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, 2002 OR
( ) 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 1-13102
FIRST INDUSTRIAL REALTY TRUST, INC.
(Exact name of Registrant as specified in its Charter)
MARYLAND 36-3935116
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
311 S. WACKER DRIVE, SUITE 4000, CHICAGO, ILLINOIS 60606
(Address of principal executive offices) (Zip Code)
(312) 344-4300
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
COMMON STOCK
(Title of class)
NEW YORK STOCK EXCHANGE
(Name of exchange on which registered)
DEPOSITARY SHARES EACH REPRESENTING 1/100 OF A SHARE OF 8.625% SERIES C
CUMULATIVE PREFERRED STOCK
DEPOSITARY SHARES EACH REPRESENTING 1/100 OF A SHARE OF 7.950% SERIES D
CUMULATIVE PREFERRED STOCK
DEPOSITARY SHARES EACH REPRESENTING 1/100 OF A SHARE OF 7.900% SERIES E
CUMULATIVE PREFERRED STOCK
(Title of class)
NEW YORK STOCK EXCHANGE
(Name of exchange on which registered)
Securities registered pursuant to Section 12(g) of the Act:
NONE
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. [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). Yes [X] No [ ].
The aggregate market value of the voting and non-voting stock held by
non-affiliates of the Registrant was approximately $1,228.7 million based on the
closing price on the New York Stock Exchange for such stock on June 28, 2002.
At March 7, 2003, 38,521,572 shares of the Registrant's Common Stock, $.01 par
value, were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Part III incorporates certain information by reference to the Registrant's
definitive proxy statement expected to be filed with the Securities and Exchange
Commission no later than 120 days after the end of the Registrant's fiscal year.
FIRST INDUSTRIAL REALTY TRUST, INC.
TABLE OF CONTENTS
<Table>
<Caption>
PAGE
----
PART I.
Item 1. Business ....................................................................................... 3
Item 2. The Properties................................................................................... 9
Item 3. Legal Proceedings................................................................................ 30
Item 4. Submission of Matters to a Vote of Security Holders.............................................. 30
PART II.
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters............................ 31
Item 6. Selected Financial Data.......................................................................... 32
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations............ 35
Item 7a. Quantitative and Qualitative Disclosures About Market Risk....................................... 50
Item 8. Financial Statements and Supplementary Data...................................................... 50
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures............ 50
PART III.
Item 10. Directors and Executive Officers of the Registrant............................................... 51
Item 11. Executive Compensation........................................................................... 51
Item 12. Security Ownership of Certain Beneficial Owners and Management................................... 51
Item 13. Certain Relationships and Related Transactions................................................... 51
Item 14. Controls and Procedures.......................................................................... 51
PART IV.
Item 15. Exhibits, Financial Statements, Financial Statement Schedule and Reports on Form 8-K............. 52
SIGNATURES.................................................................................................... 57
</Table>
1
This report contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. First Industrial Realty
Trust, Inc. (the "Company") intends such forward-looking statements to be
covered by the safe harbor provisions for forward-looking statements contained
in the Private Securities Litigation Reform Act of 1995, and is including this
statement for purposes of complying with those safe harbor provisions.
Forward-looking statements, which are based on certain assumptions and describe
future plans, strategies and expectations of the Company, are generally
identifiable by use of the words "believe," "expect," "intend," "anticipate,"
"estimate," "project" or similar expressions. The Company's ability to predict
results or the actual effect of future plans or strategies is inherently
uncertain. Factors which could have a material adverse affect on the operations
and future prospects of the Company on a consolidated basis include, but are not
limited to, changes in: economic conditions generally and the real estate market
specifically, legislative/regulatory changes (including changes to laws
governing the taxation of real estate investment trusts), availability of
financing, interest rate levels, competition, supply and demand for industrial
properties in the Company's current and proposed market areas, potential
environmental liabilities, slippage in development or lease-up schedules, tenant
credit risks, higher-than-expected costs and changes in general accounting
principles, policies and guidelines applicable to real estate investment trusts.
These risks and uncertainties should be considered in evaluating forward-looking
statements and undue reliance should not be placed on such statements. Further
information concerning the Company and its business, including additional
factors that could materially affect the Company's financial results, is
included herein and in the Company's other filings with the Securities and
Exchange Commission.
2
PART I
ITEM 1. BUSINESS
THE COMPANY
GENERAL
First Industrial Realty Trust, Inc. is a Maryland corporation organized
on August 10, 1993, and is a real estate investment trust ("REIT") under
Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the
"Code"). First Industrial Realty Trust, Inc., its consolidated partnerships,
limited liability companies and its wholly-owned entity (the "Company") is a
self-administered and fully integrated real estate company which owns, manages,
acquires, sells and develops industrial real estate. The Company completed its
initial public offering in June 1994 (the "Initial Offering"). Upon consummation
of the Initial Offering, the Company owned 226 industrial properties which
contained an aggregate of 17.4 million square feet of gross leasable area
("GLA"). As of December 31, 2002, the Company's portfolio consisted of 494 light
industrial properties, 167 R&D/flex properties, 126 bulk warehouse properties,
85 regional warehouse properties and 36 manufacturing properties containing
approximately 60.0 million square feet of GLA located in 24 states.
The Company's interests in its properties and land parcels are held
through partnerships controlled by the Company, including First Industrial, L.P.
(the "Operating Partnership"), of which the Company is the sole general partner,
as well as, among others, First Industrial Financing Partnership, L.P., First
Industrial Securities, L.P., First Industrial Mortgage Partnership, L.P., First
Industrial Pennsylvania, L.P., First Industrial Harrisburg, L.P., First
Industrial Indianapolis, L.P., FI Development Services, L.P. and TK-SV, LTD., of
which the sole general partner of each is a wholly-owned subsidiary of the
Company, and the sole limited partner of each is the Operating Partnership, as
well as limited liability companies of which the Operating Partnership is the
sole member. The Operating Partnership is also the sole stockholder of First
Industrial Development Services, Inc. The Company, through separate wholly-owned
limited liability companies of which the Operating Partnership is the sole
member, also owns minority equity interests in, and provides asset and property
management services to, three joint ventures which invest in industrial
properties.
The Company utilizes an operating approach which combines the
effectiveness of decentralized, locally based property management, acquisition,
sales and development functions with the cost efficiencies of centralized
acquisition, sales and development support, capital markets expertise, asset
management and fiscal control systems. At March 7, 2003, the Company had 322
employees.
The Company has grown and will seek to continue to grow through the
development and acquisition of additional industrial properties and through its
corporate services program.
The Company maintains a website at www.firstindustrial.com. Copies of
the Company's annual report on Form 10-K, quarterly reports on Form 10-Q,
current reports on Form 8-K, and amendments to such reports are available
without charge on the Company's website as soon as reasonably practicable after
such reports are filed or furnished with the SEC. In addition, the Company has
prepared supplemental financial and operating information which is available
without charge on the Company's website or upon request to the Company. Please
direct requests as follows:
First Industrial Realty Trust, Inc.
311 S. Wacker, Suite 4000
Chicago, IL 60606
Attention: Investor Relations
3
BUSINESS OBJECTIVES AND GROWTH PLANS
The Company's fundamental business objective is to maximize the total
return to its stockholders through increases in per share distributions and
increases in the value of the Company's properties and operations. The Company's
growth plans include the following elements:
o Internal Growth. The Company seeks to grow internally by (i) increasing
revenues by renewing or re-leasing spaces subject to expiring leases at
higher rental levels; (ii) increasing occupancy levels at properties
where vacancies exist and maintaining occupancy elsewhere; (iii)
controlling and minimizing property operating and general and
administrative expenses; (iv) renovating existing properties; and (v)
increasing ancillary revenues from non-real estate sources.
o External Growth. The Company seeks to grow externally through (i) the
development of industrial properties; (ii) the acquisition of
portfolios of industrial properties, industrial property businesses or
individual properties which meet the Company's investment parameters
and geographic target markets; and (iii) the expansion of its
properties.
o Corporate Services. Through its corporate services program, the Company
builds for, purchases from, and leases and sells industrial properties
to, companies that need to improve their industrial facility networks
and supply chain. The Company seeks to grow this business by targeting
both large and middle market public and private companies.
BUSINESS STRATEGIES
The Company utilizes the following six strategies in connection with
the operation of its business:
o Organization Strategy. The Company implements its decentralized
property operations strategy through the use of experienced regional
management teams and local property managers. Each operating region is
headed by a managing director, who is a senior executive officer of,
and has an equity interest in, the Company. The Company provides
acquisition, development and financing assistance, asset management
oversight and financial reporting functions from its headquarters in
Chicago, Illinois to support its regional operations. The Company
believes the size of its portfolio enables it to realize operating
efficiencies by spreading overhead among many properties and by
negotiating quantity purchasing discounts.
o Market Strategy. The Company's market strategy is to concentrate on the
top industrial real estate markets in the United States. These top
industrial real estate markets are based upon one or more of the
following characteristics: (i) the strength of the market's industrial
real estate fundamentals, including increased industrial demand
expectations from supply chain management; (ii) the history and future
outlook for continued economic growth and diversity; and (iii) a
minimum market size of 100 million square feet of industrial space.
o Disposition Strategy. The Company continues to evaluate local market
conditions and property-related factors in all of its markets and will
consider disposition of select assets.
o Acquisition/Development Strategy. The Company's acquisition/development
strategy is to concentrate on the top industrial real estate markets in
the United States. Of the 908 industrial properties in the Company's
portfolio at December 31, 2002, 168 properties have been developed by
either the Company or its former management. The Company will continue
to leverage the development capabilities of its management, many of
whom are leading developers in their respective markets.
o Financing Strategy. The Company plans on utilizing net sales proceeds
from property sales as well as borrowings under its $300 million
unsecured line of credit to finance future acquisitions and
developments. As of March 7, 2003, the Company had approximately $91.7
million available in additional borrowings under its $300 million
unsecured line of credit.
4
o Leasing and Marketing Strategy. The Company has an operational
management strategy designed to enhance tenant satisfaction and
portfolio performance. The Company pursues an active leasing strategy,
which includes aggressively marketing available space, seeking to renew
existing leases at higher rents per square foot and seeking leases
which provide for the pass-through of property-related expenses to the
tenant. The Company also has local and national marketing programs
which focus on the business and real estate brokerage communities and
national tenants.
RECENT DEVELOPMENTS
In 2002, the Company acquired or completed development of 107
properties and acquired several parcels of land for a total investment of
approximately $356.2 million. The Company also sold 110 in-service properties,
four properties that were out of service and several parcels of land for a gross
sales price of approximately $473.5 million. At December 31, 2002, the Company
owned 908 in-service properties containing approximately 60.0 million square
feet of GLA.
On April 1, 2002, the Company, through the Operating Partnership,
assumed a mortgage loan in the principal amount of approximately $5.8 million
which bears interest at a fixed rate of 8.26%, provides for monthly principal
and interest payments based on a 22-year amortization schedule and matures on
December 1, 2019.
On April 1, 2002, the Company, through the Operating Partnership,
assumed a mortgage loan in the principal amount of approximately $6.0 million
which bears interest at a fixed rate of 8.26%, provides for monthly principal
and interest payments based on a 22-year amortization schedule and matures on
December 1, 2019.
On June 14, 2002, the Company, through the Operating Partnership, paid
off and retired its $.7 million mortgage loan which bore interest at 8.00%,
provided for interest-only payments prior to maturity and was to mature 180 days
after the completion of a contingent event relating to the environmental status
of the property collateralizing the loan.
On July 2, 2002, the Company, through the Operating Partnership, paid
off and retired its $1.0 million mortgage loan which bore interest at 8.875%,
provided for monthly principal and interest payments based on a 20-year
amortization schedule and was to mature November 1, 2006.
On October 1, 2002, the Company, through the Operating Partnership,
paid off and retired its $36.8 million mortgage loan which bore interest at
7.50%, provided for monthly principal and interest payments based on a 25-year
amortization schedule and was to mature on April 1, 2003.
On December 4, 2002, the Company, through the Operating Partnership,
paid off and retired its $3.6 million mortgage loan which bore interest at
8.875%, provided for monthly principal and interest payments based on a 20-year
amortization schedule and was to mature on June 1, 2003.
On January 13, 2003, the Company, through the Mortgage Partnership,
paid off and retired its $40.2 million mortgage loan which bore interest at
7.22%, provided for monthly principal and interest payments based on a 28-year
amortization schedule and was to mature on January 11, 2026.
On April 15, 2002, the Company, through the Operating Partnership,
issued $200.0 million of senior unsecured debt which matures on April 15, 2012
and bears a coupon interest rate of 6.875%.
On April 15, 2002, the Company, through the Operating Partnership,
issued $50.0 million of senior unsecured debt which matures on April 15, 2032
and bears a coupon interest rate of 7.75%.
The Company received redemption notices from holders representing
approximately $84.9 million of the Company's $100.0 million senior unsecured
debt which was to mature on May 15, 2027 and bore a coupon interest rate of
7.15% (the "2027 Notes"). On May 15, 2002, the Company paid off and retired
$84.9 million of the 2027 Notes.
5
On September 27, 2002, the Company, through the Operating Partnership,
amended and restated its $300.0 million unsecured line of credit. The Company's
unsecured line of credit matures on September 30, 2005 and bears interest at a
floating rate of LIBOR plus .70%, or the Prime Rate, at the Company's election.
During the year ended December 31, 2002, the Company repurchased
1,091,500 shares of its common stock at a weighted average price of
approximately $27.02 per share.
During the period January 1, 2003 through March 7, 2003, the Company
acquired or completed development of two industrial properties for a total
estimated investment of approximately $26.7 million. The Company also sold six
industrial properties and two land parcels for approximately $15.7 million of
gross proceeds during this period.
From January 1, 2003 to March 7, 2003, the Company repurchased 37,300
shares of its common stock at a weighted average price of approximately $26.73
per share.
On March 5, 2003, the Company declared a first quarter 2003
distribution of $.685 per common share/unit on its common stock/units which is
payable on April 21, 2003. The Company also declared first quarter 2003
dividends of $53.906 per share ($.53906 per Depositary share), $49.687 per share
($.49687 per Depositary share) and $49.375 per share ($.49375 per Depositary
share) on its Series C Preferred Stock, Series D Preferred Stock and Series E
Preferred Stock, respectively, totaling, in the aggregate, approximately $5.0
million, which is payable on March 31, 2003.
6
FUTURE PROPERTY ACQUISITIONS, DEVELOPMENTS AND PROPERTY SALES
The Company has an active acquisition and development program through
which it is continually engaged in identifying, negotiating and consummating
portfolio and individual industrial property acquisitions and developments. As a
result, the Company is currently engaged in negotiations relating to the
possible acquisition and development of certain industrial properties located in
the United States.
The Company also sells properties based on market conditions and
property related factors. As a result, the Company is currently engaged in
negotiations relating to the possible sales of certain industrial properties in
the Company's current portfolio.
When evaluating potential industrial property acquisitions and
developments, as well as potential industrial property sales, the Company will
consider such factors as: (i) the geographic area and type of property; (ii) the
location, construction quality, condition and design of the property; (iii) the
potential for capital appreciation of the property; (iv) the ability of the
Company to improve the property's performance through renovation; (v) the terms
of tenant leases, including the potential for rent increases; (vi) the potential
for economic growth and the tax and regulatory environment of the area in which
the property is located; (vii) the potential for expansion of the physical
layout of the property and/or the number of sites; (viii) the occupancy and
demand by tenants for properties of a similar type in the vicinity; and (ix)
competition from existing properties and the potential for the construction of
new properties in the area.
7
INDUSTRY
Industrial properties are typically used for the design, assembly,
packaging, storage and distribution of goods and/or the provision of services.
As a result, the demand for industrial space in the United States is related to
the level of economic output. Historically, occupancy rates for industrial
property in the United States have been higher than those for other types of
commercial property. The Company believes that the higher occupancy rate in the
industrial property sector is a result of the construction-on-demand nature of,
and the comparatively short development time required for, industrial property.
For the five years ended December 31, 2002, the occupancy rates for industrial
properties in the United States have ranged from 88.8%* to 93.4%*, with an
occupancy rate of 88.8%* at December 31, 2002.
* SOURCE: TORTO WHEATON RESEARCH
8
ITEM 2. THE PROPERTIES
GENERAL
At December 31, 2002, the Company owned 908 in-service properties
containing approximately 60.0 million square feet of GLA in 24 states, with a
diverse base of more than 2,500 tenants engaged in a wide variety of businesses,
including manufacturing, retail, wholesale trade, distribution and professional
services. The properties are generally located in business parks that have
convenient access to interstate highways and/or rail and air transportation. The
weighted average age of the properties as of December 31, 2002 was approximately
17 years. The Company maintains insurance on its properties that the Company
believes is adequate.
The Company classifies its properties into five industrial categories:
light industrial, R&D/flex, bulk warehouse, regional warehouse and
manufacturing. While some properties may have characteristics which fall under
more than one property type, the Company uses what it feels is the most
dominating characteristic to categorize the property. The following describes
the different industrial categories:
o Light industrial properties generally are of less than 100,000
square feet, have a ceiling height of 16 to 21 feet, are
comprised of 5% - 50% of office space, contain less than 50%
of manufacturing space and have a land use ratio of 4:1. The
land use ratio is the ratio of the total property area to that
which is occupied by the building.
o R&D/flex buildings generally are of less than 100,000 square
feet, have a ceiling height of less than 16 feet, are
comprised of 50% or more of office space, contain less than
25% of manufacturing space and have a land use ratio of 4:1.
o Bulk warehouse buildings generally are of more than 100,000
square feet, have a ceiling height of at least 22 feet, are
comprised of 5% - 15% of office space, contain less than 25%
of manufacturing space and have a land use ratio of 2:1.
o Regional warehouses generally are of less than 100,000 square
feet, have a ceiling height of at least 22 feet, are comprised
of 5% - 15% of office space, contain less than 25% of
manufacturing space and have a land use ratio of 2:1.
o Manufacturing properties are a diverse category of buildings
that generally have a ceiling height of 10 - 18 feet, are
comprised of 5% - 15% of office space, contains at least 50%
of manufacturing space and have a land use ratio of 4:1.
9
Each of the properties is wholly owned by the Company. The following
tables summarize certain information as of December 31, 2002 with respect to the
Company's properties. Information in the tables excludes properties under
development at December 31, 2002.
PROPERTY SUMMARY
<Table>
<Caption>
Light Industrial R&D/ Flex Bulk Warehouse Regional Warehouse
---------------------- ---------------------- ---------------------- ----------------------
Metropolitan Number of Number of Number of Number of
Area GLA Properties GLA Properties GLA Properties GLA Properties
- --------------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Atlanta, GA 598,218 11 294,074 7 3,463,072 10 383,935 5
Baltimore, MD 766,053 13 78,418 1 292,659 2 -- --
Central
Pennsylvania 383,070 4 -- -- 1,089,486 6 117,579 3
Chicago, IL 1,688,323 30 247,084 4 2,621,892 12 218,811 3
Cincinnati, OH 334,220 2 -- -- 1,348,880 6 -- --
Columbus, OH 217,612 2 -- -- 947,934 3 -- --
Dallas, TX 1,866,246 50 492,540 20 1,442,188 9 795,077 12
Dayton, OH 322,746 6 20,000 1 -- -- -- --
Denver, CO 1,837,873 38 1,607,297 41 538,906 4 480,549 8
Des Moines, IA -- -- -- -- -- -- 88,000 1
Detroit, MI 2,520,536 93 435,812 16 658,643 6 783,443 18
Grand Rapids, MI 61,250 1 -- -- -- -- -- --
Houston, TX 536,211 7 200,112 3 1,939,227 12 365,960 5
Indianapolis, IN 767,980 17 48,200 4 3,181,022 12 277,710 7
Los Angeles, CA 328,420 20 87,593 7 976,597 4 276,284 6
Louisville, KY -- -- -- -- 443,500 2 -- --
Milwaukee, WI 146,061 3 93,705 2 100,000 1 39,468 1
Minneapolis/
St Paul, MN 1,048,478 19 661,405 10 1,472,695 7 550,846 5
Nashville, TN 301,865 6 -- -- 1,806,459 10 -- --
N. New Jersey 1,510,436 29 564,008 13 1,122,360 6 58,585 1
Philadelphia, PA 1,185,246 27 128,059 5 257,720 2 258,190 4
Phoenix, AZ 38,560 1 -- -- -- -- 82,288 1
Portland, OR 635,825 24 -- -- -- -- -- --
Salt Lake City, UT 592,010 40 146,937 6 -- -- -- --
S. New Jersey 980,828 22 -- -- 323,750 2 209,300 3
St. Louis, MO 466,969 7 -- -- 655,719 5 -- --
Tampa, FL 607,592 19 737,016 27 -- -- 41,377 1
Other(a) 99,000 3 -- -- 824,355 5 50,000 1
---------- --- ---------- --- ---------- --- ---------- ---
Total 19,841,628 494 5,842,260 167 25,507,064 126 5,077,402 85
========== === ========== === ========== === ========== ===
<Caption>
Manufacturing
----------------------
Metropolitan Number of
Area GLA Properties
- --------------- ---------- ----------
Atlanta, GA 298,000 2
Baltimore, MD 171,000 1
Central
Pennsylvania 70,000 1
Chicago, IL 461,531 3
Cincinnati, OH -- --
Columbus, OH 255,470 1
Dallas, TX 224,984 2
Dayton, OH -- --
Denver, CO -- --
Des Moines, IA -- --
Detroit, MI -- --
Grand Rapids, MI 413,500 1
Houston, TX -- --
Indianapolis, IN 71,600 2
Los Angeles, CA -- --
Louisville, KY -- --
Milwaukee, WI -- --
Minneapolis/
St Paul, MN 1,210,729 13
Nashville, TN 109,058 1
N. New Jersey -- --
Philadelphia, PA 56,827 2
Phoenix, AZ -- --
Portland, OR -- --
Salt Lake City, UT -- --
S. New Jersey 22,738 1
St. Louis, MO -- --
Tampa, FL -- --
Other(a) 346,103 6
---------- ---
Total 3,711,540 36
========== ===
</Table>
(a) Properties are located in Denton, Texas; Abilene, Texas; McAllen,
Texas; Austin, Texas; Wichita, Kansas; West Lebanon, New Hampshire and
Sparks, Nevada.
10
PROPERTY SUMMARY TOTALS
<Table>
<Caption>
TOTALS
-----------------------------------------------------
GLA AS A %
NUMBER OF OCCUPANCY AT OF TOTAL
METROPOLITAN AREA GLA PROPERTIES 12/31/02 PORTFOLIO
----------------- ---------- ---------- ------------ ----------
Atlanta, GA 5,037,299 35 96% 8.4%
Baltimore, MD 1,308,130 17 90% 2.2%
Central Pennsylvania 1,660,135 14 72% 2.8%
Chicago, IL 5,237,641 52 87% 8.7%
Cincinnati, OH 1,683,100 8 88% 2.8%
Columbus, OH 1,421,016 6 93% 2.4%
Dallas, TX 4,821,035 93 90% 8.0%
Dayton, OH 342,746 7 91% 0.6%
Denver, CO 4,464,625 91 90% 7.5%
Des Moines, IA 88,000 1 90% 0.1%
Detroit, MI 4,398,434 133 91% 7.3%
Grand Rapids, MI 474,750 2 100% 0.8%
Houston, TX 3,041,510 27 89% 5.1%
Indianapolis, IN 4,346,512 42 90% 7.3%
Los Angeles, CA 1,668,894 37 93% 2.8%
Louisville, KY 443,500 2 89% 0.7%
Milwaukee, WI 379,234 7 90% 0.6%
Minneapolis/St. Paul, MN 4,944,153 54 88% 8.2%
Nashville, TN 2,217,382 17 85% 3.7%
N. New Jersey 3,255,389 49 91% 5.4%
Philadelphia, PA 1,886,042 40 94% 3.1%
Phoenix, AZ 120,848 2 68% 0.2%
Portland, OR 635,825 24 95% 1.1%
Salt Lake City, UT 738,947 46 84% 1.2%
S. New Jersey 1,536,616 28 93% 2.6%
St. Louis, MO 1,122,688 12 87% 1.9%
Tampa, FL 1,385,985 47 85% 2.3%
Other(a) 1,319,458 15 89% 2.2%
---------- --- --- -----
Total or Average 59,979,894 908 90% 100.0%
========== === === =====
</Table>
(a) Properties are located in Denton, Texas; Abilene, Texas; McAllen,
Texas; Austin, Texas; Wichita, Kansas; West Lebanon, New Hampshire and
Sparks, Nevada.
11
PROPERTY ACQUISITION ACTIVITY
During 2002, the Company acquired 90 in-service industrial properties
totaling approximately 5.7 million square feet of GLA at a total purchase price
of approximately $237.4 million, or approximately $41.91 per square foot. The
Company also purchased several land parcels for an aggregate purchase price of
approximately $2.0 million. The 90 industrial properties acquired have the
following characteristics:
<Table>
<Caption>
NUMBER OF OCCUPANCY
METROPOLITAN AREA PROPERTIES GLA PROPERTY TYPE AT 12/31/02
- -------------------------- ---------- --------- ---------------------------------------- -----------
Philadelphia, PA 14 765,489 R&D/Flex/Light Industrial 92%
Chicago, IL 1 50,050 Light Industrial 100%
Los Angeles, CA 2 464,800 Bulk Warehouse 100%
Northern New Jersey 3 281,926 Bulk Warehouse 87%
St. Louis, MO 4 332,630 Light Industrial 100%
Denver, CO(b) 1 81,564 Regional Warehouse N/A
Los Angeles, CA 7 105,005 R&D/Flex/Light Industrial 91%
Chicago, IL(a) 1 389,155 Bulk Warehouse N/A
Sparks, NV 1 490,500 Bulk Warehouse 100%
Los Angeles, CA 1 396,095 Bulk Warehouse 100%
Houston, TX 3 131,000 Light Industrial 100%
Los Angeles, CA(d) 8 195,701 Reg. Warehouse/Light Industrial/R&D/Flex 88%
Philadelphia, PA 1 64,402 Light Industrial 73%
Dallas, TX 6 422,026 Bulk Warehouse/Light Industrial 100%
Dallas, TX(b) 1 49,177 Light Industrial N/A
Atlanta, GA(b) 1 75,600 Regional Warehouse N/A
Dallas, TX(d) 18 450,360 Reg. Warehouse/Light Industrial/R&D/Flex 94%
Northern New Jersey 8 409,240 Light Industrial 90%
Northern New Jersey(d) 1 45,770 Light Industrial 100%
Phoenix, AZ 1 82,288 Regional Warehouse 100%
Indianapolis, IN(c)(d) 2 121,600 Light Industrial N/A
Chicago, IL 2 158,791 R&D/Flex/Light Industrial 84%
Los Angeles, CA 3 103,008 Regional Warehouse 99%
--- ---------
90 5,666,177
=== =========
</Table>
(a) Property was sold in 2002.
(b) Property was placed out of service.
(c) One property was sold in 2002.
(d) Purchased from one of the Company's industrial real estate joint ventures
in 2002.
12
PROPERTY DEVELOPMENT ACTIVITY
During 2002, the Company placed in-service 17 developments totaling
approximately 3.2 million square feet of GLA at a total cost of approximately
$116.8 million, or approximately $36.77 per square foot. The developed
properties have the following characteristics:
<Table>
<Caption>
OCCUPANCY
METROPOLITAN AREA GLA PROPERTY TYPE AT 12/31/02
- -------------------- --------- ------------------ -----------
Phoenix, AZ(a) 73,802 Regional Warehouse N/A
Harrisburg, PA(a)(c) 181,990 Bulk Warehouse N/A
Atlanta, GA(a)(c) 527,000 Bulk Warehouse N/A
Dallas, TX 102,232 Regional Warehouse 85%
Phoenix, AZ(a)(c) 54,455 Light Industrial N/A
Harrisburg, PA(b)(c) 67,200 Regional Warehouse N/A
Chicago, IL(a) 53,330 N/A N/A
Dallas, TX(a) 472,200 Bulk Warehouse N/A
Baltimore, MD(a) 43,978 Light Industrial N/A
Dallas, TX(a)(c) 36,000 Light Industrial N/A
Tampa, FL(a)(c) 360,000 N/A N/A
Denver, CO(a)(c) 42,380 Light Industrial N/A
Atlanta, GA(a)(c) 455,000 Bulk Warehouse N/A
Nashville, TN 423,500 Bulk Warehouse 100%
Northern New Jersey 62,400 Light Industrial 92%
Phoenix, AZ(a)(c) 18,881 Light Industrial N/A
Atlanta, GA(a)(c) 202,400 Bulk Warehouse N/A
---------
3,176,748
=========
</Table>
(a) Property was placed in-service and sold in 2002.
(b) Property was sold in 2002.
(c) Property was sold to one of the Company's industrial real estate joint
ventures in 2002.
At December 31, 2002, the Company had 31 projects under development, with
an estimated completion GLA of approximately 2.8 million square feet and an
estimated completion cost of approximately $155.9 million. The Company estimates
it will place in service all of the projects in fiscal year 2003. There can be
no assurance that the Company will place in service these projects in 2003 or
that the actual completion cost will not exceed the estimated completion cost
stated above.
13
PROPERTY SALES
During 2002, the Company sold 110 in-service industrial properties and
four out-of-service properties totaling approximately 11.9 million square feet
of GLA and several land parcels. Total gross sales proceeds approximated $473.5
million. The 110 in-service properties and four out-of-service properties sold
have the following characteristics:
<Table>
<Caption>
NUMBER OF
METROPOLITAN AREA PROPERTIES GLA PROPERTY TYPE
- ---------------------- ---------- --------- -----------------------------------
Long Island, NY 1 34,400 Light Industrial
Grand Rapids, MI 1 31,750 Manufacturing
Grand Rapids, MI 1 42,600 Light Industrial
Northern New Jersey 1 52,402 Regional Warehouse
Tampa, FL 1 26,716 R&D/Flex
Dallas, TX 1 82,229 Light Industrial
Dallas, TX 1 74,106 Regional Warehouse
St. Louis, MO 1 31,500 Light Industrial
St. Louis, MO 1 31,500 Light Industrial
Phoenix, AZ 2 132,261 Regional Warehouse/Light Industrial
Portland, OR 1 21,600 Light Industrial
Harrisburg, PA(b) 1 181,990 Bulk Warehouse
Northern New Jersey(b) 1 46,000 R&D/Flex
Denver, CO(b) 1 59,270 R&D/Flex
Atlanta, GA(b) 1 527,000 Bulk Warehouse
Detroit, MI 1 48,000 R&D/Flex
Harrisburg, PA 4 1,016,354 Bulk Warehouse
Chicago, IL 1 34,875 Light Industrial
Indianapolis, IN 1 389,660 Bulk Warehouse
Los Angeles, CA 1 7,300 Light Industrial
Chicago, IL 1 56,017 Light Industrial
Grand Rapids, MI 1 109,875 Bulk Warehouse
Nashville, TN 1 49,922 Light Industrial
Chicago, IL(a) 1 66,000 Regional Warehouse
Grand Rapids, MI 2 158,335 Light Industrial/Bulk Warehouse
Long Island, NY 1 29,300 Light Industrial
Long Island, NY 5 174,169 Light Industrial
Indianapolis, IN(b) 1 100,000 Bulk Warehouse
Atlanta, GA 1 123,808 Bulk Warehouse
Atlanta, GA(b) 1 123,457 Bulk Warehouse
Harrisburg, PA 2 537,720 Bulk Warehouse
Northern New Jersey 1 17,500 Light Industrial
Northern New Jersey 1 17,997 Light Industrial
Northern New Jersey 1 70,800 Light Industrial
Northern New Jersey 1 29,008 Light Industrial
Northern New Jersey 1 17,531 Light Industrial
Phoenix, AZ(b) 1 54,455 Light Industrial
Portland, OR 1 35,000 Light Industrial
Chicago, IL 1 90,833 Bulk Warehouse
Dallas, TX 1 36,000 Light Industrial
Chicago, IL(a) 1 200,000 Manufacturing
Chicago, IL(a) 1 34,596 Light Industrial
Chicago, IL 1 151,436 Bulk Warehouse
Detroit, MI 1 41,500 Light Industrial
Grand Rapids, MI 1 14,400 Light Industrial
Chicago, IL 1 53,330 N/A
Baltimore, MD 1 43,978 Light Industrial
Dallas, TX 1 472,200 Bulk Warehouse
Denver, CO 1 22,735 R&D/Flex
Dallas, TX(b) 1 36,000 Light Industrial
Denver, CO(b) 1 42,380 Light Industrial
Denver, CO(b) 1 32,741 Light Industrial
Harrisburg, PA(b) 1 67,200 Regional Warehouse
Tampa, FL(b) 1 360,000 N/A
Northern New Jersey 1 79,750 Regional Warehouse
Atlanta, GA(b) 1 455,000 Bulk Warehouse
Chicago, IL 1 389,155 Bulk Warehouse
Des Moines, IA 3 604,708 Bulk Warehouse
Detroit, MI(b) 1 145,232 Bulk Warehouse
Northern New Jersey 1 18,000 Light Industrial
Philadelphia, PA 1 19,965 Light Industrial
</Table>
14
<Table>
<Caption>
NUMBER OF
METROPOLITAN AREA PROPERTIES GLA PROPERTY TYPE
- ------------------------ ---------- ---------- -----------------------------------
Houston, TX 1 66,565 Regional Warehouse
Northern New Jersey 1 24,905 R&D/Flex
Detroit, MI 1 48,200 R&D/Flex
Portland, OR 1 27,128 Light Industrial
St. Louis, MO 1 178,800 Bulk Warehouse
Grand Rapids, MI 1 101,250 Bulk Warehouse
Los Angeles, CA 1 7,300 Light Industrial
Chicago, IL 1 124,804 Bulk Warehouse
Houston, TX(a) 1 251,850 Bulk Warehouse
Milwaukee, WI 1 38,230 Regional Warehouse
Philadelphia, PA 1 110,000 Bulk Warehouse
Portland, OR 1 20,000 Light Industrial
Phoenix, AZ(b) 1 18,881 Light Industrial
Atlanta, GA(b) 1 202,400 Bulk Warehouse
Tampa, FL 2 172,000 Light Industrial/Regional Warehouse
Grand Rapids, MI 15 1,856,726 Light Industrial/Bulk
Warehouse/R&D Flex
Chicago, IL 1 41,423 Light Industrial
Detroit, MI 1 21,850 R&D/Flex
Indianapolis, IN 1 81,600 Light Industrial
Denver, CO 1 20,389 Light Industrial
Cleveland, OH 1 102,500 R&D/Flex
Portland, OR 1 5,000 Light Industrial
Detroit, MI 1 25,470 Light Industrial
Chicago, IL 1 64,080 R&D/Flex
Atlanta, GA 1 121,600 Manufacturing
Detroit, MI 1 88,700 Light Industrial
--- ----------
114 11,875,197
=== ==========
</Table>
(a) Property was out-of-service when sold.
(b) Property was sold to one of the Company's industrial real estate joint
ventures in 2002.
15
PROPERTY ACQUISITIONS, DEVELOPMENTS AND SALES SUBSEQUENT TO YEAR END
During the period January 1, 2003 through March 7, 2003, the Company
acquired or completed development of two industrial properties for a total
estimated investment of approximately $26.7 million. The Company also sold six
industrial properties and two land parcels for approximately $15.7 million of
gross proceeds during this period.
16
DETAIL PROPERTY LISTING
The following table lists all of the Company's properties as of December
31, 2002, by geographic market area.
PROPERTY LISTING
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- --------- --------- ------------
ATLANTA
4250 River Green Parkway Duluth, GA (a) 1988 R&D/Flex 2.14 28,942 100%
3400 Corporate Parkway Duluth, GA (a) 1987 Light Industrial 3.73 59,959 86%
3450 Corporate Parkway Duluth, GA (a) 1988 R&D/Flex 2.38 37,346 64%
3500 Corporate Parkway Duluth, GA (a) 1991 R&D/Flex 2.80 44,242 100%
3425 Corporate Parkway Duluth, GA (a) 1990 R&D/Flex 3.49 43,006 77%
1650 GA Highway 155 McDonough, GA 1991 Bulk Warehouse 12.80 228,400 100%
14101 Industrial Park Blvd. Covington, GA 1984 Light Industrial 9.25 92,160 100%
801-804 Blacklawn Road Conyers, GA 1982 Bulk Warehouse 6.67 111,185 61%
1665 Dogwood Drive Conyers, GA 1973 Manufacturing 9.46 198,000 100%
1715 Dogwood Drive Conyers, GA 1973 Manufacturing 4.61 100,000 100%
11235 Harland Drive Covington, GA 1988 Light Industrial 5.39 32,361 100%
4050 Southmeadow Parkway Atlanta, GA 1991 Reg. Warehouse 6.60 87,328 100%
4051 Southmeadow Parkway Atlanta, GA 1989 Bulk Warehouse 11.20 151,935 100%
4071 Southmeadow Parkway Atlanta, GA 1991 Bulk Warehouse 17.80 209,918 100%
3312 N. Berkeley Lake Road Duluth, GA 1969 Bulk Warehouse 52.11 1,040,296 100%
370 Great Southwest Pkway(g) Atlanta, GA 1986 Light Industrial 8.06 150,536 85%
955 Cobb Place Kennesaw, GA 1991 Reg. Warehouse 8.73 97,518 18%
2084 Lake Industrial Court Conyers, GA 1998 Bulk Warehouse 13.74 180,000 100%
2039 Monier Blvd Lithia
Springs, GA 1999 Bulk Warehouse 10.00 110,000 100%
1005 Sigman Road Conyers, GA 1986 Bulk Warehouse 9.12 127,338 100%
2050 East Park Drive Conyers, GA 1998 Reg. Warehouse 5.46 90,289 100%
201 Greenwood McDonough, GA 1999 Bulk Warehouse 39.00 800,000 100%
220 Greenwood McDonough, GA 2000 Bulk Warehouse 26.69 504,000 100%
1255 Oakbrook Drive Norcross, GA 1984 Light Industrial 2.50 36,000 0%
1256 Oakbrook Drive Norcross, GA 1984 Light Industrial 3.48 40,504 100%
1265 Oakbrook Drive Norcross, GA 1984 Light Industrial 3.52 51,200 100%
1266 Oakbrook Drive Norcross, GA 1984 Light Industrial 3.62 30,378 100%
1275 Oakbrook Drive Norcross, GA 1986 Reg. Warehouse 4.36 62,400 100%
1280 Oakbrook Drive Norcross, GA 1986 Reg. Warehouse 4.34 46,400 100%
1300 Oakbrook Drive Norcross, GA 1986 Light Industrial 5.41 52,000 100%
1325 Oakbrook Drive Norcross, GA 1986 Light Industrial 3.53 53,120 100%
1351 Oakbrook Drive Norcross, GA 1984 R&D/Flex 3.93 36,600 84%
1346 Oakbrook Drive Norcross, GA 1985 R&D/Flex 5.52 74,538 100%
1412 Oakbrook Drive Norcross, GA 1985 R&D/Flex 2.89 29,400 85%
--------- -----
SUBTOTAL OR AVERAGE 5,037,299 96%
--------- -----
BALTIMORE
3431 Benson Baltimore, MD 1988 Light Industrial 3.48 60,227 100%
1801 Portal Baltimore, MD 1987 Light Industrial 3.72 57,600 83%
1811 Portal Baltimore, MD 1987 Light Industrial 3.32 60,000 100%
1831 Portal Baltimore, MD 1990 Light Industrial 3.18 46,522 100%
1821 Portal Baltimore, MD 1986 Light Industrial 4.63 86,234 100%
1820 Portal Baltimore, MD (e) 1982 Bulk Warehouse 6.55 171,000 100%
6615 Tributary Baltimore, MD 1987 Light Industrial 4.36 65,860 100%
7340 Executive Frederick, MD 1988 R&D/Flex 9.38 78,418 77%
4845 Governers Way Frederick, MD 1988 Light Industrial 5.47 83,064 13%
8900 Yellow Brick Road Baltimore, MD 1982 Light Industrial 5.80 60,000 100%
7476 New Ridge Hanover, MD 1987 Light Industrial 18.00 71,866 100%
1328 Charwood Road Hanover, MD 1986 Bilk Warehouse 9.00 150,500 100%
8779 Greenwood Place Savage, MD 1978 Bulk Warehouse 8.00 142,159 100%
1350 Blair Drive Odenton, MD 1991 Light Industrial 2.86 29,317 95%
1360 Blair Drive Odenton, MD 1991 Light Industrial 4.19 43,194 83%
1370 Blair Drive Odenton, MD 1991 Light Industrial 5.15 52,910 49%
1920 Mendenhall Court Columbia, MD 1981 Light Industrial 3.70 49,259 100%
--------- -----
SUBTOTAL OR AVERAGE 1,308,130 90%
--------- -----
CENTRAL PENNSYLVANIA
1214-B Freedom Road Cranberry, PA 1982 Reg. Warehouse 5.99 32,779 0%
401 Russell Drive Middletown, PA 1990 Reg. Warehouse 5.20 52,800 48%
2700 Commerce Drive Middletown, PA 1990 Reg. Warehouse 3.60 32,000 100%
2701 Commerce Drive Middletown, PA 1989 Light Industrial 6.40 48,000 100%
2780 Commerce Drive Middletown, PA 1989 Light Industrial 2.00 21,600 100%
7125 Grayson Road Harrisburg, PA 1991 Bulk Warehouse 17.17 300,000 33%
7253 Grayson Road Harrisburg, PA 1990 Bulk Warehouse 12.42 198,386 100%
5020 Louise Drive Mechanicsburg, PA 1995 Light Industrial 5.06 49,350 63%
7195 Grayson Road Harrisburg, PA 1994 Bulk Warehouse 6.02 100,000 100%
</Table>
17
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- --------- --------- ------------
CENTRAL PENNSYLVANIA (CONT.)
3380 Susquehanna Trail North York, PA 1990 Bulk Warehouse 10.00 112,500 100%
495 East Locust Lane York, PA 1993/94 Bulk Warehouse 15.00 200,000 100%
350 Old Silver Spring Road Mechanicsburg, PA 1968/97 Light Industrial 20.00 264,120 100%
4500 Westport Drive Mechanicsburg, PA 1996 Bulk Warehouse 11.20 178,600 0%
125 East Kensinger Drive Cranberry
Township, PA 2000 Reg. Warehouse 13.00 70,000 100%
--------- ---
SUBTOTAL OR AVERAGE 1,660,135 72%
--------- ---
CHICAGO
720-730 Landwehr Road Northbrook, IL (a) 1978 Light Industrial 4.29 66,912 34%
20W201 101st Street Lemont, IL (a) 1988 Bulk Warehouse 8.72 160,201 100%
2300 Hammond Drive Schaumburg, IL 1970 Light Industrial 4.13 77,000 50%
3600 West Pratt Avenue Lincolnwood, IL 1953/88 Bulk Warehouse 6.35 204,679 99%
6750 South Sayre Avenue Bedford Park, IL 1975 Light Industrial 2.51 63,383 100%
585 Slawin Court Mount Prospect, IL 1992 R&D/Flex 3.71 38,150 0%
2300 Windsor Court Addison, IL 1986 Bulk Warehouse 6.80 105,100 100%
3505 Thayer Court Aurora, IL 1989 Light Industrial 4.60 64,220 100%
3600 Thayer Court Aurora, IL 1989 Light Industrial 6.80 66,958 73%
736-776 Industrial Drive Elmhurst, IL 1975 Light Industrial 3.79 80,180 82%
480 East 14th St. Chicago Heights, IL 1958 Bulk Warehouse 11.66 284,135 74%
305-311 Era Drive Northbrook, IL 1978 Light Industrial 1.82 27,549 100%
4330 South Racine Avenue Chicago, IL 1978 Manufacturing 5.57 168,000 100%
12241 Melrose Street Franklin Park, IL 1969 Light Industrial 2.47 77,301 49%
3150-3160 MacArthur
Boulevard Northbrook, IL 1978 Light Industrial 2.14 41,780 100%
2942 MacArthur Boulevard Northbrook, IL 1979 R&D/Flex 3.12 49,730 100%
305-307 East North Avenue Carol Stream, IL 1999 Reg. Warehouse 0.00 50,009 100%
301 Alice Wheeling, IL 1965 Light Industrial 2.88 65,450 100%
11939 South Central Avenue Alsip, IL 1972 Bulk Warehouse 12.60 320,171 100%
405 East Shawmut LaGrange, IL 1965 Light Industrial 3.39 59,075 100%
1010-50 Sesame Street Bensenville, IL 1976 Manufacturing 8.00 252,000 100%
5555 West 70th Place Bedford Park, IL 1973 Manufacturing 2.50 41,531 100%
3200-3250 South St.
Louis(g) Chicago, IL 1968 Light Industrial 8.66 74,685 50%
3110-3130 South St. Louis Chicago, IL 1968 Light Industrial 4.00 23,254 0%
7401 South Pulaski Chicago, IL 1975/86 Bulk Warehouse 5.36 213,670 96%
7501 South Pulaski Chicago, IL 1975/86 Bulk Warehouse 3.88 159,728 100%
385 Fenton Lane West Chicago, IL 1990 Bulk Warehouse 6.79 180,417 100%
335 Crossroad Parkway Bolingbrook, IL 1996 Bulk Warehouse 12.86 288,000 66%
10435 Seymour Avenue Franklin Park, IL 1967/74 Light Industrial 1.85 53,684 43%
905 Paramount Batavia, IL 1977 Light Industrial 2.60 60,000 100%
1005 Paramount Batavia, IL 1978 Light Industrial 2.50 64,574 100%
2120-24 Roberts Broadview, IL 1960 Light Industrial 2.30 60,009 100%
405-17 University Drive Arlington Hgts, IL 1977/78 Light Industrial 2.42 56,400 75%
3575 Stern Avenue St. Charles, IL 1979/84 Reg. Warehouse 2.73 68,728 100%
3810 Stern Avenue St. Charles, IL 1985 Reg. Warehouse 4.67 100,074 100%
315 Kirk Road St. Charles, IL 1969/93/95 Bulk Warehouse 12.42 309,600 100%
700 Business Center Drive Mount Prospect, IL 1980 Light Industrial 3.12 34,800 100%
555 Business Center Drive Mount Prospect, IL 1981 Light Industrial 2.96 31,175 100%
800 Business Center Drive Mount Prospect, IL 1988/99 Light Industrial 5.40 81,610 100%
580 Slawin Court Mount Prospect, IL 1985 Light Industrial 2.08 30,225 100%
1150 Feehanville Mount Prospect, IL 1983 Light Industrial 2.74 33,600 100%
1200 Business Center Drive Mount Prospect, IL 1988/2000 Light Industrial 6.68 106,000 100%
1331 Business Center Drive Mount Prospect, IL 1985 Light Industrial 3.12 30,380 100%
3627 Stern Avenue St. Charles, IL 1979 Light Industrial 1.84 30,000 100%
301-329 Airport Blvd. North Aurora, IL 1997 Light Industrial 8.05 92,527 100%
19W661 101st Street Lemont, IL 1988 Bulk Warehouse 10.94 248,791 100%
19W751 101st Street Lemont, IL 1991 Bulk Warehouse 7.13 147,400 0%
175 Wall Street Glendale
Heights, IL 1990 Light Industrial 4.10 50,050 100%
800-820 Thorndale Avenue Bensenville, IL 1985 R&D/Flex 5.56 73,249 100%
830-890 Supreme Drive Bensenville, IL 1981 Light Industrial 4.77 85,542 72%
1661 Feehanville Drive Mount Prospect, IL 1986 R&D/Flex 6.89 85,955 69%
--------- ---
SUBTOTAL OR AVERAGE 5,237,641 87%
--------- ---
CINCINNATI
9900-9970 Princeton Cincinnati, OH 1970 Bulk Warehouse 10.64 185,580 79%
2940 Highland Avenue Cincinnati, OH 1969/74 Bulk Warehouse 17.08 502,000 87%
4700-4750 Creek Road Blue Ash, OH 1960 Light Industrial 15.32 265,000 90%
12072 Best Place Springboro, OH 1984 Bulk Warehouse 7.80 112,500 55%
901 Pleasant Valley Drive Springboro, OH 1984/94 Light Industrial 7.70 69,220 100%
4440 Mulhauser Road Cincinnati, OH 1999 Bulk Warehouse 15.26 240,000 100%
4434 Mulhauser Road Cincinnati, OH 1999 Bulk Warehouse 25.00 140,800 82%
9449 Glades Road Hamilton, OH 1999 Bulk Warehouse 7.40 168,000 100%
--------- ---
SUBTOTAL OR AVERAGE 1,683,100 88%
--------- ---
COLUMBUS
3800 Lockbourne
Industrial Pky Columbus, OH 1986 Bulk Warehouse 22.12 404,734 100%
1819 North Walcutt Road Columbus, OH 1973 Bulk Warehouse 11.33 243,000 61%
</Table>
18
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
COLUMBUS (CONT.)
4300 Cemetery Road Hilliard, OH 1968/83 Manufacturing 62.71 255,470 100%
4115 Leap Road (g) Hilliard, OH 1977 Light Industrial 18.66 217,612 100%
3300 Lockbourne Columbus, OH 1964 Bulk Warehouse 17.00 300,200 100%
--------- ---
SUBTOTAL OR AVERAGE 1,421,016 93%
--------- ---
DALLAS/FORT WORTH
1275-1281 Roundtable Drive Dallas, TX 1966 Light Industrial 1.75 30,642 100%
2406-2416 Walnut Ridge Dallas, TX 1978 Light Industrial 1.76 44,000 100%
12750 Perimeter Drive Dallas, TX 1979 Bulk Warehouse 6.72 178,200 72%
1324-1343 Roundtable Drive Dallas, TX 1972 Light Industrial 2.09 47,000 100%
2401-2419 Walnut Ridge Dallas, TX 1978 Light Industrial 1.20 30,000 100%
4248-4252 Simonton Farmers Ranch, TX 1973 Bulk Warehouse 8.18 205,693 100%
900-906 Great Southwest Pkwy Arlington, TX 1972 Light Industrial 3.20 69,761 100%
2179 Shiloh Road Garland, TX 1982 Reg. Warehouse 3.63 65,700 34%
2159 Shiloh Road Garland, TX 1982 R&D/Flex 1.15 20,800 100%
2701 Shiloh Road Garland, TX 1981 Bulk Warehouse 8.20 214,650 55%
12784 Perimeter Drive (h) Dallas, TX 1981 Light Industrial 4.57 95,671 82%
3000 West Commerce Dallas, TX 1980 Manufacturing 11.23 128,478 100%
3030 Hansboro Dallas, TX 1971 Bulk Warehouse 3.71 100,000 100%
5222 Cockrell Hill Dallas, TX 1973 Manufacturing 4.79 96,506 100%
405-407 113th Arlington, TX 1969 Light Industrial 2.75 60,000 100%
816 111th Street Arlington, TX 1972 Light Industrial 2.89 65,000 100%
1017-25 Jacksboro Highway Fort Worth, TX 1970 Light Industrial 1.49 30,000 100%
7341 Dogwood Park Richland Hills, TX 1973 Light Industrial 1.09 20,045 100%
7427 Dogwood Park Richland Hills, TX 1973 Light Industrial 1.60 27,500 100%
7348-54 Tower Street Richland Hills, TX 1978 Light Industrial 1.09 20,107 100%
7370 Dogwood Park Richland Hills, TX 1987 Light Industrial 1.18 18,500 100%
7339-41 Tower Street Richland Hills, TX 1980 Light Industrial 0.95 17,600 100%
7437-45 Tower Street Richland Hills, TX 1977 Light Industrial 1.16 20,400 100%
7331-59 Airport Freeway Richland Hills, TX 1987 R&D/Flex 2.63 37,604 92%
7338-60 Dogwood Park Richland Hills, TX 1978 R&D/Flex 1.51 26,407 100%
7450-70 Dogwood Park Richland Hills, TX 1985 Light Industrial 0.88 18,004 100%
7423-49 Airport Freeway Richland Hills, TX 1985 R&D/Flex 2.39 33,388 100%
7400 Whitehall Street Richland Hills, TX 1994 Light Industrial 1.07 22,867 100%
1602-1654 Terre Colony Dallas, TX 1981 Bulk Warehouse 5.72 130,949 83%
3330 Duncanville Road Dallas, TX 1987 Reg. Warehouse 2.20 50,560 100%
6851-6909 Snowden Road Fort Worth, TX 1985/86 Bulk Warehouse 13.00 281,200 100%
2351-2355 Merritt Drive Garland, TX 1986 R&D/Flex 5.00 16,740 100%
10575 Vista Park Dallas, TX 1988 Reg. Warehouse 2.10 37,252 100%
701-735 North Plano Road Richardson, TX 1972/94 Bulk Warehouse 5.78 100,065 100%
2259 Merritt Drive Garland, TX 1986 R&D/Flex 1.90 16,740 100%
2260 Merritt Drive Garland, TX 1986/99 Reg. Warehouse 3.70 62,847 100%
2220 Merritt Drive Garland, TX 1986/2000 Reg. Warehouse 3.90 70,390 100%
2010 Merritt Drive Garland, TX 1986 Reg. Warehouse 2.80 57,392 100%
2363 Merritt Drive Garland, TX 1986 R&D/Flex 0.40 12,300 100%
2447 Merritt Drive Garland, TX 1986 R&D/Flex 0.40 12,300 100%
2465-2475 Merritt Drive Garland, TX 1986 R&D/Flex 0.50 16,740 100%
2485-2505 Merritt Drive Garland, TX 1986 Bulk Warehouse 5.70 108,550 100%
17919 Waterview Parkway Dallas, TX 1987 Reg. Warehouse 4.88 70,936 100%
2081 Hutton Drive-Bldg 1(h) Carrolton, TX 1981 R&D/Flex 3.73 42,170 89%
2150 Hutton Drive Carrolton, TX 1980 Light Industrial 2.50 48,325 100%
2110 Hutton Drive Carrolton, TX 1985 R&D/Flex 5.83 59,528 100%
2025 McKenzie Drive Carrolton, TX 1985 Reg. Warehouse 3.81 73,556 100%
2019 McKenzie Drive Carrolton, TX 1985 Reg. Warehouse 3.93 80,780 30%
1420 Valwood-Bldg 1 (g) Carrolton, TX 1986 R&D/Flex 3.30 40,884 82%
1620 Valwood-Bldg 1 (h) Carrolton, TX 1986 Light Industrial 6.59 103,475 84%
1505 Luna Road-Bldg II Carrolton, TX 1988 Light Industrial 1.00 16,800 100%
1625 West Crosby Road Carrolton, TX 1988 Light Industrial 4.72 87,687 54%
2029-2035 McKenzie Drive Carrolton, TX 1985 Reg. Warehouse 3.30 81,924 73%
1840 Hutton Drive (g) Carrolton, TX 1986 R&D/Flex 5.83 93,132 90%
1420 Valwood-Bldg II Carrolton, TX 1986 Light Industrial 3.32 55,625 84%
2015 McKenzie Drive Carrolton, TX 1986 Light Industrial 3.38 73,187 62%
2009 McKenzie Drive Carrolton, TX 1987 Light Industrial 3.03 66,112 74%
1505 Luna Road-Bldg I Carrolton, TX 1988 Light Industrial 2.97 49,791 96%
1505 Luna Road-Bldg III Carrolton, TX 1988 Light Industrial 3.64 58,989 100%
900-1100 Avenue S Grand Prairie, TX 1985 Bulk Warehouse 5.50 122,881 100%
15001 Trinity Blvd Fort Worth, TX 1984 Light Industrial 4.70 83,473 100%
Plano Crossing (i) Plano, TX 1998 Light Industrial 13.66 215,672 100%
7413A-C Dogwood Park Richland Hills, TX 1990 Light Industrial 1.23 22,500 100%
7450 Tower Street Richland Hills, TX 1977 R&D/Flex 0.68 10,000 100%
7436 Tower Street Richland Hills, TX 1979 Light Industrial 0.89 15,000 100%
7501 Airport Freeway Richland Hills, TX 1983 Light Industrial 2.04 15,000 100%
7426 Tower Street Richland Hills, TX 1978 Light Industrial 1.06 19,780 100%
7427-7429 Tower Street Richland Hills, TX 1981 Light Industrial 1.02 20,000 100%
</Table>
19
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
DALLAS/FORT WORTH, (CONT.)
2840-2842 Handley
Ederville Rd Richland Hills, TX 1977 R&D/Flex 1.25 20,260 100%
7451-7477 Airport Freeway Richland Hills, TX 1984 R&D/Flex 2.30 33,547 100%
7415 Whitehall Street Richland Hills, TX 1986 Light Industrial 3.95 61,260 100%
7450 Whitehall Street Richland Hills, TX 1978 Light Industrial 1.17 25,000 100%
7430 Whitehall Street Richland Hills, TX 1985 Light Industrial 1.06 24,600 100%
7420 Whitehall Street Richland Hills, TX 1985 Light Industrial 1.06 20,300 100%
300 Wesley Way Richland Hills, TX 1995 Reg. Warehouse 2.59 41,340 100%
2104 Hutton Drive Carrolton, TX 1990 Light Industrial 1.70 24,800 100%
Addison Tech Ctr - Bldg B Addison, TX 2001 Reg. Warehouse 8.17 102,400 85%
7337 Dogwood Park Richland Hills, TX 1975 Light Industrial 1.14 20,000 100%
7334 Tower Street Richland Hills, TX 1975 Light Industrial 0.97 20,000 100%
7451 Dogwood Park Richland Hills, TX 1977 Light Industrial 1.85 39,674 100%
7440 Whitehall Street Richland Hills, TX 1983 Light Industrial 1.40 24,222 0%
2821 Cullen Street Fort Worth, TX 1961 Light Industrial 0.84 17,877 100%
--------- ---
SUBTOTAL OR AVERAGE 4,821,035 90%
--------- ---
DAYTON
6094-6104 Executive
Boulevard Huber Heights, OH 1975 Light Industrial 3.33 43,200 97%
6202-6220 Executive
Boulevard Huber Heights, OH 1996 Light Industrial 3.79 64,000 70%
6268-6294 Executive
Boulevard Huber Heights, OH 1989 Light Industrial 4.03 60,800 95%
5749-5753 Executive
Boulevard Huber Heights, OH 1975 Light Industrial 1.15 12,000 100%
6230-6266 Executive
Boulevard Huber Heights, OH 1979 Light Industrial 5.30 84,000 100%
2200-2224 Sandridge Road Moraine, OH 1983 Light Industrial 2.96 58,746 100%
8119-8137 Uehling Lane Dayton, OH 1978 R&D/Flex 1.15 20,000 60%
--------- ---
SUBTOTAL OR AVERAGE 342,746 91%
--------- ---
DENVER
7100 North Broadway -
Bldg. 1 Denver, CO 1978 Light Industrial 16.80 32,298 81%
7100 North Broadway -
Bldg. 2 Denver, CO 1978 Light Industrial 16.90 32,500 86%
7100 North Broadway -
Bldg. 3 Denver, CO 1978 Light Industrial 11.60 22,259 94%
7100 North Broadway -
Bldg. 5 Denver, CO 1978 Light Industrial 15.00 28,789 87%
7100 North Broadway -
Bldg. 6 Denver, CO 1978 Light Industrial 22.50 38,255 54%
20100 East 32nd Avenue
Parkway Aurora, CO 1997 R&D/Flex 4.10 51,300 39%
15700-15820 West 6th Avenue Golden, CO 1978 Light Industrial 1.92 52,767 84%
15850-15884 West 6th Avenue Golden, CO 1978 Light Industrial 1.92 31,856 83%
5454 Washington Denver, CO 1985 Light Industrial 4.00 34,740 82%
700 West 48th Street Denver, CO 1984 Light Industrial 5.40 53,431 50%
702 West 48th Street Denver, CO 1984 Light Industrial 5.40 23,820 80%
6425 North Washington Denver, CO 1983 R&D/Flex 4.05 81,120 91%
3370 North Peoria Street Aurora, CO 1978 R&D/Flex 1.64 25,538 100%
3390 North Peoria Street Aurora, CO 1978 R&D/Flex 1.46 22,699 82%
3508-3538 North Peoria
Street Aurora, CO 1978 R&D/Flex 2.61 40,653 81%
3568 North Peoria Street Aurora, CO 1978 R&D/Flex 2.24 34,937 61%
4785 Elati Denver, CO 1972 Light Industrial 3.34 34,777 45%
4770 Fox Street Denver, CO 1972 Light Industrial 3.38 26,565 100%
1550 West Evans Denver, CO 1975 Light Industrial 3.92 78,787 91%
3751 - 71 Revere Street Denver, CO 1980 Reg. Warehouse 2.41 55,027 100%
3871 Revere Street Denver, CO 1980 Reg. Warehouse 3.19 75,265 100%
5454 Havana Street Denver, CO 1980 R&D/Flex 2.68 42,504 100%
5500 Havana Street Denver, CO 1980 R&D/Flex 2.19 34,776 100%
4570 Ivy Street Denver, CO 1985 Light Industrial 1.77 31,355 100%
5855 Stapleton Drive North Denver, CO 1985 Light Industrial 2.33 41,268 75%
5885 Stapleton Drive North Denver, CO 1985 Light Industrial 3.05 53,893 100%
5200-5280 North Broadway Denver, CO 1977 Light Industrial 1.54 31,780 100%
5977-5995 North Broadway Denver, CO 1978 Light Industrial 4.96 50,280 100%
2952-5978 North Broadway Denver, CO 1978 Light Industrial 7.91 88,977 100%
6400 North Broadway Denver, CO 1982 Light Industrial 4.51 69,430 100%
875 Parfet Street Lakewood, CO 1975 Light Industrial 3.06 49,216 100%
4721 Ironton Street Denver, CO 1969 R&D/Flex 2.84 51,260 100%
833 Parfet Street Lakewood, CO 1974 R&D/Flex 2.57 24,800 62%
11005 West 8th Avenue Lakewood, CO 1974 Light Industrial 2.57 25,672 100%
7100 North Broadway - 7 Denver, CO 1985 R&D/Flex 2.30 24,822 97%
7100 North Broadway - 8 Denver, CO 1985 R&D/Flex 2.30 9,107 100%
6804 East 48th Avenue Denver, CO 1973 R&D/Flex 2.23 46,464 88%
445 Bryant Street Denver, CO 1960 Light Industrial 6.31 292,471 100%
East 47th Drive -A Denver, CO 1997 R&D/Flex 3.00 51,210 84%
9500 W. 49th Street - A Wheatridge, CO 1997 Light Industrial 1.74 19,217 100%
9500 W. 49th Street - B Wheatridge, CO 1997 Light Industrial 1.74 16,441 100%
9500 W. 49th Street - C Wheatridge, CO 1997 R&D/Flex 1.74 29,174 59%
9500 W. 49th Street - D Wheatridge, CO 1997 Light Industrial 1.74 41,615 89%
8100 South Park Way - A Littleton, CO 1997 R&D/Flex 3.33 52,581 100%
8100 South Park Way - B Littleton, CO 1984 R&D/Flex 0.78 12,204 100%
8100 South Park Way - C Littleton, CO 1984 Light Industrial 4.28 67,520 100%
451-591 East 124th Avenue Littleton, CO 1979 Light Industrial 4.96 59,711 100%
</Table>
20
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
DENVER (CONT.)
608 Garrison Street Lakewood, CO 1984 R&D/Flex 2.17 25,075 85%
610 Garrison Street Lakewood, CO 1984 R&D/Flex 2.17 24,965 79%
1111 West Evans (A&C) Denver, CO 1986 Light Industrial 2.00 36,894 100%
1111 West Evans (B) Denver, CO 1986 Light Industrial 0.50 4,725 100%
15000 West 6th Avenue Golden, CO 1985 R&D/Flex 5.25 69,279 75%
14998 West 6th Avenue
Building E Golden, CO 1995 R&D/Flex 2.29 42,832 79%
14998 West 6th Avenue
Building F Englewood, CO 1995 R&D/Flex 2.29 20,424 100%
12503 East Euclid Drive Denver, CO 1986 R&D/Flex 10.90 97,871 81%
6547 South Racine Circle Englewood, CO 1996 Light Industrial 3.92 59,918 89%
7800 East Iliff Avenue Denver, CO 1983 R&D/Flex 3.06 22,296 100%
2369 South Trenton Way Denver, CO 1983 R&D/Flex 4.80 33,108 85%
2422 South Trenton Way Denver, CO 1983 R&D/Flex 3.94 27,413 34%
2452 South Trenton Way Denver, CO 1983 R&D/Flex 6.78 47,931 79%
651 Topeka Way Denver, CO 1985 R&D/Flex 4.53 24,000 88%
680 Atchinson Way Denver, CO 1985 R&D/Flex 4.53 24,000 100%
8122 South Park Lane - A Littleton, CO 1986 R&D/Flex 5.09 43,987 98%
1600 South Abilene Aurora, CO 1986 R&D/Flex 3.53 47,930 100%
1620 South Abilene Aurora, CO 1986 Light Industrial 2.04 27,666 83%
1640 South Abilene Aurora, CO 1986 Light Industrial 2.80 37,948 100%
13900 East Florida Avenue Aurora, CO 1986 R&D/Flex 1.44 19,493 100%
4301 South Federal Boulevard Englewood, CO 1997 Reg. Warehouse 2.80 35,403 83%
14401-14492 East 33rd Place Aurora, CO 1979 Bulk Warehouse 4.75 100,100 100%
11701 East 53rd Avenue Denver, CO 1985 Reg. Warehouse 4.19 81,981 100%
5401 Oswego Street Denver, CO 1985 Reg. Warehouse 2.80 54,738 100%
3811 Joliet Denver, CO 1977 R&D/Flex 14.24 124,290 100%
2630 West 2nd Avenue Denver, CO 1970 Light Industrial 0.50 8,260 100%
2650 West 2nd Avenue Denver, CO 1970 Light Industrial 2.80 36,081 100%
14818 West 6th Avenue
Bldg. A Golden, CO 1985 R&D/Flex 2.54 39,776 83%
14828 West 6th Avenue
Bldg. B Golden, CO 1985 R&D/Flex 2.54 41,805 70%
12055 E. 49th Ave/4955
Peoria Denver, CO 1984 R&D/Flex 3.09 49,575 94%
4940-4950 Paris Denver, CO 1984 R&D/Flex 1.58 25,290 50%
4970 Paris Denver, CO 1984 R&D/Flex 0.98 15,767 100%
5010 Paris Denver, CO 1984 R&D/Flex 0.92 14,822 100%
7367 South Revere Parkway Englewood, CO 1997 Bulk Warehouse 8.50 102,839 86%
10311 W. Hampden Avenue Lakewood, CO 1999 Light Industrial 4.40 52,227 100%
8200 E. Park Meadows
Drive(g) Lone Tree, CO 1984 R&D Flex 6.60 90,219 81%
3250 Quentin(g) Aurora, CO 1984/2000 Light Industrial 8.90 144,464 91%
11585 E. 53rd Ave.(g) Denver, CO 1984 Bulk Warehouse 15.10 335,967 100%
10500 East 54th Ave.(h) Denver, CO 1986 Light Industrial 9.12 178,135 84%
--------- ---
SUBTOTAL OR AVERAGE 4,464,625 90%
--------- ---
DES MOINES
2250 Delaware Ave. Des Moines, IA 1975 Reg. Warehouse 4.20 88,000 90%
--------- ---
SUBTOTAL OR AVERAGE 88,000 90%
--------- ---
DETROIT
2654 Elliott Troy, MI (a) 1986 R&D/Flex 0.75 9,700 100%
1731 Thorncroft Troy, MI (a) 1969 Light Industrial 2.26 38,000 100%
1653 E. Maple Troy, MI (a) 1990 R&D/Flex 1.38 23,392 100%
47461 Clipper Plymouth, MI (a) 1992 Light Industrial 1.10 11,600 100%
47522 Galleon Plymouth, MI (a) 1990 Light Industrial 0.90 13,507 100%
238 Executive Drive Troy, MI 1973 Light Industrial 1.32 13,740 100%
256 Executive Drive Troy, MI 1974 Light Industrial 1.12 11,273 100%
301 Executive Drive Troy, MI 1974 Light Industrial 1.27 20,411 100%
449 Executive Drive Troy, MI 1975 Reg. Warehouse 2.12 33,001 100%
501 Executive Drive Troy, MI 1984 Light Industrial 1.57 18,061 100%
451 Robbins Drive Troy, MI 1975 Light Industrial 1.88 28,401 100%
1035 Crooks Road Troy, MI 1980 Light Industrial 1.74 23,320 100%
1095 Crooks Road Troy, MI 1986 R&D/Flex 2.83 35,042 100%
1416 Meijer Drive Troy, MI 1980 Light Industrial 1.20 17,944 100%
1624 Meijer Drive Troy, MI 1984 Light Industrial 3.42 44,040 100%
1972 Meijer Drive Troy, MI 1985 Reg. Warehouse 2.36 37,075 100%
1621 Northwood Drive Troy, MI 1977 Bulk Warehouse 1.54 24,900 100%
1707 Northwood Drive Troy, MI 1983 Light Industrial 1.69 28,750 100%
1788 Northwood Drive Troy, MI 1977 Light Industrial 1.55 12,480 0%
1821 Northwood Drive Troy, MI 1977 Reg. Warehouse 2.07 35,050 100%
1826 Northwood Drive Troy, MI 1977 Light Industrial 1.22 12,480 100%
1864 Northwood Drive Troy, MI 1977 Light Industrial 1.55 12,480 100%
1921 Northwood Drive Troy, MI 1977 Light Industrial 2.33 42,000 100%
2277 Elliott Avenue Troy, MI 1975 Light Industrial 0.96 12,612 100%
2451 Elliott Avenue Troy, MI 1974 Light Industrial 1.68 24,331 100%
2730 Research Drive Rochester
Hills, MI 1988 Reg. Warehouse 3.52 57,850 100%
2791 Research Drive Rochester
Hills, MI 1991 Reg. Warehouse 4.48 64,199 100%
2871 Research Drive Rochester
Hills, MI 1991 Reg. Warehouse 3.55 49,543 100%
</Table>
21
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
DETROIT (CONT.)
2911 Research Drive Rochester Hills, MI 1992 Reg. Warehouse 5.72 80,078 100%
3011 Research Drive Rochester Hills, MI 1988 Reg. Warehouse 2.55 32,637 100%
2870 Technology Drive Rochester Hills, MI 1988 Light Industrial 2.41 24,445 100%
2900 Technology Drive Rochester Hills, MI 1992 Reg. Warehouse 2.15 31,047 100%
2920 Technology Drive Rochester Hills, MI 1992 Light Industrial 1.48 19,011 100%
2930 Technology Drive Rochester Hills, MI 1991 Light Industrial 1.41 17,994 100%
2950 Technology Drive Rochester Hills, MI 1991 Light Industrial 1.48 19,996 100%
23014 Commerce Drive Farmington Hills, MI 1983 R&D/Flex 0.65 7,200 100%
23028 Commerce Drive Farmington Hills, MI 1983 Light Industrial 1.26 20,265 100%
23035 Commerce Drive Farmington Hills, MI 1983 Light Industrial 1.23 15,200 100%
23042 Commerce Drive Farmington Hills, MI 1983 R&D/Flex 0.75 8,790 100%
23065 Commerce Drive Farmington Hill, MI 1983 Light Industrial 0.91 12,705 100%
23070 Commerce Drive Farmington Hills, MI 1983 R&D/Flex 1.43 16,765 100%
23079 Commerce Drive Farmington Hills, MI 1983 Light Industrial 0.85 10,830 100%
23093 Commerce Drive Farmington Hills, MI 1983 Reg. Warehouse 3.87 49,040 100%
23135 Commerce Drive Farmington Hills, MI 1986 Light Industrial 2.02 23,969 100%
23163 Commerce Drive Farmington Hills, MI 1986 Light Industrial 1.51 19,020 100%
23177 Commerce Drive Farmington Hills, MI 1986 Light Industrial 2.29 32,127 100%
23206 Commerce Drive Farmington Hills, MI 1985 Light Industrial 1.30 19,822 100%
23290 Commerce Drive Farmington Hills, MI 1980 Reg. Warehouse 2.56 42,930 100%
23370 Commerce Drive Farmington Hills, MI 1980 Light Industrial 0.67 8,741 100%
1451 East Lincoln Avenue Madison Heights, MI 1967 Light Industrial 3.92 75,000 100%
4400 Purks Drive Auburn Hills, MI 1987 Light Industrial 13.04 157,100 100%
4177A Varsity Drive Ann Arbor, MI 1993 Light Industrial 2.48 11,050 100%
6515 Cobb Drive Sterling Heights, MI 1984 Light Industrial 2.91 47,597 100%
32450 N. Avis Drive Madison Heights, MI 1974 Light Industrial 3.23 55,820 100%
11866 Hubbard Livonia, MI 1979 Light Industrial 2.32 41,380 0%
12050-12300 Hubbard(g) Livonia, MI 1981 Light Industrial 6.10 85,086 77%
38300 Plymouth Livonia, MI 1997 Bulk Warehouse 6.95 127,800 100%
12707 Eckles Road Plymouth, MI 1990 Light Industrial 2.62 42,300 100%
9300-9328 Harrison Rd. Romulus, MI 1978 Light Industrial 2.53 29,286 38%
9330-9358 Harrison Rd. Romulus, MI 1978 Light Industrial 2.53 29,280 63%
28420-28448 Highland Rd Romulus, MI 1979 Light Industrial 2.53 29,280 0%
28450-28478 Highland Rd Romulus, MI 1979 Light Industrial 2.53 29,340 100%
28421-28449 Highland Rd Romulus, MI 1980 Light Industrial 2.53 29,285 63%
28451-28479 Highland Rd Romulus, MI 1980 Light Industrial 2.53 29,280 50%
28825-28909 Highland Rd Romulus, MI 1981 Light Industrial 2.53 29,284 56%
28933-29017 Highland Rd Romulus, MI 1982 Light Industrial 2.53 29,280 88%
28824-28908 Highland Rd Romulus, MI 1982 Light Industrial 2.53 29,280 100%
28932-29016 Highland Rd Romulus, MI 1982 Light Industrial 2.53 29,280 75%
9710-9734 Harrison Road Romulus, MI 1987 Light Industrial 2.22 25,925 100%
9740-9772 Harrison Road Romulus, MI 1987 Light Industrial 2.53 29,548 100%
9840-9868 Harrison Road Romulus, MI 1987 Light Industrial 2.53 29,280 100%
9800-9824 Harrison Road Romulus, MI 1987 Light Industrial 2.22 25,620 100%
29265-29285 Airport Drive Romulus, MI 1983 Light Industrial 2.05 23,707 100%
29185-29225 Airport Drive Romulus, MI 1983 Light Industrial 3.17 36,658 100%
29149-29165 Airport Drive Romulus, MI 1984 Light Industrial 2.89 33,440 100%
29101-29115 Airport Drive Romulus, MI 1985 R&D/Flex 2.53 29,287 100%
29031-29045 Airport Drive Romulus, MI 1985 Light Industrial 2.53 29,280 100%
29050-29062 Airport Drive Romulus, MI 1986 Light Industrial 2.22 25,837 44%
29120-29134 Airport Drive Romulus, MI 1986 Light Industrial 2.53 29,282 75%
29200-29214 Airport Drive Romulus, MI 1985 Light Industrial 2.53 29,282 100%
9301-9339 Middlebelt Road Romulus, MI 1983 R&D/Flex 1.29 15,173 100%
26980 Trolley Industrial
Drive Taylor, MI 1997 Bulk Warehouse 5.43 102,400 100%
33200 Capitol Avenue Livonia, MI 1977 Light Industrial 2.16 40,000 100%
32975 Capitol Avenue Livonia, MI 1978 R&D/Flex 0.99 18,465 100%
2725 S. Industrial Highway Ann Arbor, MI 1997 Light Industrial 2.63 37,875 23%
32920 Capitol Avenue Livonia, MI 1973 Reg. Warehouse 0.47 8,000 100%
11862 Brookfield Avenue Livonia, MI 1972 Light Industrial 0.92 14,600 100%
11923 Brookfield Avenue Livonia, MI 1973 Light Industrial 0.76 14,600 100%
11965 Brookfield Avenue Livonia, MI 1973 Light Industrial 0.88 14,600 100%
34005 Schoolcraft Road Livonia, MI 1981 Light Industrial 1.70 26,100 100%
13405 Stark Road Livonia, MI 1980 Light Industrial 0.65 9,750 100%
1170 Chicago Road Troy, MI 1983 Light Industrial 1.73 21,500 100%
1200 Chicago Road Troy, MI 1984 Light Industrial 1.73 26,210 100%
450 Robbins Drive Troy, MI 1976 Light Industrial 1.38 19,050 100%
1230 Chicago Road Troy, MI 1996 Reg. Warehouse 2.10 30,120 100%
12886 Westmore Avenue Livonia, MI 1981 Light Industrial 1.01 18,000 100%
12898 Westmore Avenue Livonia, MI 1981 Light Industrial 1.01 18,000 100%
33025 Industrial Road Livonia, MI 1980 Light Industrial 1.02 6,250 100%
47711 Clipper Street Plymouth Twsp, MI 1996 Reg. Warehouse 2.27 36,926 100%
32975 Industrial Road Livonia, MI 1984 Light Industrial 1.19 21,000 100%
</Table>
22
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
DETROIT (CONT.)
32985 Industrial Road Livonia, MI 1985 Light Industrial 0.85 12,040 100%
32995 Industrial Road Livonia, MI 1983 Light Industrial 1.11 14,280 100%
12874 Westmore Avenue Livonia, MI 1984 Light Industrial 1.01 16,000 100%
33067 Industrial Road Livonia, MI 1984 Light Industrial 1.11 18,640 100%
1775 Bellingham Troy, MI 1987 R&D/Flex 1.88 28,900 100%
1785 East Maple Troy, MI 1985 Light Industrial 0.80 10,200 100%
1807 East Maple Troy, MI 1984 R&D/Flex 2.15 28,100 100%
980 Chicago Road Troy, MI 1985 Light Industrial 1.09 14,280 100%
1840 Enterprise Drive Rochester Hills, MI 1990 R&D/Flex 2.42 33,240 42%
1885 Enterprise Drive Rochester Hills, MI 1990 Light Industrial 1.47 19,604 100%
1935-55 Enterprise Drive Rochester Hills, MI 1990 R&D/Flex 4.54 53,400 100%
5500 Enterprise Court Warren, MI 1989 R&D/Flex 3.93 53,900 100%
750 Chicago Road Troy, MI 1986 Light Industrial 1.54 26,709 0%
800 Chicago Road Troy, MI 1985 Light Industrial 1.48 24,340 100%
850 Chicago Road Troy, MI 1984 Light Industrial 0.97 16,049 100%
2805 S. Industrial Highway Ann Arbor, MI 1990 R&D/Flex 1.70 24,458 90%
6833 Center Drive Sterling
Heights, MI 1998 Reg. Warehouse 4.42 66,132 100%
32201 North Avis Drive Madison Heights, MI 1974 R&D/Flex 4.19 50,000 100%
1100 East Mandoline Road Madison Heights, MI 1967 Bulk Warehouse 8.19 117,903 0%
30081 Stephenson Highway Madison Heights, MI 1967 Light Industrial 2.50 50,750 100%
1120 John A. Papalas
Drive(h) Lincoln Park, MI 1985 Light Industrial 10.30 120,410 100%
4872 S. Lapeer Road Lake Orion Twsp, MI 1999 Bulk Warehouse 9.58 125,605 100%
775 James L. Hart Parkway Ypsilanti, MI 1999 Reg. Warehouse 7.65 55,535 100%
22701 Trolley Industrial Taylor, MI 1999 Bulk Warehouse 9.12 160,035 100%
1400 Allen Drive Troy, MI 1979 Reg. Warehouse 1.98 27,280 100%
1408 Allen Drive Troy, MI 1979 Light Industrial 1.44 19,704 100%
1305 Stephenson Hwy Troy, MI 1979 Reg. Warehouse 3.42 47,000 100%
32505 Industrial Drive Madison Heights, MI 1979 Light Industrial 3.07 47,013 100%
1799-1813 Northfield
Drive(g) Rochester Hills, MI 1980 Light Industrial 4.22 67,360 100%
--------- ---
SUBTOTAL OR AVERAGE 4,398,434 91%
--------- ---
GRAND RAPIDS
5050 Kendrick Court SE Grand Rapids, MI 1988 Manufacturing 26.94 413,500 100%
5015 52nd Street SE Grand Rapids, MI 1987 Light Industrial 4.50 61,250 100%
--------- ---
SUBTOTAL OR AVERAGE 474,750 100%
--------- ---
HOUSTON
2102-2314 Edwards Street Houston, TX 1961 Bulk Warehouse 5.02 115,248 100%
4545 Eastpark Drive Houston, TX 1972 Reg. Warehouse 3.80 81,295 100%
3351 Rauch Street Houston, TX 1970 Reg. Warehouse 4.04 82,500 100%
3851 Yale Street Houston, TX 1971 Bulk Warehouse 5.77 132,554 13%
3337-3347 Rauch Street Houston, TX 1970 Reg. Warehouse 2.29 53,425 74%
8505 North Loop East Houston, TX 1981 Bulk Warehouse 4.99 107,769 100%
4749-4799 Eastpark Dr. Houston, TX 1979 Bulk Warehouse 7.75 182,563 79%
4851 Homestead Road Houston, TX 1973 Bulk Warehouse 3.63 142,250 100%
3365-3385 Rauch Street Houston, TX 1970 Reg. Warehouse 3.31 82,140 83%
5050 Campbell Road Houston, TX 1970 Bulk Warehouse 6.10 121,875 100%
4300 Pine Timbers Houston, TX 1980 Bulk Warehouse 4.76 113,400 58%
7901 Blankenship Houston, TX 1972 Light Industrial 2.17 48,000 100%
2500-2530 Fairway Park Houston, TX 1974 Bulk Warehouse 8.72 213,638 100%
6550 Longpointe Houston, TX 1980 Bulk Warehouse 4.13 97,700 100%
1815 Turning Basin Drive Houston, TX 1980 Bulk Warehouse 6.34 139,630 100%
1819 Turning Basin Drive Houston, TX 1980 Light Industrial 2.85 65,494 100%
1805 Turning Basin Drive Houston, TX 1980 Bulk Warehouse 7.60 155,250 100%
7000 Empire Drive Houston, TX 1980 R&D/Flex 6.25 95,073 75%
9777 West Gulfbank Drive Houston, TX 1980 Light Industrial 15.45 74%
252,242
9835 A Genard Road Houston, TX 1980 Bulk Warehouse 39.20 417,350 100%
9835 B Genard Road Houston, TX 1980 Reg. Warehouse 6.40 66,600 100%
10161 Harwin Drive Houston, TX 1979/1981 R & D/Flex 5.27 73,052 75%
10165 Harwin Drive Houston, TX 1979/1981 R & D/Flex 2.31 31,987 100%
10175 Harwin Drive Houston, TX 1797/1981 Light Industrial 2.85 39,475 95%
10325-10415 Landsbury Dr(h) Houston, TX 1982 Light Industrial 265.00 131,000 100%
--------- ---
SUBTOTAL OR AVERAGE 3,041,510 89%
--------- ---
INDIANAPOLIS
2900 North Shadeland Indianapolis, IN 1957/1992 Bulk Warehouse 60.00 933,439 99%
2400 North Shadeland Indianapolis, IN 1970 Reg. Warehouse 2.45 40,000 100%
2402 North Shadeland Indianapolis, IN 1970 Bulk Warehouse 7.55 121,539 100%
7901 West 21st Street Indianapolis, IN 1985 Bulk Warehouse 12.00 353,000 84%
1445 Brookville Way Indianapolis, IN 1989 Bulk Warehouse 8.79 115,200 91%
1440 Brookville Way Indianapolis, IN 1990 Bulk Warehouse 9.64 166,400 100%
1240 Brookville Way Indianapolis, IN 1990 Light Industrial 3.50 63,000 50%
1220 Brookville Way Indianapolis, IN 1990 R&D/Flex 2.10 10,000 100%
1345 Brookville Way Indianapolis, IN (c) 1992 Bulk Warehouse 5.50 130,736 89%
1350 Brookville Way Indianapolis, IN 1994 Reg. Warehouse 2.87 38,460 37%
</Table>
23
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
INDIANAPOLIS (CONT.)
1341 Sadlier Circle East
Drive Indianapolis, IN (c) 1971/1992 Light Industrial 2.03 32,400 75%
1322-1438 Sadlier Circle Indianapolis, IN (c) 1971/1992 Light Industrial 3.79 36,000 93%
East Dr
1327-1441 Sadlier Circle Indianapolis, IN (c) 1992 Light Industrial 5.50 54,000 93%
East Dr
1304 Sadlier Circle East Indianapolis, IN (c) 1971/1992 Reg. Warehouse 2.42 17,600 100%
Drive
1402 Sadlier Circle East Indianapolis, IN (c) 1970/1992 Light Industrial 4.13 40,800 62%
Drive
1504 Sadlier Circle East Indianapolis, IN (c) 1971/1992 Manufacturing 4.14 54,000 100%
Drive
1311 Sadlier Circle East Indianapolis, IN (c) 1971/1992 R&D/Flex 1.78 13,200 100%
Drive
1365 Sadlier Circle East Indianapolis, IN (c) 1971/1992 Light Industrial 2.16 30,000 100%
Drive
1352-1354 Sadlier Circle E. Indianapolis, IN (c) 1970/1992 Light Industrial 3.50 44,000 100%
Drive
1335 Sadlier Circle East Indianapolis, IN (c) 1971/1992 R&D/Flex 1.20 20,000 100%
Drive
1327 Sadlier Circle East Indianapolis, IN (c) 1971/1992 Reg. Warehouse 1.20 12,800 100%
Drive
1425 Sadlier Circle East Indianapolis, IN (c) 1971/1992 R&D/Flex 2.49 5,000 100%
Drive
1230 Brookville Way Indianapolis, IN 1995 Reg. Warehouse 1.96 15,000 100%
6951 East 30th Street Indianapolis, IN 1995 Light Industrial 3.81 44,000 100%
6701 East 30th Street Indianapolis, IN 1995 Light Industrial 3.00 7,820 100%
6737 East 30th Street Indianapolis, IN 1995 Reg. Warehouse 11.01 87,500 74%
1225 Brookville Way Indianapolis, IN 1997 Light Industrial 1.00 10,000 100%
6555 East 30th Street Indianapolis, IN 1969/1981 Bulk Warehouse 22.00 331,826 78%
2432-2436 Shadeland Indianapolis, IN 1968 Light Industrial 4.57 70,560 56%
8402-8440 East 33rd Street Indianapolis, IN 1977 Light Industrial 4.70 55,200 72%
8520-8630 East 33rd Street Indianapolis, IN 1976 Light Industrial 5.30 81,000 72%
8710-8768 East 33rd Street Indianapolis, IN 1979 Light Industrial 4.70 43,200 100%
3316-3346 North Pagosa Court Indianapolis, IN 1977 Light Industrial 5.10 81,000 58%
3331 Raton Court Indianapolis, IN 1979 Light Industrial 2.80 35,000 0%
4430 Airport Expressway Indianapolis, IN 1970 Bulk Warehouse 32.00 486,394 100%
6751 East 30th Street Indianapolis, IN 1997 Bulk Warehouse 6.34 100,000 66%
9200 East 146th Street Noblesville, IN 1961/1981 Bulk Warehouse 21.65 150,488 97%
9210 East 146th Street Noblesville, IN 1978 Reg. Warehouse 11.91 23,950 100%
6575 East 30th Street Indianapolis, IN 1998 Bulk Warehouse 4.00 60,000 100%
6585 East 30th Street Indianapolis, IN 1998 Bulk Warehouse 6.00 100,000 100%
9910 North by Northeast Fishers, IN 1994 Bulk Warehouse 8.40 192,000 100%
Blvd.
6041 Guion Road Indianapolis, IN 1968 Light Industrial 2.80 40,000 100%
--------- ---
SUBTOTAL OR AVERAGE 4,346,512 90%
--------- ---
LOS ANGELES
5220 Fourth Street Irwindale, CA 2000 Light Industrial 1.28 28,800 91%
15705 Arrow Highway Irwindale, CA 1987 Light Industrial 0.75 16,792 100%
15709 Arrow Highway Irwindale, CA 1987 Light Industrial 1.10 24,000 100%
6407-6419 Alondra Blvd. Paramount, CA 1985 Light Industrial 0.90 16,392 100%
6423-6431 Alondra Blvd. Paramount., CA 1985 Light Industrial 0.76 13,765 100%
15101-15141 Figueroa St. (g) Los Angeles, CA 1982 Reg. Warehouse 4.70 129,600 40%
20816-18 Higgins Court Torrance, CA 1981 Light Industrial 0.35 7,300 100%
21136 South Wilmington Ave. Carson, CA 1989 Bulk Warehouse 6.02 115,702 100%
19914 Via Baron Way Rancho Dominguez, CA (b) 1973 Bulk Warehouse 11.69 234,800 100%
2035 E. Vista Bella Way Rancho Dominguez, CA (d) 1972 Bulk Warehouse 14.15 230,000 100%
14912 Shoemaker Ave. Sante Fe
Springs, CA 1967 R&D/Flex 0.25 5,121 100%
14920 Shoemaker Ave. Sante Fe
Springs, CA 1967 R&D/Flex 0.23 4,600 100%
14928 Shoemaker Ave. Sante Fe
Springs, CA 1967 R&D/Flex 0.23 4,600 100%
14938 Shoemaker Ave. Sante Fe
Springs, CA 1967 R&D/Flex 0.23 4,600 100%
14944 Shoemaker Ave. Sante Fe
Springs, CA 1978 Light Industrial 1.99 40,015 94%
14946 Shoemaker Ave. Sante Fe
Springs, CA 1978 Light Industrial 1.68 33,769 81%
14948 Shoemaker Ave. Sante Fe
Springs, CA 1978 Light Industrial 0.61 12,300 100%
14141 Alondra Blvd. Sante Fe
Springs, CA 1969 Bulk Warehouse 23.90 396,095 100%
12616 Yukon Ave. Hawthorne, CA 1987 Reg. Warehouse 1.89 43,676 100%
3355 El Segundo Blvd. (h) Hawthorne, CA 1959 Light Industrial 2.79 56,353 100%
12621 Cerise Hawthorne, CA 1959 Light Industrial 1.11 27,000 100%
1830 W. 208th Street Torrance, CA 1981 Light Industrial 0.51 7,800 100%
20807-09 Higgins Court Torrance, CA 1981 Light Industrial 0.38 8,048 100%
20801-03 Higgins Court Torrance, CA 1981 Light Industrial 0.41 8,086 100%
20817-19 S. Western Ave. Torrance, CA 1981 Light Industrial 0.35 7,300 100%
20915-17 S. Western Ave. Torrance, CA 1981 Light Industrial 0.35 7,300 100%
20908-10 Higgins Court Torrance, CA 1981 Light Industrial 0.35 7,300 100%
20914-16 Higgins Court Torrance, CA 1981 Light Industrial 0.35 6,100 100%
12700-12712 Yukon Ave. (h) Hawthorne, CA 1960 R&D/Flex 4.13 68,672 68%
42374 Avenida Alvarado (h) Temecula, CA 1987 Reg. Warehouse 5.00 103,008 99%
--------- ---
SUBTOTAL OR AVERAGE 1,668,894 93%
--------- ---
LOUISVILLE
9001 Cane Run Road Louisville, KY 1998 Bulk Warehouse 39.60 212,500 76%
9101 Cane Road Louisville, KY 2000 Bulk Warehouse 14.00 231,000 100%
--------- ---
SUBTOTAL OR AVERAGE 443,500 89%
--------- ---
MILWAUKEE
N25 W23050 Paul Road Pewaukee, WI 1989 R&D/Flex 4.50 37,765 0%
N25 W23255 Paul Road Pewaukee, WI 1987 R&D/Flex 4.80 55,940 100%
</Table>
24
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
MILWAUKEE (CONT.)
N27 W23293 Roundy Drive Pewaukee, WI 1989 Reg. Warehouse 3.64 39,468 100%
6523 N. Sydney Place Glendale, WI 1978 Light Industrial 4.00 43,440 100%
8800 W. Bradley Milwaukee, WI 1982 Light Industrial 8.00 77,621 100%
4560 North 124th Street Wauwatosa, WI 1976 Light Industrial 1.31 25,000 100%
4410-80 North 132nd Street Butler, WI 1999 Bulk Warehouse 4.90 100,000 99%
--------- ---
SUBTOTAL OR AVERAGE 379,234 90%
--------- ---
MINNEAPOLIS/ST. PAUL
2700 Freeway Boulevard Brooklyn Center,
MN (a) 1981 Light Industrial 7.76 78,741 77%
6507-6545 Cecilia Circle Bloomington, MN 1980 Manufacturing 9.65 74,118 96%
1275 Corporate Center Drive Eagan, MN 1990 Light Industrial 1.50 19,675 100%
1279 Corporate Center Drive Eagan, MN 1990 Light Industrial 1.50 19,792 100%
6201 West 111th Street Bloomington, MN 1987 Bulk Warehouse 37.00 424,866 100%
6403-6545 Cecilia Drive Bloomington, MN 1980 Light Industrial 9.65 87,560 97%
6925-6943 Washington Avenue Edina, MN 1972 Manufacturing 2.75 37,625 100%
6955-6973 Washington Avenue Edina, MN 1972 Manufacturing 2.25 31,189 96%
7251-7267 Washington Avenue Edina, MN 1972 Light Industrial 1.82 26,250 70%
7301-7325 Washington Avenue Edina, MN 1972 Light Industrial 1.92 27,297 76%
7101 Winnetka Avenue North Brooklyn Park, MN 1990 Bulk Warehouse 14.18 252,978 69%
7600 Golden Triangle Drive Eden Prairie, MN 1989 R&D/Flex 6.79 74,148 100%
9901 West 74th Street Eden Prairie, MN 1983/88 Reg. Warehouse 8.86 153,813 100%
11201 Hampshire Avenue South Bloomington, MN 1986 Manufacturing 5.90 60,480 100%
12220-12222 Nicollet Avenue Burnsville, MN 1989/90 Light Industrial 1.80 17,116 100%
12250-12268 Nicollet Avenue Burnsville, MN 1989/90 Light Industrial 4.30 42,365 100%
12224-12226 Nicollet Avenue Burnsville, MN 1989/90 R&D/Flex 2.40 23,607 78%
980 Lone Oak Road Eagan, MN 1992 Reg. Warehouse 11.40 154,950 74%
990 Lone Oak Road Eagan, MN 1989 Reg. Warehouse 11.41 163,607 94%
1030 Lone Oak Road Eagan, MN 1988 Light Industrial 6.30 83,076 100%
1060 Lone Oak Road Eagan, MN 1988 Light Industrial 6.50 82,728 100%
5400 Nathan Lane Plymouth, MN 1990 Light Industrial 5.70 72,089 100%
6464 Sycamore Court Maple Grove, MN 1990 Manufacturing 6.40 79,702 100%
10120 W. 76th Street Eden Prairie, MN 1987 Light Industrial 4.52 59,030 100%
7615 Golden Triangle Eden Prairie, MN 1987 Light Industrial 4.61 52,816 100%
7625 Golden Triangle Drive Eden Prairie, MN 1987 Light Industrial 4.61 73,168 70%
2605 Fernbrook Lane North Plymouth, MN 1987 R&D/Flex 6.37 80,766 100%
12155 Nicollet Avenue Burnsville, MN 1995 Reg. Warehouse 5.80 48,000 100%
6655 Wedgewood Road Maple Grove, MN 1989 Manufacturing 17.88 123,815 100%
900 Apollo Road Egan, MN 1970 Manufacturing 39.00 312,265 100%
7316 Aspen Lane North Brooklyn Park, MN 1978 Manufacturing 6.63 96,000 67%
953 Westgate Drive Brooklyn Center,
MN 1991 Light Industrial 3.17 51,906 100%
73rd Avenue North Brooklyn Park, MN 1995 R&D/Flex 4.46 59,782 100%
1905 W. Country Road C Roseville, MN 1993 R&D/Flex 4.60 47,735 92%
2720 Arthur Street Roseville, MN 1995 R&D/Flex 6.06 74,337 100%
10205 51st Avenue North Plymouth, MN 1990 Reg. Warehouse 2.00 30,476 0%
4100 Peavey Road Chaska, MN 1988 Manufacturing 8.27 78,029 80%
11300 Hampshire Ave. South Bloomington, MN 1983 Bulk Warehouse 9.94 145,210 100%
375 Rivertown Drive Woodbury, MN 1996 Bulk Warehouse 11.33 251,968 100%
5205 Highway 169 Plymouth, MN 1960 Light Industrial 7.92 98,844 90%
6451-6595 Citywest Parkway Eden Prairie, MN 1984 R&D/Flex 6.98 82,769 83%
7500-7546 Washington Square Eden Prairie, MN 1975 Light Industrial 5.40 46,285 53%
7550-7558 Washington Square Eden Prairie, MN 1975 Light Industrial 2.70 29,739 100%
5240-5300 Valley Industrial
Blvd S Shakopee, MN 1973 Light Industrial 9.06 80,001 25%
7125 Northland Terrace Brooklyn Park, MN 1996 R&D/Flex 5.89 79,958 100%
6900 Shady Oak Road Eden Prairie, MN 1980 R&D/Flex 4.60 49,190 100%
6477-6525 City West Parkway Eden Prairie, MN 1984 R&D/Flex 7.00 89,113 77%
1157 Valley Park Drive Shakopee, MN 1997 Bulk Warehouse 9.97 126,014 100%
500-530 Kasota Avenue SE Minneapolis, MN 1976 Manufacturing 4.47 85,442 12%
770-786 Kasota Avenue SE Minneapolis, MN 1976 Manufacturing 3.16 56,388 100%
800 Kasota Avenue SE Minneapolis, MN 1976 Manufacturing 4.10 100,250 100%
2530-2570 Kasota Avenue St. Paul, MN 1976 Manufacturing 4.56 75,426 62%
504 Malcolm Ave. SE Minneapolis, MN 1999 Bulk Warehouse 7.50 143,066 100%
5555 12th Ave. East Shakopee, MN 2000 Bulk Warehouse 7.81 128,593 36%
--------- ---
SUBTOTAL OR AVERAGE 4,944,153 88%
--------- ---
NASHVILLE
1621 Heil Quaker Boulevard Nashville, TN (a) 1975 Bulk Warehouse 11.29 160,661 100%
417 Harding Industrial Drive Nashville, TN 1972 Bulk Warehouse 13.70 207,440 100%
3099 Barry Drive Portland, TN 1995 Manufacturing 6.20 109,058 0%
3150 Barry Drive Portland, TN 1993 Bulk Warehouse 26.32 268,253 100%
5599 Highway 31 West Portland, TN 1995 Bulk Warehouse 20.00 161,500 0%
1650 Elm Hill Pike Nashville, TN 1984 Light Industrial 3.46 41,228 100%
1102 Appleton Drive Nashville, TN 1984 Light Industrial 1.73 28,022 34%
1931 Air Lane Drive Nashville, TN 1984 Light Industrial 10.11 87,549 92%
470 Metroplex Drive (g) Nashville, TN 1986 Light Industrial 8.11 102,040 100%
</Table>
25
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
NASHVILLE (CONT.)
1150 Antiock Pike Nashville, TN 1987 Bulk Warehouse 9.83 146,055 81%
4640 Cummings Park Nashville, TN 1986 Bulk Warehouse 14.69 100,000 100%
211 Nesbit North Nashville, TN 1983 Bulk Warehouse 6.12 135,625 100%
211 Nesbit South Nashville, TN 1983 Bulk Warehouse 6.10 135,925 100%
211 Nesbit West Nashville, TN 1985 Bulk Warehouse 3.05 67,500 100%
556 Metroplex Drive Nashville, TN 1983 Light Industrial 3.66 43,026 100%
7600 Eastgate Blvd. Lebanon, TN 2002 Bulk Warehouse 22.10 423,500 100%
--------- ---
SUBTOTAL OR AVERAGE 2,217,382 85%
--------- ---
NORTHERN NEW JERSEY
60 Ethel Road West Piscataway, NJ 1982 Light Industrial 3.93 42,820 100%
70 Ethel Road West Piscataway, NJ 1979 Light Industrial 3.78 62,000 100%
601-629 Montrose Avenue South Plainfield,
NJ 1974 Light Industrial 5.83 75,000 100%
9 Princess Road Lawrenceville, NJ 1985 R&D/Flex 2.36 24,375 100%
11 Princess Road Lawrenceville, NJ 1985 R&D/Flex 5.33 55,000 91%
15 Princess Road Lawrenceville, NJ 1986 R&D/Flex 2.00 20,625 82%
17 Princess Road Lawrenceville, NJ 1986 R&D/Flex 1.82 18,750 100%
220 Hanover Avenue Hanover, NJ 1987 Bulk Warehouse 29.27 158,242 100%
244 Shefield Street Mountainside, NJ 1965/1986 Light Industrial 2.20 23,430 100%
31 West Forest Street (g) Englewood, NJ 1978 Light Industrial 6.00 110,000 100%
25 World's Fair Drive Franklin, NJ 1986 R&D/Flex 1.81 20,000 100%
14 World's Fair Drive Franklin, NJ 1980 R&D/Flex 4.53 60,000 100%
16 World's Fair Drive Franklin, NJ 1981 Light Industrial 3.62 43,400 0%
18 World's Fair Drive Franklin, NJ 1982 R&D/Flex 1.06 13,000 100%
23 World's Fair Drive Franklin, NJ 1982 Light Industrial 1.20 16,000 100%
12 World's Fair Drive Franklin, NJ 1981 Light Industrial 3.85 65,000 100%
49 Napoleon Court Franklin, NJ 1982 Light Industrial 2.06 32,500 100%
50 Napoleon Court Franklin, NJ 1982 Light Industrial 1.52 20,158 100%
22 World's Fair Drive Franklin, NJ 1983 Light Industrial 3.52 50,000 80%
26 World's Fair Drive Franklin, NJ 1984 Light Industrial 3.41 47,000 89%
24 World's Fair Drive Franklin, NJ 1984 Light Industrial 3.45 47,000 93%
20 Worlds Fair Drive Lot 13 Sumerset, NJ 1999 R&D Flex 4.25 30,000 100%
10 New Maple Road Pine Brook, NJ 1973/1999 Bulk Warehouse 18.13 265,376 100%
60 Chapin Road Pine Brook, NJ 1977/2000 Bulk Warehouse 13.61 259,230 100%
45 Route 46 Pine Brook, NJ 1974/1987 Light Industrial 6.54 84,284 61%
43 Route 46 Pine Brook, NJ 1974/1987 Light Industrial 2.48 35,629 63%
39 Route 46 Pine Brook, NJ 1970 R&D Flex 1.64 22,249 87%
26 Chapin Road Pine Brook, NJ 1983 Light Industrial 5.15 76,127 92%
30 Chapin Road Pine Brook, NJ 1983 Light Industrial 5.15 75,688 74%
20 Mountain Hook Road Pine Brook, NJ 1972/1984 Bulk Warehouse 14.02 213,991 98%
30 Mountain Hook Road Pine Brook, NJ 1972/1987 Light Industrial 3.36 51,570 100%
55 Route 46 Pine Brook, NJ 1978/1994 R&D Flex 2.13 24,051 72%
16 Chapin Road Pine Brook, NJ 1987 R&D Flex 4.61 68,358 74%
20 Chapin Road Pine Brook, NJ 1987 R&D Flex 5.69 84,571 100%
Sayreville Lot 4 Sayreville, NJ 2001 Light Industrial 6.88 62,400 92%
400 Raritan Center Parkway Edison, NJ 1983 Light Industrial 7.16 81,190 100%
300 Columbus Circle Edison, NJ 1983 R&D Flex 9.38 123,029 60%
400 Apgar Franklin
Twnship, NJ 1987 Bulk Warehouse 14.34 111,824 74%
500 Apgar Franklin
Twnship, NJ 1987 Reg. Warehouse 5.00 58,585 100%
201 Circle Dr. North Piscataway, NJ 1987 Bulk Warehouse 5.24 113,697 94%
1 Pearl Ct. Allendale, NJ 1978 Light Industrial 3.00 46,400 100%
2 Pearl Ct. Allendale, NJ 1979 Light Industrial 3.00 39,170 100%
3 Pearl Ct. Allendale, NJ 1978 Light Industrial 3.00 40,650 100%
4 Pearl Ct. Allendale, NJ 1979 Light Industrial 3.00 41,227 73%
5 Pearl Ct. Allendale, NJ 1977 Light Industrial 3.00 37,343 35%
6 Pearl Ct. Allendale, NJ 1980 Light Industrial 10.40 99,700 95%
7 Pearl Ct. Allendale, NJ 1979 Light Industrial 6.50 44,750 100%
59 Route 17 Allendale, NJ 1979 Light Industrial 5.90 60,000 100%
--------- ---
SUBTOTAL OR AVERAGE 3,255,389 91%
--------- ---
PHILADELPHIA
212 Welsh Pool Road Exton, PA 1975/1997 Light Industrial 6.56 25,361 100%
230-240 Welsh Pool Road Exton, PA 1975/1997 Manufacturing 6.56 30,000 100%
264 Welsh Pool Road Exton, PA 1975/1996 R&D/Flex 2.84 11,256 100%
254 Welsh Pool Road Exton, PA 1975/1998 Light Industrial 2.84 28,180 100%
256 Welsh Pool Road Exton, PA 1975/1999 Light Industrial 2.84 12,038 0%
213 Welsh Pool Road Exton, PA 1975/1998 Light Industrial 3.01 22,095 100%
251 Welsh Pool Road Exton, PA 1975/1991 R&D/Flex 4.10 25,546 100%
253-255 Welsh Pool Road Exton, PA 1975/1980 Light Industrial 4.10 20,800 100%
151-161 Philips Road Exton, PA 1975/1990 Light Industrial 3.82 30,065 100%
210 Philips Road Exton, PA 1975/1998 Manufacturing 6.56 26,827 100%
215 Welsh Pool Road Exton, PA 1975/1998 Light Industrial 2.12 14,041 100%
217 Welsh Pool Road Exton, PA 1975/1997 Light Industrial 2.12 11,293 100%
216 Philips Road Exton, PA 1985 Light Industrial 2.99 39,037 100%
</Table>
26
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
PHILADELPHIA (CONT.)
202 Philips Road Exton, PA 1972/1991 Reg. Warehouse 2.94 46,750 100%
20 McDonald Blvd Aston, PA 1988 Light Industrial 2.22 28,900 73%
30 McDonald Blvd Aston, PA 1988 Light Industrial 1.68 22,000 100%
2994-96 Samuel Drive Bensalem, PA 1974 Bulk Warehouse 10.06 214,320 100%
964 Postal Road Lehigh, PA 1986 Light Industrial 0.00 44,800 100%
966 Postal Road Lehigh, PA 1987 Light Industrial 0.00 43,245 100%
999 Postal Road Lehigh, PA 1988 Light Industrial 5.60 43,600 100%
7331 William Avenue Lehigh, PA 1989 Bulk Warehouse 3.90 43,400 100%
7346 Penn Drive Lehigh, PA 1988 Reg. Warehouse 7.30 72,000 100%
7350 William Drive Lehigh, PA 1989 Reg. Warehouse 8.70 96,000 75%
7377 William Drive Lehigh, PA 1989 Reg. Warehouse 4.50 43,440 100%
7072 Snow Drift Lehigh, PA 1975 Light Industrial 4.50 61,157 100%
2000 Cabot Boulevard West Langhorne, PA 1984 R&D/Flex 3.06 39,969 100%
2005 Cabot Boulevard West Langhorne, PA 1984 R&D/Flex 3.00 22,000 100%
2010 Cabot Boulevard West Langhorne, PA 1984 Light Industrial 4.00 52,831 67%
2200 Cabot Boulevard West Langhorne, PA 1979 Light Industrial 3.98 61,543 100%
2260-2270 Cabot Boulevard
West Langhorne, PA 1980 R&D/Flex 2.12 29,288 95%
3000 Cabot Boulevard West Langhorne, PA 1986 Light Industrial 4.14 34,693 78%
180 Wheeler Court Langhorne, PA 1974 Light Industrial 6.45 78,213 100%
2512 Metropolitan Drive Trevose, PA 1981 Light Industrial 3.54 37,000 100%
2510 Metropolitan Drive Trevose, PA 1981 Light Industrial 2.26 40,000 100%
2515 Metropolitan Drive Trevose, PA 1974 Light Industrial 2.50 42,000 100%
2555 Metropolitan Drive Trevose, PA 1981 Light Industrial 4.40 60,000 100%
2450 Metropolitan Drive Trevose, PA 1983 Light Industrial 6.98 69,952 73%
2495 Metropolitan Drive Trevose, PA 1981 Light Industrial 8.59 80,000 100%
4667 Somerton Road Trevose, PA 1974 Light Industrial 7.66 118,000 90%
835 Wheeler Way Langhorne, PA 1974 Light Industrial 5.68 64,402 73%
--------- ---
SUBTOTAL OR AVERAGE 1,886,042 94%
--------- ---
PHOENIX
1045 South Edward Drive Tempe, AZ 1976 Light Industrial 2.12 38,560 0%
46 N. 49th Ave. Phoenix, AZ 1986 Reg. Warehouse 5.16 82,288 100%
--------- ---
SUBTOTAL OR AVERAGE 120,848 68%
--------- ---
PORTLAND
5687 International Way(i) Milwaukee, OR 1974 Light Industrial 3.71 52,080 87%
5795 SW Jean Road (h) Lake Oswego, OR 1985 Light Industrial 3.02 37,352 73%
12130 NE Ainsworth
Circle(g) Portland, OR 1986 R&D/Flex 4.39 53,021 100%
5509 NW 122nd Ave(g) Milwaukee, OR 1995 Light Industrial 2.51 26,850 100%
6105-6113 NE 92nd Avenue(i) Portland, OR 1978/1986 Light Industrial 7.42 145,250 100%
8727 NE Marx Drive(h) Portland, OR 1987 Light Industrial 6.59 111,000 100%
3388 SE 20th Street Portland, OR 1981 Light Industrial 0.25 11,810 69%
5962-5964 NE 87th Avenue Portland, OR 1979 Light Industrial 1.28 14,000 100%
11620 NE Ainsworth Circle Portland, OR 1992 Light Industrial 1.55 10,000 100%
11824 NE Ainsworth Circle Portland, OR 1992 Light Industrial 2.13 20,812 54%
12124 NE Ainsworth Circle Portland, OR 1984 Light Industrial 2.52 29,040 100%
11632 NE Ainsworth Circle Portland, OR 1990 Light Industrial 9.63 124,610 100%
--------- ---
SUBTOTAL OR AVERAGE 635,825 95%
--------- ---
SALT LAKE CITY
2255 South 300 West (l) Salt Lake
City, UT 1980 Light Industrial 4.56 103,018 83%
512 Lawndale Drive (m) Salt Lake
City, UT 1981 Light Industrial 35.00 396,372 88%
1270 West 2320 South West Valley, UT 1986/1992 R&D/Flex 1.49 13,025 100%
1275 West 2240 South West Valley, UT 1986/1992 R&D/Flex 2.06 38,227 100%
1288 West 2240 South West Valley, UT 1986/1992 R&D/Flex 0.97 13,300 57%
2235 South 1300 West West Valley, UT 1986/1992 Light Industrial 1.22 19,000 75%
1293 West 2200 South West Valley, UT 1986/1992 R&D/Flex 0.86 13,300 100%
1279 West 2200 South West Valley, UT 1986/1992 R&D/Flex 0.91 13,300 32%
1272 West 2240 South West Valley, UT 1986/1992 Light Industrial 3.07 34,870 64%
1149 West 2240 South West Valley, UT 1986/1992 Light Industrial 1.71 21,250 100%
1142 West 2320 South West Valley, UT 1997 Light Industrial 1.52 17,500 100%
1152 West 2240 South West Valley, UT 1999 R&D Flex 13.56 55,785 57%
--------- ---
SUBTOTAL OR AVERAGE 738,947 84%
--------- ---
SOUTHERN NEW JERSEY
2-5 North Olnev Ave. Cherry Hill, NJ 1963/85 Light Industrial 2.10 58,139 100%
2 Springdale Road Cherry Hill, NJ 1968 Light Industrial 1.44 21,008 100%
4 Springdale Road (g) Cherry Hill, NJ 1963/85 Light Industrial 3.02 58,189 100%
8 Springdale Road Cherry Hill, NJ 1966 Light Industrial 3.02 45,054 93%
2050 Springdale Road Cherry Hill, NJ 1965 Light Industrial 3.40 51,060 100%
1 Esterbrook Lane Cherry Hill, NJ 1965 Light Industrial 1.71 8,610 100%
16 Springdale Road Cherry Hill, NJ 1967 Light Industrial 5.30 48,922 100%
5 Esterbrook Lane Cherry Hill, NJ 1966/88 Reg. Warehouse 5.45 39,167 100%
2 Pin Oak Lane Cherry Hill, NJ 1968 Light Industrial 4.45 51,230 44%
6 Esterbrook Lane Cherry Hill, NJ 1966 Light Industrial 3.96 32,914 100%
3 Computer Drive Cherry Hill, NJ 1966 Bulk Warehouse 11.40 181,000 67%
</Table>
27
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- --------- ------------
SOUTHERN NEW JERSEY (CONT.)
28 Springdale Road Cherry Hill, NJ 1967 Light Industrial 2.93 38,949 100%
3 Esterbrook Lane Cherry Hill, NJ 1968 Light Industrial 2.15 32,844 100%
4 Esterbrook Lane Cherry Hill, NJ 1969 Light Industrial 3.42 39,266 100%
26 Springdale Road Cherry Hill, NJ 1968 Light Industrial 3.25 29,492 100%
1 Keystone Ave. Cherry Hill, NJ 1969 Light Industrial 4.15 60,983 80%
1919 Springdale Road Cherry Hill, NJ 1970 Light Industrial 5.13 49,300 100%
21 Olnev Ave. Cherry Hill, NJ 1969 Manufacturing 1.75 22,738 100%
19 Olnev Ave. Cherry Hill, NJ 1971 Light Industrial 4.36 53,962 100%
2 Keystone Ave. Cherry Hill, NJ 1970 Light Industrial 3.47 50,922 81%
18 Olnev Ave. Cherry Hill, NJ 1974 Light Industrial 8.85 62,542 100%
2030 Springdale Road Cherry Hill, NJ 1977 Light Industrial 6.24 88,872 100%
55 Carnegie Drive Cherry Hill, NJ 1988 Reg. Warehouse 15.20 90,804 100%
5 Carnegie Drive Cherry Hill, NJ 1987 Bulk Warehouse 13.70 142,750 100%
111 Whittendale Drive Morristown, NJ 1991/96 Reg. Warehouse 5.00 79,329 100%
9 Whittendale Drive Morristown, NJ 2000 Light Industrial 5.51 52,800 100%
1931 Olney Road Cherry Hill, NJ 1969 Light Industrial 2.90 45,770 100%
--------- ---
SUBTOTAL OR AVERAGE 1,536,616 93%
--------- ---
ST. LOUIS
8921-8971 Frost Avenue Hazelwood, MO (a) 1971 Bulk Warehouse 2.00 100,000 100%
9043-9083 Frost Avenue Hazelwood, MO (a) 1970/77 Bulk Warehouse 2.69 145,000 74%
2121 Chapin Industrial Drive Vinita Park, MO 1969/94 Bulk Warehouse 23.40 281,105 78%
10431-10449 Midwest
Industrial Olivette, MO 1967 Light Industrial 2.40 55,125 100%
10751 Midwest Industrial
Blvd. Olivette, MO 1965 Light Industrial 1.70 44,100 0%
6951 N. Hanley(g) Hazelwood, MO 1965 Bulk Warehouse 9.50 129,614 100%
4560 Anglum Road Hazelwood, MO 1970 Light Industrial 2.60 35,114 100%
1037 Warson - Bldg A St. Louis, MO 1968 Light Industrial 4.00 64,143 100%
1037 Warson - Bldg B St. Louis, MO 1968 Light Industrial 4.00 97,154 100%
1037 Warson - Bldg C St. Louis, MO 1968 Light Industrial 4.00 79,252 100%
1037 Warson - Bldg D St. Louis, MO 1968 Light Industrial 4.00 92,081 100%
--------- ---
SUBTOTAL OR AVERAGE 1,122,688 87%
--------- ---
TAMPA
6614 Adamo Drive Tampa, FL 1967 Reg. Warehouse 2.78 41,377 100%
6204 Benjamin Road Tampa, FL 1982 Light Industrial 4.16 60,975 79%
6206 Benjamin Road Tampa, FL 1983 Light Industrial 3.94 57,708 51%
6302 Benjamin Road Tampa, FL 1983 R&D/Flex 2.03 29,747 100%
6304 Benjamin Road Tampa, FL 1984 R&D/Flex 2.04 29,845 84%
6306 Benjamin Road Tampa, FL 1984 Light Industrial 2.58 37,861 87%
6308 Benjamin Road Tampa, FL 1984 Light Industrial 3.22 47,256 57%
5313 Johns Road Tampa, FL 1991 R&D/Flex 1.36 25,690 100%
5602 Thompson Center Court Tampa, FL 1972 R&D/Flex 1.39 14,914 83%
5411 Johns Road Tampa, FL 1997 Light Industrial 1.98 30,204 83%
5525 Johns Road Tampa, FL 1993 R&D/Flex 1.46 24,139 100%
5607 Johns Road Tampa, FL 1991 R&D/Flex 1.34 13,500 100%
5709 Johns Road Tampa, FL 1990 Light Industrial 1.80 25,480 100%
5711 Johns Road Tampa, FL 1990 Light Industrial 1.80 25,455 100%
5453 West Waters Avenue Tampa, FL 1987 R&D/Flex 0.66 7,200 100%
5455 West Waters Avenue Tampa, FL 1987 R&D/Flex 2.97 32,424 24%
5553 West Waters Avenue Tampa, FL 1987 Light Industrial 2.97 32,424 100%
5501 West Waters Avenue Tampa, FL 1990 R&D/Flex 1.53 15,870 83%
5503 West Waters Avenue Tampa, FL 1990 R&D/Flex 0.68 7,060 100%
5555 West Waters Avenue Tampa, FL 1990 R&D/Flex 2.31 23,947 85%
5557 West Waters Avenue Tampa, FL 1990 R&D/Flex 0.57 5,860 100%
5463 W. Waters Avenue Tampa, FL (f) 1996 R&D/Flex 3.50 44,427 91%
5903 Johns Road Tampa, FL 1987 Light Industrial 1.20 11,600 100%
5461 W. Waters Avenue Tampa, FL 1998 Light Industrial 1.84 21,778 100%
5471 W. Waters Avenue Tampa, FL 1999 R&D/Flex 2.00 23,778 100%
5505 Johns Road #7 Tampa, FL 1999 Light Industrial 2.12 30,019 100%
5481 W. Waters Avenue Tampa, FL 1999 R&D/Flex 3.60 41,861 100%
5483 W. Waters Avenue Tampa, FL 1999 R&D/Flex 2.92 33,861 100%
6702-6712 Benjamin Road (k) Tampa, FL 1982/1984 Light Industrial 9.20 107,540 91%
5905 Breckenridge Parkway Tampa, FL 1982 R&D/Flex 1.67 18,720 100%
5907 Breckenridge Parkway Tampa, FL 1982 R&D/Flex 0.53 5,980 100%
5909 Breckenridge Parkway Tampa, FL 1982 R&D/Flex 1.60 18,000 84%
5911 Breckenridge Parkway Tampa, FL 1982 R&D/Flex 2.70 30,397 100%
5910 Breckenridge Parkway Tampa, FL 1982 R&D/Flex 4.77 53,591 46%
5912 Breckenridge Parkway Tampa, FL 1982 R&D/Flex 4.70 52,806 86%
4515-4519 George Road Tampa, FL 1985 Light Industrial 5.00 64,742 91%
6301 Benjamin Road Tampa, FL 1986 R&D/Flex 1.91 27,249 100%
5723 Benjamin Road Tampa, FL 1986 R&D/Flex 2.97 42,270 100%
6313 Benjamin Road Tampa, FL 1986 R&D/Flex 1.90 27,066 100%
5801 Benjamin Road Tampa, FL 1986 Light Industrial 3.83 54,550 91%
5802 Benjamin Road Tampa, FL 1986 R&D/Flex 4.06 57,705 66%
</Table>
28
<Table>
<Caption>
LOCATION YEAR BUILT- LAND AREA OCCUPANCY AT
BUILDING ADDRESS CITY/STATE ENCUMBRANCES RENOVATED BUILDING TYPE (ACRES) GLA 12/31/02
---------------- ---------- ------------ ----------- ------------- ---------- ---------- ------------
TAMPA (CONT.)
5925 Benjamin Road Tampa, FL 1986 R&D/Flex 2.05 29,109 69%
---------- ---
SUBTOTAL OR AVERAGE 1,385,985 85%
---------- ---
OTHER
2800 Airport Road(j) Denton, TX 1968 Manufacturing 29.91 222,403 100%
3501 Maple Street Abilene, TX 1980 Manufacturing 34.42 123,700 0%
4200 West Harry Street(h) Wichita, KS 1972 Bulk Warehouse 21.45 177,655 100%
Industrial Park No. 2 West Lebanon, NH 1968 Bulk Warehouse 10.27 156,200 100%
6601 S. 33rd Street McAllen, TX 1975 Reg. Warehouse 3.31 50,000 100%
9601 A Dessau Road Austin, TX 1999 Light Industrial 3.28 33,000 42%
9601 B Dessau Road Austin, TX 1999 Light Industrial 3.28 33,000 100%
9601 C Dessau Road Austin, TX 1999 Light Industrial 3.28 33,000 100%
555 Vista Blvd. Sparks, NV 1980 Bulk Warehouse 40.30 490,500 100%
---------- ---
SUBTOTAL OR AVERAGE 1,319,458 89%
---------- ---
TOTAL 59,979,894 90%
========== ===
</Table>
(a) These properties collateralized a $37.4 million mortgage loan that was to
mature on January 11, 2026. This loan was paid off and retired on January
13, 2003 and the properties that collateralized this mortgage loan are not
currently collateralizing any mortgage loan.
(b) This property collateralizes a $5.7 million mortgage loan which matures on
December 1, 2019.
(c) These properties collateralize a $6.0 million mortgage loan which matures
on January 1, 2013.
(d) This property collateralizes a $5.9 million mortgage loan which matures on
December 1, 2019.
(e) This property collateralizes a $2.2 million mortgage loan which matures on
October 1, 2006.
(f) This property collateralizes a $2.5 million mortgage loan which matures on
September 1, 2006.
(g) Comprised of two properties.
(h) Comprised of three properties.
(i) Comprised of four properties.
(j) Comprised of five properties.
(k) Comprised of six properties.
(l) Comprised of seven properties.
(m) Comprised of 29 properties.
29
TENANT AND LEASE INFORMATION
The Company has a diverse base of more than 2,500 tenants engaged in a
wide variety of businesses including manufacturing, retail, wholesale trade,
distribution and professional services. Most leases have an initial term of
between three and six years and provide for periodic rental increases that are
either fixed or based on changes in the Consumer Price Index. Industrial tenants
typically have net or semi-net leases and pay as additional rent their
percentage of the property's operating costs, including the costs of common area
maintenance, property taxes and insurance. As of December 31, 2002,
approximately 90% of the GLA of the properties was leased, and no single tenant
or group of related tenants accounted for more than 1.5% of the Company's rent
revenues, nor did any single tenant or group of related tenants occupy more than
1.5% of the Company's total GLA as of December 31, 2002.
The following table shows scheduled lease expirations for all leases
for the Company's properties as of December 31, 2002.
<Table>
<Caption>
ANNUAL BASE RENT
NUMBER OF PERCENTAGE OF UNDER EXPIRING PERCENTAGE OF TOTAL
YEAR OF LEASES GLA GLA LEASES ANNUAL BASE RENT
EXPIRATION (1) EXPIRING EXPIRING (2) EXPIRING (IN THOUSANDS) EXPIRING (2)
- --------------- ----------- ------------ ------------- ---------------- -------------------
2003 787 12,711,346 23.7% $ 58,601 23.4%
2004 591 12,171,402 22.7% 56,696 22.7%
2005 588 9,784,258 18.2% 47,537 19.0%
2006 304 6,145,570 11.4% 31,359 12.5%
2007 214 5,507,764 10.3% 25,757 10.3%
2008 64 1,834,679 3.4% 7,924 3.2%
2009 42 2,878,814 5.4% 10,952 4.4%
2010 20 909,762 1.7% 3,393 1.4%
2011 19 615,638 1.1% 3,383 1.4%
2012 14 384,883 0.7% 2,108 0.8%
Thereafter 12 762,901 1.4% 2,267 0.9%
----------- ----------- ----------- ----------- -----------
Total 2,655 53,707,017 100.0% $ 249,977 100.0%
=========== =========== =========== =========== ===========
</Table>
(1) Lease expirations as of December 31, 2002 assume tenants do not
exercise existing renewal, termination, or purchase options.
(2) Does not include existing vacancies of 6,272,877 aggregate square feet.
ITEM 3. LEGAL PROCEEDINGS
The Company is involved in legal proceedings arising in the ordinary
course of business. All such proceedings, taken together, are not expected to
have a material impact on the results of operations, financial position or
liquidity of the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
30
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
MARKET INFORMATION
The following table sets forth for the periods indicated the high and
low closing prices per share and distributions declared per share for the
Company's common stock, which trades on the New York Stock Exchange under the
trading symbol "FR".
<Table>
<Caption>
DISTRIBUTION
QUARTER ENDED HIGH LOW DECLARED
------------------ -------- -------- -------------
December 31, 2002 $ 30.69 $ 25.98 $ .6850
September 30, 2002 33.38 28.90 .6800
June 30, 2002 36.50 32.81 .6800
March 31, 2002 34.81 30.39 .6800
December 31, 2001 32.18 27.07 .6800
September 30, 2001 33.35 28.43 .6575
June 30, 2001 32.20 30.04 .6575
March 31, 2001 34.50 31.34 .6575
</Table>
The Company had 534 common stockholders of record registered with its
transfer agent as of March 7, 2003.
The Company has determined that, for federal income tax purposes,
approximately 42.16% of the total $107.0 million in distributions paid with
respect to 2002 represents ordinary dividend income to its stockholders, 4.47%
qualifies as short term capital gain, 14.11% qualifies as a 20 percent rate
capital gain, 9.23% qualifies as a 25 percent rate capital gain and the
remaining 30.03% represents a return of capital. Of the 14.11% of such dividends
that qualify as 20 percent rate capital gain, 51.67% (or 7.29 percentage points)
qualify as "qualified 5-year gain," to which, for certain taxpayers, a lower
rate will apply. In order to maintain its status as a REIT, the Company is
required to meet certain tests, including distributing at least 90% of its REIT
taxable income, or approximately $1.71 per share for 2002. The Company's
dividend policy is to meet the minimum distribution required to maintain the
Company's REIT qualification under the Internal Revenue Code.
The following information is required by section 201(d) of Regulation
S-K:
<Table>
<Caption>
NUMBER OF SECURITIES WEIGHTED-AVERAGE NUMBER OF SECURITIES
TO BE ISSUED UPON EXERCISE REMAINING AVAILABLE
EXERCISE OF PRICE OF OUTSTANDING FOR FURTHER ISSUANCE
OUTSTANDING OPTIONS, OPTIONS, WARRANTS UNDER EQUITY
PLAN CATEGORY WARRANTS AND RIGHTS AND RIGHTS COMPENSATION PLANS
- --------------------------------- -------------------- -------------------- --------------------
Equity Compensation
Plans Approved by
Security Holders .
161,500 $ 22.40 2,356,500
Equity Compensation
Plans Not Approved by
Security Holders (1) .
2,981,135 30.48 1,219,977
-------------- -------------- --------------
Total 3,142,635 $ 30.06 3,576,477
============== ============== ==============
</Table>
(1) See Notes 3 and 12 of the Notes to Consolidated Financial Statements
contained herein for a description of the plan.
31
ITEM 6. SELECTED FINANCIAL DATA
The following sets forth selected financial and operating data for the
Company on a historical consolidated basis. The following data should be read in
conjunction with the financial statements and notes thereto and Management's
Discussion and Analysis of Financial Condition and Results of Operations
included elsewhere in this Form 10-K. The historical statements of operations
for the years ended December 31, 2002, 2001 and 2000 include the results of
operations of the Company as derived from the Company's audited financial
statements. The historical statements of operations for the years ended December
31, 1999 and 1998 include the results of operations of the Company as derived
from the Company's audited financial statements except that the results of
operations of properties that were sold subsequent to December 31, 2001 that
were not classified as held for sale at December 31, 2001 and the results of
operations of properties that were classified as held for sale subsequent to
December 31, 2001 are presented in discontinued operations if they met both of
the following criteria: (a) the operations and cash flows of the property have
been (or will be) eliminated from the ongoing operations of the Company as a
result of the disposition and (b) the Company will not have any significant
involvement in the operations of the property after the disposal transaction.
The historical balance sheet data and other data as of December 31, 2002, 2001,
2000, 1999 and 1998 include the balances of the Company as derived from the
Company's audited financial statements.
32
<Table>
<Caption>
Year Year Year Year Year
Ended Ended Ended Ended Ended
2/31/02 12/31/01 12/31/00 12/31/99 12/31/98
---------- ---------- ---------- ---------- ----------
(In thousands, except per share and property data)
STATEMENTS OF OPERATIONS DATA:
Total Revenues ................................................ $ 346,565 $ 351,240 $ 355,189 $ 345,430 $ 324,573
Property Expenses ............................................. (106,987) (104,366) (102,653) (92,538) (94,252)
General and Administrative Expense ............................ (19,610) (18,609) (17,129) (13,259) (12,983)
Interest Expense .............................................. (90,387) (82,580) (83,925) (79,869) (71,833)
Amortization of Deferred Financing Costs ...................... (1,925) (1,809) (1,750) (1,362) (917)
Depreciation and Other Amortization ........................... (74,194) (68,307) (62,131) (62,857) (58,848)
Valuation Provision on Real Estate (a) ........................ -- (9,500) (2,900) -- --
Restructuring and Abandoned Pursuit Costs
Charge (b) .................................................. -- -- -- -- (11,941)
Equity in Income (Loss) of Joint Ventures ..................... 463 (791) 571 302 45
Disposition of Interest Rate Protection
Agreements (c) .............................................. -- -- -- -- (8,475)
Minority Interest Allocable to Continuing Operations .......... (7,014) (15,274) (13,280) (14,940) (5,706)
Gain on Sales of Real Estate .................................. 16,476 64,347 29,296 29,797 5,349
---------- ---------- ---------- ---------- ----------
Income from Continuing Operations Before Extraordinary
Loss and Cumulative Effect of Change in Accounting
Principle .................................................. 63,387 114,351 101,288 110,704 65,012
Income from Discontinued Operations (Including Gain on
Sale of Real Estate of $54,657 for the Year Ended December
31, 2002) (d) .............................................. 67,062 19,763 19,691 16,713 14,940
Minority Interest Allocable to Discontinued Operations ........ (10,046) (3,038) (3,115) (2,669) (2,255)
Extraordinary Loss (e) ........................................ (888) (10,309) -- -- --
Minority Interest Allocable to Extraordinary Loss ............. 134 1,597 -- -- --
Cumulative Effect of Change in Accounting Principle (f) ....... -- -- -- -- (1,976)
---------- ---------- ---------- ---------- ----------
Net Income .................................................... 119,649 122,364 117,864 124,748 75,721
Preferred Stock Dividends ..................................... (23,432) (30,001) (32,844) (32,844) (30,610)
---------- ---------- ---------- ---------- ----------
Net Income Available to Common Stockholders ................... $ 96,217 $ 92,363 $ 85,020 $ 91,904 $ 45,111
========== ========== ========== ========== ==========
Income from Continuing Operations Available to Common
Stockholders Before Extraordinary Loss and Cumulative
Effect of Change in Accounting Principle Per Weighted
Average Common Share Outstanding:
Basic ................................................ $ 1.02 $ 2.15 $ 1.77 $ 2.05 $ .92
========== ========== ========== ========== ==========
Diluted .............................................. $ 1.01 $ 2.13 $ 1.76 $ 2.04 $ .91
========== ========== ========== ========== ==========
Net Income Available to Common Stockholders Before
Extraordinary Loss and Cumulative Effect of Change
in Accounting Principle Per Weighted Average
Common Share Outstanding:
Basic ................................................ $ 2.47 $ 2.57 $ 2.20 $ 2.42 $ 1.26
========== ========== ========== ========== ==========
Diluted .............................................. $ 2.46 $ 2.56 $ 2.18 $ 2.41 $ 1.25
========== ========== ========== ========== ==========
Net Income Available to Common Stockholders
Per Weighted Average Common Share
Outstanding:
Basic ................................................ $ 2.45 $ 2.35 $ 2.20 $ 2.42 $ 1.20
========== ========== ========== ========== ==========
Diluted .............................................. $ 2.44 $ 2.34 $ 2.18 $ 2.41 $ 1.20
========== ========== ========== ========== ==========
Distributions Per Share ....................................... $ 2.7250 $ 2.6525 $ 2.5175 $ 2.420 $ 2.190
========== ========== ========== ========== ==========
Weighted Average Number of Common Shares
Outstanding:
Basic ................................................ 39,251 39,274 38,661 38,042 37,445
========== ========== ========== ========== ==========
Diluted .............................................. 39,453 39,552 38,917 38,144 37,627
========== ========== ========== ========== ==========
Net Income .................................................... $ 119,649 $ 122,364 $ 117,864 $ 124,748 $ 75,721
Other Comprehensive Income (Loss) :
Cumulative Transition Adjustment .............................. -- (14,920) -- -- --
Settlement of Interest Rate Protection Agreements ............. 1,772 (191) -- -- --
Mark-to-Market of Interest Rate Protection Agreements ......... (126) (231) -- -- --
Write-Off of Unamortized Interest Rate Protection
Agreements Due to the Early Retirement of Debt .............. -- 2,156 -- -- --
Amortization of Interest Rate Protection Agreements ........... 176 805 -- -- --
---------- ---------- ---------- ---------- ----------
Comprehensive Income .......................................... $ 121,471 $ 109,983 $ 117,864 $ 124,748 $ 75,721
========== ========== ========== ========== ==========
</Table>
33
<Table>
<Caption>
Year Year Year Year Year
Ended Ended Ended Ended Ended
12/31/02 12/31/01 12/31/00 12/31/99 12/31/98
------------ ------------ ------------ ------------ ------------
(In thousands, except per share and property data)
BALANCE SHEET DATA (END OF PERIOD):
Real Estate, Before Accumulated Depreciation ......... $ 2,697,269 $ 2,714,927 $ 2,440,810 $ 2,597,592 $ 2,583,033
Real Estate, After Accumulated Depreciation .......... 2,388,781 2,438,107 2,221,109 2,386,136 2,407,147
Real Estate Held for Sale, net ....................... 7,040 30,750 236,422 -- --
Total Assets ......................................... 2,629,973 2,621,400 2,618,493 2,526,963 2,554,462
Mortgage Loans Payable, Net, Unsecured Lines of
Credit and Senior Unsecured Debt, Net ............... 1,442,149 1,318,450 1,221,356 1,147,639 1,191,882
Total Liabilities .................................... 1,575,586 1,447,361 1,373,288 1,276,763 1,310,518
Stockholders' Equity ................................. 882,326 995,597 1,058,372 1,059,226 1,054,776
OTHER DATA:
Cash Flows From Operating Activities ................. $ 131,597 $ 147,091 $ 160,241 $ 176,897 $ 149,096
Cash Flows From Investing Activities ................. 34,591 (38,761) (87,300) (10,040) (535,554)
Cash Flows From Financing Activities ................. (166,188) (116,061) (67,819) (186,071) 395,059
Total Properties (g) ................................. 908 918 969 967 987
Total GLA, in Square Feet (g) ........................ 59,979,894 64,002,809 68,242,713 67,029,135 69,253,383
Occupancy Percentage (g) ............................. 90% 91% 95% 96% 95%
</Table>
- ----------
(a) Represents a valuation provision on real estate relating to certain
properties located in Columbus, Ohio, Des Moines, Iowa, Grand Rapids,
Michigan and Indianapolis, Indiana.
(b) Represents a restructuring charge of approximately $6.9 million
relating to severance costs (of which approximately $1.2 million is
non-cash relating to immediate vesting of restricted stock) and
approximately $5.0 million in costs relating to abandoned acquisitions.
(c) The approximate $8.5 million loss on disposition of interest rate
protection agreements for the year ended December 31, 1998 represents
the Company's settlement, through the Operating Partnership, of an
interest rate protection agreement that was scheduled to expire on
January 4, 1999. This agreement was entered into in December 1997 in
anticipation of 1998 senior unsecured debt offerings. Due to the
changing market conditions and the Company's expectation that it would
not issue debt securities associated with the interest rate protection
agreement, the Company settled its position in the interest rate
protection agreement.
(d) On January 1, 2002, the Company adopted the Financial Accounting
Standards Board's Statement of Financial Accounting Standards No. 144,
"Accounting for the Impairment or Disposal of Long Lived Assets" ("FAS
144"). FAS 144 addresses financial accounting and reporting for the
disposal of long lived assets. FAS 144 requires that the results of
operations and gains or losses on the sale of property sold subsequent
to December 31, 2001 that were not classified as held for sale at
December 31, 2001 as well as the results of operations from properties
that were classified as held for sale subsequent to December 31, 2001
be presented in discontinued operations if both of the following
criteria are met: (a) the operations and cash flows of the property
have been (or will be) eliminated from the ongoing operations of the
Company as a result of the disposal transaction and (b) the Company
will not have any significant involvement in the operations of the
property after the disposal transaction. FAS 144 also requires prior
period results of operations for these properties to be restated and
presented in discontinued operations in prior consolidated statements
of operations.
(e) In 2002, the Company paid off and retired certain senior unsecured
debt. The Company recorded an extraordinary loss of approximately $.9
million which is comprised of the amount paid above the carrying amount
of the senior unsecured debt, the write-off of pro rata unamortized
deferred financing costs and legal costs. In 2001, the Company paid off
and retired certain mortgage loans and certain senior unsecured debt.
The Company recorded an extraordinary loss of approximately $10.3
million which is comprised of the amount paid above the carrying amount
of the senior unsecured debt, the write-off of unamortized deferred
financing costs, the write-off of the unamortized portion of an
interest rate protection agreement which was used to fix the interest
rate on the senior unsecured debt prior to issuance, the settlement of
an interest rate protection agreement used to fix the retirement price
of the senior unsecured debt, prepayment fees, legal costs and other
expenses.
(f) In April 1998, the Accounting Standards Executive Committee of the
American Institute of Certified Public Accountants issued Statement of
Position 98-5, "Reporting on the Costs of Start-Up Activities" ("SOP
98-5"). SOP 98-5 requires that the net unamortized balance of all
start-up costs and organizational costs be written off as a cumulative
effect of a change in accounting principle and all future start-up
costs and organizational costs be expensed. Consistent with SOP 98-5,
the Company reported a cumulative effect of a change in accounting
principle in the amount of approximately $2.0 million to reflect the
write-off of the unamortized balance of organizational costs on the
Company's balance sheet.
(g) As of end of period and excludes properties under development.
34
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read in conjunction with "Selected
Financial Data" and the historical Consolidated Financial Statements and Notes
thereto appearing elsewhere in this Form 10-K.
First Industrial Realty Trust, Inc. was organized in the state of
Maryland on August 10, 1993. First Industrial Realty Trust, Inc. is a real
estate investment trust ("REIT"), as defined in the Internal Revenue Code. First
Industrial Realty Trust, Inc. and its subsidiaries (the "Company") began
operations on July 1, 1994. The Company's interests in its properties and land
parcels are held through partnerships controlled by the Company, including First
Industrial, L.P. (the "Operating Partnership"), of which the Company is the sole
general partner, as well as, among others, First Industrial Financing
Partnership, L.P., First Industrial Securities, L.P., First Industrial Mortgage
Partnership, L.P., First Industrial Pennsylvania, L.P., First Industrial
Harrisburg, L.P., First Industrial Indianapolis, L.P., FI Development Services,
L.P. and TK-SV, LTD., of which the sole general partner of each is a
wholly-owned subsidiary of the Company, and the sole limited partner of each is
the Operating Partnership, as well as limited liability companies of which the
Operating Partnership is the sole member. The Operating Partnership is also the
sole stockholder of First Industrial Development Services, Inc. The Company,
through separate wholly-owned limited liability companies of which the Operating
Partnership is the sole member, also owns minority equity interests in, and
provides asset and property management services to, three joint ventures which
invest in industrial properties.
The Company believes the following critical accounting policies affect
its more significant judgments and estimates used in the preparation of its
consolidated financial statements. The Company maintains an allowance for
doubtful accounts which is based on estimates of potential losses
which could result from the inability of the Company's tenants to satisfy
outstanding billings with the Company. If the financial condition of the
Company's tenants were to deteriorate, an increase in the allowance may be
required. Also, the Company reviews its properties on a quarterly basis for
impairment and provides a provision if impairments are determined. Future
adverse changes in the Company's markets may cause an increase in this
provision.
RESULTS OF OPERATIONS
COMPARISON OF YEAR ENDED DECEMBER 31, 2002 TO YEAR ENDED DECEMBER 31, 2001
At December 31, 2002, the Company owned 908 in-service properties with
approximately 60.0 million square feet of gross leasable area ("GLA"), compared
to 918 in-service properties with approximately 64.0 million square feet of GLA
at December 31, 2001. During 2002, the Company acquired 90 in-service properties
containing approximately 5.7 million square feet of GLA, completed development
of 17 properties totaling approximately 3.2 million square feet of GLA and sold
110 in-service properties totaling approximately 11.3 million square feet of
GLA, four out of service properties and several land parcels. The Company also
took nine properties out of service that are under redevelopment, comprising
approximately 1.8 million square feet of GLA, and placed in service two
properties comprising approximately .2 million square feet of GLA.
Rental income and tenant recoveries and other income decreased by
approximately $4.7 million or 1.3% due primarily to a decrease in same store
rental income and tenant recoveries and other income as discussed below, as well
as a decrease in rental income and tenant recoveries and other income for the
year ended December 31, 2002 as compared to the year ended December 31, 2001 due
to properties sold subsequent to December 31, 2000 (other than property sales
that were classified as discontinued operations). This decrease is partially
offset by an increase in rental income and tenant recoveries and other income
for the year ended December 31, 2002 as compared to the year ended December 31,
2001 due to properties acquired subsequent to December 31, 2000. Rental income
and tenant recoveries and other income from in-service properties owned prior to
January 1, 2001 decreased by approximately $3.4 million or 1.2% due primarily to
a decrease in average occupied GLA for the year ended December 31, 2002 as
compared to the year ended December 31, 2001.
Property expenses, which include real estate taxes, repairs and
maintenance, property management, utilities, insurance and other expenses,
increased by approximately $2.6 million or 2.5%. This increase is due primarily
to an increase in same-store property expenses and an increase in property
expenses for the year ended December 31, 2002 as compared to the year ended
December 31, 2001 due to properties acquired subsequent to December 31, 2000.
This increase is partially offset by a decrease in property expenses from in
service properties sold subsequent to December 31, 2000 (other than property
sales that were classified as discontinued operations). Property expenses from
in-service properties owned
35
prior to January 1, 2001 increased by approximately $4.0 million or 4.9% due
primarily to an increase in repairs and maintenance expense, insurance expense
and other expense. The increase in repairs and maintenance expense is due
primarily to an increase in maintenance company expenses and related costs. The
increase in insurance is due primarily to an increase in insurance premiums. The
increase in other expense is primarily due to an increase in bad debt expense
for the year ended December 31, 2002 as compared to the year ended December 31,
2001.
General and administrative expense increased by approximately $1.0
million due primarily to increases in employee compensation and additional
employees for the year ended December 31, 2002 as compared to the year ended
December 31, 2001, partially offset by the write-off of the Company's technology
initiative investment of approximately $.7 million during the year ended
December 31, 2001.
Interest expense increased by approximately $7.8 million for the year
ended December 31, 2002 as compared to the year ended December 31, 2001 due
primarily to an increase in the weighted average debt balance outstanding for
the year ended December 31, 2002 ($1,433.0 million) as compared to the year
ended December 31, 2001 ($1,310.3 million) and a decrease in capitalized
interest for the year ended December 31, 2002 due to a decrease in development
activities. This was partially offset by a decrease in the weighted average
interest rate for the year ended December 31, 2002 (6.82%) as compared to the
year ended December 31, 2001 (7.06%).
Amortization of deferred financing costs increased by approximately $.1
million or 6.4% due primarily to the amortization of deferred financing costs
associated with the issuance of additional senior unsecured debt.
Depreciation and other amortization increased by approximately $5.9
million due primarily to additional depreciation and amortization recognized for
properties acquired subsequent to December 31, 2000.
The valuation provision on real estate of approximately $9.5 million
for the year ended December 31, 2001 represents a valuation provision on certain
properties located in the Columbus, Ohio, Des Moines, Iowa and Indianapolis,
Indiana markets.
Equity in income of joint ventures increased by approximately $1.3
million due primarily to the increase in gain on sale of real estate of one of
the Company's joint ventures, the start-up of one of the Company's joint
ventures in December 2001 and the Company recognizing its proportionate interest
in a valuation provision recognized in one of the Company's joint ventures
during the year ended December 31, 2001, offset by a loss on the sale of real
estate of one of the Company's joint ventures.
The approximate $16.5 million gain on sale of real estate for the year
ended December 31, 2002 resulted from the sale of 12 industrial properties that
were identified as held for sale at December 31, 2001, 16 industrial properties
that were sold to one of the Company's joint ventures and several land parcels.
Gross proceeds from these sales were approximately $156.8 million.
The $64.3 million gain on sale of real estate for the year ended
December 31, 2001 resulted from the sale of 132 industrial properties and
several land parcels. Gross proceeds from these sales were approximately $386.9
million.
Income from discontinued operations of approximately $67.1 million for
the year ended December 31, 2002 reflects the results of operations and gain on
sale of 86 industrial properties that were not held for sale at December 31,
2001 and were sold during the year ended December 31, 2002, the gain associated
with the assignment of the right to third parties to purchase certain
properties, as well as the results of operations of four industrial properties
identified as held for sale at December 31, 2002. Gross proceeds from the sales
of the 86 industrial properties were approximately $316.7 million, resulting in
a gain on sale of real estate of approximately $54.7 million.
Income from discontinued operations of approximately $19.8 million for
the year ended December 31, 2001 reflects the results of operations of the 86
industrial properties that were not held for sale at December 31, 2001 and were
sold during the year ended December 31, 2002 as well as the results of
operations of four industrial properties identified as held for sale at December
31, 2002.
36
The approximate $.9 million extraordinary loss for the year ended
December 31, 2002 is due to the early retirement of senior unsecured debt. The
extraordinary loss is comprised of the amount paid above the carrying amount of
the senior unsecured debt, the write-off of pro rata unamortized deferred
financing costs and legal costs.
The $10.3 million extraordinary loss for the year ended December 31,
2001 is due to the early retirement of senior unsecured debt and various
mortgage loans. The extraordinary loss is comprised of the amount paid above the
carrying amount of the senior unsecured debt, the write-off of unamortized
deferred financing costs, the write-off of the unamortized portion of an
interest rate protection agreement which was used to fix the interest rate on
the senior unsecured debt prior to issuance, the settlement of an interest rate
protection agreement used to fix the retirement price of the senior unsecured
debt, prepayment fees, legal costs and other expenses.
COMPARISON OF YEAR ENDED DECEMBER 31, 2001 TO YEAR ENDED DECEMBER 31, 2000
At December 31, 2001, the Company owned 918 in-service properties with
approximately 64.0 million square feet of GLA, compared to 969 in-service
properties with approximately 68.2 million square feet of GLA at December 31,
2000. During 2001, the Company acquired 79 in-service properties containing
approximately 4.4 million square feet of GLA, completed development of seven
properties totaling approximately 1.1 million square feet of GLA and sold 128
in-service properties totaling approximately 8.9 million square feet of GLA,
four out of service properties and several land parcels. The Company also took
13 properties out of service that were under redevelopment, comprising
approximately 1.1 million square feet of GLA, and placed in service four
properties comprising approximately .3 million square feet of GLA.
Rental income and tenant recoveries and other income decreased by
approximately $3.9 million or 1.1% due primarily to a decrease in rental income
and tenant recoveries and other income for the year ended December 31, 2001 as
compared to the year ended December 31, 2000 due to properties sold subsequent
to December 31, 1999. This decrease is partially offset by an increase in
rental income and tenant recoveries and other income for the year ended December
31, 2001 as compared to the year ended December 31, 2000 due to properties
acquired subsequent to December 31, 1999. Rental income and tenant recoveries
and other income from in-service properties owned prior to January 1, 2000
increased by approximately $3.5 million or 1.3% due primarily to an increase in
recoverable income due to an increase in property expenses (as discussed below)
for the year ended December 31, 2001 as compared to the year ended December 31,
2000.
Property expenses, which include real estate taxes, repairs and
maintenance, property management, utilities, insurance and other expenses
increased by approximately $1.7 million or 1.7%. This increase is due primarily
to an increase in same store property expenses as discussed below, as well as an
increase in property expenses for the year ended December 31, 2001 as compared
to the year ended December 31, 2000 due to properties acquired subsequent to
December 31, 1999. This increase is partially offset by a decrease in property
expenses for the year ended December 31, 2001 as compared to the year ended
December 31, 2000 due to properties sold during the year ended December 31,
2000. Property expenses from in-service properties owned prior to January 1,
2000 increased by approximately $3.7 million or 5.1% due primarily to an
increase in real estate taxes, repairs and maintenance, utilities expense and
insurance expense. The increase in real estate taxes is primarily due to an
increase in real estate taxes in many of the Company's markets. The increase in
repairs and maintenance is due primarily to an increase in landscaping and
related expenses, as well as an increase in maintenance fees. The increase in
utilities expense increased due to an increase in gas and electricity expenses.
The increase in insurance is due primarily to an increase in insurance premiums.
General and administrative expense increased by approximately $1.5
million due primarily to increases in employee compensation and additional
employees for the year ended December 31, 2001 as compared to the year ended
December 31, 2000 and the write-off of the Company's technology initiative
investment of approximately $.7 million during the year ended December 31, 2001.
Interest expense decreased by approximately $1.3 million for the year
ended December 31, 2001 as compared to the year ended December 31, 2000 due
primarily to a decrease in the weighted average interest rate for the year ended
December 31, 2001 (7.06%) as compared to the year ended December 31, 2000
(7.32%) and an increase in capitalized interest for the year ended December 31,
2001 due to an increase in development activities. This was offset by an
increase in average debt balance outstanding for the year ended December 31,
2001 as compared to the year ended
37
December 31, 2000. The average debt balance outstanding for the years ended
December 31, 2001 and 2000 was approximately $1,310.3 million and $1,226.6
million, respectively.
Amortization of deferred financing costs increased by approximately $.1
million or 3.4% due primarily to the amortization of deferred financing costs
associated with the issuance of additional senior unsecured debt.
Depreciation and other amortization increased by approximately $6.2
million due primarily to additional depreciation and amortization recognized for
properties acquired subsequent to December 31, 1999 as well as additional
depreciation due to fewer properties classified as held for sale throughout the
year ended December 31, 2001 as compared to the year ended December 31, 2000.
The valuation provision on real estate of approximately $9.5 million
for the year ended December 31, 2001 represents a valuation provision primarily
on certain properties located in the Columbus, Ohio, Des Moines, Iowa and
Indianapolis, Indiana markets.
The valuation provision on real estate of approximately $2.9 million
for the year ended December 31, 2000 represents a valuation provision on the
Company's exit market portfolio in Grand Rapids, Michigan.
Equity in income of joint ventures decreased by approximately $1.4
million due primarily to the Company recognizing its proportionate interest in a
valuation provision recognized in one of the Company's joint ventures.
The $64.3 million gain on sale of real estate for the year ended
December 31, 2001 resulted from the sale of 132 industrial properties and
several land parcels. Gross proceeds from these sales were approximately $386.9
million.
The $29.3 million gain on sale of real estate for the year ended
December 31, 2000 resulted from the sale of 109 industrial properties and
several land parcels. Gross proceeds from these sales were approximately $433.7
million.
Income from discontinued operations of approximately $19.8 million for
the year ended December 31, 2001 reflects the results of operations of the 86
industrial properties that were not held for sale at December 31, 2001 and were
sold during the year ended December 31, 2002 as well as the results of
operations of four industrial properties identified as held for sale at December
31, 2002.
Income from discontinued operations of approximately $19.7 million for
the year ended December 31, 2000 reflects the results of operations of the 86
industrial properties that were not held for sale at December 31, 2001 and were
sold during the year ended December 31, 2002 as well as the results of
operations of four industrial properties identified as held for sale at December
31, 2002.
The $10.3 million extraordinary loss for the year ended December 31,
2001 is due to the early retirement of senior unsecured debt and various
mortgage loans. The extraordinary loss is comprised of the amount paid above the
carrying amount of the senior unsecured debt, the write-off of unamortized
deferred financing costs, the write-off of the unamortized portion of an
interest rate protection agreement which was used to fix the interest rate on
the senior unsecured debt prior to issuance, the settlement of an interest rate
protection agreement used to fix the retirement price of the senior unsecured
debt, prepayment fees, legal costs and other expenses.
LIQUIDITY AND CAPITAL RESOURCES
At December 31, 2002, the Company's restricted cash was approximately
$31.1 million. Included in restricted cash are approximately $2.8 million of
cash reserves required to be set aside under the 1995 Mortgage Loan (hereinafter
defined) for payments of security deposit refunds, capital expenditures,
interest, real estate taxes, insurance and re-leasing costs. The portion of the
cash reserves relating to payments for capital expenditures, interest, real
estate taxes and insurance was established monthly, distributed to the Company
as such expenditures were made and was replenished to a level adequate to make
the next periodic payment of such expenditures. The portion of the cash reserves
relating to security deposit refunds was adjusted as tenants turned over. The
portion of the cash reserves relating to re-leasing costs resulted from a
deposit of a lease termination fee that was to be used to cover the costs of
re-leasing that space. On January 13, 2003, the Company, through the Mortgage
Partnership, paid off and retired the 1995 Mortgage Loan (hereinafter defined),
at which time such cash reserves were released to the Company. Also
38
included in restricted cash is approximately $28.3 million of gross proceeds
from the sales of certain properties. These sales proceeds will be disbursed as
the Company exchanges into properties under Section 1031 of the Internal Revenue
Code.
39
YEAR ENDED DECEMBER 31, 2002
Net cash provided by operating activities of approximately $131.6
million for the year ended December 31, 2002 was comprised primarily of net
income before minority interest of approximately $136.6 million and adjustments
for non-cash items of approximately $12.6 million, partially offset by the net
change in operating assets and liabilities of approximately $17.6 million. The
adjustments for the non-cash items of approximately $12.6 million are primarily
comprised of depreciation and amortization of approximately $84.7 million and an
extraordinary loss of approximately $.9 million from the early retirement of
debt, partially offset by the gain on sale of real estate of approximately $71.1
million and the effect of the straight-lining of rental income of approximately
$1.9 million.
Net cash provided by investing activities of approximately $34.6
million for the year ended December 31, 2002 was comprised primarily of the net
proceeds from the sale of real estate, distributions from the Company's joint
ventures and the repayment of mortgage loans receivable, partially offset by the
acquisition of real estate, development of real estate, capital expenditures
related to the expansion and improvement of existing real estate, contributions
to one of the Company's joint ventures and an increase in restricted cash from
sales proceeds deposited with an intermediary for Section 1031 exchange
purposes.
Net cash used in financing activities of approximately $166.2 million
for the year ended December 31, 2002 was comprised primarily of repayments on
mortgage loans payable, the repurchase of restricted stock from employees of the
Company to pay for withholding taxes on the vesting of restricted stock, the
purchase of treasury shares, the purchase of U.S. Government securities used as
substitute collateral to execute a legal defeasances of portions of the 1995
Mortgage Loan (hereinafter defined), common and preferred stock dividends and
unit distributions, debt issuance costs incurred in conjunction with the
issuance of senior unsecured debt, the partial payoff of the 2027 Notes
(hereinafter defined), net repayments under the Company's unsecured lines of
credit and the redemption of the Company's Series B Preferred Stock (hereinafter
defined), partially offset by the proceeds from the issuance of senior unsecured
debt, net proceeds from the issuance of common stock and a book overdraft.
YEAR ENDED DECEMBER 31, 2001
Net cash provided by operating activities of approximately $147.1
million for the year ended December 31, 2001 was comprised primarily of net
income before minority interest of approximately $139.1 million and adjustments
for non-cash items of approximately $36.0 million, offset by the net change in
operating assets and liabilities of approximately $28.0 million. The adjustments
for the non-cash items of approximately $36.0 million are primarily comprised of
depreciation and amortization of approximately $83.2 million, a valuation
provision on real estate of approximately $9.5 million, equity in net loss of
joint ventures of approximately $.8 million and an extraordinary loss of
approximately $10.3 million from the early retirement of debt, offset by the
gain on sale of real estate of approximately $64.3 million and the effect of the
straight-lining of rental income of approximately $3.5 million.
Net cash used in investing activities of approximately $38.8 million
for the year ended December 31, 2001 was comprised primarily of the acquisition
of real estate, development of real estate, capital expenditures related to the
expansion and improvement of existing real estate and contributions to one of
the Company's joint ventures, offset by the net proceeds from the sale of real
estate, distributions from two of three of the Company's joint ventures, a
decrease in restricted cash due to the use of restricted cash to purchase
properties to effect Section 1031 exchanges and the repayment of mortgage loans
receivable.
Net cash used in financing activities of approximately $116.1 million
for the year ended December 31, 2001 was comprised primarily of repayments on
mortgage loans payable, the repurchase of restricted stock from employees of the
Company to pay for withholding taxes on the vesting of restricted stock, the
purchase of treasury shares, the purchase of U.S. Government securities used as
substitute collateral to execute a legal defeasance of a portion of the 1995
Mortgage Loan (hereinafter defined), common and preferred stock dividends and
unit distributions, debt issuance costs incurred in conjunction with the
issuance of senior unsecured debt, prepayment fees incurred in the early
retirement of two mortgage loans, the payoff of senior unsecured debt and the
redemption of approximately $41.3 million in preferred stock, offset by net
borrowings under the Company's unsecured line of credit, the proceeds from the
issuance of senior unsecured debt, net proceeds from the issuance of common
stock and a book overdraft.
40
YEAR ENDED DECEMBER 31, 2000
Net cash provided by operating activities of approximately $160.2
million for the year ended December 31, 2000 was comprised primarily of net
income before minority interest of approximately $134.3 million, adjustments for
non-cash items of approximately $44.4 million offset by the net change in
operating assets and liabilities of approximately $18.5 million. The adjustments
for the non-cash items of approximately $44.4 million are primarily comprised of
depreciation and amortization of approximately $72.3 million and a valuation
provision on real estate of approximately $2.9 million, partially offset by the
gain on sale of real estate of approximately $29.3 million and the effect of the
straight-lining of rental income of approximately $1.5 million.
Net cash used in investing activities of approximately $87.3 million
for the year ended December 31, 2000 was comprised primarily of the acquisition
of real estate, development of real estate, capital expenditures related to the
expansion and improvement of existing real estate and an increase in restricted
cash from sales proceeds deposited with an intermediary for Section 1031
exchange purposes, partially offset by the net proceeds from the sale of real
estate, distributions from the Company's joint ventures and the repayment of
mortgage loans receivable.
Net cash used in financing activities of approximately $67.8 million
for the year ended December 31, 2000 was comprised primarily of repayments on
mortgage loans payable, the purchase of treasury shares, the repurchase of
restricted stock from employees of the Company to pay for withholding taxes on
the vesting of restricted stock, the purchase of U.S. Government securities used
as substitute collateral to execute a legal defeasance of a portion of the 1995
Mortgage Loan (hereinafter defined), common and preferred stock dividends and
unit distributions and debt issuance costs incurred in conjunction with the
Company's unsecured line of credit, partially offset by the net borrowings under
the Company's unsecured line of credit and net proceeds from the issuance of
common stock.
RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The ratio of earnings to fixed charges and preferred stock dividends
was 1.18, 1.20 and 1.38 for the years ended December 31, 2002, 2001 and 2000,
respectively. The decrease in earnings to fixed charges and preferred stock
dividends between fiscal years 2002 and 2001 is primarily due to a decrease in
income from continuing operations in fiscal year 2002 due to a decrease in
rental income and tenant recoveries and other income and an increase in
depreciation and amortization expense for fiscal year 2002 as compared to fiscal
year 2001 as discussed in "Results of Operations" above, offset by a valuation
provision on real estate in fiscal year 2001 as discussed in "Results of
Operations" above. The decrease in earnings to fixed charges and preferred stock
dividends between fiscal years 2001 and 2000 is primarily due to a decrease in
income from continuing operations in fiscal year 2001 due to a decrease in
rental income and tenant recoveries and other income, an increase in
depreciation and amortization expense and an increase in a valuation provision
on real estate for fiscal year 2001 as compared to fiscal year 2000 as discussed
in "Results of Operations" above.
SEGMENT REPORTING
Management views the Company as a single segment.
INVESTMENT IN REAL ESTATE, DEVELOPMENT OF REAL ESTATE AND SALE OF REAL ESTATE
During the year ended December 31, 2002, the Company acquired 90
industrial properties comprising, in the aggregate, approximately 5.7 million
square feet of GLA and several land parcels for an aggregate purchase price of
approximately $239.4 million, excluding costs incurred in conjunction with the
acquisition of the properties. Twenty-nine of the 90 industrial properties
acquired, comprising approximately .8 million square feet of GLA, were acquired
from two of the Company's joint ventures for an aggregate purchase price of
approximately $32.3 million. The Company also completed the development of 17
industrial properties comprising approximately 3.2 million square feet of GLA at
a cost of approximately $116.8 million.
During the year ended December 31, 2002, the Company sold 86 industrial
properties comprising approximately 8.5 million square feet of GLA that were not
classified as held for sale at December 31, 2001, 12 properties comprising
approximately .9 million square feet of GLA that were classified as held for
sale at December 31, 2001, 16 properties comprising approximately 2.5 million
square feet of GLA that were sold to one of the Company's joint ventures,
several land parcels and assigned the right to third parties to purchase certain
properties. Gross proceeds from these sales were approximately $473.5 million.
In accordance with FAS 144 (hereinafter defined), the results of operations and
gain on sale of real estate for the 86 of the 114 sold properties that were not
identified as held for sale at December 31, 2001
41
and the gain associated with the assignment of the right to third parties to
purchase certain properties are included in discontinued operations.
The Company has committed to the construction of 31 development
projects totaling approximately 2.8 million square feet of GLA for an estimated
investment of approximately $155.9 million. Of this amount, approximately $26.2
million remains to be funded. These developments are expected to be funded with
proceeds from the sale of select properties, cash flow from operations and
borrowings under the Company's 2002 Unsecured Line of Credit (hereinafter
defined). The Company expects to place in service all of these development
projects during the next twelve months. There can be no assurance that the
Company will place these projects in service during the next twelve months or
that the actual completion cost will not exceed the estimated completion cost
stated above.
REAL ESTATE HELD FOR SALE
At December 31, 2002, the Company had four industrial properties
comprising approximately .3 million square feet of GLA held for sale. Income
from operations of the four industrial properties held for sale for the years
ended December 31, 2002, 2001 and 2000 is approximately $1.0 million, $1.1
million and $.9 million, respectively. Net carrying value of the industrial
properties held for sale at December 31, 2002 is approximately $7.0 million. In
accordance with FAS 144 (hereinafter defined), the results of operations of the
four industrial properties identified as held for sale during 2002, are included
in discontinued operations. There can be no assurance that such properties held
for sale will be sold.
INVESTMENTS IN JOINT VENTURES
During the year ended December 31, 2002, the Company, through
wholly-owned limited liability companies in which the Operating Partnership is
the sole member, recognized, in the aggregate, approximately $1.9 million (net
of the intercompany elimination) in acquisition, asset management and property
management fees from the Company's three industrial real estate joint ventures.
The Company, through wholly-owned limited liability companies in which the
Operating Partnership is the sole member, invested approximately $8.2 million
and received distributions of approximately $2.7 million from the Company's
three industrial real estate joint ventures. As of December 31, 2002, the
Company's three industrial real estate joint ventures owned or had economic
interests in 77 industrial properties comprising approximately 7.2 million
square feet of GLA.
42
MORTGAGE LOANS PAYABLE
On December 29, 1995 the Company, through the Mortgage Partnership,
borrowed $40,200 under a mortgage loan (the "1995 Mortgage Loan"). In June 2000,
the Company purchased approximately $1.2 million of U.S. Government securities
as substitute collateral to execute a legal defeasance of approximately $1.2
million of the 1995 Mortgage Loan. In March 2001, the Company purchased
approximately $1.1 million of U.S. Government securities as substitute
collateral to execute a legal defeasance of approximately $1.1 million of the
1995 Mortgage Loan. In January 2002, the Company purchased approximately $.8
million of U.S. Government securities as substitute collateral to execute a
legal defeasance of approximately $.8 million of the 1995 Mortgage Loan. In June
2002, the Company purchased approximately $1.9 million of U.S. Government
securities as substitute collateral to execute a legal defeasance of
approximately $1.9 million of the 1995 Mortgage Loan. In December 2002, the
Company purchased approximately $11.1 million of U.S. Government securities as
substitute collateral to execute a legal defeasance of approximately $11.1
million of the 1995 Mortgage Loan. The terms of these legal defeasances require
the Mortgage Partnership to use the gross proceeds from the maturities of the
U.S. Government securities to paydown and subsequently retire the defeased
portion of the 1995 Mortgage Loan in January 2003. Upon the execution of these
legal defeasances, seven properties collateralizing the 1995 Mortgage Loan were
released and subsequently sold. The Company is carrying the defeased portions of
the 1995 Mortgage Loan on its balance sheet until it pays down and retires the
defeased portions of the 1995 Mortgage Loan in January 2003. The 1995 Mortgage
Loan provided for monthly principal and interest payments based on a 28-year
amortization schedule and was to mature on January 11, 2026. The interest rate
under the 1995 Mortgage Loan was fixed at 7.22% per annum through January 11,
2003. After January 11, 2003, the interest rate was to adjust through a
predetermined formula based on the applicable Treasury rate. At December 31,
2002, the 1995 Mortgage Loan was collateralized by 16 properties held by the
Mortgage Partnership. On January 13, 2003, the Company, through the Mortgage
Partnership, paid off and retired the 1995 Mortgage Loan.
On April 1, 2002, the Company, through the Operating Partnership,
assumed a mortgage loan in the principal amount of approximately $5.8 million
(the "Acquisition Mortgage Loan VIII"). The Acquisition Mortgage Loan VIII is
collateralized by one property in Rancho Dominguez, California, bears interest
at a fixed rate of 8.26% and provides for monthly principal and interest
payments based on a 22-year amortization schedule. The Acquisition Mortgage Loan
VIII matures on December 1, 2019. The Acquisition Mortgage Loan VIII may be
prepaid only after November 2004 in exchange for the greater of a 1% prepayment
fee or yield maintenance premium.
On April 1, 2002, the Company, through the Operating Partnership,
assumed a mortgage loan in the principal amount of approximately $6.0 million
(the "Acquisition Mortgage Loan IX"). The Acquisition Mortgage Loan IX is
collateralized by one property in Rancho Dominguez, California, bears interest
at a fixed rate of 8.26% and provides for monthly principal and interest
payments based on a 22-year amortization schedule. The Acquisition Mortgage Loan
IX matures on December 1, 2019. The Acquisition Mortgage Loan IX may be prepaid
only after November 2004 in exchange for the greater of a 1% prepayment fee or
yield maintenance premium.
On January 31, 1997, the Company, through the Operating Partnership,
assumed a loan in the amount of approximately $.7 million (the "LB Loan II"). On
June 14, 2002, the Company, through the Operating Partnership, paid off and
retired the LB Loan II with no prepayment fee.
On August 31, 1998, the Company, through the Operating Partnership,
assumed a mortgage loan in the amount of approximately $1.0 million (the
"Acquisition Mortgage Loan VI"). On July 2, 2002, the Company, through the
Operating Partnership, paid off and retired the Acquisition Mortgage Loan VI
with no prepayment fee.
On March 20, 1996, the Company, through the Operating Partnership and
the Indianapolis Partnership, entered into a $36.8 million mortgage loan (the
"CIGNA Loan"). On October 1, 2002, the Company, through the Operating
Partnership, paid off and retired the CIGNA Loan with no prepayment fee.
On December 23, 1997, the Company, through the Operating Partnership,
assumed a mortgage loan in the amount of approximately $3.6 million (the
"Acquisition Mortgage Loan III"). On December 4, 2002, the Company, through the
Operating Partnership, paid off and retired the Acquisition Mortgage Loan III
with no prepayment fee.
43
SENIOR UNSECURED DEBT
On April 15, 2002, the Company, through the Operating Partnership,
issued $200 million of senior unsecured debt which matures on April 15, 2012 and
bears a coupon interest rate of 6.875% (the "2012 Notes"). The issue price of
the 2012 Notes was 99.310%. Interest is paid semi-annually in arrears on April
15 and October 15. The Company also entered into interest rate protection
agreements which were used to fix the interest rate on the 2012 Notes prior to
issuance. The Company settled the interest rate protection agreements for
approximately $1.8 million of proceeds, which is included in other comprehensive
income. The debt issue discount and the settlement amount of the interest rate
protection agreements are being amortized over the life of the 2012 Notes as an
adjustment to interest expense. The 2012 Notes contain certain covenants,
including limitations on incurrence of debt and debt service coverage.
On April 15, 2002, the Company, through the Operating Partnership,
issued $50 million of senior unsecured debt which matures on April 15, 2032 and
bears a coupon interest rate of 7.75% (the "2032 Notes"). The issue price of the
2032 Notes was 98.660%. Interest is paid semi-annually in arrears on April 15
and October 15. The debt issue discount is being amortized over the life of the
2032 Notes as an adjustment to interest expense. The 2032 Notes contain certain
covenants, including limitations on incurrence of debt and debt service
coverage.
On May 13, 1997, the Company, through the Operating Partnership, issued
$100 million of senior unsecured debt which matures on May 15, 2027 and bears a
coupon interest rate of 7.15% (the "2027 Notes"). The issue price of the 2027
Notes was 99.854%. The 2027 Notes were redeemable, at the option of the holders
thereof, on May 15, 2002. The Company received redemption notices from holders
representing approximately $84.9 million of the 2027 Notes outstanding. On May
15, 2002, the Company paid off and retired approximately $84.9 million of the
2027 Notes. Due to the partial payoff of the 2027 Notes, the Company has
recorded an extraordinary loss of approximately $.9 million comprised of the
amount paid above the carrying amount of the 2027 Notes, the write-off of the
pro rata unamortized deferred financing costs and legal costs.
UNSECURED LINE OF CREDIT
On September 27, 2002, the Company, through the Operating Partnership,
amended and restated its $300 million unsecured line of credit (the "2002
Unsecured Line of Credit", formerly, the "2000 Unsecured Line of Credit"). The
2002 Unsecured Line of Credit matures on September 30, 2005 and bears interest
at a floating rate of LIBOR plus .70%, or the Prime Rate, at the Company's
election. The net unamortized deferred financing costs related to the 2000
Unsecured Line of Credit and any additional deferred financing costs incurred
amending the 2002 Unsecured Line of Credit are being amortized over the life of
the 2002 Unsecured Line of Credit in accordance with Emerging Issues Task Force
Issue 98-14, "Debtor's Accounting for Changes in Line-of-Credit or
Revolving-Debt Arrangements".
INTEREST RATE SWAP AGREEMENTS
In January 2002 and August 2002, the Company, through the Operating
Partnership, entered into two interest rate swap agreements (the "Interest Rate
Swap Agreements") which fixed the interest rate on a portion of the Company's
2002 Unsecured Line of Credit. The Company designated the Interest Rate Swap
Agreements as cash flow hedges. The January 2002 interest rate swap agreement
has a notional value of $25 million, is effective from February 4, 2002 through
February 4, 2003 and fixed the LIBOR rate at 2.4975%. The August 2002 interest
rate swap agreement has a notional value of $25 million, is effective from
September 5, 2002 through September 5, 2003 and fixed the LIBOR rate at 1.884%.
Any payments or receipts from the Interest Rate Swap Agreements will be treated
as a component of interest expense. The Company anticipates that the Interest
Rate Swap Agreements will be highly effective, and, as a result, the change in
value will be shown in other comprehensive income.
PREFERRED STOCK
On May 14, 1997, the Company issued 4,000,000 Depositary Shares, each
representing 1/100th of a share of the Company's 8 3/4%, $.01 par value, Series
B Cumulative Preferred Stock (the "Series B Preferred Stock"), at an initial
offering price of $25.00 per Depositary Share. On or after May 14, 2002, the
Series B Preferred Stock became redeemable for cash at the option of the
Company, in whole or in part, at a redemption price equivalent to $25.00 per
Depositary Share, or $100 million in the aggregate, plus dividends accrued and
unpaid to the redemption date. On April 12, 2002, the Company called for the
redemption of all of its outstanding Series B Preferred Stock at the price of
44
$25.00 per Depositary Share, plus accrued and unpaid dividends. The Company
redeemed the Series B Preferred Stock on May 14, 2002 and paid a prorated second
quarter dividend of $.26736 per Depositary Share, totaling approximately $1.1
million.
MARKET RISK
The following discussion about the Company's risk-management activities
includes "forward-looking statements" that involve risk and uncertainties.
Actual results could differ materially from those projected in the
forward-looking statements.
This analysis presents the hypothetical gain or loss in earnings, cash
flows or fair value of the financial instruments and derivative instruments
which are held by the Company at December 31, 2002 that are sensitive to changes
in the interest rates. While this analysis may have some use as a benchmark, it
should not be viewed as a forecast.
In the normal course of business, the Company also faces risks that are
either non-financial or non-quantifiable. Such risks principally include credit
risk and legal risk and are not represented in the following analysis.
At December 31, 2002, $1,346.8 million (approximately 93.4% of total
debt at December 31, 2002) of the Company's debt was fixed rate debt (included
in the fixed rate debt is $75.0 million of borrowings under the Company's 2002
Unsecured Line of Credit which the Company fixed the interest rate via interest
rate swap agreements) and $95.3 million (approximately 6.6% of total debt at
December 31, 2002) was variable rate debt. The Company also has outstanding a
written put option (the "Written Option"), which was issued in conjunction with
the initial offering of one tranche of senior unsecured debt. Currently, the
Company does not enter into financial instruments for trading or other
speculative purposes.
For fixed rate debt, changes in interest rates generally affect the
fair value of the debt, but not earnings or cash flows of the Company.
Conversely, for variable rate debt, changes in the interest rate generally do
not impact the fair value of the debt, but would affect the Company's future
earnings and cash flows. The interest rate risk and changes in fair market value
of fixed rate debt generally do not have a significant impact on the Company
until the Company is required to refinance such debt. See Note 5 to the
consolidated financial statements for a discussion of the maturity dates of the
Company's various fixed rate debt.
Based upon the amount of variable rate debt outstanding at December 31,
2002, a 10% increase or decrease in the interest rate on the Company's variable
rate debt would decrease or increase, respectively, future net income and cash
flows by approximately $.3 million per year. A 10% increase in interest rates
would decrease the fair value of the fixed rate debt at December 31, 2002 by
approximately $52.0 million to $1,412.7 million. A 10% decrease in interest
rates would increase the fair value of the fixed rate debt at December 31, 2002
by approximately $56.5 million to $1,521.2 million. A 10% increase in interest
rates would decrease the fair value of the Written Option at December 31, 2002
by approximately $2.6 million to $13.9 million. A 10% decrease in interest rates
would increase the fair value of the Written Option at December 31, 2002 by
approximately $2.8 million to $19.3 million.
ISSUANCE OF RESTRICTED STOCK AND EMPLOYEE STOCK OPTIONS
During the year ended December 31, 2002, the Company awarded 90,260
shares of restricted common stock to certain employees and 3,720 shares of
restricted common stock to certain Directors. These shares of restricted common
stock had a fair value of approximately $3.2 million on the date of grant. The
restricted common stock vests over periods from one to ten years. Compensation
expense will be charged to earnings over the respective vesting periods.
During the year ended December 31, 2002, the Company issued 945,600
non-qualified employee stock options to certain officers, Directors and
employees of the Company. These non-qualified employee stock options vest over
periods from one to three years, have a strike price of $30.53 - $33.15 per
share and expire ten years from the date of grant.
45
COMMON STOCK
For the year ended December 31, 2002, certain employees of the Company
exercised 561,418 non-qualified employee stock options. Proceeds to the Company
were approximately $15.9 million.
DIVIDENDS/DISTRIBUTIONS
On April 1, 2002, the Company paid quarterly preferred stock dividends
of $54.688 per share (equivalent to $.54688 per Depositary Share) on its 8 3/4%,
$.01 par value, Series B Cumulative Preferred Stock (the "Series B Preferred
Stock"), $53.906 per share (equivalent to $.53906 per Depositary Share) on its 8
5/8%, $.01 par value, Series C Cumulative Preferred Stock (the "Series C
Preferred Stock"), $49.687 per share (equivalent to $.49687 per Depositary
Share) on its 7.95%, $.01 par value, Series D Cumulative Preferred Stock (the
"Series D Preferred Stock") and $49.375 per share (equivalent to $.49375 per
Depositary Share) on its 7.90%, $.01 par value, Series E Cumulative Preferred
Stock (the "Series E Preferred Stock"). The preferred stock dividends paid on
April 1, 2002 totaled, in the aggregate, approximately $7.2 million. On May 14,
2002, the Company paid a prorated second quarter dividend of $26.736 per share,
totaling approximately $1.1 million, on its Series B Preferred Stock. On July 1,
2002, September 30, 2002 and December 31, 2002, the Company paid quarterly
preferred stock dividends of $53.906 per share (equivalent to $.53906 per
Depositary Share) on its Series C Preferred Stock, $49.687 per share (equivalent
to $.49687 per Depositary Share) on its Series D Preferred Stock and $49.375 per
share (equivalent to $.49375 per Depositary Share) on its Series E Preferred
Stock. The preferred stock dividends paid on July 1, 2002, September 30, 2002
and December 31, 2002 totaled, in the aggregate, approximately $5.0 million per
fiscal quarter.
On January 22, 2002, the Company and the Operating Partnership paid a
fourth quarter 2001 distribution of $.6800 per common share/unit, totaling
approximately $31.2 million. On April 22, 2002, the Company and the Operating
Partnership paid a first quarter 2002 dividend/distribution of $.6800 per common
share/unit, totaling approximately $31.5 million. On July 22, 2002, the Company
and the Operating Partnership paid a second quarter 2002 dividend/distribution
of $.6800 per common share/unit, totaling approximately $31.6 million. On
October 21, 2002, the Company and the Operating Partnership paid a third quarter
2002 dividend/distribution of $.6800 per common share/unit, totaling
approximately $31.6 million.
TREASURY STOCK
During the year ended December 31, 2002, the Company repurchased
1,091,500 shares of its common stock at a weighted average price of
approximately $27.02 per share.
SUBSEQUENT EVENTS
On January 13, 2003, the Company, through the Mortgage Partnership,
paid off and retired the 1995 Mortgage Loan.
On January 27, 2003, the Company and the Operating Partnership paid a
fourth quarter 2002 distribution of $.6850 per common share/unit, totaling
approximately $31.1 million.
On March 5, 2003, the Company declared a first quarter 2003
distribution of $.6850 per common share/unit on its common stock/units which is
payable on April 21, 2003. The Company also declared first quarter 2003
dividends of $53.906 per share ($.53906 per Depositary share), $49.687 per share
($.49687 per Depositary share) and $49.375 per share ($.49375 per Depositary
share) on its Series C Preferred Stock, Series D Preferred Stock and Series E
Preferred Stock, respectively, totaling, in the aggregate, approximately $5.0
million, which is payable on March 31, 2003.
From January 1, 2003 to March 7, 2003, the Company awarded 1,073 shares
of restricted common stock to certain Directors. These shares of restricted
common stock had a fair value of approximately $.03 million on the date of
grant. The restricted common stock vests over ten years. Compensation expense
will be charged to earnings over the respective vesting period.
From January 1, 2003 to March 7, 2003, the Company acquired or
completed development of two industrial properties for a total estimated
investment of approximately $26.7 million. The Company also sold six industrial
properties and two land parcels for approximately $15.7 million of gross
proceeds during this period.
46
From January 1, 2003 to March 7, 2003, the Company repurchased 37,300
shares of its common stock at a weighted average price of approximately $26.73
per share.
SHORT-TERM AND LONG-TERM LIQUIDITY NEEDS
The Company has considered its short-term (one year or less) liquidity
needs and the adequacy of its estimated cash flow from operations and other
expected liquidity sources to meet these needs. The Company believes that its
principal short-term liquidity needs are to fund normal recurring expenses, debt
service requirements and the minimum distribution required to maintain the
Company's REIT qualification under the Internal Revenue Code. The Company
anticipates that these needs will be met with cash flows provided by operating
activities.
The Company expects to meet long-term (greater than one year) liquidity
requirements such as property acquisitions, developments, scheduled debt
maturities, major renovations, expansions and other nonrecurring capital
improvements through the disposition of select assets, the issuance of long-term
unsecured indebtedness and the issuance of additional equity securities. As of
December 31, 2002 and March 7, 2003, $589.2 million of common stock, preferred
stock and depositary shares and approximately $250.0 million of debt securities
were registered and unissued under the Securities Act of 1933, as amended. The
Company also may finance the development or acquisition of additional properties
through borrowings under the 2002 Unsecured Line of Credit. At December 31,
2002, borrowings under the 2002 Unsecured Line of Credit bore interest at a
weighted average interest rate of 2.88%. As of March 7, 2003, the Company had
approximately $91.7 million available in additional borrowings under the 2002
Unsecured Line of Credit. The 2002 Unsecured Line of Credit bears interest at a
floating rate of LIBOR plus .70% or the Prime Rate, at the Company's election.
RELATED PARTY TRANSACTIONS
The Company periodically engages in transactions for which CB Richard
Ellis, Inc. acts as a broker. A relative of Michael W. Brennan, the President
and Chief Executive Officer and a director of the Company, is an employee of CB
Richard Ellis, Inc. For the year ended December 31, 2002, this relative received
approximately $.1 million in brokerage commissions paid by the Company.
ENVIRONMENTAL
The Company incurred environmental costs of approximately $.1 million
and approximately $.5 million in 2002 and 2001, respectively. The Company
estimates 2003 costs of approximately $.5 million. The Company estimates that
the aggregate cost which needs to be expended in 2003 and beyond with regard to
currently identified environmental issues will not exceed approximately $.5
million, a substantial amount of which will be the primary responsibility of the
tenant, the seller to the Company or another responsible party. This estimate
was determined by a third party evaluation.
INFLATION
For the last several years, inflation has not had a significant impact
on the Company because of the relatively low inflation rates in the Company's
markets of operation. Most of the Company's leases require the tenants to pay
their share of operating expenses, including common area maintenance, real
estate taxes and insurance, thereby reducing the Company's exposure to increases
in costs and operating expenses resulting from inflation. In addition, many of
the outstanding leases expire within six years which may enable the Company to
replace existing leases with new leases at higher base rentals if rents of
existing leases are below the then-existing market rate.
OTHER
In January 2002, the Company adopted the Financial Accounting Standards
Board's ("FASB") Statement of Financial Accounting Standards No. 144,
"Accounting for the Impairment or Disposal of Long Lived Assets" ("FAS 144").
FAS 144 addresses financial accounting and reporting for the disposal of long
lived assets. FAS 144 requires that the results of operations and gains or
losses on the sale of property sold subsequent to December 31, 2001 that were
not classified as held for sale at December 31, 2001 as well as the results of
operations from properties that were classified as held for sale subsequent to
December 31, 2001 be presented in discontinued operations if both of the
following criteria are met: (a) the operations and cash flows of the property
have been (or will be) eliminated from the
47
ongoing operations of the Company as a result of the disposal transaction and
(b) the Company will not have any significant continuing involvement in the
operations of the property after the disposal transaction. FAS 144 also requires
prior period results of operations for these properties to be restated and
presented in discontinued operations in prior consolidated statements of
operations.
In April 2002, the FASB issued Financial Accounting Standards No. 145,
"Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement
No. 13, and Technical Corrections" ("FAS 145"). FAS 145 rescinds both Statement
of Financial Accounting Standards No. 4, "Reporting Gains and Losses from
Extinguishment of Debt" ("FAS 4"), and the amendment to FAS 4, Statement of
Financial Accounting Standards No. 64, "Extinguishments of Debt Made to Satisfy
Sinking-Fund Requirements". FAS 145 eliminates the requirement that gains and
losses from the extinguishment of debt be aggregated and, if material,
classified as an extraordinary item, net of the related income tax effect,
unless the criteria in Accounting Principles Board Opinion No. 30, "Reporting
the Results of Operations- Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions" are met. FAS 145 is effective for transactions occurring
subsequent to May 15, 2002. In January of 2003, the Company paid off and retired
the 1995 Mortgage Loan. As this pay off and retirement was prior to the stated
maturity date of the 1995 Mortgage Loan, the Company wrote off unamortized
deferred financing costs in the amount of approximately $1.5 million. Prior to
the issuance of FAS 145, this write off would have been characterized as
extraordinary. Under FAS 145, it is not considered extraordinary but part of
continuing operations. The Company believes FAS 145 will not have an impact on
its consolidated financial position or liquidity.
In June 2002, the FASB issued Financial Accounting Standards No. 146,
"Accounting for Costs Associated with Exit or Disposal Activities" ("FAS 146").
FAS 146 requires that a liability for a cost associated with an exit or disposal
activity be recognized and measured initially at its fair value in the period in
which the liability is incurred. FAS 146 applies to costs associated with an
exit or disposal activity including, but not limited to, costs to terminate a
contract that is not a capital lease, costs to consolidate facilities or
relocate employees and certain one-time termination benefits provided to current
employees that are involuntarily terminated. FAS 146 is effective for exit or
disposal activities initiated after December 31, 2002. The Company does not
expect FAS 146 to have a material effect on its consolidated financial position,
liquidity, or results of operations.
In November 2002, the FASB issued Financial Accounting Standards
Interpretation No. 45, "Guarantor's Accounting and Disclosure Requirements for
Guarantees, Including Indirect Guarantees of Indebtedness of Others" ("FIN 45").
FIN 45 addresses disclosures to be made by a guarantor in its interim and annual
financial statements about its obligations under guarantees. FIN 45 clarifies
that a guarantor is required to recognize, at the inception of the guarantee, a
liability for the fair value of the obligation undertaken in issuing the
guarantee. In addition, FIN 45 requires footnote disclosure of certain other
information pertaining to guarantees. FIN 45 generally applies to contracts or
indemnification agreements that contingently require the guarantor to make
payments to the guaranteed party based on changes in an underlying variable that
is related to an asset, liability, or an equity security of the guaranteed
party, contracts that contingently require the guarantor to make payments to the
guaranteed party based on another entity's failure to perform under an
obligation agreement, and, in some cases, indirect guarantees of the
indebtedness of others. The disclosure requirements of FIN 45 are effective for
financial statements of interim or annual periods ending after December 15,
2002. The initial recognition and initial measurement provisions are applicable
on a prospective basis to guarantees issued or modified after December 31, 2002.
The Company has adopted the disclosure requirements of FIN 45 as of December 15,
2002 and does not expect the recognition requirements, which are to be applied
on a prospective basis to guarantees issued or modified after December 31, 2002.
The Company has adopted the disclosure requirements of FIN 45 as of December 15,
2002 and does not expect the recognition requirements, which are to be applied
on a prospective basis to guarantees issued or modified after December 31, 2002,
to have a material impact on the Company's financial position, liquidity, or
results of operations.
In December 2002, the FASB issued Financial Accounting Standards No.
148, "Accounting for Stock-Based Compensation-Transition and Disclosure" ("FAS
148"). FAS 148 amends Financial Accounting Standards No. 123, "Accounting for
Stock Based Compensation" ("FAS 123"). FAS 148 provides alternative methods of
transition for a voluntary change to the fair value based method of accounting
for stock-based employee compensation. In addition, FAS 148 amends the
disclosure requirements of FAS 123 to require prominent disclosures in both
annual and interim financial statements about the method of accounting for
stock-based employee compensation and the effect of the method used on reported
results. FAS 148 is effective for financial statements for fiscal years ending
after December 15, 2002. The Company is adopting FAS 123, as amended by FAS 148,
beginning January 1, 2003 using the Prospective Method of transition as
described in FAS 148. The Company does not expect FAS 148 to have a material
effect on its consolidated financial position, liquidity, or results of
operations.
48
In January 2003, the FASB issued Financial Accounting Standards
Interpretation No. 46, "Consolidation of Variable Interest Entities- an
interpretation of ARB No. 51" ("FIN 46"). FIN 46 addresses consolidation by
business enterprises of special purpose entities ("SPEs") to which the usual
condition for consolidation described in Accounting Research Bulletin No. 51
does not apply because the SPEs have no voting interests or otherwise are not
subject to control through ownership of voting interests. For Variable Interest
Entities created before February 1, 2003, the provisions of FIN 46 are effective
no later than the beginning of the first interim or annual reporting period that
starts after June 15, 2003. For Variable Interest Entities created after January
31, 2003, the provisions of FIN 46 are effective immediately. The Company is
currently assessing the impact of FIN 46 on its consolidated financial position,
liquidity, and results of operations.
49
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Response to this item is included in Item 7. "Management's Discussion
and Analysis of Financial Condition and Results of Operations" above.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
See Index to Financial Statements and Financial Statement Schedule on
page F-1 of this Form 10-K.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURES
None.
50
PART III
ITEM 10, 11, 12, 13. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT,
EXECUTIVE COMPENSATION, SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by Item 10, Item 11, Item 12 and Item
13 will be contained in the Registrant's definitive proxy statement
expected to be filed with the Securities and Exchange Commission no
later than 120 days after the end of the Registrant's fiscal year, and
thus is incorporated herein by reference in accordance with General
Instruction G(3) to Form 10-K. Information contained in the parts of
such proxy statement captioned "Stock Performance Graph", "Report of
the Compensation Committee", "Report of the Audit Committee" and in
statements with respect to the independence of the Audit Committee, and
the Audit Committee Charter attached to such proxy statement, are
specifically not incorporated herein by reference.
ITEM 14. CONTROLS AND PROCEDURES
The Company's principal executive officer and principal
financial officer, after evaluating the effectiveness of the Company's
disclosure controls and procedures (as defined in Exchange Act Rules
13a-14 (c) and 15d-14(c)) as of a date within 90 days before the filing
date of this report, have concluded that as of such date the Company's
disclosure controls and procedures were effective.
There have been no significant changes (including corrective
actions with regard to significant deficiencies or material weaknesses)
in the Company's internal controls or in other factors that could
significantly affect these controls subsequent to the date of the
evaluation referenced in the paragraph above.
51
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENTS, FINANCIAL STATEMENT SCHEDULE AND
REPORTS ON FORM 8-K
(a) FINANCIAL STATEMENTS, FINANCIAL STATEMENT SCHEDULE AND
EXHIBITS
(1 & 2) See Index to Financial Statements and Financial
Statement Schedule on page F-1 of this Form 10-K
(3) Exhibits:
Exhibits Description
- -------- -----------
3.1 Amended and Restated Articles of Incorporation of the Company
(incorporated by reference to Exhibit 3.1 of the Form 10-Q of
the Company for the fiscal quarter ended June 30, 1996, File
No. 1-13102)
3.2 Amended and Restated Bylaws of the Company, dated September
4, 1997 (incorporated by reference to Exhibit 1 of the
Company's Form 8-K, dated September 4, 1997, as filed on
September 29, 1997, File No. 1-13102)
3.3 Articles of Amendment to the Company's Articles of
Incorporation, dated June 20, 1994 (incorporated by reference
to Exhibit 3.2 of the Form 10-Q of the Company for the fiscal
quarter ended June 30, 1996, File No. 1-13102)
3.4 Articles of Amendment to the Company's Articles of
Incorporation, dated May 31, 1996 (incorporated by reference
to Exhibit 3.3 of the Form 10-Q of the Company for the fiscal
quarter ended June 30, 1996, File No. 1-13102)
3.5 Articles Supplementary relating to the Company's 8 5/8%
Series C Cumulative Preferred Stock, $.01 par value
(incorporated by reference to Exhibit 4.1 of the Form 8-K of
the Company dated June 6, 1997, File No. 1-13102)
3.6 Articles Supplementary relating to the Company's 7.95% Series
D Cumulative Preferred Stock, $.01 par value (incorporated by
reference to Exhibit 4.1 of the Form 8-K of the Company dated
February 6, 1998, File No. 1-13102)
3.7 Articles Supplementary relating to the Company's 7.90% Series
E Cumulative Preferred Stock, $.01 par value (incorporated by
reference to Exhibit 3.9 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-13102)
3.8 Articles Supplementary relating to the Company's Junior
Participating Preferred Stock, $.01 par value (incorporated
by reference to Exhibit 4.10 of Form S-3 of the Company and
First Industrial, L.P. dated September 24, 1997, Registration
No. 333-29879)
4.1 Deposit Agreement, dated June 6, 1997, by and among the
Company, First Chicago Trust Company of New York and holders
from time to time of Depositary Receipts (incorporated by
reference to Exhibit 4.2 of the Form 8-K of the Company,
dated June 6, 1997, File No. 1-13102)
4.2 Deposit Agreement, dated February 6, 1998, by and among the
Company, First Chicago Trust Company of New York and holders
from time to time of Depositary Receipts (incorporated by
reference to Exhibit 4.2 of the Form 8-K of the Company,
dated February 6, 1998, File No. 1-13102)
4.3 Deposit Agreement, dated March 18, 1998, by and among the
Company, First Chicago Trust Company of New York and holders
from time to time of Depositary Receipts (incorporated by
reference to Exhibit 4.12 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-13102)
4.4 Indenture, dated as of May 13, 1997, between First
Industrial, L.P. and First Trust National Association, as
Trustee (incorporated by reference to Exhibit 4.1 of the Form
10-Q of the Company for the fiscal quarter ended March 31,
1997, as amended by Form 10-Q/A No. 1 of the Company filed
May 30, 1997, File No. 1-13102)
4.5 Supplemental Indenture No. 1, dated as of May 13, 1997,
between First Industrial, L.P. and First Trust National
Association as Trustee relating to $150 million of 7.60%
Notes due 2007 and $100 million of 7.15% Notes due 2027
(incorporated by reference to Exhibit 4.2 of the Form 10-Q of
the Company for the fiscal quarter ended March 31, 1997, as
amended by Form 10-Q/A No. 1 of the Company filed May 30,
1997, File No. 1-13102)
52
Exhibits Description
- -------- -----------
4.6 Supplemental Indenture No. 2, dated as of May 22, 1997,
between First Industrial, L.P. and First Trust National
Association as Trustee relating to $100 million of 7 3/8%
Notes due 2011(incorporated by reference to Exhibit 4.4 of
the Form 10-Q of First Industrial, L.P. for the fiscal
quarter ended March 31, 1997, File No. 333-21873)
4.7 Supplemental Indenture No. 3 dated October 28, 1997 between
First Industrial, L.P. and First Trust National Association
providing for the issuance of Medium-Term Notes due Nine
Months or more from Date of Issue (incorporated by reference
to Exhibit 4.1 of Form 8-K of First Industrial, L.P., dated
November 3, 1997, as filed November 3, 1997, File No.
333-21873)
4.8 6.90% Medium-Term Note due 2005 in principal amount of $50
million issued by First Industrial, L.P. (incorporated by
reference to Exhibit 4.17 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-13102)
4.9 7.00% Medium-Term Note due 2006 in principal amount of $150
million issued by First Industrial, L.P. (incorporated by
reference to Exhibit 4.18 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-13102)
4.10 7.50% Medium-Term Note due 2017 in principal amount of $100
million issued by First Industrial, L.P. (incorporated by
reference to Exhibit 4.19 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-13102)
4.11 Trust Agreement, dated as of May 16, 1997, between First
Industrial, L.P. and First Bank National Association, as
Trustee (incorporated by reference to Exhibit 4.5 of the Form
10-Q of First Industrial, L.P. for the fiscal quarter ended
March 31, 1997, File No. 333-21873)
4.12 Rights Agreement, dated as of September 16, 1997, between the
Company and First Chicago Trust Company of New York, as
Rights Agent (incorporated by reference to Exhibit 99.1 of
Form 8-A12B as filed on September 24, 1997, File No. 1-13102)
4.13 7.60% Notes due 2028 in principal amount of $200 million
issued by First Industrial, L.P. (incorporated by reference
to Exhibit 4.2 of the Form 8-K of First Industrial, L.P.
dated July 15, 1998, File No. 333-21873)
4.14 Supplemental Indenture No. 5, dated as of July 14, 1998,
between First Industrial, L.P. and the U.S. Bank Trust
National Association, relating to First Industrial, L.P.'s
7.60% Notes due July 15, 2008 (incorporated by reference to
Exhibit 4.1 of the Form 8-K of First Industrial, L.P. dated
July 15, 1998, File No. 333-21873)
4.15 7.375% Note due 2011 in principal amount of $200 million
issued by First Industrial, L.P. (incorporated by reference
to Exhibit 4.15 of First Industrial, L.P.'s Annual Report on
Form 10-K for the year ended December 31, 2000, File No.
333-21873)
4.16 Supplemental Indenture No.6, dated as of March 19, 2001,
between First Industrial, L.P. and the U.S. Bank Trust
National Association, relating to First Industrial, L.P.'s
7.375% Notes due March 15, 2011 (incorporated by reference to
Exhibit 4.16 of First Industrial, L.P.'s Annual Report on
Form 10-K for the year ended December 31, 2000, File No.
333-21873)
4.17 Registration Rights Agreement, dated as of March 19, 2001,
among First Industrial, L.P. and Credit Suisse First Boston
Corporation, Chase Securities, Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Salomon Smith Barney, Inc., Banc
of America Securities LLC, Banc One Capital Markets, Inc. and
UBS Warburg LLC (incorporated by reference to Exhibit 4.17 of
First Industrial, L.P.'s Annual Report on Form 10-K for the
year ended December 31, 2000, File No. 333-21873)
4.18 Second Amended and Restated Unsecured Revolving Credit
Agreement, dated as of September 27, 2002, among First
Industrial L.P., First Industrial Realty Trust, Inc., Bank
One, NA and certain other banks (incorporated by reference to
Exhibit 10.1 of the Form 10-Q of the Company for the fiscal
quarter ended September 30, 2002, File No. 1-13102)
4.19 Supplemental Indenture No. 7 dated as of April 15, 2002,
between First Industrial, L.P. and the U.S. Bank National
Association, relating to First Industrial, L.P.'s 6.875%
Notes due 2012 and 7.75% Notes due 2032 (incorporated by
reference to Exhibit 4.1 of the Form 8-K of First Industrial,
L.P. dated April 4, 2002, File No. 333-21873)
4.20 Form of 6.875% Notes due in 2012 in the principal amount of
$200 million issued by First Industrial, L.P. (incorporated
by reference to Exhibit 4.2 of the Form 8-K of First
Industrial, L.P.,
53
Exhibits Description
- -------- -----------
dated April 4, 2002, File No. 333-21873)
4.21 Form of 7.75% Notes due 2032 in the principal amount of $50.0
million issued by First Industrial, L.P. (incorporated by
reference to Exhibit 4.3 of the Form 8-K of First Industrial,
L.P., dated April 4, 2002, File No. 333-21873)
10.1 Sixth Amended and Restated Limited Partnership Agreement of
First Industrial, L.P. (the "LP Agreement"), dated March 18,
1998 (incorporated by reference to Exhibit 10.1 of the
Company's Annual Report on Form 10-K for the year ended
December 31, 1997, File No. 1-13102)
10.2 First Amendment to the L.P. Agreement dated April 1, 1998
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of the Company for the fiscal quarter ended March 31, 1998,
File No. 1-13102)
10.3 Second Amendment to the L.P. Agreement dated April 3, 1998
(incorporated by reference to Exhibit 10.3 of the Form 10-Q
of the Company for the fiscal quarter ended March 31, 1998,
File No. 1-13102)
10.4 Third Amendment to the L.P. Agreement dated April 16, 1998
(incorporated by reference to Exhibit 10.4 of the Form 10-Q
of the Company for the fiscal quarter ended March 31, 1998,
File No. 1-13102)
10.5 Fourth Amendment to the L.P. Agreement dated June 24, 1998
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of the Company for the fiscal quarter ended June 30, 1998,
File No. 1-13102)
10.6 Fifth Amendment to the L.P. Agreement dated July 16, 1998
(incorporated by reference to Exhibit 10.3 of the Form 10-Q
of the Company for the fiscal quarter ended June 30, 1998,
File No. 1-13102)
10.7 Sixth Amendment to the L.P. Agreement dated August 31, 1998
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of the Company for the fiscal quarter ended September 30,
1998, File No. 1-13102)
10.8 Seventh Amendment to the L.P. Agreement dated October 21,
1998 (incorporated by reference to Exhibit 10.3 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 1998, File No. 1-13102)
10.9 Eighth Amendment to the L.P. Agreement dated October 30, 1998
(incorporated by reference to Exhibit 10.4 of the Form 10-Q
of the Company for the fiscal quarter ended September 30,
1998, File No. 1-13102)
10.10 Ninth Amendment to the L.P. Agreement dated November 5, 1998
(incorporated by reference to Exhibit 10.5 of the Form 10-Q
of the Company for the fiscal quarter ended September 30,
1998, File No. 1-13102)
10.11 Tenth Amendment to the L.P. Agreement dated January 28, 2000
(incorporated by reference to Exhibit 10.11 of the Company's
Annual Report on Form 10-K for the year ended December 31,
1999, File No. 1-13102)
10.12 Eleventh Amendment to the L.P. Agreement dated January 28,
2000 (incorporated by reference to Exhibit 10.12 of the
Company's Annual Report on Form 10-K for the year ended
December 31, 1999, File No. 1-13102
10.13 Twelfth Amendment to the L.P. Agreement dated June 27, 2000
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of the Company for the fiscal quarter ended June 30, 2000,
File No. 1-13102)
10.14 Thirteenth Amendment to the L.P. Agreement dated September 1,
2000 (incorporated by reference to Exhibit 10.1 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 2000, File No. 1-13102)
10.15 Fourteenth Amendment to the L.P. Agreement dated October 13,
2000 (incorporated by reference to Exhibit 10.2 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 2000, File No. 1-13102)
10.16 Fifteenth Amendment to the L.P. Agreement dated October 13,
2000 (incorporated by reference to Exhibit 10.3 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 2000, File No. 1-13102)
54
Exhibits Description
- -------- -----------
10.17 Sixteenth Amendment to the L.P. Agreement dated October 27,
2000 (incorporated by reference to Exhibit 10.4 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 2000, File No. 1-13102)
10.18 Seventeenth Amendment to the L.P. Agreement dated January 25,
2001 (incorporated by reference to Exhibit 10.18 of the
Company's Annual Report on Form 10-K for the year ended
December 31, 2000, File No. 1-13102)
10.19 Eighteenth Amendment to the L.P. Agreement dated February 13,
2001 (incorporated by reference to Exhibit 10.19 of the
Company's Annual Report on Form 10-K for the year ended
December 31, 2000, File No. 1-13102)
10.20 Registration Rights Agreement, dated April 29, 1998, relating
to the Company's Common Stock, par value $.01 per share,
between the Company, the Operating Partnership and Merrill
Lynch, Pierce, Fenner & Smith Incorporated (incorporated by
reference to Exhibit 4.1 of the Form 8-K of the Company dated
May 1, 1998, File No. 1-13102)
10.21 Non-Competition Agreement between Jay H. Shidler and First
Industrial Realty Trust, Inc. (incorporated by reference to
Exhibit 10.16 of the Company's Annual Report on Form 10-K for
the year ended December 31, 1994, File No. 1-13102)
10.22 Form of Non-Competition Agreement between each of Michael T.
Tomasz, Paul T. Lambert, Michael J. Havala, Michael W.
Brennan, Michael G. Damone, Duane H. Lund, and Johannson L.
Yap and First Industrial Realty Trust, Inc. (incorporated by
reference to Exhibit 10.14 to the Company's Registration
Statement on Form S-11, File No. 33-77804)
10.23+ 1994 Stock Incentive Plan (incorporated by reference to
Exhibit 10.37 of the Company's Annual Report on Form 10-K for
the year ended December 31, 1994, File No. 1-13102)
10.24+ First Industrial Realty Trust, Inc. Deferred Income Plan
(incorporated by reference to Exhibit 10 of the Form 10-Q of
the Company for the fiscal quarter ended March 31, 1996, File
No. 1-13102)
10.25 Contribution Agreement, dated March 19, 1996, among FR
Acquisitions, Inc. and the parties listed on the signature
pages thereto (incorporated by reference to Exhibit 10.1 of
the Form 8-K of the Company, dated April 3, 1996, File No.
1-13102)
10.26 Contribution Agreement, dated January 31, 1997, among FR
Acquisitions, Inc. and the parties listed on the signature
pages thereto (incorporated by reference to Exhibit 10.58 of
the Company's Annual Report on Form 10-K for the year ended
December 31, 1996, File No. 1-13102)
10.27+ Employment Agreement, dated February 1, 1997, between the
Company and Michael W. Brennan (incorporated by reference to
Exhibit 10.60 of the Company's Annual Report on Form 10-K for
the year ended December 31, 1996, File No. 1-13102)
10.28+ 1997 Stock Incentive Plan (incorporated by reference to
Exhibit 10.62 of the Company's Annual Report on Form 10-K for
the year ended December 31, 1996, File No. 1-13102)
10.29+ Settlement Agreement dated January 31, 2001 between First
Industrial, L.P., First Industrial Realty Trust, Inc. and
Gary H. Heigl (incorporated by reference to Exhibit 10.33 of
the Company's Annual Report on Form 10-K for the year ended
December 31, 2000, File No. 1-13102)
10.30+ 2001 Stock Incentive Plan (incorporated by reference to
Exhibit 10.34 of the Company's Annual Report on Form 10-K for
the year ended December 31, 2001, File No. 1-13102)
10.31 Nineteenth Amendment to the L.P. Agreement, dated June 26,
2002 (incorporated by reference to Exhibit 10.1 of the Form
10-Q of the Company for the fiscal quarter ended June 30,
2002, File No 1-13102)
10.32+ Employment Agreement, dated March 31, 2002, between First
Industrial Realty Trust, Inc. and Michael J. Havala
(incorporated by reference to Exhibit 10.1 of the Form 10-Q
of First Industrial Realty Trust, Inc. for the fiscal quarter
ended March 31, 2002, File No. 1-13102)
10.33+ Employment Agreement, dated March 31, 2002, between First
Industrial Realty Trust, Inc. and Johannson L. Yap
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of First Industrial Realty Trust, Inc. for the fiscal quarter
ended March 31, 2002, File No. 1-13102)
10.34+ Employment Agreement, dated March 25, 2002, between First
Industrial Realty Trust, Inc. and
55
Exhibits Description
- -------- -----------
David P. Draft (incorporated by reference to Exhibit 10.3 of
the Form 10-Q of First Industrial Realty Trust, Inc. for the
fiscal quarter ended March 31, 2002, File No. 1-13102)
12.1* Computation of ratios of earnings to fixed charges and
preferred stock dividends of the Company
21.1* Subsidiaries of the Registrant
23 * Consent of PricewaterhouseCoopers LLP
99.1* Certification pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
* Filed herewith.
+ Indicates a compensatory plan or arrangement contemplated by
Item 14 a (3) of Form 10-K.
(b) REPORTS ON FORM 8-K
None
56
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.
<Table>
FIRST INDUSTRIAL REALTY TRUST, INC.
Date: March 7, 2003 By: /s/ Michael W. Brennan
------------------------------------------------
Michael W. Brennan
President, Chief Executive Officer and Director
(Principal Executive Officer)
Date: March 7, 2003 By: /s/ Michael J. Havala .
------------------------------------------------
Michael J. Havala
Chief Financial Officer
(Principal Financial Officer)
Date: March 7, 2003 By: /s/ Scott A. Musil .
-------------------------------------------------
Scott A. Musil
Senior Vice President, Controller, Treasurer and Assistant Secretary
(Principal Accounting Officer)
</Table>
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.
<Table>
<Caption>
Signature Title Date
- --------- ----- ----
/s/ Jay H. Shidler Chairman of the Board of Directors March 7, 2003
- --------------------------------------
Jay H. Shidler
/s/ Michael W. Brennan President, Chief Executive Officer March 7, 2003
- -------------------------------------- and Director
Michael W. Brennan
/s/ Michael G. Damone Director of Strategic Planning March 7, 2003
- -------------------------------------- and Director
Michael G. Damone
- -------------------------------------- Director
John L. Lesher
/s/ Kevin W. Lynch Director March 7, 2003
- --------------------------------------
Kevin W. Lynch
/s/ John E. Rau Director March 7, 2003
- --------------------------------------
John E. Rau
/s/ Robert J. Slater Director March 7, 2003
- --------------------------------------
Robert J. Slater
/s/ W. Edwin Tyler Director March 7, 2003
- --------------------------------------
W. Edwin Tyler
/s/ J. Steven Wilson Director March 7, 2003
- --------------------------------------
J. Steven Wilson
</Table>
57
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO SECTION 302 OF THE
SARBANES-OXLEY ACT OF 2002
I, Michael W. Brennan, certify that:
1. I have reviewed this annual report on Form 10-K of First Industrial
Realty Trust, Inc.;
2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period
covered by this annual report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
have:
a) designed such disclosure controls and procedures to
ensure that material information relating to the
registrant, including its consolidated subsidiaries,
is made known to us by others within those entities,
particularly during the period in which this annual
report is being prepared;
b) evaluated the effectiveness of the registrant's
disclosure controls and procedures as of a date
within 90 days prior to the filing date of this
annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about
the effectiveness of the disclosure controls and
procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent functions):
a) all significant deficiencies in the design or
operation of internal controls which could adversely
affect the registrant's ability to record, process,
summarize and report financial data and have
identified for the registrant's auditors any material
weaknesses in internal controls; and
b) any fraud, whether or not material, that involves
management or other employees who have a significant
role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
Date: March 19, 2003
/s/ Michael W. Brennan
--------------------------------------
Michael W. Brennan
President and Chief Executive Officer
58
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 302 OF THE
SARBANES-OXLEY ACT OF 2002
I, Michael J. Havala, certify that:
1. I have reviewed this annual report on Form 10-K of First Industrial
Realty Trust, Inc.;
2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period
covered by this annual report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
have:
a) designed such disclosure controls and procedures to
ensure that material information relating to the
registrant, including its consolidated subsidiaries,
is made known to us by others within those entities,
particularly during the period in which this annual
report is being prepared;
b) evaluated the effectiveness of the registrant's
disclosure controls and procedures as of a date
within 90 days prior to the filing date of this
annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about
the effectiveness of the disclosure controls and
procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent functions):
a) all significant deficiencies in the design or
operation of internal controls which could adversely
affect the registrant's ability to record, process,
summarize and report financial data and have
identified for the registrant's auditors any material
weaknesses in internal controls; and
b) any fraud, whether or not material, that involves
management or other employees who have a significant
role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
Date: March 19, 2003
/s/ Michael J. Havala
------------------------------
Michael J. Havala
Chief Financial Officer
59
EXHIBIT INDEX
<Table>
<Caption>
Exhibits Description
- -------- -----------
3.1 Amended and Restated Articles of Incorporation of the
Company (incorporated by reference to Exhibit 3.1 of the
Form 10-Q of the Company for the fiscal quarter ended June
30, 1996, File No. 1-13102)
3.2 Amended and Restated Bylaws of the Company, dated September
4, 1997 (incorporated by reference to Exhibit 1 of the
Company's Form 8-K, dated September 4, 1997, as filed on
September 29, 1997, File No. 1-13102)
3.3 Articles of Amendment to the Company's Articles of
Incorporation, dated June 20, 1994 (incorporated by
reference to Exhibit 3.2 of the Form 10-Q of the Company for
the fiscal quarter ended June 30, 1996, File No. 1-13102)
3.4 Articles of Amendment to the Company's Articles of
Incorporation, dated May 31, 1996 (incorporated by reference
to Exhibit 3.3 of the Form 10-Q of the Company for the
fiscal quarter ended June 30, 1996, File No. 1-13102)
3.5 Articles Supplementary relating to the Company's 8 5/8%
Series C Cumulative Preferred Stock, $.01 par value
(incorporated by reference to Exhibit 4.1 of the Form 8-K of
the Company dated June 6, 1997, File No. 1-13102)
3.6 Articles Supplementary relating to the Company's 7.95%
Series D Cumulative Preferred Stock, $.01 par value
(incorporated by reference to Exhibit 4.1 of the Form 8-K of
the Company dated February 6, 1998, File No. 1-13102)
3.7 Articles Supplementary relating to the Company's 7.90%
Series E Cumulative Preferred Stock, $.01 par value
(incorporated by reference to Exhibit 3.9 of the Company's
Annual Report on Form 10-K for the year ended December 31,
1997, File No. 1-13102)
3.8 Articles Supplementary relating to the Company's Junior
Participating Preferred Stock, $.01 par value (incorporated
by reference to Exhibit 4.10 of Form S-3 of the Company and
First Industrial, L.P. dated September 24, 1997,
Registration No. 333-29879)
4.1 Deposit Agreement, dated June 6, 1997, by and among the
Company, First Chicago Trust Company of New York and holders
from time to time of Depositary Receipts (incorporated by
reference to Exhibit 4.2 of the Form 8-K of the Company,
dated June 6, 1997, File No. 1-13102)
4.2 Deposit Agreement, dated February 6, 1998, by and among the
Company, First Chicago Trust Company of New York and holders
from time to time of Depositary Receipts (incorporated by
reference to Exhibit 4.2 of the Form 8-K of the Company,
dated February 6, 1998, File No. 1-13102)
4.3 Deposit Agreement, dated March 18, 1998, by and among the
Company, First Chicago Trust Company of New York and holders
from time to time of Depositary Receipts (incorporated by
reference to Exhibit 4.12 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-13102)
4.4 Indenture, dated as of May 13, 1997, between First
Industrial, L.P. and First Trust National Association, as
Trustee (incorporated by reference to Exhibit 4.1 of the
Form 10-Q of the Company for the fiscal quarter ended March
31, 1997, as amended by Form 10-Q/A No. 1 of the Company
filed May 30, 1997, File No. 1-13102)
4.5 Supplemental Indenture No. 1, dated as of May 13, 1997,
between First Industrial, L.P. and First Trust National
Association as Trustee relating to $150 million of 7.60%
Notes due 2007 and $100 million of 7.15% Notes due 2027
(incorporated by reference to Exhibit 4.2 of the Form 10-Q
of the Company for the fiscal quarter ended March 31, 1997,
as amended by Form 10-Q/A No. 1 of the Company filed May 30,
1997, File No. 1-13102)
</Table>
60
<Table>
<Caption>
Exhibits Description
- -------- -----------
4.6 Supplemental Indenture No. 2, dated as of May 22, 1997,
between First Industrial, L.P. and First Trust National
Association as Trustee relating to $100 million of 7 3/8%
Notes due 2011(incorporated by reference to Exhibit 4.4 of
the Form 10-Q of First Industrial, L.P. for the fiscal
quarter ended March 31, 1997, File No. 333-21873)
4.7 Supplemental Indenture No. 3 dated October 28, 1997 between
First Industrial, L.P. and First Trust National Association
providing for the issuance of Medium-Term Notes due Nine
Months or more from Date of Issue (incorporated by reference
to Exhibit 4.1 of Form 8-K of First Industrial, L.P., dated
November 3, 1997, as filed November 3, 1997, File No.
333-21873)
4.8 6.90% Medium-Term Note due 2005 in principal amount of $50
million issued by First Industrial, L.P. (incorporated by
reference to Exhibit 4.17 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-13102)
4.9 7.00% Medium-Term Note due 2006 in principal amount of $150
million issued by First Industrial, L.P. (incorporated by
reference to Exhibit 4.18 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-13102)
4.10 7.50% Medium-Term Note due 2017 in principal amount of $100
million issued by First Industrial, L.P. (incorporated by
reference to Exhibit 4.19 of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, File No.
1-13102)
4.11 Trust Agreement, dated as of May 16, 1997, between First
Industrial, L.P. and First Bank National Association, as
Trustee (incorporated by reference to Exhibit 4.5 of the
Form 10-Q of First Industrial, L.P. for the fiscal quarter
ended March 31, 1997, File No. 333-21873)
4.12 Rights Agreement, dated as of September 16, 1997, between
the Company and First Chicago Trust Company of New York, as
Rights Agent (incorporated by reference to Exhibit 99.1 of
Form 8-A12B as filed on September 24, 1997, File No.
1-13102)
4.13 7.60% Notes due 2028 in principal amount of $200 million
issued by First Industrial, L.P. (incorporated by reference
to Exhibit 4.2 of the Form 8-K of First Industrial, L.P.
dated July 15, 1998, File No. 333-21873)
4.14 Supplemental Indenture No. 5, dated as of July 14, 1998,
between First Industrial, L.P. and the U.S. Bank Trust
National Association, relating to First Industrial, L.P.'s
7.60% Notes due July 15, 2008 (incorporated by reference to
Exhibit 4.1 of the Form 8-K of First Industrial, L.P. dated
July 15, 1998, File No. 333-21873)
4.15 7.375% Note due 2011 in principal amount of $200 million
issued by First Industrial, L.P. (incorporated by reference
to Exhibit 4.15 of First Industrial, L.P.'s Annual Report on
Form 10-K for the year ended December 31, 2000, File No.
333-21873)
4.16 Supplemental Indenture No.6, dated as of March 19, 2001,
between First Industrial, L.P. and the U.S. Bank Trust
National Association, relating to First Industrial, L.P.'s
7.375% Notes due March 15, 2011 (incorporated by reference
to Exhibit 4.16 of First Industrial, L.P.'s Annual Report on
Form 10-K for the year ended December 31, 2000, File No.
333-21873)
4.17 Registration Rights Agreement, dated as of March 19, 2001,
among First Industrial, L.P. and Credit Suisse First Boston
Corporation, Chase Securities, Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Salomon Smith Barney, Inc.,
Banc of America Securities LLC, Banc One Capital Markets,
Inc. and UBS Warburg LLC (incorporated by reference to
Exhibit 4.17 of First Industrial, L.P.'s Annual Report on
Form 10-K for the year ended December 31, 2000, File No.
333-21873)
4.18 Second Amended and Restated Unsecured Revolving Credit
Agreement, dated as of September 27, 2002, among First
Industrial L.P., First Industrial Realty Trust, Inc., Bank
One, NA and certain other banks (incorporated by reference
to Exhibit 10.1 of the Form 10-Q of the Company for the
fiscal quarter ended September 30, 2002, File No. 1-13102)
4.19 Supplemental Indenture No. 7 dated as of April 15, 2002,
between First Industrial, L.P. and the U.S. Bank National
Association, relating to First Industrial, L.P.'s 6.875%
Notes due 2012 and 7.75% Notes due 2032 (incorporated by
reference to Exhibit 4.1 of the Form 8-K of First
Industrial, L.P. dated April 4, 2002, File No. 333-21873)
4.20 Form of 6.875% Notes due in 2012 in the principal amount of
$200 million issued by First Industrial, L.P. (incorporated
by reference to Exhibit 4.2 of the Form 8-K of First
Industrial, L.P.,
</Table>
61
<Table>
<Caption>
Exhibits Description
- -------- -----------
dated April 4, 2002, File No. 333-21873)
4.21 Form of 7.75% Notes due 2032 in the principal amount of
$50.0 million issued by First Industrial, L.P. (incorporated
by reference to Exhibit 4.3 of the Form 8-K of First
Industrial, L.P., dated April 4, 2002, File No. 333-21873)
10.1 Sixth Amended and Restated Limited Partnership Agreement of
First Industrial, L.P. (the "LP Agreement"), dated March 18,
1998 (incorporated by reference to Exhibit 10.1 of the
Company's Annual Report on Form 10-K for the year ended
December 31, 1997, File No. 1-13102)
10.2 First Amendment to the L.P. Agreement dated April 1, 1998
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of the Company for the fiscal quarter ended March 31, 1998,
File No. 1-13102)
10.3 Second Amendment to the L.P. Agreement dated April 3, 1998
(incorporated by reference to Exhibit 10.3 of the Form 10-Q
of the Company for the fiscal quarter ended March 31, 1998,
File No. 1-13102)
10.4 Third Amendment to the L.P. Agreement dated April 16, 1998
(incorporated by reference to Exhibit 10.4 of the Form 10-Q
of the Company for the fiscal quarter ended March 31, 1998,
File No. 1-13102)
10.5 Fourth Amendment to the L.P. Agreement dated June 24, 1998
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of the Company for the fiscal quarter ended June 30, 1998,
File No. 1-13102)
10.6 Fifth Amendment to the L.P. Agreement dated July 16, 1998
(incorporated by reference to Exhibit 10.3 of the Form 10-Q
of the Company for the fiscal quarter ended June 30, 1998,
File No. 1-13102)
10.7 Sixth Amendment to the L.P. Agreement dated August 31, 1998
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of the Company for the fiscal quarter ended September 30,
1998, File No. 1-13102)
10.8 Seventh Amendment to the L.P. Agreement dated October 21,
1998 (incorporated by reference to Exhibit 10.3 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 1998, File No. 1-13102)
10.9 Eighth Amendment to the L.P. Agreement dated October 30,
1998 (incorporated by reference to Exhibit 10.4 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 1998, File No. 1-13102)
10.10 Ninth Amendment to the L.P. Agreement dated November 5, 1998
(incorporated by reference to Exhibit 10.5 of the Form 10-Q
of the Company for the fiscal quarter ended September 30,
1998, File No. 1-13102)
10.11 Tenth Amendment to the L.P. Agreement dated January 28, 2000
(incorporated by reference to Exhibit 10.11 of the Company's
Annual Report on Form 10-K for the year ended December 31,
1999, File No. 1-13102)
10.12 Eleventh Amendment to the L.P. Agreement dated January 28,
2000 (incorporated by reference to Exhibit 10.12 of the
Company's Annual Report on Form 10-K for the year ended
December 31, 1999, File No. 1-13102
10.13 Twelfth Amendment to the L.P. Agreement dated June 27, 2000
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of the Company for the fiscal quarter ended June 30, 2000,
File No. 1-13102)
10.14 Thirteenth Amendment to the L.P. Agreement dated September
1, 2000 (incorporated by reference to Exhibit 10.1 of the
Form 10-Q of the Company for the fiscal quarter ended
September 30, 2000, File No. 1-13102)
10.15 Fourteenth Amendment to the L.P. Agreement dated October 13,
2000 (incorporated by reference to Exhibit 10.2 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 2000, File No. 1-13102)
10.16 Fifteenth Amendment to the L.P. Agreement dated October 13,
2000 (incorporated by reference to Exhibit 10.3 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 2000, File No. 1-13102)
</Table>
62
<Table>
<Caption>
Exhibits Description
- -------- -----------
10.17 Sixteenth Amendment to the L.P. Agreement dated October 27,
2000 (incorporated by reference to Exhibit 10.4 of the Form
10-Q of the Company for the fiscal quarter ended September
30, 2000, File No. 1-13102)
10.18 Seventeenth Amendment to the L.P. Agreement dated January
25, 2001 (incorporated by reference to Exhibit 10.18 of the
Company's Annual Report on Form 10-K for the year ended
December 31, 2000, File No. 1-13102)
10.19 Eighteenth Amendment to the L.P. Agreement dated February
13, 2001 (incorporated by reference to Exhibit 10.19 of the
Company's Annual Report on Form 10-K for the year ended
December 31, 2000, File No. 1-13102)
10.20 Registration Rights Agreement, dated April 29, 1998,
relating to the Company's Common Stock, par value $.01 per
share, between the Company, the Operating Partnership and
Merrill Lynch, Pierce, Fenner & Smith Incorporated
(incorporated by reference to Exhibit 4.1 of the Form 8-K of
the Company dated May 1, 1998, File No. 1-13102)
10.21 Non-Competition Agreement between Jay H. Shidler and First
Industrial Realty Trust, Inc. (incorporated by reference to
Exhibit 10.16 of the Company's Annual Report on Form 10-K
for the year ended December 31, 1994, File No. 1-13102)
10.22 Form of Non-Competition Agreement between each of Michael T.
Tomasz, Paul T. Lambert, Michael J. Havala, Michael W.
Brennan, Michael G. Damone, Duane H. Lund, and Johannson L.
Yap and First Industrial Realty Trust, Inc. (incorporated by
reference to Exhibit 10.14 to the Company's Registration
Statement on Form S-11, File No. 33-77804)
10.23+ 1994 Stock Incentive Plan (incorporated by reference to
Exhibit 10.37 of the Company's Annual Report on Form 10-K
for the year ended December 31, 1994, File No. 1-13102)
10.24+ First Industrial Realty Trust, Inc. Deferred Income Plan
(incorporated by reference to Exhibit 10 of the Form 10-Q of
the Company for the fiscal quarter ended March 31, 1996,
File No. 1-13102)
10.25 Contribution Agreement, dated March 19, 1996, among FR
Acquisitions, Inc. and the parties listed on the signature
pages thereto (incorporated by reference to Exhibit 10.1 of
the Form 8-K of the Company, dated April 3, 1996, File No.
1-13102)
10.26 Contribution Agreement, dated January 31, 1997, among FR
Acquisitions, Inc. and the parties listed on the signature
pages thereto (incorporated by reference to Exhibit 10.58 of
the Company's Annual Report on Form 10-K for the year ended
December 31, 1996, File No. 1-13102)
10.27+ Employment Agreement, dated February 1, 1997, between the
Company and Michael W. Brennan (incorporated by reference to
Exhibit 10.60 of the Company's Annual Report on Form 10-K
for the year ended December 31, 1996, File No. 1-13102)
10.28+ 1997 Stock Incentive Plan (incorporated by reference to
Exhibit 10.62 of the Company's Annual Report on Form 10-K
for the year ended December 31, 1996, File No. 1-13102)
10.29+ Settlement Agreement dated January 31, 2001 between First
Industrial, L.P., First Industrial Realty Trust, Inc. and
Gary H. Heigl (incorporated by reference to Exhibit 10.33 of
the Company's Annual Report on Form 10-K for the year ended
December 31, 2000, File No. 1-13102)
10.30+ 2001 Stock Incentive Plan (incorporated by reference to
Exhibit 10.34 of the Company's Annual Report on Form 10-K
for the year ended December 31, 2001, File No. 1-13102)
10.31 Nineteenth Amendment to the L.P. Agreement, dated June 26,
2002 (incorporated by reference to Exhibit 10.1 of the Form
10-Q of the Company for the fiscal quarter ended June 30,
2002, File No 1-13102)
10.32+ Employment Agreement, dated March 31, 2002, between First
Industrial Realty Trust, Inc. and Michael J. Havala
(incorporated by reference to Exhibit 10.1 of the Form 10-Q
of First Industrial Realty Trust, Inc. for the fiscal
quarter ended March 31, 2002, File No. 1-13102)
10.33+ Employment Agreement, dated March 31, 2002, between First
Industrial Realty Trust, Inc. and Johannson L. Yap
(incorporated by reference to Exhibit 10.2 of the Form 10-Q
of First Industrial Realty Trust, Inc. for the fiscal
quarter ended March 31, 2002, File No. 1-13102)
10.34+ Employment Agreement, dated March 25, 2002, between First
Industrial Realty Trust, Inc. and
</Table>
63
<Table>
<Caption>
Exhibits Description
- -------- -----------
David P. Draft (incorporated by reference to Exhibit 10.3 of
the Form 10-Q of First Industrial Realty Trust, Inc. for the
fiscal quarter ended March 31, 2002, File No. 1-13102)
12.1* Computation of ratios of earnings to fixed charges and
preferred stock dividends of the Company
21.1* Subsidiaries of the Registrant
23 * Consent of PricewaterhouseCoopers LLP
99.1* Certification pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
</Table>
* Filed herewith.
+ Indicates a compensatory plan or arrangement contemplated by
Item 14 a (3) of Form 10-K.
64
FIRST INDUSTRIAL REALTY TRUST, INC.
INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULE
<Table>
<Caption>
PAGE
----
FINANCIAL STATEMENTS
Report of Independent Accountants............................................................ F-2
Consolidated Balance Sheets of First Industrial Realty Trust, Inc. (the "Company")
as of December 31, 2002 and 2001............................................................. F-3
Consolidated Statements of Operations and Comprehensive Income of the Company for
the Years Ended December 31, 2002, 2001 and 2000............................................. F-4
Consolidated Statements of Changes in Stockholders' Equity of the Company for the
Years Ended December 31, 2002, 2001 and 2000................................................. F-5
Consolidated Statements of Cash Flows of the Company for the Years Ended
December 31, 2002, 2001 and 2000............................................................. F-6
Notes to Consolidated Financial Statements................................................... F-7
FINANCIAL STATEMENT SCHEDULE
Report of Independent Accountants............................................................ S-1
Schedule III: Real Estate and Accumulated Depreciation...................................... S-2
</Table>
F-1
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholders of
First Industrial Realty Trust, Inc.
In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations and comprehensive income, of changes in
stockholders' equity and of cash flows present fairly, in all material respects,
the financial position of First Industrial Realty Trust, Inc. and its
subsidiaries (the "Company") at December 31, 2002 and 2001, and the results of
their operations and their cash flows for each of the three years in the period
ended December 31, 2002, in conformity with accounting principles generally
accepted in the United States of America. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with auditing standards generally
accepted in the United States of America, which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
As discussed in Note 3 to the consolidated financial statements, on January 1,
2002, the Company adopted the provisions of Statement of Financial Accounting
Standards No. 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets".
PricewaterhouseCoopers LLP
Chicago, Illinois
February 11, 2003
F-2
FIRST INDUSTRIAL REALTY TRUST, INC.
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
<Table>
<Caption>
December 31, December 31,
2002 2001
------------ ------------
ASSETS
Assets:
Investment in Real Estate:
Land .................................................................. $ 415,598 $ 421,828
Buildings and Improvements ............................................ 2,158,082 2,137,666
Furniture, Fixtures and Equipment ..................................... 1,258 1,258
Construction in Progress .............................................. 122,331 154,175
Less: Accumulated Depreciation ........................................ (308,488) (276,820)
------------ ------------
Net Investment in Real Estate ................................. 2,388,781 2,438,107
Real Estate Held For Sale, Net of Accumulated Depreciation and
Amortization of $2,135 at December 31, 2002 and $4,033 at
December 31, 2001 ..................................................... 7,040 30,750
Restricted Cash .......................................................... 31,118 22,764
Tenant Accounts Receivable, Net .......................................... 10,578 11,956
Investments in Joint Ventures ............................................ 12,545 9,010
Deferred Rent Receivable ................................................. 14,277 15,442
Deferred Financing Costs, Net ............................................ 12,927 11,717
Prepaid Expenses and Other Assets, Net ................................... 152,707 81,654
------------ ------------
Total Assets .................................................. $ 2,629,973 $ 2,621,400
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage Loans Payable, Net .............................................. $ 59,989 $ 87,459
Senior Unsecured Debt, Net ............................................... 1,211,860 1,048,491
Unsecured Line of Credit ................................................. 170,300 182,500
Accounts Payable and Accrued Expenses .................................... 72,807 71,031
Rents Received in Advance and Security Deposits .......................... 29,524 26,684
Dividends/Distributions Payable .......................................... 31,106 31,196
------------ ------------
Total Liabilities ............................................. 1,575,586 1,447,361
------------ ------------
Minority Interest ........................................................... 172,061 178,442
Commitments and Contingencies ............................................... -- --
Stockholders' Equity:
Preferred Stock ($.01 par value, 10,000,000 shares authorized,
20,000, 50,000 and 30,000 shares of Series C, D and E
Cumulative Preferred Stock, respectively, issued and
outstanding at December 31, 2002 and December 31, 2001, having
a liquidation preference of $2,500 per share ($50,000), $2,500
per share ($125,000) and $2,500 per share ($75,000),
respectively, as well as 40,000 shares of Series B Cumulative
Preferred Stock issued and outstanding at December 31, 2001,
having a liquidation preference of $2,500 per share
($100,000)) ............................................................. 1 1
Common Stock ($.01 par value, 100,000,000 shares authorized,
41,087,421 and 40,302,287 shares issued and 38,598,321 and
38,904,687 shares outstanding at December 31, 2002 and 2001,
respectively) ........................................................... 411 403
Additional Paid-in-Capital .................................................. 1,124,622 1,197,877
Distributions in Excess of Accumulated Earnings ............................. (158,251) (143,958)
Unearned Value of Restricted Stock Grants ................................... (4,307) (6,247)
Accumulated Other Comprehensive Loss ........................................ (10,559) (12,381)
Treasury Shares, at cost (2,489,100 shares at December 31, 2002
and 1,397,600 shares at December 31, 2001) .............................. (69,591) (40,098)
------------ ------------
Total Stockholders' Equity .................................. 882,326 995,597
------------ ------------
Total Liabilities and Stockholders' Equity .................. $ 2,629,973 $ 2,621,400
============ ============
</Table>
The accompanying notes are an integral part of the financial statements.
F-3
FIRST INDUSTRIAL REALTY TRUST, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
<Table>
<Caption>
Year Ended Year Ended Year Ended
December 31, 2002 December 31, 2001 December 31, 2000
----------------- ----------------- -----------------
Revenues:
Rental Income ................................................. $ 263,720 $ 266,575 $ 278,243
Tenant Recoveries and Other Income ............................ 82,845 84,665 76,946
------------ ------------ ------------
Total Revenues .......................................... 346,565 351,240 355,189
------------ ------------ ------------
Expenses:
Real Estate Taxes ............................................. 50,915 53,652 54,265
Repairs and Maintenance ....................................... 21,796 18,391 16,951
Property Management ........................................... 12,528 12,021 12,612
Utilities ..................................................... 9,122 8,926 9,229
Insurance ..................................................... 2,790 2,012 1,309
Other ......................................................... 9,836 9,364 8,287
General and Administrative .................................... 19,610 18,609 17,129
Interest Expense .............................................. 90,387 82,580 83,925
Amortization of Deferred Financing Costs ...................... 1,925 1,809 1,750
Depreciation and Other Amortization ........................... 74,194 68,307 62,131
Valuation Provision on Real Estate ............................ -- 9,500 2,900
------------ ------------ ------------
Total Expenses ........................................... 293,103 285,171 270,488
------------ ------------ ------------
Income from Continuing Operations Before Equity in Income
(Loss) of Joint Ventures, Income Allocated to Minority
Interest and Gain on Sale of Real Estate ..................... 53,462 66,069 84,701
Equity in Income (Loss) of Joint Ventures ....................... 463 (791) 571
Gain on Sale of Real Estate ..................................... 16,476 64,347 29,296
Minority Interest Allocable to Continuing Operations ............ (7,014) (15,274) (13,280)
------------ ------------ ------------
Income from Continuing Operations ............................... 63,387 114,351 101,288
Income from Discontinued Operations (Including Gain on Sale
of Real Estate of $54,657 for the Year Ended December 31,
2002) ........................................................ 67,062 19,763 19,691
Minority Interest Allocable to Discontinued Operations .......... (10,046) (3,038) (3,115)
------------ ------------ ------------
Net Income Before Extraordinary Loss ............................ 120,403 131,076 117,864
Extraordinary Loss .............................................. (888) (10,309) --
Minority Interest Allocable to Extraordinary Loss ............... 134 1,597 --
------------ ------------ ------------
Net Income ...................................................... 119,649 122,364 117,864
Less: Preferred Stock Dividends ................................. (23,432) (30,001) (32,844)
------------ ------------ ------------
Net Income Available to Common Stockholders ..................... $ 96,217 $ 92,363 $ 85,020
============ ============ ============
Income From Continuing Operations Available to Common
Stockholders Before Extraordinary Loss Per Weighted Average
Common Share Outstanding:
Basic ................................................... $ 1.02 $ 2.15 $ 1.77
============ ============ ============
Diluted ................................................. $ 1.01 $ 2.13 $ 1.76
============ ============ ============
Net Income Available to Common Stockholders Before
Extraordinary Loss Per Weighted Average Common Share
Outstanding:
Basic ................................................... $ 2.47 $ 2.57 $ 2.20
============ ============ ============
Diluted ................................................. $ 2.46 $ 2.56 $ 2.18
============ ============ ============
Net Income Available to Common Stockholders Per Weighted
Average Common Share Outstanding:
Basic ................................................... $ 2.45 $ 2.35 $ 2.20
============ ============ ============
Diluted ................................................. $ 2.44 $ 2.34 $ 2.18
============ ============ ============
Net Income ...................................................... $ 119,649 $ 122,364 $ 117,864
Other Comprehensive Income (Loss):
Cumulative Transition Adjustment ............................. -- (14,920) --
Settlement of Interest Rate Protection Agreements ............ 1,772 (191) --
Mark-to-Market of Interest Rate Protection Agreements ........ (126) (231) --
Write-Off of Unamortized Interest Rate Protection
Agreement Due to the Early Retirement of Debt ........... -- 2,156 --
Amortization of Interest Rate Protection Agreements .......... 176 805 --
------------ ------------ ------------
Comprehensive Income ............................................ $ 121,471 $ 109,983 $ 117,864
============ ============ ============
</Table>
The accompanying notes are an integral part of the financial statements.
F-4
FIRST INDUSTRIAL REALTY TRUST, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
<Table>
<Caption>
Year Ended Year Ended Year Ended
December 31, December 31, December 31,
2002 2001 2000
------------ ------------ ------------
Preferred Stock - Beginning of Year ...................................... $ 1 $ 18 $ 18
Redemption of Series A Preferred Stock ................................... -- (17) --
------------ ------------ ------------
Preferred Stock - End of Year ............................................ $ 1 $ 1 $ 18
============ ============ ============
Common Stock - Beginning of Year ......................................... $ 403 $ 392 $ 382
Net Proceeds from the Issuance of Common Stock ........................ 6 8 5
Issuance of Restricted Stock .......................................... 1 1 3
Repurchase and Retirement of Restricted Stock ......................... (1) (1) --
Conversion of Units to Common Stock ................................... 2 3 2
------------ ------------ ------------
Common Stock - End of Year ............................................... $ 411 $ 403 $ 392
============ ============ ============
Additional Paid-In Capital - Beginning of Year ........................... $ 1,197,877 $ 1,205,435 $ 1,177,364
Net Proceeds from the Issuance of Common Stock ........................ 16,241 18,886 12,764
Issuance of Restricted Stock .......................................... 3,231 3,132 9,686
Repurchase and Retirement of Restricted Stock ......................... (1,694) (1,568) (466)
Amortization of Stock Based Compensation .............................. 646 899 383
Redemption of Series A Preferred Stock ................................ -- (36,701) --
Redemption of Series B Preferred Stock ................................ (96,293) -- --
Conversion of Units to Common Stock ................................... 4,614 7,794 5,704
------------ ------------ ------------
Additional Paid-In Capital - End of Year ................................. $ 1,124,622 $ 1,197,877 $ 1,205,435
============ ============ ============
Dist. in Excess of Accum. Earnings - Beginning of Year ................... $ (143,958) $ (126,962) $ (114,451)
Preferred Stock Dividends ($215.624 per Series C Preferred Share,
$198.748 per Series D Preferred Share and $197.500 per Series E
Preferred Share at December 31, 2002, 2001 and 2000, $81.424,
$218.750 and $218.750 per Series B Preferred Share at December
31, 2002, 2001 and 2000, respectively, and $.652 and $2.375 per
Series A Preferred Share at December 31, 2001 and 2000,
respectively) ...................................................... (23,432) (30,001) (32,844)
Distributions ($2.7250, $2.6525 and $2.5175 per Share/Unit at
December 31, 2002, 2001 and 2000, respectively) .................... (125,785) (123,118) (115,749)
Redemption of Series A Preferred Stock ................................ -- (4,577) --
Redemption of Series B Preferred Stock ................................ (3,148) -- --
Repurchase and Retirement of Restricted Stock ......................... (342) (375) --
Net Income Before Minority Interest ................................... 136,575 139,079 134,259
Minority Interest:
Allocation of Income ............................................... (16,926) (16,715) (16,395)
Distributions ($2.7250, $2.6525 and $2.5175 per Share/Unit at
December 31, 2002, 2001 and 2000, respectively) .................... 18,765 18,711 18,218
------------ ------------ ------------
Dist. in Excess of Accum. Earnings - End of Year ......................... $ (158,251) $ (143,958) $ (126,962)
============ ============ ============
Unearned Value of Rest. Stock Grants - Beginning of Year ................. $ (6,247) $ (8,812) $ (4,087)
Issuance of Restricted Stock .......................................... (3,232) (3,133) (9,689)
Amortization of Restricted Stock Grants ............................... 5,172 5,698 4,964
------------ ------------ ------------
Unearned Value of Rest. Stock Grants - End of Year ....................... $ (4,307) $ (6,247) $ (8,812)
============ ============ ============
Treasury Shares, at cost- Beginning of Year .............................. $ (40,098) $ (11,699) $ --
Purchase of Treasury Shares ........................................... (29,493) (28,399) (11,699)
------------ ------------ ------------
Treasury Shares, at cost - End of Year ................................... $ (69,591) $ (40,098) $ (11,699)
============ ============ ============
Accum. Other Comprehensive Income - Beginning of Year .................... $ (12,381) $ -- $ --
Cumulative Transition Adjustment ...................................... -- (14,920) --
Settlement of Interest Rate Protection Agreements ..................... 1,772 (191) --
Mark-to-Market of Interest Rate Protection Agreements ................. (126) (231) --
Write-Off of Unamortized Interest Rate Protection
Agreement Due to the Early Retirement of Debt ........................ -- 2,156 --
Amortization of Interest Rate Protection Agreements ................... 176 805 --
------------ ------------ ------------
Accum. Other Comprehensive Income - End of Year .......................... $ (10,559) $ (12,381) $ --
============ ============ ============
Total Stockholders' Equity at End of Year ................................ $ 882,326 $ 995,597 $ 1,058,372
============ ============ ============
</Table>
The accompanying notes are an integral part of the financial statements.
F-5
FIRST INDUSTRIAL REALTY TRUST, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)
<Table>
<Caption>
Year Ended Year Ended Year Ended
December 31, December 31, December 31,
2002 2001 2000
------------ ------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income ............................................................. $ 119,649 $ 122,364 $ 117,864
Income Allocated to Minority Interest .................................. 16,926 16,715 16,395
------------ ------------ ------------
Income Before Minority Interest ........................................ 136,575 139,079 134,259
Adjustments to Reconcile Net Income to Net Cash Provided by
Operating Activities:
Depreciation ........................................................ 67,525 65,944 59,840
Amortization of Deferred Financing Costs ............................ 1,925 1,809 1,750
Other Amortization .................................................. 15,295 15,465 10,703
Valuation Provision on Real Estate .................................. -- 9,500 2,900
Equity in (Income) Loss of Joint Ventures ........................... (463) 791 (571)
Distributions from Joint Ventures ................................... 463 -- 571
Gain on Sale of Real Estate ......................................... (71,133) (64,347) (29,296)
Extraordinary Loss .................................................. 888 10,309 --
Increase in Tenant Accounts Receivable and Prepaid Expenses
and Other Assets, Net ............................................ (13,701) (20,438) (23,658)
Increase in Deferred Rent Receivable ................................ (1,947) (3,499) (1,474)
Increase (Decrease) in Accounts Payable and Accrued Expenses and
Rents Received in Advance and Security Deposits .................. (3,728) (6,070) 4,811
(Increase) Decrease in Restricted Cash .............................. (102) (1,452) 406
------------ ------------ ------------
Net Cash Provided by Operating Activities ...................... 131,597 147,091 160,241
------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of and Additions to Investment in Real Estate ................ (337,399) (400,008) (494,084)
Net Proceeds from Sales of Investment in Real Estate ................... 365,687 352,975 407,849
Contributions to and Investments in Joint Ventures ..................... (8,207) (6,025) (37)
Distributions from Joint Ventures ...................................... 2,260 1,524 287
Repayment of Mortgage Loans Receivable ................................. 20,502 9,870 20,954
(Increase) Decrease in Restricted Cash ................................. (8,252) 2,903 (22,269)
------------ ------------ ------------
Net Cash Provided by (Used in) Investing Activities ............ 34,591 (38,761) (87,300)
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net Proceeds from the Issuance of Common Stock ......................... 15,895 18,521 12,478
Repurchase of Restricted Stock ......................................... (2,037) (1,944) (466)
Purchase of Treasury Shares ............................................ (29,493) (28,399) (11,699)
Purchase of U.S. Government Securities ................................. (13,669) (1,123) (1,244)
Proceeds from Senior Unsecured Debt .................................... 247,950 199,390 --
Other Proceeds from Senior Unsecured Debt .............................. 1,772 -- --
Repayments of Senior Unsecured Debt .................................... (84,930) (100,000) --
Redemption of Preferred Stock .......................................... (100,000) (41,295) --
Dividends/Distributions ................................................ (125,875) (122,203) (113,632)
Preferred Stock Dividends .............................................. (23,432) (38,212) (24,633)
Repayments on Mortgage Loans Payable ................................... (39,234) (15,042) (2,300)
Proceeds from Unsecured Lines of Credit ................................ 500,100 398,300 290,200
Repayments on Unsecured Lines of Credit ................................ (512,300) (385,800) (214,200)
Book Overdraft ......................................................... 2,885 10,709 --
Cost of Debt Issuance and Prepayment Fees .............................. (3,820) (8,963) (2,323)
------------ ------------ ------------
Net Cash Used in Financing Activities .......................... (166,188) (116,061) (67,819)
------------ ------------ ------------
Net (Decrease) Increase in Cash and Cash Equivalents ................... -- (7,731) 5,122
Cash and Cash Equivalents, Beginning of Period ......................... -- 7,731 2,609
------------ ------------ ------------
Cash and Cash Equivalents, End of Period ............................... $ -- $ -- $ 7,731
============ ============ ============
</Table>
The accompanying notes are an integral part of the financial statements.
F-6
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
1. ORGANIZATION AND FORMATION OF COMPANY
First Industrial Realty Trust, Inc. was organized in the state of
Maryland on August 10, 1993. First Industrial Realty Trust, Inc. is a real
estate investment trust ("REIT") as defined in the Internal Revenue Code of
1986, as amended (the "Code").
First Industrial Realty Trust, Inc. and its subsidiaries (the
"Company") began operations on July 1, 1994. The Company's operations are
conducted primarily through First Industrial, L.P. (the "Operating Partnership")
of which the Company is the sole general partner. The Company is the sole
stockholder of First Industrial Finance Corporation, First Industrial
Pennsylvania Corporation, First Industrial Harrisburg Corporation, First
Industrial Securities Corporation, First Industrial Mortgage Corporation, First
Industrial Indianapolis Corporation, FI Development Services Corporation and
First Industrial Florida Finance Corporation, which are the sole general
partners of First Industrial Financing Partnership, L.P. (the "Financing
Partnership"), First Industrial Pennsylvania, L.P. (the "Pennsylvania
Partnership"), First Industrial Harrisburg, L.P. (the "Harrisburg Partnership"),
First Industrial Securities, L.P. (the "Securities Partnership"), First
Industrial Mortgage Partnership, L.P. (the "Mortgage Partnership"), First
Industrial Indianapolis, L.P. (the "Indianapolis Partnership"), FI Development
Services, L.P. and TK-SV, LTD., respectively, and the Operating Partnership is
the sole limited partner. The Operating Partnership is also the sole member of
limited liability companies and the sole stockholder of First Industrial
Development Services, Inc. The Company, through separate wholly-owned limited
liability companies of which the Operating Partnership is the sole member, also
owns minority equity interests in, and provides asset and property management
services to the September 1998 Joint Venture (hereinafter defined), the
September 1999 Joint Venture (hereinafter defined) and the December 2001 Joint
Venture (hereinafter defined).
As of December 31, 2002, the Company owned 908 in-service properties
located in 24 states, containing an aggregate of approximately 60.0 million
square feet (unaudited) of gross leasable area ("GLA"). Of the 908 properties
owned by the Company, 755 are held by the Operating Partnership, 19 are held by
the Financing Partnership, 16 are held by the Securities Partnership, 16 are
held by the Mortgage Partnership, 45 are held by the Pennsylvania Partnership,
eight are held by the Harrisburg Partnership, five are held by the Indianapolis
Partnership, one is held by TK-SV, LTD., 19 are held by limited liability
companies of which the Operating Partnership is the sole member and 24 are held
by First Industrial Development Services, Inc.
2. BASIS OF PRESENTATION
First Industrial Realty Trust, Inc. is the sole general partner of the
Operating Partnership, with an approximate 85.0% ownership interest at December
31, 2002. Minority interest at December 31, 2002, represents the approximate
15.0% aggregate partnership interest in the Operating Partnership held by the
limited partners thereof.
The consolidated financial statements of the Company at December 31,
2002 and 2001 and for each of the years ended December 31, 2002, 2001 and 2000
include the accounts and operating results of the Company and its subsidiaries.
Such financial statements present the Company's minority equity interests in the
September 1998 Joint Venture (hereinafter defined), the September 1999 Joint
Venture (hereinafter defined) and the December 2001 Joint Venture (hereinafter
defined) under the equity method of accounting. All significant intercompany
transactions have been eliminated in consolidation.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
In order to conform with generally accepted accounting principles,
management, in preparation of the Company's financial statements, is required to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities as of December
31, 2002 and 2001, and the reported amounts of revenues and expenses for each of
the years ended December 31, 2002, 2001 and 2000. Actual results could differ
from those estimates.
F-7
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Cash and Cash Equivalents
Cash and cash equivalents include all cash and liquid investments with
an initial maturity of three months or less. The carrying amount approximates
fair value due to the short maturity of these investments.
Investment in Real Estate and Depreciation
Purchase accounting has been applied when ownership interests in
properties were acquired for cash. The historical cost basis of properties has
been carried over when certain ownership interests were exchanged for Operating
Partnership units on July 1, 1994 and purchase accounting has been used for all
other properties that were subsequently acquired in exchange for Operating
Partnership units.
Investment in Real Estate is carried at cost. The Company reviews its
properties on a quarterly basis for impairment and provides a provision if
impairments are found. To determine if impairment may exist, the Company reviews
its properties and identifies those that have had either an event of change or
event of circumstances warranting further assessment of recoverability (such as
a decrease in occupancy). If further assessment of recoverability is needed, the
Company estimates the future net cash flows expected to result from the use of
the property and its eventual disposition, on an individual property basis. If
the sum of the expected future net cash flows (undiscounted and without interest
charges) is less than the carrying amount of the property on an individual
property basis, the Company will recognize an impairment loss based upon the
estimated fair value of such property. For properties management considers held
for sale, the Company ceases depreciating the properties and values the
properties at the lower of depreciated cost or fair value, less costs to
dispose. If circumstances arise that were previously considered unlikely, and,
as a result, the Company decides not to sell a property previously classified as
held for sale, the Company will classify such property as held and used. Such
property is measured at the lower of its carrying amount (adjusted for any
depreciation and amortization expense that would have been recognized had the
property been continuously classified as held and used) or fair value at the
date of the subsequent decision not to sell. Properties held for sale at
December 31, 2002 represent properties in which the Company has an executed
contract to sell.
Interest costs, real estate taxes, compensation costs of development
personnel and other directly related costs incurred during construction periods
are capitalized and depreciated commencing with the date placed in service, on
the same basis as the related assets. Depreciation expense is computed using the
straight-line method based on the following useful lives:
<Table>
<Caption>
Years
-----
Buildings and Improvements............................................ 31.5 to 40
Land Improvements..................................................... 15
Furniture, Fixtures and Equipment..................................... 5 to 10
</Table>
Construction expenditures for tenant improvements, leasehold
improvements and leasing commissions (inclusive of compensation costs of leasing
personnel) are capitalized and amortized over the terms of each specific lease.
Repairs and maintenance are charged to expense when incurred. Expenditures for
improvements are capitalized.
Deferred Financing Costs
Deferred financing costs include fees and costs incurred to obtain
long-term financing. These fees and costs are being amortized over the terms of
the respective loans. Accumulated amortization of deferred financing costs was
$7,618 and $5,945 at December 31, 2002 and 2001, respectively. Unamortized
deferred financing costs are written-off when debt is retired before the
maturity date.
Investments in Joint Ventures
Investments in Joint Ventures represents the Company's minority equity
interests in the September 1998 Joint Venture (hereinafter defined), the
September 1999 Joint Venture (hereinafter defined) and the December 2001
F-8
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Joint Venture (hereinafter defined). The Company accounts for its Investments in
Joint Ventures under the equity method of accounting. Under the equity method of
accounting, the Company's share of earnings or losses of the September 1998
Joint Venture (hereinafter defined), the September 1999 Joint Venture
(hereinafter defined) and the December 2001 Joint Venture (hereinafter defined)
is reflected in income as earned and contributions or distributions increase or
decrease, respectively, the Company's Investments in Joint Ventures as paid or
received, respectively.
Employee Benefit Plans
At December 31, 2002, the Company has three stock incentive employee
compensation plans, which are described more fully in Note 12. The restricted
stock awards are accounted for at cost and amortized over their vesting periods.
The Company accounts for its stock incentive plans under the recognition and
measurement principles of Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" ("APB 25"). Under APB 25,
compensation expense is not recognized for options issued in which the strike
price is equal to the fair value of the Company's stock on the date of grant.
Certain options issued in 2000 were issued with a strike price less than the
fair value of the Company's stock on the date of grant. Compensation expense is
being recognized for the intrinsic value of these options determined at the date
of grant over the vesting period.
Had compensation expense for the Company's Stock Incentive Plans been
determined based upon the fair value at the grant date for awards under the
Stock Incentive Plans consistent with the methodology prescribed under Statement
of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation", as amended by FAS 148 (hereinafter defined), net income and
earnings per share would have been the pro forma amounts indicated in the table
below:
<Table>
<Caption>
For the Year Ended
--------------------------------------------
2002 2001 2000
---------- ---------- ----------
Net Income Available to Common Stockholders- as reported ..................... $ 96,217 $ 92,363 $ 85,020
Add: Stock-Based Employee Compensation Expense Included in Net Income
Available to Common Stockholders- as reported ...................... 237 256 297
Less: Total Stock-Based Employee Compensation Expense Determined Under
the Intrinsic Value Method ......................................... (1,154) (786) (945)
---------- ---------- ----------
Net Income Available to Common Stockholders- pro forma ....................... $ 95,300 $ 91,833 $ 84,372
========== ========== ==========
Net Income Available to Common Stockholders per Share- as reported- Basic .... $ 2.45 $ 2.35 $ 2.20
Net Income Available to Common Stockholders per Share- pro forma- Basic ...... $ 2.43 $ 2.34 $ 2.18
Net Income Available to Common Stockholders per Share- as reported- Diluted .. $ 2.44 $ 2.34 $ 2.18
Net Income Available to Common Stockholders per Share- pro forma- Diluted .... $ 2.42 $ 2.32 $ 2.17
The fair value of each option grant is estimated on the date of grant
using the Black-Scholes option pricing model with the following weighted
average assumptions:
Expected dividend yield ................................................... 8.28% 8.22% 8.33%
Expected stock price volatility ........................................... 20.94% 20.75% 20.30%
Risk-free interest rate ................................................... 3.58% 4.91% 6.18%
Expected life of options .................................................. 3.00 3.03 3.05
</Table>
The weighted average fair value of options granted during 2002, 2001 and 2000 is
$1.97, $2.49 and $ 2.91 per option, respectively.
Revenue Recognition
Rental income is recognized on a straight-line method under which
contractual rent increases are recognized evenly over the lease term. Tenant
recovery income includes payments from tenants for taxes, insurance and other
property operating expenses and is recognized as revenue in the same period the
related expenses are incurred by the Company.
F-9
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
The Company provides an allowance for doubtful accounts against the
portion of tenant accounts receivable which is estimated to be uncollectible.
Accounts receivable in the consolidated balance sheets are shown net of an
allowance for doubtful accounts of $2,050 as of December 31, 2002 and December
31, 2001. For accounts receivable the Company deems uncollectible, the Company
uses the direct write-off method.
Gain on Sale of Real Estate
Gain on sale of real estate is recognized using the full accrual
method. Gains relating to transactions which do not meet the full accrual method
of accounting are deferred and recognized when the full accrual method of
accounting criteria are met or by using the installment or deposit methods of
profit recognition, as appropriate in the circumstances. As the assets are sold,
their costs and related accumulated depreciation are removed from the accounts
with resulting gains or losses reflected in net income or loss. Estimated future
costs to be incurred by the Company after completion of each sale are included
in the determination of the gains on sales.
Income Taxes
The Company has elected to be taxed as a REIT under Sections 856
through 860 of the Code. As a result, the Company generally is not subject to
federal income taxation at the corporate level to the extent that it satisfies
the requirements set forth in Section 856 of the Code (pertaining to its
organization and types of income and assets) necessary to maintain its status as
a REIT, and it distributes annually at least 90% of its REIT taxable income (95%
prior to January 1, 2001), as defined in the Code, to its stockholders and
satisfies certain other requirements. Accordingly, no provision has been made
for state or federal income taxes in the accompanying consolidated financial
statements except for activities conducted in its taxable REIT subsidiary, First
Industrial Development Services, Inc. The provision for such state and federal
income taxes has been reflected in gain on sale of real estate or the gain
component of income from discontinued operations in the consolidated statements
of operations and comprehensive income and has not been separately stated due to
its insignificance.
The Company and certain of its subsidiaries are subject to certain
state and local income, excise and franchise taxes. The provision for such state
and local taxes has been reflected in general and administrative expense in the
consolidated statements of operations and comprehensive income and has not been
separately stated due to its insignificance.
For federal income tax purposes, the cash distributions paid to
stockholders may be characterized as ordinary income, return of capital
(generally non-taxable) or capital gains. Distributions paid on common stock for
the year ended December 31, 2002, totaling approximately $107,020, are
characterized 42.16% ($1.1489 per share) as ordinary income, 4.47% ($0.1218 per
share) as short term capital gain, 14.11% ($0.3845 per share) as 20 percent rate
capital gain, 9.23% ($0.2515 per share) as a 25 percent rate capital gain and
30.03% ($0.8183 per share) as return of capital. Of the 14.11% of such dividends
that qualify as 20 percent rate capital gain, 51.67% ($.1987 per share or 7.29
percentage points) qualify as "qualified 5-year gain," to which, for certain
taxpayers, a lower rate will apply. Distributions paid for the year ended
December 31, 2001, totaling approximately $104,407, are characterized 67.7%
($1.80 per share) as ordinary income, 6.1% ($.16 per share) as 20% rate capital
gain, 5.7% ($.15 per share) as a 25% rate capital gain and 20.5% ($.54 per
share) as return of capital. Distributions paid for the year ended December 31,
2000, totaling $97,531, are characterized 91.1% ($2.29 per share) as ordinary
income and 8.9% ($.22 per share) as return of capital.
Earnings Per Common Share
Net income per weighted average share - basic is based on the weighted
average common shares outstanding. Net income per weighted average share -
diluted is based on the weighted average common shares outstanding plus the
effect of in-the-money employee stock options. See Note 10 for further
disclosure about earnings per share.
F-10
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Fair Value of Financial Instruments
The Company's financial instruments include short-term investments,
tenant accounts receivable, net, mortgage notes receivable, accounts payable,
other accrued expenses, mortgage loans payable, unsecured line of credit, senior
unsecured debt and the Put Option (defined hereinafter) issued in conjunction
with an initial offering of certain unsecured debt.
The fair values of the short-term investments, tenant accounts
receivable, net, mortgage notes receivable, accounts payable and other accrued
expenses were not materially different from their carrying or contract values.
See Note 5 for the fair values of the mortgage loans payable, unsecured line of
credit, senior unsecured debt and the Put Option (defined hereinafter) issued in
conjunction with an initial offering of certain unsecured debt.
Derivative Financial Instruments
Historically, the Company has used interest rate protection agreements
(the "Agreements") to fix the interest rate on anticipated offerings of senior
unsecured debt or convert floating rate debt to fixed rate debt. Receipts or
payments that result from the settlement of Agreements used to fix the interest
rate on anticipated offerings of senior unsecured debt are amortized over the
life of the senior unsecured debt. Receipts or payments resulting from
Agreements used to convert floating rate debt to fixed rate debt are recognized
as a component of interest expense. Agreements which qualify for hedge
accounting are marked-to-market and any gain or loss is recognized in other
comprehensive income (shareholders' equity). Any Agreements which no longer
qualify for hedge accounting are marked-to-market and any gain or loss is
recognized in net income immediately. The credit risks associated with the
Agreements are controlled through the evaluation and monitoring of the
creditworthiness of the counterparty. In the event that the counterparty fails
to meet the terms of the Agreements, the Company's exposure is limited to the
current value of the interest rate differential, not the notional amount, and
the Company's carrying value of the Agreements on the balance sheet. See Note 5
for more information on the Agreements.
Discontinued Operations
On January 1, 2002, the Company adopted the Financial Accounting
Standards Board's ("FASB") Statement of Financial Accounting Standards No. 144,
"Accounting for the Impairment or Disposal of Long Lived Assets" ("FAS 144").
FAS 144 addresses financial accounting and reporting for the disposal of long
lived assets. FAS 144 requires that the results of operations and gains or
losses on the sale of property sold subsequent to December 31, 2001 that were
not classified as held for sale at December 31, 2001 as well as the results of
operations from properties that were classified as held for sale subsequent to
December 31, 2001 be presented in discontinued operations if both of the
following criteria are met: (a) the operations and cash flows of the property
have been (or will be) eliminated from the ongoing operations of the Company as
a result of the disposal transaction and (b) the Company will not have any
significant involvement in the operations of the property after the disposal
transaction. FAS 144 also requires prior period results of operations for these
properties to be restated and presented in discontinued operations in prior
consolidated statements of operations.
Segment Reporting
Management views the Company as a single segment.
F-11
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
Recent Accounting Pronouncements
In April 2002, the FASB issued Financial Accounting Standards No. 145,
"Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement
No. 13, and Technical Corrections" ("FAS 145"). FAS 145 rescinds both Statement
of Financial Accounting Standards No. 4, "Reporting Gains and Losses from
Extinguishment of Debt" ("FAS 4"), and the amendment to FAS 4, Statement of
Financial Accounting Standards No. 64, "Extinguishments of Debt Made to Satisfy
Sinking-Fund Requirements". FAS 145 eliminates the requirement that gains and
losses from the extinguishment of debt be aggregated and, if material,
classified as an extraordinary item, net of the related income tax effect,
unless the criteria in Accounting Principles Board Opinion No. 30, "Reporting
the Results of Operations- Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions" are met. FAS 145 is effective for fiscal years beginning after May
15, 2002. In January of 2003, the Company paid off and retired the 1995 Mortgage
Loan (hereinafter defined). As this pay off and retirement was prior to the
stated maturity date of the 1995 Mortgage Loan (hereinafter defined), the
Company wrote off unamortized deferred financing costs in the amount of
approximately $1.5 million. Prior to the issuance of FAS 145, this write off
would have been characterized as extraordinary. Under FAS 145, it is not
considered extraordinary but instead part of continuing operations. For
financial statements issued in 2003 and after, prior period extraordinary losses
due to debt extinguishment will be reclassified as part of continuing
operations. The Company believes that FAS 145 will not have an impact on its
consolidated financial position or liquidity.
In June 2002, the FASB issued Financial Accounting Standards No. 146,
"Accounting for Costs Associated with Exit or Disposal Activities" ("FAS 146").
FAS 146 requires that a liability for a cost associated with an exit or disposal
activity be recognized and measured initially at its fair value in the period in
which the liability is incurred. FAS 146 applies to costs associated with an
exit or disposal activity including, but not limited to, costs to terminate a
contract that is not a capital lease, costs to consolidate facilities or
relocate employees and certain one-time termination benefits provided to current
employees that are involuntarily terminated. FAS 146 is effective for exit or
disposal activities initiated after December 31, 2002. The Company does not
expect FAS 146 to have a material effect on its consolidated financial position,
liquidity, or results of operations.
In November 2002, the FASB issued Financial Accounting Standards
Interpretation No. 45, "Guarantor's Accounting and Disclosure Requirements for
Guarantees, Including Indirect Guarantees of Indebtedness of Others" ("FIN 45").
FIN 45 addresses disclosures to be made by a guarantor in its interim and annual
financial statements about its obligations under guarantees. FIN 45 clarifies
that a guarantor is required to recognize, at the inception of the guarantee, a
liability for the fair value of the obligation undertaken in issuing the
guarantee. In addition, FIN 45 requires footnote disclosure of certain other
information pertaining to guarantees. FIN 45 generally applies to contracts or
indemnification agreements that contingently require the guarantor to make
payments to the guaranteed party based on changes in an underlying variable that
is related to an asset, liability, or an equity security of the guaranteed
party, contracts that contingently require the guarantor to make payments to the
guaranteed party based on another entity's failure to perform under an
obligation agreement, and, in some cases, indirect guarantees of the
indebtedness of others. The disclosure requirements of FIN 45 are effective for
financial statements of interim or annual periods ending after December 15,
2002. The initial recognition and initial measurement provisions are applicable
on a prospective basis to guarantees issued or modified after December 31, 2002.
The Company has adopted the disclosure requirements of FIN 45 as of December 15,
2002 and does not expect the recognition requirements, which are to be applied
on a prospective basis to guarantees issued or modified after December 31, 2002,
to have a material impact on the Company's financial position, liquidity, or
results of operations.
In December 2002, the FASB issued Financial Accounting Standards No.
148, "Accounting for Stock-Based Compensation-Transition and Disclosure" ("FAS
148"). FAS 148 amends Financial Accounting Standards No. 123, "Accounting for
Stock Based Compensation" ("FAS 123"). FAS 148 provides alternative methods of
transition for a voluntary change to the fair value based method of accounting
for stock-based employee compensation. In addition, FAS 148 amends the
disclosure requirements of FAS 123 to require prominent disclosures in both
annual and interim
F-12
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
financial statements about the method of accounting for stock-based employee
compensation and the effect of the method used on reported results. FAS 148 is
effective for financial statements for fiscal years ending after December 15,
2002. The Company is adopting FAS 123, as amended by FAS 148, beginning January
1, 2003 using the Prospective Method of transition as described in FAS 148. The
Company does not expect FAS 148 to have a material effect on its consolidated
financial position, liquidity, or results of operations.
In January 2003, the FASB issued Financial Accounting Standards
Interpretation No. 46, "Consolidation of Variable Interest Entities- an
interpretation of ARB No. 51" ("FIN 46"). FIN 46 addresses consolidation by
business enterprises of special purpose entities ("SPEs") to which the usual
condition for consolidation described in Accounting Research Bulletin No. 51
does not apply because the SPEs have no voting interests or otherwise are not
subject to control through ownership of voting interests. For Variable Interest
Entities created before February 1, 2003, the provisions of FIN 46 are effective
no later than the beginning of the first interim or annual reporting period that
starts after June 15, 2003. For Variable Interest Entities created after January
31, 2003, the provisions of FIN 46 are effective immediately. The Company is
currently assessing the impact of FIN 46 on its consolidated financial position,
liquidity, and results of operations.
Reclassification
Certain 2001 and 2000 items have been reclassified to conform to the
2002 presentation.
4. INVESTMENTS IN JOINT VENTURES
On September 28, 1998, the Company, through a wholly-owned limited
liability company in which the Operating Partnership is the sole member, entered
into a joint venture arrangement (the "September 1998 Joint Venture") with an
institutional investor to invest in industrial properties. The Company, through
wholly-owned limited liability companies of the Operating Partnership, owns a
ten percent equity interest in the September 1998 Joint Venture and provides
property and asset management services to the September 1998 Joint Venture. On
or after October 2000, under certain circumstances, the Company has the right to
purchase all of the properties owned by the September 1998 Joint Venture at a
price to be determined in the future. The Company has not exercised this right.
The Company recognized approximately $1,137, $1,787 and $2,199 (net of the
intercompany elimination) in acquisition, asset management and property
management fees in 2002, 2001 and 2000, respectively, from the September 1998
Joint Venture. For the year ended December 31, 2002, the Company, through a
wholly-owned limited liability company in which the Operating Partnership is the
sole member, received distributions of approximately $313 from the September
1998 Joint Venture. For the year ended December 31, 2001, the Company, through a
wholly-owned limited liability company in which the Operating Partnership is the
sole member, received distributions of approximately $1,167 from the September
1998 Joint Venture. The Company accounts for the September 1998 Joint Venture
under the equity method of accounting. As of December 31, 2002 the September
1998 Joint Venture owned 51 industrial properties comprising approximately 2.6
million square feet (unaudited) of GLA.
On September 2, 1999, the Company, through a wholly-owned limited
liability company in which the Operating Partnership is the sole member, entered
into a joint venture arrangement (the "September 1999 Joint Venture") with an
institutional investor to invest in industrial properties. The Company, through
wholly-owned limited liability companies of the Operating Partnership, owns a
ten percent equity interest in the September 1999 Joint Venture and provides
property and asset management services to the September 1999 Joint Venture. On
or after September 2001, under certain circumstances, the Company has the right
to purchase all of the properties owned by the September 1999 Joint Venture at a
price to be determined in the future. The Company has not exercised this right.
The Company recognized approximately $411, $590 and $557 (net of the
intercompany elimination) in acquisition, asset management and property
management fees in 2002, 2001 and 2000, respectively,
F-13
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
4. INVESTMENTS IN JOINT VENTURES, CONTINUED
from the September 1999 Joint Venture. For the year ended December 31, 2002, the
Company, through a wholly-owned limited liability company in which the Operating
Partnership is the sole member, received distributions of approximately $1,598
from the September 1999 Joint Venture. For the year ended December 31, 2001, the
Company, through a wholly-owned limited liability company in which the Operating
Partnership is the sole member, received distributions of approximately $357
from the September 1999 Joint Venture. The Company accounts for the September
1999 Joint Venture under the equity method of accounting. As of December 31,
2002 the September 1999 Joint Venture owned two industrial properties comprising
approximately .3 million square feet (unaudited) of GLA.
On December 28, 2001, the Company, through a wholly-owned limited
liability company in which the Operating Partnership is the sole member, entered
into a joint venture arrangement (the "December 2001 Joint Venture") with an
institutional investor to invest in industrial properties. The Company, through
wholly-owned limited liability companies of the Operating Partnership, owns a
15% equity interest in the December 2001 Joint Venture and provides property
management services to the December 2001 Joint Venture. The Company recognized
approximately $315 in property management fees in 2002 from the December 2001
Joint Venture. For the year ended December 31, 2002, the Company, through a
wholly-owned limited liability company in which the Operating Partnership is the
sole member, invested approximately $8,207 in the December 2001 Joint Venture
and received distributions of approximately $812 from the December 2001 Joint
Venture. For the year ended December 31, 2001, the Company, through a
wholly-owned limited liability company in which the Operating Partnership is the
sole member, invested approximately $6,025 in the December 2001 Joint Venture.
The Company accounts for the December 2001 Joint Venture under the equity method
of accounting. As of December 31, 2002 the December 2001 Joint Venture had
economic interests in 24 industrial properties comprising approximately 4.3
million square feet (unaudited) of GLA. Twenty-two of the 24 industrial
properties were purchased from the Company. The Company deferred 15% of the gain
resulting from these sales which is equal to the Company's economic interest in
the December 2001 Joint Venture. The 15% gain deferral was netted against the
Company's investment in joint ventures on the balance sheet. The 15% gain
deferral reduced the Company's investment in joint ventures and will be
recognized as gain on sale of real estate when the December 2001 Joint Venture
sells any of the twenty-two properties that the Company sold to the December
2001 Joint Venture to a third party. If the Company repurchases any of the
twenty-two properties that it sold to the December 2001 Joint Venture, the 15%
gain deferral will be netted against the basis of the property purchased (which
reduces the basis of the property).
5. MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND UNSECURED LINES
OF CREDIT
Mortgage Loans Payable, Net
On December 29, 1995 the Company, through the Mortgage Partnership,
borrowed $40,200 under a mortgage loan (the "1995 Mortgage Loan"). In June 2000,
the Company purchased approximately $1.2 million of U.S. Government securities
as substitute collateral to execute a legal defeasance of approximately $1.2
million of the 1995 Mortgage Loan. In March 2001, the Company purchased
approximately $1.1 million of U.S. Government securities as substitute
collateral to execute a legal defeasance of approximately $1.1 million of the
1995 Mortgage Loan. In January 2002, the Company purchased approximately $.8
million of U.S. Government securities as substitute collateral to execute a
legal defeasance of approximately $.8 million of the 1995 Mortgage Loan. In June
2002, the Company purchased approximately $1.9 million of U.S. Government
securities as substitute collateral to execute a legal defeasance of
approximately $1.9 million of the 1995 Mortgage Loan. In December 2002, the
Company purchased approximately $11.1 million of U.S. Government securities as
substitute collateral to execute a legal defeasance of approximately $11.1
million of the 1995 Mortgage Loan. The terms of these legal defeasances require
the Mortgage Partnership to use the gross proceeds from the maturities of the
U.S. Government securities to paydown and subsequently retire the defeased
portion of the 1995 Mortgage Loan in January 2003. Upon the execution of these
legal defeasances, seven properties collateralizing the 1995 Mortgage Loan were
released and subsequently sold. The Company is carrying the defeased portions of
the 1995 Mortgage Loan on its balance sheet until it pays down
F-14
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
5. MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND UNSECURED LINES
OF CREDIT, CONTINUED
and retires the defeased portions of the 1995 Mortgage Loan in January 2003. The
1995 Mortgage Loan provided for monthly principal and interest payments based on
a 28-year amortization schedule and was to mature on January 11, 2026. The
interest rate under the 1995 Mortgage Loan was fixed at 7.22% per annum through
January 11, 2003. After January 11, 2003, the interest rate was to adjust
through a predetermined formula based on the applicable Treasury rate. At
December 31, 2002, the 1995 Mortgage Loan was collateralized by 16 properties
held by the Mortgage Partnership. On January 13, 2003, the Company, through the
Mortgage Partnership, paid off and retired the 1995 Mortgage Loan.
Under the terms of the 1995 Mortgage Loan, certain cash reserves were
required to be and have been set aside for payments of tenant security deposit
refunds, payments of capital expenditures, interest, real estate taxes,
insurance and re-leasing costs. The amount of cash reserves segregated for
security deposits was adjusted as tenants turned over. The amount included in
the cash reserves relating to payments of capital expenditures, interest, real
estate taxes and insurance was determined by the lender and approximated the
next periodic payment of such items. The amount included in the cash reserves
relating to re-leasing costs resulted from a deposit of a lease termination fee
that was to be used to cover costs of re-leasing that space. At December 31,
2002 and 2001, these reserves totaled $2,768 and $2,640, respectively, and are
included in restricted cash. Such cash reserves were invested in a money market
fund at December 31, 2002. The maturity of these investments is one day;
accordingly, cost approximates fair value. On January 13, 2003, the Company,
through the Mortgage Partnership, paid off and retired the 1995 Mortgage Loan at
which time such cash reserves were released to the Company.
On March 20, 1996, the Company, through the Operating Partnership and
the Indianapolis Partnership, entered into a $36,750 mortgage loan (the "CIGNA
Loan") that was collateralized by seven properties in Indianapolis, Indiana and
three properties in Cincinnati, Ohio. The CIGNA Loan bore interest at a fixed
interest rate of 7.50% and provided for monthly principal and interest payments
based on a 25-year amortization schedule. The Company, through the Operating
Partnership, paid off and retired the CIGNA Loan on October 1, 2002 with no
prepayment fee.
On March 20, 1996, the Company, through the Operating Partnership,
assumed a $6,424 mortgage loan and a $2,993 mortgage loan (together, the
"Assumed Loans") that are collateralized by 12 properties in Indianapolis,
Indiana and one property in Indianapolis, Indiana, respectively. The Assumed
Loans bear interest at a fixed rate of 9.25% and provide for monthly principal
and interest payments based on a 16.75-year amortization schedule. The Assumed
Loans mature on January 1, 2013. The Assumed Loans may be prepaid only after
December 1999 in exchange for the greater of a 1% prepayment fee or a yield
maintenance premium.
On January 31, 1997, the Company, through the Operating Partnership,
assumed a loan in the amount of $705 (the "LB Loan II"). The LB Loan II was
interest free until February, 1998, at which time the LB Loan II bore interest
at 8.00% and provided for interest only payments prior to maturity. On June 14,
2002, the Company, through the Operating Partnership, paid off and retired the
LB Loan II with no prepayment fee.
On October 23, 1997, the Company, through the Operating Partnership,
assumed a mortgage loan in the amount of $4,153 (the "Acquisition Mortgage Loan
I"). The Acquisition Mortgage Loan I was collateralized by a property in
Bensenville, Illinois, bore interest at a fixed rate of 8.50% and provided for
monthly principal and interest payments based on a 15-year amortization
schedule. On May 31, 2001, the Company, through the Operating Partnership, paid
off and retired the Acquisition Mortgage Loan I. Due to the retirement of the
Acquisition Mortgage Loan I, the Company recorded an extraordinary loss in 2001
of approximately $128 due to a prepayment fee.
On December 9, 1997, the Company, through the Operating Partnership,
assumed a mortgage loan in the amount of $7,997 (the "Acquisition Mortgage Loan
II"). The Acquisition Mortgage Loan II was collateralized by ten properties in
St. Charles, Louisiana, bore interest at a fixed rate of 7.75% and provided for
monthly principal and
F-15
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
5. MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND UNSECURED LINES
OF CREDIT, CONTINUED
interest payments based on a 22-year amortization schedule. On June 27, 2001,
the Company, through the Operating Partnership, paid off and retired the
Acquisition Mortgage Loan II. Due to the retirement of the Acquisition Mortgage
Loan II, the Company recorded an extraordinary loss in 2001 of approximately
$936 due to a prepayment fee.
On December 23, 1997, the Company, through the Operating Partnership,
assumed a mortgage loan in the amount of $3,598 (the "Acquisition Mortgage Loan
III"). The Acquisition Mortgage Loan III was collateralized by one property in
Houston, Texas, bore interest at a fixed interest rate of 8.875% and provided
for monthly principal and interest payments based on a 20-year amortization
schedule. On December 4, 2002, the Company, through the Operating Partnership,
paid off and retired the Acquisition Mortgage Loan III with no prepayment fee.
On April 16, 1998, the Company, through the Operating Partnership,
assumed a mortgage loan in the principal amount of $2,525 (the "Acquisition
Mortgage Loan IV"). The Acquisition Mortgage Loan IV is collateralized by one
property in Baltimore, Maryland, bears interest at a fixed rate of 8.95% and
provides for monthly principal and interest payments based on a 20-year
amortization schedule. The Acquisition Mortgage Loan IV matures on October 1,
2006. The Acquisition Mortgage Loan IV may be prepaid only after October 2001 in
exchange for the greater of a 1% prepayment fee or a yield maintenance premium.
On July 16, 1998, the Company, through TK-SV, LTD., assumed a mortgage
loan in the principal amount of $2,566 (the "Acquisition Mortgage Loan V"). The
Acquisition Mortgage Loan V is collateralized by one property in Tampa, Florida,
bears interest at a fixed rate of 9.01% and provides for monthly principal and
interest payments based on a 30-year amortization schedule. The Acquisition
Mortgage Loan V matures on September 1, 2006. The Acquisition Mortgage Loan V
may be prepaid only after August 2002 in exchange for the greater of a 1%
prepayment fee or a yield maintenance premium.
On August 31, 1998, the Company, through the Operating Partnership,
assumed a mortgage loan in the principal amount of $965 (the "Acquisition
Mortgage Loan VI"). The Acquisition Mortgage Loan VI was collateralized by one
property in Portland, Oregon, bore interest at a fixed rate of 8.875% and
provided for monthly principal and interest payments based on a 20-year
amortization schedule. On July 2, 2002, the Company, through the Operating
Partnership, paid off and retired the Acquisition Mortgage Loan VI with no
prepayment fee.
On August 31, 1998, the Company, through the Operating Partnership,
assumed a mortgage loan in the principal amount of $1,367 (the "Acquisition
Mortgage Loan VII"). The Acquisition Mortgage Loan VII was collateralized by one
property in Milwaukee, Oregon, bore interest at a fixed rate of 9.75% and
provided for monthly principal and interest payments based on a 25-year
amortization schedule. On December 3, 2001, the Company, through the Operating
Partnership, paid off and retired the Acquisition Mortgage Loan VII with no
prepayment fee.
On April 1, 2002, the Company, through the Operating Partnership,
assumed a mortgage loan in the principal amount of $5,814 (the "Acquisition
Mortgage Loan VIII"). The Acquisition Mortgage Loan VIII is collateralized by
one property in Rancho Dominguez, California, bears interest at a fixed rate of
8.26% and provides for monthly principal and interest payments based on a
22-year amortization schedule. The Acquisition Mortgage Loan VIII matures on
December 1, 2019. The Acquisition Mortgage Loan VIII may be prepaid only after
November 2004 in exchange for the greater of a 1% prepayment fee or yield
maintenance premium.
On April 1, 2002, the Company, through the Operating Partnership,
assumed a mortgage loan in the principal amount of $6,030 (the "Acquisition
Mortgage Loan IX"). The Acquisition Mortgage Loan IX is collateralized by one
property in Rancho Dominguez, California, bears interest at a fixed rate of
8.26% and provides for monthly principal and interest payments based on a
22-year amortization schedule. The Acquisition Mortgage Loan IX matures on
December 1, 2019. The Acquisition Mortgage Loan IX may be prepaid only after
November 2004 in exchange for the greater of a 1% prepayment fee or yield
maintenance premium.
F-16
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
5. MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND UNSECURED LINES
OF CREDIT, CONTINUED
Senior Unsecured Debt, Net
On May 13, 1997, the Company, through the Operating Partnership, issued
$150,000 of senior unsecured debt which matures on May 15, 2007 and bears a
coupon interest rate of 7.60% (the "2007 Notes"). The issue price of the 2007
Notes was 99.965%. Interest is paid semi-annually in arrears on May 15 and
November 15. The Company also entered into an interest rate protection agreement
which was used to fix the interest rate on the 2007 Notes prior to issuance. The
Company settled the interest rate protection agreement for a payment of
approximately $41, which is included in other comprehensive income. The debt
issue discount and the settlement amount of the interest rate protection
agreement are being amortized over the life of the 2007 Notes as an adjustment
to interest expense. The 2007 Notes contain certain covenants including
limitation on incurrence of debt and debt service coverage.
On May 13, 1997, the Company, through the Operating Partnership, issued
$100,000 of senior unsecured debt which matures on May 15, 2027, and bears a
coupon interest rate of 7.15% (the "2027 Notes"). The issue price of the 2027
Notes was 99.854%. The 2027 Notes were redeemable, at the option of the holders
thereof, on May 15, 2002. The Company received redemption notices from holders
representing $84,930 of the 2027 Notes outstanding. On May 15, 2002, the
Company, through the Operating Partnership, paid off and retired $84,930 of 2027
Notes. Due to the partial payoff of the 2027 Notes, the Company has recorded an
extraordinary loss in 2002 of approximately $888 comprised of the amount paid
above the carrying amount of the 2027 notes, the write-off of the pro rata
unamortized deferred financing costs and legal costs. Interest is paid
semi-annually in arrears on May 15 and November 15. The Company also entered
into an interest rate protection agreement which was used to fix the interest
rate on the 2027 Notes prior to issuance. The Company settled the interest rate
protection agreement for approximately $597 of proceeds, which is included in
other comprehensive income. The debt issue discount and the settlement amount of
the interest rate protection agreement are being amortized over the life of the
2027 Notes as an adjustment to interest expense. The 2027 Notes contain certain
covenants including limitation on incurrence of debt and debt service coverage.
On May 22, 1997, the Company, through the Operating Partnership, issued
$100,000 of senior unsecured debt which matures on May 15, 2011 and bears a
coupon interest rate of 7.375% (the "2011 PATS"). The issue price of the 2011
PATS was 99.348%. Interest is paid semi-annually in arrears on May 15 and
November 15. The 2011 PATS are redeemable, at the option of the holder thereof,
on May 15, 2004 (the "Put Option"). The Company received approximately $1,781 of
proceeds from the holder for the Put Option. The Company amortizes the Put
Option amount over the life of the Put Option as an adjustment to interest
expense. The Company also entered into an interest rate protection agreement
which was used to fix the interest rate on the 2011 PATS prior to issuance. The
Company settled the interest rate protection agreement for a payment of
approximately $90, which is included in other comprehensive income. The debt
issue discount and the settlement amount of the interest rate protection
agreement are being amortized over the life of the 2011 PATS as an adjustment to
interest expense. The 2011 PATS contain certain covenants including limitation
on incurrence of debt and debt service coverage.
On November 20, 1997, the Company, through the Operating Partnership,
issued $50,000 of senior unsecured debt which matures on November 21, 2005 and
bears a coupon interest rate of 6.90% (the "2005 Notes"). The issue price of the
2005 Notes was 100%. Interest is paid semi-annually in arrears on May 21 and
November 21. The 2005 Notes contain certain covenants including limitation on
incurrence of debt and debt service coverage.
On December 8, 1997, the Company, through the Operating Partnership,
issued $150,000 of senior unsecured debt which matures on December 1, 2006 and
bears a coupon interest rate of 7.00% (the "2006 Notes"). The issue price of the
2006 Notes was 100%. Interest is paid semi-annually in arrears on June 1 and
December 1. The Company also entered into an interest rate protection agreement
which was used to fix the interest rate on the 2006 Notes prior to issuance. The
Company settled the interest rate protection agreement for a payment of
approximately $2,162, which is included in other comprehensive income. The
settlement amount of the interest rate protection agreement is being amortized
over the life of the 2006 Notes as an adjustment to interest expense. The 2006
Notes contain certain covenants including limitation on incurrence of debt and
debt service coverage.
F-17
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
5. MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND UNSECURED LINES
OF CREDIT, CONTINUED
On December 8, 1997, the Company, through the Operating Partnership,
issued $100,000 of senior unsecured debt which matures on December 1, 2017 and
bears a coupon interest rate of 7.50% (the "2017 Notes"). The issue price of the
2017 Notes was 99.808%. Interest is paid semi-annually in arrears on June 1 and
December 1. The Operating Partnership is amortizing the debt issue discount over
the life of the 2017 Notes as an adjustment to interest expense. The 2017 Notes
contain certain covenants including limitation on incurrence of debt and debt
service coverage.
On March 31, 1998, the Company, through the Operating Partnership,
issued $100,000 of Dealer remarketable securities which were to mature on April
5, 2011 and bore a coupon interest rate of 6.50% (the "2011 Drs."). The issue
price of the 2011 Drs. was 99.753%. The 2011 Drs. were callable at the option of
J.P. Morgan, Inc., as Remarketing Dealer, on April 5, 2001. The Company received
approximately $2,760 of proceeds from the Remarketing Dealer. The Company also
entered into an interest rate protection agreement which was used to fix the
interest rate on the 2011 Drs. prior to issuance. The Company settled the
interest rate protection agreement for a payment of approximately $2,565, which
is included in other comprehensive income. The Remarketing Dealer exercised
its call option with respect to the 2011 Drs. On April 5, 2001, the Company
repurchased and retired the 2011 Drs. from the Remarketing Dealer for
approximately $105,565. In conjunction with the forecasted retirement of the
2011 Drs., the Company entered into an interest rate protection agreement which
fixed the retirement price of the 2011 Drs. which it designated as a cash flow
hedge. On April 2, 2001, this interest rate protection agreement was settled for
a payment of approximately $562. Due to the retirement of the 2011 Drs., the
Company recorded an extraordinary loss in 2001 of approximately $9,245 comprised
of the amount paid above the 2011 Drs. carrying value, the write-off of
unamortized deferred financing costs, the write-off of the unamortized portion
of an interest rate protection agreement which was used to fix the interest rate
on the 2011 Drs. prior to issuance, the settlement of the interest rate
protection agreement as discussed above, legal costs and other expenses.
On July 14, 1998, the Company, through the Operating Partnership,
issued $200,000 of senior unsecured debt which matures on July 15, 2028 and
bears a coupon interest rate of 7.60% (the "2028 Notes"). The issue price of the
2028 Notes was 99.882%. Interest is paid semi-annually in arrears on January 15
and July 15. The Company also entered into interest rate protection agreements
which were used to fix the interest rate on the 2028 Notes prior to issuance.
The Company settled the interest rate protection agreements for a payment of
approximately $11,504, which is included in other comprehensive income. The debt
issue discount and the settlement amount of the interest rate protection
agreements are being amortized over the life of the 2028 Notes as an adjustment
to interest expense. The 2028 Notes contain certain covenants including
limitation on incurrence of debt and debt service coverage. Approximately
$50,000 of the 2028 Notes was purchased, through a broker/dealer, by an entity
in which a Director of the Company owns less than a two percent interest.
On March 19, 2001, the Company, through the Operating Partnership,
issued $200,000 of senior unsecured debt which matures on March 15, 2011 and
bears a coupon interest rate of 7.375% (the "2011 Notes"). The issue price of
the 2011 Notes was 99.695%. Interest is paid semi-annually in arrears on
September 15 and March 15. The Company also entered into an interest rate
protection agreement which was used to fix the interest rate on the 2011 Notes
prior to issuance, which it designated as a cash flow hedge. The Company settled
the interest rate protection agreement for approximately $371 of proceeds, which
is included in other comprehensive income. The debt issue discount and the
settlement amount of the interest rate protection agreement are being amortized
over the life of the 2011 Notes as an adjustment to interest expense. The 2011
Notes contain certain covenants including limitations on incurrence of debt and
debt service coverage.
On April 15, 2002, the Company, through the Operating Partnership,
issued $200,000 of senior unsecured debt which matures on April 15, 2012 and
bears a coupon interest rate of 6.875% (the "2012 Notes"). The issue price of
the 2012 Notes was 99.310%. Interest is paid semi-annually in arrears on April
15 and October 15. The Company also entered into interest rate protection
agreements which were used to fix the interest rate on the 2012 Notes prior to
issuance. The Company settled the interest rate protection agreements for
approximately $1,772 of proceeds, which is included in other comprehensive
income. The debt issue discount and the settlement amount of the interest rate
F-18
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
5. MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND UNSECURED LINES
OF CREDIT, CONTINUED
protection agreements are being amortized over the life of the 2012 Notes as an
adjustment to interest expense. The 2012 Notes contain certain covenants
including limitations on incurrence of debt and debt service coverage.
On April 15, 2002, the Company, through the Operating Partnership,
issued $50,000 of senior unsecured debt which matures on April 15, 2032 and
bears a coupon interest rate of 7.75% (the "2032 Notes"). The issue price of the
2032 Notes was 98.660%. Interest is paid semi-annually in arrears on April 15
and October 15. The debt issue discount is being amortized over the life of the
2032 Notes as an adjustment to interest expense. The 2032 Notes contain certain
covenants including limitations on incurrence of debt and debt service coverage.
Unsecured Lines of Credit
In December 1997, the Company entered into a $300,000 unsecured
revolving credit facility (the "1997 Unsecured Line of Credit") which bore
interest at LIBOR plus .80% or a "Corporate Base Rate" at the Company's
election, and provided for interest only payments until maturity. In June 2000,
the Company amended the 1997 Unsecured Line of Credit which extended the
maturity date to June 30, 2003 and included the right, subject to certain
conditions, to increase the aggregate commitment up to $400,000 (the "2000
Unsecured Line of Credit"). On September 27, 2002, the Company amended and
restated the 2000 Unsecured Line of Credit (the "2002 Unsecured Line of
Credit"). The 2002 Unsecured Line of Credit matures on September 30, 2005 and
bears interest at a floating rate of LIBOR plus .70%, or the Prime Rate, at the
Company's election. The net unamortized deferred financing costs related to the
2000 Unsecured Line of Credit and any additional deferred financing costs
incurred amending the 2002 Unsecured Line of Credit are being amortized over the
life of the 2002 Unsecured Line of Credit in accordance with Emerging Issues
Task Force Issue 98-14, "Debtor's Accounting for Changes in Line-of-Credit or
Revolving-Debt Arrangements". The 2002 Unsecured Line of Credit contains certain
financial covenants relating to debt service coverage, market value net worth,
dividend payout ratio and total funded indebtedness.
In September 2001, the Company entered into two interest rate swap
agreements (together, the "2001 Interest Rate Swap Agreements") which fixed the
interest rate on a portion of the Company's outstanding borrowings on its
unsecured line of credit. The Company designated both of these transactions as
cash flow hedges. The first interest rate swap agreement had a notional value of
$25,000, was effective from October 5, 2001 through October 5, 2002 and fixed
the LIBOR rate at 2.5775%. The second interest rate swap agreement has a
notional value of $25,000 and is effective from October 5, 2001 through July 5,
2003 and fixed the LIBOR rate at 3.0775%. In January 2002 and August 2002, the
Company, through the Operating Partnership, entered into two interest rate swap
agreements (together, the "2002 Interest Rate Swap Agreements") which fixed the
interest rate on a portion of the Company's unsecured line of credit. The
Company designated the 2002 Interest Rate Swap Agreements as cash flow hedges.
The January 2002 interest rate swap agreement has a notional value of $25,000,
is effective from February 4, 2002 through February 4, 2003 and fixed the LIBOR
rate at 2.4975%. The August 2002 interest rate swap agreement has a notional
value of $25,000, is effective from September 5, 2002 through September 5, 2003
and fixed the LIBOR rate at 1.884%. Any payments or receipts from the 2002
Interest Rate Swap Agreements will be treated as a component of interest
expense. The Company anticipates that the 2001 Interest Rate Swap Agreements and
the 2002 Interest Rate Swap Agreements will be highly effective, and, as a
result, the change in value will be shown in other comprehensive income. The
following table discloses information about all of the Company's outstanding
interest rate swap agreements (the "Interest Rate Swap Agreements") at December
31, 2002.
<Table>
<Caption>
Notional Amount Effective Date Maturity Date LIBOR Rate
- ----------------------- --------------------- ---------------------- --------------------
$25,000 October 5, 2001 July 5, 2003 3.0775%
$25,000 February 4, 2002 February 4, 2003 2.4975%
$25,000 September 5, 2002 September 5, 2003 1.884%
</Table>
F-19
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
5. MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND UNSECURED LINES
OF CREDIT, CONTINUED
The following table discloses certain information regarding the
Company's mortgage loans, senior unsecured debt and unsecured lines of credit:
<Table>
<Caption>
OUTSTANDING BALANCE AT ACCRUED INTEREST PAYABLE AT INTEREST RATE AT
------------------------------ ----------------------------- ----------------
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, MATURITY
2002 2001 2002 2001 2002 DATE
------------ ------------ ------------ ------------ ------------ ----------
MORTGAGE LOANS PAYABLE, NET
1995 Mortgage Loan .............. $ 37,482 (1) $ 38,063 $ 158 $ 160 7.220% 1/11/26 (1)
CIGNA Loan ...................... -- 33,214 -- 207 7.500% (7)
Assumed Loans ................... 6,015 6,538 -- -- 9.250% 1/01/13
LB Loan II ...................... -- 705 -- 24 8.000% (2)
Acquisition Mortgage Loan III ... -- 3,065 -- -- 8.875% (10)
Acquisition Mortgage Loan IV .... 2,215 2,286 17 -- 8.950% 10/01/06
Acquisition Mortgage Loan V ..... 2,598 (3) 2,665 (3) 18 -- 9.010% 9/01/06
Acquisition Mortgage Loan VI .... -- 923 (3) -- 7 8.875% (8)
Acquisition Mortgage Loan VIII .. 5,733 -- 39 -- 8.260% 12/01/19
Acquisition Mortgage Loan IX .... 5,946 -- 41 -- 8.260% 12/01/19
------------ ------------ ------------ ------------
Total ........................... $ 59,989 $ 87,459 $ 273 $ 398
============ ============ ============ ============
SENIOR UNSECURED DEBT, NET
2005 Notes ...................... $ 50,000 $ 50,000 $ 383 $ 383 6.900% 11/21/05
2006 Notes ...................... 150,000 150,000 875 875 7.000% 12/01/06
2007 Notes ...................... 149,977 (4) 149,972 (4) 1,457 1,457 7.600% 5/15/07
2011 PATS ....................... 99,610 (4) 99,563 (4) 942 942 7.375% 5/15/11 (5)
2017 Notes ...................... 99,857 (4) 99,847 (4) 625 625 7.500% 12/01/17
2027 Notes ...................... 15,052 (4) 99,877 (4) 138 914 7.150% 5/15/27 (6)
2028 Notes ...................... 199,799 (4) 199,791 (4) 7,009 7,009 7.600% 7/15/28
2011 Notes ...................... 199,502 (4) 199,441 (4) 4,343 4,343 7.375% 3/15/11
2012 Notes ...................... 198,717 (4) -- 2,903 -- 6.875% 4/15/12
2032 Notes ...................... 49,346 (4) -- 818 -- 7.750% 4/15/32
------------ ------------ ------------ ------------
Total ........................... $ 1,211,860 $ 1,048,491 $ 19,493 $ 16,548
============ ============ ============ ============
UNSECURED LINES OF CREDIT
2000 Unsecured Line of Credit ... $ -- $ 182,500 $ -- $ 571 (9) (9)
============ ============ ============ ============
2002 Unsecured Line of Credit ... $ 170,300 $ -- $ 415 $ -- 2.88% 9/30/05
============ ============ ============ ============
</Table>
(1) The entire loan was paid off and retired on January 13, 2003.
(2) On June 14, 2002, the Company paid off and retired the LB Loan II.
(3) At December 31, 2002, the Acquisition Mortgage Loan V is net of an
unamortized premium of $143. At December 31, 2001 the Acquisition Mortgage
Loan V and the Acquisition Mortgage Loan VI are net of unamortized premium
of $180 and $41, respectively.
(4) At December 31, 2002, the 2007 Notes, 2011 PATS, 2017 Notes, 2027 Notes,
2028 Notes, 2011 Notes, 2012 Notes and the 2032 Notes are net of
unamortized discounts of $23, $390, $143, $18, $201, $498, $1,283 and $654,
respectively. At December 31, 2001, the 2007 Notes, 2011 PATS, 2017 Notes,
2027 Notes, 2028 Notes and the 2011 Notes are net of unamortized discounts
of $28, $437, $153, $123, $209 and $559, respectively.
(5) The 2011 PATS are redeemable at the option of the holder thereof, on May
15, 2004.
(6) The 2027 Notes were redeemable at the option of the holders thereof, on May
15, 2002. The Company redeemed $84,930 of the 2027 Notes outstanding on May
15, 2002.
(7) The Company paid off and retired the CIGNA Loan on October 1, 2002.
(8) On July 2, 2002, the Company paid off and retired the Acquisition Mortgage
Loan VI.
(9) The 2000 Unsecured Line of Credit was amended and restated in September
2002.
(10) The Company paid off and retired the Acquisition Mortgage Loan III on
December 4, 2002.
F-20
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
5. MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND UNSECURED LINES
OF CREDIT, CONTINUED
Fair Value
At December 31, 2002 and 2001, the fair value of the Company's mortgage
loans payable, senior unsecured debt, unsecured line of credit and Put Option
were as follows:
<Table>
<Caption>
December 31, 2002 December 31, 2001
------------------------- -------------------------
Carrying Fair Carrying Fair
Amount Value Amount Value
---------- ---------- ---------- ----------
Mortgage Loans Payable ...................... $ 59,989 $ 63,351 $ 87,459 $ 91,280
Senior Unsecured Debt ....................... 1,211,860 1,325,937 1,048,491 1,041,955
Unsecured Line of Credit (Variable Rate) .... 95,300 95,300 132,500 132,500
Unsecured Line of Credit (Fixed Rate) ....... 75,000 75,357 50,000 50,231
Put Option .................................. 350 16,480 604 6,290
---------- ---------- ---------- ----------
Total ....................................... $1,442,499 $1,576,425 $1,319,054 $1,322,256
========== ========== ========== ==========
</Table>
The fair values of the 2005 Notes, 2006 Notes and 2032 Notes were
determined by quoted market prices. The fair values of the Company's remaining
senior unsecured debt, mortgage loans payable, the fixed rate portion of the
unsecured line of credit and Put Option were determined by discounting the
future cash flows using the current rates at which similar loans would be made
to borrowers with similar credit ratings and for the same remaining maturities.
The fair value of the variable rate portion of the unsecured line of credit was
not materially different than its carrying value due to the variable interest
rate nature of the loan.
Other Comprehensive Income
In conjunction with the prior issuances of senior unsecured debt, the
Company entered into interest rate protection agreements to fix the interest
rate on anticipated offerings of senior unsecured debt (the "Interest Rate
Protection Agreements"). In the next 12 months, the Company will amortize
approximately $204 of the Interest Rate Protection Agreements into net income as
an increase to interest expense.
The following is a roll forward of the accumulated other comprehensive
loss balance relating to the Company's derivative transactions:
<Table>
Balance at December 31, 2001................................ $ (12,381)
Settlement of Interest Rate Protection Agreement.......... 1,772
Mark-to-Market of Interest Rate Swap Agreements........... (126)
Amortization of Interest Rate Protection Agreements....... 176
---------
Balance at December 31, 2002................................ $ (10,559)
=========
</Table>
The following is a schedule of the stated maturities and scheduled
principal payments of the mortgage loans, senior unsecured debt and unsecured
line of credit for the next five years ending December 31, and thereafter:
<Table>
<Caption>
Amount
-----------
2003 $ 38,446
2004 1,044
2005 221,441
2006 155,374
2007 151,197
Thereafter 877,714
-----------
Total $ 1,445,216
===========
</Table>
The Company paid off and retired the 1995 Mortgage Loan on January 13,
2003. As a result, the 1995 Mortgage Loan is shown as maturing in 2003.
F-21
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
6. STOCKHOLDERS' EQUITY
Preferred Stock
In 1995, the Company issued 1,650,000 shares of 9.5%, $ .01 par value,
Series A Cumulative Preferred Stock (the "Series A Preferred Stock") at an
initial offering price of $25 per share. On or after November 17, 2000, the
Series A Preferred Stock became redeemable for cash at the option of the
Company, in whole or in part, at $25 per share, or $41,250 in the aggregate,
plus dividends accrued and unpaid to the redemption date. On March 9, 2001, the
Company called for the redemption of all of the outstanding Series A Preferred
Stock at the price of $25 per share, plus accrued and unpaid dividends. The
Company redeemed the Series A Preferred Stock on April 9, 2001 and paid a
prorated second quarter dividend of $.05872 per share, totaling approximately
$97.
On May 14, 1997, the Company issued 4,000,000 Depositary Shares, each
representing 1/100th of a share of the Company's 8 3/4%, $.01 par value, Series
B Cumulative Preferred Stock (the "Series B Preferred Stock"), at an initial
offering price of $25 per Depositary Share. On or after May 14, 2002, the Series
B Preferred Stock became redeemable for cash at the option of the Company, in
whole or in part, at a redemption price equivalent to $25 per Depositary Share,
or $100,000 in the aggregate, plus dividends accrued and unpaid to the
redemption date. On April 12, 2002, the Company called for the redemption of all
of its outstanding Series B Preferred Stock at the price of $25 per Depositary
Share, plus accrued and unpaid dividends. The Company redeemed the Series B
Preferred Stock on May 14, 2002 and paid a prorated second quarter dividend of
$.26736 per Depositary Share, totaling approximately $1,069.
On June 6, 1997, the Company issued 2,000,000 Depositary Shares, each
representing 1/100th of a share of the Company's 8 5/8%, $.01 par value, Series
C Cumulative Preferred Stock (the "Series C Preferred Stock"), at an initial
offering price of $25 per Depositary Share. Dividends on the Series C Preferred
Stock, represented by the Depositary Shares, are cumulative from the date of
initial issuance and are payable quarterly in arrears. With respect to the
payment of dividends and amounts upon liquidation, dissolution or winding up,
the Series C Preferred Stock ranks senior to payments on the Company's Common
Stock and pari passu with the Company's Series D Preferred Stock (hereinafter
defined) and Series E Preferred Stock (hereinafter defined). The Series C
Preferred Stock is not redeemable prior to June 6, 2007. On or after June 6,
2007, the Series C Preferred Stock is redeemable for cash at the option of the
Company, in whole or in part, at a redemption price equivalent to $25 per
Depositary Share, or $50,000 in the aggregate, plus dividends accrued and unpaid
to the redemption date. The Series C Preferred Stock has no stated maturity and
is not convertible into any other securities of the Company.
On February 4, 1998, the Company issued 5,000,000 Depositary Shares,
each representing 1/100th of a share of the Company's 7.95%, $.01 par value,
Series D Cumulative Preferred Stock (the "Series D Preferred Stock"), at an
initial offering price of $25 per Depositary Share. Dividends on the Series D
Preferred Stock represented by the Depositary Shares are cumulative from the
date of initial issuance and are payable quarterly in arrears. With respect to
the dividends and amounts upon liquidation, dissolution or winding up, the
Series D Preferred Stock ranks senior to payments on the Company's Common Stock
and pari passu with the Company's Series C Preferred Stock and Series E
Preferred Stock (hereinafter defined). The Series D Preferred Stock is not
redeemable prior to February 4, 2003. On or after February 4, 2003, the Series D
Preferred Stock is redeemable for cash at the option of the Company, in whole or
in part, at a redemption price equivalent to $25 per Depositary Share, or
$125,000 in the aggregate, plus dividends accrued and unpaid to the redemption
date. The Series D Preferred Stock has no stated maturity and is not convertible
into any other securities of the Company.
On March 18, 1998, the Company issued 3,000,000 Depositary Shares, each
representing 1/100th of a share of the Company's 7.90%, $.01 par value, Series E
Cumulative Preferred Stock (the "Series E Preferred Stock"), at an initial
offering price of $25 per Depositary Share. Dividends on the Series E Preferred
Stock represented by the Depositary Shares are cumulative from the date of
initial issuance and are payable quarterly in arrears. With respect to the
payment of dividends and amounts upon liquidation, dissolution or winding up,
the Series E Preferred Stock ranks senior to payments on the Company's Common
Stock and pari passu with the Company's Series C
F-22
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
6. STOCKHOLDERS' EQUITY, CONTINUED
Preferred Stock and Series D Preferred Stock. The Series E Preferred Stock is
not redeemable prior to March 18, 2003. On or after March 18, 2003, the Series E
Preferred Stock is redeemable for cash at the option of the Company, in whole or
in part, at a redemption price equivalent to $25 per Depositary Share, or
$75,000 in the aggregate, plus dividends accrued and unpaid to the redemption
date. The Series E Preferred Stock has no stated maturity and is not convertible
into any other securities of the Company.
The following table summarizes certain information regarding the
Company's preferred stock:
<Table>
<Caption>
Stated Value at
------------------------------
Initial Optional
December 31, December 31, Dividend Redemption
2002 2001 Rate Date
------------ ------------ -------- ----------
Series B Preferred Stock $ -- $ 100,000 8.750% (1)
Series C Preferred Stock 50,000 50,000 8.625% 6/06/07
Series D Preferred Stock 125,000 125,000 7.950% 2/04/03
Series E Preferred Stock 75,000 75,000 7.900% 3/18/03
------------ ------------
Total $ 250,000 $ 350,000
============ ============
</Table>
(1) The Company redeemed the Series B Preferred Stock on May 14, 2002.
Non-Qualified Employee Stock Options
For the year ended December 31, 2002 certain employees of the Company
exercised 561,418 non-qualified employee stock options. Gross proceeds to the
Company were approximately $15,895.
For the year ended December 31, 2001 certain employees of the Company
exercised 717,836 non-qualified employee stock options. Gross proceeds to the
Company were approximately $18,521.
For the year ended December 31, 2000 certain employees of the Company
exercised 518,550 non-qualified employee stock options. Gross proceeds to the
Company were approximately $12,478.
Treasury Stock:
In March 2000, the Company's Board of Directors approved the repurchase
of up to $100,000 of the Company's common stock. The Company may make purchases
from time to time, if price levels warrant, in the open market or in privately
negotiated transactions. During the year ended December 31, 2002, the Company
repurchased 1,091,500 shares of its common stock at a weighted average price of
approximately $27.02 per share. During the year ended December 31, 2001, the
Company repurchased 1,003,300 shares of its common stock at a weighted average
price of approximately $28.30 per share. During the year ended December 31,
2000, the Company repurchased 394,300 shares of its common stock at a weighted
average price of approximately $29.67 per share.
F-23
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
6. STOCKHOLDERS' EQUITY, CONTINUED
Shareholders' Rights Plan
On September 4, 1997, the Board of Directors of the Company declared a
dividend distribution of one Preferred Share Purchase Right ("Right") for each
outstanding share of Common Stock. The dividend distribution was made on October
20, 1997 to stockholders of record as of the close of business on October 19,
1997. In addition, a Right will attach to each share of Common Stock issued in
the future. Each Right entitles the registered holder to purchase from the
Company one one-hundredth of a share of Junior Participating Preferred Stock
(the "Junior Preferred Stock"), at a price of $125 per one one-hundredth of a
share (the "Purchase Price"), subject to adjustment. The Rights become
exercisable only if a person or group of affiliated or associated persons (an
"Acquiring Person") acquires, or obtains the right to acquire, beneficial
ownership of Common Stock or other voting securities ("Voting Stock") that have
15% or more of the voting power of the outstanding shares of Voting Stock, or if
an Acquiring Person commences or makes an announcement of an intention to
commence a tender offer or exchange offer to acquire beneficial ownership of
Voting Stock that have 15% or more of the voting power of the outstanding shares
of Voting Stock. The Rights will expire on October 19, 2007, unless redeemed
earlier by the Company at $.001 per Right, or exchanged by the Company at an
exchange ratio of one share of Common Stock per Right.
In the event that a person becomes an Acquiring Person, each holder of
a Right, other than the Acquiring Person, is entitled to receive, upon exercise,
(1) Common Stock having a value equal to two times the Purchase Price of the
Right or (2) common stock of the acquiring company having a value equal to two
times the Purchase Price of the Right.
The Junior Preferred Stock ranks junior to all other series of the
Company's preferred stock with respect to payment of dividends and as to
distributions of assets in liquidation. Each share of Junior Preferred Stock has
a quarterly dividend rate per share equal to the greater of $1.00 or 100 times
the per share amount of any dividend (other than a dividend payable in shares of
Common Stock or a subdivision of the Common Stock) declared on the Common Stock,
subject to certain adjustments. In the event of liquidation, the holder of the
Junior Preferred Stock is entitled to receive a preferred liquidation payment
per share of $1.00 (plus accrued and unpaid dividends) or, if greater, an amount
equal to 100 times the payment to be made per share of Common Stock, subject to
certain adjustments.
Dividends/Distributions
The following table summarizes dividends/distributions for the past
three years:
<Table>
<Caption>
Year Ended 2002 Year Ended 2001 Year Ended 2000
---------------------------- ---------------------------- ----------------------------
Dividend/ Dividend/ Dividend/
Distribution Total Distribution Total Distribution Total
per Share/ Dividend/ per Share/ Dividend/ per Share/ Dividend/
Unit Distribution Unit Distribution Unit Distribution
------------ ------------ ------------ ------------ ------------ ------------
Common Stock/Operating Partnership Units $ 2.7250 $ 125,785 $ 2.65250 $ 123,118 $ 2.51750 $ 115,749
Series A Preferred Stock $ -- $ -- $ .65247 $ 1,077 $ 2.37500 $ 3,920
Series B Preferred Stock $ 81.424 $ 3,260 $ 218.75000 $ 8,752 $ 218.75000 $ 8,752
Series C Preferred Stock $ 215.62400 $ 4,312 $ 215.62400 $ 4,312 $ 215.62400 $ 4,312
Series D Preferred Stock $ 198.74800 $ 9,936 $ 198.74800 $ 9,936 $ 198.74800 $ 9,936
Series E Preferred Stock $ 197.50000 $ 5,924 $ 197.50000 $ 5,924 $ 197.50000 $ 5,924
</Table>
F-24
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
7. ACQUISITION AND DEVELOPMENT OF REAL ESTATE
In 2002, the Company acquired 90 in-service industrial properties
comprising, in the aggregate, approximately 5.7 million square feet (unaudited)
of GLA and several land parcels for a total purchase price of approximately
$239,408, excluding costs incurred in conjunction with the acquisition of the
properties. Twenty-one of the 90 industrial properties acquired, comprising
approximately .6 million square feet (unaudited) of GLA, were acquired from the
September 1998 Joint Venture for an aggregate purchase price of approximately
$19,340. Eight of the 90 industrial properties acquired, comprising
approximately .2 million square feet (unaudited) of GLA, were acquired from the
September 1999 Joint Venture for an aggregate purchase price of approximately
$13,000. The Company also completed the development of 17 properties comprising
approximately 3.2 million square feet (unaudited) of GLA at a cost of
approximately $116,806.
In 2001, the Company acquired 79 in-service industrial properties
comprising, in the aggregate, approximately 4.4 million square feet (unaudited)
of GLA and several land parcels for a total purchase price of approximately
$227,514. Two of the 79 industrial properties acquired, comprising approximately
..1 million square feet (unaudited) of GLA, were acquired from the September 1998
Joint Venture for an aggregate purchase price of approximately $5,845. The
Company also completed the development of seven properties comprising
approximately 1.1 million square feet (unaudited) of GLA at a cost of
approximately $47,991.
In 2000, the Company acquired 83 in-service industrial properties and
one industrial property under redevelopment comprising, in the aggregate,
approximately 5.8 million square feet (unaudited) of GLA and several land
parcels for a total purchase price of approximately $323,529 and completed the
development of 26 properties and two redevelopments comprising approximately 4.1
million square feet (unaudited) of GLA at a cost of approximately $147,954.
8. SALE OF REAL ESTATE AND REAL ESTATE HELD FOR SALE
In 2002, the Company sold 86 industrial properties comprising
approximately 8.5 million square feet (unaudited) of GLA that were not
classified as held for sale at December 31, 2001, 12 properties comprising
approximately .9 million square feet (unaudited) of GLA that were classified as
held for sale at December 31, 2001, 16 properties comprising approximately 2.5
million square feet (unaudited) of GLA that were sold to the December 2001 Joint
Venture, several land parcels and assigned to third parties the right to
purchase certain properties. Gross proceeds from these sales were approximately
$473,511. The gain on sale of real estate was approximately $71,133, of which
$54,657 is shown in discontinued operations. In accordance with FAS 144, the
results of operations and gain on sale of real estate for the 86 of the 114 sold
properties that were not identified as held for sale at December 31, 2001 and
the gain associated with the assignment to third parties of the right to
purchase certain properties are included in discontinued operations.
In 2001, the Company sold 132 industrial properties and several land
parcels. The aggregate gross sales price of these sales totaled approximately
$386,939. The Company also recognized gains in 2001 on prior period sales where
the gains were previously deferred. The gain on sales totaled approximately
$64,347.
In 2000, the Company sold 109 industrial properties and several land
parcels. The aggregate gross sales price of these sales totaled approximately
$433,713. The gain on sales totaled approximately $29,296.
In conjunction with certain property sales, the Company provided seller
financing on behalf of certain buyers. At December 31, 2002, the Company had
mortgage notes receivable outstanding of approximately $84,675, which is
included as a component of prepaid expenses and other assets. At December 31,
2001, the Company had mortgage notes receivable outstanding of approximately
$27,243, which is included as a component of prepaid expenses and other assets.
F-25
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
8. SALE OF REAL ESTATE AND REAL ESTATE HELD FOR SALE, CONTINUED
At December 31, 2002, the Company had four industrial properties
comprising approximately .3 million square feet of GLA held for sale. Net
carrying value of the industrial properties held for sale at December 31, 2002
is approximately $7,040. In accordance with FAS 144, the results of operations
of the four properties identified as held for sale during 2002 are included in
discontinued operations. There can be no assurance that such properties held for
sale will be sold.
The following table discloses certain information regarding the four
industrial properties held for sale by the Company.
<Table>
<Caption>
YEAR ENDED
------------------------------------------
2002 2001 2000
---------- ---------- ----------
Total Revenues $ 1,891 $ 1,972 $ 1,682
Operating Expenses (719) (696) (603)
Depreciation and Amortization (220) (223) (197)
---------- ---------- ----------
Income from Operations $ 952 $ 1,053 $ 882
========== ========== ==========
</Table>
In connection with the Company's periodic review of the carrying values
of its properties and due to the continuing softness of the economy in certain
of its markets and indications of current market values for comparable
properties, the Company determined in the fourth quarter of 2001 that an
impairment valuation in the amount of approximately $9,500 should be recorded
for certain properties located in the Columbus, Ohio, Des Moines, Iowa and
Indianapolis, Indiana markets.
In the fourth quarter of 2000, the Company recognized a valuation
provision on real estate of approximately $2,900 relating to properties located
in Grand Rapids, Michigan. The fair value was determined by a quoted market
price less transaction costs.
9. SUPPLEMENTAL INFORMATION TO STATEMENTS OF CASH FLOWS
Supplemental disclosure of cash flow information:
<Table>
<Caption>
Year Ended Year Ended Year Ended
December 31, 2002 December 31, 2001 December 31, 2000
----------------- ----------------- -----------------
Interest paid, net of capitalized
interest ............................. $ 87,723 $ 80,577 $ 83,213
================= ================= =================
Interest capitalized ................... $ 7,792 $ 9,950 $ 5,203
================= ================= =================
Supplemental schedule of noncash
investing and financing activities:
Distribution payable on common
Stock/units .......................... $ 31,106 $ 31,196 $ 30,281
================= ================= =================
Distribution payable on preferred
Stock ................................ $ -- $ -- $ 8,211
================= ================= =================
Exchange of units for common shares:
Minority interest ...................... $ (4,616) $ (7,797) $ (5,706)
Common stock ........................... 2 3 2
Additional paid in capital ............. 4,614 7,794 5,704
----------------- ----------------- -----------------
$ -- $ -- $ --
================= ================= =================
In conjunction with the property and
land acquisitions, the following
assets and liabilities were assumed:
Purchase of real estate ................ $ 239,408 $ 227,514 $ 323,529
Operating partnership units ............ (633) (1,491) (3,474)
Accounts payable and
Accrued expenses ................... (2,504) (2,153) (3,869)
Mortgage Debt .......................... (11,844) -- --
----------------- ----------------- -----------------
Acquisition of real estate ............. $ 224,427 $ 223,870 $ 316,186
================= ================= =================
In conjunction with certain property
sales, the Company provided seller
financing on behalf of certain
buyers:
Notes Receivable ....................... $ 78,227 $ 12,460 $ 7,749
================= ================= =================
</Table>
F-26
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
10. EARNINGS PER SHARE ("EPS")
The computation of basic and diluted EPS is presented below.
<Table>
<Caption>
Year Ended Year Ended Year Ended
December 31, December 31, December 31,
2002 2001 2000
------------ ------------ ------------
Numerator:
Income from Continuing Operations ...................... $ 63,387 $ 114,351 $ 101,288
Less: Preferred Stock Dividends ........................ (23,432) (30,001) (32,844)
------------ ------------ ------------
Income from Continuing Operations Available to
Common Stockholders, Net of Minority Interest
-For Basic and Diluted EPS .......................... 39,955 84,350 68,444
Discontinued Operations, Net of Minority Interest ...... 57,016 16,725 16,576
------------ ------------ ------------
Net Income Available to Common Stockholders Before
Extraordinary Loss-For Basic and Diluted EPS .......... 96,971 101,075 85,020
Extraordinary Loss, Net of Minority Interest ........... (754) (8,712) --
------------ ------------ ------------
Net Income Available to Common Stockholders
-For Basic and Diluted EPS ............................. $ 96,217 $ 92,363 $ 85,020
============ ============ ============
Denominator:
Weighted Average Shares - Basic ....................... 39,251,207 39,273,724 38,660,516
Effect of Dilutive Securities:
Employee and Director Common Stock Options ............ 201,868 278,527 256,069
------------ ------------ ------------
Weighted Average Shares- Diluted ...................... 39,453,075 39,552,251 38,916,585
============ ============ ============
Basic EPS:
Income from Continuing Operations Available to
Common Stockholders, Net of Minority Interest ....... $ 1.02 $ 2.15 $ 1.77
============ ============ ============
Discontinued Operations, Net of Minority Interest ..... $ 1.45 $ .42 $ .43
============ ============ ============
Net Income Available to Common Stockholders Before
Extraordinary Loss ................................. $ 2.47 $ 2.57 $ 2.20
============ ============ ============
Extraordinary Loss, Net of Minority Interest .......... $ (.02) $ (.22) $ --
============ ============ ============
Net Income Available to Common Stockholders ........... $ 2.45 $ 2.35 $ 2.20
============ ============ ============
Diluted EPS:
Income from Continuing Operations Available to
Common Stockholders, Net of Minority Interest ....... $ 1.01 $ 2.13 $ 1.76
============ ============ ============
Discontinued Operations, Net of Minority Interest ..... $ 1.45 $ .42 $ .42
============ ============ ============
Net Income Available to Common Stockholders Before
Extraordinary Loss ................................. $ 2.46 $ 2.56 $ 2.18
============ ============ ============
Extraordinary Loss, Net of Minority Interest .......... $ (.02) $ (.22) $ --
============ ============ ============
Net Income Available to Common Stockholders ........... $ 2.44 $ 2.34 $ 2.18
============ ============ ============
</Table>
F-27
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
11. FUTURE RENTAL REVENUES
The Company's properties are leased to tenants under net and semi-net
operating leases. Minimum lease payments receivable, excluding tenant
reimbursements of expenses, under noncancelable operating leases in effect as of
December 31, 2002 are approximately as follows:
<Table>
2003 $ 242,083
2004 181,295
2005 127,118
2006 84,517
2007 56,361
Thereafter 89,421
------------
Total $ 780,795
============
</Table>
12. EMPLOYEE BENEFIT PLANS
The Company maintains three stock incentive plans (the "Stock Incentive
Plans") which are administered by the Compensation Committee of the Board of
Directors. There are approximately 10.0 million shares reserved under the Stock
Incentive Plans. Only officers and other employees of the Company and its
affiliates generally are eligible to participate in the Stock Incentive Plans.
However, Independent Directors of the Company have received automatic annual
grants of options to purchase 10,000 shares at a per share exercise price equal
to the fair market value of a share on the date of grant.
The Stock Incentive Plans authorize (i) the grant of stock options that
qualify as incentive stock options under Section 422 of the Code, (ii) the grant
of stock options that do not so qualify, (iii) restricted stock awards, (iv)
performance share awards and (v) dividend equivalent rights. The exercise price
of the stock options is determined by the Compensation Committee. Special
provisions apply to awards granted under the Stock Incentive Plans in the event
of a change in control in the Company. As of December 31, 2002, stock options
and restricted stock covering 4.0 million shares were outstanding and 3.6
million shares were available under the Stock Incentive Plans. The outstanding
stock options generally vest over one to three year periods and have lives of
ten years. Stock option transactions are summarized as follows:
<Table>
<Caption>
Weighted Average
Exercise Price per Exercise Price
Shares Share per Share
---------- ------------------ ----------------
Outstanding at December 31, 1999 .... 2,776,267 $ 27.04 $18.25-$31.125
Granted ........................ 937,250 $ 27.34 $27.125-$30.00
Exercised or Converted ......... (605,550) $ 24.58 $18.25-$31.125
Expired or Terminated .......... (84,500) $ 28.63 $25.125-$31.125
----------
Outstanding at December 31, 2000 .... 3,023,467 $ 27.61 $18.25-$31.125
Granted ........................ 1,030,900 $ 32.98 $31.05-$33.125
Exercised ...................... (717,836) $ 25.99 $20.25-$31.125
Expired or Terminated .......... (387,086) $ 30.13 $21.125-$33.125
----------
Outstanding at December 31, 2001 .... 2,949,445 $ 29.55 $18.25-$33.125
Granted ........................ 945,600 $ 30.72 $30.53-$33.15
Exercised ...................... (561,418) $ 28.32 $22.75-$33.125
Expired or Terminated .......... (190,992) $ 30.52 $25.125-$33.125
----------
Outstanding at December 31, 2002 .... 3,142,635 $ 30.06 $18.25-$33.15
==========
</Table>
F-28
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
12. EMPLOYEE BENEFIT PLANS, CONTINUED
The following table summarizes currently outstanding and exercisable
options as of December 31, 2002:
<Table>
<Caption>
Options Outstanding Options Exercisable
-------------------------------------------------- ------------------------------
Weighted
Average Weighted Weighted
Number Remaining Average Number Average
Range of Exercise Price Outstanding Contractual Life Exercise Price Exercisable Exercise Price
- --------------------------- ------------ ---------------- -------------- ------------ --------------
$18.25-$27.69 782,352 5.88 $25.61 658,098 $25.31
$30.00-$33.15 2,360,283 7.73 $31.54 944,763 $31.43
</Table>
In September 1994, the Board of Directors approved and the Company
adopted a 401(k)/Profit Sharing Plan. Under the Company's 401(k)/Profit Sharing
Plan, all eligible employees may participate by making voluntary contributions.
The Company may make, but is not required to make, matching contributions. For
the years ended December 31, 2002, 2001 and 2000, the Company made matching
contributions of approximately $99, $220 and $211, respectively. In March 1996,
the Board of Directors approved and the Company adopted a Deferred Income Plan.
At December 31, 2002, 1,118,233 units were outstanding.
During 2002, the Company awarded 90,260 shares of restricted Common
Stock to certain employees and 3,720 shares of restricted Common Stock to
certain Directors. These restricted shares of Common Stock had a fair value of
approximately $3,232 on the date of grant. The restricted Common Stock vests
over a period from one to ten years. Compensation expense will be charged to
earnings over the vesting period.
During 2001, the Company awarded 94,450 shares of restricted Common
Stock to certain employees and 3,699 shares of restricted Common Stock to
certain Directors. These restricted shares of Common Stock had a fair value of
approximately $3,133 on the date of grant. The restricted Common Stock vests
over a period from one to ten years. Compensation expense will be charged to
earnings over the vesting period.
During 2000, the Company awarded 355,139 shares of restricted Common
Stock to certain employees and 3,663 shares of restricted Common Stock to
certain Directors. Other employees of the Company converted certain in-the-money
employee stock options to 14,903 shares of restricted Common Stock. These
restricted shares of Common Stock had a fair value of approximately $9,689 on
the date of grant. The restricted Common Stock vests over a period from one to
ten years. Compensation expense will be charged to earnings over the vesting
period.
13. RELATED PARTY TRANSACTIONS
The Company periodically engages in transactions for which CB Richard
Ellis, Inc. acts as a broker. A relative of one of the Company's
officers/Directors is an employee of CB Richard Ellis, Inc. For the years ended
December 31, 2002, 2001 and 2000, this relative received brokerage commissions
in the amount of $74, $17 and $60, respectively, from the Company.
The Company periodically utilizes consulting services from the private
consulting firm of one of the Company's Directors. For the years ended December
31, 2002 and 2001, no fees were paid to this entity. For the year ended December
31, 2000, the Company paid approximately $5 of fees to this entity.
In January and February 2001, First Industrial Development Services,
Inc. ("FRDS") purchased all of the voting and non-voting shares (a total of
25,790 shares) of FRDS held by certain executive officers of the Company for
approximately $1.3 million, in connection with FRDS' election to become a wholly
owned taxable REIT subsidiary of the Company. At the time of the transaction,
these executive officers had equity interests in FRDS totaling 2.76%. The
conversion of FRDS to a wholly-owned taxable REIT subsidiary of the Company will
not have a material impact on the financial position or results of operations of
the Company.
F-29
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
13. RELATED PARTY TRANSACTIONS, CONTINUED
On November 19, 1998, the Company sold two industrial properties to two
limited partnerships, Roosevelt Glen Corporate Center ("Roosevelt") and Hartford
Center Investment Company ("Hartford"), for a total consideration of
approximately $8,341. An entity in which one of the shareholders is the Chairman
of the Board of Directors, ("TSIC") has a 11.638% general partner interest in
Roosevelt. TSIC has a 12.39% general partner interest in Hartford. On December
4, 1998, the Company sold one industrial property to Eastgate Shopping Center
Investment Co. ("Eastgate"), a limited partnership, for total consideration of
approximately $2,521. TSIC has a 12.972% general partner interest in Eastgate.
In each case, the purchaser had the option of selling the properties back to the
Company and the Company had the option of buying the properties back from the
purchaser for a stipulated period of time. In January 2000, the purchasers
exercised their options to sell the properties back to the Company. Due to the
existence and exercise of the options mentioned above, the sales were not
recognized.
14. COMMITMENTS AND CONTINGENCIES
In the normal course of business, the Company is involved in legal
actions arising from the ownership of its properties. In management's opinion,
the liabilities, if any, that may ultimately result from such legal actions are
not expected to have a materially adverse effect on the consolidated financial
position, operations or liquidity of the Company.
Fifteen properties have leases granting the tenants options to purchase
the property. Such options are exercisable at various times at appraised fair
market value or at a fixed purchase price generally in excess of the Company's
depreciated cost of the asset. The Company has no notice of any exercise of any
tenant purchase option.
The Company has committed to the construction of 31 industrial
properties totaling approximately 2.8 million square feet (unaudited) of GLA.
The estimated total construction costs are approximately $155.9 million
(unaudited). Of this amount, approximately $26.2 million remains to be funded.
These developments are expected to be funded with proceeds from the sale of
select properties, cash flows from operations and borrowings under the Company's
2002 Unsecured Line of Credit. The Company expects to place in service all of
the development projects during the next twelve months. There can be no
assurance that the Company will place these projects in service during the next
twelve months or that the actual completion cost will not exceed the estimated
completion cost stated above.
At December 31, 2002, the Company had 11 letters of credit outstanding
in the aggregate amount of $5,713. These letters of credit expire between March
2003 and August 2004.
15. SUBSEQUENT EVENTS (UNAUDITED)
On January 13, 2003, the Company, through the Mortgage Partnership,
paid off and retired the 1995 Mortgage Loan.
On January 27, 2003, the Company and the Operating Partnership paid a
fourth quarter 2002 distribution of $.6850 per common share/unit, totaling
approximately $31,106.
From January 1, 2003 to March 7, 2003, the Company repurchased 37,300
shares of its common stock at a weighted average price of approximately $26.73
per share.
F-30
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
15. SUBSEQUENT EVENTS (UNAUDITED), CONTINUED
On March 5, 2003, the Company declared a first quarter 2003
distribution of $.6850 per common share/unit on its common stock/units which is
payable on April 21, 2003. The Company also declared first quarter 2003
dividends of $53.906 per share ($.53906 per Depositary share), $49.687 per share
($.49687 per Depositary share) and $49.375 per share ($.49375 per Depositary
share) on its Series C Preferred Stock, Series D Preferred Stock and Series E
Preferred Stock, respectively, totaling, in the aggregate, approximately $5,044,
which is payable on March 31, 2003.
From January 1, 2003 to March 7, 2003, the Company awarded 1,073 shares
of restricted common stock to certain Directors. These shares of restricted
common stock had a fair value of approximately $31 on the date of grant. The
restricted common stock vests over ten years. Compensation expense will be
charged to earnings over the respective vesting period.
From January 1, 2003 to March 7, 2003, the Company acquired or
completed development of two industrial properties for a total estimated
investment of approximately $26,650. The Company also sold six industrial
properties and two land parcels for approximately $15,723 of gross proceeds
during this period.
16. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
The following table summarizes quarterly financial information of the
Company. The first, second and third fiscal quarters of 2002 and all fiscal
quarters in 2001 have been restated in accordance with FAS 144. As a result,
income from continuing operations and income from discontinued operations in
this table will not agree to the income from continuing operations and income
from discontinued operations presented in prior financial statements filed with
the Securities and Exchange Commission.
F-31
FIRST INDUSTRIAL REALTY TRUST, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
16. QUARTERLY FINANCIAL INFORMATION (UNAUDITED), CONTINUED
<Table>
<Caption>
Year Ended December 31, 2002
--------------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
-------- -------- -------- --------
Total Revenues ................................................ $ 82,362 $ 86,035 $ 86,990 $ 91,178
Equity In Income (Loss) of Joint Ventures ..................... 222 354 559 (672)
Gain on Sale of Real Estate ................................... 5,339 4,845 8,176 (1,884)
Income from Continuing Operations ............................. 18,176 15,911 19,912 9,388
Income from Discontinued Operations ........................... 14,850 18,268 9,754 24,190
Minority Interest Allocable to Discontinued Operations ........ (2,253) (2,738) (1,436) (3,619)
Extraordinary Loss ............................................ -- (888) -- --
Minority Interest Allocable to Extraordinary Loss ............. -- 134 -- --
Net Income .................................................... 30,773 30,687 28,230 29,959
Preferred Stock Dividends ..................................... (7,231) (6,113) (5,044) (5,044)
-------- -------- -------- --------
Net Income Available to Common Stockholders ................... $ 23,542 $ 24,574 $ 23,186 $ 24,915
======== ======== ======== ========
Income from Continuing Operations Available to Common
Stockholders Before Extraordinary Loss Available to Common
Stockholders per Weighted Average Common Share Outstanding:
Basic ................................................ $ .28 $ .25 $ .38 $ .11
======== ======== ======== ========
Diluted .............................................. $ .28 $ .25 $ .37 $ .11
======== ======== ======== ========
NetIncome Available to Common Stockholders Before
Extraordinary Loss per Weighted Average Common Share
Outstanding:
Basic ................................................ $ .60 $ .64 $ .59 $ .64
======== ======== ======== ========
Diluted .............................................. $ .60 $ .64 $ .58 $ .64
======== ======== ======== ========
Net Income Available to Common Stockholders per Weighted
Average Common Share Outstanding:
Basic ................................................ $ .60 $ .62 $ .59 $ .64
======== ======== ======== ========
Diluted .............................................. $ .60 $ .62 $ .58 $ .64
======== ======== ======== ========
</Table>
<Table>
<Caption>
Year Ended December 31, 2001
--------------------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter
-------- -------- -------- --------
Total Revenues ................................................ $ 91,567 $ 89,639 $ 84,824 $ 85,210
Equity In Income (Loss) of Joint Ventures ..................... 186 250 315 (1,542)
Gain on Sale of Real Estate ................................... 13,876 15,822 18,808 15,841
Income from Continuing Operations ............................. 30,403 32,138 34,531 17,279
Income from Discontinued Operations ........................... 5,686 5,767 5,836 2,474
Minority Interest Allocable to Discontinued Operations ........ (890) (884) (883) (381)
Extraordinary Loss ............................................ -- (10,309) -- --
Minority Interest Allocable to Extraordinary Loss ............. -- 1,597 -- --
Net Income .................................................... 35,199 28,309 39,484 19,372
Preferred Stock Dividends ..................................... (8,211) (7,328) (7,231) (7,231)
-------- -------- -------- --------
Net Income Available to Common Stockholders ................... $ 26,988 $ 20,981 $ 32,253 $ 12,141
======== ======== ======== ========
Income from Continuing Operations Available to Common
Stockholders Before Extraordinary Loss Available to Common
Stockholders per Weighted Average Common Share Outstanding:
Basic ................................................ $ .57 $ .63 $ .69 $ .26
======== ======== ======== ========
Diluted .............................................. $ .56 $ .62 $ .68 $ .26
======== ======== ======== ========
Net Income Available to Common Stockholders Before
Extraordinary Loss per Weighted Average Common Share
Outstanding:
Basic ................................................ $ .69 $ .75 $ .81 $ .31
======== ======== ======== ========
Diluted .............................................. $ .69 $ .75 $ .81 $ .31
======== ======== ======== ========
Net Income Available to Common Stockholders per Weighted
Average Common Share Outstanding:
Basic ................................................ $ .69 $ .53 $ .81 $ .31
======== ======== ======== ========
Diluted .............................................. $ .69 $ .53 $ .81 $ .31
======== ======== ======== ========
</Table>
F-32
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholders
of First Industrial Realty Trust, Inc.:
Our audits of the consolidated financial statements referred to in our report
dated February 11, 2003 of First Industrial Realty Trust, Inc. and its
subsidiaries which report and consolidated financial statements are included in
this Annual Report on Form 10-K also included an audit of the financial
statement schedule listed in the Index to Financial Statements and Financial
Statement Schedule on page F-1 of this Form 10-K. In our opinion, this financial
statement schedule presents fairly, in all material respects, the information
set forth therein when read in conjunction with the related consolidated
financial statements.
PricewaterhouseCoopers LLP
Chicago, Illinois
February 11, 2003
S-1
FIRST INDUSTRIAL REALTY TRUST, INC.
SCHEDULE III:
REAL ESTATE AND ACCUMULATED DEPRECIATION
AS OF DECEMBER 31, 2002
(DOLLARS IN THOUSANDS)
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
ATLANTA
4250 River Green Parkway Duluth, GA (c) $ 264 $ 1,522 $ 82
3400 Corporate Parkway Duluth, GA (c) 281 1,621 421
3450 Corporate Parkway Duluth, GA (c) 506 2,904 290
3500 Corporate Parkway Duluth, GA (c) 260 1,500 144
3425 Corporate Parkway Duluth, GA (c) 385 2,212 301
1650 GA Highway 155 McDonough, GA 788 4,544 344
14101 Industrial Park Boulevard Covington, GA 285 1,658 541
801-804 Blacklawn Road Conyers, GA 361 2,095 714
1665 Dogwood Drive Conyers, GA 635 3,662 234
1715 Dogwood Drive Conyers, GA 288 1,675 245
11235 Harland Drive Covington, GA 125 739 70
4050 Southmeadow Parkway Atlanta, GA 401 2,813 211
4051 Southmeadow Parkway Atlanta, GA 726 4,130 1,057
4071 Southmeadow Parkway Atlanta, GA 750 4,460 886
3312 N. Berkeley Lake Road Duluth, GA 2,937 16,644 1,807
370 Great Southwest Parkway(i) Atlanta, GA 527 2,984 588
955 Cobb Place Kennesaw, GA 780 4,420 242
2084 Lake Industrial Court Conyers, GA 662 - 4,764
2039 Monier Blvd Lithia Springs, GA 651 2,770 169
1005 Sigman Road Conyers, GA 566 3,134 143
2050 East Park Drive Conyers, GA 452 2,504 183
201 Greenwood McDonough, GA 2,066 304 19,263
220 Greenwood Court McDonough, GA 2,015 - 8,820
1255 Oakbrook Drive Norcross, GA 195 1,107 41
1256 Oakbrook Drive Norcross, GA 336 1,907 172
1265 Oakbrook Drive Norcross, GA 307 1,742 130
1266 Oakbrook Drive Norcross, GA 234 1,326 26
1275 Oakbrook Drive Norcross, GA 400 2,269 53
1280 Oakbrook Drive Norcross, GA 281 1,592 133
1300 Oakbrook Drive Norcross, GA 420 2,381 31
1325 Oakbrook Drive Norcross, GA 332 1,879 123
1351 Oakbrook Drive Norcross, GA 370 2,099 53
1346 Oakbrook Drive Norcross, GA 740 4,192 47
1412 Oakbrook Drive Norcross, GA 313 1,776 45
BALTIMORE
3431 Benson Baltimore, MD 553 3,062 112
1801 Portal Baltimore, MD 251 1,387 176
1811 Portal Baltimore, MD 327 1,811 340
1831 Portal Baltimore, MD 268 1,486 452
1821 Portal Baltimore, MD 430 2,380 1,491
1820 Portal Baltimore, MD (g) 884 4,891 455
6615 Tributary Baltimore, MD 420 2,327 126
7340 Executive Frederick, MD 936 5,182 242
4845 Governers Way Frederick, MD 810 4,487 216
8900 Yellow Brick Road Baltimore, MD 447 2,473 369
7476 New Ridge Hanover, MD 394 2,182 209
1328 Charwood Road Hanover, MD 717 3,968 896
8779 Greenwood Place Savage, MD 704 3,896 520
1350 Blair Drive Odenton, MD 301 1,706 200
1360 Blair Drive Odenton, MD 321 1,820 84
1370 Blair Drive Odenton, MD 381 2,161 125
9020 Mendenhall Court Columbia, MD 530 3,001 48
CENTRAL PENNSYLVANIA
1214-B Freedom Road Cranberry Township, PA 31 994 618
401 Russell Drive Middletown, PA 262 857 1,845
2700 Commerce Drive Middletown, PA 196 997 710
2701 Commerce Drive Middletown, PA 141 859 1,172
2780 Commerce Drive Middletown, PA 113 743 1,054
7125 Grayson Road Harrisburg, PA 1,514 8,779 40
7253 Grayson Road Harrisburg, PA 894 5,168 220
5020 Louise Drive Mechanicsburg, PA 707 - 2,793
7195 Grayson Harrisburg, PA 478 2,771 80
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
ATLANTA
4250 River Green Parkway $ 264 $ 1,604 $ 1,868 $ 373 1988 (p)
3400 Corporate Parkway 281 2,042 2,323 603 1987 (p)
3450 Corporate Parkway 506 3,194 3,700 719 1988 (p)
3500 Corporate Parkway 260 1,644 1,904 387 1991 (p)
3425 Corporate Parkway 385 2,513 2,898 630 1990 (p)
1650 GA Highway 155 788 4,888 5,676 1,162 1991 (p)
14101 Industrial Park Boulevard 285 2,199 2,484 416 1984 (p)
801-804 Blacklawn Road 361 2,809 3,170 654 1982 (p)
1665 Dogwood Drive 635 3,896 4,531 831 1973 (p)
1715 Dogwood Drive 288 1,920 2,208 472 1973 (p)
11235 Harland Drive 125 809 933 179 1988 (p)
4050 Southmeadow Parkway 425 3,000 3,425 648 1991 (p)
4051 Southmeadow Parkway 726 5,187 5,913 895 1989 (p)
4071 Southmeadow Parkway 828 5,269 6,096 1,157 1991 (p)
3312 N. Berkeley Lake Road 3,052 18,337 21,389 3,189 1969 (p)
370 Great Southwest Parkway(i) 546 3,552 4,098 736 1986 (p)
955 Cobb Place 804 4,638 5,442 611 1991 (p)
2084 Lake Industrial Court 804 4,623 5,426 258 1998 (p)
2039 Monier Blvd 652 2,938 3,590 176 1999 (p)
1005 Sigman Road 574 3,269 3,843 264 1986 (p)
2050 East Park Drive 459 2,680 3,139 291 1998 (p)
201 Greenwood 2,520 19,113 21,634 1,461 1999 (p)
220 Greenwood Court 1,700 9,135 10,835 247 2000 (p)
1255 Oakbrook Drive 197 1,146 1,343 40 1984 (p)
1256 Oakbrook Drive 339 2,076 2,415 72 1984 (p)
1265 Oakbrook Drive 309 1,870 2,179 64 1984 (p)
1266 Oakbrook Drive 235 1,350 1,586 48 1984 (p)
1275 Oakbrook Drive 403 2,319 2,722 81 1986 (p)
1280 Oakbrook Drive 283 1,724 2,006 58 1986 (p)
1300 Oakbrook Drive 423 2,410 2,833 85 1986 (p)
1325 Oakbrook Drive 334 2,000 2,334 67 1986 (p)
1351 Oakbrook Drive 373 2,150 2,522 79 1984 (p)
1346 Oakbrook Drive 744 4,235 4,979 150 1985 (p)
1412 Oakbrook Drive 315 1,819 2,134 64 1985 (p)
BALTIMORE
3431 Benson 562 3,165 3,727 374 1988 (p)
1801 Portal 271 1,542 1,813 186 1987 (p)
1811 Portal 354 2,125 2,479 313 1987 (p)
1831 Portal 290 1,916 2,207 282 1990 (p)
1821 Portal 468 3,833 4,301 657 1986 (p)
1820 Portal 899 5,331 6,230 618 1982 (p)
6615 Tributary 432 2,440 2,873 296 1987 (p)
7340 Executive 957 5,402 6,360 645 1988 (p)
4845 Governers Way 824 4,689 5,513 546 1988 (p)
8900 Yellow Brick Road 475 2,814 3,289 331 1982 (p)
7476 New Ridge 401 2,384 2,785 285 1987 (p)
1328 Charwood Road 715 4,866 5,581 626 1986 (p)
8779 Greenwood Place 727 4,393 5,120 345 1978 (p)
1350 Blair Drive 314 1,892 2,207 110 1991 (p)
1360 Blair Drive 331 1,894 2,225 94 1991 (p)
1370 Blair Drive 394 2,273 2,667 117 1991 (p)
9020 Mendenhall Court 535 3,043 3,578 89 1981 (p)
CENTRAL PENNSYLVANIA
1214-B Freedom Road 205 1,438 1,643 723 1982 (p)
401 Russell Drive 287 2,676 2,964 1,063 1990 (p)
2700 Commerce Drive 206 1,697 1,903 672 1990 (p)
2701 Commerce Drive 164 2,008 2,172 681 1989 (p)
2780 Commerce Drive 209 1,701 1,910 693 1989 (p)
7125 Grayson Road 1,514 8,819 10,332 1,920 1991 (p)
7253 Grayson Road 894 5,388 6,282 1,247 1990 (p)
5020 Louise Drive 716 2,784 3,500 605 1995 (p)
7195 Grayson 479 2,849 3,328 575 1994 (p)
</Table>
S-2
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
3380 Susquehanna Trail North York,PA 450 2,550 137
495 East Locust Lane York,PA 810 4,590 340
350 Old Silver Springs Road Mechanicsburg, PA 510 2,890 4,315
4500 Westport Drive Mechanicsburg, PA 690 3,910 397
125 East Kensinger Drive Cranberry Township, PA 585 - 3,407
CHICAGO
720-730 Landwehr Road Northbrook, IL (c) 521 2,982 439
20W201 101st Street Lemont, IL (c) 967 5,554 1,097
2300 Hammond Drive Schaumburg, IL 442 1,241 1,111
3600 West Pratt Avenue Lincolnwood, IL 1,050 5,767 1,069
6750 South Sayre Avenue Bedford Park, IL 224 1,309 384
585 Slawin Court Mount Prospect, IL 611 3,505 13
2300 Windsor Court Addison, IL 688 3,943 636
3505 Thayer Court Aurora, IL 430 2,472 45
3600 Thayer Court Aurora, IL 636 3,645 378
736-776 Industrial Drive Elmhurst, IL 349 1,994 1,040
480 East 14th St. Chicago, Heights, IL 620 3,430 638
305-311 Era Drive Northbrook, IL 200 1,154 151
4330 South Racine Avenue Chicago, IL 448 1,893 236
12241 Melrose Street Franklin Park, IL 332 1,931 1,403
3150-3160 MacArthur Boulevard Northbrook, IL 439 2,518 112
2942 MacArthur Boulevard Northbrook, IL 315 1,803 256
305-307 East North Ave Carol Stream, IL 126 - 2,727
301 Alice Wheeling, IL 218 1,236 205
11939 S Central Avenue Alsip, IL 1,208 6,843 1,661
405 East Shawmut LaGrange, IL 368 2,083 36
1010-50 Sesame Street Bensenville, IL 979 5,546 599
5555 West 70th Place Bedford Park, IL 146 829 280
3200-3250 South St. Louis(i) Chicago, IL 110 625 1,036
3110-3130 South St. Louis Chicago, IL 115 650 55
7401 South Pulaski Chicago, IL 664 3,763 1,201
7501 S. Pulaski Chicago, IL 360 2,038 996
385 Fenton Lane West Chicago, IL 868 4,918 556
335 Crossroad Parkway Bolingbrook, IL 1,560 8,840 1,142
10435 Seymour Avenue Franklin Park, IL 181 1,024 634
905 Paramount Batavia, IL 243 1,375 383
1005 Paramount Batavia, IL 282 1,600 360
2120-24 Roberts Broadview, IL 220 1,248 417
405-17 University Drive Arlington Hts., IL 265 1,468 151
3575 Stern Avenue St. Charles, IL 431 2,386 50
3810 Stern Avenue St. Charles, IL 589 3,262 45
315 Kirk Road St. Charles, IL 1,404 7,774 109
700 Business Center Drive Mount Prospect, IL 270 1,492 120
555 Business Center Drive Mount Prospect, IL 241 1,336 80
800 Business Center Drive Mount Prospect, IL 631 3,493 233
580 Slawin Court Mount Prospect, IL 233 1,292 139
1150 Feehanville Drive Mount Prospect, IL 260 1,437 103
1200 Business Center D rive Mount Prospect, IL 765 4,237 380
1331 Business Center Drive Mount Prospect, IL 235 1,303 133
3627 Stern Avenue St. Charles, IL 187 1,034 28
301-329 Airport Blvd North Aurora, IL 570 3,156 194
19W661 101st Street Lemont, IL 1,200 6,643 92
19W751 101st Street Lemont, IL 789 4,368 103
175 Wall Street Glendale Heights, IL 427 2,363 42
800-820 Thorndale Avenue Bensenville, IL 751 4,159 63
830-890 Supreme Drive Bensenville, IL 671 3,714 57
1661 Feehanville Drive Mount Prospect, IL 985 5,455 390
CINCINNATI
9900-9970 Princeton Cincinnati, OH 545 3,088 1,487
2940 Highland Avenue Cincinnati, OH 1,717 9,730 1,957
4700-4750 Creek Road Blue Ash, OH 1,080 6,118 901
12072 Best Place Springboro, OH 426 - 3,374
901 Pleasant Valley Drive Springboro, OH 304 1,721 300
4440 Mulhauser Road Cincinnati, OH 1,067 39 5,361
4434 Mulhauser Road Cincinnati, OH 444 16 4,499
9449 Glades Drive Hamilton, OH 464 - 4,316
COLUMBUS
3800 Lockbourne Industrial Pkwy(s) Columbus, OH 1,133 6,421 120
1819 North Walcutt Road(s) Columbus, OH 810 4,590 (628)
4300 Cemetery Road(s) Hillard, OH 1,103 6,248 (1,796)
4115 Leap Road(i) Hillard, OH 758 4,297 409
3300 Lockbourne Columbus, OH 708 3,920 940
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
3380 Susquehanna Trail North 467 2,670 3,137 389 1990 (p)
495 East Locust Lane 838 4,902 5,740 714 1993/94 (p)
350 Old Silver Springs Road 541 7,174 7,715 870 1968/97 (p)
4500 Westport Drive 727 4,269 4,997 576 1996 (p)
125 East Kensinger Drive 1,143 2,849 3,992 124 2000 (p)
CHICAGO
720-730 Landwehr Road 521 3,421 3,942 688 1978 (p)
20W201 101st Street 968 6,650 7,618 1,621 1988 (p)
2300 Hammond Drive 445 2,349 2,794 1,771 1970 (p)
3600 West Pratt Avenue 1,050 6,836 7,887 1,432 1953/88 (p)
6750 South Sayre Avenue 224 1,693 1,917 323 1975 (p)
585 Slawin Court 611 3,518 4,129 702 1992 (p)
2300 Windsor Court 696 4,572 5,268 1,212 1986 (p)
3505 Thayer Court 430 2,517 2,947 543 1989 (p)
3600 Thayer Court 636 4,023 4,659 936 1989 (p)
736-776 Industrial Drive 349 3,034 3,383 836 1975 (p)
480 East 14th St. 620 4,068 4,688 500 1958 (p)
305-311 Era Drive 205 1,300 1,505 305 1978 (p)
4330 South Racine Avenue 468 2,109 2,577 1,623 1978 (p)
12241 Melrose Street 469 3,197 3,666 626 1969 (p)
3150-3160 MacArthur Boulevard 429 2,640 3,069 612 1978 (p)
2942 MacArthur Boulevard 311 2,062 2,374 599 1979 (p)
305-307 East North Ave 128 2,726 2,854 138 1999 (p)
301 Alice 225 1,435 1,659 228 1965 (p)
11939 S Central Avenue 1,229 8,482 9,711 1,063 1972 (p)
405 East Shawmut 369 2,117 2,486 300 1965 (p)
1010-50 Sesame Street 1,003 6,121 7,124 727 1976 (p)
5555 West 70th Place 157 1,098 1,255 132 1973 (p)
3200-3250 South St. Louis(i) 113 1,658 1,771 557 1968 (p)
3110-3130 South St. Louis 117 703 820 96 1968 (p)
7401 South Pulaski 669 4,959 5,628 664 1975/86 (p)
7501 S. Pulaski 318 3,077 3,394 481 1975/86 (p)
385 Fenton Lane 884 5,457 6,341 660 1990 (p)
335 Crossroad Parkway 1,599 9,943 11,542 1,367 1996 (p)
10435 Seymour Avenue 190 1,649 1,839 253 1967/74 (p)
905 Paramount 252 1,749 2,001 211 1977 (p)
1005 Paramount 293 1,950 2,243 241 1978 (p)
2120-24 Roberts 229 1,656 1,885 232 1960 (p)
405-17 University Drive 267 1,618 1,884 188 1977/78 (p)
3575 Stern Avenue 436 2,431 2,867 126 1979/84 (p)
3810 Stern Avenue 596 3,301 3,897 172 1985 (p)
315 Kirk Road 1,420 7,867 9,287 410 1969/93/95 (p)
700 Business Center Drive 288 1,594 1,882 83 1980 (p)
555 Business Center Drive 252 1,406 1,658 74 1981 (p)
800 Business Center Drive 666 3,692 4,358 192 1988/99 (p)
580 Slawin Court 254 1,411 1,665 73 1985 (p)
1150 Feehanville Drive 273 1,527 1,801 83 1983 (p)
1200 Business Center D rive 814 4,568 5,382 257 1988/2000 (p)
1331 Business Center Drive 255 1,416 1,672 73 1985 (p)
3627 Stern Avenue 189 1,059 1,248 55 1979 (p)
301-329 Airport Blvd 593 3,328 3,921 132 1997 (p)
19W661 101st Street 1,200 6,735 7,935 210 1988 (p)
19W751 101st Street 793 4,468 5,261 138 1991 (p)
175 Wall Street 433 2,400 2,832 55 1990 (p)
800-820 Thorndale Avenue 760 4,213 4,973 9 1985 (p)
830-890 Supreme Drive 679 3,763 4,442 8 1981 (p)
1661 Feehanville Drive 1,044 5,786 6,830 300 1986 (p)
CINCINNATI
9900-9970 Princeton 566 4,553 5,120 831 1970 (p)
2940 Highland Avenue 1,772 11,632 13,404 2,037 1969/74 (p)
4700-4750 Creek Road 1,109 6,989 8,098 1,362 1960 (p)
12072 Best Place 443 3,357 3,800 586 1984 (p)
901 Pleasant Valley Drive 316 2,010 2,325 308 1984/94 (p)
4440 Mulhauser Road 655 5,813 6,467 654 1999 (p)
4434 Mulhauser Road 463 4,496 4,959 361 1999 (p)
9449 Glades Drive 477 4,304 4,780 373 1999 (p)
COLUMBUS
3800 Lockbourne Industrial Pkwy(s) 1,045 6,630 7,674 1,414 1986 (p)
1819 North Walcutt Road(s) 637 4,135 4,772 709 1973 (p)
4300 Cemetery Road(s) 764 4,791 5,555 783 1968/83 (p)
4115 Leap Road(i) 756 4,707 5,463 521 1977 (p)
3300 Lockbourne 710 4,858 5,568 488 1964 (p)
</Table>
S-3
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
DALLAS/FORT WORTH
1275-1281 Roundtable Drive Dallas, TX 148 839 28
2406-2416 Walnut Ridge Dallas, TX 178 1,006 283
12750 Perimiter Drive Dallas, TX 638 3,618 240
1324-1343 Roundtable Drive Dallas, TX 178 1,006 281
2401-2419 Walnut Ridge Dallas, TX 148 839 50
4248-4252 Simonton Farmers Ranch, TX 888 5,032 389
900-906 Great Southwest Pkwy Arlington, TX 237 1,342 417
2179 Shiloh Road Garland, TX 251 1,424 87
2159 Shiloh Road Garland, TX 108 610 55
2701 Shiloh Road Garland, TX 818 4,636 875
12784 Perimeter Drive(j) Dallas, TX 350 1,986 507
3000 West Commerce Dallas, TX 456 2,584 507
3030 Hansboro Dallas, TX 266 1,510 476
5222 Cockrell Hill Dallas, TX 296 1,677 381
405-407 113th Arlington, TX 181 1,026 165
816 111th Street Arlington, TX 251 1,421 62
1017-25 Jacksboro Highway Fort Worth, TX 97 537 230
7341 Dogwood Park Richland Hills, TX 79 435 52
7427 Dogwood Park Richland Hills, TX 96 532 69
7348-54 Tower Street Richland Hills, TX 88 489 66
7370 Dogwood Park Richland Hills, TX 91 503 62
7339-41 Tower Street Richland Hills, TX 98 541 69
7437-45 Tower Street Richland Hills, TX 102 563 59
7331-59 Airport Freeway Richland Hills, TX 354 1,958 301
7338-60 Dogwood Park Richland Hills, TX 106 587 109
7450-70 Dogwood Park Richland Hills, TX 106 584 108
7423-49 Airport Freeway Richland Hills, TX 293 1,621 510
7400 Whitehall Street Richland Hills, TX 109 603 114
1602-1654 Terre Colony Dallas, TX 458 2,596 149
3330 Duncanville Road Dallas, TX 197 1,114 25
6851-6909 Snowden Road Fort Worth, TX 1,025 5,810 230
2351-2355 Merritt Drive Garland, TX 101 574 66
10575 Vista Park Dallas, TX 366 2,074 32
701-735 North Plano Road Richardson, TX 696 3,944 91
2259 Merritt Drive Garland, TX 96 544 43
2260 Merritt Drive Garland, TX 319 1,806 38
2220 Merritt Drive Garland, TX 352 1,993 45
2010 Merritt Drive Garland, TX 350 1,981 159
2363 Merritt Drive Garland, TX 73 412 7
2447 Merritt Drive Garland, TX 70 395 6
2465-2475 Merritt Drive Garland, TX 91 514 9
2485-2505 Merritt Drive Garland, TX 431 2,440 86
17919 Waterview Parkway Dallas, TX 833 4,718 94
2081 Hutton Drive - Bldg 1(j) Carrolton, TX 448 2,540 392
2150 Hutton Drive Carrolton, TX 192 1,089 238
2110 Hutton Drive Carrolton, TX 374 2,117 181
2025 McKenzie Drive Carrolton, TX 437 2,478 143
2019 McKenzie Drive Carrolton, TX 502 2,843 95
1420 Valwood Parkway - Bldg 1(i) Carrolton, TX 460 2,608 277
1620 Valwood Parkway(j) Carrolton, TX 1,089 6,173 977
1505 Luna Road - Bldg II Carrolton, TX 167 948 49
1625 West Crosby Road Carrolton, TX 617 3,498 648
2029-2035 McKenzie Drive Carrolton, TX 330 1,870 169
1840 Hutton Drive(i) Carrolton, TX 811 4,597 340
1420 Valwood Pkwy - Bldg II Carrolton, TX 373 2,116 225
2015 McKenzie Drive Carrolton, TX 510 2,891 320
2009 McKenzie Drive Carrolton, TX 476 2,699 297
1505 Luna Road - Bldg I Carrolton, TX 521 2,953 79
1505 Luna Road - Bldg III Carrolton, TX 658 3,728 317
900-1100 Avenue S Grand Prairie, TX 623 3,528 46
15001 Trinity Blvd Ft. Worth, TX 529 2,998 36
Plano Crossing(k) Plano, TX 1,961 11,112 132
7413A-C Dogwood Park Richland Hills, TX 110 623 8
7450 Tower Street Richland Hills, TX 36 204 5
7436 Tower Street Richland Hills, TX 57 324 15
7501 Airport Freeway Richland Hills, TX 113 638 13
7426 Tower Street Richland Hills, TX 76 429 6
7427-7429 Tower Street Richland Hills, TX 75 427 7
2840-2842 Handley Ederville Rd Richland Hills, TX 112 635 12
7451-7477 Airport Freeway Richland Hills, TX 256 1,453 45
7415 Whitehall Street Richland Hills, TX 372 2,107 71
7450 Whitehall Street Richland Hills, TX 104 591 9
7430 Whitehall Street Richland Hills, TX 143 809 13
7420 Whitehall Street Richland Hills, TX 110 621 13
300 Wesley Way Richland Hills, TX 208 1,181 16
2104 Hutton Drive Carrolton, TX 246 1,393 57
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
DALLAS/FORT WORTH
1275-1281 Roundtable Drive 117 897 1,015 124 1966 (p)
2406-2416 Walnut Ridge 183 1,284 1,467 147 1978 (p)
12750 Perimiter Drive 660 3,837 4,497 485 1979 (p)
1324-1343 Roundtable Drive 184 1,281 1,465 203 1972 (p)
2401-2419 Walnut Ridge 153 883 1,037 111 1978 (p)
4248-4252 Simonton 920 5,390 6,309 716 1973 (p)
900-906 Great Southwest Pkwy 270 1,726 1,996 194 1972 (p)
2179 Shiloh Road 256 1,506 1,762 188 1982 (p)
2159 Shiloh Road 110 663 773 85 1982 (p)
2701 Shiloh Road 923 5,406 6,329 694 1981 (p)
12784 Perimeter Drive(j) 396 2,446 2,843 314 1981 (p)
3000 West Commerce 469 3,077 3,547 354 1980 (p)
3030 Hansboro 276 1,977 2,252 284 1971 (p)
5222 Cockrell Hill 306 2,048 2,354 236 1973 (p)
405-407 113th 185 1,187 1,372 200 1969 (p)
816 111th Street 258 1,476 1,734 192 1972 (p)
1017-25 Jacksboro Highway 103 762 865 66 1970 (p)
7341 Dogwood Park 84 482 566 49 1973 (p)
7427 Dogwood Park 102 596 698 61 1973 (p)
7348-54 Tower Street 94 549 643 57 1978 (p)
7370 Dogwood Park 96 559 656 58 1987 (p)
7339-41 Tower Street 104 603 707 63 1980 (p)
7437-45 Tower Street 108 615 723 63 1977 (p)
7331-59 Airport Freeway 372 2,241 2,613 245 1987 (p)
7338-60 Dogwood Park 112 690 803 87 1978 (p)
7450-70 Dogwood Park 112 686 798 95 1985 (p)
7423-49 Airport Freeway 308 2,116 2,424 278 1985 (p)
7400 Whitehall Street 115 711 826 105 1994 (p)
1602-1654 Terre Colony 468 2,735 3,203 208 1981 (p)
3330 Duncanville Road 199 1,136 1,335 64 1987 (p)
6851-6909 Snowden Road 1,038 6,027 7,065 392 1985/86 (p)
2351-2355 Merritt Drive 103 639 741 38 1986 (p)
10575 Vista Park 371 2,101 2,472 118 1988 (p)
701-735 North Plano Road 705 4,026 4,731 226 1972/94 (p)
2259 Merritt Drive 97 586 683 52 1986 (p)
2260 Merritt Drive 323 1,840 2,163 102 1986/99 (p)
2220 Merritt Drive 356 2,034 2,390 114 1986/2000 (p)
2010 Merritt Drive 354 2,135 2,489 187 1986 (p)
2363 Merritt Drive 74 418 492 24 1986 (p)
2447 Merritt Drive 71 401 471 23 1986 (p)
2465-2475 Merritt Drive 92 522 614 29 1986 (p)
2485-2505 Merritt Drive 436 2,521 2,956 141 1986 (p)
17919 Waterview Parkway 843 4,801 5,644 274 1987 (p)
2081 Hutton Drive - Bldg 1(j) 453 2,928 3,380 162 1981 (p)
2150 Hutton Drive 194 1,325 1,519 75 1980 (p)
2110 Hutton Drive 377 2,294 2,671 121 1985 (p)
2025 McKenzie Drive 442 2,617 3,058 134 1985 (p)
2019 McKenzie Drive 507 2,933 3,439 145 1985 (p)
1420 Valwood Parkway - Bldg 1(i) 466 2,880 3,345 145 1986 (p)
1620 Valwood Parkway(j) 1,100 7,139 8,239 360 1986 (p)
1505 Luna Road - Bldg II 169 995 1,164 50 1988 (p)
1625 West Crosby Road 631 4,132 4,763 306 1988 (p)
2029-2035 McKenzie Drive 306 2,063 2,369 100 1985 (p)
1840 Hutton Drive(i) 819 4,930 5,749 229 1986 (p)
1420 Valwood Pkwy - Bldg II 377 2,338 2,715 106 1986 (p)
2015 McKenzie Drive 516 3,205 3,721 155 1986 (p)
2009 McKenzie Drive 481 2,991 3,472 150 1987 (p)
1505 Luna Road - Bldg I 529 3,024 3,553 138 1988 (p)
1505 Luna Road - Bldg III 664 4,038 4,702 214 1988 (p)
900-1100 Avenue S 629 3,567 4,196 30 1985 (p)
15001 Trinity Blvd 534 3,029 3,563 25 1984 (p)
Plano Crossing(k) 1,981 11,224 13,204 94 1998 (p)
7413A-C Dogwood Park 111 630 741 4 1990 (p)
7450 Tower Street 36 208 245 1 1977 (p)
7436 Tower Street 58 339 397 2 1979 (p)
7501 Airport Freeway 115 649 764 4 1983 (p)
7426 Tower Street 76 435 511 3 1978 (p)
7427-7429 Tower Street 76 433 509 3 1981 (p)
2840-2842 Handley Ederville Rd 113 646 759 4 1977 (p)
7451-7477 Airport Freeway 259 1,495 1,754 10 1984 (p)
7415 Whitehall Street 375 2,174 2,550 14 1986 (p)
7450 Whitehall Street 105 600 705 4 1978 (p)
7430 Whitehall Street 144 820 964 5 1985 (p)
7420 Whitehall Street 111 633 743 4 1985 (p)
300 Wesley Way 211 1,196 1,406 8 1995 (p)
2104 Hutton Drive 249 1,447 1,696 74 1990 (p)
</Table>
S-4
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
Addison Tech Ctr - Bldg B Addison, TX 1,647 6,400 1
7337 Dogwood Park Richland Hills, TX 80 453 13
7334 Tower Street Richland Hills, TX 69 393 12
7451 Dogwood Park Richland Hills, TX 133 753 20
7440 Whitehall Street Richland Hills, TX 74 420 7
2821 Cullen Street Fort Worth, TX 71 404 5
DAYTON
6094-6104 Executive Blvd Huber Heights, OH 181 1,025 198
6202-6220 Executive Blvd Huber Heights, OH 268 1,521 139
6268-6294 Executive Blvd Huber Heights, OH 255 1,444 265
5749-5753 Executive Blvd Huber Heights, OH 50 282 93
6230-6266 Executive Blvd Huber Heights, OH 271 1,534 373
2200-2224 Sandridge Road Moriane, OH 218 1,233 98
8119-8137 Uehling Lane Dayton, OH 103 572 59
DENVER
7100 North Broadway - 1 Denver, CO 201 1,141 278
7100 North Broadway - 2 Denver, CO 203 1,150 289
7100 North Broadway - 3 Denver, CO 139 787 122
7100 North Broadway - 5 Denver, CO 180 1,018 137
7100 North Broadway - 6 Denver, CO 269 1,526 250
20100 East 32nd Avenue Parkway Aurora, CO 333 1,888 336
15700-15820 West 6th Avenue Golden, CO 333 1,887 117
15850-15884 West 6th Avenue Golden, CO 201 1,139 147
5454 Washington Denver, CO 154 873 146
700 West 48th Street Denver, CO 302 1,711 154
702 West 48th Street Denver, CO 135 763 188
6425 North Washington Denver, CO 374 2,118 227
3370 North Peoria Street Aurora, CO 163 924 187
3390 North Peoria Street Aurora, CO 145 822 40
3508-3538 North Peoria Street Aurora, CO 260 1,472 97
3568 North Peoria Street Aurora, CO 222 1,260 192
4785 Elati Denver, CO 173 981 137
4770 Fox Street Denver, CO 132 750 56
1550 W. Evans Denver, CO 388 2,200 387
3751-71 Revere Street Denver, CO 262 1,486 72
3871 Revere Denver, CO 361 2,047 58
5454 Havana Street Denver, CO 204 1,156 36
5500 Havana Street Denver, CO 167 946 108
4570 Ivy Street Denver, CO 219 1,239 257
5855 Stapleton Drive North Denver, CO 288 1,630 186
5885 Stapleton Drive North Denver, CO 376 2,129 125
5200-5280 North Broadway Denver, CO 169 960 121
5977-5995 North Broadway Denver, CO 268 1,518 96
2952-5978 North Broadway Denver, CO 414 2,346 596
6400 North Broadway Denver, CO 318 1,804 107
875 Parfet Lakewood, CO 288 1,633 104
4721 Ironton Street Denver, CO 232 1,313 718
833 Parfet Street Lakewood, CO 196 1,112 67
11005 West 8th Avenue Lakewood, CO 102 580 58
7100 North Broadway - 7 Denver, CO 215 1,221 242
7100 North Broadway - 8 Denver, CO 79 448 206
6804 East 48th Avenue Denver, CO 253 1,435 100
445 Bryant Street Denver, CO 1,831 10,219 1,211
East 47th Drive - A Denver, CO 474 2,689 125
9500 West 49th Street - A Wheatridge, CO 283 1,625 16
9500 West 49th Street - B Wheatridge, CO 225 1,272 16
9500 West 49th Street - C Wheatridge, CO 602 3,409 21
9500 West 49th Street - D Wheatridge, CO 271 1,537 221
8100 South Park Way - A Littleton, CO 442 2,507 324
8100 South Park Way - B Littleton, CO 103 582 157
8100 South Park Way - C Littleton, CO 568 3,219 159
451-591 East 124th Avenue Littleton, CO 383 2,145 169
608 Garrison Street Lakewood, CO 265 1,501 281
610 Garrison Street Lakewood, CO 264 1,494 337
1111 West Evans(A&C) Denver, CO 233 1,321 119
1111 West Evans(B) Denver, CO 30 169 16
15000 West 6th Avenue Golden, CO 913 5,174 789
14998 West 6th Avenue Bldg E Golden, CO 565 3,199 183
14998 West 6th Avenue Bldg F Englewood, CO 269 1,525 185
12503 East Euclid Drive Denver, CO 1,219 6,905 488
6547 South Racine Circle Denver, CO 748 4,241 297
7800 East Iliff Avenue Denver, CO 188 1,067 40
2369 South Trenton Way Denver, CO 292 1,656 192
2422 S. Trenton Way Denver, CO 241 1,364 98
2452 South Trenton Way Denver, CO 421 2,386 117
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
Addison Tech Ctr - Bldg B 1,647 6,401 8,048 53 2001 (p)
7337 Dogwood Park 81 466 546 3 1975 (p)
7334 Tower Street 70 404 474 3 1975 (p)
7451 Dogwood Park 134 771 905 5 1977 (p)
7440 Whitehall Street 75 426 501 3 1983 (p)
2821 Cullen Street 72 409 481 3 1961 (p)
DAYTON
6094-6104 Executive Blvd 184 1,220 1,404 233 1975 (p)
6202-6220 Executive Blvd 275 1,653 1,928 276 1996 (p)
6268-6294 Executive Blvd 262 1,702 1,964 314 1989 (p)
5749-5753 Executive Blvd 53 372 425 92 1975 (p)
6230-6266 Executive Blvd 280 1,897 2,178 460 1979 (p)
2200-2224 Sandridge Road 223 1,324 1,548 196 1983 (p)
8119-8137 Uehling Lane 103 631 734 65 1978 (p)
DENVER
7100 North Broadway - 1 215 1,406 1,621 244 1978 (p)
7100 North Broadway - 2 204 1,438 1,642 269 1978 (p)
7100 North Broadway - 3 140 908 1,048 155 1978 (p)
7100 North Broadway - 5 178 1,157 1,335 228 1978 (p)
7100 North Broadway - 6 271 1,775 2,045 299 1978 (p)
20100 East 32nd Avenue Parkway 314 2,243 2,557 539 1997 (p)
15700-15820 West 6th Avenue 318 2,018 2,337 290 1978 (p)
15850-15884 West 6th Avenue 206 1,281 1,487 167 1978 (p)
5454 Washington 156 1,018 1,173 160 1985 (p)
700 West 48th Street 307 1,860 2,167 270 1984 (p)
702 West 48th Street 139 946 1,085 139 1984 (p)
6425 North Washington 385 2,333 2,718 332 1983 (p)
3370 North Peoria Street 163 1,111 1,275 252 1978 (p)
3390 North Peoria Street 147 861 1,007 128 1978 (p)
3508-3538 North Peoria Street 264 1,565 1,829 229 1978 (p)
3568 North Peoria Street 225 1,449 1,674 232 1978 (p)
4785 Elati 175 1,116 1,291 181 1972 (p)
4770 Fox Street 134 804 938 120 1972 (p)
1550 W. Evans 385 2,590 2,975 326 1975 (p)
3751-71 Revere Street 267 1,553 1,821 221 1980 (p)
3871 Revere 368 2,098 2,466 275 1980 (p)
5454 Havana Street 207 1,189 1,396 158 1980 (p)
5500 Havana Street 169 1,052 1,221 131 1980 (p)
4570 Ivy Street 220 1,494 1,714 253 1985 (p)
5855 Stapleton Drive North 290 1,814 2,104 242 1985 (p)
5885 Stapleton Drive North 380 2,250 2,630 323 1985 (p)
5200-5280 North Broadway 171 1,078 1,250 157 1977 (p)
5977-5995 North Broadway 271 1,611 1,882 215 1978 (p)
2952-5978 North Broadway 422 2,934 3,356 401 1978 (p)
6400 North Broadway 325 1,905 2,230 251 1982 (p)
875 Parfet 293 1,733 2,026 228 1975 (p)
4721 Ironton Street 236 2,026 2,262 285 1969 (p)
833 Parfet Street 199 1,176 1,375 161 1974 (p)
11005 West 8th Avenue 104 636 740 102 1974 (p)
7100 North Broadway - 7 217 1,461 1,678 245 1985 (p)
7100 North Broadway - 8 80 653 733 132 1985 (p)
6804 East 48th Avenue 256 1,532 1,789 201 1973 (p)
445 Bryant Street 1,829 11,432 13,261 1,461 1960 (p)
East 47th Drive - A 441 2,847 3,288 539 1997 (p)
9500 West 49th Street - A 286 1,638 1,924 251 1997 (p)
9500 West 49th Street - B 226 1,287 1,513 176 1997 (p)
9500 West 49th Street - C 600 3,432 4,032 476 1997 (p)
9500 West 49th Street - D 246 1,784 2,029 359 1997 (p)
8100 South Park Way - A 423 2,850 3,273 628 1997 (p)
8100 South Park Way - B 104 738 841 209 1984 (p)
8100 South Park Way - C 575 3,371 3,945 438 1984 (p)
451-591 East 124th Avenue 383 2,314 2,697 293 1979 (p)
608 Garrison Street 267 1,779 2,046 248 1984 (p)
610 Garrison Street 266 1,830 2,095 251 1984 (p)
1111 West Evans(A&C) 236 1,437 1,672 186 1986 (p)
1111 West Evans(B) 30 184 215 25 1986 (p)
15000 West 6th Avenue 916 5,961 6,877 817 1985 (p)
14998 West 6th Avenue Bldg E 568 3,379 3,947 471 1995 (p)
14998 West 6th Avenue Bldg F 271 1,708 1,979 306 1995 (p)
12503 East Euclid Drive 1,208 7,405 8,613 1,099 1986 (p)
6547 South Racine Circle 739 4,548 5,287 801 1996 (p)
7800 East Iliff Avenue 190 1,104 1,295 156 1983 (p)
2369 South Trenton Way 294 1,846 2,140 279 1983 (p)
2422 S. Trenton Way 243 1,461 1,703 199 1983 (p)
2452 South Trenton Way 426 2,498 2,924 344 1983 (p)
</Table>
S-5
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
651 Topeka Way Denver, CO 194 1,099 92
680 Atchison Way Denver, CO 194 1,099 70
8122 South Park Lane - A Littleton, CO 394 2,232 233
1600 South Abilene Aurora, CO 465 2,633 80
1620 South Abilene Aurora, CO 268 1,520 120
1640 South Abilene Aurora, CO 368 2,085 142
13900 East Florida Ave Aurora, CO 189 1,071 64
4301 South Federal Boulevard Englewood, CO 237 1,341 97
14401-14492 East 33rd Place Aurora, CO 445 2,519 176
11701 East 53rd Avenue Denver, CO 416 2,355 63
5401 Oswego Street Denver, CO 273 1,547 163
3811 Joliet Denver, CO 735 4,166 131
2630 West 2nd Avenue Denver, CO 51 286 5
2650 West 2nd Avenue Denver, CO 221 1,252 55
14818 West 6th Avenue Bldg A Golden, CO 494 2,799 231
14828 West 6th Avenue Bldg B Golden, CO 519 2,942 283
12055 E 49th Ave/4955 Peoria Denver, CO 298 1,688 325
4940-4950 Paris Denver, CO 152 861 58
4970 Paris Denver, CO 95 537 42
5010 Paris Denver, CO 89 505 20
7367 South Revere Parkway Englewood, CO 926 5,124 167
10311 W. Hampden Ave. Lakewood, CO 577 2,984 171
8200 East Park Meadows Drive(i) Lone Tree, CO 1,297 7,348 344
3250 Quentin(i) Aurora, CO 1,220 6,911 238
11585 E. 53rd Ave.(i) Denver, CO 1,770 10,030 279
10500 East 54th Ave.(j) Denver, CO 1,253 7,098 190
DES MOINES
2250 Delaware Ave.(s) Des Moines, IA 291 1,609 213
DETROIT
2654 Elliott Troy, MI (c) 57 334 83
1731 Thorncroft Troy, MI (c) 331 1,904 25
1653 E. Maple Troy, MI (c) 192 1,104 102
47461 Clipper Plymouth Township, MI (c) 122 723 111
47522 Galleon Plymouth Township, MI (c) 85 496 11
238 Executive Drive Troy, MI 52 173 494
256 Executive Drive Troy, MI 44 146 442
301 Executive Drive Troy, MI 71 293 614
449 Executive Drive Troy, MI 125 425 959
501 Executive Drive Troy, MI 71 236 644
451 Robbins Drive Troy, MI 96 448 1,001
1035 Crooks Road Troy, MI 114 414 625
1095 Crooks Road Troy, MI 331 1,017 1,018
1416 Meijer Drive Troy, MI 94 394 390
1624 Meijer Drive Troy, MI 236 1,406 995
1972 Meijer Drive Troy, MI 315 1,301 721
1621 Northwood Drive Troy, MI 85 351 1,039
1707 Northwood Drive Troy, MI 95 262 1,183
1788 Northwood Drive Troy, MI 50 196 464
1821 Northwood Drive Troy, MI 132 523 743
1826 Northwood Drive Troy, MI 55 208 394
1864 Northwood Drive Troy, MI 57 190 469
1921 Northwood Drive Troy, MI 135 589 1,365
2277 Elliott Avenue Troy, MI 48 188 515
2451 Elliott Avenue Troy, MI 78 319 838
2730 Research Drive Rochester Hills, MI 915 4,215 717
2791 Research Drive Rochester Hills, MI 557 2,731 289
2871 Research Drive Rochester Hills, MI 324 1,487 377
2911 Research Drive Rochester Hills, MI 505 2,136 397
3011 Research Drive Rochester Hills, MI 457 2,104 349
2870 Technology Drive Rochester Hills, MI 275 1,262 237
2900 Technology Drive Rochester Hills, MI 214 977 492
2920 Technology Drive Rochester Hills, MI 159 671 144
2930 Technology Drive Rochester Hills, MI 131 594 441
2950 Technology Drive Rochester Hills, MI 178 819 302
23014 Commerce Drive Farmington Hills, MI 39 203 193
23028 Commerce Drive Farmington Hills, MI 98 507 439
23035 Commerce Drive Farmington Hills, MI 71 355 214
23042 Commerce Drive Farmintgon Hills, MI 67 277 331
23065 Commerce Drive Farmington Hills, MI 71 408 217
23070 Commerce Drive Farmington Hills, MI 112 442 668
23079 Commerce Drive Farmington Hills, MI 68 301 221
23093 Commerce Drive Farmington Hills, MI 211 1,024 788
23135 Commerce Drive Farmington Hills, MI 146 701 283
23163 Commerce Drive Farmington Hills, MI 111 513 319
23177 Commerce Drive Farmington Hills, MI 175 1,007 747
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
651 Topeka Way 198 1,187 1,385 152 1985 (p)
680 Atchison Way 198 1,164 1,363 147 1985 (p)
8122 South Park Lane - A 398 2,461 2,859 365 1986 (p)
1600 South Abilene 467 2,711 3,178 358 1986 (p)
1620 South Abilene 270 1,638 1,908 249 1986 (p)
1640 South Abilene 382 2,213 2,594 292 1986 (p)
13900 East Florida Ave 190 1,134 1,324 159 1986 (p)
4301 South Federal Boulevard 239 1,435 1,674 227 1997 (p)
14401-14492 East 33rd Place 440 2,699 3,139 389 1979 (p)
11701 East 53rd Avenue 422 2,411 2,834 319 1985 (p)
5401 Oswego Street 278 1,704 1,982 261 1985 (p)
3811 Joliet 752 4,281 5,032 427 1977 (p)
2630 West 2nd Avenue 51 291 342 39 1970 (p)
2650 West 2nd Avenue 223 1,306 1,528 181 1970 (p)
14818 West 6th Avenue Bldg A 468 3,056 3,524 511 1985 (p)
14828 West 6th Avenue Bldg B 503 3,241 3,744 488 1985 (p)
12055 E 49th Ave/4955 Peoria 305 2,006 2,310 322 1984 (p)
4940-4950 Paris 156 916 1,071 112 1984 (p)
4970 Paris 97 576 673 78 1984 (p)
5010 Paris 91 522 613 67 1984 (p)
7367 South Revere Parkway 934 5,283 6,217 690 1997 (p)
10311 W. Hampden Ave. 578 3,155 3,732 358 1999 (p)
8200 East Park Meadows Drive(i) 1,304 7,685 8,989 423 1984 (p)
3250 Quentin(i) 1,230 7,138 8,368 384 1984/2000 (p)
11585 E. 53rd Ave.(i) 1,780 10,299 12,079 325 1984 (p)
10500 East 54th Ave.(j) 1,260 7,281 8,540 231 1986 (p)
DES MOINES
2250 Delaware Ave.(s) 277 1,837 2,113 296 1975 (p)
DETROIT
2654 Elliott 57 417 474 138 1986 (p)
1731 Thorncroft 331 1,929 2,260 411 1969 (p)
1653 E. Maple 192 1,206 1,398 324 1990 (p)
47461 Clipper 122 834 955 255 1992 (p)
47522 Galleon 85 507 592 106 1990 (p)
238 Executive Drive 100 619 719 422 1973 (p)
256 Executive Drive 85 547 632 353 1974 (p)
301 Executive Drive 133 845 978 571 1974 (p)
449 Executive Drive 218 1,291 1,509 811 1975 (p)
501 Executive Drive 129 822 951 391 1984 (p)
451 Robbins Drive 192 1,353 1,545 855 1975 (p)
1035 Crooks Road 143 1,010 1,153 548 1980 (p)
1095 Crooks Road 360 2,006 2,366 995 1986 (p)
1416 Meijer Drive 121 757 878 438 1980 (p)
1624 Meijer Drive 373 2,264 2,637 1,167 1984 (p)
1972 Meijer Drive 372 1,965 2,337 972 1985 (p)
1621 Northwood Drive 215 1,260 1,475 908 1977 (p)
1707 Northwood Drive 239 1,301 1,540 695 1983 (p)
1788 Northwood Drive 103 607 710 426 1977 (p)
1821 Northwood Drive 220 1,178 1,398 804 1977 (p)
1826 Northwood Drive 103 554 657 377 1977 (p)
1864 Northwood Drive 107 609 716 419 1977 (p)
1921 Northwood Drive 291 1,797 2,089 1,179 1977 (p)
2277 Elliott Avenue 104 648 751 396 1975 (p)
2451 Elliott Avenue 164 1,072 1,235 739 1974 (p)
2730 Research Drive 903 4,945 5,847 2,411 1988 (p)
2791 Research Drive 560 3,017 3,577 1,364 1991 (p)
2871 Research Drive 327 1,862 2,188 797 1991 (p)
2911 Research Drive 504 2,534 3,038 1,154 1992 (p)
3011 Research Drive 457 2,453 2,910 1,183 1988 (p)
2870 Technology Drive 279 1,495 1,774 720 1988 (p)
2900 Technology Drive 219 1,464 1,683 735 1992 (p)
2920 Technology Drive 153 821 974 359 1992 (p)
2930 Technology Drive 138 1,027 1,166 425 1991 (p)
2950 Technology Drive 185 1,115 1,299 525 1991 (p)
23014 Commerce Drive 56 379 435 195 1983 (p)
23028 Commerce Drive 125 919 1,044 547 1983 (p)
23035 Commerce Drive 93 548 640 278 1983 (p)
23042 Commerce Drive 89 586 675 332 1983 (p)
23065 Commerce Drive 93 603 696 305 1983 (p)
23070 Commerce Drive 125 1,097 1,222 597 1983 (p)
23079 Commerce Drive 79 511 590 263 1983 (p)
23093 Commerce Drive 295 1,728 2,023 904 1983 (p)
23135 Commerce Drive 158 972 1,130 470 1986 (p)
23163 Commerce Drive 138 804 943 386 1986 (p)
23177 Commerce Drive 254 1,675 1,929 867 1986 (p)
</Table>
S-6
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
23206 Commerce Drive Farmington Hills, MI 125 531 626
23290 Commerce Drive Farmington Hills, MI 124 707 641
23370 Commerce Drive Farmington Hills, MI 59 233 165
1451 East Lincoln Avenue Madison Heights, MI 299 1,703 487
4400 Purks Drive Auburn Hills, MI 602 3,410 2,687
4177A Varsity Drive Ann Arbor, MI 90 536 95
6515 Cobb Drive Sterling Heights, MI 305 1,753 194
32450 N Avis Drive Madison Heights, MI 281 1,590 547
11866 Hubbard Livonia, MI 189 1,073 86
12050-12300 Hubbard(i) Livonia, MI 425 2,410 657
38300 Plymouth Road Livonia, MI 729 - 4,802
12707 Eckles Road Plymouth Township, MI 255 1,445 109
9300-9328 Harrison Rd Romulus, MI 147 834 226
9330-9358 Harrison Rd Romulus, MI 81 456 258
28420-28448 Highland Rd Romulus, MI 143 809 225
28450-28478 Highland Rd Romulus, MI 81 461 373
28421-28449 Highland Rd Romulus, MI 109 617 327
28451-28479 Highland Rd Romulus, MI 107 608 185
28825-28909 Highland Rd Romulus, MI 70 395 261
28933-29017 Highland Rd Romulus, MI 112 634 212
28824-28908 Highland Rd Romulus, MI 134 760 400
28932-29016 Highland Rd Romulus, MI 123 694 238
9710-9734 Harrison Rd Romulus, MI 125 706 142
9740-9772 Harrison Rd Romulus, MI 132 749 243
9840-9868 Harrison Rd Romulus, MI 144 815 165
9800-9824 Harrison Rd Romulus, MI 117 664 190
29265-29285 Airport Dr Romulus, MI 140 794 303
29185-29225 Airport Dr Romulus, MI 140 792 324
29149-29165 Airport Dr Romulus, MI 216 1,225 340
29101-29115 Airport Dr Romulus, MI 130 738 270
29031-29045 Airport Dr Romulus, MI 124 704 162
29050-29062 Airport Dr Romulus, MI 127 718 193
29120-29134 Airport Dr Romulus, MI 161 912 499
29200-29214 Airport Dr Romulus, MI 170 963 348
9301-9339 Middlebelt Rd Romulus, MI 124 703 162
26980 Trolley Industrial Drive Taylor, MI 450 2,550 931
33200 Capitol Avenue Livonia, MI 236 1,309 186
32975 Capitol Avenue Livonia, MI 135 748 94
2725 S. Industrial Highway Ann Arbor, MI 660 3,654 544
32920 Capitol Avenue Livonia, MI 76 422 86
11862 Brookfield Avenue Livonia, MI 85 471 128
11923 Brookfield Avenue Livonia, MI 120 665 459
11965 Brookfield Avenue Livonia, MI 120 665 78
34005 Schoolcraft Road Livonia, MI 107 592 177
13405 Stark Road Livonia, MI 46 254 34
1170 Chicago Road Troy, MI 249 1,380 143
1200 Chicago Road Troy, MI 268 1,483 141
450 Robbins Drive Troy, MI 166 920 110
1230 Chicago Road Troy, MI 271 1,498 142
12886 Westmore Avenue Livonia, MI 190 1,050 199
12898 Westmore Avenue Livonia, MI 190 1,050 188
33025 Industrial Road Livonia, MI 80 442 84
47711 Clipper Street Plymouth Township, MI 539 2,983 266
32975 Industrial Road Livonia, MI 160 887 178
32985 Industrial Road Livonia, MI 137 761 127
32995 Industrial Road Livonia, MI 160 887 180
12874 Westmore Avenue Livonia, MI 137 761 125
33067 Industrial Road Livonia, MI 160 887 112
1775 Bellingham Troy, MI 344 1,902 274
1785 East Maple Troy, MI 92 507 83
1807 East Maple Troy, MI 321 1,775 199
980 Chicago Troy, MI 206 1,141 103
1840 Enterprise Drive Rochester Hills, MI 573 3,170 278
1885 Enterprise Drive Rochester Hills, MI 209 1,158 110
1935-55 Enterprise Drive Rochester Hills, MI 1,285 7,144 823
5500 Enterprise Court Warren, MI 675 3,737 447
750 Chicago Road Troy, MI 323 1,790 278
800 Chicago Road Troy, MI 283 1,567 498
850 Chicago Road Troy, MI 183 1,016 178
2805 S. Industrial Highway Ann Arbor, MI 318 1,762 263
6833 Center Drive Sterling Heights, MI 467 2,583 218
32201 North Avis Drive Madison Heights, MI 345 1,911 423
1100 East Mandoline Road Madison Heights, MI 888 4,915 1,229
30081 Stephenson Highway Madison Heights, MI 271 1,499 349
1120 John A. Papalas Drive(j) Lincoln Park, MI 586 3,241 598
4872 S. Lapeer Road Lake Orion Twsp, MI 1,342 5,441 231
775 James L. Hart Parkway Ypsilanti, MI 348 1,536 864
22701 Trolley Industrial Taylor, MI 795 - 7,494
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
23206 Commerce Drive 137 1,144 1,282 711 1985 (p)
23290 Commerce Drive 210 1,261 1,472 721 1980 (p)
23370 Commerce Drive 66 390 457 238 1980 (p)
1451 East Lincoln Avenue 306 2,183 2,489 568 1967 (p)
4400 Purks Drive 612 6,087 6,699 960 1987 (p)
4177A Varsity Drive 90 631 721 180 1993 (p)
6515 Cobb Drive 305 1,947 2,251 398 1984 (p)
32450 N Avis Drive 286 2,132 2,418 505 1974 (p)
11866 Hubbard 191 1,158 1,349 197 1979 (p)
12050-12300 Hubbard(i) 428 3,065 3,493 739 1981 (p)
38300 Plymouth Road 835 4,697 5,531 567 1997 (p)
12707 Eckles Road 267 1,543 1,809 247 1990 (p)
9300-9328 Harrison Rd 154 1,053 1,207 173 1978 (p)
9330-9358 Harrison Rd 85 710 795 166 1978 (p)
28420-28448 Highland Rd 149 1,027 1,177 188 1979 (p)
28450-28478 Highland Rd 85 831 916 183 1979 (p)
28421-28449 Highland Rd 114 940 1,054 190 1980 (p)
28451-28479 Highland Rd 112 788 900 146 1980 (p)
28825-28909 Highland Rd 73 653 726 119 1981 (p)
28933-29017 Highland Rd 117 841 958 184 1982 (p)
28824-28908 Highland Rd 140 1,154 1,294 220 1982 (p)
28932-29016 Highland Rd 128 927 1,055 225 1982 (p)
9710-9734 Harrison Rd 130 843 974 165 1987 (p)
9740-9772 Harrison Rd 138 985 1,123 217 1987 (p)
9840-9868 Harrison Rd 151 974 1,124 173 1987 (p)
9800-9824 Harrison Rd 123 849 971 173 1987 (p)
29265-29285 Airport Dr 147 1,091 1,237 185 1983 (p)
29185-29225 Airport Dr 146 1,110 1,256 207 1983 (p)
29149-29165 Airport Dr 226 1,555 1,781 274 1984 (p)
29101-29115 Airport Dr 136 1,002 1,138 183 1985 (p)
29031-29045 Airport Dr 130 860 990 136 1985 (p)
29050-29062 Airport Dr 133 905 1,038 160 1986 (p)
29120-29134 Airport Dr 169 1,404 1,573 302 1986 (p)
29200-29214 Airport Dr 178 1,302 1,480 204 1985 (p)
9301-9339 Middlebelt Rd 130 859 989 138 1983 (p)
26980 Trolley Industrial Drive 463 3,468 3,931 416 1997 (p)
33200 Capitol Avenue 252 1,479 1,731 168 1977 (p)
32975 Capitol Avenue 144 832 977 105 1978 (p)
2725 S. Industrial Highway 704 4,154 4,858 643 1997 (p)
32920 Capitol Avenue 82 502 584 64 1973 (p)
11862 Brookfield Avenue 91 593 684 73 1972 (p)
11923 Brookfield Avenue 128 1,116 1,244 224 1973 (p)
11965 Brookfield Avenue 128 734 863 94 1973 (p)
34005 Schoolcraft Road 114 761 876 92 1981 (p)
13405 Stark Road 49 285 334 33 1980 (p)
1170 Chicago Road 266 1,506 1,772 174 1983 (p)
1200 Chicago Road 286 1,607 1,892 185 1984 (p)
450 Robbins Drive 178 1,019 1,196 117 1976 (p)
1230 Chicago Road 289 1,622 1,911 186 1996 (p)
12886 Westmore Avenue 202 1,236 1,439 145 1981 (p)
12898 Westmore Avenue 202 1,226 1,428 147 1981 (p)
33025 Industrial Road 85 521 606 58 1980 (p)
47711 Clipper Street 575 3,213 3,788 370 1996 (p)
32975 Industrial Road 171 1,054 1,225 131 1984 (p)
32985 Industrial Road 147 878 1,025 97 1985 (p)
32995 Industrial Road 171 1,056 1,227 116 1983 (p)
12874 Westmore Avenue 147 876 1,023 98 1984 (p)
33067 Industrial Road 171 988 1,159 120 1984 (p)
1775 Bellingham 367 2,153 2,520 293 1987 (p)
1785 East Maple 98 585 682 67 1985 (p)
1807 East Maple 342 1,953 2,295 224 1984 (p)
980 Chicago 220 1,230 1,450 142 1985 (p)
1840 Enterprise Drive 611 3,410 4,021 393 1990 (p)
1885 Enterprise Drive 223 1,254 1,477 144 1990 (p)
1935-55 Enterprise Drive 1,371 7,881 9,252 995 1990 (p)
5500 Enterprise Court 721 4,138 4,859 473 1989 (p)
750 Chicago Road 345 2,046 2,391 256 1986 (p)
800 Chicago Road 302 2,046 2,348 226 1985 (p)
850 Chicago Road 196 1,181 1,377 130 1984 (p)
2805 S. Industrial Highway 340 2,004 2,343 231 1990 (p)
6833 Center Drive 493 2,775 3,268 334 1998 (p)
32201 North Avis Drive 349 2,331 2,680 265 1974 (p)
1100 East Mandoline Road 897 6,135 7,033 712 1967 (p)
30081 Stephenson Highway 274 1,844 2,118 217 1967 (p)
1120 John A. Papalas Drive(j) 593 3,832 4,425 521 1985 (p)
4872 S. Lapeer Road 1,412 5,602 7,014 423 1999 (p)
775 James L. Hart Parkway 604 2,144 2,748 179 1999 (p)
22701 Trolley Industrial 849 7,439 8,288 514 1999 (p)
</Table>
S-7
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
1400 Allen Drive Troy, MI 209 1,154 119
1408 Allen Drive Troy, MI 151 834 150
1305 Stephenson Hwy Troy, MI 345 1,907 79
32505 Industrial Drive Madison Heights, MI 345 1,910 46
1799-1813 Northfield Drive(i) Rochester Hills, MI 481 2,665 83
GRAND RAPIDS
5050 Kendrick Court SE Grand Rapids, MI 1,721 11,433 4,581
5015 52nd Street SE Grand Rapids, MI 234 1,321 65
HOUSTON
2102-2314 Edwards Street Houston, TX 348 1,973 965
4545 Eastpark Drive Houston, TX 235 1,331 205
3351 Rauch St Houston, TX 272 1,541 250
3851 Yale St Houston, TX 413 2,343 314
3337-3347 Rauch Street Houston, TX 227 1,287 286
8505 N Loop East Houston, TX 439 2,489 133
4749-4799 Eastpark Dr Houston, TX 594 3,368 743
4851 Homestead Road Houston, TX 491 2,782 530
3365-3385 Rauch Street Houston, TX 284 1,611 164
5050 Campbell Road Houston, TX 461 2,610 275
4300 Pine Timbers Houston, TX 489 2,769 515
7901 Blankenship Houston, TX 136 772 316
2500-2530 Fairway Park Drive Houston, TX 766 4,342 589
6550 Longpointe Houston, TX 362 2,050 446
1815 Turning Basin Dr Houston, TX 487 2,761 493
1819 Turning Basin Dr Houston, TX 231 1,308 417
1805 Turning Basin Drive Houston, TX 564 3,197 631
7000 Empire Drive Houston, TX 450 2,552 904
9777 West Gulfbank Drive Houston, TX 1,217 6,899 1,129
9835A Genard Road Houston, TX 1,505 8,333 2,377
9835B Genard Road Houston, TX 245 1,357 462
10161 Harwin Drive Houston, TX 505 2,861 243
10165 Harwin Drive Houston, TX 218 1,234 408
10175 Harwin Drive Houston, TX 267 1,515 341
10325-10415 Landsbury Drive(j) Houston, TX 696 3,854 81
INDIANAPOLIS
2900 N Shadeland Avenue(s) Indianapolis, IN 2,394 13,565 112
2400 North Shadeland Indianapolis, IN 142 802 80
2402 North Shadeland Indianapolis, IN 466 2,640 383
7901 West 21st St. Indianapolis, IN 1,063 6,027 100
1445 Brookville Way Indianapolis, IN 459 2,603 516
1440 Brookville Way Indianapolis, IN 665 3,770 352
1240 Brookville Way Indianapolis, IN 247 1,402 291
1220 Brookville Way Indianapolis, IN 223 40 52
1345 Brookville Way Indianapolis, IN (d) 586 3,321 609
1350 Brookville Way Indianapolis, IN 205 1,161 162
1341 Sadlier Circle E Dr Indianapolis, IN (d) 131 743 172
1322-1438 Sadlier Circle E Dr Indianapolis, IN (d) 145 822 293
1327-1441 Sadlier Circle E Dr Indianapolis, IN (d) 218 1,234 356
1304 Sadlier Circle E Dr Indianapolis, IN (d) 71 405 149
1402 Sadlier Circle E Dr Indianapolis, IN (d) 165 934 251
1504 Sadlier Circle E Dr Indianapolis, IN (d) 219 1,238 264
1311 Sadlier Circle E Dr Indianapolis, IN (d) 54 304 114
1365 Sadlier Circle E Dr Indianapolis, IN (d) 121 688 239
1352-1354 Sadlier Circle E Dr Indianapolis, IN (d) 178 1,008 314
1335 Sadlier Circle E Dr Indianapolis, IN (d) 81 460 123
1327 Sadlier Circle E Dr Indianapolis, IN (d) 52 295 72
1425 Sadlier Circle E Dr Indianapolis, IN (d) 21 117 31
1230 Brookville Way Indianapolis, IN 103 586 49
6951 E 30th St Indianapolis, IN 256 1,449 288
6701 E 30th St Indianapolis, IN 78 443 43
6737 E 30th St Indianapolis, IN 385 2,181 412
1225 Brookville Way Indianapolis, IN 60 - 417
6555 E 30th St Indianapolis, IN 840 4,760 1,267
2432-2436 Shadeland Indianapolis, IN 212 1,199 363
8402-8440 E 33rd St Indianapolis, IN 222 1,260 348
8520-8630 E 33rd St Indianapolis, IN 326 1,848 464
8710-8768 E 33rd St Indianapolis, IN 175 993 352
3316-3346 N. Pagosa Court Indianapolis, IN 325 1,842 347
3331 Raton Court Indianapolis, IN 138 802 139
4430 Airport Expressway Indianapolis, IN 1,068 6,789 2,029
6751 E 30th St Indianapolis, IN 728 2,837 169
9200 East 146th Street Noblesville, IN 205 1,221 1,124
6575 East 30th Street Indianapolis, IN 118 - 2,107
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
1400 Allen Drive 212 1,270 1,482 65 1979 (p)
1408 Allen Drive 153 981 1,134 47 1979 (p)
1305 Stephenson Hwy 350 1,980 2,331 102 1979 (p)
32505 Industrial Drive 351 1,949 2,300 101 1979 (p)
1799-1813 Northfield Drive(i) 490 2,739 3,229 145 1980 (p)
GRAND RAPIDS
5050 Kendrick Court SE 1,721 16,014 17,735 3,410 1988 (p)
5015 52nd Street SE 234 1,386 1,620 295 1987 (p)
HOUSTON
2102-2314 Edwards Street 382 2,904 3,286 494 1961 (p)
4545 Eastpark Drive 240 1,531 1,771 191 1972 (p)
3351 Rauch St 278 1,785 2,063 240 1970 (p)
3851 Yale St 425 2,646 3,070 327 1971 (p)
3337-3347 Rauch Street 233 1,568 1,801 260 1970 (p)
8505 N Loop East 449 2,613 3,062 321 1981 (p)
4749-4799 Eastpark Dr 611 4,094 4,705 494 1979 (p)
4851 Homestead Road 504 3,299 3,803 469 1973 (p)
3365-3385 Rauch Street 290 1,769 2,059 257 1970 (p)
5050 Campbell Road 470 2,875 3,345 370 1970 (p)
4300 Pine Timbers 499 3,273 3,772 419 1980 (p)
7901 Blankenship 140 1,084 1,224 188 1972 (p)
2500-2530 Fairway Park Drive 792 4,905 5,697 711 1974 (p)
6550 Longpointe 370 2,488 2,858 346 1980 (p)
1815 Turning Basin Dr 531 3,210 3,741 395 1980 (p)
1819 Turning Basin Dr 251 1,705 1,955 197 1980 (p)
1805 Turning Basin Drive 616 3,776 4,392 475 1980 (p)
7000 Empire Drive 452 3,454 3,906 621 1980 (p)
9777 West Gulfbank Drive 1,216 8,029 9,245 1,275 1980 (p)
9835A Genard Road 1,581 10,634 12,215 736 1980 (p)
9835B Genard Road 256 1,808 2,063 147 1980 (p)
10161 Harwin Drive 511 3,098 3,609 226 1979/1981 (p)
10165 Harwin Drive 220 1,639 1,860 165 1979/1981 (p)
10175 Harwin Drive 270 1,852 2,123 240 1979/1981 (p)
10325-10415 Landsbury Drive(j) 705 3,925 4,631 50 1982 (p)
INDIANAPOLIS
2900 N Shadeland Avenue(s) 2,057 14,013 16,070 3,254 1957/1992 (p)
2400 North Shadeland 149 875 1,024 117 1970 (p)
2402 North Shadeland 489 3,001 3,490 447 1970 (p)
7901 West 21st St. 1,048 6,142 7,190 870 1985 (p)
1445 Brookville Way 476 3,103 3,579 595 1989 (p)
1440 Brookville Way 685 4,102 4,787 705 1990 (p)
1240 Brookville Way 258 1,683 1,940 347 1990 (p)
1220 Brookville Way 226 89 315 16 1990 (p)
1345 Brookville Way 601 3,914 4,515 739 1992 (p)
1350 Brookville Way 212 1,316 1,528 235 1994 (p)
1341 Sadlier Circle E Dr 136 910 1,046 183 1971/1992 (p)
1322-1438 Sadlier Circle E Dr 152 1,108 1,260 242 1971/1992 (p)
1327-1441 Sadlier Circle E Dr 225 1,583 1,807 311 1992 (p)
1304 Sadlier Circle E Dr 75 550 625 106 1971/1992 (p)
1402 Sadlier Circle E Dr 171 1,179 1,350 221 1970/1992 (p)
1504 Sadlier Circle E Dr 226 1,495 1,720 237 1971/1992 (p)
1311 Sadlier Circle E Dr 57 414 471 116 1971/1992 (p)
1365 Sadlier Circle E Dr 126 922 1,048 166 1971/1992 (p)
1352-1354 Sadlier Circle E Dr 184 1,315 1,499 256 1970/1992 (p)
1335 Sadlier Circle E Dr 85 579 664 99 1971/1992 (p)
1327 Sadlier Circle E Dr 55 364 419 59 1971/1992 (p)
1425 Sadlier Circle E Dr 23 146 169 25 1971/1992 (p)
1230 Brookville Way 109 630 739 109 1995 (p)
6951 E 30th St 265 1,728 1,993 392 1995 (p)
6701 E 30th St 82 481 564 82 1995 (p)
6737 E 30th St 398 2,579 2,977 466 1995 (p)
1225 Brookville Way 68 409 477 59 1997 (p)
6555 E 30th St 484 6,382 6,867 1,502 1969/1981 (p)
2432-2436 Shadeland 230 1,543 1,773 264 1968 (p)
8402-8440 E 33rd St 230 1,600 1,830 302 1977 (p)
8520-8630 E 33rd St 336 2,303 2,639 399 1976 (p)
8710-8768 E 33rd St 187 1,333 1,520 238 1979 (p)
3316-3346 N. Pagosa Court 335 2,179 2,514 401 1977 (p)
3331 Raton Court 138 941 1,079 149 1979 (p)
4430 Airport Expressway 1,237 8,650 9,887 1,580 1970 (p)
6751 E 30th St 741 2,992 3,734 395 1997 (p)
9200 East 146th Street 191 2,358 2,550 396 1961/1981 (p)
6575 East 30th Street 128 2,097 2,225 280 1998 (p)
</Table>
S-8
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
6585 East 30th Street Indianapolis, IN 196 - 3,347
9910 North by Northeast Blvd Fishers, IN 661 3,744 127
6041 Guion Road Indianapolis, IN 123 678 10
9210 East 146th Street Noblesville, IN 552 684 515
LOS ANGELES
5220 Fourth Street Irwindale, CA 270 1,529 55
15705 Arrow Highway Irwindale, CA 157 892 31
15709 Arrow Highway Irwindale, CA 225 1,275 32
6407-6419 Alondra Blvd. Paramount, CA 137 774 29
6423-6431 Alondra Blvd. Paramount, CA 115 650 29
15101-15141 S. Figueroa St.(i) Los Angeles, CA 1,163 6,588 352
20816-18 Higgins Court Torrance, CA 74 419 31
21136 South Wilmington Ave Carson, CA 1,234 6,994 164
19914 Via Baron Way Rancho Dominguez, CA (e) 1,590 9,010 182
2035 E. Vista Bella Way Rancho Dominguez, CA (f) 1,382 7,829 281
14912 Shoemaker Ave. Santa Fe Springs, CA 42 236 6
14920 Shoemaker Ave. Santa Fe Springs, CA 37 212 5
14928 Shoemaker Ave. Santa Fe Springs, CA 37 212 5
14938 Shoemaker Ave. Santa Fe Springs, CA 37 212 5
14944 Shoemaker Ave. Santa Fe Springs, CA 326 1,848 46
14946 Shoemaker Ave. Santa Fe Springs, CA 275 1,559 46
14948 Shoemaker Ave. Santa Fe Springs, CA 100 568 20
14141 Alondra Blvd. Santa Fe Springs, CA 2,570 14,565 184
12616 Yukon Ave. Hawthorne, CA 685 3,884 47
3355 El Segundo Blvd(j) Hawthorne, CA 267 1,510 20
12621 Cerise Hawthorne, CA 413 2,344 28
1830 W. 208th Street Torrance, CA 102 578 26
20807-09 Higgins Court Torrance, CA 105 596 28
20801-03 Higgins Court Torrance, CA 106 599 28
20817-19 S. Western Ave. Torrance, CA 95 541 30
20915-17 S. Western Ave. Torrance, CA 95 541 25
20908-10 Higgins Court Torrance, CA 96 541 26
20914-16 Higgins Court Torrance, CA 80 452 39
12700-12712 Yukon Ave.(j) Hawthorne, CA 572 3,239 50
42374 Avenida Alvarado(j) Temecula, CA 797 4,514 78
LOUISVILLE
9001 Cane Run Road Louisville, KY 524 - 5,577
9101 Cane Run Road Louisville, KY 973 - 5,748
MILWAUKEE
N25 W23050 Paul Road Pewaukee, WI 474 2,723 348
N25 W23255 Paul Road Pewaukee, WI 571 3,270 83
N27 W23293 Roundy Drive Pewaukee, WI 412 2,837 56
6523 N Sydney Place Glendale, WI 172 976 206
8800 W Bradley Milwaukee, WI 375 2,125 151
4560 N 124th Street Wauwatosa, WI 118 667 85
4410-80 North 132nd Street Butler, WI 355 - 4,023
MINNEAPOLIS/ST. PAUL
2700 Freeway Boulevard Brooklyn Center, MN (c) 392 2,318 785
6507-6545 Cecilia Circle Bloomington, MN 357 1,320 820
1275 Corporate Center Drive Eagan, MN 80 357 69
1279 Corporate Center Drive Eagan, MN 105 357 164
6201 West 111th Street Bloomington, MN 1,358 8,622 3,755
6403-6545 Cecilia Drive Bloomington, MN 366 1,363 771
6925-6943 Washington Avenue Edina, MN 117 504 888
6955-6973 Washington Avenue Edina, MN 117 486 532
7251-7267 Washington Avenue Edina, MN 129 382 467
7301-7325 Washington Avenue Edina, MN 174 391 541
7101 Winnetka Avenue North Brooklyn Park, MN 2,195 6,084 2,136
7600 Golden Triangle Drive Eden Prairie, MN 566 1,394 1,565
9901 West 74th Street Eden Prairie, MN 621 3,289 2,941
11201 Hampshire Avenue South Bloomington, MN 495 1,035 866
12220-12222 Nicollet Avenue Burnsville, MN 105 425 364
12250-12268 Nicollet Avenue Burnsville, MN 260 1,054 488
12224-12226 Nicollet Avenue Burnsville, MN 190 770 326
980 Lone Oak Road Eagan, MN 683 4,103 833
990 Lone Oak Road Eagan, MN 883 5,575 1,006
1030 Lone Oak Road Eagan, MN 456 2,703 398
1060 Lone Oak Road Eagan, MN 624 3,700 576
5400 Nathan Lane Plymouth, MN 749 4,461 657
6464 Sycamore Court Maple Grove, MN 457 2,730 279
10120 W 76th Street Eden Prairie, MN 315 1,804 1,471
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
6585 East 30th Street 196 3,346 3,543 561 1998 (p)
9910 North by Northeast Blvd 669 3,863 4,532 158 1994 (p)
6041 Guion Road 124 687 811 3 1968 (p)
9210 East 146th Street 315 1,436 1,751 140 1978 (p)
LOS ANGELES
5220 Fourth Street 274 1,580 1,854 95 2000 (p)
15705 Arrow Highway 160 921 1,081 56 1987 (p)
15709 Arrow Highway 228 1,304 1,532 74 1987 (p)
6407-6419 Alondra Blvd. 140 800 940 45 1985 (p)
6423-6431 Alondra Blvd. 118 676 794 41 1985 (p)
15101-15141 S. Figueroa St.(i) 1,175 6,927 8,102 328 1982 (p)
20816-18 Higgins Court 75 449 524 20 1981 (p)
21136 South Wilmington Ave 1,246 7,145 8,392 263 1989 (p)
19914 Via Baron Way 1,616 9,166 10,782 126 1973 (p)
2035 E. Vista Bella Way 1,406 8,086 9,491 151 1972 (p)
14912 Shoemaker Ave. 43 241 284 4 1967 (p)
14920 Shoemaker Ave. 38 217 255 4 1967 (p)
14928 Shoemaker Ave. 38 217 255 4 1967 (p)
14938 Shoemaker Ave. 38 217 255 4 1967 (p)
14944 Shoemaker Ave. 333 1,887 2,220 32 1978 (p)
14946 Shoemaker Ave. 281 1,600 1,881 27 1978 (p)
14948 Shoemaker Ave. 102 586 688 10 1978 (p)
14141 Alondra Blvd. 2,598 14,721 17,319 215 1969 (p)
12616 Yukon Ave. 692 3,924 4,616 41 1987 (p)
3355 El Segundo Blvd(j) 270 1,527 1,797 16 1959 (p)
12621 Cerise 417 2,368 2,785 25 1959 (p)
1830 W. 208th Street 103 602 705 26 1981 (p)
20807-09 Higgins Court 107 622 729 27 1981 (p)
20801-03 Higgins Court 107 625 732 27 1981 (p)
20817-19 S. Western Ave. 97 569 666 25 1981 (p)
20915-17 S. Western Ave. 97 564 661 25 1981 (p)
20908-10 Higgins Court 97 565 662 24 1981 (p)
20914-16 Higgins Court 81 489 570 21 1981 (p)
12700-12712 Yukon Ave.(j) 579 3,281 3,860 35 1960 (p)
42374 Avenida Alvarado(j) 808 4,580 5,388 10 1987 (p)
LOUISVILLE
9001 Cane Run Road 560 5,541 6,101 735 1998 (p)
9101 Cane Run Road 608 6,113 6,721 219 2000 (p)
MILWAUKEE
N25 W23050 Paul Road 484 3,061 3,545 652 1989 (p)
N25 W23255 Paul Road 582 3,342 3,924 697 1987 (p)
N27 W23293 Roundy Drive 420 2,885 3,305 602 1989 (p)
6523 N Sydney Place 176 1,179 1,355 208 1978 (p)
8800 W Bradley 388 2,263 2,651 369 1982 (p)
4560 N 124th Street 129 740 870 103 1976 (p)
4410-80 North 132nd Street 359 4,019 4,378 209 1999 (p)
MINNEAPOLIS/ST. PAUL
2700 Freeway Boulevard 415 3,080 3,495 694 1981 (p)
6507-6545 Cecilia Circle 386 2,111 2,497 1,182 1980 (p)
1275 Corporate Center Drive 93 414 506 195 1990 (p)
1279 Corporate Center Drive 109 518 626 215 1990 (p)
6201 West 111th Street 1,499 12,237 13,735 4,308 1987 (p)
6403-6545 Cecilia Drive 395 2,105 2,500 1,215 1980 (p)
6925-6943 Washington Avenue 237 1,272 1,509 974 1972 (p)
6955-6973 Washington Avenue 207 928 1,135 833 1972 (p)
7251-7267 Washington Avenue 182 795 978 708 1972 (p)
7301-7325 Washington Avenue 193 913 1,106 1,004 1972 (p)
7101 Winnetka Avenue North 2,228 8,187 10,415 4,021 1990 (p)
7600 Golden Triangle Drive 615 2,910 3,525 1,688 1989 (p)
9901 West 74th Street 639 6,212 6,851 2,305 1983/88 (p)
11201 Hampshire Avenue South 502 1,895 2,396 1,047 1986 (p)
12220-12222 Nicollet Avenue 114 780 894 315 1989/90 (p)
12250-12268 Nicollet Avenue 296 1,506 1,802 589 1989/90 (p)
12224-12226 Nicollet Avenue 207 1,079 1,286 430 1989/90 (p)
980 Lone Oak Road 683 4,936 5,619 1,457 1992 (p)
990 Lone Oak Road 873 6,591 7,463 1,779 1989 (p)
1030 Lone Oak Road 456 3,101 3,557 658 1988 (p)
1060 Lone Oak Road 624 4,276 4,901 1,103 1988 (p)
5400 Nathan Lane 757 5,110 5,867 898 1990 (p)
6464 Sycamore Court 457 3,009 3,466 697 1990 (p)
10120 W 76th Street 315 3,274 3,590 648 1987 (p)
</Table>
S-9
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
7615 Golden Triangle Eden Prairie, MN 268 1,532 1,141
7625 Golden Triangle Eden Prairie, MN 415 2,375 924
2605 Fernbrook Lane North Plymouth, MN 443 2,533 438
12155 Nicollet Ave. Burnsville, MN 286 - 1,890
6655 Wedgewood Road Maple Grove, MN 1,466 8,342 3,176
900 Apollo Road Eagan, MN 1,029 5,855 1,104
7316 Aspen Lane North Brooklyn Park, MN 368 2,156 911
953 Westgate Drive Brooklyn Center, MN 193 1,178 72
73rd Avenue North Brooklyn Park, MN 504 2,856 136
1905 W Country Road C Roseville, MN 402 2,278 75
2720 Arthur Street Roseville, MN 824 4,671 79
10205 51st Avenue North Plymouth, MN 180 1,020 89
4100 Peavey Road Chaska, MN 399 2,261 645
11300 Hamshire Ave South Bloomington, MN 527 2,985 1,836
375 Rivertown Drive Woodbury, MN 1,083 6,135 2,741
5205 Highway 169 Plymouth, MN 446 2,525 1,076
6451-6595 Citywest Parkway Eden Prairie, MN 525 2,975 827
7500-7546 Washington Square Eden Prairie, MN 229 1,300 112
7550-7558 Washington Square Eden Prairie, MN 153 867 41
5240-5300 Valley Industrial Blvd S Shakopee, MN 362 2,049 776
7125 Northland Terrace Brooklyn Park, MN 660 3,740 771
6900 Shady Oak Road Eden Prairie, MN 310 1,756 438
6477-6525 City West Parkway Eden Prairie, MN 810 4,590 381
1157 Valley Park Drive Shakopee, MN 760 - 6,067
500-530 Kasota Avenue SE Minneapolis, MN 415 2,354 674
770-786 Kasota Avenue SE Minneapolis, MN 333 1,888 462
800 Kasota Avenue SE Minneapolis, MN 524 2,971 640
2530-2570 Kasota Avenue St. Paul, MN 407 2,308 718
504 Malcom Ave. SE Minneapolis, MN 757 - 6,117
5555 12th Ave. East Shakopee, MN 1,157 - 3,396
NASHVILLE
1621 Heil Quaker Boulevard Nashville, TN (c) 413 2,383 683
417 Harding Industrial Drive Nashville, TN 763 4,965 1,222
3099 Barry Drive Portland, TN 418 2,368 71
3150 Barry Drive Portland, TN 941 5,333 289
5599 Highway 31 West Portland, TN 564 3,196 78
1650 Elm Hill Pike Nashville, TN 329 1,867 145
1102 Appleton Drive Nashville, TN 154 873 26
1931 Air Lane Drive Nashville, TN 489 2,785 271
470 Metroplex Drive(i) Nashville, TN 619 3,507 1,326
1150 Antiock Pike Nashville, TN 661 3,748 207
4640 Cummings Park Nashville, TN 360 2,040 147
211 Nesbitt North Nashville, TN 399 2,261 107
211 Nesbitt South Nashville, TN 400 2,266 106
211 Nesbitt West Nashville, TN 217 1,232 19
556 Metroplex Drive Nashville, TN 227 1,285 215
7600 Eastgate Blvd. Lebanon, TN 1,375 - 3
NORTHERN NEW JERSEY
60 Ethel Road West Piscataway, NJ 252 1,426 329
70 Ethel Road West Piscataway, NJ 431 2,443 458
601-629 Montrose Avenue SouthPlainfield, NJ 487 2,762 616
9 Princess Road Lawrenceville, NJ 221 1,254 134
11 Princess Road Lawrenceville, NJ 491 2,780 330
15 Princess Road Lawrenceville, NJ 234 1,328 287
17 Princess Road Lawrenceville, NJ 342 1,936 81
220 Hanover Avenue Hanover, NJ 1,361 7,715 600
244 Shefield Street Mountainside, NJ 201 1,141 296
31 West Forest Street(i) Englewood, NJ 941 5,333 882
25 World's Fair Drive Franklin, NJ 285 1,616 207
14 World's Fair Drive Franklin, NJ 483 2,735 473
16 World's Fair Drive Franklin, NJ 174 988 226
18 World's Fair Drive Franklin, NJ 123 699 84
23 World's Fair Drive Franklin, NJ 134 758 114
12 World's Fair Drive Franklin, NJ 572 3,240 361
49 Napoleon Court Franklin, NJ 230 1,306 69
50 NapoleanCourt Franklin, NJ 149 842 42
22 World's Fair Drive Franklin, NJ 364 2,064 293
26 World's Fair Drive Franklin, NJ 361 2,048 203
24 World's Fair Drive Franklin, NJ 347 1,968 365
20 World's Fair Drive Lot 13 Sumerset, NJ 9 - 2,810
10 New Maple Road Pine Brook, NJ 2,250 12,750 186
60 Chapin Road Pine Brook, NJ 2,123 12,028 1,840
45 Route 46 Pine Brook, NJ 969 5,491 295
43 Route 46 Pine Brook, NJ 474 2,686 204
39 Route 46 Pine Brook, NJ 260 1,471 85
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
7615 Golden Triangle 268 2,673 2,941 727 1987 (p)
7625 Golden Triangle 415 3,299 3,714 691 1987 (p)
2605 Fernbrook Lane North 445 2,969 3,414 821 1987 (p)
12155 Nicollet Ave. 288 1,888 2,176 392 1995 (p)
6655 Wedgewood Road 1,466 11,518 12,983 1,810 1989 (p)
900 Apollo Road 1,030 6,959 7,989 1,275 1970 (p)
7316 Aspen Lane North 377 3,057 3,434 687 1978 (p)
953 Westgate Drive 193 1,250 1,444 289 1991 (p)
73rd Avenue North 512 2,984 3,496 507 1995 (p)
1905 W Country Road C 410 2,345 2,755 395 1993 (p)
2720 Arthur Street 832 4,742 5,574 800 1995 (p)
10205 51st Avenue North 187 1,102 1,289 192 1990 (p)
4100 Peavey Road 415 2,891 3,305 581 1988 (p)
11300 Hamshire Ave South 541 4,807 5,348 834 1983 (p)
375 Rivertown Drive 1,503 8,456 9,959 1,170 1996 (p)
5205 Highway 169 739 3,307 4,046 639 1960 (p)
6451-6595 Citywest Parkway 538 3,789 4,327 961 1984 (p)
7500-7546 Washington Square 235 1,406 1,641 214 1975 (p)
7550-7558 Washington Square 157 905 1,062 142 1975 (p)
5240-5300 Valley Industrial Blvd S 371 2,815 3,186 491 1973 (p)
7125 Northland Terrace 767 4,404 5,171 626 1996 (p)
6900 Shady Oak Road 340 2,164 2,504 291 1980 (p)
6477-6525 City West Parkway 819 4,961 5,781 694 1984 (p)
1157 Valley Park Drive 888 5,939 6,827 484 1997 (p)
500-530 Kasota Avenue SE 432 3,011 3,444 370 1976 (p)
770-786 Kasota Avenue SE 347 2,336 2,683 269 1976 (p)
800 Kasota Avenue SE 597 3,538 4,134 444 1976 (p)
2530-2570 Kasota Avenue 465 2,968 3,433 503 1976 (p)
504 Malcom Ave. SE 936 5,938 6,874 355 1997 (p)
5555 12th Ave. East 588 3,964 4,553 326 2000 (p)
NASHVILLE
1621 Heil Quaker Boulevard 430 3,050 3,479 661 1975 (p)
417 Harding Industrial Drive 763 6,188 6,950 1,861 1972 (p)
3099 Barry Drive 421 2,436 2,857 383 1995 (p)
3150 Barry Drive 980 5,583 6,563 876 1993 (p)
5599 Highway 31 West 571 3,267 3,838 511 1995 (p)
1650 Elm Hill Pike 332 2,009 2,341 302 1984 (p)
1102 Appleton Drive 154 899 1,053 126 1984 (p)
1931 Air Lane Drive 493 3,051 3,544 476 1984 (p)
470 Metroplex Drive(i) 626 4,826 5,452 814 1986 (p)
1150 Antiock Pike 669 3,949 4,617 508 1987 (p)
4640 Cummings Park 365 2,181 2,547 210 1986 (p)
211 Nesbitt North 404 2,363 2,767 173 1983 (p)
211 Nesbitt South 405 2,367 2,772 233 1983 (p)
211 Nesbitt West 220 1,249 1,469 94 1985 (p)
556 Metroplex Drive 231 1,496 1,727 61 1983 (p)
7600 Eastgate Blvd. 1,375 3 1,378 0 2002 (p)
NORTHERN NEW JERSEY
60 Ethel Road West 264 1,743 2,007 269 1982 (p)
70 Ethel Road West 451 2,881 3,333 410 1979 (p)
601-629 Montrose Avenue 512 3,353 3,865 509 1974 (p)
9 Princess Road 234 1,375 1,609 201 1985 (p)
11 Princess Road 516 3,084 3,600 502 1985 (p)
15 Princess Road 247 1,603 1,849 388 1986 (p)
17 Princess Road 345 2,013 2,358 312 1986 (p)
220 Hanover Avenue 1,420 8,257 9,677 1,171 1987 (p)
244 Shefield Street 210 1,428 1,638 256 1965/1986 (p)
31 West Forest Street(i) 975 6,182 7,157 988 1978 (p)
25 World's Fair Drive 297 1,811 2,108 246 1986 (p)
14 World's Fair Drive 503 3,188 3,692 505 1980 (p)
16 World's Fair Drive 183 1,204 1,388 154 1981 (p)
18 World's Fair Drive 129 776 905 102 1982 (p)
23 World's Fair Drive 140 865 1,005 132 1982 (p)
12 World's Fair Drive 593 3,579 4,172 483 1981 (p)
49 Napoleon Court 238 1,367 1,605 183 1982 (p)
50 NapoleanCourt 154 879 1,033 112 1982 (p)
22 World's Fair Drive 375 2,346 2,721 404 1983 (p)
26 World's Fair Drive 377 2,234 2,612 322 1984 (p)
24 World's Fair Drive 362 2,318 2,680 337 1984 (p)
20 World's Fair Drive Lot 13 691 2,128 2,819 280 1999 (p)
10 New Maple Road 2,272 12,914 15,186 726 1973/1999 (p)
60 Chapin Road 2,143 13,847 15,990 1,029 1977/2000 (p)
45 Route 46 978 5,777 6,755 365 1974/1987 (p)
43 Route 46 479 2,885 3,364 166 1974/1987 (p)
39 Route 46 262 1,553 1,815 89 1970 (p)
</Table>
S-10
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
26 Chapin Road Pine Brook, NJ 956 5,415 131
30 Chapin Road Pine Brook, NJ 960 5,440 226
20 Hook Mountain Road Pine Brook, NJ 1,507 8,542 926
30 Hook Mountain Road Pine Brook, NJ 389 2,206 313
55 Route 46 Pine Brook, NJ 396 2,244 94
16 Chapin Rod Pine Brook, NJ 885 5,015 133
20 Chapin Road Pine Brook, NJ 1,134 6,426 248
Sayreville Lot 4 Sayreville, NJ - - 0
400 Raritan Center Parkway Edison, NJ 829 4,722 315
300 Columbus Circle Edison, NJ 1,257 7,122 174
400 Apgar Franklin Township, NJ 780 4,420 129
500 Apgar Franklin Township, NJ 361 2,044 211
201 Circle Dr. North Piscataway, NJ 840 4,760 396
1 Pearl Ct. Allendale, NJ 623 3,528 172
2 Pearl Ct. Allendale, NJ 255 1,445 970
3 Pearl Ct. Allendale, NJ 440 2,491 121
4 Pearl Ct. Allendale, NJ 450 2,550 124
5 Pearl Ct. Allendale, NJ 505 2,860 139
6 Pearl Ct. Allendale, NJ 1,160 6,575 111
7 Pearl Ct. Allendale, NJ 513 2,907 49
59 Route 17 Allendale, NJ 518 2,933 143
PHILADELPHIA
212 Welsh Pool Road Exton, PA 160 886 163
230-240 Welsh Pool Road Exton, PA 154 851 150
264 Welsh Pool Road Exton, PA 147 811 140
254 Welsh Pool Road Exton, PA 152 842 422
256 Welsh Pool Road Exton, PA 82 452 273
213 Welsh Pool Road Exton, PA 149 827 258
251 Welsh Pool Road Exton, PA 144 796 115
253-255 Welsh Pool Road Exton, PA 113 626 137
151-161 Philips Road Exton, PA 191 1,059 247
210 Philips Road Exton, PA 182 1,005 231
215 Welsh Pool Road Exton, PA 67 372 181
217 Welsh Pool Road Exton, PA 64 357 62
216 Philips Road Exton, PA 199 1,100 268
202 Philips Road Exton, PA 174 966 203
20 McDonald Blvd Aston, PA 184 1,016 61
30 McDonald Blvd Aston, PA 135 748 273
2994-96 Samuel Drive Bensalem, PA 952 5,396 257
964 Postal Road Lehigh, PA 215 1,216 67
966 Postal Road Lehigh, PA 268 1,517 79
999 Postal Road Lehigh, PA 439 2,486 167
7331 William Avenue Lehigh, PA 311 1,764 92
7346 Penn Drive Lehigh, PA 413 2,338 138
7350 William Ave. Lehigh, PA 552 3,128 490
7377 William Ave. Lehigh, PA 290 1,645 84
7072 Snow Drift Lehigh, PA 288 1,632 310
2000 Cabot Boulevard West Langhorne, PA 414 2,346 80
2005 Cabot Boulevard West Langhorne, PA 315 1,785 92
2010 Cabot Boulevard West Langhorne, PA 513 2,907 262
2200 Cabot Boulevard West Langhorne, PA 428 2,427 96
2260-2270 Cabot Boulevard West Langhorne, PA 361 2,044 252
3000 Cabot Boulevard West Langhorne, PA 509 2,886 216
180 Wheeler Court Langhorne, PA 447 2,533 72
2512 Metropolitan Drive Trevose, PA 242 1,369 49
2510 Metropolitan Drive Trevose, PA 244 1,381 37
2515 Metropolitan Drive Trevose, PA 259 1,466 41
2555 Metropolitan Drive Trevose, PA 347 1,968 55
2450 Metropolitan Drive Trevose, PA 571 3,234 108
2495 Metropolitan Drive Trevose, PA 551 3,124 100
4667 Somerton Road Trevose, PA 637 3,608 431
835 Wheeler Way Langhorne, PA 293 1,658 179
PHOENIX
1045 South Edward Drive Tempe, AZ 390 2,160 47
46 N. 49th Ave. Phoenix, AZ 301 1,704 51
PORTLAND
5687 International Way(k) Milwaukee, OR 430 2,385 267
5795 SW Jean Road(j) Lake Oswego, OR 427 2,362 363
12130 NE Ainsworth Circle(i) Portland, OR 523 2,898 301
5509 NW 122nd Ave.(i) Milwaukee, OR 244 1,351 80
6105-6113 NE 92nd Avenue(k) Portland, OR 884 4,891 684
8727 NE Marx Drive(j) Portland, OR 580 3,210 678
3388 SE 20th Street Portland, OR 73 405 45
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
26 Chapin Road 965 5,536 6,501 311 1983 (p)
30 Chapin Road 969 5,657 6,626 350 1983 (p)
20 Hook Mountain Road 1,534 9,442 10,976 513 1972/1984 (p)
30 Hook Mountain Road 396 2,512 2,908 141 1972/1987 (p)
55 Route 46 403 2,331 2,734 137 1978/1994 (p)
16 Chapin Rod 901 5,133 6,033 289 1987 (p)
20 Chapin Road 1,154 6,654 7,808 392 1987 (p)
Sayreville Lot 4 - - - - 2001 (p)
400 Raritan Center Parkway 836 5,031 5,867 138 1983 (p)
300 Columbus Circle 1,269 7,284 8,553 198 1983 (p)
400 Apgar 796 4,534 5,329 85 1987 (p)
500 Apgar 368 2,248 2,616 49 1987 (p)
201 Circle Dr. North 857 5,139 5,996 93 1987 (p)
1 Pearl Ct. 648 3,674 4,322 23 1978 (p)
2 Pearl Ct. 403 2,267 2,670 9 1979 (p)
3 Pearl Ct. 458 2,593 3,051 16 1978 (p)
4 Pearl Ct. 469 2,655 3,124 17 1979 (p)
5 Pearl Ct. 526 2,979 3,504 19 1977 (p)
6 Pearl Ct. 1,177 6,669 7,846 42 1980 (p)
7 Pearl Ct. 520 2,948 3,469 19 1979 (p)
59 Route 17 539 3,054 3,593 19 1979 (p)
PHILADELPHIA
212 Welsh Pool Road 176 1,033 1,209 121 1975/1997 (p)
230-240 Welsh Pool Road 170 985 1,155 127 1975/1997 (p)
264 Welsh Pool Road 162 936 1,098 149 1975/1996 (p)
254 Welsh Pool Road 184 1,232 1,416 225 1975/1998 (p)
256 Welsh Pool Road 94 713 807 88 1975/1999 (p)
213 Welsh Pool Road 173 1,061 1,234 159 1975/1998 (p)
251 Welsh Pool Road 159 896 1,055 106 1975/1991 (p)
253-255 Welsh Pool Road 125 751 876 100 1975/1980 (p)
151-161 Philips Road 229 1,268 1,497 156 1975/1990 (p)
210 Philips Road 198 1,220 1,418 221 1975/1998 (p)
215 Welsh Pool Road 80 541 620 123 1975/1998 (p)
217 Welsh Pool Road 71 412 483 48 1975/1997 (p)
216 Philips Road 220 1,347 1,567 183 1985 (p)
202 Philips Road 214 1,129 1,343 132 1972/1991 (p)
20 McDonald Blvd 192 1,069 1,261 115 1988 (p)
30 McDonald Blvd 160 995 1,156 132 1988 (p)
2994-96 Samuel Drive 981 5,625 6,605 407 1974 (p)
964 Postal Road 224 1,273 1,497 56 1986 (p)
966 Postal Road 279 1,585 1,864 69 1987 (p)
999 Postal Road 458 2,634 3,092 115 1988 (p)
7331 William Avenue 325 1,842 2,167 81 1989 (p)
7346 Penn Drive 430 2,458 2,888 107 1988 (p)
7350 William Ave. 576 3,595 4,170 155 1989 (p)
7377 William Ave. 303 1,716 2,019 75 1989 (p)
7072 Snow Drift 300 1,930 2,230 82 1975 (p)
2000 Cabot Boulevard West 424 2,416 2,840 55 1984 (p)
2005 Cabot Boulevard West 322 1,870 2,192 42 1984 (p)
2010 Cabot Boulevard West 525 3,157 3,682 70 1984 (p)
2200 Cabot Boulevard West 438 2,512 2,951 57 1979 (p)
2260-2270 Cabot Boulevard West 369 2,288 2,657 50 1980 (p)
3000 Cabot Boulevard West 521 3,089 3,611 71 1986 (p)
180 Wheeler Court 458 2,594 3,052 59 1974 (p)
2512 Metropolitan Drive 248 1,411 1,659 32 1981 (p)
2510 Metropolitan Drive 249 1,413 1,662 32 1981 (p)
2515 Metropolitan Drive 265 1,501 1,766 34 1974 (p)
2555 Metropolitan Drive 355 2,014 2,370 46 1981 (p)
2450 Metropolitan Drive 586 3,328 3,913 76 1983 (p)
2495 Metropolitan Drive 566 3,209 3,775 73 1981 (p)
4667 Somerton Road 652 4,025 4,676 87 1974 (p)
835 Wheeler Way 319 1,810 2,129 15 1974 (p)
PHOENIX
1045 South Edward Drive 394 2,203 2,597 193 1976 (p)
46 N. 49th Ave. 306 1,750 2,056 7 1986 (p)
PORTLAND
5687 International Way(k) 439 2,643 3,082 344 1974 (p)
5795 SW Jean Road(j) 433 2,719 3,152 320 1985 (p)
12130 NE Ainsworth Circle(i) 531 3,192 3,723 405 1986 (p)
5509 NW 122nd Ave.(i) 248 1,427 1,675 164 1995 (p)
6105-6113 NE 92nd Avenue(k) 954 5,505 6,459 599 1978/1986 (p)
8727 NE Marx Drive(j) 602 3,866 4,468 483 1987 (p)
3388 SE 20th Street 76 447 523 56 1981 (p)
</Table>
S-11
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
5962-5964 NE 87th Avenue Portland, OR 72 398 75
11620 NE Ainsworth Portland, OR 152 839 34
11824 NE Ainsworth Circle Portland, OR 166 916 81
12124 NE Ainsworth Circle Portland, OR 207 1,148 49
11632 NE Ainsworth Circle Portland, OR 799 4,422 940
SALT LAKE CITY
2255 South 300 West(n) Salt Lake City, UT 618 3,504 299
512 Lawndale Drive(o) Salt Lake City, UT 2,779 15,749 2,706
1270 West 2320 South West Valley, UT 138 784 129
1275 West 2240 South West Valley, UT 395 2,241 95
1288 West 2240 South West Valley, UT 119 672 93
2235 South 1300 West West Valley, UT 198 1,120 248
1293 West 2200 South West Valley, UT 158 896 209
1279 West 2200 South West Valley, UT 198 1,120 56
1272 West 2240 South West Valley, UT 336 1,905 324
1149 West 2240 South West Valley, UT 217 1,232 57
1142 West 2320 South West Valley, UT 217 1,232 240
1152 West 2240 South West Valley, UT 2,067 - 3,964
SOUTHERN NEW JERSEY
2-5 North Olnev Ave. Cherry Hill, NJ 284 1,524 117
2 Springdale Road Cherry Hill, NJ 127 701 96
4 Springdale Road(i) Cherry Hill, NJ 335 1,853 696
8 Springdale Road Cherry Hill, NJ 259 1,436 345
2050 Springdale Road Cherry Hill, NJ 279 1,545 1,224
1 Esterbrook Lane Cherry Hill, NJ 43 238 24
16 Springdale Road Cherry Hill, NJ 241 1,336 119
5 Esterbrook Lane Cherry Hill, NJ 241 1,336 221
2 Pin Oak Lane Cherry Hill, NJ 317 1,757 276
6 Esterbrook Lane Cherry Hill, NJ 165 914 34
3 Computer Drive Cherry Hill, NJ 500 2,768 458
28 Springdale Road Cherry Hill, NJ 192 1,060 197
3 Esterbrook Lane Cherry Hill, NJ 199 1,102 444
4 Esterbrook Lane Cherry Hill, NJ 234 1,294 30
26 Springdale Road Cherry Hill, NJ 227 1,257 345
1 Keystone Ave. Cherry Hill, NJ 227 1,223 769
1919 Springdale Road Cherry Hill, NJ 232 1,286 57
21 Olnev Ave. Cherry Hill, NJ 69 380 62
19 Olnev Ave. Cherry Hill, NJ 202 1,119 1,157
2 Keystone Ave. Cherry Hill, NJ 216 1,194 435
18 Olnev Ave. Cherry Hill, NJ 250 1,382 78
2030 Springdale Rod Cherry Hill, NJ 526 2,914 1,392
55 Carnegie Drive Cherry Hill, NJ 550 3,047 158
5 Carnegie Plaza Cherry Hill, NJ 739 4,109 239
111 Whittendale Drive Morrestown, NJ 515 2,916 6
9 Whittendale Morrestown, NJ 337 1,911 39
1931 Olney Road Cherry Hill, NJ 262 1,486 39
ST. LOUIS
8921-8971 Fost Avenue Hazelwood, MO (c) 431 2,479 71
9043-9083 Frost Avenue Hazelwood, MO (c) 319 1,838 708
2121 Chapin Industrial Drive Vinita Park, MO 606 4,384 1,343
10431-10449 Midwest Industrial Blvd Olivette, MO 237 1,360 569
10751 Midwest Industrial Boulevard Olivette, MO 193 1,119 104
6951 N Hanley(i) Hazelwood, MO 405 2,295 1,886
4560 Anglum Road Hazelwood, MO 150 849 216
1037 Warson - Bldg A St. Louis, MO 246 1,359 30
1037 Warson - Bldg B St. Louis, MO 380 2,103 52
1037 Warson - Bldg C St. Louis, MO 303 1,680 37
1037 Warson - Bldg D St. Louis, MO 353 1,952 43
TAMPA
6614 Adamo Drive Tampa, FL 177 1,005 62
6204 Benjamin Road Tampa, FL 432 2,445 333
6206 Benjamin Road Tampa, FL 397 2,251 278
6302 Benjamin Road Tampa, FL 214 1,212 190
6304 Benjamin Road Tampa, FL 201 1,138 205
6306 Benjamin Road Tampa, FL 257 1,457 396
6308 Benjamin Road Tampa, FL 345 1,958 231
5313 Johns Road Tampa, FL 204 1,159 103
5602 Thompson Center Court Tampa, FL 115 652 133
5411 Johns Road Tampa, FL 230 1,304 177
5525 Johns Road Tampa, FL 192 1,086 66
5607 Johns Road Tampa, FL 102 579 62
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
5962-5964 NE 87th Avenue 75 470 545 47 1979 (p)
11620 NE Ainsworth 155 869 1,024 97 1992 (p)
11824 NE Ainsworth Circle 169 993 1,162 120 1992 (p)
12124 NE Ainsworth Circle 212 1,193 1,405 131 1984 (p)
11632 NE Ainsworth Circle 925 5,237 6,161 543 1990 (p)
SALT LAKE CITY
2255 South 300 West(n) 612 3,809 4,421 508 1980 (p)
512 Lawndale Drive(o) 2,774 18,460 21,233 2,682 1981 (p)
1270 West 2320 South 143 908 1,051 122 1986/92 (p)
1275 West 2240 South 408 2,323 2,731 288 1986/92 (p)
1288 West 2240 South 123 761 883 103 1986/92 (p)
2235 South 1300 West 204 1,362 1,566 194 1986/92 (p)
1293 West 2200 South 163 1,100 1,263 168 1986/92 (p)
1279 West 2200 South 204 1,170 1,374 147 1986/92 (p)
1272 West 2240 South 347 2,217 2,564 315 1986/92 (p)
1149 West 2240 South 225 1,282 1,506 159 1986/92 (p)
1142 West 2320 South 225 1,465 1,690 242 1997 (p)
1152 West 2240 South 2,114 3,918 6,032 589 1999 (p)
SOUTHERN NEW JERSEY
2-5 North Olnev Ave. 282 1,643 1,925 188 1963/85 (p)
2 Springdale Road 126 798 924 87 1968 (p)
4 Springdale Road(i) 332 2,552 2,885 305 1963/85 (p)
8 Springdale Road 258 1,783 2,041 203 1966 (p)
2050 Springdale Road 277 2,770 3,047 136 1965 (p)
1 Esterbrook Lane 43 262 305 30 1965 (p)
16 Springdale Road 240 1,456 1,696 166 1967 (p)
5 Esterbrook Lane 240 1,559 1,798 171 1966/88 (p)
2 Pin Oak Lane 314 2,036 2,350 250 1968 (p)
6 Esterbrook Lane 164 949 1,113 111 1966 (p)
3 Computer Drive 492 3,233 3,725 375 1966 (p)
28 Springdale Road 190 1,259 1,449 133 1967 (p)
3 Esterbrook Lane 198 1,547 1,745 172 1968 (p)
4 Esterbrook Lane 232 1,326 1,558 157 1969 (p)
26 Springdale Road 226 1,603 1,829 167 1968 (p)
1 Keystone Ave. 218 2,000 2,219 208 1969 (p)
1919 Springdale Road 230 1,345 1,575 158 1970 (p)
21 Olnev Ave. 68 442 510 48 1969 (p)
19 Olnev Ave. 200 2,278 2,478 235 1971 (p)
2 Keystone Ave. 214 1,631 1,844 175 1970 (p)
18 Olnev Ave. 247 1,462 1,709 170 1974 (p)
2030 Springdale Rod 523 4,309 4,832 505 1977 (p)
55 Carnegie Drive 547 3,209 3,755 373 1988 (p)
5 Carnegie Plaza 733 4,354 5,087 454 1987 (p)
111 Whittendale Drive 514 2,922 3,436 221 1991/96 (p)
9 Whittendale 343 1,944 2,287 77 2000 (p)
1931 Olney Road 267 1,520 1,787 7 1969 (p)
ST. LOUIS
8921-8971 Fost Avenue 431 2,550 2,981 541 1971 (p)
9043-9083 Frost Avenue 319 2,546 2,865 625 1970/77 (p)
2121 Chapin Industrial Drive 614 5,720 6,333 5,631 1969/94 (p)
10431-10449 Midwest Industrial Blvd 237 1,929 2,166 418 1967 (p)
10751 Midwest Industrial Boulevard 194 1,223 1,416 267 1965 (p)
6951 N Hanley(i) 419 4,167 4,586 1,076 1965 (p)
4560 Anglum Road 161 1,055 1,215 241 1970 (p)
1037 Warson - Bldg A 250 1,385 1,635 26 1968 (p)
1037 Warson - Bldg B 387 2,148 2,534 40 1968 (p)
1037 Warson - Bldg C 309 1,711 2,020 32 1968 (p)
1037 Warson - Bldg D 359 1,988 2,347 37 1968 (p)
TAMPA
6614 Adamo Drive 181 1,064 1,244 141 1967 (p)
6204 Benjamin Road 454 2,755 3,209 366 1982 (p)
6206 Benjamin Road 416 2,510 2,926 332 1983 (p)
6302 Benjamin Road 224 1,392 1,616 208 1983 (p)
6304 Benjamin Road 209 1,335 1,544 218 1984 (p)
6306 Benjamin Road 269 1,841 2,110 312 1984 (p)
6308 Benjamin Road 362 2,173 2,534 289 1984 (p)
5313 Johns Road 213 1,253 1,466 163 1991 (p)
5602 Thompson Center Court 120 779 899 122 1972 (p)
5411 Johns Road 241 1,470 1,710 241 1997 (p)
5525 Johns Road 200 1,144 1,344 148 1993 (p)
5607 Johns Road 110 634 744 81 1991 (p)
</Table>
S-12
<Table>
<Caption>
COSTS
CAPITALIZED
SUBSEQUENT TO
(B) ACQUISITION OR
INITIAL COST COMPLETION
LOCATION (A) ----------------------- AND VALUATION
BUILDING ADDRESS (CITY/STATE) ENCUMBRANCES LAND BUILDINGS PROVISION
- ---------------- ------------ ------------ -------- ---------- --------------
5709 Johns Road Tampa, FL 192 1,086 141
5711 Johns Road Tampa, FL 243 1,376 180
5453 W Waters Avenue Tampa, FL 71 402 99
5455 W Waters Avenue Tampa, FL 307 1,742 178
5553 W Waters Avenue Tampa, FL 307 1,742 202
5501 W Waters Avenue Tampa, FL 154 871 80
5503 W Waters Avenue Tampa, FL 71 402 52
5555 W Waters Avenue Tampa, FL 213 1,206 105
5557 W Waters Avenue Tampa, FL 59 335 33
5463 W Waters Avenue Tampa, FL (h) 497 2,751 456
5903 Johns Road Tampa, FL 88 497 74
5461 W Waters Tampa, FL 261 - 1,186
5471 W. Waters Tampa, FL 572 798 173
5505 Johns Road #7 Tampa, FL 228 - 1,396
5481 W. Waters Avenue Tampa, FL 558 - 2,297
5483 W. Waters Avenue Tampa, FL 457 - 1,940
6702-6712 Benjamin Road(m) Tampa, FL 639 3,536 406
5905 Breckenridge Parkway Tampa, FL 189 1,070 36
5907 Breckenridge Parkway Tampa, FL 61 345 10
5909 Breckenridge Parkway Tampa, FL 173 980 36
5911 Breckenridge Parkway Tampa, FL 308 1,747 32
5910 Breckenridge Parkway Tampa, FL 436 2,472 37
5912 Breckenridge Parkway Tampa, FL 460 2,607 39
4515-4519 George Road Tampa, FL 633 3,587 86
6301 Benjamin Road Tampa, FL 292 1,657 100
5723 Benjamin Road Tampa, FL 406 2,301 43
6313 Benjamin Road Tampa, FL 229 1,296 26
5801 Benjamin Road Tampa, FL 564 3,197 51
5802 Benjamin Road Tampa, FL 686 3,889 202
5925 Benjamin Road Tampa, FL 328 1,859 29
OTHER
2800 Airport Road(l) Denton, TX 369 1,935 1,572
3501 Maple Street Abilene, TX 67 1,057 1,000
4200 West Harry Street(j) Wichita, KS 193 2,224 1,751
Industrial Park No. 2 West Lebanon, NH 723 5,208 175
6601 S. 33rd Street McAllen, TX 231 1,276 32
9601A Dessau Road Austin, TX 255 - 1,860
9601B Dessau Road Austin, TX 248 - 2,053
9601C Dessau Road Austin, TX 248 - 2,691
555 Vista Blvd Sparks, NV 1,693 9,592 121
REDEVELOPMENTS / DEVELOPABLE LAND 75,473 44,432 16,689
-------- ---------- --------
$405,911 $1,764,370 $412,255
======== ========== ========
<Caption>
GROSS AMOUNT CARRIED
AT CLOSE OF PERIOD 12/31/02
--------------------------------------- ACCUMULATED
BUILDING AND DEPRECIATION YEAR BUILT/ DEPRECIABLE
BUILDING ADDRESS LAND IMPROVEMENTS TOTAL 12/31/02 RENOVATED LIVES (YEARS)
- ---------------- -------- ------------ ---------- ------------ ----------- -------------
5709 Johns Road 200 1,219 1,419 158 1990 (p)
5711 Johns Road 255 1,544 1,799 243 1990 (p)
5453 W Waters Avenue 82 490 572 63 1987 (p)
5455 W Waters Avenue 326 1,902 2,227 262 1987 (p)
5553 W Waters Avenue 326 1,925 2,251 265 1987 (p)
5501 W Waters Avenue 162 943 1,105 125 1990 (p)
5503 W Waters Avenue 75 450 525 64 1990 (p)
5555 W Waters Avenue 221 1,303 1,524 166 1990 (p)
5557 W Waters Avenue 62 364 427 48 1990 (p)
5463 W Waters Avenue 560 3,144 3,704 392 1996 (p)
5903 Johns Road 93 566 659 81 1987 (p)
5461 W Waters 265 1,181 1,447 115 1998 (p)
5471 W. Waters 574 969 1,543 53 1999 (p)
5505 Johns Road #7 228 1,395 1,624 147 1999 (p)
5481 W. Waters Avenue 561 2,295 2,856 178 1999 (p)
5483 W. Waters Avenue 459 1,938 2,397 169 1999 (p)
6702-6712 Benjamin Road(m) 650 3,931 4,581 385 1982/84 (p)
5905 Breckenridge Parkway 191 1,103 1,294 57 1982 (p)
5907 Breckenridge Parkway 61 355 416 18 1982 (p)
5909 Breckenridge Parkway 174 1,015 1,189 54 1982 (p)
5911 Breckenridge Parkway 311 1,776 2,087 92 1982 (p)
5910 Breckenridge Parkway 440 2,505 2,945 130 1982 (p)
5912 Breckenridge Parkway 464 2,641 3,105 137 1982 (p)
4515-4519 George Road 640 3,666 4,306 147 1985 (p)
6301 Benjamin Road 295 1,754 2,049 70 1986 (p)
5723 Benjamin Road 409 2,340 2,749 87 1986 (p)
6313 Benjamin Road 231 1,320 1,551 49 1986 (p)
5801 Benjamin Road 569 3,244 3,812 121 1986 (p)
5802 Benjamin Road 692 4,086 4,778 152 1986 (p)
5925 Benjamin Road 331 1,886 2,216 71 1986 (p)
OTHER
2800 Airport Road(l) 490 3,386 3,876 1,670 1968 (p)
3501 Maple Street 260 1,864 2,124 884 1980 (p)
4200 West Harry Street(j) 528 3,640 4,168 1,785 1972 (p)
Industrial Park No. 2 776 5,330 6,106 2,614 1968 (p)
6601 S. 33rd Street 233 1,306 1,539 114 1975 (p)
9601A Dessau Road 366 1,750 2,115 139 1999 (p)
9601B Dessau Road 355 1,945 2,300 263 1999 (p)
9601C Dessau Road 355 2,584 2,939 823 1999 (p)
555 Vista Blvd 1,711 9,695 11,406 142 1980 (p)
REDEVELOPMENTS / DEVELOPABLE LAND 75,560 61,035 136,595 5,796 (q)
-------- ---------- ---------- --------
$416,980 $2,165,556 $2,582,536(r) $310,517
======== ========== ========== ========
</Table>
S-13
NOTES:
(a) See description of encumbrances in Note 5 to Notes to Consolidated
Financial Statements.
(b) Initial cost for each respective property is total purchase price
associated with its purchase.
(c) These properties collateralized the 1995 Mortgage Loan. The loan was paid
off and retired on January 13, 2003 which released the mortgage lien on
these properties.
(d) These properties collateralize the Assumed Loans.
(e) This property collateralizes the Acquisition Mortgage Loan VIII.
(f) This property collateralizes the Acquisition Mortgage Loan IX.
(g) This property collateralizes the Acquisition Mortgage Loan IV.
(h) This property collateralizes the Acquisition Mortgage Loan V.
(i) Comprised of two properties.
(j) Comprised of three properties.
(k) Comprised of four properties.
(l) Comprised of five properties.
(m) Comprised of six properties.
(n) Comprised of seven properties.
(o) Comprised of 29 properties.
(p) Depreciation is computed based upon the following estimated lives:
Buildings, Improvements 31.5 to 40 years
Tenant Improvements, Leasehold Improvements Life of lease
Furniture, Fixtures and Equipment 5 to 10 years
(q) These properties represent developable land and redevelopments that have
not been placed in service.
(r) Excludes $122,331 of Construction in Progress and $1,258 of Furniture,
Fixtures and Equipment.
(s) During 2001, the Company recognized a valuation provision of $9,500 on
these properties.
At December 31, 2002, the aggregate cost of land and buildings and
equipment for federal income tax purpose was approximately $2.3 billion
(excluding construction in progress.)
S-14
FIRST INDUSTRIAL REALTY TRUST, INC.
SCHEDULE III:
REAL ESTATE AND ACCUMULATED DEPRECIATION (continued)
AS OF DECEMBER 31, 2002
(DOLLARS IN THOUSANDS)
The changes in total real estate assets for the three years ended December 31,
2002 are as follows:
<Table>
<Caption>
2002 2001 2000
---------- ---------- ----------
Balance, Beginning of Year ......................... $2,748,835 $2,698,763 $2,597,592
Acquisition, Construction Costs and Improvements ... 357,704 397,878 504,135
Disposition of Assets .............................. (400,414) (338,306) (400,064)
Valuation Provision ................................ -- (9,500) (2,900)
---------- ---------- ----------
Balance, End of Year ............................... $2,706,125 $2,748,835 $2,698,763
========== ========== ==========
</Table>
The changes in accumulated depreciation for the three years ended December 31,
2002 are as follows:
<Table>
<Caption>
2002 2001 2000
---------- ---------- ----------
Balance, Beginning of Year ......................... $ 280,518 $ 244,189 $ 211,456
Depreciation for Year .............................. 67,525 65,944 59,840
Disposition of Assets .............................. (37,526) (29,615) (27,107)
---------- ---------- ----------
Balance, End of Year ............................... $ 310,517 $ 280,518 $ 244,189
========== ========== ==========
</Table>
S-15