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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

 

FORM 10-K

 

(Mark One)

 

 

ý

 

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

 

 

 

o

 

Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934

 

 

 

 

 

For the transition period from                       to                         

 

 

 

Commission file number   0-20625

 

DUKE REALTY LIMITED PARTNERSHIP

 

State of Incorporation:

 

IRS Employer ID Number:

Indiana

 

35-1898425

 

 

 

600 East 96th Street, Suite 100
Indianapolis, Indiana 46240

 

 

 

Telephone:   (317)  808-6000

 

 

 

Securities registered pursuant to Section 12(b) of the Act:  None

 

 

 

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    ý     No    o

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 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.   ý

 

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Securities Exchange Act).  Yes  o No  ý

 

The aggregate market value of the Limited Partner Units held by non-affiliates of Registrant is $321.5 million based on the last reported sale price of the common shares of Duke Realty Corporation into which Limited Partner Units are exchangeable, on February 18, 2003.

 

The number of Limited Partnership Units outstanding as of February 18, 2003, was 149,963,048.

 

 



 

TABLE OF CONTENTS

 

Form 10-K

 

 

 

 

 

 

 

PART I

 

 

 

 

 

1.

Business

 

2.

Properties

 

3.

Legal Proceedings

 

4.

Submission of Matters to a Vote of Security Holders

 

 

Executive Officers of the General Partner

 

 

 

PART II

 

 

 

 

 

 

 

5.

Market for the Registrant’s Common Equity and Related Stockholder Matters

 

6.

Selected Consolidated Financial Data

 

7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

7A.

Quantitative and Qualitative Disclosures about Market Risk

 

8.

Financial Statements and Supplementary Data

 

9.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 

 

 

PART III

 

 

 

 

 

10.

Directors and Executive Officers of the Registrant

 

11.

Executive Compensation

 

12.

Security Ownership of Certain Beneficial Owners and Management and Related Unitholders Matters

 

13.

Certain Relationships and Related Transactions

 

14.

Disclosure Controls and Procedures

 

 

 

PART IV

 

 

 

 

 

15

Exhibits, Financial Statement Schedules and Reports on Form 8-K

 

 

 

Signatures

 



 

PART I

 

Item 1.  Business

 

Risk Factors

 

There are certain risk factors associated with an investment of securities issued by Duke Realty Corporation (the “General Partner”) and Duke Realty Limited Partnership (the “Partnership”). Discussion of these risk factors can be found in the General Partner’s Report on Form 8K filed with the Securities and Exchange Commission (“SEC”) on December 6, 2001.

 

Background

 

The Partnership was formed on October 4, 1993, when Duke Realty Corporation (the “Predecessor” or the “General Partner”) contributed all of its properties and related assets and liabilities, along with the net proceeds of $309.3 million from the issuance of an additional 14,000,833 shares of the General Partner through an offering, to the Partnership. Simultaneously, the Partnership completed the acquisition of Duke Associates, a full-service commercial real estate firm operating in the Midwest. The General Partner was formed in 1985 and qualifies as a Real Estate Investment Trust (“REIT”) under provisions of the Internal Revenue Code. The General Partner is the sole general partner of the Partnership, owning 90.1% of the partnership interest as of December 31, 2002 (“General Partner Units”). The remaining 9.9% of the Partnership is owned by limited partners (“Limited Partner Units” and, together with the General Partner Units, the “Common Units”). As of December 31, 2002, the Partnership’s diversified portfolio of 927 rental properties (including 17 properties totaling 3.1 million square feet under development) encompass over 108 million rentable square feet and are leased by a diverse and stable base of approximately 4,500 tenants whose businesses include manufacturing, retailing, wholesale trade, distribution and professional services. The Partnership also owns or controls more than 3,800 acres of unencumbered land ready for development.

 

The Partnership, through its Service Operations, also provides, on a fee basis, leasing, property and asset management, development, construction, build-to-suit, and other tenant-related services for approximately 400 tenants in over 8 million square feet of space at properties owned by third-party clients. With 13 primary operating platforms, the Partnership concentrates its activities in the Midwest and Southeast United States. See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Item 8, “Financial Statements and Supplementary Data” for financial information. The Partnership conducts its Service Operations through Duke Realty Services Limited Partnership (“DRSLP”) and Duke Construction Limited Partnership (“DCLP”). All references to the “Partnership” in this Annual Report Form 10-K include the Partnership and those entities owned or controlled by the Partnership, unless the context indicates otherwise.

 

The Partnership’s headquarters and executive offices are located in Indianapolis, Indiana. In addition, the Partnership has twelve regional offices located in Atlanta, Georgia; Cincinnati, Ohio; Columbus, Ohio; Cleveland, Ohio; Chicago, Illinois; Dallas, Texas; Minneapolis, Minnesota; Nashville, Tennessee; Orlando, Florida; Raleigh, North Carolina; St. Louis, Missouri and Tampa, Florida. The Partnership had 1,001 employees as of December 31, 2002.

 

Business Strategy

 

The Partnership’s business objective is to increase its Funds From Operations (“FFO”) by (i) maintaining and increasing property occupancy and rental rates through the aggressive management of its portfolio of existing properties; (ii) expanding existing properties; (iii) developing and acquiring new properties; and (iv) providing a full line of real estate services to the Partnership’s tenants and to third-parties. FFO is defined by the National Association of Real Estate Investment Trusts as net income or loss, excluding gains or losses from sales of depreciated operating property, plus operating property depreciation and amortization and adjustments for minority interest and unconsolidated companies on the same basis. While management believes that FFO

 

1



 

is a relevant measure of the Partnership’s operating performance because it is widely used by industry analysts to measure the operating performance of equity REITs, such amount does not represent cash flow from operations as defined by generally accepted accounting principles, should not be considered as an alternative to net income as an indicator of the Partnership’s operating performance, and is not indicative of cash available to fund all cash flow needs. As a fully integrated commercial real estate firm, the Partnership believes that its in-house leasing, management, development and construction services and the Partnership’s significant base of commercially zoned and unencumbered land in existing business parks should give the Partnership a competitive advantage in its future development activities.

 

The Partnership believes that the analysis of real estate opportunities and risks can be done most effectively at regional or local levels. As a result, the Partnership intends to continue its emphasis on increasing its market share and effective rents in its primary markets where it owns properties. The Partnership also expects to utilize its more than 3,800 acres of unencumbered land and its many business relationships with nearly 4,500 commercial tenants to expand its build-to-suit business (development projects substantially pre-leased to a single tenant) and to pursue other development and acquisition opportunities in its primary markets. The Partnership believes that this regional focus will allow it to assess market supply and demand for real estate more effectively as well as to capitalize on its strong relationships with its tenant base.

 

The Partnership’s policy is to seek to develop and acquire Class A commercial properties located in markets with high growth potential for Fortune 500 companies and other quality regional and local firms. The Partnership’s industrial and suburban office development focuses on business parks and mixed-use developments suitable for multiple projects on a single site where the Partnership can create and control the business environment. These business parks and mixed-use developments generally include restaurants and other amenities which the Partnership believes will create an atmosphere that is particularly efficient and desirable. The Partnership’s retail development focuses on community, power and neighborhood centers in its existing markets. As a fully integrated real estate company, the Partnership is able to arrange for or provide to its industrial, office and retail tenants not only well located and well maintained facilities, but also additional services such as build-to-suit construction, tenant finish construction, expansion flexibility and advertising and marketing services.

 

All of the Partnership’s properties are located in areas that include competitive properties. Such properties are generally owned by institutional investors, other REITs or local real estate operators; however, no single competitor or small group of competitors is dominant in the Partnership’s current markets. The supply and demand of similar available rental properties may affect the rental rates the Partnership will receive on its properties.

 

Financing Strategy

 

The Partnership seeks to maintain a well-balanced, conservative and flexible capital structure by: (i) extending and sequencing the maturity dates of its debt; (ii) borrowing primarily at fixed rates; (iii) generally pursuing current and future long-term debt financings and refinancings on an unsecured basis; and (iv) maintaining conservative debt service and fixed charge coverage ratios. Management believes that these strategies have enabled and should continue to enable the General Partner and the Partnership to access capital markets for their long-term requirements such as debt refinancings and financing development and acquisitions of additional rental properties. In addition, as discussed under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the Partnership has a $500 million unsecured line of credit and a $50 million secured line of credit available for short-term fundings of development and acquisition of additional rental properties. In addition, the Partnership pursues favorable opportunities to dispose of assets that no longer meet the Partnership’s long-term investment criteria and re-deploy the proceeds into new investments that the Partnership believes have excellent long-term growth prospects. See additional discussion under Item 7,

 

2



 

“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The Partnership’s debt to total market capitalization ratio (total market capitalization is defined as the total market value of all outstanding Common Units and Preferred equity plus outstanding indebtedness) at December 31, 2002 was 32.7%. The Partnership’s ratio of earnings to debt service and ratio of earnings to fixed charges for the year ended December 31, 2002, were 2.40x and 1.88x, respectively. In computing the ratio of earnings to debt service, earnings have been calculated by adding debt service to income from continuing operations before earnings or losses from the sale of land and depreciable property dispositions, net of impairment adjustments. Debt service consists of interest expense and recurring principal amortization (excluding maturities) and excludes amortization of debt issuance costs. In computing the ratio of earnings to fixed charges, earnings have been calculated by adding fixed charges, excluding capitalized interest, to income from continuing operations before earnings or losses from the sale of land and depreciable property dispositions, net of impairment adjustments. Fixed charges consist of interest costs, whether expensed or capitalized, the interest component of rental expense, amortization of debt issuance costs and preferred equity dividend requirements.

 

Other

 

The Partnership’s operations are not dependent on a single or few customers as no single customer accounts for more than 1.6% of the Partnership’s total revenue. The Partnership’s operations are not subject to any significant seasonal fluctuations. The Partnership believes it is in compliance with environmental regulations and does not anticipate material effects of continued compliance.

 

For additional information regarding the Partnership’s investments and operations, see Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and Item 8, “Financial Statements and Supplementary Data.” For additional information about the Partnership’s business segments, see Item 8, “Financial Statements and Supplementary Data.”

 

In addition to this Annual Report, the General Partner and the Partnership file quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any document that is filed at the public reference facilities of the SEC at 450 Fifth Street, N.W., Washington, D.C. 25049.  Please call the SEC at (800) SEC-0330 for further information about the public reference facilities. These documents also may be accessed through the SEC’s electronic data gathering, analysis and retrieval system (“EDGAR”) via electronic means, including the SEC’s home page on the Internet (http://www.sec.gov). In addition, since some of our securities are listed on the New York Stock Exchange, you can read SEC filings at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005.

 

Item 2.  Properties

 

Product Review

 

As of December 31, 2002, the Partnership owns an interest in a diversified portfolio of 927 commercial properties encompassing over 108 million net rentable square feet (including  17 properties comprising 3.1 million square feet under development) and more than 3,800 acres of land for future development.

 

Industrial Properties: The Partnership owns interests in 668 industrial properties encompassing approximately 81.7 million square feet (75% of total square feet) more specifically described as follows:

                             Bulk Warehouses – Industrial warehouse/distribution buildings with clear ceiling heights of 20 feet or more. The Partnership owns 439 buildings totaling 67.9 million square feet of such properties.

                             Service Centers – Also known as flex buildings or light industrial, this product type has 12-18 foot clear ceiling heights and a combination of drive-up and dock-height loading access. The Partnership owns 229 buildings totaling 13.8 million square feet of such properties.

 

 

3



Office Properties:  The Partnership owns interests in 246 office buildings totaling approximately 25.6 million square feet (24% of total square feet) more specifically described as follows:

 

                       Suburban Office – The Partnership owns 242 suburban office buildings totaling 24.7 million square feet.

                       CBD Office – The Partnership owns four downtown office projects totaling approximately 861,000 square feet.

 

Retail Properties:  The Partnership owns interests in 13 retail projects totaling approximately 1.0 million square feet (1% of total square feet). These properties encompass both power and neighborhood shopping centers.

 

Land:  The Partnership owns or controls more than 3,800 acres of land located primarily in its existing business parks. The land is ready for immediate use and is unencumbered by debt. Over 59 million square feet of additional space can be developed on these sites and all of the land is zoned for either office, industrial or retail development.

 

Service Operations:  The Partnership provides property and asset management, development, leasing and construction services to third party owners in addition to its own properties. The Partnership’s current property management base for third parties includes over 8.0 million square feet of properties serving approximately 400 tenants.

 

Property Descriptions

 

The following schedule represents the geographic highlights of the Partnership’s in-service properties in its primary markets as of December 31, 2002:

 

 

 

 

Square Feet(1)

 

 

 

Percent of
Annual Net

Effective
Rent

 

 

 

 

 

 

 

 

 

 

 

Retail

 

Overall

 

Percent of Overall

 

Annual Net
Effective Rent(2)

 

 

Industrial

Office

Service Center

 

Bulk

Suburban

 

CBD

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Primary Market

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Atlanta

 

3,300,785

 

9,137,762

 

1,996,336

 

 

19,115

 

14,453,998

 

13.74

%

78,288,523

 

13.78

%

Cincinnati

 

1,240,393

 

8,398,090

 

3,226,604

 

699,402

 

718,165

 

14,282,654

 

13.58

%

74,008,465

 

13.01

%

Indianapolis

 

1,608,384

 

16,602,443

 

2,433,524

 

161,984

 

102,090

 

20,908,425

 

19.88

%

66,060,906

 

11.62

%

St. Louis

 

1,368,761

 

2,890,585

 

3,313,179

 

 

 

7,572,525

 

7.20

%

65,449,116

 

11.51

%

Columbus

 

82,520

 

4,731,652

 

3,102,150

 

 

 

7,916,322

 

7.53

%

48,772,149

 

8.58

%

Minneapolis

 

2,553,377

 

4,245,231

 

1,156,912

 

 

 

7,955,520

 

7.56

%

48,022,224

 

8.44

%

Cleveland

 

60,600

 

3,359,967

 

2,018,449

 

 

 

5,439,016

 

5.17

%

40,916,417

 

7.20

%

Nashville

 

1,285,437

 

3,335,961

 

787,496

 

 

 

5,408,894

 

5.14

%

38,316,926

 

6.74

%

Raleigh

 

1,159,838

 

1,487,910

 

2,098,549

 

 

 

4,746,297

 

4.51

%

37,311,823

 

6.56

%

Chicago

 

276,344

 

3,352,629

 

1,619,021

 

 

 

5,247,994

 

4.99

%

28,790,456

 

5.06

%

Central Florida

 

350,493

 

2,096,277

 

1,136,439

 

 

 

3,583,209

 

3.41

%

22,105,509

 

3.89

%

Dallas

 

470,754

 

5,407,053

 

152,000

 

 

 

6,029,807

 

5.73

%

13,849,405

 

2.44

%

South Florida

 

 

539,336

 

675,581

 

 

 

1,214,917

 

1.15

%

6,207,622

 

1.09

%

Other(3)

 

 

436,139

 

 

 

 

436,139

 

0.41

%

557,914

 

0.10

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

13,757,686

 

66,021,035

 

23,716,240

 

861,386

 

839,370

 

105,195,717

 

100.00

%

$

568,657,457

 

100.00

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13.08

%

62.77

%

22.54

%

0.82

%

0.80

%

100.00

%

 

 

 

 

 

 

 

 

 

Occupancy %

 

 

 

Industrial

 

Office

 

 

 

 

 

 

 

Service Center

 

Bulk

 

Suburban

 

CBD

 

Retail

 

Overall

 

Primary   Market

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Atlanta

 

89.18

%

80.06

%

87.05

%

 

100.00

%

83.13

%

Cincinnati

 

82.84

%

91.85

%

89.80

%

91.51

%

99.40

%

90.97

%

Indianapolis

 

93.94

%

89.45

%

85.86

%

95.34

%

91.62

%

89.43

%

St.Louis

 

82.91

%

86.32

%

94.05

%

 

 

89.09

%

Columbus

 

100.00

%

81.79

%

92.29

%

 

 

86.09

%

Minneapolis

 

87.75

%

87.64

%

87.03

%

 

 

87.59

%

Cleveland

 

100.00

%

86.49

%

87.26

%

 

 

86.93

%

Nashville

 

83.90

%

90.43

%

81.34

%

 

 

87.55

%

Raleigh

 

89.37

%

72.96

%

74.44

%

 

 

77.63

%

Chicago

 

68.03

%

81.36

%

81.15

%

 

 

80.59

%

Central Florida

 

86.15

%

76.97

%

77.09

%

 

 

77.91

%

Dallas

 

89.61

%

95.82

%

100.00

%

 

 

95.44

%

South Florida

 

 

100.00

%

65.17

%

 

 

80.63

%

Other(3)

 

 

100.00

%

 

 

 

100.00

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

87.42

%

87.05

%

86.26

%

92.23

 

98.46

 

87.05

%

 


(1)          Includes all wholly owned and joint venture projects shown at 100% as of report date.

 

(2)          Represents the average annual rental property revenue due from tenants in occupancy as of the date of this report, excluding additional rent due as operating expense reimbursements, landlord allowances for operating expenses and percentage rents.  Joint Venture properties are shown at the Company’s ownership percentage.

 

(3)          Represents properties not located in the Company’s primary markets.  These properties are located in similar midwest or southeast markets.

 

4



 

Item 3.  Legal Proceedings

 

The General Partner and the Partnership are subject to various legal proceedings and claims that arise in the ordinary course of business.  In the opinion of management, the amount of any ultimate liability with respect to these actions will not materially affect the Partnership’s consolidated financial statements or results of operations.

 

Item 4.  Submission of Matters to a Vote of Security Holders

 

No matters were submitted to a vote of security holders of the Partnership during the fourth quarter of the year ended December 31, 2002.

 

Executive Officers of the General Partner

 

Gary A. Burk, age 51.  Mr. Burk has served as Vice Chairman and Executive Vice President of Construction of the General Partner since January 2003.  Mr. Burk served as Co-Chief Operating Officer of the General Partner from March 2002 until January 2003.  Prior to that time and since 1993, Mr. Burk served as the General Partner’s Executive Vice President, Construction.

 

Robert M. Chapman, age 49.  Mr. Chapman has served as the General Partner’s Executive Vice President, Southern Region, since 2000. He is responsible for the Partnership’s Atlanta, Orlando, Tampa, Raleigh, Nashville and Dallas property portfolios.  Mr. Chapman was previously the General Partner’s Executive Vice President of the Atlanta/Texas region from 1999 to 2000, and its Executive Vice President of Acquisitions and Dispositions from 1997 to 1999. Before joining the General Partner in 1997, he served as Senior Vice President and Portfolio Manager for The RREEF Funds. Prior to that, Gerald Hines Interests and Lincoln Property employed Mr. Chapman.

 

Howard L. Feinsand, age 55.  Mr. Feinsand has served as the General Partner’s Executive Vice President, and General Counsel since 1999. Mr. Feinsand served on the General Partner’s Board of Directors from  1988 to January 2003. From 1996 until 1999, Mr. Feinsand was the founder and principal of Choir Capital Ltd. From 1995 until 1996, he was Managing Director of Citicorp North America, Inc.  He was the Senior Vice President and Manager-Capital Markets, Pricing and Investor Programs of GE Capital Aviation Services, Inc., an aircraft leasing company, from 1989 to 1995.

 

Thomas L. Hefner, age 56.  Mr. Hefner has served as Chairman of the Board since 1998 and Chief Executive Officer of the General Partner since 1993. Mr. Hefner has served as a Director of the General Partner since 1993 and also serves as a member of the board of directors of the National Association of Real Estate Investment Trusts, the Central Indiana Corporate Partnership and the Nature Conservancy of Indiana. In addition, he serves on the Dean’s Advisory Council of Purdue University’s Krannert School of Business.

 

William E. Linville, III, age 48.  Mr. Linville has been Executive Vice President, Midwest Region, for the General Partner since March 2001. In this role, he has responsibility for the Partnership’s Indiana, Chicago, Minneapolis and St. Louis operations.  From 1994 until March 2001, Mr. Linville led the Partnership’s Midwest Industrial Group. He originally joined the Partnership in 1987 as head of its Indiana Industrial Group.

 

Dennis D. Oklak, age 49.  Mr. Oklak has served as the President and Chief Operating Officer of the General Partner since January 2003. Prior to that, Mr. Oklak served as Co-Chief Operating Officer and Executive Vice President of the General Partner. He was also the Chief Administrative Officer of the General Partner since 1997. From 1993 to 1997, he served as the General Partner’s Vice-President and Treasurer.

 

5



 

Darell E. Zink, Jr., age 56.  Mr. Zink has served as the General Partner’s Vice Chairman, Executive Vice President and Chief Financial Officer since January 2003.  Prior to that time he served as the General Partner’s Executive Vice President and Chief Financial Officer since 1993.  He has been with the Partnership since 1982 and has served as a Director since 1993.  Mr. Zink also serves as a member of the board of directors of Citizens Gas & Coke Utility, Fifth Third Bank of Indiana, the CICOA Foundation, the Indianapolis Chamber of Commerce, VEI/IMM (a subsidiary of Community Hospitals), Vanderbilt University Alumni Board and Educational Choice.  He also serves as chairman of the Inroads Advisory Board.

 

PART II

 

Item 5.  Market for the Registrant’s Common Equity and Related Stockholder Matters

 

There is no established public trading market for the Common Units. The following table sets forth the cash distributions paid during each quarter. As of February 18, 2003, there were 181 record holders of Common Units.

 

Quarter Ended

 

2002 Distributions
per Common Unit

 

2001 Distributions
per Common Unit

 

 

 

 

 

 

 

December 31

 

$

.455

 

$

.45

 

September 30

 

.455

 

.45

 

June 30

 

.450

 

.43

 

March 31

 

.450

 

.43

 

 

On January 29, 2003, the Partnership declared a quarterly cash distribution of $0.455 per Common Unit payable on February 28, 2003, to Common Unitholders of record on February 14, 2003.

 

Item 6.  Selected Consolidated Financial Data

 

The following sets forth selected consolidated financial and operating information on a historical basis for the Partnership for each of the years in the five-year period ended December 31, 2002. The following information should be read in conjunction with Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Item 8, “Financial Statements and Supplementary Data” included in this Form 10-K (in thousands, except per unit amounts):

 

 

 

2002

 

2001

 

2000

 

1999

 

1998

 

Results of Operations:

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

Rental Operations

 

$

711,526

 

$

714,739

 

$

706,747

 

$

534,555

 

$

347,847

 

Service Operations

 

67,620

 

80,459

 

82,799

 

54,031

 

24,716

 

Total Revenues from Continuing Operations

 

$

779,146

 

$

795,198

 

$

789,546

 

$

588,586

 

$

372,563

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income Available for Common Unitholders

 

$

179,746

 

$

262,430

 

$

245,029

 

$

159,447

 

$

103,112

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Unit Data :

 

 

 

 

 

 

 

 

 

 

 

Basic Income per Common Unit:

 

 

 

 

 

 

 

 

 

 

 

Continuing Operations

 

$

1.16

 

$

1.75

 

$

1.67

 

$

1.33

 

$

1.13

 

Discontinued Operations

 

.04

 

.02

 

.01

 

 

 

 

Diluted Income per Common Unit:

 

 

 

 

 

 

 

 

 

 

 

Continuing Operations

 

1.15

 

1.73

 

1.65

 

1.32

 

1.12

 

Discontinued Operations

 

.04

 

.02

 

.01

 

 

 

Dividends paid per Common Unit

 

1.81

 

1.76

 

1.64

 

1.46

 

1.28

 

Weighted Average Common Units Outstanding

 

149,423

 

147,961

 

145,906

 

119,467

 

91,576

 

Weighted Average Common and Dilutive Potential Common Units

 

150,839

 

151,710

 

147,441

 

120,511

 

92,468

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheet Data (at December 31):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Assets

 

$

5,347,055

 

$

5,330,246

 

$

5,461,233

 

$

5,487,284

 

$

2,854,062

 

Total Debt

 

2,106,285

 

1,814,856

 

1,973,215

 

2,113,476

 

1,007,317

 

Total Preferred Equity

 

415,466

 

583,419

 

689,216

 

690,340

 

348,366

 

Total Partners’ Equity

 

2,919,843

 

3,176,232

 

3,147,598

 

3,101,989

 

1,677,988

 

Total Common Units Outstanding

 

149,907

 

148,438

 

146,911

 

144,803

 

96,853

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Data:

 

 

 

 

 

 

 

 

 

 

 

Funds From Operations(1)

 

$

376,454

 

$

395,693

 

$

365,129

 

$

267,243

 

$

174,829

 

Cash Flow Provided by (Used by):

 

 

 

 

 

 

 

 

 

 

 

Operating activities

 

$

568,973

 

$

348,680

 

$

363,610

 

$

316,286

 

$

220,529

 

Investing activities

 

(337,247

)

93,488

 

(11,972

)

(740,847

)

(703,575

)

Financing activities

 

(225,050

)

(470,915

)

(330,952

)

436,449

 

479,300

 

 


(1)          Funds From Operations is defined by the National Association of Real Estate Investment Trusts as net income or loss, excluding gains or losses from sales of depreciated property, plus operating property depreciation and amortization and adjustments for minority interest and unconsolidated companies on the same basis. Funds From Operations does not represent cash flow from operations as defined by generally accepted accounting principles, should not be considered as an alternative to net income as an indicator of the Partnership’s operating performance, and is not indicative of cash available to fund all cash flow needs.

 

6



 

Item 7.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

Cautionary Statement Regarding Forward Looking Statements

 

Certain statements in this Annual Report, including those related to the Partnership’s future operations, constitute “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. These forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the Partnership, or industry results, to differ materially from any predictions of future results, performance or achievements that we express or imply in this report. Some of the risks, uncertainties and other important factors that may affect future results include, among others:

 

    General economic and business conditions;

    The General Partner’s continued qualification as a real estate investment trust;

    Competition for tenants and a decrease in property occupancy;

    Potential increases in real estate construction costs;

    Potential changes in interest rates;

    Continuing ability to favorably raise debt and equity in the capital markets; and

    Other risks inherent in the real estate business including tenant defaults, potential liability relating to environmental matters and liquidity of real estate investments.

 

This list of risks and uncertainties, however, is not intended to be exhaustive. The General Partner has on file with the SEC a Report on Form 8K dated December 6, 2001, with additional risk factor information.

 

The words “believe,” “estimate,” “expect” and similar expressions or statements regarding future periods are intended to identify forward-looking statements. Although we believe that the plans, expectations and results expressed in or suggested by our forward-looking statements are reasonable, all forward-looking statements are inherently uncertain as they involve substantial risks and uncertainties beyond the Partnership’s control. New factors emerge from time to time, and it is not possible for us to predict the nature or assess the potential impact of each new factor on the Partnership’s business. Given these uncertainties, we caution you not to place undue reliance on these forward-looking statements. The Partnership undertakes no obligation to update or revise any of its forward-looking statements for events or circumstances that arise after the statement is made.

 

Business Overview

 

As of December 31, 2002, the Partnership:

 

                 Owned or controlled 927 industrial, office and retail properties (including properties under development), consisting of over 108 million square feet located in 12 states; and

                 Owned or controlled approximately 3,800 acres of land with an estimated future development potential of approximately 59 million square feet of industrial, office and retail properties.

 

7



 

The Partnership provides the following services for its properties and for certain properties owned by third parties:

 

                 leasing;

                 management;

                 construction;

                 development; and

                 other tenant-related services.

 

The Partnership’s operating results depend primarily upon income from the Rental Operations of its properties. This rental income is substantially influenced by the supply and demand for the Partnership’s rental space. The Partnership’s continued growth is dependent upon its ability to maintain occupancy rates and increase rental rates of its in-service portfolio. The Partnership’s strategy for growth also includes developing and acquiring additional rental properties.

 

Rental Operations revenues decreased from $714.7 million in 2001 to $711.5 million in 2002, as the effects of a weakened economy lingered in the Partnership’s markets for 2001 and 2002. The occupancy level of the Partnership’s in-service portfolio decreased from 88.6% at December 31, 2001, to 87.1% at December 31, 2002 due to the following factors:

 

    The low occupancy levels of new developments placed in-service over the last twelve to eighteen months as a result of slow lease-up activity;

    The slowdown in demand in many of the Partnership’s markets from the weakened economy; and

    The effects of the Partnership’s disposition activities in 2000 and 2001 during which the Partnership sold over $1 billion of assets in an effort to de-leverage the Partnership’s balance sheet and dispose of unwanted properties

 

While these events have affected growth and related rental income, the Partnership believes that is has strong liquidity and financial flexibility (See additional discussion under Liquidity and Capital Resources). With a debt to market capitalization ratio of 32.7% and $219 million available on its unsecured line of credit as of December 31, 2002, the Partnership believes that it is positioned to fund its operational expenses and shareholder distributions and to make future opportunistic real estate investments.

 

The following highlights the areas of Rental Operations that the Partnership considers critical for future revenue growth (all square footage totals and occupancy percentages reflect 100% of both wholly-owned properties and properties in joint ventures):

 

Same Property Performance: The Partnership tracks same property performance, which measures the performance of properties that were in-service for all reported portions of a two-year period by comparing the results of the second year with the results of the first year. In 2002, net operating income from the same property portfolio increased just .3% over 2001, compared to 4.4% growth in 2001 over 2000. The lower growth in same property performance resulted from lower occupancies in the properties that rolled into the same property population in 2002, coupled with the fact that a majority of the properties sold over the past two years were from the same property population and were over 90% leased. The lower occupancy on our same property population was slightly offset by an increase in net effective rents; however, rental rate growth has decreased significantly from 2000 and 2001.

 

Occupancy Analysis: As discussed above, the ability to maintain occupancy rates is a principal driver of the Partnership’s results of operations. The following table sets forth information regarding the Partnership’s in-service portfolio of rental properties as of December 31, 2002 and 2001 (square feet in thousands):

 

8



 

 

 

Total
Square Feet

 

Percent of
Total Square Feet

 

Percent Occupied

 

Type

 

2002

 

2001

 

2002

 

2001

 

2002

 

2001

 

Industrial

 

 

 

 

 

 

 

 

 

 

 

 

 

Service Centers

 

13,758

 

13,833

 

13.0

%

13.4

%

87.4

%

88.7

%

Bulk

 

66,021

 

64,786

 

62.8

%

63.0

%

87.1

%

89.4

%

Office

 

24,578

 

23,528

 

23.4

%

22.9

%

86.5

%

86.0

%

Retail

 

839

 

745

 

0.8

%

0.7

%

98.5

%

96.8

%

Total

 

105,196

 

102,892

 

100.0

%

100.0

%

87.1

%

88.6

%

 

The Partnership’s lower occupancy percentage in 2002 as compared to 2001 was primarily caused by slower lease-up of new developments placed in-service during 2002 and 2001 and reduced demand for existing space. While the decline in occupancy appears to be slowing, and the Partnership is focused on leasing existing space, management cannot predict when the occupancy of these properties will increase.

 

Lease Expiration: The Partnership’s ability to maintain and grow its occupancy rates primarily depends upon its continuing ability to re-lease expiring space. The following table reflects the Partnership’s in-service lease expiration schedule as of December 31, 2002, by product type. The table indicates square footage and annualized net effective rents (based on December 2002 rental revenue) under expiring leases (in thousands):

 

 

 

Total Portfolio

 

Industrial

 

Office

 

Retail

 

Year of Expiration

 

Square
Feet

 

Dollars

 

%

 

Square
Feet

 

Dollars

 

Square
Feet

 

Dollars

 

Square
Feet

 

Dollars

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2003

 

10,194

 

$

64,266

 

10

%

8,200

 

$

40,074

 

1,994

 

$

24,192

 

 

$

 

2004

 

10,963

 

77,778

 

12

%

8,248

 

39,784

 

2,692

 

37,587

 

23

 

407

 

2005

 

13,727

 

96,060

 

15

%

10,828

 

54,391

 

2,861

 

41,165

 

38

 

504

 

2006

 

11,045

 

76,865

 

12

%

8,725

 

45,491

 

2,315

 

31,296

 

5

 

78

 

2007

 

10,771

 

75,862

 

12

%

8,199

 

41,209

 

2,514

 

33,934

 

58

 

719

 

2008

 

8,491

 

52,229

 

8

%

6,912

 

30,958

 

1,555

 

20,901

 

24

 

370

 

2009

 

7,135

 

43,927

 

7

%

5,776

 

25,112

 

1,340

 

18,446

 

19

 

369

 

2010

 

6,312

 

49,314

 

8

%

4,511

 

21,403

 

1,785

 

27,647

 

16

 

264

 

2011

 

3,600

 

31,389

 

5

%

2,325

 

11,193

 

1,259

 

19,951

 

16

 

245

 

2012

 

4,303

 

26,920

 

4

%

3,267

 

12,526

 

1,018

 

13,896

 

18

 

498

 

2013 and Thereafter

 

5,037

 

46,849

 

7

%

2,508

 

12,310

 

1,920

 

29,788

 

609

 

4,751

 

 

 

91,578

 

$

641,459

 

100

%

69,499

 

$

334,451

 

21,253

 

$

298,803

 

826

 

$

8,205

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Portfolio Square Feet

 

105,196

 

 

 

 

 

79,779

 

 

 

24,578

 

 

 

839

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percent Occupied

 

87.05

%

 

 

 

 

87.12

%

 

 

86.47

%

 

 

98.46

%

 

 

 

Lease Renewals:  The Partnership renewed 72.1% of leases up for renewal in 2002, totaling 8.7 million square feet on which it attained a 3.3% growth in net effective rents. Slower demand for rental space reduced rental rates during 2002.

 

The Partnership does not currently expect its renewal percentage or its growth in net effective rents on new leases in 2003 to significantly differ from the re-leasing activity in 2002.

 

Future Development: The Partnership also expects to realize growth in earnings from Rental Operations through the development and acquisition of additional rental properties. Specifically, the Partnership has approximately 3.1 million square feet of properties under development at December 31, 2002. These properties under development should provide future earnings through Service Operations income upon sale or from Rental Operations growth as they are placed in service as follows (in thousands, except percent leased and stabilized returns):

 

9



 

Anticipated In-Service Date

 

 

Square
Feet

 

Percent
Leased

 

Project
Costs

 

Anticipated
Stabilized
Return

 

Held for Rental:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1st Quarter 2003

 

638

 

100

%

$

22,385

 

9.7

%

2nd Quarter 2003

 

427

 

81

%

42,232

 

10.8

%

3rd Quarter 2003

 

38

 

69

%

3,373

 

11.9

%

Thereafter

 

1,462

 

68

%

73,899

 

10.3

%

 

 

2,565

 

78

%

$

141,889

 

10.4

%

Held for Sale:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1st Quarter 2003

 

17

 

82

%

$

2,335

 

13.5

%

2nd Quarter 2003

 

61

 

77

%

6,887

 

10.9

%

3rd Quarter 2003

 

159

 

70

%

15,204

 

12.0

%

Thereafter

 

256

 

100

%

28,707

 

8.9

%

 

 

493

 

87

%

$

53,133

 

10.2

%

 

 

 

 

 

 

 

 

 

 

Total

 

3,058

 

80

%

$

195,022

 

10.3

%

 

Results of Operations

 

A summary of the Partnership’s operating results and property statistics for each of the years in the three-year period ended December 31, 2002, is as follows (in thousands, except number of properties and per unit amounts):

 

 

 

2002

 

2001

 

2000

 

 

 

 

 

 

 

 

 

Rental Operations revenues

 

$

711,526

 

$

714,739

 

$

706,747

 

Service Operations revenues

 

67,620

 

80,459

 

82,799

 

Earnings from Rental Operations

 

219,114

 

254,103

 

225,183

 

Earnings from Service Operations

 

29,520

 

35,115

 

32,760

 

Operating income

 

223,899

 

273,665

 

236,806

 

Net income available for common units

 

179,746

 

262,430

 

245,029

 

Weighted average common units outstanding

 

149,423

 

147,961

 

145,906

 

Weighted average common and dilutive potential common units

 

150,839

 

151,710

 

147,441

 

Basic income per common unit:

 

 

 

 

 

 

 

Continuing operations

 

$

1.16

 

$

1.75

 

$

1.67

 

Discontinued operations

 

$

.04

 

$

.02

 

$

.01

 

Diluted income per common unit:

 

 

 

 

 

 

 

Continuing operations

 

$

1.15

 

$

1.73

 

$

1.65

 

Discontinued operations

 

.04

 

.02

 

.01

 

Number of in-service properties at end of year

 

910

 

888

 

913

 

In-service square footage at end of year

 

105,196

 

102,892

 

100,962

 

Under development square footage at end of year

 

3,058

 

4,701

 

8,056

 

 

Comparison of Year Ended December 31, 2002 to Year Ended December 31, 2001

 

Rental Operations

 

Rental Operations are comprised of net income from rental properties (“Rental Net Income”) and equity in earnings from unconsolidated companies (“Equity in Earnings”). Rental Net Income is defined as rental income less rental expenses and real estate taxes. Overall, Rental Net Income decreased from $492.1 million in 2001 to $483.9 million in 2002. The decrease is primarily attributable to an overall decrease in occupancy of the Partnership’s in-service portfolio from 88.6% at December 31, 2001, to 87.1% at December 31, 2002. This decrease is the result of the weakened economy and its effect on business in the Partnership’s markets. These markets are experiencing a shortage of demand compared to the supply of office and industrial space resulting from downsizing of leased space for existing tenants, the lack of new business growth, and the tendency of existing businesses to hold off on growth plans until the economy improves. These effects were somewhat mitigated by the Partnership recognizing $27.4 million and $18.3 million of lease termination fees in 2002 and 2001, respectively.

10



 

The Partnership analyzes the results of Rental Operations by office, industrial and retail portfolios. The following highlights the financial results for each of the Partnership’s Rental Operations portfolios.

 

Office

Rental Net Income for Office properties increased from $255.3 million in 2001, to $265.8 million in 2002 as a result of the following:

             The Partnership experienced an increase in its in-service Office portfolio occupancy from 86.0% at December 31, 2001, to 86.5% at December 31, 2002.

             The Partnership’s in-service Office portfolio has increased from 229 properties at December 31, 2001, to 239 properties at December 31, 2002.

             The Partnership recognized $21.7 million in termination fees associated with this segment in 2002, compared to $14.5 million in 2001.

 

Industrial

Rental Net Income for Industrial properties decreased to $212.6 million in 2002, from $223.1 million in 2001 as a result of the following:

 

             The Partnership experienced a decrease in its in-service Industrial portfolio occupancy from 89.3% at December 31, 2001, to 87.1% at December 31, 2002.

             The Partnership’s in-service Industrial portfolio increased from 649 properties at December 31, 2001 to 661 properties at December 31, 2002.

             The Partnership recognized $5.5 million of lease termination fees for the year ended December 31, 2002, compared to $3.6 million in 2001.

 

Retail

Rental Net Income for Retail properties decreased to $6.0 million in 2002, from $15.0 million in 2001 in connection with the following:

             In August of 2001, the Partnership sold 21 properties or approximately 75% of its retail portfolio.  As a result of this sale, the Partnership had eight months of operations associated with these properties in 2001.

             The Partnership’s Retail portfolio had an in-service occupancy percentage of 98.5% at December 31, 2002, compared to 96.8% at December 31, 2001.

 

Depreciation and amortization expense for the year ended December 31, 2002, increased over the prior year through an increase in the Partnership’s building asset basis, increased investments in tenant improvements and the expensing of undepreciated tenant improvements associated with the early terminations of tenants.

 

The $5.2 million increase in interest expense is attributable to the following:

 

             Interest capitalized on development projects decreased from $25.9 million in 2001 to $13.5 million in 2002 because of decreased development activity by the Partnership over the past twelve to eighteen months in response to soft demand in most of the Partnership’s markets.

             Interest expense on the Partnership’s unsecured debt increased from $98.7 million in 2001 to $100.8 million in 2002. The Partnership issued $150 million of ten-year unsecured debt in August 2002 at an effective interest rate of 5.88% and $50 million of ten-year unsecured debt in September 2002 at an effective interest rate of 5.45%. Also in 2002, the Partnership paid off $50 million of debt that matured in September, which had an effective rate of 7.31%.

             Interest expense on the Partnership’s secured debt decreased from $30.8 million in 2001 to $22.9 million in 2002 as the Partnership paid off $13.5 million of secured debt throughout 2002 and experienced lower borrowings on its secured line of credit during 2002 compared to 2001.  Additionally, the Partnership paid off approximately $128.5 million of secured debt throughout 2001.

 

11



 

             Interest expense on the Partnership’s $500 million unsecured line of credit decreased by approximately $1.1 million in 2002 compared to 2001 as the Partnership maintained lower balances on the line throughout most of 2002.

 

As a result of the above-mentioned items, earnings from Rental Operations decreased $35.0 million from $254.1 million for the year ended December 31, 2001, to $219.1 million for the year ended December 31, 2002.

 

Service Operations

 

Service Operations primarily consist of leasing, management, construction and development services for joint venture properties and properties owned by third parties. Service Operations revenues decreased from $80.5 million for the year ended December 31, 2001, to $67.6 million for the year ended December 31, 2002. The prolonged effect of the slow economy has been the primary factor in the overall decrease in revenues. The Partnership experienced a decrease of $12.7 million in net general contractor revenues because of a decrease in the volume of construction in 2002, compared to 2001, as well as slightly lower profit margins.

 

Property management, maintenance and leasing fee revenues decreased from $22.8 million in 2001 to $14.3 million in 2002 primarily because of a decrease in landscaping maintenance revenue resulting from the sale of the landscaping operations in the third quarter of 2001.

 

Construction management and development activity income represents construction and development fees earned on projects where the Partnership acts as the construction manager along with profits from the Partnership’s held for sale program whereby the Partnership develops a property for sale upon completion. The increase in revenues of $10.3 million in 2002 is primarily due to an increase in volume of the sale of properties from the held for sale program.

 

Service Operations expenses decreased from $45.3 million in 2001 to $38.1 million in 2002.  The decrease is attributable to the decrease in construction and development activity and the reduced overhead costs as a result of the sale of the landscape business in 2001.

 

As a result of the above, earnings from Service Operations decreased from $35.1 million for the year ended December 31, 2001, to $29.5 million for the year ended December 31, 2002.

 

General and Administrative Expense

 

General and Administrative Expense increased from $15.6 million in 2001 to $24.7 million for the year ended December 31, 2002. The Partnership has been successful reducing total operating and administration costs; however, reduced construction and development activities have resulted in a greater amount of overhead being charged to general and administrative expense instead of being capitalized into development projects or charged to Service Operations.

 

Other Income and Expenses

 

Gain on sale of land and depreciable property dispositions, net of impairment adjustment, is comprised of the following amounts in 2002 and 2001:

 

 

 

2002

 

2001

 

 

 

 

 

 

 

Gain on sales of depreciable properties

 

$

4,491

 

$

45,428

 

Gain on land sales

 

4,478

 

5,080

 

Impairment adjustment

 

(9,379

)

(4,800

)

 

 

 

 

 

 

Total

 

$

(410

)

$

45,708

 

 

Gain on sales of depreciable properties represent sales of previously held for investment rental properties. Beginning in 2000 and continuing into 2001, the Partnership pursued favorable opportunities to dispose of

 

12



 

real estate assets that no longer met long-term investment objectives. In 2002, the Partnership significantly reduced this property sales program until the business climate improves and provides better investment opportunities for the sale proceeds.

 

Gain on land sales represents sales of undeveloped land owned by the Partnership. The Partnership pursues opportunities to dispose of land in markets with a high concentration of undeveloped land and those markets where the land no longer meets strategic development plans of the Partnership.

 

The Partnership recorded a $9.4 million adjustment in 2002 associated with six properties determined to have an impairment of book value. The Partnership has analyzed each of its in-service properties and has determined that there are no additional valuation adjustments that need to be made as of December 31, 2002. The Partnership recorded an adjustment of $4.8 million in 2001 for one property that the Partnership had contracted to sell for a price less than its book value.

 

Other revenue for the year ended December 31, 2002, includes $1.4 million of gain related to an interest rate swap that did not qualify for hedge accounting.

 

Discontinued Operations

 

The Partnership adopted Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long Lived Assets” (“SFAS 144”), on January 1, 2002. SFAS 144 requires the Partnership to report in discontinued operations the results of operations of a property that has either been disposed or is classified as held for sale, unless certain conditions are met.

 

The Partnership classified the results of operations of seven buildings in its December 31, 2002, held for sale portfolio as discontinued operations in accordance with SFAS 144. In addition, two properties were sold during 2002 that were identified as held for sale post adoption of SFAS 144; therefore, the results of operations and gains on disposal for these two properties are also reported in discontinued operations. The results of operations and gains from disposal for all other properties sold during the year ended December 31, 2002, are classified in continuing operations as these properties were identified as held for sale prior to the adoption of SFAS 144. The effect of the adoption of SFAS 144 resulted in net income of $3.2 million and $3.6 million being classified as discontinued operations for the years ended December 31, 2002 and 2001, respectively.  Additionally, the gain of $2.7 million on the sale of the two properties sold in 2002 is classified as discontinued operations in accordance with SFAS 144.

 

Net Income Available for Common Unitholders

 

Net income available for common unitholders for the year ended December 31, 2002 was $179.7 million compared to $262.4 million for the year ended December 31, 2001. This decrease results primarily from operating result fluctuations in Rental Operations, Service Operations, General and Administrative Expenses and earnings from sales of depreciable property as discussed above.

 

Comparison of Year Ended December 31, 2001 to Year Ended December 31, 2000

 

Rental Operations

 

Rental Net Income decreased from $503.5 million in 2000 to $492.1 million in 2001. This decrease is the result of an overall decrease in occupancy of in-service properties from 93.6 % at December 31, 2000, to 88.6% at December 31, 2001. Also contributing to the decline in Rental Net Income is the effects of the Partnership’s property dispositions. During 2000 and 2001, the Partnership sold approximately $1 billion of held for investment rental properties from its in-service portfolio.  A majority of these properties were over 90% leased and the new developments placed in-service over the same time period were leased at lower percentages and therefore, the Partnership realized less rental income. These effects were somewhat mitigated by the Partnership recognizing $18.3 million and $7.0 million of lease termination fees in 2001 and 2000, respectively.

 

13



 

The Partnership analyzes the results of Rental Operations by office, industrial and retail portfolios.  The following highlights the financial results for each of the Partnership’s Rental Operations portfolios.

 

Office

Rental Net Income for Office properties increased from $225.5 million in 2000, to $255.3 million in 2001 as a result of the following:

             The Partnership experienced a decrease in its in-service Office portfolio occupancy from 91.3% at December 31, 2000, to 86.1% at December 31, 2001.

             The Partnership’s in-service Office portfolio increased from 232 properties at December 31, 2000 to 239 properties at December 31, 2001.

             The Partnership recognized $14.5 million in lease termination fees associated with this segment in 2001, compared to only $3.8 million in 2000.

 

Industrial

Rental Net Income for Industrial properties decreased to $223.1 million in 2001, from $256.3 million in 2000 as a result of the following:

             The Partnership experienced a decrease in its in-service Industrial portfolio occupancy from 94.2% at December 31, 2000, to 89.3% at December 31, 2001.

             The Partnership’s in-service Industrial portfolio decreased from 695 properties at December 31, 2000 to 663 properties at December 31, 2001.

             In 2001, the Partnership recognized $3.6 million of lease termination fees, compared to $2.9 million in 2000.

 

Retail

Rental Net Income for Retail properties decreased to $15.0 million in 2001, from $23.0 million in 2000 as a result of the following:

             In August of 2001, the Partnership sold 21 properties or approximately 75% of its retail portfolio.  As a result of this sale, the Partnership had only eight months of operations associated with these properties in 2001, compared to twelve in 2000.

             The Partnership’s retail portfolio had an in-service occupancy percentage of 96.7% at December 31, 2001, compared to 97.8% at December 31, 2000.

             The Partnership recognized approximately $235,000 of lease termination fees in 2001 compared to $289,000 in 2000.

 

The $19.5 million decrease in interest expense is primarily attributable to lower outstanding balances on the Partnership’s lines of credit associated with the financing of the Partnership’s investment and operating activities. The Partnership has maintained a significantly lower balance on its lines of credit throughout 2001 compared to 2000, as a result of its property dispositions proceeds used to fund future development, combined with a lower development level as a result of the slower economy. Additionally, the Partnership paid off $128.5 million of secured mortgage loans throughout 2001, as well as an $85 million unsecured term loan. These decreases were partially offset by an increase in interest expense on unsecured debt as a result of the Partnership issuing $175.0 million of debt in February 2001, as well as a decrease in the amount of interest capitalized in 2001 versus 2000, because of the decrease in development activity by the Partnership.

 

As a result of the above-mentioned items, earnings from Rental Operations increased $28.9 million from $225.2 million for the year ended December 31, 2000, to $254.1 million for the year ended December 31, 2001.

 

Service Operations

 

Service Operations revenues decreased from $82.8 million for the year ended December 31, 2000, to $80.5 million for the year ended December 31, 2001. The Partnership experienced a decrease of $4.3

 

14



 

million in net general contractor revenues from third party jobs because of a decrease in the volume of construction in 2001, compared to 2000, as well as slightly lower profit margins. This decrease is the effect of businesses delaying or terminating plans to expand in the wake of the slowed economy.

 

Property management, maintenance and leasing fee revenues decreased approximately $2.7 million mainly because of a decrease in landscaping maintenance revenue associated with the sale of the landscape business in the third quarter of 2001 (see discussion below).

 

Construction management and development activity income represents construction and development fees earned on projects where the Partnership acts as the construction manager along with profits from the Partnership’s held for sale program whereby the Partnership develops a property for sale upon completion. The increase in revenues of $2.2 million in 2001 is primarily because of an increase in profits on the sale of properties from the held for sale program.

 

Other income increased approximately $2.4 million in 2001 over 2000; due to a $1.8 million gain the Partnership recognized on the sale of its landscape business in the third quarter of 2001. The sale of the landscape business resulted in a total net profit of over $9 million after deducting all related expenses. This gain will be recognized in varying amounts over the next seven years because the Partnership has an on-going contract to purchase future services from the buyer.

 

Service Operations expenses decreased by $4.7 million for the year ended December 31, 2001, compared to the same period in 2000, as the Partnership reduced total overhead costs throughout 2001 in an effort to minimize the effects of decreased construction and development activity. The primary savings were experienced in employee salary and related costs through personnel reductions and reduced overhead costs from the sale of the landscaping business.

 

As a result, earnings from Service Operations increased from $32.8 million for the year ended December 31, 2000, to $35.1 million for the year ended December 31, 2001.

 

General and Administrative Expense

 

General and Administrative Expense decreased from $21.1 million in 2000 to $15.6 million for the year ended December 31, 2001, through overhead cost reduction efforts. In late 2000 and continuing throughout 2001, the Partnership introduced several cost cutting measures to reduce the amount of overhead, including personnel reductions, centralization of responsibilities and reduction of employee costs such as travel and entertainment.

 

Other Income and Expenses

 

Gain on sale of land and depreciable property dispositions, net of impairment adjustment, was comprised of the following amounts in 2001 and 2000:

 

 

 

2001

 

2000

 

 

 

 

 

 

 

Gain on sales of depreciable properties

 

$

45,428

 

$

52,067

 

Gain on land sales

 

5,080

 

9,165

 

Impairment adjustment

 

(4,800

)

(540

)

 

 

 

 

 

 

Total

 

$

45,708

 

$

60,692

 

 

Gain on sales of depreciable properties represent sales of previously held for investment rental properties. Beginning in 2000 and continuing into 2001, the Partnership pursued favorable opportunities to dispose of real estate assets that no longer meet long-term investment objectives.

 

Gain on land sales represents sales of undeveloped land owned by the Partnership. The Partnership pursues opportunities to dispose of land in markets with a high concentration of undeveloped land and those markets where the land no longer meets strategic development plans of the Partnership.

 

15



 

The Partnership recorded a $4.8 million asset impairment adjustment in 2001 on a single property that was sold in 2002.

 

Other expense for the year ended December 31, 2001, includes a $1.4 million expense related to an interest rate swap that does not qualify for hedge accounting.

 

Net Income Available for Common Unitholders

 

Net income available for common unitholders for the year ended December 31, 2001 was $262.4 million compared to $245.0 million for the year ended December 31, 2000. This increase results primarily from the operating result fluctuations in Rental and Service Operations and earnings from sales of real estate assets explained above.

 

Critical Accounting Policies

 

The preparation of the Partnership’s consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period.  The Partnership’s estimates, judgments and assumptions are continually evaluated based upon available information and experience.  Note 1 to the Consolidated Financial Statements includes further discussion of the Partnership’s significant accounting policies.

 

The Partnership has assessed the accounting policies used in the preparation of its financial statements.  The following accounting policies are considered critical based upon materiality to the financial statements, degree of judgment involved in estimating reported amounts and sensitivity to changes in industry and economic conditions:

 

Accounting for joint ventures: The Partnership has equity interests ranging from 10-95% in joint ventures that own and operate rental properties and hold land for development. The Partnership consolidates those joint ventures that it controls through majority ownership interests or substantial participating rights. Control is further demonstrated by the ability of the general partner to manage day-to-day operations, refinance debt and sell the assets of the joint venture without the consent of the limited partner and inability of the limited partner to replace the general partner. The Partnership uses the equity method of accounting for those joint ventures where the Partnership does not have control over operating and financial polices. Under the equity method of accounting, the assets and liabilities of joint ventures for which the Partnership uses the equity method are not included on the Partnership’s balance sheet.

 

Cost Capitalization:  Direct and certain indirect costs, including interest, clearly associated with the development, construction, leasing or expansion of real estate investments are capitalized as a cost of the property.  The following discusses the significant categories of costs incurred by the Partnership:

 

Within the Rental Operations of the Partnership, direct and indirect costs are capitalized under the guidelines of FASB 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects (“FASB 67”) and interest costs are capitalized under the guidelines of FASB 34, “Capitalization of Interest Cost” (“FASB 34”). The Partnership capitalizes these project costs associated with the initial construction of a property up to the time the property is substantially complete and ready for its intended use. The Partnership believes the completion of the building shell is the proper basis for determining substantial completion and that this basis is the most widely accepted standard in the real estate industry. The interest rate used to capitalize costs is based upon the Partnership’s average borrowing rate on existing debt.

 

In addition, the Partnership capitalizes costs, including interest costs, on vacant space during extended lease-up periods after construction of the building shell has been completed if costs are being incurred to ready the vacant space for its intended use.  If costs and activities incurred to ready the vacant space cease, then cost

 

16



 

capitalization is also discontinued until such activities are resumed. Once necessary work has been completed on a vacant space, project costs are no longer capitalized. The Partnership ceases capitalization of all project costs on extended lease-up periods after the shorter of a one-year period after the completion of the building shell or when the property attains a 90% occupancy. The Partnership follows guidelines in FASB 34 and FASB 67 in determining the capitalization of project costs during the lease-up period of a property and believes that this treatment is consistent with real estate industry standards for project cost capitalization.

 

A portion of the direct costs associated with the construction/development division and the leasing division, as well as a portion of indirect costs, are capitalized into the cost of specific construction/development and leasing projects. The capitalized portion of these costs is based upon standard charges determined by the Partnership. The standard charges were established based upon time estimates developed by the Partnership to cover the direct overhead costs of the construction/ development and leasing divisions and a portion of the remaining indirect overhead of the Partnership. The Partnership reviews these standards on a quarterly basis to ensure that the amounts capitalized are appropriate.

 

Impairment of Real Estate Investments: The Partnership evaluates its real estate investments upon occurrence of significant changes in the operations, but not less than annually, to assess whether any impairment indications are present that affect the recovery of the recorded value. If any real estate investment is considered impaired, a loss is provided to reduce the carrying value of the asset to its estimated fair value. The Partnership utilizes the guidelines established under SFAS 144 to determine if impairment conditions exist. Under SFAS 144, the Partnership reviews the expected undiscounted cash flows of each property in its held for rental portfolio to determine if there are any indications of impairment of a property. The review of anticipated cash flows involves subjective assumptions of estimated occupancy and rental rates and ultimate residual value. In addition to reviewing anticipated cash flows, the Partnership assesses other factors such as changes in business climate and legal factors that may affect the ultimate value of the property. These assumptions are subjective and may not ultimately be achieved.

 

Real estate assets to be disposed of are reported at the lower of their carrying value amount or the fair value less cost to sell.

 

Valuation of Receivables:  The Partnership is subject to tenant defaults and bankruptcies that could affect the collection of outstanding receivables. In order to mitigate these risks, the Partnership performs in-house credit review and analysis on major existing tenants and all significant leases before they are executed. The Partnership has the following procedures and policies to evaluate the collectibility of outstanding receivables and record allowances:

 

             A tenant “watch list” as well as a list of the 100 largest tenants based upon annual gross rent is maintained and monitored for tenants with potential risk; and

             The Partnership has a defined accounting policy to reserve for the entire tenant receivable balance of any tenant with an amount outstanding over 90 days.

 

Revenue Recognition on Long-Term Construction Contracts:  The Partnership recognizes income on long-term construction contracts where the Partnership serves as a general contractor on the percentage of completion method. Using this method, profits are recorded on the basis of the Partnership’s estimates of the overall profit and percentage of completion of individual contracts. A portion of the estimated profits is accrued based upon the Partnership’s estimates of the percentage of completion of the construction contract. Cumulative revenues recognized may be less or greater than cumulative costs and profits billed at any point in time during a contract’s term. This revenue recognition method involves inherent risk relating to profit and cost estimates that is reduced through approval and monitoring processes.

 

 

17



With regards to critical accounting policies, management has discussed the following with the Audit Committee of the General Partner’s Board of Directors:

 

             Criteria for identifying and selecting;

             Methodology in applying; and

             Impact to the financial statements.

 

Liquidity and Capital Resources

 

Sources of Liquidity

 

The Partnership expects to meet liquidity requirements over the next twelve months, including payments of dividends and distributions as well as recurring capital expenditures relating to maintaining the Partnership’s current real estate assets, primarily through the following:

 

              working capital; and

              net cash provided by operating activities.

 

The Partnership expects to meet long-term liquidity requirements, such as scheduled mortgage debt maturities, the retirement of unsecured notes and amounts outstanding under the unsecured credit facility, property acquisitions, financing of development activities and other non-recurring capital improvements, through the following:

 

              issuance of additional unsecured notes;

              undistributed cash available for distribution, if any; and

              proceeds received from real estate dispositions.

 

Rental Operations

The Partnership believes that its principal source of liquidity, cash flows from Rental Operations, provides a stable source of cash to fund operational expenses. The Partnership believes that this cash based revenue stream is substantially aligned with revenue recognition (except for periodic straight-line rental income accruals) as cash receipts from the leasing of rental properties are generally received in advance of or in a short time following the actual revenue recognition. The Partnership is subject to risks of decreased occupancy through market conditions as well as tenant defaults and bankruptcies, which would result in reduced cash flow from operations. However, management believes that these risks are mitigated by the Partnership’s strong market presence in most of its locations and the fact that the Partnership performs in-house credit review and analysis on major tenants and all significant leases before they are executed.

 

Credit Facilities

The Partnership has the following lines of credit available (in thousands):

 

Description

 

Borrowing
Capacity

 

Maturity
Date

 

Interest
Rate

 

Amount
Outstanding
at December
31, 2002

 

Unsecured Line of Credit

 

$

500,000

 

February 2004

 

LIBOR + .65

%

$

281,000

 

Secured Line of Credit

 

$

50,000

 

January 2006

 

LIBOR + .60

%

$

23,895

 

 

The lines of credit are used to fund development and acquisition of additional rental properties and to provide working capital.

 

In December 2002, the Partnership renewed its secured line of credit and reduced the amount available from $100 million to $50 million, reduced the interest rate from LIBOR + 1.05% to LIBOR + .60%, and extended the maturity date to January 2006.

 

Associated with the $500 million line of credit are financial covenants that require the Partnership to meet defined levels of performance. As of December 31, 2002, the Partnership is in compliance with all covenants pertaining to the $500 million line of credit.

 

Debt and Equity Securities

The Partnership currently has on file with the SEC an effective shelf registration statement that permits the Partnership to sell up to an additional $420 million of unsecured debt securities.  In addition, the General

 

18



 

Partner has on file with the SEC an effective shelf registration statement that permits the General Partner to sell up to an additional $250.7 million of common and preferred stock. From time-to-time, the Partnership and General Partner expect to issue additional securities under these registration statements to fund development and acquisition of additional rental properties and to fund the repayment of the credit facilities and other long-term debt upon maturity.

 

The indenture governing the Partnership’s unsecured notes also requires the Partnership to comply with financial ratios and other covenants regarding the operations of the Partnership. The Partnership is currently in compliance with all such covenants and expects to remain in compliance in the foreseeable future.

 

In January 2003, the Partnership completed an issuance of unsecured debt totaling $175 million bearing interest at 5.25%, due 2010.

 

Sale of Real Estate Assets

The Partnership utilizes sales of real estate assets as an additional source of liquidity.  During 2000 and 2001, the Partnership engaged in a capital-recycling program that resulted in sales of over $1 billion of real estate assets during these two years. In 2002, this program was substantially reduced as capital needs were met through other sources and the slower business climate provided fewer opportunities to profitably reinvest sale proceeds. The Partnership continues to pursue opportunities to sell real estate assets when beneficial to the long-term strategy of the Partnership.

 

Uses of Liquidity

 

The Partnership’s principal uses of liquidity include the following:

 

              Property investments and recurring leasing/capital costs;

              Dividends and distributions to shareholders and unitholders;

              Long-term debt maturities; and

              The General Partner’s common stock repurchase program.

 

Property Investments and Other Capital Expenditures

One of the Partnership’s principal uses of its liquidity is for the development, acquisition and recurring leasing/capital expenditures of its real estate investments.

 

A summary of the Partnership’s recurring capital expenditures is as follows (in thousands):

 

 

 

2002

 

2001

 

2000

 

 

 

 

 

 

 

 

 

Tenant improvements

 

$

28,011

 

$

18,416

 

$

31,955

 

Leasing costs

 

17,975

 

13,845

 

17,530

 

Building improvements

 

13,373

 

10,873

 

6,804

 

Totals

 

$

59,359

 

$

43,134

 

$

56,289

 

 

Dividends and Distributions

In order to qualify as a REIT for federal income tax purposes, the General Partner must currently distribute at least 90% of its taxable income to its shareholders. The Partnership paid distributions of $1.81, $1.76 and $1.64 for the years ended December 31, 2002, 2001 and 2000, respectively. The Partnership expects to continue to distribute taxable earnings at least to the extent necessary for the General Partner to maintain its REIT status. However, distributions are declared at the discretion of the General Partner’s Board of Directors and are subject to actual cash available for distribution, the Partnership’s financial condition, capital requirements and such other factors as the Board of Directors deems relevant.

 

Debt Maturities

Debt outstanding at December 31, 2002, totals $2.1 billion with a weighted average interest rate of 6.25% maturing at various dates through 2028. The Partnership had $1.8 billion of unsecured debt and $299.1 million of secured debt outstanding at December 31, 2002. Scheduled principal amortization of such debt totaled $10.9 million for the year ended December 31, 2002.

 

19



 

Following is a summary of the scheduled future amortization and maturities of the Partnership’s indebtedness at December 31, 2002 (in thousands):

 

 

 

 

 

Weighted Average
Interest Rate of
Future Repayments

 

Year

 

Future Repayments

 

 

Scheduled
Amortization

 

Maturities

 

Total

 

 

 

 

 

 

 

 

 

 

2003

 

$

10,309

 

$

249,437

 

$

259,746

 

7.61

%

2004

 

8,724

 

462,151

 

470,875

 

4.11

%

2005

 

8,192

 

205,980

 

214,172

 

7.17

%

2006

 

7,702

 

170,074

 

177,776

 

6.38

%

2007

 

5,932

 

114,615

 

120,547

 

7.07

%

2008

 

4,939

 

133,852

 

138,791

 

6.20

%

2009

 

4,802

 

275,000

 

279,802

 

7.31

%

2010

 

4,194

 

 

4,194

 

6.30

%

2011

 

3,462

 

175,000

 

178,462

 

6.93

%

2012

 

1,977

 

200,000

 

201,977

 

5.76

%

Thereafter

 

9,943

 

50,000

 

59,943

 

6.54

%

 

 

$

70,176

 

$

2,036,109

 

$

2,106,285

 

6.25

%

 

Common Stock Repurchase Program

In January 2000, the General Partner’s Board of Directors authorized a common stock repurchase program pursuant to which the General Partner was authorized to purchase up to $100 million of currently issued and outstanding common stock. During 2001, the General Partner’s Board of Directors increased the size of this common stock repurchase program to $250 million. This authority may be exercised from time to time and in such amounts as market conditions warrant. As of December 31, 2002, the General Partner has purchased 20,000 shares of common stock valued at $437,000 under the repurchase program. The General Partner considers the price of its common stock and the effect of repurchases on its financial condition in determining whether to purchase common stock under its repurchase program.

 

Historical Cash Flows

 

Cash and cash equivalents were $17.1 million, $10.5 million and $39.2 million at December 31, 2002, 2001 and 2000, respectively.  The 2002 increase of $6.6 million and 2001 decrease of $28.7 million is the result of the following increases and decreases in cash flows (amounts in thousands):

 

 

 

Years Ended December 31,

 

 

 

2002

 

2001

 

2000

 

Net cash provided by Operating Activities

 

$

569.0

 

$

348.7

 

$

363.6

 

 

 

 

 

 

 

 

 

Net Cash Provided (Used) by Investing Activities

 

$

(337.2

)

$

93.5

 

$

(12.0

)

 

 

 

 

 

 

 

 

Net Cash Used for Financing Activities

 

$

(225.1

)

$

(470.9

)

$

(331.0

)

 

Operating Activities

The $220.3 million increase in net cash provided by operating activities in 2002 compared to 2001 resulted primarily from the following:

              The Partnership received net proceeds of $168.2 million from its Build-to-Suit operations in 2002, compared to incurring net development costs of $79.9 million in 2001.  During 2002, the Partnership sold eight properties from its Build-to-Suit portfolio and at the same time reduced its development pipeline in favor of developing properties to be held as rental investments.

 

The Partnership’s net cash provided by operating activities decrease of $14.7 million from 2000 to 2001 was primarily the result of changes in cash provided by changes in operating and assets and liabilities.

 

 

20



Investing Activities

The decrease from net cash provided by investing activities in 2001 to 2002 was attributable to the following:

 

              During 2001, the Partnership’s capital recycling program provided $436.1 million in net proceeds from land and depreciated property sales, compared to $52.2 million in 2002, as the Partnership curtailed its recycling program.

              Real estate development costs decreased from $251.4 million in 2001 to $158.1 million in 2002, due to a reduction in new development in 2002 in response to weakened demand in many of the Partnership’s markets.

              The Partnership acquired $98.1 million of real estate assets in 2002 compared to $13.9 million in 2001.

              The Partnership acquired $92.2 million of undeveloped land in 2001 compared to $27.2 million in 2002. The Partnership continually evaluates its inventory of undeveloped land and strives to keep only land that meets long-term development opportunities.

              In 2001, the Partnership received $50.0 million in distributions from unconsolidated companies associated with proceeds received from financing transactions on two joint ventures in which the Partnership has a 50% ownership interest.

 

The change from net cash used by investing activities in 2000 to net cash provided by investing activities in 2001 was the result of the following:

              Real estate development costs decreased by $54.9 million.

              Cash from tax deferred exchange escrow, net, increased by $43.5 million with the increased activity in the capital-recycling program.

              In 2001, net proceeds from land and depreciated property sales increased by $22.4 million in connection with the capital recycling program.

              Net decreases in recurring tenant improvements, leasing costs and deferred leasing costs of $45.6 million.

              In 2000, the Partnership received $158.4 million in distributions from unconsolidated companies as a result of significant financing transactions with two joint ventures in which the Partnership has a 50% ownership interest (See discussion under Investments in Unconsolidated Companies).

 

Financing Activities

The $245.8 million decrease in net cash used for financing activities from 2001 to 2002 resulted from the following:

                The Partnership had net borrowings of $157.3 million on its unsecured line of credit in 2002 compared to net repayments of $125.1 million in 2001. The change is primarily due to the Partnership’s increased use of its line of credit in the latter part of 2002.

                During 2002, the General Partner redeemed its Series F Preferred Stock for $150.0 million and a portion of its Series B Preferred Stock for $17.7 million. In 2001, the General Partner redeemed its Series A Preferred Stock for $75.0 million and issued its Series I Preferred Stock for net proceeds of $72.2 million.

                In 2002, the Partnership redeemed its Series G Preferred Units for $35.0 million.

                In 2002, the Partnership issued $200.0 million of unsecured debt compared to $175.0 million in 2001.

                The Partnership paid off $223.6 million of secured and unsecured debt in 2001 compared to $72.0 million in 2002. During 2001, the Partnership took advantage of excess liquidity to pay off a portion of its secured debt early.

                Distributions to common unitholders increased from $262.2 million in 2001 to $271.7 million in 2002, which reflects the increase in common units outstanding and the quarterly per unit dividend increase from $.45 to $.455 in 2002.

 

The $139.9 million increase in net cash used for financing activities from 2000 to 2001 was attributable to the following:

                The Partnership had net borrowings of $14.7 million in 2000 compared to net repayments of $125.1 million in 2001 as discussed above.

 

21



 

              The Partnership paid off $75.7 million of secured debt in 2000 compared to $223.6 million in 2001 as discussed above.

 

Credit Ratings

 

The General Partner and the Partnership are currently assigned investment grade corporate credit ratings on senior unsecured notes from Fitch Ratings, Moody’s Investor Service and Standard and Poor’s Ratings Group. Currently, Fitch and Standard and Poor’s have assigned a rating of BBB+ and Moody’s Investors has assigned a rating of Baa1 to the senior notes.These ratings could change based upon, among other things, the Partnership’s results of operations and financial condition.

 

The General Partner and the Partnership also receive credit ratings from the same rating agencies on preferred stock.  Fitch and Standard and Poor’s have assigned a rating of BBB and Moody’s Investors has assigned a rating of Baa2. These ratings could change based upon, among other things, the Partnership’s results of operations and financial condition.

 

Derivative Financial Instruments

 

The Partnership is exposed to capital market risk, such as changes in interest rates.  In order to manage the volatility relating to interest rate risk, the Partnership may enter into interest rate hedging arrangements from time to time. The Partnership does not utilize derivative financial instruments for trading or speculative purposes. On January 1, 2001, the Partnership adopted Statement of Financial Accounting Standard No. 133, “Accounting for Derivative Instruments and Hedging Activities”, as amended (“SFAS 133”). SFAS 133 establishes accounting and reporting standards for derivative instruments and requires that entities recognize all derivatives as either assets or liabilities and measure those instruments at fair value. The cumulative effect of adopting SFAS 133 was not material to the Partnership’s financial statements.

 

During the years ended December 31, 2002 and 2001, the Partnership recorded a $1.4 million gain and a $1.4 million loss, respectively, associated with an interest rate contract that did not qualify for hedge accounting. The contract expired on December 30, 2002.

 

In December 2002, the Partnership simultaneously entered into two $50 million forward-starting interest rate swaps. The Partnership designated the aggregate $100 million swaps as a hedge to effectively fix the rate on financing expected in 2003. The Partnership expects and intends that the financing will be a ten-year fixed-rate semi-annual financing, pricing between May 1, 2003 and November 1, 2003. The fair value of the swaps was a liability of ($2.1) million as of December 31, 2002, and is recorded in other liabilities in the accompanying balance sheet. The swaps qualify for hedge accounting under SFAS 133, therefore, changes in fair value will be recorded in other comprehensive income.

 

In July 2001, the Partnership terminated three interest rate swaps that were tied to an $85 million unsecured term loan. The swaps qualified for hedge accounting under SFAS 133. The costs to terminate the swaps was $548,000, which was recorded as interest expense and reversed out of other comprehensive income.

 

Investments in Unconsolidated Companies

 

The Partnership has equity interests ranging from 10 – 64% in unconsolidated partnerships and joint ventures that own and operate rental properties and hold land for development. The equity method of accounting is used for these investments in which the Partnership has the ability to exercise significant influence, but not control, over operating and financial policies. As a result, the assets and liabilities of these joint ventures are not included on the Partnership’s balance sheet.

 

The Partnership’s investment in unconsolidated companies represents less than 6% of the Partnership’s total assets as of December 31, 2002. This investment provides several benefits to the Partnership including increased market share and an additional source of capital to fund real estate projects.

 

22



 

The following tables presents summarized financial information for the Partnership’s investments in unconsolidated companies for the years ended December 31, 2002 and 2001 (in thousands, except percentages):

 

 

 

Dugan
Realty, LLC

 

Dugan
Texas, LLC

 

Dugan
Office, LLC

 

Other Industrial
and Office
Joint Ventures

 

Total

 

 

 

2002

 

2001

 

2002

 

2001

 

2002

 

2001

 

2002

 

2001

 

2002

 

2001

 

Land, buildings and tenant improvements, net

 

$

739,372

 

$

748,318

 

$

214,796

 

$

204,339

 

$

94,718

 

$

97,855

 

$

183,140

 

$

210,978

 

$

1,232,026

 

$

1,261,490

 

Land held for development

 

18,763

 

18,572

 

9,148

 

12,453

 

4,294

 

4,293

 

6,643

 

6,644

 

38,848

 

41,962

 

Other Assets

 

26,372

 

23,443

 

17,427

 

9,484

 

4,654

 

4,383

 

19,137

 

24,707

 

67,590

 

62,017

 

 

 

$

784,507

 

$

790,333

 

$

241,371

 

$

226,276

 

$

103,666

 

$

106,531

 

$

208,920

 

$

242,329

 

$

1,338,464

 

$

1,365,469

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property indebtedness

 

$

408,305

 

$

401,185

 

$

17,200

 

$

17,200

 

$

69,936

 

$

70,658

 

$

84,452

 

$

92,434

 

$

579,893

 

$

581,477

 

Other liabilities

 

17,533

 

19,086

 

7,851

 

8,172

 

3,790

 

3,308

 

22,883

 

30,043

 

52,057

 

60,609

 

 

 

425,838

 

420,271

 

25,051

 

25,372

 

73,726

 

73,966

 

107,335

 

122,477

 

631,950

 

642,086

 

Owner’s equity

 

358,669

 

370,062

 

216,320

 

200,904

 

29,940

 

32,565

 

101,585

 

119,852

 

706,514

 

723,383

 

 

 

$

784,507

 

$

790,333

 

$

241,371

 

$

226,276

 

$

103,666

 

$

106,531

 

$

208,920

 

$

242,329

 

$

1,338,464

 

$

1,365,469

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental income

 

$

94,176

 

$

93,562

 

$

26,636

 

$

24,459

 

$

17,280

 

$

18,698

 

$

31,591

 

$

35,538

 

$

169,683

 

$

172,257

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

28,164

 

$

27,381

 

$

13,308

 

$

13,532

 

$

1,660

 

$

4,965

 

$

7,881

 

$

12,213

 

$

51,013

 

$

58,091

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total square feet

 

22,757

 

23,356

 

5,878

 

5,719

 

648

 

648

 

5,452

 

5,936

 

34,735

 

35,659

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percent leased

 

94.1

%

92.8

%

95.3

%

85.9

%

95.3

%

94.6

%

87.2

%

79.2

%

93.2

%

89.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Partnership ownership percentage

 

50.0

%

50.0

%

50.0

%

50.0

%

50.0

%

50.0

%

10.0% -64.0

%

10.0% -64.0

%

 

 

 

 

 

In October 2000, the Partnership sold or contributed industrial properties and undeveloped land with a fair value of $487 million to a joint venture (Dugan Realty LLC) in which the Partnership has a 50% interest and recognized a net gain of $35.2 million. This transaction expanded an existing joint venture with an institutional real estate investor. As a result of the total transactions, the Partnership received $363.9 million of proceeds. The joint venture partially financed this transaction with $350 million of secured mortgage debt of which the Partnership has guaranteed $90 million and agreed to provide additional capital contributions to pay all sums due under the remaining $260 million. At December 31, 2002, this $350 million of debt is collateralized by rental properties with a net carrying value substantially in excess of the outstanding debt. If required to make additional capital contributions, the Partnership will receive proportionately increased ownership in the respective collateralized properties. The Partnership does not anticipate that it will be required to satisfy the guarantee or additional capital contribution obligations. In connection with this transaction, the joint venture partners were given an option to put up to a $50 million interest in the joint venture to the Partnership in exchange for common stock of the General Partner or cash, subject to timing and other restrictions. As a result of this put option, the Partnership deferred $10.2 million of gain on sale of depreciated property and recorded a $50 million liability. At December 31, 2002, the joint venture owns 130 buildings totaling approximately 23 million square feet with a value of approximately $760 million. The Partnership provides real estate related services to the venture through its Service Operations.

 

In December 2000, the Partnership contributed 14 industrial properties, including five under development, totaling approximately three million square feet to a joint venture (Dugan Texas LLC) in which the Partnership has a 50% interest. The Partnership also contributed 145 acres of undeveloped land. The Partnership received $33.1 million of proceeds and recorded a net gain of $686,000 as a result of the transaction. At December 31, 2002, the joint venture owns 32 buildings totaling approximately 6 million square feet with a value of approximately $224 million. The Partnership provides real estate related services to the venture through its Service Operations.

 

The Partnership does not have any relationships with unconsolidated entities or financial partnerships, such as “special purpose entities,” which were established for the purpose of facilitating off-balance sheet arrangements or other specific purposes.

 

Related Party Transactions

 

The Partnership provides property management, leasing, construction and other tenant related services to properties in which certain executives have ownership interests. The Partnership has an option to acquire

 

23



 

these executive officers’ interests in these properties (the “Option Properties”). The Partnership received fees totaling $1.4 million, $1.7 million and $1.9 million in 2002, 2001 and 2000, respectively, for services provided to the Option Properties. The fees charged by the Partnership for such services are equivalent to those charged to third-party owners for similar services.

 

On June 27, 2001, A. Ray Weeks, Jr. resigned his position as a director and Vice Chairman of the General Partner. On August 17, 2001, the Partnership redeemed 620,156 common units beneficially owned by Mr. Weeks and certain members of his immediate and extended family (the “Weeks Affiliates”). The deemed value of the units redeemed was $15.7 million, which was based on the average closing stock price of the General Partner’s common stock for a certain period of days preceding the redemption date. As consideration for the redemption, the Weeks Affiliates received a distribution of seven industrial rental properties and one undeveloped tract of land located in the Atlanta, Georgia metropolitan area with a value of $31.7 million. The Weeks Affiliates also assumed a loan in the amount of $16 million from Wachovia Bank, N.A. to the Partnership. The value of the properties distributed to the Weeks Affiliates was based on negotiations between Mr. Weeks and members of the General Partner’s executive committee, and was approved by the unaffiliated members of the General Partner’s Board of Directors.

 

In 2002, the Partnership received lease termination fees totaling $7.7 million from a tenant that is a subsidiary of Progress Energy. William Cavanaugh III is President and Chief Executive Officer of Progress Energy and a member of the General Partner’s Board of Directors. The General Partner’s independent directors approved the transaction and management believes that the amount received approximates a value that would have been charged to tenants with similar lease terms and commitments.

 

The Partnership has other related party transactions that are insignificant and terms are considered to be at arm’s-length and equal to those negotiated with independent parties.

 

Commitments and Contingencies

 

The Partnership has the following commitments and contingencies in addition to those previously disclosed:

 

In 1998 and 1999, members of management and the General Partner’s Board of Directors purchased $69 million of common stock in connection with an Executive and Senior Officer Stock Purchase Plan. The purchases were financed by five-year personal loans at market interest rates from financial institutions. As of December 31, 2002, the outstanding balance on these loans is $33.5 million as some participants have exited the program and repaid their principal balance. These loans are secured by $41.0 million of the General Partner’s common shares (based on a price per share of $25.45 at December 31, 2002) purchased through this program and held at December 31, 2002, by the remaining plan participants. As a condition of the financing agreement with the financial institution, the Partnership has guaranteed repayment of principal, interest and other obligations for each participant, but is fully indemnified by the participants. In the opinion of management, it is not probable that the Partnership will be required to satisfy these guarantees.

 

The Partnership has entered into agreements, subject to the completion of due diligence requirements, resolution of certain contingencies and completion of customary closing conditions, for the future acquisition of land totaling $26.2 million. The acquisitions are scheduled to close periodically through 2003.

 

The Partnership renewed all major insurance programs for 2002-2003, including obtaining coverage for acts of terrorism for its properties. The Partnership believes that insurance is in place that provides adequate coverage to provide financial protection against normal insurance risks such that it believes that any loss experienced would not have a significant impact on the Partnership’s liquidity, financial position, or results of operations.

 

The Partnership is subject to various legal proceedings and claims that arise in the ordinary course of business. In the opinion of management, the amount of any ultimate liability with respect to these actions will not materially affect the Partnership’s consolidated financial statements or results of operations.

 

24



 

Funds From Operations

 

Management believes that Funds From Operations (“FFO”) is the industry standard for reporting the operations of real estate investment trusts. FFO is defined by the National Association of Real Estate Investment Trusts as GAAP net income or loss, excluding gains or losses from sales of depreciated operating property, plus operating property depreciation and amortization and adjustments for minority interest and unconsolidated companies on the same basis.

 

The following table reflects the calculation of FFO for the years ended December 31 (in thousands):

 

 

 

2002

 

2001

 

2000

 

 

 

 

 

 

 

 

 

Net income available for common units

 

$

179,746

 

$

262,430

 

$

245,029

 

Add back (deduct):

 

 

 

 

 

 

 

Depreciation and amortization

 

175,621

 

159,714

 

162,523

 

Share of adjustments for unconsolidated companies

 

17,657

 

14,177

 

9,104

 

Loss (Earnings) from depreciated property sales

 

3,430

 

(40,628

)

(51,527

)

Funds From Operations

 

$

376,454

 

$

395,693

 

$

365,129

 

Cash flow provided by (used by):

 

 

 

 

 

 

 

Operating activities

 

$

568,973

 

$

348,680

 

$

363,610

 

Investing activities

 

(337,247

)

93,488

 

(11,972

)

Financing activities

 

(225,050

)

(470,915

)

(330,952

)

 

While management believes that FFO is the most relevant and widely used measure of the Partnership’s operating performance, such amount does not represent cash flow from operations as defined by generally accepted accounting principles, should not be considered as an alternative to net income as an indicator of the Partnership’s operating performance, and is not indicative of cash available to fund all cash flow needs.

 

Accounting Changes

 

The Partnership elected to prospectively adopt Statement of Financial Accounting Standards (“SFAS”) No. 123, “Accounting for Stock Based Compensation,”(“SFAS 123”) effective January 1, 2002. As a result, the Partnership expenses stock options over the vesting period based upon the estimated fair value of the options at the date of grant. Additionally, the Partnership expenses the discount given to employees under the employee stock purchase plan. The Partnership recorded expense of $405,000 for the year ended 2002 related to stock compensation from this accounting change.

 

In conjunction with the adoption of SFAS 123, the Partnership adopted SFAS No. 148, “Accounting for Stock Based Compensation- Transition and Disclosure,” which amends SFAS No. 123.  SFAS No. 148 provides for alternative methods of transition for a voluntary adoption of SFAS 123 and amends the disclosure requirements of SFAS 123 to require 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. The adoption of this statement using the prospective method did not have a material impact on the financial position or results of operations of the Partnership.

 

The Partnership adopted SFAS No. 144, “Accounting for the Impairment or Disposal of Long Lived Assets,” (“SFAS 144”) on January 1, 2002.  SFAS 144 requires the Partnership to report in discontinued operations the results of operations of a property that has either been disposed of or is classified as held for sale, unless certain conditions are met. The effect of adoption of SFAS 144 resulted in net income of $3.2 million, $3.6 million and $1.2 million being classified as discontinued operations for the three years ended December 31, 2002, 2001 and 2000, respectively. SFAS 144 also requires that any gains or losses from the sale of a property be reported in discontinued operations, unless certain conditions are met. The Partnership also classified a gain on the sale of properties of $2.7 million as discontinued operations for the year ended December 31, 2002.

 

25



 

Recent Accounting Pronouncements

 

In April 2002, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 145, which rescinded SFAS No. 4, SFAS No. 44 and SFAS No. 64, as well as amending SFAS No. 13.  The adoption of this statement is not expected to have a material impact on the financial position or results of operations of the Partnership.

 

In June 2002, the FASB issued SFAS No. 146, “Accounting for Costs Associated with Exit or Disposal Activities,” which addresses financial accounting and reporting for costs associated with exit or disposal activities. The provisions of this statement are effective for exit and disposal activities that are initiated after December 31, 2002. The adoption of this statement is not expected to have a material impact on the financial position or results of operations of the Partnership.

 

In November 2002, FASB issued Interpretation No. 45, Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others (“Interpretation 45”), which addresses the disclosure to be made by a guarantor in its interim and annual financial statements about its obligations under guarantees. These disclosure requirements are included in the footnotes to the consolidated financial statements. Interpretation 45 also requires the recognition of a liability by a guarantor at the inception of certain guarantees.

 

Interpretation 45 requires the guarantor to recognize a liability for the non-contingent component of the guarantee, which is the obligation to stand ready to perform in the event that specified triggering events or conditions occur. The initial measurement of this liability is the fair value of the guarantee at inception. The recognition of the liability is required even if it is not probable that payments will be required under the guarantee or if the guarantee was issued with a premium payment or as part of a transaction with multiple elements. The Partnership has adopted the disclosure requirements of Interpretation 45 and will apply the recognition and measurement provisions for all guarantees entered into or modified after December 31, 2002.

 

In January 2003, FASB issued Interpretation 46, Consolidation of Variable Interest Entities (“Interpretation 46”), which addresses consolidation of certain variable interest entities and is effective January 31, 2003. The Partnership will review its investments in unconsolidated companies based on this new accounting pronouncement, but does not anticipate that the adoption of Interpretation 46 will have a material impact on its financial statements.

 

Item 7A.  Quantitative and Qualitative Disclosure About Market Risks

 

The Partnership is exposed to interest rate changes primarily as a result of its line of credit and long-term debt used to maintain liquidity and fund capital expenditures and expansion of the Partnership’s real estate investment portfolio and operations. The Partnership’s interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flows and to lower its overall borrowing costs. To achieve its objectives the Partnership borrows primarily at fixed rates and may enter into derivative financial instruments such as interest rate swaps, caps and treasury locks in order to mitigate its interest rate risk on a related financial instrument. The Partnership does not enter into derivative or interest rate transactions for speculative purposes.

 

The Partnership’s interest rate risk is monitored using a variety of techniques. The table below presents the principal amounts (in thousands) of the expected annual maturities, weighted average interest rates for the average debt outstanding in the specified period, fair values and other terms required to evaluate the expected cash flows and sensitivity to interest rate changes. The fair values of the Partnership’s debt instruments are calculated as the present value of estimated future cash flows using a discount rate commensurate with the risks involved.

 

26



 

 

 

2003

 

2004

 

2005

 

2006

 

2007

 

Thereafter

 

Total

 

Fair
Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed rate secured debt

 

$

83,809

 

$

38,900

 

$

13,204

 

$

52,860

 

$

19,580

 

$

51,023

 

$

259,376

 

$

278,820

 

Weighted average interest rate

 

8.32

%

7.68

%

7.19

%

7.17

%

7.63

%

5.63

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Variable rate LIBOR based secured debt

 

$

 

$

 

$

 

$

23,895

 

$

 

$

 

$

23,895

 

$

23,895

 

Rate at December 31, 2002

 

N/A

 

N/A

 

N/A

 

1.98

%

NA

 

N/A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Variable rate Treasury based secured debt

 

$

686

 

$

711

 

$

741

 

$

781

 

$

811

 

$

12,146

 

$

15,876

 

$

15,875

 

Weighted average interest rate

 

1.39

%

1.39

%

1.39

%

1.38

%

1.38

%

1.29

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unsecured notes

 

$

175,251

 

$

150,264

 

$

200,227

 

$

100,240

 

$

100,156

 

$

800,000

 

$

1,526,138

 

$

1,666,557

 

Weighted average interest rate

 

7.30

%

7.01

%

7.19

%

7.05

%

7.00

%

6.78

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unsecured lines of credit

 

$

 

$

281,000

 

$

 

$

 

$

 

$

 

$

281,000

 

$

281,000

 

Weighted average interest rate

 

N/A

 

2.07

%

N/A

 

N/A

 

N/A

 

N/A

 

 

 

 

 

 

As the table incorporates only those exposures that exist as of December 31, 2002, it does not consider those exposures or positions that could arise after that date. As a result, the Partnership’s ultimate realized gain or loss with respect to interest rate fluctuations will depend on the exposures that arise during the period, the Partnership’s hedging strategies at that time, and interest rates.

 

In December 2002, the Partnership entered into two $50 million forward-starting interest rate swaps. The fair value of the swaps was a liability of ($2.1) million as of December 31, 2002. See footnote 12 to the Consolidated Financial Statements for further information.

 

Item 8.  Financial Statements and Supplementary Data

 

The financial statements and supplementary data are included under Item 15 of this Report.

 

Item 9.  Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 

None.

 

Part III

 

Item 10.  Directors and Executive Officers of the Registrant

 

The Partnership does not have any directors or officers. The information required by Item 10 for Directors and Certain Executive Officers is contained in a definitive proxy statement of the General Partner, which was filed on March 7, 2003, and herein is incorporated by reference.

 

Item 11.  Executive Compensation

 

The information required by Item 11 is contained in a definitive proxy statement for the General Partner that was filed on March 7, 2003, and herein is incorporated by reference.

 

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Unitholder Matters

 

The information required by Item 12 is contained in a definitive proxy statement for the General Partner that was filed on March 7, 2003, and herein is incorporated by reference.

 

Item 13.  Certain Relationships and Related Transactions

 

The information required by Item 13 is contained in a definitive proxy statement for the General Partner that was filed on March 7, 2003, and herein is incorporated by reference.

 

27



 

Item 14. Disclosure Controls and Procedures

 

The Partnership maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in our annual and periodic reports filed with the SEC is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. These disclosure controls and procedures are further designed to ensure that such information is accumulated and communicated to management, including the General Partner’s chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure.

 

Based on the most recent evaluation, which was completed within 90 days of the filing of this report, the General Partner’s chief executive officer and chief financial officer believe that the Partnership’s disclosure controls and procedures are effective. There have been no significant changes in the internal controls or in other factors that could significantly affect the internal controls subsequent to the date of the completed evaluation.

 

Part IV

 

Item 15.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K

 

(a)             The following documents are filed as part of this Form 10-K:

 

1.       Consolidated Financial Statements

 

The following Consolidated Financial Statements of the Partnership, together with the Independent Auditors’ Report, are listed below:

 

Independent Auditors’ Report

Consolidated Balance Sheets, December 31, 2002 and 2001

Consolidated Statements of Operations, Years Ended December 31, 2002, 2001 and 2000

Consolidated Statements of Cash Flows, Years Ended December 31, 2002, 2001 and 2000

Consolidated Statements of Partners’ Equity, Years Ended December 31, 2002, 2001 and 2000

Notes to Consolidated Financial Statements

 

2.       Consolidated Financial Statement Schedules

 

Schedule III – Real Estate and Accumulated Depreciation

 

3.       Exhibits

 

The following exhibits are filed with this Annual Report Form 10-K or incorporated herein by reference to the listed document previously filed with the SEC. Previously unfilled documents are noted with an asterisk (*).

 

Number

 

Description

 

 

 

4.1

 

Second Amended and Restated Agreement of Limited Partnership of the Partnership, incorporated by reference to Exhibit 4.1 to the Partnership’s Current Report on Form 8-K filed on July 16, 2000.

 

 

 

4.2

 

First Amendment to Second Amended and Restated Agreement of Limited Partnership of the Partnership, incorporated by reference from Exhibit 10.2 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001.

 

 

 

4.3

 

Second Amendment to Second Amended and Restated Agreement of Limited Partnership of the Partnership, incorporated by reference to Exhibit 10.3 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.

 

28



 

4.4

 

Third Amendment To Second Amended and Restated Agreement of Limited Partnership of the Partnership, incorporated by reference to Exhibit 10.4 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.

 

 

 

4.5

 

Fourth Amendment to Second Amended and Restated Agreement of Limited Partnership of the Partnership, incorporated by reference to Exhibit 10.5 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.

 

 

 

4.6

 

Indenture between the Partnership and The First National Bank of Chicago, Trustee, incorporated by reference to Exhibit 4.1 to the General Partner’s Current Report on Form 8-K filed September 22, 1995.

 

 

 

4.7

 

First Supplement to Indenture, incorporated by reference to Exhibit 4.2 to the General Partner’s Current Report on Form 8-K filed September 22, 1995.

 

 

 

4.8

 

Second Supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed July 12, 1996.

 

 

 

4.9

 

Third Supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed May 20, 1998.

 

 

 

4.10

 

Fourth Supplement to Indenture, incorporated by reference to Exhibit 4.8 to the General Partner’s Form S-4 Registration Statement No. 333-77645 dated May 4, 2000 (Merger Registration Statement).

 

 

 

4.11

 

Fifth Supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed June 1, 1999.

 

 

 

4.12

 

Sixth Supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed February 12, 2000.

 

 

 

4.13

 

Seventh Supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed June 29, 2000.

 

 

 

4.14

 

Eighth Supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed November 15, 2000.

 

 

 

4.15

 

Ninth supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed March 2, 2002.

 

 

 

4.16

 

Tenth supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed August 13, 2002.

 

 

 

4.17

 

Eleventh supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed August 26, 2002.

 

 

 

4.18

 

Twelfth supplement to Indenture, incorporated by reference to Exhibit 4 to the Partnership’s Current Report on Form 8-K filed January 16, 2003.

 

 

 

10.1

 

Second Amended and Restated Agreement of Limited Partnership of Duke Realty Services Limited Partnership (the “Services Partnership”) incorporated herein by reference to Exhibit 10.3 to the Partnership’s Annual Report on Form 10-K for the year ended December 31, 1995.

 

29



 

10.2

 

First Amendment to Second Amended and Restated Agreement of Limited Partnership of the Services Partnership incorporated by reference to Exhibit 10.7 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.

 

 

 

10.3

 

Second Amendment to Second Amended and Restated Agreement of Limited Partnership of the Services Partnership incorporated by reference to Exhibit 10.8 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.

 

 

 

10.4

 

Third Amendment to Second Amended and Restated Agreement of Limited Partnership of the Services Partnership incorporated by reference to Exhibit 10.9 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.

 

 

 

10.5

 

Promissory Note of the Services Partnership incorporated herein by reference to Exhibit 10.3 to the Partnership’s Form S-2 Registration Statement No 33-64038 filed June 8, 1993 (the “1993 Registration Statement”).

 

 

 

10.6

 

Services Partnership 1993 Stock Option Plan incorporated herein by reference to Exhibit 10.4 to the 1993 Registration Statement.#

 

 

 

10.7

 

Amendment One to Services Partnership 1993 Stock Option Plan incorporated by reference to Exhibit 10.12 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.8

 

Amendment Two to Services Partnership 1993 Stock Option Plan incorporated by reference to Exhibit 10.13 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.9

 

Amendment Three to Services Partnership 1993 Stock Option Plan incorporated by reference to Exhibit 10.14 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.10

 

Acquisition Option Agreement relating to certain properties not contributed to the Operating Partnership by Duke Associates (the “Excluded Properties”) incorporated herein by reference to Exhibit 10.5 to the 1993 Registration Statement.

 

 

 

10.11

 

Management Agreement relating to the Excluded Properties incorporated herein by reference to Exhibit 10.6 to the 1993 Registration Statement.

 

 

 

10.12

 

Indemnification Agreement incorporated herein by reference to Exhibit 10.11 to the 1993 Registration Statement.

 

 

 

10.13

 

1995 Key Employee Stock Option Plan of the Partnership incorporated herein by reference to Exhibit 10.13 to the Partnership’s Annual Report on Form 10-K for the year ended December 31, 1995.#

 

 

 

10.14

 

Amendment One To The 1995 Key Employees’ Stock Option Plan of Duke Realty Investments, Inc. incorporated by reference to Exhibit 10.19 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.15

 

Amendment Two to the 1995 Key Employees’ Stock Option Plan of Duke Realty Investments, Inc. incorporated by reference to Exhibit 10.20 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

30



 

10.16

 

Amendment Three to the 1995 Key Employees’ Stock Option Plan of Duke Realty Investments, Inc. incorporated by reference to Exhibit 10.21 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.17

 

Amendment Four to the 1995 Key Employees’ Stock Option Plan of Duke Realty Investments, Inc. incorporated by reference to Exhibit 10.22 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.18

 

Amendment Five to the 1995 Key Employees’ Stock Option Plan of Duke Realty Investments, Inc. incorporated by reference to Exhibit 10.23 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.19

 

Amendment Six to the 1995 Key Employees’ Stock Option Plan of Duke Realty Investments, Inc. incorporated by reference to Exhibit 10.24 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.20

 

Amended and Restated Dividend Increase Unit Plan of the Services Partnership. incorporated by reference to Exhibit 10.25 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.21

 

Amendment One to the Amended and Restated Dividend Increase Unit Plan of Services Partnership incorporated by reference to Exhibit 10.26 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.22

 

Amendment Two to the Amended and Restated Dividend Increase Unit Plan of Services Partnership incorporated by reference to Exhibit 10.27 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.23

 

1995 Shareholder Value Plan of the Services Partnership incorporated herein by reference to Exhibit 10.15 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 1995.#

 

 

 

10.24

 

Amendment One to the 1995 Shareholder Value Plan of Services Partnership incorporated by reference to Exhibit 10.29 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.25

 

Amendment Two to the 1995 Shareholder Value Plan of Services Partnership incorporated by reference to Exhibit 10.30 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.26

 

Amendment Three to the 1995 Shareholder Value Plan of Services Partnership incorporated by reference to Exhibit 10.31 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.#

 

 

 

10.27

 

1999 Duke Realty Severance Pay Plan incorporated herein by reference to Exhibit 10.18 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 1999.#

 

 

 

10.28

 

2000 Directors’ Stock Option and Dividend Increase Unit Plan incorporated by reference to Annex F to the Prospectus in the Merger Registration Statement.#

 

 

 

10.29

 

2000 Salary Replacement Stock Option and Dividend Increase Unit Plan is incorporated by reference to Annex G to the Prospectus in the Merger Registration Statement.#

 

31



 

10.30

 

Third Amended and Restated Revolving Credit Agreement dated February 28, 2002, among the Partnership as borrower, the General Partner as General Partner and Guarantor and Bank One as Administrative Agent and Lender incorporated by reference to Exhibit 10.35 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.

 

 

 

10.31

 

Revolving Credit Agreement dated July 9, 2002, among the Partnership as borrower, the General Partner as General Partner an Bank One as Administrative Agent and Lender incorporated by reference to Exhibit 10.23 to the General Partner’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002.

 

 

 

11.1

 

Statement of Computation of Ratios of Earnings to Fixed Charges.*

 

 

 

11.2

 

Statement of Computation of Ratios of Earnings to Debt Service.*

 

 

 

21.

 

List of the Partnership’s Subsidiaries.*

 

 

 

23.

 

Consent of KPMG LLP.*

 

 

 

24.

 

Executed powers of attorney of certain directors.*

 

 

 

99.1

 

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

 

 

 

99.2

 

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

 

 

 

99.3

 

Selected Quarterly Financial Information.*

 


# Represents management contract or compensatory plan or arrangement.

 

The Partnership will furnish to any security holder, upon written request, copies of any exhibit incorporated by reference, for a fee of 15 cents per page, to cover the costs of furnishing the exhibits. Written request

 

should include a representation that the person making the request was the beneficial owner of securities entitled to vote at the Annual Meeting of Shareholders of the General Partner.

 

(b)                                  Reports on Form 8-K

 

None

 

(c)                                  Exhibits

 

The exhibits required to be filed with this Annual Report Form 10-K pursuant to Item 601 of Regulation S-K or listed under “Exhibits” in Part IV, Item 14(a)(3) of Form 10-K, which are incorporated herein by reference.

 

(d)           Financial Statement Schedule

 

The Financial Statement Schedule required to be filed with this Annual Report Form 10-K is listed under “Consolidated Financial Statement Schedules” in Part IV, Item 14(a)(2) of this Form 10-K, and is incorporated herein by reference.

 

32



 

Independent Auditors’ Report

 

The Partners

Duke Realty Limited Partnership:

 

We have audited the consolidated balance sheets of Duke Realty Limited Partnership and Subsidiaries as of December 31, 2002 and 2001, and the related consolidated statements of operations, cash flows and partners’ equity for each of the years in the three-year period ended December 31, 2002. In connection with our audits of the consolidated financial statements, we also have audited the financial statement schedule III. These consolidated financial statements and the financial statement schedule are the responsibility of the Partnership’s management. Our responsibility is to express an opinion on the consolidated financial statements and the financial statement schedule based on our audits.

 

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

 

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Duke Realty Limited Partnership and Subsidiaries as of December 31, 2002 and 2001, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2002, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the related financial statement schedule III, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

 

 

KPMG LLP

Indianapolis, Indiana

January 29, 2003

 

33



 

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in thousands)

 

 

 

December 31,
2002

 

December 31,
2001

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

Real estate investments:

 

 

 

 

 

Land and improvements

 

$

608,995

 

$

583,909

 

Buildings and tenant improvements

 

4,237,360

 

4,068,944

 

Construction in progress

 

85,756

 

154,086

 

Investments in unconsolidated companies

 

315,589

 

323,682

 

Land held for development

 

326,250

 

322,528

 

 

 

5,573,950

 

5,453,149

 

Accumulated depreciation

 

(555,858

)

(425,721

)

 

 

 

 

 

 

Net real estate investments

 

5,018,092

 

5,027,428

 

 

 

 

 

 

 

Cash and cash equivalents

 

17,129

 

10,453

 

Accounts receivable, net of allowance of $2,008 and $2,820

 

15,415

 

23,142

 

Straight-line rent receivable, net of allowance of  $2,491 and $841

 

52,062

 

42,751

 

Receivables on construction contracts

 

23,181

 

30,077

 

Deferred financing costs, net of accumulated amortization of $15,390 and $17,459

 

11,431

 

12,489

 

Deferred leasing and other costs, net of accumulated amortization of $50,543 and $41,284

 

112,772

 

97,117

 

Escrow deposits and other assets

 

96,973

 

86,789

 

 

 

$

5,347,055

 

$

5,330,246

 

LIABILITIES AND PARTNERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

Indebtedness:

 

 

 

 

 

Secured debt

 

$

299,147

 

$

318,484

 

Unsecured notes

 

1,526,138

 

1,376,372

 

Unsecured lines of credit

 

281,000

 

120,000

 

 

 

2,106,285

 

1,814,856

 

 

 

 

 

 

 

Construction payables and amounts due subcontractors

 

43,232

 

54,735

 

Accounts payable

 

548

 

2,274

 

Accrued expenses:

 

 

 

 

 

Real estate taxes

 

51,472

 

51,462

 

Interest

 

27,374

 

24,313

 

Other

 

52,485

 

48,678

 

Other liabilities

 

106,893

 

117,577

 

Tenant security deposits and prepaid rents

 

33,710

 

34,644

 

Total liabilities

 

2,421,999

 

2,148,539

 

 

 

 

 

 

 

Minority interest

 

5,213

 

5,475

 

 

 

 

 

 

 

Partners’ equity:

 

 

 

 

 

General Partner

 

 

 

 

 

Common equity

 

2,203,060

 

2,203,291

 

Preferred equity (liquidation preference of $440,889)

 

415,466

 

583,419

 

 

 

2,618,526

 

2,786,710

 

Limited partners’ common equity

 

235,473

 

286,759

 

Limited partners’ preferred equity

 

67,955

 

102,955

 

Accumulated other comprehensive income

 

(2,111

)

(192

)

 

 

2,919,843

 

3,176,232

 

 

 

$

5,347,055

 

$

5,330,246

 

 

See accompanying Notes to Consolidated Financial Statements.

 

34



 

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Statements of Operations

For the Years Ended December 31

(in thousands, except per unit amounts)

 

 

 

2002

 

2001

 

2000

 

RENTAL OPERATIONS:

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

Rental income

 

$

684,346

 

$

683,348

 

$

692,191

 

Equity in earnings of unconsolidated companies

 

27,180

 

31,391

 

14,556

 

 

 

711,526

 

714,739

 

706,747

 

Operating expenses:

 

 

 

 

 

 

 

Rental expenses

 

127,045

 

120,839

 

117,798

 

Real estate taxes

 

73,392

 

70,415

 

70,894

 

Interest expense

 

117,073

 

111,880

 

131,418

 

Depreciation and amortization

 

174,902

 

157,502

 

161,454

 

 

 

492,142

 

460,636

 

481,564

 

 

 

 

 

 

 

 

 

Earnings from rental operations

 

219,114

 

254,103

 

225,183

 

 

 

 

 

 

 

 

 

SERVICE OPERATIONS:

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

General contractor gross revenue

 

194,439

 

264,455

 

292,661

 

General contractor costs

 

(172,559

)

(229,845

)

(253,763

)

 

 

 

 

 

 

 

 

Net general contractor revenue

 

21,880

 

34,610

 

38,898

 

 

 

 

 

 

 

 

 

Property management, maintenance and leasing fees

 

14,301

 

22,824

 

25,477

 

Construction management and development activity income

 

29,428

 

19,142

 

16,965

 

Other income

 

2,011

 

3,883

 

1,459

 

 

 

 

 

 

 

 

 

Total revenue

 

67,620

 

80,459

 

82,799

 

 

 

 

 

 

 

 

 

Operating expenses

 

38,100

 

45,344

 

50,039

 

 

 

 

 

 

 

 

 

Earnings from service operations

 

29,520

 

35,115

 

32,760

 

 

 

 

 

 

 

 

 

General and administrative expense

 

(24,735

)

(15,553

)

(21,137

)

 

 

 

 

 

 

 

 

Operating income

 

223,899

 

273,665

 

236,806

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE):

 

 

 

 

 

 

 

Interest income

 

3,849

 

5,308

 

6,866

 

Earnings from land and depreciated property dispositions, net of impairment adjustment

 

(410

)

45,708

 

60,692

 

Other expense

 

182

 

(2,582

)

(963

)

Minority interest in earnings of subsidiaries

 

(1,093

)

(2,411

)

(2,145

)

 

 

226,427

 

319,688

 

301,256

 

Discontinued operations:

 

 

 

 

 

 

 

Net income from discontinued operations

 

3,199

 

3,592

 

1,162

 

Gain on sale of discontinued operations

 

2,733

 

 

 

Income from discontinued operations

 

5,932

 

3,592

 

1,162

 

Net income

 

232,359

 

323,280

 

302,418

 

Dividends on preferred units

 

(52,613

)

(60,850

)

(57,389

)

 

 

 

 

 

 

 

 

Net income available for common unitholders

 

$

179,746

 

$

262,430

 

$

245,029

 

 

 

 

 

 

 

 

 

Basic net income per common unit:

 

 

 

 

 

 

 

Continuing operations

 

$

1.16

 

$

1.75

 

$

1.67

 

Discontinued operations

 

.04

 

.02

 

.01

 

Total

 

$

1.20

 

$

1.77

 

$

1.68

 

Diluted net income per common unit:

 

 

 

 

 

 

 

Continuing operations

 

$

1.15

 

$

1.73

 

$

1.65

 

Discontinued operations

 

.04

 

.02

 

.01

 

Total

 

$

1.19

 

$

1.75

 

$

1.66

 

Discontinued operations

 

 

 

 

 

 

 

Weighted average number of common units outstanding

 

149,423

 

147,961

 

145,906

 

Weighted average number of common and dilutive potential common units

 

150,839

 

151,710

 

147,441

 

 

See accompanying Notes to Consolidated Financial Statements.

 

35



 

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the Years Ended December 31

(in thousands)

 

 

 

2002

 

2001

 

2000

 

 

 

 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

 

 

 

Net income

 

$

232,359

 

$

323,280

 

$

302,418

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

Depreciation of buildings and tenant improvements

 

154,565

 

138,723

 

143,800

 

Amortization of deferred leasing and other costs

 

21,056

 

20,991

 

18,723

 

Amortization of deferred financing costs

 

3,725

 

4,589

 

3,527

 

Minority interest in earnings

 

1,093

 

2,411

 

2,145

 

Straight-line rent adjustment

 

(12,500

)

(12, 593

)

(14,519

)

Earnings (loss) from land and depreciated property sales

 

(1,048

)

(45,708

)

(60,692

)

Build-to-suit operations, net

 

168,199

 

(79,912

)

(88,178

)

Construction contracts, net

 

(11,656

)

9,651

 

3,252

 

Other accrued revenues and expenses, net

 

8,605

 

(10,908

)

55,645

 

Operating distributions received in excess of equity and earnings from unconsolidated companies

 

4,575

 

(1,844

)

(2,511

)

Net cash provided by operating activities

 

568,973

 

348,680

 

363,610

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Development of real estate investments

 

(158,131

)

(251,405

)

(306,347

)

Acquisition of real estate investments

 

(98,062

)

(13,927

)

(5,932

)

Acquisition of land held for development and infrastructure costs

 

(27,182

)

(92,203

)

(99,470

)

Recurring tenant improvements

 

(28,011

)

(18,416

)

(31,955

)

Recurring leasing costs

 

(17,975

)

(13,845

)

(17,530

)

Recurring building improvements

 

(13,373

)

(10,873

)

(6,804

)

Other deferred leasing costs

 

(18,219

)

(10,621

)

(39,018

)

Other deferred costs and other assets

 

(17,350

)

3,223

 

(12,042

)

Tax deferred exchange escrow, net

 

 

27,260

 

(16,207

)

Proceeds from land and depreciated property sales, net

 

52,186

 

436,113

 

413,752

 

Capital distributions from unconsolidated companies

 

 

59,249

 

158,351

 

Advances to unconsolidated companies

 

(11,130

)

(21,067

)

(48,770

)

Net cash provide by (used by) investing activities

 

(337,247

)

93,488

 

(11,972

)

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

Contribution from General Partner

 

22,651

 

108,693

 

29,966

 

Proceeds from indebtedness

 

200,000

 

175,000

 

 

Payment for redemption of preferred equity

 

(167,953

)

(75,018

)

 

Payments for redemption of preferred units

 

(35,000

)

 

 

Payments on indebtedness including principal amortization

 

(71,953

)

(223,578

)

(75,689

)

Borrowings (payments) on lines of credit, net

 

157,305

 

(125,067

)

14,658

 

Distributions to partners

 

(271,659

)

(262,236

)

(239,250

)

Distributions to preferred unitholders

 

(54,613

)

(61,418

)

(57,389

)

Distributions to minority interest

 

(565

)

(2,024

)

(1,888

)

Deferred financing costs

 

(3,263

)

(5,267

)

(1,360

)

Net cash provided by (used for)  financing activities

 

(225,050

)

(470,915

)

(330,952

)

 

 

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

6,676

 

(28,747

)

20,686

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at beginning of year

 

10,453

 

39,200

 

18,514

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at end of year

 

$

17,129

 

$

10,453

 

$

39,200

 

 

 

 

 

 

 

 

 

Other non-cash items:

 

 

 

 

 

 

 

Assumption of debt for real estate acquisitions

 

$

9,566

 

$

16,403

 

$

 

Contributions of property to unconsolidated companies

 

$

 

$

4,501

 

$

245,502

 

Conversion of Limited Partner Units to common shares of General Partner

 

$

13,226

 

$

4,259

 

$

1,317

 

Issuance of Limited Partner Units for real estate acquisitions

 

$

4,686

 

$

3,787

 

$

7,615

 

Transfer of debt in sale of depreciated property

 

$

2,432

 

$

16,000

 

$

72,650

 

Redemption of Limited Partner Units for sale of depreciated property

 

$

 

$

13,445

 

$

 

Impairment adjustments on depreciable property

 

$

9,400

 

$

4,800

 

$

540

 

Acquisition of partners’ interest in unconsolidated companies

 

$

12,149

 

$

18,049

 

$

 

 

See accompanying Notes to Consolidated Financial Statements.

 

36



 

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

Consolidated Statements of Partners’ Equity

(in thousands, except for per unit amounts)

 

 

 

 

 

 

 

Limited
Partners’
Common
Equity

 

Limited
Partners’
Preferred
Equity

 

Accumulated
Other
Comprehensive
Income (Loss)

 

Total

 

 

 

 

General Partner

Common
Equity

 

Preferred
Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 1999

 

2,082,720

 

587,385

 

328,929

 

102,955

 

 

3,101,989

 

Net income

 

212,958

 

48,981

 

32,071

 

8,408

 

 

302,418

 

Capital contribution from General Partner

 

32,022

 

(1,124

)

 

 

 

30,898

 

Acquisition of partnership interest for common stock of General Partner

 

8,347

 

 

(7,030

)

 

 

1,317

 

Acquisition of property in exchange for Limited Partner Units

 

 

 

7,615

 

 

 

7,615

 

Distributions to preferred unitholders

 

 

(48,981

)

 

(8,408

)

 

(57,389

)

Distributions to partners ($1.64 per Common Unit)

 

(207,909

)

 

(31,341

)

 

 

(239,250

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2000

 

2,128,138

 

586,261

 

330,244

 

102,955

 

 

3,147,598

 

Comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

229,399

 

53,010

 

32,463

 

8,408

 

 

323,280

 

Distributions to preferred unitholders

 

 

(53,010

)

 

(8,408

)

 

(61,418

)

Transition adjustment resulting from adoption of FASB No. 133

 

 

 

 

 

398

 

398

 

Gains (losses) on derivative instruments

 

 

 

 

 

(1,138

)

(1,138

)

Settlement of derivative instrument

 

 

 

 

 

548

 

548

 

Comprehensive income available for common unitholders

 

 

 

 

 

 

 

 

 

 

 

261,670

 

Capital contribution from General Partner

 

37,845

 

72,210

 

 

 

 

110,055

 

Acquisition of partnership interest for common stock of General Partner

 

36,351

 

 

(32,092

)

 

 

4,259

 

Acquisition of partnership interest for real estate investments

 

 

 

(13,445

)

 

 

(13,445

)

Acquisition of property in exchange for Limited Partner Units

 

 

 

3,787

 

 

 

3,787

 

General Partner’s redemption of Series A Preferred stock

 

 

(75,018

)

 

 

 

(75,018

)

Conversion of Series D Preferred equity to common units

 

34

 

(34

)

 

 

 

 

Retirement of common units

 

(437

)

 

 

 

 

(437

)

Distributions to partners ($1.76 per Common Unit)

 

(228,039

)

 

(34,198

)

 

 

(262,237

)

Balance at December 31, 2001

 

$

2,203,291

 

$

583,419

 

$

286,759

 

$

102,955

 

$

(192

)

$

3,176,232

 

Comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

159,178

 

47,053

 

18,568

 

7,560

 

 

232,359

 

Distributions to preferred unitholders

 

 

(47,053

)

 

(7,560

)

 

(54,613

)

Gains (losses) on derivative instruments

 

 

 

 

 

(1,919

)

(1,919

)

Comprehensive income available for common unitholders

 

 

 

 

 

 

 

 

 

 

 

175,827

 

Capital contribution from General Partner

 

22,651

 

 

 

 

 

22 651

 

Acquisition of partnership interest for common stock of General Partner

 

60,509

 

 

(47,283

)

 

 

13,226

 

Acquisition of property in exchange for Limited Partner Units

 

 

 

5,439

 

 

 

5,439

 

General Partner’s redemption of Series D Preferred stock

 

 

(25

)

 

 

 

(25

)

General Partner’s redemption of Series B Preferred stock

 

 

(17,928

)

 

 

 

(17,928

)

General Partner’s redemption of Series F Preferred stock

 

 

(150,000

)

 

 

 

(150,000

)

Redemption of Series G Preferred units

 

 

 

 

(35,000

)

 

(35,000

)

Tax benefits from Employee Stock Plans

 

856

 

 

 

 

 

856

 

FASB 123 Compensation Expense

 

224

 

 

 

 

 

224

 

Distributions to General Partner

 

(1,174

)

 

 

 

 

(1,174

)

Distributions to partners ($1.81 per Common Unit)

 

(242,475

)

 

(28,010

)

 

 

(270,485

)

Balance at December 31, 2002

 

$

2,203,060

 

$

415,466

 

$

235,473

 

$

67,955

 

$

(2,111

)

$

2,919,843

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Units outstanding at December 31, 2002

 

135,007

 

 

 

14,900

 

 

 

 

 

149,907

 

 

See accompanying Notes to Consolidated Financial Statements.

 

37



 

DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES

 

Notes to Consolidated Financial Statements

(1)             The Partnership

 

Duke Realty Limited Partnership (the “Partnership”) was formed on October 4, 1993, when Duke Realty Corporation (the “General Partner”) contributed all of its properties and related assets and liabilities, along with the net proceeds of $309.2 million from the issuance of an additional 14,000,833 shares of the General Partner through an offering, to the Partnership. Simultaneously, the Partnership completed the acquisition of Duke Associates, a full-service commercial real estate firm operating in the Midwest. The General Partner was formed in 1985 and qualifies as a Real Estate Investment Trust (“REIT”) under provisions of the Internal Revenue Code.  The General Partner is the sole general partner of the Partnership, owning 90.1% of the partnership interest as of December 31, 2002 (“General Partner Units”). The remaining 9.9% of the Partnership is owned by limited partners (“Limited Partner Units” and, together with the General Partner Units, the “Common Units”). The Limited Partner Units are exchangeable for shares of the General Partner’s common stock on a one-for-one basis subject generally to a one-year holding period.

 

The Partnership owns and operates a portfolio of industrial, office and retail properties in the midwestern and southeastern United States and provides real estate services to third-party owners. The Partnership conducts Service Operations through Duke Realty Services Limited Partnership (“DRSLP”) and Duke Construction Limited Partnership (“DCLP”). The consolidated financial statements include the accounts of the Partnership and its majority-owned or controlled subsidiaries.

 

(2)             Summary of Significant Accounting Policies

 

Principles of Consolidation

 

The consolidated financial statements include the accounts of the Partnership and its majority-owned or controlled subsidiaries. The equity interests in these majority-owned or controlled subsidiaries not owned by the Partnership are reflected as minority interests in the consolidated financial statements. All significant intercompany balances and transactions have been eliminated in the consolidated financial statements. Investments in entities that the Partnership does not control through majority voting interest or where the other owner has substantial participating rights are not consolidated and are reflected as investments in unconsolidated companies.

 

Reclassifications

 

Certain 2000 and 2001 balances have been reclassified to conform to 2002 presentation.

 

Real Estate Investments

 

Real estate investments to be held for rental are stated at the lower of cost less accumulated depreciation or fair value if impairment is identified. Real estate investments to be disposed of are reported at the lower of their carrying amount or fair value less cost to sell. Buildings and land improvements are depreciated on the straight-line method over their estimated life not to exceed 40 and 15 years, respectively, and tenant improvement costs are depreciated on the straight-line method over the term of the related lease.

 

Direct and indirect costs, including interest and real estate taxes associated with the development, construction, leasing or expansion of real estate investments are capitalized as a cost of the property.  Included in indirect costs is an estimate of internal costs associated with development and leasing of real estate investments. All external costs associated with the acquisition of real estate investments are capitalized as a cost of the property.

 

38



 

Upon the acquisition of rental property, the Partnership evaluates all in-place tenant lease agreements to determine if the leases are at, below or above market rates. If a lease is determined to be above or below market, a corresponding asset or liability is recorded and amortized into income over the life of the lease. At the time of acquisition, a deferred lease commission asset is also recorded and amortized over the lease’s remaining life.

 

The Partnership evaluates its real estate investments to be held and used upon occurrence of significant changes in the operations, but not less than annually, to assess whether any impairment indications are present, including recurring operating losses and significant adverse changes in legal factors or business climate that affect the recovery of the recorded value. If any real estate investment is considered impaired, a loss is provided to reduce the carrying value of the property to its estimated fair value.

 

Acquisitions of the Partnership’s interests are recorded under the purchase method with assets acquired reflected at the fair market value of the General Partner’s common stock on the date of acquisition, net of the retirement of any minority interest liabilities. The acquisition amounts are allocated to Partnership assets based on their estimated fair values.

 

The Partnership has equity interests in unconsolidated partnerships and joint ventures which own and operate rental properties and hold land for development. The equity method of accounting is used for these investments in which the Partnership has the ability to exercise significant influence, but not control, over operating and financial policies. Any difference between the carrying amount of these investments and the underlying equity in net assets is amortized to equity in earnings of unconsolidated companies over the depreciable life of the property, generally 40 years.

 

Cash Equivalents

 

Highly liquid investments with a maturity of three months or less when purchased are classified as cash equivalents.

 

Deferred Costs

 

Costs incurred in connection with obtaining financing are amortized to interest expense on the straight-line method over the term of the related loan. All direct and indirect costs, including estimated internal costs, associated with the rental of real estate investments owned by the Partnership are capitalized and amortized over the term of the related lease. Unamortized costs are charged to expense upon the early termination of the lease or upon early payment of the financing.

 

Revenues

 

Rental Operations

 

Rental income from leases with scheduled rental increases during their terms is recognized on a straight-line basis.

 

Service Operations

 

Management fees are based on a percentage of rental receipts of properties managed and are recognized as the rental receipts are collected. Maintenance fees are based upon established hourly rates and are recognized as the services are performed. Construction management and development fees for third party contracts are recognized as earned based on the terms of the contract, which approximate the percentage of completion method.

 

39



 

The Partnership recognizes income on long-term construction contracts where the Partnership serves as a general contractor on the percentage of completion method. Using this method, profits are recorded on the basis of the Partnership’s estimates of the percentage of completion of individual contracts, commencing when progress reaches a point where experience is sufficient to estimate final results with reasonable accuracy. That portion of the estimated earnings is accrued on the basis of the Partnership’s estimates of the percentage of completion based on contract expenditures incurred and work performed.

 

Property Sales

 

Gains from sales of depreciated property are recognized in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 66, and are included in earnings from sales of land and depreciable property dispositions, net of impairment adjustment, in the Statement of Operations if identified as held for sale prior to adoption of SFAS 144 and in discontinued operations if identified as held for sale after adoption of SFAS 144.

 

Gains or losses from the sale of property which is considered held for sale in DCLP are recognized in accordance with SFAS 66 and are included in construction management and development activity income in the Statement of Operations.

 

Net Income Per Common Unit

 

Basic net income per common unit is computed by dividing net income available for common units by the weighted average number of common units outstanding for the period. Diluted net income per common unit is computed by dividing the sum of net income available for common units by the sum of the weighted average number of common units outstanding and dilutive potential common units for the period.

 

The following table reconciles the components of basic and diluted net income per unit (in thousands):

 

 

 

2002

 

2001

 

2000

 

Basic net income available for common unitholders

 

$

179,746

 

$

262,430

 

$

245,029

 

Joint venture partner convertible ownership net income

 

 

3,423

 

 

Diluted net income available for common unitholders and dilutive potential common units

 

$

179,746

 

$

265,853

 

$

245,029

 

 

 

 

 

 

 

 

 

Weighted average number of common units outstanding

 

149,423

 

147,961

 

145,906

 

Joint venture partner convertible ownership common unit equivalents

 

 

2,092

 

 

Dilutive units for stock-based compensation plans

 

1,416

 

1,657

 

1,535

 

Weighted average number of common units and dilutive potential common units

 

150,839

 

151,710

 

147,441

 

 

The Series D Convertible Preferred equity and the Series G Convertible Preferred limited partner units were anti-dilutive for the years ended December 31, 2002, 2001 and 2000; therefore, no conversion to common units is included in weighted dilutive potential common units. In September 2002, the Partnership redeemed the Series G Convertible Preferred units at their par value of $35.0 million.

 

A joint venture partner in one of the Partnership’s unconsolidated companies has the option to convert a portion of its ownership to the General Partner’s common shares (see discussion in Investments in Unconsolidated Companies section). The effect of the option on earnings per unit was dilutive for the year ended December 31, 2002; therefore, conversion to common units is included in weighted dilutive potential common units.

 

40



 

Federal Income Taxes

 

As a partnership, the allocated share of income and loss for the year is included in the income tax returns of the partners; accordingly, no accounting for income taxes is required in the accompanying consolidated financial statements.

 

Stock Based Compensation

 

For all issuances prior to 2002, the Partnership applies the recognition and measurement provisions of APB Opinion No. 25, Accounting for Stock Issued to Employees, and related Interpretations in accounting for these plans. For stock options granted prior to 2002, no compensation expense is reflected in net income as all options granted had an exercise price equal to the market value of the underlying common stock of the General Partner’s on the date of the grant.

 

Effective January 1, 2002, the Partnership prospectively adopted the fair value recognition provisions of FASB Statement No. 123, Accounting for Stock-Based Compensation, to all awards granted after January 1, 2002.

 

Fair Value Of Financial Instruments

 

The fair values of the Partnership’s financial instruments, other than derivative financial instruments, are generally calculated as the present value of estimated future cash flows using a discount rate commensurate with the risks involved. The fair value approximates the carrying value for all financial instruments except indebtedness, which is discussed in Footnote 6 to the Consolidated Financial Statements.

 

Derivative Financial Instruments

 

The Partnership adopted SFAS No. 133 “Accounting for Derivative Instruments and Hedging Activities” as amended (“SFAS 133”), on January 1, 2001. SFAS 133 requires that all derivative instruments be recorded on the balance sheet at their fair value. Gains or losses resulting from changes in the values of those derivatives would be accounted for depending on the use of the derivative and whether it qualifies for hedge accounting. The Partnership uses derivative financial instruments such as interest rate swaps to mitigate its interest rate risk on a related financial instrument. SFAS 133 requires that changes in fair value of derivatives that qualify as cash flow hedges be recognized in other comprehensive income while the ineffective portion of the derivative’s change in fair value be recognized immediately in earnings.

 

To determine the fair value of derivative instruments, the Partnership uses standard market conventions and techniques such as discounted cash flow analysis, option pricing models and termination cost at each balance sheet date. All methods of assessing fair value result in a general approximation of value, and such value may never actually be realized.

 

Use Of Estimates

 

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

 

(3)             Related Party Transactions

 

The Partnership provides property management, leasing, construction and other tenant related services to properties in which certain executives have ownership interests. The Partnership has an option to acquire these executive officers’ interests in these properties (the “Option Properties”). The Partnership received

 

41



 

fees totaling $1.4 million, $1.7 million and $1.9 million in 2002, 2001 and 2000, respectively, for services provided to the Option Properties. The fees charged by the Partnership for such services are equivalent to those charged to third-party owners for similar services.

 

On June 27, 2001, A. Ray Weeks, Jr. resigned his position as a director and Vice Chairman of the General Partner. On August 17, 2001, the Partnership redeemed 620,156 common units beneficially owned by Mr. Weeks and certain members of his immediate and extended family (the “Weeks Affiliates”). The deemed value of the units redeemed was $15.7 million, which was based on the average closing stock price of the General Partner’s common stock for a certain period of days preceding the redemption date. As consideration for the redemption, the Weeks Affiliates received a distribution of seven industrial rental properties and one undeveloped tract of land located in the Atlanta, Georgia metropolitan area with a value of $31.7 million.  The Weeks Affiliates also assumed a loan in the amount of $16 million from Wachovia Bank, N.A. to the Partnership. The value of the properties distributed to the Weeks Affiliates was based on negotiations between Mr. Weeks and members of the General Partner’s executive committee, and was approved by the unaffiliated members of the General Partner’s Board of Directors.

 

In 2002, the Partnership received lease termination fees totaling $7.7 million from a tenant that is a subsidiary of Progress Energy. William Cavanaugh III is President and Chief Executive Officer of Progress Energy and a member of the General Partner’s Board of Directors. The General Partner’s independent directors approved the transaction and management believes that the amount received approximates a value that would have been charged to tenants with similar lease terms and commitments.

 

The Partnership has other related party transactions that are insignificant and terms are considered to be at arm’s-length and equal to those negotiated with independent parties.

 

(4)             Investments in Unconsolidated Companies

 

The Partnership has equity interests ranging from 10 – 64% in unconsolidated partnerships and joint ventures that own and operate rental properties and hold land for development. The equity method of accounting is used for these investments in which the Partnership has the ability to exercise significant influence, but not control, over operating and financial policies. Any difference between the carrying amount of these investments and the underlying equity in net assets is amortized to equity in earnings of unconsolidated companies over the depreciable life of the property, generally 40 years.

 

Combined summarized financial information for the investments in unconsolidated companies as of December 31, 2002 and 2001, and for the years ended December 31, 2002, 2001, and 2000, are as follows (in thousands):

 

 

 

2002

 

2001

 

2000

 

 

 

 

 

 

 

 

 

Land, buildings and tenant improvements, net

 

$

1,232,026

 

$

1,261,490

 

 

 

Land held for development

 

38,848

 

41,962

 

 

 

Other assets

 

67,590

 

62,017

 

 

 

 

 

$

1,338,464

 

$

1,365,469

 

 

 

 

 

 

 

 

 

 

 

Property indebtedness

 

$

579,893

 

$

581,477

 

 

 

Other liabilities

 

52,057

 

60,609

 

 

 

 

 

631,950

 

642,086

 

 

 

Owners’ equity

 

706,514

 

723,383

 

 

 

 

 

$

1,338,464

 

$

1,365,469

 

 

 

 

 

 

 

 

 

 

 

Rental income

 

$

169,683

 

$

172,257

 

$

92,082

 

 

 

 

 

 

 

 

 

Net income

 

$

51,013

 

$

58,091

 

$

32,054

 

 

42



 

The following significant transactions involving unconsolidated companies in which the Partnership has an equity interest have occurred over the past three years:

 

In 2002, the Partnership recognized a gain of $1.8 million on the sale of a “Build-to-Suit” building out of a joint venture in which the Partnership owned a 50% interest. The gain is recorded in equity in earnings in the Statement of Operations. In addition to this sale, the Partnership received approximately $29.2 million of earnings distributions from its various joint ventures.

 

Also in 2002, the Partnership bought out its other partners’ interest in six separate joint ventures. The Partnership had a 50% interest in each of these ventures prior to their acquisition.

 

In 2001, the Partnership received approximately $50.0 million in cash distributions resulting from secured debt financing within two joint ventures. The Partnership has a 50% interest in both ventures. The debt is entirely collateralized by rental properties within the ventures and the Partnership is not a guarantor on the debt.

 

Also in 2001, the Partnership recognized a gain of $2.9 million from the sale of a building out of a joint venture in which the Partnership owned a 50% interest. The gain is recorded in equity in earnings in the Statement of Operations.

 

In October 2000, the Partnership sold or contributed industrial properties and undeveloped land with a fair value of $487 million to a joint venture (Dugan Realty LLC) in which the Partnership has a 50% interest and recognized a net gain of $35.2 million. This transaction expanded an existing joint venture with an institutional real estate investor. As a result of the total transactions, the Partnership received $363.9 million of proceeds. The joint venture financed this transaction with $350 million of secured mortgage debt of which the Partnership has guaranteed $90 million and agreed to provide additional capital contributions to pay all sums due under the remaining $260 million. At December 31, 2002, this $350 million of debt is collateralized by rental properties with net carrying value substantially in excess of the outstanding debt. If required to make additional capital contributions, the Partnership will receive proportionately increased ownership in the respective collateralized properties. The Partnership does not anticipate that it will be required to satisfy the guarantee or additional capital contribution obligations. In connection with this transaction, the joint venture partners were given an option to put up to $50 million interest in the joint venture to the Partnership in exchange for common stock of the General Partner or cash, subject to timing and other restrictions. As a result of this put option, the Partnership deferred $10.2 million of gain on sale of depreciated property and recorded a $50 million liability. At December 31, 2002, the joint venture owns 130 buildings totaling approximately 23 million square feet with a net book value of approximately $760 million. The Partnership provides real estate related services to the venture through its Service Operations.

 

In December 2000, the Partnership contributed 14 industrial properties, including five under development, totaling approximately three million square feet to a joint venture (Dugan Texas LLC) in which the Partnership has a 50% interest. The Partnership also contributed 145 acres of undeveloped land. The Partnership received $33.1 million of proceeds and recorded a net gain of $686,000 as a result of the transaction. At December 31, 2002, the joint venture owns 32 buildings totaling approximately 6 million square feet with a value of approximately $224 million. The Partnership provides real estate related services to the venture through its Service Operations.

 

(5)             Real Estate Investments

 

The Partnership adopted Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long Lived Assets”(“SFAS 144”), on January 1, 2002. SFAS 144 requires the

 

43



 

Partnership to report in discontinued operations the results of operations of a property which has either been disposed or is classified as held for sale, unless certain conditions are met.

The Partnership has classified operations of nine buildings as discontinued operations in accordance with SFAS 144. As a result, the Partnership classified net income of $3.1 million, $3.6 million and $1.2 million as net income from discontinued operations for the year ended December 31, 2002, 2001 and 2000. In addition, two of the properties were sold during 2002 that were identified as held for sale post adoption of SFAS 144; therefore, the gains on disposal for these two properties of $2.7 million are also reported in discontinued operations.

 

At December 31, 2002, the Partnership had 3 industrial, 6 office and 6 retail properties comprising approximately 1.1 million square feet held for sale. Of these properties, 3 build-to-suit office and 3 build-to-suit retail properties were under development. Net operating income (defined as total property revenues, less property expenses, which include real estate taxes, repairs and maintenance, property management, utilities, insurance and other expenses) of the properties held for sale for the years ended December 31, 2002, 2001 and 2000 is approximately $4.3 million, $3.2 million, and $1.1 million, respectively. Net book value of the properties held for sale at December 31, 2002, is approximately $57.1 million. There can be no assurance that such properties held for sale will be sold.

 

In association with the Partnership’s assessment of its properties under SFAS 144, six of its 910 properties were identified as having impairment in 2002. The Partnership recorded a $9.4 million impairment adjustment associated with these properties in 2002. The Partnership has analyzed each of its in-service properties and has determined that there are no additional valuation adjustments that need to be made at December 31, 2002. In 2001, the Partnership recorded a $4.8 million impairment adjustment on a single property that was sold in 2002.

 

(6)             Indebtedness

 

Indebtedness at December 31, 2002 and 2002, consisted of the following (in thousands):

 

 

 

2002

 

2001

 

Fixed rate secured debt, weighted average interest rate of 7.35% at December 31, 2002, and 7.79% at December 31, 2001, maturity dates ranging from 2003  to 2017

 

$

259,376

 

$

274,358

 

 

 

 

 

 

 

Variable rate secured debt, weighted average interest rate of 1.71% at December 31, 2002, and 2.46% at December 31, 2001, maturity dates ranging from 2006 to 2025

 

39,771

 

44,126

 

 

 

 

 

 

 

Fixed rate unsecured notes, weighted average interest rate of 6.95% at December 31, 2002, and 7.13% at December 31, 2001, maturity dates ranging from 2003 to 2028

 

1,526,138

 

1,376,372

 

 

 

 

 

 

 

Unsecured line of credit, interest rate of 2.07% at December 31, 2002, and 2.58% at December 31, 2001, maturity date of 2004

 

281,000

 

120,000

 

 

 

$

2,106,285

 

$

1,814,856

 

 

The fair value of the Partnership’s indebtedness as of December 31, 2002, was $2.3 billion.

 

As of December 31, 2002, the $299.1 million of secured debt is collateralized by rental properties with a net carrying value of $561.3 million.

 

The Partnership has the following lines of credit available (in thousands):

 

Description

 

Borrowing
Capacity

 

Maturity
Date

 

Interest
Rate

 

Outstanding
at December
31, 2002

 

Unsecured Line of Credit

 

$

500,000

 

February 2004

 

LIBOR + .65

%

$

281,000

 

Secured Line of Credit

 

$

50,000

 

January 2006

 

LIBOR + .60

%

$

23,895

 

 

The lines of credit are used to fund development activities, to acquire additional rental properties and to provide working capital.

 

44



 

In December 2002, the Partnership renewed its secured line of credit by which the capacity was reduced from $100 million to $50 million, the interest rate reduced from LIBOR + 1.05% to LIBOR + .60%, and the maturity date extended to January 2006.

 

The $500 million line of credit allows the Partnership an option to obtain borrowings from the financial institutions that participate in the line of credit at rates lower than the stated interest rate, subject to certain restrictions. Amounts outstanding on the line of credit at December 31, 2002 are at LIBOR + .65% (2.07% at December 31, 2002).

 

In January 2003, the Partnership completed an issuance of unsecured debt totaling $175 million, bearing interest at 5.25% and due 2010.

 

At December 31, 2002, scheduled amortization and maturities of all indebtedness for the next five years and thereafter are as follows  (in thousands):

 

Year

 

Amount

 

 

 

 

 

2003

 

$

259,746

 

2004

 

470,875

 

2005

 

214,172

 

2006

 

177,776

 

2007

 

120,547

 

Thereafter

 

863,169

 

 

 

$

2,106,285

 

 

Cash paid for interest in 2002, 2001, and 2000 was $125.9 million, $140.5 million and $156.5 million, respectively. Total interest capitalized in 2002, 2001 and 2000 was $13.5 million, $25.9 million and $33.0 million, respectively.

 

(7)             Segment Reporting

 

The Partnership is engaged in four operating segments, the ownership and rental of office, industrial, and retail real estate investments (“Rental Operations”) and the providing of various real estate services such as property management, maintenance, leasing, and construction management to third-party property owners (“Service Operations”). The Partnership’s reportable segments offer different products or services and are managed separately because each requires different operating strategies and management expertise. There are no material intersegment sales or transfers.

 

Non-segment revenue to reconcile to total revenue consists mainly of equity in earnings of joint ventures. Non- segment assets reconciliation to total assets consists of corporate assets including cash, deferred financing costs and investments in unconsolidated subsidiaries.

 

The accounting policies of the segments are the same as those described in Note 2.

 

The Partnership assesses and measures segment operating results based on a performance measure referred to as Funds From Operations (“FFO”). The National Association of Real Estate Investment Trusts defines FFO as GAAP net income or loss, excluding gains or losses from sales of depreciated property, plus operating property depreciation and amortization and adjustments for minority interest and unconsolidated companies on the same basis. FFO is not a measure of operating results or cash flows from operating activities as measured by generally accepted accounting principles, is not necessarily indicative of cash available to fund cash needs and should not be considered an alternative to cash flows as a measure of liquidity. Interest expense and other non-property specific revenues and expenses are not allocated to individual segments in determining the Partnership’s performance measure.

 

45



 

The revenues and FFO for each of the reportable segments are summarized as follows for the years ended December 31, 2002, 2001, and 2000, and the assets of each reportable segment as of December 31, 2002 and 2001 (in thousands):

 

 

 

2002

 

2001

 

2000

 

Revenues

 

 

 

 

 

 

 

Rental Operations:

 

 

 

 

 

 

 

Office

 

$

398,169

 

$

379,272

 

$

332,265

 

Industrial

 

276,353

 

286,088

 

327,697

 

Retail

 

6,933

 

18,212

 

28,467

 

Service Operations

 

67,620

 

80,459

 

82,799

 

Total Segment Revenues

 

749,075

 

764,031

 

771,228

 

Non-Segment Revenue

 

30,071

 

31,167

 

18,318

 

Consolidated Revenue from continuing operations

 

779,146

 

795,198

 

789,546

 

Discontinued Operations

 

7,491

 

8,610

 

5,079

 

Consolidated Revenue

 

$

786,637

 

$

803,808

 

$

794,625

 

 

 

 

 

 

 

 

 

Funds From Operations

 

 

 

 

 

 

 

Rental Operations:

 

 

 

 

 

 

 

Office

 

$

265,811

 

$

255,308

 

$

225,496

 

Industrial

 

212,620

 

223,065

 

256,336

 

Retail

 

5,990

 

15,036

 

23,008

 

Services Operations

 

29,520

 

35,115

 

32,760

 

Total Segment FFO

 

513,941

 

528,524

 

537,600

 

Non-Segment FFO:

 

 

 

 

 

 

 

Interest expense

 

(117,073

)

(111,880

)

(131,418

)

Interest income

 

3,849

 

5,308

 

6,866

 

General and administrative expense

 

(24,735

)

(15,553

)

(21,137

)

Gain on land sales

 

4,478

 

5,080

 

9,165

 

Other expenses

 

(330

)

(3,899

)

(2,826

)

Minority interest in earnings of subsidiaries

 

(1,093

)

(2,411

)

(2,145

)

Joint Venture FFO

 

44,837

 

45,570

 

24,182

 

Dividends on preferred units

 

(52,613

)

(60,850

)

(57,389

)

Discontinued operations

 

5,193

 

5,804

 

2,231

 

Consolidated FFO

 

376,454

 

395,693

 

365,129

 

 

 

 

 

 

 

 

 

Depreciation and amortization on continuing operations

 

(174,902

)

(157,502

)

(161,454

)

Depreciation and amortization on discontinued operations

 

(719

)

(2,212

)

(1,069

)

Share of joint venture adjustments

 

(17,657

)

(14,177

)

(9,104

)

Earnings (loss) from depreciated property sales on continuing operations

 

(4,888

)

40,628

 

51,527

 

Earnings from depreciated property sales on discontinued operations

 

1,458

 

 

 

 

 

 

 

 

 

 

 

Net income available for common shareholders

 

$

179,746

 

$

262,430

 

$

245,029

 

 

 

 

December 31, 2002

 

December 31, 2001

 

Assets

 

 

 

 

 

Rental Operations

 

 

 

 

 

Office

 

$

2,677,427

 

$

2,625,015

 

Industrial

 

2,144,686

 

2,184,234

 

Retail

 

71,072

 

64,946

 

Service Operations

 

91,399

 

99,554

 

Total Segment Assets

 

4,984,584

 

4,973,749

 

Non-Segment Assets

 

362,471

 

356,497

 

Consolidated Assets

 

$

5,347,055

 

$

5,330,246

 

 

(8)             Leasing Activity

 

Future minimum rents due to the Partnership under non-cancelable operating leases at December 31, 2002, are as follows (in thousands):

 

Year

 

Amount

 

 

 

 

 

2003

 

$

530,961

 

2004

 

495,229

 

2005

 

420,784

 

2006

 

346,385

 

2007

 

281,386

 

Thereafter

 

940,103

 

 

 

$

3,014,848

 

 

46



 

In addition to minimum rents, certain leases require reimbursements of specified operating expenses which amounted to $120.1 million, $115.7 million, and $114.2  million for the years ended December 31, 2002, 2001 and 2000, respectively.

 

(9)             Employee Benefit Plans

 

The Partnership maintains a 401(k) plan for the benefit of its full-time employees.  The Partnership matches the employees’ contributions up to three percent of the employees’ salary and may also make annual discretionary contributions. Total expense recognized by the Partnership was $1.7 million, $1.3 million and $3.2 million for the years ended 2002, 2001 and 2000, respectively.

 

The Partnership makes contributions to a contributory health and welfare plan as necessary to fund claims not covered by employee contributions. Total expense recognized by the Partnership related to this plan was $4.9 million, $5.6 million and $6.0 million for 2002, 2001 and 2000, respectively. Included in total expense is an estimate based on historical experience of the effect of claims incurred but not reported as of year-end.

 

(10)      Partners’ Equity

 

The General Partner periodically accesses the public equity markets to fund the development and acquisition of additional rental properties.

 

The following series of preferred equity are outstanding as of December 31, 2002 (in thousands, except percentages):

 

Description

 

Shares
Outstanding

 

Dividend
Rate

 

Redemption
Date

 

Liquidation
Preference

 

Convertible

 

 

 

 

 

 

 

 

 

 

 

 

 

Series B Preferred

 

265

 

7.990

%

September 30, 2007

 

$

132,250

 

No

 

Series D Preferred

 

535

 

7.375

%

December 31, 2003

 

133,639

 

Yes

 

Series E Preferred

 

400

 

8.250

%

January 20, 2004

 

100,000

 

No

 

Series I Preferred

 

300

 

8.450

%

February 6, 2006

 

75,000

 

No

 

 

All series of preferred equity require cumulative distributions and have no stated maturity date.

 

The Series D Preferred equity are convertible at a conversion rate of .93677 common units for each preferred unit outstanding.

 

The dividend rate on the Series B Preferred equity increases to 9.99% after September 12, 2012. The General Partner repurchased 355,000 shares of the Series B Preferred equity in September 2002. The repurchase transaction was initiated by a group of Series B Preferred unitholders who voluntarily approached the General Partner and the Partnership with an opportunity to buyback these shares before their earliest stated redemption date.

 

The General Partner and the Partnership redeemed its $150.0 million Series F Preferred equity in October 2002 at par value.

 

Effective August 31, 2002, the Partnership terminated a shareholder rights plan that had included the potential issuance of Series C Junior Preferred equity.

 

(11)      Stock Based Compensation

 

At December 31, 2002, the General Partner and the Partnership had nine stock-based employee compensation plans that are described more fully below.  The General Partner and the Partnership are authorized to issue up to 8,569,860 shares of the General Partner’s common stock under these Plans.

 

47



 

Awards under these plans generally vest over five years at 20% per year. Therefore, the expense related to stock-based employee compensation included in the determination of net income is less than that which would have been recognized if the fair value method had been applied to all awards since the original effective date of SFAS 123. The following table illustrates the effect on net income and earnings per unit if the fair value method had been applied to all outstanding and unvested awards in each period.

 

 

 

2002

 

2001

 

2000

 

Net income, as reported

 

$

179,746

 

$

262,430

 

$

245,029

 

Add:  Stock-based employee compensation expense included in net income determined under fair value method

 

405

 

0

 

0

 

Deduct:  Total stock based compensation expense determined under fair value method for all awards

 

(1,334

)

(1,236

)

(593

)

Proforma Net Income

 

$

178,817

 

$

261,194

 

$

244,436

 

 

 

 

 

 

 

 

 

Basic net income per unit

 

 

 

 

 

 

 

As reported

 

$

1.20

 

$

1.77

 

$

1.68

 

Pro forma

 

$

1.20

 

$

1.76

 

$

1.67

 

 

 

 

 

 

 

 

 

Diluted net income per unit

 

 

 

 

 

 

 

As reported

 

$

1.19

 

$

1.75

 

$

1.66

 

Pro forma

 

$

1.19

 

$

1.74

 

$

1.66

 

 

The fair values of the options were determined using the Black-Scholes option-pricing model with the following assumptions:

 

 

 

2002

 

2001

 

2000

 

Dividend yield

 

7.25

%

7.50

%

7.00

%

Volatility

 

20.0

%

20.2

%

20.2

%

Risk-free interest rate

 

4.7

%

5.0

%

5.8

%

Expected life

 

6 years

 

6 years

 

6 years

 

 

Fixed Stock Option Plans

 

The General Partner and the Partnership had options outstanding under six fixed stock option plans as of December 31, 2002. Additional grants may be made under three of those plans.

 

A summary of the status of the fixed stock option plans as of December 31, 2002, 2001 and 2000 and changes during the years ended on those dates follows:

 

 

 

2002

 

2001

 

2000

 

 

 

Units

 

Weighted
Average
Exercise
Price

 

Units

 

Weighted
Average
Exercise
Price

 

Units

 

Weighted
Average
Exercise
Price

 

Outstanding, beginning of year

 

4,691,659

 

$

21.12

 

5,235,464

 

$

19.52

 

5,043,965

 

$

19.00

 

Granted

 

676,038

 

23.37

 

718,320

 

24.98

 

958,786

 

20.04

 

Exercised

 

(1,203,534

)

18.82

 

(982,243

)

15.21

 

(440,924

)

13.66

 

Forfeited

 

(243,965

)

22.96

 

(279,882

)

21.84

 

(326,363

)

22.95

 

Outstanding, end of year

 

3,920,198

 

22.09

 

4,691,659

 

21.12

 

5,235,464

 

19.52

 

Options exercisable, end of year

 

2,297,500

 

 

 

2,965,930

 

 

 

3,112,706

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average fair value of options granted during the year

 

$

2.05

 

 

 

$

2.19

 

 

 

$

2.18

 

 

 

 

The options outstanding at December 31, 2002, under the fixed stock option plans have a range of exercise prices from $11.87 to $25.50 with a weighted average exercise price of $22.09 and a weighted average remaining contractual life of 6.41 years. The options exercisable at December 31, 2002 have a weighted average exercise price of $21.41.

 

Each option’s maximum term is ten years. With limited exceptions, options vest at 20% per year, or, if earlier, upon the death, retirement or disability of the optionee or a change in control of the Partnership.

 

48



 

Performance Based Stock Plans

 

Performance shares are granted under the 2000 Performance Share Plan, with each performance share economically equivalent to one share of the General Partner’s common stock. The performance shares vest over a 5-year period with the vesting percentage for a year dependent upon the Partnership’s attainment of certain predefined levels of earnings growth for such year. The value of vested performance shares are payable in cash upon the retirement or termination of employment of the participant.  At December 31, 2002, plan participants had the right to receive up to 61,922 performance shares, of which 30,423 were vested and 31,499 were contingent upon future earnings achievement.

 

For grants prior to 2002, compensation cost is based upon the value of the vested performance shares at the end of each applicable reporting period. No grants were made in 2002 under this plan. The compensation cost that has been charged against income for this plan was $96,000, $201,000  and $962,000 for 2002, 2001 and 2000, respectively.

 

In October 2002, the General Partner and the Partnership amended the Shareholder Value Plan (“SVP Plan”) and Dividend Increase Unit Plans (“DIU Plans”) by requiring that all payouts under these two plans to be in cash only. The SVP Plan is based on the General Partner’s cumulative shareholder return for a three-year period as compared to the cumulative total return of the S&P 500 and the NAREIT Equity REIT Total Return indices. The DIU Plans are based upon increases in the General Partner’s dividend. The total compensation cost that has been charged against income for these two plans was $4.6 million, $6.0 million and $6.7 million for 2002, 2001 and 2000, respectively.

 

Directors Stock Payment Plan

 

Under the General Partner’s 1999 Directors’ Stock Payment Plan, non-employee members of the General Partner’s Board of Directors are entitled to 1,200 shares of common stock per year as partial compensation for services as a board member. The shares are fully vested when issued and the value of the shares are recorded as an expense by the Partnership. The amount of that expense was $274,000, $260,000 and $230,000 for 2002, 2001 and 2000, respectively.

 

Employee Stock Purchase Plan

 

Under the General Partner and the Partnership’s Employee Stock Purchase Plan, employees are entitled to purchase common stock at a 15% discount through payroll deductions. Under SFAS 123, the Partnership is required to record the amount of the discount as compensation expense. The amount of that expense for 2002 was $181,496.

 

(12)      Derivative Instruments

 

The Partnership is exposed to capital market risk, such as changes in interest rates.  In order to manage the volatility relating to interest rate risk, the Partnership may enter into interest rate hedging arrangements from time to time. The Partnership does not utilize derivative financial instruments for trading or speculative purposes. On January 1, 2001, the Partnership adopted Statement of Financial Accounting Standard No. 133, “Accounting for Derivative Instruments and Hedging Activities” as amended (“SFAS 133”). SFAS 133 establishes accounting and reporting standards for derivative instruments and requires that entities recognize all derivatives as either assets or liabilities and measure those instruments at fair value. The cumulative effect of adopting SFAS 133 was not material to the Partnership’s financial statements.

 

During the years ended December 31, 2002 and 2001, the Partnership recorded a $1.4 million gain and a $1.4 million loss, respectively, associated with an interest rate contract that did not qualify for hedge accounting. The contract expired on December 30, 2002.

 

49



 

In December 2002, the Partnership simultaneously entered into two $50 million forward-starting interest rate swaps. The Partnership designated the aggregate $100 million swaps as a hedge to effectively fix the rate on financing expected in 2003. The Partnership expects and intends that the financing will be a ten-year fixed-rate semi-annual financing, pricing between May 1, 2003 and November 1, 2003. The fair value of the swaps was a liability of ($2.1) million as of December 31, 2002, and is recorded in other liabilities in the accompanying balance sheet. The swaps qualify for hedge accounting under SFAS 133, therefore, changes in fair value will be recorded in other comprehensive income.

 

In July 2001, the Partnership terminated three interest rate swaps that were tied to an $85 million unsecured term loan. The swaps qualified for hedge accounting under SFAS 133. The costs to terminate the swaps was $548,000, which was recorded as interest expense and reversed out of other comprehensive income.

 

(13)      Commitments and Contingencies

 

In 1998 and 1999, members of management and the Board of Directors of the General Partner purchased $69 million of the General Partner’s common stock in connection with an Executive and Senior Officer Stock Purchase Plan. The purchases were financed by five-year personal loans at market interest rates from financial institutions. As of December 31, 2002, the outstanding balance on these loans is $33.5 million as some participants have exited the program and repaid their principal balance. These loans are secured by $41.0 million of common shares purchased through this program and held at December 31, 2002, by the remaining plan participants. As a condition of the financing agreement with the financial institution, the Partnership has guaranteed repayment of principal, interest and other obligations for each participant, but is fully indemnified by the participants. In the opinion of management, it is not probable that the Partnership will be required to satisfy these guarantees.

 

The Partnership has entered into agreements, subject to the completion of due diligence requirements, resolution of certain contingencies and completion of customary closing conditions, for the future acquisition of land totaling $26.2 million. The acquisitions are scheduled to close periodically through 2003 and will be paid for through a combination of cash or common units.

 

The Partnership renewed all major insurance programs for 2002-2003, including obtaining coverage for acts of terrorism for its properties. The Partnership believes that insurance is in place that provides adequate coverage to provide financial protection against normal insurance risks such that it believes that any loss experienced would not have a significant impact on the Partnership’s liquidity, financial position, or results of operations.

 

The Partnership is subject to various legal proceedings and claims that arise in the ordinary course of business.  In the opinion of management, the amount of any ultimate liability with respect to these actions will not materially affect the Partnership’s consolidated financial statements or results of operations.

 

50



 

DUKE REALTY LIMITED PARTNERSHIP

 

Schedule 3

REAL ESTATE AND ACCUMULATED DEPRECIATION

 

DECEMBER 31, 2002

 

 

(IN THOUSANDS)

 

 

 

Development

 

Name

 

Building
Type

 

Encumbrances

 

 

 

 

 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ALPHARETTA, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brookside Office Park

 

3925 Brookside Parkway

 

Office

 

 

1,269

 

14,705

 

7

 

1,269

 

14,711

 

15,980

 

1,294

 

1998

 

1999

 

Brookside Office Park

 

3625 Brookside Parkway

 

Office

 

 

1,625

 

10,984

 

2,690

 

1,625

 

13,675

 

15,300

 

1,931

 

1999

 

1999

 

Brookside Office Park

 

Radiant II

 

Office

 

 

831

 

7,265

 

115

 

831

 

7,380

 

8,211

 

332

 

2000

 

2000

 

Brookside Office Park

 

Brookside II

 

Office

 

 

1,381

 

12,250

 

 

1,381

 

12,250

 

13,632

 

512

 

2000

 

2001

 

Hembree Crest

 

11800 Wills Road

 

Industrial

 

 

304

 

2,146

 

336

 

304

 

2,482

 

2,786

 

299

 

1987

 

1999

 

Hembree Crest

 

11810 Wills Road

 

Industrial

 

 

296

 

2,254

 

228

 

296

 

2,482

 

2,778

 

305

 

1987

 

1999

 

Hembree Crest

 

11820 Wills Road

 

Industrial

 

 

488

 

2,277

 

860

 

488

 

3,137

 

3,625

 

271

 

1987

 

1999

 

Hembree Crest

 

11415 Old Roswell Road

 

Industrial

 

 

648

 

2,454

 

1,066

 

648

 

3,521

 

4,169

 

415

 

1991

 

1999

 

Hembree Park

 

1750 Founders

 

Industrial

 

 

1,936

 

7,731

 

1

 

1,936

 

7,732

 

9,668

 

1,077

 

1999

 

2000

 

Hembree Park

 

NMeadow SC II @ Founders

 

Industrial

 

 

1,369

 

3,591

 

216

 

1,369

 

3,807

 

5,176

 

126

 

2001

 

2001

 

North Meadow

 

1350 Northmeadow Parkway

 

Industrial

 

 

672

 

3,648

 

260

 

672

 

3,908

 

4,580

 

419

 

1994

 

1999

 

North Meadow

 

11835 Alpharetta Highway

 

Retail

 

 

524

 

2,861

 

5

 

524

 

2,866

 

3,390

 

249

 

1994

 

1999

 

Northwinds Pointe

 

2550 Northwinds Parkway

 

Office

 

 

2,271

 

20,017

 

250

 

2,271

 

20,267

 

22,538

 

1,849

 

1998

 

1999

 

Ridgeland

 

1320 Ridgeland Pkwy

 

Industrial

 

 

998

 

5,874

 

37

 

998

 

5,911

 

6,909

 

508

 

1999

 

1999

 

Ridgeland

 

Ridgeland Business Dist I

 

Industrial

 

 

488

 

2,937

 

1,332

 

488

 

4,268

 

4,757

 

1,016

 

1999

 

1999

 

Ridgeland

 

Ridgeland Business Dist. II

 

Industrial

 

 

579

 

2,529

 

28

 

579

 

2,557

 

3,136

 

310

 

1999

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ANTIOCH, TENNESSEE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Jackson Business Center

 

Keebler

 

Industrial

 

 

307

 

1,299

 

20

 

307

 

1,319

 

1,626

 

248

 

1985

 

1995

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ARLINGTON HEIGHTS, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Arlington Business Park

 

Atrium II

 

Office

 

 

776

 

7,209

 

1,128

 

776

 

8,337

 

9,113

 

1,221

 

1986

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ATLANTA, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Druid Chase

 

6 W. Druid Hills Drive

 

Office

 

 

473

 

6,758

 

555

 

473

 

7,313

 

7,786

 

629

 

1968

 

1999

 

Druid Chase

 

2801 Buford Highway

 

Office

 

 

794

 

9,905

 

1,400

 

794

 

11,305

 

12,099

 

1,086

 

1977

 

1999

 

Druid Chase

 

1190 W. Druid Hills Drive

 

Office

 

 

689

 

6,631

 

412

 

689

 

7,043

 

7,732

 

598

 

1980

 

1999

 

Druid Chase

 

2071 N. Druid Hills Drive

 

Retail

 

 

98

 

321

 

 

98

 

321

 

419

 

28

 

1968

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AURORA, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Meridian Business Campus

 

535 Exchange

 

Industrial

 

 

386

 

920

 

 

386

 

920

 

1,306

 

82

 

1984

 

1999

 

Meridian Business Campus

 

515-525 North Enterprise

 

Industrial

 

 

342

 

1,678

 

90

 

342

 

1,768

 

2,110

 

198

 

1984

 

1999

 

Meridian Business Campus

 

615 Enterprise

 

Industrial

 

 

468

 

2,824

 

123

 

468

 

2,947

 

3,415

 

306

 

1984

 

1999

 

Meridian Business Campus

 

3615 Exchange

 

Industrial

 

 

410

 

1,603

 

50

 

410

 

1,653

 

2,063

 

157

 

1986

 

1999

 

Meridian Business Campus

 

4000 Sussex

 

Industrial

 

 

417

 

1,940

 

32

 

417

 

1,972

 

2,389

 

185

 

1990

 

1999

 

Meridian Business Campus

 

3737 East Exchange

 

Industrial

 

 

598

 

2,543

 

16

 

598

 

2,559

 

3,157

 

236

 

1985

 

1999

 

Meridian Business Campus

 

444 North Commerce

 

Industrial

 

 

722

 

5,411

 

411

 

722

 

5,823

 

6,545

 

583

 

1985

 

1999

 

Meridian Business Campus

 

Meridian I

 

Industrial

 

 

1,150

 

6,673

 

260

 

1,150

 

6,934

 

8,083

 

1,056

 

1999

 

2000

 

Meridian Business Campus

 

Meridian II

 

Industrial

 

 

 

567

 

164

 

 

567

 

164

 

731

 

43

 

2001

 

2001

 

Meridian Business Campus

 

Meridian II

 

Industrial

 

 

567

 

1,508

 

 

567

 

1,508

 

2,075

 

 

2001

 

2001

 

Meridian Business Campus

 

Meridian Outlot

 

Grounds

 

 

894

 

 

 

894

 

 

894

 

 

 

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BEACHWOOD, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate Exchange

 

One Corporate Exchange

 

Office

 

5,048

 

1,287

 

8,726

 

961

 

1,287

 

9,687

 

10,974

 

1,665

 

1989

 

1996

 

Corporate Place

 

Corporate Place

 

Office

 

 

1,161

 

7,838

 

650

 

1,163

 

8,486

 

9,649

 

1,372

 

1988

 

1996

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BLOOMINGTON, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alpha Buildings

 

Alpha Business Ctr I&II

 

Office

 

 

280

 

1,615

 

281

 

280

 

1,896

 

2,176

 

196

 

1980

 

1999

 

Alpha Buildings

 

Alpha Business Ctr III&IV

 

Industrial

 

 

341

 

1,965

 

174

 

341

 

2,138

 

2,479

 

216

 

1980

 

1999

 

Alpha Buildings

 

Alpha Business Ctr V

 

Industrial

 

 

537

 

3,089

 

149

 

538

 

3,237

 

3,775

 

302

 

1980

 

1999

 

Bloomington Industrial Center

 

Bloomington Industrial Center

 

Industrial

 

1,508

 

621

 

3,650

 

764

 

621

 

4,414

 

5,035

 

822

 

1963

 

1997

 

Hampshire Dist. Center

 

Hampshire Dist Center North

 

Industrial

 

2,224

 

779

 

4,500

 

56

 

779

 

4,556

 

5,334

 

582

 

1979

 

1997

 

Hampshire Dist. Center

 

Hampshire Dist Center South

 

Industrial

 

2,666

 

901

 

5,234

 

262

 

901

 

5,495

 

6,397

 

703

 

1979

 

1997

 

 

51



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hampshire Tech Center

 

Hampshire Tech Center

 

Industrial

 

 

2,124

 

13,102

 

645

 

2,223

 

13,647

 

15,870

 

1,919

 

1998

 

1998

 

Lyndale Commons

 

Lyndale Commons I

 

Industrial

 

 

247

 

1,443

 

214

 

247

 

1,656

 

1,903

 

244

 

1981

 

1998

 

Lyndale Commons

 

Lyndale Commons II

 

Industrial

 

 

181

 

1,048

 

201

 

183

 

1,247

 

1,430

 

160

 

1985

 

1998

 

Norman Center

 

Norman Center 2

 

Office

 

 

782

 

4,489

 

141

 

807

 

4,605

 

5,412

 

522

 

1970

 

1998

 

Norman Center

 

Norman Center 4

 

Office

 

 

562

 

3,265

 

333

 

579

 

3,581

 

4,159

 

500

 

1967

 

1998

 

Norman Center Plaza

 

Norman Pointe I

 

Office

 

 

3,660

 

28,229

 

 

3,660

 

28,229

 

31,889

 

1,118

 

2000

 

2000

 

Penn Corporate Building

 

Penn Corporate Bldg

 

Industrial

 

 

312

 

1,801

 

68

 

312

 

1,869

 

2,181

 

235

 

1977

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BLUE ASH, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alliance Woods

 

McAuley Place

 

Office

 

 

 

2,331

 

18,596

 

 

2,331

 

18,596

 

20,926

 

624

 

2000

 

2001

 

Cornell Commerce Center

 

Cornell Commerce Center

 

Industrial

 

 

495

 

4,787

 

187

 

495

 

4,974

 

5,469

 

884

 

1989

 

1996

 

Creek Road

 

Creek Road Bldg 1

 

Industrial

 

 

103

 

833

 

36

 

103

 

870

 

972

 

134

 

1971

 

1996

 

Creek Road

 

Creek Road Bldg 2

 

Industrial

 

 

132

 

1,149

 

62

 

132

 

1,211

 

1,343

 

186

 

1971

 

1996

 

Huntington Bank Building

 

Huntington Bank Building

 

Office

 

 

175

 

241

 

 

175

 

241

 

416

 

37

 

1986

 

1996

 

Lake Forest/Westlake

 

Lake Forest Place

 

Office

 

 

1,953

 

20,207

 

1,821

 

1,953

 

22,028

 

23,981

 

3,933

 

1985

 

1996

 

Lake Forest/Westlake

 

Westlake Center

 

Office

 

 

2,459

 

16,884

 

1,414

 

2,459

 

18,299

 

20,757

 

3,263

 

1981

 

1996

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BOLINGBROOK, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bolingbrook (ComEd)

 

555 Joliet Road

 

Industrial

 

 

 

2,184

 

9,284

 

 

2,184

 

9,284

 

11,468

 

167

 

1967

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BRANDON, FLORIDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regency Park North

 

Regency I

 

Office

 

 

1,048

 

4,230

 

105

 

1,048

 

4,336

 

5,384

 

523

 

2000

 

2000

 

Regency Park North

 

Regency II

 

Office

 

 

 

1,411

 

3,797

 

 

1,411

 

3,797

 

5,208

 

178

 

2001

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BRASELTON, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Braselton

 

Braselton II

 

Industrial

 

 

1,365

 

9,505

 

 

1,365

 

9,505

 

10,871

 

250

 

2001

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BRENTOOD, TENNESSEE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brentwood South Bus. Center

 

7104 Crossroads Blvd

 

Industrial

 

 

1,065

 

5,994

 

481

 

1,065

 

6,475

 

7,540

 

565

 

1987

 

1999

 

Brentwood South Bus. Center

 

7106 Crossroads Blvd

 

Industrial

 

 

1,065

 

2,836

 

940

 

1,065

 

3,775

 

4,840

 

344

 

1987

 

1999

 

Brentwood South Bus. Center

 

7108 Crossroads Blvd

 

Industrial

 

 

848

 

4,141

 

201

 

848

 

4,341

 

5,189

 

383

 

1989

 

1999

 

Creekside Crossing

 

Creekside Crossing One

 

Office

 

 

1,900

 

8,445

 

972

 

1,901

 

9,416

 

11,317

 

2,136

 

1997

 

1998

 

Creekside Crossing

 

Creekside Crossing Two

 

Office

 

 

2,087

 

9,642

 

522

 

2,087

 

10,164

 

12,251

 

1,345

 

1999

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BROOKLYN PARK, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7300 Northland Drive

 

7300 Northland Drive

 

Industrial

 

 

700

 

6,635

 

53

 

703

 

6,686

 

7,389

 

1,121

 

1980

 

1998

 

Crosstown North

 

Crosstown North Bus. Ctr. 1

 

Industrial

 

 

835

 

5,459

 

828

 

1,091

 

6,031

 

7,122

 

725

 

1998

 

1999

 

Crosstown North

 

Crosstown North Bus. Ctr. 2

 

Industrial

 

 

449

 

2,961

 

294

 

525

 

3,179

 

3,704

 

387

 

1998

 

1999

 

Crosstown North

 

Crosstown North Bus. Ctr. 3

 

Industrial

 

 

758

 

2,741

 

77

 

784

 

2,791

 

3,575

 

576

 

1999

 

1999

 

Crosstown North

 

Crosstown North Bus. Ctr. 4

 

Industrial

 

 

2,079

 

8,138

 

777

 

2,206

 

8,788

 

10,994

 

1,230

 

1999

 

1999

 

Crosstown North

 

Crosstown North Bus. Ctr. 5

 

Industrial

 

 

1,079

 

5,595

 

120

 

1,191

 

5,602

 

6,794

 

751

 

1999

 

2000

 

Crosstown North

 

Crosstown North Bus. Ctr. 6

 

Industrial

 

 

788

 

3,651

 

45

 

788

 

3,696

 

4,484

 

398

 

2000

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BURNSVILLE, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cliff Road Industrial Center

 

Cliff Road Industrial Ctr

 

Industrial

 

 

256

 

1,493

 

66

 

256

 

1,559

 

1,816

 

191

 

1972

 

1998

 

Larc Industrial Park

 

Larc Industrial Park I

 

Industrial

 

 

280

 

1,644

 

131

 

280

 

1,776

 

2,055

 

252

 

1977

 

1997

 

Larc Industrial Park

 

Larc Industrial Park II

 

Industrial

 

 

224

 

1,327

 

144

 

224

 

1,470

 

1,695

 

209

 

1976

 

1997

 

Larc Industrial Park

 

Larc Industrial Park III

 

Industrial

 

 

135

 

800

 

48

 

135

 

848

 

983

 

109

 

1980

 

1997

 

Larc Industrial Park

 

Larc Industrial Park IV

 

Industrial

 

 

90

 

539

 

6

 

90

 

545

 

635

 

77

 

1980

 

1997

 

Larc Industrial Park

 

Larc Industrial Park V

 

Industrial

 

 

96

 

555

 

242

 

96

 

797

 

893

 

125

 

1980

 

1997

 

Larc Industrial Park

 

Larc Industrial Park VI

 

Industrial

 

 

373

 

2,149

 

277

 

373

 

2,426

 

2,799

 

309

 

1975

 

1997

 

Larc Industrial Park

 

Larc Industrial Park VII

 

Industrial

 

 

242

 

1,394

 

213

 

242

 

1,607

 

1,849

 

255

 

1973

 

1997

 

Professional Plaza

 

Professional Plaza III

 

Industrial

 

 

237

 

1,359

 

277

 

241

 

1,632

 

1,873

 

253

 

1985

 

1998

 

Professional Plaza

 

Professional Plaza II

 

Industrial

 

 

216

 

1,272

 

285

 

216

 

1,557

 

1,773

 

240

 

1984

 

1998

 

SE Submarket-Burnsville

 

Professional Plaza I

 

Office

 

 

467

 

2,731

 

285

 

467

 

3,016

 

3,483

 

421

 

1986

 

1998

 

 

52



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CANAL WINCHESTER, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nifco at Canal Winchester

 

Nifco at Canal Winchester

 

Industrial

 

 

400

 

3,386

 

6

 

400

 

3,392

 

3,792

 

197

 

2000

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CARMEL, INDIANA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hamilton Crossing

 

Hamilton Crossing Bldg 1

 

Industrial

 

 

835

 

4,881

 

1,911

 

847

 

6,780

 

7,627

 

1,224

 

1989

 

1993

 

Hamilton Crossing

 

Hamilton Crossing Bldg 2

 

Office

 

 

313

 

1,410

 

833

 

384

 

2,172

 

2,556

 

488

 

1997

 

1997

 

Hamilton Crossing

 

Hamilton Crossing Bldg 3

 

Office

 

 

890

 

10,040

 

316

 

890

 

10,356

 

11,246

 

918

 

2000

 

2000

 

Hamilton Crossing

 

Hamilton Crossing Bldg 4

 

Office

 

 

515

 

6,491

 

26

 

598

 

6,434

 

7,032

 

1,338

 

1999

 

1999

 

Hamilton Crossing Retail

 

Hamilton Crossing Retail Bld 1

 

Retail

 

 

728

 

6,763

 

186

 

898

 

6,779

 

7,677

 

731

 

1999

 

1999

 

Hamilton Crossing Retail

 

Hampton Inn Land Lease

 

Grounds

 

 

137

 

 

72

 

209

 

 

209

 

 

 

 

1999

 

Hamilton Crossing Retail

 

Max & Ermas

 

Grounds

 

 

167

 

 

 

167

 

 

167

 

 

 

 

2000

 

Meridian Technology Center

 

Meridian Tech Center

 

Office

 

 

 

600

 

2,695

 

 

600

 

2,695

 

3,295

 

34

 

1986

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CARY, NORTH CAROLINA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Regency Forest

 

200 Regency Forest Dr.

 

Office

 

 

1,230

 

13,501

 

295

 

1,230

 

13,796

 

15,026

 

1,346

 

1999

 

1999

 

Regency Forest

 

100 Regency Forest Dr.

 

Office

 

 

1,538

 

10,756

 

1,664

 

1,618

 

12,339

 

13,958

 

1,703

 

1997

 

1999

 

Regency Forest

 

Regency Forest III

 

Office

 

 

1,134

 

9,604

 

117

 

1,134

 

9,721

 

10,855

 

388

 

2000

 

2001

 

Weston Parkway

 

6501 Weston Parkway

 

Office

 

7,317

 

1,775

 

10,668

 

56

 

1,775

 

10,724

 

12,499

 

943

 

1996

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CELEBRATION, FLORIDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Celebration Business Center

 

Celebration Business Center I

 

Office

 

 

1,102

 

4,843

 

868

 

1,308

 

5,505

 

6,813

 

770

 

1997

 

1999

 

Celebration Business Center

 

Celebration Business Center II

 

Office

 

 

771

 

3,590

 

190

 

961

 

3,590

 

4,551

 

321

 

1997

 

1999

 

Celebration Business Center

 

Celebration Office Center I

 

Office

 

 

 

1,382

 

7,921

 

 

1,382

 

7,921

 

9,303

 

872

 

2000

 

2000

 

Celebration Business Center

 

Celebration Office Center II

 

Office

 

 

1,382

 

6,254

 

 

1,382

 

6,254

 

7,636

 

172

 

2001

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHANHASSEN, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Chanhassen Lakes

 

Chanhassen Lakes I

 

Industrial

 

 

357

 

2,078

 

667

 

370

 

2,733

 

3,103

 

406

 

1983

 

1998

 

Chanhassen Lakes

 

Chanhassen Lakes II

 

Industrial

 

 

438

 

2,542

 

165

 

453

 

2,693

 

3,145

 

319

 

1986

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHAPEL HILL, NORTH CAROLINA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Governors Village

 

Governors Village

 

Office

 

 

 

515

 

5,664

 

 

515

 

5,664

 

6,178

 

159

 

2000

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHICAGO, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

King’s Mall

 

Applebee’s Ground Lease

 

Grounds

 

 

338

 

 

 

338

 

 

338

 

 

 

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CINCINNATI, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

312 Elm

 

312 Elm

 

Office

 

38,366

 

4,750

 

47,227

 

4,566

 

5,428

 

51,114

 

56,542

 

13,074

 

1992

 

1993

 

312 Plum

 

312 Plum

 

Office

 

 

2,539

 

24,796

 

2,075

 

2,590

 

26,821

 

29,411

 

6,428

 

1987

 

1993

 

Blue Ash Office Center

 

Blue Ash Office Ctr VI

 

Office

 

 

518

 

2,852

 

253

 

518

 

3,104

 

3,622

 

424

 

1989

 

1997

 

Executive Plaza

 

Executive Plaza I

 

Office

 

 

728

 

5,525

 

328

 

728

 

5,854

 

6,582

 

869

 

1980

 

1996

 

Executive Plaza

 

Executive Plaza II

 

Office

 

 

728

 

5,628

 

 

728

 

5,628

 

6,356

 

821

 

1981

 

1996

 

Executive Plaza

 

Executive Plaza III

 

Office

 

 

509

 

4,992

 

1,360

 

509

 

6,352

 

6,861

 

1,467

 

1998

 

1998

 

Governors Hill

 

8790 Governor’s Hill

 

Office

 

 

400

 

4,784

 

547

 

408

 

5,323

 

5,731

 

1,212

 

1985

 

1993

 

Governors Hill

 

8800 Governor’s Hill

 

Office

 

 

225

 

2,298

 

12

 

231

 

2,305

 

2,536

 

955

 

1985

 

1986

 

Governors Hill

 

8600 Governor’s Hill

 

Office

 

 

1,220

 

18,998

 

1,228

 

1,245

 

20,202

 

21,447

 

4,544

 

1986

 

1993

 

Iams Industrial Park

 

Cincinnati Bell Supply

 

Industrial

 

 

606

 

3,237

 

 

606

 

3,238

 

3,843

 

230

 

1999

 

2000

 

Kenwood Commons

 

8230 Kenwood Commons

 

Office

 

4,557

 

638

 

3,308

 

786

 

638

 

4,095

 

4,732

 

2,037

 

1986

 

1986

 

Kenwood Commons

 

8280 Kenwood Commons

 

Office

 

2,443

 

638

 

1,863

 

35

 

638

 

1,899

 

2,537

 

894

 

1986

 

1986

 

Kenwood Executive Center

 

Kenwood Executive Center

 

Office

 

 

606

 

4,037

 

441

 

606

 

4,479

 

5,084

 

597

 

1981

 

1997

 

Kenwood MOB

 

Kenwood MOB

 

Office

 

 

 

 

 

7,798

 

 

 

7,798

 

7,798

 

627

 

1994

 

1999

 

One Ashview Place

 

One Ashview Place

 

Office

 

 

1,204

 

12,659

 

449

 

1,204

 

13,108

 

14,312

 

1,756

 

1989

 

1997

 

Park 50

 

Dun & Bradstreet Bldg

 

Office

 

1,577

 

270

 

2,718

 

447

 

466

 

2,970

 

3,435

 

1,200

 

1972

 

1986

 

Pfeiffer Place

 

Pfeiffer Place

 

Office

 

 

3,608

 

14,945

 

 

3,608

 

14,945

 

18,553

 

358

 

2001

 

2001

 

Pfeiffer Woods

 

Pfeiffer Woods

 

Office

 

6,457

 

1,450

 

12,322

 

266

 

1,450

 

12,588

 

14,038

 

1,065

 

1998

 

1999

 

 

53



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Remington Office Park

 

Remington Park Bldg A

 

Office

 

 

560

 

1,469

 

164

 

560

 

1,633

 

2,193

 

247

 

1982

 

1997

 

Remington Office Park

 

Remington Park Bldg B

 

Office

 

 

560

 

1,543

 

180

 

560

 

1,723

 

2,283

 

222

 

1982

 

1997

 

Triangle Office Park

 

Triangle Office Park

 

Office

 

4,935

 

1,018

 

11,511

 

 

1,018

 

11,511

 

12,530

 

4,724

 

1965

 

1986

 

World Park

 

World Park Bldg 5

 

Industrial

 

1,698

 

270

 

3,398

 

24

 

276

 

3,416

 

3,691

 

1,221

 

1987

 

1988

 

World Park

 

World Park Bldg 6

 

Industrial

 

1,994

 

378

 

3,845

 

111

 

385

 

3,950

 

4,335

 

1,365

 

1987

 

1988

 

World Park

 

World Park Bldg 7

 

Industrial

 

2,387

 

525

 

4,522

 

144

 

537

 

4,653

 

5,190

 

1,600

 

1987

 

1988

 

Zussman Building

 

Zussman Bldg

 

Office

 

 

339

 

6,864

 

818

 

346

 

7,675

 

8,021

 

2,565

 

1986

 

1993

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COLUMBUS, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Easton

 

Easton Way One

 

Office

 

 

1,874

 

10,338

 

180

 

1,874

 

10,518

 

12,392

 

1,074

 

2000

 

2000

 

Easton

 

Easton Way Two

 

Office

 

 

 

2,005

 

10,287

 

 

2,005

 

10,287

 

12,291

 

312

 

2001

 

2001

 

Easton Oval

 

One Easton Oval

 

Office

 

 

2,789

 

12,109

 

208

 

2,789

 

12,317

 

15,105

 

2,342

 

1998

 

1999

 

Easton Oval

 

Two Easton Oval

 

Office

 

 

2,489

 

16,828

 

310

 

2,489

 

17,138

 

19,627

 

1,985

 

1996

 

1998

 

Polaris

 

1000 Polaris Parkway

 

Office

 

 

1,200

 

6,636

 

1,425

 

1,293

 

7,968

 

9,261

 

808

 

1992

 

1999

 

Westbelt Drive

 

2190-2200 Westbelt Drive

 

Industrial

 

 

300

 

1,963

 

84

 

300

 

2,047

 

2,347

 

221

 

1986

 

1998

 

Westbelt West

 

Westbelt West #1

 

Industrial

 

 

432

 

4,165

 

872

 

432

 

5,037

 

5,469

 

736

 

1999

 

1999

 

Westbelt West

 

Westbelt West #2

 

Industrial

 

 

509

 

5,230

 

322

 

509

 

5,552

 

6,061

 

496

 

1999

 

2000

 

Zane Trace

 

3800 Zane Trace Drive

 

Industrial

 

 

170

 

2,097

 

411

 

170

 

2,508

 

2,678

 

550

 

1978

 

1994

 

Zane Trace

 

3635 Zane Trace Drive

 

Industrial

 

 

236

 

1,813

 

257

 

236

 

2,070

 

2,306

 

293

 

1980

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CREVE COUER, MISSOURI

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Twin Oaks Office Ctr

 

Twin Oaks

 

Office

 

 

566

 

8,304

 

1,403

 

566

 

9,707

 

10,273

 

1,444

 

1995

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CRYSTAL, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Crystal Industrial Center

 

Crystal Industrial Center

 

Industrial

 

 

456

 

2,621

 

528

 

480

 

3,125

 

3,605

 

534

 

1974

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DES PLAINES, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

105 East Oakton

 

105 East Oakton

 

Industrial

 

 

1,132

 

4,279

 

370

 

1,132

 

4,649

 

5,781

 

467

 

1974

 

1999

 

Deckbrand Building

 

Wolf Road Building

 

Industrial

 

 

179

 

1,632

 

232

 

179

 

1,864

 

2,043

 

217

 

1966

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DOWNERS GROVE, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Executive Towers

 

Executive Towers I

 

Office

 

 

2,652

 

24,464

 

2,899

 

2,652

 

27,363

 

30,015

 

3,895

 

1983

 

1997

 

Executive Towers

 

Executive Towers II

 

Office

 

 

3,386

 

31,876

 

5,389

 

3,386

 

37,265

 

40,651

 

5,822

 

1984

 

1997

 

Executive Towers

 

Executive Towers III

 

Office

 

 

3,512

 

32,989

 

2,688

 

3,512

 

35,676

 

39,188

 

5,227

 

1987

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DUBLIN, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Scioto Corporate Center

 

Scioto Corporate Center

 

Office

 

 

1,100

 

3,350

 

771

 

1,100

 

4,121

 

5,221

 

670

 

1987

 

1996

 

Tuttle Crossing

 

Metrocenter III

 

Office

 

 

887

 

3,012

 

436

 

887

 

3,448

 

4,334

 

562

 

1983

 

1996

 

Tuttle Crossing

 

Qwest (LCI)

 

Office

 

 

2,618

 

18,942

 

931

 

2,670

 

19,821

 

22,491

 

4,559

 

1990

 

1993

 

Tuttle Crossing

 

Sterling 1

 

Office

 

 

1,494

 

12,858

 

331

 

1,524

 

13,159

 

14,683

 

2,983

 

1990

 

1993

 

Tuttle Crossing

 

4700 Lakehurst Ct.

 

Office

 

 

717

 

2,463

 

405

 

717

 

2,868

 

3,585

 

793

 

1994

 

1994

 

Tuttle Crossing

 

Sterling 2

 

Office

 

 

605

 

5,873

 

71

 

605

 

5,944

 

6,549

 

1,124

 

1995

 

1995

 

Tuttle Crossing

 

John Alden Life Ins.

 

Office

 

 

1,066

 

7,711

 

31

 

1,066

 

7,743

 

8,809

 

1,444

 

1995

 

1995

 

Tuttle Crossing

 

5555 Glendon Court

 

Office

 

 

1,600

 

10,864

 

1,093

 

1,773

 

11,783

 

13,557

 

4,256

 

1995

 

1995

 

Tuttle Crossing

 

Sterling 3

 

Office

 

 

1,601

 

8,725

 

71

 

1,601

 

8,796

 

10,397

 

2,229

 

1996

 

1996

 

Tuttle Crossing

 

Compmanagement

 

Office

 

 

867

 

4,408

 

545

 

867

 

4,953

 

5,820

 

848

 

1997

 

1997

 

Tuttle Crossing

 

Sterling 4

 

Office

 

 

483

 

9,349

 

892

 

483

 

10,242

 

10,725

 

1,661

 

1998

 

1998

 

Tuttle Crossing

 

Xerox Bldg-5555 Parkcenter Cir

 

Office

 

 

1,580

 

9,375

 

449

 

1,580

 

9,824

 

11,404

 

2,203

 

1992

 

1994

 

Tuttle Crossing

 

Parkwood Place

 

Office

 

 

1,690

 

11,570

 

847

 

1,690

 

12,417

 

14,106

 

2,390

 

1997

 

1997

 

Tuttle Crossing

 

Nationwide

 

Office

 

 

4,815

 

19,199

 

96

 

4,815

 

19,295

 

24,110

 

4,872

 

1996

 

1996

 

Tuttle Crossing

 

Emerald II

 

Office

 

 

495

 

3,399

 

17

 

495

 

3,416

 

3,911

 

832

 

1998

 

1998

 

Tuttle Crossing

 

Atrium II, Phase I

 

Office

 

 

1,649

 

11,523

 

1

 

1,649

 

11,524

 

13,173

 

2,890

 

1997

 

1998

 

Tuttle Crossing

 

Atrium II, Phase II

 

Office

 

 

1,597

 

10,292

 

904

 

1,597

 

11,196

 

12,793

 

2,680

 

1998

 

1999

 

Tuttle Crossing

 

Blazer I

 

Office

 

 

904

 

5,728

 

579

 

904

 

6,308

 

7,212

 

1,417

 

1999

 

1999

 

Tuttle Crossing

 

Parkwood II

 

Office

 

 

1,848

 

14,030

 

45

 

1,848

 

14,075

 

15,923

 

1,405

 

2000

 

2000

 

 

54



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tuttle Crossing

 

Blazer II

 

Office

 

 

1,016

 

6,901

 

17

 

1,016

 

6,917

 

7,934

 

720

 

2000

 

2000

 

Tuttle Crossing

 

Emerald III

 

Office

 

 

1,685

 

9,862

 

 

1,685

 

9,862

 

11,547

 

427

 

2001

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DULUTH, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Breckinridge

 

2825 Breckinridge Blvd

 

Industrial

 

 

317

 

3,626

 

208

 

317

 

3,833

 

4,151

 

394

 

1986

 

1999

 

Breckinridge

 

2875 Breckinridge Blvd

 

Industrial

 

 

476

 

4,797

 

11

 

476

 

4,807

 

5,284

 

417

 

1986

 

1999

 

Breckinridge

 

2885 Breckinridge Blvd

 

Industrial

 

 

487

 

6,893

 

563

 

487

 

7,456

 

7,942

 

733

 

1997

 

1999

 

Business Park At Sugarloaf

 

2775 Premiere Parkway

 

Industrial

 

 

560

 

4,697

 

21

 

560

 

4,719

 

5,279

 

417

 

1997

 

1999

 

Business Park At Sugarloaf

 

3079 Premiere Parkway

 

Industrial

 

 

776

 

6,520

 

381

 

776

 

6,902

 

7,678

 

625

 

1998

 

1999

 

Business Park At Sugarloaf

 

Sugarloaf Office I

 

Industrial

 

 

1,042

 

8,685

 

275

 

1,042

 

8,960

 

10,002

 

797

 

1998

 

1999

 

Business Park At Sugarloaf

 

Sugarloaf Office II

 

Industrial

 

 

 

972

 

3,842

 

 

972

 

3,842

 

4,814

 

21

 

1999

 

2002

 

Business Park At Sugarloaf

 

Sugarloaf Office III

 

Industrial

 

 

 

696

 

3,896

 

 

696

 

3,896

 

4,591

 

20

 

1999

 

2002

 

Business Park At Sugarloaf

 

Sugarloaf Office IV

 

Industrial

 

 

623

 

4,182

 

10

 

623

 

4,192

 

4,816

 

824

 

2000

 

2000

 

Business Park At Sugarloaf

 

Sugarloaf Office V

 

Industrial

 

 

 

744

 

3,958

 

 

744

 

3,958

 

4,702

 

349

 

2001

 

2001

 

Business Park At Sugarloaf

 

2850 Premiere Parkway

 

Industrial

 

 

 

621

 

4,698

 

 

621

 

4,698

 

5,319

 

19

 

1997

 

2002

 

Business Park At Sugarloaf

 

2855 Premiere Parkway

 

Industrial

 

 

765

 

3,959

 

186

 

765

 

4,145

 

4,911

 

444

 

1999

 

1999

 

Business Park At Sugarloaf

 

6655 Sugarloaf

 

Industrial

 

 

1,651

 

6,449

 

4

 

1,651

 

6,453

 

8,104

 

175

 

1998

 

2001

 

Crestwood Pointe

 

3805 Crestwood Parkway

 

Office

 

 

877

 

15,158

 

244

 

877

 

15,403

 

16,279

 

1,356

 

1997

 

1999

 

Crestwood Pointe

 

3885 Crestwood Parkway

 

Office

 

 

878

 

14,153

 

958

 

878

 

15,110

 

15,988

 

1,777

 

1998

 

1999

 

Hampton Green

 

Hampton Green Off I

 

Office

 

 

1,388

 

12,361

 

 

1,388

 

12,361

 

13,748

 

772

 

2000

 

2000

 

Meadowbrook

 

2475 Meadowbrook Parkway

 

Industrial

 

 

529

 

3,477

 

78

 

529

 

3,555

 

4,084

 

307

 

1986

 

1999

 

Meadowbrook

 

2505 Meadowbrook Parkway

 

Industrial

 

 

606

 

1,555

 

4

 

606

 

1,559

 

2,165

 

209

 

1990

 

1999

 

River Green

 

3450 River Green Court

 

Industrial

 

 

194

 

2,191

 

195

 

194

 

2,386

 

2,580

 

260

 

1989

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EAGAN, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Apollo Distribution Center

 

Apollo Industrial Ctr I

 

Industrial

 

 

866

 

4,976

 

737

 

882

 

5,698

 

6,579

 

745

 

1997

 

1997

 

Apollo Distribution Center

 

Apollo Industrial Ctr II

 

Industrial

 

 

474

 

3,142

 

 

474

 

3,142

 

3,616

 

407

 

2000

 

2000

 

Apollo Distribution Center

 

Apollo Industrial Ctr III

 

Industrial

 

 

1,432

 

6,905

 

 

1,432

 

6,905

 

8,337

 

509

 

2000

 

2000

 

Eagandale Crossing

 

Eagandale Crossing

 

Industrial

 

 

974

 

4,818

 

10

 

987

 

4,815

 

5,802

 

1,519

 

1998

 

1998

 

Eagandale Tech Center

 

Eagandale Tech Center

 

Industrial

 

 

987

 

5,709

 

1,023

 

997

 

6,721

 

7,719

 

1,193

 

1998

 

1998

 

Lunar Pointe

 

Lunar Pointe

 

Industrial

 

 

 

982

 

4,448

 

 

982

 

4,448

 

5,430

 

209

 

2001

 

2001

 

Sibley Industrial Center

 

Sibley Industrial Center I

 

Industrial

 

 

356

 

2,050

 

234

 

380

 

2,260

 

2,639

 

327

 

1973

 

1997

 

Sibley Industrial Center

 

Sibley Industrial Center II

 

Industrial

 

 

225

 

1,197

 

105

 

225

 

1,301

 

1,526

 

231

 

1972

 

1997

 

Sibley Industrial Center

 

Sibley Industrial Center III

 

Industrial

 

 

213

 

1,223

 

251

 

217

 

1,470

 

1,687

 

225

 

1968

 

1997

 

Silverbell Commons

 

Silverbell Commons

 

Industrial

 

 

1,807

 

6,804

 

256

 

1,807

 

7,060

 

8,867

 

907

 

1999

 

1999

 

Trapp Road

 

Trapp Road Commerce I

 

Industrial

 

 

671

 

3,893

 

367

 

700

 

4,231

 

4,931

 

619

 

1996

 

1998

 

Trapp Road

 

Trapp Road Commerce II

 

Industrial

 

 

1,250

 

7,022

 

490

 

1,266

 

7,496

 

8,762

 

1,096

 

1998

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARTH CITY, MISSOURI

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earth City

 

3322 NGIC

 

Office

 

6,311

 

2,615

 

10,877

 

811

 

2,615

 

11,688

 

14,303

 

1,737

 

1987

 

1997

 

Earth City

 

Corporate Center, Earth City

 

Industrial

 

 

783

 

4,517

 

693

 

783

 

5,210

 

5,993

 

594

 

2000

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EAST POINTE, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Camp Creek

 

Camp Creek Bldg 1400

 

Industrial

 

 

561

 

3,398

 

 

561

 

3,398

 

3,959

 

167

 

1988

 

2001

 

Camp Creek

 

Camp Creek Bldg 1800

 

Industrial

 

 

462

 

3,022

 

 

462

 

3,022

 

3,484

 

232

 

1989

 

2001

 

Camp Creek

 

Camp Creek Bldg 2000

 

Industrial

 

 

395

 

2,292

 

 

395

 

2,292

 

2,688

 

114

 

1989

 

2001

 

Camp Creek

 

Camp Creek Bldg 2400

 

Industrial

 

 

296

 

1,840

 

 

296

 

1,840

 

2,135

 

114

 

1988

 

2001

 

Camp Creek

 

Camp Creek Bldg 2600

 

Industrial

 

 

364

 

2,346

 

 

364

 

2,346

 

2,710

 

127

 

1990

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EDEN PRAIRIE, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Edenvale Executive Center

 

Edenvale Executive Center

 

Industrial

 

 

1,184

 

6,734

 

486

 

1,185

 

7,220

 

8,404

 

676

 

1987

 

1999

 

Golden Triangle Tech Center

 

Golden Triangle Tech Ctr

 

Industrial

 

 

1,446

 

8,284

 

268

 

1,458

 

8,540

 

9,998

 

974

 

1997

 

1998

 

Valley Gate/Green

 

Valley Gate North

 

Industrial

 

 

548

 

3,133

 

553

 

556

 

3,678

 

4,234

 

431

 

1986

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EDINA, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

55



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cahill Business Center

 

Cahill Business Center

 

Industrial

 

 

507

 

2,963

 

361

 

507

 

3,324

 

3,831

 

557

 

1980

 

1997

 

Edina Interchange

 

Edina Interchange I

 

Industrial

 

1,630

 

630

 

3,660

 

411

 

630

 

4,071

 

4,701

 

606

 

1995

 

1997

 

Edina Interchange

 

Edina Interchange II

 

Industrial

 

1,044

 

432

 

2,512

 

65

 

432

 

2,577

 

3,010

 

325

 

1980

 

1997

 

Edina Interchange

 

Edina Interchange III

 

Industrial

 

1,176

 

487

 

2,833

 

71

 

487

 

2,904

 

3,391

 

370

 

1981

 

1997

 

Edina Interchange

 

Edina Interchange IV

 

Industrial

 

 

228

 

1,322

 

367

 

228

 

1,690

 

1,917

 

345

 

1974

 

1997

 

Edina Interchange

 

Edina Interchange V

 

Industrial

 

 

971

 

5,666

 

368

 

971

 

6,034

 

7,005

 

878

 

1974

 

1997

 

Edina Interchange

 

Edina Interchange VII

 

Industrial

 

 

180

 

1,060

 

241

 

180

 

1,300

 

1,480

 

220

 

1970

 

1998

 

Pakwa

 

Pakwa I

 

Industrial

 

 

347

 

2,029

 

359

 

347

 

2,388

 

2,735

 

428

 

1979

 

1997

 

Pakwa

 

Pakwa II

 

Industrial

 

 

215

 

1,241

 

182

 

215

 

1,423

 

1,637

 

200

 

1979

 

1997

 

Pakwa

 

Pakwa III

 

Office

 

 

248

 

1,433

 

117

 

248

 

1,549

 

1,798

 

216

 

1979

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FAIRFIELD, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Faifield Business Center

 

Fairfield Bus. Ctr. D

 

Industrial

 

 

135

 

1,744

 

134

 

135

 

1,878

 

2,012

 

348

 

1990

 

1995

 

Faifield Business Center

 

Fairfield Bus. Ctr. E

 

Industrial

 

 

398

 

2,594

 

88

 

398

 

2,682

 

3,080

 

514

 

1990

 

1995

 

University Moving

 

Thunderbird Bldg 1

 

Industrial

 

 

248

 

1,760

 

24

 

248

 

1,784

 

2,031

 

340

 

1991

 

1995

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FENTON, MISSOURI

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fenton Interstate Buildings

 

Fenton Interstate Building C

 

Industrial

 

 

519

 

1,978

 

37

 

519

 

2,014

 

2,534

 

173

 

1986

 

1999

 

Fenton Interstate Buildings

 

Fenton Interstate Building D

 

Industrial

 

 

1,286

 

5,178

 

160

 

1,286

 

5,338

 

6,624

 

544

 

1987

 

1999

 

Fenton Interstate Buildings

 

Fenton Industrial Bldg A

 

Industrial

 

 

603

 

2,622

 

 

603

 

2,622

 

3,225

 

224

 

1987

 

2000

 

Fenton Interstate Buildings

 

Fenton Industrial Bldg B

 

Industrial

 

 

702

 

2,319

 

 

702

 

2,319

 

3,022

 

155

 

1986

 

2000

 

Southport

 

Southport I

 

Industrial

 

 

192

 

834

 

45

 

192

 

878

 

1,070

 

117

 

1977

 

1997

 

Southport

 

Southport II

 

Industrial

 

 

151

 

659

 

49

 

151

 

709

 

860

 

102

 

1978

 

1997

 

Southport

 

Southport Commerce Ctr

 

Industrial

 

 

233

 

1,016

 

173

 

233

 

1,189

 

1,422

 

197

 

1978

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FISHERS, INDIANA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exit 5

 

Exit 5 Bldg I

 

Industrial

 

 

833

 

2,695

 

113

 

833

 

2,807

 

3,641

 

269

 

1999

 

1999

 

Exit 5

 

Exit 5 Bldg. II

 

Industrial

 

 

760

 

4,611

 

203

 

760

 

4,815

 

5,575

 

594

 

1999

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FLORENCE, KENTUCKY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Florence

 

Sofa Express - Florence

 

Retail

 

 

735

 

781

 

342

 

735

 

1,124

 

1,859

 

150

 

1997

 

1997

 

Florence

 

Turfway Crossing

 

Retail

 

 

 

4,664

 

4,725

 

 

4,664

 

4,725

 

9,389

 

 

2001

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FRANKLIN, TENNESSEE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aspen Grove Business Center

 

277 Mallory Station

 

Industrial

 

 

936

 

6,539

 

69

 

936

 

6,608

 

7,544

 

581

 

1996

 

1999

 

Aspen Grove Business Center

 

320 Premier Court

 

Industrial

 

 

1,151

 

6,521

 

347

 

1,151

 

6,869

 

8,019

 

610

 

1996

 

1999

 

Aspen Grove Business Center

 

305 Seaboard Lane

 

Industrial

 

 

970

 

6,318

 

566

 

970

 

6,884

 

7,854

 

1,189

 

1998

 

1999

 

Aspen Grove Business Center

 

Aspen Grove 4

 

Industrial

 

 

492

 

2,416

 

 

492

 

2,416

 

2,908

 

32

 

2002

 

2002

 

Aspen Grove Business Center

 

416 Mary Lindsay Polk Dr

 

Industrial

 

 

943

 

5,288

 

699

 

943

 

5,987

 

6,930

 

604

 

1996

 

1999

 

Aspen Grove Business Center

 

318 Seaboard Lane Bldg 200

 

Industrial

 

 

240

 

1,385

 

555

 

240

 

1,940

 

2,180

 

336

 

1999

 

1999

 

Aspen Grove Business Center

 

341 Cool Springs Blvd

 

Office

 

 

950

 

7,468

 

1,600

 

950

 

9,069

 

10,018

 

1,105

 

1999

 

1999

 

Aspen Grove Business Center

 

318 Seaboard Lane Bldg 100

 

Industrial

 

 

301

 

1,684

 

755

 

301

 

2,439

 

2,740

 

522

 

1999

 

1999

 

Aspen Grove Business Center

 

Aspen Grove Flex Ctr III

 

Industrial

 

 

 

327

 

2,027

 

 

327

 

2,027

 

2,354

 

15

 

2001

 

2001

 

Aspen Grove Business Center

 

Aspen Grove Flex Ctr IV

 

Industrial

 

 

 

205

 

1,528

 

 

205

 

1,528

 

1,733

 

115

 

2001

 

2001

 

Brentwood South Bus. Center

 

119 Seaboard Lane

 

Industrial

 

 

569

 

2,435

 

22

 

569

 

2,457

 

3,027

 

213

 

1990

 

1999

 

Brentwood South Bus. Center

 

121 Seaboard Lane

 

Industrial

 

 

445

 

1,932

 

12

 

445

 

1,944

 

2,389

 

179

 

1990

 

1999

 

Brentwood South Bus. Center

 

123 Seaboard Lane

 

Industrial

 

 

489

 

1,243

 

407

 

489

 

1,651

 

2,139

 

156

 

1990

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FRIDLEY, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

River Road

 

River Road Business Ctr. S.

 

Industrial

 

3,510

 

1,083

 

6,379

 

427

 

1,112

 

6,777

 

7,889

 

815

 

1986

 

1999

 

University Center

 

University Center I&II

 

Industrial

 

 

220

 

1,273

 

354

 

226

 

1,620

 

1,847

 

164

 

1983

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FT. LAUDERDALE, FLORIDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sawgrass

 

Sawgrass - Building 1

 

Office

 

 

1,211

 

6,424

 

75

 

1,211

 

6,499

 

7,710

 

1,041

 

1999

 

2000

 

 

56



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

GLENWILLOW, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Emerald Valley

 

Emerald Valley Bldg 1

 

Industrial

 

 

555

 

6,398

 

132

 

556

 

6,529

 

7,085

 

497

 

1999

 

1999

 

Emerald Valley

 

Emerald Valley Bldg 2

 

Industrial

 

 

 

519

 

5,052

 

 

519

 

5,052

 

5,571

 

245

 

2001

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GOLDEN VALLEY, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Edina Realty

 

Edina Realty

 

Office

 

 

330

 

1,282

 

186

 

349

 

1,449

 

1,798

 

231

 

1965

 

1998

 

Golden Hills

 

Golden Hills 1

 

Industrial

 

 

1,081

 

6,281

 

249

 

1,105

 

6,506

 

7,611

 

749

 

1996

 

1998

 

Golden Hills

 

Golden Hills 2

 

Industrial

 

 

1,741

 

4,315

 

388

 

1,742

 

4,703

 

6,444

 

1,068

 

1999

 

1999

 

Golden Hills

 

Golden Hills 3

 

Industrial

 

 

1,813

 

4,845

 

366

 

1,815

 

5,210

 

7,024

 

1,008

 

1999

 

1999

 

5075 Building

 

5075 Building

 

Office

 

 

506

 

2,389

 

356

 

539

 

2,711

 

3,251

 

390

 

1965

 

1998

 

Tyrol West

 

Tyrol West

 

Office

 

 

350

 

2,016

 

348

 

380

 

2,334

 

2,714

 

326

 

1968

 

1998

 

Sandburg Industrial Center

 

Sandburg Industrial Center

 

Industrial

 

 

451

 

2,629

 

415

 

451

 

3,044

 

3,495

 

357

 

1973

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GREENWOOD, INDIANA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

South Park-Indiana

 

South Park Bldg 1

 

Office

 

 

287

 

2,577

 

325

 

292

 

2,897

 

3,189

 

656

 

1989

 

1993

 

South Park-Indiana

 

South Park Bldg 2

 

Industrial

 

 

334

 

3,424

 

708

 

341

 

4,125

 

4,465

 

1,118

 

1990

 

1993

 

South Park-Indiana

 

South Park Bldg 3

 

Office

 

 

208

 

2,378

 

319

 

212

 

2,693

 

2,905

 

709

 

1990

 

1993

 

South Park-Indiana

 

Brylane Parking Lot

 

Grounds

 

 

54

 

 

3

 

57

 

 

57

 

 

 

 

1994

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GROVE CITY, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

South Pointe

 

South Pointe Bldg D

 

Industrial

 

 

276

 

3,176

 

323

 

276

 

3,500

 

3,776

 

713

 

1997

 

1997

 

South Pointe

 

South Pointe Bldg E

 

Industrial

 

 

279

 

2,450

 

920

 

279

 

3,371

 

3,649

 

826

 

1997

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GROVEPORT, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6600 Port Road

 

6600 Port Road

 

Industrial

 

 

2,725

 

23,547

 

145

 

2,725

 

23,691

 

26,417

 

3,524

 

1995

 

1997

 

Groveport Commerce Ctr

 

Groveport Comm Ctr #2

 

Industrial

 

 

1,049

 

7,610

 

1,015

 

1,049

 

8,625

 

9,674

 

905

 

1999

 

1999

 

Groveport Commerce Ctr

 

Groveport Comm Ctr #3

 

Industrial

 

 

510

 

3,886

 

218

 

510

 

4,104

 

4,614

 

294

 

1999

 

2000

 

Groveport Commerce Ctr

 

Groveport Comm Ctr #4

 

Industrial

 

 

1,114

 

8,687

 

8

 

1,114

 

8,695

 

9,809

 

623

 

2000

 

2000

 

Groveport Commerce Ctr

 

Groveport Commerce Ctr. #345

 

Industrial

 

 

1,045

 

7,349

 

555

 

1,045

 

7,904

 

8,949

 

417

 

2000

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HEBRON, KENTUCKY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

KY, Southpark

 

Ky. Southpark Bldg 4

 

Industrial

 

 

779

 

3,372

 

38

 

779

 

3,410

 

4,189

 

712

 

1994

 

1994

 

KY, Southpark

 

CR Services

 

Industrial

 

 

1,085

 

4,214

 

1,186

 

1,085

 

5,400

 

6,485

 

1,121

 

1994

 

1994

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HIGHLAND HEIGHTS, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Avion Park

 

5335 Avion Park Drive

 

Industrial

 

 

 

606

 

2,534

 

 

606

 

2,534

 

3,140

 

43

 

1994

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HOPKINS, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cornerstone Business Center

 

Cornerstone Business Center

 

Industrial

 

5,949

 

1,469

 

8,455

 

239

 

1,543

 

8,620

 

10,163

 

1,096

 

1996

 

1997

 

Westside Business Park

 

Westside Business Park

 

Industrial

 

 

1,176

 

6,842

 

586

 

1,170

 

7,434

 

8,604

 

1,036

 

1987

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INDEPENDENCE, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6111 Oak Tree

 

Oak Tree Place

 

Office

 

 

703

 

4,667

 

469

 

703

 

5,136

 

5,839

 

832

 

1979

 

1997

 

Corporate Plaza

 

Corporate Plaza I

 

Office

 

7,842

 

2,116

 

14,224

 

710

 

2,116

 

14,934

 

17,049

 

2,700

 

1989

 

1996

 

Corporate Plaza

 

Corporate Plaza II

 

Office

 

6,887

 

1,841

 

12,387

 

746

 

1,841

 

13,133

 

14,974

 

2,435

 

1991

 

1996

 

Freedom Square

 

Freedom Square I

 

Office

 

 

595

 

3,994

 

345

 

595

 

4,339

 

4,934

 

800

 

1980

 

1996

 

Freedom Square

 

Freedom Square II

 

Office

 

6,580

 

1,746

 

11,774

 

787

 

1,746

 

12,560

 

14,306

 

2,313

 

1987

 

1996

 

Freedom Square

 

Freedom Square III

 

Office

 

 

701

 

6,536

 

78

 

701

 

6,613

 

7,315

 

1,581

 

1997

 

1997

 

Park Center

 

Park Center Bldg I

 

Office

 

 

2,193

 

13,968

 

125

 

2,193

 

14,092

 

16,285

 

2,800

 

1998

 

1998

 

Park Center

 

Park Center Bldg II

 

Office

 

 

2,190

 

13,722

 

201

 

2,190

 

13,922

 

16,112

 

2,144

 

1999

 

1999

 

Park Center

 

Park Center Bldg III

 

Office

 

 

2,190

 

12,812

 

396

 

2,190

 

13,208

 

15,398

 

1,213

 

2000

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INDIANAPOLIS, INDIANA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Road Business Park

 

Franklin Road Bus. Ctr.

 

Industrial

 

 

594

 

10,743

 

74

 

594

 

10,817

 

11,411

 

2,379

 

1962

 

1995

 

Hillsdale

 

Hillsdale Bldg 4

 

Industrial

 

 

366

 

5,122

 

232

 

366

 

5,354

 

5,720

 

1,207

 

1987

 

1993

 

 

57



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

Hillsdale

 

Hillsdale Bldg 5

 

Industrial

 

 

251

 

3,250

 

631

 

251

 

3,882

 

4,133

 

925

 

1987

 

1993

 

Hillsdale

 

Hillsdale Bldg 6

 

Industrial

 

 

315

 

4,334

 

1,239

 

315

 

5,573

 

5,888

 

1,043

 

1987

 

1993

 

KATC - North

 

3520 Commerce Crossing

 

Office

 

 

950

 

2,063

 

36

 

950

 

2,099

 

3,049

 

444

 

1976

 

1993

 

KATC - South

 

8465 Keystone Crossing

 

Office

 

 

89

 

1,381

 

173

 

89

 

1,554

 

1,643

 

308

 

1983

 

1995

 

KATC - South

 

F.C. Tucker

 

Office

 

 

 

290

 

7

 

 

297

 

297

 

65

 

1978

 

1993

 

Keystone Crossing

 

8555 Keystone Crossing

 

Office

 

 

 

6,038

 

515

 

 

6,553

 

6,553

 

1,019

 

1985

 

1997

 

Nampac Building

 

6061 Guion Rd

 

Industrial

 

 

274

 

1,798

 

124

 

274

 

1,922

 

2,196

 

386

 

1974

 

1995

 

4750 Kentucky Avenue

 

4750 Kentucky Avenue

 

Industrial

 

 

246

 

2,383

 

220

 

246

 

2,604

 

2,849

 

400

 

1974

 

1996

 

Software Artistry

 

River Road Bldg I

 

Office

 

 

856

 

7,727

 

116

 

856

 

7,843

 

8,699

 

1,365

 

1997

 

1998

 

4316 West Minnesota

 

4316 West Minnesota

 

Industrial

 

 

287

 

2,283

 

294

 

287

 

2,577

 

2,864

 

396

 

1970

 

1996

 

One North Capital

 

One North Capital

 

Office

 

 

 

1,439

 

9,651

 

 

1,439

 

9,651

 

11,091

 

1,059

 

1980

 

1998

 

Park 100

 

6060 Guion Rd

 

Industrial

 

 

411

 

2,856

 

810

 

511

 

3,566

 

4,076

 

733

 

1968

 

1996

 

Park 100

 

Silver Burdett

 

Industrial

 

 

1,414

 

13,835

 

725

 

1,667

 

14,307

 

15,974

 

3,202

 

1994

 

1995

 

Park 100

 

Park 100 Bldg 98

 

Industrial

 

 

273

 

8,296

 

1,347

 

273

 

9,643

 

9,916

 

1,754

 

1968

 

1994

 

Park 100

 

Park 100 Bldg 100

 

Industrial

 

1,457

 

103

 

2,471

 

595

 

103

 

3,065

 

3,168

 

764

 

1995

 

1995

 

Park 100

 

Park 100 Bldg 107

 

Industrial

 

 

99

 

1,698

 

51

 

99

 

1,750

 

1,848

 

334

 

1984

 

1995

 

Park 100

 

Park 100 Bldg 109

 

Industrial

 

965

 

240

 

1,845

 

12

 

246

 

1,851

 

2,097

 

738

 

1985

 

1986

 

Park 100

 

Park 100 Bldg 116

 

Office

 

 

341

 

3,215

 

59

 

348

 

3,267

 

3,615

 

1,153

 

1988

 

1988

 

Park 100

 

Park 100 Bldg 118

 

Office

 

 

226

 

2,427

 

390

 

230

 

2,813

 

3,043

 

642

 

1988

 

1993

 

Park 100

 

Park 100 Bldg 119

 

Office

 

 

388

 

3,719

 

1,205

 

395

 

4,917

 

5,312

 

1,076

 

1989

 

1993

 

Park 100

 

Park 100 Bldg 121, Retail

 

Retail

 

 

592

 

1,074

 

128

 

604

 

1,190

 

1,794

 

247

 

1989

 

1993

 

Park 100

 

Park 100 Bldg 122

 

Industrial

 

 

284

 

3,744

 

225

 

290

 

3,963

 

4,253

 

932

 

1990

 

1993

 

Park 100

 

Park 100 Bldg 124

 

Office

 

 

 

227

 

2,852

 

 

227

 

2,852

 

3,079

 

67

 

1992

 

2002

 

Park 100

 

Park 100 Bldg 127

 

Industrial

 

 

96

 

1,934

 

298

 

96

 

2,232

 

2,328

 

540

 

1995

 

1995

 

Park 100

 

Park 100 Bldg 132

 

Office

 

 

446

 

1,217

 

456

 

446

 

1,673

 

2,119

 

497

 

1997

 

1997

 

Park 100

 

Norco Windows Parking Lot

 

Grounds

 

 

37

 

 

 

37

 

 

37

 

 

 

 

1999

 

Park 100

 

Ups Parking

 

Grounds

 

 

270

 

 

 

270

 

 

270

 

 

 

 

1997

 

Park 100

 

Norgate Ground Lease

 

Grounds

 

 

51

 

 

 

51

 

 

51

 

 

 

 

1995

 

Park 100

 

Zollman Ground Lease

 

Grounds

 

 

115

 

 

 

115

 

 

115

 

 

 

 

1994

 

Park 100

 

Becton Dickinson Lot

 

Grounds

 

 

 

 

13

 

13

 

 

13

 

 

 

 

1993

 

Park Fletcher

 

Park Fletcher Bldg 14

 

Industrial

 

 

76

 

740

 

65

 

76

 

805

 

881

 

135

 

1978

 

1996

 

Parkwood Crossing

 

One Parkwood

 

Office

 

 

1,018

 

10,212

 

217

 

1,028

 

10,419

 

11,446

 

1,805

 

1989

 

1995

 

Parkwood Crossing

 

Two Parkwood

 

Office

 

 

861

 

7,652

 

25

 

871

 

7,667

 

8,539

 

2,099

 

1996

 

1996

 

Parkwood Crossing

 

Three Parkwood

 

Office

 

 

1,377

 

9,777

 

355

 

1,387

 

10,122

 

11,509

 

2,136

 

1997

 

1997

 

Parkwood Crossing

 

Four Parkwood

 

Office

 

 

1,489

 

11,709

 

673

 

1,499

 

12,371

 

13,870

 

2,753

 

1998

 

1998

 

Parkwood Crossing

 

Five Parkwood

 

Office

 

 

1,485

 

13,641

 

516

 

1,528

 

14,113

 

15,641

 

2,314

 

1999

 

1999

 

Parkwood Crossing

 

Six Parkwood

 

Office

 

 

1,960

 

15,580

 

378

 

1,960

 

15,957

 

17,918

 

1,495

 

2000

 

2000

 

Parkwood Crossing

 

Duke Fitness Centers LLC

 

Grounds

 

 

 

 

61

 

 

 

61

 

61

 

 

 

 

2002

 

Woodfield

 

Two Woodfield Crossing

 

Office

 

 

719

 

9,480

 

1,236

 

733

 

10,702

 

11,435

 

2,572

 

1987

 

1993

 

Woodfield

 

Three Woodfield Crossing

 

Office

 

 

3,767

 

21,236

 

2,912

 

3,843

 

24,073

 

27,916

 

5,830

 

1989

 

1993

 

Woodland Corporate Park

 

Woodland Corporate Park I

 

Office

 

 

290

 

4,598

 

602

 

320

 

5,170

 

5,490

 

1,032

 

1998

 

1998

 

Woodland Corporate Park

 

Woodland Corporate Park II

 

Office

 

 

271

 

3,618

 

818

 

297

 

4,410

 

4,707

 

543

 

1999

 

1999

 

Woodland Corporate Park

 

Woodland Corporate Park III

 

Office

 

 

1,227

 

4,432

 

71

 

1,227

 

4,504

 

5,730

 

499

 

1999

 

2000

 

Woodland Corporate Park

 

Woodland Corporate Park IV

 

Office

 

 

715

 

7,245

 

144

 

715

 

7,389

 

8,104

 

558

 

2000

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

JACKSONVILLE, FLORIDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7011 A.C. Skinner Pkwy

 

7011 A.C. Skinner Pkwy

 

Office

 

 

1,007

 

4,200

 

 

1,007

 

4,200

 

5,207

 

485

 

1999

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

KENNESAW, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Town Point

 

3391 Town Point Drive

 

Office

 

 

797

 

8,425

 

1,124

 

797

 

9,549

 

10,346

 

1,332

 

1999

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LAKE FOREST, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bradley Business Center

 

Ballard Drive Building

 

Industrial

 

 

186

 

1,751

 

89

 

186

 

1,840

 

2,026

 

235

 

1985

 

1998

 

Bradley Business Center

 

Laurel Drive Building

 

Industrial

 

 

98

 

913

 

53

 

98

 

965

 

1,064

 

116

 

1981

 

1998

 

Bradley Business Center

 

13825 W. Laurel Dr.

 

Industrial

 

 

750

 

1,874

 

816

 

750

 

2,690

 

3,440

 

294

 

1978

 

1999

 

 

58



 

Development

 

Name

 

Building
Type

 

Encumbrances

 





 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

Conway Park

 

One Conway Park

 

Office

 

 

1,901

 

18,370

 

1,136

 

1,901

 

19,506

 

21,407

 

2,633

 

1989

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LAKE MARY, FLORIDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Northpoint

 

Northpoint Center I

 

Office

 

 

1,087

 

11,546

 

155

 

1,087

 

11,701

 

12,788

 

1,912

 

1998

 

1999

 

Northpoint

 

Northpoint Center II

 

Office

 

 

1,202

 

10,891

 

103

 

1,202

 

10,994

 

12,196

 

1,237

 

1999

 

2000

 

Northpoint

 

Northpoint III

 

Office

 

 

1,552

 

10,987

 

 

1,552

 

10,987

 

12,539

 

411

 

2001

 

2001

 

Northpoint

 

Northpoint IV

 

Office

 

 

 

1,605

 

8,583

 

 

1,605

 

8,583

 

10,187

 

254

 

2002

 

2002

 

Technology Park

 

Technology Park I

 

Industrial

 

 

641

 

3,519

 

205

 

641

 

3,725

 

4,366

 

368

 

1986

 

1999

 

Technology Park

 

Technology Park II

 

Industrial

 

 

835

 

4,306

 

277

 

835

 

4,582

 

5,417

 

434

 

1998

 

1999

 

Technology Park

 

Technology Park III

 

Industrial

 

 

477

 

3,859

 

113

 

477

 

3,972

 

4,449

 

392

 

1998

 

1999

 

Technology Park

 

Technology Park IV

 

Industrial

 

 

669

 

2,905

 

285

 

669

 

3,190

 

3,859

 

331

 

1999

 

1999

 

Technology Park

 

Technology Park V

 

Industrial

 

 

547

 

2,878

 

244

 

547

 

3,121

 

3,669

 

289

 

1999

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LAKELAND, FLORIDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lakeland Interstate Park

 

Lakeland Interstate Park I

 

Industrial

 

 

864

 

4,263

 

 

864

 

4,263

 

5,127

 

131

 

2001

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LAWRENCEVILLE, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hillside at Huntcrest

 

Huntcrest I

 

Office

 

 

1,193

 

9,897

 

 

1,193

 

9,897

 

11,089

 

543

 

2000

 

2001

 

Hillside at Huntcrest

 

Huntcrest II

 

Office

 

 

927

 

10,562

 

 

927

 

10,562

 

11,489

 

709

 

2000

 

2001

 

Hillside at Huntcrest

 

Huntcrest III

 

Office

 

 

1,358

 

9,535

 

 

1,358

 

9,535

 

10,893

 

 

2001

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LEBANON, INDIANA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lebanon Bus. Park

 

Lebanon Building 4

 

Industrial

 

 

305

 

9,672

 

89

 

305

 

9,760

 

10,066

 

1,245

 

1997

 

1997

 

Lebanon Bus. Park

 

Lebanon Building 9

 

Industrial

 

 

554

 

6,891

 

644

 

554

 

7,535

 

8,089

 

617

 

1999

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LEWIS CENTER, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Orange Point Commerce Park

 

Orange Point #73

 

Industrial

 

 

551

 

3,274

 

 

551

 

3,274

 

3,825

 

155

 

2001

 

2001

 

Orange Point Commerce Park

 

Orange Point 144

 

Industrial

 

 

886

 

4,955

 

 

886

 

4,955

 

5,841

 

243

 

2001

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MARIETTA, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Franklin Forest

 

805 Franklin Court

 

Industrial

 

 

313

 

1,932

 

46

 

313

 

1,977

 

2,291

 

177

 

1983

 

1999

 

Franklin Forest

 

810 Franklin Court

 

Industrial

 

 

255

 

1,653

 

68

 

255

 

1,721

 

1,976

 

174

 

1983

 

1999

 

Franklin Forest

 

811 Livingston Court

 

Industrial

 

 

193

 

1,424

 

252

 

193

 

1,676

 

1,869

 

174

 

1983

 

1999

 

Franklin Forest

 

825 Franklin Court

 

Industrial

 

 

358

 

558

 

1,118

 

358

 

1,677

 

2,034

 

192

 

1983

 

1999

 

Franklin Forest

 

830 Franklin Court

 

Industrial

 

 

133

 

757

 

16

 

133

 

773

 

906

 

67

 

1983

 

1999

 

Franklin Forest

 

835 Franklin Court

 

Industrial

 

 

393

 

633

 

1,003

 

393

 

1,635

 

2,029

 

195

 

1983

 

1999

 

Franklin Forest

 

840 Franklin Court

 

Industrial

 

 

242

 

890

 

6

 

242

 

896

 

1,138

 

77

 

1983

 

1999

 

Franklin Forest

 

821 Livingston Court

 

Industrial

 

 

145

 

973

 

47

 

145

 

1,019

 

1,164

 

92

 

1983

 

1999

 

Franklin Forest

 

841 Livingston Court

 

Industrial

 

 

275

 

2,729

 

6

 

275

 

2,736

 

3,010

 

237

 

1983

 

1999

 

Northwest Business Center

 

1335 Capital Circle

 

Industrial

 

 

416

 

2,112

 

86

 

416

 

2,198

 

2,614

 

198

 

1985

 

1999

 

Northwest Business Center

 

1337-41-51 Capital Circle

 

Industrial

 

 

558

 

5,364

 

487

 

558

 

5,851

 

6,409

 

514

 

1985

 

1999

 

Northwest Business Center

 

2260 Northwest Parkway

 

Industrial

 

 

320

 

1,826

 

462

 

320

 

2,288

 

2,608

 

236

 

1982

 

1999

 

Northwest Business Center

 

2252 Northwest Parkway

 

Industrial

 

 

92

 

982

 

60

 

92

 

1,042

 

1,134

 

96

 

1982

 

1999

 

Northwest Business Center

 

2242 Northwest Parkway

 

Industrial

 

 

175

 

1,444

 

133

 

175

 

1,577

 

1,752

 

157

 

1982

 

1999

 

Northwest Business Center

 

2256 Northwest Parkway

 

Industrial

 

 

85

 

916

 

118

 

85

 

1,035

 

1,119

 

106

 

1982

 

1999

 

Northwest Business Center

 

2244 Northwest Parkway

 

Industrial

 

 

47

 

492

 

50

 

47

 

542

 

589

 

52

 

1982

 

1999

 

Northwest Business Center

 

2150 Northwest Parkway

 

Industrial

 

 

294

 

3,087

 

199

 

294

 

3,286

 

3,580

 

302

 

1982

 

1999

 

Northwest Business Center

 

2152 Northwest Parkway

 

Industrial

 

 

161

 

1,637

 

77

 

161

 

1,714

 

1,875

 

159

 

1982

 

1999

 

Northwest Business Center

 

2130 Northwest Parkway

 

Industrial

 

 

353

 

2,885

 

196

 

353

 

3,081

 

3,434

 

311

 

1982

 

1999

 

Northwest Business Center

 

2270 Northwest Parkway

 

Industrial

 

1,741

 

483

 

3,887

 

176

 

483

 

4,063

 

4,546

 

362

 

1988

 

1999

 

Northwest Business Center

 

2275 Northwest Parkway

 

Industrial

 

1,182

 

327

 

2,641

 

120

 

327

 

2,761

 

3,088

 

241

 

1988

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MARYLAND HEIGHTS, MISSOURI

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Riverport Business Park

 

Riverport Tower

 

Office

 

 

3,549

 

30,135

 

2,017

 

3,929

 

31,772

 

35,701

 

4,198

 

1991

 

1997

 

Riverport Business Park

 

Riverport Distribution A

 

Industrial

 

 

242

 

2,244

 

110

 

242

 

2,354

 

2,596

 

305

 

1990

 

1997

 

 

59



 

Development

 

Name

 

Building
Type

 

Encumbrances

 





 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

Riverport Business Park

 

Express Scripts HQ

 

Office

 

 

2,285

 

12,424

 

156

 

2,285

 

12,580

 

14,865

 

2,391

 

1999

 

1999

 

Riverport Business Park

 

Riverport 1

 

Industrial

 

 

900

 

4,399

 

106

 

900

 

4,506

 

5,405

 

1,116

 

1999

 

1999

 

Riverport Business Park

 

Riverport 2

 

Industrial

 

 

1,238

 

6,988

 

2

 

1,238

 

6,990

 

8,228

 

1,401

 

2000

 

2000

 

Riverport Business Park

 

Riverport 3

 

Industrial

 

 

1,269

 

4,514

 

 

1,269

 

4,514

 

5,783

 

166

 

2001

 

2001

 

Riverport Distribution

 

Express Scripts Service Center

 

Industrial

 

 

1,197

 

8,755

 

172

 

1,197

 

8,927

 

10,124

 

1,180

 

1992

 

1997

 

West Port Center

 

Westport Center I

 

Industrial

 

 

1,707

 

6,246

 

831

 

1,707

 

7,077

 

8,784

 

1,754

 

1998

 

1998

 

West Port Center

 

Westport Center II

 

Industrial

 

 

915

 

2,871

 

245

 

914

 

3,117

 

4,031

 

807

 

1998

 

1998

 

West Port Center

 

Westport Center III

 

Industrial

 

 

1,207

 

2,976

 

442

 

1,206

 

3,418

 

4,625

 

466

 

1998

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MASON, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deerfield Crossing

 

Deerfield Crossing Bldg 1

 

Office

 

 

1,493

 

14,354

 

428

 

1,493

 

14,782

 

16,275

 

2,550

 

1999

 

1999

 

Deerfield Crossing

 

Deerfield Crossing Bldg 2

 

Office

 

 

1,069

 

14,119

 

 

1,069

 

14,119

 

15,188

 

942

 

2001

 

2001

 

Governor’s Pointe

 

Governor’s Pointe 4770

 

Office

 

3,950

 

586

 

7,980

 

21

 

596

 

7,991

 

8,587

 

2,765

 

1986

 

1988

 

Governor’s Pointe

 

Governor’s Pointe 4700

 

Industrial

 

3,055

 

584

 

5,833

 

225

 

595

 

6,048

 

6,642

 

2,195

 

1987

 

1988

 

Governor’s Pointe

 

Governor’s Pointe 4900

 

Industrial

 

2,410

 

654

 

4,349

 

235

 

673

 

4,565

 

5,239

 

1,449

 

1987

 

1989

 

Governor’s Pointe

 

Governor’s Pointe 4705

 

Office

 

 

719

 

7,876

 

2,331

 

987

 

9,939

 

10,925

 

2,807

 

1988

 

1993

 

Governor’s Pointe

 

Governor’s Pointe 4605

 

Office

 

 

630

 

17,668

 

1,156

 

909

 

18,545

 

19,454

 

4,503

 

1990

 

1993

 

Governor’s Pointe

 

Governor’s Pointe 8990

 

Office

 

 

594

 

6,134

 

436

 

594

 

6,570

 

7,164

 

1,678

 

1997

 

1997

 

Governor’s Pointe

 

Governor’s Pointe 4660

 

Office

 

 

385

 

4,807

 

24

 

529

 

4,687

 

5,216

 

899

 

1997

 

1997

 

Governor’s Pointe

 

Governor’s Pointe 4680

 

Office

 

 

1,115

 

8,614

 

997

 

1,115

 

9,611

 

10,726

 

2,330

 

1998

 

1998

 

Governor’s Pointe

 

Governor’s Pointe 4690

 

Office

 

 

 

907

 

3,469

 

 

907

 

3,469

 

4,375

 

 

 

2002

 

2002

 

Governors Pointe Retail

 

Bigg’s Supercenter

 

Retail

 

 

2,107

 

9,927

 

54

 

4,227

 

7,860

 

12,087

 

1,170

 

1996

 

1996

 

Governors Pointe Retail

 

Lowes

 

Retail

 

 

3,750

 

6,529

 

224

 

3,750

 

6,754

 

10,504

 

800

 

1997

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MAYFIELD HEIGHTS, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Landerbrook Corporate Ctr

 

Landerbrook Corp. Center One

 

Office

 

 

1,807

 

10,863

 

122

 

1,808

 

10,984

 

12,792

 

2,340

 

1997

 

1997

 

Landerbrook Corporate Ctr

 

Landerbrook Corp. Center Two

 

Office

 

 

1,382

 

10,130

 

940

 

1,382

 

11,070

 

12,452

 

1,820

 

1998

 

1998

 

Landerbrook Corporate Ctr

 

Landerbrook Corp. Center Three

 

Office

 

 

1,528

 

8,505

 

460

 

1,528

 

8,965

 

10,493

 

283

 

2000

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MCDONOUGH, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liberty Dist. Center

 

120 Declaration Drive

 

Industrial

 

 

615

 

8,582

 

30

 

615

 

8,612

 

9,227

 

750

 

1997

 

1999

 

Liberty Dist. Center

 

Liberty III

 

Industrial

 

 

 

2,273

 

14,500

 

 

2,273

 

14,500

 

16,773

 

625

 

2001

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MENDOTA HEIGHTS, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Enterprise Industrial Center

 

Enterprise Industrial Center

 

Industrial

 

2,126

 

864

 

5,039

 

636

 

864

 

5,674

 

6,538

 

790

 

1979

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MIDDLETOWN, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Monroe Business Center

 

Monroe Business Center 2

 

Industrial

 

 

 

767

 

11,546

 

 

767

 

11,546

 

12,313

 

392

 

2000

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MILFORD, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Park 50

 

Park 50 Bldg 17

 

Office

 

 

500

 

5,488

 

176

 

510

 

5,654

 

6,164

 

2,304

 

1985

 

1986

 

Park 50

 

Park 50 Bldg 20

 

Industrial

 

3,493

 

461

 

7,079

 

55

 

469

 

7,126

 

7,595

 

2,972

 

1987

 

1988

 

Park 50

 

Park 50 Bldg 25

 

Industrial

 

 

1,161

 

4,146

 

535

 

1,184

 

4,657

 

5,841

 

1,133

 

1989

 

1993

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MINNEAPOLIS, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Broadway Business Center

 

Broadway Business Ctr III

 

Industrial

 

 

140

 

813

 

77

 

144

 

886

 

1,030

 

108

 

1983

 

1998

 

Broadway Business Center

 

Broadway Business Ctr IV

 

Industrial

 

 

194

 

1,154

 

194

 

200

 

1,342

 

1,542

 

204

 

1983

 

1998

 

Broadway Business Center

 

Broadway Business Ctr VI

 

Industrial

 

 

433

 

2,518

 

239

 

447

 

2,742

 

3,190

 

353

 

1983

 

1998

 

Broadway Business Center

 

Broadway Business Ctr VII

 

Industrial

 

 

233

 

1,369

 

169

 

241

 

1,531

 

1,772

 

253

 

1983

 

1998

 

Minneapolis

 

Chilies Ground Lease

 

Grounds

 

 

921

 

 

69

 

990

 

 

990

 

 

 

 

1998

 

Minneapolis

 

Olive Garden Ground Lease

 

Grounds

 

 

921

 

 

 

921

 

 

921

 

 

 

 

1998

 

10801 Red Circle Drive

 

10801 Red Circle Dr.

 

Office

 

 

527

 

3,478

 

747

 

527

 

4,224

 

4,752

 

1,108

 

1977

 

1997

 

Encore Park

 

Encore Park

 

Industrial

 

 

947

 

5,668

 

426

 

974

 

6,067

 

7,041

 

839

 

1977

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MONROE, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

60



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

Monroe Business Center

 

Monroe Business Center Bldg. 1

 

Industrial

 

 

660

 

5,435

 

304

 

660

 

5,739

 

6,399

 

520

 

1992

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MORRISVILLE, NORTH CAROLINA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Perimeter Park

 

507 Airport Blvd

 

Industrial

 

5,274

 

1,327

 

8,442

 

378

 

1,351

 

8,796

 

10,147

 

918

 

1993

 

1999

 

Perimeter Park

 

5151 McCrimmon Pkwy

 

Industrial

 

 

1,318

 

8,219

 

412

 

1,342

 

8,607

 

9,949

 

892

 

1995

 

1999

 

Perimeter Park

 

2600 Perimeter Park Dr

 

Industrial

 

 

975

 

5,392

 

256

 

991

 

5,632

 

6,623

 

486

 

1997

 

1999

 

Perimeter Park

 

5150 McCrimmon Pkwy

 

Industrial

 

 

1,739

 

12,249

 

99

 

1,773

 

12,313

 

14,086

 

1,065

 

1998

 

1999

 

Perimeter Park

 

2400 Perimeter Park Dr.

 

Office

 

 

760

 

6,305

 

198

 

778

 

6,485

 

7,263

 

586

 

1999

 

1999

 

Perimeter Park

 

3000 Perimeter Park Dr

 

Industrial

 

1,895

 

482

 

3,156

 

595

 

491

 

3,742

 

4,233

 

389

 

1989

 

1999

 

Perimeter Park

 

2900 Perimeter Park Dr

 

Industrial

 

1,430

 

235

 

2,340

 

618

 

241

 

2,952

 

3,193

 

361

 

1990

 

1999

 

Perimeter Park

 

2800 Perimeter Park Dr

 

Industrial

 

2,624

 

777

 

4,927

 

157

 

791

 

5,070

 

5,861

 

474

 

1992

 

1999

 

Perimeter Park

 

100 Perimeter Park Drive

 

Industrial

 

 

477

 

3,239

 

188

 

477

 

3,427

 

3,904

 

302

 

1987

 

1999

 

Perimeter Park

 

200 Perimeter Park Drive

 

Industrial

 

 

567

 

3,149

 

70

 

567

 

3,219

 

3,786

 

296

 

1987

 

1999

 

Perimeter Park

 

300 Perimeter Park Drive

 

Industrial

 

 

567

 

3,148

 

129

 

567

 

3,278

 

3,845

 

296

 

1986

 

1999

 

Perimeter Park

 

400 Perimeter Park Drive

 

Industrial

 

3,857

 

486

 

4,455

 

104

 

486

 

4,560

 

5,046

 

415

 

1983

 

1999

 

Perimeter Park

 

500 Perimeter Park Drive

 

Industrial

 

 

522

 

4,421

 

113

 

522

 

4,534

 

5,056

 

417

 

1985

 

1999

 

Perimeter Park

 

800 Perimeter Park Drive

 

Industrial

 

2,852

 

405

 

3,309

 

378

 

405

 

3,687

 

4,092

 

318

 

1984

 

1999

 

Perimeter Park

 

900 Perimeter Park Drive

 

Industrial

 

 

629

 

1,908

 

842

 

629

 

2,750

 

3,379

 

254

 

1982

 

1999

 

Perimeter Park

 

1000 Perimeter Park Drive

 

Industrial

 

 

405

 

3,259

 

833

 

405

 

4,091

 

4,496

 

389

 

1982

 

1999

 

Perimeter Park

 

1100 Perimeter Park Drive

 

Industrial

 

 

777

 

6,037

 

486

 

794

 

6,506

 

7,301

 

650

 

1990

 

1999

 

Perimeter Park

 

1400 Perimeter Park Drive

 

Office

 

 

666

 

4,603

 

58

 

691

 

4,636

 

5,327

 

396

 

1991

 

1999

 

Perimeter Park

 

1500 Perimeter Park Drive

 

Office

 

 

1,148

 

10,397

 

373

 

1,177

 

10,741

 

11,918

 

1,095

 

1996

 

1999

 

Perimeter Park

 

1600 Perimeter Park Drive

 

Office

 

6,164

 

1,463

 

10,134

 

263

 

1,492

 

10,368

 

11,860

 

912

 

1994

 

1999

 

Perimeter Park

 

1800 Perimeter Park Drive

 

Office

 

3,540

 

907

 

5,751

 

152

 

955

 

5,855

 

6,810

 

498

 

1994

 

1999

 

Perimeter Park

 

2000 Perimeter Park Drive

 

Office

 

 

788

 

8,210

 

254

 

842

 

8,410

 

9,251

 

720

 

1997

 

1999

 

Perimeter Park

 

1700 Perimeter Center West

 

Office

 

 

1,230

 

10,780

 

25

 

1,260

 

10,775

 

12,035

 

951

 

1997

 

1999

 

Perimeter Park

 

3900 N. Paramount Parkway

 

Office

 

 

540

 

13,296

 

142

 

574

 

13,403

 

13,978

 

1,175

 

1998

 

1999

 

Perimeter Park

 

3900 S.Paramount Pkwy

 

Office

 

 

1,575

 

12,455

 

682

 

1,612

 

13,101

 

14,713

 

1,504

 

2000

 

1999

 

Perimeter Park

 

5200 East Paramount

 

Office

 

 

1,748

 

17,735

 

228

 

1,797

 

17,914

 

19,711

 

2,085

 

1999

 

1999

 

Perimeter Park

 

3500 Paramount Pkwy

 

Office

 

 

755

 

12,948

 

2

 

755

 

12,950

 

13,705

 

1,218

 

1999

 

2000

 

Perimeter Park

 

2700 Perimeter Park

 

Industrial

 

 

662

 

3,209

 

 

662

 

3,209

 

3,871

 

95

 

2001

 

2001

 

Perimeter Park

 

5200 West Paramount

 

Office

 

 

1,831

 

13,288

 

 

1,831

 

13,288

 

15,119

 

 

2000

 

2001

 

Perimeter Park

 

2450 Perimeter Park

 

Office

 

 

 

669

 

4,003

 

 

669

 

4,003

 

4,672

 

238

 

2001

 

2001

 

Research Triangle Ind. Ctr

 

409 Airport Blvd Bldg A

 

Industrial

 

801

 

296

 

1,286

 

2

 

300

 

1,284

 

1,584

 

115

 

1983

 

1999

 

Research Triangle Ind. Ctr

 

409 Airport Blvd Bldg B

 

Industrial

 

495

 

175

 

769

 

35

 

177

 

802

 

979

 

74

 

1986

 

1999

 

Research Triangle Ind. Ctr

 

409 Airport Blvd bldg C

 

Industrial

 

1,718

 

185

 

2,849

 

363

 

193

 

3,204

 

3,397

 

422

 

1982

 

1999

 

Woodlake Center

 

100 Innovation Avenue

 

Industrial

 

 

633

 

4,003

 

261

 

633

 

4,264

 

4,897

 

445

 

1994

 

1999

 

Woodlake Center

 

101 Innovation Ave

 

Industrial

 

 

615

 

4,095

 

98

 

615

 

4,193

 

4,808

 

379

 

1997

 

1999

 

Woodlake Center

 

200 Innovation Drive

 

Industrial

 

 

357

 

4,503

 

 

357

 

4,503

 

4,859

 

694

 

1999

 

1999

 

Woodlake Center

 

501 Innovation Ave.

 

Industrial

 

 

640

 

7,063

 

47

 

640

 

7,110

 

7,750

 

1,179

 

1999

 

1999

 

Woodlake Center

 

1000 Innovation

 

Industrial

 

 

 

514

 

2,927

 

 

514

 

2,927

 

3,441

 

61

 

1996

 

2002

 

Woodlake Center

 

1200 Innovation

 

Industrial

 

 

 

740

 

4,212

 

 

740

 

4,212

 

4,952

 

88

 

1996

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NASHVILLE, TENNESSEE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Airpark Business Center

 

1420 Donelson Pike

 

Industrial

 

570

 

1,331

 

5,401

 

612

 

1,357

 

5,987

 

7,344

 

562

 

1985

 

1999

 

Airpark Business Center

 

1410 Donelson Pike

 

Industrial

 

659

 

1,411

 

6,898

 

182

 

1,411

 

7,080

 

8,491

 

650

 

1986

 

1999

 

Airpark Business Center

 

1400 Donelson Pike

 

Industrial

 

511

 

1,276

 

5,042

 

269

 

1,276

 

5,312

 

6,588

 

530

 

1996

 

1999

 

Airpark Business Center

 

400 Airpark Center

 

Industrial

 

1,852

 

419

 

2,182

 

8

 

419

 

2,190

 

2,609

 

196

 

1989

 

1999

 

Airpark Business Center

 

500 Airpark Center Dr.

 

Industrial

 

3,011

 

923

 

2,456

 

862

 

923

 

3,318

 

4,241

 

361

 

1988

 

1999

 

Airpark Business Center

 

600 Airport Center Dr

 

Industrial

 

2,915

 

729

 

3,331

 

46

 

729

 

3,377

 

4,106

 

291

 

1990

 

1999

 

Airpark Business Center

 

700 Airpark Center Dr.

 

Industrial

 

2,837

 

801

 

2,840

 

356

 

801

 

3,197

 

3,997

 

280

 

1992

 

1999

 

Airpark Business Center

 

800 Airpark Center Dr.

 

Industrial

 

2,450

 

924

 

4,010

 

221

 

924

 

4,231

 

5,155

 

417

 

1995

 

1999

 

Airpark Business Center

 

900 Airpark Center Dr

 

Industrial

 

2,103

 

798

 

3,414

 

212

 

798

 

3,626

 

4,424

 

343

 

1995

 

1999

 

Airpark Business Center

 

1000 Airpark Center Dr.

 

Industrial

 

 

1,300

 

9,624

 

25

 

1,300

 

9,649

 

10,950

 

837

 

1997

 

1999

 

Airpark Business Center

 

5270 Harding place

 

Industrial

 

1,160

 

535

 

2,494

 

8

 

535

 

2,502

 

3,038

 

217

 

1996

 

1999

 

 

61



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

Airpark Business Center

 

1415 Donelson Pike

 

Industrial

 

3,918

 

1,308

 

8,799

 

150

 

1,308

 

8,949

 

10,257

 

757

 

1996

 

1999

 

Airpark Business Center

 

1413 Donelson Pike

 

Industrial

 

1,271

 

549

 

2,743

 

37

 

549

 

2,780

 

3,329

 

242

 

1996

 

1999

 

Airpark Business Center

 

5233 Harding Place

 

Industrial

 

 

628

 

3,075

 

 

628

 

3,075

 

3,703

 

437

 

1998

 

1999

 

Airpark East

 

Airpark East-Eagle Bldg

 

Industrial

 

 

 

1,564

 

3,341

 

 

1,564

 

3,341

 

4,905

 

249

 

2001

 

2002

 

Cumberland Business Center

 

Cumberland Business Center I

 

Industrial

 

 

1,461

 

6,938

 

 

1,461

 

6,938

 

8,399

 

974

 

1999

 

1999

 

Four-Forty Business Center

 

700 Melrose Avenue

 

Industrial

 

3,519

 

938

 

6,464

 

1

 

938

 

6,464

 

7,403

 

562

 

1997

 

1999

 

Four-Forty Business Center

 

684 Melrose Ave

 

Industrial

 

 

1,812

 

7,583

 

390

 

1,812

 

7,974

 

9,786

 

801

 

1998

 

1999

 

Four-Forty Business Center

 

782 Melrose Avenue

 

Industrial

 

 

1,522

 

5,750

 

196

 

1,522

 

5,946

 

7,467

 

545

 

1997

 

1999

 

Four-Forty Business Center

 

784 Melrose Ave.

 

Industrial

 

 

471

 

3,321

 

256

 

471

 

3,577

 

4,048

 

464

 

1999

 

1999

 

Greenbriar

 

Greenbriar Business Park

 

Industrial

 

 

1,445

 

5,160

 

597

 

1,445

 

5,757

 

7,202

 

1,254

 

1986

 

1994

 

Haywood Oaks

 

Haywood Oaks Bldg 2

 

Industrial

 

 

395

 

1,928

 

50

 

395

 

1,978

 

2,373

 

446

 

1988

 

1993

 

Haywood Oaks

 

Haywood Oaks Bldg 3

 

Industrial

 

 

346

 

1,752

 

296

 

346

 

2,048

 

2,394

 

472

 

1988

 

1993

 

Haywood Oaks

 

Haywood Oaks Bldg 4

 

Industrial

 

 

435

 

2,104

 

303

 

435

 

2,407

 

2,842

 

672

 

1988

 

1993

 

Haywood Oaks

 

Haywood Oaks Bldg 5

 

Industrial

 

 

629

 

3,060

 

141

 

629

 

3,202

 

3,830

 

752

 

1988

 

1993

 

Haywood Oaks

 

Haywood Oaks Bldg 6

 

Industrial

 

 

924

 

6,371

 

425

 

946

 

6,774

 

7,720

 

1,522

 

1989

 

1993

 

Haywood Oaks

 

Haywood Oaks Bldg 7

 

Industrial

 

 

456

 

1,858

 

189

 

456

 

2,046

 

2,503

 

349

 

1995

 

1995

 

Haywood Oaks

 

Haywood Oaks Bldg 8

 

Industrial

 

 

617

 

3,514

 

419

 

751

 

3,800

 

4,550

 

1,041

 

1997

 

1997

 

Haywood Oaks East

 

Haywood Oaks East

 

Industrial

 

 

969

 

5,866

 

239

 

969

 

6,106

 

7,075

 

694

 

2000

 

2000

 

Lakeview Place

 

Three Lakeview

 

Office

 

 

2,126

 

13,915

 

1,602

 

2,126

 

15,518

 

17,644

 

1,711

 

1999

 

1999

 

Lakeview Place

 

One Lakeview Place

 

Office

 

 

2,046

 

11,828

 

1,222

 

2,123

 

12,973

 

15,096

 

1,441

 

1986

 

1998

 

Lakeview Place

 

Two Lakeview Place

 

Office

 

 

2,046

 

11,858

 

1,005

 

2,046

 

12,863

 

14,909

 

1,529

 

1988

 

1998

 

Metro Center

 

545 Mainstream Dr.

 

Office

 

 

847

 

6,310

 

464

 

847

 

6,774

 

7,621

 

636

 

1983

 

1999

 

Metro Center

 

566 Mainstream Dr.

 

Industrial

 

 

454

 

3,927

 

271

 

454

 

4,198

 

4,652

 

400

 

1982

 

1999

 

Metro Center

 

621 Mainstream Dr.

 

Industrial

 

 

428

 

2,860

 

63

 

428

 

2,924

 

3,352

 

249

 

1984

 

1999

 

Metro Center

 

Riverview Business Center I

 

Industrial

 

 

497

 

2,848

 

57

 

497

 

2,906

 

3,403

 

332

 

2000

 

2000

 

Metro Center

 

Riverview Business Center II

 

Industrial

 

 

 

685

 

2,710

 

 

685

 

2,710

 

3,395

 

134

 

2001

 

2001

 

Metropolitan Airport Center

 

Metro Airport Center Bldg 1

 

Industrial

 

 

1,180

 

4,808

 

52

 

1,190

 

4,850

 

6,040

 

978

 

1999

 

1999

 

Metropolitan Airport Center

 

Metro Airport Bus Ctr C

 

Industrial

 

 

1,053

 

6,582

 

 

1,053

 

6,582

 

7,635

 

148

 

2001

 

2001

 

Nashville Business Center

 

3300 Briley Park Blvd

 

Industrial

 

 

936

 

7,138

 

 

936

 

7,138

 

8,074

 

1,289

 

1997

 

1999

 

Royal Parkway Center

 

2515 Perimeter Park

 

Industrial

 

 

731

 

4,753

 

195

 

734

 

4,945

 

5,679

 

431

 

1990

 

1999

 

Royal Parkway Center

 

500 Royal Parkway

 

Industrial

 

 

599

 

4,636

 

 

603

 

4,632

 

5,235

 

403

 

1990

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NEW HOPE, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bass Lake Business Building

 

Bass Lake Business Bldg

 

Industrial

 

872

 

298

 

1,715

 

80

 

298

 

1,795

 

2,093

 

242

 

1981

 

1997

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NORCROSS, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gwinnett Park

 

1750 Beaver Ruin

 

Industrial

 

 

640

 

6,793

 

490

 

640

 

7,283

 

7,922

 

614

 

1997

 

1999

 

Gwinnett Park

 

4258 Communications Drive

 

Industrial

 

 

29

 

2,388

 

103

 

29

 

2,491

 

2,520

 

208

 

1981

 

1999

 

Gwinnett Park

 

4261 Communications Drive

 

Industrial

 

 

254

 

1,916

 

109

 

254

 

2,026

 

2,280

 

172

 

1981

 

1999

 

Gwinnett Park

 

4291 Communications Drive

 

Industrial

 

 

4

 

1,467

 

5

 

16

 

1,460

 

1,476

 

127

 

1981

 

1999

 

Gwinnett Park

 

1826 Doan Way

 

Industrial

 

 

51

 

3,065

 

122

 

51

 

3,187

 

3,238

 

299

 

1984

 

1999

 

Gwinnett Park

 

1857 Doan Way

 

Industrial

 

 

23

 

397

 

45

 

56

 

408

 

464

 

36

 

1970

 

1999

 

Gwinnett Park

 

1650 International Blvd

 

Industrial

 

 

69

 

2,211

 

34

 

69

 

2,246

 

2,314

 

195

 

1984

 

1999

 

Gwinnett Park

 

4245 International Blvd

 

Industrial

 

 

192

 

10,848

 

 

192

 

10,849

 

11,041

 

944

 

1985

 

1999

 

Gwinnett Park

 

4250 International Blvd

 

Industrial

 

 

193

 

3,042

 

37

 

216

 

3,056

 

3,272

 

265

 

1986

 

1999

 

Gwinnett Park

 

4295 International Blvd

 

Industrial

 

 

58

 

2,330

 

45

 

58

 

2,376

 

2,434

 

216

 

1984

 

1999

 

Gwinnett Park

 

4320 International Blvd

 

Industrial

 

 

44

 

2,058

 

180

 

44

 

2,237

 

2,282

 

182

 

1984

 

1999

 

Gwinnett Park

 

4350 International Blvd

 

Industrial

 

 

78

 

3,061

 

243

 

78

 

3,305

 

3,383

 

298

 

1982

 

1999

 

Gwinnett Park

 

4355 International Blvd

 

Industrial

 

 

233

 

2,969

 

262

 

233

 

3,232

 

3,465

 

332

 

1983

 

1999

 

Gwinnett Park

 

4405A International Blvd

 

Industrial

 

 

97

 

2,680

 

618

 

97

 

3,298

 

3,395

 

285

 

1984

 

1999

 

Gwinnett Park

 

4405B International Blvd

 

Industrial

 

 

118

 

3,900

 

190

 

118

 

4,091

 

4,208

 

362

 

1984

 

1999

 

Gwinnett Park

 

4405C International Blvd

 

Industrial

 

 

21

 

800

 

70

 

21

 

871

 

892

 

74

 

1984

 

1999

 

Gwinnett Park

 

1828 Meca Way

 

Industrial

 

 

16

 

2,621

 

22

 

16

 

2,643

 

2,659

 

230

 

1975

 

1999

 

Gwinnett Park

 

1858 Meca Way

 

Industrial

 

 

20

 

1,828

 

171

 

27

 

1,991

 

2,019

 

188

 

1975

 

1999

 

Gwinnett Park

 

4316 Park Drive

 

Industrial

 

 

262

 

1,420

 

275

 

262

 

1,695

 

1,957

 

195

 

1980

 

1999

 

 

62



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

Gwinnett Park

 

4357 Park Drive

 

Industrial

 

 

12

 

2,251

 

292

 

12

 

2,544

 

2,555

 

256

 

1979

 

1999

 

Gwinnett Park

 

4366 Park Drive

 

Office

 

 

6

 

205

 

299

 

22

 

488

 

510

 

42

 

1981

 

1999

 

Gwinnett Park

 

4386 Park Drive

 

Industrial

 

 

17

 

986

 

411

 

17

 

1,397

 

1,415

 

146

 

1973

 

1999

 

Gwinnett Park

 

4436 Park Drive

 

Industrial

 

 

18

 

2,279

 

27

 

18

 

2,306

 

2,324

 

199

 

1968

 

1999

 

Gwinnett Park

 

4437 Park Drive

 

Industrial

 

 

21

 

2,644

 

177

 

21

 

2,821

 

2,842

 

251

 

1978

 

1999

 

Gwinnett Park

 

4467 Park Drive

 

Industrial

 

 

6

 

1,630

 

56

 

6

 

1,685

 

1,691

 

162

 

1978

 

1999

 

Gwinnett Park

 

4487 Park Drive

 

Industrial

 

 

6

 

3,407

 

359

 

6

 

3,767

 

3,773

 

366

 

1978

 

1999

 

Gwinnett Park

 

1835 Shackleford Court

 

Office

 

 

29

 

6,309

 

325

 

29

 

6,634

 

6,662

 

635

 

1990

 

1999

 

Gwinnett Park

 

1854 Shackleford Road

 

Office

 

 

52

 

10,387

 

918

 

52

 

11,305

 

11,357

 

1,069

 

1985

 

1999

 

Gwinnett Park

 

4274 Shackleford Road

 

Industrial

 

 

27

 

3,626

 

180

 

27

 

3,805

 

3,832

 

333

 

1974

 

1999

 

Gwinnett Park

 

4275 Shackleford Court

 

Office

 

430

 

8

 

2,125

 

312

 

12

 

2,433

 

2,445

 

224

 

1985

 

1999

 

Gwinnett Park

 

4344 Shackleford Road

 

Industrial

 

 

286

 

2,221

 

167

 

286

 

2,387

 

2,673

 

291

 

1975

 

1999

 

Gwinnett Park

 

4355 Shackleford Road

 

Industrial

 

 

7

 

1,904

 

67

 

70

 

1,909

 

1,979

 

597

 

1972

 

1999

 

Gwinnett Park

 

4364 Shackleford Road

 

Industrial

 

 

9

 

982

 

6

 

9

 

987

 

997

 

85

 

1973

 

1999

 

Gwinnett Park

 

4366 Shackleford Road

 

Industrial

 

 

20

 

2,567

 

315

 

26

 

2,875

 

2,901

 

314

 

1981

 

1999

 

Gwinnett Park

 

4388 Shackelford Road

 

Industrial

 

 

33

 

4,002

 

240

 

43

 

4,233

 

4,276

 

363

 

1981

 

1999

 

Gwinnett Park

 

4400 Shackleford Road

 

Industrial

 

 

14

 

1,567

 

1

 

18

 

1,563

 

1,582

 

127

 

1981

 

1999

 

Gwinnett Park

 

4444 Shackleford Road

 

Industrial

 

 

31

 

2,632

 

336

 

31

 

2,967

 

2,999

 

339

 

1979

 

1999

 

Gwinnett Pavilion

 

1505 Pavillion Place

 

Industrial

 

 

448

 

3,996

 

510

 

448

 

4,506

 

4,955

 

701

 

1988

 

1999

 

Gwinnett Pavilion

 

3883 Steve Reynolds Blvd.

 

Industrial

 

 

612

 

4,928

 

27

 

612

 

4,955

 

5,567

 

429

 

1990

 

1999

 

Gwinnett Pavilion

 

3890 Steve Reynolds Blvd

 

Industrial

 

 

519

 

3,028

 

1

 

519

 

3,028

 

3,548

 

267

 

1991

 

1999

 

Gwinnett Pavilion

 

3950 Steve Reynolds Blvd.

 

Industrial

 

 

684

 

2,825

 

21

 

684

 

2,846

 

3,530

 

251

 

1992

 

1999

 

Northeast I85

 

6525-27 Jimmy Carter Blvd

 

Industrial

 

 

509

 

2,324

 

376

 

509

 

2,700

 

3,209

 

447

 

1983

 

1999

 

Northeast I85

 

5755 Peachtree Industrial Blvd

 

Office

 

 

800

 

3,652

 

229

 

800

 

3,881

 

4,681

 

337

 

1997

 

1999

 

Northeast I85

 

5765 Peachtree Industrial Blvd

 

Industrial

 

 

521

 

4,671

 

 

521

 

4,671

 

5,192

 

407

 

1997

 

1999

 

Northeast I85

 

5775 Peachtree Industrial Blvd

 

Industrial

 

 

521

 

4,695

 

36

 

521

 

4,730

 

5,251

 

420

 

1997

 

1999

 

Northwoods

 

2915 Courtyards Drive

 

Industrial

 

 

268

 

1,961

 

32

 

268

 

1,994

 

2,262

 

172

 

1986

 

1999

 

Northwoods

 

2925 Courtyards Drive

 

Industrial

 

 

333

 

3,235

 

 

333

 

3,235

 

3,568

 

281

 

1986

 

1999

 

Northwoods

 

2975 Courtyards Drive

 

Industrial

 

 

144

 

1,264

 

104

 

144

 

1,368

 

1,512

 

126

 

1986

 

1999

 

Northwoods

 

2995 Courtyards Drive

 

Industrial

 

 

109

 

892

 

 

109

 

892

 

1,001

 

78

 

1986

 

1999

 

Northwoods

 

2725 Northwoods Pkwy

 

Industrial

 

 

440

 

2,568

 

552

 

440

 

3,120

 

3,560

 

320

 

1984

 

1999

 

Northwoods

 

2755 Northwoods Pkwy

 

Industrial

 

 

249

 

2,880

 

150

 

249

 

3,029

 

3,278

 

266

 

1986

 

1999

 

Northwoods

 

2775 Northwoods Pkwy

 

Industrial

 

 

322

 

2,425

 

 

322

 

2,425

 

2,747

 

211

 

1986

 

1999

 

Northwoods

 

2850 Colonnades Court

 

Industrial

 

 

562

 

5,280

 

 

562

 

5,280

 

5,842

 

459

 

1988

 

1999

 

Northwoods

 

3040 Northwoods Pkwy

 

Industrial

 

 

298

 

1,801

 

155

 

298

 

1,956

 

2,254

 

213

 

1984

 

1999

 

Northwoods

 

3044 Northwoods Circle

 

Industrial

 

 

167

 

718

 

34

 

167

 

752

 

919

 

66

 

1984

 

1999

 

Northwoods

 

3055 Northwoods Pkwy

 

Industrial

 

 

213

 

1,556

 

99

 

213

 

1,656

 

1,869

 

185

 

1985

 

1999

 

Northwoods

 

3075 Northwoods Pkwy

 

Industrial

 

 

374

 

2,865

 

97

 

374

 

2,962

 

3,335

 

285

 

1985

 

1999

 

Northwoods

 

3100 Northwoods Pkwy

 

Industrial

 

 

393

 

2,543

 

6

 

393

 

2,549

 

2,942

 

221

 

1985

 

1999

 

Northwoods

 

3155 Northwoods Pkwy

 

Industrial

 

 

331

 

2,504

 

12

 

331

 

2,516

 

2,847

 

218

 

1985

 

1999

 

Northwoods

 

3175 Northwoods Pkwy

 

Industrial

 

 

250

 

2,071

 

23

 

250

 

2,094

 

2,344

 

181

 

1985

 

1999

 

Peachtree Corners Tech Center

 

3170 Reps Miller Road

 

Industrial

 

 

500

 

3,662

 

18

 

500

 

3,680

 

4,180

 

320

 

1998

 

1999

 

Peachtree Corners Tech Center

 

3180 Reps Miller Road

 

Industrial

 

 

500

 

2,943

 

38

 

500

 

2,981

 

3,481

 

261

 

1998

 

1999

 

Peachtree Corners Tech Center

 

3190 Reps Miller Road

 

Industrial

 

 

525

 

2,363

 

215

 

525

 

2,579

 

3,104

 

238

 

1998

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NORTHLAKE, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Northlake

 

Northlake I

 

Industrial

 

 

 

5,721

 

9,690

 

 

5,721

 

9,690

 

15,411

 

 

 

2002

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NORTH OLMSTED, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Great Northern Corp Center

 

Great Northern Corp Center I

 

Office

 

 

1,048

 

7,146

 

564

 

1,040

 

7,718

 

8,758

 

1,301

 

1985

 

1996

 

Great Northern Corp Center

 

Great Northern Corp Center II

 

Office

 

 

1,048

 

7,232

 

812

 

1,048

 

8,045

 

9,093

 

1,512

 

1987

 

1996

 

Great Northern Corp Center

 

Great Northern Corp Center III

 

Office

 

 

604

 

5,693

 

892

 

604

 

6,585

 

7,189

 

1,253

 

1999

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OLIVETTE, MISSOURI

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

I-170 Center

 

I-170 Center

 

Industrial

 

 

950

 

4,184

 

530

 

1,018

 

4,646

 

5,665

 

797

 

1986

 

1996

 

 

63



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

Warson Commerce Center

 

Warson Commerce Center

 

 

 

 

 

749

 

5,405

 

340

 

749

 

5,745

 

6,494

 

736

 

1987

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ORLANDO, FLORIDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Centre at Lee Vista

 

Lee Vista Distribution Ctr I

 

 

 

 

 

819

 

4,545

 

438

 

819

 

4,983

 

5,802

 

1,058

 

1998

 

1999

 

Business Centre at Lee Vista

 

Lee Vista Distribution Ctr II

 

 

 

 

 

740

 

3,914

 

95

 

740

 

4,009

 

4,749

 

577

 

1999

 

2000

 

Business Centre at Lee Vista

 

Lee Vista Service Center I

 

 

 

 

 

926

 

2,344

 

99

 

926

 

2,444

 

3,369

 

78

 

2000

 

2001

 

Business Centre at Lee Vista-Gen

 

Lee Vista Distrib. Center III

 

 

 

 

 

841

 

3,580

 

 

841

 

3,580

 

4,421

 

33

 

2001

 

2002

 

Parksouth Dist. Center

 

Parksouth Dist. Ctr-Bldg B

 

 

 

 

 

565

 

4,893

 

 

565

 

4,893

 

5,458

 

426

 

1996

 

1999

 

Parksouth Dist. Center

 

Parksouth Dist. Ctr-Bldg A

 

 

 

 

 

493

 

4,545

 

 

493

 

4,545

 

5,038

 

402

 

1997

 

1999

 

Parksouth Dist. Center

 

Parksouth Dist. Ctr-Bldg D

 

Industrial

 

 

593

 

4,131

 

 

593

 

4,131

 

4,724

 

375

 

1998

 

1999

 

Parksouth Dist. Center

 

Parksouth Dist. Ctr-Bldg E

 

Industrial

 

 

649

 

4,654

 

42

 

649

 

4,696

 

5,345

 

426

 

1997

 

1999

 

Parksouth Dist. Center

 

Parksouth Dist. Ctr-Bldg F

 

Industrial

 

 

1,030

 

5,525

 

895

 

1,030

 

6,420

 

7,450

 

715

 

1999

 

1999

 

Parksouth Dist. Center

 

Parksouth Dist. Ctr-Bldg H

 

Industrial

 

 

 

725

 

3,950

 

 

725

 

3,950

 

4,675

 

255

 

2000

 

2000

 

Parksouth Dist. Center

 

Chase BTS-Orlando

 

Industrial

 

 

 

598

 

2,032

 

 

598

 

2,032

 

2,629

 

69

 

2000

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PEPPER PIKE, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate Circle

 

Corporate Circle

 

Office

 

 

1,696

 

11,429

 

1,379

 

1,698

 

12,807

 

14,504

 

2,083

 

1983

 

1996

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PLAINFIELD, INDIANA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Plainfield Business Park

 

Plainfield Building 1

 

Industrial

 

6,254

 

1,104

 

11,151

 

10

 

1,104

 

11,161

 

12,265

 

751

 

2000

 

2000

 

Plainfield Business Park

 

Plainfield Building 2

 

Industrial

 

 

 

1,387

 

9,668

 

 

1,387

 

9,668

 

11,055

 

683

 

2000

 

2000

 

Plainfield Business Park

 

Plainfield Building 3

 

Industrial

 

 

 

2,016

 

10,491

 

 

2,016

 

10,491

 

12,507

 

197

 

2002

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PLANO, TEXAS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Legacy Business Park

 

Metasolv Building Phase I

 

Office

 

 

1,527

 

5,831

 

706

 

1,527

 

6,538

 

8,064

 

633

 

1997

 

1999

 

Legacy Business Park

 

Metasolv Building Phase II

 

Office

 

 

1,181

 

11,154

 

65

 

1,181

 

11,219

 

12,399

 

1,129

 

1999

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PLYMOUTH, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Medicine Lake

 

Medicine Lake Indus. Center

 

Industrial

 

3,638

 

1,158

 

6,676

 

816

 

1,145

 

7,504

 

8,649

 

888

 

1970

 

1997

 

Plymouth Office/Tech Center

 

Plymouth Office/Tech Center

 

Industrial

 

 

428

 

2,442

 

300

 

431

 

2,738

 

3,170

 

395

 

1986

 

1998

 

Plymouth Service Center

 

Plymouth Service Center

 

Industrial

 

 

345

 

1,993

 

732

 

351

 

2,719

 

3,070

 

340

 

1978

 

1999

 

Westpoint Buildings

 

Westpoint Business Ctr

 

Office

 

 

98

 

569

 

157

 

114

 

710

 

825

 

69

 

1978

 

1999

 

Westpoint Buildings

 

Westpoint Bldg B&C

 

Industrial

 

 

370

 

2,135

 

414

 

370

 

2,549

 

2,919

 

303

 

1978

 

1999

 

Westpoint Buildings

 

Westpoint Bldg D&E

 

Industrial

 

 

362

 

2,095

 

588

 

362

 

2,682

 

3,045

 

363

 

1978

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

RALEIGH, NORTH CAROLINA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brook Forest

 

Brook Forest I

 

Office

 

 

1,242

 

6,181

 

 

1,242

 

6,181

 

7,423

 

448

 

2000

 

2000

 

Crabtree Overlook

 

Crabtree Overlook

 

Office

 

 

2,164

 

17,692

 

 

2,164

 

17,692

 

19,856

 

760

 

2000

 

2001

 

Interchange Plaza

 

6525 West Campus Oval

 

Office

 

5,143

 

842

 

3,796

 

1,909

 

881

 

5,666

 

6,547

 

172

 

1993

 

1999

 

Interchange Plaza

 

801 Jones Franklin Rd

 

Office

 

 

1,351

 

7,778

 

45

 

1,351

 

7,823

 

9,174

 

687

 

1995

 

1999

 

Interchange Plaza

 

5520 Capital Ctr. Dr

 

Office

 

 

 

842

 

4,395

 

 

842

 

4,395

 

5,237

 

400

 

1993

 

1999

 

Spring Forest Business Center

 

3200 Spring Forest Road

 

Industrial

 

 

561

 

5,240

 

109

 

561

 

5,350

 

5,911

 

500

 

1986

 

1999

 

Spring Forest Business Center

 

3100 Spring Forest Road

 

Industrial

 

 

616

 

4,220

 

113

 

616

 

4,333

 

4,949

 

408

 

1992

 

1999

 

Spring Forest Business Center

 

Spring Forest Bus Center III

 

Office

 

 

 

462

 

3,124

 

 

462

 

3,124

 

3,586

 

2002

 

2002

 

 

 

Walnut Creek

 

Walnut Creek Business Park #1

 

Industrial

 

 

 

419

 

3,100

 

 

419

 

3,100

 

3,519

 

176

 

2001

 

2001

 

Walnut Creek

 

Walnut Creek Business Park #2

 

Industrial

 

 

 

456

 

3,774

 

 

456

 

3,774

 

4,230

 

171

 

2001

 

2001

 

Walnut Creek

 

Walnut Creek Business Park #3

 

Industrial

 

 

679

 

4,345

 

 

679

 

4,345

 

5,025

 

252

 

2001

 

2001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ROMEOVILLE, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Crossroads Business Park

 

Chapco Carton Company

 

Industrial

 

 

 

917

 

5,217

 

 

917

 

5,217

 

6,133

 

120

 

1999

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ROSWELL, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hembree Crest

 

11545 Wills Road

 

Industrial

 

 

1,225

 

6,461

 

147

 

1,225

 

6,608

 

7,833

 

566

 

1998

 

1999

 

Hembree Park

 

105 Hembree Park Drive

 

Industrial

 

 

288

 

1,791

 

329

 

288

 

2,119

 

2,407

 

211

 

1988

 

1999

 

Hembree Park

 

150 Hembree Park Drive

 

Industrial

 

 

824

 

3,751

 

63

 

824

 

3,814

 

4,638

 

332

 

1985

 

1999

 

 

64



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

Hembree Park

 

200 Hembree Park Drive

 

 

 

 

 

160

 

2,059

 

86

 

160

 

2,145

 

2,305

 

191

 

1985

 

1999

 

Hembree Park

 

645 Hembree Parkway

 

 

 

 

 

248

 

2,620

 

421

 

248

 

3,041

 

3,289

 

343

 

1986

 

1999

 

Hembree Park

 

655 Hembree Parkway

 

 

 

 

 

248

 

2,755

 

145

 

248

 

2,900

 

3,148

 

260

 

1986

 

1999

 

Hembree Park

 

250 Hembree Park Drive

 

 

 

 

 

686

 

5,255

 

322

 

686

 

5,578

 

6,263

 

461

 

1996

 

1999

 

Hembree Park

 

660 Hembree Park Drive

 

 

 

 

 

785

 

5,070

 

360

 

785

 

5,430

 

6,215

 

450

 

1998

 

1999

 

Hembree Park

 

245 Hembree Park Drive

 

 

 

 

 

616

 

6,375

 

645

 

616

 

7,020

 

7,636

 

1,057

 

1999

 

1999

 

Mansell Commons

 

993 Mansell Road

 

 

 

 

 

136

 

1,285

 

 

136

 

1,285

 

1,421

 

112

 

1987

 

1999

 

Mansell Commons

 

995 Mansell Road

 

 

 

 

 

80

 

915

 

56

 

80

 

971

 

1,051

 

106

 

1987

 

1999

 

Mansell Commons

 

997 Mansell Road

 

Industrial

 

 

72

 

664

 

44

 

72

 

708

 

780

 

71

 

1987

 

1999

 

Mansell Commons

 

999 Mansell Road

 

Industrial

 

 

104

 

953

 

5

 

104

 

958

 

1,062

 

83

 

1987

 

1999

 

Mansell Commons

 

1003 Mansell Road

 

Industrial

 

 

136

 

1,362

 

121

 

136

 

1,482

 

1,618

 

158

 

1987

 

1999

 

Mansell Commons

 

1005 Mansell Road

 

Industrial

 

 

72

 

946

 

3

 

72

 

950

 

1,022

 

88

 

1987

 

1999

 

Mansell Commons

 

1007 Mansell Road

 

Industrial

 

 

168

 

2,129

 

278

 

168

 

2,407

 

2,575

 

228

 

1987

 

1999

 

Mansell Commons

 

1009 Mansell Road

 

Industrial

 

 

264

 

2,539

 

295

 

264

 

2,834

 

3,098

 

282

 

1986

 

1999

 

Mansell Commons

 

1011 Mansell Road

 

Industrial

 

 

256

 

2,655

 

373

 

256

 

3,028

 

3,284

 

329

 

1984

 

1999

 

North Meadow

 

1100 Northmeadow Parkway

 

Industrial

 

 

552

 

3,955

 

332

 

552

 

4,287

 

4,839

 

453

 

1989

 

1999

 

North Meadow

 

1150 Northmeadow Parkway

 

Industrial

 

 

464

 

3,230

 

158

 

464

 

3,388

 

3,852

 

328

 

1988

 

1999

 

North Meadow

 

1125 Northmeadow Parkway

 

Industrial

 

 

320

 

3,638

 

327

 

320

 

3,965

 

4,285

 

381

 

1987

 

1999

 

North Meadow

 

1175 Northmeadow Parkway

 

Industrial

 

 

328

 

3,409

 

497

 

328

 

3,907

 

4,235

 

392

 

1987

 

1999

 

North Meadow

 

1250 Northmeadow Parkway

 

Industrial

 

 

312

 

4,359

 

293

 

312

 

4,652

 

4,964

 

473

 

1989

 

1999

 

North Meadow

 

1225 Northmeadow Parkway

 

Industrial

 

 

336

 

3,518

 

204

 

336

 

3,721

 

4,057

 

353

 

1989

 

1999

 

North Meadow

 

1325 Northmeadow Parkway

 

Industrial

 

 

472

 

6,432

 

314

 

472

 

6,746

 

7,218

 

730

 

1990

 

1999

 

North Meadow

 

1335 Northmeadow Parkway

 

Industrial

 

 

946

 

8,174

 

130

 

946

 

8,304

 

9,250

 

728

 

1996

 

1999

 

North Meadow

 

11390 Old Roswell Road

 

Industrial

 

 

530

 

3,595

 

 

530

 

3,595

 

4,126

 

316

 

1997

 

1999

 

North Meadow

 

1400 Hembree Road

 

Industrial

 

 

545

 

3,258

 

3

 

545

 

3,261

 

3,806

 

290

 

1998

 

1999

 

North Meadow

 

1357 Hembree Road

 

Office

 

 

471

 

4,560

 

426

 

471

 

4,985

 

5,457

 

1,388

 

1999

 

1999

 

North Meadow

 

Northmeadow BD IV

 

Industrial

 

 

694

 

5,693

 

1

 

694

 

5,693

 

6,388

 

466

 

1999

 

1999

 

North Meadow

 

Northmeadow Service Ctr V

 

Industrial

 

 

705

 

3,256

 

 

705

 

3,256

 

3,961

 

288

 

1999

 

1999

 

North Meadow

 

Northmeadow BD VI

 

Industrial

 

 

423

 

3,046

 

38

 

423

 

3,084

 

3,507

 

388

 

2000

 

2000

 

Northbrook

 

Northbrook Business Dist II

 

Industrial

 

 

267

 

2,223

 

301

 

267

 

2,525

 

2,791

 

139

 

2000

 

2000

 

Other North Central Prop.

 

10745 Westside Parkway

 

Office

 

 

925

 

7,177

 

292

 

925

 

7,469

 

8,394

 

699

 

1995

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SEVEN HILLS, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rock Run

 

Rock Run - North

 

Office

 

3,122

 

837

 

5,637

 

314

 

837

 

5,950

 

6,787

 

1,048

 

1984

 

1996

 

Rock Run

 

Rock Run - Center

 

Office

 

4,160

 

1,046

 

6,991

 

1,007

 

1,046

 

7,998

 

9,044

 

1,771

 

1985

 

1996

 

Rock Run

 

Rock Run - South

 

Office

 

3,260

 

877

 

5,909

 

301

 

877

 

6,210

 

7,087

 

1,115

 

1986

 

1996

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SHARONVILLE, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Enterprise Park

 

Enterprise Bldg 1

 

Industrial

 

 

1,030

 

6,035

 

288

 

1,051

 

6,302

 

7,353

 

1,470

 

1990

 

1993

 

Enterprise Park

 

Enterprise Bldg 2

 

Industrial

 

 

733

 

3,903

 

723

 

747

 

4,611

 

5,358

 

1,239

 

1990

 

1993

 

Enterprise Park

 

Enterprise Bldg A

 

Industrial

 

 

119

 

728

 

85

 

119

 

814

 

933

 

158

 

1987

 

1995

 

Enterprise Park

 

Enterprise Bldg B

 

Industrial

 

 

119

 

1,237

 

74

 

119

 

1,311

 

1,430

 

258

 

1988

 

1995

 

Enterprise Park

 

Enterprise Bldg D

 

Industrial

 

 

243

 

1,990

 

89

 

243

 

2,079

 

2,322

 

435

 

1989

 

1995

 

Mosteller Dist. Center

 

Mosteller Distribution Ctr I

 

Industrial

 

 

1,327

 

6,316

 

275

 

1,327

 

6,591

 

7,918

 

1,346

 

1957

 

1996

 

Mosteller Dist. Center

 

Mosteller Distribution Ctr II

 

Industrial

 

 

828

 

4,761

 

1,147

 

828

 

5,908

 

6,736

 

1,160

 

1997

 

1997

 

Perimeter Park

 

Perimeter Park Bldg A

 

Industrial

 

 

229

 

1,343

 

182

 

229

 

1,525

 

1,754

 

262

 

1991

 

1996

 

Perimeter Park

 

Perimeter Park Bldg B

 

Industrial

 

 

244

 

1,063

 

150

 

244

 

1,212

 

1,457

 

232

 

1991

 

1996

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SOLON, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fountain Parkway

 

Fountain Parkway Bldg 2

 

Industrial

 

 

1,138

 

8,725

 

37

 

1,138

 

8,762

 

9,900

 

870

 

1998

 

1999

 

Fountain Parkway

 

Fountain Parkway Bldg 1

 

Industrial

 

 

527

 

2,907

 

41

 

527

 

2,948

 

3,475

 

351

 

1997

 

1998

 

Solon

 

30600 Carter

 

Industrial

 

 

819

 

3,425

 

289

 

821

 

3,712

 

4,533

 

499

 

1971

 

1997

 

Solon

 

6230 Cochran

 

Industrial

 

 

600

 

2,496

 

714

 

602

 

3,209

 

3,810

 

658

 

1977

 

1997

 

Solon

 

5821 Harper

 

Industrial

 

 

554

 

2,301

 

286

 

555

 

2,586

 

3,141

 

410

 

1970

 

1997

 

Solon

 

6161 Cochran

 

Industrial

 

 

395

 

1,642

 

498

 

396

 

2,139

 

2,535

 

316

 

1978

 

1997

 

 

65



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

Solon

 

5901 Harper

 

Industrial

 

 

349

 

1,441

 

163

 

350

 

1,603

 

1,953

 

222

 

1970

 

1997

 

Solon

 

29125 Solon

 

Industrial

 

 

504

 

2,072

 

421

 

505

 

2,492

 

2,997

 

320

 

1980

 

1997

 

Solon

 

6661 Cochran

 

Industrial

 

 

244

 

1,012

 

136

 

245

 

1,147

 

1,392

 

164

 

1979

 

1997

 

Solon

 

6521 Davis

 

Industrial

 

 

128

 

529

 

71

 

128

 

600

 

728

 

78

 

1979

 

1997

 

Solon

 

30301 Carter Street

 

Industrial

 

 

650

 

4,974

 

231

 

650

 

5,204

 

5,855

 

821

 

1972

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ST. LOUIS PARK, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cedar Lake Business Center

 

Cedar Lake Business Center

 

Industrial

 

 

332

 

1,931

 

107

 

332

 

2,038

 

2,370

 

283

 

1976

 

1997

 

Minneapolis-West

 

1600 Tower

 

Office

 

 

2,321

 

31,868

 

1,705

 

2,321

 

33,574

 

35,894

 

2,736

 

2000

 

2000

 

North Plaza

 

North Plaza

 

Office

 

 

374

 

1,662

 

241

 

374

 

1,904

 

2,278

 

256

 

1966

 

1998

 

South Plaza

 

South Plaza

 

Office

 

 

397

 

1,730

 

95

 

397

 

1,826

 

2,222

 

281

 

1966

 

1998

 

Travelers Express Tower

 

Travelers Express Tower

 

Office

 

 

3,039

 

36,060

 

631

 

3,091

 

36,640

 

39,731

 

3,309

 

1987

 

1999

 

Novartis

 

Novartis Warehouse

 

Industrial

 

 

2,005

 

10,948

 

443

 

2,005

 

11,391

 

13,396

 

1,328

 

1960

 

1998

 

SW Submkt-Minneapolis West BC

 

5219 Building

 

Office

 

 

99

 

574

 

60

 

102

 

631

 

733

 

74

 

1965

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ST. LOUIS, MISSOURI

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Clayton

 

Interco Corporate Tower

 

Office

 

 

 

6,150

 

43,371

 

 

6,150

 

43,371

 

49,521

 

 

 

1986

 

2002

 

Craig Park Center

 

Craig Park Center

 

Industrial

 

 

254

 

2,309

 

220

 

254

 

2,529

 

2,783

 

283

 

1984

 

1998

 

Earth City

 

3300 Pointe 70

 

Office

 

4,143

 

1,186

 

7,586

 

618

 

1,186

 

8,204

 

9,390

 

1,146

 

1989

 

1997

 

Hawthorn Office Park

 

Hawthorn Office#1

 

Office

 

 

2,600

 

15,239

 

 

2,600

 

15,239

 

17,839

 

247

 

1997

 

2002

 

Lakeside Crossing

 

Lakeside Crossing I

 

Industrial

 

 

 

574

 

2,272

 

 

574

 

2,272

 

2,846

 

207

 

2001

 

2002

 

Lakeside Crossing

 

Lakeside Crossing III

 

Industrial

 

 

 

1,851

 

4,881

 

 

1,851

 

4,881

 

6,733

 

429

 

2001

 

2002

 

Lakeside Crossing

 

Lakeside Crossing 6

 

Industrial

 

 

 

1,074

 

2,125

 

 

1,074

 

2,125

 

3,199

 

8

 

2002

 

2002

 

Laumeier Office Park

 

Laumeier I

 

Office

 

 

1,384

 

10,063

 

1,344

 

1,384

 

11,408

 

12,791

 

2,113

 

1987

 

1995

 

Laumeier Office Park

 

Laumeier II

 

Office

 

 

1,421

 

10,033

 

847

 

1,421

 

10,879

 

12,300

 

2,100

 

1988

 

1995

 

Laumeier Office Park

 

Laumeier IV

 

Office

 

 

1,029

 

7,393

 

820

 

1,029

 

8,212

 

9,241

 

1,023

 

1987

 

1998

 

Maryville Center

 

500-510 Maryville Centre

 

Office

 

 

3,402

 

24,779

 

592

 

3,402

 

25,372

 

28,774

 

3,360

 

1984

 

1997

 

Maryville Center

 

530 Maryville Centre

 

Office

 

7,176

 

2,219

 

15,733

 

1,509

 

2,219

 

17,243

 

19,461

 

2,512

 

1990

 

1997

 

Maryville Center

 

550 Maryville Centre

 

Office

 

9,580

 

1,996

 

12,532

 

28

 

1,996

 

12,560

 

14,556

 

1,636

 

1988

 

1997

 

Maryville Center

 

635-645 Maryville Centre

 

Office

 

11,133

 

3,048

 

18,452

 

424

 

3,048

 

18,876

 

21,924

 

2,822

 

1987

 

1997

 

Maryville Center

 

655 Maryville Centre

 

Office

 

7,651

 

1,860

 

13,258

 

15

 

1,860

 

13,273

 

15,133

 

1,722

 

1994

 

1997

 

Maryville Center

 

540 Maryville Centre

 

Office

 

 

2,219

 

14,933

 

357

 

2,219

 

15,290

 

17,509

 

2,090

 

1990

 

1997

 

Maryville Center

 

520 Maryville Centre

 

Office

 

 

2,404

 

16,010

 

98

 

2,404

 

16,108

 

18,512

 

2,628

 

1998

 

1999

 

Maryville Center

 

700 Maryville Centre

 

Office

 

 

4,556

 

28,599

 

24

 

4,556

 

28,624

 

33,179

 

2,673

 

1999

 

2000

 

Maryville Center

 

533 Maryville Centre

 

Office

 

 

3,230

 

17,921

 

12

 

3,230

 

17,932

 

21,162

 

1,128

 

2000

 

2000

 

Maryville Center

 

555 Maryville Centre

 

Office

 

 

3,226

 

15,799

 

 

3,226

 

15,799

 

19,025

 

221

 

2000

 

2001

 

Maryville Center

 

625 Maryville Centre

 

Office

 

6,779

 

2,509

 

12,260

 

 

2,509

 

12,260

 

14,768

 

311

 

1996

 

2002

 

Riverport

 

Duke Fitness Centers LLC-STL

 

Grounds

 

 

 

 

21

 

 

 

21

 

21

 

 

 

 

2002

 

St. Louis Business Center

 

St. Louis Business Center A

 

Industrial

 

 

194

 

1,768

 

298

 

194

 

2,066

 

2,260

 

239

 

1987

 

1998

 

St. Louis Business Center

 

St. Louis Business Center B

 

Industrial

 

 

250

 

2,274

 

1,073

 

250

 

3,347

 

3,597

 

544

 

1986

 

1998

 

St. Louis Business Center

 

St. Louis Business Center C

 

Industrial

 

 

166

 

1,511

 

406

 

166

 

1,918

 

2,084

 

290

 

1986

 

1998

 

St. Louis Business Center

 

St. Louis Business Center D

 

Industrial

 

 

168

 

1,532

 

346

 

168

 

1,878

 

2,046

 

238

 

1987

 

1998

 

Southridge

 

Southridge Business Center

 

Industrial

 

 

 

1,158

 

4,234

 

 

1,158

 

4,234

 

5,392

 

161

 

2002

 

2002

 

West Port Center

 

Westport Center IV

 

Industrial

 

 

1,440

 

5,526

 

 

1,440

 

5,526

 

6,966

 

653

 

2000

 

2000

 

West Port Center

 

Westport Center V

 

Industrial

 

 

493

 

1,591

 

 

493

 

1,591

 

2,085

 

200

 

1999

 

2000

 

West Port Center

 

Westport Place

 

Office

 

 

1,990

 

7,824

 

259

 

1,990

 

8,083

 

10,073

 

1,296

 

1999

 

2000

 

Westmark

 

Westmark

 

Office

 

 

1,497

 

10,874

 

2,220

 

1,488

 

13,102

 

14,590

 

2,530

 

1987

 

1995

 

Westview Place

 

Westview Place

 

Office

 

 

669

 

9,357

 

1,782

 

669

 

11,139

 

11,808

 

2,253

 

1988

 

1995

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ST. PAUL, MINNESOTA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

University Crossing

 

University Crossing

 

Industrial

 

 

874

 

5,047

 

772

 

911

 

5,782

 

6,693

 

767

 

1990

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ST. PETERS, MISSOURI

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Horizon Business Ctr

 

Horizon Business Center

 

Industrial

 

 

344

 

2,483

 

165

 

344

 

2,649

 

2,993

 

310

 

1985

 

1998

 

 

66



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 

 

 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

STRONGSVILLE, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commerce Parkway

 

Commerce Parkway Bldg 1

 

 

 

 

 

594

 

3,754

 

 

594

 

3,754

 

4,348

 

23

 

2002

 

2002

 

Dymet

 

Dyment

 

 

 

 

 

816

 

5,368

 

39

 

816

 

5,406

 

6,223

 

754

 

1988

 

1997

 

Johnson Controls

 

Johnson Controls

 

 

 

 

 

364

 

2,401

 

75

 

364

 

2,476

 

2,840

 

346

 

1972

 

1997

 

Park 82

 

Park 82 Bldg 2

 

 

 

 

 

322

 

2,899

 

595

 

294

 

3,522

 

3,815

 

614

 

1998

 

1998

 

Park 82

 

Park 82 Bldg 1

 

 

 

 

 

243

 

1,968

 

280

 

215

 

2,276

 

2,491

 

346

 

1998

 

1998

 

Park 82

 

Park 82 Bldg 3

 

 

 

 

 

298

 

2,679

 

712

 

270

 

3,419

 

3,689

 

371

 

1999

 

1999

 

Park 82

 

Park 82 Bldg 4

 

 

 

 

 

360

 

5,466

 

95

 

357

 

5,564

 

5,921

 

453

 

2000

 

2000

 

Park 82

 

Park 82 Bldg 5

 

Industrial

 

 

351

 

4,424

 

150

 

349

 

4,577

 

4,925

 

188

 

2000

 

2000

 

Srague Rd. Industrial

 

Mohawk Dr. Bldg. 1

 

Industrial

 

 

564

 

4,456

 

 

564

 

4,456

 

5,020

 

221

 

2000

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUNRISE, FLORIDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sawgrass

 

Sawgrass Commerce Ctr Phase II

 

Office

 

 

1,147

 

6,112

 

 

1,147

 

6,112

 

7,260

 

424

 

2000

 

2001

 

Sawgrass

 

Sawgrass Pointe

 

Office

 

 

 

3,484

 

21,827

 

 

3,484

 

21,827

 

25,311

 

461

 

2001

 

2002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUWANEE, GEORGIA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TAMPA, FLORIDA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fairfield Distribution Center

 

Fairfield Distribution Ctr I

 

Industrial

 

 

483

 

2,658

 

3

 

487

 

2,657

 

3,144

 

237

 

1998

 

1999

 

Fairfield Distribution Center

 

Fairfield Distribution Ctr II

 

Industrial

 

 

530

 

4,901

 

11

 

534

 

4,908

 

5,441

 

436

 

1998

 

1999

 

Fairfield Distribution Center

 

Fairfield Distribution Ctr III

 

Industrial

 

 

334

 

2,771

 

39

 

338

 

2,806

 

3,144

 

243

 

1999

 

1999

 

Fairfield Distribution Center

 

Fairfield Distribution Ctr IV

 

Industrial

 

 

600

 

2,543

 

874

 

604

 

3,413

 

4,017

 

568

 

1999

 

1999

 

Fairfield Distribution Center

 

Fairfield Distribution Ctr V

 

Industrial

 

 

488

 

3,538

 

 

488

 

3,538

 

4,026

 

208

 

2000

 

2000

 

Fairfield Distribution Center

 

Fairfield Distribution Ctr VI

 

Industrial

 

 

555

 

4,517

 

 

555

 

4,517

 

5,072

 

187

 

2001

 

2001

 

Fairfield Distribution Center

 

Fairfield Distribution Ctr VII

 

Industrial

 

 

394

 

4,027

 

 

394

 

4,027

 

4,420

 

244

 

2001

 

2001

 

Highland Oaks

 

Highland Oaks I

 

Office

 

 

1,525

 

14,176

 

450

 

1,525

 

14,625

 

16,150

 

2,020

 

1999

 

1999

 

Highland Oaks

 

Highland Oaks II

 

Office

 

 

1,605

 

11,820

 

 

1,605

 

11,820

 

13,425

 

747

 

1999

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TWINSBURG, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Enterprise Parkway

 

Enterprise Parkway #1

 

Industrial

 

 

198

 

1,585

 

190

 

198

 

1,774

 

1,972

 

195

 

1974

 

1998

 

Enterprise Parkway

 

Enterprise Parkway Bldg 2

 

Industrial

 

 

610

 

7,391

 

5

 

610

 

7,396

 

8,006

 

570

 

2000

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WEST CHESTER, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

World Park Union Centre

 

World Park at Union Ctr 12

 

Industrial

 

 

306

 

3,461

 

 

306

 

3,461

 

3,767

 

397

 

2000

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WESTERVILLE, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Westerville Executive Campus

 

Liebert

 

Office

 

 

755

 

4,510

 

903

 

755

 

5,413

 

6,169

 

1,217

 

1999

 

1999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WESTMONT, ILLINOIS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oakmont Corporate Center

 

Oakmont Tech Center

 

Industrial

 

 

1,501

 

8,712

 

152

 

1,501

 

8,864

 

10,365

 

921

 

1989

 

1998

 

Oakmont Corporate Center

 

Oakmont Circle Office

 

Office

 

 

3,177

 

14,187

 

1,060

 

3,492

 

14,932

 

18,424

 

1,664

 

1990

 

1998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WOODLAWN, OHIO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Glenwood Crossing

 

Glenwood Crossing

 

Retail

 

 

3,651

 

1,383

 

228

 

3,651

 

1,610

 

5,262

 

117

 

1999

 

2000

 

 

 

McDonalds Ground Lease

 

Grounds

 

 

480

 

 

 

480

 

 

480

 

 

 

 

2000

 

 

 

Eliminations

 

 

 

 

 

 

 

(23,751

)

(750

)

(23,002

)

(23,751

)

1,294

 

 

 

 

 

 

 

MV Construction Loan Payable

 

 

 

23,895

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

299,147

 

600,885

 

4,037,690

 

207,780

 

608,995

 

4,237,360

 

4,846,355

 

555,858

 

 

 

 

 

 


(1) Depreciation of real estate is computed using the straight-line method over 40 years for buildings, 15 years for land
improvements and shorter periods based on lease terms (generally 3 to 10 years) for tenant improvements.

 

67



 

Development

 

Name

 

Building
Type

 

Encumbrances

 




 

Cost Capitalized
Subsequent to
Development
to Acquisition

 



 

Accumulated
Depreciation(1)

 

Year
Constructed

 

Year
Acquired

 

 

 

 

 

 

 

 

 

Initial Cost

Gross Book Value 12/31/02

Land

 

Buildings

Land/Land Imp

 

Bldgs/TI

 

Total

 

 

 

 

Real Estate Assets

 

 

 

Accumulated Depreciation

 

 

 

 

 

2002

 

 

 

2001

 

 

 

2000

 

 

 

2002

 

 

 

2001

 

 

 

2000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of year

 

 

 

$

 4,652,853

 

 

 

$

 4,570,563

 

 

 

$

 4,726,906

 

 

 

$

 425,721

 

 

 

$

 338,426

 

 

 

$

 254,574

 

Acquisitions

 

 

 

137,706

 

 

 

13,927

 

 

 

6,104

 

 

 

 

 

 

 

 

 

 

Construction costs and tenant improvements

 

 

 

275,020

 

 

 

467,285

 

 

 

603,194

 

 

 

 

 

 

 

 

 

 

Depreciation expense

 

 

 

 

 

 

 

 

 

 

 

 

154,565

 

 

 

138,723

 

 

 

143,800

 

Acquisition of minority interest

 

 

 

13,163

 

 

 

4,259

 

 

 

1,317

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5,078,742

 

 

 

5,056,034

 

 

 

5,337,521

 

 

 

580,286

 

 

 

477,149

 

 

 

398,374

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deductions during year:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of real estate sold or contributed

 

 

 

(204,248

)

 

 

(386,495

)

 

 

(745,554

)

 

 

(5,668

)

 

 

(39,542

)

 

 

(39,085

)

Impairment Allowance

 

 

 

(9,379

)

 

 

(4,800

)

 

 

(541

)

 

 

 

 

 

 

 

 

 

 

 

 

Write-off of fully amortized assets

 

 

 

(18,760

)

 

 

(11,886

)

 

 

(20,863

)

 

 

(18,760

)

 

 

(11,886

)

 

 

(20,863

)

Balance at end of year

 

 

 

$

 4,846,355

 

 

 

$

 4,652,853

 

 

 

$

 4,570,563

 

 

 

$

 555,858

 

 

 

$

 425,721

 

 

 

$

 338,426

 

 

68



 

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.

 

 

 

 

 

DUKE REALTY LIMITED PARTNERSHIP

 

 

 

 

By:

 Duke Realty Corporation

 

 

 

 

 

 

Its General Partner

 

 

 

 

 

 

 

March 25, 2003

By:

/s/  Thomas L. Hefner

 

 

 

 

 

Thomas L. Hefner

 

 

 

 

Chairman of the Board,

 

 

 

 

President and Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Darell E. Zink, Jr.

 

 

 

 

 

Darell E. Zink, Jr.

 

 

 

 

Executive Vice President and

 

 

 

 

Chief Financial Officer

 

 

 

 

(Principal Financial Officer)

 

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Matthew A. Cohoat

 

 

 

 

 

Matthew A. Cohoat

 

 

 

 

Senior Vice President and

 

 

 

 

Corporate Controller

 

 

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.

 

Signature

 

Date

 

Title

 

 

 

 

 

/s/ Thomas L. Hefner*

 

3/25/03

 

Chairman of the Board,

Thomas L. Hefner

 

 

 

President and Chief Executive

Officer and Director of the
General Partner

 

 

 

 

 

/s/ Darell E. Zink, Jr.*

 

3/25/03

 

Executive Vice President and Chief

Darell E. Zink, Jr.

 

 

 

Financial Officer and Director of the
General Partner

 

 

 

 

 

/s/ Matthew A. Cohoat*

 

3/25/03

 

Senior Vice President and

Matthew A. Cohoat

 

 

 

Corporate Controller of the
General Partner

 

69



 

/s/ Barrington H. Branch*

 

3/25/03

 

Director of the General Partner

Barrington H. Branch

 

 

 

 

 

 

 

 

 

/s/ Gary A. Burk

 

3/25/03

 

Director of the General Partner

Gary A. Burk

 

 

 

 

 

 

 

 

 

/s/ Geoffrey Button*

 

3/25/03

 

Director of the General Partner

Geoffrey Button

 

 

 

 

 

 

 

 

 

/s/ William Cavanaugh, III*

 

3/25/03

 

Director of the General Partner

William Cavanaugh, III

 

 

 

 

 

 

 

 

 

/s/ Ngaire E. Cuneo*

 

3/25/03

 

Director of the General Partner

Ngaire E. Cuneo

 

 

 

 

 

 

 

 

 

/s/ Charles R. Eitel*

 

3/25/03

 

Director of the General Partner

Charles R. Eitel

 

 

 

 

 

 

 

 

 

/s/ L. Ben Lytle*

 

3/25/03

 

Director of the General Partner

L. Ben Lytle

 

 

 

 

 

 

 

 

 

/s/ William O. McCoy*

 

3/25/03

 

Director of the General Partner

William O. McCoy

 

 

 

 

 

 

 

 

 

/s/ John W. Nelley, Jr.*

 

3/25/03

 

Director of the General Partner

John W. Nelley, Jr.

 

 

 

 

 

 

 

 

 

/s/ James E. Rogers*

 

3/25/03

 

Director of the General Partner

James E. Rogers

 

 

 

 

 

 

 

 

 

/s/ Robert J. Woodward*

 

3/25/03

 

Director of the General Partner

Robert J. Woodward

 

 

 

 

 


* By Dennis D. Oklak, Attorney-in-Fact

/s/ Dennis D. Oklak

 

 

70



 

 

SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS

FILED PURSUANT TO SECTION 15(d) OF THE ACT BY REGISTRANTS

WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO SECTION 12

OF THE ACT

 

 

No annual report or proxy statement has been sent to security holders of the Registrant. The General Partner of the Registrant has mailed its annual report and its proxy statement to holders of common stock of the General Partner. Portions of the General Partner’s proxy statement are incorporated by reference herein in Items 10-13 of Part III.

 



 

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Thomas L. Hefner, certify that:

 

1.             I have reviewed this annual report on Form 10-K of Duke Realty Limited Partnership;

 

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 Partnership as of, and for, the periods presented in this annual report;

 

4.                                       The Partnership’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 we have:

 

(a)               designed such disclosure controls and procedures to ensure that material information relating to the Partnership, 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 Partnership’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 Partnership’s other certifying officers and I have disclosed, based on our most recent evaluation, to the Partnership’s auditors and the audit committee of the General Partner’s board of directors (or persons performing the equivalent function):

 

(a)               all significant deficiencies in the design or operation of internal controls which could adversely affect the Partnership’s ability to record, process, summarize and report financial data and have identified for the Partnership’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 Partnership’s internal controls; and

 

6.                                       The Partnership’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 25, 2003

 

 

 

Thomas L. Hefner

President and Chief Executive Officer
of the General Partner

 



 

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Darell E. Zink, Jr., certify that:

 

1.             I have reviewed this annual report on Form 10-K of Duke Realty Limited Partnership;

 

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 Partnership as of, and for, the periods presented in this annual report;

 

4.                                       The Partnership’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 Partnership and we have:

 

(a)               designed such disclosure controls and procedures to ensure that material information relating to the Partnership, 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 Partnership’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 Partnership’s other certifying officers and I have disclosed, based on our most recent evaluation, to the Partnership’s auditors and the audit committee of the General Partner's board of directors (or persons performing the equivalent function):

 

(a)               all significant deficiencies in the design or operation of internal controls which could adversely affect the Partnership’s ability to record, process, summarize and report financial data and have identified for the Partnership’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 Partnership’s internal controls; and

 

6.                                       The Partnership’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 25, 2003

 

 

 

Darell E. Zink, Jr.

Executive Vice President and Chief Financial Officer
of the General Partner