs. |
| 4501 Green Point Drive | | High Point, NC | | | — | | | | 319,289 | | | | — | | | | 2,630,880 | | | | 320,450 | | | | 2,629,719 | | | | 2,950,169 | | | | 1,156,811 | | | 1989 | | 40 yrs. |
| 4500 Green Point Drive | | High Point, NC | | | — | | | | 230,622 | | | | — | | | | 2,333,337 | | | | 231,692 | | | | 2,332,268 | | | | 2,563,959 | | | | 1,087,232 | | | 1989 | | 40 yrs. |
| 2427 Penny Road | | High Point, NC | | | — | | | | 1,165,664 | | | | — | | | | 3,467,001 | | | | 655,240 | | | | 3,977,424 | | | | 4,632,665 | | | | 1,593,141 | | | 1990 | | 40 yrs. |
| 4524 Green Point Drive | | High Point, NC | | | — | | | | 182,810 | | | | — | | | | 2,364,005 | | | | 183,888 | | | | 2,362,926 | | | | 2,546,815 | | | | 1,039,384 | | | 1989 | | 40 yrs. |
| 4328, 4336 Federal Drive | | High Point, NC | | | 4,545,898 | | | | 521,122 | | | | — | | | | 7,238,387 | | | | 825,092 | | | | 6,934,416 | | | | 7,759,509 | | | | 3,316,305 | | | 1995 | | 40 yrs. |
| 4344 Federal Drive | | High Point, NC | | | — | | | | 484,001 | | | | — | | | | 2,755,206 | | | | 173,623 | | | | 3,065,585 | | | | 3,239,208 | | | | 1,019,455 | | | 1996 | | 40 yrs. |
| 4000 Piedmont Parkway | | High Point, NC | | | — | | | | 592,885 | | | | 4,825,615 | | | | 807,718 | | | | 597,368 | | | | 5,628,850 | | | | 6,226,218 | | | | 1,733,031 | | | 1989 | | 40 yrs. |
| 4380 Federal Drive | | High Point, NC | | | — | | | | 282,996 | | | | — | | | | 2,210,549 | | | | 283,368 | | | | 2,210,177 | | | | 2,493,545 | | | | 727,018 | | | 1997 | | 40 yrs. |
| 4388 Federal Drive | | High Point, NC | | | — | | | | 143,661 | | | | — | | | | 1,225,791 | | | | 132,655 | | | | 1,236,797 | | | | 1,369,452 | | | | 430,335 | | | 1997 | | 40 yrs. |
| 4160 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 285,882 | | | | — | | | | 3,351,586 | | | | 545,627 | | | | 3,091,841 | | | | 3,637,468 | | | | 725,642 | | | 1998 | | 40 yrs. |
| 4194 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 102,372 | | | | — | | | | 2,598,532 | | | | 265,991 | | | | 2,434,913 | | | | 2,700,904 | | | | 647,095 | | | 1999 | | 40 yrs. |
| 4196 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 66,731 | | | | — | | | | 2,250,342 | | | | 173,889 | | | | 2,143,184 | | | | 2,317,073 | | | | 709,040 | | | 1999 | | 40 yrs. |
| 4300 Federal Drive | | High Point, NC | | | — | | | | 264,038 | | | | — | | | | 2,090,460 | | | | 276,038 | | | | 2,078,460 | | | | 2,354,498 | | | | 367,817 | | | 1998 | | 40 yrs. |
| 4135 Mendenall Oaks Parkway | | High Point, NC | | | — | | | | 499,500 | | | | — | | | | 3,052,846 | | | | 500,980 | | | | 3,051,365 | | | | 3,552,346 | | | | 563,934 | | | 2000 | | 40 yrs. |
| 4183 Eagle Hill Drive | | High Point, NC | | | — | | | | 122,203 | | | | — | | | | 3,748,139 | | | | 526,266 | | | | 3,344,076 | | | | 3,870,342 | | | | 1,096,678 | | | 2001 | | 40 yrs. |
| 4189 Eagle Hill Drive | | High Point, NC | | | — | | | | 100,106 | | | | — | | | | 3,430,702 | | | | 431,106 | | | | 3,099,702 | | | | 3,530,808 | | | | 723,686 | | | 2001 | | 40 yrs. |
| 4020 Meeting Way | | High Point, NC | | | — | | | | 94,232 | | | | — | | | | 1,682,699 | | | | 378,101 | | | | 1,398,830 | | | | 1,776,931 | | | | 313,939 | | | 2001 | | 40 yrs. |
| 1400 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 172,320 | | | | — | | | | 7,145,926 | | | | 984,672 | | | | 6,333,574 | | | | 7,318,246 | | | | 1,020,098 | | | 2002 | | 40 yrs. |
| 4191 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | 217,943 | | | | — | | | | 3,119,682 | | | | 611,166 | | | | 2,726,459 | | | | 3,337,625 | | | | 422,224 | | | 2002 | | 40 yrs. |
| 4015 Meeting Way | | High Point, NC | | | — | | | | 510,000 | | | | — | | | | 2,792,495 | | | | 511,869 | | | | 2,790,626 | | | | 3,302,495 | | | | 141,901 | | | 2003 | | 40 yrs. |
| 4195 Eagle Hill Drive | | High Point, NC | | | — | | | | 107,586 | | | | — | | | | 3,349,592 | | | | 505,700 | | | | 2,951,478 | | | | 3,457,178 | | | | 120,322 | | | 2004 | | 40 yrs. |
| 400 Mendenhall Oaks Parkway | | High Point, NC | | | — | | | | — | | | | — | | | | 1,860,213 | | | | 665,239 | | | | 1,194,974 | | | | 1,860,213 | | | | 14,800 | | | 2004 | | 40 yrs. |
| 100 Witmer Road | | Horsham, PA | | | 5,804,315 | | | | 3,102,784 | | | | — | | | | 11,902,626 | | | | 3,764,784 | | | | 11,240,627 | | | | 15,005,410 | | | | 2,877,003 | | | 1996 | | 40 yrs. |
| 132 Welsh Road | | Horsham, PA | | | — | | | | 1,333,642 | | | | — | | | | 4,219,965 | | | | 1,408,041 | | | | 4,145,566 | | | | 5,553,607 | | | | 1,331,664 | | | 1998 | | 40 yrs. |
| 300 Welsh Road — Building 3 | | Horsham, PA | | | — | | | | 180,459 | | | | 1,441,473 | | | | 358,107 | | | | 180,459 | | | | 1,799,579 | | | | 1,980,038 | | | | 566,487 | | | 1983 | | 40 yrs. |
| 300 Welsh Road — Building 4 | | Horsham, PA | | | — | | | | 282,493 | | | | 2,256,508 | | | | 1,347,544 | | | | 282,493 | | | | 3,604,051 | | | | 3,886,545 | | | | 1,094,113 | | | 1983 | | 40 yrs. |
| 2 Walnut Grove Drive | | Horsham, PA | | | — | | | | 1,281,870 | | | | 7,767,374 | | | | 1,614,038 | | | | 1,265,363 | | | | 9,397,919 | | | | 10,663,282 | | | | 2,775,835 | | | 1989 | | 40 yrs. |
| 5 Walnut Grove Drive | | Horsham, PA | | | — | | | | 1,065,951 | | | | — | | | | 9,658,857 | | | | 1,939,712 | | | | 8,785,096 | | | | 10,724,809 | | | | 1,749,887 | | | 2000 | | 40 yrs. |
| 200 Gibraltar Road | | Horsham, PA | | | — | | | | 638,513 | | | | 5,811,323 | | | | 1,627,733 | | | | 638,513 | | | | 7,439,056 | | | | 8,077,569 | | | | 2,202,723 | | | 1990 | | 40 yrs. |
| 220 Gibraltar Road | | Horsham, PA | | | — | | | | 629,944 | | | | 5,733,228 | | | | 1,201,778 | | | | 629,944 | | | | 6,935,006 | | | | 7,564,950 | | | | 2,143,096 | | | 1990 | | 40 yrs. |
| 240 Gibraltar Road | | Horsham, PA | | | — | | | | 629,944 | | | | 5,733,234 | | | | 1,578,115 | | | | 629,944 | | | | 7,311,349 | | | | 7,941,293 | | | | 2,295,152 | | | 1990 | | 40 yrs. |
| 1 Walnut Grove Drive | | Horsham, PA | | | — | | | | 1,058,901 | | | | 5,343,606 | | | | 1,041,557 | | | | 1,058,901 | | | | 6,385,163 | �� | | | 7,444,064 | | | | 2,059,580 | | | 1986 | | 40 yrs. |
| 181-187 Gibraltar Road | | Horsham, PA | | | — | | | | 360,549 | | | | 3,259,984 | | | | 506,596 | | | | 360,549 | | | | 3,766,580 | | | | 4,127,129 | | | | 1,094,203 | | | 1982 | | 40 yrs. |
| 104 Rock Road | | Horsham, PA | | | — | | | | 330,111 | | | | 2,981,669 | | | | 233,299 | | | | 330,111 | | | | 3,214,968 | | | | 3,545,079 | | | | 705,425 | | | 1974 | | 40 yrs. |
| 123-135 Rock Road | | Horsham, PA | | | — | | | | 292,360 | | | | 2,411,677 | | | | 871,555 | | | | 393,019 | | | | 3,182,573 | | | | 3,575,591 | | | | 970,834 | | | 1975 | | 40 yrs. |
| 111-159 Gibraltar Road | | Horsham, PA | | | — | | | | 489,032 | | | | 4,126,151 | | | | 613,296 | | | | 489,032 | | | | 4,739,447 | | | | 5,228,479 | | | | 1,272,980 | | | 1981 | | 40 yrs. |
| 161-175 Gibraltar Road | | Horsham, PA | | | — | | | | 294,673 | | | | 2,663,722 | | | | 987,299 | | | | 294,673 | | | | 3,651,020 | | | | 3,945,694 | | | | 856,934 | | | 1976 | | 40 yrs. |
| 103-109 Gibraltar Road | | Horsham, PA | | | — | | | | 270,906 | | | | 2,448,500 | | | | 795,126 | | | | 270,906 | | | | 3,243,625 | | | | 3,514,531 | | | | 1,044,383 | | | 1978 | | 40 yrs. |
| 261-283 Gibraltar Road | | Horsham, PA | | | * | | | | 464,871 | | | | 3,951,972 | | | | 141,841 | | | | 464,871 | | | | 4,093,813 | | | | 4,558,684 | | | | 942,660 | | | 1978 | | 40 yrs. |
| 210-223 Witmer Road | | Horsham, PA | | | — | | | | 270,282 | | | | 2,441,276 | | | | 1,761,333 | | | | 270,282 | | | | 4,202,609 | | | | 4,472,891 | | | | 959,764 | | | 1972 | | 40 yrs. |
| 231-237 Gibraltar Road | | Horsham, PA | | | * | | | | 436,952 | | | | 3,948,963 | | | | 699,674 | | | | 436,952 | | | | 4,648,636 | | | | 5,085,589 | | | | 1,155,695 | | | 1981 | | 40 yrs. |
| 100 Gibraltar Road | | Horsham, PA | | | — | | | | 38,729 | | | | 349,811 | | | | 9,589 | | | | 38,729 | | | | 359,400 | | | | 398,129 | | | | 81,406 | | | 1975 | | 40 yrs. |
| 101 Gibraltar Road | | Horsham, PA | | | — | | | | 651,990 | | | | 5,888,989 | | | | 1,376,885 | | | | 732,552 | | | | 7,185,312 | | | | 7,917,864 | | | | 1,741,900 | | | 1977 | | 40 yrs. |
| 506 Prudential Road | | Horsham, PA | | | — | | | | 208,140 | | | | 895,470 | | | | 652,633 | | | | 208,140 | | | | 1,548,102 | | | | 1,756,243 | | | | 357,080 | | | 1973 | | 40 yrs. |
| 113-123 Rock Road | | Horsham, PA | | | — | | | | 351,072 | | | | 3,171,001 | | | | 334,495 | | | | 451,731 | | | | 3,404,836 | | | | 3,856,568 | | | | 823,288 | | | 1975 | | 40 yrs. |
| 101-111 Rock Road | | Horsham, PA | | | — | | | | 350,561 | | | | 3,166,389 | | | | 640,212 | | | | 452,251 | | | | 3,704,911 | | | | 4,157,162 | | | | 892,449 | | | 1975 | | 40 yrs. |
97
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 120 Gibraltar Road | | Horsham, PA | | | — | | | | 533,142 | | | | 4,830,515 | | | | 973,788 | | | | 558,142 | | | | 5,779,303 | | | | 6,337,445 | | | | 1,392,610 | | | 1980 | | 40 yrs. |
| 110 Gibraltar Road | | Horsham, PA | | | — | | | | 673,041 | | | | 5,776,369 | | | | 2,170,108 | | | | 673,041 | | | | 7,946,477 | | | | 8,619,518 | | | | 1,938,777 | | | 1979 | | 40 yrs. |
| 100-107 Lakeside Drive | | Horsham, PA | | | — | | | | 239,528 | | | | 2,163,498 | | | | 659,861 | | | | 255,528 | | | | 2,807,359 | | | | 3,062,887 | | | | 844,384 | | | 1982 | | 40 yrs. |
| 200-264 Lakeside Drive | | Horsham, PA | | | — | | | | 502,705 | | | | 4,540,597 | | | | 915,265 | | | | 502,705 | | | | 5,455,862 | | | | 5,958,567 | | | | 1,609,702 | | | 1982 | | 40 yrs. |
| 300-309 Lakeside Drive | | Horsham, PA | | | — | | | | 369,475 | | | | 3,338,761 | | | | 1,710,844 | | | | 376,475 | | | | 5,042,605 | | | | 5,419,080 | | | | 1,681,475 | | | 1982 | | 40 yrs. |
| 400-445 Lakeside Drive | | Horsham, PA | | | — | | | | 543,628 | | | | 4,910,226 | | | | 2,760,384 | | | | 583,628 | | | | 7,630,610 | | | | 8,214,238 | | | | 2,059,164 | | | 1981 | | 40 yrs. |
| 104 Witmer Road | | Horsham, PA | | | * | | | | 1,248,148 | | | | — | | | | 1,133,479 | | | | 189,793 | | | | 2,191,834 | | | | 2,381,627 | | | | 735,818 | | | 1975 | | 40 yrs. |
| 201 Gibraltar Road | | Horsham, PA | | | — | | | | 380,127 | | | | 3,433,433 | | | | 1,997,494 | | | | 380,802 | | | | 5,430,252 | | | | 5,811,054 | | | | 1,285,924 | | | 1983 | | 40 yrs. |
| 719 Dresher Road | | Horsham, PA | | | * | | | | 493,426 | | | | 2,812,067 | | | | 205,125 | | | | 495,112 | | | | 3,015,506 | | | | 3,510,618 | | | | 669,434 | | | 1987 | | 40 yrs. |
| 4 Walnut Grove | | Horsham, PA | | | * | | | | 2,515,115 | | | | — | | | | 7,329,299 | | | | 2,515,115 | | | | 7,329,299 | | | | 9,844,415 | | | | 1,405,252 | | | 1999 | | 40 yrs. |
| 300 Welsh Road | | Horsham, PA | | | — | | | | 696,061 | | | | 3,339,991 | | | | 547,772 | | | | 696,061 | | | | 3,887,762 | | | | 4,583,823 | | | | 866,821 | | | 1985 | | 40 yrs. |
| 700 Dresher Road | | Horsham, PA | | | — | | | | 2,551,777 | | | | 3,020,638 | | | | 4,641,908 | | | | 2,565,140 | | | | 7,649,183 | | | | 10,214,323 | | | | 3,175,714 | | | 1987 | | 40 yrs. |
| 680 Blair Mill Road | | Horsham, PA | | | — | | | | 3,527,151 | | | | — | | | | 12,039,009 | | | | 4,138,577 | | | | 11,427,583 | | | | 15,566,160 | | | | 2,583,511 | | | 2001 | | 40 yrs. |
| 102 Rock Road | | Horsham, PA | | | — | | | | 1,110,209 | | | | 2,301,302 | | | | 1,133,191 | | | | 1,114,985 | | | | 3,429,717 | | | | 4,544,702 | | | | 474,800 | | | 1985 | | 40 yrs. |
| 335 Commerce Drive | | Horsham, PA | | | — | | | | — | | | | — | | | | 8,736,456 | | | | 182,400 | | | | 8,554,056 | | | | 8,736,456 | | | | 470,505 | | | 2002 | | 40 yrs. |
| 255 Business Center Drive | | Horsham, PA | | | — | | | | 1,086,356 | | | | 2,007,214 | | | | 496,797 | | | | 1,078,769 | | | | 2,511,597 | | | | 3,590,366 | | | | 206,020 | | | 2003 | | 40 yrs. |
| 355 Business Center Drive | | Horsham, PA | | | — | | | | 483,045 | | | | 898,798 | | | | 275,266 | | | | 479,200 | | | | 1,177,910 | | | | 1,657,110 | | | | 129,780 | | | 2003 | | 40 yrs. |
| 455 Business Center Drive | | Horsham, PA | | | — | | | | 1,351,011 | | | | 2,503,449 | | | | 1,668,600 | | | | 1,343,370 | | | | 4,179,690 | | | | 5,523,060 | | | | 548,149 | | | 2003 | | 40 yrs. |
| 555 Business Center Drive | | Horsham, PA | | | — | | | | 727,420 | | | | 1,353,650 | | | | 213,228 | | | | 723,016 | | | | 1,571,283 | | | | 2,294,299 | | | | 212,922 | | | 2003 | | 40 yrs. |
| 747 Dresher Road | | Horsham, PA | | | — | | | | 1,607,238 | | | | — | | | | 4,935,054 | | | | 1,607,977 | | | | 4,934,315 | | | | 6,542,292 | | | | 2,185,045 | | | 1988 | | 40 yrs. |
| 507 Prudential Road | | Horsham, PA | | | 6,268,630 | | | | 644,900 | | | | 5,804,100 | | | | 8,784,448 | | | | 1,131,380 | | | | 14,102,068 | | | | 15,233,448 | | | | 3,726,697 | | | 1988 | | 40 yrs. |
| 767 Electronic Drive | | Horsham, PA | | | * | | | | 1,229,685 | | | | — | | | | 3,319,209 | | | | 1,241,970 | | | | 3,306,924 | | | | 4,548,893 | | | | 1,461,410 | | | 1996 | | 40 yrs. |
| 16445 Air Center Boulevard | | Houston, TX | | | — | | | | 363,339 | | | | 2,509,186 | | | | 545,867 | | | | 363,339 | | | | 3,055,053 | | | | 3,418,392 | | | | 940,458 | | | 1997 | | 40 yrs. |
| 16405 Air Center Boulevard | | Houston, TX | | | — | | | | 438,853 | | | | 3,030,396 | | | | 404,912 | | | | 438,853 | | | | 3,435,307 | | | | 3,874,160 | | | | 822,102 | | | 1997 | | 40 yrs. |
| 16580 Air Center Boulevard | | Houston, TX | | | — | | | | 289,000 | | | | 3,559,857 | | | | 265,899 | | | | 289,000 | | | | 3,825,756 | | | | 4,114,756 | | | | 834,181 | | | 1997 | | 40 yrs. |
| 1755 Trans Central Drive | | Houston, TX | | | — | | | | 293,534 | | | | 3,036,269 | | | | 190,651 | | | | 306,147 | | | | 3,214,306 | | | | 3,520,453 | | | | 579,451 | | | 1999 | | 40 yrs. |
| 16605 Air Center Boulevard | | Houston, TX | | | — | | | | 298,999 | | | | — | | | | 3,770,315 | | | | 496,186 | | | | 3,573,128 | | | | 4,069,314 | | | | 790,837 | | | 2002 | | 40 yrs. |
| 10739 West Little York Road | | Houston, TX | | | — | | | | 797,931 | | | | 5,950,894 | | | | 242,625 | | | | 799,560 | | | | 6,191,890 | | | | 6,991,450 | | | | 803,207 | | | 1999 | | 40 yrs. |
| 10735 West Little York Road | | Houston, TX | | | — | | | | 1,110,988 | | | | 6,351,946 | | | | 1,657,286 | | | | 1,135,483 | | | | 7,984,738 | | | | 9,120,220 | | | | 712,611 | | | 2000 | | 40 yrs. |
| 8801-19 & 8821-49 Fallbrook Drive | | Houston, TX | | | — | | | | 2,290,001 | | | | 15,297,141 | | | | 1,535,943 | | | | 2,290,002 | | | | 16,833,084 | | | | 19,123,085 | | | | 1,587,024 | | | 2000 | | 40 yrs. |
| 16685 Air Center Boulevard | | Houston, TX | | | — | | | | — | | | | — | | | | 2,935,268 | | | | 414,691 | | | | 2,520,577 | | | | 2,935,268 | | | | 184,042 | | | 2004 | | 40 yrs. |
| 8825-8839 N Sam Houston Pkwy | | Houston, TX | | | — | | | | 638,453 | | | | 3,258,815 | | | | 567,574 | | | | 638,477 | | | | 3,826,364 | | | | 4,464,842 | | | | 194,007 | | | 2004 | | 40 yrs. |
| 8850-8872 Fallbrook Drive | | Houston, TX | | | — | | | | 504,317 | | | | 2,878,351 | | | | 1,014,679 | | | | 504,341 | | | | 3,893,006 | | | | 4,397,347 | | | | 227,912 | | | 2004 | | 40 yrs. |
| 8802-8824 Fallbrook Drive | | Houston, TX | | | — | | | | 1,114,406 | | | | 6,364,767 | | | | 663,613 | | | | 1,114,433 | | | | 7,028,353 | | | | 8,142,786 | | | | 542,346 | | | 2004 | | 40 yrs. |
| 16602 Central Green Boulevard | | Houston, TX | | | — | | | | 284,403 | | | | — | | | | 4,496,262 | | | | 503,779 | | | | 4,276,886 | | | | 4,780,665 | | | | 149,476 | | | 2005 | | 40 yrs. |
| 20 Wright Avenue | | Hunt Valley, MD | | | — | | | | 1,205,946 | | | | — | | | | 9,669,027 | | | | 1,861,025 | | | | 9,013,948 | | | | 10,874,973 | | | | 1,351,645 | | | 2001 | | 40 yrs. |
| 4 North Park Drive | | Hunt Valley, MD | | | — | | | | 3,269,948 | | | | 13,551,370 | | | | 993,133 | | | | 3,269,948 | | | | 14,544,504 | | | | 17,814,451 | | | | 1,298,941 | | | 2003 | | 40 yrs. |
| 6 North Park Drive | | Hunt Valley, MD | | | — | | | | 2,077,949 | | | | 8,770,566 | | | | 1,109,669 | | | | 2,077,949 | | | | 9,880,235 | | | | 11,958,184 | | | | 976,602 | | | 2003 | | 40 yrs. |
| 10 North Park Drive | | Hunt Valley, MD | | | — | | | | 2,211,969 | | | | 7,816,042 | | | | 210,820 | | | | 2,211,969 | | | | 8,026,862 | | | | 10,238,831 | | | | 625,778 | | | 2003 | | 40 yrs. |
| 307 International Circle | | Hunt Valley, MD | | | — | | | | 3,538,319 | | | | 14,190,832 | | | | 11,315,040 | | | | 3,542,881 | | | | 25,501,310 | | | | 29,044,191 | | | | 735,562 | | | 2004 | | 40 yrs. |
| 309 International Circle | | Hunt Valley, MD | | | — | | | | 613,667 | | | | 2,458,204 | | | | 648,156 | | | | 615,096 | | | | 3,104,930 | | | | 3,720,026 | | | | 120,826 | | | 2004 | | 40 yrs. |
| 311 International Circle | | Hunt Valley, MD | | | — | | | | 313,365 | | | | 1,281,093 | | | | 69,591 | | | | 314,572 | | | | 1,349,478 | | | | 1,664,050 | | | | 35,808 | | | 2004 | | 40 yrs. |
| 8775 Baypine Road | | Jacksonville, FL | | | — | | | | 906,804 | | | | — | | | | 3,352,809 | | | | 913,013 | | | | 3,346,599 | | | | 4,259,613 | | | | 1,490,769 | | | 1989 | | 40 yrs. |
| 6255 Lake Gray Boulevard | | Jacksonville, FL | | | — | | | | 813,067 | | | | — | | | | 3,960,328 | | | | 812,634 | | | | 3,960,761 | | | | 4,773,395 | | | | 2,061,279 | | | 1987 | | 40 yrs. |
| 8665,8667,8669 Baypine Road | | Jacksonville, FL | | | — | | | | 966,552 | | | | — | | | | 5,892,549 | | | | 974,959 | | | | 5,884,142 | | | | 6,859,101 | | | | 2,590,822 | | | 1987 | | 40 yrs. |
| 7970 Bayberry Road | | Jacksonville, FL | | | — | | | | 127,520 | | | | — | | | | 1,369,921 | | | | 129,979 | | | | 1,367,462 | | | | 1,497,441 | | | | 1,018,453 | | | 1978 | | 40 yrs. |
| 7077 Bonneval Road | | Jacksonville, FL | | | — | | | | 768,000 | | | | 5,789,000 | | | | 3,066,996 | | | | 774,020 | | | | 8,849,976 | | | | 9,623,996 | | | | 3,280,922 | | | 1988 | | 40 yrs. |
| 4190 Belfort Road | | Jacksonville, FL | | | — | | | | 821,000 | | | | 5,866,000 | | | | 3,229,138 | | | | 827,420 | | | | 9,088,718 | | | | 9,916,138 | | | | 3,843,929 | | | 1986 | | 40 yrs. |
| 7020 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 398,257 | | | | — | | | | 2,780,426 | | | | 749,811 | | | | 2,428,873 | | | | 3,178,683 | | | | 1,020,424 | | | 1996 | | 40 yrs. |
| 7022 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 706,934 | | | | — | | | | 3,593,671 | | | | 853,981 | | | | 3,446,624 | | | | 4,300,605 | | | | 1,319,301 | | | 1996 | | 40 yrs. |
| 11777 Central Highway | | Jacksonville, FL | | | — | | | | 92,207 | | | | 429,997 | | | | 1,275,050 | | | | 140,426 | | | | 1,656,828 | | | | 1,797,254 | | | | 1,012,104 | | | 1985 | | 40 yrs. |
| 4345 Southpoint Parkway | | Jacksonville, FL | | | — | | | | — | | | | — | | | | 8,791,159 | | | | 418,093 | | | | 8,373,065 | | | | 8,791,159 | | | | 2,354,624 | | | 1998 | | 40 yrs. |
| 7016 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 597,181 | | | | — | | | | 2,377,385 | | | | 602,633 | | | | 2,371,934 | | | | 2,974,566 | | | | 1,042,593 | | | 1996 | | 40 yrs. |
| 7018 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 840,996 | | | | — | | | | 4,643,140 | | | | 846,461 | | | | 4,637,675 | | | | 5,484,136 | | | | 1,887,918 | | | 1997 | | 40 yrs. |
| 7014 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 574,198 | | | | — | | | | 3,633,593 | | | | 780,486 | | | | 3,427,305 | | | | 4,207,791 | | | | 1,137,784 | | | 1999 | | 40 yrs. |
| 6620 Southpoint Drive | | Jacksonville, FL | | | — | | | | 614,602 | | | | 4,267,477 | | | | 984,847 | | | | 614,602 | | | | 5,252,323 | | | | 5,866,926 | | | | 1,528,012 | | | 1984 | | 40 yrs. |
| 7980 Bayberry Road | | Jacksonville, FL | | | — | | | | 330,726 | | | | 1,338,101 | | | | 32,776 | | | | 330,726 | | | | 1,370,877 | | | | 1,701,603 | | | | 333,506 | | | 1978 | | 40 yrs. |
| 6600 Southpoint Parkway | | Jacksonville, FL | | | — | | | | 998,432 | | | | 4,055,727 | | | | 851,752 | | | | 1,002,704 | | | | 4,903,207 | | | | 5,905,911 | | | | 1,442,391 | | | 1986 | | 40 yrs. |
| 6700 Southpoint Parkway | | Jacksonville, FL | | | — | | | | 620,719 | | | | 2,989,746 | | | | 750,311 | | | | 624,215 | | | | 3,736,561 | | | | 4,360,776 | | | | 1,326,619 | | | 1987 | | 40 yrs. |
| 4801 Executive Park Court - 100 | | Jacksonville, FL | | | — | | | | 554,993 | | | | 2,993,277 | | | | 1,312,090 | | | | 554,542 | | | | 4,305,817 | | | | 4,860,360 | | | | 1,335,378 | | | 1990 | | 40 yrs. |
| 4801 Executive Park Court - 200 | | Jacksonville, FL | | | — | | | | 370,017 | | | | 1,995,518 | | | | 348,996 | | | | 370,039 | | | | 2,344,492 | | | | 2,714,531 | | | | 575,497 | | | 1990 | | 40 yrs. |
| 4810 Executive Park Court | | Jacksonville, FL | | | — | | | | 369,694 | | | | 3,045,639 | | | | 370,039 | | | | 941,958 | | | | 3,987,251 | | | | 4,357,291 | | | | 884,986 | | | 1990 | | 40 yrs. |
| 6602 Executive Park Court - 100 | | Jacksonville, FL | | | — | | | | 388,519 | | | | 2,095,293 | | | | 297,873 | | | | 388,541 | | | | 2,393,144 | | | | 2,781,685 | | | | 624,753 | | | 1993 | | 40 yrs. |
98
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 6602 Executive Park Court - 200 | | Jacksonville, FL | | | — | | | | 296,014 | | | | 1,596,347 | | | | 449,559 | | | | 296,032 | | | | 2,045,888 | | | | 2,341,920 | | | | 515,311 | | | 1993 | | 40 yrs. |
| 6631 Executive Park Court - 100 | | Jacksonville, FL | | | — | | | | 251,613 | | | | 1,356,849 | | | | 482,785 | | | | 251,627 | | | | 1,839,620 | | | | 2,091,247 | | | | 609,302 | | | 1994 | | 40 yrs. |
| 6631 Executive Park Court - 200 | | Jacksonville, FL | | | — | | | | 406,561 | | | | 2,195,070 | | | | 221,980 | | | | 407,043 | | | | 2,416,568 | | | | 2,823,611 | | | | 677,090 | | | 1994 | | 40 yrs. |
| 4815 Executive Park Court - 100 | | Jacksonville, FL | | | — | | | | 366,317 | | | | 1,975,393 | | | | 340,258 | | | | 366,339 | | | | 2,315,629 | | | | 2,681,968 | | | | 712,134 | | | 1995 | | 40 yrs. |
| 4815 Executive Park Court - 200 | | Jacksonville, FL | | | — | | | | 462,522 | | | | 2,494,397 | | | | 459,048 | | | | 462,549 | | | | 2,953,418 | | | | 3,415,967 | | | | 852,379 | | | 1995 | | 40 yrs. |
| 4825 Executive Park Court | | Jacksonville, FL | | | — | | | | 601,278 | | | | 3,242,491 | | | | 282,810 | | | | 601,401 | | | | 3,525,178 | | | | 4,126,579 | | | | 959,847 | | | 1996 | | 40 yrs. |
| 4820 Executive Park Court | | Jacksonville, FL | | | — | | | | 555,173 | | | | 2,693,130 | | | | 768,348 | | | | 555,213 | | | | 3,461,439 | | | | 4,016,651 | | | | 909,913 | | | 1997 | | 40 yrs. |
| 6601 Executive Park Circle North | | Jacksonville, FL | | | — | | | | 551,250 | | | | 3,128,361 | | | | 640 | | | | 551,250 | | | | 3,129,001 | | | | 3,680,251 | | | | 703,615 | | | 1992 | | 40 yrs. |
| 4901 Belfort Road | | Jacksonville, FL | | | — | | | | 877,964 | | | | 2,360,742 | | | | 1,966,868 | | | | 877,964 | | | | 4,327,610 | | | | 5,205,574 | | | | 1,599,696 | | | 1986 | | 40 yrs. |
| 4899 Belfort Road | | Jacksonville, FL | | | — | | | | 1,299,201 | | | | — | | | | 8,179,240 | | | | 1,207,751 | | | | 8,270,690 | | | | 9,478,441 | | | | 1,787,670 | | | 2000 | | 40 yrs. |
| 4905 Belfort Street | | Jacksonville, FL | | | — | | | | 638,154 | | | | — | | | | 3,461,206 | | | | 641,272 | | | | 3,458,088 | | | | 4,099,360 | | | | 880,635 | | | 2000 | | 40 yrs. |
| 7251 Salisbury Road | | Jacksonville, FL | | | — | | | | — | | | | — | | | | 3,567,820 | | | | 662,559 | | | | 2,905,261 | | | | 3,567,820 | | | | 747,221 | | | 2000 | | 40 yrs. |
| 10245 Centurion Parkway North | | Jacksonville, FL | | | — | | | | 852,644 | | | | 3,510,889 | | | | 968,204 | | | | 853,704 | | | | 4,478,033 | | | | 5,331,737 | | | | 1,002,121 | | | 1996 | | 40 yrs. |
| 4887 Belfort Road | | Jacksonville, FL | | | — | | | | 1,299,202 | | | | — | | | | 7,890,278 | | | | 1,665,915 | | | | 7,523,565 | | | | 9,189,480 | | | | 1,444,468 | | | 2002 | | 40 yrs. |
| 7255 Salisbury Road | | Jacksonville, FL | | | — | | | | 392,060 | | | | — | | | | 2,982,347 | | | | 680,766 | | | | 2,693,641 | | | | 3,374,407 | | | | 481,925 | | | 2002 | | 40 yrs. |
| 5201 Gate Parkway | | Jacksonville, FL | | | — | | | | 3,836,532 | | | | — | | | | 21,192,513 | | | | 4,269,346 | | | | 20,759,699 | | | | 25,029,045 | | | | 446,736 | | | 2005 | | 40 yrs. |
| 3200 Horizon Drive | | King of Prussia, PA | | | — | | | | 928,637 | | | | — | | | | 7,053,358 | | | | 1,210,137 | | | | 6,771,857 | | | | 7,981,995 | | | | 2,424,253 | | | 1996 | | 40 yrs. |
| 440 East Swedesford Road | | King of Prussia, PA | | | — | | | | 717,001 | | | | 4,816,121 | | | | 2,684,214 | | | | 717,001 | | | | 7,500,335 | | | | 8,217,336 | | | | 2,723,279 | | | 1988 | | 40 yrs. |
| 460 East Swedesford Road | | King of Prussia, PA | | | — | | | | 705,317 | | | | 4,737,487 | | | | 3,799,506 | | | | 705,317 | | | | 8,536,993 | | | | 9,242,310 | | | | 1,888,272 | | | 1988 | | 40 yrs. |
| 151 South Warner Road | | King of Prussia, PA | | | — | | | | 1,218,086 | | | | 6,937,866 | | | | 360,761 | | | | 1,186,972 | | | | 7,329,741 | | | | 8,516,713 | | | | 1,860,186 | | | 1980 | | 40 yrs. |
| 3604 Horizon Drive | | King of Prussia, PA | | | — | | | | 397,178 | | | | — | | | | 1,628,512 | | | | 350,874 | | | | 1,674,816 | | | | 2,025,690 | | | | 688,143 | | | 1998 | | 40 yrs. |
| 3606 Horizon Drive | | King of Prussia, PA | | | — | | | | 789,409 | | | | — | | | | 1,947,590 | | | | 815,855 | | | | 1,921,144 | | | | 2,736,999 | | | | 771,104 | | | 1997 | | 40 yrs. |
| 650 Swedesford Road | | King of Prussia, PA | | | — | | | | 952,911 | | | | 6,722,830 | | | | 9,647,843 | | | | 952,911 1 | | | | 6,370,672 | | | | 17,323,583 | | | | 5,840,247 | | | 1971 | | 40 yrs. |
| 680 Swedesford Road | | King of Prussia, PA | | | — | | | | 952,361 | | | | 6,722,830 | | | | 8,367,206 | | | | 952,361 1 | | | | 5,090,036 | | | | 16,042,397 | | | | 5,693,790 | | | 1971 | | 40 yrs. |
| 3600 Horizon Drive | | King of Prussia, PA | | | — | | | | 236,432 | | | | 1,856,252 | | | | 610,135 | | | | 236,432 | | | | 2,466,387 | | | | 2,702,818 | | | | 487,948 | | | 1989 | | 40 yrs. |
| 3602 Horizon Drive | | King of Prussia, PA | | | — | | | | 217,734 | | | | 1,759,489 | | | | 338,288 | | | | 217,809 | | | | 2,097,701 | | | | 2,315,510 | | | | 545,130 | | | 1989 | | 40 yrs. |
| 2700 Horizon Drive | | King of Prussia, PA | | | — | | | | 764,370 | | | | — | | | | 3,682,257 | | | | 867,815 | | | | 3,578,812 | | | | 4,446,627 | | | | 1,125,765 | | | 1998 | | 40 yrs. |
| 2900 Horizon Drive | | King of Prussia, PA | | | — | | | | 679,440 | | | | — | | | | 3,503,074 | | | | 774,096 | | | | 3,408,418 | | | | 4,182,514 | | | | 910,904 | | | 1998 | | 40 yrs. |
| 2500 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 509,580 | | | | — | | | | 2,786,056 | | | | 592,886 | | | | 2,702,749 | | | | 3,295,636 | | | | 904,721 | | | 1999 | | 40 yrs. |
| 2300 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 509,580 | | | | — | | | | 3,038,151 | | | | 574,152 | | | | 2,973,578 | | | | 3,547,731 | | | | 764,372 | | | 1999 | | 40 yrs. |
| 2100 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 1,110,111 | | | | — | | | | 9,382,851 | | | | 1,132,519 | | | | 9,360,443 | | | | 10,492,962 | | | | 2,601,425 | | | 1999 | | 40 yrs. |
| 3400 Horizon Drive | | King of Prussia, PA | | | — | | | | 776,496 | | | | 3,139,068 | | | | 976,974 | | | | 776,496 | | | | 4,116,042 | | | | 4,892,538 | | | | 1,110,392 | | | 1995 | | 40 yrs. |
| 2301 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 1,645,246 | | | | — | | | | 30,063,879 | | | | 4,581,649 | | | | 27,127,475 | | | | 31,709,124 | | | | 4,096,749 | | | 2002 | | 40 yrs. |
| 2520 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | 1,020,000 | | | | — | | | | 5,005,045 | | | | 978,402 | | | | 5,046,643 | | | | 6,025,045 | | | | 1,852,202 | | | 1999 | | 40 yrs. |
| 2201 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | — | | | | — | | | | 15,548,161 | | | | 2,413,514 | | | | 13,134,647 | | | | 15,548,161 | | | | 3,185,717 | | | 2000 | | 40 yrs. |
| 2540 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | — | | | | — | | | | 1,625,497 | | | | 274,341 | | | | 1,351,156 | | | | 1,625,497 | | | | 346,016 | | | 2000 | | 40 yrs. |
| 2560 Renaissance Boulevard | | King of Prussia, PA | | | — | | | | — | | | | — | | | | 3,729,254 | | | | 649,792 | | | | 3,079,462 | | | | 3,729,254 | | | | 758,039 | | | 2000 | | 40 yrs. |
| 170 South Warner Road | | King of Prussia, PA | | | — | | | | 547,800 | | | | 3,137,400 | | | | 3,783,307 | | | | 458,232 | | | | 7,010,275 | | | | 7,468,507 | | | | 2,965,120 | | | 1980 | | 40 yrs. |
| 190 South Warner Road | | King of Prussia, PA | | | — | | | | 552,200 | | | | 3,162,600 | | | | 1,739,928 | | | | 461,909 | | | | 4,992,819 | | | | 5,454,728 | | | | 2,170,397 | | | 1980 | | 40 yrs. |
| 3100 Horizon Drive | | King of Prussia, PA | | | — | | | | 601,956 | | | | — | | | | 2,068,047 | | | | 611,436 | | | | 2,058,568 | | | | 2,670,003 | | | | 750,766 | | | 1995 | | 40 yrs. |
| 3500 Horizon Drive | | King of Prussia, PA | | | — | | | | 1,204,839 | | | | — | | | | 2,630,229 | | | | 1,223,875 | | | | 2,611,193 | | | | 3,835,068 | | | | 696,574 | | | 1996 | | 40 yrs. |
| 3000 Horizon Drive | | King of Prussia, PA | | | — | | | | 1,191,449 | | | | — | | | | 2,309,358 | | | | 946,703 | | | | 2,554,103 | | | | 3,500,806 | | | | 559,994 | | | 1997 | | 40 yrs. |
| 800 Town Center Drive | | Langhorne, PA | | | — | | | | 1,617,150 | | | | — | | | | 10,797,563 | | | | 1,619,288 | | | | 10,795,425 | | | | 12,414,713 | | | | 5,032,511 | | | 1987 | | 40 yrs. |
| 11425 State Highway 225 | | LaPorte, TX | | | — | | | | 975,974 | | | | 3,409,036 | | | | 7,682 | | | | 977,519 | | | | 3,415,173 | | | | 4,392,692 | | | | 31,583 | | | 2006 | | 40 yrs. |
| 11503 State Highway 225 | | LaPorte, TX | | | — | | | | 2,561,931 | | | | 9,779,023 | | | | 20,165 | | | | 2,565,988 | | | | 9,795,132 | | | | 12,361,120 | | | | 72,104 | | | 2006 | | 40 yrs. |
| 7528 Walker Way | | Lehigh Valley, PA | | | — | | | | 893,441 | | | | — | | | | 5,514,510 | | | | 779,330 | | | | 5,628,622 | | | | 6,407,952 | | | | 157,996 | | | 2004 | | 40 yrs. |
| 8301 Industrial Boulevard | | Lehigh, PA | | | — | | | | 11,249,550 | | | | — | | | | 44,122,702 | | | | 11,254,716 | | | | 44,117,536 | | | | 55,372,252 | | | | 1,310,158 | | | 2005 | | 40 yrs. |
| 32853 Edward Avenue | | Madison Heights, MI | | | — | | | | 138,121 | | | | 784,426 | | | | (5,207 | ) | | | 138,121 | | | | 779,219 | | | | 917,340 | | | | 210,450 | | | 1973 | | 40 yrs. |
| 750 East Mandoline Avenue | | Madison Heights, MI | | | — | | | | 151,458 | | | | 741,185 | | | | (80,456 | ) | | | 151,458 | | | | 660,728 | | | | 812,187 | | | | 172,982 | | | 1969 | | 40 yrs. |
| 900 East Mandoline Avenue | | Madison Heights, MI | | | — | | | | 157,729 | | | | 771,872 | | | | (43,850 | ) | | | 157,729 | | | | 728,022 | | | | 885,751 | | | | 223,686 | | | 1972 | | 40 yrs. |
| 31700 Research Park Drive | | Madison Heights, MI | | | — | | | | 373,202 | | | | 1,824,721 | | | | (158,741 | ) | | | 373,203 | | | | 1,665,979 | | | | 2,039,182 | | | | 382,957 | | | 1988 | | 40 yrs. |
| 31771 Sherman Avenue | | Madison Heights, MI | | | — | | | | 150,944 | | | | 645,040 | | | | (7,564 | ) | | | 150,944 | | | | 637,475 | | | | 788,420 | | | | 203,445 | | | 1982 | | 40 yrs. |
| 31791 Sherman Avenue | | Madison Heights, MI | | | — | | | | 105,606 | | | | 649,891 | | | | (54,791 | ) | | | 105,606 | | | | 595,100 | | | | 700,706 | | | | 143,185 | | | 1983 | | 40 yrs. |
| 31811 Sherman Avenue | | Madison Heights, MI | | | — | | | | 207,599 | | | | 1,179,010 | | | | (149,901 | ) | | | 207,599 | | | | 1,029,110 | | | | 1,236,709 | | | | 254,186 | | | 1983 | | 40 yrs. |
| 1201 East Whitcomb Avenue | | Madison Heights, MI | | | — | | | | 302,567 | | | | 1,213,232 | | | | (175,088 | ) | | | 302,567 | | | | 1,038,144 | | | | 1,340,711 | | | | 266,116 | | | 1980 | | 40 yrs. |
| 1901 Summit Tower Boulevard | | Maitland, FL | | | — | | | | 6,078,791 | | | | 12,348,567 | | | | 1,625,469 | | | | 6,083,206 | | | | 13,969,622 | | | | 20,052,828 | | | | 2,792,232 | | | 1998 | | 40 yrs. |
| 45-67 Great Valley Parkway | | Malvern, PA | | | — | | | | 795,143 | | | | — | | | | 3,352,726 | | | | 795,831 | | | | 3,352,038 | | | | 4,147,869 | | | | 2,136,395 | | | 1974 | | 40 yrs. |
| 11,15 Great Valley Parkway | | Malvern, PA | | | * | | | | 1,837,050 | | | | — | | | | 15,005,064 | | | | 1,837,878 | | | | 15,004,237 | | | | 16,842,114 | | | | 9,920,837 | | | 1986 | | 40 yrs. |
| 27-43 Great Valley Parkway | | Malvern, PA | | | — | | | | 448,775 | | | | — | | | | 2,545,542 | | | | 449,447 | | | | 2,544,870 | | | | 2,994,317 | | | | 1,549,853 | | | 1977 | | 40 yrs. |
| 1 Country View Road | | Malvern, PA | | | — | | | | 400,000 | | | | 3,600,000 | | | | 1,007,648 | | | | 406,421 | | | | 4,601,227 | | | | 5,007,648 | | | | 1,396,584 | | | 1982 | | 40 yrs. |
| 200 Chesterfield Parkway | | Malvern, PA | | | — | | | | 495,893 | | | | 2,739,093 | | | | 558,159 | | | | 544,649 | | | | 3,248,496 | | | | 3,793,145 | | | | 1,920,292 | | | 1989 | | 40 yrs. |
| 50 Morehall Road | | Malvern, PA | | | — | | | | 849,576 | | | | — | | | | 13,043,717 | | | | 1,337,076 | | | | 12,556,217 | | | | 13,893,293 | | | | 4,337,326 | | | 1997 | | 40 yrs. |
| 1 Great Valley Parkway | | Malvern, PA | | | — | | | | 419,460 | | | | 3,792,570 | | | | 330,704 | | | | 419,460 | | | | 4,123,273 | | | | 4,542,734 | | | | 1,064,218 | | | 1982 | | 40 yrs. |
99
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 5 Great Valley Parkway | | Malvern, PA | | | — | | | | 684,200 | | | | 6,181,661 | | | | 1,305,825 | | | | 684,200 | | | | 7,487,486 | | | | 8,171,686 | | | | 1,853,061 | | | 1983 | | 40 yrs. |
| 1001 Cedar Hollow Road | | Malvern, PA | | | — | | | | 1,436,814 | | | | — | | | | 16,077,184 | | | | 1,676,470 | | | | 15,837,528 | | | | 17,513,998 | | | | 4,972,256 | | | 1998 | | 40 yrs. |
| 3 Country View Road | | Malvern, PA | | | * | | | | 814,278 | | | | — | | | | 5,142,433 | | | | 1,128,881 | | | | 4,827,830 | | | | 5,956,711 | | | | 984,217 | | | 1998 | | 40 yrs. |
| 425 Technology Drive | | Malvern, PA | | | — | | | | 191,114 | | | | — | | | | 2,101,323 | | | | 321,473 | | | | 1,970,964 | | | | 2,292,437 | | | | 698,708 | | | 1998 | | 40 yrs. |
| 375 Technology Drive | | Malvern, PA | | | — | | | | 191,114 | | | | — | | | | 1,958,524 | | | | 234,922 | | | | 1,914,715 | | | | 2,149,638 | | | | 703,554 | | | 1998 | | 40 yrs. |
| 45 Liberty Boulevard | | Malvern, PA | | | — | | | | 4,380,221 | | | | — | | | | 15,314,868 | | | | 4,749,748 | | | | 14,945,341 | | | | 19,695,089 | | | | 4,425,097 | | | 1999 | | 40 yrs. |
| 100 Chesterfield Parkway | | Malvern, PA | | | — | | | | 1,320,625 | | | | — | | | | 7,019,034 | | | | 1,349,954 | | | | 6,989,705 | | | | 8,339,659 | | | | 2,255,284 | | | 1998 | | 40 yrs. |
| 600 Chesterfield Parkway | | Malvern, PA | | | — | | | | 2,013,750 | | | | — | | | | 8,135,324 | | | | 2,050,555 | | | | 8,098,519 | | | | 10,149,074 | | | | 2,360,776 | | | 1999 | | 40 yrs. |
| 700 Chesterfield Parkway | | Malvern, PA | | | — | | | | 2,013,750 | | | | — | | | | 8,096,150 | | | | 2,037,813 | | | | 8,072,087 | | | | 10,109,900 | | | | 2,337,776 | | | 1999 | | 40 yrs. |
| 18 Great Valley Parkway | | Malvern, PA | | | — | | | | 394,036 | | | | 3,976,221 | | | | 99,539 | | | | 397,293 | | | | 4,072,504 | | | | 4,469,796 | | | | 823,431 | | | 1980 | | 40 yrs. |
| 11 Great Valley Parkway | | Malvern, PA | | | — | | | | 496,297 | | | | — | | | | 3,226,924 | | | | 708,331 | | | | 3,014,890 | | | | 3,723,221 | | | | 672,667 | | | 2001 | | 40 yrs. |
| 40 Liberty Boulevard | | Malvern, PA | | | — | | | | 4,241,137 | | | | 17,737,090 | | | | 2,182,842 | | | | 4,241,167 | | | | 19,919,901 | | | | 24,161,068 | | | | 5,326,655 | | | 1989 | | 40 yrs. |
| 2 West Liberty Boulevard | | Malvern, PA | | | — | | | | 5,405,041 | | | | — | | | | 11,415,086 | | | | 5,405,042 | | | | 11,415,085 | | | | 16,820,127 | | | | 400,621 | | | 2003 | | 40 yrs. |
| 10 Great Valley Parkway | | Malvern, PA | | | — | | | | 823,540 | | | | 1,341,376 | | | | 256,839 | | | | 832,244 | | | | 1,589,510 | | | | 2,421,754 | | | | 135,101 | | | 2003 | | 40 yrs. |
| 10, 20 Liberty Boulevard | | Malvern, PA | | | — | | | | 724,058 | | | | — | | | | 5,767,715 | | | | 724,846 | | | | 5,766,927 | | | | 6,491,773 | | | | 2,492,462 | | | 1985 | | 40 yrs. |
| 420 Lapp Road | | Malvern, PA | | | — | | | | 1,054,418 | | | | — | | | | 6,995,922 | | | | 1,055,243 | | | | 6,995,097 | | | | 8,050,340 | | | | 3,081,121 | | | 1989 | | 40 yrs. |
| 14 Lee Boulevard | | Malvern, PA | | | — | | | | 664,282 | | | | — | | | | 5,855,867 | | | | 643,892 | | | | 5,876,257 | | | | 6,520,149 | | | | 2,676,923 | | | 1988 | | 40 yrs. |
| 500 Chesterfield Parkway | | Malvern, PA | | | — | | | | 472,364 | | | | — | | | | 3,276,521 | | | | 473,139 | | | | 3,275,746 | | | | 3,748,885 | | | | 1,665,286 | | | 1988 | | 40 yrs. |
| 300-400 Chesterfield Parkway | | Malvern, PA | | | — | | | | 937,212 | | | | — | | | | 5,616,170 | | | | 937,942 | | | | 5,615,440 | | | | 6,553,382 | | | | 2,587,331 | | | 1988 | | 40 yrs. |
| 40 Valley Stream Parkway | | Malvern, PA | | | — | | | | 322,918 | | | | — | | | | 3,224,458 | | | | 325,775 | | | | 3,221,601 | | | | 3,547,376 | | | | 1,327,967 | | | 1987 | | 40 yrs. |
| 50 Valley Stream Parkway | | Malvern, PA | | | — | | | | 323,971 | | | | — | | | | 2,694,447 | | | | 323,792 | | | | 2,694,627 | | | | 3,018,418 | | | | 1,147,301 | | | 1987 | | 40 yrs. |
| 20 Valley Stream Parkway | | Malvern, PA | | | — | | | | 465,539 | | | | — | | | | 5,726,197 | | | | 466,413 | | | | 5,725,323 | | | | 6,191,736 | | | | 2,874,409 | | | 1987 | | 40 yrs. |
| 257-275 Great Valley Parkway | | Malvern, PA | | | — | | | | 504,611 | | | | — | | | | 5,186,454 | | | | 505,458 | | | | 5,185,606 | | | | 5,691,065 | | | | 2,963,952 | | | 1983 | | 40 yrs. |
| 300 Technology Drive | | Malvern, PA | | | — | | | | 368,626 | | | | — | | | | 1,344,816 | | | | 374,497 | | | | 1,338,945 | | | | 1,713,442 | | | | 706,537 | | | 1985 | | 40 yrs. |
| 277-293 Great Valley Parkway | | Malvern, PA | | | — | | | | 530,729 | | | | — | | | | 2,330,242 | | | | 531,534 | | | | 2,329,436 | | | | 2,860,971 | | | | 1,322,006 | | | 1984 | | 40 yrs. |
| 311 Technology Drive | | Malvern, PA | | | — | | | | 397,131 | | | | — | | | | 2,724,819 | | | | 397,948 | | | | 2,724,002 | | | | 3,121,950 | | | | 1,423,585 | | | 1984 | | 40 yrs. |
| 7 Great Valley Parkway | | Malvern, PA | | | — | | | | 176,435 | | | | — | | | | 5,036,553 | | | | 177,317 | | | | 5,035,671 | | | | 5,212,988 | | | | 2,814,524 | | | 1985 | | 40 yrs. |
| 55 Valley Stream Parkway | | Malvern, PA | | | — | | | | 215,005 | | | | — | | | | 4,281,663 | | | | 215,818 | | | | 4,280,850 | | | | 4,496,668 | | | | 1,915,746 | | | 1983 | | 40 yrs. |
| 65 Valley Stream Parkway | | Malvern, PA | | | — | | | | 381,544 | | | | — | | | | 7,597,364 | | | | 382,361 | | | | 7,596,548 | | | | 7,978,908 | | | | 3,914,905 | | | 1983 | | 40 yrs. |
| 508 Lapp Road | | Malvern, PA | | | — | | | | 331,392 | | | | — | | | | 2,033,164 | | | | 332,216 | | | | 2,032,340 | | | | 2,364,556 | | | | 1,228,001 | | | 1984 | | 40 yrs. |
| 10 Valley Stream Parkway | | Malvern, PA | | | * | | | | 509,075 | | | | — | | | | 3,089,935 | | | | 509,899 | | | | 3,089,111 | | | | 3,599,010 | | | | 1,714,026 | | | 1984 | | 40 yrs. |
| 333 Phoenixville Pike | | Malvern, PA | | | — | | | | 523,530 | | | | — | | | | 2,917,373 | | | | 524,230 | | | | 2,916,673 | | | | 3,440,903 | | | | 1,580,984 | | | 1985 | | 40 yrs. |
| 30 Great Valley Parkway | | Malvern, PA | | | — | | | | 128,126 | | | | — | | | | 85,634 | | | | 128,783 | | | | 384,977 | | | | 513,760 | | | | 315,346 | | | 1975 | | 40 yrs. |
| 75 Great Valley Parkway | | Malvern, PA | | | 350,090 | | | | 143,074 | | | | — | | | | 772,841 | | | | 143,811 | | | | 772,103 | | | | 915,915 | | | | 577,889 | | | 1977 | | 40 yrs. |
| 77-123 Great Valley Parkway | | Malvern, PA | | | — | | | | 887,664 | | | | — | | | | 5,700,921 | | | | 888,359 | | | | 5,700,225 | | | | 6,588,585 | | | | 3,391,343 | | | 1978 | | 40 yrs. |
| 256 Great Valley Parkway | | Malvern, PA | | | — | | | | 161,098 | | | | — | | | | 1,785,717 | | | | 161,949 | | | | 1,784,866 | | | | 1,946,815 | | | | 1,157,980 | | | 1980 | | 40 yrs. |
| 205 Great Valley Parkway | | Malvern, PA | | | — | | | | 1,368,259 | | | | — | | | | 10,706,926 | | | | 1,369,003 | | | | 10,706,182 | | | | 12,075,185 | | | | 6,686,126 | | | 1981 | | 40 yrs. |
| 12,14,16 Great Valley Parkway | | Malvern, PA | | | — | | | | 130,689 | | | | — | | | | 1,562,994 | | | | 128,767 | | | | 1,564,916 | | | | 1,693,683 | | | | 884,224 | | | 1982 | | 40 yrs. |
| 155 Great Valley Parkway | | Malvern, PA | | | — | | | | 625,147 | | | | — | | | | 2,627,280 | | | | 626,068 | | | | 2,626,359 | | | | 3,252,427 | | | | 1,541,665 | | | 1981 | | 40 yrs. |
| 510 Lapp Road | | Malvern, PA | | | * | | | | 356,950 | | | | — | | | | 926,587 | | | | 357,751 | | | | 925,786 | | | | 1,283,537 | | | | 572,178 | | | 1983 | | 40 yrs. |
| 60 Morehall Road | | Malvern, PA | | | — | | | | 865,424 | | | | 9,285,000 | | | | 4,971,296 | | | | 884,974 | | | | 14,236,746 | | | | 15,121,720 | | | | 6,358,326 | | | 1989 | | 40 yrs. |
| 5 Country View Road | | Malvern, PA | | | * | | | | 785,168 | | | | 4,678,632 | | | | 1,178,927 | | | | 786,235 | | | | 5,856,492 | | | | 6,642,727 | | | | 1,953,040 | | | 1985 | | 40 yrs. |
| 7550 Meridian Circle | | Maple Grove, MN | | | — | | | | 513,250 | | | | 2,901,906 | | | | 222,006 | | | | 513,250 | | | | 3,123,911 | | | | 3,637,161 | | | | 721,019 | | | 1989 | | 40 yrs. |
| 8 Stow Road | | Marlton, NJ | | | — | | | | 172,600 | | | | 1,704,436 | | | | 188,555 | | | | 172,945 | | | | 1,892,646 | | | | 2,065,591 | | | | 651,714 | | | 1988 | | 40 yrs. |
| 10 Stow Road | | Marlton, NJ | | | — | | | | 147,000 | | | | 1,451,536 | | | | 527,956 | | | | 147,318 | | | | 1,979,174 | | | | 2,126,492 | | | | 962,254 | | | 1988 | | 40 yrs. |
| 12 Stow Road | | Marlton, NJ | | | — | | | | 103,300 | | | | 1,021,036 | | | | 342,868 | | | | 103,618 | | | | 1,363,587 | | | | 1,467,205 | | | | 588,823 | | | 1988 | | 40 yrs. |
| 14 Stow Road | | Marlton, NJ | | | — | | | | 93,100 | | | | 920,336 | | | | 431,684 | | | | 93,418 | | | | 1,351,703 | | | | 1,445,120 | | | | 576,452 | | | 1988 | | 40 yrs. |
| 701A Route 73 South | | Marlton, NJ | | | — | | | | 264,387 | | | | 3,772,000 | | | | 3,501,001 | | | | 271,743 | | | | 7,265,645 | | | | 7,537,388 | | | | 3,312,275 | | | 1987 | | 40 yrs. |
| 701C Route 73 South | | Marlton, NJ | | | — | | | | 84,949 | | | | 1,328,000 | | | | 422,106 | | | | 96,161 | | | | 1,738,894 | | | | 1,835,055 | | | | 672,972 | | | 1987 | | 40 yrs. |
| 400 Lippincott Drive | | Marlton, NJ | | | — | | | | 69,402 | | | | — | | | | 3,671,296 | | | | 317,799 | | | | 3,422,899 | | | | 3,740,699 | | | | 910,493 | | | 1999 | | 40 yrs. |
| 406 Lippincott Drive | | Marlton, NJ | | | — | | | | 321,455 | | | | 1,539,871 | | | | 888,175 | | | | 327,554 | | | | 2,421,947 | | | | 2,749,501 | | | | 975,306 | | | 1990 | | 40 yrs. |
| 301 Lippincott Drive | | Marlton, NJ | | | — | | | | 1,069,837 | | | | 4,780,163 | | | | 1,469,444 | | | | 1,069,838 | | | | 6,249,607 | | | | 7,319,444 | | | | 2,078,211 | | | 1988 | | 40 yrs. |
| 303 Lippincott Drive | | Marlton, NJ | | | — | | | | 1,069,837 | | | | 4,780,163 | | | | 2,194,896 | | | | 1,069,838 | | | | 6,975,059 | | | | 8,044,896 | | | | 2,276,639 | | | 1988 | | 40 yrs. |
| 901 Route 73 | | Marlton, NJ | | | — | | | | 334,411 | | | | 2,733,314 | | | | 894,989 | | | | 334,411 | | | | 3,628,303 | | | | 3,962,714 | | | | 1,045,261 | | | 1985 | | 40 yrs. |
| 404 Lippincott Drive | | Marlton, NJ | | | — | | | | 131,896 | | | | — | | | | 1,653,262 | | | | 131,896 | | | | 1,653,262 | | | | 1,785,158 | | | | 657,060 | | | 1997 | | 40 yrs. |
| 402 Lippincott Drive | | Marlton, NJ | | | — | | | | 131,896 | | | | — | | | | 1,736,907 | | | | 131,896 | | | | 1,736,907 | | | | 1,868,803 | | | | 682,815 | | | 1997 | | 40 yrs. |
| 9 Stow Road | | Marlton, NJ | | | — | | | | 652,642 | | | | 1,765,065 | | | | 922,394 | | | | 654,779 | | | | 2,685,323 | | | | 3,340,101 | | | | 766,449 | | | 1989 | | 40 yrs. |
| 75 Brookfield Oaks Drive | | Mauldin, SC | | | — | | | | 419,731 | | | | — | | | | 2,444,403 | | | | 430,909 | | | | 2,433,225 | | | | 2,864,134 | | | | 68,857 | | | 2003 | | 40 yrs. |
| 65 Brookfield Oaks Drive | | Mauldin, SC | | | — | | | | 557,174 | | | | — | | | | 2,728,911 | | | | 506,318 | | | | 2,779,768 | | | | 3,286,086 | | | | 67,739 | | | 2004 | | 40 yrs. |
| 8301 West Parkland Court | | Milwaukee, WI | | | — | | | | 358,442 | | | | 3,233,707 | | | | 532,301 | | | | 358,442 | | | | 3,766,008 | | | | 4,124,449 | | | | 971,466 | | | 1982 | | 40 yrs. |
| 7800 N. 113th Street | | Milwaukee, WI | | | — | | | | 1,711,964 | | | | 6,847,857 | | | | 392,036 | | | | 1,711,964 | | | | 7,239,893 | | | | 8,951,858 | | | | 1,726,879 | | | 1991 | | 40 yrs. |
| 11950 W. Lake Park Drive | | Milwaukee, WI | | | — | | | | 391,813 | | | | 2,340,118 | | | | 539,517 | | | | 394,938 | | | | 2,876,510 | | | | 3,271,448 | | | | 719,848 | | | 1986 | | 40 yrs. |
| 11400 W. Lake Park Drive | | Milwaukee, WI | | | — | | | | 439,595 | | | | 2,357,904 | | | | 234,658 | | | | 443,101 | | | | 2,589,056 | | | | 3,032,157 | | | | 521,325 | | | 1986 | | 40 yrs. |
100
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11425 W. Lake Park Drive | | Milwaukee, WI | | | — | | | | 382,256 | | | | 2,350,619 | | | | 957,723 | | | | 385,305 | | | | 3,305,293 | | | | 3,690,598 | | | | 982,930 | | | 1987 | | 40 yrs. |
| 11301 W. Lake Park Drive | | Milwaukee, WI | | | — | | | | 614,477 | | | | 2,626,456 | | | | 101,328 | | | | 619,465 | | | | 2,722,797 | | | | 3,342,261 | | | | 542,487 | | | 1987 | | 40 yrs. |
| 11900 W. Lake Park Drive | | Milwaukee, WI | | | — | | | | 347,853 | | | | 2,396,887 | | | | 1,057,251 | | | | 350,628 | | | | 3,451,364 | | | | 3,801,992 | | | | 910,149 | | | 1987 | | 40 yrs. |
| 11414 West Park Place | | Milwaukee, WI | | | — | | | | 234,443 | | | | — | | | | 10,202,898 | | | | 491,531 | | | | 9,945,810 | | | | 10,437,341 | | | | 2,308,691 | | | 2001 | | 40 yrs. |
| 11520 West Calumet Road | | Milwaukee, WI | | | — | | | | 341,698 | | | | 1,527,548 | | | | 78,494 | | | | 341,698 | | | | 1,606,042 | | | | 1,947,740 | | | | 281,217 | | | 1995 | | 40 yrs. |
| 12100 West Park Place | | Milwaukee, WI | | | — | | | | 534,470 | | | | 3,239,389 | | | | 565,184 | | | | 532,370 | | | | 3,806,673 | | | | 4,339,043 | | | | 779,371 | | | 1984 | | 40 yrs. |
| 10855 West Park Place | | Milwaukee, WI | | | — | | | | 122,894 | | | | — | | | | 3,045,358 | | | | 424,710 | | | | 2,743,541 | | | | 3,168,251 | | | | 447,822 | | | 2002 | | 40 yrs. |
| 11100 West Liberty Drive | | Milwaukee, WI | | | — | | | | 1,800,000 | | | | — | | | | 7,690,908 | | | | 1,801,024 | | | | 7,689,884 | | | | 9,490,908 | | | | 730,540 | | | 2003 | | 40 yrs. |
| 11050 West Liberty Drive | | Milwaukee, WI | | | — | | | | — | | | | — | | | | 3,813,517 | | | | 914,760 | | | | 2,898,757 | | | | 3,813,517 | | | | 25,802 | | | 2005 | | 40 yrs. |
| 4700 Nathan Lane North | | Minneapolis, MN | | | — | | | | 1,501,308 | | | | 8,446,083 | | | | 225,056 | | | | 1,501,308 | | | | 8,671,139 | | | | 10,172,447 | | | | 1,567,239 | | | 1996 | | 40 yrs. |
| 4600 Nathan Lane | | Minneapolis, MN | | | — | | | | 1,063,558 | | | | — | | | | 6,683,083 | | | | 1,038,197 | | | | 6,708,444 | | | | 7,746,641 | | | | 1,363,486 | | | 2002 | | 40 yrs. |
| 12501 & 12701 Whitewater Drive | | Minnegonka, MN | | | — | | | | 2,175,209 | | | | 3,948,085 | | | | 7,249,452 | | | | 2,177,953 | | | | 11,194,793 | | | | 13,372,746 | | | | 788,290 | | | 1986 | | 40 yrs. |
| 5600 & 5610 Rowland Road | | Minnetonka, MN | | | — | | | | 828,650 | | | | 7,399,409 | | | | 1,595,422 | | | | 829,263 | | | | 8,994,217 | | | | 9,823,481 | | | | 2,892,234 | | | 1988 | | 40 yrs. |
| 5400-5500 Feltl Road | | Minnetonka, MN | | | — | | | | 883,895 | | | | 7,983,345 | | | | 2,275,102 | | | | 883,895 | | | | 10,258,447 | | | | 11,142,342 | | | | 2,480,922 | | | 1985 | | 40 yrs. |
| 10300 Bren Road | | Minnetonka, MN | | | — | | | | 344,614 | | | | 3,110,477 | | | | 894,944 | | | | 344,614 | | | | 4,005,421 | | | | 4,350,034 | | | | 857,897 | | | 1981 | | 40 yrs. |
| 3400 Lakeside Drive | | Miramar, FL | | | — | | | | 2,022,153 | | | | 11,345,881 | | | | 1,214,422 | | | | 2,022,153 | | | | 12,560,302 | | | | 14,582,456 | | | | 3,135,197 | | | 1990 | | 40 yrs. |
| 3450 Lakeside Drive | | Miramar, FL | | | — | | | | 2,022,152 | | | | 11,357,143 | | | | 2,078,093 | | | | 2,022,152 | | | | 13,435,235 | | | | 15,457,387 | | | | 3,478,905 | | | 1990 | | 40 yrs. |
| 3350 SW 148th Avenue | | Miramar, FL | | | — | | | | 2,960,511 | | | | — | | | | 19,294,616 | | | | 2,980,689 | | | | 19,274,437 | | | | 22,255,127 | | | | 4,341,655 | | | 2000 | | 40 yrs. |
| 300 Fellowship Road | | Mt Laurel, NJ | | | — | | | | — | | | | — | | | | 7,330,090 | | | | 1,098,904 | | | | 6,231,186 | | | | 7,330,090 | | | | 420,257 | | | 2004 | | 40 yrs. |
| 302 Fellowship Road | | Mt Laurel, NJ | | | — | | | | 1,512,120 | | | | — | | | | 2,801,598 | | | | 539,060 | | | | 3,774,658 | | | | 4,313,718 | | | | 88,186 | | | 2001 | | 40 yrs. |
| 3001 Leadenhall Road | | Mt Laurel, NJ | | | — | | | | 1,925,719 | | | | 191,390 | | | | 10,965,396 | | | | 1,936,489 | | | | 11,146,016 | | | | 13,082,505 | | | | 879,074 | | | 2003 | | 40 yrs. |
| 350 Fellowship Road | | Mt Laurel, NJ | | | — | | | | 2,960,159 | | | | 1,449,611 | | | | 3,535,489 | | | | 2,966,686 | | | | 4,978,573 | | | | 7,945,259 | | | | 9,251 | | | 2006 | | 40 yrs. |
| 4001 Leadenhall Road | | Mt. Laurel, NJ | | | — | | | | 3,207,885 | | | | 391,167 | | | | 18,844,592 | | | | 2,784,694 | | | | 19,658,950 | | | | 22,443,644 | | | | 2,744,761 | | | 2002 | | 40 yrs. |
| 3000 Atrium Way | | Mt. Laurel, NJ | | | — | | | | 500,000 | | | | 4,500,000 | | | | 4,498,462 | | | | 512,018 | | | | 8,986,445 | | | | 9,498,462 | | | | 3,980,005 | | | 1987 | | 40 yrs. |
| 11000, 15000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 310,585 | | | | 4,394,900 | | | | 254,820 | | | | 311,950 | | | | 4,648,355 | | | | 4,960,305 | | | | 1,942,493 | | | 1985 | | 40 yrs. |
| 12000, 14000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 361,800 | | | | 3,285,817 | | | | 783,587 | | | | 362,855 | | | | 4,068,349 | | | | 4,431,204 | | | | 1,426,020 | | | 1985 | | 40 yrs. |
| 16000, 18000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 289,700 | | | | 2,512,683 | | | | 573,915 | | | | 290,545 | | | | 3,085,753 | | | | 3,376,298 | | | | 1,126,581 | | | 1985 | | 40 yrs. |
| 1300 Route 73 North | | Mt. Laurel, NJ | | | — | | | | 449,400 | | | | 3,074,850 | | | | 1,704,275 | | | | 450,558 | | | | 4,777,967 | | | | 5,228,525 | | | | 1,530,369 | | | 1988 | | 40 yrs. |
| 6000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 234,151 | | | | 2,022,683 | | | | 925,491 | | | | 234,151 | | | | 2,948,174 | | | | 3,182,325 | | | | 811,584 | | | 1985 | | 40 yrs. |
| 7000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 260,014 | | | | 2,236,684 | | | | 427,949 | | | | 260,014 | | | | 2,664,633 | | | | 2,924,647 | | | | 746,489 | | | 1984 | | 40 yrs. |
| 8000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 234,814 | | | | 1,995,098 | | | | 317,849 | | | | 234,814 | | | | 2,312,947 | | | | 2,547,761 | | | | 604,374 | | | 1983 | | 40 yrs. |
| 9000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 286,587 | | | | 2,474,820 | | | | 595,749 | | | | 286,587 | | | | 3,070,569 | | | | 3,357,156 | | | | 1,010,672 | | | 1983 | | 40 yrs. |
| 1000 Briggs Road | | Mt. Laurel, NJ | | | — | | | | 288,577 | | | | 2,546,537 | | | | 1,450,255 | | | | 288,577 | | | | 3,996,792 | | | | 4,285,369 | | | | 1,422,723 | | | 1986 | | 40 yrs. |
| 1025 Briggs Road | | Mt. Laurel, NJ | | | 773,515 | | | | 430,990 | | | | 3,714,828 | | | | 1,320,195 | | | | 430,990 | | | | 5,035,023 | | | | 5,466,013 | | | | 1,496,665 | | | 1987 | | 40 yrs. |
| 1020 Briggs Road | | Mt. Laurel, NJ | | | — | | | | 494,334 | | | | — | | | | 3,162,455 | | | | 569,184 | | | | 3,087,606 | | | | 3,656,789 | | | | 825,078 | | | 1999 | | 40 yrs. |
| 2000 Crawford Place | | Mt. Laurel, NJ | | | — | | | | 310,831 | | | | 2,797,744 | | | | 2,814,041 | | | | 310,831 | | | | 5,611,785 | | | | 5,922,616 | | | | 2,067,243 | | | 1986 | | 40 yrs. |
| 5000 Dearborn Court | | Mt. Laurel, NJ | | | — | | | | 1,057,763 | | | | 4,191,827 | | | | 531,794 | | | | 1,057,763 | | | | 4,723,621 | | | | 5,781,384 | | | | 1,129,274 | | | 1988 | | 40 yrs. |
| 1001 Briggs Road | | Mt. Laurel, NJ | | | — | | | | 701,705 | | | | 3,505,652 | | | | 2,115,996 | | | | 701,705 | | | | 5,621,649 | | | | 6,323,354 | | | | 1,805,100 | | | 1986 | | 40 yrs. |
| 1015 Briggs Road | | Mt. Laurel, NJ | | | — | | | | 356,987 | | | | — | | | | 3,666,093 | | | | 470,659 | | | | 3,552,421 | | | | 4,023,080 | | | | 792,151 | | | 2000 | | 40 yrs. |
| 17000 Commerce Parkway | | Mt. Laurel, NJ | | | — | | | | 144,515 | | | | — | | | | 3,010,679 | | | | 144,515 | | | | 3,010,679 | | | | 3,155,194 | | | | 691,482 | | | 2001 | | 40 yrs. |
| 9401-9443 Science Center Drive | | New Hope, MN | | | — | | | | 431,295 | | | | 3,888,684 | | | | 480,123 | | | | 510,064 | | | | 4,290,038 | | | | 4,800,102 | | | | 1,115,258 | | | 1989 | | 40 yrs. |
| 6 Terry Drive | | Newtown, PA | | | — | | | | 622,029 | | | | 2,228,851 | | | | 828,769 | | | | 622,205 | | | | 3,057,443 | | | | 3,679,648 | | | | 824,454 | | | 1981 | | 40 yrs. |
| 550-590 Hale Avenue | | Oakdale, MN | | | — | | | | 765,535 | | | | 3,488,754 | | | | 510,819 | | | | 766,390 | | | | 3,998,718 | | | | 4,765,107 | | | | 847,827 | | | 1996 | | 40 yrs. |
| 1879 Lamont Avenue | | Odenton, MD | | | — | | | | 1,976,000 | | | | 8,099,579 | | | | 3,032,136 | | | | 2,011,030 | | | | 11,096,685 | | | | 13,107,715 | | | | 524,714 | | | 2004 | | 40 yrs. |
| 350 Winmeyer Avenue | | Odenton, MD | | | — | | | | 1,778,400 | | | | 7,289,165 | | | | 1,924,628 | | | | 1,809,927 | | | | 9,182,266 | | | | 10,992,193 | | | | 388,054 | | | 2004 | | 40 yrs. |
| 9600 Satellite Boulevard | | Orlando, FL | | | — | | | | 252,850 | | | | 1,297,923 | | | | 62,116 | | | | 252,850 | | | | 1,360,039 | | | | 1,612,889 | | | | 336,709 | | | 1989 | | 40 yrs. |
| 9700 Satellite Boulevard | | Orlando, FL | | | — | | | | 405,362 | | | | 1,146,546 | | | | 350,999 | | | | 405,362 | | | | 1,497,545 | | | | 1,902,907 | | | | 387,847 | | | 1989 | | 40 yrs. |
| 1902 Cypress Lake Drive | | Orlando, FL | | | — | | | | 523,512 | | | | 3,191,790 | | | | 880,341 | | | | 538,512 | | | | 4,057,131 | | | | 4,595,643 | | | | 1,116,154 | | | 1989 | | 40 yrs. |
| 9550 Satellite Boulevard | | Orlando, FL | | | — | | | | 574,831 | | | | — | | | | 2,330,526 | | | | 587,319 | | | | 2,318,038 | | | | 2,905,357 | | | | 594,480 | | | 1999 | | 40 yrs. |
| 10511 & 10611 Satellite Boulevard | | Orlando, FL | | | — | | | | 517,554 | | | | 2,568,186 | | | | 405,635 | | | | 522,991 | | | | 2,968,384 | | | | 3,491,375 | | | | 848,378 | | | 1985 | | 40 yrs. |
| 1400-1440 Central Florida Parkway | | Orlando, FL | | | — | | | | 518,043 | | | | 2,561,938 | | | | 337,852 | | | | 518,043 | | | | 2,899,790 | | | | 3,417,833 | | | | 713,673 | | | 1962 | | 40 yrs. |
| 2216 Directors Row | | Orlando, FL | | | — | | | | 453,918 | | | | 2,572,202 | | | | 27,479 | | | | 453,918 | | | | 2,599,681 | | | | 3,053,599 | | | | 555,992 | | | 1998 | | 40 yrs. |
| 3701-3727 Vineland Road | | Orlando, FL | | | — | | | | 767,929 | | | | 2,096,504 | | | | 430,124 | | | | 767,929 | | | | 2,526,628 | | | | 3,294,557 | | | | 549,972 | | | 1985 | | 40 yrs. |
| 2400 South Lake Orange Drive | | Orlando, FL | | | — | | | | 385,964 | | | | — | | | | 2,461,057 | | | | 642,427 | | | | 2,204,594 | | | | 2,847,021 | | | | 355,814 | | | 2001 | | 40 yrs. |
| 6501 Lee Vista Boulevard | | Orlando, FL | | | — | | | | 903,701 | | | | — | | | | 5,560,142 | | | | 925,671 | | | | 5,538,172 | | | | 6,463,843 | | | | 746,789 | | | 2001 | | 40 yrs. |
| 2416 Lake Orange Drive | | Orlando, FL | | | — | | | | 535,964 | | | | — | | | | 3,166,980 | | | | 704,800 | | | | 2,998,143 | | | | 3,702,944 | | | | 741,196 | | | 2002 | | 40 yrs. |
| 10771 Palm Bay Drive | | Orlando, FL | | | — | | | | 664,605 | | | | — | | | | 2,362,814 | | | | 685,383 | | | | 2,342,035 | | | | 3,027,419 | | | | 299,543 | | | 2001 | | 40 yrs. |
| 10003 Satellite Boulevard | | Orlando, FL | | | — | | | | 680,312 | | | | 2,120,754 | | | | 1,498,831 | | | | 680,312 | | | | 3,619,585 | | | | 4,299,897 | | | | 366,260 | | | 2003 | | 40 yrs. |
| 1090 Gills Drive | | Orlando, FL | | | — | | | | 878,320 | | | | 2,558,833 | | | | 1,872,262 | | | | 878,320 | | | | 4,431,096 | | | | 5,309,415 | | | | 310,566 | | | 2003 | | 40 yrs. |
| 2202 Taft-Vineland Road | | Orlando, FL | | | — | | | | — | | | | — | | | | 6,630,654 | | | | 1,283,713 | | | | 5,346,941 | | | | 6,630,654 | | | | 565,267 | | | 2004 | | 40 yrs. |
| South Center Land-Phase II | | Orlando, FL | | | — | | | | 838,853 | | | | — | | | | 4,047,910 | | | | 767,953 | | | | 4,118,811 | | | | 4,886,763 | | | | 36,846 | | | 2006 | | 40 yrs. |
| 7315 Kingspointe Parkway | | Orlando, FL | | | — | | | | 1,931,697 | | | | 6,388,203 | | | | 2,479,134 | | | | 1,932,004 | | | | 8,867,030 | | | | 10,799,034 | | | | 589,186 | | | 2004 | | 40 yrs. |
| 2351 Investors Row | | Orlando, FL | | | — | | | | 2,261,924 | | | | 7,496,249 | | | | 124,169 | | | | 2,263,211 | | | | 7,619,131 | | | | 9,882,342 | | | | 376,159 | | | 2004 | | 40 yrs. |
101
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2256 Taft-Vineland Road | | Orlando, FL | | | — | | | | 467,296 | | | | — | | | | 2,462,307 | | | | 825,673 | | | | 2,103,930 | | | | 2,929,603 | | | | 104,125 | | | 2005 | | 40 yrs. |
| 1950 Summit Park Drive | | Orlando, FL | | | — | | | | 2,573,700 | | | | 17,478,646 | | | | 531,233 | | | | 2,583,667 | | | | 17,999,912 | | | | 20,583,579 | | | | 791,297 | | | 2005 | | 40 yrs. |
| 1958 Summit Park Drive | | Orlando, FL | | | — | | | | 2,573,961 | | | | 11,206,937 | | | | 8,761,919 | | | | 2,583,216 | | | | 19,959,601 | | | | 22,542,817 | | | | 892,725 | | | 2005 | | 40 yrs. |
| 6200 Lee Vista Boulevard | | Orlando, FL | | | — | | | | 1,423,584 | | | | 6,399,510 | | | | 84,494 | | | | 1,435,301 | | | | 6,472,287 | | | | 7,907,588 | | | | 67,921 | | | 2006 | | 40 yrs. |
| 7022 TPC Drive | | Orlando, FL | | | — | | | | 1,443,510 | | | | 6,845,559 | | | | 357,904 | | | | 1,457,286 | | | | 7,189,688 | | | | 8,646,973 | | | | — | | | 2006 | | 40 yrs. |
| 7100 TPC Drive | | Orlando, FL | | | — | | | | 1,431,489 | | | | 7,948,341 | | | | 203,122 | | | | 1,445,807 | | | | 8,137,144 | | | | 9,582,951 | | | | — | | | 2006 | | 40 yrs. |
| 7101 TPC Drive | | Orlando, FL | | | — | | | | 1,553,537 | | | | 5,301,499 | | | | 225,850 | | | | 1,570,863 | | | | 5,510,023 | | | | 7,080,886 | | | | — | | | 2006 | | 40 yrs. |
| N26 W23445 Paul Road | | Pewaukee, WI | | | — | | | | 561,904 | | | | 1,928,064 | | | | 113,241 | | | | 561,904 | | | | 2,041,305 | | | | 2,603,209 | | | | 357,110 | | | 1985 | | 40 yrs. |
| 8801 Tinicum Boulevard | | Philadelphia, PA | | | — | | | | 2,474,031 | | | | — | | | | 43,598,952 | | | | 125,087 | | | | 45,947,896 | | | | 46,072,983 | | | | 12,300,012 | | | 1997 | | 40 yrs. |
| 3 Franklin Plaza | | Philadelphia, PA | | | — | | | | 2,483,144 | | | | — | | | | 32,150,134 | | | | 2,514,519 | | | | 32,118,759 | | | | 34,633,278 | | | | 6,127,052 | | | 1999 | | 40 yrs. |
| 4751 League Island Boulevard | | Philadelphia, PA | | | — | | | | 992,965 | | | | 331,924 | | | | 6,753,197 | | | | 1,022,081 | | | | 7,056,006 | | | | 8,078,087 | | | | 573,955 | | | 2003 | | 40 yrs. |
| 1 Crescent Drive | | Philadelphia, PA | | | — | | | | 567,280 | | | | — | | | | 12,752,342 | | | | 347,892 | | | | 12,971,730 | | | | 13,319,622 | | | | 57,493 | | | 2004 | | 40 yrs. |
| 9801 80th Avenue | | Pleasant Prairie, WI | | | — | | | | 1,692,077 | | | | 7,934,794 | | | | 62,495 | | | | 1,689,726 | | | | 7,999,640 | | | | 9,689,366 | | | | 1,617,933 | | | 1994 | | 40 yrs. |
| 2250 Hickory Road | | Plymouth Meeting, PA | | | — | | | | 1,015,851 | | | | 9,175,555 | | | | 2,338,832 | | | | 1,032,507 | | | | 11,497,732 | | | | 12,530,239 | | | | 2,838,418 | | | 1985 | | 40 yrs. |
| 2905 Northwest Boulevard | | Plymouth, MN | | | — | | | | 516,920 | | | | 4,646,342 | | | | 1,702,547 | | | | 516,920 | | | | 6,348,890 | | | | 6,865,809 | | | | 1,853,696 | | | 1983 | | 40 yrs. |
| 2800 Campus Drive | | Plymouth, MN | | | — | | | | 395,366 | | | | 3,554,512 | | | | 1,008,452 | | | | 395,366 | | | | 4,562,964 | | | | 4,958,330 | | | | 1,357,056 | | | 1985 | | 40 yrs. |
| 2955 Xenium Lane | | Plymouth, MN | | | — | | | | 151,238 | | | | 1,370,140 | | | | 401,075 | | | | 151,238 | | | | 1,771,215 | | | | 1,922,453 | | | | 605,963 | | | 1985 | | 40 yrs. |
| 2920 Northwest Boulevard | | Plymouth, MN | | | — | | | | 392,026 | | | | 3,433,678 | | | | 655,417 | | | | 384,235 | | | | 4,096,886 | | | | 4,481,121 | | | | 1,151,892 | | | 1997 | | 40 yrs. |
| 14630-14650 28th Avenue North | | Plymouth, MN | | | — | | | | 198,205 | | | | 1,793,422 | | | | 644,591 | | | | 198,205 | | | | 2,438,013 | | | | 2,636,218 | | | | 669,648 | | | 1978 | | 40 yrs. |
| 2800 Northwest Boulevard | | Plymouth, MN | | | — | | | | 1,934,438 | | | | 10,952,503 | | | | 484,440 | | | | 1,934,438 | | | | 11,436,943 | | | | 13,371,380 | | | | 2,695,022 | | | 1995 | | 40 yrs. |
| 9600 54th Avenue | | Plymouth, MN | | | — | | | | 332,317 | | | | 3,077,820 | | | | 1,075,534 | | | | 332,317 | | | | 4,153,354 | | | | 4,485,671 | | | | 931,060 | | | 1998 | | 40 yrs. |
| 1500 SW 5th Court | | Pompano Beach, FL | | | — | | | | 972,232 | | | | 3,892,085 | | | | 245,724 | | | | 972,232 | | | | 4,137,810 | | | | 5,110,041 | | | | 987,730 | | | 1957 | | 40 yrs. |
| 1651 SW 5th Court | | Pompano Beach, FL | | | — | | | | 203,247 | | | | 811,093 | | | | 126,108 | | | | 203,247 | | | | 937,202 | | | | 1,140,449 | | | | 283,351 | | | 1990 | | 40 yrs. |
| 1601 SW 5th Court | | Pompano Beach, FL | | | — | | | | 203,247 | | | | 811,093 | | | | 403,403 | | | | 203,247 | | | | 1,214,496 | | | | 1,417,743 | | | | 301,897 | | | 1990 | | 40 yrs. |
| 1501 SW 5th Court | | Pompano Beach, FL | | | — | | | | 203,247 | | | | 811,093 | | | | 40,396 | | | | 203,247 | | | | 851,489 | | | | 1,054,737 | | | | 204,419 | | | 1990 | | 40 yrs. |
| 1400 SW 6th Court | | Pompano Beach, FL | | | — | | | | 1,157,049 | | | | 4,620,956 | | | | 308,055 | | | | 1,157,049 | | | | 4,929,010 | | | | 6,086,060 | | | | 1,155,658 | | | 1986 | | 40 yrs. |
| 1405 SW 6th Court | | Pompano Beach, FL | | | — | | | | 392,138 | | | | 1,565,787 | | | | 126,972 | | | | 392,138 | | | | 1,692,759 | | | | 2,084,897 | | | | 403,837 | | | 1985 | | 40 yrs. |
| 595 SW 13th Terrace | | Pompano Beach, FL | | | — | | | | 359,933 | | | | 1,437,116 | | | | 95,541 | | | | 359,933 | | | | 1,532,657 | | | | 1,892,590 | | | | 356,011 | | | 1984 | | 40 yrs. |
| 601 SW 13th Terrace | | Pompano Beach, FL | | | — | | | | 164,413 | | | | 655,933 | | | | 151,781 | | | | 164,413 | | | | 807,714 | | | | 972,127 | | | | 184,683 | | | 1984 | | 40 yrs. |
| 605 SW 16th Terrace | | Pompano Beach, FL | | | — | | | | 310,778 | | | | 1,238,324 | | | | 307,582 | | | | 310,178 | | | | 1,546,507 | | | | 1,856,684 | | | | 319,660 | | | 1965 | | 40 yrs. |
| 4300 Carolina Avenue | | Richmond, VA | | | — | | | | 2,007,717 | | | | 14,927,608 | | | | 555,417 | | | | 2,009,136 | | | | 15,481,606 | | | | 17,490,742 | | | | 4,505,494 | | | 1985 | | 40 yrs. |
| 301 Hill Carter Parkway | | Richmond, VA | | | — | | | | 659,456 | | | | 4,836,010 | | | | 625 | | | | 659,456 | | | | 4,836,635 | | | | 5,496,091 | | | | 1,430,892 | | | 1989 | | 40 yrs. |
| 4001 Carolina Avenue | | Richmond, VA | | | — | | | | 29,443 | | | | 215,914 | | | | 305,691 | | | | 29,443 | | | | 521,605 | | | | 551,048 | | | | 122,714 | | | 1935 | | 40 yrs. |
| 5600-5626 Eastport Boulevard | | Richmond, VA | | | — | | | | 489,941 | | | | 3,592,900 | | | | 389,883 | | | | 489,941 | | | | 3,982,783 | | | | 4,472,724 | | | | 1,217,321 | | | 1989 | | 40 yrs. |
| 5650-5674 Eastport Boulevard | | Richmond, VA | | | — | | | | 644,384 | | | | 4,025,480 | | | | 235,079 | | | | 644,384 | | | | 4,260,559 | | | | 4,904,943 | | | | 1,393,734 | | | 1990 | | 40 yrs. |
| 5700 Eastport Boulevard | | Richmond, VA | | | — | | | | 408,729 | | | | 2,697,348 | | | | 803,670 | | | | 408,729 | | | | 3,501,018 | | | | 3,909,747 | | | | 984,143 | | | 1990 | | 40 yrs. |
| 4101-4127 Carolina Avenue | | Richmond, VA | | | — | | | | 310,854 | | | | 2,279,597 | | | | 567,636 | | | | 310,854 | | | | 2,847,233 | | | | 3,158,087 | | | | 768,190 | | | 1973 | | 40 yrs. |
| 4201-4261 Carolina Avenue | | Richmond, VA | | | — | | | | 693,203 | | | | 5,083,493 | | | | 1,305,385 | | | | 693,203 | | | | 6,388,878 | | | | 7,082,081 | | | | 1,911,966 | | | 1975 | | 40 yrs. |
| 4263-4299 Carolina Avenue | | Richmond, VA | | | — | | | | 256,203 | | | | 2,549,649 | | | | 1,647,276 | | | | 256,203 | | | | 4,196,925 | | | | 4,453,128 | | | | 1,163,759 | | | 1976 | | 40 yrs. |
| 4301-4335 Carolina Avenue | | Richmond, VA | | | — | | | | 223,696 | | | | 1,640,435 | | | | 1,920,216 | | | | 223,696 | | | | 3,560,651 | | | | 3,784,347 | | | | 546,076 | | | 1978 | | 40 yrs. |
| 4337-4379 Carolina Avenue | | Richmond, VA | | | — | | | | 325,303 | | | | 2,385,557 | | | | 880,278 | | | | 325,303 | | | | 3,265,835 | | | | 3,591,138 | | | | 1,282,851 | | | 1979 | | 40 yrs. |
| 4501-4549 Carolina Avenue | | Richmond, VA | | | — | | | | 486,166 | | | | 3,565,211 | | | | 471,129 | | | | 486,166 | | | | 4,036,340 | | | | 4,522,506 | | | | 1,177,796 | | | 1981 | | 40 yrs. |
| 4551-4593 Carolina Avenue | | Richmond, VA | | | — | | | | 474,360 | | | | 3,478,646 | | | | 272,695 | | | | 474,360 | | | | 3,751,341 | | | | 4,225,701 | | | | 1,087,264 | | | 1982 | | 40 yrs. |
| 4601-4643 Carolina Avenue | | Richmond, VA | | | — | | | | 652,455 | | | | 4,784,675 | | | | 507,154 | | | | 652,455 | | | | 5,291,829 | | | | 5,944,284 | | | | 1,738,991 | | | 1985 | | 40 yrs. |
| 4645-4683 Carolina Avenue | | Richmond, VA | | | — | | | | 404,616 | | | | 2,967,187 | | | | 1,079,890 | | | | 404,616 | | | | 4,047,077 | | | | 4,451,693 | | | | 1,760,935 | | | 1985 | | 40 yrs. |
| 4447-4491 Carolina Avenue | | Richmond, VA | | | — | | | | 454,056 | | | | 2,729,742 | | | | 293,897 | | | | 454,056 | | | | 3,023,639 | | | | 3,477,695 | | | | 958,366 | | | 1987 | | 40 yrs. |
| 4401-4445 Carolina Avenue | | Richmond, VA | | | — | | | | 615,038 | | | | 4,510,272 | | | | 397,983 | | | | 615,038 | | | | 4,908,255 | | | | 5,523,293 | | | | 1,459,049 | | | 1988 | | 40 yrs. |
| 2300 East Parham Road | | Richmond, VA | | | — | | | | 221,947 | | | | 1,011,088 | | | | 2,443 | | | | 221,947 | | | | 1,013,531 | | | | 1,235,478 | | | | 325,610 | | | 1988 | | 40 yrs. |
| 5601-5659 Eastport Boulevard | | Richmond, VA | | | * | | | | 705,660 | | | | — | | | | 4,718,370 | | | | 720,100 | | | | 4,703,930 | | | | 5,424,030 | | | | 1,653,017 | | | 1996 | | 40 yrs. |
| 5900 Eastport Boulevard | | Richmond, VA | | | — | | | | 676,661 | | | | — | | | | 4,818,232 | | | | 687,898 | | | | 4,806,995 | | | | 5,494,893 | | | | 1,265,045 | | | 1997 | | 40 yrs. |
| 4717-4729 Eubank Road | | Richmond, VA | | | * | | | | 449,447 | | | | 3,294,697 | | | | 546,131 | | | | 452,263 | | | | 3,838,011 | | | | 4,290,274 | | | | 1,127,629 | | | 1978 | | 40 yrs. |
| 4263F-N. Carolina Avenue | | Richmond, VA | | | — | | | | 91,476 | | | | — | | | | 1,643,294 | | | | 91,599 | | | | 1,643,171 | | | | 1,734,770 | | | | 446,236 | | | 1975 | | 40 yrs. |
| 510 Eastpark Court | | Richmond, VA | | | — | | | | 261,961 | | | | 2,110,874 | | | | 316,688 | | | | 262,210 | | | | 2,427,312 | | | | 2,689,523 | | | | 800,917 | | | 1989 | | 40 yrs. |
| 520 Eastpark Court | | Richmond, VA | | | — | | | | 486,118 | | | | 4,083,582 | | | | 336,701 | | | | 486,598 | | | | 4,419,803 | | | | 4,906,401 | | | | 1,203,497 | | | 1989 | | 40 yrs. |
| 5701-5799 Eastport Boulevard | | Richmond, VA | | | — | | | | 694,644 | | | | — | | | | 5,651,198 | | | | 700,503 | | | | 5,645,340 | | | | 6,345,842 | | | | 1,630,865 | | | 1998 | | 40 yrs. |
| 530 Eastpark Court | | Richmond, VA | | | — | | | | 266,883 | | | | — | | | | 3,068,901 | | | | 334,772 | | | | 3,001,012 | | | | 3,335,784 | | | | 1,026,669 | | | 1999 | | 40 yrs. |
| 3829-3855 Gaskins Road | | Richmond, VA | | | — | | | | 364,165 | | | | 3,264,114 | | | | 39,764 | | | | 364,165 | | | | 3,303,879 | | | | 3,668,044 | | | | 728,169 | | | 1988 | | 40 yrs. |
| 10800 Nuckols Boulevard | | Richmond, VA | | | — | | | | 1,432,462 | | | | — | | | | 14,420,839 | | | | 1,794,162 | | | | 14,059,139 | | | | 15,853,301 | | | | 2,428,731 | | | 2000 | | 40 yrs. |
| 100 Westgate Parkway | | Richmond, VA | | | — | | | | 1,140,648 | | | | 101,824 | | | | 8,408,649 | | | | 1,456,084 | | | | 8,195,037 | | | | 9,651,121 | | | | 1,230,590 | | | 2001 | | 40 yrs. |
| 200 Westgate Parkway | | Richmond, VA | | | — | | | | 1,623,612 | | | | — | | | | 5,900,380 | | | | 1,072,797 | | | | 6,451,195 | | | | 7,523,992 | | | | 923,936 | | | 2002 | | 40 yrs. |
| 1001 Boulders Parkway | | Richmond, VA | | | — | | | | 2,073,739 | | | | 5,634,796 | | | | 892,592 | | | | 2,079,643 | | | | 6,521,484 | | | | 8,601,127 | | | | 257,425 | | | 2005 | | 40 yrs. |
| 7400 Beaufont Springs Drive | | Richmond, VA | | | — | | | | 808,581 | | | | 7,273,850 | | | | 837,566 | | | | 810,743 | | | | 8,109,253 | | | | 8,919,996 | | | | 304,103 | | | 2005 | | 40 yrs. |
| 1100 Boulders Parkway | | Richmond, VA | | | — | | | | 1,276,936 | | | | 12,052,192 | | | | 709,835 | | | | 1,280,662 | | | | 12,758,301 | | | | 14,038,963 | | | | 181,763 | | | 2005 | | 40 yrs. |
102
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12 S. Third Street | | Richmond, VA | | | — | | | | 40,539 | | | | 184,682 | | | | 14,061 | | | | 40,539 | | | | 198,743 | | | | 239,282 | | | | 57,182 | | | 1900 | | 40 yrs. |
| 2020 US Highway 301 South | | Riverview, FL | | | — | | | | 1,233,639 | | | | 13,608,485 | | | | 1,144 | | | | 1,233,800 | | | | 13,609,469 | | | | 14,843,268 | | | | 158,254 | | | 2006 | | 40 yrs. |
| 6532 Judge Adams Road | | Rock Creek, NC | | | — | | | | 354,903 | | | | — | | | | 3,740,561 | | | | 399,988 | | | | 3,695,477 | | | | 4,095,464 | | | | 996,239 | | | 1997 | | 40 yrs. |
| 6530 Judge Adams Road | | Rock Creek, NC | | | — | | | | 305,821 | | | | — | | | | 4,458,256 | | | | 335,061 | | | | 4,429,015 | | | | 4,764,076 | | | | 903,045 | | | 1999 | | 40 yrs. |
| 6509 Franz Warner Parkway | | Rock Creek, NC | | | — | | | | 360,494 | | | | — | | | | 2,829,679 | | | | 372,494 | | | | 2,817,679 | | | | 3,190,173 | | | | 506,475 | | | 2001 | | 40 yrs. |
| 38100 Ecorse Road | | Romulus, MI | | | — | | | | 955,063 | | | | — | | | | 8,900,259 | | | | 853,063 | | | | 9,002,259 | | | | 9,855,322 | | | | 1,360,828 | | | 2000 | | 40 yrs. |
| 38000 Ecourse Road | | Romulus, MI | | | — | | | | 807,660 | | | | — | | | | 12,732,352 | | | | 1,053,337 | | | | 12,486,675 | | | | 13,540,012 | | | | 2,529,890 | | | 2001 | | 40 yrs. |
| 6505 Cogswell Road | | Romulus, MI | | | — | | | | 594,523 | | | | — | | | | 17,282,074 | | | | 4,195,047 | | | | 13,681,551 | | | | 17,876,598 | | | | 2,078 | | | 2005 | | 40 yrs. |
| 38100 Ecorse Road Expansion | | Romulus, MI | | | — | | | | — | | | | — | | | | 1,538,262 | | | | — | | | | 1,538,262 | | | | 1,538,262 | | | | 28,999 | | | 2005 | | 40 yrs. |
| 8501 East Raintree Drive | | Scottsdale, AZ | | | — | | | | 4,076,412 | | | | — | | | | 27,576,974 | | | | 4,115,137 | | | | 27,538,249 | | | | 31,653,386 | | | | 459,720 | | | 2005 | | 40 yrs. |
| 26911-26957 Northwestern Highway | | Southfield, MI | | | — | | | | 7,799,515 | | | | 66,268,817 | | | | 8,771,128 | | | | 7,799,515 | | | | 75,039,945 | | | | 82,839,460 | | | | 18,643,965 | | | 1985 | | 40 yrs. |
| 6950 Harbor View Blvd | | Suffolk, VA | | | — | | | | 929,844 | | | | — | | | | 6,197,285 | | | | 794,848 | | | | 6,332,282 | | | | 7,127,129 | | | | 96,284 | | | 2004 | | 40 yrs. |
| 13650 NW 8th Street | | Sunrise, FL | | | — | | | | 558,223 | | | | 2,171,930 | | | | 99,234 | | | | 558,251 | | | | 2,271,136 | | | | 2,829,387 | | | | 624,170 | | | 1991 | | 40 yrs. |
| 13630 NW 8th Street | | Sunrise, FL | | | — | | | | 659,797 | | | | 2,596,275 | | | | 772,671 | | | | 659,825 | | | | 3,368,917 | | | | 4,028,742 | | | | 883,443 | | | 1991 | | 40 yrs. |
| 1301 International Parkway | | Sunrise, FL | | | — | | | | 5,100,162 | | | | 24,219,956 | | | | 1,264,535 | | | | 5,100,791 | | | | 25,483,861 | | | | 30,584,653 | | | | — | | | 2006 | | 40 yrs. |
| 5501-5519 Pioneer Park Boulevard | | Tampa, FL | | | — | | | | 162,000 | | | | 1,613,000 | | | | 637,115 | | | | 262,416 | | | | 2,149,700 | | | | 2,412,115 | | | | 605,615 | | | 1981 | | 40 yrs. |
| 5690-5694 Crenshaw Street | | Tampa, FL | | | — | | | | 181,923 | | | | 1,812,496 | | | | 217,470 | | | | 181,923 | | | | 2,029,967 | | | | 2,211,890 | | | | 598,290 | | | 1979 | | 40 yrs. |
| 3102,3104,3110 Cherry Palm Drive | | Tampa, FL | | | — | | | | 503,767 | | | | 2,787,585 | | | | 1,948,416 | | | | 982,207 | | | | 4,257,561 | | | | 5,239,768 | | | | 1,234,238 | | | 1986 | | 40 yrs. |
| 8401-8408 Benjamin Road | | Tampa, FL | | | — | | | | 789,651 | | | | 4,454,648 | | | | 1,974,397 | | | | 769,789 | | | | 6,448,907 | | | | 7,218,696 | | | | 2,203,217 | | | 1986 | | 40 yrs. |
| 3501 Riga Boulevard | | Tampa, FL | | | — | | | | 617,289 | | | | 3,048,379 | | | | 454,271 | | | | 617,289 | | | | 3,502,650 | | | | 4,119,939 | | | | 1,026,027 | | | 1987 | | 40 yrs. |
| 111 Kelsey Lane | | Tampa, FL | | | — | | | | 359,540 | | | | 1,461,850 | | | | 934,298 | | | | 359,540 | | | | 2,396,148 | | | | 2,755,688 | | | | 729,735 | | | 1990 | | 40 yrs. |
| 7930, 8010-20 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 1,408,478 | | | | 5,247,246 | | | | 911,481 | | | | 1,408,478 | | | | 6,158,727 | | | | 7,567,205 | | | | 1,671,637 | | | 1990 | | 40 yrs. |
| 7920 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 1,382,648 | | | | 2,445,444 | | | | (276,436 | ) | | | 1,082,648 | | | | 2,469,008 | | | | 3,551,656 | | | | 607,836 | | | 1997 | | 40 yrs. |
| 8154-8198 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 399,088 | | | | 2,868,834 | | | | 441,572 | | | | 399,088 | | | | 3,310,406 | | | | 3,709,494 | | | | 967,807 | | | 1988 | | 40 yrs. |
| 8112-42 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 513,263 | | | | 3,230,239 | | | | 662,940 | | | | 513,263 | | | | 3,893,180 | | | | 4,406,442 | | | | 889,518 | | | 1995 | | 40 yrs. |
| 8212 Woodland Center Boulevard | | Tampa, FL | | | * | | | | 820,882 | | | | 2,322,720 | | | | 14,210 | | | | 820,882 | | | | 2,336,931 | | | | 3,157,813 | | | | 563,816 | | | 1996 | | 40 yrs. |
| 131 Kelsey Lane | | Tampa, FL | | | — | | | | 511,463 | | | | — | | | | 4,455,291 | | | | 559,527 | | | | 4,407,227 | | | | 4,966,754 | | | | 1,699,463 | | | 1985 | | 40 yrs. |
| 7724 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 235,893 | | | | — | | | | 2,285,235 | | | | 235,894 | | | | 2,285,234 | | | | 2,521,128 | | | | 611,383 | | | 1998 | | 40 yrs. |
| 7802-50 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 357,364 | | | | — | | | | 2,711,761 | | | | 506,949 | | | | 2,562,177 | | | | 3,069,125 | | | | 1,019,925 | | | 1999 | | 40 yrs. |
| 7852-98 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 357,364 | | | | — | | | | 2,708,532 | | | | 506,949 | | | | 2,558,947 | | | | 3,065,896 | | | | 965,711 | | | 1999 | | 40 yrs. |
| 8921 Brittany Way | | Tampa, FL | | | — | | | | 224,369 | | | | 1,063,882 | | | | 965,576 | | | | 254,493 | | | | 1,999,334 | | | | 2,253,827 | | | | 446,634 | | | 1998 | | 40 yrs. |
| 5250 Eagle Trail Drive | | Tampa, FL | | | — | | | | 952,860 | | | | — | | | | 3,581,057 | | | | 952,860 | | | | 3,581,057 | | | | 4,533,916 | | | | 739,406 | | | 1998 | | 40 yrs. |
| 7725 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 553,335 | | | | — | | | | 3,351,584 | | | | 771,501 | | | | 3,133,418 | | | | 3,904,919 | | | | 637,170 | | | 1999 | | 40 yrs. |
| 8001 Woodland Center Boulevard | | Tampa, FL | | | — | | | | 350,406 | | | | — | | | | 2,488,771 | | | | 438,061 | | | | 2,401,117 | | | | 2,839,178 | | | | 517,144 | | | 1999 | | 40 yrs. |
| 4630 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | 943,169 | | | | — | | | | 12,592,708 | | | | 1,560,099 | | | | 11,975,778 | | | | 13,535,877 | | | | 2,279,782 | | | 2000 | | 40 yrs. |
| 701-725 South US Hwy 301 | | Tampa, FL | | | — | | | | 419,683 | | | | — | | | | 3,817,508 | | | | 661,680 | | | | 3,575,511 | | | | 4,237,191 | | | | 1,130,146 | | | 2000 | | 40 yrs. |
| 4502 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | — | | | | — | | | | 4,005,900 | | | | 1,071,535 | | | | 2,934,365 | | | | 4,005,900 | | | | 528,300 | | | 1999 | | 40 yrs. |
| 9001-9015 Brittany Way | | Tampa, FL | | | — | | | | 209,841 | | | | — | | | | 1,575,906 | | | | 364,514 | | | | 1,421,234 | | | | 1,785,748 | | | | 334,370 | | | 2000 | | 40 yrs. |
| 4508 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | 498,598 | | | | — | | | | 3,057,752 | | | | 556,887 | | | | 2,999,463 | | | | 3,556,350 | | | | 573,747 | | | 2000 | | 40 yrs. |
| 7622 Bald Cypress Place | | Tampa, FL | | | — | | | | — | | | | — | | | | 1,305,584 | | | | 300,000 | | | | 1,005,584 | | | | 1,305,584 | | | | 171,340 | | | 2000 | | 40 yrs. |
| 901-933 US Highway 301 South | | Tampa, FL | | | — | | | | 500,391 | | | | — | | | | 4,032,028 | | | | 840,314 | | | | 3,692,105 | | | | 4,532,419 | | | | 978,648 | | | 2001 | | 40 yrs. |
| 4503 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | — | | | | — | | | | 3,454,328 | | | | 619,913 | | | | 2,834,415 | | | | 3,454,328 | | | | 414,660 | | | 2002 | | 40 yrs. |
| 4505 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | — | | | | — | | | | 3,110,391 | | | | 716,594 | | | | 2,393,797 | | | | 3,110,391 | | | | 528,279 | | | 2002 | | 40 yrs. |
| 4511 Woodland Corporate Boulevard | | Tampa, FL | | | — | | | | — | | | | — | | | | 2,840,466 | | | | 686,594 | | | | 2,153,872 | | | | 2,840,466 | | | | 386,162 | | | 2002 | | 40 yrs. |
| 7621 Bald Cypress Place (Bldg N) | | Tampa, FL | | | — | | | | — | | | | — | | | | 1,482,613 | | | | 447,498 | | | | 1,035,115 | | | | 1,482,613 | | | | 121,194 | | | 2001 | | 40 yrs. |
| 4520 Seedling Circle | | Tampa, FL | | | — | | | | 854,797 | | | | 42,131 | | | | 2,721,233 | | | | 854,797 | | | | 2,763,364 | | | | 3,618,161 | | | | 185,881 | | | 2003 | | 40 yrs. |
| 501 US Highway 301 South | | Tampa, FL | | | — | | | | 898,884 | | | | — | | | | 3,499,853 | | | | 900,508 | | | | 3,498,229 | | | | 4,398,737 | | | | 261,909 | | | 2004 | | 40 yrs. |
| 9002-9036 Brittany Way | | Tampa, FL | | | — | | | | 492,320 | | | | — | | | | 3,964,055 | | | | 899,284 | | | | 3,557,092 | | | | 4,456,375 | | | | 343,327 | | | 2004 | | 40 yrs. |
| 8900-34 Brittany Was | | Tampa, FL | | | — | | | | 537,194 | | | | — | | | | 4,248,195 | | | | 978,019 | | | | 3,807,371 | | | | 4,785,389 | | | | 14,913 | | | 2005 | | 40 yrs. |
| 200-34 Kelsey Lane | | Tampa, FL | | | — | | | | 330,097 | | | | — | | | | 3,623,009 | | | | 933,362 | | | | 3,019,744 | | | | 3,953,106 | | | | 90,303 | | | 2005 | | 40 yrs. |
| 8725 Henderson Road | | Tampa, FL | | | — | | | | 3,171,906 | | | | 19,126,156 | | | | (3,957 | ) | | | 3,167,787 | | | | 19,126,318 | | | | 22,294,105 | | | | 162,502 | | | 2006 | | 40 yrs. |
| 8735 Henderson Road | | Tampa, FL | | | — | | | | 3,170,247 | | | | 18,749,873 | | | | (18,416 | ) | | | 3,166,130 | | | | 18,735,573 | | | | 21,901,703 | | | | 160,241 | | | 2006 | | 40 yrs. |
| 8705 Henderson Road | | Tampa, FL | | | — | | | | 4,309,467 | | | | 23,688,189 | | | | 21,765 | | | | 4,303,870 | | | | 23,715,550 | | | | 28,019,421 | | | | 299,401 | | | 2006 | | 40 yrs. |
| 8715 Henderson Road | | Tampa, FL | | | — | | | | 3,348,258 | | | | 18,325,427 | | | | (4,177 | ) | | | 3,343,910 | | | | 18,325,599 | | | | 21,669,509 | | | | 133,957 | | | 2006 | | 40 yrs. |
| 8745 Henderson Road | | Tampa, FL | | | — | | | | 2,053,105 | | | | 11,158,441 | | | | 11,901 | | | | 2,050,439 | | | | 11,173,008 | | | | 13,223,447 | | | | 95,859 | | | 2006 | | 40 yrs. |
| 7851-7861 Woodland Center Blvd | | Tampa, FL | | | — | | | | 549,043 | | | | 2,242,204 | | | | 95,559 | | | | 548,905 | | | | 2,337,901 | | | | 2,886,806 | | | | 17,050 | | | 2006 | | 40 yrs. |
| 1650 Research Drive | | Troy, MI | | | — | | | | 763,067 | | | | 7,201,677 | | | | 1,328,964 | | | | 763,067 | | | | 8,530,641 | | | | 9,293,708 | | | | 1,885,343 | | | 1985 | | 40 yrs. |
| 1775 Research Drive | | Troy, MI | | | — | | | | 331,422 | | | | 2,788,073 | | | | 648,020 | | | | 331,422 | | | | 3,436,093 | | | | 3,767,515 | | | | 789,861 | | | 1985 | | 40 yrs. |
| 1875 Research Drive | | Troy, MI | | | — | | | | 329,863 | | | | 2,774,006 | | | | 378,366 | | | | 329,863 | | | | 3,152,372 | | | | 3,482,235 | | | | 747,631 | | | 1986 | | 40 yrs. |
| 1850 Research Drive | | Troy, MI | | | — | | | | 781,054 | | | | 7,364,300 | | | | 2,083,387 | | | | 781,054 | | | | 9,447,687 | | | | 10,228,741 | | | | 2,340,733 | | | 1986 | | 40 yrs. |
| 1965 Research Drive | | Troy, MI | | | — | | | | 419,090 | | | | 3,578,928 | | | | 346,058 | | | | 419,090 | | | | 3,924,986 | | | | 4,344,077 | | | | 1,054,465 | | | 1987 | | 40 yrs. |
| 1960 Research Drive | | Troy, MI | | | — | | | | 419,146 | | | | 3,579,166 | | | | 635,418 | | | | 419,146 | | | | 4,214,584 | | | | 4,633,730 | | | | 1,115,137 | | | 1987 | | 40 yrs. |
| 1101 Allen Drive | | Troy, MI | | | — | | | | 98,144 | | | | 887,935 | | | | 326,837 | | | | 98,148 | | | | 1,214,768 | | | | 1,312,916 | | | | 450,766 | | | 1974 | | 40 yrs. |
103
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | | | | | | | | | | | | | Date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (Years) |
| OPERATING PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 1151 Allen Drive | | Troy, MI | | | — | | | | 164,483 | | | | 1,486,220 | | | | 438,250 | | | | 164,486 | | | | 1,924,467 | | | | 2,088,953 | | | | 529,177 | | | 1974 | | 40 yrs. |
| 1300 Rankin Street | | Troy, MI | | | — | | | | 134,090 | | | | 1,212,752 | | | | 498,931 | | | | 134,094 | | | | 1,711,679 | | | | 1,845,773 | | | | 632,783 | | | 1979 | | 40 yrs. |
| 1350 Rankin Street | | Troy, MI | | | — | | | | 111,776 | | | | 1,011,497 | | | | 168,477 | | | | 111,779 | | | | 1,179,971 | | | | 1,291,750 | | | | 298,176 | | | 1979 | | 40 yrs. |
| 1376-1400 Rankin Street | | Troy, MI | | | — | | | | 134,292 | | | | 1,213,626 | | | | 313,374 | | | | 134,296 | | | | 1,526,996 | | | | 1,661,292 | | | | 384,503 | | | 1979 | | 40 yrs. |
| 1352-1374 Rankin Street | | Troy, MI | | | — | | | | 153,275 | | | | 1,385,098 | | | | 336,226 | | | | 153,279 | | | | 1,721,321 | | | | 1,874,599 | | | | 463,034 | | | 1979 | | 40 yrs. |
| 1324-1346 Rankin Street | | Troy, MI | | | — | | | | 134,090 | | | | 1,212,214 | | | | 161,394 | | | | 134,094 | | | | 1,373,604 | | | | 1,507,698 | | | | 313,707 | | | 1979 | | 40 yrs. |
| 1301-1307 Rankin Street | | Troy, MI | | | — | | | | 111,776 | | | | 1,011,121 | | | | 183,667 | | | | 111,779 | | | | 1,194,785 | | | | 1,306,564 | | | | 284,538 | | | 1978 | | 40 yrs. |
| 1409 Allen Drive | | Troy, MI | | | — | | | | 142,370 | | | | 1,286,048 | | | | 430,773 | | | | 142,374 | | | | 1,716,818 | | | | 1,859,191 | | | | 479,131 | | | 1978 | | 40 yrs. |
| 1334 Maplelawn Road | | Troy, MI | | | — | | | | 124,296 | | | | 1,122,802 | | | | 54,070 | | | | 124,300 | | | | 1,176,868 | | | | 1,301,168 | | | | 275,534 | | | 1983 | | 40 yrs. |
| 1290 Maplelawn Road | | Troy, MI | | | — | | | | 85,321 | | | | 771,621 | | | | 223,628 | | | | 85,325 | | | | 995,245 | | | | 1,080,570 | | | | 231,123 | | | 1984 | | 40 yrs. |
| 1070 Maplelawn Road | | Troy, MI | | | — | | | | 68,560 | | | | 620,595 | | | | 106,856 | | | | 68,563 | | | | 727,447 | | | | 796,011 | | | | 189,305 | | | 1982 | | 40 yrs. |
| 950 Maplelawn Road | | Troy, MI | | | — | | | | 252,429 | | | | 2,265,259 | | | | 181,631 | | | | 252,433 | | | | 2,446,886 | | | | 2,699,319 | | | | 596,700 | | | 1982 | | 40 yrs. |
| 894 Maplelawn Road | | Troy, MI | | | — | | | | 181,749 | | | | 1,632,243 | | | | 763,375 | | | | 181,753 | | | | 2,395,615 | | | | 2,577,367 | | | | 698,188 | | | 1986 | | 40 yrs. |
| 1311-1331 Maplelawn Road | | Troy, MI | | | — | | | | 125,407 | | | | 1,132,810 | | | | 204,037 | | | | 125,410 | | | | 1,336,843 | | | | 1,462,254 | | | | 421,557 | | | 1986 | | 40 yrs. |
| 2354 Bellingham Street | | Troy, MI | | | — | | | | 87,340 | | | | 789,817 | | | | 19,928 | | | | 87,344 | | | | 809,741 | | | | 897,085 | | | | 191,097 | | | 1990 | | 40 yrs. |
| 2360 Bellingham Street | | Troy, MI | | | — | | | | 87,340 | | | | 789,817 | | | | 58,250 | | | | 87,344 | | | | 848,063 | | | | 935,407 | | | | 194,192 | | | 1985 | | 40 yrs. |
| 1600-1630 East Big Beaver Road | | Troy, MI | | | — | | | | 1,454,406 | | | | 2,952,884 | | | | 53,694 | | | | 1,458,737 | | | | 3,002,247 | | | | 4,460,984 | | | | 537,518 | | | 1982 | | 40 yrs. |
| 2600 Bellingham Drive | | Troy, MI | | | — | | | | 1,796,869 | | | | — | | | | 4,095,318 | | | | 1,938,746 | | | | 3,953,441 | | | | 5,892,187 | | | | 1,107,377 | | | 2002 | | 40 yrs. |
| 2710 Bellingham Drive | | Troy, MI | | | — | | | | 1,796,869 | | | | — | | | | 4,721,835 | | | | 1,938,746 | | | | 4,579,958 | | | | 6,518,704 | | | | 1,253,476 | | | 2002 | | 40 yrs. |
| 3432 Holland Road | | Virginia Beach, VA | | | — | | | | 173,527 | | | | 790,515 | | | | 2,462 | | | | 173,527 | | | | 792,977 | | | | 966,504 | | | | 234,111 | | | 1989 | | 40 yrs. |
| 2809 South Lynnhaven Road | | Virginia Beach, VA | | | — | | | | 953,590 | | | | 6,142,742 | | | | 1,100,609 | | | | 953,590 | | | | 7,243,352 | | | | 8,196,941 | | | | 1,822,981 | | | 1987 | | 40 yrs. |
| 200 Golden Oak Court | | Virginia Beach, VA | | | — | | | | 1,116,693 | | | | 6,770,480 | | | | 1,126,390 | | | | 1,116,693 | | | | 7,896,870 | | | | 9,013,562 | | | | 2,005,654 | | | 1988 | | 40 yrs. |
| 208 Golden Oak Court | | Virginia Beach, VA | | | — | | | | 965,177 | | | | 6,728,717 | | | | 1,129,993 | | | | 965,177 | | | | 7,858,710 | | | | 8,823,888 | | | | 2,052,497 | | | 1989 | | 40 yrs. |
| 484 Viking Drive | | Virginia Beach, VA | | | — | | | | 891,753 | | | | 3,607,890 | | | | 553,685 | | | | 891,753 | | | | 4,161,575 | | | | 5,053,327 | | | | 1,028,787 | | | 1987 | | 40 yrs. |
| 629 Phoenix Drive | | Virginia Beach, VA | | | — | | | | 371,694 | | | | 2,108,097 | | | | 243,169 | | | | 371,694 | | | | 2,351,266 | | | | 2,722,960 | | | | 559,043 | | | 1996 | | 40 yrs. |
| 5700 Cleveland Street | | Virginia Beach, VA | | | — | | | | 700,112 | | | | 9,592,721 | | | | 1,917,901 | | | | 700,564 | | | | 11,510,169 | | | | 12,210,734 | | | | 3,008,461 | | | 1989 | | 40 yrs. |
| 1457 Miller Store Road | | Virginia Beach, VA | | | 1,587,598 | | | | 473,689 | | | | 2,663,045 | | | | 603,352 | | | | 474,746 | | | | 3,265,341 | | | | 3,740,086 | | | | 285,752 | | | 2003 | | 40 yrs. |
| 11020 West Plank Court | | Wauwatosa, WI | | | — | | | | 464,246 | | | | 3,230,511 | | | | (519,943 | ) | | | 464,246 | | | | 2,710,568 | | | | 3,174,814 | | | | 533,083 | | | 1985 | | 40 yrs. |
| 825 Duportail Road | | Wayne, PA | | | — | | | | 5,536,619 | | | | 16,179,213 | | | | 1,061,808 | | | | 5,539,281 | | | | 17,238,360 | | | | 22,777,641 | | | | 2,848,284 | | | 1979 | | 40 yrs. |
| 1500 Liberty Ridge | | Wayne, PA | | | — | | | | 8,287,555 | | | | — | | | | 31,280,987 | | | | 11,636,499 | | | | 27,932,043 | | | | 39,568,542 | | | | 4,177,639 | | | 2002 | | 40 yrs. |
| 1200 Liberty Ridge Drive | | Wayne, PA | | | — | | | | 6,215,667 | | | | — | | | | 8,829,577 | | | | 5,223,660 | | | | 9,821,584 | | | | 15,045,244 | | | | 2,393,281 | | | 2001 | | 40 yrs. |
| 11300-90 West Theodore Trecker Way | | West Allis, WI | | | * | | | | 500,565 | | | | 1,591,678 | | | | 630,627 | | | | 505,972 | | | | 2,216,897 | | | | 2,722,870 | | | | 48,651 | | | 2005 | | 40 yrs. |
| 11548 West Theodore Trecker Way | | West Allis, WI | | | * | | | | 660,068 | | | | 4,640,578 | | | | 44,656 | | | | 663,766 | | | | 4,681,537 | | | | 5,345,302 | | | | 181,960 | | | 2005 | | 40 yrs. |
| 11420 West Theodore Trecker Way | | West Allis, WI | | | — | | | | 348,146 | | | | 2,057,483 | | | | 27,202 | | | | 350,008 | | | | 2,082,824 | | | | 2,432,831 | | | | 80,727 | | | 2005 | | 40 yrs. |
| 400-500 Brandywine Parkway | | West Chester, PA | | | — | | | | 845,846 | | | | 6,809,025 | | | | 453,832 | | | | 845,846 | | | | 7,262,857 | | | | 8,108,703 | | | | 1,742,042 | | | 1988 | | 40 yrs. |
| 600 Brandywine Parkway | | West Chester, PA | | | — | | | | 664,899 | | | | 5,352,410 | | | | 842,826 | | | | 664,899 | | | | 6,195,236 | | | | 6,860,135 | | | | 1,575,945 | | | 1988 | | 40 yrs. |
| 905 Airport Road | | West Chester, PA | | | — | | | | 1,715,000 | | | | 5,185,000 | | | | 1,429,527 | | | | 1,735,012 | | | | 6,594,515 | | | | 8,329,527 | | | | 2,301,424 | | | 1988 | | 40 yrs. |
| Liberty Square Retail Blocks | | West Malling, UK | | | — | | | | 559,590 | | | | 5,113,902 | | | | 5,761,846 | | | | 1,408,957 | | | | 10,026,381 | | | | 11,435,338 | | | | 346,459 | | | 2006 | | 40 yrs. |
| 3612 La Grange Parkway | | Williamsburg, VA | | | — | | | | — | | | | — | | | | 5,687,985 | | | | 887,234 | | | | 4,800,752 | | | | 5,687,985 | | | | 284,122 | | | 2003 | | 40 yrs. |
| 7805 Hudson Road | | Woodbury, MN | | | — | | | | 1,279,834 | | | | — | | | | 10,337,053 | | | | 1,385,739 | | | | 10,231,149 | | | | 11,616,887 | | | | 1,940,761 | | | 2002 | | 40 yrs. |
| | | | | | | | | |
| Subtotal Operating Real Estate | | | | $ | 92,401,473 | | | $ | 618,631,316 | | | $ | 1,812,183,416 | | | $ | 2,061,697,505 | | | $ | 678,074,971 | | | $ | 3,814,437,267 | | | $ | 4,492,512,238 | | | $ | 806,308,940 | | | | | |
| | | | | | | | | |
104
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End of Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (years) |
| DEVELOPMENT PROPERTIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 8400 Industrial Boulevard | | Allentown, PA | | $ | — | | | $ | 6,883,389 | | | $ | — | | | $ | 25,444,359 | | | $ | — | | | $ | 32,327,747 | | | $ | 32,327,747 | | | $ | — | | | 2005 | | N/A |
| 3500 High Point Boulevard | | Bethlehem, PA | | | — | | | | 289,529 | | | | — | | | | 2,143,128 | | | | — | | | | 2,432,657 | | | | 2,432,657 | | | | — | | | 2006 | | N/A |
| 3450 High Point Boulevard | | Bethlehem, PA | | | — | | | | 303,197 | | | | — | | | | 1,897,360 | | | | — | | | | 2,200,557 | | | | 2,200,557 | | | | — | | | 2006 | | N/A |
| 5705 Old Shakopee Road | | Bloomington, MN | | | — | | | | 2,113,223 | | | | — | | | | 1,409,514 | | | | — | | | | 3,522,737 | | | | 3,522,737 | | | | — | | | 2001 | | N/A |
| 8201 Industrial Boulevard | | Breinigsville, PA | | | — | | | | 2,138,635 | | | | — | | | | 887,619 | | | | — | | | | 3,026,254 | | | | 3,026,254 | | | | — | | | 2006 | | N/A |
| 6220 Old Dobbin Lane | | Columbis, MD | | | — | | | | 3,865,848 | | | | — | | | | 3,117,313 | | | | — | | | | 6,983,161 | | | | 6,983,161 | | | | — | | | 2006 | | N/A |
| 7625 Smetana Lane | | Eden Prairie, MN | | | — | | | | 4,500,641 | | | | — | | | | 1,416,645 | | | | — | | | | 5,917,287 | | | | 5,917,287 | | | | — | | | 2006 | | N/A |
| 7351 Coca Cola Drive | | Elkridge, MD | | | — | | | | 1,897,044 | | | | — | | | | 4,722,406 | | | | — | | | | 6,619,450 | | | | 6,619,450 | | | | — | | | 2006 | | N/A |
| 1100 Virginia Drive | | Fort Washington, PA | | | — | | | | 22,612,437 | | | | — | | | | 18,251,084 | | | | — | | | | 40,863,521 | | | | 40,863,521 | | | | — | | | 2006 | | N/A |
| 7 Independence Pointe | | Greenville, SC | | | — | | | | 932,484 | | | | — | | | | 4,353,296 | | | | — | | | | 5,285,780 | | | | 5,285,780 | | | | — | | | 2006 | | N/A |
| 45 Brookfield Oaks Drive | | Greenville, SC | | | — | | | | 818,114 | | | | — | | | | 3,151,403 | | | | — | | | | 3,969,517 | | | | 3,969,517 | | | | — | | | 2006 | | N/A |
| 116 Pleasant Ridge Road | | Greenville, SC | | | — | | | | 1,547,811 | | | | — | | | | 2,740,234 | | | | — | | | | 4,288,045 | | | | 4,288,045 | | | | — | | | 2006 | | N/A |
| 1317 Executive Boulevard | | Hampton, VA | | | — | | | | 1,650,423 | | | | — | | | | 5,221,412 | | | | — | | | | 6,871,836 | | | | 6,871,836 | | | | — | | | 2006 | | N/A |
| 600 Industrial Drive | | Harrisburg, PA | | | — | | | | 7,743,800 | | | | — | | | | 24,665,626 | | | | — | | | | 32,409,426 | | | | 32,409,426 | | | | — | | | 2005 | | N/A |
| 1498 Eagle Hill Drive | | High Point, NC | | | — | | | | 94,274 | | | | — | | | | 5,688,012 | | | | — | | | | 5,782,285 | | | | 5,782,285 | | | | — | | | 2005 | | N/A |
| 4475 Premier Drive | | High Point, NC | | | — | | | | 748,693 | | | | — | | | | 3,600,826 | | | | — | | | | 4,349,519 | | | | 4,349,519 | | | | — | | | 2006 | | N/A |
| 7 Walnut Grove Drive | | Horsham, PA | | | — | | | | 2,631,696 | | | | — | | | | 9,130,339 | | | | — | | | | 11,762,035 | | | | 11,762,035 | | | | — | | | 2006 | | N/A |
| 1646 Rankin Road | | Houston, TX | | | — | | | | 329,961 | | | | — | | | | 4,049,825 | | | | — | | | | 4,379,785 | | | | 4,379,785 | | | | — | | | 2005 | | N/A |
| 330 Fellowship Road | | Mount Laurel, NJ | | | — | | | | 3,730,570 | | | | — | | | | 3,786,447 | | | | — | | | | 7,517,017 | | | | 7,517,017 | | | | — | | | 2006 | | N/A |
| 6923 Lee Vista Boulevard | | Orlando, FL | | | — | | | | 903,701 | | | | — | | | | 2,132,401 | | | | — | | | | 3,036,102 | | | | 3,036,102 | | | | — | | | 2006 | | N/A |
| 851 Gills Drive | | Orlando, FL | | | — | | | | 267,313 | | | | — | | | | 305,523 | | | | — | | | | 572,836 | | | | 572,836 | | | | — | | | 2006 | | N/A |
| 950 Gills Drive | | Orlando, FL | | | — | | | | 356,418 | | | | — | | | | 269,750 | | | | — | | | | 626,167 | | | | 626,167 | | | | — | | | 2006 | | N/A |
| 1000 Gills Drive | | Orlando, FL | | | — | | | | 333,873 | | | | — | | | | 269,171 | | | | — | | | | 603,044 | | | | 603,044 | | | | — | | | 2006 | | N/A |
| 17th & JFK Tower | | Philadelphia, PA | | | — | | | | 22,430,038 | | | | — | | | | 236,315,665 | | | | — | | | | 258,745,703 | | | | 258,745,703 | | | | — | | | 2005 | | N/A |
| 3900 Westerre Parkway | | Richmond, VA | | | — | | | | 392,184 | | | | — | | | | 10,177,825 | | | | — | | | | 10,570,009 | | | | 10,570,009 | | | | — | | | 2005 | | N/A |
| Renaissance Blvd & Hwy 20 | | Sturtevant, WI | | | — | | | | 2,484,450 | | | | — | | | | 8,512,026 | | | | — | | | | 10,996,476 | | | | 10,996,476 | | | | — | | | 2006 | | N/A |
| Bridgeway III Land | | Suffolk, VA | | | — | | | | 904,052 | | | | — | | | | 6,717,091 | | | | — | | | | 7,621,143 | | | | 7,621,143 | | | | — | | | 2006 | | N/A |
| 910-926 Chad Lane | | Tampa, FL | | | — | | | | 201,771 | | | | — | | | | 1,986,093 | | | | — | | | | 2,187,864 | | | | 2,187,864 | | | | — | | | 2006 | | N/A |
| 150-182 Kelsey Lane | | Tampa, FL | | | — | | | | 403,541 | | | | — | | | | 3,211,780 | | | | — | | | | 3,615,322 | | | | 3,615,322 | | | | — | | | 2006 | | N/A |
| 3701 Corporate Parkway | | Upper Saucon, PA | | | — | | | | 1,078,674 | | | | — | | | | 8,445,567 | | | | — | | | | 9,524,241 | | | | 9,524,241 | | | | — | | | 2005 | | N/A |
| 42 Kings Hill Avenue | | West Malling, UK | | | — | | | | — | | | | — | | | | 19,876,271 | | | | — | | | | 19,876,271 | | | | 19,876,271 | | | | — | | | 2005 | | N/A |
| 1 Kings Hill Aveune | | West Malling, UK | | | — | | | | — | | | | — | | | | 5,746,898 | | | | — | | | | 5,746,898 | | | | 5,746,898 | | | | — | | | 2006 | | N/A |
| 777 Township Line Road | | Yardley, PA | | | — | | | | 3,436,013 | | | | — | | | | 10,636,157 | | | | — | | | | 14,072,170 | | | | 14,072,170 | | | | — | | | 2005 | | N/A |
| | | | | | | | | |
| Subtotal Development in Progress | | | | $ | — | | | $ | 98,023,798 | | | $ | — | | | $ | 440,279,067 | | | $ | — | | | $ | 538,302,864 | | | $ | 538,302,864 | | | $ | — | | | | | |
| | | | | | | | | |
105
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2006
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Costs | | | | | | | | |
| | | | | | | | | | | | | | | | | Capitalized | | | | | | date of | | |
| | | | | | | | | | | | | | | | | Subsequent | | Gross Amount Carried at End of Period | | Accumulated | | Construction | | Depreciable |
| | | | | | | | | Initial Cost | | to | | Land and | | Building and | | Total | | Depreciation | | or | | life |
| Project | | Location | | Encumbrances | | Land | | Building | | Acquisition | | Improvements | | Improvements | | 12/31/2006 | | 12/31/06 | | Acquisition | | (years) |
| LAND HELD FOR DEVELOPMENT | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Perryman Road Land | | Aberdeen, MD | | $ | — | | | $ | 12,046,811 | | | $ | — | | | $ | 91,099 | | | $ | 12,137,910 | | | $ | — | | | $ | 12,137,910 | | | $ | — | | | 2005 | | N/A |
| LVCC Phase 2 Land | | Bethlehem, PA | | | — | | | | 3,148,780 | | | | — | | | | 1,117,583 | | | | 4,266,363 | | | | — | | | | 4,266,363 | | | | — | | | 1998 | | N/A |
| Lehigh Valley Corporate Center Land | | Bethlehem, PA | | | — | | | | 265,842 | | | | — | | | | — | | | | 265,842 | | | | — | | | | 265,842 | | | | — | | | 1987 | | N/A |
| Boca Colannade Yamato Road | | Boca Raton, FL | | | — | | | | 3,649,792 | | | | — | | | | 1,103,719 | | | | 4,753,511 | | | | — | | | | 4,753,511 | | | | — | | | 1998 | | N/A |
| 95 Kriner Road | | Chambersburg, PA | | | — | | | | 8,662,788 | | | | — | | | | 7,761,134 | | | | 16,423,922 | | | | — | | | | 16,423,922 | | | | — | | | 2006 | | N/A |
| Battlefield Corp Ctr, Parcel 14 | | Chesapeake, VA | | | — | | | | 1,532,779 | | | | — | | | | 6,634 | | | | 1,539,413 | | | | — | | | | 1,539,413 | | | | — | | | 2006 | | N/A |
| Rivers’ Bend Land | | Chesterfield, VA | | | — | | | | 1,695,415 | | | | — | | | | 3,060,359 | | | | 4,755,773 | | | | — | | | | 4,755,773 | | | | — | | | 1995 | | N/A |
| 501 Hewlett Packard Way | | Chesterfield, VA | | | — | | | | 165,042 | | | | — | | | | 484,965 | | | | 650,007 | | | | — | | | | 650,007 | | | | — | | | 1996 | | N/A |
| Pleasant Ridge Road Land | | Greensboro, NC | | | — | | | | 828,289 | | | | — | | | | — | | | | 828,289 | | | | — | | | | 828,289 | | | | — | | | 2006 | | N/A |
| Southchase Business Park Land | | Greenville, SC | | | — | | | | 1,369,712 | | | | — | | | | 688,157 | | | | 2,057,869 | | | | — | | | | 2,057,869 | | | | — | | | 1998 | | N/A |
| Hunters Green Land | | Hagerstown, MD | | | — | | | | 8,942,141 | | | | — | | | | 246,486 | | | | 9,188,627 | | | | — | | | | 9,188,627 | | | | — | | | 2006 | | N/A |
| Lakefront Plaza II Land | | Hampton, VA | | | 157,601 | | | | 132,785 | | | | — | | | | 92,936 | | | | 225,721 | | | | — | | | | 225,721 | | | | — | | | 2001 | | N/A |
| Patapsco Valley Business Center | | Hanover, MD | | | — | | | | 2,402,322 | | | | — | | | | 1,118,795 | | | | 3,521,117 | | | | — | | | | 3,521,117 | | | | — | | | 2004 | | N/A |
| Mendenhall Land | | High Point, NC | | | — | | | | 1,910,135 | | | | — | | | | 5,028,104 | | | | 6,938,239 | | | | — | | | | 6,938,239 | | | | — | | | 1995 | | N/A |
| Piedmond Centre Land | | High Point, NC | | | — | | | | 866,380 | | | | — | | | | 526,614 | | | | 1,392,994 | | | | — | | | | 1,392,994 | | | | — | | | 2006 | | N/A |
| Horsham Business Center Land | | Horsham, PA | | | — | | | | 80,800 | | | | — | | | | 455 | | | | 81,255 | | | | — | | | | 81,255 | | | | — | | | 2005 | | N/A |
| Commonwealth Corporate Center Land | | Horsham, PA | | | — | | | | 3,047,683 | | | | — | | | | 19,263 | | | | 3,066,946 | | | | — | | | | 3,066,946 | | | | — | | | 2005 | | N/A |
| Central Green Land | | Houston, TX | | | — | | | | 481,229 | | | | — | | | | 10,440 | | | | 491,669 | | | | — | | | | 491,669 | | | | — | | | 2001 | | N/A |
| Fallbrrok Drive Land | | Houston, TX | | | — | | | | 1,990,270 | | | | — | | | | 15,915 | | | | 2,006,186 | | | | — | | | | 2,006,186 | | | | — | | | 2006 | | N/A |
| Windfern Drive Land | | Houston, TX | | | — | | | | 1,222,065 | | | | — | | | | 4,317 | | | | 1,226,382 | | | | — | | | | 1,226,382 | | | | — | | | 2006 | | N/A |
| Noxell Land | | Hunt Valley, MD | | | — | | | | 2,166,068 | | | | — | | | | 830,242 | | | | 2,996,310 | | | | — | | | | 2,996,310 | | | | — | | | 2001 | | N/A |
| Liberty Business Park Land | | Jacksonville, FL | | | — | | | | 448,097 | | | | — | | | | 90,019 | | | | 538,116 | | | | — | | | | 538,116 | | | | — | | | 1995 | | N/A |
| 7024 AC Skinner Parkway | | Jacksonville, FL | | | — | | | | 468,643 | | | | — | | | | 356,309 | | | | 824,952 | | | | — | | | | 824,952 | | | | — | | | 1995 | | N/A |
| Belfort Road | | Jacksonville, FL | | | — | | | | 468,643 | | | | — | | | | 109,850 | | | | 578,493 | | | | — | | | | 578,493 | | | | — | | | 1998 | | N/A |
| Butler Plaza Land | | Jacksonville, FL | | | — | | | | 1,303,792 | | | | — | | | | 1,706,463 | | | | 3,010,255 | | | | — | | | | 3,010,255 | | | | — | | | 1998 | | N/A |
| Salisbury Road Land | | Jacksonville, FL | | | — | | | | 880,828 | | | | — | | | | 699,651 | | | | 1,580,479 | | | | — | | | | 1,580,479 | | | | — | | | 2000 | | N/A |
| Skinner Land Parcel B | | Jacksonville, FL | | | — | | | | 2,306,191 | | | | — | | | | 1,102,674 | | | | 3,408,865 | | | | — | | | | 3,408,865 | | | | — | | | 2005 | | N/A |
| Kent County, UK | | Kent County, UK | | | — | | | | — | | | | — | | | | 7,698,943 | | | | 7,698,943 | | | | — | | | | 7,698,943 | | | | — | | | 2006 | | N/A |
| Boulders Business Center Land | | Lehigh, PA | | | — | | | | 15,243,107 | | | | — | | | | 2,660,386 | | | | 17,903,493 | | | | — | | | | 17,903,493 | | | | — | | | 2004 | | N/A |
| Mill Run Land | | Lehigh, PA | | | — | | | | 2,882,221 | | | | — | | | | 49,691 | | | | 2,931,911 | | | | — | | | | 2,931,911 | | | | — | | | 2005 | | N/A |
| Commodore Business Park | | Logan, NJ | | | — | | | | 1,458,019 | | | | — | | | | — | | | | 1,458,019 | | | | — | | | | 1,458,019 | | | | — | | | 1995 | | N/A |
| Quarry Ridge Land | | Malvern, PA | | | — | | | | 8,398,708 | | | | — | | | | 1,894,356 | | | | 10,293,063 | | | | — | | | | 10,293,063 | | | | — | | | 2001 | | N/A |
| Park Place South Land | | Milwaukee, WI | | | — | | | | 2,362,904 | | | | — | | | | 1,384,531 | | | | 3,747,435 | | | | — | | | | 3,747,435 | | | | — | | | 1999 | | N/A |
| Monarch Towne Center Land | | Mirarar, FL | | | — | | | | 12,327,714 | | | | — | | | | — | | | | 12,327,714 | | | | — | | | | 12,327,714 | | | | — | | | 2006 | | N/A |
| South 27th Street Land | | Oak Creek, WI | | | — | | | | 1,594,760 | | | | — | | | | 97,911 | | | | 1,692,671 | | | | — | | | | 1,692,671 | | | | — | | | 2006 | | N/A |
| Maitland Summit Park Land | | Orlando, FL | | | — | | | | 4,388,905 | | | | — | | | | 33,427 | | | | 4,422,332 | | | | — | | | | 4,422,332 | | | | — | | | 2005 | | N/A |
| Beachline Industrial Park Land | | Orlando, FL | | | — | | | | 1,103,606 | | | | — | | | | 215,454 | | | | 1,319,061 | | | | — | | | | 1,319,061 | | | | — | | | 2006 | | N/A |
| JFK & Arch Parking Lots/Land (West) | | Philadelphia, PA | | | — | | | | 4,700,222 | | | | — | | | | 2,941,184 | | | | 7,641,406 | | | | — | | | | 7,641,406 | | | | — | | | 2000 | | N/A |
| 4775 League Island Boulevard | | Philadelphia, PA | | | — | | | | 396,833 | | | | — | | | | 900,027 | | | | 1,296,860 | | | | — | | | | 1,296,860 | | | | — | | | 2006 | | N/A |
| Eastport VII | | Richmond, VA | | | — | | | | 787,091 | | | | — | | | | 844,001 | | | | 1,631,092 | | | | — | | | | 1,631,092 | | | | — | | | 1997 | | N/A |
| Eastport VIII | | Richmond, VA | | | — | | | | 379,836 | | | | — | | | | 6,187 | | | | 386,023 | | | | — | | | | 386,023 | | | | — | | | 1997 | | N/A |
| Eastport IX | | Richmond, VA | | | — | | | | 209,856 | | | | — | | | | 5,096 | | | | 214,952 | | | | — | | | | 214,952 | | | | — | | | 1997 | | N/A |
| Westerre Land | | Richmond, VA | | | — | | | | 738,090 | | | | — | | | | 902,239 | | | | 1,640,329 | | | | — | | | | 1,640,329 | | | | — | | | 2003 | | N/A |
| Romulus Land | | Romulus, MI | | | — | | | | 788,338 | | | | — | | | | 733,216 | | | | 1,521,554 | | | | — | | | | 1,521,554 | | | | — | | | 1998 | | N/A |
| Woodlands Center Land | | Sandston, VA | | | — | | | | 928,555 | | | | — | | | | 290,438 | | | | 1,218,993 | | | | — | | | | 1,218,993 | | | | — | | | 1996 | | N/A |
| Northsight Land (LPLP) | | Scottsdale, AZ | | | — | | | | 7,247,107 | | | | — | | | | 1,130,879 | | | | 8,377,985 | | | | — | | | | 8,377,985 | | | | — | | | 2005 | | N/A |
| Bridgeway II Land | | Suffolk, VA | | | — | | | | 678,039 | | | | — | | | | 1,703,485 | | | | 2,381,525 | | | | — | | | | 2,381,525 | | | | — | | | 2005 | | N/A |
| Suffolk Land | | Suffolk, VA | | | — | | | | 2,713,494 | | | | — | | | | 79,375 | | | | 2,792,869 | | | | — | | | | 2,792,869 | | | | — | | | 2006 | | N/A |
| 6119 W. Linebaugh Avenue | | Tampa, FL | | | — | | | | 175,886 | | | | — | | | | 22,320 | | | | 198,205 | | | | — | | | | 198,205 | | | | — | | | 2000 | | N/A |
| Tampa Triangle Land | | Tampa, FL | | | — | | | | 10,448,263 | | | | — | | | | 28,881 | | | | 10,477,143 | | | | — | | | | 10,477,143 | | | | — | | | 2006 | | N/A |
| 4631 Woodland Corporate Blvd Land | | Tampa, FL | | | — | | | | 1,752,917 | | | | — | | | | 152,856 | | | | 1,905,773 | | | | — | | | | 1,905,773 | | | | — | | | 2006 | | N/A |
| Big Beaver Airport Land | | Troy, MI | | | — | | | | 3,176,411 | | | | — | | | | (2,079,253 | ) | | | 1,097,158 | | | | — | | | | 1,097,158 | | | | — | | | 1999 | | N/A |
| | | | | | | | | |
| Subtotal Land Held for Development | | | | $ | 157,601 | | | $ | 147,364,204 | | | $ | — | | | $ | 47,967,813 | | | $ | 195,332,017 | | | $ | — | | | $ | 195,332,017 | | | $ | — | | | | | |
| | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | |
| Total All Properties | | | | $ | 92,559,074 | | | $ | 864,019,318 | | | $ | 1,812,183,416 | | | $ | 2,549,944,384 | | | $ | 873,406,988 | | | $ | 4,352,740,132 | | | $ | 5,226,147,119 | | | $ | 806,308,940 | | | | | |
| | | | | | | | | |
| | |
| * | | Denotes property is collateralized under mortgages with American General, USG Annuity and Life, Metropolitan Life and LaSalle Bank totaling $93.4 million. This amount is not included in the total above. |
106
SCHEDULE III
LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
(In thousands)
A summary of activity for real estate and accumulated depreciation is as follows:
| | | | | | | | | | | | | |
| | | Year Ended December 31, | |
| | | 2006 | | | 2005 | | | 2004 | |
REAL ESTATE: | | | | | | | | | | | | |
| Balance at beginning of year | | $ | 4,767,968 | | | $ | 4,417,084 | | | $ | 4,055,515 | |
| Additions | | | 826,213 | | | | 656,317 | | | | 409,720 | |
| Disposition of property | | | (368,034 | ) | | | (305,433 | ) | | | (48,151 | ) |
| | | | | | | | | | |
| Balance at end of year | | $ | 5,226,147 | | | $ | 4,767,968 | | | $ | 4,417,084 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
ACCUMULATED DEPRECIATION: | | | | | | | | | | | | |
| Balance at beginning of year | | $ | 732,439 | | | $ | 678,326 | | | $ | 572,327 | |
| Depreciation expense | | | 124,853 | | | | 123,278 | | | | 114,199 | |
| Disposition of property | | | (50,983 | ) | | | (69,165 | ) | | | (8,200 | ) |
| | | | | | | | | | |
| Balance at end of year | | $ | 806,309 | | | $ | 732,439 | | | $ | 678,326 | |
| | | | | | | | | | |
107
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
The Company’s management, with the participation of its Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures, as of the end of the period covered by this report, were functioning effectively to provide reasonable assurance that information required to be disclosed by the Company in its reports filed or submitted under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC’s rules and forms and (ii) accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar function, as appropriate to allow timely decisions regarding required disclosure.
Management’s Annual Reports on Internal Control Over Financial Reporting
Management’s Annual Reports on Internal Control Over Financial Reporting, which appear on pages 33 and 72, are incorporated by reference herein.
Attestation Reports of the Registered Public Accounting Firm
The Attestation Reports of the Registered Public Accounting Firm, which appear on pages 34, 35, 73, and 74, are incorporated by reference herein.
Changes in Internal Controls
There were no changes in the Company’s internal control over financial reporting during the quarter ended December 31, 2006 that have materially affected or are reasonable likely to materially affect the Company’s internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
None.
108
PART III
ITEM 10. TRUSTEES, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information required by Item 10 shall be included in the Proxy Statement to be filed relating to the Company’s 2007 Annual Meeting of Shareholders and is incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
The information required by Item 11 shall be included in the Proxy Statement to be filed relating to the Company’s 2007 Annual Meeting of Shareholders and is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENTAND RELATED SHAREHOLDER MATTERS
The information required by Item 12 shall be included in the Proxy Statement to be filed relating to the Company’s 2007 Annual Meeting of Shareholders and is incorporated herein by reference.
Securities Authorized for Issuance Under Equity Compensation Plans
The information required by Item 12 shall be included in the Proxy Statement to be filed relating to the Company’s 2007 Annual Meeting of Shareholders and is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND TRUSTEE INDEPENDENCE
The information required by Item 13 shall be included in the Proxy Statement to be filed relating to the Company’s 2007 Annual Meeting of Shareholders and is incorporated herein by reference.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by Item 14 shall be included in the Proxy Statement to be filed relating to the Company’s 2007 Annual Meeting of Shareholders and is incorporated herein by reference.
109
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
The following consolidated financial statements of Liberty Property Trust and Liberty Property Limited Partnership are included in Item 8.
1. REPORTS OF ERNST & YOUNG LLP, INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND CONSOLIDATED FINANCIAL STATEMENTS
Management’s Annual Report on Internal Control Over Financial Reporting — Liberty Property Trust
Reports of Independent Registered Public Accounting Firm — Liberty Property Trust
Financial Statements — Liberty Property Trust
Balance Sheets:
Liberty Property Trust Consolidated as of December 31, 2006 and 2005
Statements of Operations:
Liberty Property Trust Consolidated for the years ended December 31, 2006, 2005, and 2004
Statements of Shareholders’ Equity:
Liberty Property Trust Consolidated for the years ended December 31, 2006, 2005, and 2004
Statements of Cash Flows:
Liberty Property Trust Consolidated for the years ended December 31, 2006, 2005, and 2004
Notes to Consolidated Financial Statements — Liberty Property Trust
Management’s Annual Report on Internal Control Over Financial Reporting — Liberty Property Limited Partnership
Reports of Independent Registered Public Accounting Firm — Liberty Property Limited Partnership
Financial Statements — Liberty Property Limited Partnership
Balance Sheets:
Liberty Property Limited Partnership Consolidated as of December 31, 2006 and 2005
Statements of Operations:
Liberty Property Limited Partnership Consolidated for the years ended December 31, 2006, 2005, and 2004
Statements of Owners’ Equity:
Liberty Property Limited Partnership Consolidated for the years ended December 31, 2006, 2005, and 2004
Statements of Cash Flows:
Liberty Property Limited Partnership Consolidated for the years ended December 31, 2006, 2005, and 2004
Notes to Consolidated Financial Statements — Liberty Property Limited Partnership
2. FINANCIAL STATEMENT SCHEDULES:
Schedule III — Real Estate and Accumulated Depreciation as of December 31, 2006 for Liberty Property Trust
All other schedules are omitted because they are either not required or the required information is shown in the financial statements or notes thereto.
Schedule III — Real Estate and Accumulated Depreciation as of December 31, 2006 for Liberty Property Limited Partnership
All other schedules are omitted because they are either not required or the required information is shown in the financial statements or notes thereto.
110
3. EXHIBITS
The following exhibits are filed herewith or are incorporated by reference to exhibits previously filed.
| | | |
| Exhibit No. | | Description |
| 3.1.1 | | Amended and Restated Declaration of Trust of the Trust (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants’ Current Report on Form 8-K filed with the Commission on June 25, 1997 (the “June 1997 Form 8-K”)). |
| | | |
| 3.1.2 | | Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust Establishing and Fixing the Rights and Preferences of a Series of Preferred Shares of Beneficial Interest (Incorporated by reference to Exhibit 1 filed with the Trust’s Registration Statement on Form 8-A filed with the Commission on August 8, 1997 (the “August 1997 Form 8-A”)). |
| | | |
| 3.1.3 | | Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust Relating to Designation, Preferences, and Rights of Series A Junior Participating Preferred Shares of the Trust. (Incorporated by reference to Exhibit 3.1.3 filed with the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 3l, 1997). |
| | | |
| 3.1.4 | | Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 9.25% Series B Cumulative Redeemable Preferred Shares of Beneficial Interest (Incorporated by reference to Exhibit 3.1.2 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 1999 (the “Second Quarter 1999 Form 10-Q”)). |
| | | |
| 3.1.5 | | Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 9.125% Series C Cumulative Redeemable Preferred Shares of Beneficial Interest. (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2000 (the “First Quarter 2000 Form 10-Q”)). |
| | | |
| 3.1.6 | | Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 7.625% Series D Cumulative Redeemable Preferred Shares of Beneficial Interest. (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2002 (the “Second Quarter 2002 Form 10-Q”)). |
| | | |
| 3.1.7 | | Articles of Amendment to Amended and Restated Declaration of Trust of the Trust, filed with the State Department of Assessments and Taxation of Maryland on June 21, 2004. (Incorporated by reference to Exhibit 3.1 with Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2004 (the “Second Quarter 2004 Form 10-Q”)). |
| | | |
| 3.1.8 | | Restatement of Amended Restated Declaration of Trust of the Trust, filed with the State Department of Assessments and Taxation of Maryland on June 21, 2004. (Incorporated by reference to Exhibit 3.2 to the Second Quarter 2004 Form 10-Q). |
| | | |
| 3.1.9 | | Articles Supplementary, as filed with the State Department of Assessments and Taxation of Maryland on September 1, 2004 (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Commission on September 2, 2004 (the “September 2, 2004 Form 8-K”)) |
| | | |
| 3.1.10 | | Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 7.00% Series E Cumulative Redeemable Preferred Shares of Beneficial Interest. (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Securities and Exchange Commission on June 17, 2005 (the “June 17, 2005 Form 8-K”)). |
| | | |
| 3.1.11 | | Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 6.65% Series F Cumulative Redeemable Preferred Shares of Beneficial Interest. (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Securities and Exchange Commission on June 30, 2005 (the “June 30, 2005 Form 8-K”)). |
111
| | | |
| Exhibit No. | | Description |
| 3.1.12 | | Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 6.65% Series F Cumulative Redeemable Preferred Shares of Beneficial Interest. (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Securities and Exchange Commission on August 24, 2005.) |
| | | |
| 3.1.13 | | Articles Supplementary to the amended and Restated Declaration of Trust of the Trust relating to the 6.70% Series G Cumulative Redeemable Preferred Shares of Beneficial Interest. (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Securities and Exchange Commission on December 18, 2006 (the “December 18, 2006 Form 8-K”)). |
| | | |
| 3.1.14 | | Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership, dated as of October 22, 1997 (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 1997 (the “Third Quarter 1997 Form 10-Q”)). |
| | | |
| 3.1.15 | | First Amendment to Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership. (Incorporated by reference to Exhibit 3.1.1 to the Second Quarter 1999 Form 10-Q). |
| | | |
| 3.1.16 | | Second Amendment to Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership. (Incorporated by reference to Exhibit 3.1.2 to the First Quarter 2000 Form 10-Q). |
| | | |
| 3.1.17 | | Third Amendment to Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership (Incorporated by reference to Exhibit 3.1.2 to the Second Quarter Form 2002 10-Q). |
| | | |
| 3.1.18 | | Fourth Amendment to the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership (Incorporated by reference to Exhibit 10 to the September 2, 2004 Form 8-K). |
| | | |
| 3.1.19 | | Fifth Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership. (Incorporated by reference to Exhibit 10 to the June 17, 2005 8-K). |
| | | |
| 3.1.20 | | Sixth Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership. (Incorporated by reference to Exhibit 10 to the June 30, 2005 8-K). |
| | | |
| 3.1.21 | | Amendment No. 1 to the Sixth Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership. (Incorporated by reference to Exhibit 10 to the Current Report on Form 8-K of the Registrants, filed with the Securities and Exchange Commission on August 24, 2005.) |
| | | |
| 3.1.22 | | Amendment No. 2 to the Sixth Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership. (Incorporated by reference to Exhibit 10 to the Current Report on Form 8-K of the Registrants, filed with the Securities and Exchange Commission on December 23, 2005.) |
| | | |
| 3.1.23 | | Seventh Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership. (Incorporated by reference to Exhibit 10 to the December 18, 2006 Form 8-K). |
| | | |
| 3.1.24* | | Amended and Restated Schedule A to the Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership. |
112
| | | |
| Exhibit No. | | Description |
| 3.1.25 | | Liberty Property Trust First Amended and Restated By-Laws of the Trust, as Amended on April 5, 2006 (Incorporated by reference to Exhibit 3.1 filed with the Commission on April 10, 2006) to the Registrants’ Current Report on Form 8-K. |
| | | |
| 4.1 | | Rights Agreement, dated as of December 17, 1997, by and between the Trust and the Rights Agent (Incorporated by reference to Exhibit 1 filed with the Trust’s Registration Statement on Form 8-A filed with the Commission on December 23, 1997). |
| | | |
| 4.1.1 | | Amendment, dated April 27, 2006, to the First Amended and Restated Rights Agreement, dated as of September 14, 2004 (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of the Registrant filed with the Commission on May 1, 2006). |
| | | |
| 4.2 | | Indenture (the “First Indenture”), dated as of August 14, 1997, between the Operating Partnership, as Obligor, and The First National Bank of Chicago (“First Chicago”), as Trustee (Incorporated by reference to Exhibit 10.1 filed with the Third Quarter 1997 Form 10-Q). |
| | | |
| 4.3 | | First Supplemental Indenture, dated as of August 14, 1997, between the Operating Partnership, as Issuer, and First Chicago, as Trustee, supplementing the First Indenture and relating to $100,000,000 principal amount of the 7.10% Senior Notes due 2004 and $100,000,000 principal amount of the 7.25% Senior Notes due 2007 of the Operating Partnership (Incorporated by reference to Exhibit 10.2 filed with the Third Quarter 1997 Form 10-Q). |
| | | |
| 4.4 | | Senior Indenture (the “Second Indenture”), dated as of October 24, 1997, between the Operating Partnership, as Obligor, and First Chicago, as Trustee (Incorporated by reference to Exhibit 10.3 filed with the Third Quarter 1997 Form 10-Q). |
| | | |
| 4.5 | | First Supplemental Indenture, dated as of October 24, 1997, between the Operating Partnership, as Issuer, and First Chicago, as Trustee, supplementing the Second Indenture and relating to the Fixed Rate and Floating Rate Medium-Term Notes due Nine Months or More from Date of Issue of the Operating Partnership (Incorporated by reference to Exhibit 10.4 filed with the Third Quarter 1997 Form 10-Q). |
| | | |
| 4.6 | | Second Supplemental Indenture, dated as of January 12, 1998, between the Operating Partnership, as Issuer, and First Chicago, as Trustee, supplementing the Second Indenture, and relating to the Fixed Rate and Floating Rate Medium-Term Notes due Nine Months or more from Date of Issue of the Operating Partnership (Incorporated by reference to Exhibit 4.1 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 1998 (the “First Quarter 1998 Form 10-Q”)). |
| | | |
| 4.7 | | Third Supplemental Indenture, dated as of April 20, 1999, between the Operating Partnership, as Issuer, and the First National Bank of Chicago, as Trustee, supplementing the Second Indenture and relating to the $250,000,000 principal amount of 7.75% Senior Notes, due 2009 of the Operating Partnership (Incorporated by reference to Exhibit 4 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 1999 (the “First Quarter 1999 Form 10-Q”)). |
| | | |
| 4.8 | | Fourth Supplemental Indenture, dated as of July 26, 2000, between the Operating Partnership, as Issuer, and Bank One Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between the Operating Partnership, as Obligor, and Bank One Trust Company, N.A. (as successor to the First National Bank of Chicago), as Trustee, and relating to $200,000,000 principal amount of 8.5% Senior Notes due 2010 of the Operating Partnership. (Incorporated by reference to Exhibit 4 to the Second Quarter 2000 Form 10-Q). |
| | | |
| 4.9 | | Fifth Supplemental Indenture, dated as of March 14, 2001, between the Operating Partnership, as Issuer, and Bank One Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between the Operating Partnership, as Obligor, and Bank One Trust Company, N.A. (as successor to the First National Bank of Chicago), as Trustee, and relating to $250,000,000 principal amount of 7.25% Senior Notes due 2011 of the Operating Partnership. (Incorporated by reference to Exhibit 4.10 filed with the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 31, 2000). |
113
| | | |
| Exhibit No. | | Description |
| 4.10 | | Sixth Supplemental Indenture, dated as of August 22, 2002, between Liberty Property Limited Partnership, as Issuer, and Bank One Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and Bank One Trust Company, N.A. (as successor to the First National Bank of Chicago), as Trustee, and relating to $150,000,000 principal amount of 6.375% Senior Notes due 2012 of Liberty Property Limited Partnership. (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2002 (the “Third Quarter 2002 Form 10-Q”)). |
| | | |
| 4.11 | | Seventh Supplemental Indenture, dated as of August 10, 2004, between Liberty Property Limited Partnership, as Issuer, and Bank One Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and Bank One Trust Company, National Association. (as successor to the First National Bank of Chicago), as Trustee, and relating to $200,000,000 principal amount of 5.65% Senior Notes due 2012 of Liberty Property Limited Partnership. (Incorporated by reference to Exhibit 4.1.2 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2004 (the “Third Quarter 2004 Form 10-Q”)). |
| | | |
| 4.12 | | Eighth Supplemental Indenture, dated as of March 1, 2005, between Liberty Property Limited Partnership, as Issuer, and Bank One Trust Company, as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and Bank One Trust Company, National Association (as successor to the First National Bank of Chicago), as Trustee, and relating to $300,000,000 principal amount of 5.125% Senior Notes due 2015 of Liberty Property Limited Partnership. (Incorporated by reference to Exhibit 4.2 filed with the Registrants’ Current Report on Form 8-K/A filed with the Commission on March 1, 2005 (the “March 2005 Form 8-K”)). |
| | | |
| 4.13* | | Ninth Supplemental Indenture, dated as of December 18, 2006, between Liberty Property Limited Partnership, as Issuer, and The Bank of New York Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and The Bank of New York Trust Company, N.A., (as successor to J.P. Morgan Trust Company, National Association and the First National Bank of Chicago), as Trustee, and relating to $300,000,000 principal amount of 5.50% Senior Notes due 2016 of Liberty Property Limited Partnership. |
| | | |
| 4.14 | | Note, Relating to the Issuance by the Operating Partnership, on January 22, 1998, of $75 Million Principal Amount of its 6.375% Medium-Term Notes due 2013, Putable/Callable 2003 (Incorporated by reference to Exhibit 4.2 filed with the First Quarter 1998 Form 10-Q). |
| | | |
| 4.15 | | Note, Relating to the Issuance by the Operating Partnership, on January 23, 1998, of $100 Million Principal Amount of its 7.50% Medium-Term Notes due 2018 (Incorporated by reference to Exhibit 4.3 filed with the First Quarter 1998 Form 10-Q). |
| | | |
| 4.16 | | Note, Relating to the Issuance by the Operating Partnership, on June 5, 1998, of $100 Million Principal Amount of its 6.60% Medium-Term Notes due 2002. (Incorporated by reference to Exhibit 4 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 1998 (the “Second Quarter 1998 Form 10-Q”)). |
| | | |
| 4.17 | | Note, Relating to the Issuance by the Operating Partnership on November 24, 1998, of $20 Million Principal Amount of its 8.125% Medium-Term Notes due January 15, 2009 (Incorporated by reference to Exhibit 4.11 filed with the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 31, 1998). |
| | | |
| 10.1 | | Liberty Property Trust Amended and Restated Share Incentive Plan as amended effective May 18, 2006 (Incorporated by reference to the Registrants Definitive Proxy Statement for the Annual Meeting of Shareholders held on May 18, 2006, filed with the Securities and Exchange Commission on April 18, 2006). |
| | | |
| 10.2 | | Contribution Agreement (Incorporated by reference to Exhibit 10.5 filed with the Form S-11). |
114
| | | |
| Exhibit No. | | Description |
| 10.3 | | Amended and Restated Limited Partnership Agreements of Pre-existing Pennsylvania Partnerships (Incorporated by reference to Exhibit 10.6 filed with the Form S-11). |
| | | |
| 10.4 | | Agreement of Sale for the Acquisition Properties (Incorporated by reference to Exhibit 10.7 filed with the Form S-11). |
| | | |
| 10.5 | | Option Agreement and Right of First Offer (Incorporated by reference to Exhibit 10.8 filed with the Form S-11). |
| | | |
| 10.6 | | Form of Indemnity Agreement (Incorporated by reference to Exhibit 10.9 filed with the Form S-11). |
| | | |
| 10.7 | | Contribution Agreement among the Trust, the Operating Partnership and the Contributing Owners described therein, related to the Lingerfelt Properties (Incorporated by reference to Exhibit 10.1 filed with the Registrants’ Current Report on Form 8-K filed with the Commission on March 3, 1995). |
| | | |
| 10.8 | | Amended and Restated Credit Agreement, dated as of December 22, 2005, by and among the Operating Partnership, the Trust, certain affiliated co-borrowers, with Bank of America, N.A. as Administrative Agent, JPMorgan Chase Bank, N.A., as Syndication Agent, Wachovia Bank, National Association, SunTrust Bank and Citizens Bank of Pennsylvania, as Documentation Agents, PNC Bank, National Association and Wells Fargo Bank, National Association, as Managing Agents, Banc of America Securities LLC and J.P. Morgan Securities Inc., as Joint Lead Arrangers and Joint Bookrunners, and the lenders a party thereto. (Incorporated by reference to Exhibit 10.8 filed with Registrants’ Annual Report on Form 10-K for the year ended December 31, 2006. |
| | | |
| 10.9 | | Liberty Property Trust — Amended Management Severance Plan. (Incorporated by reference to Exhibit 10.9 filed with Registrants’ Annual Report on Form 10-K for the year ended December 31, 2001). |
| | | |
| 10.10 | | Liberty Property Trust — Employee Stock Purchase Plan. (Incorporated by reference to Exhibit 10.14 filed with the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2000). |
| | | |
| 10.11 | | Description of Compensation of Non-Employee Trustees. (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of the Registrants filed with the Commission on February 23, 2005.) |
| | | |
| 10.12 | | Form of Restricted Share Grant under the Liberty Property Trust Amended and Restated Share Incentive Plan. (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of the Registrants filed with the Commission on February 24, 2005 (the “February 24, 2005 8-K”)). |
| | | |
| 10.13 | | Form of Option Grant under the Liberty Property Trust Amended and Restated Share Incentive Plan. (Incorporated by reference to Exhibit 10.2 to the February 24, 2005 8-K). |
| | | |
| 10.14 | | Certain Elements of the Liberty Property Trust Executive Compensation Program. (Incorporated by reference to Exhibit 10.1 to the filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2006). |
| | | |
| 10.15 | | Amended and Restated Limited Partnership of Liberty/Commerz 1701 JFK Boulevard Limited Partnership, dated as of April 11, 2006, by and among Liberty Property Philadelphia Corporation IV East, as general partner, and the Operating Partnership and 1701 JFK Boulevard Philadelphia, L.P. as limited partners. (Incorporated by reference to Exhibit 10.3 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2006 (the “Second Quarter 2006 Form 10-Q)). |
115
| | | |
| Exhibit No. | | Description |
| 10.16 | | NOI Support Agreement, dated as of April 11, 2006, by Liberty Property Limited Partnership in favor of Liberty/Commerz 1701 JFK Boulevard, L.P. and 1701 JFK Boulevard Philadelphia, L.P. (Incorporated by reference to Exhibit 10.4 filed with the Registrants’ Second Quarter 2006 Form 10-Q). |
| | | |
| 10.17 | | Completion and Payment Agreement and Guaranty, dated as of April 11, 2006, by the Operating Partnership for the benefit of 1701 JFK Boulevard Philadelphia, L.P. and Liberty/Commerz 1701 JFK Boulevard L.P. (Incorporated by reference to Exhibit 10.5 filed with the Registrants’ Second Quarter 2006 Form 10-Q). |
| | | |
| 12* | | Statement re: Computation of Ratios. |
| | | |
| 21* | | Subsidiaries. |
| | | |
| 23.1* | | Consent of Ernst & Young LLP relating to the Trust. |
| | | |
| 23.2* | | Consent of Ernst & Young LLP relating to the Operating Partnership. |
| | | |
| 31.1* | | Certifications of the Chief Executive Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934. |
| | | |
| 31.2* | | Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934. |
| | | |
| 31.3* | | Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934. |
| | | |
| 31.4* | | Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934. |
| | | |
| 32.1* | | Certifications of the Chief Executive Officer of Liberty Property Trust required under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) |
| | | |
| 32.2* | | Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) |
| | | |
| 32.3* | | Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) |
116
| | | |
| Exhibit No. | | Description |
| 32.4* | | Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) |
117
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
| | | | | | | |
| | | LIBERTY PROPERTY TRUST | | |
| | | | | | | |
| Date: February 28, 2007 | | By: | | /s/ WILLIAM P. HANKOWSKY | | |
| | | | | | | |
| | | WILLIAM P. HANKOWSKY | | |
| | | CHAIRMAN, PRESIDENT AND | | |
| | | CHIEF EXECUTIVE OFFICER | | |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
| | | | | |
| /s/ WILLIAM P. HANKOWSKY | | Chairman of the Board of Trustees, President and Chief Executive Officer (Principal Executive Officer | | February 28, 2007 |
| | | | |
| William P. Hankowsky | | | |
| | | | | |
| /s/ GEORGE J. ALBURGER, JR. | | Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) | | February 28, 2007 |
| | | | |
| George J. Alburger, Jr. | | | |
| | | | | |
| /s/ M. LEANNE LACHMAN | | Trustee | | February 28, 2007 |
| | | | | |
| M. Leanne Lachman | | | | |
| | | | | |
| /s/ FREDERICK F. BUCHHOLZ | | Trustee | | February 28, 2007 |
| | | | | |
| Frederick F. Buchholz | | | | |
| | | | | |
| /s/ J. ANTHONY HAYDEN | | Trustee | | February 28, 2007 |
| | | | | |
| J. Anthony Hayden | | | | |
| | | | | |
| /s/ DAVID L. LINGERFELT | | Trustee | | February 28, 2007 |
| | | | | |
| David L. Lingerfelt | | | | |
| | | | | |
| /s/ JOHN A. MILLER, CLU | | Trustee | | February 28, 2007 |
| | | | | |
| John A. Miller, CLU | | | | |
| | | | | |
| /s/ STEPHEN B. SIEGEL | | Trustee | | February 28, 2007 |
| | | | | |
| Stephen B. Siegel | | | | |
| | | | | |
| /s/ THOMAS C. DELOACH, JR. | | Trustee | | February 28, 2007 |
| | | | | |
| Thomas C. DeLoach, Jr. | | | | |
| | | | | |
| /s/ DANIEL P. GARTON | | Trustee | | February 28, 2007 |
| | | | | |
| Daniel P. Garton | | | | |
| | | | | |
| /s/ JOSE A. MEJIA | | Trustee | | February 28, 2007 |
| | | | | |
| Jose A. Mejia | | | | |
118
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
| | | | | | | |
| | | LIBERTY PROPERTY LIMITED PARTNERSHIP | | |
| | | | | | | |
| | | BY: Liberty Property Trust
General Partner | | |
| | | | | | | |
| Date: February 28, 2007 | | By: | | /s/ WILLIAM P. HANKOWSKY | | |
| | | | | | | |
| | | WILLIAM P. HANKOWSKY | | |
| | | CHAIRMAN, PRESIDENT AND | | |
| | | CHIEF EXECUTIVE OFFICER | | |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
| | | | | |
| /s/ WILLIAM P. HANKOWSKY | | Chairman of the Board of Trustees, President and Chief Executive Officer (Trustee of the General Partner) | | February 28, 2007 |
| | | | |
| William P. Hankowsky | | | |
| | | | | |
| /s/ GEORGE J. ALBURGER, JR. | | Executive Vice President and Chief Financial Officer (Trustee of the General Partner) | | February 28, 2007 |
| | | | |
| George J. Alburger, Jr. | | | |
| | | | | |
| /s/ M. LEANNE LACHMAN | | Trustee of the General Partner | | February 28, 2007 |
| | | | | |
| M. Leanne Lachman | | | | |
| | | | | |
| /s/ FREDERICK F. BUCHHOLZ | | Trustee of the General Partner | | February 28, 2007 |
| | | | | |
| Frederick F. Buchholz | | | | |
| | | | | |
| /s/ J. ANTHONY HAYDEN | | Trustee of the General Partner | | February 28, 2007 |
| | | | | |
| J. Anthony Hayden | | | | |
| | | | | |
| /s/ DAVID L. LINGERFELT | | Trustee of the General Partner | | February 28, 2007 |
| | | | | |
| David L. Lingerfelt | | | | |
| | | | | |
| /s/ JOHN A. MILLER, CLU | | Trustee of the General Partner | | February 28, 2007 |
| | | | | |
| John A. Miller, CLU | | | | |
| | | | | |
| /s/ STEPHEN B. SIEGEL | | Trustee of the General Partner | | February 28, 2007 |
| | | | | |
| Stephen B. Siegel | | | | |
| | | | | |
| /s/ THOMAS C. DELOACH, JR. | | Trustee of the General Partner | | February 28, 2007 |
| | | | | |
| Thomas C. DeLoach, Jr. | | | | |
| | | | | |
| /s/ DANIEL P. GARTON | | Trustee of the General Partner | | February 28, 2007 |
| | | | | |
| Daniel P. Garton | | | | |
| | | | | |
| /s/ JOSE A. MEJIA | | Trustee of the General Partner | | February 28, 2007 |
| | | | | |
| Jose A. Mejia | | | | |
119
EXHIBIT INDEX
| | | |
| Exhibit No. | | Description |
| 3.1.24 | | Amended and Restated Schedule A to the Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership. |
| | | |
| 4.13 | | Ninth Supplemental Indenture, dated as of December 18, 2006 between Liberty Property Limited Partnership, as Issuer, and The Bank of New York Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and The Bank of New York Trust Company, N.A., (as successor to J.P. Morgan Trust Company, National Association and the First National Bank of Chicago), as Trustee, and relating to $300,000,000 principal amount of 5.50% Senior Notes due 2016 of Liberty Property Limited Partnership. |
| | | |
| 12 | | Statement re: Computation of Ratios. |
| | | |
| 21 | | Subsidiaries. |
| | | |
| 23.1 | | Consent of Ernst & Young LLP relating to the Trust. |
| | | |
| 23.2 | | Consent of Ernst & Young LLP relating to the Operating Partnership. |
| | | |
| 31.1 | | Certifications of the Chief Executive Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934. |
| | | |
| 31.2 | | Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934. |
| | | |
| 31.3 | | Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934. |
| | | |
| 31.4 | | Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934. |
| | | |
| 32.1 | | Certifications of the Chief Executive Officer of Liberty Property Trust required under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) |
| | | |
| 32.2 | | Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) |
| | | |
| 32.3 | | Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) |
120
| | | |
| Exhibit No. | | Description |
| 32.4 | | Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended. |
121
