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

Form 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2000

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to .

Commission File Number 0-15465

Banyan Strategic Realty Trust
-----------------------------------------------------
(Exact name of Registrant as specified in its charter)

Massachusetts 36-3375345
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

150 South Wacker Drive, Chicago, IL 60606
(Address of principal executive offices) (Zip Code)

Registrant's telephone number including area code (312) 553-9800

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

Title of each class Name of each exchange on which registered

None None

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

Shares of Beneficial Interest
(Title of Class)

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. YES [ X ]. NO [ ].

Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [ X ]

Shares of beneficial interest outstanding as of February 16, 2001:
14,283,294. The aggregate market value of the Registrant's shares of
beneficial interest held by non-affiliates on such date was $64,135,546.

DOCUMENTS INCORPORATED BY REFERENCE
Exhibit index located on page 71 of sequentially numbered pages.

TABLE OF CONTENTS

PART I

ITEM 1. BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . 1

ITEM 2. PROPERTIES . . . . . . . . . . . . . . . . . . . . . . . 3

ITEM 3. LEGAL PROCEEDINGS. . . . . . . . . . . . . . . . . . . . 9

ITEM 4. SUBMISSION OF MATTERS TO A VOTE
OF SECURITY HOLDERS. . . . . . . . . . . . . . . . . . . 10

PART II

ITEM 5. MARKET FOR THE REGISTRANT'S SHARES AND
RELATED SHAREHOLDER MATTERS. . . . . . . . . . . . . . . 11

ITEM 6. SELECTED FINANCIAL DATA. . . . . . . . . . . . . . . . . 13

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS. . . . . . 17

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE
ABOUT MARKET RISK. . . . . . . . . . . . . . . . . . . . 26

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. . . . . . . 27

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE . . . . . . . . . 57

PART III

ITEM 10. TRUSTEES AND EXECUTIVE OFFICERS OF THE
REGISTRANT . . . . . . . . . . . . . . . . . . . . . . . 57

ITEM 11. EXECUTIVE COMPENSATION . . . . . . . . . . . . . . . . . 59

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT. . . . . . . . . . . . . . . . . . 66

ITEM 13. CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS . . . . . . . . . . . . . . . . . . 69

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
AND REPORTS ON FORM 8-K. . . . . . . . . . . . . . . . . 69

SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70

PART I

ITEM 1. BUSINESS

Certain statements in this Annual Report that are not historical in
fact constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements are
based on our current expectations, estimates and projections. These
statements are not a guaranty of future performance. Without limiting the
foregoing, words such as "believes," "intends," "anticipates," "expects,"
and similar expressions are intended to identify forward-looking statements
which are subject to a number of risks and uncertainties, including, among
other things:

. general real estate investment risks;

. litigation affecting the sale of our assets;

. potential inability to repay or refinance indebtedness at
maturity;

. increases in interest rates;

. adverse consequences of failure to qualify as a REIT;

. possible environmental liabilities;

. the terms of a plan of termination and liquidation; and

. failure to complete the sale of our assets.

Actual results could differ materially from those projected in these
forward-looking statements. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations -Risk Factors" for a more
complete discussion.

GENERAL

We are a self-administered infinite life real estate investment trust
("REIT"), organized as a Massachusetts business trust, which owns and
operates primarily office and flex/industrial properties. We operate
principally through BSRT UPREIT Limited Partnership, referred to as the
Operating Partnership, and its subsidiaries. BSRT UPREIT Corp., a wholly-
owned subsidiary, is the General Partner of the Operating Partnership. As
of December 31, 2000, we were the sole limited partner of BSRT UPREIT
Limited Partnership. As of December 31, 2000, we owned individually, or,
in some cases through joint ventures, twenty-seven properties comprised of:

. fourteen office properties totaling 1.5 million rentable square
feet;

. twelve flex/industrial properties totaling 1.7 million rentable
square feet;

. one retail property totaling 321,600 rentable square feet.

(See the property section below for a detailed information regarding all
properties in the portfolio.)

On January 8, 2001, we entered into a Purchase and Sale Agreement to
sell all of our real estate assets including the properties owned in joint
ventures to an unaffiliated third party for $226 million plus the cost of
all prepayment penalties and assumption fees related to our mortgage debt.
The contract contains standard conditions to closing including a due
diligence period during which the buyer may terminate the contract for any

reason without penalty. Pursuant to the Purchase and Sale Agreement, the
due diligence period ends March 30, 2001 and the purchaser retains the
absolute right to terminate the contract for any reason during the due
diligence period. The closing is scheduled for April 30, 2001, unless
extended by the parties.

In anticipation of the sale of our real estate assets, on January 5,
2001, we adopted a Plan of Termination and Liquidation under which the
Trust will be dissolved, obligations of the Trust will be discharged,
appropriate reserves will be taken and the net proceeds from the sale will
be distributed to the shareholders.

BUSINESS

Although we are currently operating in accordance with plan of
termination and liquidation and are working to complete the sale of our
real estate assets, our continuing focus is to maintain the value of our
portfolio. In order to do so, we seek to carefully and aggressively manage
our assets to maximize the cash flow generated by, and the long term value
of, our properties. To achieve this objective, we develop an annual
operating plan for each property which focuses on increasing property
revenue through:

. increased occupancy and/or higher rents;

. negotiating leases containing base rental increases;

. emphasizing tenant satisfaction;

. controlling operating expenses; and

. expanding existing properties.

As of December 31, 2000, we had borrowed a total of $119.7 million,
$22.5 million of which bears interest at variable rates. Based on the
closing price of our common shares on December 31, 2000, our borrowings
represent approximately 58.4% of our total market capitalization.

We compete with numerous other properties in attracting tenants to
lease our space. Some of the competing properties may be newer, better
located or owned by parties that are better capitalized. We believe that
our properties are located in high-growth areas and will continue to
attract tenants competitively. We further believe that the operating
strategy for our properties allows us to remain competitive with other
entities in our geographical markets.

OTHER INFORMATION

Our business and real estate property operations are not seasonal and
they compete on the basis of rental rates and property operations with
similar types of properties in the vicinities in which our properties are
located.

We have no real property investments located outside of the United
States. We do not segregate revenue or assets by geographic region, since,
in management's view, such a presentation would not be significant to an
understanding of our business or financial results taken as a whole.

We have fifteen employees, four of whom serve as executive officers.

We review and monitor compliance with federal, state and local
provisions which have been enacted or adopted regulating the discharge of
material into the environment, or otherwise relating to the protection of
the environment. For the year ended December 31, 2000, we did not incur
any material capital expenditures for environmental control facilities nor
do we anticipate making any such expenditures for the year ending
December 31, 2001.

ITEM 2. PROPERTIES

As of December 31, 2000, we owned interests, directly or indirectly through our wholly owned subsidiaries, in
the properties set forth in the table below:

BANYAN STRATEGIC REALTY TRUST
PORTFOLIO SUMMARY
December 31, 2000

FLEX/INDUSTRIAL
- ---------------
Milwaukee A 1% General and 84%
Industrial Limited Partner
Properties interest in a joint
Milwaukee, WI 4/30/93 235,800 92% 18% 39% 6% 29% venture (b) (c)

Elmhurst Metro A 1% General and 84%
Court Limited Partner
Elmhurst, IL 11/30/93 140,800 86% 29% 12% 6% 39% interest in a joint
venture (b) (c)

Willowbrook A 1% General and 84%
Industrial Court Limited Partner
Willowbrook, IL 6/16/95 84,300 99% 32% 28% 34% 5% interest in a joint
venture (b) (c)

Lexington Fee ownership of
Business Center land and improve-
Lexington, KY 12/05/95 308,800 70% 9% 5% 11% 45% ments

Scheduled Lease
Expirations
Occu- ----------------------------------
Date Square pancy After
Acquired Footage % 2001 2002 2003 2003 Description (a)
-------- ------- ----- ----- ---- ---- ----- ---------------------
Newtown Business Fee ownership of
Center land and improve-
Lexington, KY 12/05/95 87,100 98% 39% 16% 9% 34% ments

6901 Riverport Leasehold interest
Drive pursuant to bond
Louisville, KY 11/19/96 322,100 55% 0% 0% 0% 55% financing and owner-
ship of improvements

Avalon Ridge Fee ownership of
Business Park land and improve-
Norcross, GA 4/24/98 57,400 100% 0% 0% 39% 61% ments

A 1% General and
Tower Lane 84% Limited Partner
Business Park interest in a joint
Bensenville, IL 4/27/98 95,900 84% 31% 25% 11% 17% venture (b) (f)

Fee ownership of
Metric Plaza land and improve-
Winter Park, FL 4/30/98 32,000 100% 0% 69% 31% 0% ments

Fee ownership of
Park Center land and improve-
Orlando, FL 4/30/98 47,400 90% 32% 32% 11% 15% ments

University Fee ownership of
Corporate Center land and improve-
Winter Park, FL 4/30/98 127,800 77% 39% 22% 13% 3% ments

Johns Creek
Office and
Industrial Park Fee ownership of
Duluth and land and improve-
Suwanne, GA 8/14/98 119,300 100% 0% 50% 0% 50% ments

--------- ---- ---- ---- ---- ----
Sub-total 1,658,700 80% 16% 19% 10% 35%
--------- ---- ---- ---- ---- ----

Scheduled Lease
Expirations
Occu- ----------------------------------
Date Square pancy After
Acquired Footage % 2001 2002 2003 2003 Description (a)
-------- ------- ----- ----- ---- ---- ----- ---------------------
OFFICE
- ------
Colonial Penn Fee ownership of
Building land and improve-
Tampa, FL 3/22/94 79,200 74% 0% 0% 0% 74% ments

Commerce
Center f/k/a
Florida Power Fee ownership of
& Light Building land and improve-
Sarasota, FL 3/22/94 81,100 100% 11% 5% 0% 84% ments

A 1% General and 84%
Woodcrest Office Limited Partner
Park interest in a joint
Tallahassee, FL 12/19/95 264,900 87% 14% 20% 14% 39% venture (b) (e)

Midwest Office A 1% General and 84%
Center Limited Partner
Oakbrook interest in a joint
Terrace, IL 4/18/96 77,000 100% 28% 15% 50% 7% venture (b) (c)

Phoenix Business Fee ownership of
Park land and improve-
Atlanta, GA 1/15/97 110,600 100% 4% 18% 9% 69% ments

A 1% General and
Butterfield 84% Limited Partner
Office Plaza interest in a joint
Oak Brook, IL 4/30/97 200,800 91% 22% 39% 11% 19% venture (b) (f)

Southlake Fee ownership of
Corporate Center land and improve-
Morrow, GA 7/30/97 56,200 94% 32% 35% 6% 23% ments

University Square Fee ownership of
Business Center land and improve-
Huntsville, AL 8/26/97 184,700 93% 29% 24% 10% 30% ments

Leasehold interest
pursuant to a ground
Technology Center lease and ownership of
Huntsville, AL 8/26/97 48,500 100% 0% 0% 0% 100% improvements

Scheduled Lease
Expirations
Occu- ----------------------------------
Date Square pancy After
Acquired Footage % 2001 2002 2003 2003 Description (a)
-------- ------- ----- ----- ---- ---- ----- ---------------------
Airways Plaza Fee ownership of
Office Center land and improve-
Memphis, TN 12/10/97 87,800 19% 4% 5% 8% 2% ments

Peachtree Pointe Fee ownership of
Office Park land and improve-
Norcross, GA 1/20/98 71,700 83% 21% 13% 19% 30% ments

Avalon Center Fee ownership of
Office Park land and improve-
Norcross, GA 3/20/98 53,300 100% 0% 0% 13% 87% ments

Sand Lake Fee ownership of
Tech Center land and improve-
Orlando, FL 4/30/98 84,100 97% 0% 0% 38% 59% ments

Technology Fee ownership of
Park land and improve-
Norcross, GA 8/14/98 145,700 96% 24% 4% 40% 28% ments
--------- ---- ---- ---- ---- ----
Sub-total 1,545,600 88% 16% 16% 16% 40%
--------- ---- ---- ---- ---- ----

RETAIL
- ------
Leasehold interest
pursuant to a ground
lease and ownership of
Northlake improvements (through
Tower Shopping a 1% General and 80.9%
Center Limited Partner
Atlanta, GA 7/28/95 321,600 98% 2% 7% 13% 76% interest) in a joint
--------- ---- ---- ---- ---- ---- venture (b) (d)
Portfolio
Total 3,525,900 85% 15% 17% 13% 40%
========= ==== ==== ==== ==== ====

<FN>
- --------------------

(a) Reference is made to Schedule III "Consolidated Real Estate and Accumulated Depreciation" filed with this
annual report for additional description of these real property investments.

(b) In all of our partnerships, we are the managing general partner and retain sole authority over all
significant decisions.

(c) The stated percentages represent the economics of the venture; however, through our general and limited
partnership interest we hold a 90% voting interest in the venture. According to the partnership agreement, prior
to distributing cash flow from operations, our 84% and 1% partnership interests receive an annual 12% preferred
return on their respective net capital contributed to the partnership. Our joint venture partner then receives an
11% preferred return on the net capital which it has contributed. Then, 85% of the remaining cash will be
distributed to us and 15% will be distributed to the joint venture partner. Cash flow from either a sale or
refinancing of the partnership properties is distributed as follows: (i) our 84% and 1% partnership interests
receive an annual 12% preferred return on our net capital contributed to the partnership; (ii) the joint venture
partner receives an 11% preferred return on the net capital contributed to the partnership; (iii) we receive an
amount equal to our net capital contributions; (iv) our joint venture partner receives an amount equal to its net
capital contributions; (v) we receive an amount equal to 20.41% of our capital contribution; (vi) our joint
venture partner receives an amount equal to 52.63% of its capital contribution; (vii) then, 65% of the remaining
cash will be distributed to us and 35% will be distributed to our joint venture partner.

(d) The stated percentages represent our voting rights, not necessarily the economics of the venture. According
to the partnership agreement, prior to distributing cash flow from operations, our 80.9% and 1% partnership
interests receive an annual 12% preferred return on their respective net capital contributed to the partnership.
Then, our joint venture partner receives a 12% preferred return on the net capital which it has contributed.
Then, cash flow from operations is distributed pro-rata based on each partner's respective ownership interest.
Cash proceeds from either the sale or refinancing of the partnership property will be used: (i) to pay any of our
unpaid preferred returns; (ii) to return net capital contributed by all partners; (iii) to pay any of the venture
partner's unpaid preferred returns and (iv) to distribute the remaining cash based on ownership interests until we
have received an overall return of 15% on our invested capital. Then, we will receive 71.9% of the excess cash
and the balance will be paid to the joint venture partner.

(e) The stated percentages represent our voting rights, not necessarily the economics of the venture. According
to the partnership agreement, prior to distributing cash flow from operations, our 84% and 1% partnership interest
receive an annual 12% preferred return on their average unreturned Initial Capital Contribution to the
partnership. Then, our joint venture partner receives a 12% preferred return on its average unreturned Initial
Capital Contribution. Then, cash flow from operations is distributed pro-rata based on each partner's respective
ownership interest. Cash proceeds from either the sale or refinancing of the partnership properties will be used:

(i) to pay any of our unpaid preferred returns; (ii) to return our net capital contributed; (iii) to pay any
amounts necessary for us to receive a 15% cumulative return on our net total average unreturned capital
contributed; (iv) to pay the joint venture partner's unpaid preferred returns; (v) to return the joint venture
partner's net capital contributed; and (vi) the remaining cash will be distributed pro-rata based on each
partner's ownership interest.

(f) The stated percentages represent the economics of the venture; however, through our general and limited
partnership interest we hold a 90% voting interest in the venture. According to the partnership agreement, cash
flow from operations is distributed as follows: (i) our 84% and 1% partnership interests receive an annual 12%
preferred return on their respective net capital contributed to the partnership; (ii) the joint venture partner
receives an 11% preferred return on the net capital contributed to the partnership; (iii) then, 85% of the
remaining cash will be distributed to us and 15% will be distributed to the joint venture partner. Cash flow from
either a sale or refinancing of the partnership properties is distributed as follows: (i) our 84% and 1%
partnership interests receive an annual 12% preferred return on our net capital contributed to the partnership;
(ii) the joint venture partner receives an 11% preferred return on the net capital contributed to the partnership;
(iii) we receive an amount equal to our net capital contributions; (iv) our joint venture partner receives an
amount equal to its net capital contributions; (v) we receive an amount equal to 20.41% of our capital
contribution; (vi) our joint venture partner receives an amount equal to 52.63% of its capital contribution; (vii)
then, 65% of the remaining cash will be distributed to us and 35% will be distributed to our joint venture
partner.

ITEM 3. LEGAL PROCEEDINGS

On August 14, 2000, the Trust exercised its rights under the Trust's
employment agreement with Mr. Leonard G. Levine by suspending him and
placing him on leave from his position as president. Simultaneously, the
Trust initiated an arbitration proceeding as required under the employment
agreement. On October 5, 2000, Mr. Levine filed an action in the Circuit
Court of Cook County, Illinois asking the court to terminate the
arbitration proceedings by reason of improper forum. On October 18, 2000,
the Trust filed a lawsuit against Mr. Levine in the Circuit Court of Cook
County, Illinois. The Trust's complaint alleges violations of Mr. Levine's
duty of loyalty owed to the Trust.

On December 6, 2000, Mr. Levine and the Trust, through their
respective attorneys, agreed to dismiss the arbitration action and Mr.
Levine's lawsuit challenging the arbitration and further agreed to resolve
all issues under Mr. Levine's employment contract within the Trust's
lawsuit against Mr. Levine in the Circuit Court of Cook County (the
"Employment Litigation"). The Trust has since filed an amended complaint
which seeks a declaratory judgment that the Trust has, and had, "just
cause" to terminate Mr. Levine's employment contract as well as an
accounting and the disgorgement of all benefits received by Mr. Levine
while in breach of his fiduciary duties. The factual bases underlying the
amended complaint include allegations that (i) Mr. Levine caused the Trust
to pay on his account or reimburse him for expenses that were not
reasonable, ordinary and necessary business expenses and (ii) during
negotiations between the Trust and The Oak Realty Group, Inc. (an entity
solely owned by Mr. Levine) Mr. Levine attempted to pressure the Trust into
accepting Oak's offer to acquire the Trust by revealing to one of the
trustees that Oak had entered into certain confidentiality and exclusivity
agreements which had the intended effect of excluding potential purchasers
and/or capital providers from purchasing or providing financing to a
potential purchaser of the Trust, except through Oak.

On January 19, 2001, Mr. Levine filed an answer, affirmative defenses
and counterclaim in the Employment Litigation. The pleading generally
denies that Mr. Levine breached his fiduciary duties, raises various
defenses and seeks a judgment in favor of Mr. Levine on the counterclaim
reinstating him to active employment status. Discovery in this case has
recently begun. The maximum potential liability in connection with Mr.
Levine's contract (inclusive of incentives but exclusive of base salary) is
estimated to be $1.8 million.

Also on January 19, 2001, Mr. Levine filed two lawsuits in the Circuit
Court of Cook County. In the first action, Mr. Levine, suing derivatively
on behalf of the Trust's shareholders, seeks to enjoin trustees Daniel
Levinson, Stephen Peck and L.G. Schafran from completing the pending sale
of substantially all of the Trust's assets to Denholtz Management
Corporation until the Trust obtains approval of the transaction from a
majority of the Trust's shareholders. This matter has been removed by the
Trustees to the United States District Court for the Northern District of
Illinois and the Trust has intervened as an additional defendant. All
defendants jointly moved for summary judgment on February 9, 2001. The
plaintiff filed a cross motion for summary judgment on February 20, 2001.
The cross motions for summary judgment were fully briefed as of March 2,
2001 and the Court has taken the matter under advisement.

Mr. Levine has also filed an action in the Circuit Court of Cook
County against trustees Daniel Levinson, Stephen Peck and L.G. Schafran as
well as two of the Trust's largest shareholders Morgens, Waterfall,
Vintiadis & Company, Inc. and Magten Asset Management Corporation. This
action seeks unspecified compensatory and punitive damages for a variety of
business related torts which Mr. Levine alleges the defendants have
committed against him. This matter has been removed by the defendants to
the United States District Court for Northern District of Illinois. No
answer or other responsive pleadings has yet been filed by any of the
defendants.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The Trust held its 1999 Meeting of Shareholders on December 14, 2000.
There were two proposals considered at the Meeting:

PROPOSAL #1 was to elect four trustees;

PROPOSAL #2 was to ratify the selection of Ernst & Young, LLP as our
independent accountants for 2000;

PROPOSAL #1

FOR WITHHELD
---------- --------
SLATE OF TRUSTEES ELECTED

Walter E. Auch, Sr. 11,450,953 108,816
Daniel Levinson 10,571,346 988,423
Stephen M. Peck 11,108,688 451,081
L.G. Schafran 10,586,014 973,755

(All elected)

FOR AGAINST ABSTAIN
---------- ------- -------
PROPOSAL #2 11,489,591 32,159 38,019
(Carried)

PART II

ITEM 5. MARKET FOR THE REGISTRANT'S SHARES AND RELATED SHAREHOLDER MATTERS

Our shares are included for quotation on the NASDAQ National Market
(symbol - BSRTS). The table below shows the quarterly high and low bid
prices reported by NASDAQ and the amount of cash distributions we paid per
share for the years ended December 31, 2000 and 1999.

2000
----
Quarter Share Per Share Declaration
Ended Price Distributions Date
- ------- ----- ------------- -----------

3/31 High $6.00 $0.12 4/5/00
Low $5.25

6/30 High $6.06 $0.12 7/14/00
Low $5.13

9/30 High $6.00 $0.12 10/16/00
Low $5.06

12/31 High $5.75 $0.03 1/19/01
Low $5.13

1999
----
Quarter Share Per Share Declaration
Ended Price Distributions Date
- ------- ----- ------------- -----------

3/31 High $5.81 $0.12 4/05/99
Low $4.31

6/30 High $6.00 $0.12 7/07/99
Low $4.37

9/30 High $6.06 $0.12 10/06/99
Low $4.75

12/31 High $6.00 $0.12 1/10/00
Low $4.37

On January 19, 2001, we declared a cash distribution for the quarter
ended December 31, 2000 of $0.03 per share payable February 28, 2001 to
shareholders of record on January 29, 2001.

During 2000 and 1999, we paid distributions to common shareholders
equal to $0.48 and $0.48 per share, respectively. A total of $0.12 per
share in 2000 represented a return of capital to common shareholders.
During 2000, we also paid distribution to preferred shareholders of $9.51
per share. No portion of 1999 distributions represented a return of
capital.

Our ability to make future distributions to our shareholders is
dependent upon, among other things:

. sustaining the operating performance of our existing real
estate investments through scheduled increases in base rents under existing
leases and through general improvement in the real estate markets where our
properties are located;

. our level of operating expenses; and

. the timing of and our success in completing the sale of our
real estate assets pursuant to our plan of termination and liquidation.

See "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Risk Factors" for a more complete discussion.

As of February 16, 2001, there were 3,148 record holders of shares of
beneficial interest.

ITEM 6. SELECTED FINANCIAL DATA (1)

Operating Data:
Revenues . . . . . . . . . . . . . . $ 37,796 $ 41,716 $ 39,416 $ 28,785 $ 21,404

Expenses:
Interest . . . . . . . . . . . . . . 9,180 11,558 9,778 6,447 4,011
Depreciation and amortization. . . . 7,215 6,942 5,484 4,213 2,965
Property operating . . . . . . . . . 12,314 13,601 13,449 10,689 9,294
General and administrative . . . . . 5,971 4,496 4,614 4,315 3,126
Recovery of losses on loans,
notes and interest receivable. . . -- -- -- (161) (17)
-------- -------- -------- -------- --------
Total expenses . . . . . . . . 34,680 36,597 33,325 25,503 19,379
-------- -------- -------- -------- --------
Income before minority interest,
income (loss) from operations of
real estate venture, net gains
and extraordinary item (2) . . . . . 3,116 5,119 6,091 3,282 2,025
Minority interest. . . . . . . . . . . (491) (538) (572) (590) (481)
Income (loss) from operations of
real estate venture. . . . . . . . . -- -- -- 37 (3,301)
Net gains and extraordinary item . . . (42) 3,906 (141) 817 --
-------- -------- -------- -------- --------
Net income (loss). . . . . . . . . . . 2,583 8,487 5,378 3,546 (1,757)

Less Income Available to
Preferred Shares . . . . . . . . . . (585) -- -- -- --
-------- -------- -------- -------- --------

Net Income Available to
Common Shares. . . . . . . . . . . . $ 1,998 $ 8,487 $ 5,378 $ 3,546 $ (1,757)
======== ======== ======== ======== ========
Basic Earnings Available to
Common Shares per weighted-average
Common Share:
Income (loss) before net gains
and extraordinary item. . . . . . . $ 0.14 $ 0.34 $ 0.41 $ 0.24 $ (0.17)
======== ======== ======== ======== ========
Net income (loss). . . . . . . . . . $ 0.14 $ 0.63 $ 0.40 $ 0.32 $ (0.17)
======== ======== ======== ======== ========

For the years ended December 31,
--------------------------------------------------------------------
2000 1999 1998 1997 1996
-------- -------- -------- -------- --------
(amounts in thousands, except per share data)
Diluted Earnings Available to
Common Shares per weighted-average
Common Share:
Income (loss) before net gains
and extraordinary item. . . . . . . $ 0.14 $ 0.34 $ 0.40 $ 0.24 $ (0.17)
======== ======== ======== ======== ========
Net income (loss). . . . . . . . . . $ 0.14 $ 0.63 $ 0.39 $ 0.32 $ (0.17)
======== ======== ======== ======== ========

Balance Sheet Data:

Investment in real estate, net . . . . $184,175 $183,844 $209,409 $149,386 $102,490
Total assets . . . . . . . . . . . . . 196,057 206,647 222,590 159,634 116,534
Loans and bonds payable. . . . . . . . 119,652 132,681 151,648 92,118 59,081
Shareholders' equity . . . . . . . . . 67,350 65,295 62,434 62,315 50,934

Cash flows from:
Operating activities . . . . . . . . $ 9,393 $ 10,844 $ 11,220 $ 8,644 $ 5,730
Investing activities . . . . . . . . (6,125) 7,581 (61,790) (27,575) (6,598)
Financing activities . . . . . . . . (13,972) (9,059) 49,872 19,555 (827)

Number of property interests owned . . 27 27 32 22 15
Weighted average
number of shares . . . . . . . . . . 14,183 13,469 13,308 11,150 10,478
Cash distributions per share of
beneficial interest. . . . . . . . . $ 0.48 $ 0.48 $ 0.46 $ 0.40 $ 0.40
======== ======== ======== ======== ========
<FN>
- ------------

(1) You should read the above selected financial data in conjunction with the consolidated financial statements
and the related notes appearing elsewhere in this annual report.

(2) Net gains include gain on disposition of investment in real estate, loss on disposition of investment in
real estate venture and gain on disposition of partnership interest.

QUARTERLY RESULTS OF OPERATIONS

The following is a summary of the quarterly results of operations for the years ended December 31, 2000 and
1999.

2000
For the three months ended:
-----------------------------------------------------------------
March 31 June 30 September 30 December 31
----------- ------------ ------------ ------------
(Amounts in thousands, except per share data)

Total Revenue $ 9,350 $ 9,460 $ 9,285 $ 9,701

Operating Expenses (8,040) (8,118) (9,742) (8,780)
-------- -------- -------- --------
Operating Income (Loss) 1,310 1,342 (457) 921

Minority Interest in Consolidated
Partnerships (126) (147) (130) (88)
-------- -------- -------- --------
Income (Loss) before Net Gains and
Extraordinary Item 1,184 1,195 (587) 833

Extraordinary Item (42) -- -- --
-------- -------- -------- --------
Net Income (Loss) 1,142 1,195 (587) 833

Less Income Available to Preferred Shares (123) (153) (155) (154)
-------- -------- -------- --------
Net Income Available to Common Shares $ 1,019 $ 1,042 $ (742) $ 679
======== ======== ======== ========
Basic and Diluted Earnings Available
to Common Shares per weighted-average
Common Share:
Income (Loss) before Net Gains and
Extraordinary Item $ 0.07 $ 0.07 $ (0.05) $ 0.05
======== ======== ======== ========

Net Income (Loss) $ 0.07 $ 0.07 $ (0.05) $ 0.05
======== ======== ======== ========

1999
For the three months ended:
-----------------------------------------------------------------
March 31 June 30 September 30 December 31
----------- ------------ ------------ ------------
(Amounts in thousands, except per share data)

Total Revenue $ 10,428 $ 10,483 $ 10,509 $ 10,296

Operating Expenses (9,076) (9,115) (9,180) (9,226)
-------- -------- -------- --------
Operating Income 1,352 1,368 1,329 1,070

Minority Interest in Consolidated
Partnerships (114) (141) (126) (157)
-------- -------- -------- --------
Income before Net Gains and Extra-
ordinary Item 1,238 1,227 1,203 913

Net Gains on Disposition of
Investments in Real Estate -- -- -- 4,089

Extraordinary Item, Net of
Minority Interest -- -- -- (183)
-------- -------- -------- --------
Net Income Available to Common Shares $ 1,238 $ 1,227 $ 1,203 $ 4,819
======== ======== ======== ========

Basic Earnings Available to Common Shares
per weighted-average Common Share:
Income before Net Gains and
Extraordinary Item $ 0.09 $ 0.09 $ 0.09 $ 0.07
======== ======== ======== ========

Net Income $ 0.09 $ 0.09 $ 0.09 $ 0.36
======== ======== ======== ========
Diluted Earnings Available to Common Shares
per weighted-average Common Share:
Income before Net Gains and
Extraordinary Item $ 0.09 $ 0.09 $ 0.09 $ 0.07
======== ======== ======== ========

Net Income $ 0.09 $ 0.09 $ 0.09 $ 0.36
======== ======== ======== ========

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

GENERAL

During the year ended December 31, 2000, we marketed our portfolio for
sale and began negotiating a contract with a potential purchaser. At
December 31, 2000, we owned individually or, in some cases, through joint
ventures:

. fourteen office properties totaling 1.5 million rentable square
feet;

. twelve flex industrial properties totaling 1.7 million rentable
square feet;

. one retail center which contains 321,600 rentable square feet.

We did not acquire or sell any properties during the year ended
December 31, 2000. During the year ended December 31, 1999, we sold four
apartment complexes containing 864 units and one flex industrial property
totaling 182,300 rentable square feet but did not acquire any properties.
During 1998, we acquired ten properties totaling 834,600 square feet but
did not sell any properties.

COMPARISON OF YEAR ENDED DECEMBER 31, 2000 TO YEAR ENDED DECEMBER 31, 1999

During the year ended December 31, 2000 and 1999 our income before
minority interest, net gains and extraordinary item totaled approximately
$3.1 million and approximately $5.1 million, respectively. Our total
revenue decreased by approximately $3.9 million or 9.4% to approximately
$37.8 million from approximately $41.7 million, due to a decrease in the
number of properties that we own and a decrease in total occupancy. This
decrease in total revenues was partially offset by a decrease in total
operating expenses, which include property operating, repairs and
maintenance, real estate taxes, and ground lease expenses; and a decrease
in interest expense. However, the decrease in total operating expenses and
interest expense in 2000 was partially negated by severance and termination
costs in the amount of approximately $1.9 million related to an employee
severance and retention policy (see Severance and Termination Costs below).

On a "same-store" basis (comparing the results of operations of the
properties owned during the entire year ended December 31, 2000 with the
results of the same properties owned during the entire year ended December
31, 1999), total revenue increased by approximately $0.5 million due to an
increase in rental rates.

As of December 31, 2000, 15% of our leasable square footage was vacant
and during 2001, leases for approximately fifteen percent (15%) of our
leasable square footage will expire. Although vacancy may increase
temporarily, at most of our properties we believe that this lease "roll-
over" is routine and the underlying space will be released at market rental
rates to either the existing or new tenants. Our most significant vacancy
is at 6901 Riverport Drive where a tenant occupying approximately 145,000
square feet or 45% of this property's space vacated on July 31, 2000. We
are in the process of marketing this space but have not secured a new
tenant. Our total revenues may be adversely affected if the space remains
vacant for an extended period of time. Since December 31, 2000, a major
tenant at Colonial Penn Building took occupancy of 21,850 square feet
increasing the occupancy of that property to 100%, and at the Lexington
Business Center two tenants took occupancy of 41,600 square feet increasing
that property's occupancy from 70% to 84%. In total, out of approximately
520,000 square feet that were vacant at December 31, 2000, and
approximately 148,000 square feet of leased space that expired during the
first two months of 2001, approximately 207,000 square feet have been
leased decreasing vacancy to approximately 460,000 square feet as of
March 1, 2001.

Our total expenses decreased by approximately $1.9 million to
approximately $34.7 million from approximately $36.6 million in 1999. This
decrease is due to a decrease in the number of properties that we own,
partially offset by approximately $1.9 million in severance and termination
costs that we incurred in 2000. Our total operating expenses which include
property operating, repairs and maintenance, real estate taxes, and ground
lease decreased by approximately $1.3 million to approximately $12.3
million from approximately $13.6 million in 1999. On the "same-store"
basis, our total operating expenses increased by approximately $0.7 million
or 6.0%. Interest expense decreased by approximately $2.4 million to
approximately $9.2 million from approximately $11.6 million primarily due
to a reduction in the amounts borrowed as a result of the 1999 property
dispositions and the conversion of our unsecured loan to Series A
convertible preferred shares in January 2000.

SEVERANCE AND TERMINATION COSTS

In September 2000, we adopted an employee severance and retention
program. We have since terminated certain employees and will continue to
review our staffing needs in the future. The total expenses for the year
ended December 31, 2000 include a charge of approximately $1.9 million for
this program. These costs include a charge of approximately $0.3 million
for base compensation payable to Mr. Leonard G. Levine from August 14, 2000
through December 31, 2001 under the terms of his employment agreement.
Subsequent to September 30, 2000, we entered into employment agreements
with Messrs. Schafran, Higgins and Teglia, and into separation agreements
with Messrs. Hansen and Schmidt. Pursuant to these separation agreements
and Mr. Teglia's new employment agreement, we paid a total of approximately
$0.8 million in severance and termination costs in the fourth quarter of
2000. These costs are included in the $1.9 million severance and
termination costs discussed above.

COMPARISON OF YEAR ENDED DECEMBER 31, 1999 TO YEAR ENDED DECEMBER 31, 1998

During the year ended December 31, 1999 and 1998 our net income
totaled approximately $8.5 million and approximately $5.4 million,
respectively. The approximately $3.1 million increase resulted primarily
from net gains on dispositions of investments in real estate of
approximately $4.1 million, and revenue growth of approximately $2.3
million reduced by expense growth of approximately $3.3 million. In
particular, our total revenues increased by approximately $2.3 million or
5.8% to approximately $41.7 million from approximately $39.4 million, due
primarily to an increase in the number of properties that we owned in 1999
compared to 1998. On a "same-store" basis (comparing the results of
operations of the properties owned during the entire year ended
December 31, 1999 with the results of the same properties owned during the
year ended December 31, 1998), net operating income decreased by
approximately $0.6 million with total revenues decreasing by approximately
$1.1 million offset by a decrease in total operating expenses of
approximately $0.5 million. The decrease in same store revenues was caused
by a decrease in the occupancy at four of our properties, the Lexington
Business Center, Phoenix Business Park, Elmhurst Metro Court, and Airways
Plaza Office Center. The average occupancy levels at these properties were
65%, 67%, 65%, and 41% during the year ended December 31, 1999,
respectively, compared to 85%, 96%, 76%, and 99% average occupancy levels
during the year ended December 31, 1998. The occupancy at these four
properties, as well as for our overall portfolio, was lower than our
historical levels as a result of the termination of several leases during
1998 and 1999.

Our total expenses increased by approximately $3.3 million primarily
due to an increase in the number of properties that we owned in 1999
compared to 1998. Our total operating expenses, which include property
operating, repairs and maintenance, real estate taxes, and ground lease
increased by approximately $0.2 million to approximately $13.6 million from
approximately $13.4 million in 1998. On a "same-store" basis, total
operating expenses decreased by approximately $0.4 million or 4.1% to
approximately $9.4 million from approximately $9.8 million. Interest
expense increased by approximately $1.8 million to approximately $11.6
million from approximately $9.8 million, primarily due to an increase in
the amount we borrowed in connection with the acquisitions that we
completed in 1998. General and Administrative expense decreased by
approximately $0.1 million to approximately $4.5 million from approximately
$4.6 million. Depreciation and Amortization expense increased by
approximately $1.4 million to approximately $6.6 million from approximately
$5.2 million which accounts for the remaining net increase in total
expenses.

LIQUIDITY AND CAPITAL RESOURCES

On January 5, 2001, we adopted a Plan of Termination and Liquidation
under which our Trust will be dissolved, the obligations of the Trust will
be paid, appropriate reserves will be taken and the net proceeds will be
distributed to our shareholders. On January 8, 2001, we entered into a
Purchase and Sale Agreement to sell all of our real estate assets to an
unaffiliated third party for $226 million plus the cost of all prepayment
penalties and assumption fees related to our mortgage debt ("Denholtz
Transaction"). The contract contains standard conditions to closing
including a due diligence period during which the buyer may terminate the
contract for any reason without penalty. The due diligence period ends
March 30, 2001 with a closing scheduled for April 30, 2001, unless extended
by the parties.

We cannot predict if, or when, we will ultimately be successful in
consummating the Denholtz Transaction or an alternative transaction, should
the current one terminate. However, if we are successful in completing a
transaction, it is our intention to establish only those essential reserves
needed to cover liquidation costs and contingent liabilities, including
those costs and contingent liabilities related to pending litigation.
Furthermore, it is our intention to distribute all cash proceeds from the
sale of our assets in excess of these reserves to our shareholders. We
expect to make a first distribution as soon as practical after the closing
and a final liquidating distribution before the end of 2001.

Until we are certain that all contingencies under the purchase and
sale contract are eliminated, that the buyer can terminate the contract
only under penalty and that a closing date for the sale of our assets is
scheduled, it is our intention to make regular quarterly distributions to
the extent that the distributions can be supported by our cash flow.
However, there can be no assurance that these distributions can be made
with regularity or that, if made, they will equal or exceed our previous
distribution levels.

In the event that we are unsuccessful in consummating the Denholtz
Transaction, we expect to fund our short-term liquidity needs, including
recurring capital expenditures, from our working capital (including the
restricted cash which is available for capital expenditures, real estate
taxes and insurance), and from income derived primarily from our property
operations. We anticipate using these monies to fund periodic tenant-
related capital expenditures and other capital improvements. We expect to
fund our long-term liquidity needs, including funds necessary for non-
recurring capital improvements and severance and termination costs from
long-term and short-term secured debt or from the proceeds from the sale of

assets. If we require additional liquidity to fund a portion of the cost
of improving properties in the future, we expect to borrow under our
present credit facility which is secured by our Johns Creek Office and
Industrial Park and Technology Park properties. As discussed below, we
will need to extend or replace this facility if the Denholtz Transaction is
delayed or terminated. We also have the ability to mortgage our Avalon
Ridge Business Park which is our only unencumbered property.

At December 31, 2000, our assets totaled approximately $196.1 million,
a decrease of approximately $10.5 million from total assets at December 31,
1999 of approximately $206.6 million. Our liabilities totaled
approximately $126.4 million at December 31, 2000 a decrease of
approximately $12.7 million from a total of approximately $139.1 million at
December 31, 1999. Our shareholders equity increased by approximately $2.1
million to approximately $67.4 million at December 31, 2000 from
approximately $65.3 million at December 31, 1999.

Cash and cash equivalents consist of cash and short-term investments.
Our cash and cash equivalents balance was approximately $2.4 million at
December 31, 2000 and approximately $13.1 million at December 31, 1999.
The decrease in total cash and cash equivalents resulted from using
approximately $6.1 million in investing activities and approximately $14.0
million in financing activities while receiving approximately $9.4 million
from operating activities.

Cash Flows From Operating Activities: Net cash provided by operating
activities decreased by approximately $1.4 million for the year ended
December 31, 2000 to approximately $9.4 million from approximately $10.8
million in 1999. This decrease is primarily due to a reduction in the
number of properties that we own. See Results of Operations above for
further discussion of the operations of our real estate assets.

In prior years, we have presented Funds From Operations ("FFO") and
Funds Available for Distribution ("FAD") in the Cash Flow from Operating
Activities section of Liquidity and Capital Resources for purposes of
allowing the reader of our financials to compare our results with those of
other REIT's. In light of our adoption of a Plan of Termination and
Liquidation, we will no longer present this information because our
operations are no longer comparable to other REIT's that are going
concerns. Therefore, while we operate pursuant to the Plan of Liquidation,
FFO and FAD will no longer be presented in our annual or quarterly filings.

Cash Flows From Investing Activities: During the year ended
December 31, 2000, we used approximately $6.1 million in investing
activities. Cash flow was primarily used to make capital improvements at
our various properties in the amount of approximately $6.4 million. In
comparison during the same period in 1999, we generated approximately $7.6
million from investing activities, primarily from proceeds from the sale of
investments in real estate. During the year ended December 31, 1999, we
sold four apartment complexes and one flex/industrial property resulting in
proceeds from sale of approximately $13.7 million (gross proceeds from sale
of approximately $29.9 million less approximately $16.2 million
representing debt assumed by the purchaser). We also made capital
improvements at our various properties in the amount of approximately $6.0
million.

Cash Flows From Financing Activities: During the year ended
December 31, 2000, we used approximately $14.0 million in financing
activities. We used cash primarily to make net payments on mortgage loans,
and on an unsecured loan payable of approximately $6.9 million and to pay
distributions to shareholders of approximately $6.8 million. During the
year ended December 31, 1999, we used approximately $9.1 million in
financing activities. During the year ended December 31, 1999, we used
cash primarily to make net payments on mortgage loans and bonds payable of
approximately $2.8 million and to pay distributions to shareholders of
approximately $6.5 million.

FINANCINGS:

On May 1, 2000, we entered into a loan agreement with LaSalle Bank
National Association (the "LaSalle Loan") which provided for a loan in the
amount of $12.1 million, which we can draw in four installments. The
amount of $8.5 million was drawn on May 1, 2000. An additional $2 million
was drawn on October 30, 2000. The loan, which is collateralized by our
Johns Creek Office and Industrial Park and Technology Park properties,
bears interest at a variable rate equal to LIBOR plus 2.2% and is payable
monthly. The loan principal is pre-payable without penalty and matures on
May 31, 2001. We utilized the proceeds from the first draw primarily to
repay the amounts outstanding on a line of credit which was due on May 1,
2000 and which was previously collateralized by our Johns Creek Office and
Industrial Park and Technology Park properties, and secondarily for
transaction costs. We used proceeds from the second draw primarily to pay
severance costs with the balance being used to fund tenant improvement
costs.

On October 8, 1999, we entered into a loan agreement with LaSalle Bank
N.A. in the amount of $7.8 million. The loan, which is collateralized by
the Trust's Lexington Business Center property, bears interest at a
variable rate equal to LIBOR plus 2% and is payable monthly. The loan
principal is pre-payable without penalty and had an initial maturity date
of May 31, 2000. We had two options to extend the term of the loan for one
year each at the same interest rate by paying a fee of $19,500 for each
extension. We exercised our first option to extend the term of the loan
until May 31, 2001.

In the event that the Denholtz Transaction is delayed or terminated,
we will exercise our final option to extend the Lexington loan and will
attempt to extend or replace the Johns Creek and Technology Park LaSalle
Loan.

As of December 31, 2000, we had borrowed $10.5 million on the LaSalle
Loan leaving approximately $1.6 million available for future borrowing. At
December 31, 2000, our debt to total market capitalization ratio was 58%
based upon the closing share price on that date of $5.50.

During the third quarter of 1998, we borrowed $7.4 million under a
convertible term loan agreement entered into with a group of lenders in
October 1997. On January 20, 2000, we paid conversion fee of $37,000 (0.5%
of the outstanding loan balance) and we repaid approximately $1.2 million
of the convertible term loan. The remaining balance of approximately $6.2
million was converted into 61,572 Series A convertible preferred shares at
a conversion rate of $100 per share and may be further converted into
common shares at a conversion rate of $5.15 per share.

RISK FACTORS

FACTORS PERTAINING TO PLAN OF TERMINATION AND LIQUIDATION

NO ASSURANCES THAT THE TRANSACTIONS CONTEMPLATED BY THE PURCHASE
AGREEMENT WILL CLOSE. On January 5, 2001, we adopted a Plan of Termination
and Liquidation (the "Plan") and on January 8, 2001, we entered into a
Purchase and Sale Agreement with Denholtz Management Corporation
("Denholtz") to sell all of our real estate assets (the "Purchase
Agreement"). The Purchase Agreement grants Denholtz until March 30, 2001,
the right to terminate the Purchase Agreement in its sole discretion.
Additionally, the Purchase Agreement gives Denholtz the right to exclude
certain properties if certain rental and other thresholds are not met.
Also, the closing of the transactions contemplated by the Purchase
Agreement are dependent on standard conditions to closing, one or more of
which may not occur.

There can be no assurance that the transactions contemplated by the
Purchase Agreement will ever close. If the transactions contemplated by
the Purchase Agreement do not close, we may not be able to sell all of our
assets in a timely manner and on financial terms that are as favorable as
those contained in the Purchase Agreement. Additionally, there can be no
assurance that Denholtz will purchase all of our properties. If Denholtz
does not purchase one or more of our properties, we may not be able to sell
those properties in a timely manner and on financial terms that are as
favorable as those contained in the Purchase Agreement. The consequence of
a termination of the Denholtz Transaction will be that any liquidating
distribution that was expected to be made from the net sale proceeds will
be delayed until another transaction or series of transactions can be
completed for all or part of our assets. In the interim, our ability to
make quarterly distributions will depend on the cash flow generated by our
properties less our corporate overhead.

Further, our failure to sell in a timely manner any properties that
Denholtz does not purchase increases the risk that we will make
distributions pursuant to the Plan after the 24 month anniversary of its
adoption. Any distributions made after January 5, 2003 will not qualify
for the dividends paid deduction thereby potentially subjecting us to tax
on our net income and net gains from dispositions. See, "We Might Fail to
Qualify as a REIT," below.

SALES OF ASSETS NOT SUBJECT TO SHAREHOLDER APPROVAL. The Denholtz
Transaction will not be submitted to a vote of our shareholders. We have
obtained written advice from our Massachusetts counsel and therefore we
believe that our Declaration of Trust grants the Trustees the authority,
without shareholder approval, to sell any and all of our assets on such
terms as the Board of Trustees determines appropriate, so long as such
sales are made pursuant to the Plan. On January 19, 2001, Leonard G.
Levine, our suspended president and chief executive officer, not
individually but on behalf of the shareholders of the Trust, filed a
lawsuit in the Circuit Court of Cook County, Illinois, alleging that the
Purchase Agreement and the transactions contemplated thereby require
shareholder approval. The complaint seeks an injunction against three of
our trustees to prevent them from closing the transaction until shareholder
approval is obtained. Although, based in part upon written advice we have
received from our Massachusetts counsel, we believe that our shareholders
are not required to approve the sale of our assets (and, the Purchase
Agreement requires our outside counsel to give an opinion to that effect),
there can be no assurance that Mr. Levine will not prevail in this lawsuit.

The pendency or the result of Mr. Levine's lawsuit may delay or abort the
closing of the transactions contemplated by the Purchase Agreement.

LIMITED MARKET FOR SHARES. If we fail to sell all of our properties
in accordance with the Purchase Agreement, and the value of our assets
decline or the costs and expenses related to such sales and to the
liquidation process exceed those we are currently estimating, the
liquidation may not yield distributions as great as, or greater than, the
recent market prices of our shares. No assurances can be made as to the
actual amount and timing of distributions, which could be made over a
substantial period of time.

DECREASING LIQUIDITY. As we sell our assets and distribute proceeds,
our market capitalization and "float" will diminish and market interest in
our shares by the investment community may diminish, thereby reducing or
effectively eliminating the market demand and liquidity for our shares,
which would adversely affect the market price for our shares. At a later
stage of the liquidation process, the Nasdaq National Market may cause our
shares to be delisted.

QUALIFICATION AS A REIT. The calculation of the estimated liquidation
price per share, assumes that we will continue to qualify as a REIT under
the Code during the entire liquidation process and, therefore, no provision
has been made for federal income taxes. Although we expect to maintain
such REIT qualification, there can be no assurance thereof. See "We Might
Fail to Qualify as a REIT" below.

RISKS OF ABANDONMENT OF PLAN. In the event the Plan is abandoned by
our Trustees (which may occur at any time during the liquidation process)
at a time when we are significantly reduced in size, certain operating
risks will increase, as will the risk that our share price will trade at a
greater discount to the perceived underlying value of its real estate
holdings.

REAL ESTATE RISKS

WE COMPETE FOR TENANTS. All of our office and flex industrial
properties are located in highly-developed areas that include other office
and flex industrial properties. Some of these properties are newer or
better located than our properties. Further, our competitors may have
greater resources than we do, which could allow them to reduce rents to a
level that is not profitable for us. We may also be required to spend
money upgrading or renovating our properties to make them attractive to
both existing and potential tenants thus increasing our expenses and
reducing our cash resources. The number of properties or other companies
that compete in our market areas could have a material effect upon:

. our ability to lease space at our properties;
. the amount of rent that we can charge on new leases or
renewals; and
. the dollar amount of tenant improvements or leasing commissions
required to lease a property.

WE OWN PROPERTIES IN A LIMITED NUMBER OF MARKETS. Our properties are
located in the Midwestern and Southeastern United States, primarily
suburban Chicago, where we own properties that account for 22% of our gross
rental revenue, and suburban Atlanta, where we own properties that account
for 31% of our gross rental revenue. Our ability to maintain or increase
our revenues or to generate revenues that exceed our operating expenses is
affected by economic conditions in the Midwestern and Southeastern United
States. Like other real estate markets, these markets have experienced
economic downturns in the past and will likely experience downturns in the
future. Layoffs or downsizing, industry slowdowns, changing demographics,
increases in the supply of property or reduced demand for office or flex
industrial space may decrease our revenues or increase our operating
expenses or both.

LEASES ON APPROXIMATELY 15% OF OUR RENTABLE SQUARE FEET EXPIRE DURING
2001 AND 15% OF OUR RENTABLE SQUARE FOOTAGE WAS VACANT AS OF DECEMBER 31,
2000. As leases expire, we may not be able to renew or re-lease space at
rates comparable to or better than the rates contained in the expiring
leases. Leases on approximately 15% of our rentable square feet will
expire prior to December 31, 2001. If we fail to renew or re-lease space
at rates that are at least comparable to the rates on expiring leases, the
revenues generated by our properties will decline. Further, we may have to
spend significant sums of money to renew or re-lease space covered by
expiring leases, potentially reducing the amount of money that we have
available to distribute to you or to use for other purposes.

OUR TENANTS MAY NOT PAY THEIR RENT OR MAY DECLARE BANKRUPTCY. We
derive substantially all of our revenue from leasing space at our
properties. Our ability to make distributions to you may be negatively
affected if tenants leasing a significant percentage of our rentable square
feet fail to pay their rent or if we are unable to profitably lease space.
We may experience substantial delays and incur significant expenses
enforcing our rights against tenants who do not pay their rent. A tenant
may also seek the protection of the bankruptcy laws and delay making rental
payments to us or actually reject or terminate its lease under those laws.
Even if a tenant did not seek the protection of the bankruptcy laws, the
tenant may from time to time experience a downturn in its business which
may weaken its financial condition and its ability to make rental payments
to us when due.

WE MAY NOT BE ABLE TO QUICKLY VARY OUR PORTFOLIO. Investments in real
estate are relatively illiquid. Except in certain circumstances, in order
to continue qualifying as a REIT, we are subject to rules and regulations
which limit our ability to sell properties within a short period of time.

WE ARE REQUIRED TO COMPLY WITH VARIOUS LAWS AND REGULATIONS. As an
owner of property, we are required to comply with a variety of federal,
state and local laws. Complying with these laws and regulations may
increase our operating expenses and reduce our profits. For example, we
are required to comply with laws and regulations that impose liability on a
property owner for the costs of removing or remediating certain hazardous
materials released on a property. We are subject to these laws even if we
are not aware of, or responsible for, releasing these materials. These
laws or regulations may also restrict the way that we can use a property or
the type of business which may be operated on the property. Further, if we
fail to comply with these laws or regulations by, for example, failing to
properly remediate a release of hazardous material, we may not be able to
sell the affected property or borrow money using the property as collateral
for a loan. We may also be required to pay money to individuals who are
injured due to the presence of hazardous materials on our property.
Although we are not aware of any hazardous materials at our properties,
these materials may exist and the cost of removing or remediating them may
be material and could adversely impact the value of the property affected.
We may also be required to pay the cost of removing or remediating
hazardous materials from a disposal or treatment facility to which we may
have shipped hazardous or toxic substances even if we never owned or
operated the disposal or treatment facility. Our properties must also
comply with the Americans with Disabilities Act. This act establishes
certain standards related to access to and use of properties by disabled
persons. We may be required, for example, to remove any barriers to
access. If we fail to comply, the U.S. government may fine us or we may be
required to pay damages to a disabled person. Complying with these
requirements may increase our expenses and changes in these requirements
may result in unexpected expenses.

OUR OBJECTIVES MAY CONFLICT WITH THOSE OF OUR JOINT VENTURE PARTNERS.
We own eight of our properties, or approximately 40% of our rentable square
footage, through controlling interests in joint ventures with various third
parties. Investments in joint ventures which own properties may involve
risks that are not otherwise present when we wholly own the property
directly or through one of our subsidiaries. For example, our co-venturer
may file for bankruptcy protection or may have economic or business
interests or goals which are inconsistent with our goals or interests.
Further, although in each of these ventures we own a controlling interest
and have authority over major decisions such as the sale or refinancing of
properties, we owe fiduciary duties to our partners that may cause us to
take actions we otherwise would not have taken.

WE MAY NOT HAVE ENOUGH INSURANCE. We carry comprehensive liability,
fire, flood, earthquake, extended coverage and rental loss policies that
insure us against losses at our properties with policy specifications and
insurance limits that we believe are reasonable. There are certain types
of losses, for example environmental, that we may decide not to insure
against since the cost of insuring for the loss is not economical. In
establishing our insurance strategy, we use our discretion in determining
the amount of coverage, the limits on this coverage and the deductibles
that apply to the coverage in an attempt to balance the amount of insurance
that we purchase and the cost of that insurance. We may, however, suffer
losses that exceed our insurance coverage. Further, inflation, changes in
building codes and ordinances or other factors such as environmental laws
may make it too expensive to repair or replace a property that has been
damaged or destroyed, even if covered by insurance.

PROPERTY TAXES MAY INCREASE. We are required to pay taxes based on
the assessed value of our properties as determined by various taxing
authorities such as state or local governments. These taxing authorities
may increase the tax rate imposed on a property or may reassess property
value, either of which would increase our operating expenses.

REAL ESTATE FINANCIAL RISKS

WE OFTEN NEED TO BORROW MONEY TO FINANCE OUR BUSINESS. Our ability to
internally fund our capital needs is limited since we must distribute at
least 95% of our net taxable income (excluding net capital gains) to our
shareholders to qualify as a REIT. Consequently, we often borrow money to
fund our operating or capital needs, and may borrow monies to satisfy the
95% distribution requirement. The documents which govern how we may
conduct our business do not limit the amount of money that we may borrow.
Borrowing money to fund operating or capital needs exposes us to various
risks. For example, our properties may not generate enough cash to pay the
principal and interest obligations on our loans or we may violate a loan
covenant that results in the lender accelerating the maturity date of a
loan. As of December 31, 2000, we owed a total of approximately $119.7
million, secured by mortgages on certain of our properties. If we fail to
make timely payments on our loans, including those cases where a lender has
accelerated the maturity date due to a violation of a loan covenant, the
lenders could foreclose on the properties securing their loans and we could
lose our entire investment in those properties. Once a loan becomes due,
we must either pay the remaining balance or borrow additional money to pay
off the maturing loan. We may not, however, be able to obtain a new loan,
or the terms of the new loan, such as the interest rate or payment
schedule, may not be as favorable as the terms of the maturing loan. Thus,
we may be forced to sell a property at an unfavorable price to pay off the
maturing loan or agree to less favorable loan terms. A total of $23.6 and
$4.2 million of our indebtedness matures on or before December 31, 2001 and
2002, respectively.

We occasionally enter into loans where the interest rate may
fluctuate. As of December 31, 2000, we owed approximately $22.5 million
that bore interest at variable rates. We may borrow additional amounts
that bear interest at variable rates. If interest rates increase, the
amount of interest that we are required to pay on these borrowings will
also increase. Any such increase would increase our operating expenses.

WE DEPEND ON A SMALL NUMBER OF KEY PERSONNEL. Our success depends, in
part, on the efforts of our principal executive officers, particularly
Messrs. Schafran, Higgins and Teglia. Although we have entered into
employment contracts with each of these individuals, the loss of their
services could have an adverse effect upon our operations.

THIRD PARTIES MAY BE DISCOURAGED FROM MAKING ACQUISITION OR OTHER
PROPOSALS THAT MAY BE IN YOUR BEST INTERESTS. Under our Declaration, no
single person or group of persons (an entity is considered a person) may
own more than 9.9% of our outstanding common shares. The employment
contracts we have with each of our senior executives may require us, in
certain circumstances, to make payments to these individuals if a "change
of control" occurs. These provisions may prevent or discourage a third
party from making a tender offer or other business combination proposal
such as a merger, even if such a proposal would be in the best interest of
our shareholders.

WE MIGHT FAIL TO QUALIFY AS A REIT. If we fail to qualify as a REIT,
we would not be allowed to deduct amounts distributed to our shareholders
in computing our taxable income and would incur substantially greater
expenses for taxes and would have less money available to distribute to
you. We would also be subject to federal income tax at regular corporate
rates as well as potentially the alternative minimum tax. Unless we
satisfied some exception, we could not elect to be taxed as a REIT for the
four taxable years following the year during which we were disqualified.
We may fail to qualify as a REIT if, among other things:

. less than 75% of the value of our total assets consists of real
estate assets, cash and government securities at the close of each fiscal
quarter;

. more than 5% of the value of our assets consists of securities
of any one issuer or we hold more than 10% of the outstanding voting
securities (subsequent to January 1, 2001, 10% of the value of the
securities) of any one issuer at the close of each fiscal quarter;

. less than 75% of our gross income is generated from rents from
real property, interest on obligations secured by mortgages, gain from the
sale of property, and certain other property-related revenue sources; or

. we fail to distribute at least 95% (subsequent to January 1,
2001, 90%) of our "REIT taxable income" to our shareholders.

If we fail to distribute enough money to satisfy the REIT
requirements, we may also have to pay a non-deductible excise tax. This tax
is equal to 4% of the amount in any year that our distributions are less
than the sum of 85% of our ordinary income in the current year plus 95% of
our net income from capital gains in the current year plus 100% of the
taxable income that we did not distribute in prior years.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

We do not engage in any hedge transaction or in the ownership of any
derivative financial instruments. To mitigate the impact of fluctuations
in interest rates, we generally maintained over 70% of our debt as fixed
rate in nature by borrowing on a long-term basis.

As of December 31, 2000, we had approximately $119.7 million of
outstanding long-term debt, of which $22.5 million bears interest at
variable rates. As of December 31, 2000, the weighted-average interest
rate on this variable rate debt was 8.33%. If interest rates on this
variable rate debt were to increase one percentage point (1%), interest
expense would increase by $225,000 on an annual basis.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

BANYAN STRATEGIC REALTY TRUST
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

PAGE
----

Report of Independent Auditors 28

Consolidated Balance Sheets, December 31, 2000 and 1999 29

Consolidated Statements of Income For the Years Ended
December 31, 2000, 1999 and 1998 31

Consolidated Statements of Shareholders' Equity For the
Years Ended December 31, 2000, 1999 and 1998 33

Consolidated Statements of Cash Flows For the
Years Ended December 31, 2000, 1999 and 1998 34

Notes to Consolidated Financial Statements 36

Schedule
--------
Consolidated Real Estate and
Accumulated Depreciation III

SCHEDULES NOT FILED:

All schedules other than those indicated in the above index are
omitted since the required information is not present or is not present in
amounts sufficient to require submission of the schedule or because the
information required is included in the consolidated financial statements
and notes thereto.

REPORT OF INDEPENDENT AUDITORS

THE SHAREHOLDERS
BANYAN STRATEGIC REALTY TRUST

We have audited the accompanying consolidated balance sheets of Banyan
Strategic Realty Trust as of December 31, 2000 and 1999, and the related
consolidated statements of income, shareholders' equity and cash flows for
each of the three years in the period ended December 31, 2000. Our audits
also included the financial statement schedule listed in the index at Item
8. 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 auditing standards
generally accepted in the 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
Banyan Strategic Realty Trust at December 31, 2000 and 1999, and the
consolidated results of its operations and its cash flows for each of the
three years in the period ended December 31, 2000, in conformity with
accounting principles generally accepted in the United States. Also, in
our opinion, the related financial statement schedule, when considered in
relation to the basic financial statements taken as a whole, presents
fairly in all material respects the information set forth therein.

ERNST & YOUNG LLP

Chicago, Illinois
February 1, 2001

BANYAN STRATEGIC REALTY TRUST

CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)

December 31, December 31,
2000 1999
------------- ------------

ASSETS
- ------

Investment in Real Estate Held for Sale, at cost:
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 36,445 $ 36,445
Building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148,608 148,608
Building Improvements. . . . . . . . . . . . . . . . . . . . . . . . . . 20,633 14,211
-------- --------
205,686 199,264
Less: Accumulated Depreciation . . . . . . . . . . . . . . . . . . . . . (21,511) (15,420)
-------- --------
184,175 183,844
-------- --------

Cash and Cash Equivalents. . . . . . . . . . . . . . . . . . . . . . . . . 2,393 13,097
Restricted Cash - Capital Improvements . . . . . . . . . . . . . . . . . . 1,200 1,497
Restricted Cash - Other. . . . . . . . . . . . . . . . . . . . . . . . . . 1,178 1,171
Interest and Accounts Receivable . . . . . . . . . . . . . . . . . . . . . 1,344 1,186
Deferred Financing Costs (Net of Accumulated Amortization
of $1,620 and $1,512, respectively). . . . . . . . . . . . . . . . . . . 1,219 1,568
Other Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,548 4,284
-------- --------
Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $196,057 $206,647
======== ========

BANYAN STRATEGIC REALTY TRUST

CONSOLIDATED BALANCE SHEETS - CONTINUED
(DOLLARS IN THOUSANDS)

December 31, December 31,
2000 1999
------------- ------------

LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Liabilities
Mortgage Loans Payable . . . . . . . . . . . . . . . . . . . . . . . . . . $115,452 $120,781
Bonds Payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,200 4,500
Unsecured Loan Payable . . . . . . . . . . . . . . . . . . . . . . . . . . -- 7,400
Accounts Payable and Accrued Expenses. . . . . . . . . . . . . . . . . . . 3,147 2,767
Accrued Real Estate Taxes Payable. . . . . . . . . . . . . . . . . . . . . 898 908
Accrued Interest Payable . . . . . . . . . . . . . . . . . . . . . . . . . 676 615
Unearned Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 578 922
Security Deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,439 1,203
-------- --------
Total Liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126,390 139,096
-------- --------

Minority Interest in Consolidated Partnerships . . . . . . . . . . . . . . 2,317 2,256

Shareholders' Equity
Series A Non-Voting Convertible Preferred Shares, No Par Value,
200,000 Shares Authorized, 61,572 Shares Issued and Outstanding. . . . . 6,157 --
Shares of Beneficial Interest, No Par Value,
Unlimited Authorization; 15,805,289 and 15,073,917 Shares
Issued, respectively . . . . . . . . . . . . . . . . . . . . . . . . . 124,559 120,707
Accumulated Deficit. . . . . . . . . . . . . . . . . . . . . . . . . . . . (52,856) (48,046)
Employees' Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,144) --
Treasury Shares at Cost, 1,522,649 Shares. . . . . . . . . . . . . . . . . (7,366) (7,366)
-------- --------
Total Shareholders' Equity . . . . . . . . . . . . . . . . . . . . . . . . 67,350 65,295
-------- --------
Total Liabilities and Shareholders' Equity . . . . . . . . . . . . . . . . $196,057 $206,647
======== ========

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

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED STATEMENTS OF INCOME
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

FOR THE YEARS ENDED DECEMBER 31,
---------------------------------------------
2000 1999 1998
---------- ---------- ----------

REVENUE
Rental Income. . . . . . . . . . . . . . . . . . . . . . $ 32,744 $ 36,705 $ 34,470
Operating Cost Reimbursement . . . . . . . . . . . . . . 3,961 3,635 3,491
Miscellaneous Tenant Income. . . . . . . . . . . . . . . 437 1,187 1,146
Income on Investments and Other Income . . . . . . . . . 654 189 309
-------- -------- --------
Total Revenue. . . . . . . . . . . . . . . . . . . . . . . 37,796 41,716 39,416
-------- -------- --------
EXPENSES
Property Operating . . . . . . . . . . . . . . . . . . . 4,587 5,392 5,762
Repairs and Maintenance. . . . . . . . . . . . . . . . . 3,979 4,318 4,041
Real Estate Taxes. . . . . . . . . . . . . . . . . . . . 2,823 2,957 2,720
Interest . . . . . . . . . . . . . . . . . . . . . . . . 9,180 11,558 9,778
Ground Lease . . . . . . . . . . . . . . . . . . . . . . 925 934 926
Depreciation and Amortization. . . . . . . . . . . . . . 6,923 6,629 5,212
General and Administrative . . . . . . . . . . . . . . . 4,098 4,496 4,614
Amortization of Deferred Financing Costs . . . . . . . . 292 313 272
Severance and Termination Costs. . . . . . . . . . . . . 1,873 -- --
-------- -------- --------
Total Expenses . . . . . . . . . . . . . . . . . . . . . . 34,680 36,597 33,325
-------- -------- --------
Income Before Minority Interest, Net Gains and
Extraordinary Item . . . . . . . . . . . . . . . . . . . 3,116 5,119 6,091
Minority Interest in Consolidated Partnerships . . . . . . (491) (538) (572)
-------- -------- --------
Income Before Net Gains and
Extraordinary Item . . . . . . . . . . . . . . . . . . . 2,625 4,581 5,519
Net Gains on Disposition of Investments in Real Estate . . -- 4,089 --
-------- -------- --------
Income Before Extraordinary Item . . . . . . . . . . . . . 2,625 8,670 5,519

Extraordinary Item, Net of Minority Interest of $25
in 1998. . . . . . . . . . . . . . . . . . . . . . . . . (42) (183) (141)
-------- -------- --------
Net Income . . . . . . . . . . . . . . . . . . . . . . . . 2,583 8,487 5,378
Less Income Allocated to Preferred Shares. . . . . . . . . (585) -- --
-------- -------- --------
Net Income Available to Common Shares. . . . . . . . . . . $ 1,998 $ 8,487 $ 5,378
======== ======== ========

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED STATEMENTS OF INCOME - CONTINUED
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

FOR THE YEARS ENDED DECEMBER 31,
-----------------------------------------------
2000 1999 1998
------------ ------------ ------------

Basic Earnings Available to Common Shares
per weighted-average Common Share:
Income before Net Gains and Extraordinary Item . . . . . $ 0.14 $ 0.34 $ 0.41
======== ======== ========

Net Income . . . . . . . . . . . . . . . . . . . . . . . $ 0.14 $ 0.63 $ 0.40
======== ======== ========

Diluted Earnings Available to Common Shares
per weighted-average Common Share:
Income before Net Gains and Extraordinary Item . . . . . $ 0.14 $ 0.34 $ 0.40
======== ======== ========

Net Income . . . . . . . . . . . . . . . . . . . . . . . $ 0.14 $ 0.63 $ 0.39
======== ======== ========

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

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998
(DOLLARS IN THOUSANDS)

Series A Non-Voting
Convertible Shares of
Preferred Shares Beneficial Interest Accumu-
------------------- --------------------- lated Employees' Treasury
Shares Amount Shares Amount Deficit Notes Shares Total
-------- -------- ---------- -------- -------- --------- -------- --------

Shareholders' Equity,
January 1, 1998 . . . . . . -- -- 14,761,850 $119,013 $(49,332) -- $ (7,366) $ 62,315

Issuance of Shares,
net of issuance costs . . . -- -- 150,645 859 -- -- -- 859
Net Income . . . . . . . . . -- -- -- -- 5,378 -- -- 5,378
Distributions Paid . . . . . -- -- -- -- (6,118) -- -- (6,118)
-------- -------- ---------- -------- -------- -------- -------- --------
Shareholders' Equity,
December 31, 1998 . . . . . -- -- 14,912,495 119,872 (50,072) -- (7,366) 62,434

Issuance of Shares,
net of issuance costs . . . -- -- 161,422 835 -- -- -- 835
Net Income . . . . . . . . . -- -- -- -- 8,487 -- -- 8,487
Distributions Paid . . . . . -- -- -- -- (6,461) -- -- (6,461)
-------- -------- ---------- -------- -------- -------- -------- --------
Shareholders' Equity,
December 31, 1999 . . . . . -- -- 15,073,917 120,707 (48,046) -- (7,366) 65,295

Issuance of Shares,
net of issuance costs . . . 61,572 6,157 731,372 3,852 -- -- -- 10,009
Employees' Notes,
net of repayments . . . . . -- -- -- -- -- (3,144) -- (3,144)
Net Income . . . . . . . . . -- -- -- -- 2,583 -- -- 2,583
Common Distributions Paid. . -- -- -- -- (6,808) -- -- (6,808)
Preferred Distributions
Paid. . . . . . . . . . . . -- -- -- -- (585) -- -- (585)
-------- -------- ---------- -------- -------- -------- -------- --------
Shareholders' Equity,
December 31, 2000 . . . . . 61,572 $ 6,157 15,805,289 $124,559 $(52,856) $ (3,144) $ (7,366) $ 67,350
======== ======== ========== ======== ======== ======== ======== ========

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

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)

FOR THE YEARS ENDED DECEMBER 31,
-------------------------------------------
2000 1999 1998
-------- -------- --------

CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income . . . . . . . . . . . . . . . . . . . . . . . . $ 2,583 $ 8,487 $ 5,378
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Extraordinary Item, Net of Minority Interest . . . . . . 42 183 141
Net Gains on Disposition of Investments in
Real Estate. . . . . . . . . . . . . . . . . . . . . . -- (4,089) --
Depreciation and Amortization. . . . . . . . . . . . . . 7,215 6,942 5,484
Minority Interest in Consolidated Partnerships . . . . . 491 538 572
Net Change In:
Restricted Cash - Other. . . . . . . . . . . . . . . . (7) 78 (419)
Interest and Accounts Receivable . . . . . . . . . . . (158) 287 (682)
Other Assets . . . . . . . . . . . . . . . . . . . . . (1,096) (1,684) (1,676)
Accounts Payable and Accrued Expenses. . . . . . . . . 380 147 767
Accrued Interest Payable . . . . . . . . . . . . . . . 61 (21) 340
Accrued Real Estate Taxes Payable. . . . . . . . . . . (10) (59) 171
Unearned Revenue . . . . . . . . . . . . . . . . . . . (344) 207 482
Security Deposits. . . . . . . . . . . . . . . . . . . 236 (172) 662
-------- -------- --------
Net Cash Provided By Operating Activities. . . . . . . . . 9,393 10,844 11,220
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of Real Estate Assets. . . . . . . . . . . . -- -- (55,874)
Proceeds From Sale of Investments in
Real Estate. . . . . . . . . . . . . . . . . . . . . . -- 13,655 --
Additions to Investment in Real Estate . . . . . . . . . (6,422) (5,984) (5,347)
Earnest Money Deposits . . . . . . . . . . . . . . . . . -- -- 75
Restricted Cash - Capital Improvements . . . . . . . . . 297 (90) (644)
-------- -------- --------
Net Cash Provided By (Used In) Investing Activities. . . . (6,125) 7,581 (61,790)
-------- -------- --------

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
(DOLLARS IN THOUSANDS)

FOR THE YEARS ENDED DECEMBER 31,
-------------------------------------------
2000 1999 1998
-------- -------- --------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Loans Payable. . . . . . . . . . . . . . . $ 10,500 $ 9,285 $108,709
Investment From (Distributions To) Minority Partners . . (430) (431) 338
Deferred Financing Costs . . . . . . . . . . . . . . . . (159) (117) (926)
Payment of Preferred Shares Issuance Costs . . . . . . . (30) -- --
Repayment of Employees' Notes. . . . . . . . . . . . . . 94 -- --
Principal Payments on Mortgage Loans,
Bonds Payable and Unsecured Loan Payable . . . . . . . (17,372) (12,116) (52,854)
Distributions Paid to Shareholders . . . . . . . . . . . (6,808) (6,461) (6,118)
Payment of Preferred Distributions . . . . . . . . . . . (585) -- --
Prepayment Penalties on Early Extinguishment of Debt . . (6) (54) (136)
Shares Issued, Net of Issuance Costs . . . . . . . . . . 824 835 859
-------- -------- --------
Net Cash Provided By (Used In) Financing Activities. . . . (13,972) (9,059) 49,872
-------- -------- --------
Net Increase (Decrease) In Cash and Cash Equivalents . . . (10,704) 9,366 (698)
Cash and Cash Equivalents at Beginning of Year . . . . . . 13,097 3,731 4,429
-------- -------- --------
Cash and Cash Equivalents at End of Year . . . . . . . . . $ 2,393 $ 13,097 $ 3,731
======== ======== ========
Supplemental Information:
Interest Paid During the Year. . . . . . . . . . . . . . $ 9,119 $ 11,579 $ 9,438
======== ======== ========
Non-Cash Financing Activities:
Debt assumed upon acquisition
of real estate . . . . . . . . . . . . . . . . . . . . $ -- $ -- $ 3,675
======== ======== ========
Real estate conveyed in exchange for
release of mortgage indebtedness . . . . . . . . . . . $ -- $ 16,136 $ --
======== ======== ========

Preferred Share Debt Conversion. . . . . . . . . . . . . $ 6,157 $ -- $ --
======== ======== ========
Employees' Notes . . . . . . . . . . . . . . . . . . . . $ 3,238 $ -- $ --
======== ======== ========

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

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2000
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

1. LIQUIDATION OF THE TRUST

On January 8, 2001, the Trust entered into a Purchase and Sale
Agreement to sell all its real estate assets to an unaffiliated third party
for $226 million plus the cost of all prepayment penalties and assumption
fees related to the Trust's mortgage debt. The contract contains standard
conditions to closing including a due diligence period during which the
buyer may terminate the contract for any reason without penalty. The due
diligence period ends March 30, 2001 with a closing scheduled for April 30,
2001, unless extended by the parties.

In anticipation of the sale of the Trust's real estate assets, the
Trustees on January 5, 2001 adopted a Plan of Termination and Liquidation
under which, the Trust will be dissolved, the obligations of the Trust will
be paid, appropriate reserves will be taken and the net proceeds will be
distributed to the shareholders. Effective as of January 5, 2001, the
Trust adopted the liquidation basis of accounting. The following
represents the unaudited pro forma Shareholders' Equity as of December 31,
2000 assuming the adoption of the liquidation basis of accounting as of
that date:

Shareholders' Equity at December 31, 2000
(Going concern basis) $67,350

Pro Forma adjustments to Liquidation Basis
Liquidation and Termination Costs (810)
Elimination of intangible assets (5,470)
-------
Pro Forma Shareholders' Equity at
December 31, 2000 (Liquidation
Basis) $61,070
=======

2. ORGANIZATION AND DESCRIPTION OF BUSINESS

Banyan Strategic Realty Trust (the "Trust") was organized in 1986 as a
business trust under the laws of the Commonwealth of Massachusetts. The
business of the Trust is the ownership and operation of real estate
properties. At December 31, 2000, the Trust owned twenty-seven properties
located principally in the Midwest and Southeast United States. See Note 8
for information with respect to the Trust's business segments.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying consolidated financial statements include the
accounts of the Trust, its wholly-owned subsidiaries and its controlled
Partnerships. In all of its partnerships, the Trust is the controlling
general partner and retains sole authority over all significant decisions.
All intercompany balances and transactions have been eliminated in
consolidation.

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

INVESTMENT IN REAL ESTATE

Costs incurred with respect to third parties for the acquisition,
development, construction and improvement of properties are capitalized.
Certain costs of yet-to-be acquired properties, including deposits and
professional fees, are capitalized as other assets. These costs are
subsequently capitalized as property acquisition costs or charged to
expense when it becomes apparent that acquisition of a particular property
is not probable. Repairs and maintenance are charged to expense when
incurred.

Depreciation of buildings is computed using the straight-line method
over the estimated useful lives of the assets, generally 40 years.
Depreciation of tenant improvements is computed using the straight-line
method over the shorter of the lease term or useful life. For the years
ended December 31, 2000, 1999 and 1998, depreciation expense amounted to
$6,091, $5,982 and $4,765, respectively.

The Trust recognizes impairment losses for its properties when
indicators of impairment are present and a property's expected undiscounted
cash flows are not sufficient to recover the property's carrying amount.

The Trust classifies its real estate properties as held for sale when
its Board of Trustees has authorized the sale and an active program to find
a buyer has been initiated. The Trust classified all of its properties as
held for sale as of December 31, 2000 in consideration of the Purchase and
Sale Agreement described in Note 1. As of December 31, 1999, none of the
properties were classified as held for sale.

DEFERRED FINANCING COSTS

Deferred financing costs are amortized over the term of the related
loans.

REVENUE RECOGNITION

Minimum rentals are recognized on a straight-line basis over the term
of the related leases. Additional rents in the form of operating expense
reimbursements for common area maintenance expenses and real estate taxes
are recognized in the period in which the related expenses are incurred.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Trust believes the carrying amount of its financial instruments
approximates fair value at December 31, 2000 and 1999, because (i) the
fixed rates on mortgage loans payable are comparable to rates currently
offered in the market, (ii) the rates on the line of credit and bonds
payable are variable and the terms are comparable to those currently
offered in the market and (iii) the maturities of the Trust's cash
equivalents are relatively short.

INCOME TAXES

For the years ended December 31, 2000, 1999 and 1998, the Trust
elected or will elect to be treated as a real estate investment trust
("REIT") under Internal Revenue Code Sections 856-860. In order to
qualify, the Trust is required to distribute at least 95% of its "REIT"
taxable income to shareholders, meet asset and income tests and comply with
certain other requirements.

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

As of December 31, 2000, Investment in Real Estate has a gross and net
basis of $205,686 and $184,175, respectively, for income tax purposes.
Additionally, investment in a liquidating trust with a tax basis of $675
has not been accorded any value for financial reporting purposes.

As of December 31, 2000, the Trust has a net operating loss carry-
forward of $16,029 which will expire in 2006 ($7,787), 2008 ($789), and
2012 ($7,453).

CASH EQUIVALENTS

The Trust considers all highly liquid debt instruments purchased with
a maturity of three months or less to be cash equivalents.

RESTRICTED CASH

Restricted cash represents amounts held by lenders to provide for
future real estate tax expenditures and tenant improvements, utility
deposits and security deposits. Certain of these amounts may be reduced
upon the fulfillment of certain conditions.

STOCK OPTIONS

The Trust has elected to follow Accounting Principles Board Opinion
No. 25, Accounting for Stock Issued to Employees (APB 25), in accounting
for its stock options. Under APB 25, no compensation expense is recognized
because the exercise price of the Trust's employee stock options equals or
exceeds the market price of the underlying stock at the date of grant.

USE OF ESTIMATES

The preparation of consolidated financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.

RECLASSIFICATIONS

Certain reclassifications have been made to the previously reported
1999 and 1998 consolidated financial statements in order to provide
comparability with the 2000 consolidated financial statements. These
reclassifications have not changed the 1999 or 1998 results.

4. EARNINGS PER SHARE

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

The following table sets forth the computation of basic and diluted earnings per share:

2000 1999 1998
---------- ----------- ----------

Numerator:
Income Available to Common Shares Before Net Gains
and Extraordinary Item . . . . . . . . . . . . . . . . . . . $ 2,040 $ 4,581 $ 5,519
Net Gains (a) . . . . . . . . . . . . . . . . . . . . . . . . -- 4,089 --
Extraordinary Item, Net of Minority Interest. . . . . . . . . (42) (183) (141)
---------- ---------- ----------
Net Income Available to Common Shares. . . . . . . . . . . $ 1,998 $ 8,487 $ 5,378
========== ========== ==========
Denominator:
Denominator for basic earnings per
weighted-average shares . . . . . . . . . . . . . . . . . . 14,182,800 13,468,514 13,307,658

Effect of dilutive securities:
Employee stock options. . . . . . . . . . . . . . . . . . . 4,717 6,558 28,603
Convertible debt. . . . . . . . . . . . . . . . . . . . . . -- -- 463,401
---------- ----------- -----------
Dilutive potential common shares. . . . . . . . . . . . . . . 4,717 6,558 492,004

Denominator for diluted earnings per share-adjusted
weighted-average shares and assumed conversions. . . . . 14,187,517 13,475,072 13,799,662
========== =========== ===========

Basic Earnings Available to Common Shares Per
weighted-average Common Share:
Income before Net Gains and Extraordinary Item . . . . . . . $ 0.14 $ 0.34 $ 0.41
Net Gains (a). . . . . . . . . . . . . . . . . . . . . . . . -- 0.30 --
Extraordinary Item, Net of Minority Interest . . . . . . . . -- (0.01) (0.01)
---------- ----------- -----------
Net Income . . . . . . . . . . . . . . . . . . . . . . . $ 0.14 $ 0.63 $ 0.40
========== =========== ===========
Diluted Earnings Available to Common Shares Per
weighted-average Common Share:
Income before Net Gains and Extraordinary Item . . . . . . . $ 0.14 $ 0.34 $ 0.40
Net Gains (a). . . . . . . . . . . . . . . . . . . . . . . . -- 0.30 --
Extraordinary Item, Net of Minority Interest . . . . . . . . -- (0.01) (0.01)
---------- ----------- -----------
Net Income . . . . . . . . . . . . . . . . . . . . . . . $ 0.14 $ 0.63 $ 0.39
========== =========== ===========

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

<FN>

(a) Net gains include gain on disposition of investment in real estate.

For purposes of the computation of diluted earnings per share, options to purchase common shares at $6.375 per
share that were outstanding during 2000, 1999 and 1998 were not included in the 2000 and 1999 computation and for
certain periods of the 1998 computation because the options' exercise price was greater than the average market price of
the common shares and, therefore, the effect would be antidilutive.

The effect of conversion of $7,400 of convertible debt was not included in the calculations since the effect was
antidilutive.

For additional information relating to convertible debt and employee stock options, see notes 5 and 12.

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

5. LONG-TERM DEBT

The Trust's long-term debt consists of the following at December 31,
2000 and 1999:

2000 1999
----------------------- -------------------------
Weighted Weighted
Average Average
Interest Interest
Balance Rate Balance Rate
--------- -------- --------- --------
Mortgage
loans . . . . $115,452 7.66% $120,781 7.48%
Bonds. . . . . 4,200 6.07% 4,500 5.53%
-------- -------- -------- --------
Total
collateralized
debt. . . . . $119,652 7.61% $125,281 7.41%
======== ======== ======== ========
Unsecured
loans . . . . $ -- -- $ 7,400 12.00%
======== ======== ======== ========

Mortgage loans of $97,152 had fixed interest rates that ranged from
6.95% to 8.89% at December 31, 2000 and $18,300 had a variable rate (8.85%
at December 31, 2000). Bonds payable consist of variable rate tax exempt
revenue bonds which bear interest equal to 6.07% at December 31, 2000.
Substantially all of the mortgage loans and bonds contain prepayment
penalties. During 2000 and 1999, the Trust recognized extraordinary losses
of $42 and $183, respectively, related to prepayments on refinanced debt
and the writeoff of unamortized financing costs. Substantially all of the
Trust's real estate is pledged as collateral for the mortgage loans and
bonds.

During 1998, the Trust borrowed $7.4 million pursuant to its $20
million 1997 Convertible Term Loan Agreement for an unsecured convertible
term loan (the "Unsecured Loan"). On January 20, 2000, the Trust repaid
$1,243 of the Unsecured Loan and the remaining balance of $6,157 was
converted into 61,572 Series A convertible preferred shares. The Series A
convertible preferred shares pay quarterly preferred dividends at rate of
10% per annum and are convertible into common shares at a conversion price
of $5.15 per share. Prior to conversion, the Unsecured Loan bore interest
at an annual interest rate of 12% payable quarterly and the Trust was
required to pay an annual fee equal to 2% of the amount outstanding on
October 14, of each year.

The principal balance of the Trust's long-term debt at December 31,
2000, is scheduled to be repaid as follows:

2001 . . . . . . . . . . . . . $ 23,608
2002 . . . . . . . . . . . . . 4,198
2003 . . . . . . . . . . . . . 13,494
2004 . . . . . . . . . . . . . 10,938
2005 . . . . . . . . . . . . . 1,734
Thereafter . . . . . . . . . . 65,680
--------
$119,652
========

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

6. INVESTMENT IN REAL ESTATE

DISPOSITION ACTIVITIES

QUANTUM BUSINESS CENTRE

On November 4, 1999, the Trust sold its interest in Quantum Business
Centre, a multi-tenant, flex/industrial property located in Jefferson
County, Kentucky, to a private investor for a price of approximately
$6,100. The Trust received cash proceeds, net of debt repayment, of
approximately $3,700 and recognized a gain of approximately $700.

OKLAHOMA APARTMENT PORTFOLIO

On December 16, 1999, the Trust sold its Oklahoma Apartment Portfolio
- - four separate apartment complexes totaling 864 units - for a price of
approximately $24,100. The Trust received net proceeds of approximately
$7,500 and recognized a gain of approximately $3,400. The bonds used to
finance the properties were assumed by the purchaser.

7. PRO FORMA INFORMATION (UNAUDITED)

The Trust did not acquire any properties during 2000 or 1999. The
following unaudited pro forma summary presents information as if the
Trust's 1998 property acquisitions had occurred at the beginning of that
year. The pro forma information is provided for information purposes only.

It is based on historical information and does not necessarily reflect the
actual results that would have occurred nor is it necessarily indicative of
future results of operations of the Company.

Year Ended
December 31,
------------
1998
--------

Total revenue . . . . . . . . . . . . . . . . . $ 42,260
Net income. . . . . . . . . . . . . . . . . . . $ 5,187
Basic earnings per share. . . . . . . . . . . . $ 0.39
Diluted earnings per share. . . . . . . . . . . $ 0.38

8. BUSINESS SEGMENTS

The Trust owns and operates real estate properties located principally
in the Midwest and Southeast United States. The Trust has three operating
segments corresponding to the three property types comprising its real
estate assets: flex/industrial, office and retail. As of December 31,
2000, the flex/industrial segment was comprised of twelve complexes with
long-term leases to approximately 180 tenants; the office segment was
comprised of fourteen office sites with long-term leases to approximately
270 tenants; and the retail segment was comprised of one retail center with
long-term leases to approximately 50 tenants. As of December 31, 1999, the
flex/industrial segment was comprised of thirteen complexes, the office
segment was comprised of fourteen office sites and the retail segment was
comprised of one retail center. Prior to the sale of the Oklahoma
Apartment Portfolio in December 1999, a fourth segment - the residential
segment - was comprised of four apartment complexes with 864 units. The
Trust's long-term tenants are in a variety of businesses and no individual
tenant is significant to the Trust's business when considered as a whole.

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

Information by business segments is set forth below:

2000 1999 1998
-------- -------- --------
Revenue
Flex/Industrial. . . $ 11,205 $ 11,416 $ 10,838
Office . . . . . . . 21,313 21,264 19,577
Residential. . . . . -- 4,168 4,170
Retail . . . . . . . 4,705 4,771 4,646
Corporate/Other. . . 573 97 185
-------- -------- --------
$ 37,796 $ 41,716 $ 39,416
======== ======== ========

Income (loss) before
net gains and
extraordinary item
Flex/Industrial. . . $ 2,857 $ 2,518 $ 3,787
Office . . . . . . . 4,686 5,177 5,124
Residential. . . . . -- 688 682
Retail . . . . . . . 576 736 550
Corporate/Other. . . (5,494) (4,538) (4,624)
-------- -------- --------
$ 2,625 $ 4,581 $ 5,519
======== ======== ========

2000 1999
-------- --------
Total Assets
Flex/Industrial. . . $ 69,176 $ 69,279
Office . . . . . . . 107,151 105,756
Residential. . . . . -- --
Retail . . . . . . . 17,444 18,125
Corporate/Other. . . 2,286 13,487
-------- --------
$196,057 $206,647
======== ========

2000 1999 1998
-------- -------- --------
Depreciation and
amortization
Flex/Industrial. . . $ 2,366 $ 2,252 $ 1,714
Office . . . . . . . 3,984 3,287 2,404
Residential. . . . . -- 552 534
Retail . . . . . . . 573 538 523
Corporate/Other. . . -- -- 37
-------- -------- --------
$ 6,923 $ 6,629 $ 5,212
======== ======== ========
Interest expense
Flex/Industrial. . . $ 2,954 $ 3,557 $ 2,669
Office . . . . . . . 4,914 5,540 4,524
Residential. . . . . -- 1,136 1,199
Retail . . . . . . . 1,312 1,325 1,338
Corporate/Other. . . -- -- 48
-------- -------- --------
$ 9,180 $ 11,558 $ 9,778
======== ======== ========

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

2000 1999 1998
-------- -------- --------
Additions to Investment
in Real Estate
Flex/Industrial. . . $ 1,906 $ 2,364 $ 32,942
Office . . . . . . . 4,473 3,257 31,533
Residential. . . . . -- 278 324
Retail . . . . . . . 43 85 69
Corporate/Other. . . -- -- 28
-------- -------- --------
$ 6,422 $ 5,984 $ 64,896
======== ======== ========

9. TRANSACTIONS WITH AFFILIATES

During the first eight months of 2000 and the years ended December 31,
1999 and 1998, the Trust paid no salary to, but purchased legal services
from an executive officer of the Trust. Fees for legal services totaled
$246, $331 and $391, respectively. The executive paid no rent, as such, to
the Trust for the use of office space or equipment but granted the Trust a
discount equal to approximately 20% compared to rates charged to third
parties for all time billed to the Trust by the executive and his
employees. The executive also reimbursed the Trust for the cost of two
full time and certain part time employees. As of September 1, 2000, this
executive signed an employment agreement whereby he became a full time
employee of the Trust.

10. DISTRIBUTIONS PAID AND PAYABLE

To qualify as a REIT, the Trust must distribute at least 95% of its
"REIT Taxable Income" to shareholders. For 1999, net operating losses of
$2,923 were utilized in meeting this requirement. A portion of the
distributions paid during the subsequent year may be allocable to taxable
income earned in the prior year.

The Trust has determined the shareholders' treatment for federal
income tax purposes to be as follows:

2000 1999 1998
------- ------- -------
Ordinary income . . . . . $ 5,652 $ 2,562 $ 5,978
Long-term capital
gain. . . . . . . . . . -- 3,899 --
Return of capital . . . . 1,741 -- 140
------- ------- -------
$ 7,393 $ 6,461 $ 6,118
======= ======= =======

On January 19, 2001, the Trust declared a cash distribution for the
quarter ended December 31, 2000 of $0.03 per share payable February 28,
2001 to shareholders of record on January 29, 2001.

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

11. LEASES

MINIMUM RENTALS UNDER OPERATING LEASES

The Trust receives rental income from the rental of retail, office and
flex/industrial space under operating leases. The following is the minimum
future base rentals (excluding amounts representing executory costs such as
taxes, maintenance and insurance) on operating leases for the Trust's
flex/industrial, office and retail projects held at December 31, 2000:

2001 . . . . . . . $ 30,909
2002 . . . . . . . 25,293
2003 . . . . . . . 19,769
2004 . . . . . . . 13,860
2005 . . . . . . . 7,736
Thereafter . . . . 12,295
--------
$109,862
========

No single tenant at the Trust's operating properties produced ten
percent or more of total income from property operating activities.

The Trust is subject to the usual business risks regarding the
collection of the above-mentioned rentals.

GROUND LEASE

The Trust owns a leasehold interest in a shopping center in Atlanta,
Georgia. The lease expires in 2067. The ground lease requires annual
lease payments of $600 through October 4, 2007 plus 7% of total annual
gross rental income commencing when gross rental income exceeds $2,000 from
the operations of the shopping center. The ground lease also requires that
the Trust pay property operating expenses, including real estate taxes.
The base rent is reset in 2007 based upon a market rent within a
contractually defined range.

12. OMNIBUS STOCK AND INCENTIVE PLAN

On May 14, 1997, the Board of Trustees (the "Board") adopted and on
July 8, 1997, the shareholders of the Trust approved, the 1997 Omnibus
Stock and Incentive Plan (the "Option Plan") which allows the Trust to make
stock-based awards as part of its employee and Trustee compensation
program. Under the Option Plan, the Trust is authorized to issue options
to purchase up to one million shares of beneficial interest in the form of
incentive stock options, non-statutory stock options, stock appreciation
rights, performance shares and units. On December 31, 1999, the
outstanding options issued under the Option Plan totaled 463,676. When the
shareholders elected three new trustees on December 13, 1999, the members
of the board of trustees as of October 1, 1997 no longer constituted a
majority of the members of the board. By definition, this reconstitution
of the board was a "Change of Control" within the meaning of the Employee
Stock Option Agreements. As a result, all outstanding employee options
became immediately exercisable in accordance with the terms of the option
agreements. At that time, the Board of Trustees offered all of the Trust's
current employees and advisors who held options, the opportunity to
exercise all their vested but unexercised options with the proceeds of a
loan from the Trust. Each loan is non-recourse and bears interest at an
annual rate of 6.5%. Each person was required to pledge all shares
purchased with the proceeds of the loan to secure the payment of principal

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

and interest on the loan. The loan program was available until January 12,
2000. On that date, employees borrowed approximately $3.2 million to
purchase 575,337 shares. The loans were originally scheduled to mature on
the earlier of January 11, 2005 or one month after the date that an
individual's employment is terminated. At that time, the employee would be
required to repay the loan and all accrued interest, or forfeit the shares
held as security for the loan. Under the employee severance and retention
program (see Note 14), the Trust extended the maturity date of the loans
for terminated employees to the date the last of the notes becomes due.

FIXED STOCK OPTIONS

The Board administers the Option Plan and has the authority to
determine, among other things, the individuals to be granted options, the
exercise price at which shares may be acquired, the number of shares
subject to options and the vesting requirements and the exercise period of
each option. The Board is granted discretion to determine the term of each
option granted under the Option Plan to employees, executives and Trustees,
but in no event will the term exceed ten years and one day from the date of
the grant.

A summary of the Trust's fixed stock option activity, and related
information for the years ended December 31, 1999 and 2000 follows:

Weighted
Shares Average
Subject Exercise Price
to Options Per Share
---------- --------------

Outstanding at December 31, 1998 . . . . . 485,676 $ 5.630

Options granted. . . . . . . . . . . . . -- --
Options exercised. . . . . . . . . . . . (2,000) 4.375
Options canceled . . . . . . . . . . . . (20,000) 5.710
------- -------

Outstanding at December 31, 1999 . . . . . 463,676 5.632

Options granted. . . . . . . . . . . . . 14,000 5.464
Options exercised. . . . . . . . . . . . (432,005) 5.648
Options canceled . . . . . . . . . . . . (8,002) 5.813
------- -------
Outstanding at December 31, 2000 . . . . . 37,669 $ 5.342
======= =======

Exercisable at 12/31/99 (a). . . . . . . 463,676 $ 5.632
Exercisable at 12/31/00. . . . . . . . . 27,669 $ 5.294

- ----------

(a) Due to the election of three new trustees, on December 13, 1999,
the members of the board as of October 1, 1997 no longer constituted a
majority of the members of the board. By definition, this reconstitution
of the board was a "Change of Control" within the meaning of the Employee
Stock Option Agreements. As a result, all outstanding employee options
became immediately exercisable in accordance with the terms of the option
agreements.

At December 31, 2000, options to purchase 369,002 shares were
available for future grant.

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

The weighted average grant date fair value of options granted in 2000
and 1998 was $.66 and $.54, respectively. The remaining weighted-average
contractual life of these options was 7.85 years. Exercise prices for
options outstanding at December 31, 2000 ranged from $4.08 to $6.75 per
share.

TARGET STOCK PRICE PERFORMANCE OPTIONS

The exercise price of each target stock price performance option
granted is equal to the market price of the Trust's common shares on the
date of grant and vests as the Trust's common share price achieves certain
pre-established targets which were set on the date of grant. In
conjunction with the 1998 signing of an employment agreement between the
Trust and its suspended President Leonard G. Levine (see Note 15), the
Board granted Mr. Levine stock options to purchase an aggregate of 150,000
shares of the Trust's common shares of beneficial interest at an exercise
price equal to $5.50 per share which options were exercised in 2000.

A summary of the Trust's target stock price performance option
activity, and related information for the years ended December 31, 1999 and
2000 follows:
Weighted
Shares Average
Subject Exercise Price
to Options Per Share
---------- --------------
Outstanding at December 31, 1998
and 1999 . . . . . . . . . . . . . . . . 150,000 $ 5.500
Options exercised. . . . . . . . . . . . . (150,000) $ 5.500
-------- --------
Outstanding at December 31, 2000 . . . . . -- --
======== ========

Pro forma information regarding net income and earnings per share is
required by SFAS No. 123 "Accounting for Stock Based Compensation", and has
been determined as if the Trust had accounted for all options granted under
the Option Plan using the fair value method of that statement. The fair
value for the fixed stock options was estimated at the date of grant using
the Black-Scholes option pricing model with the following weighted-average
assumptions for 2000 and 1998: risk free interest rates of 5.94% and
5.31%; expected dividend yields of 8.08% and 7.47%; volatility factors of
the expected market price of the Trust's common stock of 0.279 and 0.201;
and a weighted-average expected lives of the options of 2 years and 5
years, respectively. No options were granted during 1999. In addition,
the fair value for the target stock price performance options granted in
1998 was estimated at the date of grant using a modified Black-Scholes
option pricing model which, in addition to the required inputs above, takes
into consideration the target stock price (or barrier) which must be
attained.

The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options which have no vesting
restrictions and are fully transferable. In addition, option valuation
models, such as the Black-Scholes model, require the input of highly
subjective assumptions including the expected stock price volatility.
Because changes in the subjective input assumptions can materially affect
the fair value estimate, in management's view, the existing models do not
necessarily provide a reliable single measure of the fair value of the
options granted under the Plan.

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

The effects on 2000, 1999 and 1998 pro forma net income and pro forma
earnings per common share of amortizing to expense the estimated fair value
of stock options are not necessarily representative of the effects on net
income to be reported in future years due to such things as the vesting
period of the stock options, and potential for issuance of additional stock
options in future years. For purposes of pro forma disclosures, the
estimated fair value of the options is amortized to expense over the
options' vesting period.

The Trust's pro forma information is as follows:

Years Ended December 31,
------------------------------
2000 1999 1998
------ ------ ------
Pro forma net income . . . . . . . . $2,581 $8,260 $5,279
Pro forma basic earnings per share . $ 0.18 $ 0.61 $ 0.40
Pro forma diluted earnings
per share. . . . . . . . . . . . . $ 0.18 $ 0.61 $ 0.38

13. DISTRIBUTION REINVESTMENT AND SHARE PURCHASE PLAN

The Trust has established the Trust's Distribution Reinvestment and
Share Purchase Plan (the "DRIP Plan"). The DRIP Plan allows shareholders
of the Trust to: (i) automatically reinvest the cash distributions on all,
or part, of shares registered in their name; and (ii) make cash investments
of not more than $120 per calendar year. Shares purchased under the DRIP
Plan will be issued directly by the Trust at either: (i) 97% of the average
closing sales price of the shares as reported on the NASDAQ National Market
on the last five business days preceding the relevant investment date in
the case of reinvested cash distributions; or (ii) 100% of the
aforementioned average closing price in the case of cash investments. For
the years ended December 31, 2000, 1999 and 1998, the Trust issued 149,367,
161,422 and 141,321 shares of beneficial interest under the DRIP Plan and
received total proceeds of $797, $835 and $818, respectively.

14. SEVERANCE AND TERMINATION COSTS

In September 2000, the Trust adopted an employee severance and
retention program. The Trust has since terminated certain employees and
will continue to review its staffing needs in the future in consideration
of the adoption of the Plan of Termination and Liquidation (see Note 1).
The accompanying consolidated financial statements include a charge of
approximately $1,900 related to the severance and retention program. These
severance and termination costs include a charge of approximately $300
related to base compensation payable to Mr. Leonard Levine from August 14,
2000 through December 31, 2001 under the terms of his employment agreement
(see Note 17).

15. LITIGATION

BANYAN STRATEGIC REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

On December 6, 2000, Mr. Levine and the Trust, through their
respective attorneys, agreed to dismiss the arbitration action and Mr.
Levine's lawsuit challenging the arbitration and further agreed to resolve
all issues under Mr. Levine's employment contract within the Trust's
lawsuit against Mr. Levine in the Circuit Court of Cook County (the
"Employment Litigation"). The Trust has since filed an amended complaint
which seeks a declaratory judgment that the Trust has, and had, "just
cause" to terminate his employment contract as well as an accounting and
the disgorgement of all benefits received by Mr. Levine while in breach of
his fiduciary duties. The factual bases underlying the amended complaint
include allegations that (i) Mr. Levine caused the Trust to pay on his
account or reimburse him for expenses that were not reasonable, ordinary
and necessary business expenses and (ii) during negotiations between the
Trust and The Oak Realty Group, Inc. (an entity solely owned by Mr. Levine)
Mr. Levine attempted to pressure the Trust into accepting Oak's offer to
acquire the Trust by revealing to one of the trustees that Oak had entered
into certain confidentiality and exclusivity agreements which had the
effect of excluding potential purchasers and/or capital providers from
purchasing or providing financing to a potential purchaser of the Trust,
except through Oak.

On January 19, 2001, Mr. Levine filed an answer affirmative defenses
and counterclaim in the Employment Litigation. The pleading generally
denies that Mr. Levine breached his fiduciary duties, raises various
defenses and seeks a judgment in favor of Mr. Levine on the counterclaim
reinstating him to active employment status. Discovery in this case has
recently begun. The maximum potential liability in connection with Mr.
Levine's contract (inclusive of incentives but exclusive of base salary) is
estimated to be $1,800.

Additionally, on January 19, 2001, Mr. Levine filed two lawsuits in
the Circuit Court of Cook County. In the first action, Mr. Levine, suing
derivatively on behalf of the Trust's shareholders, seeks to enjoin
trustees Daniel Levinson, Stephen Peck and L.G. Schafran from completing
the pending sale of substantially all of the Trust's assets to Denholtz
Management Corporation until the Trust obtains approval of the transaction
from a majority of the Trust's shareholders. This matter has been removed
to the United States District Court for the Northern District of Illinois
and the Trust has intervened as an additional defendant.

The Trust is also involved in various litigation arising in the
ordinary course of business. It is management's opinion that the defense
of these matters and the potential liability are adequately protected by
insurance coverage. Although the final outcome of these matters cannot be
determined, based on the facts presently known, it is management's opinion
that the final resolution of these matters will not have an adverse effect
on the Trust's financial position or results of operations.

SCHEDULE III
BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 2000
(DOLLARS IN THOUSANDS)

Costs
Capitalized
Initial costs Subsequent Gross Amount at which Carried
to the Trust to Acquisition at December 31, 2000 (a)(b)(c)
---------------------- --------------- ---------------------------------
Building Building Building Accumu-
Property & Location/ & & & lated
Date of Construction/ Improve- Improve- Improve- Deprecia-
Date Acquired Land ments Land ments Land ments Total tion
- ------------------ ----------- ----------- ------ --------- ---------- ----------- ----------- ----------

Milwaukee
Industrial
Properties
Milwaukee, WI
1973-1980
4/30/93 $ 533 $ 5,242 $ -- $ 1,313 $ 533 $ 6,555 $ 7,088 $ 1,571

Elmhurst
Metro Court
Elmhurst, IL
1982
11/30/93 1,615 3,605 -- 813 1,615 4,418 6,033 941

Colonial Penn
Building
Tampa, FL
1984
3/22/94 1,190 7,366 -- 694 1,190 8,060 9,250 1,302

Florida Power
& Light
Building
Sarasota, FL
1991
3/22/94 1,700 8,367 -- 146 1,700 8,513 10,213 1,531

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

Costs
Capitalized
Initial costs Subsequent Gross Amount at which Carried
to the Trust to Acquisition at December 31, 2000 (a)(b)(c)
---------------------- --------------- ---------------------------------
Building Building Building Accumu-
Property & Location/ & & & lated
Date of Construction/ Improve- Improve- Improve- Deprecia-
Date Acquired/ Land ments Land ments Land ments Total tion
- ------------------ ----------- ----------- ------ --------- ---------- ----------- ----------- ----------

Willowbrook
Industrial Court
Willowbrook, IL
1979
6/16/95 $ 962 $ 2,961 $ -- $ 550 $ 962 $ 3,511 $ 4,473 $ 661

Northlake Tower
Shopping Center
Atlanta, GA
1983-1984
7/28/95 -- 17,144 -- 1,058 -- 18,202 18,202 2,634

Lexington
Business Center
Lexington, KY
1985
12/05/95 1,330 5,753 -- 2,468 1,330 8,221 9,551 1,307

Newtown Business
Center
Lexington, KY
1981-1982
12/5/95 355 3,234 -- 350 355 3,584 3,939 522

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

Woodcrest
Office Park
Tallahassee, FL
1967-1989
12/19/95 $ 3,080 $ 7,968 $ -- $ 3,082 $ 3,080 $ 11,050 $ 14,130 $ 2,011

Midwest Office
Center
Oakbrook Terrace, IL
1979
4/18/96 2,396 2,591 -- 578 2,396 3,169 5,565 570

6901 Riverport
Drive
Louisville, KY
1985
11/19/96 1,750 8,242 -- 94 1,750 8,336 10,086 864

Phoenix
Business Park
Atlanta, GA
1979
1/15/97 1,717 3,777 -- 1,123 1,717 4,900 6,617 475

Butterfield
Office Plaza
Oak Brook, IL
1974
4/30/97 4,813 10,255 -- 1,793 4,813 12,048 16,861 1,410

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

Technology Center
Huntsville, AL
1990
8/26/97 130 2,417 -- 292 130 2,709 2,839 236

University Square
Business Center
Huntsville, AL
1984-1987
8/26/97 1,387 5,950 -- 1,548 1,387 7,498 8,885 1,030

Airways Plaza
Office Center
Memphis, TN
1982
12/10/97 409 2,756 -- 467 409 3,223 3,632 269

Peachtree Pointe
Office Park
Norcross, GA
1982
1/20/98 712 3,858 -- 641 712 4,499 5,211 409

Avalon Center
Office Park
Norcross, GA
1997
3/20/98 585 3,803 -- 533 585 4,336 4,921 411

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

Costs
Capitalized
Initial costs Subsequent Gross Amount at which Carried
to the Trust to Acquisition at December 31, 2000 (a)(b)(c)
---------------------- --------------- ---------------------------------
Building Building Building Accumu-
Property & Location/ & & & lated
Date of Construction/ Improve- Improve- Improve- Deprecia-
Date Acquired Land ments Land ments Land ments Total tion
- ------------------ ------ ----------- ------ --------- ---------- ----------- ----------- ----------

Avalon Ridge
Business Park
Norcross, GA
1997
4/24/98 $ 539 $ 3,327 $ -- $ 384 $ 539 $ 3,711 $ 4,250 $ 257

Tower Lane
Business Park
Bensenville, IL
1979-1980
4/27/98 1,255 3,933 -- 310 1,255 4,243 5,498 356

Sand Lake
Tech Center
Orlando, FL
1984-1986
4/30/98 1,984 4,804 -- 242 1,984 5,046 7,030 372

Park Center
Orlando, FL
1982
4/30/98 997 2,755 -- 164 997 2,919 3,916 234

Metric Plaza
Winter Park, FL
1985
4/30/98 629 1,940 -- 70 629 2,010 2,639 158

University
Corporate Center
Winter Park, FL
1981-1987
4/30/98 3,207 7,022 -- 443 3,207 7,465 10,672 507

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

Costs
Capitalized
Initial costs Subsequent Gross Amount at which Carried
to the Trust to Acquisition at December 31, 2000 (a)(b)(c)
---------------------- --------------- ---------------------------------
Building Building Building Accumu-
Property & Location/ & & & lated
Date of Construction/ Improve- Improve- Improve- Deprecia-
Date Acquired Land ments Land ments Land ments Total tion
- ------------------ ------ ----------- ------ --------- ---------- ----------- ----------- ----------

Johns Creek
Office and
Industrial Park
Duluth and
Suwanne, GA
1990-1992
8/14/98 $ 890 $ 4,874 $ -- $ -- $ 890 $ 4,874 $ 5,764 $ 289

Technology Park
Norcross, GA
1977-1984
8/14/98 1,530 10,905 -- 1,024 1,530 11,929 13,459 749
------- -------- ----- -------- -------- -------- -------- --------
$36,445 $148,595 $ -- $ 20,646 $ 36,445 $169,241 $205,686 $ 21,511
======= ======== ===== ======== ======== ======== ======== ========
<FN>

- --------------------

(a) The aggregate cost of the above real estate at December 31, 2000 for Federal income tax purposes is
$205,686. For further details regarding encumbrances on the Trust's properties see Note 5, Long-Term Debt.

(b) Reconciliation of real estate owned:

BANYAN STRATEGIC REALTY TRUST
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED

2000 1999 1998
-------- -------- --------

Balance at Beginning of Year . . . . . . . . . . $199,264 $220,808 $156,020
Acquisitions During Year . . . . . . . . . . . . -- -- 59,549
Sale of Property (1) . . . . . . . . . . . . . . -- (27,528) --
Additions During Year. . . . . . . . . . . . . . 6,422 5,984 5,239
-------- -------- --------
Balance at End of Year . . . . . . . . . . . . . $205,686 $199,264 $220,808
======== ======== ========
<FN>
(1) In connection with the sale of Quantum Business Center and the Oklahoma apartment portfolio,
the Trust transferred $135 of net operating assets in 1999.

(c) Depreciation expense is computed using the straight line method. Rates used in the determination of
depreciation are based upon the estimated useful life of the asset, primarily 40 years.

2000 1999 1998
-------- -------- --------

Reconciliation of Accumulated Depreciation:

Beginning of Year. . . . . . . . . . . . . . . . $ 15,420 $ 11,399 $ 6,634
Depreciation Expense . . . . . . . . . . . . . . 6,091 5,982 4,765
Sale of Property . . . . . . . . . . . . . . . . -- (1,961) --
-------- -------- --------
Balance at End of Year . . . . . . . . . . . . . $ 21,511 $ 15,420 $ 11,399
======== ======== ========

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE

There have been no changes in, or disagreements with, the accountants
on any matter of accounting principles, practices or financial statement
disclosure.

PART III

ITEM 10. OUR TRUSTEES AND EXECUTIVE OFFICERS

The trustees and executive officers of the Trust are as follows:

Walter E. Auch, Sr. Trustee
Daniel Levinson Trustee
Stephen M. Peck Trustee
L.G. Schafran Interim President/
Chief Executive Officer and Trustee
Leonard G. Levine President
Robert G. Higgins First Vice President/
Chief Operating Officer
and General Counsel
Joel L. Teglia Executive Vice President/
Chief Financial Officer

WALTER E. AUCH, SR. Mr. Auch, age 79, has served as an independent
trustee since 1986. Mr. Auch served as the chairman and chief executive
officer of the Chicago Board of Options Exchange from 1979 to 1986. Prior
to that time, Mr. Auch was executive vice president, director and a member
of the executive committee of PaineWebber. Mr. Auch is a director of Pimco
Advisors L.P., Smith Barney Concert Series Funds, Smith Barney Trak Fund,
The Brinson Partners Funds, the Nicholas Applegate Funds, Semele Group,
Inc., and Legend Properties, Inc. and a trustee of Hillsdale College and
the Arizona Heart Institute.

DANIEL LEVINSON. Mr. Levinson, age 43, has served as an independent
trustee since 1999 and currently serves as chief financial officer for the
Oracle Investment Management Inc. From 1993 to 1999, Mr. Levinson was
employed by Morgens Waterfall, Vintadis and Company, Inc. as its chief
financial officer and specialized in the management and workout of real
estate and other investments in its investment funds. Before working at
Morgens, Mr. Levinson was a vice president at Sentinel Real Estate
Corporation, an institutional real estate investment manager. Prior to
joining Sentinel in 1988, Mr. Levinson was at KPMG Peat Marwick for over
six years. Mr. Levinson received a Bachelor of Science degree from Lehigh
University. Mr. Levinson is a certified public accountant and a member of
the American Institute of Certified Public Accountants.

STEPHEN M. PECK. Mr. Peck, age 66, has served as an independent
trustee since 1999 and currently maintains an investment office at Gilder,
Gagnon, Howe & Co. LLC. Mr. Peck is a director of Harnischfeger, Inc.,
Fresenius Medical Care and OFFIT Investment Funds. He is also a Chairman
of the Advisory Board of the Torrey Funds and a member of the Advisory
Board of Brown Simpson Asset Management. Mr. Peck serves as a member of
the Board of Trustees of New York University, The Jewish Theological
Seminary and Mount Sinai School of Medicine and is Chairman of the Board of
Trustees of Mount Sinai-NYU Health.

L.G. SCHAFRAN. Mr. Schafran, age 62, has served as a trustee since
1999 and as our interim president and chief executive officer since
August 14, 2000. He is currently chairman of our board and has been a
Managing General Partner at L.G. Schafran & Associates since 1984. Mr.
Schafran is a director of Tarragon Realty Investors, Inc. (f/k/a National
Income Realty Trust), PubliCARD, Inc. (f/k/a Publicker Industries, Inc.),
COMSAT Corporation and chairman of the board of Delta-Omega Technologies,
Inc. Mr. Schafran served as a director of Capsure Holdings Inc. from 1986
to 1997, OXIGENE, Inc. from 1993 to 1996, Glasstech, Inc. from 1995 to
1997, Dart Group Corporation from 1993 to 1997 and Kasper A.S.L., Ltd. from
1997 to 2000.

ROBERT G. HIGGINS. Mr. Higgins, age 49, has served as our vice
president and general counsel since 1992 and as secretary since 1995.
Effective December 14, 2000, Mr. Higgins became our first vice president,
general counsel, chief operating officer and assistant secretary.
Mr. Higgins received a B.A. degree in government from the University of
Notre Dame and a law degree from Loyola University of Chicago. Mr. Higgins
concentrates his practice in the areas of real estate development, finance,
acquisition, land use, sales, lending and general corporate business
practice. Mr. Higgins previously served as vice president, general counsel
and secretary of Legend Properties, Inc. (f/k/a Banyan Mortgage Investment
Fund), Banyan Short Term Income Trust and Semele Group, Inc. (f/k/a Banyan
Strategic Land Fund II) (collectively, the "Banyan Funds")and is currently
serving in the same position for BSRT Management Corp. Mr. Higgins is
admitted to the bar in the States of Illinois, Minnesota and Texas and also
practices law as a sole practitioner.

JOEL L. TEGLIA. Mr. Teglia, age 39, has served as our vice president
and chief financial officer since 1994. Effective December 14, 2000, Mr.
Teglia became our executive vice president and chief financial officer.
Previously he served as vice president and chief financial officer of each
of the Banyan Funds and is currently serving in the same position for BSRT
Management Corp. Prior to his appointment, Mr. Teglia provided various
services to us in his capacity as controller for BSRT Management Corp.
(f/k/a Banyan Management Corp.), a position that he held from 1991 to 1994.

Mr. Teglia is a director of Brass Fund, Inc. Mr. Teglia received a B.A.
degree in accounting from the University of Notre Dame and is a certified
public accountant.

LEONARD G. LEVINE. Mr. Levine, age 53, has been our president and
chief executive officer since 1990. On August 14, 2000, we suspended Mr.
Levine from his duties as president and chief executive officer. Mr.
Levine also served as a trustee of ours from September, 1986 until February
1990 and again from 1998 to 2000. Mr. Levine received a bachelors of
science/bachelors of arts degree in accounting from Roosevelt University
and a masters degree in taxation from DePaul University. Mr. Levine
previously served as president of the Banyan Funds. Mr. Levine is a
certified public accountant and a licensed real estate broker.

ITEM 11. COMPENSATION OF TRUSTEES AND EXECUTIVE OFFICERS

A. INDEPENDENT TRUSTEE COMPENSATION

Each independent trustee is paid an annual fee of $20,000, payable
quarterly, plus $1,000 for each board or committee meeting attended in
person and $500 an hour for each board or committee meeting held by
telephonic conference call. We also reimburse each independent trustee for
out-of-pocket expenses incurred in attending board meetings. Each person
serving as an independent trustee is awarded an option to purchase 2,000 of
our common shares ten days after each annual meeting. All options granted
to the independent trustees vest and become exercisable in the following
installments: (1) fifty percent (50%) on the first anniversary of the
grant; and (2) fifty percent (50%) on the second anniversary of the grant.

In February 2000, our board formed a financial advisory committee to
evaluate and explore strategic alternatives designed to maximize
shareholder value. The financial advisory committee was comprised of
Messrs. Auch, Peck, Levinson and Schafran and has met 24 times in 2000.
The financial advisory committee was disbanded on December 21, 2000,
following the annual meeting of shareholders on December 14, 2000. The
financial advisory committee was deemed no longer necessary because, as of
December 14, 2000, the membership of the financial advisory committee and
the full board were identical.

B. EXECUTIVE COMPENSATION

This table shows compensation paid to our chief executive officer and
our next three most highly compensated executive officers during the last
three years ended December 31, 2000.

(a) (b) (c) (d) (e) (f) (g) (h) (i)
ANNUAL COMPENSATION LONG-TERM COMPENSATION
----------------------------- ----------------------------------
AWARDS PAYOUTS
----------------------- -------
OTHER RESTRICTED SECURITIES
NAME AND ANNUAL STOCK UNDERLYING LTIP ALL OTHER
PRINCIPAL SALARY BONUS COMPENSATION AWARD(S) OPTIONS/ PAYOUTS COMPENSATION
POSITION YEAR (2)($) ($) ($) ($) SARS(#) ($) ($) (4)
- -------- ---- ------ ----- ------------ ---------- ---------- ------- ------------

L. G. Schafran,
Interim President and
Chief Executive Officer 2000 $ 73,077 $ 0

Leonard G. Levine,
President and
Chief Executive Officer
(Suspended August 14,
2000)(1)(3). . . . . . . 2000 $215,100 $ 0
1999 $212,217 $101,471
1998 $206,100 $146,382

Jay E. Schmidt
Vice President-
Investments. . . . . . 2000 $145,957 $ 0 $280,807
1999 $183,053 $ 40,000
1998 $170,307 $ 41,908

Neil D. Hansen
First Vice President . . 2000 $131,525 $ 0 $342,679
1999 $220,732 $ 50,000
1998 $205,860 $ 48,990

Joel L. Teglia
Executive Vice President
and Chief Financial
Officer. . . . . . . . . 2000 $152,942 $ 0 $204,765
1999 $143,208 $ 30,000
1998 $126,825 $ 30,755

<FN>

(1) As of the fiscal year ended December 31, 2000, Mr. Levine owned 862,504 shares of beneficial interest,
512,504 of which he is restricted from transferring except in compliance with the registration requirements of
federal and state securities laws and 350,000 of which are pledged as collateral for his employee stock loan. The
value of these shares as of December 31, 1999, without any discount for the transfer restrictions was $4,743,772.

(2) Includes the lesser of 3% of base compensation or $4,800 which was contributed by us to each employee's
401(k) plan. For 1999, due to timing of our bi-weekly pay periods, salary paid includes 1999 salary plus 1/26th
of 1998's salary.

(3) On August 14, 2000, we exercised our rights under our employment agreement with Mr. Levine, by suspending
him and placing him on leave from his position as president. To replace Mr. Levine, our board of trustees has
appointed Larry Schafran to the position of interim president and chief executive officer. Mr. Schafran was also
elected to the position of chairman of the board of trustees on October 13, 2000.

(4) Represents severance payments in settlement of Messrs. Hansen, Schmidt and Teglia's employment agreements
dated December 31, 1998. These amounts include 2000 bonus payments of $30,903 for Mr. Schmidt, $38,725 for Mr.
Hansen and $26,765 for Mr. Teglia.

EMPLOYMENT AGREEMENTS.

MR. LEVINE. We entered into an employment agreement with Mr. Levine
on March 11, 1998, although the agreement became effective retroactively as
of October 1, 1997. This term of the agreement expires on December 31,
2001. On December 14, 1999 we amended Mr. Levine's employment agreement to
provide for certain rights upon liquidation of the Trust and the immediate
vesting of all outstanding options. Under the agreement, we agreed to pay
Mr. Levine a base salary equal to $200,000 per year through December 31,
1999 increasing to $210,000 per year during the last two years of the
agreement. The agreement also grants Mr. Levine the ability to earn annual
incentive compensation equal to 62.5% of the base salary each year,
provided that we achieve certain predetermined levels of "funds from
operations" increased by .03 for each one percentage point that our actual
per share "funds from operations" exceed the target and decreased (but not
below zero) by .04 for each one percentage point our actual per share
"funds from operations" is below the target amount.

Mr. Levine was also granted options to purchase 350,000 shares at an
exercise price equal to $5.50 per share. The number of shares underlying
the options and the exercise price of each option is subject to adjustment
from time to time if we: (1) issue or sell additional common shares in
exchange for consideration at a price less than the prevailing market price
of our shares; (2) issue or sell warrants with exercise prices less than
the prevailing market price; (3) declare a dividend or otherwise make a
distribution to our shareholders in the form of additional common shares;
(4) subdivide our outstanding common shares into a larger number of common
shares; or (5) combine our outstanding common shares into a smaller number
of common shares. Mr. Levine exercised all of the options on January 12,
2000. The agreement also requires us to provide Mr. Levine with both life
and disability insurance benefits during the term of the agreement, as well
as all non-wage benefits we provide to our other salaried employees.

Mr. Levine's agreement contains provisions that requires us to make
certain payments to him upon the occurrence of a "Triggering Event" which
is defined as:

. the date that a Plan of Liquidation of the Trust becomes effective;
. the date on which we sell all or substantially all of our assets;
. the date we merge or enter into a business combination with another
entity if, among other things, we are not the surviving entity; or
. the members of the existing board fail to constitute a majority of
the board.

The agreement also gives us the right to terminate or suspend Mr.
Levine under certain circumstances. On August 14, 2000, we suspended Mr.
Levine pursuant to our employment agreement with him and have filed a
lawsuit alleging that Mr. Levine breached certain fiduciary duties owed to
us and that he committed intentional acts that caused material damage to
our business or properties. Pending a final ruling by a court, we will
comply with the employment agreement including the compensation provisions.

To replace Mr. Levine, our board of trustees appointed Larry Schafran to
the position of interim president and chief executive officer.

MR. SCHAFRAN. On August 14, 2000, following the suspension of Mr.
Levine, we engaged Mr. Schafran to become our interim president and chief
executive officer. On October 26, 2000, we entered into an employment
agreement with Mr. Schafran, the term of which extends until February 13,
2002, unless sooner terminated for "cause," by death or disability,
voluntarily by Mr. Schafran, upon a "change in control" of the Trust, or
upon Mr. Levine's reinstatement as our president and chief executive
officer.

Under the agreement we will pay Mr. Schafran an annual base salary of
$200,000 and an incentive bonus based on the present value of aggregate
distributions we make to shareholders during the term of the agreement. We
will pay the incentive bonus once our shareholders receive distributions
whose aggregate present value is at least $6.25 per share discounted to
October 26, 2000 at 12%. The amount of incentive bonus starts at $300,000
and increases as the present value of distributions to our shareholders
increases. Additionally, in lieu of the incentive bonus, Mr. Schafran
could have received an early completion bonus equal to $300,000 if our
shareholders received distributions greater than $6.00 per share on or
before December 31, 2000. The early completion bonus is reduced to
$225,000 if our shareholders receive distributions greater than $6.00 per
share after December 31, 2000 but on or before March 31, 2001.

If we terminate Mr. Schafran's employment because Mr. Levine is
reinstated to his former position, we are obligated to pay Mr. Schafran his
entire incentive bonus, based on the present value of the aggregate
distributions made to our shareholders, as though his employment had not
been terminated. Additionally, if we terminate Mr. Schafran's employment
due to his death, disability or a "change in control," we are obligated to
pay Mr. Schafran a portion of the incentive compensation equal to the
amount of incentive compensation he would have earned had we not terminated
his employment, multiplied by a fraction, the numerator of which is the
number of days he had served as our interim president and chief executive
officer and the denominator of which is 548. Finally, if we terminate the
agreement upon our final dissolution and liquidation, we are obligated to
pay Mr. Schafran the amount of base salary he would have earned through
February 13, 2002 and any earned but unpaid incentive bonus based on the
present value of the amount distributed to our shareholders under the plan
of liquidation.

MR. HIGGINS. Effective on September 1, 2000, we entered into an
employment agreement with Mr. Higgins whereby he became our first vice
president, general counsel and chief operating officer until October 31,
2002. Mr. Higgins' employment agreement may be terminated prior to its
expiration as follows: (1) by us for "cause"; (2) by us upon 60 days prior
written notice; (3) by our complete dissolution and liquidation; (4) by Mr.
Higgins' death or disability; or (5) voluntarily by Mr. Higgins. Under the
agreement, Mr. Higgins becomes our full-time employee, however, he is
allowed to perform legal services for clients. Mr. Higgins' initial base
salary is $260,000 with automatic 5% increases on January 1, 2001 and 2002.

Unless we terminate Mr. Higgins' employment for "cause" or Mr. Higgins
terminates it voluntarily, upon expiration of the term of the agreement, we
will pay Mr. Higgins a severance payment of one year's salary and a bonus
equal to 50% of the aggregate amount of base salary Mr. Higgins earned from
November 1, 2000 to the end of the agreement. "Cause" is defined in the
agreement as: (1) conduct amounting to fraud or wilful misconduct, (2) any
material act of dishonesty, (3) the conviction of Mr. Higgins of a felony
crime, and (4) a material breach of the agreement by Mr. Higgins which
remains uncured for a period of five business days following notice of such
breach. Additionally, Mr. Higgins may terminate the agreement if: (A) the
members of our board as of the date of the agreement fail to constitute a
majority of the board; (B) our shareholders adopt a plan of liquidation
without our board's approval or recommendation; (C) we sell all of our real
estate properties or business; (D) we combine with another entity and our
shareholders immediately prior to the combination fail to retain a majority
of the voting securities of the surviving entity; (E) any person or entity
becomes the beneficial owner of a majority of our voting shares; (F) we
relocate our executive offices to a location in excess of 100 miles outside
of the Chicago Loop area; (G) we breach the agreement in a material respect
which we fail to cure within five business days of notice of such breach;
and (H) a material diminution of Higgins' duties, responsibilities or
authority occurs.

MESSRS. HANSEN, SCHMIDT AND TEGLIA. We also had employment agreements
with each of Messrs. Hansen, Schmidt and Teglia. Pursuant to these
agreements, we were obligated to pay Messrs. Hansen, Schmidt and Teglia
annual base salaries equal to $213,040, $176,680 and $138,240 respectively.

On October 1, 2000 we entered into agreements with Messrs. Schmidt and
Hansen terminating their employment and settling all claims for severance
pay. On November 1, 2000 we entered into a new employment agreement with
Mr. Teglia.

MR. TEGLIA. On November 1, 2000, we entered into a new agreement with
Mr. Teglia whereby he became our executive vice president and chief
financial officer following the annual meeting until October 31, 2002. Mr.
Teglia's agreement may be terminated for the same reasons enumerated in Mr.
Higgins' agreement. Upon execution of the agreement, we paid to Mr. Teglia
a severance payment of $204,765 in settlement of our obligations to him
under his prior employment agreement. Under the new agreement, Mr.
Teglia's initial annual base salary is $181,120, which is increased to
$200,000 on January 1, 2001 and $210,000 on January 1, 2002. Additionally,
unless we terminate Mr. Teglia's employment for "cause" or Mr. Teglia
terminates it voluntarily, upon expiration of the term of the agreement, we
will pay Mr. Teglia a bonus equal to 50% of the aggregate amount of base
salary Mr. Teglia earned during the term of the agreement. The definition
of "cause" in Mr. Teglia's agreement is identical to the definition set
forth in Mr. Higgins' agreement.

STOCK OPTION GRANTS

We did not grant any options to purchase shares of beneficial interest
during the year ended December 31, 2000 to any of our executive officers.
On December 26, 2000 we granted options to purchase shares of beneficial
interest to each of our independent trustees in accordance with our
Executive and Director Stock Option Plan. The table below sets forth the
aggregated option exercises and year-end option value for 2000.

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUE
---------------------------------------------------
(a) (b) (c) (d) (e)
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
FY-End (#) FY-End ($)
Shares
Acquired on Value Exercisable/ Exercisable/
Name Exercise Realized Unexercisable Unexercisable
- ---- ----------- --------------------------- ---------------

Leonard G. Levine. . 350,000(1) $ 65,800 0 / 0 $0 / $0

Larry G. Schafran. . -- --

Jay E. Schmidt . . . 3,334 $ 4,528 0 / 0 $0 / $0
36,000(1) $ 0

Neil D. Hansen . . . 3,334 $ 4,318 0 / 0 $0 / $0
36,000(1) $ 0

Joel L. Teglia . . . 29,000(1) $ 0 3,335 / 0 $4,736 / $0

Note 1. Represents options exercised with the proceeds from a non-recourse
loan offered by the company to its employees as of December 31, 1999 at an
annual rate of interest of 6.5%.

All of the options granted vested on December 13, 1999 because there
occurred a "change in control" as that term was defined in our Executive
and Director Omnibus Stock Option Plan. The "change in control" occurred
because on that date, the members of our board as of the effective date of
the Plan failed to constitute a majority of the members of our board. In
addition, in December 1999, we offered all of our current employees and
advisors who hold options the opportunity to exercise all of the vested but
unexercised options with the proceeds of a loan from us. Each loan is non-
recourse and bears interest at an annual rate of 6.5%. Each person is
required to pledge all shares purchased with the proceeds of the loan to
secure the payment of principal and interest on the loan. We loaned
approximately $3.2 million to these persons. All loans will mature in five
years; provided that any person who terminates his or her employment or
whom we terminate is required to repay the loan and all accrued interest
by surrendering the shares securing the loan or by tendering sufficient
funds to pay all amounts owing within one month of terminating employment.
Pursuant to our Severance and Retention Program for non-contract employees,
we have extended the term of any note made by a terminated employee or will
extend the term of any note made by any other employee we choose to
terminate, to the date upon which the last of these notes comes due.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information as of February 16, 2001
regarding the number and percentage of our outstanding common shares
beneficially owned by: (1) each trustee; (2) each executive officer; and
(3) all trustees and executive officers as a group. The table also sets
forth information as of December 31, 2000 with respect to any person known
to us to be the beneficial owner of more than five percent of our
outstanding common shares. Information with respect to Morgens Waterfall
Income Partners, L.P., Kensington Investment Group, Inc., and Magten Asset
Management Corp. listed in the table below, including the notes, is based
solely on copies of statements filed under Section 13(d) or 13(g) of the
Exchange Act, and we have not independently confirmed this information.
Share amounts and percentages shown for each person or entity are adjusted
to give effect to common shares that are not outstanding but may be
acquired by a person or entity upon exercise of all options exercisable by
such entity or person within sixty days of the date of the date hereof.
However, those common shares are not deemed to be outstanding for the
purpose of computing the percentage of outstanding common shares
beneficially owned by any other person.

Amount and
Nature of
Name and Address of Beneficially Percent
Beneficial Owner Owned of Class
- -------------------- --------------- ----------

Morgens Waterfall Income 3,391,074 21.9%
Partners, L.P. (1)
Restart Partners, L.P.
Restart Partners II, L.P.
Restart Partners III, L.P.
Restart Partners IV, L.P.
Restart Partners V, L.P.
Endowment Restart, L.L.C.
10 East 50th Street
New York, NY 10022

Kensington Investment Group, Inc. (2) 2,471,056 17.3%
Mellon Bank, N.A. as Trustee for
the General Motors Employees
Domestic Group Pension Trust
350 East 21st Street
New York, New York 10010

Magten Asset Management Corp. (3) 743,750 5.2%

Four Orinda Way
Suite 220D
Orinda, CA 94563

Daniel Levinson (4) 1,000 *

Amount and
Nature of
Name and Address of Beneficially Percent
Beneficial Owner Owned of Class
- -------------------- --------------- ----------

Leonard G. Levine, 862,504 6.0%
President (5)

Stephen M. Peck (4) 1,000 *

L.G. Schafran, 1,000 *
Interim President and CEO (4)

Robert G. Higgins, 40,642 *
First Vice President,
General Counsel,
Chief Operating Officer and
Assistant Secretary (4)(5)

Joel J. Teglia, 36,974 *
Chief Financial Officer (4)(5)

Walter E. Auch, Sr. (4) 5,000 *

All Trustees and 948,120 6.6%
Named Executive Officers
of the Trust, as a group
(eight persons)

- --------------------

* less than 1%

(1) Includes the conversion of 61,572 shares of convertible preferred
stock, which can be converted into 1,195,573 of our common shares at a
price of $5.15 per share. Certain affiliates of Morgens Waterfall Income
Partners, L.P. have filed reports with the SEC pursuant to Section 13(d) of
the Securities Exchange Act of 1934, as amended, (the "Exchange Act")
indicating combined ownership of five percent (5%) or more of the
outstanding common shares. As of December 31, 2000, (i) Morgens Waterfall
Income Partners, L.P. owns 83,315 common shares; (ii) Restart Partners,
L.P. owns 418,768 common shares; (iii) Restart Partners II, L.P. owns
692,830 common shares; (iv) Restart Partners III, L.P. owns 482,350 common
shares; (v) Restart Partners IV, L.P. owns 304,758 common shares; (vi)
Restart Partners V, L.P. owns 100,855 common shares; (vii) Endowment
Restart, L.L.C. owns 109,625 common shares. Although John C. Waterfall and
Edwin H. Morgens do not directly own any common shares, each of them may be
deemed an indirect beneficial owner of 2,192,501 common shares by virtue of
their effective control over the operation of each of the affiliated
entities listed above. Furthermore, Morgens Waterfall Capital, L.L.C. may
be deemed an owner of 83,315 common shares by virtue of its position as
general partner of Morgens Waterfall Income Partners, L.P.

(2) According to filings made with the SEC, Kensington Investment Group,
Inc. ("Kensington") is an investment advisor registered under the
Investment Advisors Act of 1940. Kensington has filed reports with the SEC
pursuant to Section 13(d) of the Exchange Act, indicating ownership of five
percent (5%) or more of the outstanding common shares. As of December 31,
2000, Kensington has sole dispositive power over 2,471,056 common shares,
and sole voting power over 2,471,056 common shares.

(3) According to filings made with the SEC, Magten Asset Management Corp.
("Magten") is an investment advisor registered under the Investment
Advisors Act of 1940. Magten has filed reports with the SEC pursuant to
Section 13(d) of the Exchange Act, indicating ownership of five percent
(5%) or more of the outstanding common shares. As of December 31, 2000,
Magten has shared dispositive power over 743,750 common shares, and shared
voting power over 210,150 common shares.

(4) Includes options to purchase 3,335 shares for Mr. Teglia, 5,000
shares for Mr. Auch and 1,000 shares for each of Messrs. Levinson, Peck and
Schafran.

(5) Includes shares purchased on January 12, 2000 pursuant to the
aforementioned employee stock loan program as follows: Mr. Levine, 350,000
shares; Mr. Higgins, 30,335 shares; and Mr. Teglia, 29,000 shares.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

During the first eight months of 2000, we paid no salary to, but
purchased legal services from, Robert G. Higgins, our vice president,
secretary and general counsel. We paid Mr. Higgins, in the aggregate,
$246,405 for these services. We also provided Mr. Higgins with office
space and equipment. Mr. Higgins did not pay any rent for the use of
office space and equipment. Instead, Mr. Higgins billed us at a discounted
rate. Mr. Higgins also reimbursed us for the cost of two full-time and
certain part-time employees. For the first eight months of 2000, Mr.
Higgins reimbursed us for a total of $136,815. On September 1, 2000, Mr.
Higgins became our full time employee, as did the employees whose salaries
were reimbursed to us by Mr. Higgins. During the fiscal year ended
December 31, 2000, we paid Adam Levine, the son of Mr. Levine, $125,916 for
services rendered to us as an employee. We also provided Adam Levine with
benefits customarily provided to our other employees. On October 31, 2000,
we terminated the employment of Adam Levine as part of our Retention and
Severance Program and paid him a severance payment in accordance with that
program equal to $90,762.

On January 12, 2000, our employees exercised their vested options to
purchase 575,337 of our common shares with the proceeds of loans from us.
See "Compensation of Trustees and Executive Officers" above for details of
the loan program. The table below shows the original amounts outstanding
and the loan balances on December 31, 2000 due from our executive officers
and Adam Levine.

Original Balance at
Name Amount December 31, 2000
- ---- ---------- -----------------

Leonard G. Levine $1,925,000 $1,864,921
Jay E. Schmidt $ 213,500 $ 208,223
Neil D. Hansen $ 213,500 $ 208,223
Joel L. Teglia $ 170,875 $ 166,560
Robert G. Higgins $ 173,735 $ 168,930
Adam Levine $ 95,493 $ 92,691

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a) (1) Financial Statements of the Company are set forth
in this report in Item 8.

(2) Financial Statement Schedule is set forth in this
report in Item 8.

(b) Reports on Form 8-K:

. dated August 17, 2000, filed October 25, 2000 including
Item 7; and

. dated and filed October 25, 2000 including Item 7; and

. dated and filed November 9, 2000 including Item 9.

(d) None.

SIGNATURES

PURSUANT to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be
signed on its behalf by the undersigned, thereunto duly authorized.

BANYAN STRATEGIC REALTY TRUST

By: /s/ L.G. Schafran Date: March 9, 2001
L.G. Schafran, Interim President

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

By: /s/ L.G. Schafran Date: March 9, 2001
L.G. Schafran, Interim President
and Trustee

By: /s/ Joel L. Teglia Date: March 9, 2001
Joel L. Teglia, Executive Vice President
and Chief Financial Officer

By: /s/ Walter E. Auch, Sr. Date: March 9, 2001
Walter E. Auch, Sr., Trustee

By: /s/ Daniel Levinson Date: March 9, 2001
Daniel Levinson, Trustee

By: /s/ Stephen M. Peck Date: March 9, 2001
Stephen M. Peck, Trustee

EXHIBIT
INDEX
- -------

2.1 Plan of Termination and Liquidation (1)

3.1 Third Amended and Restated Declaration of Trust dated as of
August 8, 1986, as amended on March 8, 1991, May 1, 1993, August 12, 1998
and December 13, 1999, including Certificate of designations, preferences
and rights of Series A convertible preferred shares. (2)

3.2 First Amendment of Third Amended and Restated Declaration of
Trust effective December 13, 1999. (3)

3.3 By-Laws dated March 13, 1996. (4)

3.4 BSRT UPREIT Limited Partnership Limited Partnership Agreement (5)

4.1 Convertible Term Loan Agreement dated as of October 10, 1997
among Banyan Strategic Realty Trust, as Borrower, and the Entities listed
therein, as Lenders. (6)

4.2 First Amendment to Convertible Term Loan Agreement dated as of
March 30, 1998 made by and among Banyan Strategic Realty Trust and the
Entities listed therein, as Lenders. (7)

4.3 Second Amendment to Convertible Term Loan Agreement dated as of
June 26, 1998 made by and among Banyan Strategic Realty Trust and the
Entities listed therein, as Lenders. (8)

4.4 Revolving Credit Agreement dated April 30, 1998 among Banyan
Strategic Realty Trust, as Borrower and the Capital Company of America, as
Lender. (9)

4.5 Loan Agreement dated May 22, 1998 among BSRT Fountain Square
L.L.C., BSRT Phoenix Business Park L.L.C., BSRT Newtown Trust, BSRT
Southlake L.L.C., BSRT Technology Center L.L.C., BSRT Airways Plaza L.L.C.,
BSRT Peachtree Pointe L.L.C., BSRT Avalon Center L.L.C., BSRT Sand Lake
Tech Center L.L.C., BSRT Park Center L.L.C., BSRT Metric Plaza L.L.C., and
BSRT University Corporate Center L.L.C., as Borrower, and the Capital
Company of America, as Lender. (8)

4.6 First Amendment to Loan Agreement dated September 11, 1998 among
BSRT Fountain Square L.L.C., BSRT Phoenix Business Park L.L.C., BSRT Newton
Trust, BSRT Southlake L.L.C., BSRT Technology Center L.L.C., BSRT Airways
Plaza L.L.C., BSRT Peachtree Pointe L.L.C., BSRT Avalon Center L.L.C., BSRT
Sand Lake Tech Center L.L.C., BSRT Park Center L.L.C., BSRT Metric Plaza
L.L.C., and BSRT University Corporate Center L.L.C., as Borrower, and the
Capital Company of America LLC, as Lender. (10)

4.7 Loan Agreement dated June 22, 1998 between Banyan/Morgan
Wisconsin L.L.C., and Banyan/Morgan Elmhurst L.L.C., as Borrower and the
Capital Company of America, as Lender. (8)

4.8 First Amendment to Loan Agreement dated September 11, 1998
between Banyan/Morgan Wisconsin L.L.C., and Banyan/Morgan Elmhurst L.L.C.,
as Borrower and the Capital Company of America LLC, as Lender. (10)

10.1 Employment Agreement of L.G. Schafran dated October 26, 2000.
(14)

10.2 Employment Agreement of Leonard G. Levine as of December 14,
1999. (2)

EXHIBIT
INDEX
- -------

10.3 Employment Agreement of Leonard G. Levine as of October 1, 1997.
(11)

10.4 Employment Agreement of Joel L. Teglia dated November 1, 2000.
(14)

10.5 Employment Agreement of Joel L. Teglia dated December 31, 1998.
(5)

10.6 Employment Agreement of Robert G. Higgins dated September 1,
2000. (14)

10.7 Separation Agreement of Neil Hansen dated October 1, 2000. (14)

10.8 Employment Agreement of Neil Hansen dated December 31, 1998. (5)

10.9 Separation Agreement of Jay Schmidt dated October 1, 2000. (14)

10.10 Employment Agreement of Jay Schmidt dated December 31, 1998. (5)

10.11 1997 Omnibus Stock and Incentive Plan dated July 9, 1997. (12)

10.12 Share Purchase Agreement by and among Banyan Strategic Realty
Trust and the Purchasers listed on the signature page attached thereto
dated as of October 10, 1997. (6)

10.13 Registration Rights Agreement dated as of October 10, 1997
between Banyan Strategic Realty Trust and the Purchasers listed on the
Signature Pages attached thereto. (6)

10.14 Registration Rights Agreement dated as of October 1, 1997 between
Banyan Strategic Realty Trust and Leonard G. Levine. (5)

10.15 Consulting Agreement dated as of February 18, 2000 between CFC
Advisory Services Limited Partnership and Banyan Strategic Realty Trust.
(13)

10.16 Modification to Consulting Agreement dated as of May 31, 2000
between CFC Advisory Services Limited Partnership and Banyan Strategic
Realty Trust. (13)

10.17 Purchase and Sale Agreement dated January 8, 2001. (1)

21. Subsidiaries of Banyan Strategic Realty Trust (*)

23. Consent of Independent Auditors (*)

- --------------------

(*) Filed herewith.

(1) Incorporated by reference from the Trust's Form 8-K dated
January 8, 2001.

(2) Incorporated by reference from the Trust's Form 10-K for
the year ended December 31, 1999.

(3) Incorporated by reference from the Trust's Form 10-Q
dated March 31, 2000.

(4) Incorporated by reference from the Trust's Registration
Statement on Form S-11 (file number 33-4169).

(5) Incorporated by reference from the Trust's Form 10-K for
the year ended December 31, 1998.

(6) Incorporated by reference from the Trust's Form 8-K dated
October 14, 1997.

(7) Incorporated by reference from the Trust's Form 10-K/A
for the year ended December 31, 1997.

(8) Incorporated by reference from the Trust's Form 8-K dated
May 22, 1998.

(9) Incorporated by reference from the Trust's Form 10-Q
dated March 31, 1998.

(10) Incorporated by reference from the Trust's Form 8-K/A-1
dated August 14, 1998.

(11) Incorporated by reference from the Trust's Form 10-K
dated December 31, 1997.

(12) Incorporated by reference from the Trust's Form 10-Q for
the quarter ended June 30, 1997.

(13) Incorporated by reference from the Trust's Form 10-Q for
the quarter ended June 30, 2000.

(14) Incorporated by reference from the Trust's Form 10-Q for
the quarter ended September 30, 2000.