UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2004
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Transition period from _________________ to ________________
Commission File Number 1-12386
LEXINGTON CORPORATE PROPERTIES TRUST
------------------------------------------------
(Exact name of registrant as specified in its charter)
Maryland 13-3717318
------------------------------ ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Penn Plaza - Suite 4015
New York, NY 10119
-------------------------------------- -----------
(Address of principal executive offices) (Zip code)
(212) 692-7200
--------------------------------------------------
(Registrant's telephone number, including area code)
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 whether the registrant is an accelerated filer (as
defined by Rule 12b-2 of the Act).
Yes [X]. No [ ].
Indicate the number of shares outstanding of each of the registrant's classes of
common shares, as of the latest practicable date: 48,138,522 common shares, par
value $.0001 per share on May 6, 2004.
PART 1. - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
LEXINGTON CORPORATE PROPERTIES TRUST AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
March 31, 2004 (Unaudited) and December 31, 2003
(in thousands, except share and per share data)
March 31, December 31,
2004 2003
------------ ------------
ASSETS:
Real estate, at cost $ 1,274,907 $ 1,162,395
Less: accumulated depreciation and amortization 157,996 160,623
------------ ------------
1,116,911 1,001,772
Properties held for sale - discontinued operations 79,662 36,478
Cash and cash equivalents 87,694 15,923
Investment in joint ventures 86,800 69,225
Deferred expenses, net 10,637 10,013
Rent receivable - deferred 24,324 24,069
Intangible assets, net 24,737 14,736
Other assets, net 32,670 35,195
------------ ------------
$ 1,463,435 $ 1,207,411
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY:
Mortgages and notes payable $ 639,080 $ 455,940
Credit facility borrowings - 94,000
Mortgage notes payable - discontinued operations 22,597 1,445
Accrued interest payable 2,830 1,576
Prepaid rent 3,696 2,482
Origination fees payable, including accrued interest 799 808
Accounts payable and other liabilities 7,712 8,283
------------ ------------
676,714 564,534
Minority interests 58,124 59,220
------------ ------------
734,838 623,754
------------ ------------
Commitments and contingencies (note 9)
Common shares, par value $0.0001 per share, 287,888 shares issued and
outstanding, liquidation preference $3,886 3,809 3,809
------------ ------------
Shareholders' equity:
Preferred shares, par value $0.0001 per share; authorized 10,000,000 shares,
Series B Cumulative Redeemable Preferred, liquidation preference
$79,000, 3,160,000 shares issued and outstanding 76,315 76,315
Common shares, par value $0.0001 per share; authorized 80,000,000 shares,
47,815,003, and 40,394,113 shares issued and outstanding in 2004 and
2003, respectively 5 4
Additional paid-in-capital 754,201 601,501
Deferred compensation, net (10,051) (6,265)
Accumulated distributions in excess of net income (95,682) (91,707)
------------ ------------
724,788 579,848
------------ ------------
$ 1,463,435 $ 1,207,411
============ ============
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
2
LEXINGTON CORPORATE PROPERTIES TRUST AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Three months ended March 31, 2004 and 2003
(Unaudited and in thousands, except share and per share data)
Three months ended
March 31,
2004 2003
------------ ------------
Revenues:
Rental $ 30,276 $ 24,933
Advisory fees 950 325
Tenant reimbursements 892 479
------------ ------------
32,118 25,737
Depreciation and amortization (7,535) (5,957)
Property operating (1,875) (1,310)
General and administrative (3,503) (2,299)
Interest and other income 68 226
Interest expense (8,653) (8,838)
Amortization of deferred costs (354) (412)
------------ ------------
10,266 7,147
Provision for income taxes (766) -
Minority interests (1,080) (1,073)
Equity in earnings of joint ventures 1,804 1,349
------------ ------------
Income from continuing operations 10,224 7,423
------------ ------------
Discontinued operations, net of minority interests:
Income from discontinued operations 1,749 881
Impairment charge (1,732) -
Gains on sales of properties 1,737 459
------------ ------------
Total discontinued operations 1,754 1,340
------------ ------------
Net income 11,978 8,763
Dividends attributable to preferred shares - Series B (1,590) -
------------ ------------
Net income allocable to common shareholders $ 10,388 $ 8,763
============ ============
Income per common share-basic:
Income from continuing operations $ 0.20 $ 0.25
Income from discontinued operations 0.04 0.04
------------ ------------
Net income $ 0.24 $ 0.29
============ ============
Weighted average common shares outstanding - basic 42,474,808 29,983,496
============ ============
Income per common share-diluted:
Income from continuing operations $ 0.20 $ 0.24
Income from discontinued operations 0.04 0.05
------------ ------------
Net income $ 0.24 $ 0.29
============ ============
Weighted average common shares outstanding - diluted 48,046,513 35,393,714
============ ============
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
3
LEXINGTON CORPORATE PROPERTIES TRUST AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three months ended March 31, 2004 and 2003
(Unaudited and in thousands)
2004 2003
-------- --------
Net cash provided by operating activities $ 23,568 $ 13,184
-------- --------
Cash flows from investing activities:
Acquisition of properties (53,450) (24,223)
Net proceeds from sale/transfer of properties 34,429 2,151
Real estate deposits, net (7,284) (422)
Investment in and advances to joint ventures, net (17,200) (6,875)
Distribution of loan proceeds from joint ventures 10,685 -
Decrease (increase) in leasing costs 266 (119)
-------- --------
Net cash used in investing activities (32,554) (29,488)
-------- --------
Cash flows from financing activities:
Dividends to common and preferred shareholders (15,952) (10,214)
Dividend reinvestment plan proceeds 2,820 1,452
Change in credit facility borrowings, net (94,000) (8,500)
Principal amortization payments (4,536) (3,196)
Proceeds of mortgages and notes payable 52,015 40,655
Increase in deferred costs, net (1,818) (340)
Cash distributions to minority partners (1,676) (1,917)
Proceeds from the sale of common shares, net 144,688 250
Increase in escrow deposits (762) (1,456)
Origination fee amortization payments (22) (107)
-------- --------
Net cash provided by financing activities 80,757 16,627
-------- --------
Cash attributable to newly consolidated entity - 1,578
-------- --------
Change in cash and cash equivalents 71,771 1,901
Cash and cash equivalents, at beginning of period 15,923 12,097
-------- --------
Cash and cash equivalents, at end of period $ 87,694 $ 13,998
======== ========
The accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
4
LEXINGTON CORPORATE PROPERTIES TRUST AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2004
(Unaudited and dollars in thousands, except per share data)
(1) The Company
Lexington Corporate Properties Trust (the "Company") is a self-managed and
self-administered real estate investment trust ("REIT") that acquires,
owns and manages a geographically diversified portfolio of net leased
office, industrial and retail properties. As of March 31, 2004, the
Company had an ownership interest in 127 properties and managed an
additional 2 properties. The real properties owned by the Company are
generally subject to triple net leases to corporate tenants. Of the
Company's 127 properties, six provide for operating expense stops and one
is a modified gross lease.
The Company believes it has qualified as a REIT under the Internal Revenue
Code of 1986, as amended (the "Code"). Accordingly, the Company will not
be subject to federal income tax, provided that distributions to its
shareholders equal at least the amount of its REIT taxable income as
defined under the Code. The Company is permitted to participate in certain
activities which it was previously precluded from in order to maintain its
qualification as a REIT, so long as these activities are conducted in
entities which elect to be treated as taxable REIT subsidiaries ("TRS")
under the Code. As such, the Company will be subject to federal income
taxes on the income from these activities.
The unaudited financial statements reflect all adjustments, which are, in
the opinion of management, necessary to present a fair statement of the
financial condition and results of operations for the interim periods. For
a more complete understanding of the Company's operations and financial
position, reference is made to the financial statements (including the
notes thereto) previously filed with the Securities and Exchange
Commission with the Company's Annual Report on Form 10-K, for the year
ended December 31, 2003.
(2) Summary of Significant Accounting Policies
Basis of Presentation and Consolidation. The Company's consolidated
financial statements are prepared on the accrual basis of accounting. The
financial statements reflect the accounts of the Company and its
controlled subsidiaries, including Lepercq Corporate Income Fund L.P.
("LCIF"), Lepercq Corporate Income Fund II L.P. ("LCIF II"), Net 3
Acquisition L.P. ("Net 3"), Lexington Realty Advisors, Inc. ("LRA"), and
Lexington Contributions, Inc. ("LCI"). LRA and LCI are wholly owned
taxable REIT subsidiaries and the Company is the sole unitholder of each
of the general partner and the majority limited partner of LCIF, LCIF II
and Net 3.
Earnings Per Share. Basic net income per share is computed by dividing net
income reduced by preferred dividends, if applicable, by the weighted
average number of common shares outstanding during the period. Diluted net
income per share amounts are similarly computed but include the effect,
when dilutive, of in-the-money common share options and operating
partnership units.
Recently Issued Accounting Standards. In December 2003, the FASB issued
FASB Interpretation No. 46 (revised December 2003), Consolidation of
Variable Interest Entities ("VIEs"), which addresses how a business
enterprise should evaluate whether it has a controlling financial interest
in an entity through means other than voting rights and accordingly should
consolidate the entity. FIN 46R replaces FASB Interpretation No. 46,
Consolidation of Variable Interest Entities, which was issued in January
2003. The Company has adopted FIN 46R during the three months ended March
31, 2004. The adoption of FIN 46R had no impact on the Company's condensed
consolidated financial statements.
SFAS No. 148, "Accounting for Stock-Based Compensation - Transition and
Disclosure, an amendment of FASB Statement No. 123" requires the Company
to disclose in both annual and interim financial statements the method of
accounting for stock-based employee compensation and the effect of the
method used on reported results. The Company has elected to continue to
account for its option plan under the recognition provision of Accounting
Principles Board Opinion No. 25 "Accounting for Stock Issued to
Employees." Accordingly, no compensation cost has been recognized with
regard to options granted in the condensed consolidated statements of
income.
5
Common share options granted generally vest ratably over a four-year term
and expire five years from the date of grant. The following table
illustrates the effect on net income and earnings per share if the fair
value based method had been applied to all outstanding share option awards
in each period:
Three Months Ended March 31,
2004 2003
------------ ------------
Net income allocable to common shareholders,
as reported $ 10,388 $ 8,763
Add: Stock based employee compensation
expense included in reported net income - -
Deduct: Total stock based employee
compensation expense determined under fair
value based method for all awards 64 127
------------ ------------
Pro forma net income - basic $ 10,324 $ 8,636
============ ============
Net income per share - basic
Basic - as reported $ 0.24 $ 0.29
============ ============
Basic - pro forma $ 0.24 $ 0.29
============ ============
Net income allocable to common shareholders
for diluted earnings per share $ 11,418 $ 10,109
Add: Stock based employee compensation
expense included in reported net income - -
Deduct: Total stock based employee
compensation expense determined under fair
value based method for all awards 64 127
------------ ------------
Pro forma net income - diluted $ 11,354 $ 9,982
============ ============
Net income per share - diluted
Diluted - as reported $ 0.24 $ 0.29
============ ============
Diluted - pro forma $ 0.24 $ 0.28
============ ============
6
Use of Estimates. Management has made a number of estimates and
assumptions relating to the reporting of assets and liabilities, the
disclosure of contingent assets and liabilities and the reported amounts
of revenues and expenses to prepare these condensed consolidated financial
statements in conformity with generally accepted accounting principles.
The most significant estimates made include the recoverability of accounts
receivable (primarily related to straight-line rents) and the useful lives
of assets. Actual results could differ from those estimates.
Purchase Accounting for Acquisition of Real Estate. The fair value of the
real estate acquired, which includes the impact of mark to market
adjustments for assumed mortgage debt relating to property acquisitions,
is allocated to the acquired tangible assets, consisting of land, building
and tenant improvements, and identified intangible assets and liabilities,
consisting of the value of above-market and below-market leases, other
value of in-place leases and value of tenant relationships, based in each
case on their fair values.
The fair value of the tangible assets of an acquired property (which
includes land, building and tenant improvements) is determined by valuing
the property as if it were vacant, and the "as-if-vacant" value is then
allocated to land, building and tenant improvements based on management's
determination of relative fair values of these assets. Factors considered
by management in performing these analyses include an estimate of carrying
costs during the expected lease-up periods considering current market
conditions and costs to execute similar leases. In estimating carrying
costs, management includes real estate taxes, insurance and other
operating expenses and estimates of lost rental revenue during the
expected lease-up periods based on current market demand. Management also
estimates costs to execute similar leases including leasing commissions.
In allocating the fair value of the identified intangible assets and
liabilities of an acquired property, above-market and below-market
in-place lease values are recorded based on the difference between the
current in-place lease rent and a management estimate of current market
rents.
The aggregate value of other acquired intangible assets, consisting of
in-place leases and tenant relationships, is measured by the excess of (i)
the purchase price paid for a property over (ii) the estimated fair value
of the property as if vacant, determined as set forth above. This
aggregate value is allocated between in-place lease values and tenant
relationships based on management's evaluation of the specific
characteristics of each tenant's lease. The value of in-place leases and
customer relationships are amortized to expense over the remaining
non-cancelable periods of the respective leases.
Properties Held for Sale. The Company accounts for properties held for
sale in accordance with Statement of Financial Accounting Standards No.
144 "Accounting for the Impairment or Disposal of Long-Lived Assets" (SFAS
No. 144). SFAS No. 144 requires that the assets and liabilities of
properties that meet various criteria in SFAS No. 144 be presented
separately in the statement of financial position, with assets and
liabilities being separately stated. The operating results of these
properties are reflected as discontinued operations in the income
statement. Properties that do not meet the held for sale criteria of SFAS
No. 144 are accounted for as operating properties.
Revenue Recognition. The Company recognizes revenue in accordance with
Statement of Financial Accounting Standards No. 13 "Accounting for Leases"
(SFAS No.13). SFAS No.13 requires that revenue be recognized on a straight
line basis over the term of the lease unless another systematic and
rational basis is more representative of the time pattern in which the use
benefit is derived from the leased property.
Gains on sales of real estate are recognized pursuant to the provisions of
SFAS No. 66 "Accounting for Sales of Real Estate"(SFAS No. 66). The
specific timing of the sale is measured against various criteria in SFAS
No. 66 related to the terms of the transactions and any continuing
involvement in the form of management or financial assistance associated
with the properties. If the sales criteria are not met, the gain is
deferred and the finance, installment or cost recovery method, as
appropriate, is applied until the sales criteria are met.
Accounts Receivable. The Company continuously monitors collections from
its tenants and would make a provision for estimated losses based upon
historical experience and any specific tenant collection issues that the
Company has identified. As of March 31, 2004 and December 31, 2003, the
Company did not record an allowance for doubtful accounts.
Real Estate. The Company evaluates the carrying value of all real estate
held to determine if an impairment has occurred which would require the
recognition of a loss. The evaluation includes reviewing anticipated cash
flows of the property,
7
based on current leases in place, coupled with an estimate of proceeds to
be realized upon sale. However, estimating future sale proceeds is highly
subjective and such estimates could differ materially from actual results.
Income Taxes. Income taxes for the TRS are accounted for under the asset
and liability method. Deferred tax assets and liabilities are recognized
for the estimated future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases and operating loss and tax
credit carry-forwards. Deferred tax assets and liabilities are measured
using estimated tax rates in effect for the year in which the temporary
differences are expected to be recovered or settled.
Reclassification. Certain amounts included in 2003 financial statements
have been reclassified to conform with the 2004 presentation.
8
(3) Earnings per Share
The following is a reconciliation of the numerators and denominators of
the basic and diluted earnings per share computations for the three months
ended March 31, 2004 and 2003:
Three months ended
March 31,
2004 2003
------------ ------------
BASIC
Income from continuing operations $ 10,224 $ 7,423
Less preferred dividends (1,590) -
------------ ------------
Income allocable to common shareholders from
continuing operations 8,634 7,423
Total income from discontinued operations 1,754 1,340
------------ ------------
Net income allocable to common shareholders $ 10,388 $ 8,763
============ ============
Weighted average number of common shares
outstanding 42,474,808 29,983,496
============ ============
Income per common share - basic:
Income from continuing operations $ 0.20 $ 0.25
Income from discontinued operations 0.04 0.04
------------ ------------
Net income $ 0.24 $ 0.29
============ ============
DILUTED
Income allocable to common shareholders from
continuing operations -basic $ 8,634 $ 7,423
Incremental income attributed to assumed
conversion of dilutive securities 1,080 1,073
------------ ------------
Income allocable to common shareholders from
continuing operations - diluted 9,714 8,496
Total income from discontinued operations - diluted 1,704 1,613
------------ ------------
Net income allocable to common shareholders -
diluted $ 11,418 $ 10,109
============ ============
Weighted average number of common shares used in
calculation of basic earnings per share 42,474,808 29,983,496
Add incremental shares representing:
Shares issuable upon exercise of employee share
options 179,080 160,503
Shares issuable upon conversion of dilutive
securities 5,392,625 5,249,715
------------ ------------
Weighted average number of shares used in
calculation of diluted earnings per common
share 48,046,513 35,393,714
============ ============
Income per common share - diluted:
Income from continuing operations $ 0.20 $ 0.24
Income from discontinued operations 0.04 0.05
------------ ------------
Net income $ 0.24 $ 0.29
============ ============
9
(4) Investments in Real Estate
The following acquisitions were consummated during 2004:
- The Company acquired a property in Wall, New Jersey net leased
to New Jersey Natural Gas Co. for an aggregate capitalized
cost of $37,563. The lease, which expires in June 2021,
provides for average annual rent of $3,323. The purchase price
was partially funded through the assumption of a non-recourse
mortgage note valued at $30,036 which bears imputed interest
at 6.25%, provides for annual debt service of $2,013 and fully
amortizes by maturity in January 2021. The assumed mortgage
had a face amount of $27,500 and a stated interest rate of
7.32%.
- The Company purchased a property in Moody, Alabama for $11,559
net leased to TNT Logistics North America, Inc. through
January 2014. The lease provides for average annual rent of
$1,054. The purchase price was partially funded through a
$7,675, non-recourse mortgage which bears interest at 4.98%,
provides for annual debt service of $493 and matures January
2014 when a balloon payment of $6,350 is due.
- The Company purchased a property in Redmond, Oregon for
$16,485 net leased to T-Mobile USA, Inc. through January 2019.
The lease provides for average annual rent of $1,552. The
purchase price was partially funded through a $10,100,
non-recourse mortgage which bears interest at 5.62%, provides
for annual debt service of $697 and matures April 2014 when a
balloon payment of $8,484 is due.
- The Company purchased a property in Mission, Texas for $10,168
net leased to T-Mobile USA, Inc. through June 2015. The lease
provides for average annual rent of $979. The purchase price
was partially funded through a $6,570, non-recourse mortgage
which bears interest at 5.78%, provides for annual debt
service of $462 and matures June 2015 when a balloon payment
of $5,371 is due.
- The Company purchased a property in Centennial, Colorado for
$24,977 net leased to The Shaw Group, Inc., through May 2013.
The lease provides for average annual rent of $2,418. The
purchase price was partially funded through the assumption of
a $15,891, non-recourse mortgage which bears interest at
6.15%, provides for annual debt service of $1,177 and matures
February 2013 when a balloon payment of $13,555 is due.
- The Company purchased four properties in the Houston, Texas
area for an aggregated capitalized cost of $131,231 net leased
to Baker Hughes, Inc., through September 2015. The leases
provide for average annual rents of $13,230. The purchase
price was partially funded through four assumed non-cross
collaterized, non-recourse mortgage notes valued at $123,642
with imputed interest rates of 6.25%, providing for current
aggregate annual debt service of $10,866 and maturing
September 2015 when an aggregate balloon payment of $33,811 is
due. The assumed mortgages had an aggregate face amount of
$110,696 and a stated interest rate of 8.04%.
The Company has allocated $12,660 of the purchase price of these
properties to intangible assets.
The following pro forma operating information for the three months ended
March 31, 2004 and 2003 has been prepared as if all Company acquisitions
and dispositions (including non-consolidated entities) in 2004 and 2003
had been consummated as of January 1, 2003. The information does not
purport to be indicative of what the operating results of the Company
would have been had the acquisitions and dispositions been consummated on
January 1, 2003. Pro forma amounts are as follows:
March 31,
2004 2003
---------- ----------
Rental revenues $ 34,067 $ 34,191
Net income $ 11,125 $ 11,432
Net income per common share
Basic $ 0.22 $ 0.38
Diluted $ 0.22 $ 0.36
10
(5) Discontinued Operations
During the three months ended March 31, 2004, the Company sold one
property in Riverdale, Georgia and one property in DeWitt, New York, for
aggregate net proceeds of $6,261, which resulted in an aggregate gain of
$1,737. As of March 31, 2004, the Company had six properties held for sale
and recorded an impairment charge of $1,732 relating to the difference
between the basis for one property and the estimated net proceeds expected
to be realized upon sale.
The following presents the operating results for the properties sold and
properties held for sale for the applicable periods:
Three Months Ended March 31,
2004 2003
------------ ------------
Rental revenues $ 2,747 $ 2,117
Pre-tax income,
including gains on sale $ 1,861 $ 1,340
(6) Investment in Joint Ventures
The Company has six joint ventures. The entities are Lexington Acquiport
Company, LLC (33 1/3% ownership), Lexington Acquiport Company II, LLC (25%
ownership), Lexington/Lion Venture LP (30% ownership interest), Lexington
Florence LLC (22.7% ownership interest), Lexington Columbia LLC (40%
ownership interest) and Lexington Durham Limited Partnership (33 1/3%
ownership interest).
During 2004, Lexington/Lion Venture LP ("LION") purchased a property in
New Lenox, Illinois net leased to Michaels Stores Procurement Company for
$28,651. The lease, which expires January 2024, provides for annual net
rent of $1,892. The purchase price was partially funded through an
interest only $17,400 non-recourse mortgage which bears interest at 5.51%,
provides for annual debt service of $972 and matures February 2014 when a
balloon payment of $17,400 is due.
In addition, the Company contributed a property to LION for $20,519
(subject to a current $12,718 non-recourse mortgage) net leased to Tower
Automotive, Inc. This contribution was valued at the Company's carrying
cost for the assets and liabilities.
During 2004, the Company contributed a property to Lexington Acquiport
Company II, LLC ("LAC II") for $30,286 net leased to Seimens Dematic
Postal Automation, LP. This contribution was valued at the Company's
carrying cost for the assets and liabilities. LAC II subsequent obtained a
$22,000 non-recourse mortgage for the property which bears interest at
5.81%, provides for annual debt service of $1,551 and requires a balloon
payment of $18,605 at maturity in February 2014.
The following is summary combined balance sheet and income statement data
as of March 31, 2004 and the three months ended March 31, 2004 and 2003
for the Company's joint venture investments:
2004
----------
Real estate, net $ 582,682
Mortgages payable $ 351,440
2004 2003
---------- ----------
Revenues $ 17,460 $ 11,866
Expenses 12,253 8,062
---------- ----------
Net income $ 5,207 $ 3,804
========== ==========
(7) Concentration of Risk
The Company seeks to reduce its operating and leasing risks through
diversification achieved by the geographic distribution of its properties,
tenant industry diversification, avoiding dependency on a single property
and the creditworthiness of its tenants. For the three months ended March
31, 2004 and 2003, no single tenant represented greater than 10% of
revenues.
11
Cash and cash equivalent balances may exceed insurable amounts. The
Company believes it mitigates risk by investing in or through major
financial institutions.
(8) Minority Interests
In conjunction with several of the Company's acquisitions, sellers were
given interests in LCIF, LCIF II, or Net 3 as a form of consideration. All
of such interests are redeemable at certain times, only at the option of
the holders, for common shares on a one-for-one basis at various dates
through November 2006 and are not otherwise mandatorily redeemable by the
Company.
As of March 31, 2004 there were 5,385,747 units outstanding. All units
have stated distributions in accordance with the respective partnership
agreements. To the extent that the Company's dividend per share is less
than the stated distribution per unit per the partnership agreement, the
distributions per unit are reduced by the percentage reduction in the
Company's dividend. No units have a liquidation preference.
(9) Commitments and Contingencies
The Company is obligated under certain tenant leases, including leases for
joint venture properties, to fund the expansion of the underlying leased
properties.
The Company is involved in various legal actions occurring in the ordinary
course of business. In the opinion of management, the ultimate disposition
of these matters will not have a material adverse effect on the Company's
consolidated financial position, results of operations or liquidity.
The Company has entered into binding letters of intent to purchase two
properties upon completion of construction and commencement of rent from
the tenants. The aggregate estimated obligation is $29,444.
(10) Shareholders' Equity
During the three months ended March 31, 2004, the Company issued 6,900,000
common shares at $20.92 per share raising net proceeds of $144,206.
(11) Supplemental Disclosure of Statement of Cash Flow Information
During 2004 and 2003, the Company paid $7,851 and $10,108, respectively,
for interest.
During 2004 and 2003, the Company issued 201,029 and 336,992 common
shares, respectively, to certain employees and trustees resulting in
$4,059 and $5,391 of deferred compensation, respectively. These common
shares generally vest over 5 years. However, in certain situations the
vesting only occurs if certain performance criteria are met.
During 2004 and 2003, holders of an aggregate of 44,707 and 9,059
partnership units redeemed such units for common shares of the Company.
These redemptions resulted in an increase in shareholders' equity and
corresponding decrease in minority interest of $509 and $124,
respectively.
During 2003, three officers repaid recourse notes due the Company,
including accrued interest thereon, of $2,522 by delivering to the Company
156,189 common shares.
See footnotes 4 and 6 for additional non-cash disclosures.
12
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Forward-Looking Statements
When used in this Form 10-Q Report, the words "believes," "expects," "estimates"
and similar expressions are generally intended to identify forward-looking
statements. Such statements are subject to certain risks and uncertainties which
could cause actual results to differ materially. In particular, among the
factors that could cause actual results to differ materially are the failure to
continue to qualify as a real estate investment trust, changes in general
business and economic conditions, competition, increases in real estate
construction costs, changes in interest rates, changes in accessibility of debt
and equity capital markets and other risks inherent in the real estate business
including tenant defaults, potential liability relating to environmental matters
and illiquidity of real estate investments. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date hereof. The Company undertakes no obligation to publicly release the
results of any revisions to these forward-looking statements which may be made
to reflect events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.
General
The Company, which has elected to qualify as a real estate investment trust
("REIT") under the Internal Revenue Code of 1986, as amended, acquires, owns and
manages net-leased commercial properties. The Company believes that it has
operated as a REIT since October 1993.
As of March 31, 2004, the Company owned, or had interests in, 127 real estate
properties and managed 2 additional properties.
Critical Accounting Policies
The Company's accompanying condensed consolidated financial statements have been
prepared in conformity with accounting principles generally accepted in the
United States of America, which require management to make estimates that affect
the amounts of revenues, expenses, assets and liabilities reported. The
following are critical accounting policies which are both very important to the
portrayal of the Company's financial condition and results of operations and
which require some of management's most difficult, subjective and complex
judgments. The accounting for these matters involves the making of estimates
based on current facts, circumstances and assumptions which could change in a
manner that would materially affect management's future estimate with respect to
such matters. Accordingly, future reported financial conditions and results
could differ materially from financial conditions and results reported based on
management's current estimates.
Revenue Recognition. The Company recognizes revenue in accordance with Statement
of Financial Accounting Standards No. 13 "Accounting for Leases" (SFAS No.13).
SFAS No.13 requires that revenue be recognized on a straight line basis over the
term of the lease unless another systematic and rational basis is more
representative of the time pattern in which the use benefit is derived from the
leased property.
Gains on sales of real estate are recognized pursuant to the provisions of
Statement of Financial Accounting Standards No. 66 "Accounting for Sales of
Real Estate" (SFAS No. 66). The specific timing of the sale is measured against
various criteria in SFAS No. 66 related to the terms of the transactions and any
continuing involvement in the form of management or financial assistance
associated with the properties. If the sales criteria are not met, the gain is
deferred and the finance, installment or cost recovery method, as appropriate,
is applied until the sales criteria are met.
Accounts Receivable. The Company continuously monitors collections from its
tenants and would make a provision for estimated losses based upon historical
experience and any specific tenant collection issues that the Company has
identified.
Real Estate. The Company evaluates the carrying value of all real estate held to
determine if an impairment has occurred which would require the recognition of a
loss. The evaluation includes reviewing anticipated cash flows of the property,
based on current leases in place, coupled with an estimate of proceeds to be
realized upon sale. However, estimating future sale proceeds is highly
subjective and such estimates could differ materially from actual results.
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Liquidity and Capital Resources
Real Estate Assets. As of March 31, 2004, the Company's real estate assets were
located in 34 states and contained an aggregate of approximately 25.8 million
square feet of net rentable space. The properties are generally subject to
triple net leases, which are generally characterized as leases in which the
tenant pays all or substantially all of the cost and cost increases for real
estate taxes, capital expenditures, insurance, utilities and ordinary
maintenance of the property. Of the Company's 127 properties, six provide for
operating expense stops and one is subject to a modified gross lease.
Approximately 98.9% of square feet is subject to a lease.
During the three months ended March 31, 2004, the Company purchased ten
properties (including one purchased by a joint venture) for a capitalized cost
of $260.6 million and sold two properties, for net cash proceeds of $6.3
million.
The Company's principal sources of liquidity are revenues generated from the
properties, interest on cash balances, amounts available under its unsecured
credit facility and amounts that may be raised through the sale of securities in
private or public offerings. For the three months ended March 31, 2004, the
leases on the consolidated properties generated $33.0 million in rental revenue,
including discontinued operations, compared to $27.0 million during the same
period in 2003.
Common Share Offering. During the three months ended March 31, 2004, the Company
completed a 6.9 million common share offering at $20.92 per share raising net
proceeds of $144.2 million.
Dividends. The Company has made quarterly distributions since October 1986
without interruption. The Company declared a common dividend of $0.35 per share
to common shareholders of record as of April 30, 2004, payable on May 14, 2004.
The Company's annualized common dividend rate is currently $1.40 per share. The
Company also declared a preferred dividend of $0.503125 per share to preferred
shareholders of record as of April 30, 2004, payable on May 17, 2004. The annual
preferred dividend rate is $2.0125 per share.
In connection with its intention to continue to qualify as a REIT for Federal
income tax purposes, the Company expects to continue paying regular common and
preferred dividends to its shareholders. These dividends are expected to be paid
from operating cash flows which are expected to increase over time due to
property acquisitions and growth in rental revenues in the existing portfolio
and from other sources. Since cash used to pay dividends reduces amounts
available for capital investments, the Company generally intends to maintain a
conservative dividend payout ratio, reserving such amounts as it considers
necessary for the expansion of properties in its portfolio, debt reduction, the
acquisition of interests in new properties as suitable opportunities arise, and
such other factors as the board of trustees considers appropriate.
Cash dividends paid to common shareholders increased to $14.4 million in 2004
compared to $10.2 million in 2003.
Although the Company receives the majority of its rental payments on a monthly
basis, it intends to continue paying dividends quarterly. Amounts accumulated in
advance of each quarterly distribution are invested by the Company in short-term
money market or other suitable instruments.
The Company anticipates that cash flows from operations will continue to provide
adequate capital to fund its operating and administrative expenses, regular debt
service obligations and all dividend payments in accordance with REIT
requirements in both the short-term and long-term. In addition, the Company
anticipates that cash on hand, borrowings under its unsecured credit facility,
issuance of equity and debt, and other alternatives will be available to fund
the necessary capital required by the Company. Cash flows from operations were
$23.6 million and $13.2 million for the three months ended March 31, 2004 and
2003, respectively.
Net cash used in investing activities totaled $32.6 million and $29.5 million
for the three months ended March 31, 2004 and 2003, respectively. Cash used in
investing activities during each period was primarily attributable to the
acquisition of and deposits made for real estate and the investment in joint
ventures. Cash provided by investing activities relates to the sale of
properties. Therefore, the fluctuation in investing activities relates primarily
to the timing of investments and dispositions.
Net cash provided by financing activities totaled $80.8 million and $16.6
million for the three months ended March 31, 2004 and 2003, respectively. Cash
used in financing activities during each period was primarily attributable to
repayments under the Company's credit facility, dividends (net of proceeds
reinvested under the Company's dividend reinvestment plan), distributions to
limited partners and debt service payments. Cash provided by financing
activities relates primarily to proceeds from equity offerings and mortgage
financings.
UPREIT Structure. The Company's UPREIT structure permits the Company to effect
acquisitions by issuing to a seller, as a form of consideration, interests in
partnerships controlled by the Company. All of such interests are redeemable, at
the option of the holder, at certain times for common shares on a one-for-one
basis and all of such interests require the Company to pay certain distributions
to the holders of such interests in accordance with the respective partnership
agreements. The Company accounts for these interests in a manner similar to a
minority interest holder. The number of common shares that will be outstanding
in the future should be expected to
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increase, and minority interest expense should be expected to decrease, from
time to time, as such partnership interests are redeemed for common shares. The
table set forth below provides certain information with respect to such
partnership interests as of March 31, 2004, based on the current $1.40 annual
dividend.
Current Total Current
Total Annualized Annualized
Number Affiliate Per Unit Distribution
Redemption Date Of Units Units Distribution ($000)
- --------------- --------- --------- ------------ -------------
At any time 3,503,027 1,401,159 $ 1.40 $ 4,904
At any time 1,218,152 84,374 1.08 1,316
At any time 112,352 52,144 1.12 126
November 2004 24,552 2,856 - -
March 2005 29,384 - - -
March 2005 12,893 - 1.40 18
January 2006 171,168 416 - -
January 2006 231,763 120,662 1.40 324
February 2006 28,230 1,743 - -
May 2006 9,368 - 0.29 3
November 2006 44,858 44,858 1.40 63
--------- --------- ------------ -------------
5,385,747 1,708,212 $ 1.25 $ 6,754
========= ========= ============ =============
Affiliate units are held by two executive officers of the Company and are
included in the total number of units.
Financing
Revolving Credit Facility. The Company's $100.0 million unsecured credit
facility bears interest at LIBOR plus 150-250 basis points depending on the
amount of properties owned by the Company free and clear of mortgage debt. The
credit facility contains customary financial covenants including restrictions on
the level of indebtedness, amount of variable rate debt to be borrowed and net
worth maintenance provisions. As of March 31, 2004, the Company was in
compliance with all covenants, there were no borrowings outstanding on the
facility, $95.8 million was available to be borrowed and $4.2 million in letters
of credit were outstanding.
Financing Transactions. During the three months ending March 31, 2004, the
Company, including joint ventures, completed the following financing
transactions ($000's):
Current
Annual Maturity
Property Amount Rate Debt Service (Mo./Yr.) Balloon
- ----------------- -------- ---- ------------ --------- --------
Waterloo, IA $ 6,800 5.61% $ 672 2/13 $ 3,505
Mechanicsburg, PA 13,870 5.73% 1,045 3/14 10,501
Newport, OR 7,000 5.03% 470 8/11 5,980
Arlington, TX 22,000 5.81% 1,551 2/14 18,605
Moody, AL 7,675 4.98% 493 1/14 6,350
New Lenox, IL 17,400 5.51% 972 2/14 17,400
Mission, TX 6,570 5.78% 462 6/15 5,371
Redmond, OR 10,100 5.62% 697 4/14 8,484
Houston, TX 123,642 6.25% 10,866 9/15 33,811
Wall, NJ 30,036 6.25% 2,013 1/21 -
Centennial, CO 15,891 6.15% 1,177 2/13 13,555
Debt Service Requirements. The Company's principal liquidity needs are for the
payment of interest and principal on outstanding mortgage debt. As of March 31,
2004 a total of 65 of the Company's 105 consolidated properties were subject to
outstanding mortgages, which had an aggregate principal amount of $661.7
million, including discontinued operations. The weighted average interest rate
on the Company's total consolidated debt on such date was approximately 6.69%.
The estimated scheduled principal amortization payments for the remainder of
2004 and for 2005, 2006, 2007 and 2008 are $14.8 million, $21.0 million, $21.1
million, $25.8 million and $19.4 million,
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respectively. The estimated scheduled balloon payments for the remainder of 2004
and for 2005, 2006, 2007 and 2008, are $0, $12.5 million, $0, $0, and $70.5
million, respectively.
Lease Obligations. Since the Company's tenants bear all or substantially all of
the cost of property operations, maintenance and repairs, the Company does not
anticipate significant needs for cash for these costs. For seven of the
properties, the Company does have a level of property operating expense
responsibility. The Company generally funds property expansions with additional
secured borrowings, the repayment of which is funded out of rental increases
under the leases covering the expanded properties. To the extent there is a
vacancy in a property, the Company would be obligated for all operating
expenses, including real estate taxes and insurance. As of March 31, 2004, a
Company property in Phoenix, Arizona was vacant.
The Company's tenants pay the rental obligation on ground leases either directly
to the fee holder or to the Company as increased rent. The annual ground lease
rental payment obligation for each of the next five years is $0.9 million.
Origination Fees Payable. In connection with certain acquisitions, the Company
assumed obligations which bore interest on the outstanding principal balance
only at 12.5%. The scheduled annual payments for each of the next five years is
$0.1 per annum. As of March 31, 2004, $0.8 million is outstanding, of which $0.4
million is due to two executive officers of the Company.
The following summarizes the Company's principal contractual obligations as of
March 31, 2004 ($000's):
Remaining 2009 and
2004 2005 2006 2007 2008 thereafter Total
---------- -------- -------- -------- -------- ---------- --------
Mortgages payable - normal
amortization $ 14,771 $ 21,007 $ 21,095 $ 25,811 $ 19,425 $ 137,521 $239,630
Mortgages payable -
balloon maturities - 12,491(2) - - 70,492 339,064 422,047
Credit facility - - - - - - -
Operating lease obligations (1) 1,131 1,502 1,502 1,502 1,502 7,173 14,312
Deferred installment obligations 28 37 85 110 110 429 799
---------- -------- -------- -------- -------- ---------- --------
$ 15,930 $ 35,037 $ 22,682 $ 27,423 $ 91,529 $ 484,187 $676,788
(1) Amounts include rent for the Company's corporate office which is fixed
through 2008 and adjusted to fair market value as determined at January
2009.
(2) The Company has the ability to extend the maturity of this mortgage to
2006.
Capital Expenditures. Due to the net lease structure, the Company does not incur
significant expenditures in the ordinary course of business to maintain its
properties. However, in the future, as leases expire, the Company expects to
incur costs in extending the existing tenant lease or re-tenanting the
properties. The amounts of these expenditures can vary significantly depending
on tenant negotiations, market conditions and rental rates. These expenditures
are expected to be funded from operating cash flows or borrowings on the credit
facility.
Results of Operations
Three months ended March 31, 2004 compared with March 31, 2003
- --------------------------------------------------------------
Changes in the results of operations for the Company are primarily due to the
growth of its portfolio and costs associated with such growth. Of the increase
in total revenues in 2004 of $6.3 million, $5.3 million is attributable to
rental revenue which resulted primarily from (i) properties purchased in 2003
and owned for the entire quarter in 2004 ($3.9 million) and (ii) properties
purchased in 2004 ($1.5 million) offset by an increase in vacancy ($0.5
million). The remaining $1.0 million in revenue growth in 2004 was attributable
to an increase in advisory fees of $0.6 million and tenant reimbursements of
$0.4 million. The Company's general and administrative expenses increased by
$1.2 million due primarily to greater personal costs ($0.4 million), trustee
fees ($0.3 million) and occupancy costs ($0.2 million). The increase in property
operating expenses of $0.6 million is due primarily to the Company acquiring
properties in which it has property level operating expense responsibility. The
increase in equity in earnings of joint ventures of $0.5 million is attributable
to greater net income generated due to an increase in joint venture assets
owned. The Company recorded a provision for income taxes of $0.8 million
relating to the advisory fees generated and the earnings from real estate
investments held by its taxable REIT subsidiaries. Net income increased in 2004
due to the net impact of items discussed above plus an increase of $0.9 million
in
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income from discontinued operations due to an increase in the number of
properties sold and classified as held for sale and a $1.3 million increase in
gains on sale offset by a $1.7 million impairment charge.
The Company's non-consolidated entities had aggregate net income of $5.2 million
in the first quarter of 2004 compared to $3.8 million in the first quarter of
2003. The increase in net income is primarily attributable to an increase in
revenue of $5.6 million in 2004 attributable to the acquisition of properties in
2003 and 2004. These revenue sources were partially offset by an increase in (i)
interest expense of $1.9 million in 2004 due to partially funding of
acquisitions with the use of non-recourse mortgage debt, (ii) depreciation
expense of $1.3 million in 2004 due to more depreciable assets owned and (iii)
operating expenses of $0.9 million.
The increase in net income in future periods will be closely tied to the level
of acquisitions made by the Company. Without acquisitions, which in addition to
generating rental revenue, generate acquisition, debt placement and asset
management fees from joint ventures, the sources of growth in net income are
limited to index adjusted rents (such as the consumer price index), percentage
rents, reduced interest expense on amortizing mortgages and by controlling other
variable overhead costs. However, there are many factors beyond management's
control that could offset these items including, without limitation, increased
interest rates of variable debt ($15.2 million as of March 31, 2004 at a
weighted average interest rate of 4.07%) and tenant monetary defaults.
Funds From Operations
The Company believes that Funds From Operations ("FFO") enhances an investor's
understanding of the Company's financial condition, results of operations and
cash flows. The Company believes that FFO is an appropriate, but limited,
measure of the performance of an equity REIT. FFO is defined in the April 2002
"White Paper", issued by the National Association of Real Estate Investment
Trusts, Inc. ("NAREIT") as "net income (computed in accordance with generally
accepted accounting principles), excluding gains (or losses) from sales of
property, plus depreciation and amortization, and after adjustments for
unconsolidated partnerships and joint ventures. Adjustments for unconsolidated
partnerships and joint ventures will be calculated to reflect funds from
operations on the same basis." Impairment charges recorded are not added back to
net income in arriving at FFO. FFO should not be considered an alternative to
net income as an indicator of operating performance or to cash flows from
operating activities as determined in accordance with generally accepted
accounting principles, or as a measure of liquidity to other consolidated income
or cash flow statement data as determined in accordance with generally accepted
accounting principles.
The following table reconciles net income allocable to common shareholders to
the Company's FFO for the three months ended March 31, 2004, and 2003 ($000's):
2004 2003
-------- --------
Net income allocable to common shareholders $ 10,388 $ 8,763
Adjustments:
Depreciation and amortization 7,752 6,361
Minority interest's share of net income 928 1,239
Amortization of leasing commissions 181 200
Gains on sale of properties (1,737) (459)
Joint venture adjustment - depreciation 1,314 908
-------- --------
Funds From Operations $ 18,826 $ 17,012
======== ========
Cash flows from operating activities $ 23,568 $ 13,184
Cash flows from investing activities $(32,554) $(29,488)
Cash flows from financing activities $ 80,757 $ 16,627
Off-Balance Sheet Arrangements
Unconsolidated Real Estate Joint Ventures. The Company has investments in
various real estate joint ventures with varying structures. These investments
include the Company's 33 1/3% non-controlling interest in Lexington Acquiport
Company, LLC; its 25% non-controlling interest in Lexington Acquiport Company
II, LLC; its 40% non-controlling interest in Lexington Columbia LLC; its 30%
non-controlling interest in Lexington/Lion Venture L.P.; its 22.7%
non-controlling interest in Lexington Florence LLC; and its 33 1/3%
non-controlling interest in Lexington Durham Limited Partnership. The properties
owned by the joint ventures are financed with individual non-recourse mortgage
loans. Non-recourse mortgage debt is generally defined as debt whereby the
lenders' sole recourse with respect to borrower defaults is limited to the value
of the property collateralized by the mortgage. The lender generally does not
have recourse against any other assets owned by the borrower or any of the
members of the borrower, except for certain specified
17
expectations listed in the particular loan documents. These exceptions generally
relate to limited circumstances including breaches of material representations.
The Company invests in joint ventures with third parties to increase portfolio
diversification, reduce the amount of equity invested in any one property and to
increase returns on equity due to the realization of advisory fees. See footnote
6 to the condensed consolidated financial statements for combined summary
balance sheet and income statement data.
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ITEM 3. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK ($000's)
The Company's exposure to market risk relates primarily to its variable rate
debt. As of March 31, 2004 and 2003, the Company's variable rate indebtedness
was $15,151 and $80,549, respectively, which represented 2.3% and 14.6% of total
long-term indebtedness, respectively. During the three months ended March 31,
2004 and 2003, this variable rate indebtedness had a weighted average interest
rate of 3.2% and 4.0%, respectively. Had the weighted average interest rate been
100 basis points higher, the Company's net income for the three months ended
March 31, 2004 and 2003 would have been reduced by approximately $180 and $149,
respectively. As of March 31, 2004, the Company's fixed rate debt was $646,526
which represented 97.7% of total long-term indebtness. The weighted average
interest rate as of March 31, 2004 of fixed rate debt was 6.75%, which is
approximately 75 basis points higher than the fixed rate debt incurred by the
Company during 2004. With no fixed rate debt maturing until 2008, the Company
believes it has limited market risk exposure to rising interest rates as it
relates to its fixed rate debt obligations.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
(a) Disclosure Controls and Procedures. The Company's management, with the
participation of the Company's Chief Executive Officer and Chief Financial
Officer, has evaluated the effectiveness of the Company's disclosure controls
and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under
the Securities Exchange Act of 1934, as amended) as of the end of the period
covered by this report. Based on such evaluation, the Company's Chief Executive
Officer and Chief Financial Officer have concluded that, as of the end of such
period, the Company's disclosure controls and procedures are effective.
Internal Control Over Financial Reporting
(b) Internal Control Over Financial Reporting. There have not been any changes
in the Company's internal control over financial reporting during the fiscal
quarter to which this report relates that have materially affected, or are
reasonably likely to materially affect, the Company's internal control over
financial reporting.
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PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings - not applicable.
ITEM 2. Changes in Securities and Use of Proceeds - not applicable.
ITEM 3. Defaults Upon Senior Securities - not applicable.
ITEM 4. Submission of Matters to a Vote of Security Holders - not
applicable.
ITEM 5. Other Information - not applicable.
ITEM 6. Exhibits and Reports on Form 8-K.
31.1 Certification of Chief Executive Officer pursuant to rule
13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002 (filed herewith).
31.2 Certification of Chief Financial Officer pursuant to rule
13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002 (filed herewith).
32.1 Certification of Chief Executive Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 (furnished herewith).
32.2 Certification of Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 (furnished herewith).
(a) Reports on Form 8-K filed and/or furnished during the quarter
ended March 31, 2004:
Form 8-K (filed February 2, 2004)
Form 8-K (filed March 1, 2004)
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Lexington Corporate Properties Trust
Date: May 10, 2004 By: /s/ T. Wilson Eglin
-----------------------------------------
T. Wilson Eglin
Chief Executive Officer, President and
Chief Operating Officer
Date: May 10, 2004 By: /s/ Patrick Carroll
-----------------------------------------
Patrick Carroll
Chief Financial Officer, Executive Vice
President and Treasurer
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