Liberty Property Limited Partnership 10-K/A 2008 FY Annual report (amended)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

(Amendment No. 1)

(Mark One)

þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2008

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                    to                    

Commission file numbers:	1-13130 (Liberty Property Trust)
	1-13132 (Liberty Property Limited Partnership)

LIBERTY PROPERTY TRUST
LIBERTY PROPERTY LIMITED PARTNERSHIP

(Exact Names of Registrants as Specified in Their Governing Documents)

MARYLAND(Liberty Property Trust)	23-7768996
PENNSYLVANIA(Liberty Property Limited Partnership)	23-2766549
(State or Other Jurisdiction	(I.R.S. Employer
of Incorporation or Organization)	Identification Number)
500 Chesterfield Parkway
Malvern, Pennsylvania	19355
(Address of Principal Executive Offices)	(Zip Code)
Registrants’ Telephone Number, including Area Code	(610) 648-1700

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

	NAME OF EACH EXCHANGE
TITLE OF EACH CLASS	ON WHICH REGISTERED
Common Shares of Beneficial Interest,
$0.001 par value
(Liberty Property Trust)	New York Stock Exchange

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.þ

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

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

Large Accelerated Filerþ	Accelerated Filero	Non-Accelerated Filero	Smaller Reporting Companyo
	(Do not check if a smaller reporting company)

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 $3.1 billion, based upon the closing price of $33.15 on the New York Stock Exchange composite tape on June 30, 2008. 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, 2009: 101,348,063

Documents Incorporated by Reference

Portions of the proxy statement for the annual meeting of shareholders of Liberty Property Trust to be held in 2009 are incorporated by reference into Part III of this Form 10-K.

EXPLANATORY NOTE

Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust. 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 is filing this 10-K/A to revise certain items included in its Annual Report on Form 10-K for the year ended December 31, 2008.

This Form 10-K/A updates Items 6, 7, 8 and 15 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (the “Form 10-K”), to (i) reflect the adoption of SFAS No. 160; (ii) to correct the Company’s accounting under EITF Topic D-98; and (iii) to reflect the results of operations of the Company’s real properties which have been sold prior to March 31, 2009 or were held for sale at March 31, 2009, as discontinued operations. All other items of the Company’s Form 10-K remain unchanged. No attempt has been made to update matters in the Form 10-K except to the extent expressly provided above.

The Company’s management has considered whether the adjustments to the Company’s financial statements reflected herein, and in particular the proper application of EITF D-98, affect management’s conclusion, set forth in the Form 10-K, regarding the effectiveness, as of December 31, 2008, of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) and the Company’s internal control over financial reporting, (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended). Management continues to believe that, as of December 31, 2008:

• The Company’s disclosure controls and procedures 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 functions, as appropriate to allow timely decisions regarding required disclosure; and

• The Company’s internal control over financial reporting was effective based on the criteria on which it was evaluated, as described in the Form 10-K. Management’s Annual Reports on Internal Control over Financial Reporting are included in the Form 10-K.

2

INDEX

	Page
Item 6. Selected Financial Data		4
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations		6
Item 8. Financial Statements and Supplementary Data		20
Item 15. Exhibits and Financial Statement Schedules		103
Signatures for Liberty Property Trust		105
Signatures for Liberty Property Limited Partnership		105
Exhibit Index
Statement re: Computation of Ratios
Consent of Ernst & Young LLP relating to the Trust
Consent of Ernst &Young LLP relating to the Operating Partnership
Exhibit 12
Exhibit 23.1
Exhibit 23.2

3

ITEM 6. SELECTED FINANCIAL DATA

The following tables set forth Selected Financial Data for Liberty Property Trust and Liberty Property Limited Partnership as of and for the years ended December 31, 2008, 2007, 2006, 2005 and 2004. 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.

Liberty Property Trust

Operating Data	Year Ended December 31,
(In thousands, except per share data)	2008		2007		2006		2005		2004
Total operating revenue	$	746,008	$	684,885	$	605,820	$	576,051	$	528,331
Income from continuing operations	$	153,341	$	146,783	$	158,970		214,281		139,729
Net income	$	180,106	$	190,310	$	292,043		272,785		179,610
Basic:
Income from continuing operations	$	1.35	$	1.35	$	1.55	$	2.23	$	1.46
Income from discontinued operations	$	0.27	$	0.46	$	1.43	$	0.64	$	0.45
Income per common share	$	1.62	$	1.81	$	2.98	$	2.87	$	1.91
Diluted:
Income from continuing operations	$	1.35	$	1.35	$	1.54	$	2.19	$	1.44
Income from discontinued operations	$	0.27	$	0.45	$	1.41	$	0.63	$	0.44
Income per common share	$	1.62	$	1.80	$	2.95	$	2.82	$	1.88
Distributions paid per common share	$	2.500	$	2.485	$	2.465	$	2.445	$	2.425
Weighted average number of shares outstanding – basic (1)		93,624		91,185		89,313		86,986		84,534
Weighted average number of shares outstanding – diluted (2)		93,804		91,803		90,492		88,376		86,024

4

Balance Sheet Data	December 31,
(In thousands)	2008		2007		2006		2005		2004
Net real estate	$	4,546,418	$	4,906,738	$	4,318,530	$	3,936,516	$	3,641,569
Total assets		5,217,035		5,643,937		4,910,911		4,500,322		4,163,997
Total indebtedness		2,590,167		3,021,129		2,387,938		2,249,178		2,133,171
Shareholders’ equity		1,919,871		1,800,333		1,752,059		1,626,531		1,506,227

Other Data	Year Ended December 31,
(Dollars in thousands)	2008			2007			2006			2005			2004
Cash provided by operating activities	$	268,470		$	346,752		$	324,573		$	360,749		$	293,336
Cash provided by (used in) investing activities		52,553			(758,924	)		(334,942	)		(286,633	)		(373,975	)
Cash (used in) provided by financing activities		(333,835	)		396,322			(327	)		(39,470	)		89,618
Funds from operations available to common shareholders (3)		313,910			305,216			294,801			293,973			291,144
Total leaseable square footage of Wholly Owned Properties in Operation at end of period (in thousands)		63,799			62,079			59,160			60,613			58,052
Total leasable square footage of JV Properties in Operation at end of period (in thousands)		13,069			11,462			6,172			3,758			3,603
Wholly Owned Properties in Operation at end of period		654			649			672			675			693
JV Properties in Operation at end of period		95			91			48			43			30
Wholly Owned Properties in Operation percentage leased at end of period		91	%		93	%		94	%		92	%		92	%
JV properties in operation percentage leased at end of period		92	%		94	%		95	%		99	%		96	%

Liberty Property Limited Partnership

Operating Data	Year Ended December 31,
(In thousands, except per share data)	2008		2007		2006		2005		2004
Total operating revenue	$	746,008	$	684,885	$	605,820	$	576,051	$	528,331
Income from continuing operations	$	153,341	$	146,783	$	158,970	$	214,281	$	139,729
Income available to common unitholders	$	180,106	$	190,310	$	292,043	$	272,785	$	179,610
Basic:
Income from continuing operations	$	1.35	$	1.35	$	1.55	$	2.23	$	1.46
Income from discontinued operations	$	0.27	$	0.46	$	1.43	$	0.64	$	0.45
Income per common unit	$	1.62	$	1.81	$	2.98	$	2.87	$	1.91
Diluted:
Income from continuing operations	$	1.35	$	1.35	$	1.54	$	2.19	$	1.44
Income from discontinued operations	$	0.27	$	0.45	$	1.41	$	0.63	$	0.44
Income per common unit	$	1.62	$	1.80	$	2.95	$	2.82	$	1.88
Distributions paid per common unit	$	2.500	$	2.485	$	2.465	$	2.445	$	2.425
Weighted average number of units outstanding – basic (1)		97,814		95,375		93,208		90,540		88,210
Weighted average number of units outstanding – diluted (2)		97,994		95,993		94,387		91,931		89,700

5

Balance Sheet Data	December 31,
(In thousands)	2008		2007		2006		2005		2004
Net real estate	$	4,546,418	$	4,906,738	$	4,318,530	$	3,936,516	$	3,641,569
Total assets		5,217,035		5,643,937		4,910,911		4,500,322		4,163,997
Total indebtedness		2,590,167		3,021,129		2,387,938		2,249,178		2,133,171
Owners’ equity		1,919,871		1,800,333		1,752,059		1,626,531		1,506,227

Other Data	Year Ended December 31,
(Dollars in thousands)	2008			2007			2006			2005			2004
Cash provided by operating activities	$	268,470		$	346,752		$	324,573		$	360,749		$	293,336
Cash provided by (used in) investing activities		52,553			(758,924	)		(334,942	)		(286,633	)		(373,975	)
Cash (used in) provided by financing activities		(333,835	)		396,322			(327	)		(39,470	)		89,618
Funds from operations available to common shareholders (3)		313,910			305,216			294,801			293,973			291,144
Total leaseable square footage of Wholly Owned Properties in Operation at end of period (in thousands)		63,799			62,079			59,160			60,613			58,052
Total leasable square footage of JV Properties in Operation at end of period (in thousands)		13,069			11,462			6,172			3,758			3,603
Wholly Owned Properties in Operation at end of period		654			649			672			675			693
JV Properties in Operation at end of period		95			91			48			43			30
Wholly Owned Properties in Operation percentage leased at end of period		91	%		93	%		94	%		92	%		92	%
JV properties in operation percentage leased at end of period		92	%		94	%		95	%		99	%		96	%

(1)	Basic weighted average number of shares includes vested Common Shares (Liberty Property Trust)/Common Units (Liberty Property Limited Partnership) outstanding during the year.
(2)	Diluted weighted average number of shares outstanding includes the vested and unvested Common Shares (Liberty Property Trust)/Common Units (Liberty Property Limited Partnership) 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 19.

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 (“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”).

The Company operates primarily in the Mid-Atlantic, Southeastern, Midwestern and Southwestern United States. Additionally, the Company owns certain assets in the United Kingdom.

As of December 31, 2008, the Company owned and operated 357 industrial and 297 office properties (the “Wholly Owned Properties in Operation”) totaling 63.8 million square feet. In addition, as of December 31, 2008, the Company owned 17 properties under development, which when completed are expected to comprise 3.2 million square feet (the “Wholly Owned Properties under Development”) and 1,336 acres of developable land, substantially

6

all of which is zoned for commercial use. Additionally, as of December 31, 2008, the Company had an ownership interest, through unconsolidated joint ventures, in 46 industrial and 49 office properties totaling 13.1 million square feet (the “JV Properties in Operation” and, together with the Wholly Owned Properties in Operation, the “Properties in Operation”), four properties under development, which when completed are expected to comprise 1.4 million square feet (the “JV Properties under Development” and, together with the Wholly Owned Properties under Development, the “Properties under Development”). The Company also has an ownership interest through unconsolidated joint ventures in 648 acres of developable land, substantially all of which is zoned for commercial use.

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 and controlling costs. 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.

Recent uncertainty in the global credit markets and declines and weakness in the general economy have negatively impacted the Company’s business practices. The credit markets have become considerably less favorable than in the recent past and the Company has shifted its financing strategy to include more secured debt and equity sales in order to address its financing needs. Additionally, uncertainty about the pricing of commercial real estate and the absence of available financing to facilitate transactions has dramatically reduced the Company’s ability to rely on the proceeds from the sale of real estate to provide proceeds to fund investment opportunities. Similarly, current market conditions are not favorable for acquisitions and development and consequently the potential for growth in operating income from acquisitions and development is anticipated to be limited in 2009.

Consistent with the dramatic slow down in the United States and world economy, rental demand for the Properties in Operation declined for the year ended December 31, 2008 as compared to the year ended December 31, 2007. Despite this trend, the Company successfully leased 20.4 million square feet during the year ended December 31, 2008 and attained occupancy of 91.1% for the Wholly Owned Properties in Operation and 92.2% for the JV Properties in Operation for a combined occupancy of 91.3% for the Properties in Operation as of that date. At December 31, 2007, occupancy for the Wholly Owned Properties in Operation was 92.7% and for the JV Properties in Operation was 94.0% for a combined occupancy for the Properties in Operation of 92.9%. The Company believes that straight line rents on renewal and replacement leases for 2009 will on average be equal to or 5% less than rents on expiring leases. Furthermore, the Company believes that average occupancy for its Properties in Operation will remain the same or decrease by 2% for 2009 compared to 2008.

WHOLLY OWNED CAPITAL ACTIVITY

Acquisitions

During the year ended December 31, 2008, conditions for the acquisition of properties were unsettled because of adverse events in the credit markets. During the year ended December 31, 2008, the Company acquired one property representing 107,000 square feet for a Total Investment, as defined below, of $17.0 million. “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. For 2009, the Company does not anticipate any wholly owned property acquisitions and pursuant to an existing commitment expects to purchase $17.6 million in land.

Dispositions

During the year ended December 31, 2008, market conditions for dispositions were unsettled, which the Company again attributes to adverse events in the credit markets. Disposition activity allows the Company to, among other things, (1) reduce its holdings in certain markets and product types within a market; (2) lower the average age of the portfolio; (3) optimize the cash proceeds from the sale of certain assets; and (4) obtain funds for investment activities. During the year ended December 31, 2008, the Company realized proceeds of $83.0 million from the sale of 13 operating properties representing 665,000 square feet and 24 acres of land. For 2009, the Company believes it will realize proceeds of approximately $125 million to $200 million from the sale of operating properties.

7

Development

During the year ended December 31, 2008, the Company brought into service 17 Wholly Owned Properties under Development representing 3.2 million square feet and a Total Investment of $217.0 million, and initiated $207.6 million in real estate development. As of December 31, 2008, the projected Total Investment of the Wholly Owned Properties under Development was $373.6 million. For 2009, the Company believes that it will bring into service from its development pipeline approximately $250 million to $350 million of Total Investment in operating real estate. Although the Company continues to pursue development opportunities, current market conditions are not favorable for development, and the Company currently anticipates only a modest amount of development starts in 2009. Furthermore, any 2009 development starts will be substantially pre-leased.

JOINT VENTURE CAPITAL ACTIVITY

The Company periodically enters into joint venture relationships in connection with the execution of its real estate operating strategy.

Acquisitions

During the year ended December 31, 2008, none of the unconsolidated joint ventures in which the Company held an interest acquired any properties. For 2009, the Company believes that property acquisitions by existing joint ventures will be in the $50 million to $100 million range.

Dispositions

During the year ended December 31, 2008, a joint venture in which the Company held a 50% interest realized proceeds of $1.4 million from the sale of one acre of land. For 2009, the Company does not anticipate that any unconsolidated joint ventures in which it holds an interest will dispose of any operating properties.

Development

During the year ended December 31, 2008, joint ventures in which the Company held a 50% interest brought into service three Properties under Development representing 351,000 square feet and a Total Investment of $42.5 million. As of December 31, 2008, the projected Total Investment of JV Properties under Development was $186.4 million. For 2009, the Company expects unconsolidated joint ventures in which it holds an interest to bring into service $50 million or less of Total Investment in operating properties.

Liberty/Commerz 1701 JFK Boulevard, LP

On April 13, 2006, the Company entered into a joint venture pursuant to which it sold an 80% interest in the equity of Comcast Center, a 1.25 million square foot office tower the Company was then developing in Philadelphia, Pennsylvania. The transaction valued the property at $512 million. Upon signing the joint venture agreement and through March 30, 2008, the criteria for sale recognition in accordance with SFAS No. 66,“Accounting for the Sale of Real Estate”(“SFAS 66”) had not been met and the transaction was accounted for as a financing arrangement.

On March 31, 2008, a $324 million, ten-year secured financing at a 6.15% interest rate for Comcast Center was funded. The proceeds from this financing were used to pay down outstanding borrowings on the Company’s Credit Facility.

On March 31, 2008, all conditions for sale treatment as outlined in SFAS No. 66 were satisfied and the Company recognized the sale of Comcast Center to an unconsolidated joint venture. Profit on the transaction was deferred until the costs of the project could be reasonably estimated. Profit on the sale was recognized in the fourth quarter of 2008. See Note 4 to the Company’s Consolidated Financial Statements.

During the year ended December 31, 2008, the Company brought into service the final 306,000 square feet of Comcast Center equaling $124.1 million of Total Investment.

Forward-Looking Statements

When used throughout this report, the words “believes,” “anticipates” and “expects” and similar expressions are intended to identify forward-looking statements. Such statements indicate that assumptions have been used that are subject to a number of risks and uncertainties that 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 enter into agreements with suitable joint venture partners in situations where it believes such arrangements are advantageous; the Company’s ability to identify and secure additional properties and sites, both for itself and the joint ventures to which it is a party, that

8

meet its criteria for acquisition or development; the current credit crisis and its impact on the availability and cost of capital; the effect of prevailing market interest rates; risks related to the integration of the operations of entities that we have acquired or may acquire; risks related to litigation; 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 following critical accounting policies discussion reflects what the Company believes are the more significant estimates, assumptions and judgments used in the preparation of its Consolidated Financial Statements. This discussion of critical accounting policies is intended to supplement the description of the accounting policies in the footnotes to the Company’s Consolidated Financial Statements and to provide additional insight into the information used by management when evaluating significant estimates, assumptions and judgments. For further discussion of our significant accounting policies, see Note 2 to the Consolidated Financial Statements included in this report.

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. 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, 2008, 2007 and 2006 was $20.0 million, $45.7 million and $30.8 million, respectively.

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, 2008 and 2007, the Company’s allowance for doubtful accounts totaled $8.5 million and $6.0 million, respectively. The Company’s bad debt expense for the years ended December 31, 2008, 2007 and 2006 was $4.8 million, $3.4 million and $1.0 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 upon occurrence of significant adverse changes in operations to assess whether any impairment indicators are present that could affect the recovery of the recorded value. Indicators the Company uses to determine whether an impairment evaluation is necessary includes the low occupancy level of the property, holding period for the property, strategic decisions regarding future development plans for a property under development and land held for development and other market factors. If impairment indicators are present the Company performs an undiscounted cash flow analysis and compares the net carrying amount of the property to the property’s estimated undiscounted future cash flow over the anticipated holding period. The Company assesses the

9

expected undiscounted cash flows based upon estimated capitalization rates, historic operating results and market conditions that may affect the property. If any real estate investment is considered impaired, the carrying value of the property is written down to its estimated fair value. Fair value is estimated based on the discounting of future expected cash flows at a risk adjusted interest rate. During the years ended December 31, 2008, 2007 and 2006 the Company recognized impairment losses of $3.1 million, $0.2 million and $4.2 million, respectively. The determination of whether an impairment exists requires the Company to make estimates, judgments and assumptions about the future cash flows. The Company has evaluated each of its Properties and land held for development and has determined that there are no additional impairment charges that need to be recorded at December 31, 2008.

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.

The Company assesses goodwill for impairment annually in November and in interim periods if certain events occur indicating the carrying value is impaired. The Company performs its analysis for potential impairment of goodwill in accordance with SFAS 142, which requires that a two-step impairment test be performed on goodwill. In the first step, the fair value of the reporting unit is compared to its carrying value. If the fair value exceeds its carrying value, goodwill is not impaired, and no further testing is required. If the carrying value of the reporting unit exceeds its fair value, then a second step must be performed in order to determine the implied fair value of the goodwill and compare it to the carrying value of the goodwill. If the carrying value of goodwill exceeds its implied fair value then an impairment loss is recorded equal to the difference. No impairment losses were recognized during the years ended December 31, 2008 or 2007.

Investments in Unconsolidated Joint Ventures

The Company analyzes its investments in joint ventures under FASB Interpretation No. 46(R), “Consolidation of Variable Interest Entities,”to determine if the joint venture is considered a variable interest entity and would require consolidation. To the extent that the Company’s joint ventures do not qualify as variable interest entities, it completes a further assessment under the guidelines of Emerging Issues Task Force (“EITF”) Issue No. 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”(“EITF 04-5”) to determine if the venture should be consolidated. The Company does not have any interests in variable interest entities. 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. These investments are recorded initially at cost, as Investments in Unconsolidated Joint Ventures, and subsequently adjusted for equity in earnings and cash contributions and distributions.

On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated joint ventures may be impaired. An investment is impaired only if management’s estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss is measured as the excess of the carrying amount of the investment over the estimated fair value of the investment. The Company’s estimates of fair value for each investment are based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and operating costs. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the values estimated by management in its impairment analyses may not be realized.

10

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, 2008 with the results of operations of the Company for the year ended December 31, 2007, and the results of operations of the Company for the year ended December 31, 2007 with the results of operations of the Company for the year ended December 31, 2006. As a result of the varying level of development, acquisition and disposition activities by the Company in 2008, 2007 and 2006, the overall operating results of the Company during such periods are not directly comparable. However, certain data, including the Same Store (as defined below) 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.

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

Overview

The Company’s average gross investment in operating real estate owned for the year ended December 31, 2008 increased to $5,031.2 million from $4,514.9 million for the year ended December 31, 2007. This increase in operating real estate owned resulted in increases in rental revenue, operating expense reimbursement, rental property operating expenses, real estate taxes and depreciation and amortization expense.

Total operating revenue increased to $746.0 million for the year ended December 31, 2008 from $684.9 million for the year ended December 31, 2007. This $61.1 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, discussed below. This increase was partially offset by a decrease in “Termination Fees,” which totaled $3.9 million for the year ended December 31, 2008 as compared to $4.2 million for the year ended December 31, 2007. Termination Fees are fees that the Company agrees 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 reconciliation to net income). The following table identifies changes in reportable segments (dollars in thousands):

Property Level Operating Income:

	Year Ended December 31,				Percentage
	2008		2007		Increase (Decrease)
Northeast
– Southeastern PA	$	120,778	$	115,192		4.8	%
– Lehigh/Central PA		70,792		66,799		6.0	% (1)
– New Jersey		23,156		26,934		(14.0	%) (2)
Midwest		51,890		52,865		(1.8	%)
Mid-Atlantic		100,891		90,075		12.0	% (3)
South		115,329		100,274		15.0	% (3)
Philadelphia		21,635		14,585		48.3	% (4)
United Kingdom		3,295		2,682		22.9	% (5)
Total property level operating income (6)	$	507,766	$	469,406		8.2	%

(1)	The increase for the year ended December 31, 2008 versus the year ended December 31, 2007 was primarily due to an increase in average gross investment in operating real estate and an increase in rental rates. This increase was partially offset by a decrease in occupancy during 2008.
(2)	The decrease for the year ended December 31, 2008 versus the year ended December 31, 2007 was primarily due to a decrease in occupancy. This decrease was partially offset by an increase in average gross investment in operating real estate and an increase in rental rates during 2008.
(3)	The increase for the year ended December 31, 2008 versus the year ended December 31, 2007 was primarily due to an increase in average gross investment in operating real estate, an increase in rental rates and an increase in occupancy during 2008 compared to 2007.
(4)	The increase for the year ended December 31, 2008 versus the year ended December 31, 2007 was primarily due to the effect of Comcast Center operation during the relevant periods. Comcast Center was a wholly owned 1.25 million square foot development property which came into service incrementally from the third quarter of 2007 through the first quarter of 2008.
(5)	The increase for the year ended December 31, 2008 versus the year ended December 31, 2007 was primarily due to an increase in average gross investment in operating real estate. This increase was partially offset by a decrease in occupancy, a decrease in the foreign exchange rate, and a decrease in rental rates during 2008.
(6)	See a reconciliation of property level operating income to net income in the Same Store comparison below.

11

Same Store

Property level operating income, exclusive of Termination Fees, for the Same Store properties decreased to $438.2 million for the year ended December 31, 2008 from $440.9 million for the year ended December 31, 2007, on a straight line basis (which recognizes rental revenue evenly over the life of the lease), and decreased to $433.1 million for the year ended December 31, 2008 from $433.9 million for the year ended December 31, 2007 on a cash basis. These decreases of 0.6% and 0.2%, respectively, are primarily due to a decrease 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 and Same Store cash basis 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 590 properties totaling approximately 53.4 million square feet owned on January 1, 2007 and excluding properties sold through December 31, 2008.

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, 2008 and 2007. Same Store property level operating income and cash basis property level operating income are non-GAAP measures and do not represent income before property dispositions, income taxes and equity in earnings of unconsolidated joint ventures because they do 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 and cash basis property level operating income to net income (in thousands).

	Year Ended December 31,
	2008			2007
Same Store:
Rental revenue	$	447,731		$	448,489
Operating expenses:
Rental property expense		144,362			142,332
Real estate taxes		75,360			66,778
Operating expense recovery		(210,151	)		(201,520	)
Unrecovered operating expenses		9,571			7,590
Property level operating income		438,160			440,899
Less straight line rent		5,102			6,977
Cash basis property level operating income	$	433,058		$	433,922
Reconciliation of non-GAAP financial measure – Same Store:
Cash basis property level operating income	$	433,058		$	433,922
Straight line rent		5,102			6,977
Property level operating income		438,160			440,899
Property level operating income – properties purchased or developed subsequent to January 1, 2007		69,776			27,644
Less: Property level operating income – properties held for sale at December 31, 2008		(2,377	)		(2,084	)
Less: Property level operating income – 2009 discontinued operations		(1,648	)		(1,216	)
Termination fees		3,855			4,163
General and administrative expense		(54,387	)		(54,334	)
Depreciation and amortization expense		(172,594	)		(155,248	)
Other income (expense)		(139,176	)		(114,987	)
Gain on property dispositions		10,572			1,463
Income taxes		(1,645	)		709
Equity in earnings (loss) of unconsolidated joint ventures		2,805			(226	)
Discontinued operations at December 31, 2008		26,081			42,938
2009 discontinued operations		684			589
Net income	$	180,106		$	190,310

12

General and Administrative

General and administrative expenses were relatively unchanged with an expense of $54.4 million for the year ended December 31, 2008 compared to $54.3 million for the year ended December 31, 2007. Minor increases in compensation expense were offset by minor decreases in expenses for marketing and consulting services.

Depreciation and Amortization

Depreciation and amortization increased to $172.6 million for the year ended December 31, 2008 from $155.2 million for the year ended December 31, 2007. The increase was primarily due to the increase in average gross investment in operating real estate during the respective periods and particularly the increased investment in tenant improvement costs, which are depreciated over a shorter period than buildings.

Interest Expense

Interest expense increased to $155.2 million for the year ended December 31, 2008 from $126.7 million for the year ended December 31, 2007. This increase was related to an increase in the average debt outstanding, which was $2,833.9 million for the year ended December 31, 2008, compared to $2,677.9 million for the year ended December 31, 2007. The effect of the increase in the average debt outstanding was partially offset by a decrease in the weighted average interest rate to 6.1% for the year ended December 31, 2008 from 6.5% for the year ended December 31, 2007. Also contributing to the increase in interest expense was the decrease in interest that was capitalized due to the decrease in development activity.

Interest expense allocated to discontinued operations for the years ended December 31, 2008 and 2007 was $2.7 million and $7.3 million, respectively. This decrease was due to the decrease in the level of dispositions in 2008 compared to 2007.

Other

Gain on property dispositions increased to $10.6 million for the year ended December 31, 2008 from $1.5 million for the year ended December 31, 2007. The increase was primarily due to recognition of gain on the sale of Comcast Center into a joint venture in which the Company retains an interest (see Note 4 to the Company’s Consolidated Financial Statements).

During the fourth quarter of 2008, the Company purchased $23.4 million principal amount of its August 2010 Senior Notes. These notes were purchased at a $2.5 million discount. The discount is included in net income as a loan extinguishment gain.

Income from discontinued operations decreased to $26.8 million from $43.5 million for the year ended December 31, 2008 compared to the year ended December 31, 2007. The decrease is due to lower operating income and the decrease in gains recognized on sales which were $23.5 million for the year ended December 31, 2008 compared to $33.6 million for the year ended December 31, 2007.

As a result of the foregoing, the Company’s net income decreased to $180.1 million for the year ended December 31, 2008 from $190.3 million for the year ended December 31, 2007.

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

Overview

The Company’s average gross investment in operating real estate owned for the year ended December 31, 2007 increased to $4,514.9 million from $3,797.8 million for the year ended December 31, 2006. This increase in operating real estate resulted in increases in rental revenue, operating expense reimbursement, rental property operating expenses, real estate taxes and depreciation and amortization expense.

Total operating revenue increased to $684.9 million for the year ended December 31, 2007 from $605.8 million for the year ended December 31, 2006. This $79.1 million increase was primarily due to the increase in investment in operating real estate and the increase in operating revenue from the Prior Year Same Store group of properties, discussed below. These increases were partially offset by a decrease in Termination Fees, which totaled $4.2 million for the year ended December 31, 2007 as compared to $6.1 million for the year ended December 31, 2006. Termination Fees are included in rental revenue.

13

Segments

The Company evaluates the performance of the Properties in Operation by reportable segment (see Note 13 to the Company’s Consolidated 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
	2007		2006		Increase (Decrease)
Northeast
– Southeastern PA	$	115,192	$	114,046		1.0	%
– Lehigh/Central PA		66,799		62,222		7.4	% (1)
– New Jersey		26,934		26,456		1.8	%
Midwest		52,865		49,214		7.4	% (2)
Mid-Atlantic		90,075		80,668		11.7	% (2)
South		100,274		76,525		31.0	% (2)
Philadelphia		14,585		8,916		63.6	% (3)
United Kingdom		2,682		906		196.0	% (4)
Total property level operating income (5)	$	469,406	$	418,953		12.0	%

(1)	The increase for the year ended December 31, 2007 versus the year ended December 31, 2006 was primarily due to an increase in average gross investment in operating real estate. This increase was partially offset by a decrease in occupancy and a decrease in rental rates during 2007.
(2)	The increase for the year ended December 31, 2007 versus the year ended December 31, 2006 is primarily due to an increase in average gross investment in operating real estate and an increase in occupancy. This increase was partially offset by a decrease in rental rates during 2007.
(3)	The increase for the year ended December 31, 2007 versus the year ended December 31, 2006 was due to the effect of Comcast Center operation during the relevant periods. Comcast Center was a wholly owned 1.25 million square foot development property which came into service incrementally from the third quarter of 2007 through the first quarter of 2008.
(4)	The increase for the year ended December 31, 2007 versus the year ended December 31, 2006 was primarily due to an increase in average gross investment in operating real estate, an increase in rental rates and an increase in occupancy in 2007 compared to 2006.
(5)	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 “Prior Year Same Store” (as defined below) properties increased to $408.3 million for the year ended December 31, 2007 from $399.3 million for the year ended December 31, 2006, on a straight line basis and increased to $406.2 million for the year ended December 31, 2007 from $394.2 million for the year ended December 31, 2006 on a cash basis. These increases of 2.3% and 3.1%, respectively, were primarily due to an increase in occupancy and an increase in rental rates.

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 and Prior Year Same Store cash basis 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 561 properties totaling approximately 50.2 million square feet owned on January 1, 2006 and excluding properties sold through December 31 2007.

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, 2007 and 2006. Prior Year Same Store property level operating income and Prior Year Same Store cash basis property level operating income are non-GAAP measures and do not represent income before property dispositions, income taxes and equity in earnings of unconsolidated joint ventures because they do 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 and cash basis property level operating income to net income (in thousands).

14

	Year Ended December 31,
	2007			2006
Prior Year Same Store:
Rental revenue	$	414,197		$	406,063
Operating expenses:
Rental property expense		131,698			123,156
Real estate taxes		62,157			61,294
Operating expense recovery		(188,006	)		(177,680	)
Unrecovered operating expenses		5,849			6,770
Property level operating income		408,348			399,293
Less straight line rent		2,111			5,091
Cash basis property level operating income	$	406,237		$	394,202
Reconciliation of non-GAAP financial measure – Same Store:
Cash basis property level operating income	$	406,237		$	394,202
Straight line rent		2,111			5,091
Property level operating income – prior year Same Store		408,348			399,293
Property level operating income – properties purchased or developed subsequent to January 1, 2006		65,110			21,352
Less: Property level operating income – 2008/2009 discontinued operations		(8,217	)		(7,754	)
Termination fees		4,165			6,062
General and administrative expense		(54,334	)		(46,358	)
Depreciation and amortization expense		(155,248	)		(131,822	)
Other income (expense)		(114,987	)		(100,575	)
Gain on property dispositions		1,463			17,628
Income taxes		709			(288	)
Equity in (loss) earnings of unconsolidated joint ventures		(226	)		1,432
Discontinued operations at December 31, 2007		40,762			129,954
2008/2009 discontinued operations		2,765			3,119
Net income	$	190,310		$	292,043

General and Administrative

General and administrative expenses increased to $54.3 million for the year ended December 31, 2007 from $46.4 million for the year ended December 31, 2006. 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 costs relating to the acquisition of Republic and an increase in cancelled project costs.

Depreciation and Amortization

Depreciation and amortization increased to $155.2 million for the year ended December 31, 2007 from $131.8 million for the year ended December 31, 2006. 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 depreciated over a relatively shorter period than buildings.

Interest Expense

Interest expense increased to $126.7 million for the year ended December 31, 2007 from $109.3 million for the year ended December 31, 2006. This increase was related to an increase in the average debt outstanding, which was $2,677.9 million for the year ended December 31, 2007, compared to $2,263.9 million for the year ended December 31, 2006. The effect of the increase in the average debt outstanding was partially offset by an increase in capitalized interest costs and a decrease in the weighted average interest rate to 6.5% for the year ended December 31, 2007 from 6.6% for the year ended December 31, 2006.

Interest expense allocated to discontinued operations for the years ended December 31, 2007 and 2006 was $7.3 million and $15.0 million, respectively. This decrease was due to the decrease in the level of dispositions in 2007 compared to 2006.

15

Other

Gain on property dispositions decreased to $1.5 million for the year ended December 31, 2007 from $17.6 million for the year ended December 31, 2006. The decrease was due to a gain on sale of properties to an unconsolidated joint venture during the year ended December 31, 2006. There was no similar transaction in 2007.

Income from discontinued operations decreased to $43.5 million from $133.1 million for the year ended December 31, 2007 compared to the year ended December 31, 2006. The decrease is due to lower operating income and the decrease in gains recognized on sales which were $33.6 million for the year ended December 31, 2007 compared to $112.6 million for the year ended December 31, 2006.

As a result of the foregoing, the Company’s net income decreased to $190.3 million for the year ended December 31, 2007 from $292.0 million for the year ended December 31, 2006.

Liquidity and Capital Resources

Overview

The uncertainty in the global credit markets has negatively affected the unsecured debt markets. As a result, the Company will be more reliant on the secured debt market as a source of financing in 2009. The Company anticipates that it will need approximately $150 million during 2009 to complete its December 31, 2008 development pipeline and to fund 2009 development starts. The Company’s 2009 debt maturities total approximately $320 million. The Company believes that proceeds from asset sales and from secured debt financing will provide it with sufficient funds to satisfy these obligations. The Company expects to realize approximately $125 million to $200 million in proceeds from asset sales in 2009. From January 1, 2009 through May 19, 2009, the Company has sold 11 Properties in Operation and one parcel of land for $64.9 million and it has closed on $317.4 million in secured debt financings.

Activity

As of December 31, 2008, the Company had cash and cash equivalents of $55.5 million, including $39.7 million in restricted cash.

Net cash flow provided by operating activities decreased to $268.5 million for the year ended December 31, 2008 from $346.8 million for the year ended December 31, 2007. This $78.3 million decrease was primarily due to a change in restricted cash and the timing of payments on account. The change in restricted cash is due to the release of restricted funds in the United Kingdom for the payment of infrastructure costs. Net cash flow provided by operating activities 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 Wholly Owned Properties in Operation.

Net cash provided by investing activities was $52.6 million for the year ended December 31, 2008 compared to net cash used of $758.9 million for the year ended December 31, 2007. This $811.5 million change primarily resulted from a decrease in investment in unconsolidated joint ventures in 2008 compared to an increase in 2007 due to the investment in the Blythe Valley joint venture. There was also a decrease in investment in properties, development in progress and land held for development.

Net cash used in financing activities was $333.8 million for the year ended December 31, 2008 compared to net cash provided of $396.3 million for the year ended December 31, 2007. This $730.1 million change was primarily due to the decreased net borrowings on unsecured debt including unsecured notes and the credit facility during the year ended December 31, 2008 due to decreased investment activity during 2008. Net cash provided by or used in financing activities includes proceeds from the issuance of equity and debt, net of debt repayments and equity repurchases and shareholder distributions. 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 and proceeds from the disposition of properties. For the year ended December 31, 2008, 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 Credit

16

Facility expires in January 2010, and has a one-year extension option. The fee for the one-year extension is $900,000.

Additionally, the Company has entered into an agreement to fund its planned improvements for the Kings Hill Phase 2 land development project. At December 31, 2008, the Company had drawn £1.8 million ($2.7 million) from a £7.0 million ($10.2 million) revolving credit facility. The facility expires on November 22, 2011.

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, 2008 the Company’s debt to gross assets ratio was 41.8%, and for the year ended December 31, 2008, the fixed charge coverage ratio was 2.4x. Debt to gross assets equals total long-term debt, borrowings under the Credit Facility divided by total assets plus accumulated depreciation. The fixed charge coverage ratio equals income from continuing operations before property dispositions 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, 2008, $198.6 million in mortgage loans and $2,131.6 million in unsecured notes were outstanding with a weighted average interest rate of 6.6%. The interest rates on $2,327.5 million of mortgage loans and unsecured notes are fixed and range from 5.0% to 8.8%. The weighted average remaining term for these mortgage loans and unsecured notes is 4.9 years.

The Company’s contractual obligations, as of December 31, 2008, 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)	$	3,299,597	$	459,053	$	936,021	$	443,029	$	1,461,494
Capital lease obligations		5,084		407		362		376		3,939
Operating lease obligations		18,810		1,307		1,732		1,430		14,341
Share of debt of unconsolidated joint ventures (1)		391,675		43,996		61,953		83,838		201,888
Property development commitments		128,137		109,643		18,494		—		—
Share of property development commitments of unconsolidated joint ventures		16,919		16,162		757		—		—
Joint venture capital commitments		3,823		—		2,510		1,313		—
Letter of credit		1,985		562		1,423		—		—
Share of letter of credit of unconsolidated joint ventures		1,250		1,250		—		—		—
Purchase obligations (2)		17,597		17,597		—		—		—
Comcast Center net operating income support		42		42		—		—		—
Total	$	3,884,919	$	650,019	$	1,023,252	$	529,986	$	1,681,662

(1)	Includes principal and interest payments. Interest payments assume $600 million Credit Facility borrowings and interest rates remain at the December 31, 2008 level until maturity.
(2)	Purchase obligations refer to obligations to acquire land.

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 secured financing of properties, proceeds from property dispositions, equity capital from joint venture partners and net cash provided by operating activities. Additionally, the Company expects to incur variable rate debt, including borrowings under the $600 million Credit Facility, from time to time.

In June 2007, the Company redeemed for $23.7 million its outstanding 7.63% Series D Cumulative Redeemable Preferred Units. The redemption resulted in a $0.7 million write-off of Series D issuance costs.

17

In August 2007, the Company raised $100 million through the placement of 7.40% Series H Cumulative Redeemable Preferred Units. The net proceeds from this offering were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes. Amounts repaid under the $600 million Credit Facility were subsequently drawn to pay a portion of the cash merger consideration for the purchase of Republic Property Trust.

In August and September 2007, the Company satisfied a $100 million 7.25% senior unsecured note and issued a $300 million 6.625% senior unsecured note due 2017. The net proceeds of the $300 million offering were $296.2 million and were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes. Amounts repaid under the $600 million Credit Facility were subsequently drawn to pay a portion of the cash merger consideration for the purchase of Republic Property Trust.

On March 31, 2008, a $324 million 6.15% secured ten-year financing for Comcast Center was funded. The proceeds from this financing were used to pay down outstanding borrowings on the $600 million Credit Facility.

In October 2008, the Company sold 4,750,000 Common Shares. The net proceeds of the offering of $149.5 million were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

In December 2008, the Company purchased $23.4 million of its 8.5% August 2010 senior unsecured notes. This purchase resulted in a $2.5 million loan extinguishment gain.

In January 2009, the Company satisfied a $20 million 8.125% senior unsecured note. In April 2009, the Company satisfied a $238.6 million 7.75% senior unsecured note.

During the period from January 1, 2009 through May 19, 2009, the Company closed on mortgages totaling $317.4 million bearing interest at an average rate of 7.1%. The net proceeds of the financing transactions were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

In December 2008, the Company commenced the sale of up to $150.0 million of Common Shares pursuant to a continuous offering program. Through December 31, 2008, the Company sold 495,000 Common Shares as part of this program. From January 1, 2009 through May 19, 2009, the Company sold an additional 6.0 million Common Shares through this program. The net proceeds from the offering of $10.8 million through December 31, 2008 and of $121.7 million from January 1, 2009 through May 19, 2009 were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes. Through May 19, 2009, the Company paid Citigroup Global Markets, Inc., its agent under this program, an aggregate of $2.7 million in fees with respect to the Common Shares sold through this program.

In April, 2009, the Company’s Board of Trustees approved the expansion of the Company’s continuous offering program. In addition to the original program, the expansion allows for the sale of an additional $150 million in common shares.

In November 2008, the quarterly Common Share dividend was decreased to $0.475 per share from $0.625 per share. The Company’s annual Common Share dividend paid was $2.50 per share, $2.485 per share, and $2.465 per share in 2008, 2007, and 2006, respectively. In 2008, the Company’s dividend payout ratio was approximately 78.1% of Funds from operations (as defined below).

The Company has an effective S-3 shelf registration statement on file with the SEC pursuant to which the Trust and the Operating Partnership may issue an unlimited amount of equity securities and debt securities.

Off-Balance Sheet Arrangements

As of December 31, 2008, the Company had investments in and advances to unconsolidated joint ventures totaling $266.6 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

18

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.

Funds from operations (“FFO”) available to common shareholders for the years ended December 31, 2008, 2007, and 2006 are as follows (in thousands, except per share amounts):

	Year Ended December 31,
	2008			2007			2006
Reconciliation of net income to FFO – basic
Net income	$	151,942		$	164,831		$	266,574
Basic — income available to common shareholders		151,942			164,831			266,574
Basic – income available to common shareholders per weighted average share	$	1.62		$	1.81		$	2.98
Adjustments:
Depreciation and amortization of unconsolidated joint ventures		16,235			6,494			2,871
Depreciation and amortization		173,400			162,833			149,606
Gain on property dispositions		(34,336	)		(36,498	)		(136,036	)
Noncontrolling interest share in addback for depreciation and amortization and gain on property dispositions		(6,606	)		(5,820	)		(877	)
Funds from operations available to common shareholders — basic	$	300,635		$	291,840		$	282,138
Basic Funds from operations available to common shareholders per weighted average share	$	3.21		$	3.20		$	3.16
Reconciliation of net income to FFO – diluted
Net income	$	151,942		$	164,831		$	266,574
Diluted – income available to common shareholders		151,942			164,831			266,574
Diluted – income available to common shareholders per weighted average share	$	1.62		$	1.80		$	2.95
Adjustments:
Depreciation and amortization of unconsolidated joint ventures		16,235			6,494			2,871
Depreciation and amortization		173,400			162,833			149,606
Gain on property dispositions		(34,336	)		(36,498	)		(136,036	)
Noncontrolling interest less preferred share distributions and excess of preferred unit redemption over carrying amount		6,669			7,556			11,786
Funds from operations available to common shareholders – diluted	$	313,910		$	305,216		$	294,801
Diluted Funds from operations available to common shareholders per weighted average share	$	3.20		$	3.18		$	3.12
Reconciliation of weighted average shares:
Weighted average Common Shares – all basic calculations		93,624			91,185			89,313
Dilutive shares for long term compensation plans		180			618			1,179
Diluted shares for net income calculations		93,804			91,803			90,492
Weighted average common units		4,190			4,190			3,895
Diluted shares for Funds from operations calculations		97,994			95,993			94,387

19

Inflation

Inflation has remained relatively low in recent years, and as a result, it has not had a significant impact on the Company during this period. Through the early part of 2008, there was a dramatic increase in the price of oil and other commodities; such an increase, if it were to recommence, could result in an increase in inflation. However, weakness in the national and global economies has resulted in Federal Reserve Board action designed to discourage increases in interest rates. To the extent an increase in inflation would result in increased operating costs, such as 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.

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.

20

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, 2008 and 2007, and the related consolidated statements of operations, equity, and cash flows for each of the three years in the period ended December 31, 2008. 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 financial statements referred to above present fairly, in all material respects, the consolidated financial position of Liberty Property Trust at December 31, 2008 and 2007, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2008, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in Note 16, these consolidated financial statements have been revised to give effect to certain adjustments.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Liberty Property Trust’s internal control over financial reporting as of December 31, 2008, 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 25, 2009 (not provided herein) expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania

February 25, 2009 except for Notes 2, 8, 13,14, 15 and 16, as to which the date is May 19, 2009.

21

CONSOLIDATED BALANCE SHEETS OF LIBERTY PROPERTY TRUST
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

	December 31,
	2008			2007
ASSETS
Real estate:
Land and land improvements	$	813,397		$	792,991
Buildings and improvements		4,260,121			4,408,309
Less accumulated depreciation		(982,114	)		(858,671	)
Operating real estate		4,091,404			4,342,629
Development in progress		245,463			316,985
Land held for development		209,551			247,124
Net real estate		4,546,418			4,906,738
Cash and cash equivalents		15,794			37,989
Restricted cash		39,726			34,567
Accounts receivable, net		12,985			15,908
Deferred rent receivable		85,352			79,720
Deferred financing and leasing costs, net		134,029			144,295
Investments in and advances to unconsolidated joint ventures		266,602			278,383
Assets held for sale		33,662			36,908
Prepaid expenses and other assets		82,467			109,429
Total assets	$	5,217,035		$	5,643,937
LIABILITIES
Mortgage loans	$	198,560		$	243,169
Unsecured notes		2,131,607			2,155,000
Credit facility		260,000			622,960
Accounts payable		32,481			44,666
Accrued interest		36,474			39,725
Dividends and distributions payable		48,858			59,849
Other liabilities		182,549			268,926
Total liabilities		2,890,529			3,434,295
EQUITY
Common shares of beneficial interest, $.001 par value, 183,987,000 shares authorized, 100,034,404 (includes 1,249,909 in treasury) and 92,817,879 (includes 1,249,909 in treasury) shares issued and outstanding as of December 31, 2008 and 2007, respectively		101			93
Additional paid-in capital		2,162,820			1,947,453
Accumulated other comprehensive (loss) income		(5,378	)		21,378
Distributions in excess of net income		(185,721	)		(116,640	)
Common Shares held in treasury, at cost, 1,249,909 shares as of December 31, 2008 and 2007		(51,951	)		(51,951	)
Total Liberty Property Trust shareholders’ equity		1,919,871			1,800,333
Noncontrolling interest-operating partnership, 4,074,967 and 4,189,967 common units outstanding as of December 31, 2008 and 2007, respectively, and 9,740,000 preferred units outstanding as of December 31, 2008 and 2007		405,505			408,792
Noncontrolling interest-consolidated joint ventures		1,130			517
Total equity		2,326,506			2,209,642
Total liabilities and equity	$	5,217,035		$	5,643,937

See accompanying notes.

22

CONSOLIDATED STATEMENTS OF OPERATIONS OF LIBERTY PROPERTY TRUST
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

	Year Ended December 31,
	2008			2007			2006
OPERATING REVENUE
Rental	$	518,507		$	478,814		$	425,680
Operating expense reimbursement		227,501			206,071			180,140
Total operating revenue		746,008			684,885			605,820
OPERATING EXPENSE
Rental property		152,227			143,183			122,454
Real estate taxes		86,015			72,296			64,413
General and administrative		54,387			54,334			46,358
Depreciation and amortization		172,594			155,248			131,822
Total operating expenses		465,223			425,061			365,047
Operating income		280,785			259,824			240,773
OTHER INCOME (EXPENSE)
Interest and other income		13,501			11,720			8,690
Debt extinguishment gain		2,521			—			—
Interest expense		(155,198	)		(126,707	)		(109,265	)
Total other income (expense)		(139,176	)		(114,987	)		(100,575	)
Income before property dispositions, income taxes and equity in earnings (loss) of unconsolidated joint ventures		141,609			144,837			140,198
Gain on property dispositions		10,572			1,463			17,628
Income taxes		(1,645	)		709			(288	)
Equity in earnings (loss) of unconsolidated joint ventures		2,805			(226	)		1,432
Income from continuing operations		153,341			146,783			158,970
Discontinued operations (including net gain on property dispositions of $23,519, $33,611, and $112,620 for the years ended December 31, 2008, 2007 and 2006, respectively)		26,765			43,527			133,073
Net income	$	180,106		$	190,310		$	292,043
Noncontrolling interest-operating partnership		(27,681	)		(25,378	)		(25,476	)
Noncontrolling interest-consolidated joint ventures		(483	)		(101	)		7
Net income available to common shareholders	$	151,942		$	164,831		$	266,574
Earnings per share
Basic:
Income from continuing operations	$	1.35		$	1.35		$	1.55
Income from discontinued operations		0.27			0.46			1.43
Income per common share – basic	$	1.62		$	1.81		$	2.98
Diluted:
Income from continuing operations	$	1.35		$	1.35		$	1.54
Income from discontinued operations		0.27			0.45			1.41
Income per common share – diluted	$	1.62		$	1.80		$	2.95
Weighted average number of Common Shares outstanding
Basic		93,624			91,185			89,313
Diluted		93,804			91,803			90,492
Amounts attributable to common shareholders
Income from continuing operations	$	126,308		$	123,210		$	139,197
Discontinued operations		25,634			41,621			127,377
Net income available to common shareholders	$	151,942		$	164,831		$	266,574

See accompanying notes.

23

CONSOLIDATED STATEMENTS OF EQUITY
(IN THOUSANDS)

						Accumulated						Common			Total						Noncontroll-
	Common					Other						Shares			Liberty			Noncontroll-			ing Interest-
	Shares of		Additional			Comprehensive			Distributions			Held			Property Trust			ing interest-			consolidated
	Beneficial		Paid-In			Income			in Excess of			in			Shareholders’			operating			joint			Total
	Interest		Capital			(loss)			Net Income			Treasury			Equity			partnership			ventures			Equity
Balance at January 1, 2006	$	88	$	1,716,417		$	9,906		$	(98,553	)	$	(1,327	)	$	1,626,531		$	335,377		$	407		$	1,962,315
Net proceeds from the issuance of Common Shares		3		87,040			—			—			—			87,043			—			—			87,043
Net proceeds from the issuance of noncontrolling interest-common units		—		—			—			—			—			—			30,000			—			30,000
Net proceeds from the issuance of noncontrolling interest-preferred units		—		—			—			—			—			—			26,305			—			26,305
Net income		—		—			—			266,574			—			266,574			25,476			(7	)		292,043
Distributions		—		—			—			(221,907	)		—			(221,907	)		(23,116	)		19			(245,004	)
Noncash compensation		—		6,212			—			—			—			6,212			—			—			6,212
Foreign currency translation adjustment		—		—			10,417			—			—			10,417			—			—			10,417
Redemption of noncontrolling interests for common shares		—		(22,811	)		—			—			—			(22,811	)		22,811			—			—
Balance at December 31, 2006		91		1,786,858			20,323			(53,886	)		(1,327	)		1,752,059			416,853			419			2,169,331
Net proceeds from the issuance of Common Shares		2		70,363			—			—			—			70,365			—			—			70,365
Net proceeds from the issuance of noncontrolling interest-preferred units		—		—			—			—			—			—			99,964			—			99,964
Net income		—		—			—			164,831			—			164,831			25,378			101			190,310
Distributions		—		—			—			(227,585	)		—			(227,585	)		(28,340	)		(3	)		(255,928	)
Purchase of treasury shares		—		—			—			—			(50,624	)		(50,624	)		—			—			(50,624	)
Noncash compensation		—		8,128			—			—			—			8,128			—			—			8,128
Foreign currency translation adjustment		—		—			1,055			—			—			1,055									1,055
Redemption of noncontrolling interest-preferred units		—		—			—			—			—			—			(22,959	)		—			(22,959	)
Redemption of noncontrolling interests for common shares		—		82,104			—			—			—			82,104			(82,104	)		—			—
Balance at December 31, 2007		93		1,947,453			21,378			(116,640	)		(51,951	)		1,800,333			408,792			517			2,209,642
Net proceeds from the issuance of Common Shares		8		206,215			—			—			—			206,223			—			—			206,223
Net income		—		—			—			151,942			—			151,942			27,681			483			180,106
Distributions		—		—			—			(221,023	)		—			(221,023	)		(30,968	)		130			(251,861	)
Noncash compensation		—		9,152			—			—			—			9,152			—			—			9,152
Foreign currency translation adjustment		—		—			(26,756	)		—			—			(26,756	)		—			—			(26,756	)
Balance at December 31, 2008	$	101	$	2,162,820		$	(5,378	)	$	(185,721	)	$	(51,951	)	$	$1,919,871		$	405,505		$	1,130		$	2,326,506

See accompanying notes.

24

CONSOLIDATED STATEMENTS OF CASH FLOWS OF LIBERTY PROPERTY TRUST
(IN THOUSANDS)

	Year Ended December 31,
	2008			2007			2006
OPERATING ACTIVITIES
Net income	$	180,106		$	190,310		$	292,043
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		175,236			163,665			151,966
Amortization of deferred financing costs		4,429			4,137			4,244
Equity in (earnings) loss of unconsolidated joint ventures		(2,805	)		226			(1,432	)
Distributions from unconsolidated joint ventures		1,660			3,550			5,692
Gain on property dispositions		(34,091	)		(35,074	)		(130,248	)
Noncash compensation		9,152			8,128			6,212
Changes in operating assets and liabilities:
Restricted cash		(10,903	)		26,211			(21,692	)
Accounts receivable		(4,277	)		4,634			(6,879	)
Deferred rent receivable		(13,482	)		(13,455	)		924
Prepaid expenses and other assets		(26,326	)		(14,145	)		(14,394	)
Accounts payable		(10,913	)		3,974			7,648
Accrued interest		(3,251	)		3,428			1,405
Other liabilities		3,935			1,163			29,084
Net cash provided by operating activities		268,470			346,752			324,573
INVESTING ACTIVITIES
Investment in properties		(60,078	)		(307,846	)		(372,610	)
Cash paid for business, net of cash acquired		—			(626,007	)		—
Investments in and advances to unconsolidated joint ventures		58,250			(227,385	)		(6,239	)
Net proceeds from disposition of properties/land		382,956			996,474			492,548
Investment in development in progress		(247,393	)		(417,877	)		(339,631	)
Investment in land held for development		(47,857	)		(137,051	)		(79,976	)
Increase in deferred leasing costs		(33,325	)		(39,232	)		(29,034	)
Net cash provided by (used in) investing activities		52,553			(758,924	)		(334,942	)
FINANCING ACTIVITIES
Net proceeds from issuance of Common Shares		206,349			70,355			87,043
Purchase of treasury shares		—			(50,624	)		—
Net proceeds from issuance of preferred units		—			99,958			26,305
Redemption of preferred units		—			(23,653	)		—
Net proceeds from issuance of notes payable		—			415,063			—
Repayments of notes payable		—			(415,063	)		—
Net proceeds from issuance of unsecured notes		—			446,205			295,393
Repayments of unsecured notes		(23,393	)		(250,000	)		(100,000	)
Proceeds from mortgage loans		2,667			—			—
Repayments of mortgage loans		(46,452	)		(16,365	)		(56,406	)
Proceeds from credit facility		572,300			1,363,050			725,025
Repayments on credit facility		(782,300	)		(987,050	)		(733,515	)
Increase in deferred financing costs		(33	)		(1,224	)		(1,635	)
Distributions paid on Common Shares		(231,325	)		(226,718	)		(219,873	)
Distributions paid on units		(31,648	)		(27,612	)		(22,664	)
Net cash (used in) provided by financing activities		(333,835	)		396,322			(327	)
Decrease in cash and cash equivalents		(12,812	)		(15,850	)		(10,696	)
(Decrease) increase in cash and cash equivalents related to foreign currency translation		(9,383	)		102			2,804
Cash and cash equivalents at beginning of year		37,989			53,737			61,629
Cash and cash equivalents at end of year	$	15,794		$	37,989		$	53,737
SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS
Write-off of fully depreciated property and deferred costs	$	31,421		$	102,902		$	87,424
Issuance of operating partnership common units		—			—			30,000
Acquisition of properties		—			(73,556	)		(3,066	)
Assumption of mortgage loans		—			73,556			3,066

See accompanying notes.

25

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 96.0% of the common equity of the Operating Partnership at December 31, 2008. 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, Midwestern and Southwestern United States and the United Kingdom.

All square footage amounts are unaudited.

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 noncontrolling 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)
Capital improvements	15 – 20 years
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 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 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 intangibles 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.

26

The Company evaluates its real estate investments 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 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.

On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated joint ventures may be impaired. An investment is impaired only if management’s estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the estimated fair value of the investment.

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/Deferred Rent 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 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.

The allowance for doubtful accounts at December 31, 2008 and 2007 was $8.5 million and $6.0 million, respectively.

Goodwill

Goodwill represents the amounts paid in excess of the fair value of the net assets acquired from business acquisitions accounted for under SFAS No. 141, “Business Combinations”. Pursuant to SFAS No. 142,“Accounting for Goodwill and Intangible Assets”(“SFAS 142”) goodwill is not amortized to expense but rather is analyzed for impairment. In conjunction with the purchase of Republic, goodwill of $15.3 million was recorded. The goodwill is assigned to the Northern Virginia/Washington, D.C. operation (“reporting unit”) which is part of the Philadelphia reportable segment and is included in prepaid expenses and other assets on the Company’s consolidated balance sheets. The Company assesses goodwill for impairment annually in November and in interim periods if certain events occur indicating the carrying value may be impaired. The Company performs its analysis for potential impairment of goodwill in accordance with SFAS 142, which requires that a two-step impairment test be performed on goodwill. In the first step, the fair value of the reporting unit is compared to its carrying value. If the fair value exceeds its carrying value, goodwill is not impaired, and no further testing is required. If the carrying value of the reporting unit exceeds its fair value, then a second step must be performed in order to determine the implied fair value of the goodwill and compare it to the carrying value of the goodwill. If the carrying value of goodwill exceeds its implied fair value then an impairment loss is recorded equal to the difference. No impairment losses were recognized during the years ended December 31, 2008 or 2007.

27

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)	collectability 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 noncontrolling interest-operating partnership.

Income per Common Share

The following table sets forth the computation of basic and diluted income per common share, updated to reflect discontinued operations as of March 31, 2009 (in thousands, except per share amounts):

	2008						2007
			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 net of noncontrolling interest	$	126,308		93,624	$	1.35	$	123,210		91,185	$	1.35
Dilutive shares for long-term compensation plans		—		180				—		618
Diluted income from continuing operations
Income from continuing operations net of noncontrolling interest and assumed conversions		126,308		93,804	$	1.35		123,210		91,803	$	1.35
Basic income from discontinued operations
Discontinued operations net of noncontrolling interest		25,634		93,624	$	0.27		41,621		91,185	$	0.46
Dilutive shares for long-term compensation plans		—		180				—		618
Diluted income from discontinued operations
Discontinued operations net of noncontrolling interest		25,634		93,804	$	0.27		41,621		91,803	$	0.45
Basic income per common share
Net income available to common shareholders		151,942		93,624	$	1.62		164,831		91,185	$	1.81
Dilutive shares for long-term compensation plans		—		180				—		618
Diluted income per common share
Net income available to common shareholders and assumed conversions	$	151,942		93,804	$	1.62	$	164,831		91,803	$	1.80

28

	2006
			Weighted
			Average
	Income		Shares		Per
	(Numerator)		(Denominator)		Share
Basic income from continuing operations
Income from continuing operations net of noncontrolling interest	$	139,197		89,313	$	1.55
Dilutive shares for long-term compensation plans		—		1,179
Diluted income from continuing operations
Income from continuing operations net of noncontrolling interest and assumed conversions		139,197		90,492	$	1.54
Basic income from discontinued operations
Discontinued operations net of noncontrolling interest		127,377		89,313	$	1.43
Dilutive shares for long-term compensation plans		—		1,179
Diluted income from discontinued operations
Discontinued operations net of noncontrolling interest		127,377		90,492	$	1.41
Basic income per common share
Net income available to common shareholders		266,574		89,313	$	2.98
Dilutive shares for long-term compensation plans		—		1,179
Diluted income per common share
Net income available to common shareholders and assumed conversions	$	266,574		90,492	$	2.95

Dilutive shares for long-term compensation plans represent the vested and unvested Common Shares outstanding during the year as well as the dilutive effect of outstanding options. The anti-dilutive options that were excluded from the computation of diluted income per common share in 2008, 2007 and 2006 were 1,145,000, 629,000 and 103,000, respectively.

Fair Value of Financial Instruments

The carrying value of cash and cash equivalents, restricted cash, accounts 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, 2008 for comparable loans, is less than the aggregate carrying value by approximately $713.1 million at December 31, 2008.

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 100% 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. 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 (including any alternative minimum tax) and may not be able to qualify as a REIT for the four subsequent taxable years. Even as a REIT, the Company may be subject to certain state and local income and property taxes, and to federal income and excise taxes on undistributed taxable income.

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, the United Kingdom, and Luxembourg.  Accordingly, the Company has recognized federal, state and foreign income taxes in accordance with US GAAP, as applicable. 

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.” The Company adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, no uncertain tax positions were identified

29

which would result in the recording of a liability for unrecognized tax benefits, and correspondingly no benefit recognition was identified that would affect the effective tax rate. Additionally, there are no possibly significant unrecognized tax benefits which are reasonably expected to occur within the next 12 months. The Company’s policy is to recognize interest accrued related to unrecognized benefits in interest expense and penalties in other expense. There are no interest and penalties deducted in the current period and no interest and penalties accrued at December 31, 2008 and December 31, 2007.

Certain of the Company’s taxable REIT subsidiaries have net operating loss carryforwards available of approximately $19.3 million.  These carryforwards begin to expire in 2018.  The Company has 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 Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction, certain state and local jurisdictions, the United Kingdom and Luxembourg.  With few exceptions, the Company is no longer subject to U.S. federal, state, and local, or United Kingdom and Luxembourg examinations by tax authorities for years before 2005.

The Federal tax cost basis of the real estate at December 31, 2008 was $5.5 billion and at December 31, 2007 was $5.7 billion.

Share Based Compensation

At December 31, 2008, the Company had share-based employee compensation plans as fully described in Note 10. Effective January 1, 2006 the Company adopted 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 its compensation 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).

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 (loss) income as a separate component of shareholders’ equity. Accumulated other comprehensive (loss) income consists solely of the foreign currency translation adjustments described. Other comprehensive (loss) income was ($26.8) million, $1.1 million and $10.4 million for the years ended December 31, 2008, 2007 and 2006, 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 accumulated other comprehensive income.

Recently Issued Accounting Standards

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 US GAAP and expands disclosures about fair value measurements. The hierarchy is measured in three levels based on the reliability of inputs:

Level 1- Valuations based on quoted prices in active markets for identical assets or liabilities in a market that the Company has the ability to access.
Level 2- Valuations based on quoted prices for similar assets or liabilities, or inputs that are observable, either directly or indirectly, through corroboration with observable market data.
Level 3- Valuations derived from other valuation methodologies, including pricing models, discounted cash flow models, and similar techniques. Level 3 valuations incorporate certain assumptions and projections that are not directly observable in the market and significant professional judgment in determining the fair value assigned to such assets or liabilities.

30

The Company adopted the provisions of SFAS No. 157 on January 1, 2008. The adoption of this statement did not have a material effect on the Company’s financial position or results of operations.

SFAS No. 159

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“SFAS No. 159”). SFAS No. 159 provides companies with an option to report selected financial assets and liabilities at fair value and establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. The Company adopted the provisions of SFAS No. 159 on January 1, 2008. The adoption of this statement did not have a material effect on the Company’s financial position or results of operations.

SFAS No. 141(R)

In December 2007, the FASB issued SFAS No. 141(R), “Applying the Acquisition Method” (“SFAS No. 141(R)”). This statement changes the accounting for acquisitions specifically eliminating the step acquisition model, changing the recognition of contingent consideration from being recognized when it is probable to being recognized at the time of acquisition, disallowing the capitalization of transaction costs and delays when restructurings related to acquisitions can be recognized. SFAS No. 141(R) is effective for fiscal years beginning after December 15, 2008 and will impact the accounting for acquisitions made beginning January 1, 2009. The Company does not anticipate that the adoption of this statement will have a material effect on its financial position or results of operations.

FSP EITF 03-6-1

In June 2008, the FASB issued FASB Staff Position (“FSP”) Emerging Issues Task Force (“EITF”) 03-6-1, “Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities.”  The FSP clarifies that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method.  FSP EITF 03-6-1 is effective for fiscal years beginning after December 15, 2008.  The Company does not anticipate that the adoption of this statement will have a material effect on its financial position or results of operations.

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, 2008 and 2007 is as follows (in thousands):

	Land		Buildings
	And Land		And				Accumulated
	Improvements		Improvements		Total		Depreciation
2008
Industrial properties	$	361,911	$	1,831,862	$	2,193,773	$	433,904
Office properties		451,486		2,428,259		2,879,745		548,210
2008 Total	$	813,397	$	4,260,121	$	5,073,518	$	982,114
2007
Industrial properties	$	337,675	$	1,717,500	$	2,055,175	$	382,241
Office properties		455,316		2,690,809		3,146,125		476,430
2007 Total	$	792,991	$	4,408,309	$	5,201,300	$	858,671

31

Depreciation expense was $147.2 million in 2008, $135.4 million in 2007 and $124.9 million in 2006.

As of December 31, 2008, the Company had commenced development on 17 properties, which upon completion are expected to comprise 3.2 million square feet of leaseable space. As of December 31, 2008, $245.5 million had been expended for the development of these projects and an additional $128.1 million is estimated to be required for completion.

Additionally, unconsolidated joint ventures in which the Company had an interest had commenced development on four properties, which upon completion are expected to comprise 1.4 million square feet of leaseable space. As of December 31, 2008, $135.3 million had been expended for the development of these projects and an additional $51.1 million is estimated to be required for completion.

Information on the operating properties the Company sold during the years ended December 31, 2008 and 2007 is as follows:

2008 Sales

	Number of		Leaseable
Segment	Buildings		Square Feet		Gross Proceeds
					(in thousands)
Northeast
Southeastern PA		2		166,160	$	33,557
New Jersey		5		159,989		15,100
Midwest		3		125,876		9,420
Mid-Atlantic		2		129,150		16,650
Florida		1		83,583		5,300
Total		13		664,758	$	80,027

2007 Sales

	Number of		Leaseable
Segment	Buildings		Square Feet		Gross Proceeds
					(in thousands)
Northeast
Southeastern PA		1		141,714	$	8,650
Lehigh/Central PA		1		289,800		13,775
Midwest		60		4,257,477		317,600
Mid-Atlantic		6		399,258		21,363
Florida		2		152,219		8,152
Total		70		5,240,468	$	369,540

In addition, in 2008, the Company recognized the sale of the 1.25 million square foot Comcast Center to an unconsolidated joint venture. At the time of the sale, 968,000 leaseable square feet were in service and 282,000 square feet were under development. The gross proceeds from the sale were $512 million. See Note 4 below.

4. INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES

Listed below are the unconsolidated joint ventures in which the Company has a noncontrolling interest. The Company receives fees from these joint ventures for services it provides. These services include property management, leasing, development and administration. These fees are included in interest and other income in the accompanying consolidated statements of operations. The Company may also receive a promoted interest if certain return thresholds are met.

Liberty Venture I, LP

The Company has a 25% interest in Liberty Venture I, LP, an entity engaged in the ownership of industrial properties in New Jersey.

As of December 31, 2008, the joint venture owned 24 industrial properties totaling 3.1 million square feet and 43 acres of developable land, as well as a development property that, when completed, is expected to contain an

32

additional 225,000 square feet of leaseable space. The Company has guaranteed cost overruns in excess of the approved project budget for the development property. The Company considers payments under the guarantee unlikely.

The Company recognized $1.5 million, $802,000 and $634,000 in fees for services during the years ended December 31, 2008, 2007 and 2006, respectively.

Kings Hill Unit Trust

The Company has a 20% interest in Kings Hill Unit Trust, an entity engaged in the ownership of office and industrial properties in the County of Kent, United Kingdom.

As of December 31, 2008, the joint venture owned 10 office properties and five industrial properties totaling 536,000 square feet.

The Company holds a $4.1 million note receivable from Kings Hill Unit Trust. The note receivable bears interest at a 9% rate and is due in December 2010.

Income from fees and interest was $764,000, $1.6 million and $1.3 million during the years ended December 31, 2008, 2007 and 2006, respectively.

Liberty/Commerz 1701 JFK Boulevard, LP

On April 13, 2006, the Company entered into a joint venture pursuant to which it sold an 80% interest in the equity of Comcast Center, a 1.25 million square foot office tower the Company was then developing in Philadelphia, Pennsylvania. The transaction valued the property at $512 million. Upon signing the joint venture agreement and through March 30, 2008, the criteria for sale recognition in accordance with SFAS No. 66,“Accounting for the Sales of Real Estate”(“SFAS No. 66”) had not been met and the transaction was accounted for as a financing arrangement.

On March 31, 2008, a $324 million, ten-year secured financing at a 6.15% interest rate for Comcast Center was funded. The proceeds from this financing were used to pay down outstanding borrowings on the Company’s credit facility.

On March 31, 2008, all conditions for sale treatment as outlined in SFAS No. 66 were satisfied and the Company recognized the sale of Comcast Center to an unconsolidated joint venture. Profit on the transaction was deferred until the costs of the project could be reasonably estimated. Profit on the sale of $6.6 million was recognized in the fourth quarter of 2008.

As of December 31, 2008, the Company had a $15.1 million receivable from this joint venture.  This related party receivable is due to the funding of joint venture development costs and is reflected in investments in and advances to unconsolidated joint ventures on the Company’s consolidated balance sheets. 

The Company recognized $883,000 in fees for services during the year ended December 31, 2008.

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 industrial properties totaling 2.1 million square feet and 104 acres of developable land. The joint venture valued the buildings and land at $125.0 million.

As of December 31, 2008, the joint venture owned 14 industrial properties totaling 4.6 million square feet and 364 acres of developable land, as well as a development property that, when completed, is expected to contain an additional 464,000 square feet of leaseable space. The Company has guaranteed cost overruns in excess of the approved project budget for the development property. The Company considers payments under the guarantee unlikely.

The Company recognized $1.2 million, $791,000 and $777,000 in fees for services during the years ended December 31, 2008, 2007 and 2006, respectively.

Blythe Valley JV Sarl

On September 10, 2007, the Company entered into a joint venture to acquire Blythe Valley Park, West Midlands, UK for $325 million. The park consists of 491,000 square feet of office properties and 98 acres of developable land. The

33

Company holds a $5.2 million note receivable from Blythe Valley JV Sarl and has a 20% interest in the joint venture. The note receivable bears interest at a 10% rate and is due in December 2017.

The Company recognized $909,000 and $446,000 in fees for services during the years ended December 31, 2008 and 2007, respectively.

Liberty Washington, LP

On October 4, 2007, the Company acquired Republic Property Trust (“Republic Acquisition”), a Maryland real estate investment trust and Republic Property Limited Partnership, a Delaware limited partnership and Republic’s operating partnership (together, “Republic”) for $916 million. The acquisition of Republic was completed through the merger of Republic with a wholly owned subsidiary of the Company and the merger of Republic’s operating partnership with the Company’s Operating Partnership. Republic operated a portfolio consisting of 2.4 million square feet of office space, six acres of developable land, and a redevelopment property that, when completed, is expected to contain an additional 176,000 square feet of office space in the Northern Virginia and Washington, D.C. markets. The Company has guaranteed cost overruns in excess of the approved project budget for the development property. The Company considers payments under the guarantee unlikely.

Concurrently, the Company formed a joint venture with New York State Common Retirement Fund to own and manage the Republic portfolio (“Republic Disposition”). The joint venture, in which the Company holds a 25% interest, purchased the Republic real estate assets for $900 million. The acquisition of Republic resulted in the Company recording $16 million in goodwill and other intangibles.

The Company had a $59.5 million note receivable from Liberty Washington, LP that was repaid in 2008.

The Company recognized $5.6 million and $2.1 million in interest and fees for services during the year ended December 31, 2008 and 2007, respectively.

Other Joint Ventures

As of December 31, 2008, the Company has a 50% ownership interest in three additional unconsolidated joint ventures.  One of these joint ventures has three operating properties and investments in a property under development and land held for development.  For the development project, the Company has guaranteed cost overruns in excess of the approved project budget. The Company considers payments under the guarantee unlikely. One of these joint ventures has one operating property, an investment in land held for development and a leasehold interest.  The other joint venture has a leasehold interest and does 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, 2008 and 2007 and statements of operations for Liberty Venture I, LP, Kings Hill Unit Trust, Liberty Illinois, LP, Blythe Valley JV Sarl, Liberty Washington, LP, Liberty Commerz 1701 JFK Boulevard, LP and other unconsolidated joint ventures for the years ended December 31, 2008, 2007 and 2006 are as follows (in thousands):

34

Balance Sheets:

	December 31, 2008
	Liberty									Blythe						Liberty Commerz
	Venture I,			Kings Hill			Liberty			Valley JV			Liberty			1701 JFK
	LP			Unit Trust			Illinois, LP			Sarl			Washington, LP			Boulevard, LP			Other			Total
Real estate assets	$	119,523		$	170,521		$	227,318		$	189,256		$	804,587		$	492,189		$	57,933		$	2,061,327
Accumulated depreciation		(16,285	)		(8,971	)		(12,436	)		(5,301	)		(28,515	)		(14,013	)		(790	)		(86,311	)
Real estate assets, net		103,238			161,550			214,882			183,955			776,072			478,176			57,143			1,975,016
Development in progress		9,948			—			16,252			—			101,653			—			7,524			135,377
Land held for development		2,733			—			42,338			42,668			7,859			—			14,435			110,033
Other assets		13,585			10,481			9,506			10,353			58,485			65,495			31,654			199,559
Total assets	$	129,504		$	172,031		$	282,978		$	236,976		$	944,069		$	543,671		$	110,756		$	2,419,985
Debt	$	82,813		$	138,634		$	145,504		$	180,004		$	350,121		$	324,000		$	38,830		$	1,259,906
Other liabilities		2,168			38,112			7,481			37,899			40,919			32,362			19,764			178,705
Equity		44,523			(4,715	)		129,993			19,073			553,029			187,309			52,162			981,374
Total liabilities and equity	$	129,504		$	172,031		$	282,978		$	236,976		$	944,069		$	543,671		$	110,756		$	2,419,985
Company’s net investment in unconsolidated joint ventures (1)	$	10,355		$	3,415		$	26,583		$	9,129		$	138,102		$	50,899		$	28,119		$	266,602

	December 31, 2007
																Liberty
										Blythe			Liberty			Commerz 1701
	Liberty			Kings Hill			Liberty			Valley JV			Washington,			JFK Boulevard,
	Venture I, LP			Unit Trust			Illinois, LP			Sarl			LP			LP		Other			Total
Real estate assets	$	118,030		$	231,399		$	225,405		$	267,488		$	802,146		$	—	$	14,586		$	1,659,054
Accumulated depreciation		(13,115	)		(8,385	)		(6,533	)		(2,004	)		(5,746	)		—		(60	)		(35,843	)
Real estate assets, net		104,915			223,014			218,872			265,484			796,400			—		14,526			1,623,211
Development in progress		—			—			—			—			76,483			—		40,694			117,177
Land held for development		2,733			—			41,008			48,712			7,859			—		28,201			128,513
Other assets		24,185			17,551			11,871			18,716			54,684			—		15,513			142,520
Total assets	$	131,833		$	240,565		$	271,751		$	332,912		$	935,426		$	—	$	98,934		$	2,011,421
Debt	$	81,216		$	188,765		$	145,400		$	251,654		$	339,120		$	—	$	43,249		$	1,049,404
Other liabilities		2,830			50,656			3,677			40,399			43,491			—		3,834			144,887
Equity		47,787			1,144			122,674			40,859			552,815			—		51,851			817,130
Total liabilities and equity	$	131,833		$	240,565		$	271,751		$	332,912		$	935,426		$	—	$	98,934		$	2,011,421
Company’s net investment in unconsolidated joint ventures (1)	$	11,352		$	6,002		$	24,729		$	11,773		$	197,622		$	—	$	26,905		$	278,383

(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 and loans made to the joint ventures by the Company. Deferred gains are amortized to equity in earnings (loss) of joint ventures over the average estimated useful lives of the assets sold.

35

Statements of Operations:

	Year Ended December 31, 2008
																Liberty
	Liberty									Blythe			Liberty			Commerz 1701
	Venture I,			Kings Hill			Liberty			Valley JV			Washington,			JFK Boulevard,
	LP			Unit Trust			Illinois, LP			Sarl			LP			LP			Other			Total
Total revenue	$	19,075		$	18,057		$	22,811		$	15,386		$	76,552		$	43,607		$	3,056		$	198,544
Operating expense		7,074			2,490			7,003			2,377			24,440			15,080			709			59,173
		12,001			15,567			15,808			13,009			52,112			28,527			2,347			139,371
Interest		(4,522	)		(9,900	)		(7,833	)		(14,253	)		(17,670	)		(15,454	)		(2,057	)		(71,689	)
Depreciation and amortization		(4,162	)		(5,272	)		(7,378	)		(5,911	)		(34,951	)		(10,941	)		(862	)		(69,477	)
Other income/(expense)		2,473			(924	)		195			(467	)		722			191			(96	)		2,094
Gain on sale		(3	)		—			—			—			—			—			102			99
Net income (loss)	$	5,787		$	(529	)	$	792		$	(7,622	)	$	213		$	2,323		$	(566	)	$	398
Company’s equity in earnings (loss) of unconsolidated joint ventures	$	1,645		$	167		$	549		$	(1,370	)	$	1,288		$	685		$	(159	)	$	2,805

	Year Ended December 31, 2007
																Liberty
	Liberty									Blythe			Liberty			Commerz 1701
	Venture I,			Kings Hill			Liberty			Valley JV			Washington,			JFK Boulevard,
	LP			Unit Trust			Illinois, LP			Sarl			LP			LP		Other			Total
Total revenue	$	18,457		$	19,696		$	17,360		$	5,920		$	18,203		$	—	$	397		$	80,033
Operating expense		5,807			2,374			4,433			5,265			4,273			—		131			22,283
		12,650			17,322			12,927			655			13,930			—		266			57,750
Interest		(4,240	)		(14,583	)		(6,297	)		(6,009	)		(4,299	)		—		(253	)		(35,681	)
Depreciation and amortization		(4,228	)		(7,058	)		(6,316	)		(2,201	)		(8,969	)		—		(70	)		(28,842	)
Other income/(expense)		(76	)		(645	)		(266	)		(220	)		(1,337	)		—		359			(2,185	)
Gain on sale		524			—			—			—			—			—		867			1,391
Net income (loss)	$	4,630		$	(4,964	)	$	48		$	(7,775	)	$	(675	)	$	—	$	1,169		$	(7,567	)
Company’s equity in earnings (loss) of unconsolidated joint ventures	$	1,320		$	(732	)	$	399		$	(1,514	)	$	(232	)	$	—	$	533		$	(226	)

36

	Year Ended December 31, 2006
														Liberty
	Liberty									Blythe		Liberty		Commerz 1701
	Venture I,			Kings Hill			Liberty			Valley JV		Washington,		JFK Boulevard,
	LP			Unit Trust			Illinois, LP			Sarl		LP		LP		Other			Total
Total revenue	$	18,395		$	18,183		$	7,471		$	—	$	—	$	—	$	—		$	44,049
Operating expense		5,364			2,181			1,833			—		—		—		171			9,549
		13,031			16,002			5,638			—		—		—		(171	)		34,500
Interest		(4,501	)		(13,455	)		(2,527	)		—		—		—		—			(20,483	)
Depreciation and amortization		(4,544	)		(6,267	)		(2,502	)		—		—		—		—			(13,313	)
Other income/(expense)		(127	)		(604	)		5			—		—		—		392			(334	)
Gain on sale		2,644			—			—			—		—		—		138			2,782
Net income (loss)	$	6,503		$	(4,324	)	$	614		$	—	$	—	$	—	$	359		$	3,152
Company’s equity in earnings (loss) of unconsolidated joint ventures	$	1,651		$	(657	)	$	259		$	—	$	—	$	—	$	179		$	1,432

5. DEFERRED FINANCING AND LEASING COSTS

Deferred financing and leasing costs at December 31, 2008 and 2007 are as follows (in thousands):

	December 31,
	2008			2007
Deferred leasing costs	$	188,056		$	173,669
Deferred financing costs		8,754			12,077
In-place lease value and related intangible asset		77,564			77,760
		274,374			263,506
Accumulated amortization		(140,345	)		(119,211	)
Total	$	134,029		$	144,295

6. INDEBTEDNESS

Indebtedness consists of mortgage loans, unsecured notes, and borrowings under the credit facility. The weighted average interest rates for the years ended December 31, 2008, 2007 and 2006, were 6.1%, 6.5% and 6.6%, respectively. Interest costs during the years ended December 31, 2008, 2007 and 2006 in the amount of $20.0 million, $45.7 million and $30.8 million, respectively, were capitalized. Cash paid for interest for the years ended December 31, 2008, 2007 and 2006, was $177.0 million, $172.9 million and $150.2 million, respectively.

During the fourth quarter of the year ended December 31, 2008, the Company purchased $23.4 million of its 8.5% senior unsecured notes. These notes were purchased at a $2.5 million discount. The discount is included in net income as a loan extinguishment gain.

During the year ended December 31, 2007, the Company satisfied a $100 million 7.25% senior unsecured note and issued a $300 million 6.625% senior unsecured note due October 1, 2017. The Company used the net proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes. Amounts repaid under the credit facility were subsequently drawn to pay a portion of the cash merger consideration for the purchase of Republic Property Trust.

37

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.

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, 2008 the Company was in compliance with all financial covenants.

Mortgage Loans, Unsecured Notes

Mortgage loans with maturities ranging from 2009 to 2017 are collateralized by and in some instances cross-collateralized by properties with a net book value of $309.4 million.

The interest rates on $2,327.5 million of mortgage loans and unsecured notes are fixed and range from 5.0% to 8.8%. The weighted average remaining term for the mortgage loans and unsecured notes is 4.9 years.

Credit Facility

$600 Million Unsecured Revolving Credit Facility

The Company has a four-year, $600 million unsecured revolving credit facility (the “$600 million Credit Facility”). 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 $260.0 million of borrowings outstanding as of December 31, 2008 was 1.56%. 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 fee to extend the $600 million Credit Facility for one year is $900,000. 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%.

The scheduled principal amortization and maturities of the Company’s mortgage loans, unsecured notes outstanding and the $600 million Credit Facility 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
2009	$	6,586	$	41,833	$	270,000	$	—	$	318,419		7.76	%
2010		5,823		4,736		176,607		260,000		447,166		4.40	%
2011		5,159		13,409		250,000		—		268,568		7.23	%
2012		4,336		32,875		235,000		—		272,211		6.47	%
2013		3,857		4,510		—		—		8,367		5.79	%
2014		3,888		2,684		200,000		—		206,572		5.66	%
2015		3,336		44,469		300,000		—		347,805		5.25	%
2016		2,409		16,880		300,000		—		319,289		5.55	%
2017		1,770		—		300,000		—		301,770		6.62	%
2018 & thereafter		—		—		100,000		—		100,000		7.50	%
	$	37,164	$	161,396	$	2,131,607	$	260,000	$	2,590,167		6.06	%

38

7. LEASING ACTIVITY

Future minimum rental payments due from tenants under noncancelable operating leases as of December 31, 2008 are as follows (in thousands):

2008	$	491,933
2009		441,833
2010		375,467
2011		312,982
2012		248,657
Thereafter		680,230
TOTAL	$	2,551,102

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. EQUITY

Common Shares

The Company paid to holders of its Common Shares and holders of its common units distributions of $241.8 million, $237.1 million and $229.0 million during the years ended December 31, 2008, 2007, and 2006, respectively. On a per share basis, the Company paid Common Share and Unit distributions of $2.50, $2.485 and $2.465 during the years ended December 31, 2008, 2007, and 2006, respectively.

The following table summarizes the taxability of common share distributions (taxability for 2008 is estimated):

	2008		2007		2006
Ordinary dividend	$	2.0186	$	1.6771	$	1.6421
Qualified dividend		0.3422		0.0904		—
Capital Gain - 15%		0.0664		0.3543		0.6898
IRC Sec 1250 Recapture Gain - 25%		0.0728		0.3632		0.1331
Return of Capital		—		—		—
Total	$	2.5000	$	2.4850	$	2.4650

The Company’s tax return for the year ended December 31, 2008 has not been filed. The taxability information presented for the 2008 distributions is based upon the best available data. The Company’s prior 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.

Common Shares Held in Treasury

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).

During the year ended December 31, 2007, the Company purchased 1,190,809 Common Shares for $50.6 million as part of the share repurchase plan. The Company purchased no Common Shares under the share repurchase plan during 2008.

Noncontrolling Interest

Noncontrolling interest in the accompanying financial statements represents the interests of the common and preferred units in Liberty Property Limited Partnership not held by the Trust. In addition, noncontrolling interests include third-party ownership interests in consolidated joint venture investments. Pursuant to the Company’s retrospective adoption on January 1, 2009 of SFAS No. 160, which establishes and expands the accounting and reporting standards of minority interests to be recharacterized as noncontrolling interests in a subsidiary and the deconsolidation of a subsidiary, the Company is presenting its noncontrolling interests as permanent equity for all periods.

39

Common Units

The common units outstanding as of December 31, 2008 have the same economic characteristics as common shares of the Trust. The common units share proportionately in the net income or loss and in any distributions of the Operating Partnership. The common units of the Operating Partnership not held by the Trust are redeemable at any time at the option of the holder. The Trust as the sole general partner of the Operating Partnership may at its option elect to settle the redemption in cash or through the exchange on a one–for-one basis with unregistered common shares of the Trust. The market value of the 4,074,967 common units of the Operating Partnership not held by the Trust based on the closing price of the shares of the Company at December 31, 2008 was $93.0 million.

During 2006, 684,432 common units were issued in connection with an acquisition. No common units were issued in connection with acquisitions during 2008 or 2007.

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	8/31/13 into Series B 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	12/12/15 into Series F Cumulative Redeemable Preferred Shares of the Trust
8/23/05	Series F	$	6,000		120	$	50		6.65	%		6/30/10	12/12/15 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
8/21/07	Series H	$	100,000		4,000	$	25		7.40	%		8/21/12	8/21/17 into Series H Cumulative Redeemable Preferred Shares of the Trust

The Preferred Units are callable at the Operating Partnership’s option after a stated period of time. The Trust is the sole general partner of the Operating Partnership may at its option elect to settle the redemption for cash or through the exchange on a one-on-one basis with unregistered preferred shares of the Trust.

During the year ended December 31, 2007, the Company raised $100 million through the placement of 7.40% Series H Cumulative Redeemable Preferred Units.

During the year ended December 31, 2007, the Company redeemed for $23.7 million its outstanding 7.625% Series D Cumulative Redeemable Preferred Units. The redemption resulted in a $0.7 million write off of Series D issuance costs, which was recorded in noncontrolling interest expense in the accompanying consolidated financial statements.

The Company paid the following Preferred Unit distributions for the year ended December 31:

	2008		2007		2006
Distributions (in millions)	$	21.0	$	17.1	$	13.7
Distribution per unit:
Series B	$	1.86	$	1.86	$	1.86
Series D	$	1.74	$	1.74	$	3.81
Series E	$	3.50	$	3.50	$	3.50
Series F	$	3.33	$	3.33	$	3.33
Series G	$	3.35	$	3.35	$	0.16
Series H	$	1.85	$	0.67		—

As of December 31, 2008, the Company has 6,273,000 authorized but unissued preferred shares.

40

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 was attached to each share of common stock issued after that date. Each Right entitled 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 became exercisable only if a person or group of affiliated or associated persons (an “Acquiring Person”) acquired, or obtained the right to acquire, beneficial ownership of Common Shares or other voting securities (“Voting Stock”) that had 10% or more of the voting power of the outstanding shares of Voting Stock, or if an Acquiring Person commenced to make a tender offer or exchange offer to acquire beneficial ownership of Voting Stock that had 10% or more of the voting power of the outstanding shares of Voting Stock. The Rights were redeemable by the Company at a price of $0.0001 per Right. All Rights expired on December 31, 2007.

While the Company did not extend or renew the plan, it is not prohibited from adopting, without shareholder approval, a shareholder rights plan that may discourage any potential acquirer from acquiring more than a specified percentage of our outstanding Common Shares since, upon this type of acquisition without approval of our board of trustees, all other common shareholders would have the right to purchase a specified amount of Common Shares at a substantial discount from market price.

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, 2008, 2007, and 2006, 1,328,376, 1,366,066, and 1,297,867 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 $1.4 million, $912,000 and $940,000 for the years ended 2008, 2007 and 2006, respectively.

10. SHARE BASED COMPENSATION

2008 Plan

In March 2008, the Compensation Committee of the Board of Trustees (the “Board”) adopted a 2008 Long-Term Incentive Plan (the “2008 Plan”) which is applicable to the Company’s executive officers.  Pursuant to the 2008 Plan grants of stock options and restricted stock units were made. 

Options

The Company has authorized the grant of options under the share-based employee compensation plan (the “Plan”) and the 2008 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 and are expensed over a three-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, 2008, 2007 and 2006 was $1.0 million, $904,000 and $790,000, respectively.

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:

41

	Year Ended December 31,
	2008			2007			2006
Risk-free interest rate		2.7	%		4.6	%		4.8	%
Dividend yield		7.0	%		5.1	%		5.8	%
Volatility factor		0.221			0.183			0.188
Weighted-average expected life	5 years			5 years			7 years

A summary of the Company’s share option activity, and related information for the year ended December 31, 2008 follows:

				Weighted
				Average
	Options			Exercise
	(000s)			Price
Outstanding at January 1, 2008		2,416		$	33.67
Granted		794			32.04
Exercised		(261	)		24.76
Forfeited		(57	)		30.45
Outstanding at December 31, 2008		2,892		$	34.09
Exercisable at December 31, 2008		1,875		$	33.21

The weighted average fair value of options granted during the years ended December 31, 2008, 2007 and 2006 was $2.64, $5.60 and $5.06, respectively. Exercise prices for options outstanding as of December 31, 2008 ranged from $21.88 to $49.74. The weighted average remaining contractual life of the options outstanding and exercisable at December 31, 2008 was 5.6 years and 3.8 years, respectively.

During the years ended December 31, 2008, 2007 and 2006, 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 $2.6 million, $7.7 million and $23.5 million, respectively. As of December 31, 2008, certain of the options outstanding and exercisable had an exercise price higher than the closing price of the Company’s Common Shares and are considered to have no intrinsic value. As of December 31, 2008, 208,000 options outstanding and exercisable had an exercise price lower than the closing price of the Company’s Common Shares. The aggregate intrinsic value of these options was $43,000. The total cash received from the exercise of options for the years ended December 31, 2008, 2007 and 2006 was $6.5 million, $8.7 million and $29.4 million, respectively. The Company has historically issued new shares to satisfy share option exercises.

As of December 31, 2008, there was $2.2 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 2.0 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 five-year period beginning with the first anniversary of the grant.

Restricted stock unit grants made pursuant to the 2008 Plan consist of an obligation to pay the executive officers Common Shares at the end of the third year after the date of grant. The number of restricted stock units issued will be determined by using specific performance measures.

Share-based compensation cost related to restricted LTI share grants for the years ended December 31, 2008, 2007 and 2006 were $4.4 million, $3.8 million and $3.0 million, respectively.

The following table shows a summary of the Company’s restricted LTI share activity for the year ended December 31, 2008:

					Weighted Avg
		Shares			Grant Date
		(000s)			Fair value
Nonvested at January 1, 2008			288		$	44.72
Granted			163			31.04
Vested			(83	)		42.30
Forfeited			(10	)		40.72
	��
Nonvested at December 31, 2008			358		$	39.13

42

The weighted average fair value of restricted shares granted during the years ended December 31, 2008, 2007 and 2006 was $31.04 per share, $49.53 per share and $48.08 per share. As of December 31, 2008, there was $14.0 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 1.9 years. The total fair value of restricted shares vested during the years ended December 31, 2008, 2007 and 2006 was $3.5 million, $2.4 million and $1.9 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, 2008, 2007 and 2006 were 83,015, 64,755 and 39,207, respectively. Share-based compensation cost related to Bonus Shares for the years ended December 31, 2008, 2007 and 2006 was $2.6 million, $2.9 million and $1.9 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, 2008, 2007 and 2006 were 15,517, 3,457 and 3,072 shares, respectively.

An additional 1,751,912, 2,738,176 and 3,063,169 Common Shares were reserved for issuance for future grants under the Share Incentive Plan at December 31, 2008, 2007, and 2006, 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 17,618, 13,414 and 10,491 shares issued, in accordance with the ESPP, during the years ended December 31, 2008, 2007 and 2006, respectively.

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.

The Company is obligated to make additional capital contributions to unconsolidated joint ventures of $3.8 million. The Company has not guaranteed any of the debt of the unconsolidated joint ventures.

The Company has letter of credit obligations of $2.0 million related to development requirements. It is remote that there will be a draw upon these letter of credit obligations.

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.

Litigation

The Company has been substituted for Republic as a party to certain litigation as a result of the Company’s acquisition of Republic on October 4, 2007. The litigation arises out of disputes between Republic and certain parties, two of whom were members of Republic’s Board of Trustees and “founders” of Republic. The disputes include claims arising from the termination of an officer of Republic (damages sought $1.8 million) and an attempt by Republic to acquire a certain office property from an entity controlled by the aforementioned related parties pursuant to an option agreement entered into at the time of Republic’s formation (damages sought $85.0 million compensatory and $85.0 million punitive). The Company believes that these claims are without merit and intends to defend itself vigorously against this litigation.

43

In accordance with SFAS No. 5 “Accounting for Contingencies,”the Company will record a provision for a liability when it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. Although the outcome of any litigation is uncertain, the Company believes that such legal actions will not have a material adverse affect on our consolidated financial condition, results of operations or cash flows.

12. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

A summary of quarterly results of operations for the years ended December 31, 2008 and 2007 follows. Certain amounts have been reclassified to conform to the current presentation of discontinued operations as of March 31, 2009 and the retrospective adoption of SFAS No. 160 (in thousands, except per share amounts).

	Quarter Ended
	Dec. 31,		Sept. 30,		June 30,		Mar. 31,		Dec. 31,		Sept. 30,		June 30,		Mar. 31,
	2008		2008		2008		2008		2007		2007		2007		2007
Operating revenue	$	188,527	$	185,958	$	182,053	$	189,470	$	184,621	$	173,293	$	165,319	$	161,652
Income from continuing operations		48,839		34,844		34,767		34,891		31,074		36,865		39,299		39,545
Discontinued operations		10,540		11,109		3,611		1,505		11,395		6,248		20,025		5,859
Net Income		59,379		45,953		38,378		36,396		42,469		43,113		59,324		45,404
Income per common share — basic (1)		0.53		0.41		0.34		0.33		0.39		0.41		0.57		0.44
Income per common share — diluted (1)		0.53		0.41		0.34		0.33		0.39		0.41		0.57		0.43

(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, Midwestern and Southwestern 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
Northeast	Southeastern PA; Lehigh/Central PA; New Jersey
Midwest	Minnesota; Milwaukee; Chicago
Mid-Atlantic	Maryland; Carolinas; Richmond; Virginia Beach
South	Jacksonville; Orlando; Boca Raton; Tampa; Texas; Arizona
Philadelphia	Philadelphia; Northern Virginia/Washington, D.C.
United Kingdom	County of Kent; West Midlands

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.

During the year ended December 31, 2008, the Company began to report the results of the Arizona market as part of the “South” reportable segment rather than listing Arizona as its own reportable segment, as it had been presented in 2007. Also, the Company began to report the results of the Lehigh/Central PA market as part of the “Northeast” reportable segment rather than as part of the “Midwest” segment. The Company also began to report the results of certain operating properties containing 834,000 square feet in the “Philadelphia” reportable segment rather than as part of the New Jersey market in the “Northeast” reportable segment, as they had been presented in 2007. As required by SFAS No. 131 (“SFAS No. 131”) “Disclosures about Segments of an Enterprise and Related Information,” consolidated financial statements issued by the Company in the future will reflect modifications to the

44

Company’s reportable segments resulting from the change described above, including reclassification of all comparative prior period segment information.

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, with restated amounts that reflect discontinued operations as of March 31, 2009 (in thousands):

YEAR ENDED DECEMBER 31, 2008

	Northeast
			Lehigh/
	Southeastern		Central		New								phila-		united
	PA		PA		Jersey		Midwest		mid-atlantic		South		delphia		kingdom		total
Operating revenue		$178,507		$96,906		$38,004		$82,964		$142,543		$173,319		$29,426		$4,339		$746,008
Rental property expenses and real estate taxes		57,729		26,114		14,848		31,074		41,652		57,990		7,791		1,044		238,242
Property level operating income		$120,778		$70,792		$23,156		$51,890		$100,891		$115,329		$21,635		$3,295		507,766
Interest and other income																		13,501
Debt extinguishment gain																		2,521
Interest expense																		(155,198	)
General and administrative																		(54,387	)
Depreciation and amortization																		(172,594	)
Income before property dispositions, income taxes and equity in earnings of unconsolidated joint ventures																		141,609
Gain on property dispositions																		10,572
Income taxes																		(1,645	)
Equity in earnings of unconsolidated joint ventures																		2,805
Discontinued operations																		26,765
Net income																		$180,106
YEAR ENDED DECEMBER 31, 2007
	Northeast
			Lehigh/
	Southeastern		Central		New								phila-		united
	PA		PA		Jersey		Midwest		mid-atlantic		South		delphia		kingdom		total
Operating revenue		$172,142		$89,685		$36,162		$80,926		$128,599		$150,693		$23,963		$2,715		$684,885
Rental property expenses and real estate taxes		56,950		22,886		9,228		28,061		38,524		50,419		9,378		33		215,479
Property level operating income		$115,192		$66,799		$26,934		$52,865		$90,075		$100,274		$14,585		$2,682		469,406
Interest and other income																		11,720
Interest expense																		(126,707	)
General and administrative																		(54,334	)
Depreciation and amortization																		(155,248	)
Income before property dispositions, income taxes and equity in loss of unconsolidated joint ventures																		144,837
Gain on property dispositions																		1,463
Income taxes																		709
Equity in loss of unconsolidated joint ventures																		(226	)
Discontinued operations																		43,527
Net income																		$190,310

45

YEAR ENDED DECEMBER 31, 2006

	Northeast
	Southeastern		Lehigh/		New								phila-		united
	PA		Central PA		Jersey		Midwest		mid-atlantic		South		delphia		kingdom		total
Operating revenue		$168,227		$82,107		$34,584		$75,966		$114,593		$113,347		$15,829		$1,167		$605,820
Rental property expenses and real estate taxes		54,181		19,885		8,128		26,752		33,925		36,822		6,913		261		186,867
Property level operating income		$114,046		$62,222		$26,456		$49,214		$80,668		$76,525		$8,916		$906		418,953
Interest and other income																		8,690
Interest expense																		(109,265	)
General and administrative																		(46,358	)
Depreciation and amortization																		(131,822	)
Income before property dispositions, income taxes and equity in earnings of unconsolidated joint ventures																		140,198
Gain on property dispositions																		17,628
Income taxes																		(288	)
Equity in earnings of unconsolidated joint ventures																		1,432
Discontinued operations																		133,073
Net income																	$	292,043

	Real Estate Related Revenues
	Year Ended December 31,
Product Type Information	2008		2007		2006
Industrial	$	299,581	$	274,404	$	253,222
Office		446,427		410,481		352,598
Total operating revenue	$	746,008	$	684,885	$	605,820

ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT

	Northeast
				Lehigh/
	Southeastern			Central		New												Phila-			United
	PA			PA		Jersey			Midwest			Mid-Atlantic			South			Delphia			Kingdom (1)			Total
January 1, 2008	$	1,103,372		$	676,963	$	199,662		$	543,445		$	965,546		$	1,190,232		$	470,548		$	51,532		$	5,201,300
Additions		40,599			76,621		22,763			7,319			50,811			109,111			7,729			(13,119	)		301,834
Dispositions		(23,232	)		—		(10,921	)		(8,928	)		(15,338	)		(3,300	)		(367,897	)		—			(429,616	)
December 31, 2008	$	1,120,739		$	753,584	$	211,504		$	541,836		$	1,001,019		$	1,296,043		$	110,380		$	38,413			5,073,518
Accumulated depreciation																									(982,114	)
Development in progress																									245,463
Land held for development																									209,551
Assets held for sale																									33,662
Other assets																									636,955
Total assets at December 31, 2008																								$	5,217,035

46

ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT

	Northeast
				Lehigh/
	Southeastern			Central														Phila-		United
	PA			PA			New Jersey		Midwest			Mid-Atlantic			South			Delphia		Kingdom (1)		Total
January 1, 2007	$	1,048,142		$	582,475		$	112,397	$	699,585		$	861,863		$	953,808		$	103,008	$	11,435	$	4,372,713
Additions		67,645			103,750			87,265		64,050			114,274			245,317			367,540		40,097		1,089,938
Dispositions		(12,415	)		(9,262	)		—		(220,190	)		(10,591	)		(8,893	)		—		—		(261,351	)
December 31, 2007	$	1,103,372		$	676,963		$	199,662	$	543,445		$	965,546		$	1,190,232		$	470,548	$	51,532		5,201,300
Accumulated depreciation																							(858,671	)
Development in progress																							316,985
Land held for development																							247,124
Assets held for sale																							36,908
Other assets																							700,291
Total assets at December 31, 2007																						$	5,643,937

(1) United Kingdom additions are impacted by foreign currency translation gain or loss.

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 as of March 31, 2009 are reflected in the consolidated statements of operations as discontinued operations. Prior year financial statements have been adjusted for discontinued operations as of March 31, 2009. The proceeds from dispositions of operating properties with no continuing involvement were $80.0 million and $369.5 million for the years ended December 31, 2008 and 2007, respectively.

Below is a summary of the results of operations of the properties disposed of through the respective disposition dates (in thousands):

	Year Ended December 31,
	2008			2007			2006
Revenues	$	15,814		$	45,283		$	87,281
Operating expenses		(6,232	)		(18,020	)		(31,725	)
Interest expense		(2,680	)		(7,308	)		(14,981	)
Depreciation and amortization		(3,656	)		(10,039	)		(20,122	)
Income before property dispositions	$	3,246		$	9,916		$	20,453

Included in the discontinued operations above are six properties totaling 296,000 square feet located in the Company’s Mid-Atlantic segment that were considered to be held for sale as of December 31, 2008 and five properties totaling 152,000 square feet located in the Company’s Northeast segment that were considered to be held for sale as of March 31, 2009.

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) to the sum of total net assets plus consolidated debt.

47

Asset Impairment

In accordance with SFAS No. 144, during the years ended December 31, 2008, 2007 and 2006, the Company recognized impairment losses of $3.1 million, $0.2 million and $4.2 million, respectively. The 2008 impairment loss of $3.1 million was recognized in the fourth quarter and was related to a 49,000 square foot operating property in the Midwest segment, a 110,000 square foot operating property in Southeastern PA and a 296,000 square foot portfolio of operating properties in the Mid-Atlantic segment. The 2007 impairment loss of $0.2 million was related to various land parcels. The 2006 impairment loss of $4.2 million was primarily related to a 352,000 square foot portfolio of operating properties in the Midwest segment. For the years ended December 31, 2008 and 2006, respectively, $3.1 million and $4.2 million in impairment related to properties sold or held for sale were included in the caption discontinued operations in the Company’s statement of operations. For the year ended December 31, 2007, $0.2 million in impairment was 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, 2008.

15. SUBSEQUENT EVENTS

In December 2008, the Company commenced the sale of Common Shares pursuant to a continuous offering program. From January 1, 2009 through May 19, 2009, the Company sold 6.0 million common shares through this program. The net proceeds from the offering of $121.7 million were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

During the period from January 1, 2009 through May 19, 2009, the Company closed on mortgages totaling $317.4 million bearing interest at an average rate of 7.1%. The mortgages encumber certain of the Company’s Properties in Operation. The net proceeds from these mortgages were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

During the period from January 1, 2009 through May 19, 2009, the Company repaid $20 million of 8.125% medium term unsecured notes, purchased $11.4 million of its 7.75% senior notes and $6.9 million of its 8.50% senior notes and repaid $238.6 million of its 7.75% senior unsecured notes.

In April 2009, the Company’s Board of Trustees approved the expansion of the Company’s continuous offering program. In addition to the original program, the expansion allows for the sale of an additional $150 million in common shares.

16. ADJUSTMENTS TO PREVIOUSLY FILED FINANCIAL STATEMENTS

These consolidated financial statements have been updated to reflect the adoption of SFAS No. 160 and discontinued operations as of March 31, 2009.

SFAS No.160

Effective January 1, 2009, the Company adopted SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements — an amendment of ARB No. 51 (“SFAS No. 160”). SFAS No. 160 describes a noncontrolling interest, sometimes called a minority interest, as the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent. SFAS No. 160 establishes accounting and reporting standards that require, among other items: a) the ownership interests in subsidiaries held by parties other than the parent be presented in the consolidated balance sheets within equity but separate from the parent’s equity; b) the amount of consolidated net income in the consolidated statements of operations attributable to the parent and the noncontrolling interests be presented on the face of the consolidated statements of operations; and c) entities provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling holders. The presentation and disclosure requirements of SFAS No. 160 have been applied retrospectively for all periods presented in the accompanying consolidated balance sheets, statements of operations, statements of equity, and statements of cash flows. In addition, Note 8 includes expanded disclosures regarding the rights of the various equity holders and Notes 12 (unaudited) and 13 have been updated pursuant to the presentation requirements of SFAS No. 160.

The following reflects the adjustments made to the consolidated balance sheets from those previously filed.

48

As of December 31, 2008

	As reported			Adjustment			As adjusted
Minority Interest	$	369,771		$	(369,771	)	$	—
Equity
Common Shares		101			—			101
Additional paid - in capital		2,199,684			(36,864	)		2,162,820
Accumulated other comprehensive (loss) income		(5,378	)		—			(5,378	)
Distributions in excess of net income		(185,721	)		—			(185,721	)
Common shares in treasury		(51,951	)		—			(51,951	)
Total Liberty Property Trust Shareholders equity	$	1,956,735			(36,864	)		1,919,871
Noncontrolling interest — operating partnership					405,505			405,505
Noncontrolling interest — consolidated joint ventures					1,130			1,130
Total equity				$	369,771		$	2,326,506

49

As of December 31, 2007

	As reported			Adjustment			As adjusted
Minority Interest	$	372,621		$	(372,621	)		—
Equity
Common Shares		93			—			93
Additional paid - in capital		1,984,141			(36,688	)		1,947,453
Accumulated other comprehensive (loss) income		21,378			—			21,378
Distributions in excess of net income		(116,640	)		—			(116,640	)
Common shares in treasury		(51,951	)		—			(51,951	)
Total Liberty Property Trust Shareholders equity	$	1,837,021			(36,688	)		1,800,333
Noncontrolling interest — operating partnership					408,792			408,792
Noncontrolling interest — consolidated joint ventures					517			517
Total equity				$	372,621		$	2,209,642

50

Discontinued Operations

The accompanying financial statements have also been updated to reflect for all periods presented the results of operations of five properties totaling 152,000 square feet in the Company’s Northeast segment that were considered to be held for sale as of March 31, 2009.

These adjustments impacted the consolidated statements of operations, the income per common share disclosures in Note 2, the quarterly results of operations in Note 12 (unaudited), the segment disclosures in Note 13, and the discontinued operations disclosures in Note 14.
The impact of these changes was to decrease income from continuing operations and increase income from discontinued operations by $684, $589, and $721 for the years ended December 31, 2008, 2007, and 2006, respectively, compared to the previously filed financial statements.

51

LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2008

								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
1501 Perryman Road	Aberdeen, MD		—		5,813,324		18,874,059		5,148,782		5,816,839		24,019,325		29,836,164		1,386,798	2005	40 yrs.
2196 Avenue C	Allentown, PA		—		101,159		—		1,347,970		107,307		1,341,822		1,449,129		828,845	1980	40 yrs.
7437 Industrial Boulevard	Allentown, PA		—		717,488		5,022,413		3,000,614		726,651		8,013,864		8,740,515		3,041,759	1976	40 yrs.
7248 Industrial Boulevard	Allentown, PA		—		2,670,849		13,307,408		4,005,636		2,670,673		17,313,219		19,983,893		4,549,501	1988	40 yrs.
700 Nestle Way	Allentown, PA		—		3,473,120		—		20,041,174		4,174,970		19,339,324		23,514,294		5,383,054	1998	40 yrs.
7562 Penn Drive	Allentown, PA		—		269,614		844,069		213,047		269,614		1,057,116		1,326,730		322,567	1989	40 yrs.
7277 Williams Avenue	Allentown, PA		—		462,964		1,449,009		436,346		463,123		1,885,196		2,348,319		676,185	1989	40 yrs.
7355 Williams Avenue	Allentown, PA		—		489,749		1,658,091		314,252		489,749		1,972,343		2,462,092		584,331	1998	40 yrs.
794 Roble Road	Allentown, PA		—		1,147,541		6,088,041		1,183,790		1,147,541		7,271,832		8,419,373		2,282,296	1985	40 yrs.
8014 Industrial Boulevard	Allentown, PA		—		4,019,258		—		9,764,392		3,645,117		10,138,533		13,783,650		3,039,925	1999	40 yrs.
705 Boulder Drive	Allentown, PA		—		4,484,096		—		14,878,034		4,486,836		14,875,294		19,362,130		3,148,524	2001	40 yrs.
651 Boulder Drive	Allentown, PA		—		4,308,646		—		13,339,042		4,308,646		13,339,042		17,647,688		3,160,648	2000	40 yrs.
8150 Industrial Boulevard	Allentown, PA		—		2,564,167				8,906,935		2,571,466		8,899,637		11,471,103		1,920,198	2002	40 yrs.
8250 Industrial Boulevard	Allentown, PA		—		1,025,667				5,346,179		1,035,854		5,335,991		6,371,846		950,726	2002	40 yrs.
650 Boulder Drive	Allentown, PA		—		5,208,248				31,405,185		9,961,788		26,651,645		36,613,433		4,081,623	2002	40 yrs.
200 Boulder Drive	Allentown, PA		—		4,722,683		18,922,645		237,680		4,722,683		19,160,325		23,883,008		2,091,911	2004	40 yrs.
250 Boulder Drive	Allentown, PA		—		3,599,936		12,099,145		2,089,337		3,719,772		14,068,646		17,788,418		1,611,741	2004	40 yrs.
8400 Industrial Boulevard	Allentown, PA		—		6,725,948		—		27,118,534		7,534,937		26,309,546		33,844,483		1,409,375	2005	40 yrs.
400 Nestle Way	Allentown, PA		20,940,815		8,065,500		—		27,420,765		8,184,096		27,302,169		35,486,265		8,931,479	1997	40 yrs.
2202 Hanger Place	Allentown, PA		*		137,439		—		1,341,155		138,127		1,340,466		1,478,594		888,748	1981	40 yrs.
7339 Industrial Boulevard	Allentown, PA		*		1,187,776		—		6,971,256		1,197,447		6,961,585		8,159,032		2,491,805	1996	40 yrs.
6923 Schantz Spring Road	Allentown, PA		*		1,127,805		3,309,132		349,184		1,127,805		3,658,316		4,786,120		1,068,345	1993	40 yrs.
7165 Ambassador Drive	Allentown, PA		*		792,999		—		4,533,868		804,848		4,522,019		5,326,867		873,259	2002	40 yrs.
6560 Stonegate Drive	Allentown, PA		—		458,281		—		2,833,097		458,945		2,832,433		3,291,378		1,350,717	1989	40 yrs.
6370 Hedgewood Drive	Allentown, PA		—		540,795		—		3,744,192		541,459		3,743,528		4,284,987		1,694,468	1990	40 yrs.
6390 Hedgewood Drive	Allentown, PA		—		707,203		—		2,765,090		707,867		2,764,425		3,472,293		1,444,458	1990	40 yrs.
6330 Hedgewood Drive	Allentown, PA		—		531,268		—		4,920,859		532,047		4,920,080		5,452,127		2,638,382	1988	40 yrs.
6580 Snowdrift Road	Allentown, PA		—		388,328		—		3,355,897		389,081		3,355,145		3,744,225		1,711,345	1988	40 yrs.
6540 Stonegate Drive	Allentown, PA		—		422,042		—		3,893,307		422,730		3,892,620		4,315,349		2,033,216	1988	40 yrs.
974 Marcon Boulevard	Allentown, PA		—		143,500		—		2,536,742		144,248		2,535,995		2,680,242		1,432,744	1987	40 yrs.
964 Marcon Boulevard	Allentown, PA		—		138,816		—		2,114,065		139,480		2,113,401		2,252,881		1,211,949	1985	40 yrs.
764 Roble Road	Allentown, PA		—		141,069		—		876,165		141,746		875,488		1,017,234		491,466	1985	40 yrs.
3174 Airport Road	Allentown, PA		—		98,986		—		1,192,596		98,986		1,192,595		1,291,582		778,937	1979	40 yrs.
2201 Hanger Place	Allentown, PA		—		128,454		—		1,918,272		129,142		1,917,583		2,046,726		1,272,750	1987	40 yrs.
954 Marcon Boulevard	Allentown, PA		—		103,665		—		1,347,546		104,453		1,346,758		1,451,211		648,206	1981	40 yrs.
754 Roble Road	Allentown, PA		—		162,115		1,731,885		502,487		163,735		2,232,752		2,396,487		878,285	1986	40 yrs.
744 Roble Road	Allentown, PA		—		159,771		1,734,229		271,718		161,371		2,004,347		2,165,718		770,782	1986	40 yrs.
944 Marcon Boulevard	Allentown, PA		—		118,521		1,435,479		610,844		119,711		2,045,133		2,164,844		767,454	1986	40 yrs.
6520 Stonegate Drive	Allentown, PA		—		453,315		—		1,791,480		484,361		1,760,434		2,244,795		727,358	1996	40 yrs.
2041 Avenue C	Allentown, PA		—		213,599		1,095,217		83,135		213,879		1,178,072		1,391,951		412,984	1990	40 yrs.
7144 Daniels Drive	Allentown, PA		—		2,390,217		2,342,761		3,725,676		1,579,169		6,879,485		8,458,654		2,191,962	1975	40 yrs.
7620 Cetronia Road	Allentown, PA		—		1,091,806		3,851,456		366,017		1,093,724		4,215,555		5,309,279		1,567,236	1990	40 yrs.
6350 Hedgewood Drive	Allentown, PA		*		360,027		—		3,886,266		560,691		3,685,601		4,246,293		1,564,087	1989	40 yrs.
180,190 Cochrane Drive	Annapolis, MD		—		3,670,256		—		23,101,092		3,752,293		23,019,055		26,771,348		10,515,407	1988	40 yrs.
4606 Richlynn Drive	Belcamp, MD		—		299,600		1,818,861		712,787		299,600		2,531,649		2,831,249		597,538	1985	40 yrs.
1655 Valley Center Parkway	Bethlehem, PA		—		214,431		—		2,077,289		215,095		2,076,625		2,291,720		1,040,257	1993	40 yrs.
1455 Valley Center Parkway	Bethlehem, PA		—		670,290		—		3,920,812		545,172		4,045,930		4,591,102		1,904,321	1997	40 yrs.
1640 Valley Center Parkway	Bethlehem, PA		—		359,000		—		4,265,161		190,728		4,433,433		4,624,161		1,496,403	1996	40 yrs.
1650 Valley Center Parkway	Bethlehem, PA		—		359,000		—		2,221,482		188,896		2,391,586		2,580,482		1,039,490	1997	40 yrs.
1660 Valley Center Parkway	Bethlehem, PA		—		359,000		—		2,296,178		188,721		2,466,457		2,655,178		880,964	1998	40 yrs.
83 South Commerce Way	Bethlehem, PA		—		143,661		888,128		533,628		212,744		1,352,673		1,565,417		587,093	1989	40 yrs.
85 South Commerce Way	Bethlehem, PA		—		236,708		987,949		208,501		237,078		1,196,080		1,433,158		374,817	1989	40 yrs.
87 South Commerce Way	Bethlehem, PA		—		253,886		1,062,881		275,641		253,886		1,338,522		1,592,408		459,576	1989	40 yrs.
89 South Commerce Way	Bethlehem, PA		—		320,000		—		2,020,662		367,706		1,972,956		2,340,662		828,516	1998	40 yrs.
1525 Valley Center Parkway	Bethlehem, PA		—		475,686		—		7,754,839		804,104		7,426,421		8,230,525		2,341,241	1999	40 yrs.
74 West Broad Street	Bethlehem, PA		—		1,096,127				13,513,997		1,099,079		13,511,045		14,610,124		3,613,884	2002	40 yrs.
1605 Valley Center Parkway	Bethlehem, PA		—		729,751				11,118,924		1,766,196		10,082,479		11,848,675		2,546,868	2000	40 yrs.
3400 High Point Boulevard	Bethlehem, PA		—		298,227		—		3,053,506		662,809		2,688,924		3,351,733		531,758	2002	40 yrs.
3500 High Point Boulevard	Bethlehem, PA		—		289,529		—		4,451,571		916,280		3,824,820		4,741,100		280,248	2006	40 yrs.
3450 High Point Boulevard	Bethlehem, PA		—		303,197		—		4,244,190		918,473		3,628,915		4,547,388		87,174	2006	40 yrs.
1495 Valley Center Parkway	Bethlehem, PA		—		434,640		—		4,962,712		435,303		4,962,049		5,397,352		2,114,820	1990	40 yrs.
1550 Valley Center Parkway	Bethlehem, PA		—		196,954		—		4,189,791		197,700		4,189,045		4,386,745		1,757,816	1988	40 yrs.
1560 Valley Center Parkway	Bethlehem, PA		—		240,069		—		4,635,199		240,732		4,634,536		4,875,268		2,379,153	1988	40 yrs.
1510 Valley Center Parkway	Bethlehem, PA		—		312,209		—		3,808,228		312,873		3,807,563		4,120,437		1,953,445	1988	40 yrs.
1530 Valley Center Parkway	Bethlehem, PA		—		211,747		—		3,016,731		212,492		3,015,986		3,228,478		1,476,546	1988	40 yrs.
57 South Commerce Way	Bethlehem, PA		—		390,839		2,701,161		789,433		395,459		3,485,974		3,881,433		1,473,420	1986	40 yrs.
1685 Valley Center Parkway	Bethlehem, PA		—		244,029		—		2,429,110		198,482		2,474,657		2,673,139		1,003,460	1996	40 yrs.
6601-6625 W. 78th Street	Bloomington, MN		—		2,263,060		—		38,819,236		2,310,246		38,772,050		41,082,296		9,886,677	1998	40 yrs.
6161 Green Valley Drive	Bloomington, MN		—		740,378		3,311,602		701,685		709,961		4,043,704		4,753,665		951,437	1992	40 yrs.
10801 Nesbitt Avenue South	Bloomington, MN		—		784,577				4,105,182		786,382		4,103,377		4,889,759		1,238,848	2001	40 yrs.
5775 West Old Shakopee Road	Bloomington, MN		—		2,052,018		3,849,649		3,313,825		2,060,644		7,154,848		9,215,492		3,055,337	2002	40 yrs.
5715 Old Shakopee Road West	Bloomington, MN		—		1,263,226		2,360,782		2,476,073		1,264,758		4,835,323		6,100,081		1,255,310	2002	40 yrs.

52

								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
5735 Old Shakopee Road West	Bloomington, MN		—		1,263,226		2,360,782		1,086,930		1,264,758		3,446,180		4,710,938		667,284	2002	40 yrs.
5705 Old Shakopee Road	Bloomington, MN		—		2,113,223		—		5,521,336		2,148,571		5,485,989		7,634,559		275,121	2001	40 yrs.
1701 Clint Moore Boulevard	Boca Raton, FL		—		1,430,884		3,043,553		1,316,677		1,430,937		4,360,178		5,791,114		1,145,888	1985	40 yrs.
951 Broken Sound Parkway	Boca Raton, FL		—		1,426,251		6,098,952		1,881,060		1,426,251		7,980,012		9,406,262		2,597,600	1986	40 yrs.
777 Yamato Road	Boca Raton, FL		—		4,101,247		16,077,347		5,811,125		4,501,247		21,488,473		25,989,719		6,441,664	1987	40 yrs.
1801 Clint Moore Road	Boca Raton, FL		—		1,065,068		4,481,644		686,050		1,065,068		5,167,695		6,232,763		1,615,765	1986	40 yrs.
860 Nestle Way	Breinigsville, PA		—		8,118,881		18,885,486		2,377,934		8,118,881		21,263,420		29,382,301		1,882,266	2004	40 yrs.
8201 Industrial Boulevard	Breinigsville, PA		—		2,089,719		—		8,333,883		2,226,432		8,197,170		10,423,602		412,396	2006	40 yrs.
400 Boulder Drive	Breinigsville, PA		*		—				13,408,721		2,865,575		10,543,146		13,408,721		1,157,345	2003	40 yrs.
602 Heron Drive	Bridgeport, NJ		—		524,728		2,240,478		7,650		524,728		2,248,128		2,772,856		603,754	1996	40 yrs.
245 Executive Drive	Brookfield, WI		—		577,067		5,197,903		4,071,582		577,067		9,269,485		9,846,552		2,463,373	1984	40 yrs.
15800 West Bluemound Road	Brookfield, WI		—		1,289,204		8,128,035		1,552,539		1,306,811		9,662,967		10,969,778		2,052,573	1994	40 yrs.
20800 Swenson Drive	Brookfield, WI		4,797,400		1,023,466		10,729,219		1,022,780		1,025,082		11,750,382		12,775,464		1,245,016	2005	40 yrs.
20825 Swenson Drive	Brookfield, WI		—		644,563		3,640,734		226,102		646,518		3,864,882		4,511,399		404,282	2006	40 yrs.
20935 Swenson Drive	Brookfield, WI		4,223,847		571,389		10,238,547		796,592		572,158		11,034,369		11,606,527		1,109,335	2005	40 yrs.
20700 Swenson Drive	Brookfield, WI		5,543,784		830,008		12,276,445		641,464		830,999		12,916,918		13,747,917		1,231,488	2005	40 yrs.
20975 Swenson Drive	Brookfield, WI		5,784,696		675,422		8,910,651		1,052,523		678,637		9,959,959		10,638,596		1,188,103	2005	40 yrs.
1485 W. Commerce Avenue	Carlisle, PA		—		4,249,868		13,886,039		840,856		4,253,027		14,723,737		18,976,764		1,422,465	2004	40 yrs.
3773 Corporate Parkway	Center Valley, PA		—		738,108				7,674,838		794,874		7,618,071		8,412,945		2,056,603	2001	40 yrs.
95 Kriner Road	Chambersburg, PA		—		8,695,501		—		28,510,384		9,407,871		27,798,014		37,205,885		146,890	2006	40 yrs.
1309 Executive Boulevard	Cheaspeake, VA		—		926,125				5,086,632		955,374		5,057,383		6,012,757		991,200	2001	40 yrs.
7 Carnegie Plaza	Cherry Hill, NJ		—		2,000,000		3,493,983		3,229,339		2,005,475		6,717,847		8,723,322		1,214,808	2004	40 yrs.
1305 Executive Boulevard	Chesapeake, VA		—		861,020				4,911,374		1,129,850		4,642,543		5,772,393		969,927	2002	40 yrs.
1313 Executive Boulevard	Chesapeake, VA		—		1,180,036				4,629,615		1,708,050		4,101,602		5,809,652		776,635	2002	40 yrs.
510 Independence Parkway	Chesapeake, VA		—		2,012,149		7,546,882		421,917		2,014,689		7,966,260		9,980,949		892,754	2005	40 yrs.
1301 Executive Boulevard	Chesapeake, VA		—		—		—		6,176,380		997,570		5,178,810		6,176,380		415,319	2005	40 yrs.
500 Independence Parkway	Chesapeake, VA		3,385,676		864,150		4,427,285		100,511		866,609		4,525,338		5,391,946		608,742	2004	40 yrs.
501 Independence Parkway	Chesapeake, VA		4,195,100		1,202,556		5,975,538		1,165,766		1,292,273		7,051,586		8,343,860		713,499	2005	40 yrs.
505 Independence Parkway	Chesapeake, VA		4,967,132		1,292,062		6,456,515		1,287,046		1,292,254		7,743,368		9,035,623		874,855	2005	40 yrs.
700 Independence Parkway	Chesapeake, VA		6,562,607		1,950,375		7,236,994		627,345		1,951,135		7,863,579		9,814,714		1,206,288	2004	40 yrs.
6230 Old Dobbin Lane	Colombia, MD		—		3,004,075		—		7,636,053		2,746,455		7,893,673		10,640,128		879,885	2004	40 yrs.
9101,9111,9115 Guilford Road	Columbia, MD		—		758,951		—		4,634,835		765,952		4,627,834		5,393,786		2,272,761	1984	40 yrs.
9125,9135,9145 Guilford Road	Columbia, MD		—		900,154		—		6,180,706		920,439		6,160,422	��	7,080,860		3,873,038	1983	40 yrs.
7178-80 Columbia Gateway	Columbia, MD		—		1,569,237		4,786,887		2,222,793		1,571,105		7,007,812		8,578,917		2,988,407	1987	40 yrs.
9770 Patuxent Woods Drive	Columbia, MD		—		341,663		3,033,309		1,323,686		341,663		4,356,995		4,698,658		1,227,401	1986	40 yrs.
9780 Patuxent Woods Drive	Columbia, MD		—		218,542		1,940,636		411,079		218,542		2,351,715		2,570,256		663,919	1986	40 yrs.
9790 Patuxent Woods Drive	Columbia, MD		—		243,791		2,164,094		328,903		243,791		2,492,997		2,736,787		813,025	1986	40 yrs.
9810 Patuxent Woods Drive	Columbia, MD		—		266,684		2,366,901		997,913		266,684		3,364,814		3,631,497		1,056,427	1986	40 yrs.
9800 Patuxent Woods Drive	Columbia, MD		—		299,099		2,654,069		535,352		299,099		3,189,421		3,488,521		1,016,848	1988	40 yrs.
9820 Patuxent Woods Drive	Columbia, MD		—		237,779		2,110,835		789,527		237,779		2,900,362		3,138,141		868,166	1988	40 yrs.
9830 Patuxent Woods Drive	Columbia, MD		—		296,262		2,628,933		899,462		296,262		3,528,395		3,824,658		906,195	1986	40 yrs.
9050 Red Branch Road	Columbia, MD		—		290,950		2,577,153		941,253		290,950		3,518,406		3,809,356		956,625	1972	40 yrs.
8945-8975 Guilford Road	Columbia, MD		—		2,428,795		7,493,740		1,700,856		2,427,065		9,196,326		11,623,391		2,606,842	1986	40 yrs.
6250 Old Dobbin Lane	Columbia, MD		—		958,105				3,681,791		1,295,000		3,344,897		4,639,897		828,694	2002	40 yrs.
6200 Old Dobbin Lane	Columbia, MD		—		958,105				3,742,985		1,295,000		3,406,090		4,701,090		751,338	2002	40 yrs.
6210 Old Dobbin Lane	Columbia, MD		—		958,105				3,931,442		1,307,300		3,582,247		4,889,547		869,611	2002	40 yrs.
6250 Old Dobbin Lane	Columbia, MD		—		958,105				3,869,631		1,599,259		3,228,478		4,827,737		603,986	2000	40 yrs.
9755 Patuxent Woods Drive	Columbia, MD		—		3,917,094		16,219,721		1,167,866		3,922,382		17,382,299		21,304,681		1,456,898	2006	40 yrs.
6220 Old Dobbin Lane	Columbis, MD		—		3,865,848		—		7,434,362		3,166,951		8,133,259		11,300,210		347,572	2006	40 yrs.
5150 International Drive	Cudahy, WI		—		739,673		5,108,025		250,327		741,858		5,356,167		6,098,024		755,510	2003	40 yrs.
1250 Hall Court	Deer Park, TX		2,983,023		829,570		4,778,327		47,398		831,611		4,823,685		5,655,296		272,813	2006	40 yrs.
170 Parkway West	Duncan, SC		—		598,348		3,643,756		126,879		598,918		3,770,065		4,368,983		315,732	2006	40 yrs.
190 Parkway West	Duncan, SC		—		551,663		3,463,858		111,209		552,211		3,574,519		4,126,730		325,727	2006	40 yrs.
265 Parkway East	Duncan, SC		—		901,444		5,751,389		18,391		902,374		5,768,850		6,671,224		592,047	2006	40 yrs.
285 Parkway East	Duncan, SC		—		975,433		6,149,465		39,409		976,393		6,187,914		7,164,307		723,255	2006	40 yrs.
3255 Neil Armstrong Boulevard	Eagan, MN		—		1,131,017		—		3,366,266		1,103,860		3,393,423		4,497,283		848,227	1998	40 yrs.
6321-6325 Bury Drive	Eden Prairie, MN		—		462,876		4,151,790		581,781		462,876		4,733,572		5,196,447		1,471,416	1988	40 yrs.
7660-7716 Golden Triangle Drive	Eden Prairie, MN		—		568,706		5,115,177		3,184,634		1,289,215		7,579,302		8,868,517		3,001,494	1988	40 yrs.
7400 Flying Cloud Drive	Eden Prairie, MN		—		195,982		1,762,027		959,527		754,062		2,163,474		2,917,536		547,299	1987	40 yrs.
10301-10305 West 70th Street	Eden Prairie, MN		—		120,622		1,085,226		321,867		118,300		1,409,415		1,527,715		363,556	1984	40 yrs.
10321 West 70th Street	Eden Prairie, MN		—		145,198		1,305,700		377,179		142,399		1,685,678		1,828,077		638,560	1984	40 yrs.
10333 West 70th Street	Eden Prairie, MN		—		110,746		995,868		93,888		108,610		1,091,892		1,200,502		364,395	1984	40 yrs.
10349-10357 West 70th Street	Eden Prairie, MN		—		275,903		2,481,666		449,591		270,584		2,936,576		3,207,160		936,102	1985	40 yrs.
10365-10375 West 70th Street	Eden Prairie, MN		—		291,077		2,618,194		364,782		285,464		2,988,589		3,274,053		959,256	1985	40 yrs.
10393-10394 West 70th Street	Eden Prairie, MN		—		269,618		2,423,318		785,407		264,419		3,213,924		3,478,343		973,584	1985	40 yrs.
7078 Shady Oak Road	Eden Prairie, MN		—		343,093		3,085,795		1,616,449		336,481		4,708,856		5,045,337		1,121,059	1985	40 yrs.
10400 Viking Drive	Eden Prairie, MN		—		2,912,391		—		23,353,685		2,938,372		23,327,703		26,266,076		7,312,972	1999	40 yrs.
7625 Smetana Lane	Eden Prairie, MN		—		4,500,641		—		2,987,800		1,916,609		5,571,833		7,488,442		335,245	2006	40 yrs.
7695-7699 Anagram Drive	Eden Prairie, MN		—		760,525		3,254,758		625,146		760,525		3,879,903		4,640,429		1,172,450	1997	40 yrs.
7800 Equitable Drive	Eden Prairie, MN		—		2,188,525		3,788,762		240,695		2,188,525		4,029,456		6,217,981		1,152,337	1993	40 yrs.
7905 Fuller Road	Eden Prairie, MN		—		1,229,862		4,075,167		2,051,136		1,230,965		6,125,200		7,356,165		1,369,000	1994	40 yrs.
9023 Columbine Road	Eden Prairie, MN		—		1,956,273		—		4,873,578		1,956,273		4,873,578		6,829,851		1,350,783	1999	40 yrs.
8967 Columbine Road	Eden Prairie, MN		—		1,450,000		—		3,575,107		1,450,000		3,575,107		5,025,107		920,084	2000	40 yrs.
7777 Golden Triangle Drive	Eden Prairie, MN		—		993,101		2,136,862		1,176,757		993,101		3,313,619		4,306,720		802,540	2000	40 yrs.
8937 Columbine Road	Eden Prairie, MN		—		1,325,829				4,287,274		1,739,966		3,873,137		5,613,103		873,485	2001	40 yrs.
7615 Smetana Lane	Eden Prairie, MN		—		1,011,517				8,665,025		3,000,555		6,675,988		9,676,542		1,756,942	2001	40 yrs.

53

								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
8995 Columbine Road	Eden Prairie, MN		—		1,087,594				3,664,053		2,055,296		2,696,352		4,751,648		595,546	2001	40 yrs.
8911 Columbine Road (B2)	Eden Prairie, MN		—		916,687				3,608,469		1,718,407		2,806,748		4,525,156		535,211	2000	40 yrs.
8855 Columbine Road	Eden Prairie, MN		—		1,400,925				5,226,016		1,599,757		5,027,185		6,626,941		581,470	2000	40 yrs.
7075 Flying Cloud Drive	Eden Prairie, MN		—		10,232,831		10,855,851		53,337		10,243,977		10,898,042		21,142,019		500,941	2007	40 yrs.
7351 Coca Cola Drive	Elkridge, MD		—		1,897,044		—		7,048,446		3,023,417		5,922,074		8,945,491		224,957	2006	40 yrs.
180 Sheree Boulevard	Exton, PA		5,157,523		2,647,861		11,334,403		2,049,934		2,649,426		13,382,772		16,032,198		1,066,878	2007	40 yrs.
7028 Snowdrift Road	Fogelville, PA		—		520,473		959,279		292,813		524,390		1,248,175		1,772,565		371,902	1982	40 yrs.
420 Delaware Drive	Fort Washington, PA		—		2,766,931		—		8,290,888		2,826,994		8,230,825		11,057,819		571,917	2005	40 yrs.
414 Commerce Drive	Fort Washington, PA		—		1,267,194		2,217,460		307,900		1,267,937		2,524,616		3,792,553		231,189	2004	40 yrs.
275 Commerce Drive	Fort Washington, PA		—		1,775,894		2,160,855		7,433,770		1,790,041		9,580,478		11,370,519		142,837	2005	40 yrs.
1250 Virginia Drive	Fort Washington, PA		—		1,639,166		1,928,574		468,379		1,650,703		2,385,416		4,036,119		224,244	2005	40 yrs.
1100 Virginia Drive	Fort Washington, PA		—		22,612,437		—		55,809,125		23,339,943		55,081,619		78,421,562		2,007,575	2006	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		915,103	2006	40 yrs.
106 Southchase Boulevard	Fountain Inn, SC		—		201,944		—		5,133,389		684,003		4,651,330		5,335,333		358,667	2005	40 yrs.
9601 Cosner Drive	Fredericksburg, VA		—		475,262		3,917,234		214,221		475,262		4,131,454		4,606,716		1,391,089	1995	40 yrs.
200 W Cypress Creek Road	Ft Lauderdale, FL		—		3,414,989		2,399,738		10,524,649		3,414,989		12,924,387		16,339,376		1,924,698	2003	40 yrs.
5410 - 5430 Northwest 33rd Avenue	Ft. Lauderdale, FL		—		603,776		4,176,238		1,156,270		625,111		5,311,174		5,936,284		1,660,664	1985	40 yrs.
6500 NW 12th Avenue	Ft. Lauderdale, FL		—		7,099		3,046,309		475,723		—		3,529,130		3,529,130		1,143,136	1989	40 yrs.
6600 NW 12th Avenue	Ft. Lauderdale, FL		—		7,102		3,047,462		772,549		—		3,827,114		3,827,114		1,136,170	1989	40 yrs.
4880 Cox Road	Glen Allen, VA		—		743,898		4,499,807		3,058,575		743,898		7,558,382		8,302,280		1,840,837	1995	40 yrs.
5000 Cox Road	Glen Allen, VA		—		770,214		3,685,248		315,413		771,029		3,999,846		4,770,875		1,331,758	1990	40 yrs.
5500 Cox Road	Glen Allen, VA		—		443,485		—		3,546,671		483,263		3,506,893		3,990,156		1,152,858	1999	40 yrs.
4801 Cox Road	Glen Allen, VA		—		1,072,896		—		10,198,472		1,075,620		10,195,748		11,271,368		3,297,151	1998	40 yrs.
4198 Cox Road	Glen Allen, VA		—		670,292		3,839,245		1,241,555		670,292		5,080,800		5,751,092		1,645,466	1984	40 yrs.
4510 Cox Road	Glen Allen, VA		—		1,010,024		7,151,729		1,907,500		1,010,044		9,059,209		10,069,253		3,108,655	1990	40 yrs.
4121 Cox Road	Glen Allen, VA		—		1,083,006		6,035,653		952,101		1,083,006		6,987,754		8,070,760		955,534	2004	40 yrs.
200 Southchase Boulevard	Greenville, SC		—		512,911				6,273,615		515,542		6,270,984		6,786,525		792,280	2003	40 yrs.
45 Brookfield Oaks Drive	Greenville, SC		—		818,114		—		3,549,097		825,529		3,541,682		4,367,212		118,418	2006	40 yrs.
116 Pleasant Ridge Road	Greenville, SC		—		1,547,811		—		13,298,582		3,712,683		11,133,710		14,846,393		131,493	2006	40 yrs.
7 Research Drive	Greenville, SC		—		—		17,091,882		4,405		—		17,096,287		17,096,287		752,159	2007	40 yrs.
1487 South Highway 101	Greer, SC		—		464,237		—		5,136,776		1,301,738		4,299,275		5,601,012		13,817	2007	40 yrs.
1 Enterprise Parkway	Hampton, VA		—		974,675		5,579,869		1,433,088		974,675		7,012,957		7,987,632		2,255,340	1987	40 yrs.
22 Enterprise Parkway	Hampton, VA		—		1,097,368		6,760,778		1,257,471		1,097,368		8,018,248		9,115,617		2,462,312	1990	40 yrs.
5 Manhattan Square	Hampton, VA		—		207,368		—		1,663,695		212,694		1,658,368		1,871,063		543,765	1999	40 yrs.
1317 Executive Boulevard	Hampton, VA		—		1,650,423		—		7,668,631		1,128,829		8,190,225		9,319,054		348,381	2006	40 yrs.
21 Enterprise Parkway	Hampton, VA		—		263,668		8,167,118		382,338		265,719		8,547,405		8,813,124		1,848,003	1999	40 yrs.
521 Butler Farm Road	Hampton, VA		—		750,769		2,911,149		261,271		710,486		3,212,702		3,923,188		464,095	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		570,967	1983	40 yrs.
600 Industrial Drive	Harrisburg, PA		—		7,743,800		—		28,472,202		9,368,557		26,847,444		36,216,001		1,554,062	2005	40 yrs.
500 McCarthy Drive	Harrisburg, PA		—		5,194,872		19,991,436		4,234,765		5,687,013		23,734,060		29,421,073		3,011,485	2005	40 yrs.
4170 Mendenhall Oaks Parkway	High Point , NC		—		143,699		—		2,210,943		373,502		1,981,140		2,354,642		655,531	1999	40 yrs.
4180 Mendenhall Oaks Parkway	High Point , NC		—		121,329		—		1,835,505		315,614		1,641,220		1,956,834		584,926	1999	40 yrs.
4050 Piedmont Parkway	High Point , NC		—		801,902		—		20,721,590		2,042,159		19,481,334		21,523,492		5,353,041	1998	40 yrs.
4523 Green Point Drive	High Point, NC		—		234,564		—		3,109,110		235,698		3,107,976		3,343,674		1,269,229	1988	40 yrs.
4501 Green Point Drive	High Point, NC		—		319,289		—		2,606,925		320,450		2,605,765		2,926,214		1,303,596	1989	40 yrs.
4500 Green Point Drive	High Point, NC		—		230,622		—		2,310,319		231,692		2,309,249		2,540,941		1,196,924	1989	40 yrs.
2427 Penny Road	High Point, NC		—		1,165,664		—		3,476,301		655,240		3,986,724		4,641,965		1,791,684	1990	40 yrs.
4524 Green Point Drive	High Point, NC		—		182,810		—		2,396,132		183,888		2,395,053		2,578,942		1,194,991	1989	40 yrs.
4344 Federal Drive	High Point, NC		—		484,001		—		2,780,986		173,623		3,091,365		3,264,988		1,223,712	1996	40 yrs.
4000 Piedmont Parkway	High Point, NC		—		592,885		4,825,615		929,937		597,368		5,751,069		6,348,438		2,122,813	1989	40 yrs.
4380 Federal Drive	High Point, NC		—		282,996		—		2,204,882		283,368		2,204,510		2,487,878		859,427	1997	40 yrs.
4388 Federal Drive	High Point, NC		—		143,661		—		1,210,692		132,655		1,221,699		1,354,353		492,073	1997	40 yrs.
4160 Mendenhall Oaks Parkway	High Point, NC		—		285,882		—		3,361,383		545,627		3,101,638		3,647,265		1,010,657	1998	40 yrs.
4194 Mendenhall Oaks Parkway	High Point, NC		—		102,372		—		2,619,333		265,991		2,455,714		2,721,705		830,855	1999	40 yrs.
4196 Mendenhall Oaks Parkway	High Point, NC		—		66,731		—		2,510,094		173,889		2,402,936		2,576,825		857,473	1999	40 yrs.
4300 Federal Drive	High Point, NC		—		264,038		—		2,098,260		276,038		2,086,260		2,362,298		472,345	1998	40 yrs.
4135 Mendenall Oaks Parkway	High Point, NC		—		499,500		—		3,498,674		500,980		3,497,193		3,998,174		863,928	2000	40 yrs.
1498 Eagle Hill Drive	High Point, NC		—		94,274		—		5,933,606		791,880		5,235,999		6,027,879		220,175	2005	40 yrs.
4183 Eagle Hill Drive	High Point, NC		—		122,203				3,911,210		526,266		3,507,147		4,033,413		1,389,311	2001	40 yrs.
4189 Eagle Hill Drive	High Point, NC		—		100,106				3,430,006		431,106		3,099,006		3,530,112		888,462	2001	40 yrs.
4020 Meeting Way	High Point, NC		—		94,232				1,682,549		378,101		1,398,680		1,776,781		377,882	2001	40 yrs.
1400 Mendenhall Oaks Parkway	High Point, NC		—		172,320				7,281,025		984,672		6,468,673		7,453,345		1,437,607	2002	40 yrs.
4191 Mendenhall Oaks Parkway	High Point, NC		—		217,943				3,114,814		611,166		2,721,590		3,332,756		587,303	2002	40 yrs.
4015 Meeting Way	High Point, NC		—		510,000		—		2,787,760		511,869		2,785,890		3,297,759		296,429	2003	40 yrs.
4195 Eagle Hill Drive	High Point, NC		—		107,586		—		3,425,118		505,700		3,027,005		3,532,705		307,026	2004	40 yrs.
400 Mendenhall Oaks Parkway	High Point, NC		—		—		—		1,859,604		665,239		1,194,365		1,859,604		80,912	2004	40 yrs.
4475 Premier Drive	High Point, NC		—		748,693		—		5,888,692		1,525,421		5,111,964		6,637,385		86,535	2006	40 yrs.
4328, 4336 Federal Drive	High Point, NC		3,977,231		521,122		—		7,300,519		825,092		6,996,548		7,821,641		3,907,767	1995	40 yrs.
100 Witmer Road	Horsham, PA		—		3,102,784		—		18,701,183		3,764,784		18,039,184		21,803,967		3,510,902	1996	40 yrs.
132 Welsh Road	Horsham, PA		—		1,333,642		—		4,692,880		1,408,041		4,618,480		6,026,521		1,665,412	1998	40 yrs.
300 Welsh Road — Building 3	Horsham, PA		—		180,459		1,441,473		375,923		180,459		1,817,396		1,997,855		664,949	1983	40 yrs.
300 Welsh Road — Building 4	Horsham, PA		—		282,493		2,256,508		1,843,483		282,493		4,099,990		4,382,483		1,340,245	1983	40 yrs.
2 Walnut Grove Drive	Horsham, PA		—		1,281,870		7,767,374		1,961,590		1,265,363		9,745,470		11,010,834		3,415,954	1989	40 yrs.
5 Walnut Grove Drive	Horsham, PA		—		1,065,951		—		10,117,753		1,939,712		9,243,992		11,183,704		2,280,276	2000	40 yrs.
200 Gibraltar Road	Horsham, PA		—		638,513		5,811,323		1,947,714		638,513		7,759,036		8,397,550		2,878,638	1990	40 yrs.
220 Gibraltar Road	Horsham, PA		—		629,944		5,733,228		1,455,917		629,944		7,189,145		7,819,089		2,644,772	1990	40 yrs.

54

								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
240 Gibraltar Road	Horsham, PA		—		629,944		5,733,234		1,915,620		629,944		7,648,854		8,278,798		2,937,215	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		2,345,767	1986	40 yrs.
181-187 Gibraltar Road	Horsham, PA		—		360,549		3,259,984		787,154		360,549		4,047,138		4,407,687		1,336,533	1982	40 yrs.
104 Rock Road	Horsham, PA		—		330,111		2,981,669		594,916		330,111		3,576,586		3,906,696		941,454	1974	40 yrs.
123-135 Rock Road	Horsham, PA		—		292,360		2,411,677		2,409,782		393,019		4,720,800		5,113,819		1,162,452	1975	40 yrs.
111-159 Gibraltar Road	Horsham, PA		—		489,032		4,126,151		1,367,375		489,032		5,493,526		5,982,558		1,693,767	1981	40 yrs.
161-175 Gibraltar Road	Horsham, PA		—		294,673		2,663,722		987,299		294,673		3,651,020		3,945,694		1,105,985	1976	40 yrs.
103-109 Gibraltar Road	Horsham, PA		—		270,906		2,448,500		818,872		270,906		3,267,371		3,538,278		1,270,550	1978	40 yrs.
210-223 Witmer Road	Horsham, PA		—		270,282		2,441,276		1,940,611		270,282		4,381,887		4,652,169		1,282,445	1972	40 yrs.
100 Gibraltar Road	Horsham, PA		—		38,729		349,811		9,589		38,729		359,400		398,129		99,409	1975	40 yrs.
101 Gibraltar Road	Horsham, PA		—		651,990		5,888,989		1,561,435		732,552		7,369,862		8,102,414		2,305,103	1977	40 yrs.
506 Prudential Road	Horsham, PA		—		208,140		895,470		723,059		208,140		1,618,529		1,826,669		440,823	1973	40 yrs.
113-123 Rock Road	Horsham, PA		—		351,072		3,171,001		589,814		451,731		3,660,155		4,111,887		1,012,999	1975	40 yrs.
101-111 Rock Road	Horsham, PA		—		350,561		3,166,389		864,263		452,251		3,928,962		4,381,213		1,231,119	1975	40 yrs.
120 Gibraltar Road	Horsham, PA		—		533,142		4,830,515		2,416,512		558,142		7,222,027		7,780,169		1,897,838	1980	40 yrs.
110 Gibraltar Road	Horsham, PA		—		673,041		5,776,369		2,584,619		673,041		8,360,988		9,034,029		2,534,483	1979	40 yrs.
100-107 Lakeside Drive	Horsham, PA		—		239,528		2,163,498		712,712		255,528		2,860,210		3,115,738		976,181	1982	40 yrs.
200-264 Lakeside Drive	Horsham, PA		—		502,705		4,540,597		1,536,610		502,705		6,077,207		6,579,912		1,814,424	1982	40 yrs.
300-309 Lakeside Drive	Horsham, PA		—		369,475		3,338,761		1,842,034		376,475		5,173,795		5,550,270		1,986,944	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		2,476,732	1981	40 yrs.
201 Gibraltar Road	Horsham, PA		—		380,127		3,433,433		1,997,494		380,802		5,430,252		5,811,054		1,627,010	1983	40 yrs.
300 Welsh Road	Horsham, PA		—		696,061		3,339,991		570,429		696,061		3,910,420		4,606,480		1,115,040	1985	40 yrs.
700 Dresher Road	Horsham, PA		—		2,551,777		3,020,638		4,696,950		2,565,140		7,704,225		10,269,365		3,764,912	1987	40 yrs.
680 Blair Mill Road	Horsham, PA		—		3,527,151				17,434,151		4,138,577		16,822,725		20,961,302		3,116,684	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		662,819	1985	40 yrs.
335 Commerce Drive	Horsham, PA		—		—		—		8,757,475		182,400		8,575,075		8,757,475		1,064,979	2002	40 yrs.
255 Business Center Drive	Horsham, PA		—		1,154,289		2,007,214		573,608		1,140,597		2,594,513		3,735,111		391,690	2003	40 yrs.
355 Business Center Drive	Horsham, PA		—		483,045		898,798		253,426		471,171		1,164,098		1,635,270		243,111	2003	40 yrs.
455 Business Center Drive	Horsham, PA		—		1,351,011		2,503,449		1,927,940		1,322,317		4,460,083		5,782,400		1,031,964	2003	40 yrs.
555 Business Center Drive	Horsham, PA		—		727,420		1,353,650		194,047		709,967		1,565,151		2,275,118		345,712	2003	40 yrs.
7 Walnut Grove Drive	Horsham, PA		—		2,631,696		—		18,587,588		2,631,956		18,587,328		21,219,284		621,811	2006	40 yrs.
261-283 Gibraltar Road	Horsham, PA		*		464,871		3,951,972		1,775,341		464,871		5,727,312		6,192,183		1,216,076	1978	40 yrs.
231-237 Gibraltar Road	Horsham, PA		*		436,952		3,948,963		727,352		436,952		4,676,314		5,113,267		1,504,124	1981	40 yrs.
104 Witmer Road	Horsham, PA		*		1,248,148		—		1,133,749		189,793		2,192,104		2,381,897		931,792	1975	40 yrs.
719 Dresher Road	Horsham, PA		*		493,426		2,812,067		251,335		495,112		3,061,716		3,556,828		851,187	1987	40 yrs.
4 Walnut Grove	Horsham, PA		*		2,515,115		—		10,792,470		2,515,115		10,792,470		13,307,585		1,870,755	1999	40 yrs.
747 Dresher Road	Horsham, PA		—		1,607,238		—		5,193,398		1,607,977		5,192,658		6,800,636		2,713,953	1988	40 yrs.
507 Prudential Road	Horsham, PA		—		644,900		5,804,100		8,818,780		1,131,380		14,136,400		15,267,780		4,600,504	1988	40 yrs.
767 Electronic Drive	Horsham, PA		*		1,229,685		—		3,430,171		1,241,970		3,417,886		4,659,856		1,742,609	1996	40 yrs.
16445 Air Center Boulevard	Houston, TX		—		363,339		2,509,186		641,300		363,339		3,150,486		3,513,826		1,208,934	1997	40 yrs.
16405 Air Center Boulevard	Houston, TX		—		438,853		3,030,396		438,371		438,853		3,468,766		3,907,619		1,057,848	1997	40 yrs.
16580 Air Center Boulevard	Houston, TX		—		289,000		3,559,857		269,417		289,000		3,829,274		4,118,275		1,055,346	1997	40 yrs.
1755 Trans Central Drive	Houston, TX		—		293,534		3,036,269		190,651		306,147		3,214,306		3,520,453		752,950	1999	40 yrs.
16680 Central Green Boulevard	Houston, TX		—		311,952		—		3,956,813		492,869		3,775,895		4,268,765		83,075	2001	40 yrs.
16605 Air Center Boulevard	Houston, TX		—		298,999				3,770,315		496,186		3,573,128		4,069,314		988,599	2002	40 yrs.
10739 West Little York Road	Houston, TX		—		797,931		5,950,894		321,145		799,560		6,270,410		7,069,970		1,161,015	1999	40 yrs.
10735 West Little York Road	Houston, TX		—		1,110,988		6,351,946		1,711,950		1,135,483		8,039,401		9,174,884		1,159,934	2000	40 yrs.
8801-19 & 8821-49 Fallbrook Drive	Houston, TX		—		2,290,001		15,297,141		1,590,836		2,290,002		16,887,976		19,177,978		2,452,452	2000	40 yrs.
16685 Air Center Boulevard	Houston, TX		—		—		—		2,935,268		414,691		2,520,577		2,935,268		339,028	2004	40 yrs.
8825-8839 N Sam Houston Pkwy	Houston, TX		—		638,453		3,258,815		565,588		638,477		3,824,378		4,462,856		531,488	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		563,067	2004	40 yrs.
8802-8824 Fallbrook Drive	Houston, TX		—		1,114,406		6,364,767		2,636,014		2,775,021		7,340,166		10,115,187		1,029,169	2004	40 yrs.
16602 Central Green Boulevard	Houston, TX		—		284,403		—		4,495,522		503,779		4,276,146		4,779,925		356,764	2005	40 yrs.
1646 Rankin Road	Houston, TX		—		329,961		—		4,895,126		592,234		4,632,853		5,225,087		384,256	2005	40 yrs.
8301 Fallbrook Drive	Houston, TX		—		4,515,862		—		23,627,618		5,877,884		22,265,596		28,143,480		334,684	2006	40 yrs.
5200 N. Sam Houston Parkway	Houston, TX		—		1,519,458		7,135,548		2,697,458		1,520,074		9,832,389		11,352,464		332,982	2007	40 yrs.
5250 N. Sam Houston Parkway	Houston, TX		—		2,173,287		8,868,256		1,972,563		2,173,942		10,840,164		13,014,106		306,826	2007	40 yrs.
11201 Greens Crossing Boulevard	Houston, TX		—		1,006,194		5,412,584		2,705,102		1,008,542		8,115,337		9,123,879		229,320	2007	40 yrs.
850 Greens Parkway	Houston, TX		—		2,893,405		11,593,197		2,456,282		2,899,861		14,043,023		16,942,883		340,455	2007	40 yrs.
860 Greens Parkway	Houston, TX		—		1,399,365		6,344,650		1,528,602		1,374,012		7,898,606		9,272,618		193,441	2007	40 yrs.
20 Wright Avenue	Hunt Valley, MD		—		1,205,946		—		9,645,838		1,861,025		8,990,759		10,851,784		2,048,033	2001	40 yrs.
4 North Park Drive	Hunt Valley, MD		—		3,269,948		13,551,370		1,458,110		3,269,948		15,009,480		18,279,428		2,150,558	2003	40 yrs.
6 North Park Drive	Hunt Valley, MD		—		2,077,949		8,770,566		984,562		2,077,949		9,755,128		11,833,077		1,644,000	2003	40 yrs.
10 North Park Drive	Hunt Valley, MD		—		2,211,969		7,816,042		238,720		2,211,969		8,054,762		10,266,731		1,069,482	2003	40 yrs.
307 International Circle	Hunt Valley, MD		—		3,538,319		14,190,832		13,353,055		3,542,881		27,539,324		31,082,206		2,691,105	2004	40 yrs.
309 International Circle	Hunt Valley, MD		—		613,667		2,458,204		700,193		615,096		3,156,968		3,772,064		302,865	2004	40 yrs.
311 International Circle	Hunt Valley, MD		—		313,365		1,281,093		76,921		314,572		1,356,807		1,671,380		108,395	2004	40 yrs.
8775 Baypine Road	Jacksonville, FL		—		906,804		—		10,034,442		913,013		10,028,233		10,941,246		2,358,535	1989	40 yrs.
8665,8667,8669 Baypine Road	Jacksonville, FL		—		966,552		—		5,987,169		974,959		5,978,762		6,953,721		3,075,507	1987	40 yrs.
7970 Bayberry Road	Jacksonville, FL		—		127,520		—		1,391,397		129,979		1,388,938		1,518,917		1,104,987	1978	40 yrs.
7077 Bonneval Road	Jacksonville, FL		—		768,000		5,789,000		3,526,767		774,020		9,309,747		10,083,767		4,201,227	1988	40 yrs.
4190 Belfort Road	Jacksonville, FL		—		821,000		5,866,000		3,356,397		827,420		9,215,977		10,043,397		4,496,680	1986	40 yrs.
7020 AC Skinner Parkway	Jacksonville, FL		—		398,257		—		2,717,001		749,811		2,365,448		3,115,258		1,158,479	1996	40 yrs.
7022 AC Skinner Parkway	Jacksonville, FL		—		706,934		—		3,572,340		853,981		3,425,294		4,279,274		1,510,930	1996	40 yrs.
11777 Central Highway	Jacksonville, FL		—		92,207		429,997		1,275,050		140,426		1,656,828		1,797,254		1,127,183	1985	40 yrs.
4345 Southpoint Parkway	Jacksonville, FL		—		—		—		8,791,159		418,093		8,373,065		8,791,159		2,765,051	1998	40 yrs.

55

								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
7016 AC Skinner Parkway	Jacksonville, FL		—		597,181		—		2,373,250			602,633		2,367,799		2,970,431		1,140,862	1996	40 yrs.
7018 AC Skinner Parkway	Jacksonville, FL		—		840,996		—		4,694,026			846,461		4,688,561		5,535,022		2,186,102	1997	40 yrs.
7014 AC Skinner Parkway	Jacksonville, FL		—		574,198		—		3,580,008			780,486		3,373,720		4,154,206		1,385,190	1999	40 yrs.
6620 Southpoint Drive	Jacksonville, FL		—		614,602		4,267,477		1,017,166			614,602		5,284,642		5,899,245		1,858,105	1984	40 yrs.
7980 Bayberry Road	Jacksonville, FL		—		330,726		1,338,101		17,776			330,726		1,355,877		1,686,603		394,141	1978	40 yrs.
6600 Southpoint Parkway	Jacksonville, FL		—		998,432		4,055,727		828,152			1,002,704		4,879,607		5,882,311		1,750,059	1986	40 yrs.
6700 Southpoint Parkway	Jacksonville, FL		—		620,719		2,989,746		789,809			624,215		3,776,060		4,400,274		1,563,846	1987	40 yrs.
4801 Executive Park Court - 100	Jacksonville, FL		—		554,993		2,993,277		1,358,664			554,542		4,352,392		4,906,935		1,671,990	1990	40 yrs.
4801 Executive Park Court - 200	Jacksonville, FL		—		370,017		1,995,518		367,780			370,039		2,363,276		2,733,315		759,393	1990	40 yrs.
4810 Executive Park Court	Jacksonville, FL		—		369,694		3,045,639		1,007,513			370,039		4,052,807		4,422,846		1,281,897	1990	40 yrs.
6602 Executive Park Court - 100	Jacksonville, FL		—		388,519		2,095,293		299,475			388,541		2,394,745		2,783,287		790,611	1993	40 yrs.
6602 Executive Park Court - 200	Jacksonville, FL		—		296,014		1,596,347		453,476			296,032		2,049,805		2,345,837		645,669	1993	40 yrs.
6631 Executive Park Court - 100	Jacksonville, FL		—		251,613		1,356,849		525,120			251,627		1,881,955		2,133,582		791,232	1994	40 yrs.
6631 Executive Park Court - 200	Jacksonville, FL		—		406,561		2,195,070		274,915			407,043		2,469,503		2,876,546		817,142	1994	40 yrs.
4815 Executive Park Court - 100	Jacksonville, FL		—		366,317		1,975,393		409,677			366,339		2,385,048		2,751,387		876,448	1995	40 yrs.
4815 Executive Park Court - 200	Jacksonville, FL		—		462,522		2,494,397		512,344			462,549		3,006,713		3,469,263		1,049,949	1995	40 yrs.
4825 Executive Park Court	Jacksonville, FL		—		601,278		3,242,491		287,899			601,401		3,530,267		4,131,668		1,166,422	1996	40 yrs.
4820 Executive Park Court	Jacksonville, FL		—		555,173		2,693,130		777,785			555,213		3,470,875		4,026,088		1,111,648	1997	40 yrs.
6601 Executive Park Circle North	Jacksonville, FL		—		551,250		3,128,361		110,993			551,250		3,239,353		3,790,603		876,571	1992	40 yrs.
4901 Belfort Road	Jacksonville, FL		—		877,964		2,360,742		2,857,775			877,964		5,218,517		6,096,481		2,096,702	1986	40 yrs.
4875 Belfort Road	Jacksonville, FL		—		2,089,347		—		12,746,697			2,287,152		12,548,892		14,836,044		19,127	1998	40 yrs.
4899 Belfort Road	Jacksonville, FL		—		1,299,201		—		8,299,049			1,168,062		8,430,188		9,598,250		2,332,310	2000	40 yrs.
4905 Belfort Street	Jacksonville, FL		—		638,154		—		3,467,521			641,272		3,464,403		4,105,675		1,067,726	2000	40 yrs.
7251 Salisbury Road	Jacksonville, FL		—		—		—		3,567,820			662,559		2,905,261		3,567,820		883,202	2000	40 yrs.
10245 Centurion Parkway North	Jacksonville, FL		—		852,644		3,510,889		1,038,509			853,704		4,548,337		5,402,042		1,287,220	1996	40 yrs.
4887 Belfort Road	Jacksonville, FL		—		1,299,202				8,013,821			1,665,915		7,647,107		9,313,022		2,008,217	2002	40 yrs.
7255 Salisbury Road	Jacksonville, FL		—		392,060				2,975,677			680,766		2,686,971		3,367,737		700,627	2002	40 yrs.
5201 Gate Parkway	Jacksonville, FL		—		3,836,532		—		21,433,694			4,269,346		21,000,880		25,270,226		2,025,647	2005	40 yrs.
3200 Horizon Drive	King of Prussia, PA		—		928,637		—		7,121,324			1,210,137		6,839,824		8,049,961		2,905,022	1996	40 yrs.
440 East Swedesford Road	King of Prussia, PA		—		717,001		4,816,121		3,338,962			717,001		8,155,083		8,872,084		3,226,346	1988	40 yrs.
460 East Swedesford Road	King of Prussia, PA		—		705,317		4,737,487		4,321,549			705,317		9,059,036		9,764,353		2,487,896	1988	40 yrs.
151 South Warner Road	King of Prussia, PA		—		1,218,086		6,937,866		6,630,138			1,186,972		13,599,118		14,786,090		283,014	1980	40 yrs.
3604 Horizon Drive	King of Prussia, PA		—		397,178		—		1,628,625			350,874		1,674,929		2,025,803		750,858	1998	40 yrs.
3606 Horizon Drive	King of Prussia, PA		—		789,409		—		2,125,279			815,855		2,098,833		2,914,688		876,136	1997	40 yrs.
650 Swedesford Road	King of Prussia, PA		—		952,911		6,722,830		9,556,741			952,911		16,279,570		17,232,481		7,018,413	1971	40 yrs.
680 Swedesford Road	King of Prussia, PA		—		952,361		6,722,830		8,367,206			952,361		15,090,036		16,042,397		6,558,527	1971	40 yrs.
3600 Horizon Drive	King of Prussia, PA		—		236,432		1,856,252		784,645			236,432		2,640,897		2,877,328		758,733	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		677,108	1989	40 yrs.
2700 Horizon Drive	King of Prussia, PA		—		764,370		—		4,242,628			867,815		4,139,183		5,006,998		1,403,069	1998	40 yrs.
2900 Horizon Drive	King of Prussia, PA		—		679,440		—		3,503,074			774,096		3,408,418		4,182,514		1,096,966	1998	40 yrs.
2500 Renaissance Boulevard	King of Prussia, PA		—		509,580		—		2,866,474			592,886		2,783,167		3,376,054		1,104,642	1999	40 yrs.
2300 Renaissance Boulevard	King of Prussia, PA		—		509,580		—		3,042,297			574,152		2,977,725		3,551,877		958,737	1999	40 yrs.
2100 Renaissance Boulevard	King of Prussia, PA		—		1,110,111		—		9,339,057			1,132,519		9,316,649		10,449,169		3,018,221	1999	40 yrs.
3400 Horizon Drive	King of Prussia, PA		—		776,496		3,139,068		1,276,655			776,496		4,415,723		5,192,219		1,336,234	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		6,028,262	2002	40 yrs.
2520 Renaissance Boulevard	King of Prussia, PA		—		1,020,000		—		5,015,045			978,402		5,056,643		6,035,045		2,170,675	1999	40 yrs.
2201 Renaissance Boulevard	King of Prussia, PA		—		—		—		18,888,377			2,413,514		16,474,863		18,888,377		3,917,910	2000	40 yrs.
2540 Renaissance Boulevard	King of Prussia, PA		—		—		—		1,625,497			274,341		1,351,156		1,625,497		439,087	2000	40 yrs.
2560 Renaissance Boulevard	King of Prussia, PA		—		—		—		3,729,254			649,792		3,079,462		3,729,254		983,905	2000	40 yrs.
170 South Warner Road	King of Prussia, PA		—		547,800		3,137,400		3,987,694			458,232		7,214,662		7,672,894		3,544,518	1980	40 yrs.
190 South Warner Road	King of Prussia, PA		—		552,200		3,162,600		1,647,906			461,909		4,900,797		5,362,706		2,466,986	1980	40 yrs.
3500 Horizon Drive	King of Prussia, PA		—		1,204,839		—		2,630,229			1,223,875		2,611,193		3,835,068		827,303	1996	40 yrs.
3000 Horizon Drive	King of Prussia, PA		—		1,191,449		—		2,309,358			946,703		2,554,103		3,500,806		688,183	1997	40 yrs.
3100 Horizon Drive	King of Prussia, PA		*		601,956		—		2,068,047			611,436		2,058,568		2,670,003		842,426	1995	40 yrs.
11425 State Highway 225	LaPorte, TX		—		975,974		3,409,036		8,956			977,542		3,416,424		4,393,966		274,812	2006	40 yrs.
11503 State Highway 225	LaPorte, TX		—		2,561,931		9,779,023		22,961			2,566,047		9,797,868		12,363,915		627,449	2006	40 yrs.
7528 Walker Way	Lehigh Valley, PA		—		893,441		—		5,510,455			779,330		5,624,567		6,403,897		581,674	2004	40 yrs.
8500 Willard Drive	Lehigh, PA		—		6,398,815		—		21,593,357			7,640,417		20,351,755		27,992,172		238,144	2004	40 yrs.
8301 Industrial Boulevard	Lehigh, PA		—		11,249,550		—		44,324,333			11,254,716		44,319,167		55,573,883		3,543,014	2005	40 yrs.
31700 Research Park Drive	Madison Heights, MI		—		373,202		1,824,721		(158,513	)		373,203		1,666,207		2,039,410		474,553	1988	40 yrs.
31811 Sherman Avenue	Madison Heights, MI		—		207,599		1,179,010		(152,186	)		207,599		1,026,824		1,234,423		315,809	1983	40 yrs.
1201 East Whitcomb Avenue	Madison Heights, MI		—		302,567		1,213,232		(167,324	)		302,567		1,045,908		1,348,475		338,473	1980	40 yrs.
1901 Summit Tower Boulevard	Maitland, FL		—		6,078,791		12,348,567		2,270,262			6,083,206		14,614,415		20,697,621		3,698,818	1998	40 yrs.
45-67 Great Valley Parkway	Malvern, PA		—		795,143		—		4,196,561			795,831		4,195,873		4,991,704		2,393,329	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		10,408,833	1986	40 yrs.
27-43 Great Valley Parkway	Malvern, PA		—		448,775		—		2,545,542			449,447		2,544,870		2,994,317		1,684,414	1977	40 yrs.
1 Country View Road	Malvern, PA		—		400,000		3,600,000		1,004,647			406,421		4,598,226		5,004,647		1,810,575	1982	40 yrs.
200 Chesterfield Parkway	Malvern, PA		—		495,893		2,739,093		649,407			588,384		3,296,009		3,884,393		2,113,705	1989	40 yrs.
50 Morehall Road	Malvern, PA		—		849,576		—		13,051,932			1,337,076		12,564,432		13,901,508		5,256,060	1997	40 yrs.
1 Great Valley Parkway	Malvern, PA		—		419,460		3,792,570		330,704			419,460		4,123,273		4,542,734		1,272,070	1982	40 yrs.
5 Great Valley Parkway	Malvern, PA		—		684,200		6,181,661		1,594,348			684,200		7,776,009		8,460,209		2,367,337	1983	40 yrs.
1001 Cedar Hollow Road	Malvern, PA		—		1,436,814		—		16,097,184			1,676,470		15,857,528		17,533,998		6,046,629	1998	40 yrs.
3 Country View Road	Malvern, PA		—		814,278		—		4,946,433			1,128,881		4,631,830		5,760,711		1,237,565	1998	40 yrs.
425 Technology Drive	Malvern, PA		—		191,114		—		2,112,927			321,473		1,982,568		2,304,041		846,015	1998	40 yrs.
375 Technology Drive	Malvern, PA		—		191,114		—		2,018,620			234,922		1,974,811		2,209,734		812,215	1998	40 yrs.
45 Liberty Boulevard	Malvern, PA		—		4,380,221		—		15,314,868			4,749,748		14,945,341		19,695,089		5,592,198	1999	40 yrs.

56

								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
100 Chesterfield Parkway	Malvern, PA		—		1,320,625		—		6,714,624		1,451,139		6,584,110		8,035,249		2,703,488	1998	40 yrs.
600 Chesterfield Parkway	Malvern, PA		—		2,013,750		—		8,255,848		2,171,080		8,098,519		10,269,598		2,977,313	1999	40 yrs.
700 Chesterfield Parkway	Malvern, PA		—		2,013,750		—		8,216,674		2,158,337		8,072,087		10,230,424		2,945,440	1999	40 yrs.
18 Great Valley Parkway	Malvern, PA		—		394,036		3,976,221		99,539		397,293		4,072,504		4,469,796		1,029,148	1980	40 yrs.
11 Great Valley Parkway	Malvern, PA		—		496,297		—		3,226,924		708,331		3,014,890		3,723,221		810,169	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		6,188,393	1989	40 yrs.
2 West Liberty Boulevard	Malvern, PA		—		5,405,041		—		11,635,939		5,405,042		11,635,938		17,040,980		1,218,933	2003	40 yrs.
10 Great Valley Parkway	Malvern, PA		—		823,540		1,341,376		315,887		832,244		1,648,558		2,480,802		250,709	2003	40 yrs.
10, 20 Liberty Boulevard	Malvern, PA		—		724,058		—		5,760,414		724,846		5,759,626		6,484,472		2,818,957	1985	40 yrs.
420 Lapp Road	Malvern, PA		—		1,054,418		—		7,140,197		1,055,243		7,139,372		8,194,615		3,580,383	1989	40 yrs.
14 Lee Boulevard	Malvern, PA		—		664,282		—		6,022,257		643,892		6,042,647		6,686,539		3,107,281	1988	40 yrs.
500 Chesterfield Parkway	Malvern, PA		—		472,364		—		3,323,124		519,742		3,275,746		3,795,488		1,804,871	1988	40 yrs.
300-400 Chesterfield Parkway	Malvern, PA		—		937,212		—		5,742,100		1,012,843		5,666,469		6,679,312		2,967,422	1988	40 yrs.
40 Valley Stream Parkway	Malvern, PA		—		322,918		—		3,282,210		325,775		3,279,352		3,605,128		1,678,712	1987	40 yrs.
50 Valley Stream Parkway	Malvern, PA		—		323,971		—		3,204,468		323,792		3,204,647		3,528,439		1,436,712	1987	40 yrs.
20 Valley Stream Parkway	Malvern, PA		—		465,539		—		5,835,528		466,413		5,834,654		6,301,067		3,318,987	1987	40 yrs.
257-275 Great Valley Parkway	Malvern, PA		—		504,611		—		5,192,928		505,458		5,192,081		5,697,539		3,345,868	1983	40 yrs.
300 Technology Drive	Malvern, PA		—		368,626		—		1,344,816		374,497		1,338,945		1,713,442		769,673	1985	40 yrs.
277-293 Great Valley Parkway	Malvern, PA		—		530,729		—		2,452,813		531,534		2,452,008		2,983,542		1,480,904	1984	40 yrs.
311 Technology Drive	Malvern, PA		—		397,131		—		2,911,205		397,948		2,910,388		3,308,336		1,616,977	1984	40 yrs.
7 Great Valley Parkway	Malvern, PA		—		176,435		—		5,105,230		177,317		5,104,349		5,281,665		3,183,485	1985	40 yrs.
55 Valley Stream Parkway	Malvern, PA		—		215,005		—		4,393,160		215,818		4,392,348		4,608,165		2,300,673	1983	40 yrs.
65 Valley Stream Parkway	Malvern, PA		—		381,544		—		7,203,727		382,361		7,202,910		7,585,271		4,415,881	1983	40 yrs.
508 Lapp Road	Malvern, PA		—		331,392		—		2,021,104		332,216		2,020,280		2,352,496		1,333,384	1984	40 yrs.
10 Valley Stream Parkway	Malvern, PA		—		509,075		—		3,142,498		509,899		3,141,674		3,651,573		1,876,084	1984	40 yrs.
333 Phoenixville Pike	Malvern, PA		—		523,530		—		3,109,124		524,230		3,108,424		3,632,654		1,735,696	1985	40 yrs.
30 Great Valley Parkway	Malvern, PA		—		128,126		—		385,634		128,783		384,977		513,760		330,693	1975	40 yrs.
77-123 Great Valley Parkway	Malvern, PA		—		887,664		—		5,989,734		888,359		5,989,039		6,877,398		3,817,572	1978	40 yrs.
205 Great Valley Parkway	Malvern, PA		—		1,368,259		—		10,951,703		1,369,003		10,950,959		12,319,962		7,311,132	1981	40 yrs.
12,14,16 Great Valley Parkway	Malvern, PA		—		130,689		—		1,560,924		128,767		1,562,846		1,691,613		1,010,537	1982	40 yrs.
155 Great Valley Parkway	Malvern, PA		—		625,147		—		2,627,280		626,068		2,626,359		3,252,427		1,682,215	1981	40 yrs.
510 Lapp Road	Malvern, PA		—		356,950		—		926,587		357,751		925,786		1,283,537		615,963	1983	40 yrs.
60 Morehall Road	Malvern, PA		—		865,424		9,285,000		5,003,181		884,974		14,268,631		15,153,605		7,616,738	1989	40 yrs.
5 Country View Road	Malvern, PA		—		785,168		4,678,632		1,056,753		786,235		5,734,318		6,520,553		2,238,508	1985	40 yrs.
75 Great Valley Parkway	Malvern, PA		233,819		143,074		—		888,076		143,811		887,338		1,031,150		639,417	1977	40 yrs.
7550 Meridian Circle	Maple Grove, MN		—		513,250		2,901,906		480,768		513,250		3,382,673		3,895,923		924,902	1989	40 yrs.
701A Route 73 South	Marlton, NJ		—		264,387		3,772,000		4,136,671		271,743		7,901,315		8,173,058		3,869,216	1987	40 yrs.
701C Route 73 South	Marlton, NJ		—		84,949		1,328,000		630,335		96,161		1,947,123		2,043,284		787,244	1987	40 yrs.
400 Lippincott Drive	Marlton, NJ		—		69,402				3,794,883		317,799		3,546,486		3,864,285		1,160,762	1999	40 yrs.
406 Lippincott Drive	Marlton, NJ		—		321,455		1,539,871		1,152,052		327,554		2,685,824		3,013,378		1,208,728	1990	40 yrs.
301 Lippincott Drive	Marlton, NJ		—		1,069,837		4,780,163		1,627,277		1,069,838		6,407,440		7,477,277		2,579,480	1988	40 yrs.
303 Lippincott Drive	Marlton, NJ		—		1,069,837		4,780,163		3,061,402		1,069,838		7,841,565		8,911,402		3,095,840	1988	40 yrs.
901 Route 73	Marlton, NJ		—		334,411		2,733,314		822,958		334,411		3,556,271		3,890,683		1,303,790	1985	40 yrs.
404 Lippincott Drive	Marlton, NJ		—		131,896		—		1,809,487		131,896		1,809,487		1,941,383		732,345	1997	40 yrs.
402 Lippincott Drive	Marlton, NJ		—		131,896		—		2,096,558		131,896		2,096,558		2,228,454		785,592	1997	40 yrs.
75 Brookfield Oaks Drive	Mauldin, SC		—		419,731		—		2,476,356		430,909		2,465,178		2,896,087		276,134	2003	40 yrs.
65 Brookfield Oaks Drive	Mauldin, SC		—		557,174		—		2,745,259		506,318		2,796,116		3,302,434		273,241	2004	40 yrs.
7800 N. 113th Street	Milwaukee, WI		—		1,711,964		6,847,857		417,823		1,711,964		7,265,680		8,977,644		2,144,918	1991	40 yrs.
11950 W. Lake Park Drive	Milwaukee, WI		—		391,813		2,340,118		597,682		394,938		2,934,675		3,329,613		962,505	1986	40 yrs.
11400 W. Lake Park Drive	Milwaukee, WI		—		439,595		2,357,904		352,646		443,101		2,707,044		3,150,145		678,300	1986	40 yrs.
11425 W. Lake Park Drive	Milwaukee, WI		—		382,256		2,350,619		978,198		385,305		3,325,768		3,711,073		1,301,393	1987	40 yrs.
11301 W. Lake Park Drive	Milwaukee, WI		—		614,477		2,626,456		123,888		619,465		2,745,357		3,364,821		679,473	1987	40 yrs.
11900 W. Lake Park Drive	Milwaukee, WI		—		347,853		2,396,887		1,077,279		350,628		3,471,392		3,822,020		1,219,789	1987	40 yrs.
11414 West Park Place	Milwaukee, WI		—		234,443				10,745,623		491,531		10,488,536		10,980,067		3,129,496	2001	40 yrs.
11520 West Calumet Road	Milwaukee, WI		—		341,698		1,527,548		78,494		341,698		1,606,042		1,947,740		372,203	1995	40 yrs.
12100 West Park Place	Milwaukee, WI		—		534,470		3,239,389		572,084		532,370		3,813,573		4,345,943		1,107,320	1984	40 yrs.
11100 West Liberty Drive	Milwaukee, WI		—		1,800,000				7,537,760		1,801,024		7,536,736		9,337,760		1,330,833	2003	40 yrs.
11050 West Liberty Drive	Milwaukee, WI		—		—		—		3,816,745		914,760		2,901,985		3,816,745		175,374	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		2,049,711	1996	40 yrs.
4600 Nathan Lane	Minneapolis, MN		—		1,063,558				6,683,083		1,038,197		6,708,444		7,746,641		2,184,719	2002	40 yrs.
12501 & 12701 Whitewater Drive	Minnegonka, MN		—		2,175,209		3,948,085		7,480,997		2,177,953		11,426,338		13,604,291		1,523,808	1986	40 yrs.
5600 & 5610 Rowland Road	Minnetonka, MN		—		828,650		7,399,409		2,154,498		829,263		9,553,293		10,382,557		3,528,882	1988	40 yrs.
5400-5500 Feltl Road	Minnetonka, MN		—		883,895		7,983,345		2,288,449		883,895		10,271,794		11,155,689		3,272,429	1985	40 yrs.
3400 Lakeside Drive	Miramar, FL		—		2,022,153		11,345,881		1,661,289		2,022,153		13,007,169		15,029,323		3,866,622	1990	40 yrs.
3450 Lakeside Drive	Miramar, FL		—		2,022,152		11,357,143		2,623,700		2,022,152		13,980,843		16,002,994		4,453,379	1990	40 yrs.
3350 SW 148th Avenue	Miramar, FL		—		2,960,511		—		19,988,526		2,980,689		19,968,347		22,949,037		5,995,017	2000	40 yrs.
324 Park Knoll Drive	Morrisville, NC		*		1,449,092		4,424,932		239,301		1,449,450		4,663,875		6,113,325		221,707	2007	40 yrs.
619 Distribution Drive	Morrisville, NC		*		1,031,430		5,655,167		406,756		1,031,685		6,061,668		7,093,353		273,517	2007	40 yrs.
627 Distribution Drive	Morrisville, NC		*		1,061,370		5,152,110		231,852		1,061,632		5,383,700		6,445,332		226,746	2007	40 yrs.
701 Distribution Drive	Morrisville, NC		*		1,300,889		5,313,226		206,727		1,301,211		5,519,632		6,820,842		230,736	2007	40 yrs.
330 Fellowship Road	Mount Laurel, NJ		—		3,730,570		—		15,782,675		3,758,270		15,754,975		19,513,245		118,386	2006	40 yrs.
300 Fellowship Road	Mt Laurel, NJ		—		—		—		7,350,519		1,098,904		6,251,616		7,350,519		838,722	2004	40 yrs.
302 Fellowship Road	Mt Laurel, NJ		—		1,512,120		—		2,931,388		539,060		3,904,448		4,443,507		356,761	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		1,731,986	2003	40 yrs.
350 Fellowship Road	Mt Laurel, NJ		—		2,960,159		1,449,611		4,555,353		2,970,687		5,994,436		8,965,123		397,053	2006	40 yrs.
4001 Leadenhall Road	Mt. Laurel, NJ		—		3,207,885		391,167		18,894,592		2,784,694		19,708,950		22,493,644		4,148,410	2002	40 yrs.

57

									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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
3000 Atrium Way	Mt. Laurel, NJ		—		500,000		4,500,000			5,049,174		512,018		9,537,156		10,049,174		4,500,007	1987	40 yrs.
11000, 15000 Commerce Parkway	Mt. Laurel, NJ		—		310,585		4,394,900			622,498		311,950		5,016,033		5,327,983		2,405,135	1985	40 yrs.
12000, 14000 Commerce Parkway	Mt. Laurel, NJ		—		361,800		3,285,817			968,639		362,855		4,253,401		4,616,256		1,746,377	1985	40 yrs.
16000, 18000 Commerce Parkway	Mt. Laurel, NJ		—		289,700		2,512,683			1,335,052		290,545		3,846,890		4,137,435		1,379,385	1985	40 yrs.
1300 Route 73 North	Mt. Laurel, NJ		—		449,400		3,074,850			2,152,136		450,558		5,225,828		5,676,386		1,991,748	1988	40 yrs.
6000 Commerce Parkway	Mt. Laurel, NJ		—		234,151		2,022,683			902,135		234,151		2,924,818		3,158,969		1,102,498	1985	40 yrs.
7000 Commerce Parkway	Mt. Laurel, NJ		—		260,014		2,236,684			428,261		260,014		2,664,945		2,924,959		947,137	1984	40 yrs.
8000 Commerce Parkway	Mt. Laurel, NJ		—		234,814		1,995,098			468,864		234,814		2,463,962		2,698,776		726,982	1983	40 yrs.
9000 Commerce Parkway	Mt. Laurel, NJ		—		286,587		2,474,820			999,069		286,587		3,473,888		3,760,476		1,235,450	1983	40 yrs.
1000 Briggs Road	Mt. Laurel, NJ		—		288,577		2,546,537			1,481,895		288,577		4,028,432		4,317,009		1,762,710	1986	40 yrs.
1020 Briggs Road	Mt. Laurel, NJ		—		494,334		—			3,166,630		569,184		3,091,781		3,660,964		1,022,257	1999	40 yrs.
2000 Crawford Place	Mt. Laurel, NJ		—		310,831		2,797,744			2,918,905		310,831		5,716,649		6,027,480		2,538,858	1986	40 yrs.
5000 Dearborn Court	Mt. Laurel, NJ		—		1,057,763		4,191,827			1,651,610		1,057,763		5,843,437		6,901,200		1,628,440	1988	40 yrs.
1001 Briggs Road	Mt. Laurel, NJ		—		701,705		3,505,652			2,139,294		701,705		5,644,946		6,346,652		2,407,293	1986	40 yrs.
1015 Briggs Road	Mt. Laurel, NJ		—		356,987		—			3,673,175		470,659		3,559,503		4,030,162		1,075,140	2000	40 yrs.
17000 Commerce Parkway	Mt. Laurel, NJ		—		144,515					3,457,069		144,515		3,457,069		3,601,584		962,620	2001	40 yrs.
1025 Briggs Road	Mt. Laurel, NJ		278,931		430,990		3,714,828			1,234,492		430,990		4,949,320		5,380,310		1,830,207	1987	40 yrs.
6 Terry Drive	Newtown, PA		—		622,029		2,228,851			1,023,137		622,205		3,251,811		3,874,016		1,175,053	1981	40 yrs.
550-590 Hale Avenue	Oakdale, MN		—		765,535		3,488,754			666,032		766,390		4,153,931		4,920,320		1,174,506	1996	40 yrs.
1879 Lamont Avenue	Odenton, MD		—		1,976,000		8,099,579			2,469,160		2,011,030		10,533,709		12,544,739		1,157,212	2004	40 yrs.
350 Winmeyer Avenue	Odenton, MD		—		1,778,400		7,289,165			1,867,935		1,809,927		9,125,573		10,935,500		958,092	2004	40 yrs.
9600 Satellite Boulevard	Orlando, FL		—		252,850		1,297,923			62,116		252,850		1,360,039		1,612,889		410,096	1989	40 yrs.
9700 Satellite Boulevard	Orlando, FL		—		405,362		1,146,546			350,999		405,362		1,497,545		1,902,907		472,552	1989	40 yrs.
1902 Cypress Lake Drive	Orlando, FL		—		523,512		3,191,790			1,027,641		538,512		4,204,431		4,742,943		1,349,433	1989	40 yrs.
9550 Satellite Boulevard	Orlando, FL		—		574,831		—	��		2,330,526		587,319		2,318,038		2,905,357		716,478	1999	40 yrs.
10511 & 10611 Satellite Boulevard	Orlando, FL		—		517,554		2,568,186			487,613		522,991		3,050,362		3,573,353		1,013,101	1985	40 yrs.
1400-1440 Central Florida Parkway	Orlando, FL		—		518,043		2,561,938			862,155		518,043		3,424,093		3,942,136		918,802	1962	40 yrs.
2216 Directors Row	Orlando, FL		—		453,918		2,572,202			30,979		453,918		2,603,181		3,057,099		686,270	1998	40 yrs.
2400 South Lake Orange Drive	Orlando, FL		—		385,964		—			2,409,102		642,427		2,152,639		2,795,066		498,346	2001	40 yrs.
6923 Lee Vista Boulevard	Orlando, FL		—		903,701		—			3,790,657		830,953		3,863,405		4,694,358		218,655	2006	40 yrs.
6501 Lee Vista Boulevard	Orlando, FL		—		903,701					5,560,142		925,671		5,538,172		6,463,843		1,024,755	2001	40 yrs.
2416 Lake Orange Drive	Orlando, FL		—		535,964					3,175,219		704,800		3,006,382		3,711,182		951,877	2002	40 yrs.
10771 Palm Bay Drive	Orlando, FL		—		664,605					2,362,814		685,383		2,342,035		3,027,419		416,722	2001	40 yrs.
10003 Satellite Boulevard	Orlando, FL		—		680,312		2,120,754			1,241,828		680,312		3,362,582		4,042,894		662,327	2003	40 yrs.
1090 Gills Drive	Orlando, FL		—		878,320		2,558,833			1,371,034		878,320		3,929,867		4,808,187		529,509	2003	40 yrs.
2202 Taft-Vineland Road	Orlando, FL		—		—		—			6,631,110		1,283,713		5,347,397		6,631,110		1,072,811	2004	40 yrs.
South Center Land-Phase II	Orlando, FL		—		838,853		—			4,084,539		767,953		4,155,440		4,923,392		298,526	2006	40 yrs.
7315 Kingspointe Parkway	Orlando, FL		—		1,931,697		6,388,203			2,135,046		1,932,004		8,522,943		10,454,946		1,287,196	2004	40 yrs.
2351 Investors Row	Orlando, FL		—		2,261,924		7,496,249			411,516		2,263,211		7,906,478		10,169,689		790,763	2004	40 yrs.
1950 Summit Park Drive	Orlando, FL		—		2,573,700		17,478,646			587,603		2,583,667		18,056,282		20,639,949		1,772,310	2005	40 yrs.
1958 Summit Park Drive	Orlando, FL		—		2,573,961		11,206,937			8,841,420		2,583,216		20,039,102		22,622,318		2,031,969	2005	40 yrs.
6200 Lee Vista Boulevard	Orlando, FL		—		1,423,584		6,399,510			65,322		1,435,301		6,453,115		7,888,416		543,837	2006	40 yrs.
7022 TPC Drive	Orlando, FL		—		1,443,510		6,845,559			572,022		1,457,286		7,403,806		8,861,092		625,097	2006	40 yrs.
7100 TPC Drive	Orlando, FL		—		1,431,489		7,948,341			576,378		1,445,807		8,510,400		9,956,207		576,967	2006	40 yrs.
7101 TPC Drive	Orlando, FL		—		1,553,537		5,301,499			777,653		1,570,863		6,061,826		7,632,689		436,743	2006	40 yrs.
851 Gills Drive	Orlando, FL		—		332,992		—			2,559,105		373,500		2,518,597		2,892,097		28,215	2006	40 yrs.
950 Gills Drive	Orlando, FL		—		443,989		—			2,496,959		464,800		2,476,148		2,940,948		28,432	2006	40 yrs.
1000 Gills Drive	Orlando, FL		—		415,906		—			2,700,326		435,400		2,680,832		3,116,232		36,577	2006	40 yrs.
8751 Skinner Court	Orlando, FL		—		1,009,532		—			5,452,988		1,075,437		5,387,083		6,462,520		50,479	2008	40 yrs.
2256 Taft-Vineland Road	Orlando, FL		—		467,296		—			2,494,666		825,673		2,136,290		2,961,963		237,098	2005	40 yrs.
8801 Tinicum Boulevard	Philadelphia, PA		—		2,474,031		—			43,598,952		125,087		45,947,896		46,072,983		15,252,548	1997	40 yrs.
3 Franklin Plaza	Philadelphia, PA		—		2,483,144		—			32,150,134		2,514,519		32,118,759		34,633,278		7,807,092	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		989,840	2003	40 yrs.
1 Crescent Drive	Philadelphia, PA		—		567,280		—			14,379,278		347,892		14,598,666		14,946,558		917,104	2004	40 yrs.
4775 League Island Boulevard	Philadelphia, PA		—		891,892		—			5,757,514		366,982		6,282,425		6,649,406		176,510	2006	40 yrs.
4410 E. Cotton Center Boulevard	Phoenix, AZ		—		4,758,484		10,559,563			4,222,270		4,765,172		14,775,144		19,540,317		224,278	2007	40 yrs.
4750 S. 44th Place	Phoenix, AZ		—		3,756,307		8,336,400			3,624,432		3,761,587		11,955,552		15,717,139		175,068	2007	40 yrs.
4435 E. Cotton Center Boulevard	Phoenix, AZ		—		1,910,584		1,954,020			2,167,338		1,911,045		4,120,898		6,031,943		127,251	2007	40 yrs.
4207 E. Cotton Center Boulevard	Phoenix, AZ		—		1,409,908		4,680,808			1,096,836		1,410,248		5,777,305		7,187,552		415,229	2007	40 yrs.
4217 E. Cotton Center Boulevard	Phoenix, AZ		—		4,831,925		10,045,599			2,015,623		4,833,088		12,060,059		16,893,147		598,710	2007	40 yrs.
4425 E. Cotton Center Boulvard	Phoenix, AZ		*		7,318,457		24,549,401			28,556		7,318,457		24,577,957		31,896,413		1,212,322	2007	40 yrs.
4415 E. Cotton Center Boulevard	Phoenix, AZ		*		1,749,957		3,767,213			6,137		1,749,957		3,773,350		5,523,308		260,492	2007	40 yrs.
4405 E. Cotton Center Boulevard	Phoenix, AZ		*		2,646,318		9,697,439			9,441		2,646,318		9,706,880		12,353,198		442,023	2007	40 yrs.
4313 E. Cotton Center Boulevard	Phoenix, AZ		*		3,895,539		16,724,283			1,399,749		3,895,539		18,124,032		22,019,571		913,104	2007	40 yrs.
4303 E. Cotton Center Boulvard	Phoenix, AZ		*		2,619,964		9,675,711			11,076		2,619,964		9,686,787		12,306,751		485,652	2007	40 yrs.
9801 80th Avenue	Pleasant Prairie, WI		—		1,692,077		7,934,794			337,495		1,689,726		8,274,640		9,964,366		2,019,026	1994	40 yrs.
2250 Hickory Road	Plymouth Meeting, PA		—		1,015,851		9,175,555			2,985,528		1,032,507		12,144,428		13,176,935		3,779,952	1985	40 yrs.
2905 Northwest Boulevard	Plymouth, MN		—		516,920		4,646,342			1,932,535		516,920		6,578,877		7,095,797		2,540,236	1983	40 yrs.
2800 Campus Drive	Plymouth, MN		—		395,366		3,554,512			1,165,443		395,366		4,719,955		5,115,321		1,724,869	1985	40 yrs.
2955 Xenium Lane	Plymouth, MN		—		151,238		1,370,140			508,272		151,238		1,878,412		2,029,650		739,900	1985	40 yrs.
2920 Northwest Boulevard	Plymouth, MN		—		392,026		3,433,678			661,796		384,235		4,103,265		4,487,500		1,329,439	1997	40 yrs.
14630-14650 28th Avenue North	Plymouth, MN		—		198,205		1,793,422			782,928		198,205		2,576,350		2,774,555		890,678	1978	40 yrs.
2800 Northwest Boulevard	Plymouth, MN		—		1,934,438		10,952,503			536,220		1,934,438		11,488,723		13,423,161		3,263,618	1995	40 yrs.
9600 54th Avenue	Plymouth, MN		—		332,317		3,077,820			1,020,792		332,317		4,098,612		4,430,929		1,432,032	1998	40 yrs.
1500 SW 5th Court	Pompano Beach, FL		—		972,232		3,892,085			404,585		972,232		4,296,671		5,268,902		1,230,523	1957	40 yrs.
1651 SW 5th Court	Pompano Beach, FL		—		203,247		811,093			129,136		203,247		940,230		1,143,477		336,929	1990	40 yrs.

58

								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
1601 SW 5th Court	Pompano Beach, FL		—		203,247		811,093		402,780			203,247		1,213,873		1,417,120		427,797	1990	40 yrs.
1501 SW 5th Court	Pompano Beach, FL		—		203,247		811,093		34,991			203,247		846,085		1,049,332		246,654	1990	40 yrs.
1400 SW 6th Court	Pompano Beach, FL		—		1,157,049		4,620,956		422,912			1,157,049		5,043,868		6,200,917		1,436,541	1986	40 yrs.
1405 SW 6th Court	Pompano Beach, FL		—		392,138		1,565,787		206,898			392,138		1,772,685		2,164,823		519,497	1985	40 yrs.
595 SW 13th Terrace	Pompano Beach, FL		—		359,933		1,437,116		195,253			359,933		1,632,369		1,992,302		453,566	1984	40 yrs.
601 SW 13th Terrace	Pompano Beach, FL		—		164,413		655,933		119,530			164,413		775,463		939,875		280,108	1984	40 yrs.
605 SW 16th Terrace	Pompano Beach, FL		—		310,778		1,238,324		275,029			310,178		1,513,953		1,824,131		442,398	1965	40 yrs.
4300 Carolina Avenue	Richmond, VA		—		2,007,717		14,927,608		496,232			2,009,136		15,422,421		17,431,557		5,304,579	1985	40 yrs.
301 Hill Carter Parkway	Richmond, VA		—		659,456		4,836,010		93,935			659,456		4,929,945		5,589,401		1,673,276	1989	40 yrs.
5600-5626 Eastport Boulevard	Richmond, VA		—		489,941		3,592,900		335,023			489,941		3,927,923		4,417,864		1,439,202	1989	40 yrs.
5650-5674 Eastport Boulevard	Richmond, VA		—		644,384		4,025,480		244,746			644,384		4,270,226		4,914,610		1,618,808	1990	40 yrs.
5700 Eastport Boulevard	Richmond, VA		—		408,729		2,697,348		818,887			408,729		3,516,235		3,924,964		1,291,932	1990	40 yrs.
4101-4127 Carolina Avenue	Richmond, VA		—		310,854		2,279,597		578,738			310,854		2,858,335		3,169,189		965,450	1973	40 yrs.
4201-4261 Carolina Avenue	Richmond, VA		—		693,203		5,083,493		1,669,869			693,203		6,753,362		7,446,565		2,303,775	1975	40 yrs.
4263-4299 Carolina Avenue	Richmond, VA		—		256,203		2,549,649		1,968,381			256,203		4,518,030		4,774,233		1,452,966	1976	40 yrs.
4301-4335 Carolina Avenue	Richmond, VA		—		223,696		1,640,435		2,672,043			223,696		4,312,478		4,536,174		905,854	1978	40 yrs.
4337-4379 Carolina Avenue	Richmond, VA		—		325,303		2,385,557		1,627,330			325,303		4,012,887		4,338,190		1,560,157	1979	40 yrs.
4501-4549 Carolina Avenue	Richmond, VA		—		486,166		3,565,211		410,129			486,166		3,975,340		4,461,506		1,405,245	1981	40 yrs.
4551-4593 Carolina Avenue	Richmond, VA		—		474,360		3,478,646		759,624			474,360		4,238,270		4,712,630		1,362,082	1982	40 yrs.
4601-4643 Carolina Avenue	Richmond, VA		—		652,455		4,784,675		622,565			652,455		5,407,240		6,059,695		2,062,630	1985	40 yrs.
4645-4683 Carolina Avenue	Richmond, VA		—		404,616		2,967,187		1,247,671			404,616		4,214,858		4,619,474		1,942,146	1985	40 yrs.
4447-4491 Carolina Avenue	Richmond, VA		—		454,056		2,729,742		293,897			454,056		3,023,639		3,477,695		1,133,376	1987	40 yrs.
4401-4445 Carolina Avenue	Richmond, VA		—		615,038		4,510,272		397,983			615,038		4,908,255		5,523,293		1,728,465	1988	40 yrs.
2300 East Parham Road	Richmond, VA		—		221,947		1,011,088		2,443			221,947		1,013,531		1,235,478		393,834	1988	40 yrs.
5601-5659 Eastport Boulevard	Richmond, VA		—		705,660		—		4,880,177			720,100		4,865,737		5,585,837		1,927,568	1996	40 yrs.
5900 Eastport Boulevard	Richmond, VA		—		676,661		—		4,822,772			687,898		4,811,535		5,499,433		1,547,220	1997	40 yrs.
4717-4729 Eubank Road	Richmond, VA		—		449,447		3,294,697		746,131			452,263		4,038,011		4,490,274		1,555,342	1978	40 yrs.
4263F-N. Carolina Avenue	Richmond, VA		—		91,476		—		1,652,274			91,599		1,652,151		1,743,750		532,286	1975	40 yrs.
510 Eastpark Court	Richmond, VA		—		261,961		2,110,874		485,076			262,210		2,595,701		2,857,911		929,172	1989	40 yrs.
520 Eastpark Court	Richmond, VA		—		486,118		4,083,582		397,629			486,598		4,480,731		4,967,329		1,472,083	1989	40 yrs.
5701-5799 Eastport Boulevard	Richmond, VA		—		694,644		—		5,851,949			700,503		5,846,090		6,546,593		1,958,624	1998	40 yrs.
530 Eastpark Court	Richmond, VA		—		266,883		—		3,132,390			334,772		3,064,501		3,399,273		1,276,640	1999	40 yrs.
6000 Eastport Blvd	Richmond, VA		—		872,901		—		7,486,746			901,666		7,457,981		8,359,647		132,485	1997	40 yrs.
3829-3855 Gaskins Road	Richmond, VA		—		364,165		3,264,114		39,764			364,165		3,303,879		3,668,044		896,060	1988	40 yrs.
10800 Nuckols Boulevard	Richmond, VA		—		1,432,462		—		14,420,839			1,794,162		14,059,139		15,853,301		3,132,138	2000	40 yrs.
100 Westgate Parkway	Richmond, VA		—		1,140,648		101,824		8,411,249			1,456,084		8,197,637		9,653,721		1,688,941	2001	40 yrs.
200 Westgate Parkway	Richmond, VA		—		1,623,612				6,030,738			1,072,797		6,581,554		7,654,350		1,369,827	2002	40 yrs.
3900 Westerre Parkway	Richmond, VA		—		392,184		—		11,788,193			1,100,000		11,080,377		12,180,377		733,032	2005	40 yrs.
1001 Boulders Parkway	Richmond, VA		—		2,073,739		5,634,796		1,606,286			2,079,643		7,235,178		9,314,821		772,257	2005	40 yrs.
7400 Beaufont Springs Drive	Richmond, VA		—		808,581		7,273,850		1,076,495			810,743		8,348,182		9,158,925		849,550	2005	40 yrs.
1100 Boulders Parkway	Richmond, VA		—		1,276,936		12,052,192		1,391,680			1,280,662		13,440,146		14,720,808		1,107,762	2005	40 yrs.
2020 US Highway 301 South	Riverview, FL		—		1,233,639		13,608,485		109,898			1,233,800		13,718,223		14,952,022		929,938	2006	40 yrs.
6532 Judge Adams Road	Rock Creek, NC		—		354,903		—		3,694,306			399,988		3,649,221		4,049,209		1,182,063	1997	40 yrs.
6530 Judge Adams Road	Rock Creek, NC		—		305,821		—		4,808,367			335,061		4,779,126		5,114,187		1,133,828	1999	40 yrs.
6509 Franz Warner Parkway	Rock Creek, NC		—		360,494				2,829,679			372,494		2,817,679		3,190,173		703,751	2001	40 yrs.
8501 East Raintree Drive	Scottsdale, AZ		—		4,076,412		—		27,621,159			4,115,137		27,582,434		31,697,571		2,337,940	2005	40 yrs.
Renaissance Blvd & Hwy 20	Sturtevant, WI		—		2,484,450		—		21,261,491			2,487,293		21,258,647		23,745,940		896,554	2006	40 yrs.
6950 Harbor View Blvd	Suffolk, VA		—		929,844		—		6,209,197			794,848		6,344,194		7,139,041		531,978	2004	40 yrs.
6900 Harbor View Boulevard	Suffolk, VA		—		904,052		—		8,372,235			807,006		8,469,281		9,276,287		293,059	2006	40 yrs.
13650 NW 8th Street	Sunrise, FL		—		558,223		2,171,930		106,552			558,251		2,278,454		2,836,705		703,684	1991	40 yrs.
13630 NW 8th Street	Sunrise, FL		—		659,797		2,596,275		772,671			659,825		3,368,917		4,028,742		1,244,345	1991	40 yrs.
1301 International Parkway	Sunrise, FL		—		5,100,162		24,219,956		7,393,483			5,100,791		31,612,809		36,713,600		1,335,884	2006	40 yrs.
13621 NW 12th Street	Sunrise, FL		—		5,570,820		16,794,539		(6,363,816	)		5,570,820		10,430,723		16,001,543		519,716	2008	40 yrs.
5501-5519 Pioneer Park Boulevard	Tampa, FL		—		162,000		1,613,000		979,607			262,416		2,492,191		2,754,607		774,174	1981	40 yrs.
5690-5694 Crenshaw Street	Tampa, FL		—		181,923		1,812,496		217,470			181,923		2,029,967		2,211,890		697,188	1979	40 yrs.
3102,3104,3110 Cherry Palm Drive	Tampa, FL		—		503,767		2,787,585		1,665,018			503,767		4,452,603		4,956,370		1,853,673	1986	40 yrs.
8401-8408 Benjamin Road	Tampa, FL		—		789,651		4,454,648		2,424,302			769,789		6,898,812		7,668,601		2,731,317	1986	40 yrs.
111 Kelsey Lane	Tampa, FL		—		359,540		1,461,850		660,118			359,540		2,121,968		2,481,508		865,380	1990	40 yrs.
131 Kelsey Lane	Tampa, FL		—		511,463		—		5,348,191			559,527		5,300,127		5,859,654		2,096,018	1985	40 yrs.
7724 Woodland Center Boulevard	Tampa, FL		—		235,893		—		2,344,137			235,894		2,344,136		2,580,030		808,901	1998	40 yrs.
7802-50 Woodland Center Boulevard	Tampa, FL		—		357,364		—		2,820,324			506,949		2,670,740		3,177,688		1,185,581	1999	40 yrs.
7852-98 Woodland Center Boulevard	Tampa, FL		—		357,364		—		2,831,556			506,949		2,681,971		3,188,920		1,157,792	1999	40 yrs.
8921 Brittany Way	Tampa, FL		—		224,369		1,063,882		972,276			254,493		2,006,034		2,260,527		564,527	1998	40 yrs.
5250 Eagle Trail Drive	Tampa, FL		—		952,860		—		3,671,277			952,860		3,671,277		4,624,137		1,016,975	1998	40 yrs.
7725 Woodland Center Boulevard	Tampa, FL		—		553,335		—		3,247,449			771,501		3,029,283		3,800,784		753,608	1999	40 yrs.
8001 Woodland Center Boulevard	Tampa, FL		—		350,406		—		2,454,389			438,061		2,366,735		2,804,796		711,284	1999	40 yrs.
4630 Woodland Corporate Boulevard	Tampa, FL		—		943,169		—		12,427,823			1,560,099		11,810,893		13,370,992		2,833,709	2000	40 yrs.
701-725 South US Hwy 301	Tampa, FL		—		419,683		—		3,840,421			661,680		3,598,424		4,260,104		1,365,997	2000	40 yrs.
4502 Woodland Corporate Boulevard	Tampa, FL		—		—		—		4,018,360			1,071,535		2,946,825		4,018,360		675,199	1999	40 yrs.
9001-9015 Brittany Way	Tampa, FL		—		209,841		—		1,877,914			364,514		1,723,242		2,087,756		444,426	2000	40 yrs.
4508 Woodland Corporate Boulevard	Tampa, FL		—		498,598		—		3,258,452			556,887		3,200,163		3,757,050		762,367	2000	40 yrs.
7622 Bald Cypress Place	Tampa, FL		—		—		—		1,305,584			300,000		1,005,584		1,305,584		225,053	2000	40 yrs.
901-933 US Highway 301 South	Tampa, FL		—		500,391				4,041,019			840,314		3,701,097		4,541,411		1,209,118	2001	40 yrs.
4503 Woodland Corporate Boulevard	Tampa, FL		—		—				3,454,328			619,913		2,834,415		3,454,328		580,188	2002	40 yrs.
4505 Woodland Corporate Boulevard	Tampa, FL		—		—				3,361,805			716,594		2,645,211		3,361,805		790,285	2002	40 yrs.
4511 Woodland Corporate Boulevard	Tampa, FL		—		—				2,840,466			686,594		2,153,872		2,840,466		516,379	2002	40 yrs.

59

								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		12/31/2008		12/31/08			Acquisition	(years)
OPERATING PROPERTIES
7621 Bald Cypress Place (Bldg N)	Tampa, FL		—		—		—		1,482,613		447,498		1,035,115		1,482,613		184,387		2001	40 yrs.
4520 Seedling Circle	Tampa, FL		—		854,797		42,131		2,721,233		854,797		2,763,364		3,618,161		324,144		2003	40 yrs.
501 US Highway 301 South	Tampa, FL		—		898,884		—		3,498,107		900,508		3,496,483		4,396,991		601,264		2004	40 yrs.
9002-9036 Brittany Way	Tampa, FL		—		492,320		—		3,964,055		899,284		3,557,092		4,456,375		898,192		2004	40 yrs.
8900-34 Brittany Was	Tampa, FL		—		537,194		—		4,267,109		978,019		3,826,284		4,804,303		641,478		2005	40 yrs.
200-34 Kelsey Lane	Tampa, FL		—		330,097		—		3,670,597		933,362		3,067,332		4,000,694		545,939		2005	40 yrs.
910-926 Chad Lane	Tampa, FL		—		201,771		—		3,214,736		628,237		2,788,270		3,416,507		268,040		2006	40 yrs.
150-182 Kelsey Lane	Tampa, FL		—		403,541		—		5,545,972		1,181,609		4,767,905		5,949,513		547,200		2006	40 yrs.
8725 Henderson Road	Tampa, FL		—		3,167,787		19,126,318		77,765		3,167,958		19,203,913		22,371,871		1,748,139		2006	40 yrs.
8735 Henderson Road	Tampa, FL		—		3,166,130		18,735,573		901,647		3,166,300		19,637,050		22,803,350		1,772,264		2006	40 yrs.
8705 Henderson Road	Tampa, FL		—		4,303,870		23,688,409		540,212		4,304,102		24,228,389		28,532,491		2,826,951		2006	40 yrs.
8715 Henderson Road	Tampa, FL		—		3,343,910		18,325,599		165,447		3,344,090		18,490,866		21,834,956		1,449,600		2006	40 yrs.
8745 Henderson Road	Tampa, FL		—		2,050,439		11,173,008		369,184		2,050,548		11,542,083		13,592,631		1,060,574		2006	40 yrs.
7851-7861 Woodland Center Blvd	Tampa, FL		—		548,905		2,241,627		115,828		548,905		2,357,455		2,906,360		183,337		2006	40 yrs.
9306-24 East Broadway Avenue	Tampa, FL		—		450,440		—		3,305,840		486,004		3,270,276		3,756,280		50,077		2007	40 yrs.
7930, 8010-20 Woodland Center Boulevard	Tampa, FL		*		1,408,478		5,247,246		1,008,256		1,408,478		6,255,502		7,663,980		2,120,396		1990	40 yrs.
7920 Woodland Center Boulevard	Tampa, FL		*		1,082,648		2,445,444		23,564		1,082,648		2,469,008		3,551,656		721,718		1997	40 yrs.
8154-8198 Woodland Center Boulevard	Tampa, FL		*		399,088		2,868,834		474,519		399,088		3,343,353		3,742,441		1,186,541		1988	40 yrs.
8112-42 Woodland Center Boulevard	Tampa, FL		*		513,263		3,230,239		658,168		513,263		3,888,408		4,401,670		1,147,345		1995	40 yrs.
8212 Woodland Center Boulevard	Tampa, FL		*		820,882		2,322,720		14,210		820,882		2,336,931		3,157,813		680,703		1996	40 yrs.
8313 West Pierce Street	Tolleson, AZ		—		2,295,090		9,079,811		3,014,938		2,295,090		12,094,749		14,389,840		343,685		2007	40 yrs.
3701 Corporate Parkway	Upper Saucon, PA		—		1,078,674		—		9,823,105		901,968		9,999,811		10,901,779		629,464		2005	40 yrs.
2809 South Lynnhaven Road	Virginia Beach, VA		—		953,590		6,142,742		1,382,128		953,590		7,524,870		8,478,460		2,279,614		1987	40 yrs.
200 Golden Oak Court	Virginia Beach, VA		—		1,116,693		6,770,480		1,420,159		1,116,693		8,190,639		9,307,332		2,528,604		1988	40 yrs.
208 Golden Oak Court	Virginia Beach, VA		—		965,177		6,728,717		1,504,070		965,177		8,232,787		9,197,965		2,598,564		1989	40 yrs.
484 Viking Drive	Virginia Beach, VA		—		891,753		3,607,890		529,968		891,753		4,137,858		5,029,610		1,296,159		1987	40 yrs.
629 Phoenix Drive	Virginia Beach, VA		—		371,694		2,108,097		238,683		371,694		2,346,780		2,718,474		745,517		1996	40 yrs.
5700 Cleveland Street	Virginia Beach, VA		—		700,112		9,592,721		2,158,112		700,564		11,750,381		12,450,945		3,807,303		1989	40 yrs.
1457 Miller Store Road	Virginia Beach, VA		—		473,689		2,663,045		824,754		474,746		3,486,743		3,961,488		609,881		2003	40 yrs.
11020 West Plank Court	Wauwatosa, WI		—		464,246		2,681,255		49,877		464,246		2,731,132		3,195,378		683,120		1985	40 yrs.
825 Duportail Road	Wayne, PA		—		5,536,619		16,179,213		3,593,981		5,539,281		19,770,532		25,309,813		3,971,913		1979	40 yrs.
1500 Liberty Ridge	Wayne, PA		—		8,287,555				31,571,199		11,636,499		28,222,255		39,858,754		6,286,378		2002	40 yrs.
1200 Liberty Ridge Drive	Wayne, PA		—		6,215,667				8,762,512		5,223,660		9,754,519		14,978,179		3,122,508		2001	40 yrs.
11300-90 West Theodore Trecker Way	West Allis, WI		—		500,565		1,591,678		648,026		505,972		2,234,297		2,740,269		269,360		2005	40 yrs.
11548 West Theodore Trecker Way	West Allis, WI		—		660,068		4,640,578		87,815		663,766		4,724,696		5,388,462		418,716		2005	40 yrs.
11420 West Theodore Trecker Way	West Allis, WI		—		348,146		2,057,483		104,569		350,008		2,160,190		2,510,198		187,134		2005	40 yrs.
400-500 Brandywine Parkway	West Chester, PA		—		845,846		6,809,025		438,609		845,846		7,247,634		8,093,480		2,098,749		1988	40 yrs.
600 Brandywine Parkway	West Chester, PA		—		664,899		5,352,410		869,826		664,899		6,222,236		6,887,135		1,935,854		1988	40 yrs.
905 Airport Road	West Chester, PA		—		1,715,000		5,185,000		1,606,158		1,735,012		6,771,146		8,506,158		2,625,718		1988	40 yrs.
42 Kings Hill Avenue	West Malling, UK		—		—		—		16,686,576		3,964,227		12,722,349		16,686,576		538,112		2005	40 yrs.
Liberty Square Retail Blocks	West Malling, UK		—		559,590		5,113,902		2,899,426		1,050,098		7,522,820		8,572,918		693,039		2006	40 yrs.
1 Kings Hill Aveune	West Malling, UK		—		—		—		13,108,043		3,651,552		9,456,491		13,108,043		458,779		2006	40 yrs.
Liberty Square	West Malling, UK		—		—		—		330,317		—		330,317		330,317		(157	)	2006	40 yrs.
3612 La Grange Parkway	Williamsburg, VA		—		—		—		5,722,994		887,234		4,835,761		5,722,994		530,944		2003	40 yrs.
7805 Hudson Road	Woodbury, MN		—		1,279,834		—		10,283,324		1,385,739		10,177,420		11,563,158		2,818,147		2002	40 yrs.
Subtotal Operating Real Estate		$	73,031,582	$	739,850,862	$	1,806,581,935	$	2,527,084,867	$	813,396,833	$	4,260,120,830	$	5,073,517,664	$	982,114,170

60

LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2008

								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		12/31/2008		12/31/08		Acquisition	(years)
DEVELOPMENT PROPERTIES
750 Park of Commerce Boulevard	Boca Raton, FL		—		2,430,000		—		18,111,076		—		20,541,076		20,541,076		—	2007	N/A
8500 Industrial Bouldvard	Breinigsville, PA		—		8,752,708		—		33,267,256		—		42,019,964		42,019,964		—	2007	N/A
676 Independence Parkway	Chesapeake, VA		—		1,527,303		—		8,699,711		—		10,227,014		10,227,014		—	2006	N/A
11841 Newgate Boulevard	Hagerstown, MD		—		3,356,207		—		24,227,728		—		27,583,935		27,583,935		—	2008	N/A
7361 Coca Cola Drive	Hanover, MD		—		2,245,187		—		7,629,724		—		9,874,911		9,874,911		—	2004	N/A
4700 Nathan Lane N — Expansion	Minneapolis, MN		—		—		—		437,333		—		437,333		437,333		—	2008	N/A
3100 SW 145th Avenue	Miramar, FL		—		6,204,407		—		14,345,267		—		20,549,674		20,549,674		—	2007	N/A
27th Street	Oak Creek, WI		—		348,280		—		3,696,508		—		4,044,788		4,044,788		—	2007	N/A
Corporate Preserve Drive	Oak Creek, WI		—		516,016		—		3,873,031		—		4,389,047		4,389,047		—	2007	N/A
201 Summit Park Drive	Orlando, FL		—		1,009,532		—		10,583,667		—		11,593,199		11,593,199		—	2008	N/A
4300 South 26th Street	Philadelphia, PA				—		—		27,848,311		—		27,848,311		27,848,311		—	2008	N/A
3 Crescent Drive	Philadelphia, PA		—		214,726		—		14,404,565		—		14,619,291		14,619,291		—	2008	N/A
4610 South 44th Street	Phoenix, AZ		—		6,539,310		—		4,650,492		—		11,189,801		11,189,801		—	2007	N/A
4550 South 44th Street	Phoenix, AZ		—		5,380,972		—		3,791,364		—		9,172,336		9,172,336		—	2007	N/A
3901 Westerre Parkway	Richmond, VA		—		634,231		—		11,511,294		—		12,145,525		12,145,525		—	2003	N/A
540 Eastpark Court	Richmond, VA		—		742,300		—		4,677,279		—		5,419,579		5,419,579		—	2007	N/A
4631 Woodland Corporate Blvd	Tampa, FL		—		1,453,367		—		12,353,851		—		13,807,218		13,807,218		—	2006	N/A
Subtotal Development in Progress		$	—	$	41,354,546	$	—	$	204,108,454	$	—	$	245,463,000	$	245,463,000	$	—

61

LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2008

								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		12/31/2008		12/31/08		Acquisition	(years)
LAND HELD FOR DEVELOPMENT
Perryman Road Land	Aberdeen, MD		—		12,052,635		—		274,379		12,327,014		—		12,327,014		—	2000	N/A
2 Womack Drive Land	Annapolis, MD		—		5,796,667		—		6,444		5,803,111		—		5,803,111		—	2005	N/A
Boca Colannade Yamato Road	Boca Raton, FL		—		2,039,735		—		566,124		2,605,859		—		2,605,859		—	2001	N/A
Flying Cloud Drive Land	Eden Pairie, MN		—		2,051,631		—		3,701		2,055,331		—		2,055,331		—	1997	N/A
Camelback 303 Business Center Land	Goodyear, AZ		—		16,857,556		—		3,216,158		20,073,714		—		20,073,714		—	2005	N/A
Pleasant Ridge Road Land	Greensboro, NC		—		564,535		—		2,895,957		3,460,492		—		3,460,492		—	2008	N/A
Southchase Business Park Land	Greenville, SC		—		1,308,325		—		705,094		2,013,419		—		2,013,419		—	2007	N/A
Caliber Ridge Ind. Park Land	Greer, SC		—		2,297,492		—		3,562,592		5,860,084		—		5,860,084		—	2007	N/A
Hunters Green Land	Hagerstown, MD		—		5,489,586		—		8,334,639		13,824,225		—		13,824,225		—	1999	N/A
Lakefront Plaza II Land	Hampton, VA		229,953		138,101		—		101,061		239,162		—		239,162		—	2007	N/A
Ridge Road Land	Hanover, MD		—		3,371,183		—		439,543		3,810,727		—		3,810,727		—	2007	N/A
Mendenhall Land	High Point, NC		—		1,757,675		—		1,645,453		3,403,128		—		3,403,128		—	1998	N/A
Piedmond Centre Land	High Point, NC		—		913,276		—		757,687		1,670,963		—		1,670,963		—	1995	N/A
Commonwealth Corporate Center Land	Horsham, PA		—		3,043,938		—		25,160		3,069,098		—		3,069,098		—	1998	N/A
Beltway 8 @Bammel Bus Park Land	Houston, TX		—		1,072,634		—		13,656		1,086,290		—		1,086,290		—	2006	N/A
Central Green Land — Tract 5	Houston, TX		—		4,169,183		—		580,110		4,749,293		—		4,749,293		—	2000	N/A
Greens Crossing Land	Houston, TX		—		2,476,892		—		14,369		2,491,261		—		2,491,261		—	1995	N/A
Rankin Road Land	Houston, TX		—		5,756,865		—		94,054		5,850,919		—		5,850,919		—	1996	N/A
Hollister Beltway 8 Land	Houston, TX		—		6,282,232		—		88,510		6,370,741		—		6,370,741		—	2006	N/A
Noxell Land	Hunt Valley, MD		—		2,040,690		—		1,173		2,041,863		—		2,041,863		—	2007	N/A
Liberty Business Park Land	Jacksonville, FL		—		456,269		—		82,345		538,614		—		538,614		—	1987	N/A
7024 AC Skinner Parkway	Jacksonville, FL		—		751,448		—		73,504		824,952		—		824,952		—	2007	N/A
Belfort Road	Jacksonville, FL		—		492,908		—		87,304		580,212		—		580,212		—	2006	N/A
Salisbury Road Land	Jacksonville, FL		—		1,402,337		—		198,904		1,601,241		—		1,601,241		—	2005	N/A
Skinner Land Parcel B	Jacksonville, FL		—		2,295,790		—		1,230,516		3,526,306		—		3,526,306		—	2008	N/A
Imeson Road Land	Jacksonville, FL		—		4,153,948		—		158,922		4,312,870		—		4,312,870		—	2000	N/A
Kent County, UK	Kent County, UK		—		—		—		14,577,381		14,577,381		—		14,577,381		—	1999	N/A
Commodore Business Park	Logan, NJ		—		792,118		—		671,146		1,463,264		—		1,463,264		—	1998	N/A
Quarry Ridge Land	Malvern, PA		—		4,774,994		—		5,850,801		10,625,795		—		10,625,795		—	2007	N/A
Park Place South Land	Milwaukee, WI		—		1,290,032		—		2,230,261		3,520,293		—		3,520,293		—	2006	N/A
Monarch Towne Center Land	Mirarar, FL		—		6,085,337		—		413,926		6,499,264		—		6,499,264		—	2006	N/A
South 27th Street Land	Oak Creek, WI		—		2,169,232		—		2,685,212		4,854,444		—		4,854,444		—	2001	N/A
Beachline Industrial Park Land	Orlando, FL		—		365,230		—		—		365,230		—		365,230		—	2006	N/A
JFK & Arch Parking Lots/Land (West)	Philadelphia, PA		—		4,792,286		—		4,147,633		8,939,919		—		8,939,919		—	2007	N/A
Cotton Center Land	Phoenix, AZ		—		4,449,689		—		40		4,449,729		—		4,449,729		—	1997	N/A
Eastport VIII	Richmond, VA		—		382,698		—		3,325		386,023		—		386,023		—	2006	N/A
Eastport IX	Richmond, VA		—		211,627		—		3,325		214,952		—		214,952		—	1998	N/A
IRS Distribution Ctr Land	Richmond, VA		—		12,981		—		—		12,981		—		12,981		—	2007	N/A
Woodlands Center Land	Sandston, VA		—		148,314		—		19,354		167,668		—		167,668		—	2007	N/A
Northsight Land (LPLP)	Scottsdale, AZ		—		6,176,464		—		2,204,597		8,381,061		—		8,381,061		—	2001	N/A
Old Scotland Road Land	Shippensburg, PA		—		8,322,686		—		2,562,070		10,884,757		—		10,884,757		—	2005	N/A
Bridgeway II Land	Suffolk, VA		—		603,391		—		2,022,814		2,626,205		—		2,626,205		—	1995	N/A
Suffolk Land	Suffolk, VA		—		2,715,714		—		675,966		3,391,680		—		3,391,680		—	2005	N/A
6119 W. Linebaugh Avenue	Tampa, FL		—		180,136		—		30,500		210,635		—		210,635		—	2005	N/A
Tampa Triangle Land	Tampa, FL		—		10,358,826		—		1,125,564		11,484,390		—		11,484,390			2006	N/A
Renaissance Park Land	Tampa, FL		—		1,995,375		—		308,575		2,303,950		—		2,303,950		—	2007	N/A
Subtotal Land Held for Development		$	229,953	$	150,902,343	$	—	$	58,648,168	$	209,550,512	$	—	$	209,550,512	$	—
Total All Properties		$	73,261,535	$	932,107,751	$	1,806,581,935	$	2,789,841,489	$	1,022,947,345	$	4,505,583,831	$	5,528,531,176	$	982,114,170

* Denotes property is collateralized under mortgages with American General, USG Annuity and Life, Metropolitan Life and LaSalle Bank totaling $122.4 million.

62

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,
	2008			2007			2006
REAL ESTATE:
Balance at beginning of year	$	5,765,409		$	5,101,280		$	4,649,302
Additions		330,371			939,322			820,012
Disposition of property		(567,248	)		(275,193	)		(368,034	)
Balance at end of year	$	5,528,532		$	5,765,409		$	5,101,280
ACCUMULATED DEPRECIATION:
Balance at beginning of year	$	858,671		$	782,750		$	712,786
Depreciation expense		140,925			126,852			120,947
Disposition of property		(17,482	)		(50,931	)		(50,983	)
Balance at end of year	$	982,114		$	858,671		$	782,750

63

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, 2008 and 2007, and the related consolidated statements of operations, equity, and cash flows for each of the three years in the period ended December 31, 2008. 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 financial statements referred to above present fairly, in all material respects, the consolidated financial position of Liberty Property Limited Partnership at December 31, 2008 and 2007, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2008, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in Note 14, these consolidated financial statements have been revised to give effect to certain adjustments.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Liberty Property Limited Partnership’s internal control over financial reporting as of December 31, 2008, 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 25, 2009 (not provided herein) expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania
February 25, 2009 except for Notes 2, 8, 11, 12, 13 and 14 as to which the date is May 19, 2009.

64

CONSOLIDATED BALANCE SHEETS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(IN THOUSANDS)

	December 31,
	2008			2007
ASSETS
Real estate:
Land and land improvements	$	813,397		$	792,991
Buildings and improvements		4,260,121			4,408,309
Less accumulated depreciation		(982,114	)		(858,671	)
Operating real estate		4,091,404			4,342,629
Development in progress		245,463			316,985
Land held for development		209,551			247,124
Net real estate		4,546,418			4,906,738
Cash and cash equivalents		15,794			37,989
Restricted cash		39,726			34,567
Accounts receivable, net		12,985			15,908
Deferred rent receivable		85,352			79,720
Deferred financing and leasing costs, net		134,029			144,295
Investments in and advances to unconsolidated joint ventures		266,602			278,383
Assets held for sale		33,662			36,908
Prepaid expenses and other assets		82,467			109,429
Total assets	$	5,217,035		$	5,643,937
LIABILITIES
Mortgage loans	$	198,560		$	243,169
Unsecured notes		2,131,607			2,155,000
Credit facility		260,000			622,960
Accounts payable		32,481			44,666
Accrued interest		36,474			39,725
Distributions payable		48,858			59,849
Other liabilities		182,549			268,926
Total liabilities		2,890,529			3,434,295
Noncontrolling interest-consolidated joint ventures		1,130			517
Limited partners’ equity – preferred units, 9,740,000 preferred units outstanding as of December 31, 2008 and December 31, 2007		287,959			287,960
– common units, 4,074,967 and 4,189,967 common units outstanding as of December 31, 2008 and December 31, 2007, respectively		117,546			120,832
OWNERS’ EQUITY
General partner’s equity – common units, 100,034,404 and 92,817,879 units outstanding as of December 31, 2008 and December 31, 2007, respectively		1,919,871			1,800,333
Total liabilities and owners’ equity	$	5,217,035		$	5,643,937

See accompanying notes.

65

CONSOLIDATED STATEMENTS OF OPERATIONS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(IN THOUSANDS, EXCEPT PER UNIT AMOUNTS)

	Year Ended December 31,
	2008			2007			2006
OPERATING REVENUE
Rental	$	518,507		$	478,814		$	425,680
Operating expense reimbursement		227,501			206,071			180,140
Total operating revenue		746,008			684,885			605,820
OPERATING EXPENSES
Rental property		152,227			143,183			122,454
Real estate taxes		86,015			72,296			64,413
General and administrative		54,387			54,334			46,358
Depreciation and amortization		172,594			155,248			131,822
Total operating expenses		465,223			425,061			365,047
Operating income		280,785			259,824			240,773
OTHER INCOME (EXPENSE)
Interest and other income		13,501			11,720			8,690
Debt extinguishment gain		2,521			—			—
Interest expense		(155,198	)		(126,707	)		(109,265	)
Total other income(expense)		(139,176	)		(114,987	)		(100,575	)
Income before property dispositions, income taxes and equity in (loss) earnings of unconsolidated joint ventures		141,609			144,837			140,198
Gain on property dispositions		10,572			1,463		��	17,628
Income taxes		(1,645	)		709			(288	)
Equity in earnings (loss) of unconsolidated joint ventures		2,805			(226	)		1,432
Income from continuing operations		153,341			146,783			158,970
Discontinued operations (including net gain on property dispositions of $23,519, $33,611 and $112,620 for the years ended December 31, 2008, 2007 and 2006, respectively)		26,765			43,527			133,073
Net income		180,106			190,310			292,043
Noncontrolling interest-consolidated joint venture		(483	)		(101	)		7
Preferred unit distributions		21,012			17,126			13,691
Excess of preferred unit redemption over carrying amount		—			696			—
Income available to common unitholders	$	158,611		$	172,387		$	278,359
Earnings per common unit
Basic:
Income from continuing operations	$	1.35		$	1.35		$	1.55
Income from discontinued operations		0.27			0.46			1.43
Income per common unit — basic	$	1.62		$	1.81		$	2.98
Diluted:
Income from continuing operations	$	1.35		$	1.35		$	1.54
Income from discontinued operations		0.27			0.45			1.41
Income per common unit — diluted	$	1.62		$	1.80		$	2.95
Weighted average number of common units outstanding
Basic		97,814			95,375			93,208
Diluted		97,994			95,993			94,387

See accompanying notes.

66

CONSOLIDATED STATEMENTS OF EQUITY OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(IN THOUSANDS)

	General
	Partner’s
	Equity
Balance at January 1, 2006	$	1,626,531
Contributions from partners		93,255
Distributions to partners		(221,907	)
Foreign currency translation adjustment		10,417
Net income		266,574
Redemption of limited partners’ common units for common shares		(22,811	)
Balance at December 31, 2006		1,752,059
Contributions from partners		78,493
Distributions to partners		(278,209	)
Foreign currency translation adjustment		1,055
Net income		164,831
Redemption of limited partners’ common units for common shares		82,104
Balance at December 31, 2007		1,800,333
Contributions from partners		215,375
Distributions to partners		(221,023	)
Foreign currency translation adjustment		(26,756	)
Net income		151,942
Balance at December 31, 2008	$	1,919,871

See accompanying notes.

67

CONSOLIDATED STATEMENTS OF CASH FLOWS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(IN THOUSANDS)

	Year Ended December 31,
	2008			2007			2006
OPERATING ACTIVITIES
Net income	$	180,106		$	190,310		$	292,043
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		175,236			163,665			151,966
Amortization of deferred financing costs		4,429			4,137			4,244
Equity in loss (earnings) of unconsolidated joint ventures		(2,805	)		226			(1,432	)
Distributions from unconsolidated joint ventures		1,660			3,550			5,692
Gain on property dispositions		(34,091	)		(35,074	)		(130,248	)
Noncash compensation		9,152			8,128			6,212
Changes in operating assets and liabilities:
Restricted cash		(10,903	)		26,211			(21,692	)
Accounts receivable		(4,277	)		4,634			(6,879	)
Deferred rent receivable		(13,482	)		(13,455	)		924
Prepaid expenses and other assets		(26,326	)		(14,145	)		(14,394	)
Accounts payable		(10,913	)		3,974			7,648
Accrued interest		(3,251	)		3,428			1,405
Other liabilities		3,935			1,163			29,084
Net cash provided by operating activities		268,470			346,752			324,573
INVESTING ACTIVITIES
Investment in properties		(60,078	)		(307,846	)		(372,610	)
Cash paid for business, net of cash acquired		—			(626,007	)		—
Investments in and advances to unconsolidated joint ventures		58,250			(227,385	)		(6,239	)
Net proceeds from disposition of properties/land		382,956			996,474			492,548
Investment in development in progress		(247,393	)		(417,877	)		(339,631	)
Increase in land held for development		(47,857	)		(137,051	)		(79,976	)
Increase in deferred leasing costs		(33,325	)		(39,232	)		(29,034	)
Net cash provided by (used in) investing activities		52,553			(758,924	)		(334,942	)
FINANCING ACTIVITIES
Net proceeds from issuance of notes payable		—			415,063			—
Redemption of notes payable		—			(415,063	)		—
Net proceeds from issuance of unsecured notes		—			446,205			295,393
Repayment of unsecured notes		(23,393	)		(250,000	)		(100,000	)
Proceeds from mortgage loans		2,667			—			—
Repayments of mortgage loans		(46,452	)		(16,365	)		(56,406	)
Proceeds from credit facility		572,300			1,363,050			725,025
Repayments on credit facility		(782,300	)		(987,050	)		(733,515	)
Increase in deferred financing costs		(33	)		(1,224	)		(1,635	)
Capital contributions		206,349			170,313			113,348
Distributions to partners		(262,973	)		(328,607	)		(242,537	)
Net cash (used in) provided by financing activities		(333,835	)		396,322			(327	)
Decrease in cash and cash equivalents		(12,812	)		(15,850	)		(10,696	)
(Decrease) increase in cash and cash equivalents related to foreign currency translation		(9,383	)		102			2,804
Cash and cash equivalents at beginning of year		37,989			53,737			61,629
Cash and cash equivalents at end of year	$	15,794		$	37,989		$	53,737
SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS
Write-off of fully depreciated property and deferred costs	$	31,421		$	102,902		$	87,424
Issuance of operating partnership common units		—			—			30,000
Acquisition of properties		—			(73,556	)		(3,066	)
Assumption of mortgage loans		—			73,556			3,066

See accompanying notes.

68

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 96.0% of the common equity of the Operating Partnership at December 31, 2008. 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, Midwestern and Southwestern United States and the United Kingdom.

All square footage amounts are unaudited.

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 noncontrolling 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)
Capital improvements	15 – 20 years
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 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 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 intangibles 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.

69

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 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 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.

On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated joint ventures may be impaired. An investment is impaired only if management’s estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the estimated fair value of the investment.

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/Deferred Rent 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 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.

The allowance for doubtful accounts at December 31, 2008 and 2007 was $8.5 million and $6.0 million, respectively.

Goodwill

Goodwill represents the amounts paid in excess of the fair value of the net assets acquired from business acquisitions accounted for under SFAS No. 141, “Business Combinations”. Pursuant to SFAS No. 142,“Accounting for Goodwill and Intangible Assets”(“SFAS 142”) goodwill is not amortized to expense but rather is analyzed for impairment. In conjunction with the purchase of Republic, goodwill of $15.3 million was recorded. The goodwill is assigned to the Northern Virginia/Washington, D.C. operation (“reporting unit”) which is part of the Philadelphia reportable segment and is included in prepaid expenses and other assets on the Company’s consolidated balance sheets. The Company assesses goodwill for impairment annually in November and in interim periods if certain events occur indicating the carrying value may be impaired. The Company performs its analysis for potential impairment of goodwill in accordance with SFAS 142, which requires that a two-step impairment test be performed on goodwill. In the first step, the fair value of the reporting unit is compared to its carrying value. If the fair value exceeds its carrying value, goodwill is not impaired, and no further testing is required. If the carrying value of the reporting unit exceeds its fair value, then a second step must be performed in order to determine the implied fair value of the goodwill and compare it to the carrying value of the goodwill. If the carrying value of goodwill exceeds its implied fair value then an impairment loss is recorded equal to the difference. No impairment losses were recognized during the years ended December 31, 2008 or 2007.

70

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)	collectability 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.

Income per Common Unit

The following table sets forth the computation of basic and diluted income per common unit, updated to reflect discontinued operations as of March 31, 2009 (in thousands, except per unit amounts):

	2008							2007
				Weighted							Weighted
				Average							Average
	Income			Units		Per		Income			Units		Per
	(Numerator)			(Denominator)		Unit		(Numerator)			(Denominator)		Unit
Income from continuing operations	$	152,858						$	146,682
Less: Preferred unit distributions		(21,012	)						(17,126	)
Excess of preferred unit redemption over carrying amount		—							(696	)
Basic income from continuing operations
Income from continuing operations available to common unitholders		131,846			97,814	$	1.35		128,860			95,375	$	1.35
Dilutive units for long-term compensation plans		—			180				—			618
Diluted income from continuing operations
Income from continuing operations available to common unitholders and assumed conversions		131,846			97,994	$	1.35		128,860			95,993	$	1.35
Basic income from discontinued operations
Discontinued operations		26,765			97,814	$	0.27		43,527			95,375	$	0.46
Dilutive units for long-term compensation plans		—			180				—			618
Diluted income from discontinued operations
Discontinued operations		26,765			97,994	$	0.27		43,527			95,993	$	0.45
Basic income per common unit
Income available to common unitholders		158,611			97,814	$	1.62		172,387			95,375	$	1.81
Dilutive units for long-term compensation plans		—			180				—			618
Diluted income per common unit
Income available to common unitholders and assumed conversions	$	158,611			97,994	$	1.62	$	172,387			95,993	$	1.80

71

	2006
				Weighted
				Average
	Income			Units		Per
	(Numerator)			(Denominator)		Unit
Income from continuing operations	$	158,977
Less: Preferred unit distributions		(13,691	)
Basic income from continuing operations
Income from continuing operations available to common unitholders		145,286			93,208	$	1.55
Dilutive units for long-term compensation plans		—			1,179
Diluted income from continuing operations
Income from continuing operations available to common unitholders and assumed conversions		145,286			94,387	$	1.54
Basic income from discontinued operations
Discontinued operations		133,073			93,208	$	1.43
Dilutive units for long-term compensation plans		—			1,179
Diluted income from discontinued operations
Discontinued operations		133,073			94,387	$	1.41
Basic income per common unit
Income available to common unitholders		278,359			93,208	$	2.98
Dilutive units for long-term compensation plans		—			1,179
Diluted income per common unit
Income available to common unitholders and assumed Conversions	$	278,359			94,387	$	2.95

Fair Value of Financial Instruments

The carrying value of cash and cash equivalents, restricted cash, accounts 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, 2008 for comparable loans, is less than the aggregate carrying value by approximately $713.1 million at December 31, 2008.

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, the United Kingdom and Luxembourg. Accordingly, the Company has recognized federal, state, local and foreign taxes in accordance with US GAAP, as applicable.

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.” The Company adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, no uncertain tax positions were identified which would result in the recording of a liability for unrecognized tax benefits, and correspondingly no benefit recognition was identified that would affect the effective tax rate. Additionally, there are no possibly significant unrecognized tax benefits which are reasonably expected to occur within the next 12 months. The Company’s policy is to recognize interest accrued related to unrecognized benefits in interest expense and penalties in other expense. There are no interest and penalties deducted in the current period and no interest and penalties accrued at December 31, 2008 and December 31, 2007.

Certain of the Company’s taxable REIT subsidiaries have net operating loss carryforwards available of approximately $19.3 million. These carryforwards begin to expire in 2018. The Company has considered estimated future taxable income and have determined that a valuation allowance for the full carrying value of net operating loss carryforwards is appropriate.

72

The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction, certain state and local jurisdictions, the United Kingdom and Luxembourg.  With few exceptions, the Company is no longer subject to U.S. federal, state, and local, or United Kingdom and Luxembourg examinations by tax authorities for years before 2005.

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 general partner’s equity-common units. Other comprehensive (loss) income was ($26.8) million, $1.1 million and $10.4 million for the years ended December 31, 2008, 2007 and 2006, 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 general partner’s equity-common units.

73

Recently Issued Accounting Standards

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 US GAAP and expands disclosures about fair value measurements. The hierarchy is measured in three levels based on the reliability of inputs:

Level 1- Valuations based on quoted prices in active markets for identical assets or liabilities in a market that the Company has the ability to access.

Level 2- Valuations based on quoted prices for similar assets or liabilities, or inputs that are observable, either directly or indirectly, through corroboration with observable market data.

Level 3- Valuations derived from other valuation methodologies, including pricing models, discounted cash flow models, and similar techniques. Level 3 valuations incorporate certain assumptions and projections that are not directly observable in the market and significant professional judgment in determining the fair value assigned to such assets or liabilities.

The Company adopted the provisions of SFAS No. 157 on January 1, 2008. The adoption of this statement did not have a material effect on the Company’s financial position or results of operations.

SFAS No. 159

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“SFAS No. 159”). SFAS No. 159 provides companies with an option to report selected financial assets and liabilities at fair value and establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. The Company adopted the provisions of SFAS No. 159 on January 1, 2008. The adoption of this statement did not have a material effect on the Company’s financial position or results of operations.

SFAS No. 141(R)

In December 2007, the FASB issued SFAS No. 141(R), “Applying the Acquisition Method” (“SFAS No. 141(R)”). This statement changes the accounting for acquisitions specifically eliminating the step acquisition model, changing the recognition of contingent consideration from being recognized when it is probable to being recognized at the time of acquisition, disallowing the capitalization of transaction costs and delays when restructurings related to acquisitions can be recognized. SFAS No. 141(R) is effective for fiscal years beginning after December 15, 2008 and will impact the accounting for acquisitions made beginning January 1, 2009. The Company does not anticipate that the adoption of this statement will have a material effect on its financial position or results of operations.

FSP EITF 03-6-1

In June 2008, the FASB issued FASB Staff Position (“FSP”) Emerging Issues Task Force (“EITF”) 03-6-1, “Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities.”  The FSP clarifies that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method.  FSP EITF 03-6-1 is effective for fiscal years beginning after December 15, 2008.  The Company does not anticipate that the adoption of this statement will have a material effect on its financial position or results of operations.

74

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, 2008 and 2007 is as follows (in thousands):

	Land		Buildings
	And Land		And				Accumulated
	Improvements		Improvements		Total		Depreciation
2008
Industrial properties	$	361,911	$	1,831,862	$	2,193,773	$	433,904
Office properties		451,486		2,428,259		2,879,745		548,210
2008 Total	$	813,397	$	4,260,121	$	5,073,518	$	982,114
2007
Industrial properties	$	337,675	$	1,717,500	$	2,055,175	$	382,241
Office properties		455,316		2,690,809		3,146,125		476,430
2007 Total	$	792,991	$	4,408,309	$	5,201,300	$	858,671

Depreciation expense was $147.2 million in 2008, $135.4 million in 2007 and $124.9 million in 2006.

As of December 31, 2008, the Company had commenced development on 17 properties, which upon completion are expected to comprise 3.2 million square feet of leaseable space. As of December 31, 2008, $245.5 million had been expended for the development of these projects and an additional $128.1 million is estimated to be required for completion.

Additionally, unconsolidated joint ventures in which the Company had an interest had commenced development on four properties, which upon completion are expected to comprise 1.4 million square feet of leaseable space. As of December 31, 2008, $135.3 million had been expended for the development of these projects and an additional $51.1 million is estimated to be required for completion.

Information on the operating properties the Company sold during the years ended December 31, 2008 and 2007 is as follows:

2008 Sales

	Number of		Leaseable
Segment	Buildings		Square Feet		Gross Proceeds
					(in thousands)
Northeast
Southeastern PA		2		166,160	$	33,557
New Jersey		5		159,989		15,100
Midwest		3		125,876		9,420
Mid-Atlantic		2		129,150		16,650
Florida		1		83,583		5,300
Total		13		664,758	$	80,027

75

2007 Sales

	Number of		Leaseable
Segment	Buildings		Square Feet		Gross Proceeds
					(in thousands)
Northeast
Southeastern PA		1		141,714	$	8,650
Lehigh/Central PA		1		289,800		13,775
Midwest		60		4,257,477		317,600
Mid-Atlantic		6		399,258		21,363
Florida		2		152,219		8,152
Total		70		5,240,468	$	369,540

In addition, in 2008, the Company recognized the sale of the 1.25 million square foot Comcast Center to an unconsolidated joint venture. At the time of the sale, 968,000 leaseable square feet were in service and 282,000 square feet were under development. The gross proceeds from the sale were $512 million. See Note 4 below.

4. INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES

Listed below are the unconsolidated joint ventures in which the Company has a noncontrolling interest. The Company receives fees from these joint ventures for services it provides. These services include property management, leasing, development and administration. These fees are included in interest and other income in the accompanying consolidated statements of operations. The Company may also receive a promoted interest if certain return thresholds are met.

Liberty Venture I, LP

The Company has a 25% interest in Liberty Venture I, LP, an entity engaged in the ownership of industrial properties in New Jersey.

As of December 31, 2008, the joint venture owned 24 industrial properties totaling 3.1 million square feet and 43 acres of developable land, as well as a development property that, when completed, is expected to contain an additional 225,000 square feet of leaseable space. The Company has guaranteed cost overruns in excess of the approved project budget for the development property. The Company considers payments under the guarantee unlikely.

The Company recognized $1.5 million, $802,000 and $634,000 in fees for services during the years ended December 31, 2008, 2007 and 2006, respectively.

Kings Hill Unit Trust

The Company has a 20% interest in Kings Hill Unit Trust, an entity engaged in the ownership of office and industrial properties in the County of Kent, United Kingdom.

As of December 31, 2008, the joint venture owned 10 office properties and five industrial properties totaling 536,000 square feet.

The Company holds a $4.1 million note receivable from Kings Hill Unit Trust. The note receivable bears interest at a 9% rate and is due in December 2010.

Income from fees and interest was $764,000, $1.6 million and $1.3 million during the years ended December 31, 2008, 2007 and 2006, respectively.

Liberty/Commerz 1701 JFK Boulevard, LP

On April 13, 2006, the Company entered into a joint venture pursuant to which it sold an 80% interest in the equity of Comcast Center, a 1.25 million square foot office tower the Company was then developing in Philadelphia, Pennsylvania. The transaction valued the property at $512 million. Upon signing the joint venture agreement and through March 30, 2008, the criteria for sale recognition in accordance with SFAS No. 66,“Accounting for the Sales of Real Estate”(“SFAS No. 66”) had not been met and the transaction was accounted for as a financing arrangement.

76

On March 31, 2008, a $324 million, ten-year secured financing at a 6.15% interest rate for Comcast Center was funded. The proceeds from this financing were used to pay down outstanding borrowings on the Company’s credit facility.

On March 31, 2008, all conditions for sale treatment as outlined in SFAS No. 66 were satisfied and the Company recognized the sale of Comcast Center to an unconsolidated joint venture. Profit on the transaction was deferred until the costs of the project could be reasonably estimated. Profit on the sale of $6.6 million was recognized in the fourth quarter of 2008.

As of December 31, 2008, the Company had a $15.1 million receivable from this joint venture.  This related party receivable is due to the funding of joint venture development costs and is reflected in investments in and advances to unconsolidated joint ventures the Company’s consolidated balance sheets. 

The Company recognized $883,000 in fees for services during the year ended December 31, 2008.

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 industrial properties totaling 2.1 million square feet and 104 acres of developable land. The joint venture valued the buildings and land at $125.0 million.

As of December 31, 2008, the joint venture owned 14 industrial properties totaling 4.6 million square feet and 364 acres of developable land, as well as a development property that, when completed, is expected to contain an additional 464,000 square feet of leaseable space. The Company has guaranteed cost overruns in excess of the approved project budget for the development property. The Company considers payments under the guarantee unlikely.

The Company recognized $1.2 million, $791,000 and $777,000 in fees for services during the years ended December 31, 2008, 2007 and 2006, respectively.

Blythe Valley JV Sarl

On September 10, 2007, the Company entered into a joint venture to acquire Blythe Valley Park, West Midlands, UK for $325 million. The park consists of 491,000 square feet of office properties and 98 acres of developable land. The Company holds a $5.2 million note receivable from Blythe Valley JV Sarl and has a 20% interest in the joint venture. The note receivable bears interest at a 10% rate and is due in December 2017.

The Company recognized $909,000 and $446,000 in fees for services during the years ended December 31, 2008 and 2007, respectively.

Liberty Washington, LP

On October 4, 2007, the Company acquired Republic Property Trust (“Republic Acquisition”), a Maryland real estate investment trust and Republic Property Limited Partnership, a Delaware limited partnership and Republic’s operating partnership (together, “Republic”) for $916 million. The acquisition of Republic was completed through the merger of Republic with a wholly owned subsidiary of the Company and the merger of Republic’s operating partnership with the Company’s Operating Partnership. Republic operated a portfolio consisting of 2.4 million square feet of office space, six acres of developable land, and a redevelopment property that, when completed, is expected to contain an additional 176,000 square feet of office space in the Northern Virginia and Washington, D.C. markets. The Company has guaranteed cost overruns in excess of the approved project budget for the development property. The Company considers payments under the guarantee unlikely.

Concurrently, the Company formed a joint venture with New York State Common Retirement Fund to own and manage the Republic portfolio (“Republic Disposition”). The joint venture, in which the Company holds a 25% interest, purchased the Republic real estate assets for $900 million. The acquisition of Republic resulted in the Company recording $16 million in goodwill and other intangibles.

The Company had a $59.5 million note receivable from Liberty Washington, LP that was repaid in 2008.

The Company recognized $5.6 million and $2.1 million in interest and fees for services during the year ended December 31, 2008 and 2007, respectively.

77

Other Joint Ventures

As of December 31, 2008, the Company has a 50% ownership interest in three additional unconsolidated joint ventures.  One of these joint ventures has three operating properties and investments in a property under development and land held for development.  For the development project, the Company has guaranteed cost overruns in excess of the approved project budget. The Company considers payments under the guarantee unlikely. One of these joint ventures has one operating property, an investment in land held for development and a leasehold interest.  The other joint venture has a leasehold interest and does 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, 2008 and 2007 and statements of operations for Liberty Venture I, LP, Kings Hill Unit Trust, Liberty Illinois, LP, Blythe Valley JV Sarl, Liberty Washington, LP, Liberty Commerz 1701 JFK Boulevard, LP and other unconsolidated joint ventures for the years ended December 31, 2008, 2007 and 2006 are as follows (in thousands):

Balance Sheets:

	December 31, 2008
	Liberty									Blythe						Liberty Commerz
	Venture I,			Kings Hill			Liberty			Valley JV			Liberty			1701 JFK
	LP			Unit Trust			Illinois, LP			Sarl			Washington, LP			Boulevard, LP			Other			Total
Real estate assets	$	119,523		$	170,521		$	227,318		$	189,256		$	804,587		$	492,189		$	57,933		$	2,061,327
Accumulated depreciation		(16,285	)		(8,971	)		(12,436	)		(5,301	)		(28,515	)		(14,013	)		(790	)		(86,311	)
Real estate assets, net		103,238			161,550			214,882			183,955			776,072			478,176			57,143			1,975,016
Development in progress		9,948			—			16,252			—			101,653			—			7,524			135,377
Land held for development		2,733			—			42,338			42,668			7,859			—			14,435			110,033
Other assets		13,585			10,481			9,506			10,353			58,485			65,495			31,654			199,559
Total assets	$	129,504		$	172,031		$	282,978		$	236,976		$	944,069		$	543,671		$	110,756		$	2,419,985
Debt	$	82,813		$	138,634		$	145,504		$	180,004		$	350,121		$	324,000		$	38,830		$	1,259,906
Other liabilities		2,168			38,112			7,481			37,899			40,919			32,362			19,764			178,705
Equity		44,523			(4,715	)		129,993			19,073			553,029			187,309			52,162			981,374
Total liabilities and equity	$	129,504		$	172,031		$	282,978		$	236,976		$	944,069		$	543,671		$	110,756		$	2,419,985
Company’s net investment in unconsolidated joint ventures (1)	$	10,355		$	3,415		$	26,583		$	9,129		$	138,102		$	50,899		$	28,119		$	266,602

78

	December 31, 2007
																Liberty
										Blythe			Liberty			Commerz 1701
	Liberty			Kings Hill			Liberty			Valley JV			Washington,			JFK Boulevard,
	Venture I, LP			Unit Trust			Illinois, LP			Sarl			LP			LP		Other			Total
Real estate assets	$	118,030		$	231,399		$	225,405		$	267,488		$	802,146		$	—	$	14,586		$	1,659,054
Accumulated depreciation		(13,115	)		(8,385	)		(6,533	)		(2,004	)		(5,746	)		—		(60	)		(35,843	)
Real estate assets, net		104,915			223,014			218,872			265,484			796,400			—		14,526			1,623,211
Development in progress		—			—			—			—			76,483			—		40,694			117,177
Land held for development		2,733			—			41,008			48,712			7,859			—		28,201			128,513
Other assets		24,185			17,551			11,871			18,716			54,684			—		15,513			142,520
Total assets	$	131,833		$	240,565		$	271,751		$	332,912		$	935,426		$	—	$	98,934		$	2,011,421
Debt	$	81,216		$	188,765		$	145,400		$	251,654		$	339,120		$	—	$	43,249		$	1,049,404
Other liabilities		2,830			50,656			3,677			40,399			43,491			—		3,834			144,887
Equity		47,787			1,144			122,674			40,859			552,815			—		51,851			817,130
Total liabilities and equity	$	131,833		$	240,565		$	271,751		$	332,912		$	935,426		$	—	$	98,934		$	2,011,421
Company’s net investment in unconsolidated joint ventures (1)	$	11,352		$	6,002		$	24,729		$	11,773		$	197,622		$	—	$	26,905		$	278,383

(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 and loans made to the joint ventures by the Company. 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, 2008
																Liberty
	Liberty									Blythe			Liberty			Commerz 1701
	Venture I,			Kings Hill			Liberty			Valley JV			Washington			JFK Boulevard,
	LP			Unit Trust			Illinois, LP			Sarl			, LP			LP			Other			Total
Total revenue	$	19,075		$	18,057		$	22,811		$	15,386		$	76,552		$	43,607		$	3,056		$	198,544
Operating expense		7,074			2,490			7,003			2,377			24,440			15,080			709			59,173
		12,001			15,567			15,808			13,009			52,112			28,527			2,347			139,371
Interest		(4,522	)		(9,900	)		(7,833	)		(14,253	)		(17,670	)		(15,454	)		(2,057	)		(71,689	)
Depreciation and amortization		(4,162	)		(5,272	)		(7,378	)		(5,911	)		(34,951	)		(10,941	)		(862	)		(69,477	)
Other income/(expense)		2,473			(924	)		195			(467	)		722			191			(96	)		2,094
Gain on sale		(3	)		—			—			—			—			—			102			99
Net income (loss)	$	5,787		$	(529	)	$	792		$	(7,622	)	$	213		$	2,323		$	(566	)	$	398
Company’s equity in earnings (loss) of unconsolidated joint ventures	$	1,645		$	167		$	549		$	(1,370	)	$	1,288		$	685		$	(159	)	$	2,805

79

	Year Ended December 31, 2007
																Liberty
	Liberty									Blythe			Liberty			Commerz 1701
	Venture I,			Kings Hill			Liberty			Valley JV			Washington,			JFK Boulevard,
	LP			Unit Trust			Illinois, LP			Sarl			LP			LP		Other			Total
Total revenue	$	18,457		$	19,696		$	17,360		$	5,920		$	18,203		$	—	$	397		$	80,033
Operating expense		5,807			2,374			4,433			5,265			4,273			—		131			22,283
		12,650			17,322			12,927			655			13,930			—		266			57,750
Interest		(4,240	)		(14,583	)		(6,297	)		(6,009	)		(4,299	)		—		(253	)		(35,681	)
Depreciation and amortization		(4,228	)		(7,058	)		(6,316	)		(2,201	)		(8,969	)		—		(70	)		(28,842	)
Other income/(expense)		(76	)		(645	)		(266	)		(220	)		(1,337	)		—		359			(2,185	)
Gain on sale		524			—			—			—			—			—		867			1,391
Net income (loss)	$	4,630		$	(4,964	)	$	48		$	(7,775	)	$	(675	)	$	—	$	1,169		$	(7,567	)
Company’s equity in earnings (loss) of unconsolidated joint ventures	$	1,320		$	(732	)	$	399		$	(1,514	)	$	(232	)	$	—	$	533		$	(226	)

	Year Ended December 31, 2006
														Liberty
	Liberty									Blythe		Liberty		Commerz 1701
	Venture I,			Kings Hill			Liberty			Valley JV		Washington,		JFK Boulevard,
	LP			Unit Trust			Illinois, LP			Sarl		LP		LP		Other			Total
Total revenue	$	18,395		$	18,183		$	7,471		$	—	$	—	$	—	$	—		$	44,049
Operating expense		5,364			2,181			1,833			—		—		—		171			9,549
		13,031			16,002			5,638			—		—		—		(171	)		34,500
Interest		(4,501	)		(13,455	)		(2,527	)		—		—		—		—			(20,483	)
Depreciation and amortization		(4,544	)		(6,267	)		(2,502	)		—		—		—		—			(13,313	)
Other income/(expense)		(127	)		(604	)		5			—		—		—		392			(334	)
Gain on sale		2,644			—			—			—		—		—		138			2,782
Net income (loss)	$	6,503		$	(4,324	)	$	614		$	—	$	—	$	—	$	359		$	3,152
Company’s equity in earnings (loss) of unconsolidated joint ventures	$	1,651		$	(657	)	$	259		$	—	$	—	$	—	$	179		$	1,432

80

5. DEFERRED FINANCING AND LEASING COSTS

Deferred financing and leasing costs at December 31, 2008 and 2007 are as follows (in thousands):

	December 31,
	2008			2007
Deferred leasing costs	$	188,056		$	173,669
Deferred financing costs		8,754			12,077
In-place lease value and related intangible asset		77,564			77,760
		274,374			263,506
Accumulated amortization		(140,345	)		(119,211	)
Total	$	134,029		$	144,295

6. INDEBTEDNESS

Indebtedness consists of mortgage loans, unsecured notes, and borrowings under the credit facility. The weighted average interest rates for the years ended December 31, 2008, 2007 and 2006, were 6.1%, 6.5% and 6.6%, respectively. Interest costs during the years ended December 31, 2008, 2007 and 2006 in the amount of $20.0 million, $45.7 million and $30.8 million, respectively, were capitalized. Cash paid for interest for the years ended December 31, 2008, 2007 and 2006, was $177.0 million, $172.9 million and $150.2 million, respectively.

During the fourth quarter of the year ended December 31, 2008, the Company purchased $23.4 million of its 8.5% senior unsecured notes. These notes were purchased at a $2.5 million discount. The discount is included in net income as a loan extinguishment gain.

During the year ended December 31, 2007, the Company satisfied a $100 million 7.25% senior unsecured note and issued a $300 million 6.625% senior unsecured note due October 1, 2017. The Company used the net proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes. Amounts repaid under the credit facility were subsequently drawn to pay a portion of the cash merger consideration for the purchase of Republic Property Trust.

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.

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, 2008 the Company was in compliance with all financial covenants.

Mortgage Loans, Unsecured Notes

Mortgage loans with maturities ranging from 2009 to 2017 are collateralized by and in some instances cross-collateralized by properties with a net book value of $309.4 million.

The interest rates on $2,327.5 million of mortgage loans and unsecured notes are fixed and range from 5.0% to 8.8%. The weighted average remaining term for the mortgage loans and unsecured notes is 4.9 years.

Credit Facility

$600 Million Unsecured Revolving Credit Facility

The Company has a four-year, $600 million unsecured revolving credit facility (the “$600 million Credit Facility”). 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 $260.0 million of borrowings outstanding as of December 31, 2008 was 1.56%. 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 fee to extend the $600 million Credit Facility for one year is $900,000. The $600 million Credit Facility contains financial covenants, certain of which are set forth below:

81

• 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%.

The scheduled principal amortization and maturities of the Company’s mortgage loans, unsecured notes outstanding and the $600 million Credit Facility 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
2009	$	6,586	$	41,833	$	270,000	$	—	$	318,419		7.76	%
2010		5,823		4,736		176,607		260,000		447,166		4.40	%
2011		5,159		13,409		250,000		—		268,568		7.23	%
2012		4,336		32,875		235,000		—		272,211		6.47	%
2013		3,857		4,510		—		—		8,367		5.79	%
2014		3,888		2,684		200,000		—		206,572		5.66	%
2015		3,336		44,469		300,000		—		347,805		5.25	%
2016		2,409		16,880		300,000		—		319,289		5.55	%
2017		1,770		—		300,000		—		301,770		6.62	%
2018 & thereafter		—		—		100,000		—		100,000		7.50	%
	$	37,164	$	161,396	$	2,131,607	$	260,000	$	2,590,167		6.06	%

7. LEASING ACTIVITY

Future minimum rental payments due from tenants under noncancelable operating leases as of December 31, 2008 are as follows (in thousands):

2008	$	491,933
2009		441,833
2010		375,467
2011		312,982
2012		248,657
Thereafter		680,230
TOTAL	$	2,551,102

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.

82

8. EQUITY

Noncontrolling Interest

Noncontrolling interest in the accompanying financial statements represents the interests of the common and preferred units in Liberty Property Limited Partnership not held by the Trust. In addition, noncontrolling interest includes third-party ownership interests in consolidated joint venture investments.

The following details the change in noncontrolling interest for the years ended December 31, 2008, 2007 and 2006.

	Noncontrolling
	interest -			Limited			Limited partners’
	consolidated			partners’ equity			equity -
	joint ventures			- preferred units			common units
Balance at January 1, 2006	$	407		$	184,656		$	150,721
Contributions from partners		19			—			—
Distributions to partners		—			(13,690	)		(9,425	)
Issuance of operating partnership units		—			26,304			30,000
Net income		(7	)		13,690			11,786
Redemption of limited partners common units for common shares		—			—			22,811
Balance at December 31, 2006		419			210,960			205,893
Distributions to partners		(3	)		(17,828	)		(10,512	)
Issuance of operating partnership units		—			99,964			—
Redemption of preferred units		—			(22,959	)		—
Net income		101			17,823			7,555
Redemption of limited partners common units for common shares		—			—			(82,104	)
Balance at December 31, 2007		517			287,960			120,832
Contributions from partners		130			—			176
Distributions to partners		—			(21,013	)		(10,131	)
Net income		483			21,012			6,669
Balance at December 31, 2008	$	1,130		$	287,959		$	117,546

Common Units

The common units of the Operating Partnership not held by the Trust outstanding as of December 31, 2008 have the same economic characteristics as common shares of the Trust. The common units share proportionately in the net income or loss and in any distributions of the Operating Partnership. The common units of the Operating Partnership not held by the Trust are redeemable at any time at the option of the holder. The Trust as the sole general partner of the Operating Partnership may at its option elect to settle the redemption in cash or through the exchange on a one-for-one basis with unregistered common shares of the Trust. The market value of the 4,074,967 common units based on the closing price of the shares of the Company at December 31, 2008 was $93.0 million.

During 2006, 684,432 common units were issued in connection with an acquisition. No common units were issued in connection with acquisitions during 2008 or 2007.

83

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	8/31/13 into Series B 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	12/12/15 into Series F Cumulative Redeemable Preferred Shares of the Trust
8/23/05	Series F	$	6,000		120	$	50		6.65	%	6/30/10	12/12/15 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
8/21/07	Series H	$	100,000		4,000	$	25		7.40	%	8/21/12	8/21/17 into Series H Cumulative Redeemable Preferred Shares of the Trust

The Preferred Units are callable at the Operating Partnership’s option after a stated period of time. The Trust is the sole general partner of the Operating Partnership may at its option elect to settle the redemption for cash or through the exchange on a one-on-one basis with unregistered preferred shares of the Trust.

During the year ended, December 31, 2007, the Company raised $100 million through the placement of 7.40% Series H Cumulative Redeemable Preferred Units.

During the year ended December 31, 2007, the Company redeemed for $23.7 million its outstanding 7.625% Series D Cumulative Redeemable Preferred Units. The redemption resulted in a $0.7 million write off of Series D issuance costs.

The Company paid the following Preferred Unit distributions for the year ended December 31:

	2008		2007		2006
Distributions (in millions)	$	21.0	$	17.1	$	13.7
Distribution per unit:
Series B	$	1.86	$	1.86	$	1.86
Series D	$	1.74	$	1.74	$	3.81
Series E	$	3.50	$	3.50	$	3.50
Series F	$	3.33	$	3.33	$	3.33
Series G	$	3.35	$	3.35	$	0.16
Series H	$	1.85	$	0.67		—

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.

The Company is obligated to make additional capital contributions to unconsolidated joint ventures of $3.8 million. The Company has not guaranteed any of the debt of the unconsolidated joint ventures.

The Company has letter of credit obligations of $2.0 million related to development requirements. It is remote that there will be a draw upon these letter of credit obligations.

84

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.

Litigation

The Company has been substituted for Republic as a party to certain litigation as a result of the Company’s acquisition of Republic on October 4, 2007. The litigation arises out of disputes between Republic and certain parties, two of whom were members of Republic’s Board of Trustees and “founders” of Republic. The disputes include claims arising from the termination of an officer of Republic (damages sought $1.8 million) and an attempt by Republic to acquire a certain office property from an entity controlled by the aforementioned related parties pursuant to an option agreement entered into at the time of Republic’s formation (damages sought $85.0 million compensatory and $85.0 million punitive). The Company believes that these claims are without merit and intends to defend itself vigorously against this litigation.

In accordance with SFAS No. 5 “Accounting for Contingencies,”the Company will record a provision for a liability when it is both probable that a liability has been incurred and the amount of loss can be reasonably estimated. Although the outcome of any litigation is uncertain, the Company believes that such legal actions will not have a material adverse affect on our consolidated financial condition, results of operations or cash flows.

10. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

A summary of quarterly results of operations for the years ended December 31, 2008 and 2007 follows. Certain amounts have been reclassified to conform to the current presentation of discontinued operations as of March 31, 2009 and the retrospective adoption of SFAS No. 160 (in thousands, except per share amounts).

	Quarter Ended
	Dec. 31,		Sept. 30,		June 30,		Mar. 31,		Dec. 31,		Sept. 30,		June 30,		Mar. 31,
	2008		2008		2008		2008		2007		2007		2007		2007
Operating revenue	$	188,527	$	185,958	$	182,053	$	189,470	$	184,621	$	173,293	$	165,319	$	161,652
Income from continuing operations		48,839		34,844		34,767		34,891		31,074		36,865		39,299		39,545
Discontinued operations		10,540		11,109		3,611		1,505		11,395		6,248		20,025		5,859
Net Income		29,379		45,953		38,378		36,396		42,469		43,113		59,324		45,404
Income per common unit — basic (1)		0.53		0.41		0.34		0.33		0.39		0.41		0.57		0.44
Income per common unit — diluted (1)		0.53		0.41		0.34		0.33		0.39		0.41		0.57		0.43

(1) The sum of quarterly financial data may vary from the annual data due to rounding.

85

11. SEGMENT INFORMATION

The Company operates its portfolio of properties primarily throughout the Mid-Atlantic, Southeastern, Midwestern and Southwestern 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
Northeast	Southeastern PA; Lehigh/Central PA; New Jersey
Midwest	Minnesota; Milwaukee; Chicago
Mid-Atlantic	Maryland; Carolinas; Richmond; Virginia Beach
South	Jacksonville; Orlando; Boca Raton; Tampa; Texas; Arizona
Philadelphia	Philadelphia; Northern Virginia/Washington, D.C.
United Kingdom	County of Kent; West Midlands

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.

During the year ended December 31, 2008, the Company began to report the results of the Arizona market as part of the “South” reportable segment rather than listing Arizona as its own reportable segment, as it had been presented in 2007. Also, the Company began to report the results of the Lehigh/Central PA market as part of the “Northeast” reportable segment rather than as part of the “Midwest” segment. The Company also began to report the results of certain operating properties containing 834,000 square feet in the “Philadelphia” reportable segment rather than as part of the New Jersey market in the “Northeast” reportable segment, as they had been presented in 2007. As required by SFAS No. 131 (“SFAS No. 131”) “Disclosures about Segments of an Enterprise and Related Information,” consolidated financial statements issued by the Company in the future will reflect modifications to the Company’s reportable segments resulting from the change described above, including reclassification of all comparative prior period segment information.

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, with restated amounts that reflect discontinued operations as of March 31, 2009 (in thousands):

YEAR ENDED DECEMBER 31, 2008

	Northeast
			Lehigh/
	Southeastern		Central		New								phila-		united
	PA		PA		Jersey		Midwest		mid-atlantic		South		delphia		kingdom		total
Operating revenue	$	178,507	$	96,906	$	38,004	$	82,964	$	142,543	$	173,319	$	29,426	$	4,339	$	746,008
Rental property expenses and real estate taxes		57,729		26,114		14,848		31,074		41,652		57,990		7,791		1,044		238,242
Property level operating income	$	120,778	$	70,792	$	23,156	$	51,890	$	100,891	$	115,329	$	21,635	$	3,295		507,766
Interest and other income																		13,501
Debt extinguishment gain																		2,521
Interest expense																		(155,198	)
General and administrative																		(54,387	)
Depreciation and amortization																		(172,594	)
Income before property dispositions, income taxes and equity in earnings of unconsolidated joint ventures																		141,609
Gain on property dispositions																		10,572
Income taxes																		(1,645	)
Equity in earnings of unconsolidated joint ventures																		2,805
Discontinued operations																		26,765
Net income																	$	180,106

86

YEAR ENDED DECEMBER 31, 2007

	Northeast
	Southeastern		Lehigh/		New				mid-				phila-		united
	PA		Central PA		Jersey		Midwest		atlantic		South		delphia		kingdom		total
Operating revenue	$	172,142	$	89,685	$	36,162	$	80,926	$	128,599	$	150,693	$	23,963	$	2,715	$	684,885
Rental property expenses and real estate taxes		56,950		22,886		9,228		28,061		38,524		50,419		9,378		33		215,479
Property level operating income	$	115,192	$	66,799	$	26,934	$	52,865	$	90,075	$	100,274	$	14,585	$	2,682		469,406
Interest and other income																		11,720
Interest expense																		(126,707	)
General and administrative																		(54,334	)
Depreciation and amortization																		(155,248	)
Income before property dispositions, income taxes and equity in loss of unconsolidated joint ventures																		144,837
Gain on property dispositions																		1,463
Income taxes																		709
Equity in loss of unconsolidated joint ventures																		(226	)
Discontinued operations																		43,527
Net income																	$	190,310

YEAR ENDED DECEMBER 31, 2006

	Northeast
	Southeastern		Lehigh/		New								phila-		united
	PA		Central PA		Jersey		Midwest		mid-atlantic		South		delphia		kingdom		total
Operating revenue	$	168,227	$	82,107	$	34,584	$	75,966	$	114,593	$	113,347	$	15,829	$	1,167	$	605,820
Rental property expenses and real estate taxes		54,181		19,885		8,128		26,752		33,925		36,822		6,913		261		186,867
Property level operating income	$	114,046	$	62,222	$	26,456	$	49,214	$	80,668	$	76,525	$	8,916	$	906		418,953
Interest and other income																		8,690
Interest expense																		(109,265	)
General and administrative																		(46,358	)
Depreciation and amortization																		(131,822	)
Income before property dispositions, income taxes and equity in earnings of unconsolidated joint ventures																		140,198
Gain on property dispositions																		17,628
Income taxes																		(288	)
Equity in earnings of unconsolidated joint ventures																		1,432
Discontinued operations																		133,073
Net income																	$	292,043

87

Product Type Information

	Real Estate Related Revenues
	Year Ended December 31,
	2008		2007		2006
Industrial	$	299,581	$	274,404	$	253,222
Office		446,427		410,481		352,598
Total operating revenue	$	746,008	$	684,885	$	605,820

ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT

	Northeast
	Southeastern			Lehigh/								Mid-						Phila-			United
	PA			Central PA		New Jersey			Midwest			Atlantic			South			Delphia			Kingdom (1)			Total
January 1, 2008	$	1,103,372		$	676,963	$	199,662		$	543,445		$	965,546		$	1,190,232		$	470,548		$	51,532		$	5,201,300
Additions		40,599			76,621		22,763			7,319			50,811			109,111			7,729			(13,119	)		301,834
Dispositions		(23,232	)		—		(10,921	)		(8,928	)		(15,338	)		(3,300	)		(367,897	)		—			(429,616	)
December 31, 2008	$	1,120,739		$	753,584	$	211,504		$	541,836		$	1,001,019		$	1,296,043		$	110,380		$	38,413			5,073,518
Accumulated depreciation																									(982,114	)
Development in progress																									245,463
Land held for development																									209,551
Assets held for sale																									33,662
Other assets																									636,955
Total assets at December 31, 2008																								$	5,217,035

ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT

	Northeast
				Lehigh/
	Southeastern			Central														Phila		United
	PA			PA			New Jersey		Midwest			Mid-Atlantic			South			-Delphia		Kingdom (1)		Total
January 1, 2007	$	1,048,142		$	582,475		$	112,397	$	699,585		$	861,863		$	953,808		$	103,008	$	11,435	$	4,372,713
Additions		67,645			103,750			87,265		64,050			114,274			245,317			367,540		40,097		1,089,938
Dispositions		(12,415	)		(9,262	)		—		(220,190	)		(10,591	)		(8,893	)		—		—		(261,351	)
December 31, 2007	$	1,103,372		$	676,963		$	199,662	$	543,445		$	965,546		$	1,190,232		$	470,548	$	51,532		5,201,300
Accumulated depreciation																							(858,671	)
Development in progress																							316,985
Land held for development																							247,124
Assets held for sale																							36,908
Other assets																							700,291
Total assets at December 31, 2007																						$	5,643,937

(1) United Kingdom additions are impacted by foreign currency translation gain or loss.

88

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 as of March 31, 2009 are reflected in the consolidated statements of operations as discontinued operations. Prior year financial statements have been adjusted for discontinued operations as of March 31, 2009. The proceeds from dispositions of operating properties with no continuing involvement were $80.0 million and $369.5 million for the years ended December 31, 2008 and 2007, respectively.

Below is a summary of the results of operations of the properties disposed of through the respective disposition dates (in thousands):

	Year Ended December 31,
	2008			2007			2006
Revenues	$	15,814		$	45,283		$	87,281
Operating expenses		(6,232	)		(18,020	)		(31,725	)
Interest expense		(2,680	)		(7,308	)		(14,981	)
Depreciation and amortization		(3,656	)		(10,039	)		(20,122	)
Income before property dispositions	$	3,246		$	9,916		$	20,453

Included in the discontinued operations above are six properties totaling 296,000 square feet located in the Company’s Mid-Atlantic segment that were considered to be held for sale as of December 31, 2008 and five properties totaling 152,000 square feet located in the Company’s Northeast segment that were considered to be held for sale as of March 31, 2009.

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) to the sum of total net assets plus consolidated debt.

Asset Impairment

In accordance with SFAS No. 144, during the years ended December 31, 2008, 2007 and 2006, the Company recognized impairment losses of $3.1 million, $0.2 million and $4.2 million, respectively. The 2008 impairment loss of $3.1 million was recognized in the fourth quarter and was related to a 49,000 square foot operating property in the Midwest segment, a 110,000 square foot operating property in Southeastern PA and a 296,000 square foot portfolio of operating properties in the Mid-Atlantic segment. The 2007 impairment loss of $0.2 million was related to various land parcels. The 2006 impairment loss of $4.2 million was primarily related to a 352,000 square foot portfolio of operating properties in the Midwest segment. For the years ended December 31, 2008 and 2006, respectively, $3.1 million and $4.2 million in impairment related to properties sold or held for sale were included in the caption discontinued operations in the Company’s statement of operations. For the year ended December 31, 2007, $0.2 million in impairment was 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, 2008.

13. SUBSEQUENT EVENTS

In December 2008, the Company commenced the sale of Common Shares pursuant to a continuous offering program. From January 1, 2009 through May 19, 2009, the Company sold 6.0 million common shares through this program. The net proceeds from the offering of $121.7 million were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

During the period from January 1, 2009 through May 19, 2009, the Company closed on mortgages totaling $317.4 million bearing interest at an average rate of 7.1%. The mortgages encumber certain of the Company’s Properties in Operation. The net proceeds from these mortgages were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

89

During the period from January 1, 2009 through May 19, 2009, the Company repaid $20 million of 8.125% medium term unsecured notes, purchased $11.4 million of its 7.75% senior notes and $6.9 million of its 8.50% senior notes and repaid $238.6 million of its 7.75% senior unsecured notes.

In April 2009, the Company’s Board of Trustees approved the expansion of the Company’s continuous offering program. In addition to the original program, the expansion allows for the sale of an additional $150 million in common shares.

14.  Adjustments to Previously Filed Financial Statements

These consolidated financial statements have been updated to correct the Company’s accounting for redeemable noncontrolling interests, the adoption of SFAS No. 160, and discontinued operations as of March 31, 2009.

SFAS No. 160

Effective January 1, 2009, the Company adopted SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements — an amendment of ARB No. 51 (“SFAS No. 160”). SFAS No. 160 describes a noncontrolling interest, sometimes called a minority interest, as the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent. SFAS No. 160 establishes accounting and reporting standards that require, among other items: a) the ownership interests in subsidiaries held by parties other than the parent be presented in the consolidated balance sheets within equity but separate from the parent’s equity; b) the amount of consolidated net income in the consolidated statements of operations attributable to the parent and the noncontrolling interests be presented on the face of the consolidated statements of operations; and c) entities provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling holders. The presentation and disclosure requirements of SFAS No. 160 have been applied retrospectively for all periods presented in the accompanying consolidated balance sheets, statements of operations, statements of equity, and statements of cash flows. In addition, Note 8 includes expanded disclosures regarding the rights of the various equity holders and Notes 10 (unaudited) and 11 have been updated pursuant to the presentation requirements of SFAS No. 160.

The Company re-evaluated the requirements of EITF Topic D-98 “Classification and Measurement of Redeemable Securities” (Topic D-98”), with respect to the presentation within the equity section of its balance sheets for redeemable equity securities. Although the Company had classified these securities within Owner’s Equity in its previously issued consolidated financial statements, the Company has concluded that it is required to present these securities at their redemption value at each balance sheet date outside of Owner’s Equity. This adjustment affects only the balance sheet presentation of its equity accounts and has no impact on income or income per unit or on cash flows for any period presented. The table below summarizes the effects of the change on the equity accounts for the December 31, 2008 and December 31, 2007 consolidated balance sheets.

As of December 31, 2008
	As Reported		Adjustment			As Adjusted
Noncontrolling interest – preferred units	$	—	$	287,959		$	287,959
Noncontrolling interest – common units		—		117,546			117,546
Owner’s Equity
General partner’s equity – common units	$	1,956,735	$	(36,864	)	$	1,919,871
Limited partners’ equity – preferred units		287,959		(287,959	)		—
Limited partners’ equity – common units		80,682		(80,682	)		—
Total Owner’s equity	$	2,325,376	$	(405,505	)	$	1,919,871

As of December 31, 2007
	As Reported		Adjustment			As Adjusted
Noncontrolling interest – preferred units	$	—	$	287,960		$	287,960
Noncontrolling interest – common units		—		120,832			120,832
Owner’s Equity
General partner’s equity – common units	$	1,837,021	$	(36,688	)	$	1,800,333
Limited partners’ equity – preferred units		287,960		(287,960	)		—
Limited partners’ equity – common units		84,144		(84,144	)		—
Total Owner’s equity	$	2,209,125	$	(408,792	)	$	1,800,333

Discontinued Operations

The accompanying financial statements have also been updated to reflect for all periods presented the results of operations of five properties totaling 152,000 square feet in the Company’s Northeast segment that were considered to be held for sale as of March 31, 2009. These adjustments impacted the consolidated statements of operations, the income per common share disclosures in Note 2, the quarterly results of operations in Note 10 (unaudited), the segment disclosures in Note 11, and the discontinued operations disclosures in Note 12. The impact of these changes was to decrease income from continuing operations and increase income from discontinued operations by $684, $589, and $721 for the years ended December 31, 2008, 2007, and 2006, respectively, compared to the previously filed financial statements.

90

LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2008

								Cost
								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
1501 Perryman Road	Aberdeen, MD		—		5,813,324		18,874,059		5,148,782		5,816,839		24,019,325		29,836,164		1,386,798	2005	40 yrs.
2196 Avenue C	Allentown, PA		—		101,159		—		1,347,970		107,307		1,341,822		1,449,129		828,845	1980	40 yrs.
7437 Industrial Boulevard	Allentown, PA		—		717,488		5,022,413		3,000,614		726,651		8,013,864		8,740,515		3,041,759	1976	40 yrs.
7248 Industrial Boulevard	Allentown, PA		—		2,670,849		13,307,408		4,005,636		2,670,673		17,313,219		19,983,893		4,549,501	1988	40 yrs.
700 Nestle Way	Allentown, PA		—		3,473,120		—		20,041,174		4,174,970		19,339,324		23,514,294		5,383,054	1998	40 yrs.
7562 Penn Drive	Allentown, PA		—		269,614		844,069		213,047		269,614		1,057,116		1,326,730		322,567	1989	40 yrs.
7277 Williams Avenue	Allentown, PA		—		462,964		1,449,009		436,346		463,123		1,885,196		2,348,319		676,185	1989	40 yrs.
7355 Williams Avenue	Allentown, PA		—		489,749		1,658,091		314,252		489,749		1,972,343		2,462,092		584,331	1998	40 yrs.
794 Roble Road	Allentown, PA		—		1,147,541		6,088,041		1,183,790		1,147,541		7,271,832		8,419,373		2,282,296	1985	40 yrs.
8014 Industrial Boulevard	Allentown, PA		—		4,019,258		—		9,764,392		3,645,117		10,138,533		13,783,650		3,039,925	1999	40 yrs.
705 Boulder Drive	Allentown, PA		—		4,484,096		—		14,878,034		4,486,836		14,875,294		19,362,130		3,148,524	2001	40 yrs.
651 Boulder Drive	Allentown, PA		—		4,308,646		—		13,339,042		4,308,646		13,339,042		17,647,688		3,160,648	2000	40 yrs.
8150 Industrial Boulevard	Allentown, PA		—		2,564,167				8,906,935		2,571,466		8,899,637		11,471,103		1,920,198	2002	40 yrs.
8250 Industrial Boulevard	Allentown, PA		—		1,025,667				5,346,179		1,035,854		5,335,991		6,371,846		950,726	2002	40 yrs.
650 Boulder Drive	Allentown, PA		—		5,208,248				31,405,185		9,961,788		26,651,645		36,613,433		4,081,623	2002	40 yrs.
200 Boulder Drive	Allentown, PA		—		4,722,683		18,922,645		237,680		4,722,683		19,160,325		23,883,008		2,091,911	2004	40 yrs.
250 Boulder Drive	Allentown, PA		—		3,599,936		12,099,145		2,089,337		3,719,772		14,068,646		17,788,418		1,611,741	2004	40 yrs.
8400 Industrial Boulevard	Allentown, PA		—		6,725,948		—		27,118,534		7,534,937		26,309,546		33,844,483		1,409,375	2005	40 yrs.
400 Nestle Way	Allentown, PA		20,940,815		8,065,500		—		27,420,765		8,184,096		27,302,169		35,486,265		8,931,479	1997	40 yrs.
2202 Hanger Place	Allentown, PA		*		137,439		—		1,341,155		138,127		1,340,466		1,478,594		888,748	1981	40 yrs.
7339 Industrial Boulevard	Allentown, PA		*		1,187,776		—		6,971,256		1,197,447		6,961,585		8,159,032		2,491,805	1996	40 yrs.
6923 Schantz Spring Road	Allentown, PA		*		1,127,805		3,309,132		349,184		1,127,805		3,658,316		4,786,120		1,068,345	1993	40 yrs.
7165 Ambassador Drive	Allentown, PA		*		792,999		—		4,533,868		804,848		4,522,019		5,326,867		873,259	2002	40 yrs.
6560 Stonegate Drive	Allentown, PA		—		458,281		—		2,833,097		458,945		2,832,433		3,291,378		1,350,717	1989	40 yrs.
6370 Hedgewood Drive	Allentown, PA		—		540,795		—		3,744,192		541,459		3,743,528		4,284,987		1,694,468	1990	40 yrs.
6390 Hedgewood Drive	Allentown, PA		—		707,203		—		2,765,090		707,867		2,764,425		3,472,293		1,444,458	1990	40 yrs.
6330 Hedgewood Drive	Allentown, PA		—		531,268		—		4,920,859		532,047		4,920,080		5,452,127		2,638,382	1988	40 yrs.
6580 Snowdrift Road	Allentown, PA		—		388,328		—		3,355,897		389,081		3,355,145		3,744,225		1,711,345	1988	40 yrs.
6540 Stonegate Drive	Allentown, PA		—		422,042		—		3,893,307		422,730		3,892,620		4,315,349		2,033,216	1988	40 yrs.
974 Marcon Boulevard	Allentown, PA		—		143,500		—		2,536,742		144,248		2,535,995		2,680,242		1,432,744	1987	40 yrs.
964 Marcon Boulevard	Allentown, PA		—		138,816		—		2,114,065		139,480		2,113,401		2,252,881		1,211,949	1985	40 yrs.
764 Roble Road	Allentown, PA		—		141,069		—		876,165		141,746		875,488		1,017,234		491,466	1985	40 yrs.
3174 Airport Road	Allentown, PA		—		98,986		—		1,192,596		98,986		1,192,595		1,291,582		778,937	1979	40 yrs.
2201 Hanger Place	Allentown, PA		—		128,454		—		1,918,272		129,142		1,917,583		2,046,726		1,272,750	1987	40 yrs.
954 Marcon Boulevard	Allentown, PA		—		103,665		—		1,347,546		104,453		1,346,758		1,451,211		648,206	1981	40 yrs.
754 Roble Road	Allentown, PA		—		162,115		1,731,885		502,487		163,735		2,232,752		2,396,487		878,285	1986	40 yrs.
744 Roble Road	Allentown, PA		—		159,771		1,734,229		271,718		161,371		2,004,347		2,165,718		770,782	1986	40 yrs.
944 Marcon Boulevard	Allentown, PA		—		118,521		1,435,479		610,844		119,711		2,045,133		2,164,844		767,454	1986	40 yrs.
6520 Stonegate Drive	Allentown, PA		—		453,315		—		1,791,480		484,361		1,760,434		2,244,795		727,358	1996	40 yrs.
2041 Avenue C	Allentown, PA		—		213,599		1,095,217		83,135		213,879		1,178,072		1,391,951		412,984	1990	40 yrs.
7144 Daniels Drive	Allentown, PA		—		2,390,217		2,342,761		3,725,676		1,579,169		6,879,485		8,458,654		2,191,962	1975	40 yrs.
7620 Cetronia Road	Allentown, PA		—		1,091,806		3,851,456		366,017		1,093,724		4,215,555		5,309,279		1,567,236	1990	40 yrs.
6350 Hedgewood Drive	Allentown, PA		*		360,027		—		3,886,266		560,691		3,685,601		4,246,293		1,564,087	1989	40 yrs.
180,190 Cochrane Drive	Annapolis, MD		—		3,670,256		—		23,101,092		3,752,293		23,019,055		26,771,348		10,515,407	1988	40 yrs.
4606 Richlynn Drive	Belcamp, MD		—		299,600		1,818,861		712,787		299,600		2,531,649		2,831,249		597,538	1985	40 yrs.
1655 Valley Center Parkway	Bethlehem, PA		—		214,431		—		2,077,289		215,095		2,076,625		2,291,720		1,040,257	1993	40 yrs.
1455 Valley Center Parkway	Bethlehem, PA		—		670,290		—		3,920,812		545,172		4,045,930		4,591,102		1,904,321	1997	40 yrs.
1640 Valley Center Parkway	Bethlehem, PA		—		359,000		—		4,265,161		190,728		4,433,433		4,624,161		1,496,403	1996	40 yrs.
1650 Valley Center Parkway	Bethlehem, PA		—		359,000		—		2,221,482		188,896		2,391,586		2,580,482		1,039,490	1997	40 yrs.
1660 Valley Center Parkway	Bethlehem, PA		—		359,000		—		2,296,178		188,721		2,466,457		2,655,178		880,964	1998	40 yrs.
83 South Commerce Way	Bethlehem, PA		—		143,661		888,128		533,628		212,744		1,352,673		1,565,417		587,093	1989	40 yrs.
85 South Commerce Way	Bethlehem, PA		—		236,708		987,949		208,501		237,078		1,196,080		1,433,158		374,817	1989	40 yrs.
87 South Commerce Way	Bethlehem, PA		—		253,886		1,062,881		275,641		253,886		1,338,522		1,592,408		459,576	1989	40 yrs.
89 South Commerce Way	Bethlehem, PA		—		320,000		—		2,020,662		367,706		1,972,956		2,340,662		828,516	1998	40 yrs.
1525 Valley Center Parkway	Bethlehem, PA		—		475,686		—		7,754,839		804,104		7,426,421		8,230,525		2,341,241	1999	40 yrs.
74 West Broad Street	Bethlehem, PA		—		1,096,127				13,513,997		1,099,079		13,511,045		14,610,124		3,613,884	2002	40 yrs.
1605 Valley Center Parkway	Bethlehem, PA		—		729,751				11,118,924		1,766,196		10,082,479		11,848,675		2,546,868	2000	40 yrs.
3400 High Point Boulevard	Bethlehem, PA		—		298,227		—		3,053,506		662,809		2,688,924		3,351,733		531,758	2002	40 yrs.
3500 High Point Boulevard	Bethlehem, PA		—		289,529		—		4,451,571		916,280		3,824,820		4,741,100		280,248	2006	40 yrs.
3450 High Point Boulevard	Bethlehem, PA		—		303,197		—		4,244,190		918,473		3,628,915		4,547,388		87,174	2006	40 yrs.
1495 Valley Center Parkway	Bethlehem, PA		—		434,640		—		4,962,712		435,303		4,962,049		5,397,352		2,114,820	1990	40 yrs.
1550 Valley Center Parkway	Bethlehem, PA		—		196,954		—		4,189,791		197,700		4,189,045		4,386,745		1,757,816	1988	40 yrs.
1560 Valley Center Parkway	Bethlehem, PA		—		240,069		—		4,635,199		240,732		4,634,536		4,875,268		2,379,153	1988	40 yrs.
1510 Valley Center Parkway	Bethlehem, PA		—		312,209		—		3,808,228		312,873		3,807,563		4,120,437		1,953,445	1988	40 yrs.
1530 Valley Center Parkway	Bethlehem, PA		—		211,747		—		3,016,731		212,492		3,015,986		3,228,478		1,476,546	1988	40 yrs.
57 South Commerce Way	Bethlehem, PA		—		390,839		2,701,161		789,433		395,459		3,485,974		3,881,433		1,473,420	1986	40 yrs.
1685 Valley Center Parkway	Bethlehem, PA		—		244,029		—		2,429,110		198,482		2,474,657		2,673,139		1,003,460	1996	40 yrs.
6601-6625 W. 78th Street	Bloomington, MN		—		2,263,060		—		38,819,236		2,310,246		38,772,050		41,082,296		9,886,677	1998	40 yrs.
6161 Green Valley Drive	Bloomington, MN		—		740,378		3,311,602		701,685		709,961		4,043,704		4,753,665		951,437	1992	40 yrs.
10801 Nesbitt Avenue South	Bloomington, MN		—		784,577				4,105,182		786,382		4,103,377		4,889,759		1,238,848	2001	40 yrs.
5775 West Old Shakopee Road	Bloomington, MN		—		2,052,018		3,849,649		3,313,825		2,060,644		7,154,848		9,215,492		3,055,337	2002	40 yrs.
5715 Old Shakopee Road West	Bloomington, MN		—		1,263,226		2,360,782		2,476,073		1,264,758		4,835,323		6,100,081		1,255,310	2002	40 yrs.

91

								Cost
								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
5735 Old Shakopee Road West	Bloomington, MN		—		1,263,226		2,360,782		1,086,930		1,264,758		3,446,180		4,710,938		667,284	2002	40 yrs.
5705 Old Shakopee Road	Bloomington, MN		—		2,113,223		—		5,521,336		2,148,571		5,485,989		7,634,559		275,121	2001	40 yrs.
1701 Clint Moore Boulevard	Boca Raton, FL		—		1,430,884		3,043,553		1,316,677		1,430,937		4,360,178		5,791,114		1,145,888	1985	40 yrs.
951 Broken Sound Parkway	Boca Raton, FL		—		1,426,251		6,098,952		1,881,060		1,426,251		7,980,012		9,406,262		2,597,600	1986	40 yrs.
777 Yamato Road	Boca Raton, FL		—		4,101,247		16,077,347		5,811,125		4,501,247		21,488,473		25,989,719		6,441,664	1987	40 yrs.
1801 Clint Moore Road	Boca Raton, FL		—		1,065,068		4,481,644		686,050		1,065,068		5,167,695		6,232,763		1,615,765	1986	40 yrs.
860 Nestle Way	Breinigsville, PA		—		8,118,881		18,885,486		2,377,934		8,118,881		21,263,420		29,382,301		1,882,266	2004	40 yrs.
8201 Industrial Boulevard	Breinigsville, PA		—		2,089,719		—		8,333,883		2,226,432		8,197,170		10,423,602		412,396	2006	40 yrs.
400 Boulder Drive	Breinigsville, PA		*		—				13,408,721		2,865,575		10,543,146		13,408,721		1,157,345	2003	40 yrs.
602 Heron Drive	Bridgeport, NJ		—		524,728		2,240,478		7,650		524,728		2,248,128		2,772,856		603,754	1996	40 yrs.
245 Executive Drive	Brookfield, WI		—		577,067		5,197,903		4,071,582		577,067		9,269,485		9,846,552		2,463,373	1984	40 yrs.
15800 West Bluemound Road	Brookfield, WI		—		1,289,204		8,128,035		1,552,539		1,306,811		9,662,967		10,969,778		2,052,573	1994	40 yrs.
20800 Swenson Drive	Brookfield, WI		4,797,400		1,023,466		10,729,219		1,022,780		1,025,082		11,750,382		12,775,464		1,245,016	2005	40 yrs.
20825 Swenson Drive	Brookfield, WI		—		644,563		3,640,734		226,102		646,518		3,864,882		4,511,399		404,282	2006	40 yrs.
20935 Swenson Drive	Brookfield, WI		4,223,847		571,389		10,238,547		796,592		572,158		11,034,369		11,606,527		1,109,335	2005	40 yrs.
20700 Swenson Drive	Brookfield, WI		5,543,784		830,008		12,276,445		641,464		830,999		12,916,918		13,747,917		1,231,488	2005	40 yrs.
20975 Swenson Drive	Brookfield, WI		5,784,696		675,422		8,910,651		1,052,523		678,637		9,959,959		10,638,596		1,188,103	2005	40 yrs.
1485 W. Commerce Avenue	Carlisle, PA		—		4,249,868		13,886,039		840,856		4,253,027		14,723,737		18,976,764		1,422,465	2004	40 yrs.
3773 Corporate Parkway	Center Valley, PA		—		738,108				7,674,838		794,874		7,618,071		8,412,945		2,056,603	2001	40 yrs.
95 Kriner Road	Chambersburg, PA		—		8,695,501		—		28,510,384		9,407,871		27,798,014		37,205,885		146,890	2006	40 yrs.
1309 Executive Boulevard	Cheaspeake, VA		—		926,125				5,086,632		955,374		5,057,383		6,012,757		991,200	2001	40 yrs.
7 Carnegie Plaza	Cherry Hill, NJ		—		2,000,000		3,493,983		3,229,339		2,005,475		6,717,847		8,723,322		1,214,808	2004	40 yrs.
1305 Executive Boulevard	Chesapeake, VA		—		861,020				4,911,374		1,129,850		4,642,543		5,772,393		969,927	2002	40 yrs.
1313 Executive Boulevard	Chesapeake, VA		—		1,180,036				4,629,615		1,708,050		4,101,602		5,809,652		776,635	2002	40 yrs.
510 Independence Parkway	Chesapeake, VA		—		2,012,149		7,546,882		421,917		2,014,689		7,966,260		9,980,949		892,754	2005	40 yrs.
1301 Executive Boulevard	Chesapeake, VA		—		—		—		6,176,380		997,570		5,178,810		6,176,380		415,319	2005	40 yrs.
500 Independence Parkway	Chesapeake, VA		3,385,676		864,150		4,427,285		100,511		866,609		4,525,338		5,391,946		608,742	2004	40 yrs.
501 Independence Parkway	Chesapeake, VA		4,195,100		1,202,556		5,975,538		1,165,766		1,292,273		7,051,586		8,343,860		713,499	2005	40 yrs.
505 Independence Parkway	Chesapeake, VA		4,967,132		1,292,062		6,456,515		1,287,046		1,292,254		7,743,368		9,035,623		874,855	2005	40 yrs.
700 Independence Parkway	Chesapeake, VA		6,562,607		1,950,375		7,236,994		627,345		1,951,135		7,863,579		9,814,714		1,206,288	2004	40 yrs.
6230 Old Dobbin Lane	Colombia, MD		—		3,004,075		—		7,636,053		2,746,455		7,893,673		10,640,128		879,885	2004	40 yrs.
9101,9111,9115 Guilford Road	Columbia, MD		—		758,951		—		4,634,835		765,952		4,627,834		5,393,786		2,272,761	1984	40 yrs.
9125,9135,9145 Guilford Road	Columbia, MD		—		900,154		—		6,180,706		920,439		6,160,422		7,080,860		3,873,038	1983	40 yrs.
7178-80 Columbia Gateway	Columbia, MD		—		1,569,237		4,786,887		2,222,793		1,571,105		7,007,812		8,578,917		2,988,407	1987	40 yrs.
9770 Patuxent Woods Drive	Columbia, MD		—		341,663		3,033,309		1,323,686		341,663		4,356,995		4,698,658		1,227,401	1986	40 yrs.
9780 Patuxent Woods Drive	Columbia, MD		—		218,542		1,940,636		411,079		218,542		2,351,715		2,570,256		663,919	1986	40 yrs.
9790 Patuxent Woods Drive	Columbia, MD		—		243,791		2,164,094		328,903		243,791		2,492,997		2,736,787		813,025	1986	40 yrs.
9810 Patuxent Woods Drive	Columbia, MD		—		266,684		2,366,901		997,913		266,684		3,364,814		3,631,497		1,056,427	1986	40 yrs.
9800 Patuxent Woods Drive	Columbia, MD		—		299,099		2,654,069		535,352		299,099		3,189,421		3,488,521		1,016,848	1988	40 yrs.
9820 Patuxent Woods Drive	Columbia, MD		—		237,779		2,110,835		789,527		237,779		2,900,362		3,138,141		868,166	1988	40 yrs.
9830 Patuxent Woods Drive	Columbia, MD		—		296,262		2,628,933		899,462		296,262		3,528,395		3,824,658		906,195	1986	40 yrs.
9050 Red Branch Road	Columbia, MD		—		290,950		2,577,153		941,253		290,950		3,518,406		3,809,356		956,625	1972	40 yrs.
8945-8975 Guilford Road	Columbia, MD		—		2,428,795		7,493,740		1,700,856		2,427,065		9,196,326		11,623,391		2,606,842	1986	40 yrs.
6250 Old Dobbin Lane	Columbia, MD		—		958,105				3,681,791		1,295,000		3,344,897		4,639,897		828,694	2002	40 yrs.
6200 Old Dobbin Lane	Columbia, MD		—		958,105				3,742,985		1,295,000		3,406,090		4,701,090		751,338	2002	40 yrs.
6210 Old Dobbin Lane	Columbia, MD		—		958,105				3,931,442		1,307,300		3,582,247		4,889,547		869,611	2002	40 yrs.
6250 Old Dobbin Lane	Columbia, MD		—		958,105				3,869,631		1,599,259		3,228,478		4,827,737		603,986	2000	40 yrs.
9755 Patuxent Woods Drive	Columbia, MD		—		3,917,094		16,219,721		1,167,866		3,922,382		17,382,299		21,304,681		1,456,898	2006	40 yrs.
6220 Old Dobbin Lane	Columbis, MD		—		3,865,848		—		7,434,362		3,166,951		8,133,259		11,300,210		347,572	2006	40 yrs.
5150 International Drive	Cudahy, WI		—		739,673		5,108,025		250,327		741,858		5,356,167		6,098,024		755,510	2003	40 yrs.
1250 Hall Court	Deer Park, TX		2,983,023		829,570		4,778,327		47,398		831,611		4,823,685		5,655,296		272,813	2006	40 yrs.
170 Parkway West	Duncan, SC		—		598,348		3,643,756		126,879		598,918		3,770,065		4,368,983		315,732	2006	40 yrs.
190 Parkway West	Duncan, SC		—		551,663		3,463,858		111,209		552,211		3,574,519		4,126,730		325,727	2006	40 yrs.
265 Parkway East	Duncan, SC		—		901,444		5,751,389		18,391		902,374		5,768,850		6,671,224		592,047	2006	40 yrs.
285 Parkway East	Duncan, SC		—		975,433		6,149,465		39,409		976,393		6,187,914		7,164,307		723,255	2006	40 yrs.
3255 Neil Armstrong Boulevard	Eagan, MN		—		1,131,017		—		3,366,266		1,103,860		3,393,423		4,497,283		848,227	1998	40 yrs.
6321-6325 Bury Drive	Eden Prairie, MN		—		462,876		4,151,790		581,781		462,876		4,733,572		5,196,447		1,471,416	1988	40 yrs.
7660-7716 Golden Triangle Drive	Eden Prairie, MN		—		568,706		5,115,177		3,184,634		1,289,215		7,579,302		8,868,517		3,001,494	1988	40 yrs.
7400 Flying Cloud Drive	Eden Prairie, MN		—		195,982		1,762,027		959,527		754,062		2,163,474		2,917,536		547,299	1987	40 yrs.
10301-10305 West 70th Street	Eden Prairie, MN		—		120,622		1,085,226		321,867		118,300		1,409,415		1,527,715		363,556	1984	40 yrs.
10321 West 70th Street	Eden Prairie, MN		—		145,198		1,305,700		377,179		142,399		1,685,678		1,828,077		638,560	1984	40 yrs.
10333 West 70th Street	Eden Prairie, MN		—		110,746		995,868		93,888		108,610		1,091,892		1,200,502		364,395	1984	40 yrs.
10349-10357 West 70th Street	Eden Prairie, MN		—		275,903		2,481,666		449,591		270,584		2,936,576		3,207,160		936,102	1985	40 yrs.
10365-10375 West 70th Street	Eden Prairie, MN		—		291,077		2,618,194		364,782		285,464		2,988,589		3,274,053		959,256	1985	40 yrs.
10393-10394 West 70th Street	Eden Prairie, MN		—		269,618		2,423,318		785,407		264,419		3,213,924		3,478,343		973,584	1985	40 yrs.
7078 Shady Oak Road	Eden Prairie, MN		—		343,093		3,085,795		1,616,449		336,481		4,708,856		5,045,337		1,121,059	1985	40 yrs.
10400 Viking Drive	Eden Prairie, MN		—		2,912,391		—		23,353,685		2,938,372		23,327,703		26,266,076		7,312,972	1999	40 yrs.
7625 Smetana Lane	Eden Prairie, MN		—		4,500,641		—		2,987,800		1,916,609		5,571,833		7,488,442		335,245	2006	40 yrs.
7695-7699 Anagram Drive	Eden Prairie, MN		—		760,525		3,254,758		625,146		760,525		3,879,903		4,640,429		1,172,450	1997	40 yrs.
7800 Equitable Drive	Eden Prairie, MN		—		2,188,525		3,788,762		240,695		2,188,525		4,029,456		6,217,981		1,152,337	1993	40 yrs.
7905 Fuller Road	Eden Prairie, MN		—		1,229,862		4,075,167		2,051,136		1,230,965		6,125,200		7,356,165		1,369,000	1994	40 yrs.
9023 Columbine Road	Eden Prairie, MN		—		1,956,273		—		4,873,578		1,956,273		4,873,578		6,829,851		1,350,783	1999	40 yrs.
8967 Columbine Road	Eden Prairie, MN		—		1,450,000		—		3,575,107		1,450,000		3,575,107		5,025,107		920,084	2000	40 yrs.
7777 Golden Triangle Drive	Eden Prairie, MN		—		993,101		2,136,862		1,176,757		993,101		3,313,619		4,306,720		802,540	2000	40 yrs.
8937 Columbine Road	Eden Prairie, MN		—		1,325,829				4,287,274		1,739,966		3,873,137		5,613,103		873,485	2001	40 yrs.
7615 Smetana Lane	Eden Prairie, MN		—		1,011,517				8,665,025		3,000,555		6,675,988		9,676,542		1,756,942	2001	40 yrs.

92

								Cost
								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
8995 Columbine Road	Eden Prairie, MN		—		1,087,594				3,664,053		2,055,296		2,696,352		4,751,648		595,546	2001	40 yrs.
8911 Columbine Road (B2)	Eden Prairie, MN		—		916,687				3,608,469		1,718,407		2,806,748		4,525,156		535,211	2000	40 yrs.
8855 Columbine Road	Eden Prairie, MN		—		1,400,925				5,226,016		1,599,757		5,027,185		6,626,941		581,470	2000	40 yrs.
7075 Flying Cloud Drive	Eden Prairie, MN		—		10,232,831		10,855,851		53,337		10,243,977		10,898,042		21,142,019		500,941	2007	40 yrs.
7351 Coca Cola Drive	Elkridge, MD		—		1,897,044		—		7,048,446		3,023,417		5,922,074		8,945,491		224,957	2006	40 yrs.
180 Sheree Boulevard	Exton, PA		5,157,523		2,647,861		11,334,403		2,049,934		2,649,426		13,382,772		16,032,198		1,066,878	2007	40 yrs.
7028 Snowdrift Road	Fogelville, PA		—		520,473		959,279		292,813		524,390		1,248,175		1,772,565		371,902	1982	40 yrs.
420 Delaware Drive	Fort Washington, PA		—		2,766,931		—		8,290,888		2,826,994		8,230,825		11,057,819		571,917	2005	40 yrs.
414 Commerce Drive	Fort Washington, PA		—		1,267,194		2,217,460		307,900		1,267,937		2,524,616		3,792,553		231,189	2004	40 yrs.
275 Commerce Drive	Fort Washington, PA		—		1,775,894		2,160,855		7,433,770		1,790,041		9,580,478		11,370,519		142,837	2005	40 yrs.
1250 Virginia Drive	Fort Washington, PA		—		1,639,166		1,928,574		468,379		1,650,703		2,385,416		4,036,119		224,244	2005	40 yrs.
1100 Virginia Drive	Fort Washington, PA		—		22,612,437		—		55,809,125		23,339,943		55,081,619		78,421,562		2,007,575	2006	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		915,103	2006	40 yrs.
106 Southchase Boulevard	Fountain Inn, SC		—		201,944		—		5,133,389		684,003		4,651,330		5,335,333		358,667	2005	40 yrs.
9601 Cosner Drive	Fredericksburg, VA		—		475,262		3,917,234		214,221		475,262		4,131,454		4,606,716		1,391,089	1995	40 yrs.
200 W Cypress Creek Road	Ft Lauderdale, FL		—		3,414,989		2,399,738		10,524,649		3,414,989		12,924,387		16,339,376		1,924,698	2003	40 yrs.
5410 - 5430 Northwest 33rd Avenue	Ft. Lauderdale, FL		—		603,776		4,176,238		1,156,270		625,111		5,311,174		5,936,284		1,660,664	1985	40 yrs.
6500 NW 12th Avenue	Ft. Lauderdale, FL		—		7,099		3,046,309		475,723		—		3,529,130		3,529,130		1,143,136	1989	40 yrs.
6600 NW 12th Avenue	Ft. Lauderdale, FL		—		7,102		3,047,462		772,549		—		3,827,114		3,827,114		1,136,170	1989	40 yrs.
4880 Cox Road	Glen Allen, VA		—		743,898		4,499,807		3,058,575		743,898		7,558,382		8,302,280		1,840,837	1995	40 yrs.
5000 Cox Road	Glen Allen, VA		—		770,214		3,685,248		315,413		771,029		3,999,846		4,770,875		1,331,758	1990	40 yrs.
5500 Cox Road	Glen Allen, VA		—		443,485		—		3,546,671		483,263		3,506,893		3,990,156		1,152,858	1999	40 yrs.
4801 Cox Road	Glen Allen, VA		—		1,072,896		—		10,198,472		1,075,620		10,195,748		11,271,368		3,297,151	1998	40 yrs.
4198 Cox Road	Glen Allen, VA		—		670,292		3,839,245		1,241,555		670,292		5,080,800		5,751,092		1,645,466	1984	40 yrs.
4510 Cox Road	Glen Allen, VA		—		1,010,024		7,151,729		1,907,500		1,010,044		9,059,209		10,069,253		3,108,655	1990	40 yrs.
4121 Cox Road	Glen Allen, VA		—		1,083,006		6,035,653		952,101		1,083,006		6,987,754		8,070,760		955,534	2004	40 yrs.
200 Southchase Boulevard	Greenville, SC		—		512,911				6,273,615		515,542		6,270,984		6,786,525		792,280	2003	40 yrs.
45 Brookfield Oaks Drive	Greenville, SC		—		818,114		—		3,549,097		825,529		3,541,682		4,367,212		118,418	2006	40 yrs.
116 Pleasant Ridge Road	Greenville, SC		—		1,547,811		—		13,298,582		3,712,683		11,133,710		14,846,393		131,493	2006	40 yrs.
7 Research Drive	Greenville, SC		—		—		17,091,882		4,405		—		17,096,287		17,096,287		752,159	2007	40 yrs.
1487 South Highway 101	Greer, SC		—		464,237		—		5,136,776		1,301,738		4,299,275		5,601,012		13,817	2007	40 yrs.
1 Enterprise Parkway	Hampton, VA		—		974,675		5,579,869		1,433,088		974,675		7,012,957		7,987,632		2,255,340	1987	40 yrs.
22 Enterprise Parkway	Hampton, VA		—		1,097,368		6,760,778		1,257,471		1,097,368		8,018,248		9,115,617		2,462,312	1990	40 yrs.
5 Manhattan Square	Hampton, VA		—		207,368		—		1,663,695		212,694		1,658,368		1,871,063		543,765	1999	40 yrs.
1317 Executive Boulevard	Hampton, VA		—		1,650,423		—		7,668,631		1,128,829		8,190,225		9,319,054		348,381	2006	40 yrs.
21 Enterprise Parkway	Hampton, VA		—		263,668		8,167,118		382,338		265,719		8,547,405		8,813,124		1,848,003	1999	40 yrs.
521 Butler Farm Road	Hampton, VA		—		750,769		2,911,149		261,271		710,486		3,212,702		3,923,188		464,095	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		570,967	1983	40 yrs.
600 Industrial Drive	Harrisburg, PA		—		7,743,800		—		28,472,202		9,368,557		26,847,444		36,216,001		1,554,062	2005	40 yrs.
500 McCarthy Drive	Harrisburg, PA		—		5,194,872		19,991,436		4,234,765		5,687,013		23,734,060		29,421,073		3,011,485	2005	40 yrs.
4170 Mendenhall Oaks Parkway	High Point , NC		—		143,699		—		2,210,943		373,502		1,981,140		2,354,642		655,531	1999	40 yrs.
4180 Mendenhall Oaks Parkway	High Point , NC		—		121,329		—		1,835,505		315,614		1,641,220		1,956,834		584,926	1999	40 yrs.
4050 Piedmont Parkway	High Point , NC		—		801,902		—		20,721,590		2,042,159		19,481,334		21,523,492		5,353,041	1998	40 yrs.
4523 Green Point Drive	High Point, NC		—		234,564		—		3,109,110		235,698		3,107,976		3,343,674		1,269,229	1988	40 yrs.
4501 Green Point Drive	High Point, NC		—		319,289		—		2,606,925		320,450		2,605,765		2,926,214		1,303,596	1989	40 yrs.
4500 Green Point Drive	High Point, NC		—		230,622		—		2,310,319		231,692		2,309,249		2,540,941		1,196,924	1989	40 yrs.
2427 Penny Road	High Point, NC		—		1,165,664		—		3,476,301		655,240		3,986,724		4,641,965		1,791,684	1990	40 yrs.
4524 Green Point Drive	High Point, NC		—		182,810		—		2,396,132		183,888		2,395,053		2,578,942		1,194,991	1989	40 yrs.
4344 Federal Drive	High Point, NC		—		484,001		—		2,780,986		173,623		3,091,365		3,264,988		1,223,712	1996	40 yrs.
4000 Piedmont Parkway	High Point, NC		—		592,885		4,825,615		929,937		597,368		5,751,069		6,348,438		2,122,813	1989	40 yrs.
4380 Federal Drive	High Point, NC		—		282,996		—		2,204,882		283,368		2,204,510		2,487,878		859,427	1997	40 yrs.
4388 Federal Drive	High Point, NC		—		143,661		—		1,210,692		132,655		1,221,699		1,354,353		492,073	1997	40 yrs.
4160 Mendenhall Oaks Parkway	High Point, NC		—		285,882		—		3,361,383		545,627		3,101,638		3,647,265		1,010,657	1998	40 yrs.
4194 Mendenhall Oaks Parkway	High Point, NC		—		102,372		—		2,619,333		265,991		2,455,714		2,721,705		830,855	1999	40 yrs.
4196 Mendenhall Oaks Parkway	High Point, NC		—		66,731		—		2,510,094		173,889		2,402,936		2,576,825		857,473	1999	40 yrs.
4300 Federal Drive	High Point, NC		—		264,038		—		2,098,260		276,038		2,086,260		2,362,298		472,345	1998	40 yrs.
4135 Mendenall Oaks Parkway	High Point, NC		—		499,500		—		3,498,674		500,980		3,497,193		3,998,174		863,928	2000	40 yrs.
1498 Eagle Hill Drive	High Point, NC		—		94,274		—		5,933,606		791,880		5,235,999		6,027,879		220,175	2005	40 yrs.
4183 Eagle Hill Drive	High Point, NC		—		122,203				3,911,210		526,266		3,507,147		4,033,413		1,389,311	2001	40 yrs.
4189 Eagle Hill Drive	High Point, NC		—		100,106				3,430,006		431,106		3,099,006		3,530,112		888,462	2001	40 yrs.
4020 Meeting Way	High Point, NC		—		94,232				1,682,549		378,101		1,398,680		1,776,781		377,882	2001	40 yrs.
1400 Mendenhall Oaks Parkway	High Point, NC		—		172,320				7,281,025		984,672		6,468,673		7,453,345		1,437,607	2002	40 yrs.
4191 Mendenhall Oaks Parkway	High Point, NC		—		217,943				3,114,814		611,166		2,721,590		3,332,756		587,303	2002	40 yrs.
4015 Meeting Way	High Point, NC		—		510,000		—		2,787,760		511,869		2,785,890		3,297,759		296,429	2003	40 yrs.
4195 Eagle Hill Drive	High Point, NC		—		107,586		—		3,425,118		505,700		3,027,005		3,532,705		307,026	2004	40 yrs.
400 Mendenhall Oaks Parkway	High Point, NC		—		—		—		1,859,604		665,239		1,194,365		1,859,604		80,912	2004	40 yrs.
4475 Premier Drive	High Point, NC		—		748,693		—		5,888,692		1,525,421		5,111,964		6,637,385		86,535	2006	40 yrs.
4328, 4336 Federal Drive	High Point, NC		3,977,231		521,122		—		7,300,519		825,092		6,996,548		7,821,641		3,907,767	1995	40 yrs.
100 Witmer Road	Horsham, PA		—		3,102,784		—		18,701,183		3,764,784		18,039,184		21,803,967		3,510,902	1996	40 yrs.
132 Welsh Road	Horsham, PA		—		1,333,642		—		4,692,880		1,408,041		4,618,480		6,026,521		1,665,412	1998	40 yrs.
300 Welsh Road — Building 3	Horsham, PA		—		180,459		1,441,473		375,923		180,459		1,817,396		1,997,855		664,949	1983	40 yrs.
300 Welsh Road — Building 4	Horsham, PA		—		282,493		2,256,508		1,843,483		282,493		4,099,990		4,382,483		1,340,245	1983	40 yrs.
2 Walnut Grove Drive	Horsham, PA		—		1,281,870		7,767,374		1,961,590		1,265,363		9,745,470		11,010,834		3,415,954	1989	40 yrs.
5 Walnut Grove Drive	Horsham, PA		—		1,065,951		—		10,117,753		1,939,712		9,243,992		11,183,704		2,280,276	2000	40 yrs.
200 Gibraltar Road	Horsham, PA		—		638,513		5,811,323		1,947,714		638,513		7,759,036		8,397,550		2,878,638	1990	40 yrs.
220 Gibraltar Road	Horsham, PA		—		629,944		5,733,228		1,455,917		629,944		7,189,145		7,819,089		2,644,772	1990	40 yrs.

93

								Cost
								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
240 Gibraltar Road	Horsham, PA		—		629,944		5,733,234		1,915,620		629,944		7,648,854		8,278,798		2,937,215	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		2,345,767	1986	40 yrs.
181-187 Gibraltar Road	Horsham, PA		—		360,549		3,259,984		787,154		360,549		4,047,138		4,407,687		1,336,533	1982	40 yrs.
104 Rock Road	Horsham, PA		—		330,111		2,981,669		594,916		330,111		3,576,586		3,906,696		941,454	1974	40 yrs.
123-135 Rock Road	Horsham, PA		—		292,360		2,411,677		2,409,782		393,019		4,720,800		5,113,819		1,162,452	1975	40 yrs.
111-159 Gibraltar Road	Horsham, PA		—		489,032		4,126,151		1,367,375		489,032		5,493,526		5,982,558		1,693,767	1981	40 yrs.
161-175 Gibraltar Road	Horsham, PA		—		294,673		2,663,722		987,299		294,673		3,651,020		3,945,694		1,105,985	1976	40 yrs.
103-109 Gibraltar Road	Horsham, PA		—		270,906		2,448,500		818,872		270,906		3,267,371		3,538,278		1,270,550	1978	40 yrs.
210-223 Witmer Road	Horsham, PA		—		270,282		2,441,276		1,940,611		270,282		4,381,887		4,652,169		1,282,445	1972	40 yrs.
100 Gibraltar Road	Horsham, PA		—		38,729		349,811		9,589		38,729		359,400		398,129		99,409	1975	40 yrs.
101 Gibraltar Road	Horsham, PA		—		651,990		5,888,989		1,561,435		732,552		7,369,862		8,102,414		2,305,103	1977	40 yrs.
506 Prudential Road	Horsham, PA		—		208,140		895,470		723,059		208,140		1,618,529		1,826,669		440,823	1973	40 yrs.
113-123 Rock Road	Horsham, PA		—		351,072		3,171,001		589,814		451,731		3,660,155		4,111,887		1,012,999	1975	40 yrs.
101-111 Rock Road	Horsham, PA		—		350,561		3,166,389		864,263		452,251		3,928,962		4,381,213		1,231,119	1975	40 yrs.
120 Gibraltar Road	Horsham, PA		—		533,142		4,830,515		2,416,512		558,142		7,222,027		7,780,169		1,897,838	1980	40 yrs.
110 Gibraltar Road	Horsham, PA		—		673,041		5,776,369		2,584,619		673,041		8,360,988		9,034,029		2,534,483	1979	40 yrs.
100-107 Lakeside Drive	Horsham, PA		—		239,528		2,163,498		712,712		255,528		2,860,210		3,115,738		976,181	1982	40 yrs.
200-264 Lakeside Drive	Horsham, PA		—		502,705		4,540,597		1,536,610		502,705		6,077,207		6,579,912		1,814,424	1982	40 yrs.
300-309 Lakeside Drive	Horsham, PA		—		369,475		3,338,761		1,842,034		376,475		5,173,795		5,550,270		1,986,944	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		2,476,732	1981	40 yrs.
201 Gibraltar Road	Horsham, PA		—		380,127		3,433,433		1,997,494		380,802		5,430,252		5,811,054		1,627,010	1983	40 yrs.
300 Welsh Road	Horsham, PA		—		696,061		3,339,991		570,429		696,061		3,910,420		4,606,480		1,115,040	1985	40 yrs.
700 Dresher Road	Horsham, PA		—		2,551,777		3,020,638		4,696,950		2,565,140		7,704,225		10,269,365		3,764,912	1987	40 yrs.
680 Blair Mill Road	Horsham, PA		—		3,527,151				17,434,151		4,138,577		16,822,725		20,961,302		3,116,684	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		662,819	1985	40 yrs.
335 Commerce Drive	Horsham, PA		—		—		—		8,757,475		182,400		8,575,075		8,757,475		1,064,979	2002	40 yrs.
255 Business Center Drive	Horsham, PA		—		1,154,289		2,007,214		573,608		1,140,597		2,594,513		3,735,111		391,690	2003	40 yrs.
355 Business Center Drive	Horsham, PA		—		483,045		898,798		253,426		471,171		1,164,098		1,635,270		243,111	2003	40 yrs.
455 Business Center Drive	Horsham, PA		—		1,351,011		2,503,449		1,927,940		1,322,317		4,460,083		5,782,400		1,031,964	2003	40 yrs.
555 Business Center Drive	Horsham, PA		—		727,420		1,353,650		194,047		709,967		1,565,151		2,275,118		345,712	2003	40 yrs.
7 Walnut Grove Drive	Horsham, PA		—		2,631,696		—		18,587,588		2,631,956		18,587,328		21,219,284		621,811	2006	40 yrs.
261-283 Gibraltar Road	Horsham, PA		*		464,871		3,951,972		1,775,341		464,871		5,727,312		6,192,183		1,216,076	1978	40 yrs.
231-237 Gibraltar Road	Horsham, PA		*		436,952		3,948,963		727,352		436,952		4,676,314		5,113,267		1,504,124	1981	40 yrs.
104 Witmer Road	Horsham, PA		*		1,248,148		—		1,133,749		189,793		2,192,104		2,381,897		931,792	1975	40 yrs.
719 Dresher Road	Horsham, PA		*		493,426		2,812,067		251,335		495,112		3,061,716		3,556,828		851,187	1987	40 yrs.
4 Walnut Grove	Horsham, PA		*		2,515,115		—		10,792,470		2,515,115		10,792,470		13,307,585		1,870,755	1999	40 yrs.
747 Dresher Road	Horsham, PA		—		1,607,238		—		5,193,398		1,607,977		5,192,658		6,800,636		2,713,953	1988	40 yrs.
507 Prudential Road	Horsham, PA		—		644,900		5,804,100		8,818,780		1,131,380		14,136,400		15,267,780		4,600,504	1988	40 yrs.
767 Electronic Drive	Horsham, PA		*		1,229,685		—		3,430,171		1,241,970		3,417,886		4,659,856		1,742,609	1996	40 yrs.
16445 Air Center Boulevard	Houston, TX		—		363,339		2,509,186		641,300		363,339		3,150,486		3,513,826		1,208,934	1997	40 yrs.
16405 Air Center Boulevard	Houston, TX		—		438,853		3,030,396		438,371		438,853		3,468,766		3,907,619		1,057,848	1997	40 yrs.
16580 Air Center Boulevard	Houston, TX		—		289,000		3,559,857		269,417		289,000		3,829,274		4,118,275		1,055,346	1997	40 yrs.
1755 Trans Central Drive	Houston, TX		—		293,534		3,036,269		190,651		306,147		3,214,306		3,520,453		752,950	1999	40 yrs.
16680 Central Green Boulevard	Houston, TX		—		311,952		—		3,956,813		492,869		3,775,895		4,268,765		83,075	2001	40 yrs.
16605 Air Center Boulevard	Houston, TX		—		298,999				3,770,315		496,186		3,573,128		4,069,314		988,599	2002	40 yrs.
10739 West Little York Road	Houston, TX		—		797,931		5,950,894		321,145		799,560		6,270,410		7,069,970		1,161,015	1999	40 yrs.
10735 West Little York Road	Houston, TX		—		1,110,988		6,351,946		1,711,950		1,135,483		8,039,401		9,174,884		1,159,934	2000	40 yrs.
8801-19 & 8821-49 Fallbrook Drive	Houston, TX		—		2,290,001		15,297,141		1,590,836		2,290,002		16,887,976		19,177,978		2,452,452	2000	40 yrs.
16685 Air Center Boulevard	Houston, TX		—		—		—		2,935,268		414,691		2,520,577		2,935,268		339,028	2004	40 yrs.
8825-8839 N Sam Houston Pkwy	Houston, TX		—		638,453		3,258,815		565,588		638,477		3,824,378		4,462,856		531,488	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		563,067	2004	40 yrs.
8802-8824 Fallbrook Drive	Houston, TX		—		1,114,406		6,364,767		2,636,014		2,775,021		7,340,166		10,115,187		1,029,169	2004	40 yrs.
16602 Central Green Boulevard	Houston, TX		—		284,403		—		4,495,522		503,779		4,276,146		4,779,925		356,764	2005	40 yrs.
1646 Rankin Road	Houston, TX		—		329,961		—		4,895,126		592,234		4,632,853		5,225,087		384,256	2005	40 yrs.
8301 Fallbrook Drive	Houston, TX		—		4,515,862		—		23,627,618		5,877,884		22,265,596		28,143,480		334,684	2006	40 yrs.
5200 N. Sam Houston Parkway	Houston, TX		—		1,519,458		7,135,548		2,697,458		1,520,074		9,832,389		11,352,464		332,982	2007	40 yrs.
5250 N. Sam Houston Parkway	Houston, TX		—		2,173,287		8,868,256		1,972,563		2,173,942		10,840,164		13,014,106		306,826	2007	40 yrs.
11201 Greens Crossing Boulevard	Houston, TX		—		1,006,194		5,412,584		2,705,102		1,008,542		8,115,337		9,123,879		229,320	2007	40 yrs.
850 Greens Parkway	Houston, TX		—		2,893,405		11,593,197		2,456,282		2,899,861		14,043,023		16,942,883		340,455	2007	40 yrs.
860 Greens Parkway	Houston, TX		—		1,399,365		6,344,650		1,528,602		1,374,012		7,898,606		9,272,618		193,441	2007	40 yrs.
20 Wright Avenue	Hunt Valley, MD		—		1,205,946		—		9,645,838		1,861,025		8,990,759		10,851,784		2,048,033	2001	40 yrs.
4 North Park Drive	Hunt Valley, MD		—		3,269,948		13,551,370		1,458,110		3,269,948		15,009,480		18,279,428		2,150,558	2003	40 yrs.
6 North Park Drive	Hunt Valley, MD		—		2,077,949		8,770,566		984,562		2,077,949		9,755,128		11,833,077		1,644,000	2003	40 yrs.
10 North Park Drive	Hunt Valley, MD		—		2,211,969		7,816,042		238,720		2,211,969		8,054,762		10,266,731		1,069,482	2003	40 yrs.
307 International Circle	Hunt Valley, MD		—		3,538,319		14,190,832		13,353,055		3,542,881		27,539,324		31,082,206		2,691,105	2004	40 yrs.
309 International Circle	Hunt Valley, MD		—		613,667		2,458,204		700,193		615,096		3,156,968		3,772,064		302,865	2004	40 yrs.
311 International Circle	Hunt Valley, MD		—		313,365		1,281,093		76,921		314,572		1,356,807		1,671,380		108,395	2004	40 yrs.
8775 Baypine Road	Jacksonville, FL		—		906,804		—		10,034,442		913,013		10,028,233		10,941,246		2,358,535	1989	40 yrs.
8665,8667,8669 Baypine Road	Jacksonville, FL		—		966,552		—		5,987,169		974,959		5,978,762		6,953,721		3,075,507	1987	40 yrs.
7970 Bayberry Road	Jacksonville, FL		—		127,520		—		1,391,397		129,979		1,388,938		1,518,917		1,104,987	1978	40 yrs.
7077 Bonneval Road	Jacksonville, FL		—		768,000		5,789,000		3,526,767		774,020		9,309,747		10,083,767		4,201,227	1988	40 yrs.
4190 Belfort Road	Jacksonville, FL		—		821,000		5,866,000		3,356,397		827,420		9,215,977		10,043,397		4,496,680	1986	40 yrs.
7020 AC Skinner Parkway	Jacksonville, FL		—		398,257		—		2,717,001		749,811		2,365,448		3,115,258		1,158,479	1996	40 yrs.
7022 AC Skinner Parkway	Jacksonville, FL		—		706,934		—		3,572,340		853,981		3,425,294		4,279,274		1,510,930	1996	40 yrs.
11777 Central Highway	Jacksonville, FL		—		92,207		429,997		1,275,050		140,426		1,656,828		1,797,254		1,127,183	1985	40 yrs.
4345 Southpoint Parkway	Jacksonville, FL		—		—		—		8,791,159		418,093		8,373,065		8,791,159		2,765,051	1998	40 yrs.

94

									Cost
									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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
7016 AC Skinner Parkway	Jacksonville, FL		—		597,181		—			2,373,250			602,633		2,367,799		2,970,431		1,140,862	1996	40 yrs.
7018 AC Skinner Parkway	Jacksonville, FL		—		840,996		—			4,694,026			846,461		4,688,561		5,535,022		2,186,102	1997	40 yrs.
7014 AC Skinner Parkway	Jacksonville, FL		—		574,198		—			3,580,008			780,486		3,373,720		4,154,206		1,385,190	1999	40 yrs.
6620 Southpoint Drive	Jacksonville, FL		—		614,602		4,267,477			1,017,166			614,602		5,284,642		5,899,245		1,858,105	1984	40 yrs.
7980 Bayberry Road	Jacksonville, FL		—		330,726		1,338,101			17,776			330,726		1,355,877		1,686,603		394,141	1978	40 yrs.
6600 Southpoint Parkway	Jacksonville, FL		—		998,432		4,055,727			828,152			1,002,704		4,879,607		5,882,311		1,750,059	1986	40 yrs.
6700 Southpoint Parkway	Jacksonville, FL		—		620,719		2,989,746			789,809			624,215		3,776,060		4,400,274		1,563,846	1987	40 yrs.
4801 Executive Park Court - 100	Jacksonville, FL		—		554,993		2,993,277			1,358,664			554,542		4,352,392		4,906,935		1,671,990	1990	40 yrs.
4801 Executive Park Court - 200	Jacksonville, FL		—		370,017		1,995,518			367,780			370,039		2,363,276		2,733,315		759,393	1990	40 yrs.
4810 Executive Park Court	Jacksonville, FL		—		369,694		3,045,639			1,007,513			370,039		4,052,807		4,422,846		1,281,897	1990	40 yrs.
6602 Executive Park Court - 100	Jacksonville, FL		—		388,519		2,095,293			299,475			388,541		2,394,745		2,783,287		790,611	1993	40 yrs.
6602 Executive Park Court - 200	Jacksonville, FL		—		296,014		1,596,347			453,476			296,032		2,049,805		2,345,837		645,669	1993	40 yrs.
6631 Executive Park Court - 100	Jacksonville, FL		—		251,613		1,356,849			525,120			251,627		1,881,955		2,133,582		791,232	1994	40 yrs.
6631 Executive Park Court - 200	Jacksonville, FL		—		406,561		2,195,070			274,915			407,043		2,469,503		2,876,546		817,142	1994	40 yrs.
4815 Executive Park Court - 100	Jacksonville, FL		—		366,317		1,975,393			409,677			366,339		2,385,048		2,751,387		876,448	1995	40 yrs.
4815 Executive Park Court - 200	Jacksonville, FL		—		462,522		2,494,397			512,344			462,549		3,006,713		3,469,263		1,049,949	1995	40 yrs.
4825 Executive Park Court	Jacksonville, FL		—		601,278		3,242,491			287,899			601,401		3,530,267		4,131,668		1,166,422	1996	40 yrs.
4820 Executive Park Court	Jacksonville, FL		—		555,173		2,693,130			777,785			555,213		3,470,875		4,026,088		1,111,648	1997	40 yrs.
6601 Executive Park Circle North	Jacksonville, FL		—		551,250		3,128,361			110,993			551,250		3,239,353		3,790,603		876,571	1992	40 yrs.
4901 Belfort Road	Jacksonville, FL		—		877,964		2,360,742			2,857,775			877,964		5,218,517		6,096,481		2,096,702	1986	40 yrs.
4875 Belfort Road	Jacksonville, FL		—		2,089,347		—			12,746,697			2,287,152		12,548,892		14,836,044		19,127	1998	40 yrs.
4899 Belfort Road	Jacksonville, FL		—		1,299,201		—			8,299,049			1,168,062		8,430,188		9,598,250		2,332,310	2000	40 yrs.
4905 Belfort Street	Jacksonville, FL		—		638,154		—			3,467,521			641,272		3,464,403		4,105,675		1,067,726	2000	40 yrs.
7251 Salisbury Road	Jacksonville, FL		—		—		—			3,567,820			662,559		2,905,261		3,567,820		883,202	2000	40 yrs.
10245 Centurion Parkway North	Jacksonville, FL		—		852,644		3,510,889			1,038,509			853,704		4,548,337		5,402,042		1,287,220	1996	40 yrs.
4887 Belfort Road	Jacksonville, FL		—		1,299,202					8,013,821			1,665,915		7,647,107		9,313,022		2,008,217	2002	40 yrs.
7255 Salisbury Road	Jacksonville, FL		—		392,060					2,975,677			680,766		2,686,971		3,367,737		700,627	2002	40 yrs.
5201 Gate Parkway	Jacksonville, FL		—		3,836,532		—			21,433,694			4,269,346		21,000,880		25,270,226		2,025,647	2005	40 yrs.
3200 Horizon Drive	King of Prussia, PA		—		928,637		—			7,121,324			1,210,137		6,839,824		8,049,961		2,905,022	1996	40 yrs.
440 East Swedesford Road	King of Prussia, PA		—		717,001		4,816,121			3,338,962			717,001		8,155,083		8,872,084		3,226,346	1988	40 yrs.
460 East Swedesford Road	King of Prussia, PA		—		705,317		4,737,487			4,321,549			705,317		9,059,036		9,764,353		2,487,896	1988	40 yrs.
151 South Warner Road	King of Prussia, PA		—		1,218,086		6,937,866			6,630,138			1,186,972		13,599,118		14,786,090		283,014	1980	40 yrs.
3604 Horizon Drive	King of Prussia, PA		—		397,178		—			1,628,625			350,874		1,674,929		2,025,803		750,858	1998	40 yrs.
3606 Horizon Drive	King of Prussia, PA		—		789,409		—			2,125,279			815,855		2,098,833		2,914,688		876,136	1997	40 yrs.
650 Swedesford Road	King of Prussia, PA		—		952,911		6,722,830			9,556,741			952,911		16,279,570		17,232,481		7,018,413	1971	40 yrs.
680 Swedesford Road	King of Prussia, PA		—		952,361		6,722,830			8,367,206			952,361		15,090,036		16,042,397		6,558,527	1971	40 yrs.
3600 Horizon Drive	King of Prussia, PA		—		236,432		1,856,252			784,645			236,432		2,640,897		2,877,328		758,733	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		677,108	1989	40 yrs.
2700 Horizon Drive	King of Prussia, PA		—		764,370		—			4,242,628			867,815		4,139,183		5,006,998		1,403,069	1998	40 yrs.
2900 Horizon Drive	King of Prussia, PA		—		679,440		—			3,503,074			774,096		3,408,418		4,182,514		1,096,966	1998	40 yrs.
2500 Renaissance Boulevard	King of Prussia, PA		—		509,580		—			2,866,474			592,886		2,783,167		3,376,054		1,104,642	1999	40 yrs.
2300 Renaissance Boulevard	King of Prussia, PA		—		509,580		—			3,042,297			574,152		2,977,725		3,551,877		958,737	1999	40 yrs.
2100 Renaissance Boulevard	King of Prussia, PA		—		1,110,111		—			9,339,057			1,132,519		9,316,649		10,449,169		3,018,221	1999	40 yrs.
3400 Horizon Drive	King of Prussia, PA		—		776,496		3,139,068			1,276,655			776,496		4,415,723		5,192,219		1,336,234	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		6,028,262	2002	40 yrs.
2520 Renaissance Boulevard	King of Prussia, PA		—		1,020,000		—			5,015,045			978,402		5,056,643		6,035,045		2,170,675	1999	40 yrs.
2201 Renaissance Boulevard	King of Prussia, PA		—		—		—			18,888,377			2,413,514		16,474,863		18,888,377		3,917,910	2000	40 yrs.
2540 Renaissance Boulevard	King of Prussia, PA		—		—		—			1,625,497			274,341		1,351,156		1,625,497		439,087	2000	40 yrs.
2560 Renaissance Boulevard	King of Prussia, PA		—		—		—			3,729,254			649,792		3,079,462		3,729,254		983,905	2000	40 yrs.
170 South Warner Road	King of Prussia, PA		—		547,800		3,137,400			3,987,694			458,232		7,214,662		7,672,894		3,544,518	1980	40 yrs.
190 South Warner Road	King of Prussia, PA		—		552,200		3,162,600			1,647,906			461,909		4,900,797		5,362,706		2,466,986	1980	40 yrs.
3500 Horizon Drive	King of Prussia, PA		—		1,204,839		—			2,630,229			1,223,875		2,611,193		3,835,068		827,303	1996	40 yrs.
3000 Horizon Drive	King of Prussia, PA		—		1,191,449		—			2,309,358			946,703		2,554,103		3,500,806		688,183	1997	40 yrs.
3100 Horizon Drive	King of Prussia, PA		*		601,956		—			2,068,047			611,436		2,058,568		2,670,003		842,426	1995	40 yrs.
11425 State Highway 225	LaPorte, TX		—		975,974		3,409,036			8,956			977,542		3,416,424		4,393,966		274,812	2006	40 yrs.
11503 State Highway 225	LaPorte, TX		—		2,561,931		9,779,023			22,961			2,566,047		9,797,868		12,363,915		627,449	2006	40 yrs.
7528 Walker Way	Lehigh Valley, PA		—		893,441		—			5,510,455			779,330		5,624,567		6,403,897		581,674	2004	40 yrs.
8500 Willard Drive	Lehigh, PA		—		6,398,815		—			21,593,357			7,640,417		20,351,755		27,992,172		238,144	2004	40 yrs.
8301 Industrial Boulevard	Lehigh, PA		—		11,249,550		—			44,324,333			11,254,716		44,319,167		55,573,883		3,543,014	2005	40 yrs.
31700 Research Park Drive	Madison Heights, MI		—		373,202		1,824,721			(158,513	)		373,203		1,666,207		2,039,410		474,553	1988	40 yrs.
31811 Sherman Avenue	Madison Heights, MI		—		207,599		1,179,010			(152,186	)		207,599		1,026,824		1,234,423		315,809	1983	40 yrs.
1201 East Whitcomb Avenue	Madison Heights, MI		—		302,567		1,213,232			(167,324	)		302,567		1,045,908		1,348,475		338,473	1980	40 yrs.
1901 Summit Tower Boulevard	Maitland, FL		—		6,078,791		12,348,567			2,270,262			6,083,206		14,614,415		20,697,621		3,698,818	1998	40 yrs.
45-67 Great Valley Parkway	Malvern, PA		—		795,143		—			4,196,561			795,831		4,195,873		4,991,704		2,393,329	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		10,408,833	1986	40 yrs.
27-43 Great Valley Parkway	Malvern, PA		—		448,775		—			2,545,542			449,447		2,544,870		2,994,317		1,684,414	1977	40 yrs.
1 Country View Road	Malvern, PA		—		400,000		3,600,000			1,004,647			406,421		4,598,226		5,004,647		1,810,575	1982	40 yrs.
200 Chesterfield Parkway	Malvern, PA		—		495,893		2,739,093			649,407			588,384		3,296,009		3,884,393		2,113,705	1989	40 yrs.
50 Morehall Road	Malvern, PA		—		849,576		—			13,051,932			1,337,076		12,564,432		13,901,508		5,256,060	1997	40 yrs.
1 Great Valley Parkway	Malvern, PA		—		419,460		3,792,570	��		330,704			419,460		4,123,273		4,542,734		1,272,070	1982	40 yrs.
5 Great Valley Parkway	Malvern, PA		—		684,200		6,181,661			1,594,348			684,200		7,776,009		8,460,209		2,367,337	1983	40 yrs.
1001 Cedar Hollow Road	Malvern, PA		—		1,436,814		—			16,097,184			1,676,470		15,857,528		17,533,998		6,046,629	1998	40 yrs.
3 Country View Road	Malvern, PA		—		814,278		—			4,946,433			1,128,881		4,631,830		5,760,711		1,237,565	1998	40 yrs.
425 Technology Drive	Malvern, PA		—		191,114		—			2,112,927			321,473		1,982,568		2,304,041		846,015	1998	40 yrs.
375 Technology Drive	Malvern, PA		—		191,114		—			2,018,620			234,922		1,974,811		2,209,734		812,215	1998	40 yrs.
45 Liberty Boulevard	Malvern, PA		—		4,380,221		—			15,314,868			4,749,748		14,945,341		19,695,089		5,592,198	1999	40 yrs.

95

								Cost
								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
100 Chesterfield Parkway	Malvern, PA		—		1,320,625		—		6,714,624		1,451,139		6,584,110		8,035,249		2,703,488	1998	40 yrs.
600 Chesterfield Parkway	Malvern, PA		—		2,013,750		—		8,255,848		2,171,080		8,098,519		10,269,598		2,977,313	1999	40 yrs.
700 Chesterfield Parkway	Malvern, PA		—		2,013,750		—		8,216,674		2,158,337		8,072,087		10,230,424		2,945,440	1999	40 yrs.
18 Great Valley Parkway	Malvern, PA		—		394,036		3,976,221		99,539		397,293		4,072,504		4,469,796		1,029,148	1980	40 yrs.
11 Great Valley Parkway	Malvern, PA		—		496,297		—		3,226,924		708,331		3,014,890		3,723,221		810,169	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		6,188,393	1989	40 yrs.
2 West Liberty Boulevard	Malvern, PA		—		5,405,041		—		11,635,939		5,405,042		11,635,938		17,040,980		1,218,933	2003	40 yrs.
10 Great Valley Parkway	Malvern, PA		—		823,540		1,341,376		315,887		832,244		1,648,558		2,480,802		250,709	2003	40 yrs.
10, 20 Liberty Boulevard	Malvern, PA		—		724,058		—		5,760,414		724,846		5,759,626		6,484,472		2,818,957	1985	40 yrs.
420 Lapp Road	Malvern, PA		—		1,054,418		—		7,140,197		1,055,243		7,139,372		8,194,615		3,580,383	1989	40 yrs.
14 Lee Boulevard	Malvern, PA		—		664,282		—		6,022,257		643,892		6,042,647		6,686,539		3,107,281	1988	40 yrs.
500 Chesterfield Parkway	Malvern, PA		—		472,364		—		3,323,124		519,742		3,275,746		3,795,488		1,804,871	1988	40 yrs.
300-400 Chesterfield Parkway	Malvern, PA		—		937,212		—		5,742,100		1,012,843		5,666,469		6,679,312		2,967,422	1988	40 yrs.
40 Valley Stream Parkway	Malvern, PA		—		322,918		—		3,282,210		325,775		3,279,352		3,605,128		1,678,712	1987	40 yrs.
50 Valley Stream Parkway	Malvern, PA		—		323,971		—		3,204,468		323,792		3,204,647		3,528,439		1,436,712	1987	40 yrs.
20 Valley Stream Parkway	Malvern, PA		—		465,539		—		5,835,528		466,413		5,834,654		6,301,067		3,318,987	1987	40 yrs.
257-275 Great Valley Parkway	Malvern, PA		—		504,611		—		5,192,928		505,458		5,192,081		5,697,539		3,345,868	1983	40 yrs.
300 Technology Drive	Malvern, PA		—		368,626		—		1,344,816		374,497		1,338,945		1,713,442		769,673	1985	40 yrs.
277-293 Great Valley Parkway	Malvern, PA		—		530,729		—		2,452,813		531,534		2,452,008		2,983,542		1,480,904	1984	40 yrs.
311 Technology Drive	Malvern, PA		—		397,131		—		2,911,205		397,948		2,910,388		3,308,336		1,616,977	1984	40 yrs.
7 Great Valley Parkway	Malvern, PA		—		176,435		—		5,105,230		177,317		5,104,349		5,281,665		3,183,485	1985	40 yrs.
55 Valley Stream Parkway	Malvern, PA		—		215,005		—		4,393,160		215,818		4,392,348		4,608,165		2,300,673	1983	40 yrs.
65 Valley Stream Parkway	Malvern, PA		—		381,544		—		7,203,727		382,361		7,202,910		7,585,271		4,415,881	1983	40 yrs.
508 Lapp Road	Malvern, PA		—		331,392		—		2,021,104		332,216		2,020,280		2,352,496		1,333,384	1984	40 yrs.
10 Valley Stream Parkway	Malvern, PA		—		509,075		—		3,142,498		509,899		3,141,674		3,651,573		1,876,084	1984	40 yrs.
333 Phoenixville Pike	Malvern, PA		—		523,530		—		3,109,124		524,230		3,108,424		3,632,654		1,735,696	1985	40 yrs.
30 Great Valley Parkway	Malvern, PA		—		128,126		—		385,634		128,783		384,977		513,760		330,693	1975	40 yrs.
77-123 Great Valley Parkway	Malvern, PA		—		887,664		—		5,989,734		888,359		5,989,039		6,877,398		3,817,572	1978	40 yrs.
205 Great Valley Parkway	Malvern, PA		—		1,368,259		—		10,951,703		1,369,003		10,950,959		12,319,962		7,311,132	1981	40 yrs.
12,14,16 Great Valley Parkway	Malvern, PA		—		130,689		—		1,560,924		128,767		1,562,846		1,691,613		1,010,537	1982	40 yrs.
155 Great Valley Parkway	Malvern, PA		—		625,147		—		2,627,280		626,068		2,626,359		3,252,427		1,682,215	1981	40 yrs.
510 Lapp Road	Malvern, PA		—		356,950		—		926,587		357,751		925,786		1,283,537		615,963	1983	40 yrs.
60 Morehall Road	Malvern, PA		—		865,424		9,285,000		5,003,181		884,974		14,268,631		15,153,605		7,616,738	1989	40 yrs.
5 Country View Road	Malvern, PA		—		785,168		4,678,632		1,056,753		786,235		5,734,318		6,520,553		2,238,508	1985	40 yrs.
75 Great Valley Parkway	Malvern, PA		233,819		143,074		—		888,076		143,811		887,338		1,031,150		639,417	1977	40 yrs.
7550 Meridian Circle	Maple Grove, MN		—		513,250		2,901,906		480,768		513,250		3,382,673		3,895,923		924,902	1989	40 yrs.
701A Route 73 South	Marlton, NJ		—		264,387		3,772,000		4,136,671		271,743		7,901,315		8,173,058		3,869,216	1987	40 yrs.
701C Route 73 South	Marlton, NJ		—		84,949		1,328,000		630,335		96,161		1,947,123		2,043,284		787,244	1987	40 yrs.
400 Lippincott Drive	Marlton, NJ		—		69,402				3,794,883		317,799		3,546,486		3,864,285		1,160,762	1999	40 yrs.
406 Lippincott Drive	Marlton, NJ		—		321,455		1,539,871		1,152,052		327,554		2,685,824		3,013,378		1,208,728	1990	40 yrs.
301 Lippincott Drive	Marlton, NJ		—		1,069,837		4,780,163		1,627,277		1,069,838		6,407,440		7,477,277		2,579,480	1988	40 yrs.
303 Lippincott Drive	Marlton, NJ		—		1,069,837		4,780,163		3,061,402		1,069,838		7,841,565		8,911,402		3,095,840	1988	40 yrs.
901 Route 73	Marlton, NJ		—		334,411		2,733,314		822,958		334,411		3,556,271		3,890,683		1,303,790	1985	40 yrs.
404 Lippincott Drive	Marlton, NJ		—		131,896		—		1,809,487		131,896		1,809,487		1,941,383		732,345	1997	40 yrs.
402 Lippincott Drive	Marlton, NJ		—		131,896		—		2,096,558		131,896		2,096,558		2,228,454		785,592	1997	40 yrs.
75 Brookfield Oaks Drive	Mauldin, SC		—		419,731		—		2,476,356		430,909		2,465,178		2,896,087		276,134	2003	40 yrs.
65 Brookfield Oaks Drive	Mauldin, SC		—		557,174		—		2,745,259		506,318		2,796,116		3,302,434		273,241	2004	40 yrs.
7800 N. 113th Street	Milwaukee, WI		—		1,711,964		6,847,857		417,823		1,711,964		7,265,680		8,977,644		2,144,918	1991	40 yrs.
11950 W. Lake Park Drive	Milwaukee, WI		—		391,813		2,340,118		597,682		394,938		2,934,675		3,329,613		962,505	1986	40 yrs.
11400 W. Lake Park Drive	Milwaukee, WI		—		439,595		2,357,904		352,646		443,101		2,707,044		3,150,145		678,300	1986	40 yrs.
11425 W. Lake Park Drive	Milwaukee, WI		—		382,256		2,350,619		978,198		385,305		3,325,768		3,711,073		1,301,393	1987	40 yrs.
11301 W. Lake Park Drive	Milwaukee, WI		—		614,477		2,626,456		123,888		619,465		2,745,357		3,364,821		679,473	1987	40 yrs.
11900 W. Lake Park Drive	Milwaukee, WI		—		347,853		2,396,887		1,077,279		350,628		3,471,392		3,822,020		1,219,789	1987	40 yrs.
11414 West Park Place	Milwaukee, WI		—		234,443				10,745,623		491,531		10,488,536		10,980,067		3,129,496	2001	40 yrs.
11520 West Calumet Road	Milwaukee, WI		—		341,698		1,527,548		78,494		341,698		1,606,042		1,947,740		372,203	1995	40 yrs.
12100 West Park Place	Milwaukee, WI		—		534,470		3,239,389		572,084		532,370		3,813,573		4,345,943		1,107,320	1984	40 yrs.
11100 West Liberty Drive	Milwaukee, WI		—		1,800,000				7,537,760		1,801,024		7,536,736		9,337,760		1,330,833	2003	40 yrs.
11050 West Liberty Drive	Milwaukee, WI		—		—		—		3,816,745		914,760		2,901,985		3,816,745		175,374	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		2,049,711	1996	40 yrs.
4600 Nathan Lane	Minneapolis, MN		—		1,063,558				6,683,083		1,038,197		6,708,444		7,746,641		2,184,719	2002	40 yrs.
12501 & 12701 Whitewater Drive	Minnegonka, MN		—		2,175,209		3,948,085		7,480,997		2,177,953		11,426,338		13,604,291		1,523,808	1986	40 yrs.
5600 & 5610 Rowland Road	Minnetonka, MN		—		828,650		7,399,409		2,154,498		829,263		9,553,293		10,382,557		3,528,882	1988	40 yrs.
5400-5500 Feltl Road	Minnetonka, MN		—		883,895		7,983,345		2,288,449		883,895		10,271,794		11,155,689		3,272,429	1985	40 yrs.
3400 Lakeside Drive	Miramar, FL		—		2,022,153		11,345,881		1,661,289		2,022,153		13,007,169		15,029,323		3,866,622	1990	40 yrs.
3450 Lakeside Drive	Miramar, FL		—		2,022,152		11,357,143		2,623,700		2,022,152		13,980,843		16,002,994		4,453,379	1990	40 yrs.
3350 SW 148th Avenue	Miramar, FL		—		2,960,511		—		19,988,526		2,980,689		19,968,347		22,949,037		5,995,017	2000	40 yrs.
324 Park Knoll Drive	Morrisville, NC		*		1,449,092		4,424,932		239,301		1,449,450		4,663,875		6,113,325		221,707	2007	40 yrs.
619 Distribution Drive	Morrisville, NC		*		1,031,430		5,655,167		406,756		1,031,685		6,061,668		7,093,353		273,517	2007	40 yrs.
627 Distribution Drive	Morrisville, NC		*		1,061,370		5,152,110		231,852		1,061,632		5,383,700		6,445,332		226,746	2007	40 yrs.
701 Distribution Drive	Morrisville, NC		*		1,300,889		5,313,226		206,727		1,301,211		5,519,632		6,820,842		230,736	2007	40 yrs.
330 Fellowship Road	Mount Laurel, NJ		—		3,730,570		—		15,782,675		3,758,270		15,754,975		19,513,245		118,386	2006	40 yrs.
300 Fellowship Road	Mt Laurel, NJ		—		—		—		7,350,519		1,098,904		6,251,616		7,350,519		838,722	2004	40 yrs.
302 Fellowship Road	Mt Laurel, NJ		—		1,512,120		—		2,931,388		539,060		3,904,448		4,443,507		356,761	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		1,731,986	2003	40 yrs.
350 Fellowship Road	Mt Laurel, NJ		—		2,960,159		1,449,611		4,555,353		2,970,687		5,994,436		8,965,123		397,053	2006	40 yrs.
4001 Leadenhall Road	Mt. Laurel, NJ		—		3,207,885		391,167		18,894,592		2,784,694		19,708,950		22,493,644		4,148,410	2002	40 yrs.

96

								Cost
								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
3000 Atrium Way	Mt. Laurel, NJ		—		500,000		4,500,000		5,049,174		512,018		9,537,156		10,049,174		4,500,007	1987	40 yrs.
11000, 15000 Commerce Parkway	Mt. Laurel, NJ		—		310,585		4,394,900		622,498		311,950		5,016,033		5,327,983		2,405,135	1985	40 yrs.
12000, 14000 Commerce Parkway	Mt. Laurel, NJ		—		361,800		3,285,817		968,639		362,855		4,253,401		4,616,256		1,746,377	1985	40 yrs.
16000, 18000 Commerce Parkway	Mt. Laurel, NJ		—		289,700		2,512,683		1,335,052		290,545		3,846,890		4,137,435		1,379,385	1985	40 yrs.
1300 Route 73 North	Mt. Laurel, NJ		—		449,400		3,074,850		2,152,136		450,558		5,225,828		5,676,386		1,991,748	1988	40 yrs.
6000 Commerce Parkway	Mt. Laurel, NJ		—		234,151		2,022,683		902,135		234,151		2,924,818		3,158,969		1,102,498	1985	40 yrs.
7000 Commerce Parkway	Mt. Laurel, NJ		—		260,014		2,236,684		428,261		260,014		2,664,945		2,924,959		947,137	1984	40 yrs.
8000 Commerce Parkway	Mt. Laurel, NJ		—		234,814		1,995,098		468,864		234,814		2,463,962		2,698,776		726,982	1983	40 yrs.
9000 Commerce Parkway	Mt. Laurel, NJ		—		286,587		2,474,820		999,069		286,587		3,473,888		3,760,476		1,235,450	1983	40 yrs.
1000 Briggs Road	Mt. Laurel, NJ		—		288,577		2,546,537		1,481,895		288,577		4,028,432		4,317,009		1,762,710	1986	40 yrs.
1020 Briggs Road	Mt. Laurel, NJ		—		494,334		—		3,166,630		569,184		3,091,781		3,660,964		1,022,257	1999	40 yrs.
2000 Crawford Place	Mt. Laurel, NJ		—		310,831		2,797,744		2,918,905		310,831		5,716,649		6,027,480		2,538,858	1986	40 yrs.
5000 Dearborn Court	Mt. Laurel, NJ		—		1,057,763		4,191,827		1,651,610		1,057,763		5,843,437		6,901,200		1,628,440	1988	40 yrs.
1001 Briggs Road	Mt. Laurel, NJ		—		701,705		3,505,652		2,139,294		701,705		5,644,946		6,346,652		2,407,293	1986	40 yrs.
1015 Briggs Road	Mt. Laurel, NJ		—		356,987		—		3,673,175		470,659		3,559,503		4,030,162		1,075,140	2000	40 yrs.
17000 Commerce Parkway	Mt. Laurel, NJ		—		144,515				3,457,069		144,515		3,457,069		3,601,584		962,620	2001	40 yrs.
1025 Briggs Road	Mt. Laurel, NJ		278,931		430,990		3,714,828		1,234,492		430,990		4,949,320		5,380,310		1,830,207	1987	40 yrs.
6 Terry Drive	Newtown, PA		—		622,029		2,228,851		1,023,137		622,205		3,251,811		3,874,016		1,175,053	1981	40 yrs.
550-590 Hale Avenue	Oakdale, MN		—		765,535		3,488,754		666,032		766,390		4,153,931		4,920,320		1,174,506	1996	40 yrs.
1879 Lamont Avenue	Odenton, MD		—		1,976,000		8,099,579		2,469,160		2,011,030		10,533,709		12,544,739		1,157,212	2004	40 yrs.
350 Winmeyer Avenue	Odenton, MD		—		1,778,400		7,289,165		1,867,935		1,809,927		9,125,573		10,935,500		958,092	2004	40 yrs.
9600 Satellite Boulevard	Orlando, FL		—		252,850		1,297,923		62,116		252,850		1,360,039		1,612,889		410,096	1989	40 yrs.
9700 Satellite Boulevard	Orlando, FL		—		405,362		1,146,546		350,999		405,362		1,497,545		1,902,907		472,552	1989	40 yrs.
1902 Cypress Lake Drive	Orlando, FL		—		523,512		3,191,790		1,027,641		538,512		4,204,431		4,742,943		1,349,433	1989	40 yrs.
9550 Satellite Boulevard	Orlando, FL		—		574,831		—		2,330,526		587,319		2,318,038		2,905,357		716,478	1999	40 yrs.
10511 & 10611 Satellite Boulevard	Orlando, FL		—		517,554		2,568,186		487,613		522,991		3,050,362		3,573,353		1,013,101	1985	40 yrs.
1400-1440 Central Florida Parkway	Orlando, FL		—		518,043		2,561,938		862,155		518,043		3,424,093		3,942,136		918,802	1962	40 yrs.
2216 Directors Row	Orlando, FL		—		453,918		2,572,202		30,979		453,918		2,603,181		3,057,099		686,270	1998	40 yrs.
2400 South Lake Orange Drive	Orlando, FL		—		385,964		—		2,409,102		642,427		2,152,639		2,795,066		498,346	2001	40 yrs.
6923 Lee Vista Boulevard	Orlando, FL		—		903,701		—		3,790,657		830,953		3,863,405		4,694,358		218,655	2006	40 yrs.
6501 Lee Vista Boulevard	Orlando, FL		—		903,701				5,560,142		925,671		5,538,172		6,463,843		1,024,755	2001	40 yrs.
2416 Lake Orange Drive	Orlando, FL		—		535,964				3,175,219		704,800		3,006,382		3,711,182		951,877	2002	40 yrs.
10771 Palm Bay Drive	Orlando, FL		—		664,605				2,362,814		685,383		2,342,035		3,027,419		416,722	2001	40 yrs.
10003 Satellite Boulevard	Orlando, FL		—		680,312		2,120,754		1,241,828		680,312		3,362,582		4,042,894		662,327	2003	40 yrs.
1090 Gills Drive	Orlando, FL		—		878,320		2,558,833		1,371,034		878,320		3,929,867		4,808,187		529,509	2003	40 yrs.
2202 Taft-Vineland Road	Orlando, FL		—		—		—		6,631,110		1,283,713		5,347,397		6,631,110		1,072,811	2004	40 yrs.
South Center Land-Phase II	Orlando, FL		—		838,853		—		4,084,539		767,953		4,155,440		4,923,392		298,526	2006	40 yrs.
7315 Kingspointe Parkway	Orlando, FL		—		1,931,697		6,388,203		2,135,046		1,932,004		8,522,943		10,454,946		1,287,196	2004	40 yrs.
2351 Investors Row	Orlando, FL		—		2,261,924		7,496,249		411,516		2,263,211		7,906,478		10,169,689		790,763	2004	40 yrs.
1950 Summit Park Drive	Orlando, FL		—		2,573,700		17,478,646		587,603		2,583,667		18,056,282		20,639,949		1,772,310	2005	40 yrs.
1958 Summit Park Drive	Orlando, FL		—		2,573,961		11,206,937		8,841,420		2,583,216		20,039,102		22,622,318		2,031,969	2005	40 yrs.
6200 Lee Vista Boulevard	Orlando, FL		—		1,423,584		6,399,510		65,322		1,435,301		6,453,115		7,888,416		543,837	2006	40 yrs.
7022 TPC Drive	Orlando, FL		—		1,443,510		6,845,559		572,022		1,457,286		7,403,806		8,861,092		625,097	2006	40 yrs.
7100 TPC Drive	Orlando, FL		—		1,431,489		7,948,341		576,378		1,445,807		8,510,400		9,956,207		576,967	2006	40 yrs.
7101 TPC Drive	Orlando, FL		—		1,553,537		5,301,499		777,653		1,570,863		6,061,826		7,632,689		436,743	2006	40 yrs.
851 Gills Drive	Orlando, FL		—		332,992		—		2,559,105		373,500		2,518,597		2,892,097		28,215	2006	40 yrs.
950 Gills Drive	Orlando, FL		—		443,989		—		2,496,959		464,800		2,476,148		2,940,948		28,432	2006	40 yrs.
1000 Gills Drive	Orlando, FL		—		415,906		—		2,700,326		435,400		2,680,832		3,116,232		36,577	2006	40 yrs.
8751 Skinner Court	Orlando, FL		—		1,009,532		—		5,452,988		1,075,437		5,387,083		6,462,520		50,479	2008	40 yrs.
2256 Taft-Vineland Road	Orlando, FL		—		467,296		—		2,494,666		825,673		2,136,290		2,961,963		237,098	2005	40 yrs.
8801 Tinicum Boulevard	Philadelphia, PA		—		2,474,031		—		43,598,952		125,087		45,947,896		46,072,983		15,252,548	1997	40 yrs.
3 Franklin Plaza	Philadelphia, PA		—		2,483,144		—		32,150,134		2,514,519		32,118,759		34,633,278		7,807,092	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		989,840	2003	40 yrs.
1 Crescent Drive	Philadelphia, PA		—		567,280		—		14,379,278		347,892		14,598,666		14,946,558		917,104	2004	40 yrs.
4775 League Island Boulevard	Philadelphia, PA		—		891,892		—		5,757,514		366,982		6,282,425		6,649,406		176,510	2006	40 yrs.
4410 E. Cotton Center Boulevard	Phoenix, AZ		—		4,758,484		10,559,563		4,222,270		4,765,172		14,775,144		19,540,317		224,278	2007	40 yrs.
4750 S. 44th Place	Phoenix, AZ		—		3,756,307		8,336,400		3,624,432		3,761,587		11,955,552		15,717,139		175,068	2007	40 yrs.
4435 E. Cotton Center Boulevard	Phoenix, AZ		—		1,910,584		1,954,020		2,167,338		1,911,045		4,120,898		6,031,943		127,251	2007	40 yrs.
4207 E. Cotton Center Boulevard	Phoenix, AZ		—		1,409,908		4,680,808		1,096,836		1,410,248		5,777,305		7,187,552		415,229	2007	40 yrs.
4217 E. Cotton Center Boulevard	Phoenix, AZ		—		4,831,925		10,045,599		2,015,623		4,833,088		12,060,059		16,893,147		598,710	2007	40 yrs.
4425 E. Cotton Center Boulvard	Phoenix, AZ		*		7,318,457		24,549,401		28,556		7,318,457		24,577,957		31,896,413		1,212,322	2007	40 yrs.
4415 E. Cotton Center Boulevard	Phoenix, AZ		*		1,749,957		3,767,213		6,137		1,749,957		3,773,350		5,523,308		260,492	2007	40 yrs.
4405 E. Cotton Center Boulevard	Phoenix, AZ		*		2,646,318		9,697,439		9,441		2,646,318		9,706,880		12,353,198		442,023	2007	40 yrs.
4313 E. Cotton Center Boulevard	Phoenix, AZ		*		3,895,539		16,724,283		1,399,749		3,895,539		18,124,032		22,019,571		913,104	2007	40 yrs.
4303 E. Cotton Center Boulvard	Phoenix, AZ		*		2,619,964		9,675,711		11,076		2,619,964		9,686,787		12,306,751		485,652	2007	40 yrs.
9801 80th Avenue	Pleasant Prairie, WI		—		1,692,077		7,934,794		337,495		1,689,726		8,274,640		9,964,366		2,019,026	1994	40 yrs.
2250 Hickory Road	Plymouth Meeting, PA		—		1,015,851		9,175,555		2,985,528		1,032,507		12,144,428		13,176,935		3,779,952	1985	40 yrs.
2905 Northwest Boulevard	Plymouth, MN		—		516,920		4,646,342		1,932,535		516,920		6,578,877		7,095,797		2,540,236	1983	40 yrs.
2800 Campus Drive	Plymouth, MN		—		395,366		3,554,512		1,165,443		395,366		4,719,955		5,115,321		1,724,869	1985	40 yrs.
2955 Xenium Lane	Plymouth, MN		—		151,238		1,370,140		508,272		151,238		1,878,412		2,029,650		739,900	1985	40 yrs.
2920 Northwest Boulevard	Plymouth, MN		—		392,026		3,433,678		661,796		384,235		4,103,265		4,487,500		1,329,439	1997	40 yrs.
14630-14650 28th Avenue North	Plymouth, MN		—		198,205		1,793,422		782,928		198,205		2,576,350		2,774,555		890,678	1978	40 yrs.
2800 Northwest Boulevard	Plymouth, MN		—		1,934,438		10,952,503		536,220		1,934,438		11,488,723		13,423,161		3,263,618	1995	40 yrs.
9600 54th Avenue	Plymouth, MN		—		332,317		3,077,820		1,020,792		332,317		4,098,612		4,430,929		1,432,032	1998	40 yrs.
1500 SW 5th Court	Pompano Beach, FL		—		972,232		3,892,085		404,585		972,232		4,296,671		5,268,902		1,230,523	1957	40 yrs.
1651 SW 5th Court	Pompano Beach, FL		—		203,247		811,093		129,136		203,247		940,230		1,143,477		336,929	1990	40 yrs.

97

								Cost
								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		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
1601 SW 5th Court	Pompano Beach, FL		—		203,247		811,093		402,780			203,247		1,213,873		1,417,120		427,797	1990	40 yrs.
1501 SW 5th Court	Pompano Beach, FL		—		203,247		811,093		34,991			203,247		846,085		1,049,332		246,654	1990	40 yrs.
1400 SW 6th Court	Pompano Beach, FL		—		1,157,049		4,620,956		422,912			1,157,049		5,043,868		6,200,917		1,436,541	1986	40 yrs.
1405 SW 6th Court	Pompano Beach, FL		—		392,138		1,565,787		206,898			392,138		1,772,685		2,164,823		519,497	1985	40 yrs.
595 SW 13th Terrace	Pompano Beach, FL		—		359,933		1,437,116		195,253			359,933		1,632,369		1,992,302		453,566	1984	40 yrs.
601 SW 13th Terrace	Pompano Beach, FL		—		164,413		655,933		119,530			164,413		775,463		939,875		280,108	1984	40 yrs.
605 SW 16th Terrace	Pompano Beach, FL		—		310,778		1,238,324		275,029			310,178		1,513,953		1,824,131		442,398	1965	40 yrs.
4300 Carolina Avenue	Richmond, VA		—		2,007,717		14,927,608		496,232			2,009,136		15,422,421		17,431,557		5,304,579	1985	40 yrs.
301 Hill Carter Parkway	Richmond, VA		—		659,456		4,836,010		93,935			659,456		4,929,945		5,589,401		1,673,276	1989	40 yrs.
5600-5626 Eastport Boulevard	Richmond, VA		—		489,941		3,592,900		335,023			489,941		3,927,923		4,417,864		1,439,202	1989	40 yrs.
5650-5674 Eastport Boulevard	Richmond, VA		—		644,384		4,025,480		244,746			644,384		4,270,226		4,914,610		1,618,808	1990	40 yrs.
5700 Eastport Boulevard	Richmond, VA		—		408,729		2,697,348		818,887			408,729		3,516,235		3,924,964		1,291,932	1990	40 yrs.
4101-4127 Carolina Avenue	Richmond, VA		—		310,854		2,279,597		578,738			310,854		2,858,335		3,169,189		965,450	1973	40 yrs.
4201-4261 Carolina Avenue	Richmond, VA		—		693,203		5,083,493		1,669,869			693,203		6,753,362		7,446,565		2,303,775	1975	40 yrs.
4263-4299 Carolina Avenue	Richmond, VA		—		256,203		2,549,649		1,968,381			256,203		4,518,030		4,774,233		1,452,966	1976	40 yrs.
4301-4335 Carolina Avenue	Richmond, VA		—		223,696		1,640,435		2,672,043			223,696		4,312,478		4,536,174		905,854	1978	40 yrs.
4337-4379 Carolina Avenue	Richmond, VA		—		325,303		2,385,557		1,627,330			325,303		4,012,887		4,338,190		1,560,157	1979	40 yrs.
4501-4549 Carolina Avenue	Richmond, VA		—		486,166		3,565,211		410,129			486,166		3,975,340		4,461,506		1,405,245	1981	40 yrs.
4551-4593 Carolina Avenue	Richmond, VA		—		474,360		3,478,646		759,624			474,360		4,238,270		4,712,630		1,362,082	1982	40 yrs.
4601-4643 Carolina Avenue	Richmond, VA		—		652,455		4,784,675		622,565			652,455		5,407,240		6,059,695		2,062,630	1985	40 yrs.
4645-4683 Carolina Avenue	Richmond, VA		—		404,616		2,967,187		1,247,671			404,616		4,214,858		4,619,474		1,942,146	1985	40 yrs.
4447-4491 Carolina Avenue	Richmond, VA		—		454,056		2,729,742		293,897			454,056		3,023,639		3,477,695		1,133,376	1987	40 yrs.
4401-4445 Carolina Avenue	Richmond, VA		—		615,038		4,510,272		397,983			615,038		4,908,255		5,523,293		1,728,465	1988	40 yrs.
2300 East Parham Road	Richmond, VA		—		221,947		1,011,088		2,443			221,947		1,013,531		1,235,478		393,834	1988	40 yrs.
5601-5659 Eastport Boulevard	Richmond, VA		—		705,660		—		4,880,177			720,100		4,865,737		5,585,837		1,927,568	1996	40 yrs.
5900 Eastport Boulevard	Richmond, VA		—		676,661		—		4,822,772			687,898		4,811,535		5,499,433		1,547,220	1997	40 yrs.
4717-4729 Eubank Road	Richmond, VA		—		449,447		3,294,697		746,131			452,263		4,038,011		4,490,274		1,555,342	1978	40 yrs.
4263F-N. Carolina Avenue	Richmond, VA		—		91,476		—		1,652,274			91,599		1,652,151		1,743,750		532,286	1975	40 yrs.
510 Eastpark Court	Richmond, VA		—		261,961		2,110,874		485,076			262,210		2,595,701		2,857,911		929,172	1989	40 yrs.
520 Eastpark Court	Richmond, VA		—		486,118		4,083,582		397,629			486,598		4,480,731		4,967,329		1,472,083	1989	40 yrs.
5701-5799 Eastport Boulevard	Richmond, VA		—		694,644		—		5,851,949			700,503		5,846,090		6,546,593		1,958,624	1998	40 yrs.
530 Eastpark Court	Richmond, VA		—		266,883		—		3,132,390			334,772		3,064,501		3,399,273		1,276,640	1999	40 yrs.
6000 Eastport Blvd	Richmond, VA		—		872,901		—		7,486,746			901,666		7,457,981		8,359,647		132,485	1997	40 yrs.
3829-3855 Gaskins Road	Richmond, VA		—		364,165		3,264,114		39,764			364,165		3,303,879		3,668,044		896,060	1988	40 yrs.
10800 Nuckols Boulevard	Richmond, VA		—		1,432,462		—		14,420,839			1,794,162		14,059,139		15,853,301		3,132,138	2000	40 yrs.
100 Westgate Parkway	Richmond, VA		—		1,140,648		101,824		8,411,249			1,456,084		8,197,637		9,653,721		1,688,941	2001	40 yrs.
200 Westgate Parkway	Richmond, VA		—		1,623,612				6,030,738			1,072,797		6,581,554		7,654,350		1,369,827	2002	40 yrs.
3900 Westerre Parkway	Richmond, VA		—		392,184		—		11,788,193			1,100,000		11,080,377		12,180,377		733,032	2005	40 yrs.
1001 Boulders Parkway	Richmond, VA		—		2,073,739		5,634,796		1,606,286			2,079,643		7,235,178		9,314,821		772,257	2005	40 yrs.
7400 Beaufont Springs Drive	Richmond, VA		—		808,581		7,273,850		1,076,495			810,743		8,348,182		9,158,925		849,550	2005	40 yrs.
1100 Boulders Parkway	Richmond, VA		—		1,276,936		12,052,192		1,391,680			1,280,662		13,440,146		14,720,808		1,107,762	2005	40 yrs.
2020 US Highway 301 South	Riverview, FL		—		1,233,639		13,608,485		109,898			1,233,800		13,718,223		14,952,022		929,938	2006	40 yrs.
6532 Judge Adams Road	Rock Creek, NC		—		354,903		—		3,694,306			399,988		3,649,221		4,049,209		1,182,063	1997	40 yrs.
6530 Judge Adams Road	Rock Creek, NC		—		305,821		—		4,808,367			335,061		4,779,126		5,114,187		1,133,828	1999	40 yrs.
6509 Franz Warner Parkway	Rock Creek, NC		—		360,494				2,829,679			372,494		2,817,679		3,190,173		703,751	2001	40 yrs.
8501 East Raintree Drive	Scottsdale, AZ		—		4,076,412		—		27,621,159			4,115,137		27,582,434		31,697,571		2,337,940	2005	40 yrs.
Renaissance Blvd & Hwy 20	Sturtevant, WI		—		2,484,450		—		21,261,491			2,487,293		21,258,647		23,745,940		896,554	2006	40 yrs.
6950 Harbor View Blvd	Suffolk, VA		—		929,844		—		6,209,197			794,848		6,344,194		7,139,041		531,978	2004	40 yrs.
6900 Harbor View Boulevard	Suffolk, VA		—		904,052		—		8,372,235			807,006		8,469,281		9,276,287		293,059	2006	40 yrs.
13650 NW 8th Street	Sunrise, FL		—		558,223		2,171,930		106,552			558,251		2,278,454		2,836,705		703,684	1991	40 yrs.
13630 NW 8th Street	Sunrise, FL		—		659,797		2,596,275		772,671			659,825		3,368,917		4,028,742		1,244,345	1991	40 yrs.
1301 International Parkway	Sunrise, FL		—		5,100,162		24,219,956		7,393,483			5,100,791		31,612,809		36,713,600		1,335,884	2006	40 yrs.
13621 NW 12th Street	Sunrise, FL		—		5,570,820		16,794,539		(6,363,816	)		5,570,820		10,430,723		16,001,543		519,716	2008	40 yrs.
5501-5519 Pioneer Park Boulevard	Tampa, FL		—		162,000		1,613,000		979,607			262,416		2,492,191		2,754,607		774,174	1981	40 yrs.
5690-5694 Crenshaw Street	Tampa, FL		—		181,923		1,812,496		217,470			181,923		2,029,967		2,211,890		697,188	1979	40 yrs.
3102,3104,3110 Cherry Palm Drive	Tampa, FL		—		503,767		2,787,585		1,665,018			503,767		4,452,603		4,956,370		1,853,673	1986	40 yrs.
8401-8408 Benjamin Road	Tampa, FL		—		789,651		4,454,648		2,424,302			769,789		6,898,812		7,668,601		2,731,317	1986	40 yrs.
111 Kelsey Lane	Tampa, FL		—		359,540		1,461,850		660,118			359,540		2,121,968		2,481,508		865,380	1990	40 yrs.
131 Kelsey Lane	Tampa, FL		—		511,463		—		5,348,191			559,527		5,300,127		5,859,654		2,096,018	1985	40 yrs.
7724 Woodland Center Boulevard	Tampa, FL		—		235,893		—		2,344,137			235,894		2,344,136		2,580,030		808,901	1998	40 yrs.
7802-50 Woodland Center Boulevard	Tampa, FL		—		357,364		—		2,820,324			506,949		2,670,740		3,177,688		1,185,581	1999	40 yrs.
7852-98 Woodland Center Boulevard	Tampa, FL		—		357,364		—		2,831,556			506,949		2,681,971		3,188,920		1,157,792	1999	40 yrs.
8921 Brittany Way	Tampa, FL		—		224,369		1,063,882		972,276			254,493		2,006,034		2,260,527		564,527	1998	40 yrs.
5250 Eagle Trail Drive	Tampa, FL		—		952,860		—		3,671,277			952,860		3,671,277		4,624,137		1,016,975	1998	40 yrs.
7725 Woodland Center Boulevard	Tampa, FL		—		553,335		—		3,247,449			771,501		3,029,283		3,800,784		753,608	1999	40 yrs.
8001 Woodland Center Boulevard	Tampa, FL		—		350,406		—		2,454,389			438,061		2,366,735		2,804,796		711,284	1999	40 yrs.
4630 Woodland Corporate Boulevard	Tampa, FL		—		943,169		—		12,427,823			1,560,099		11,810,893		13,370,992		2,833,709	2000	40 yrs.
701-725 South US Hwy 301	Tampa, FL		—		419,683		—		3,840,421			661,680		3,598,424		4,260,104		1,365,997	2000	40 yrs.
4502 Woodland Corporate Boulevard	Tampa, FL		—		—		—		4,018,360			1,071,535		2,946,825		4,018,360		675,199	1999	40 yrs.
9001-9015 Brittany Way	Tampa, FL		—		209,841		—		1,877,914			364,514		1,723,242		2,087,756		444,426	2000	40 yrs.
4508 Woodland Corporate Boulevard	Tampa, FL		—		498,598		—		3,258,452			556,887		3,200,163		3,757,050		762,367	2000	40 yrs.
7622 Bald Cypress Place	Tampa, FL		—		—		—		1,305,584			300,000		1,005,584		1,305,584		225,053	2000	40 yrs.
901-933 US Highway 301 South	Tampa, FL		—		500,391				4,041,019			840,314		3,701,097		4,541,411		1,209,118	2001	40 yrs.
4503 Woodland Corporate Boulevard	Tampa, FL		—		—				3,454,328			619,913		2,834,415		3,454,328		580,188	2002	40 yrs.
4505 Woodland Corporate Boulevard	Tampa, FL		—		—				3,361,805			716,594		2,645,211		3,361,805		790,285	2002	40 yrs.
4511 Woodland Corporate Boulevard	Tampa, FL		—		—				2,840,466			686,594		2,153,872		2,840,466		516,379	2002	40 yrs.

98

								Cost
								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		12/31/2008		12/31/08			Acquisition	(years)
OPERATING PROPERTIES
7621 Bald Cypress Place (Bldg N)	Tampa, FL		—		—		—		1,482,613		447,498		1,035,115		1,482,613		184,387		2001	40 yrs.
4520 Seedling Circle	Tampa, FL		—		854,797		42,131		2,721,233		854,797		2,763,364		3,618,161		324,144		2003	40 yrs.
501 US Highway 301 South	Tampa, FL		—		898,884		—		3,498,107		900,508		3,496,483		4,396,991		601,264		2004	40 yrs.
9002-9036 Brittany Way	Tampa, FL		—		492,320		—		3,964,055		899,284		3,557,092		4,456,375		898,192		2004	40 yrs.
8900-34 Brittany Was	Tampa, FL		—		537,194		—		4,267,109		978,019		3,826,284		4,804,303		641,478		2005	40 yrs.
200-34 Kelsey Lane	Tampa, FL		—		330,097		—		3,670,597		933,362		3,067,332		4,000,694		545,939		2005	40 yrs.
910-926 Chad Lane	Tampa, FL		—		201,771		—		3,214,736		628,237		2,788,270		3,416,507		268,040		2006	40 yrs.
150-182 Kelsey Lane	Tampa, FL		—		403,541		—		5,545,972		1,181,609		4,767,905		5,949,513		547,200		2006	40 yrs.
8725 Henderson Road	Tampa, FL		—		3,167,787		19,126,318		77,765		3,167,958		19,203,913		22,371,871		1,748,139		2006	40 yrs.
8735 Henderson Road	Tampa, FL		—		3,166,130		18,735,573		901,647		3,166,300		19,637,050		22,803,350		1,772,264		2006	40 yrs.
8705 Henderson Road	Tampa, FL		—		4,303,870		23,688,409		540,212		4,304,102		24,228,389		28,532,491		2,826,951		2006	40 yrs.
8715 Henderson Road	Tampa, FL		—		3,343,910		18,325,599		165,447		3,344,090		18,490,866		21,834,956		1,449,600		2006	40 yrs.
8745 Henderson Road	Tampa, FL		—		2,050,439		11,173,008		369,184		2,050,548		11,542,083		13,592,631		1,060,574		2006	40 yrs.
7851-7861 Woodland Center Blvd	Tampa, FL		—		548,905		2,241,627		115,828		548,905		2,357,455		2,906,360		183,337		2006	40 yrs.
9306-24 East Broadway Avenue	Tampa, FL		—		450,440		—		3,305,840		486,004		3,270,276		3,756,280		50,077		2007	40 yrs.
7930, 8010-20 Woodland Center Boulevard	Tampa, FL		*		1,408,478		5,247,246		1,008,256		1,408,478		6,255,502		7,663,980		2,120,396		1990	40 yrs.
7920 Woodland Center Boulevard	Tampa, FL		*		1,082,648		2,445,444		23,564		1,082,648		2,469,008		3,551,656		721,718		1997	40 yrs.
8154-8198 Woodland Center Boulevard	Tampa, FL		*		399,088		2,868,834		474,519		399,088		3,343,353		3,742,441		1,186,541		1988	40 yrs.
8112-42 Woodland Center Boulevard	Tampa, FL		*		513,263		3,230,239		658,168		513,263		3,888,408		4,401,670		1,147,345		1995	40 yrs.
8212 Woodland Center Boulevard	Tampa, FL		*		820,882		2,322,720		14,210		820,882		2,336,931		3,157,813		680,703		1996	40 yrs.
8313 West Pierce Street	Tolleson, AZ		—		2,295,090		9,079,811		3,014,938		2,295,090		12,094,749		14,389,840		343,685		2007	40 yrs.
3701 Corporate Parkway	Upper Saucon, PA		—		1,078,674		—		9,823,105		901,968		9,999,811		10,901,779		629,464		2005	40 yrs.
2809 South Lynnhaven Road	Virginia Beach, VA		—		953,590		6,142,742		1,382,128		953,590		7,524,870		8,478,460		2,279,614		1987	40 yrs.
200 Golden Oak Court	Virginia Beach, VA		—		1,116,693		6,770,480		1,420,159		1,116,693		8,190,639		9,307,332		2,528,604		1988	40 yrs.
208 Golden Oak Court	Virginia Beach, VA		—		965,177		6,728,717		1,504,070		965,177		8,232,787		9,197,965		2,598,564		1989	40 yrs.
484 Viking Drive	Virginia Beach, VA		—		891,753		3,607,890		529,968		891,753		4,137,858		5,029,610		1,296,159		1987	40 yrs.
629 Phoenix Drive	Virginia Beach, VA		—		371,694		2,108,097		238,683		371,694		2,346,780		2,718,474		745,517		1996	40 yrs.
5700 Cleveland Street	Virginia Beach, VA		—		700,112		9,592,721		2,158,112		700,564		11,750,381		12,450,945		3,807,303		1989	40 yrs.
1457 Miller Store Road	Virginia Beach, VA		—		473,689		2,663,045		824,754		474,746		3,486,743		3,961,488		609,881		2003	40 yrs.
11020 West Plank Court	Wauwatosa, WI		—		464,246		2,681,255		49,877		464,246		2,731,132		3,195,378		683,120		1985	40 yrs.
825 Duportail Road	Wayne, PA		—		5,536,619		16,179,213		3,593,981		5,539,281		19,770,532		25,309,813		3,971,913		1979	40 yrs.
1500 Liberty Ridge	Wayne, PA		—		8,287,555				31,571,199		11,636,499		28,222,255		39,858,754		6,286,378		2002	40 yrs.
1200 Liberty Ridge Drive	Wayne, PA		—		6,215,667				8,762,512		5,223,660		9,754,519		14,978,179		3,122,508		2001	40 yrs.
11300-90 West Theodore Trecker Way	West Allis, WI		—		500,565		1,591,678		648,026		505,972		2,234,297		2,740,269		269,360		2005	40 yrs.
11548 West Theodore Trecker Way	West Allis, WI		—		660,068		4,640,578		87,815		663,766		4,724,696		5,388,462		418,716		2005	40 yrs.
11420 West Theodore Trecker Way	West Allis, WI		—		348,146		2,057,483		104,569		350,008		2,160,190		2,510,198		187,134		2005	40 yrs.
400-500 Brandywine Parkway	West Chester, PA		—		845,846		6,809,025		438,609		845,846		7,247,634		8,093,480		2,098,749		1988	40 yrs.
600 Brandywine Parkway	West Chester, PA		—		664,899		5,352,410		869,826		664,899		6,222,236		6,887,135		1,935,854		1988	40 yrs.
905 Airport Road	West Chester, PA		—		1,715,000		5,185,000		1,606,158		1,735,012		6,771,146		8,506,158		2,625,718		1988	40 yrs.
42 Kings Hill Avenue	West Malling, UK		—		—		—		16,686,576		3,964,227		12,722,349		16,686,576		538,112		2005	40 yrs.
Liberty Square Retail Blocks	West Malling, UK		—		559,590		5,113,902		2,899,426		1,050,098		7,522,820		8,572,918		693,039		2006	40 yrs.
1 Kings Hill Aveune	West Malling, UK		—		—		—		13,108,043		3,651,552		9,456,491		13,108,043		458,779		2006	40 yrs.
Liberty Square	West Malling, UK		—		—		—		330,317		—		330,317		330,317		(157	)	2006	40 yrs.
3612 La Grange Parkway	Williamsburg, VA		—		—		—		5,722,994		887,234		4,835,761		5,722,994		530,944		2003	40 yrs.
7805 Hudson Road	Woodbury, MN		—		1,279,834		—		10,283,324		1,385,739		10,177,420		11,563,158		2,818,147		2002	40 yrs.
Subtotal Operating Real Estate		$	73,031,582	$	739,850,862	$	1,806,581,935	$	2,527,084,867	$	813,396,833	$	4,260,120,830	$	5,073,517,664	$	982,114,170

99

LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2008

								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		12/31/2008		12/31/08		Acquisition	(years)
DEVELOPMENT PROPERTIES
750 Park of Commerce Boulevard	Boca Raton, FL		—		2,430,000		—		18,111,076		—		20,541,076		20,541,076		—	2007	N/A
8500 Industrial Bouldvard	Breinigsville, PA		—		8,752,708		—		33,267,256		—		42,019,964		42,019,964		—	2007	N/A
676 Independence Parkway	Chesapeake, VA		—		1,527,303		—		8,699,711		—		10,227,014		10,227,014		—	2006	N/A
11841 Newgate Boulevard	Hagerstown, MD		—		3,356,207		—		24,227,728		—		27,583,935		27,583,935		—	2008	N/A
7361 Coca Cola Drive	Hanover, MD		—		2,245,187		—		7,629,724		—		9,874,911		9,874,911		—	2004	N/A
4700 Nathan Lane N — Expansion	Minneapolis, MN		—		—		—		437,333		—		437,333		437,333		—	2008	N/A
3100 SW 145th Avenue	Miramar, FL		—		6,204,407		—		14,345,267		—		20,549,674		20,549,674		—	2007	N/A
27th Street	Oak Creek, WI		—		348,280		—		3,696,508		—		4,044,788		4,044,788		—	2007	N/A
Corporate Preserve Drive	Oak Creek, WI		—		516,016		—		3,873,031		—		4,389,047		4,389,047		—	2007	N/A
201 Summit Park Drive	Orlando, FL		—		1,009,532		—		10,583,667		—		11,593,199		11,593,199		—	2008	N/A
4300 South 26th Street	Philadelphia, PA				—		—		27,848,311		—		27,848,311		27,848,311		—	2008	N/A
3 Crescent Drive	Philadelphia, PA		—		214,726		—		14,404,565		—		14,619,291		14,619,291		—	2008	N/A
4610 South 44th Street	Phoenix, AZ		—		6,539,310		—		4,650,492		—		11,189,801		11,189,801		—	2007	N/A
4550 South 44th Street	Phoenix, AZ		—		5,380,972		—		3,791,364		—		9,172,336		9,172,336		—	2007	N/A
3901 Westerre Parkway	Richmond, VA		—		634,231		—		11,511,294		—		12,145,525		12,145,525		—	2003	N/A
540 Eastpark Court	Richmond, VA		—		742,300		—		4,677,279		—		5,419,579		5,419,579		—	2007	N/A
4631 Woodland Corporate Blvd	Tampa, FL		—		1,453,367		—		12,353,851		—		13,807,218		13,807,218		—	2006	N/A
Subtotal Development in Progress		$	—	$	41,354,546	$	—	$	204,108,454	$	—	$	245,463,000	$	245,463,000	$	—

100

LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2008

								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		12/31/2008		12/31/08		Acquisition	(years)
LAND HELD FOR DEVELOPMENT
Perryman Road Land	Aberdeen, MD		—		12,052,635		—		274,379		12,327,014		—		12,327,014		—	2000	N/A
2 Womack Drive Land	Annapolis, MD		—		5,796,667		—		6,444		5,803,111		—		5,803,111		—	2005	N/A
Boca Colannade Yamato Road	Boca Raton, FL		—		2,039,735		—		566,124		2,605,859		—		2,605,859		—	2001	N/A
Flying Cloud Drive Land	Eden Pairie, MN		—		2,051,631		—		3,701		2,055,331		—		2,055,331		—	1997	N/A
Camelback 303 Business Center Land	Goodyear, AZ		—		16,857,556		—		3,216,158		20,073,714		—		20,073,714		—	2005	N/A
Pleasant Ridge Road Land	Greensboro, NC		—		564,535		—		2,895,957		3,460,492		—		3,460,492		—	2008	N/A
Southchase Business Park Land	Greenville, SC		—		1,308,325		—		705,094		2,013,419		—		2,013,419		—	2007	N/A
Caliber Ridge Ind. Park Land	Greer, SC		—		2,297,492		—		3,562,592		5,860,084		—		5,860,084		—	2007	N/A
Hunters Green Land	Hagerstown, MD		—		5,489,586		—		8,334,639		13,824,225		—		13,824,225		—	1999	N/A
Lakefront Plaza II Land	Hampton, VA		229,953		138,101		—		101,061		239,162		—		239,162		—	2007	N/A
Ridge Road Land	Hanover, MD		—		3,371,183		—		439,543		3,810,727		—		3,810,727		—	2007	N/A
Mendenhall Land	High Point, NC		—		1,757,675		—		1,645,453		3,403,128		—		3,403,128		—	1998	N/A
Piedmond Centre Land	High Point, NC		—		913,276		—		757,687		1,670,963		—		1,670,963		—	1995	N/A
Commonwealth Corporate Center Land	Horsham, PA		—		3,043,938		—		25,160		3,069,098		—		3,069,098		—	1998	N/A
Beltway 8 @Bammel Bus Park Land	Houston, TX		—		1,072,634		—		13,656		1,086,290		—		1,086,290		—	2006	N/A
Central Green Land — Tract 5	Houston, TX		—		4,169,183		—		580,110		4,749,293		—		4,749,293		—	2000	N/A
Greens Crossing Land	Houston, TX		—		2,476,892		—		14,369		2,491,261		—		2,491,261		—	1995	N/A
Rankin Road Land	Houston, TX		—		5,756,865		—		94,054		5,850,919		—		5,850,919		—	1996	N/A
Hollister Beltway 8 Land	Houston, TX		—		6,282,232		—		88,510		6,370,741		—		6,370,741		—	2006	N/A
Noxell Land	Hunt Valley, MD		—		2,040,690		—		1,173		2,041,863		—		2,041,863		—	2007	N/A
Liberty Business Park Land	Jacksonville, FL		—		456,269		—		82,345		538,614		—		538,614		—	1987	N/A
7024 AC Skinner Parkway	Jacksonville, FL		—		751,448		—		73,504		824,952		—		824,952		—	2007	N/A
Belfort Road	Jacksonville, FL		—		492,908		—		87,304		580,212		—		580,212		—	2006	N/A
Salisbury Road Land	Jacksonville, FL		—		1,402,337		—		198,904		1,601,241		—		1,601,241		—	2005	N/A
Skinner Land Parcel B	Jacksonville, FL		—		2,295,790		—		1,230,516		3,526,306		—		3,526,306		—	2008	N/A
Imeson Road Land	Jacksonville, FL		—		4,153,948		—		158,922		4,312,870		—		4,312,870		—	2000	N/A
Kent County, UK	Kent County, UK		—		—		—		14,577,381		14,577,381		—		14,577,381		—	1999	N/A
Commodore Business Park	Logan, NJ		—		792,118		—		671,146		1,463,264		—		1,463,264		—	1998	N/A
Quarry Ridge Land	Malvern, PA		—		4,774,994		—		5,850,801		10,625,795		—		10,625,795		—	2007	N/A
Park Place South Land	Milwaukee, WI		—		1,290,032		—		2,230,261		3,520,293		—		3,520,293		—	2006	N/A
Monarch Towne Center Land	Mirarar, FL		—		6,085,337		—		413,926		6,499,264		—		6,499,264		—	2006	N/A
South 27th Street Land	Oak Creek, WI		—		2,169,232		—		2,685,212		4,854,444		—		4,854,444		—	2001	N/A
Beachline Industrial Park Land	Orlando, FL		—		365,230		—		—		365,230		—		365,230		—	2006	N/A
JFK & Arch Parking Lots/Land (West)	Philadelphia, PA		—		4,792,286		—		4,147,633		8,939,919		—		8,939,919		—	2007	N/A
Cotton Center Land	Phoenix, AZ		—		4,449,689		—		40		4,449,729		—		4,449,729		—	1997	N/A
Eastport VIII	Richmond, VA		—		382,698		—		3,325		386,023		—		386,023		—	2006	N/A
Eastport IX	Richmond, VA		—		211,627		—		3,325		214,952		—		214,952		—	1998	N/A
IRS Distribution Ctr Land	Richmond, VA		—		12,981		—		—		12,981		—		12,981		—	2007	N/A
Woodlands Center Land	Sandston, VA		—		148,314		—		19,354		167,668		—		167,668		—	2007	N/A
Northsight Land (LPLP)	Scottsdale, AZ		—		6,176,464		—		2,204,597		8,381,061		—		8,381,061		—	2001	N/A
Old Scotland Road Land	Shippensburg, PA		—		8,322,686		—		2,562,070		10,884,757		—		10,884,757		—	2005	N/A
Bridgeway II Land	Suffolk, VA		—		603,391		—		2,022,814		2,626,205		—		2,626,205		—	1995	N/A
Suffolk Land	Suffolk, VA		—		2,715,714		—		675,966		3,391,680		—		3,391,680		—	2005	N/A
6119 W. Linebaugh Avenue	Tampa, FL		—		180,136		—		30,500		210,635		—		210,635		—	2005	N/A
Tampa Triangle Land	Tampa, FL		—		10,358,826		—		1,125,564		11,484,390		—		11,484,390			2006	N/A
Renaissance Park Land	Tampa, FL		—		1,995,375		—		308,575		2,303,950		—		2,303,950		—	2007	N/A
Subtotal Land Held for Development		$	229,953	$	150,902,343	$	—	$	58,648,168	$	209,550,512	$	—	$	209,550,512	$	—
Total All Properties		$	73,261,535	$	932,107,751	$	1,806,581,935	$	2,789,841,489	$	1,022,947,345	$	4,505,583,831	$	5,528,531,176	$	982,114,170

* Denotes property is collateralized under mortgages with American General, USG Annuity and Life, Metropolitan Life and LaSalle Bank totaling $122.4 million.

101

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,
	2008			2007			2006
REAL ESTATE:
Balance at beginning of year	$	5,765,409		$	5,101,280		$	4,649,302
Additions		330,371			939,322			820,012
Disposition of property		(567,248	)		(275,193	)		(368,034	)
Balance at end of year	$	5,528,532		$	5,765,409		$	5,101,280
ACCUMULATED DEPRECIATION:
Balance at beginning of year	$	858,671		$	782,750		$	712,786
Depreciation expense		140,925			126,852			120,947
Disposition of property		(17,482	)		(50,931	)		(50,983	)
Balance at end of year	$	982,114		$	858,671		$	782,750

102

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, 2008 and 2007

Statements of Operations:

Liberty Property Trust Consolidated for the years ended December 31, 2008, 2007, and 2006

Statements of Shareholders’ Equity:

Liberty Property Trust Consolidated for the years ended December 31, 2008, 2007, and 2006

Statements of Cash Flows:

Liberty Property Trust Consolidated for the years ended December 31, 2008, 2007, and 2006

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, 2008 and 2007

Statements of Operations:

Liberty Property Limited Partnership Consolidated for the years ended December 31, 2008, 2007, and 2006

Statements of Owners’ Equity:

Liberty Property Limited Partnership Consolidated for the years ended December 31, 2008, 2007, and 2006

Statements of Cash Flows:

Liberty Property Limited Partnership Consolidated for the years ended December 31, 2008, 2007, and 2006

Notes to Consolidated Financial Statements — Liberty Property Limited Partnership

2. FINANCIAL STATEMENT SCHEDULES:

Schedule III — Real Estate and Accumulated Depreciation as of December 31, 2008 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, 2008 for Liberty Property Limited Partnership

103

All other schedules are omitted because they are either not required or the required information is shown in the financial statements or notes thereto.

3. EXHIBITS:

The following exhibits are filed herewith or are incorporated by reference to exhibits previously filed.

EXHIBIT NO.	DESCRIPTION
12	Statement re: Computation of Ratios
23.1	Consent of Independent Registered Public Accounting Firm
23.2	Consent of Independent Registered Public Accounting Firm

104

SIGNATURES

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

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

Dated: May 19, 2009

105