10-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

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

For the fiscal year ended December 31, 2008

OR

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

For the transition period from                      to                     

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

LIBERTY PROPERTY TRUST LIBERTY PROPERTY LIMITED PARTNERSHIP

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

MARYLAND (Liberty Property Trust) PENNSYLVANIA (Liberty Property Limited Partnership)	23-7768996 23-2766549
(State or Other Jurisdiction	(I.R.S. Employer
of Incorporation or Organization)	Identification Number)

500 Chesterfield Parkway
Malvern, Pennsylvania	19355
(Address of Principal Executive Offices)	(Zip Code)
Registrants’ Telephone Number, including Area Code	(610) 648-1700

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

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

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

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

YES þ      NO o

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.

YES o      NO þ

Indicate by check mark whether the Registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrants were required to file such reports) and (2) have been subject to such filing requirements for the past ninety (90) days.

YES þ      NO o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K is not contained herein, and will not be contained, to the best of the Registrants’ knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. þ

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

Large Accelerated Filer þ	Accelerated Filer o	Non-Accelerated Filer o	Smaller reporting company o
	(Do not check if a smaller reporting company)

Indicate by check mark if the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES o      NO þ

The aggregate market value of the Common Shares of Beneficial Interest, $0.001 par value (the “Common Shares”), of Liberty Property Trust held by non-affiliates of Liberty Property Trust was $3.1 billion, based upon the closing price of $33.15 on the New York Stock Exchange composite tape on June 30, 2008. Non-affiliate ownership is calculated by excluding all Common Shares that may be deemed to be beneficially owned by executive officers and trustees, without conceding that any such person is an “affiliate” for purposes of the federal securities laws.

Number of Common Shares outstanding as of February 23, 2009: 101,348,063

Documents Incorporated by Reference

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

INDEX

	Page
Part I
Item 1. Business		4
Item 1A. Risk Factors		8
Item 1B. Unresolved Staff Comments		17
Item 2. Properties		17
Item 3. Legal Proceedings		20
Item 4. Submission of Matters to a Vote of Security Holders		22
Part II
Item 5. Market for Registrants’ Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities		23
Item 6. Selected Financial Data		24
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations		26
Item 7A. Quantitative and Qualitative Disclosures About Market Risk		40
Item 8. Financial Statements and Supplementary Data		40
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		121
Item 9A. Controls and Procedures		121
Item 9B. Other Information		121
Part III
Item 10. Trustees, Executive Officers and Corporate Governance		122
Item 11. Executive Compensation		122
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters		122
Item 13. Certain Relationships and Related Transactions, and Trustee Independence		122
Item 14. Principal Accountant Fees and Services		122
Part IV
Item 15. Exhibits and Financial Statement Schedules		123
Signatures for Liberty Property Trust		132
Signatures for Liberty Property Limited Partnership		133
Exhibit Index		134
Amended and Restated Schedule A
Liberty Property Trust – Amended Management Severance Plan
Statement re: Computation of Ratios
Subsidiaries
Consent of Ernst & Young LLP relating to the Trust
Consent of Ernst & Young LLP relating to the Operating Partnership
Certifications of the Chief Executive Officer
Certifications of the Chief Financial Officer
Certifications of the Chief Executive Officer, in its capacity as the general partner
Certifications of the Chief Financial Officer in its capacity as the general partner
Certifications of the Chief Executive Officer, required under Rule 13a-14(b)
Certifications of the Chief Financial Officer, required under Rule 13a-14(b)
Certifications of the Chief Executive Officer, in its capacity as the general partner, required by Rule 13-a-14(b)
Certifications of the Chief Financial Officer, in its capacity as the general partner, required by Rule 13a-14(b)
Portions of the Proxy Statement for the Liberty Property Trust 2008 Annual Meeting of Shareholders
EX-3.1.24
EX-10.9
EX-12
EX-21
EX-23.1
EX-23.2
EX-31.1
EX-31.2
EX-31.3
EX-31.4
EX-32.1
EX-32.2
EX-32.3
EX-32.4
EX-99.1

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The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Certain information included in this Annual Report on Form 10-K and other materials filed or to be filed by the Company (as defined herein) with the Securities and Exchange Commission (“SEC”) (as well as information included in oral statements or other written statements made or to be made by the Company) contain statements that are or will be forward-looking, such as statements relating to rental operations, business and property development activities, joint venture relationships, acquisitions and dispositions (including related pro forma financial information), future capital expenditures, financing sources and availability, litigation and the effects of regulation (including environmental regulation) and competition. These forward-looking statements generally are accompanied by words such as “believes,” “anticipates,” “expects,” “estimates,” “should,” “seeks,” “intends,” “planned,” “outlook” and “goal” or similar expressions. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be achieved. As forward-looking statements, these statements involve important risks, uncertainties and other factors that could cause actual results to differ materially from the expected results and, accordingly, such results may differ from those expressed in any forward-looking statements made by, or on behalf of the Company. The Company assumes no obligation to update or supplement forward looking statements that become untrue because of subsequent events. These risks, uncertainties and other factors include, without limitation, uncertainties affecting real estate businesses generally (such as entry into new leases, renewals of leases and dependence on tenants’ business operations), risks relating to our ability to maintain and increase property occupancy and rental rates, risks relating to the current cycle of deleveraging and related pressure on asset prices, risks relating to the current credit crisis and economic decline, risks relating to construction and development activities, risks relating to acquisition and disposition activities, risks relating to the integration of the operations of entities that we have acquired or may acquire, risks relating to joint venture relationships and any possible need to perform under certain guarantees that we have issued or may issue in connection with such relationships, possible environmental liabilities, risks relating to leverage and debt service (including availability of financing terms acceptable to the Company and sensitivity of the Company’s operations and financing arrangements to fluctuations in interest rates), dependence on the primary markets in which the Company’s properties are located, the existence of complex regulations relating to status as a REIT and the adverse consequences of the failure to qualify as a REIT, risks relating to litigation, including without limitation litigation involving entities that we have acquired or may acquire, and the potential adverse impact of market interest rates on the market price for the Company’s securities. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Forward-Looking Statements.”

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PART I

ITEM 1. BUSINESS

The Company

Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (a “REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the “Operating Partnership” and, together with the Trust and their consolidated subsidiaries, the “Company”).

The Company completed its initial public offering in 1994 to continue and expand the commercial real estate business of Rouse & Associates, a Pennsylvania general partnership, and certain affiliated entities (collectively, the “Predecessor”), which was founded in 1972. As of December 31, 2008, the Company owned and operated 357 industrial and 297 office properties (the “Wholly Owned Properties in Operation”) totaling 63.8 million square feet. In addition, as of December 31, 2008, the Company owned 17 properties under development, which when completed are expected to comprise 3.2 million square feet (the “Wholly Owned Properties under Development”) and 1,336 acres of developable land, substantially all of which is zoned for commercial use. Additionally, as of December 31, 2008 the Company had an ownership interest, through unconsolidated joint ventures, in 46 industrial and 49 office properties totaling 13.1 million square feet (the “JV Properties in Operation” and, together with the Wholly Owned Properties in Operation, the “Properties in Operation”), four properties under development, which when completed are expected to comprise 1.4 million square feet (the “JV Properties under Development” and, together with the Wholly Owned Properties under Development, the “Properties under Development” and, together with the Properties in Operation, the “Properties”) and 648 acres of developable land, substantially all of which is zoned for commercial use.

The Company provides leasing, property management, development and other tenant-related services for the Properties. The Company’s industrial Properties consist of a variety of warehouse, distribution, service, assembly, light manufacturing and research and development facilities. They include both single-tenant and multi-tenant facilities, with most designed flexibly to accommodate various types of tenants, space requirements and industrial uses. The Company’s office Properties are multi-story and single-story office buildings located principally in suburban mixed-use developments or office parks. Substantially all of the Company’s Properties are located in prime business locations within established business communities. In addition, the Company, individually or through joint ventures, owns urban office properties in Philadelphia and Washington, D.C. Going forward the Company’s product and market selection will favor metro-office, multi-tenant industrial and flex properties and markets with strong demographic and economic fundamentals.

The Trust is the sole general partner and also a limited partner of the Operating Partnership, owning 96.0% of the common equity of the Operating Partnership at December 31, 2008. The common units of limited partnership interest in the Operating Partnership (the “Common Units”), other than those owned by the Trust, are exchangeable on a one-for-one basis (subject to anti-dilution protections) for the Trust’s Common Shares of Beneficial Interest, $0.001 par value per share (the “Common Shares”). As of December 31, 2008, the Common Units held by the limited partners were exchangeable for 4.1 million Common Shares. The Company has issued several series of Cumulative Redeemable Preferred Units of the Operating Partnership (the “Preferred Units”). The outstanding Preferred Units of each series are exchangeable on a one-for-one basis after stated dates into a corresponding series Cumulative Redeemable Preferred Shares of the Trust. Collectively, the ownership of the holders of Common and Preferred Units is reflected on the Trust’s financial statements as minority interest.

In addition to this Annual Report on Form 10-K, the Company files with or furnishes to the SEC periodic and current reports, proxy statements and other information. The Company makes these documents available on its website, www.libertyproperty.com, free of charge, as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. Any document the Company files with or furnishes to the SEC is available to read and copy at the SEC’s Public Reference Room at 100 F Street, NE, Room 1580, Washington, DC 20549. Further information about the public reference facilities is available by calling the SEC at (800) SEC-0330. These documents also may be accessed on the SEC’s web site, http://www.sec.gov. 

Also posted on the Company’s website is the Company’s Code of Conduct, which applies to all of its employees and also serves as a code of ethics for its chief executive officer, chief financial officer and persons performing similar functions. The Company will send the Code of Conduct, free of charge, to anyone who requests a copy in writing

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from its Investor Relations Department at the address set forth on the cover of this filing. The Company intends to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding any amendments to or waivers of the Code of Conduct by posting the required information in the Corporate Governance section of its website.

Management and Employees

The Company’s 481 employees (as of February 23, 2009) operate under the direction of 19 senior executives, who have been affiliated with the Company and the Predecessor for 17 years, on average. The Company and the Predecessor have developed and managed commercial real estate for the past 36 years. The Company maintains an in-house leasing and property management staff which enables the Company to better understand the characteristics of the local markets in which it operates, to respond quickly and directly to tenant needs and to better identify local real estate opportunities. At December 31, 2008, the Company’s reportable segments were based on the Company’s method of internal reporting and are as follows:

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

Business Objective and Strategies for Growth

The Company’s business objective is to maximize long-term profitability for its shareholders by being a recognized leader in commercial real estate through the ownership, management, development and acquisition of superior office and industrial properties. The Company intends to achieve this objective through offering office and industrial properties in multiple markets and operating as a leading landlord in the industry. The Company believes that this objective will provide the benefits of enhanced investment opportunities, economies of scale, risk diversification both in terms of geographic market and real estate product type, access to capital and the ability to attract and retain personnel. The Company also strives to be a leading provider of customer service, providing an exceptional and positive customer experience. The Company seeks to be an industry leader in sustainable development and to operate an energy-efficient portfolio. In pursuing its business objective, the Company seeks to achieve a combination of internal and external growth, maintain a conservative balance sheet and pursue a strategy of financial flexibility.

Products

The Company strives to be a recognized quality provider of five products (industrial properties, including big box warehouse, multi-tenant industrial, and flex/R&D; and office properties, including single-story office and multi-story office). Going forward the Company’s product selection will favor metro-office, multi-tenant industrial and flex properties. Going forward the Company’s market selection will favor markets with strong demographic and economic fundamentals. Consistent with the Company’s strategy and market opportunities, the Company may pursue office and industrial products other than those noted above.

Markets

The Company operates primarily in the Mid-Atlantic, Southeastern, Midwestern and Southwestern United States. Additionally, the Company owns certain assets in the United Kingdom. The Company’s goal is to operate in each of its markets with an appropriate product mix of office and industrial properties. In some markets it may offer only one of its product types. Generally, the Company seeks to have a presence in each market sufficient for the Company to be viewed as a significant participant in each market. The Company’s efforts emphasize business park development and asset aggregation. The Company gathers information from internal sources and independent third parties and analyzes this information to support its evaluation of markets and market conditions.

Organizational Plan

The Company seeks to maintain a management organization that facilitates efficient execution of the Company’s strategy. As part of this effort, the Company pursues a human resources plan designed to create and maintain a highly regarded real estate company through recruiting, training and retaining capable people. The structure is designed to support a local office entrepreneurial platform operating within a value-added corporate structure. The Company upgrades its information technology periodically to keep pace with advances in available technology.

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Internal Growth Strategies

The Company seeks to maximize the profitability of its Properties by endeavoring to maintain high occupancy levels while obtaining competitive rental rates, controlling costs and focusing on customer service efforts.

Maintain High Occupancies

The Company believes that the quality and diversity of its tenant base and its strategy of operating in multiple markets is integral to achieving its goal of attaining high occupancy levels for its portfolio. The Company targets financially stable tenants in an effort to minimize uncertainty relating to the ability of the tenants to meet their lease obligations.

Cost Controls

The Company seeks to identify best practices to apply throughout the Company in order to enhance cost savings and other efficiencies. The Company also employs an annual capital improvement and preventative maintenance program designed to reduce the operating costs of the Properties in Operation and maintain the long-term value of the Properties in Operation.

Customer Service

The Company seeks to achieve high tenant retention through a comprehensive customer service program, which is designed to provide an exceptional and positive customer experience. The customer service program establishes best practices and provides an appropriate customer feedback process. The Company believes that the program has been helpful in increasing customer satisfaction.

Energy Efficiency Initiatives

The Company is committed to improving the energy efficiency of the existing buildings in its portfolio and has made a substantial effort to design environmentally friendly features in the buildings it develops.

The Company has been an active participant in the U.S. Green Building Council’s Leadership in Energy and Environmental Design (“LEED”) program. The LEED program, which was created to recognize environmental leadership in the building industry, establishes a voluntary, consensus-based national standard for developing high-performance, sustainable buildings. The Company currently has over seven million square feet of LEED projects completed or under construction, including the 1.25 million square foot Comcast Center.

The Company believes that building in accordance with LEED standards is environmentally responsible and can lead to significant operating efficiencies. The Company believes that green building techniques such as construction waste management (recycling waste onsite); energy conservation (occupancy sensors associated with lighting and high performance HVAC systems); and improvement of environmental quality (maximization of daylight and use of low-emitting materials) can result in positive environmental results and significant economic returns to tenants in terms of savings in operating costs and improved employee performance.

The Company has also taken significant steps to measure the energy efficiency of the existing buildings in the portfolio and to move forward with efforts to improve the energy efficiency of the buildings in the portfolio. These efforts have included, in various cases: (1) conducting energy audits; (2) performing lighting retrofits and installing lighting controls; (3) installing building automation systems; (4) installing improvements designed to increase energy efficiency; and (5) establishing and implementing a green property management guide and green training program.

The Company’s efforts in this area are ongoing. The Company intends to continue to explore methods of enhancing the performance of the buildings in its existing portfolio.

External Growth Strategies

The Company seeks to enhance its long-term profitability through the development, acquisition and disposition of properties either directly or through joint ventures. The Company also considers acquisitions of real estate operating companies.

However, current market conditions are not favorable for the development, acquisition and disposition of properties and consequently the Company expects growth in profitability from these sources to be limited at least in the near term.

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Wholly Owned Properties

Development

The Company pursues attractive development opportunities, focusing primarily on high-quality suburban industrial and office properties within its existing markets. When the Company’s marketing efforts identify opportunities, the Company will consider pursuing opportunities outside of the Company’s established markets. The Company and its Predecessor have developed over 59 million square feet of commercial real estate during the past 36 years. The Company’s development activities generally fall into two categories: build-to-suit projects and projects built for inventory (projects that are less than 75% leased prior to commencement of construction). The Company develops build-to-suit projects for existing and new tenants. The Company also builds properties for inventory where the Company has identified sufficient demand at market rental rates to justify such construction.

During the year ended December 31, 2008, the Company completed three build-to-suit projects and 14 inventory projects totaling 3.2 million square feet and representing an aggregate Total Investment, as defined below, of $217.0 million. As of December 31, 2008, these completed development properties were 61.2% leased. The “Total Investment” for a Property is defined as the Property’s purchase price plus closing costs and management’s estimate, as determined at the time of acquisition, of the cost of necessary building improvements in the case of acquisitions, or land costs and land and building improvement costs in the case of development projects, and, where appropriate, other development costs and carrying costs.

As of December 31, 2008, the Company had 17 Wholly Owned Properties under Development, which are expected to comprise, upon completion, 3.2 million square feet and are expected to represent a Total Investment of $373.6 million. These Wholly Owned Properties under Development were 63.0% pre-leased as of December 31, 2008. The scheduled deliveries of the 3.2 million square feet of Wholly Owned Properties under Development are as follows (in thousands, except percentages):

	Square Feet								Percent Leased			Total
Scheduled In-Service Date	Ind-Dist.		Ind-Flex		Office		Total		December 31, 2008			Investment
1st Quarter 2009		—		—		90		90		85.9	%	$	16,321
2nd Quarter 2009		920		126		78		1,124		52.0	%		71,893
3rd Quarter 2009		100		69		333		502		13.6	%		88,723
4th Quarter 2009		961		—		177		1,138		95.2	%		126,212
2nd Quarter 2010		—		—		95		95		72.3	%		24,206
4th Quarter 2010		—		—		211		211		50.8	%		46,245
Total		1,981		195		984		3,160		63.0	%	$	373,600

The Company believes that, because it is a fully integrated real estate firm, its base of commercially zoned land in existing industrial and office business parks provides a competitive advantage for future development activities. As of December 31, 2008, the Company owned 1,336 acres of land held for development, substantially all of which is zoned for commercial use. Substantially all of the land is located adjacent to or within existing industrial or business parks with site improvements, such as public sewers, water and utilities, available for service. The Company anticipates that its land holdings would support, as and when developed, 13.6 million square feet of property. The Company’s investment in land held for development as of December 31, 2008 was $209.6 million.

Through a development agreement with Kent County Council, the Company develops commercial buildings at Kings Hill, a 650-acre mixed use development site in the County of Kent, England.  The Company also is the project manager for the installation of infrastructure on the site and receives a portion of the proceeds from the sale of land parcels to home builders.  The site has planning consent for 2.0 million square feet of commercial space and 2,750 homes, of which approximately 800,000 square feet of commercial space and 2,100 homes have now been completed.

Acquisitions/Dispositions

The Company seeks to acquire properties consistent with its business objectives and strategies. The Company executes its acquisition strategy by purchasing properties that management believes will create shareholder value over the long-term.

During the year ended December 31, 2008, the Company acquired one property comprising 107,000 square feet for a Total Investment of $17.0 million.

The Company disposes of properties and land held for development that no longer fit within the Company’s strategic plan, or with respect to which the Company believes it can optimize cash proceeds. During the year ended December

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31, 2008, the Company sold 13 operating properties, which contained 665,000 square feet, and 24 acres of land, for aggregate proceeds of $83.0 million.

Joint Venture Properties

The Company, from time to time, considers joint venture opportunities with institutional investors or other real estate companies. Joint venture partnerships provide the Company with additional sources of capital to share investment risk and fund capital requirements. In some instances, joint venture partnerships provide the Company with additional local market or product type expertise.

As of December 31, 2008, the Company had investments in and advances to unconsolidated joint ventures totaling $266.6 million (see Note 4 to the Company’s Consolidated Financial Statements).

Development

During the year ended December 31, 2008, unconsolidated joint ventures in which the Company held an interest completed three inventory projects totaling 351,000 square feet and representing a Total Investment of $42.5 million. As of December 31, 2008, these completed development properties were 65.9% leased. Additionally, the final 306,000 square feet of Comcast Center (owned by a joint venture in which the Company has a 20% interest), representing a Total Investment of $124.1 million, were brought into service.

As of December 31, 2008, unconsolidated joint ventures in which the Company held an interest had four JV Properties under Development which are expected to comprise, upon completion, 1.4 million leaseable square feet and are expected to represent a Total Investment of $186.4 million. These JV Properties under Development were 38.1% pre-leased as of December 31, 2008.

As of December 31, 2008, unconsolidated joint ventures in which the Company held an interest owned 648 acres of land held for development, substantially all of which is zoned for commercial use. Substantially all of the land is located adjacent to or within existing industrial or business parks with site improvements, such as public sewers, water and utilities, available for service. The Company anticipates that its joint venture land holdings would support, as and when developed, 6.5 million square feet of property.

Acquisitions/Dispositions

During the year ended December 31, 2008, none of the unconsolidated joint ventures in which the Company held an interest acquired any properties.

During the year ended December 31, 2008, a joint venture in which the Company held a 50% interest realized proceeds of $1.4 million from the sale of one acre of land.

ITEM 1A. RISK FACTORS

The Company’s results of operations and the ability to make distributions to our shareholders and service our indebtedness may be affected by the risk factors set forth below. (The Company refers to itself as “we”, “us” or “our” in the following risk factors.) This section contains some forward looking statements. You should refer to the explanation of the qualifications and limitations on forward-looking statements on page 28.

Risks Related to Our Business

Recent turmoil in the global credit markets and current economic downturn could adversely affect our business and financial condition.

The Company’s business is subject to the risks in this section. Current economic conditions have increased the probability the Company will experience these risks. Recent turmoil in the global credit markets and declines and continuing weakness in the general economy have negatively impacted the Company’s normal business practices, particularly its financing activities.

We have historically relied on access to the credit markets in the conduct of our business. In particular, we currently utilize a $600 million credit facility, and additionally, we have, as of December 31, 2008, $2.1 billion of senior unsecured debt and $198.6 million of secured debt. Our credit facility expires in January 2010, subject to a right to extend for a one-year period. Although we are not aware of any instances in which banks participating in the credit facility have been unable or unwilling to participate in draws under the facility, it is possible that the financial issues confronting the banking industry could lead to such an occurrence. If such a circumstance occurred it is possible that

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the Company could not access the full amount which is supposed to be available under the credit facility. Additionally, if the financial issues confronting the banking industry persist it is possible that the amount and terms available for a renewal of the credit facility could be adversely impacted. Our secured and unsecured debt matures at various times between 2009 and 2019. Only a small portion of the principal of our debt is repaid prior to maturity. Therefore, we generally need to refinance our outstanding debt as it matures. In 2009, we have $270 million of senior unsecured debt and $41.8 million of secured debt maturing.

The circumstances noted above have adversely impacted liquidity in the debt markets, making financing terms for borrowers less attractive, and in certain cases resulting in the practicable unavailability of certain types of debt financing. For example, the market for senior unsecured debt financing has been generally unavailable to REITs during 2008. We anticipate that the senior unsecured debt market will be unavailable for the remainder of 2009. As a consequence, we have shifted our financing strategy to include more secured debt.

In addition to our reliance on access to credit markets in the conduct of our business, we have relied on the proceeds from the sale of our real estate assets to fund our growth opportunities. The absence of available financing to facilitate purchase and sale transactions has reduced our ability to rely on the proceeds to fund our growth opportunities.

Additionally, to the extent that credit continues to be less available than in the past and/or more costly than in the past, this state of affairs will likely have an adverse impact on the value of commercial real estate. Uncertainty in the markets about the pricing of real estate has also reduced our ability to rely on the sale of our real estate assets to fund our growth opportunities.

The dramatic and pervasive nature of the economic downturn engendered by the “credit crisis” has resulted in substantial job losses and financial stress to the businesses which form our tenant base. Although the Company endeavors to lease to credit-worthy tenants and has historically experienced relatively few defaults due to tenant bankruptcy, in this economic environment the Company may sustain substantially increased tenant defaults due to bankruptcy or otherwise. Such losses may be greater than expected and may result in a material diminution in the income generated by the Company’s portfolio.

Recent developments in the general economy have affected some of our existing tenants, and could have an adverse impact on our ability to collect rent or renew leases with these tenants, resulting in a negative effect on our cash flow from operations.

Recent developments in the general economy and the global credit markets have had a significant adverse effect on many companies in numerous industries, particularly the financial services and banking industries. We have tenants in these and other industries which may be experiencing these adverse effects. Should any of our tenants that may experience a downturn in its business that weakens its financial condition, delay lease commencement, fail to make rental payments when due, become insolvent or declare bankruptcy, the result could be a termination of the tenant’s lease and material losses to us. Our cash flow from operations and our ability to make expected distributions to our shareholders and service our indebtedness could, in such a case, be adversely affected.

Unfavorable events affecting our existing tenants, or negative market conditions that may affect our existing tenants, could have an adverse impact on our ability to attract new tenants, relet space, collect rent or renew leases, and thus could have a negative effect on our cash flow from operations.

Our cash flow from operations depends on our ability to lease space to tenants on economically favorable terms. Therefore, we could be adversely affected by various facts and events over which we have limited control, such as:

§	lack of demand for space in the areas where our Properties are located
§	inability to retain existing tenants and attract new tenants
§	oversupply of or reduced demand for space and changes in market rental rates
§	defaults by our tenants or their failure to pay rent on a timely basis
§	the need to periodically renovate and repair our space
§	physical damage to our Properties
§	economic or physical decline of the areas where our Properties are located
§	potential risk of functional obsolescence of our Properties over time

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If a tenant is unable to pay rent due to us, we may be forced to evict such tenants, or engage in other remedies, which may be expensive and time consuming and may adversely affect our net income, shareholders’ equity and cash distributions to shareholders.

At any time, any of our tenants may experience a downturn in its business that may weaken its financial condition. As a result, a tenant may delay lease commencement, fail to make rental payments when due, decline to extend a lease upon its expiration, become insolvent or declare bankruptcy. Any tenant bankruptcy or insolvency, leasing delay or failure to make rental payments when due could result in the termination of the tenant’s lease and material losses to our Company.

If our tenants do not renew their leases as they expire, we may not be able to rent the space. Furthermore, leases that are renewed, and some new leases for space that is relet, may have terms that are less economically favorable to us than current lease terms, or may require us to incur significant costs, such as for renovations, tenant improvements or lease transaction costs.

Any of these events could adversely affect our cash flow from operations and our ability to make expected distributions to our shareholders and service our indebtedness.

A significant portion of our costs, such as real estate taxes, insurance costs, and debt service payments, generally are not reduced when circumstances cause a decrease in cash flow from our Properties.

We may not be able to compete successfully with other entities that operate in our industry.

We experience a great deal of competition in attracting tenants for our Properties and in locating land to develop and properties to acquire.

In our effort to lease our Properties, we compete for tenants with a broad spectrum of other landlords in each of our markets. These competitors include, among others, publicly-held REITs, privately-held entities, individual property owners and tenants who wish to sublease their space. Some of these competitors may be able to offer prospective tenants more attractive financial or other terms than we are able to offer.

We may experience increased operating costs, which could adversely affect our operations.

Our Properties are subject to increases in operating expenses such as insurance, cleaning, electricity, heating, ventilation and air conditioning, general and administrative costs and other costs associated with security, landscaping, repairs and maintenance. While our current tenants generally are obligated to pay a significant portion of these costs, there is no assurance that these tenants will make such payments or agree to pay these costs upon renewal or that new tenants will agree to pay these costs. If operating expenses increase in our markets, we may not be able to increase rents or reimbursements in all of these markets so as to meet increased expenses without simultaneously decreasing occupancy rates. If this occurs, our ability to make distributions to shareholders and service our indebtedness could be adversely affected.

Our ability to achieve growth in operating income depends in part on our ability to develop properties, which may suffer under certain circumstances.

We intend to continue to develop properties when warranted by market conditions. However, current market conditions are not favorable for development and consequently we expect growth in operating income from development to be limited at least in the near term.

Additionally, our general construction and development activities include the risks that:

§	construction and leasing of a property may not be completed on schedule, which could result in increased expenses and construction costs, and would result in reduced profitability
§	construction costs may exceed our original estimates due to increases in interest rates and increased materials, labor or other costs, possibly making the property unprofitable because we may not be able to increase rents to compensate for the increase in construction costs
§	some developments may fail to achieve expectations, possibly making them unprofitable
§	we may be unable to obtain, or may face delays in obtaining, required zoning, land-use, building, occupancy, and other governmental permits and authorizations, which could result in increased costs and could require us to abandon our activities entirely with respect to a project

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§	we may abandon development opportunities after we begin to explore them and as a result, we may fail to recover costs already incurred. If we alter or discontinue our development efforts, past and future costs of the investment may need to be expensed rather than capitalized and we may determine the investment is impaired, resulting in a loss
§	we may expend funds on and devote management’s time to projects that we do not complete
§	occupancy rates and rents at newly completed properties may fluctuate depending on a number of factors, including market and economic conditions, and may result in lower than projected rental rates with the result that our investment is not profitable

We face risks associated with property acquisitions.

We acquire individual properties and portfolios of properties, in some cases through the acquisition of operating entities, and intend to continue to do so when circumstances warrant. However, current market conditions are not favorable for acquisitions and consequently we expect growth in operating income from acquisitions to be limited at least in the near term.

Additionally, our acquisition activities and their success are subject to the following risks:

§	when we are able to locate a desirable property, competition from other real estate investors may significantly increase the purchase price
§	acquired properties may fail to perform as expected
§	the actual costs of repositioning or redeveloping acquired properties may be higher than our estimates
§	acquired properties may be located in new markets where we face risks associated with an incomplete knowledge or understanding of the local market, a limited number of established business relationships in the area and a relative unfamiliarity with local governmental and permitting procedures
§	we may be unable to quickly and efficiently integrate new acquisitions, particularly acquisitions of portfolios of properties and operating entities, into our existing operations, and as a result, our results of operations and financial condition could be adversely affected

We may acquire properties subject to liabilities and without any recourse, or with only limited recourse, with respect to unknown liabilities. As a result, if a liability were asserted against us based upon ownership of those properties, we might have to pay substantial sums to settle it, which could adversely affect our cash flow.

Many of our Properties are concentrated in our primary markets, and we therefore may suffer economic harm as a result of adverse conditions in those markets.

Our Properties are located principally in specific geographic areas. Due to the concentration of our Properties in these areas, performance is dependent on economic conditions in these areas. These areas have experienced periods of economic decline.

We may not be able to access financial markets to obtain capital on a timely basis, or on acceptable terms.

In addition to the capital market constraints previously noted, our ability to access the public debt and equity markets depends on a variety of factors, including:

§	general economic conditions affecting these markets
§	our own financial structure and performance
§	the market’s opinion of REITs in general
§	the market’s opinion of REITs that own properties similar to ours

We may suffer adverse effects as a result of the terms of and covenants relating to our indebtedness.

Required payments on our indebtedness generally are not reduced if the economic performance of our portfolio of Properties declines. If the economic performance of our Properties declines, net income, cash flow from operations and cash available for distribution to shareholders will be reduced. If payments on debt cannot be made, we could sustain a loss, or in the case of mortgages, suffer foreclosures by mortgagees or suffer judgments. Further, some obligations, including our $600 million credit facility and $2.1 billion in unsecured notes issued in past public offerings, contain cross-default and/or cross-acceleration provisions, as does $10.9 million in outstanding mortgage indebtedness at December 31, 2008, which means that a default on one obligation may constitute a default on other obligations.

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Our credit facility and unsecured debt securities contain customary restrictions, requirements and other limitations on our ability to incur indebtedness, including total debt to asset ratios, secured debt to total asset ratios, debt service coverage ratios and minimum ratios of unencumbered assets to unsecured debt which we must maintain. Our continued ability to borrow under our $600 million credit facility is subject to compliance with our financial and other covenants. In addition, our failure to comply with such covenants could cause a default under this credit facility, and we may then be required to repay such debt with capital from other sources. Under those circumstances, other sources of capital may not be available to us, or be available only on unattractive terms.

Our degree of leverage could limit our ability to obtain additional financing or affect the market price of our Common Shares.

Our degree of leverage could affect our ability to obtain additional financing for working capital, capital expenditures, acquisitions, development or other general corporate purposes. Our senior unsecured debt is currently rated investment grade by the three major rating agencies. However, there can be no assurance we will be able to maintain this rating, and in the event our senior debt is downgraded from its current rating, we would likely incur higher borrowing costs. Our degree of leverage could also make us more vulnerable to a downturn in business or the economy generally.

Further issuances of equity securities may be dilutive to our existing shareholders.

The interests of our existing shareholders could be diluted if we issue additional equity securities to finance future developments, acquisitions, or repay indebtedness. We are currently engaged in an ongoing offering of up to $150 million of our equity securities. Additionally, our Board of Trustees can authorize the issuance of additional securities without shareholder approval. Our ability to execute our business strategy depends on our access to an appropriate blend of debt financing, including unsecured lines of credit and other forms of secured and unsecured debt, and equity financing, including issuances of common and preferred equity.

An increase in interest rates would increase our interest costs on variable rate debt and could adversely impact our ability to refinance existing debt.

We currently have, and may incur more, indebtedness that bears interest at variable rates. Accordingly, if interest rates increase, so will our interest costs, which would adversely affect our cash flow and our ability to pay principal and interest on our debt and our ability to make distributions to our shareholders. Further, rising interest rates could limit our ability to refinance existing debt when it matures.

Property ownership through joint ventures will limit our ability to act exclusively in our interests and may require us to depend on the financial performance of our co-venturers.

From time to time we invest in joint ventures in which we do not hold a controlling interest. These investments involve risks that do not exist with properties in which we own a controlling interest, including the possibility that our partners may, at any time, have business, economic or other objectives that are inconsistent with our objectives. In instances where we lack a controlling interest, our partners may be in a position to require action that is contrary to our objectives. While we seek to negotiate the terms of these joint ventures in a way that secures our ability to act in our best interests, there can be no assurance that those terms will be sufficient to fully protect us against actions contrary to our interests. If the objectives of our co-ventures are inconsistent with ours, we may not in every case be able to act exclusively in our interests.

Additionally, our joint venture partners may experience financial difficulties that impair their ability to meet their obligations to the joint venture, such as with respect to providing additional capital, if required. If such a circumstance presented itself we may be required to perform on their behalf, if possible, or suffer a loss of all or a portion of our investment in the joint venture.

Risks Related to the Real Estate Industry

Real estate investments are illiquid, and we may not be able to sell our Properties if and when we determine it is appropriate to do so.

Real estate generally cannot be sold quickly. We may not be able to dispose of our Properties promptly in response to economic or other conditions. In addition, provisions of the Internal Revenue Code of 1986, as amended (the

12

“Code”) limit a REIT’s ability to sell properties in some situations when it may be economically advantageous to do so, thereby adversely affecting returns to shareholders and adversely impacting our ability to meet our obligations to the holders of other securities.

We may experience economic harm if any damage to our Properties is not covered by insurance.

We believe all of our Properties are adequately insured. However, we cannot guarantee that the limits of our current policies will be sufficient in the event of a catastrophe to our Properties. Our existing property and liability policies expire during 2009. We cannot guarantee that we will be able to renew or duplicate our current coverages in adequate amounts or at reasonable prices.

We may suffer losses that are not covered under our comprehensive liability, fire, extended coverage and rental loss insurance policies. For example, we may not be insured for losses resulting from acts of war, certain acts of terrorism, or from environmental liabilities. If an uninsured loss or a loss in excess of insured limits should occur, we would nevertheless remain liable for the loss which could adversely affect cash flow from operations.

Potential liability for environmental contamination could result in substantial costs.

Under federal, state and local environmental laws, ordinances and regulations, we may be required to investigate and clean up the effects of releases of hazardous or toxic substances or petroleum products at our Properties simply because of our current or past ownership or operation of the real estate. If unidentified environmental problems arise, we may have to make substantial payments which could adversely affect our cash flow and our ability to make distributions to our shareholders because:

§	as owner or operator, we may have to pay for property damage and for investigation and clean-up costs incurred in connection with the contamination
§	the law typically imposes clean-up responsibility and liability regardless of whether the owner or operator knew of or caused the contamination
§	even if more than one person may be responsible for the contamination, each person who shares legal liability under the environmental laws may be held responsible for all of the clean-up costs
§	governmental entities and third parties may sue the owner or operator of a contaminated site for damages and costs

These costs could be substantial. The presence of hazardous or toxic substances or petroleum products or the failure to properly remediate contamination may materially and adversely affect our ability to borrow against, sell or rent an affected property. In addition, applicable environmental laws create liens on contaminated sites in favor of the government for damages and costs it incurs in connection with a contamination. Changes in laws increasing the potential liability for environmental conditions existing at our Properties may result in significant unanticipated expenditures.

It is our policy to retain independent environmental consultants to conduct Phase I environmental site assessments and asbestos surveys with respect to our acquisition of properties. These assessments generally include a visual inspection of the properties and the surrounding areas, an examination of current and historical uses of the properties and the surrounding areas and a review of relevant state, federal and historical documents, but do not involve invasive techniques such as soil and ground water sampling. Where appropriate, on a property-by-property basis, our practice is to have these consultants conduct additional testing, including sampling for asbestos, for lead in drinking water, for soil contamination where underground storage tanks are or were located or where other past site usages create a potential environmental problem, and for contamination in groundwater. Even though these environmental assessments are conducted, there is still the risk that:

§	the environmental assessments and updates will not identify all potential environmental liabilities
§	a prior owner created a material environmental condition that is not known to us or the independent consultants preparing the assessments
§	new environmental liabilities have developed since the environmental assessments were conducted
§	future uses or conditions such as changes in applicable environmental laws and regulations could result in environmental liability for us

While we test indoor air quality on a regular basis and have an ongoing maintenance program in place to address this aspect of property operations, inquiries about indoor air quality may necessitate special investigation and, depending on the results, remediation. Indoor air quality issues can stem from inadequate ventilation, chemical contaminants

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from indoor or outdoor sources, pollen, viruses and bacteria. Indoor exposure to chemical or biological contaminants above certain levels can be alleged to be connected to allergic reactions or other health effects and symptoms in susceptible individuals. If these conditions were to occur at one of our Properties, we may need to undertake a targeted remediation program, including without limitation, steps to increase indoor ventilation rates and eliminate sources of contaminants. Such remediation programs could be costly, necessitate the temporary relocation of some or all of the Property’s tenants or require rehabilitation of the affected Property.

Our Properties may contain or develop harmful mold, which could lead to liability for adverse health effects and costs of remediating the problem.

When excessive moisture accumulates in buildings or on building materials, mold growth may occur, particularly if the moisture problem remains undiscovered or is not addressed over a period of time. Some molds may produce airborne toxins or irritants. Concern about indoor exposure to mold has been increasing as exposure to mold may cause a variety of adverse health effects and symptoms, including allergic or other reactions. As a result, the presence of significant mold at any of our Properties could require us to undertake a costly remediation program to contain or remove the mold from the affected Property. In addition, the presence of significant mold could expose us to liability from our tenants, employees of our tenants and others if property damage or health concerns arise.

Compliance with the Americans with Disabilities Act and fire, safety and other regulations may require us to make expenditures that adversely impact our operating results.

All of our Properties are required to comply with the Americans with Disabilities Act (“ADA”). The ADA generally requires that buildings be made accessible to people with disabilities. Compliance with the ADA requirements could require removal of access barriers, and non-compliance could result in imposition of fines by the United States government or an award of damages to private litigants, or both. Expenditures related to complying with the provisions of the ADA could adversely affect our results of operations and financial condition and our ability to make distributions to shareholders. In addition, we are required to operate our Properties in compliance with fire and safety regulations, building codes and other land use regulations, as they may be adopted by governmental agencies and bodies and become applicable to our Properties. We may be required to make substantial capital expenditures to comply with those requirements and these expenditures could have a material adverse effect on our operating results and financial condition, as well as our ability to make distributions to shareholders.

Terrorist attacks and other acts of violence or war may adversely impact our operating results and may affect markets on which our securities are traded.

Terrorist attacks against our Properties, or against the United States or United States interests generally, may negatively affect our operations and investments in our securities. Attacks or armed conflicts could have a direct adverse impact on our Properties or operations through damage, destruction, loss or increased security costs. Any terrorism insurance that we obtain may be insufficient to cover the loss for damages to our Properties as a result of terrorist attacks.

Furthermore, any terrorist attacks or armed conflicts could result in increased volatility in or damage to the United States and worldwide financial markets and economy. Adverse economic conditions could affect the ability of our tenants to pay rent, which could have an adverse impact on our operating results.

Risks Related to Our Organization and Structure

We have elected REIT status under the federal tax laws and could suffer adverse consequences if we fail to qualify as a REIT.

We have elected REIT status under federal tax laws and have taken the steps known to us to perfect that status, but we cannot be certain that we qualify or that we will remain qualified. Qualification as a REIT involves the application of highly technical and complex provisions of the Code, as to which there are only limited judicial or administrative interpretations. The complexity of these provisions and of the related income tax regulations is greater in the case of a REIT that holds its assets in partnership form, as we do. Moreover, no assurance can be given that new tax laws will not significantly affect our qualification as a REIT or the federal income tax consequences of such qualification. New laws could be applied retroactively, which means that past operations could be found to be in violation, which would have a negative effect on the business.

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If we fail to qualify as a REIT in any taxable year, the distributions to shareholders would not be deductible when computing taxable income. If this happened, we would be subject to federal income tax on our taxable income at regular corporate rates. Also, we could be prevented from qualifying as a REIT for the four years following the year in which we were disqualified. Further, if we requalified as a REIT after failing to qualify, we might have to pay the full corporate-level tax on any unrealized gain in our assets during the period we were not qualified as a REIT. We would then have to distribute to our shareholders the earnings we accumulated while we were not qualified as a REIT. These additional taxes would reduce our funds available for distribution to our shareholders. In addition, while we were disqualified as a REIT, we would not be required by the Code to make distributions to our shareholders. A failure by the Company to qualify as a REIT and the resulting requirement to pay taxes and interest (and perhaps penalties) would cause us to default under various agreements to which we are a party, including under our credit facility, and would have a material adverse effect on our business, prospects, results of operations, earnings, financial condition and our ability to make distributions to shareholders.

Future economic, market, legal, tax or other considerations may lead our Board of Trustees to authorize the revocation of our election to qualify as a REIT. A revocation of our REIT status would require the consent of the holders of a majority of the voting interests of all of our outstanding Common Shares.

Risks associated with potential borrowings necessary to make distributions to qualify as a REIT; distributions can be made in Common Shares.

We intend to make distributions to shareholders to comply with the distribution provisions of the Code necessary to maintain qualification as a REIT and to avoid income taxes and the non-deductible excise tax. Under certain circumstances, we may be required to borrow funds to meet the distribution requirements necessary to achieve the tax benefits associated with qualifying as a REIT. In such circumstances, we might need to borrow funds to avoid adverse tax consequences, even if our management believes that the prevailing market conditions are not generally favorable for such borrowings or that such borrowings would not be advisable in the absence of such tax considerations.

For distributions with respect to a taxable year ending on or before December 31, 2009, Company stock may be used to meet these distribution requirements, subject to the requirements of Internal Revenue Service Revenue Procedure 2009-15, 200-4 I.R.B. 356. Under this Revenue Procedure, we are permitted to make taxable distributions of our stock (in lieu of cash) if (x) any such distribution is declared with respect to a taxable year ending on or before December 31, 2009, and (y) each of our stockholders is permitted to elect to receive its entire entitlement under such declaration in either cash or shares of equivalent value subject to a limitation in the amount of cash to be distributed in the aggregate; provided that (i) the amount of cash that we set aside for distribution is not less than 10% of aggregate distribution so declared, and (ii) if too many of our stockholders elect to receive cash, a pro rata amount of cash will be distributed to each such stockholder electing to receive cash, but in no event will any such stockholder receive less than its entire entitlement under such declaration.

Certain officers of the Trust may not have the same interests as shareholders as to certain tax laws.

Certain officers of the Trust own Common Units. These units may be exchanged for our Common Shares. The officers who own those units and have not yet exchanged them for our Common Shares may suffer different and more adverse tax consequences than holders of our Common Shares suffer in certain situations:

§	when certain of our Properties are sold
§	when debt on those Properties is refinanced
§	if we are involved in a tender offer or merger

Because these officers own units and face different consequences than shareholders do, the Trust and those officers may have different objectives as to these transactions than shareholders do.

Certain aspects of our organization could have the effect of restricting or preventing a change of control of our Company, which could have an adverse effect on the price of our shares.

Our charter contains an ownership limit on shares. To qualify as a REIT, five or fewer individuals cannot own, directly or indirectly, more than 50% in value of the outstanding shares of beneficial interest. To this end, our Declaration of Trust, among other things, generally prohibits any holder of the Trust’s shares from owning more than 5% of the Trust’s outstanding shares of beneficial interest, unless that holder gets the consent from our Board of

15

Trustees. This limitation could prevent the acquisition of control of the Company by a third party without the consent from our Board of Trustees.

We have a staggered board and certain restrictive nominating procedures. Our Board of Trustees has three classes of trustees. The term of office of one class expires each year. Trustees for each class are elected for three-year terms as that class’ term expires. The terms of the Class III, Class I, and Class II trustees expire in 2009, 2010, and 2011, respectively. Any nominee for trustee must be selected under the nominating provisions contained in our Declaration of Trust and By-Laws. The staggered terms for trustees and the nominating procedures may affect shareholders’ ability to take control of the Company, even if a change in control were in the shareholders’ interest.

We can issue preferred shares. Our Declaration of Trust authorizes our Board of Trustees to establish the preferences and rights of any shares issued. The issuance of preferred shares could have the effect of delaying, making more difficult or preventing a change of control of the Company, even if a change in control were in the shareholder’s interest.

There are limitations on acquisition of and changes in control pursuant to, and fiduciary protections of The Board under Maryland law. The Maryland General Corporation Law (“MGCL”) contains provisions which are applicable to the Trust as if the Trust were a corporation. Among these provisions is a section, referred to as the “control share acquisition statute,” which eliminates the voting rights of shares acquired in quantities so as to constitute “control shares,” as defined under the MGCL. The MGCL also contains provisions applicable to us that are referred to as the “business combination statute,” which would generally limit business combinations between the Company and any 10% owners of the Trust’s shares or any affiliate thereof. Further, Maryland law provides broad discretion to the Board with respect to its fiduciary duties in considering a change in control of our Company, including that the Board is subject to no greater level of scrutiny in considering a change in control transaction than with respect to any other act by the Board. Finally, the “unsolicited takeovers” provisions of the MGCL permit the Board, without shareholder approval and regardless of what is currently provided in our Declaration of Trust or By-Laws, to implement takeover defenses that our Company does not yet have, including permitting only the Board to fix the size of the Board and permitting only the Board to fill a vacancy on the Board. All of these provisions may have the effect of inhibiting a third party from making an acquisition proposal for our Company or of delaying, deferring or preventing a change in control of the Company under circumstances that otherwise could provide the holders of Common Shares with the opportunity to realize a premium over the then current market price.

Various factors out of our control could hurt the market value of our publicly traded securities.

The value of our publicly traded securities depends on various market conditions, which may change from time to time. In addition to general economic and market conditions and our particular financial condition and performance, the value of our publicly traded securities could be affected by, among other things, the extent of institutional investor interest in us and the market’s opinion of REITs in general and, in particular, REITs that own and operate properties similar to ours.

The market value of the equity securities of a REIT may be based primarily upon the market’s perception of the REITs growth potential and its current and future cash distributions, and may be secondarily based upon the real estate market value of the underlying assets. The failure to meet the market’s expectations with regard to future earnings and cash distributions likely would adversely affect the market price of publicly traded securities. On November 17, 2008, we announced that our annual dividend rate was being reduced from $2.50 to $1.90. Our payment of future dividends will be at the discretion of our Board of Trustees and will depend on numerous factors including our cash flow, financial condition and capital requirements, annual distribution requirements under the REIT provisions of the Code, the general economic environment and such other factors as our Board of Trustees deems relevant, and we cannot assure you that our annual dividend rate will be maintained at its current level.

Rising market interest rates could make an investment in publicly traded securities less attractive. If market interest rates increase, purchasers of publicly traded securities may demand a higher annual yield on the price they pay for their securities. This could adversely affect the market price of publicly traded securities.

We no longer have a shareholder rights plan but are not precluded from adopting one.

Our shareholder rights plan expired in accordance with its terms on December 31, 2007. While we did not extend or renew the plan, we are not prohibited from adopting, without shareholder approval, a shareholder rights plan that may discourage any potential acquirer from acquiring more than a specific percentage of our outstanding Common Shares

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since, upon this type of acquisition without approval of our Board of Trustees, all other common shareholders would have the right to purchase a specified amount of Common Shares at a substantial discount from market price.

Transactions by the Trust or the Operating Partnership could adversely affect debt holders.

Except with respect to several covenants limiting the incurrence of indebtedness and a covenant requiring the Operating Partnership to maintain a certain unencumbered total asset value, our indentures do not contain any additional provisions that would protect holders of the Operating Partnership’s debt securities in the event of (i) a highly leveraged transaction involving the Operating Partnership, (ii) a change of control or (iii) certain reorganizations, restructurings, mergers or similar transactions involving the Operating Partnership or the Trust.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

The Wholly Owned Properties in Operation, as of December 31, 2008, consisted of 357 industrial and 297 office properties. Single tenants occupy 200 Wholly Owned Properties in Operation. These tenants generally require a reduced level of service in connection with the operation or maintenance of these properties. The remaining 454 of the Company’s Wholly Owned Properties in Operation are multi-tenant properties for which the Company renders a range of building, operating and maintenance services.

As of December 31, 2008, the industrial Wholly Owned Properties in Operation were 90.1% leased. The average building size for the industrial Wholly Owned Properties in Operation was approximately 118,000 square feet. As of December 31, 2008, the office Wholly Owned Properties in Operation were 93.1% leased. The average building size for the office Wholly Owned Properties in Operation was approximately 73,000 square feet.

The JV Properties in Operation, as of December 31, 2008, consisted of 46 industrial and 49 office properties. Single tenants occupy 43 JV Properties in Operation. These tenants generally require a reduced level of service in connection with the operation or maintenance of these properties. The remaining 52 of the Company’s JV Properties in Operation are multi-tenant properties for which the Company renders a range of building, operating and maintenance services.

As of December 31, 2008, the industrial JV Properties in Operation were 93.5% leased. The average building size for the industrial JV Properties in Operation was approximately 185,000 square feet. As of December 31, 2008, the office JV Properties in Operation were 89.6% leased. The average building size for the office JV Properties in Operation was approximately 93,000 square feet.

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A complete listing of the Wholly Owned Properties in Operation appears as Schedule III to the financial statements of the Company included in this report. The table below sets forth certain information on the Company’s Properties in Operation as of December 31, 2008 (in thousands, except percentages).

	Type		Net Rent (1)		Square Feet		% Leased
Northeast	Industrial-Distribution		$	54,535		14,705		87.9	%
		-Flex		33,442		3,890		93.2	%
	Office			123,948		9,059		92.9	%
	Total			211,925		27,654		90.3	%
Midwest	Industrial-Distribution			5,320		1,224		100.0	%
		-Flex		18,072		2,463		83.5	%
	Office			28,320		2,468		96.7	%
	Total			51,712		6,155		92.1	%
Mid-Atlantic	Industrial-Distribution			33,656		8,843		90.5	%
		-Flex		9,619		1,188		89.8	%
	Office			59,732		4,603		93.0	%
	Total			103,007		14,634		91.2	%
South	Industrial-Distribution			27,046		5,934		93.1	%
		-Flex		30,317		3,834		90.2	%
	Office			59,658		4,620		90.5	%
	Total			117,021		14,388		91.5	%
Philadelphia	Industrial-Distribution			—		—		—
		-Flex		1,745		101		100.0	%
	Office			11,130		733		99.2	%
	Total			12,875		834		99.3	%
United Kingdom	Industrial-Distribution			—		—		—
		-Flex		1,148		44		100.0	%
	Office			2,168		90		92.0	%
	Total			3,316		134		94.6	%
TOTAL	Industrial-Distribution			120,557		30,706		90.1	%
		-Flex		94,343		11,520		89.9	%
	Office			284,956		21,573		93.1	%
	Total		$	499,856		63,799		91.1	%
Joint Ventures (2)	Industrial-Distribution			32,632		8,317		93.7	%
		-Flex		3,718		171		86.7	%
	Office			98,591		4,581		89.6	%
			$	134,941		13,069		92.2	%

(1)	Net rent represents the contractual rent per square foot times the tenant’s square feet leased at December 31, 2008 for tenants in occupancy. Net rent does not include the tenant’s obligation to pay property operating expenses and real estate taxes.
(2)	Joint Ventures represent the 95 properties owned by unconsolidated joint ventures in which the Company has an interest.

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The expiring square feet and annual rent by year for the Properties in Operation as of December 31, 2008 are as follows (in thousands):

Total Properties in Operation

Wholly Owned Properties in Operation:

	Industrial-
	Distribution				Industrial-Flex				Office				Total
	Square		Annual		Square		Annual		Square		Annual		Square		Annual
Year	Feet		Rent		Feet		Rent		Feet		Rent		Feet		Rent
2009		3,020	$	13,073		1,499	$	12,955		2,208	$	30,734		6,727	$	56,762
2010		3,532		16,804		1,715		16,148		2,961		42,275		8,208		75,227
2011		2,988		13,667		1,345		13,868		2,356		36,304		6,689		63,839
2012		4,698		23,275		1,530		15,124		2,320		40,360		8,548		78,759
2013		2,076		10,421		1,328		13,950		2,558		42,709		5,962		67,080
2014		2,074		11,169		625		7,263		2,283		35,506		4,982		53,938
Thereafter		9,289		52,225		2,311		27,592		5,392		97,758		16,992		177,575
Total		27,677	$	140,634		10,353	$	106,900		20,078	$	325,646		58,108	$	573,180

Joint Venture Properties in Operation:

	Industrial-
	Distribution				Industrial-Flex				Office				Total
	Square		Annual		Square		Annual		Square		Annual		Square		Annual
Year	Feet		Rent		Feet		Rent		Feet		Rent		Feet		Rent
2009		981	$	3,817		18	$	439		358	$	7,297		1,357	$	11,553
2010		1,367		5,451		5		135		435		9,407		1,807		14,993
2011		938		3,950		11		275		452		10,748		1,401		14,973
2012		329		1,598		90		2,423		150		3,420		569		7,441
2013		534		2,316		—		—		248		5,851		782		8,167
2014		1,078		4,981		2		64		330		9,195		1,410		14,240
Thereafter		2,562		13,665		—		—		2,155		72,098		4,717		85,763
Total		7,789	$	35,778		126	$	3,336		4,128	$	118,016		12,043	$	157,130

Properties in Operation:

	Industrial-
	Distribution				Industrial-Flex				Office				Total
	Square		Annual		Square		Annual		Square		Annual		Square		Annual
Year	Feet		Rent		Feet		Rent		Feet		Rent		Feet		Rent
2009		4,001	$	16,890		1,517	$	13,394		2,566	$	38,031		8,084	$	68,315
2010		4,899		22,255		1,720		16,283		3,396		51,682		10,015		90,220
2011		3,926		17,617		1,356		14,143		2,808		47,052		8,090		78,812
2012		5,027		24,873		1,620		17,547		2,470		43,780		9,117		86,200
2013		2,610		12,737		1,328		13,950		2,806		48,560		6,744		75,247
2014		3,152		16,150		627		7,327		2,613		44,701		6,392		68,178
Thereafter		11,851		65,890		2,311		27,592		7,547		169,856		21,709		263,338
Total		35,466	$	176,412		10,479	$	110,236		24,206	$	443,662		70,151	$	730,310

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The table below highlights, for the Properties in Operation, the Company’s top ten office tenants and top ten industrial tenants as of December 31, 2008. The table includes, for the tenants in the JV Properties in Operation, the Company’s ownership percentage of the respective joint venture.

	Percentage				Percentage
Top 10 Office Tenants	of Net Rent			Top 10 Industrial Tenants	of Net Rent
The Vanguard Group, Inc.		4.1	%	Home Depot U.S.A., Inc.		1.2	%
GlaxoSmithKline		2.1	%	Kellogg USA, Inc.		1.1	%
General Motors Acceptance Corporation		1.6	%	Wakefern Food Corp.		1.0	%
PHH Corporation		1.3	%	United Parcel Services, Inc.		0.8	%
Comcast Corporation		1.2	%	The Dial Corporation		0.6	%
Sanofi-Aventis U.S., Inc.		1.1	%	Uline, Inc.		0.5	%
PNC Bank, National Association		1.0	%	Broder Bros, Inc.		0.5	%
WellCare Health Plans, Inc.		1.0	%	Foxconn Corporation		0.5	%
United States of America		0.9	%	Moore Wallace North America, Inc.		0.4	%
United Healthcare Services, Inc.		0.8	%	Nexus Distribution Corporation		0.4	%
		15.1	%			7.0	%

ITEM 3. LEGAL PROCEEDINGS

The Company has been substituted for Republic Property Trust, a Maryland real estate investment trust, and Republic Property Limited Partnership, a Delaware limited partnership, (together, “Republic”) as a party to certain litigation as a result of the Company’s acquisition of Republic on October 4, 2007. The litigation is summarized below. The litigation arises out of disputes between Republic and certain parties, two of whom were members of Republic’s Board of Trustees and “founders” of Republic. The disputes include claims arising from the termination of an officer of Republic, the termination of a development arrangement in West Palm Beach, Florida and an attempt by Republic to acquire a certain office property from an entity controlled by the aforementioned related parties pursuant to an option agreement entered into at the time of Republic’s formation.

On November 17, 2006, Republic disclosed in a Form 8-K that Steven A. Grigg, its President and Chief Development Officer, had notified it that he was terminating his employment, purportedly for “good reason,” as such term is defined in his employment agreement, dated December 20, 2005. Mr. Grigg also asserted that, as a result of such termination, he was entitled to the severance payments provided for under the terms of the employment agreement. The cash portion of such severance payments could be valued at up to approximately $1.8 million. The Company disagrees with Mr. Grigg that there is a basis for termination by Mr. Grigg for good reason; therefore, we believe that Mr. Grigg terminated his employment without good reason as of November 13, 2006, the date of his termination letter. Accordingly, we believe that no severance payments are due and we have not remitted any such payments to Mr. Grigg under the terms of his employment agreement.

On December 22, 2006, Mr. Grigg filed a lawsuit against Republic in the Superior Court of the District of Columbia. Mr. Grigg alleges, among other things, that (i) Republic breached his employment agreement, (ii) Republic breached its duties of good faith and fair dealing and (iii) the Noncompetition Agreement dated December 20, 2005 between Mr. Grigg and Republic is unenforceable and void. Mr. Grigg seeks, among other remedies, (i) the severance payment allegedly due under the employment agreement, (ii) other damages in an amount to be finally determined at trial and (iii) the voiding of the Noncompetition Agreement. The Company believes that Mr. Grigg’s lawsuit is without merit, generally denies the allegations in the complaint and denies that Mr. Grigg is entitled to any of the relief sought in his complaint. Republic originally asserted various counterclaims against Mr. Grigg, including claims for common law fraud, state securities fraud, breach of his employment agreement, breach of fiduciary duties and unjust enrichment. Republic subsequently voluntarily dismissed without prejudice its common law fraud, state securities fraud and unjust enrichment claims in order to pursue those claims in the litigation described below pending in the United States District Court for the District of Columbia. The Company’s counterclaims against Mr. Grigg for breach of his employment agreement and breach of his fiduciary duties remain pending in the District of Columbia Superior Court litigation. On March 30, 2007, the Court denied, in its entirety, Mr. Grigg’s motion to dismiss these counterclaims. The Company seeks damages and other appropriate relief on these counterclaims.

On March 6, 2007, Mr. Richard Kramer, Republic’s former Non-executive Chairman of the Board, filed a lawsuit against Republic in the United States District Court for the District of Maryland Southern Division, in which he sought advancement for legal fees incurred by him purportedly in connection with an independent counsel’s investigation with respect to certain matters involving Republic’s course of dealing in a West Palm Beach development project, as well as those fees incurred in filing and prosecuting this lawsuit. On May 3, 2007, Mr. Kramer voluntarily dismissed this case, and filed a nearly identical lawsuit against Republic in the Circuit Court of Baltimore County, Maryland. We believe that Mr. Kramer’s lawsuit is without merit and filed a motion to dismiss or, in the alternative, motion for summary judgment, seeking the dismissal of Mr. Kramer’s lawsuit. Mr. Kramer filed

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a motion for summary judgment against the Company. On November 2, 2007 the Court denied Mr. Kramer’s motion for summary judgment and granted the Company’s motion to dismiss. Mr. Kramer has appealed the Court’s judgment.

On March 28, 2007, Republic filed a lawsuit against Messrs. Kramer and Grigg and Republic Properties Corporation in the United States District Court of the District of Columbia. This lawsuit asserts, among other things, claims against (i) all three defendants for (a) federal and state securities fraud and (b) common law fraud; (ii) Messrs. Kramer and Grigg for (a) federal and state control person liability and (b) unjust enrichment; and (iii) Republic Properties Corporation for (a) breach of contract and (b) indemnification. The Company seeks, among other remedies, (i) damages in an amount not less than $1.2 million, the approximate value (at the time of issuance) of the partnership units issued by Republic Property Limited Partnership to Republic Properties Corporation in connection with the West Palm Beach City Center Development Contribution Agreement, (ii) additional damages incurred by us as a result of the termination of the West Palm Beach Professional Services Agreement, (iii) recovery of the costs, including attorneys fees, associated with a previously-disclosed independent investigation, (iv) reimbursement for Republic’s expenses in this litigation, including attorneys’ fees, and (v) other damages, including punitive damages, in an amount to be finally determined at trial. On April 27, 2007, Republic filed an Amended Complaint in the District of Columbia District Court action, adding to the claims set forth immediately above a claim for declaratory judgment that Mr. Kramer was not entitled to advancement or reimbursement of any of the fees sought in his Maryland litigation. Republic Properties Corporation, Messrs. Kramer and Grigg filed motions to dismiss this lawsuit. On March 31, 2008, the Court granted the motion to dismiss. We filed a motion for reconsideration of the grant of the motion to dismiss. On August 13, 2008, the Court denied the motion for reconsideration. We have appealed the Court’s decision.

On May 21, 2007, Republic proffered a lease, or the Lease, to 25 Massachusetts Avenue Property LLC, or 25 Mass, for certain space in Republic Square I, an office building in Washington, D.C., or the Option Property. Two of Republic’s founders and Trustees, Richard L. Kramer and Steven A. Grigg, currently control 25 Mass and Mark R. Keller, Republic’s former Chief Executive Officer, holds an ownership interest in 25 Mass. Based on information provided by 25 Mass, immediately prior to the proffer of the Lease, approximately 50% of the Option Property’s net rentable area was under lease and approximately 37% of the Option Property’s net rentable area was rent paying space. Had 25 Mass accepted the Lease, more than 85% of the space in the Option Property would have been rent paying space. The base rents and other material terms of the Lease proffer were based on 25 Mass’s lease up projections for the Property and the Lease was on 25 Mass’s form lease agreement.

On May 22, 2007, 25 Mass rejected the proffer of the Lease, asserting, among other things, that it was “not a bona fide business proposal for Republic’s own occupancy and leasing of space”. On May 29, 2007, Republic (i) re-tendered the Lease to 25 Mass for certain space at the Option Property and (ii) exercised its exclusive option to purchase the fee interest in the Option Property pursuant to the Option Agreement among 25 Mass, 660 North Capitol Street Property LLC and Republic dated as of November 28, 2005, or the Option Agreement. On May 30, 2007, 25 Mass rejected the Lease and claimed that “there has been no effective exercise of the Option.” The Company believes that the Lease was properly tendered for an appropriate purpose and, accordingly, the Company re-proffered the Lease to 25 Mass. 25 Mass rejected the Lease proffer and disputed whether the Lease entitled Republic to purchase the Property, pursuant to its exercise of the option, at the Purchase Price (as defined in the Option Agreement).

In response to 25 Mass’s rejection, on June 15, 2007, Republic filed a lawsuit against 25 Mass in the Court of Chancery in the State of Delaware. This lawsuit asserts, among other things, that (i) by refusing to accept Republic’s option exercise 25 Mass has breached the Option Agreement and (ii) by deciding not to refinance a construction loan on the Property and rejecting the Lease, 25 Mass has breached the covenant of good faith and fair dealing implied in every contract governed by the laws of the District of Columbia. Republic sought, among other remedies, to obtain (I) an injunction against 25 Mass’s sale of the Option Property to any party other than Republic, (II) a declaration that the Lease and option exercise are effective and (III) an order that 25 Mass specifically perform its obligation to sell the Option Property to Republic pursuant to the Option Agreement. Also on June 15, 2007, Republic filed a Notice of Pendency of Action (Lis Pendens) in the Office of the Recorder of Deeds in the District of Columbia, in order to record Republic’s interest in the Option Property as reflected in the Delaware Chancery Court action. On April 7, 2008, the Court of Chancery issued an opinion concluding that neither party was entitled to relief and ordering that the Lis Pendens be lifted. On April 15, 2008, 25 Mass filed a notice of appeal from dismissal of its counterclaims. The parties fully briefed 25 Mass’ appeal to the Delaware Supreme Court, to which all appeals are made. Oral argument in this matter was made before the Delaware Supreme Court on November 12, 2008. On November 25, 2008, the Delaware Supreme Court remanded the matter to the Court of Chancery in order for the Court of Chancery to consider 25 Mass’ claimed breach of the Option Agreement based on (i) liability for breach of the implied duty of

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good faith and fair dealing; and (ii) liability for breach of the “further assurances” clause of the option agreement. On January 22, 2009, the Court of Chancery issued a Memorandum Opinion adhering to its original determination that 25 Mass’ counterclaim should be dismissed. On January 29, 2009, the Supreme Court of the State of Delaware set forth a schedule for supplemental memoranda to be filed by the parties. The schedule contemplates that the matter will be submitted to the Court for decision on briefs as of April 8, 2009.

On December 12, 2008, 25 Mass filed a complaint in the Superior Court for the District of Columbia, alleging that 25 Mass had entered a purchase and sale agreement with a third party for the sale of Republic Square I, and that Republic’s lawsuit and its Lis Pendens, described above, prevented a closing by which Republic Square I could be sold under the terms of that purchase and sale agreement. The December 12, 2008 lawsuit alleges that by so doing, Republic committed tortious interference with contract, tortious interference with prospective contractual relations, malicious prosecution, abuse of process and a violation of the Washington D.C. Lis Pendens statute. The filed complaint seeks “no less than $85 million” in compensatory damages, and “no less than $85 million” in punitive damages, and attorneys’ fees for an improperly filed Lis Pendens under Washington D.C. Code § 42-1207(d). We believe that these claims are without merit and intend to defend vigorously against this litigation.

While management currently believes that resolving these matters will not have a material adverse impact on our financial position, our results of operations or our cash flows, the litigation noted above is subject to inherent uncertainties and management’s view of these matters may change in the future. Were an unfavorable final outcome to occur, there exists the possibility of a material adverse impact on our financial position and the results of operations for the period in which the effect becomes capable of being reasonably estimated.

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

No matters were submitted to a vote of security holders during the fourth quarter of the year ended December 31, 2008.

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PART II

ITEM 5. MARKET FOR THE REGISTRANTS’ COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND RELATED ISSUER PURCHASES OF EQUITY SECURITIES

The Common Shares are traded on the New York Stock Exchange under the symbol “LRY.” There is no established public trading market for the Common Units. The following table sets forth, for the calendar quarters indicated, the high and low closing prices of the Common Shares on the New York Stock Exchange, and the dividends declared per Common Share for such calendar quarter.

					Dividends
					Declared Per
	High		Low		Common Share
2008
Fourth Quarter	$	37.27	$	12.93	$	0.475
Third Quarter		40.89		31.43		0.625
Second Quarter		37.11		32.60		0.625
First Quarter		33.24		25.85		0.625
2007
Fourth Quarter	$	43.78	$	28.16	$	0.625
Third Quarter		45.48		34.27		0.625
Second Quarter		50.24		42.63		0.62
First Quarter		53.91		47.89		0.62

As of February 23, 2009, the Common Shares were held by 1,167 holders of record. Since its initial public offering in 1994, the Company has paid regular and uninterrupted quarterly dividends.

On November 17, 2008, the Company announced that its annual dividend rate was being reduced from $2.50 to $1.90. Although the Company currently anticipates that dividends at that or a comparable rate will continue to be paid in the future, the payment of future dividends by the Company will be at the discretion of the Board of Trustees and will depend on numerous factors including the Company’s cash flow, its financial condition, capital requirements, annual distribution requirements under the REIT provisions of the Code, the general economic environment and such other factors as the Board of Trustees deems relevant.

In November 2008, certain individuals acquired a total of 110,000 common shares of beneficial interest of Liberty Property Trust in exchange for the same number of units of limited partnership interest in Liberty Property Limited Partnership. Such persons acquired these units of limited partnership interest in connection with their contribution to the Operating Partnership of certain assets in 1998. The exchange of common shares of beneficial interest for the units of limited partnership interest is exempt from the registration requirement of the Securities Act of 1933, as amended, pursuant to Section 4 (2) thereunder.

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ITEM 6. SELECTED FINANCIAL DATA

The following tables set forth Selected Financial Data for Liberty Property Trust and Liberty Property Limited Partnership as of and for the years ended December 31, 2008, 2007, 2006, 2005 and 2004. The information set forth below should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the financial statements and notes thereto appearing elsewhere in this report. Certain amounts from prior years have been reclassified to conform to current-year presentation.

Liberty Property Trust

Operating Data	Year Ended December 31,
(In thousands, except per share data)	2008		2007		2006		2005		2004
Total operating revenue	$	748,520	$	686,831	$	607,562	$	577,569	$	529,606
Income from continuing operations	$	126,963	$	123,774	$	139,890	$	193,998	$	123,491
Net income	$	151,942	$	164,831	$	266,574	$	249,351	$	161,443
Basic:
Income from continuing operations	$	1.35	$	1.36	$	1.56	$	2.23	$	1.46
Income from discontinued operations	$	0.27	$	0.45	$	1.42	$	0.64	$	0.45
Income per common share	$	1.62	$	1.81	$	2.98	$	2.87	$	1.91
Diluted:
Income from continuing operations	$	1.35	$	1.35	$	1.55	$	2.19	$	1.44
Income from discontinued operations	$	0.27	$	0.45	$	1.40	$	0.63	$	0.44
Income per common share	$	1.62	$	1.80	$	2.95	$	2.82	$	1.88
Distributions paid per common share	$	2.500	$	2.485	$	2.465	$	2.445	$	2.425
Weighted average number of shares outstanding – basic (1)		93,624		91,185		89,313		86,986		84,534
Weighted average number of shares outstanding – diluted (2)		93,804		91,803		90,492		88,376		86,024

Balance Sheet Data	December 31,
(In thousands)	2008		2007		2006		2005		2004
Net real estate	$	4,546,418	$	4,906,738	$	4,318,530	$	3,936,516	$	3,641,569
Total assets		5,217,035		5,643,937		4,910,911		4,500,322		4,163,997
Total indebtedness		2,590,167		3,021,129		2,387,938		2,249,178		2,133,171
Shareholders’ equity		1,956,735		1,837,021		1,871,604		1,709,182		1,596,259

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

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Liberty Property Limited Partnership

Operating Data	Year Ended December 31,
(In thousands, except per share data)	2008		2007		2006		2005		2004
Total operating revenue	$	748,520	$	686,831	$	607,562	$	577,569	$	529,606
Income from continuing operations	$	153,542	$	147,271	$	159,698	$	214,381	$	140,647
Income available to common unitholders	$	158,611	$	172,387	$	278,359	$	259,364	$	168,398
Basic:
Income from continuing operations	$	1.35	$	1.36	$	1.56	$	2.23	$	1.46
Income from discontinued operations	$	0.27	$	0.45	$	1.42	$	0.64	$	0.45
Income per common unit	$	1.62	$	1.81	$	2.98	$	2.87	$	1.91
Diluted:
Income from continuing operations	$	1.35	$	1.35	$	1.55	$	2.19	$	1.44
Income from discontinued operations	$	0.27	$	0.45	$	1.40	$	0.63	$	0.44
Income per common unit	$	1.62	$	1.80	$	2.95	$	2.82	$	1.88
Distributions paid per common unit	$	2.500	$	2.485	$	2.465	$	2.445	$	2.425
Weighted average number of units outstanding – basic (1)		97,814		95,375		93,208		90,540		88,210
Weighted average number of units outstanding – diluted (2)		97,994		95,993		94,387		91,931		89,700

Balance Sheet Data	December 31,
(In thousands)	2008		2007		2006		2005		2004
Net real estate	$	4,546,418	$	4,906,738	$	4,318,530	$	3,936,516	$	3,641,569
Total assets		5,217,035		5,643,937		4,910,911		4,500,322		4,163,997
Total indebtedness		2,590,167		3,021,129		2,387,938		2,249,178		2,133,171
Owners’ equity		2,325,376		2,209,125		2,168,912		1,961,908		1,800,145

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

(1)	Basic weighted average number of shares includes vested Common Shares (Liberty Property Trust)/Common Units (Liberty Property Limited Partnership) outstanding during the year.
(2)	Diluted weighted average number of shares outstanding includes the vested and unvested Common Shares (Liberty Property Trust)/Common Units (Liberty Property Limited Partnership) outstanding during the year as well as the dilutive effect of outstanding options.
(3)	The National Association of Real Estate Investment Trusts (“NAREIT”) has issued a standard definition for Funds from operations (as defined below). The Securities and Exchange Commission has agreed to the disclosure of this non-GAAP financial measure on a per share basis in its Release No. 34-47226, Conditions for Use of Non-GAAP Financial Measures. The Company believes that the calculation of Funds from operations is helpful to investors and management as it is a measure of the Company’s operating performance that excludes depreciation and amortization and gains and losses from property dispositions. As a result, year over year comparison of Funds from operations reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses, and interest costs, providing perspective not immediately apparent from net income. In addition, management believes that Funds from operations provides useful information to the investment community about the Company’s financial performance when compared to other REITs since Funds from operations is generally recognized as the standard for reporting the operating performance of a REIT. Funds from operations available to common shareholders is defined by NAREIT as net income (computed in accordance with generally accepted accounting principles (“GAAP”)), excluding gains (or losses) from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Funds from operations available to common shareholders does not represent net income or cash flows from operations as defined by GAAP and does not necessarily indicate that cash flows will be sufficient to fund cash needs. It should not be considered as an alternative to net income as an indicator of the Company’s operating performance or to cash flows as a measure of liquidity. Funds from operations available to common shareholders also does not represent cash flows generated

25

from operating, investing or financing activities as defined by GAAP. A reconciliation of Funds from operations to net income may be found on page 39.

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

Overview

Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (“REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the “Operating Partnership” and, collectively with the Trust and their consolidated subsidiaries, the “Company”).

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

As of December 31, 2008, the Company owned and operated 357 industrial and 297 office properties (the “Wholly Owned Properties in Operation”) totaling 63.8 million square feet. In addition, as of December 31, 2008, the Company owned 17 properties under development, which when completed are expected to comprise 3.2 million square feet (the “Wholly Owned Properties under Development”) and 1,336 acres of developable land, substantially all of which is zoned for commercial use. Additionally, as of December 31, 2008, the Company had an ownership interest, through unconsolidated joint ventures, in 46 industrial and 49 office properties totaling 13.1 million square feet (the “JV Properties in Operation” and, together with the Wholly Owned Properties in Operation, the “Properties in Operation”), four properties under development, which when completed are expected to comprise 1.4 million square feet (the “JV Properties under Development” and, together with the Wholly Owned Properties under Development, the “Properties under Development”). The Company also has an ownership interest through unconsolidated joint ventures in 648 acres of developable land, substantially all of which is zoned for commercial use.

The Company focuses on creating value for shareholders and increasing profitability and cash flow. With respect to its Properties in Operation, the Company endeavors to maintain high occupancy levels while increasing rental rates and controlling costs. The Company pursues development opportunities that it believes will create value and yield acceptable returns. The Company also acquires properties that it believes will create long-term value, and disposes of properties that no longer fit within the Company’s strategic objectives or in situations where it can optimize cash proceeds. The Company’s operating results depend primarily upon income from rental operations and are substantially influenced by rental demand for the Properties in Operation.

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

Consistent with the dramatic slow down in the United States and world economy, rental demand for the Properties in Operation declined for the year ended December 31, 2008 as compared to the year ended December 31, 2007. Despite this trend, the Company successfully leased 20.4 million square feet during the year ended December 31, 2008 and attained occupancy of 91.1% for the Wholly Owned Properties in Operation and 92.2% for the JV Properties in Operation for a combined occupancy of 91.3% for the Properties in Operation as of that date. At December 31, 2007, occupancy for the Wholly Owned Properties in Operation was 92.7% and for the JV Properties in Operation was 94.0% for a combined occupancy for the Properties in Operation of 92.9%. The Company believes that straight line rents on renewal and replacement leases for 2009 will on average be 4% to 6% greater than rents on expiring leases. Furthermore, the Company believes that average occupancy for its Properties in Operation will not increase or decrease by more than 1% for 2009 compared to 2008.

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WHOLLY OWNED CAPITAL ACTIVITY

Acquisitions

During the year ended December 31, 2008, conditions for the acquisition of properties were unsettled because of adverse events in the credit markets. During the year ended December 31, 2008, the Company acquired one property representing 107,000 square feet for a Total Investment, as defined below, of $17.0 million. “Total Investment” for a property is defined as the property’s purchase price plus closing costs and management’s estimate, as determined at the time of acquisition, of the cost of necessary building improvements in the case of acquisitions, or land costs and land and building improvement costs in the case of development projects, and, where appropriate, other development costs and carrying costs. For 2009, the Company does not anticipate any wholly owned property acquisitions and pursuant to an existing commitment expects to purchase $17.6 million in land.

Dispositions

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

Development

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

JOINT VENTURE CAPITAL ACTIVITY

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

Acquisitions

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

Dispositions

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

Development

During the year ended December 31, 2008, joint ventures in which the Company held a 50% interest brought into service three Properties under Development representing 351,000 square feet and a Total Investment of $42.5 million. As of December 31, 2008, the projected Total Investment of JV Properties under Development was $186.4 million. For 2009, the Company expects unconsolidated joint ventures in which it holds an interest to bring into service $100 million to $175 million of Total Investment in operating properties.

Liberty/Commerz 1701 JFK Boulevard, LP

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

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

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

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

Forward-Looking Statements

When used throughout this report, the words “believes,” “anticipates” and “expects” and similar expressions are intended to identify forward-looking statements. Such statements indicate that assumptions have been used that are subject to a number of risks and uncertainties that could cause actual financial results or management plans and objectives to differ materially from those projected or expressed herein, including: the effect of national and regional economic conditions; rental demand; the Company’s ability to identify, and enter into agreements with suitable joint venture partners in situations where it believes such arrangements are advantageous; the Company’s ability to identify and secure additional properties and sites, both for itself and the joint ventures to which it is a party, that meet its criteria for acquisition or development; the current credit crisis and its impact on the availability and cost of capital; the effect of prevailing market interest rates; risks related to the integration of the operations of entities that we have acquired or may acquire; risks related to litigation; and other risks described from time to time in the Company’s filings with the SEC. Given these uncertainties, readers are cautioned not to place undue reliance on such statements.

Critical Accounting Policies and Estimates

The Company’s discussion and analysis of its financial condition and results of operations are based upon the Company’s consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires the Company to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. The Company bases these estimates, judgments and assumptions on historical experience and on other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

The following critical accounting policies discussion reflects what the Company believes are the more significant estimates, assumptions and judgments used in the preparation of its Consolidated Financial Statements. This discussion of critical accounting policies is intended to supplement the description of the accounting policies in the footnotes to the Company’s Consolidated Financial Statements and to provide additional insight into the information used by management when evaluating significant estimates, assumptions and judgments. For further discussion of our significant accounting policies, see Note 2 to the Consolidated Financial Statements included in this report.

Capitalized Costs

Expenditures directly related to the acquisition or improvement of real estate, including interest and other costs capitalized on development projects and land being readied for development, are included in net real estate and are stated at cost. The Company considers a development property substantially complete upon the completion of tenant build-out, but no later than one year after the completion of major construction activity. The capitalized costs include pre-construction costs essential to the development of the property, construction costs, interest costs, real estate taxes, development related salaries and other costs incurred during the period of development. The determination to capitalize rather than expense costs requires the Company to evaluate the status of the development activity. Capitalized interest for the years ended December 31, 2008, 2007 and 2006 was $20.0 million, $45.7 million and $30.8 million, respectively.

Revenue Recognition

Rental revenue is recognized on a straight line basis over the terms of the respective leases. Deferred rent receivable represents the amount by which straight line rental revenue exceeds rents currently billed in accordance with the lease agreements. Above-market and below-market lease values for acquired properties are recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i)

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the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease. The capitalized above or below-market lease values are amortized as a component of rental revenue over the remaining term of the respective leases.

Allowance for Doubtful Accounts

The Company monitors the liquidity and creditworthiness of its tenants on an on-going basis. Based on these reviews, provisions are established, and an allowance for doubtful accounts for estimated losses resulting from the inability of its tenants to make required rental payments is maintained. As of December 31, 2008 and 2007, the Company’s allowance for doubtful accounts totaled $8.5 million and $6.0 million, respectively. The Company’s bad debt expense for the years ended December 31, 2008, 2007 and 2006 was $4.8 million, $3.4 million and $1.0 million, respectively. During the year ended December 31, 2006, the Company realized $2.0 million from the settlement of a tenant bankruptcy.

Impairment of Real Estate

The Company evaluates its real estate investments upon occurrence of significant adverse changes in operations to assess whether any impairment indicators are present that could affect the recovery of the recorded value. Indicators the Company uses to determine whether an impairment evaluation is necessary includes the low occupancy level of the property, holding period for the property, strategic decisions regarding future development plans for a property under development and land held for development and other market factors. If impairment indicators are present the Company performs an undiscounted cash flow analysis and compares the net carrying amount of the property to the property’s estimated undiscounted future cash flow over the anticipated holding period. The Company assesses the expected undiscounted cash flows based upon estimated capitalization rates, historic operating results and market conditions that may affect the property. If any real estate investment is considered impaired, the carrying value of the property is written down to its estimated fair value. Fair value is estimated based on the discounting of future expected cash flows at a risk adjusted interest rate. During the years ended December 31, 2008, 2007 and 2006 the Company recognized impairment losses of $3.1 million, $0.2 million and $4.2 million, respectively. The determination of whether an impairment exists requires the Company to make estimates, judgments and assumptions about the future cash flows. The Company has evaluated each of its Properties and land held for development and has determined that there are no additional impairment charges that need to be recorded at December 31, 2008.

Intangibles

In accordance with the Financial Accounting Standards Board (“FASB”) Statement of Financial Standards (“SFAS”) No. 141, “Business Combinations,” the Company allocates the purchase price of real estate acquired to land, building and improvements and intangibles based on the relative fair value of each component. The value ascribed to in-place leases is based on the rental rates for the existing leases compared to the Company’s estimate of the fair market lease rates for leases of similar terms and present valuing the difference based on an interest rate which reflects the risks associated with the leases acquired. Origination values are also assigned to in-place leases, and, where appropriate, value is assigned to customer relationships. Origination cost estimates include the costs to execute leases with terms similar to the remaining lease terms of the in-place leases, including leasing commissions, legal and other related expenses. Additionally, the Company estimates carrying costs during the expected lease-up periods including real estate taxes, other operating expenses and lost rentals at contractual rates. The Company depreciates the amounts allocated to building and improvements over 40 years. The amounts allocated to the intangible relating to in-place leases, which are included in deferred financing and leasing costs or in other liabilities in the accompanying balance sheets, are amortized over the remaining term of the related leases. In the event that a tenant terminates its lease, the unamortized portion of the intangible is written off.

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

Investments in Unconsolidated Joint Ventures

The Company analyzes its investments in joint ventures under FASB Interpretation No. 46(R), “Consolidation of Variable Interest Entities,” to determine if the joint venture is considered a variable interest entity and would require consolidation. To the extent that the Company’s joint ventures do not qualify as variable interest entities, it

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completes a further assessment under the guidelines of Emerging Issues Task Force (“EITF”) Issue No. 04-5, “Determining Whether a General partner, or the General Partners as a Group, Controls a Limited Partnership or Similar Entity When the Limited Partners Have Certain Rights” (“EITF 04-5”) to determine if the venture should be consolidated. The Company does not have any interests in variable interest entities. The Company accounts for its investments in unconsolidated joint ventures using the equity method of accounting as the company exercises significant influence, but does not control these entities. These investments are recorded initially at cost, as Investments in Unconsolidated Joint Ventures, and subsequently adjusted for equity in earnings and cash contributions and distributions.

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

Results of Operations

The following discussion is based on the consolidated financial statements of the Company. It compares the results of operations of the Company for the year ended December 31, 2008 with the results of operations of the Company for the year ended December 31, 2007, and the results of operations of the Company for the year ended December 31, 2007 with the results of operations of the Company for the year ended December 31, 2006. As a result of the varying level of development, acquisition and disposition activities by the Company in 2008, 2007 and 2006, the overall operating results of the Company during such periods are not directly comparable. However, certain data, including the Same Store (as defined below) results, do lend themselves to direct comparison.

This information should be read in conjunction with the accompanying consolidated financial statements and notes included elsewhere in this report.

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

Overview

The Company’s average gross investment in operating real estate owned for the year ended December 31, 2008 increased to $5,084.3 million from $4,553.0 million for the year ended December 31, 2007. This increase in operating real estate owned resulted in increases in rental revenue, operating expense reimbursement, rental property operating expenses, real estate taxes and depreciation and amortization expense.

Total operating revenue increased to $748.5 million for the year ended December 31, 2008 from $686.8 million for the year ended December 31, 2007. This $61.7 million increase was primarily due to the increase in investment in operating real estate and the increase in operating revenue from the Same Store group of properties, discussed below. This increase was partially offset by a decrease in “Termination Fees,” which totaled $3.9 million for the year ended December 31, 2008 as compared to $4.2 million for the year ended December 31, 2007. Termination Fees are fees that the Company agrees to accept in consideration for permitting certain tenants to terminate their leases prior to the contractual expiration date. Termination Fees are included in rental revenue.

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Segments

The Company evaluates the performance of the Properties in Operation by reportable segment (see Note 13 to the Company’s financial statements for reconciliation to net income). The following table identifies changes in reportable segments (dollars in thousands):

Property Level Operating Income:

	Year Ended December 31,				Percentage
	2008		2007		Increase (Decrease)
Northeast
– Southeastern PA	$	120,778	$	115,192		4.8	%
– Lehigh/Central PA		72,440		68,015		6.5	% (1)
– New Jersey		23,156		26,934		(14.0	%) (2)
Midwest		51,890		52,865		(1.8	%)
Mid-Atlantic		100,891		90,075		12.0	% (3)
South		115,329		100,274		15.0	% (3)
Philadelphia		21,635		14,585		48.3	% (4)
United Kingdom		3,295		2,682		22.9	% (5)
Total property level operating income (6)	$	509,414	$	470,622		8.2	%

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

Same Store

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

Management generally considers the performance of the Same Store properties to be a useful financial performance measure because the results are directly comparable from period to period. Management further believes that the performance comparison should exclude Termination Fees since they are more event specific and are not representative of ordinary performance results. In addition, Same Store property level operating income exclusive of Termination Fees is considered by management to be a more reliable indicator of the portfolio’s baseline performance. The Same Store properties consist of the 590 properties totaling approximately 53.4 million square feet owned on January 1, 2007 and excluding properties sold through December 31, 2008.

Set forth below is a schedule comparing the property level operating income, on a straight line basis and on a cash basis, for the Same Store properties for the years ended December 31, 2008 and 2007. Same Store property level income is a non-GAAP measure and does not represent income before property dispositions, income taxes, minority interest and equity in (loss) earnings of unconsolidated joint ventures because it does not reflect the consolidated operations of the Company. Investors should review Same Store results, along with Funds from operations (see “Liquidity and Capital Resources” section), GAAP net income and cash flow from operating activities, investing activities and financing activities when considering the Company’s operating performance. Also, set forth below is a reconciliation of Same Store property level operating income to net income (in thousands).

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	Year Ended December 31,
	2008			2007
Same Store:
Rental revenue	$	447,731		$	448,489
Operating expenses:
Rental property expense		144,362			142,332
Real estate taxes		75,360			66,778
Operating expense recovery		(210,151	)		(201,520	)
Unrecovered operating expenses		9,571			7,590
Property level operating income		438,160			440,899
Less straight line rent		5,102			6,977
Cash basis property level operating income	$	433,058		$	433,922
Reconciliation of non-GAAP financial measure:
Property level operating income – Same Store	$	438,160		$	440,899
Property level operating income – properties purchased or developed subsequent to January 1, 2007		69,776			27,644
Less: Property level operating income – properties held for sale at December 31, 2008		(2,377	)		(2,084	)
Termination fees		3,855			4,163
General and administrative expense		(54,378	)		(54,249	)
Depreciation and amortization expense		(173,097	)		(155,616	)
Other income (expense)		(139,646	)		(115,331	)
Gain on property dispositions		10,572			1,463
Income taxes		(1,645	)		709
Minority interest		(27,062	)		(23,598	)
Equity in earnings (loss) of unconsolidated joint ventures		2,805			(226	)
Discontinued operations, net of minority interest		24,979			41,057
Net income	$	151,942		$	164,831

General and Administrative

General and administrative expenses were relatively unchanged with an expense of $54.4 million for the year ended December 31, 2008 compared to $54.2 million for the year ended December 31, 2007. Minor increases in compensation expense were offset by minor decreases in expenses for marketing and consulting services.

Depreciation and Amortization

Depreciation and amortization increased to $173.1 million for the year ended December 31, 2008 from $155.6 million for the year ended December 31, 2007. The increase was primarily due to the increase in average gross investment in operating real estate during the respective periods and particularly the increased investment in tenant improvement costs, which are depreciated over a shorter period than buildings.

Interest Expense

Interest expense increased to $155.7 million for the year ended December 31, 2008 from $127.1 million for the year ended December 31, 2007. This increase was related to an increase in the average debt outstanding, which was $2,833.9 million for the year ended December 31, 2008, compared to $2,677.9 million for the year ended December 31, 2007. The effect of the increase in the average debt outstanding was partially offset by a decrease in the weighted average interest rate to 6.1% for the year ended December 31, 2008 from 6.5% for the year ended December 31, 2007. Also contributing to the increase in interest expense was the decrease in interest that was capitalized due to the decrease in development activity.

Interest expense allocated to discontinued operations for the years ended December 31, 2008 and 2007 was $2.2 million and $7.0 million, respectively. This decrease was due to the decrease in the level of dispositions in 2008 compared to 2007.

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Other

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

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

Income from discontinued operations decreased to $25.0 million from $41.1 million for the year ended December 31, 2008 compared to the year ended December 31, 2007. The decrease is due to lower operating income and the decrease in gains recognized on sales which were $23.5 million for the year ended December 31, 2008 compared to $33.6 million for the year ended December 31, 2007.

As a result of the foregoing, the Company’s net income decreased to $151.9 million for the year ended December 31, 2008 from $164.8 million for the year ended December 31, 2007.

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

Overview

The Company’s average gross investment in operating real estate owned for the year ended December 31, 2007 increased to $4,553.0 million from $3,830.5 million for the year ended December 31, 2006. This increase in operating real estate resulted in increases in rental revenue, operating expense reimbursement, rental property operating expenses, real estate taxes and depreciation and amortization expense.

Total operating revenue increased to $686.8 million for the year ended December 31, 2007 from $607.6 million for the year ended December 31, 2006. This $79.2 million increase was primarily due to the increase in investment in operating real estate and the increase in operating revenue from the Prior Year Same Store group of properties, discussed below. These increases were partially offset by a decrease in Termination Fees, which totaled $4.2 million for the year ended December 31, 2007 as compared to $6.1 million for the year ended December 31, 2006. Termination Fees are included in rental revenue.

Segments

The Company evaluates the performance of the Properties in Operation by reportable segment (see Note 13 to the Company’s Consolidated Financial Statements for a reconciliation to net income). The following table identifies changes in reportable segments (dollars in thousands):

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Property Level Operating Income:

	Year Ended December 31,				Percentage
	2007		2006		Increase (Decrease)
Northeast
– Southeastern PA	$	115,192	$	114,046		1.0	%
– Lehigh/Central PA		68,015		63,415		7.3	% (1)
– New Jersey		26,934		26,456		1.8	%
Midwest		52,865		49,214		7.4	% (2)
Mid-Atlantic		90,075		80,668		11.7	% (2)
South		100,274		76,525		31.0	% (2)
Philadelphia		14,585		8,916		63.6	% (3)
United Kingdom		2,682		906		196.0	% (4)
Total property level operating income (5)	$	470,622	$	420,146		12.0	%

(1)	The increase for the year ended December 31, 2007 versus the year ended December 31, 2006 was primarily due to an increase in average gross investment in operating real estate. This increase was partially offset by a decrease in occupancy and a decrease in rental rates during 2007.
(2)	The increase for the year ended December 31, 2007 versus the year ended December 31, 2006 is primarily due to an increase in average gross investment in operating real estate and an increase in occupancy. This increase was partially offset by a decrease in rental rates during 2007.
(3)	The increase for the year ended December 31, 2007 versus the year ended December 31, 2006 was due to the effect of Comcast Center operation during the relevant periods. Comcast Center was a wholly owned 1.25 million square foot development property which came into service incrementally from the third quarter of 2007 through the first quarter of 2008.
(4)	The increase for the year ended December 31, 2007 versus the year ended December 31, 2006 was primarily due to an increase in average gross investment in operating real estate, an increase in rental rates and an increase in occupancy in 2007 compared to 2006.
(5)	See a reconciliation of property level operating income to net income in the Same Store comparison below.

Same Store

Property level operating income, exclusive of Termination Fees, for the “Prior Year Same Store” (as defined below) properties increased to $408.3 million for the year ended December 31, 2007 from $399.3 million for the year ended December 31, 2006, on a straight line basis and increased to $406.2 million for the year ended December 31, 2007 from $394.2 million for the year ended December 31, 2006 on a cash basis. These increases of 2.3% and 3.1%, respectively, were primarily due to an increase in occupancy and an increase in rental rates.

Management generally considers the performance of the Prior Year Same Store properties to be a useful financial performance measure because the results are directly comparable from period to period. Management further believes that the performance comparison should exclude Termination Fees since they are more event specific and are not representative of ordinary performance results. In addition, Prior Year Same Store property level operating income exclusive of Termination Fees is considered by management to be a more reliable indicator of the portfolio’s baseline performance. The Prior Year Same Store properties consist of the 561 properties totaling approximately 50.2 million square feet owned on January 1, 2006 and excluding properties sold through December 31 2007.

Set forth below is a schedule comparing the property level operating income, on a straight line basis and on a cash basis, for the Prior Year Same Store properties for the years ended December 31, 2007 and 2006. Prior Year Same Store property level income is a non-GAAP measure and does not represent income before property dispositions, income taxes, minority interest, and equity in earnings of unconsolidated joint ventures because it does not reflect the consolidated operations of the Company. Investors should review Prior Year Same Store results, along with Funds from operations (see “Liquidity and Capital Resources” section), GAAP net income and cash flow from operating activities, investing activities and financing activities when considering the Company’s operating performance. Also, set forth below is a reconciliation of Prior Year Same Store property level operating income to net income (in thousands).

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	Year Ended December 31,
	2007			2006
Prior Year Same Store:
Rental revenue	$	414,197		$	406,063
Operating expenses:
Rental property expense		131,698			123,156
Real estate taxes		62,157			61,294
Operating expense recovery		(188,006	)		(177,680	)
Unrecovered operating expenses		5,849			6,770
Property level operating income		408,348			399,293
Less straight line rent		2,111			5,091
Cash basis property level operating income	$	406,237		$	394,202
Reconciliation of non-GAAP financial measure:
Property level operating income – prior year Same Store	$	408,348		$	399,293
Property level operating income – properties purchased or developed subsequent to January 1, 2006		65,110			21,352
Less: Property level operating income – 2008 discontinued operations		(7,001	)		(6,561	)
Termination fees		4,165			6,062
General and administrative expense		(54,249	)		(46,332	)
Depreciation and amortization expense		(155,616	)		(132,106	)
Other income (expense)		(115,331	)		(100,789	)
Gain on property dispositions		1,463			17,628
Income taxes		709			(288	)
Minority interest		(23,598	)		(19,801	)
Equity in (loss) earnings of unconsolidated joint ventures		(226	)		1,432
Discontinued operations at December 31, 2007		38,976			124,379
2008 discontinued operations		2,081			2,305
Net income	$	164,831		$	266,574

General and Administrative

General and administrative expenses increased to $54.2 million for the year ended December 31, 2007 from $46.3 million for the year ended December 31, 2006. This increase was primarily due to increases in salaries and increases in personnel consistent with the increase in the size of the Company. The increase in general and administrative expenses was also due to the expensing of costs relating to the acquisition of Republic and an increase in cancelled project costs.

Depreciation and Amortization

Depreciation and amortization increased to $155.6 million for the year ended December 31, 2007 from $132.1 million for the year ended December 31, 2006. The increase was primarily due to the increase in gross investment in operating real estate during the respective periods and particularly the increased investment in tenant improvement costs, which are depreciated over a relatively shorter period than buildings.

Interest Expense

Interest expense increased to $127.1 million for the year ended December 31, 2007 from $109.5 million for the year ended December 31, 2006. This increase was related to an increase in the average debt outstanding, which was $2,677.9 million for the year ended December 31, 2007, compared to $2,263.9 million for the year ended December 31, 2006. The effect of the increase in the average debt outstanding was partially offset by an increase in capitalized interest costs and a decrease in the weighted average interest rate to 6.5% for the year ended December 31, 2007 from 6.6% for the year ended December 31, 2006.

Interest expense allocated to discontinued operations for the years ended December 31, 2007 and 2006 was $7.0 million and $14.8 million, respectively. This decrease was due to the decrease in the level of dispositions in 2007 compared to 2006.

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Other

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

Income from discontinued operations decreased to $41.1 million from $126.7 million for the year ended December 31, 2007 compared to the year ended December 31, 2006. The decrease is due to lower operating income and the decrease in gains recognized on sales which were $33.6 million for the year ended December 31, 2007 compared to $112.6 million for the year ended December 31, 2006.

As a result of the foregoing, the Company’s net income decreased to $164.8 million for the year ended December 31, 2007 from $266.6 million for the year ended December 31, 2006.

Liquidity and Capital Resources

Overview

The uncertainty in the global credit markets has negatively affected the unsecured debt markets. As a result, the Company will be more reliant on the secured debt market as a source of financing in 2009. The Company anticipates that it will need approximately $150 million during 2009 to complete its December 31, 2008 development pipeline and to fund 2009 development starts. The Company’s 2009 debt maturities total approximately $320 million. The Company believes that proceeds from asset sales and from secured debt financing will provide it with sufficient funds to satisfy these obligations. The Company expects to realize approximately $125 million to $200 million in proceeds from asset sales in 2009 and it currently has commitments for approximately $300 million in secured debt financings that it expects will fund in 2009. From January 1, 2009 through February 23, 2009, the Company has sold six Properties in Operation for $34.8 million and it has closed on $193.2 million in secured debt financings.

Activity

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

Net cash flow provided by operating activities decreased to $268.5 million for the year ended December 31, 2008 from $346.8 million for the year ended December 31, 2007. This $78.3 million decrease was primarily due to a change in restricted cash and the timing of payments on account. The change in restricted cash is due to the release of restricted funds in the United Kingdom for the payment of infrastructure costs. Net cash flow provided by operating activities is the primary source of liquidity to fund distributions to shareholders and for the recurring capital expenditures and leasing transaction costs for the Company’s Wholly Owned Properties in Operation.

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

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

The Company funds its development and acquisitions with long-term capital sources and proceeds from the disposition of properties. For the year ended December 31, 2008, a significant portion of these activities were funded through a $600 million Credit Facility (the “$600 million Credit Facility”). The interest rate on borrowings under the $600 million Credit Facility fluctuates based upon ratings from Moody’s Investors Service, Inc. (“Moody’s”), Standard and Poor’s Ratings Group (“S&P”) and Fitch, Inc. (“Fitch”). The current ratings for the Company’s senior unsecured debt are Baa2, BBB and BBB+ from Moody’s, S&P and Fitch, respectively. At these ratings, the interest rate for borrowings under the $600 million Credit Facility is 65 basis points over LIBOR. The $600 million Credit

36

Facility contains an accordion feature whereby the Company may borrow an additional $200 million. The Credit Facility expires in January 2010, and has a one-year extension option. The fee for the one-year extension is $900,000.

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

The Company uses debt financing to lower its overall cost of capital in an attempt to increase the return to shareholders. The Company staggers its debt maturities and maintains debt levels it considers to be prudent. In determining its debt levels, the Company considers various financial measures including the debt to gross assets ratio and the fixed charge coverage ratio. As of December 31, 2008 the Company’s debt to gross assets ratio was 41.8%, and for the year ended December 31, 2008, the fixed charge coverage ratio was 2.4x. Debt to gross assets equals total long-term debt, borrowings under the Credit Facility divided by total assets plus accumulated depreciation. The fixed charge coverage ratio equals income from continuing operations before property dispositions and minority interest, including operating activity from discontinued operations, plus interest expense and depreciation and amortization, divided by interest expense, including capitalized interest, plus distributions on preferred units.

As of December 31, 2008, $198.6 million in mortgage loans and $2,131.6 million in unsecured notes were outstanding with a weighted average interest rate of 6.6%. The interest rates on $2,327.5 million of mortgage loans and unsecured notes are fixed and range from 5.0% to 8.8%. The weighted average remaining term for these mortgage loans and unsecured notes is 4.9 years.

The Company’s contractual obligations, as of December 31, 2008, are as follows (in thousands):

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

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

General

The Company believes that its existing sources of capital will provide sufficient funds to finance its continued development and acquisition activities. The Company’s existing sources of capital include the public debt and equity markets, proceeds from secured financing of properties, proceeds from property dispositions, equity capital from joint venture partners and net cash provided by operating activities. Additionally, the Company expects to incur variable rate debt, including borrowings under the $600 million Credit Facility, from time to time.

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

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

37

were subsequently drawn to pay a portion of the cash merger consideration for the purchase of Republic Property Trust.

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

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

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

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

In December 2008, the Company commenced the sale of up to $150.0 million of Common Shares pursuant to a continuous offering program. Through December 31, 2008, the Company sold 495,000 Common Shares as part of this program. From January 1, 2009 through February 23, 2009, the Company sold an additional 2.3 million Common Shares through this program. The net proceeds from the offering of $10.8 million through December 31, 2008 and of $47.4 million from January 1, 2009 through February 23, 2009 were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes. Through February 23, 2009, the Company paid Citigroup Global Markets Inc., its agent under this program, an aggregate of $1.2 million in fees with respect to the Common Shares sold through this program.

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

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

Off-Balance Sheet Arrangements

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

Calculation of Funds from Operations

The National Association of Real Estate Investment Trusts (“NAREIT”) has issued a standard definition for Funds from operations (as defined below). The SEC has agreed to the disclosure of this non-GAAP financial measure on a per share basis in its Release No. 34-47226, Conditions for Use of Non-GAAP Financial Measures. The Company believes that the calculation of Funds from operations is helpful to investors and management as it is a measure of the Company’s operating performance that excludes depreciation and amortization and gains and losses from property dispositions. As a result, year over year comparison of Funds from operations reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses, and interest costs, providing perspective not immediately apparent from net income. In addition, management believes that Funds from operations provides useful information to the investment community about the Company’s financial performance when compared to other REITs since Funds from operations is generally recognized as the standard for reporting the operating performance of a REIT. Funds from operations available to common shareholders is defined by NAREIT as net income (computed in accordance with generally accepted accounting principles (“GAAP”)), excluding gains (or losses) from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Funds from operations available to common shareholders does not represent net income or cash flows from operations as defined by GAAP and does not necessarily indicate that cash flows will be sufficient to fund cash needs. It should not be considered as an alternative to net income as an indicator of the Company’s operating performance or to cash flows as a measure of liquidity. Funds from operations available to common shareholders also does not represent cash flows generated from operating, investing or financing activities as defined by GAAP.

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

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

Inflation

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

39

increased operating costs, such as insurance, real estate taxes and utilities, substantially all of the tenants’ leases require the tenants to absorb these costs as part of their rental obligations. In addition, inflation also may have the effect of increasing market rental rates.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The following discussion about the Company’s risk management includes forward-looking statements that involve risks and uncertainties. Actual results could differ materially from the results discussed in the forward-looking statements.

The carrying value of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued interest, dividends and distributions payable and other liabilities are reasonable estimates of fair value because of the short-term nature of these instruments. The fair value of the Company’s long-term debt, which is based on estimates by management and on rates quoted on December 31, 2008 for comparable loans, is less than the aggregate carrying value by approximately $713.1 million at December 31, 2008.

The Company’s primary market risk exposure is to changes in interest rates. The Company is exposed to market risk related to its $600 million Credit Facility and certain other indebtedness as discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources.” The interest on the $600 million Credit Facility and certain other indebtedness is subject to fluctuations in the market.

The Company also uses long-term and medium-term debt as a source of capital. These debt instruments are typically issued at fixed interest rates. When these debt instruments mature, the Company typically refinances such debt at then-existing market interest rates which may be more or less than the interest rates on the maturing debt. In addition, the Company may attempt to reduce interest rate risk associated with a forecasted issuance of new debt. In order to reduce interest rate risk associated with these transactions, the Company occasionally enters into interest rate protection agreements.

If the interest rates for variable rate debt were 100 basis points higher or lower during 2008, the Company’s interest expense would have increased or decreased by $3.6 million. If the interest rate for the fixed rate debt maturing in 2009 was 100 basis points higher or lower than its current rate of 6.9%, the Company’s interest expense would have increased or decreased by $170,000.

The sensitivity analysis above assumes no changes in the Company’s financial structure. It also does not consider future fluctuations in interest rates or the specific actions that might be taken by management to mitigate the impact of such fluctuations.

The Company is also exposed to currency risk on its net investment in the United Kingdom. The Company does not believe that this currency risk exposure is material to its financial statements.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The dual presentation of financial statements for the Company is required by the SEC. The Company is comprised of two SEC registrants: Liberty Property Trust and Liberty Property Limited Partnership. Accordingly, financial statements are required for each registrant. The financial information contained within the two sets of financial statements is essentially the same.

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Management’s Annual Report on Internal Control Over Financial Reporting

To the Shareholders of Liberty Property Trust:

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a – 15 (f) and 15d – 15(f). The Company’s internal control system was designed to provide reasonable assurance to the Company’s management and Board of Trustees regarding the preparation and fair presentation of published financial statements.

Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2008. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commissions (COSO) in Internal Control – Integrated Framework. Based on our assessment we believe that, as of December 31, 2008, the Company’s internal control over financial reporting is effective based on those criteria.

The Company’s independent registered public accounting firm, Ernst & Young LLP, has issued an attestation report on the Company’s internal controls over financial reporting, which is included in this Annual Report on Form 10-K.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

February 27, 2009

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Report of Independent Registered Public Accounting Firm

The Board of Trustees and Shareholders of Liberty Property Trust

We have audited Liberty Property Trust’s (the “Trust”) internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). The Trust’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Trust’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Liberty Property Trust maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets as of December 31, 2008 and 2007, and the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2008 of Liberty Property Trust and our report dated February 25, 2009 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania
February 25, 2009

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Report of Independent Registered Public Accounting Firm

The Board of Trustees and Shareholders of Liberty Property Trust

We have audited the accompanying consolidated balance sheets of Liberty Property Trust (the “Trust”) as of December 31, 2008 and 2007, and the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2008. Our audits also included the financial statement schedule listed in the Index at Item 15. These financial statements and schedule are the responsibility of the Trust’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

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

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

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Liberty Property Trust’s internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 25, 2009 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania
February 25, 2009

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

	December 31,
	2008			2007
ASSETS
Real estate:
Land and land improvements	$	813,397		$	792,991
Buildings and improvements		4,260,121			4,408,309
Less accumulated depreciation		(982,114	)		(858,671	)
Operating real estate		4,091,404			4,342,629
Development in progress		245,463			316,985
Land held for development		209,551			247,124
Net real estate		4,546,418			4,906,738
Cash and cash equivalents		15,794			37,989
Restricted cash		39,726			34,567
Accounts receivable, net		12,985			15,908
Deferred rent receivable		85,352			79,720
Deferred financing and leasing costs, net		134,029			144,295
Investments in and advances to unconsolidated joint ventures		266,602			278,383
Assets held for sale		33,662			36,908
Prepaid expenses and other assets		82,467			109,429
Total assets	$	5,217,035		$	5,643,937
LIABILITIES
Mortgage loans	$	198,560		$	243,169
Unsecured notes		2,131,607			2,155,000
Credit facility		260,000			622,960
Accounts payable		32,481			44,666
Accrued interest		36,474			39,725
Dividends and distributions payable		48,858			59,849
Other liabilities		182,549			268,926
Total liabilities		2,890,529			3,434,295
Minority interest		369,771			372,621
SHAREHOLDERS’ EQUITY
Common shares of beneficial interest, $.001 par value, 183,987,000 shares authorized, 100,034,404 (includes 1,249,909 in treasury) and 92,817,879 (includes 1,249,909 in treasury) shares issued and outstanding as of December 31, 2008 and 2007, respectively		101			93
Additional paid-in capital		2,199,684			1,984,141
Accumulated other comprehensive (loss) income		(5,378	)		21,378
Distributions in excess of net income		(185,721	)		(116,640	)
Common Shares held in treasury, at cost, 1,249,909 shares as of December 31, 2008 and 2007		(51,951	)		(51,951	)
Total shareholders’ equity		1,956,735			1,837,021
Total liabilities and shareholders’ equity	$	5,217,035		$	5,643,937

See accompanying notes.

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

	Year Ended December 31,
	2008			2007			2006
OPERATING REVENUE
Rental	$	520,301		$	480,107		$	426,874
Operating expense reimbursement		228,219			206,724			180,688
Total operating revenue		748,520			686,831			607,562
OPERATING EXPENSE
Rental property		152,786			143,646			122,826
Real estate taxes		86,320			72,563			64,590
General and administrative		54,378			54,249			46,332
Depreciation and amortization		173,097			155,616			132,106
Total operating expenses		466,581			426,074			365,854
Operating income		281,939			260,757			241,708
OTHER INCOME (EXPENSE)
Interest and other income		13,508			11,727			8,693
Debt extinguishment gain		2,521			—			—
Interest expense		(155,675	)		(127,058	)		(109,482	)
Total other income (expense)		(139,646	)		(115,331	)		(100,789	)
Income before property dispositions, income taxes, minority interest and equity in earnings (loss) of unconsolidated joint ventures		142,293			145,426			140,919
Gain on property dispositions		10,572			1,463			17,628
Income taxes		(1,645	)		709			(288	)
Minority interest		(27,062	)		(23,598	)		(19,801	)
Equity in earnings (loss) of unconsolidated joint ventures		2,805			(226	)		1,432
Income from continuing operations		126,963			123,774			139,890
Discontinued operations, net of minority interest (including net gain on property dispositions of $23,519, $33,611, and $112,620 for the years ended December 31, 2008, 2007 and 2006, respectively)		24,979			41,057			126,684
Net income	$	151,942		$	164,831		$	266,574
Earnings per share
Basic:
Income from continuing operations	$	1.35		$	1.36		$	1.56
Income from discontinued operations		0.27			0.45			1.42
Income per common share – basic	$	1.62		$	1.81		$	2.98
Diluted:
Income from continuing operations	$	1.35		$	1.35		$	1.55
Income from discontinued operations		0.27			0.45			1.40
Income per common share – diluted	$	1.62		$	1.80		$	2.95
Weighted average number of Common Shares outstanding
Basic		93,624			91,185			89,313
Diluted		93,804			91,803			90,492

See accompanying notes.

45

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY OF LIBERTY PROPERTY TRUST
(IN THOUSANDS)

	Common					Accumulated						Common
	Shares of		Additional			Other			Distributions			Shares			Total
	Beneficial		Paid-In			Comprehensive			in Excess of			Held			Shareholders’
	Interest		Capital			Income			Net Income			in Treasury			Equity
Balance at January 1, 2006	$	88	$	1,799,068		$	9,906		$	(98,553	)	$	(1,327	)	$	1,709,182
Net proceeds from the issuance of Common Shares		3		87,040			—			—			—			87,043
Net income		—		—			—			266,574			—			266,574
Distributions on Common Shares		—		—			—			(221,907	)		—			(221,907	)
Noncash compensation		—		6,212			—			—			—			6,212
Minority interest reclassification		—		14,083			—			—			—			14,083
Foreign currency translation adjustment		—		—			10,417			—			—			10,417
Balance at December 31, 2006		91		1,906,403			20,323			(53,886	)		(1,327	)		1,871,604
Net proceeds from the issuance of Common Shares		2		70,353			—			—			—			70,355
Net income		—		—			—			164,831			—			164,831
Distributions on Common Shares		—		—			—			(227,585	)		—			(227,585	)
Purchase of treasury shares		—		—			—			—			(50,624	)		(50,624	)
Noncash compensation		—		8,128			—			—			—			8,128
Minority interest reclassification		—		(743	)		—			—			—			(743	)
Foreign currency translation adjustment		—		—			1,055			—			—			1,055
Balance at December 31, 2007		93		1,984,141			21,378			(116,640	)		(51,951	)		1,837,021
Net proceeds from the issuance of Common Shares		8		206,341			—			—			—			206,349
Net income		—		—			—			151,942			—			151,942
Distributions on Common Shares		—		—			—			(221,023	)		—			(221,023	)
Purchase of treasury shares		—		—			—			—			—			—
Noncash compensation		—		9,152			—			—			—			9,152
Minority interest reclassification		—		50			—			—			—			50
Foreign currency translation adjustment		—		—			(26,756	)		—			—			(26,756	)
Balance at December 31, 2008	$	101	$	2,199,684		$	(5,378	)	$	(185,721	)	$	(51,951	)	$	1,956,735

See accompanying notes.

46

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

	Year Ended December 31,
	2008			2007			2006
OPERATING ACTIVITIES
Net income	$	151,942		$	164,831		$	266,574
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		175,236			163,665			151,966
Amortization of deferred financing costs		4,429			4,137			4,244
Equity in (earnings) loss of unconsolidated joint ventures		(2,805	)		226			(1,432	)
Distributions from unconsolidated joint ventures		1,660			3,550			5,692
Minority interest in net income		28,164			25,479			25,469
Gain on property dispositions		(34,091	)		(35,074	)		(130,248	)
Noncash compensation		9,152			8,128			6,212
Changes in operating assets and liabilities:
Restricted cash		(10,903	)		26,211			(21,692	)
Accounts receivable		(4,277	)		4,634			(6,879	)
Deferred rent receivable		(13,482	)		(13,455	)		924
Prepaid expenses and other assets		(26,326	)		(14,145	)		(14,394	)
Accounts payable		(10,913	)		3,974			7,648
Accrued interest		(3,251	)		3,428			1,405
Other liabilities		3,935			1,163			29,084
Net cash provided by operating activities		268,470			346,752			324,573
INVESTING ACTIVITIES
Investment in properties		(60,078	)		(307,846	)		(372,610	)
Cash paid for business, net of cash acquired		—			(626,007	)		—
Investments in and advances to unconsolidated joint ventures		58,250			(227,385	)		(6,239	)
Net proceeds from disposition of properties/land		382,956			996,474			492,548
Investment in development in progress		(247,393	)		(417,877	)		(339,631	)
Investment in land held for development		(47,857	)		(137,051	)		(79,976	)
Increase in deferred leasing costs		(33,325	)		(39,232	)		(29,034	)
Net cash provided by (used in) investing activities		52,553			(758,924	)		(334,942	)
FINANCING ACTIVITIES
Net proceeds from issuance of Common Shares		206,349			70,355			87,043
Purchase of treasury shares		—			(50,624	)		—
Net proceeds from issuance of preferred units		—			99,958			26,305
Redemption of preferred units		—			(23,653	)		—
Net proceeds from issuance of notes payable		—			415,063			—
Repayments of notes payable		—			(415,063	)		—
Net proceeds from issuance of unsecured notes		—			446,205			295,393
Repayments of unsecured notes		(23,393	)		(250,000	)		(100,000	)
Proceeds from mortgage loans		2,667			—			—
Repayments of mortgage loans		(46,452	)		(16,365	)		(56,406	)
Proceeds from credit facility		572,300			1,363,050			725,025
Repayments on credit facility		(782,300	)		(987,050	)		(733,515	)
Increase in deferred financing costs		(33	)		(1,224	)		(1,635	)
Distributions paid on Common Shares		(231,325	)		(226,718	)		(219,873	)
Distributions paid on units		(31,648	)		(27,612	)		(22,664	)
Net cash (used in) provided by financing activities		(333,835	)		396,322			(327	)
Decrease in cash and cash equivalents		(12,812	)		(15,850	)		(10,696	)
(Decrease) increase in cash and cash equivalents related to foreign currency translation		(9,383	)		102			2,804
Cash and cash equivalents at beginning of year		37,989			53,737			61,629
Cash and cash equivalents at end of year	$	15,794		$	37,989		$	53,737
SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS
Write-off of fully depreciated property and deferred costs	$	31,421		$	102,902		$	87,424
Issuance of operating partnership common units		—			—			30,000
Acquisition of properties		—			(73,556	)		(3,066	)
Assumption of mortgage loans		—			73,556			3,066

See accompanying notes.

47

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF LIBERTY PROPERTY TRUST

1. ORGANIZATION

Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (a “REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by Liberty Property Limited Partnership (the “Operating Partnership” and, together with the Trust and their consolidated subsidiaries, the “Company”). The Trust is the sole general partner and also a limited partner of the Operating Partnership, owning 96.0% of the common equity of the Operating Partnership at December 31, 2008. The Company provides leasing, property management, development, acquisition, and other tenant-related services for a portfolio of industrial and office properties which are located principally within the Mid-Atlantic, Southeastern, Midwestern and Southwestern United States and the United Kingdom.

All square footage amounts are unaudited.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“US GAAP”) requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Principles of Consolidation

The consolidated financial statements of the Company include the Trust, the Operating Partnership and wholly owned subsidiaries and those subsidiaries in which the Company owns a majority voting interest with the ability to control operations of the subsidiaries and where no approval, veto or other important rights have been granted to the minority shareholders. All significant intercompany transactions and accounts have been eliminated.

Reclassifications

Certain amounts from prior years have been reclassified to conform to current-year presentation.

Real Estate and Depreciation

The properties are recorded at cost and are depreciated using the straight line method over their estimated useful lives. The estimated useful lives are as follows:

Building and improvements	40 years (blended)
Capital improvements	15 – 20 years
Equipment	5 – 10 years
Tenant improvements	Term of the related lease

Expenditures directly related to acquisition or improvement of real estate, including interest and other costs capitalized during development, are included in net real estate and are stated at cost. The capitalized costs include pre-construction costs essential to the development of the property, development and construction costs, interest costs, real estate taxes, development-related salaries and other costs incurred during the period of development. Expenditures for maintenance and repairs are charged to operations as incurred.

In accordance with the Financial Accounting Standards Board (“FASB”) Statement of Financial Standards (“SFAS”) No. 141, “Business Combinations,” the Company allocates the purchase price of real estate acquired to land, building and improvements and intangibles based on the relative fair value of each component. The value ascribed to in-place leases is based on the rental rates for the existing leases compared to market rent for leases of similar terms and present valuing the difference based on market interest rates. Origination values are also assigned to in-place leases, and, where appropriate, value is assigned to customer relationships. The Company depreciates the amounts allocated to building and improvements over 40 years and the amounts allocated to intangibles relating to in-place leases, which are included in deferred financing and leasing costs and other liabilities in the accompanying consolidated balance sheets, over the remaining term of the related leases.

Once a property is designated as held for sale, no further depreciation expense is recorded. Operations for properties identified as held for sale and/or sold where no continuing involvement exists are presented in discontinued operations for all periods presented.

48

The Company evaluates its real estate investments upon occurrence of a significant adverse change in its operations to assess whether any impairment indicators are present that affect the recovery of the recorded value. If any real estate investment is considered impaired, a loss is recognized to reduce the carrying value of the property to its estimated fair value.

Investments in Unconsolidated Joint Ventures

The Company accounts for its investments in unconsolidated joint ventures using the equity method of accounting as the Company exercises significant influence, but does not control these entities. Under the equity method of accounting, the net equity investment of the Company is reflected in the accompanying consolidated balance sheets and the Company’s share of net income from the joint ventures is included in the accompanying consolidated statements of operations.

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

Cash and Cash Equivalents

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

Restricted Cash

Restricted cash includes tenant security deposits and escrow funds that the Company maintains pursuant to certain mortgage loans. Restricted cash also includes the undistributed proceeds from the sale of residential land in Kent County, United Kingdom.

Accounts Receivable/Deferred Rent Receivable

The Company’s accounts receivable are comprised of rents and charges for property operating costs due from tenants. The Company periodically performs a detailed review of amounts due from tenants to determine if accounts receivable balances are collectible. Based on this review, accounts receivable are reduced by an allowance for doubtful accounts. The Company considers tenant credit quality and payment history and general economic conditions in determining the allowance for doubtful accounts. If the accounts receivable balance is subsequently deemed uncollectible, the receivable and allowance for doubtful account balance is written off.

The Company’s deferred rent receivable represents the cumulative difference between rent revenue recognized on a straight line basis and contractual payments due under the terms of tenant leases.

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

Goodwill

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

49

Revenues

The Company earns rental income under operating leases with tenants. Rental income is recognized on a straight line basis over the applicable lease term. Operating expense reimbursements consisting of amounts due from tenants for real estate taxes, utilities and other recoverable costs are recognized as revenue in the period in which the corresponding expenses are incurred.

Termination fees (included in rental revenue) are fees that the Company has agreed to accept in consideration for permitting certain tenants to terminate their lease prior to the contractual expiration date. The Company recognizes termination fees in accordance with Staff Accounting Bulletin 104 when the following conditions are met:

a)	the termination agreement is executed,
b)	the termination fee is determinable,
c)	all landlord services pursuant to the terminated lease have been rendered, and
d)	collectability of the termination fee is assured.

Deferred Financing and Leasing Costs

Costs incurred in connection with financing or leasing are capitalized and amortized over the term of the related loan or lease. Deferred financing cost amortization is reported as interest expense. Intangible assets related to acquired in-place leases are amortized over the terms of the related leases.

Costs Incurred for Preferred Unit Issuance

Costs incurred in connection with the Company’s preferred unit issuances are reflected as a reduction of minority interest.

Income per Common Share

The following table sets forth the computation of basic and diluted income per common share (in thousands, except per share amounts):

	2008						2007
			Weighted						Weighted
			Average						Average
	Income		Shares		Per		Income		Shares		Per
	(Numerator)		(Denominator)		Share		(Numerator)		(Denominator)		Share
Basic income from continuing operations
Income from continuing operations	$	126,963		93,624	$	1.35	$	123,774		91,185	$	1.36
Dilutive shares for long-term compensation plans		—		180				—		618
Diluted income from continuing operations
Income from continuing operations and assumed conversions		126,963		93,804	$	1.35		123,774		91,803	$	1.35
Basic income from discontinued operations
Discontinued operations net of minority interest		24,979		93,624	$	0.27		41,057		91,185	$	0.45
Dilutive shares for long-term compensation plans		—		180				—		618
Diluted income from discontinued operations
Discontinued operations net of minority interest		24,979		93,804	$	0.27		41,057		91,803	$	0.45
Basic income per common share
Net income		151,942		93,624	$	1.62		164,831		91,185	$	1.81
Dilutive shares for long-term compensation plans		—		180				—		618
Diluted income per common share
Net income and assumed conversions	$	151,942		93,804	$	1.62	$	164,831		91,803	$	1.80

50

	2006
			Weighted
			Average
	Income		Shares		Per
	(Numerator)		(Denominator)		Share
Basic income from continuing operations
Income from continuing operations	$	139,890		89,313	$	1.56
Dilutive shares for long-term compensation plans		—		1,179
Diluted income from continuing operations
Income from continuing operations and assumed conversions		139,890		90,492	$	1.55
Basic income from discontinued operations
Discontinued operations net of minority interest		126,684		89,313	$	1.42
Dilutive shares for long-term compensation plans		—		1,179
Diluted income from discontinued operations
Discontinued operations net of minority interest		126,684		90,492	$	1.40
Basic income per common share
Net income		266,574		89,313	$	2.98
Dilutive shares for long-term compensation plans		—		1,179
Diluted income per common share
Net income and assumed conversions	$	266,574		90,492	$	2.95

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

Fair Value of Financial Instruments

The carrying value of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued interest, dividends and distributions payable and other liabilities are reasonable estimates of fair values because of the short-term nature of these instruments. The fair value of the Company’s long-term debt, which is based on estimates by management and on rates quoted on December 31, 2008 for comparable loans, is less than the aggregate carrying value by approximately $713.1 million at December 31, 2008.

Income Taxes

The Company has elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”). As a result, the Company generally is not subject to federal income taxation at the corporate level to the extent it distributes annually at least 100% of its REIT taxable income, as defined in the Code, to its shareholders and satisfies certain other organizational and operational requirements. The Company has met these requirements and, accordingly, no provision has been made for federal income taxes in the accompanying consolidated financial statements. If the Company fails to qualify as a REIT in any taxable year, the Company will be subject to federal income tax on its taxable income at regular corporate rates (including any alternative minimum tax) and may not be able to qualify as a REIT for the four subsequent taxable years. Even as a REIT, the Company may be subject to certain state and local income and property taxes, and to federal income and excise taxes on undistributed taxable income.

Several of the Company’s subsidiaries are taxable REIT subsidiaries (each a “TRS”) and are subject to federal income taxes.  In general, a TRS may perform additional services for tenants and generally may engage in real estate or non-real estate business that are not permitted REIT activities.  The Company is also taxed in certain states, the United Kingdom, and Luxembourg.  Accordingly, the Company has recognized federal, state and foreign income taxes in accordance with US GAAP, as applicable. 

In July 2006 the FASB issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 is an interpretation of SFAS No. 109, “Accounting for Income Taxes.” The Company adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, no uncertain tax positions were identified which would result in the recording of a liability for unrecognized tax benefits, and correspondingly no benefit recognition was identified that would affect the effective tax rate. Additionally, there are no possibly significant unrecognized tax benefits which are reasonably expected to occur within the next 12 months. The Company’s policy is to recognize interest accrued related to unrecognized benefits in interest expense and penalties in other expense. There are no interest and penalties deducted in the current period and no interest and penalties accrued at December 31, 2008 and December 31, 2007.

51

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

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

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

Share Based Compensation

At December 31, 2008, the Company had share-based employee compensation plans as fully described in Note 10. Effective January 1, 2006 the Company adopted the provisions of SFAS No. 123(R), “Share-Based Payment” (“SFAS No. 123(R)”), using the modified prospective application method. In accordance with SAFS No.123(R), share-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as expense over the employees’ requisite service period. In January 2003, the Company adopted the fair value recognition provisions of SFAS No. 123, “Accounting for Stock-Based Compensation,” prospectively for all employee option awards granted, modified, or settled after January 1, 2003. Prior to 2003, the Company accounted for its compensation plan under the recognition and measurement provisions of Accounting Principles Board (“APB”) Opinion No. 25, “Accounting for Stock Issued to Employees,” and related Interpretations.

Under the modified prospective application method, results for prior periods have not been restated to reflect the effects of implementing SFAS No. 123(R).

Foreign Currency Translation

The functional currency of the Company’s United Kingdom operations is pounds sterling. The Company translates the financial statements for the United Kingdom operations into US dollars. Gains and losses resulting from this translation do not impact the results of operations and are included in accumulated other comprehensive (loss) income as a separate component of shareholders’ equity. Accumulated other comprehensive (loss) income consists solely of the foreign currency translation adjustments described. Other comprehensive (loss) income was ($26.8) million, $1.1 million and $10.4 million for the years ended December 31, 2008, 2007 and 2006, respectively. Upon sale or upon complete or substantially complete liquidation of a foreign investment, the gain or loss on the sale will include the cumulative translation adjustments that have been previously recorded in accumulated other comprehensive income.

Recently Issued Accounting Standards

SFAS No. 157

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS No. 157”), which defines fair value, establishes a framework for consistently measuring fair value under US GAAP and expands disclosures about fair value measurements. The hierarchy is measured in three levels based on the reliability of inputs:

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

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

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

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

52

SFAS No. 159

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

SFAS No. 141(R)

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

SFAS No. 160

In December 2007, the FASB issued SFAS No. 160, “Accounting for Noncontrolling Interests” (“SFAS No. 160”). Under this statement, noncontrolling interests are considered equity and thus the Company’s practice of reporting minority interests in the mezzanine section of the balance sheet will be eliminated. Also, under SFAS No. 160, net income will encompass the total income of all consolidated subsidiaries and there will be separate disclosure on the face of the statement of operations of the attribution of that income between controlling and noncontrolling interests. Finally, increases and decreases in noncontrolling interests will be treated as equity transactions.  The standard is effective on January 1, 2009. The Company does not anticipate that the adoption of this statement will have a material effect on its financial position or results of operations.

FSP EITF 03-6-1

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

3. REAL ESTATE

The Company owns and operates industrial and office properties located principally in suburban mixed-use developments or business parks. The carrying value of these properties by type as of December 31, 2008 and 2007 is as follows (in thousands):

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

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

As of December 31, 2008, the Company had commenced development on 17 properties, which upon completion are expected to comprise 3.2 million square feet of leaseable space. As of December 31, 2008, $245.5 million had been

53

expended for the development of these projects and an additional $128.1 million is estimated to be required for completion.

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

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

2008 Sales

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

2007 Sales

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

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

4. INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES

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

Liberty Venture I, LP

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

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

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

Kings Hill Unit Trust

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

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

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

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

Liberty/Commerz 1701 JFK Boulevard, LP

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

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

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

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

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

Liberty Illinois, LP

On April 25, 2006, the Company entered into a joint venture (“Liberty Illinois, LP”) with the New York State Common Retirement Fund, selling a 75% equity interest in six industrial properties totaling 2.1 million square feet and 104 acres of developable land. The joint venture valued the buildings and land at $125.0 million.

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

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

Blythe Valley JV Sarl

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

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

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Liberty Washington, LP

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

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

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

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

Other Joint Ventures

As of December 31, 2008, the Company has a 50% ownership interest in three additional unconsolidated joint ventures.  One of these joint ventures has three operating properties and investments in a property under development and land held for development.  For the development project, the Company has guaranteed cost overruns in excess of the approved project budget. The Company considers payments under the guarantee unlikely. One of these joint ventures has one operating property, an investment in land held for development and a leasehold interest.  The other joint venture has a leasehold interest and does not operate or own operating properties.

The Company’s share of each of the joint venture’s earnings is included in equity in earnings (loss) of unconsolidated joint ventures in the accompanying consolidated statements of operations.

The condensed balance sheets as of December 31, 2008 and 2007 and statements of operations for Liberty Venture I, LP, Kings Hill Unit Trust, Liberty Illinois, LP, Blythe Valley JV Sarl, Liberty Washington, LP, Liberty Commerz 1701 JFK Boulevard, LP and other unconsolidated joint ventures for the years ended December 31, 2008, 2007 and 2006 are as follows (in thousands):

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Balance Sheets:

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

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

(1) Differences between the Company’s net investment in unconsolidated joint ventures and its underlying equity in the net assets of the venture is primarily a result of the deferral of gains associated with the sales of properties to joint ventures in which the Company retains an ownership interest and loans made to the joint ventures by the Company. Deferred gains are amortized to equity in earnings (loss) of joint ventures over the average estimated useful lives of the assets sold.

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Statements of Operations:

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

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

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

5. DEFERRED FINANCING AND LEASING COSTS

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

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

6. INDEBTEDNESS

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

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

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

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During the year ended December 31, 2006, the Company satisfied a $100 million 6.95% medium term note and issued a $300 million 5.50% senior unsecured note due December 15, 2016. The Company used the net proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.

The Company is subject to financial covenants contained in some of the debt agreements, the most restrictive of which are detailed below under the heading “Credit Facility.” As of December 31, 2008 the Company was in compliance with all financial covenants.

Mortgage Loans, Unsecured Notes

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

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

Credit Facility

$600 Million Unsecured Revolving Credit Facility

The Company has a four-year, $600 million unsecured revolving credit facility (the “$600 million Credit Facility”). Based on the Company’s present ratings, borrowings under the $600 million Credit Facility are priced at LIBOR plus 65 basis points. The $600 million Credit Facility contains a competitive bid option, whereby participating lenders bid on the interest rate to be charged. This feature is available for up to 50% of the amount of the facility. The interest rate on the $260.0 million of borrowings outstanding as of December 31, 2008 was 1.56%. The current ratings for the Company’s senior unsecured debt are Baa2, BBB, and BBB+ from Moody’s, S&P and Fitch, respectively. The $600 million Credit Facility has an accordion feature for an additional $200 million. There is also a 15 basis point annual facility fee on the current borrowing capacity. The $600 million Credit Facility expires on January 16, 2010 and may be extended for a one-year period. The fee to extend the $600 million Credit Facility for one year is $900,000. The $600 million Credit Facility contains financial covenants, certain of which are set forth below:

• total debt to total assets may not exceed 0.60:1;

• earnings before interest, taxes, depreciation and amortization to fixed charges may not be less than 1.50:1;

• unsecured debt to unencumbered asset value must equal or be less than 60%; and

• unencumbered net operating income to unsecured interest expense must equal or exceed 200%.

The scheduled principal amortization and maturities of the Company’s mortgage loans, unsecured notes outstanding and the $600 million Credit Facility and the related weighted average interest rates are as follows (in thousands, except percentages):

											Weighted
	Mortgages										Average
	Principal		Principal		Unsecured		Credit				Interest
	Amortization		Maturities		Notes		Facility		Total		Rate
2009	$	6,586	$	41,833	$	270,000	$	—	$	318,419		7.76	%
2010		5,823		4,736		176,607		260,000		447,166		4.40	%
2011		5,159		13,409		250,000		—		268,568		7.23	%
2012		4,336		32,875		235,000		—		272,211		6.47	%
2013		3,857		4,510		—		—		8,367		5.79	%
2014		3,888		2,684		200,000		—		206,572		5.66	%
2015		3,336		44,469		300,000		—		347,805		5.25	%
2016		2,409		16,880		300,000		—		319,289		5.55	%
2017		1,770		—		300,000		—		301,770		6.62	%
2018 & thereafter		—		—		100,000		—		100,000		7.50	%
	$	37,164	$	161,396	$	2,131,607	$	260,000	$	2,590,167		6.06	%

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7. LEASING ACTIVITY

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

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

In addition to minimum rental payments, most leases require the tenants to pay for their pro rata share of specified operating expenses. These payments are included as operating expense reimbursement in the accompanying consolidated statements of operations.

8. SHAREHOLDERS’ EQUITY

Common Shares

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

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

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

The Company’s tax return for the year ended December 31, 2008 has not been filed. The taxability information presented for the 2008 distributions is based upon the best available data. The Company’s prior federal income tax returns are subject to examination by taxing authorities. Because the application of tax laws and regulations is susceptible to varying interpretations, the taxability of distributions could be changed at a later date upon final determination by taxing authorities.

Common Shares Held in Treasury

The Company’s Board of Trustees authorized a share repurchase plan under which the Company may purchase up to $100 million of the Company’s Common Shares and preferred shares (as defined below).

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

Minority Interest

Minority interest in the accompanying consolidated financial statements represents the interests of the common and preferred units in Liberty Property Limited Partnership not held by the Trust. Minority interest is adjusted at each period end to reflect the ownership percentage of the common and preferred unitholders at that time. A minority interest reclassification occurs between minority interest and shareholders’ equity each period there is a transaction involving ownership interests in Liberty Property Limited Partnership. In addition, minority interest includes third-party ownership interests in consolidated joint venture investments. During 2006, 684,432 common units were issued in connection with an acquisition. No common units were issued in connection with acquisitions during 2008 or 2007. The common units outstanding as of December 31, 2008 have the same economic characteristics as Common

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Shares of the Trust. The 4,074,967 common units share proportionately in the net income or loss and in any distributions of the Operating Partnership and are exchangeable into the same number of Common Shares of the Trust. The market value of the 4,074,967 common units based on the closing price of the shares of the Company at December 31, 2008 was $93.0 million.

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

The Company has outstanding the following Cumulative Redeemable Preferred Units of the Operating Partnership, (the “Preferred Units”):

Date of						Liquidation		Dividend			Redeemable
Issue	Issue	Amount		Units		Preference		Rate			As of		Exchangeable after
(in 000’s)
7/28/99	Series B	$	95,000		3,800	$	25		7.45	%		8/31/09	1/1/14 into Series B Cumulative Redeemable Preferred Shares of the Trust
6/16/05	Series E	$	20,000		400	$	50		7.00	%		6/16/10	6/16/15 into Series E Cumulative Redeemable Preferred Shares of the Trust
6/30/05	Series F	$	44,000		880	$	50		6.65	%		6/30/10	6/30/15 into Series F Cumulative Redeemable Preferred Shares of the Trust
8/23/05	Series F	$	6,000		120	$	50		6.65	%		6/30/10	6/30/15 into Series F Cumulative Redeemable Preferred Shares of the Trust
12/15/06	Series G	$	27,000		540	$	50		6.70	%		12/12/11	12/12/16 into Series G Cumulative Redeemable Preferred Shares of the Trust
8/21/07	Series H	$	100,000		4,000	$	25		7.40	%		8/21/12	8/21/17 into Series H Cumulative Redeemable Preferred Shares of the Trust

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

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

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

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

Shareholder Rights Plan

In December 1997, the Board of Trustees of the Company adopted a shareholder rights plan (the “Shareholder Rights Plan”). Under the Shareholder Rights Plan, one Right (as defined in the Shareholder Rights Plan) was attached to each outstanding common share at the close of business on December 31, 1997. In addition, a Right was attached to each share of common stock issued after that date. Each Right entitled the registered holder to purchase from the Company, under certain conditions, a unit (a “Rights Plan Unit”) consisting of one one-thousandth of a share of a Series A Junior Participating Preferred Share, $0.0001 par value, (the “Junior Preferred Stock”), of the Company, for $100 per Rights Plan Unit, subject to adjustment. The Rights became exercisable only if a person or group of affiliated or associated persons (an “Acquiring Person”) acquired, or obtained the right to acquire, beneficial ownership of Common Shares or other voting securities (“Voting Stock”) that had 10% or more of the voting power of the outstanding shares of Voting Stock, or if an Acquiring Person commenced to make a tender offer or exchange offer to acquire beneficial ownership of Voting Stock that had 10% or more of the voting power of the outstanding shares of Voting Stock. The Rights were redeemable by the Company at a price of $0.0001 per Right. All Rights expired on December 31, 2007.

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

Dividend Reinvestment and Share Purchase Plan

The Company has a Dividend Reinvestment and Share Purchase Plan under which holders of Common Shares may elect to automatically reinvest their distributions in additional Common Shares and may make optional cash payments for additional Common Shares. The Company may issue additional Common Shares or repurchase Common Shares in the open market for purposes of financing its obligations under the Dividend Reinvestment and Share Purchase Plan. During the years ended December 31, 2008, 2007, and 2006, 1,328,376, 1,366,066, and 1,297,867 Common Shares, respectively, were issued through the Dividend Reinvestment and Share Purchase Plan. The Company used the proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.

9. EMPLOYEE BENEFIT PLANS

The Company maintains a 401(k) plan for the benefit of its full-time employees. The Company matches the employees’ contributions up to 3% of the employees’ salary and may also make annual discretionary contributions. Total 401(k) expense recognized by the Company was $1.4 million, $912,000 and $940,000 for the years ended 2008, 2007 and 2006, respectively.

10. SHARE BASED COMPENSATION

2008 Plan

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

Options

The Company has authorized the grant of options under the share-based employee compensation plan (the “Plan”) and the 2008 Plan to executive officers, other key employees, non-employee trustees and consultants of up to 12.8 million Common Shares of the Company. All options granted have 10-year terms and most options vest and are expensed over a three-year period, with options to purchase up to 20% of the shares exercisable after the first anniversary, up to 50% after the second anniversary and 100% after the third anniversary of the date of grant.

Share based compensation cost related to options for the years ended December 31, 2008, 2007 and 2006 was $1.0 million, $904,000 and $790,000, respectively.

The fair value of share option awards is estimated on the date of the grant using the Black-Scholes option valuation model. The following weighted-average assumptions were utilized in calculating the fair value of options granted during the periods indicated:

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

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

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

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

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

As of December 31, 2008, there was $2.2 million of unrecognized compensation costs related to nonvested options granted under the Plan. That cost is expected to be recognized over a weighted average period of 2.0 years.

Long Term Incentive Shares (“LTI”)

Restricted LTI share grants made under the Plan are valued at the grant date fair value, which is the market price of the underlying Common Shares, and vest ratably over a five-year period beginning with the first anniversary of the grant.

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

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

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

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

The weighted average fair value of restricted shares granted during the years ended December 31, 2008, 2007 and 2006 was $31.04 per share, $49.53 per share and $48.08 per share. As of December 31, 2008, there was $14.0

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million of total unrecognized compensation cost related to nonvested shares granted under the Plan. That cost is expected to be recognized over a weighted average period of 1.9 years. The total fair value of restricted shares vested during the years ended December 31, 2008, 2007 and 2006 was $3.5 million, $2.4 million and $1.9 million, respectively.

Bonus Shares

The Plan provides that employees of the Company may elect to receive bonuses or commissions in the form of Common Shares in lieu of cash (“Bonus Shares”). By making such election, the employee receives shares equal to 120% of the cash value of the bonus or commission, less applicable withholding tax. Bonus Shares issued for the years ended December 31, 2008, 2007 and 2006 were 83,015, 64,755 and 39,207, respectively. Share-based compensation cost related to Bonus Shares for the years ended December 31, 2008, 2007 and 2006 was $2.6 million, $2.9 million and $1.9 million, respectively.

Profit Sharing Plan

The Plan provides that employees of the Company, below the officer level, may receive up to 5% of base pay in the form of Common Shares depending on Company performance. Shares issued in conjunction with the profit sharing plan for the years ended December 31, 2008, 2007 and 2006 were 15,517, 3,457 and 3,072 shares, respectively.

An additional 1,751,912, 2,738,176 and 3,063,169 Common Shares were reserved for issuance for future grants under the Share Incentive Plan at December 31, 2008, 2007, and 2006, respectively.

Employee Share Purchase Plan

The Company registered 750,000 Common Shares under the Securities Act of 1933, as amended, in connection with an employee share purchase plan (“ESPP”). The ESPP enables eligible employees to purchase shares of the Company, in amounts up to 10% of the employee’s salary, at a 15% discount to fair market value. There were 17,618, 13,414 and 10,491 shares issued, in accordance with the ESPP, during the years ended December 31, 2008, 2007 and 2006, respectively.

11. COMMITMENTS AND CONTINGENCIES

Substantially all of the Properties and land were subject to Phase I Environmental Assessments and when appropriate Phase II Environmental Assessments (collectively, the “Environmental Assessments”) obtained in contemplation of their acquisition by the Company. The Environmental Assessments consisted of, among other activities, a visual inspection of each Property and its neighborhood and a check of pertinent public records. The Environmental Assessments did not reveal, nor is the Company aware of, any non-compliance with environmental laws, environmental liability or other environmental claim that the Company believes would likely have a material adverse effect on the Company.

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

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

The Company maintains cash and cash equivalents at financial institutions. The combined account balances at each institution typically exceed FDIC insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes the risk is not significant.

Litigation

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

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

12. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

A summary of quarterly results of operations for the years ended December 31, 2008 and 2007 follows. Certain amounts have been reclassified to conform to the current presentation of discontinued operations (in thousands, except per share amounts).

	Quarter Ended
	Dec. 31,		Sept. 30,		June 30,		Mar. 31,		Dec. 31,		Sept. 30,		June 30,		Mar. 31,
	2008		2008		2008		2008		2007		2007		2007		2007
Operating revenue	$	189,202	$	186,616	$	182,756	$	189,946	$	185,136	$	173,818	$	165,757	$	162,120
Income from continuing operations		41,861		28,111		28,335		28,656		24,758		31,337		33,402		34,277
Discontinued operations		9,937		10,443		3,294		1,305		10,774		5,837		19,025		5,421
Income available to common Shareholders		51,798		38,554		31,629		29,961		35,532		37,174		52,427		39,698
Income per common share — basic (1)		0.53		0.41		0.34		0.33		0.39		0.41		0.57		0.44
Income per common share — diluted (1)		0.53		0.41		0.34		0.33		0.39		0.41		0.57		0.43

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

13. SEGMENT INFORMATION

The Company operates its portfolio of properties primarily throughout the Mid-Atlantic, Southeastern, Midwestern and Southwestern United States. Additionally, the Company owns certain assets in the United Kingdom. The Company reviews the performance of the portfolio on a geographical basis. As such, the following regions are considered the Company’s reportable segments:

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

The Company’s reportable segments are distinct business units which are each managed separately in order to concentrate market knowledge within a geographic area. Within these reportable segments, the Company derives its revenues from its two product types: industrial properties and office properties.

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

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

The Company evaluates performance of the reportable segments based on property level operating income, which is calculated as rental revenue and operating expense reimbursement less rental property expenses and real estate taxes. The accounting policies of the reportable segments are the same as those for the Company on a consolidated basis.

The operating information by segment is as follows (in thousands):

YEAR ENDED DECEMBER 31, 2008

	Northeast
			Lehigh/
	Southeastern		Central		New								phila-		united
	PA		PA		Jersey		Midwest		mid-atlantic		South		delphia		kingdom		total
Operating revenue		$178,507		$99,418		$38,004		$82,964		$142,543		$173,319		$29,426		$4,339		$748,520
Rental property expenses and real estate taxes		57,729		26,978		14,848		31,074		41,652		57,990		7,791		1,044		239,106
Property level operating income		$120,778		$72,440		$23,156		$51,890		$100,891		$115,329		$21,635		$3,295		509,414
Interest and other income																		13,508
Debt extinguishment gain																		2,521
Interest expense																		(155,675)
General and administrative																		(54,378)
Depreciation and amortization																		(173,097)
Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures																		142,293
Gain on property dispositions																		10,572
Income taxes																		(1,645)
Minority interest																		(27,062)
Equity in earnings of unconsolidated joint ventures																		2,805
Discontinued operations, net of minority interest																		24,979
Net income																		$151,942

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YEAR ENDED DECEMBER 31, 2007

	Northeast
	Southeastern		Lehigh/		New				mid-				phila-		united
	PA		Central PA		Jersey		Midwest		atlantic		South		delphia		kingdom		total
Operating revenue		$172,142		$91,631		$36,162		$80,926		$128,599		$150,693		$23,963		$2,715		$686,831
Rental property expenses and real estate taxes		56,950		23,616		9,228		28,061		38,524		50,419		9,378		33		216,209
Property level operating income		$115,192		$68,015		$26,934		$52,865		$90,075		$100,274		$14,585		$2,682		470,622
Interest and other income																		11,727
Interest expense																		(127,058)
General and administrative																		(54,249)
Depreciation and amortization																		(155,616)
Income before property dispositions, income taxes, minority interest and equity in loss of unconsolidated joint ventures																		145,426
Gain on property dispositions																		1,463
Income taxes																		709
Minority interest																		(23,598)
Equity in loss of unconsolidated joint ventures																		(226)
Discontinued operations, net of minority interest																		41,057
Net income																		$164,831

YEAR ENDED DECEMBER 31, 2006

	Northeast
	Southeastern		Lehigh/		New								phila-		united
	PA		Central PA		Jersey		Midwest		mid-atlantic		South		delphia		kingdom		total
Operating revenue		$168,227		$83,849		$34,584		$75,966		$114,593		$113,347		$15,829		$1,167		$607,562
Rental property expenses and real estate taxes		54,181		20,434		8,128		26,752		33,925		36,822		6,913		261		187,416
Property level operating income		$114,046		$63,415		$26,456		$49,214		$80,668		$76,525		$8,916		$906		420,146
Interest and other income																		8,693
Interest expense																		(109,482)
General and administrative																		(46,332)
Depreciation and amortization																		(132,106)
Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures																		140,919
Gain on property dispositions																		17,628
Income taxes																		(288)
Minority interest																		(19,801)
Equity in earnings of unconsolidated joint ventures																		1,432
Discontinued operations, net of minority interest																		126,684
Net income																		$266,574

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	Real Estate Related Revenues
	Year Ended December 31,
Product Type Information	2008		2007		2006
Industrial	$	300,763	$	274,865	$	253,222
Office		447,757		411,966		354,340
Total operating revenue	$	748,520	$	686,831	$	607,562

ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT

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

ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT

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

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

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14. SFAS NO. 144, “ACCOUNTING FOR THE IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS”

Discontinued Operations

In accordance with SFAS No. 144, the operating results and gain/(loss) on disposition of real estate for properties sold and held for sale are reflected in the consolidated statements of operations as discontinued operations. Prior year financial statements have been adjusted for discontinued operations. The proceeds from dispositions of operating properties with no continuing involvement were $80.0 million and $369.5 million for the years ended December 31, 2008 and 2007, respectively.

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

	Year Ended December 31,
	2008			2007			2006
Revenues	$	13,295		$	43,330		$	85,536
Operating expenses		(5,377	)		(17,375	)		(31,202	)
Interest expense		(2,203	)		(6,957	)		(14,764	)
Depreciation and amortization		(3,153	)		(9,671	)		(19,838	)
Income before property dispositions and minority interest	$	2,562		$	9,327		$	19,732

Six properties totaling 296,000 square feet located in the Company’s Mid-Atlantic segment are considered to be held for sale as of December 31, 2008.

Interest expense is allocated to discontinued operations as permitted under EITF Issue 87-24, "Allocation of Interest to Discontinued Operations,” and such interest expense has been included in computing income from discontinued operations. The allocation of interest expense to discontinued operations was based on the ratio of net assets sold (without continuing involvement) to the sum of total net assets plus consolidated debt.

Asset Impairment

In accordance with SFAS No. 144, during the years ended December 31, 2008, 2007 and 2006, the Company recognized impairment losses of $3.1 million, $0.2 million and $4.2 million, respectively. The 2008 impairment loss of $3.1 million was recognized in the fourth quarter and was related to a 49,000 square foot operating property in the Midwest segment, a 110,000 square foot operating property in Southeastern PA and a 296,000 square foot portfolio of operating properties in the Mid-Atlantic segment. The 2007 impairment loss of $0.2 million was related to various land parcels. The 2006 impairment loss of $4.2 million was primarily related to a 352,000 square foot portfolio of operating properties in the Midwest segment. For the years ended December 31, 2008 and 2006, respectively, $3.1 million and $4.2 million in impairment related to properties sold or held for sale were included in the caption discontinued operations in the Company’s statement of operations. For the year ended December 31, 2007, $0.2 million in impairment was included in the caption gain on property dispositions as a component of income from continuing operations. The Company determined these impairments through a comparison of the aggregate future cash flows (including quoted offer prices) to be generated by the properties to the carrying value of the properties. The Company has evaluated each of the properties and land held for development and has determined that there are no additional valuation adjustments necessary at December 31, 2008.

15. SUBSEQUENT EVENTS

In December 2008, the Company commenced the sale of Common Shares pursuant to a continuous offering program. From January 1, 2009 through February 23, 2009, the Company sold 2.3 million common shares through this program. The net proceeds from the offering of $47.4 million were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

In February 2009, the Company closed on mortgages totaling $193.2 million. The mortgages encumber certain of the Company’s Properties in Operation. The net proceeds from these mortgages were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

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

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

71

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

72

								Costs
								Capitalized										Date of
								Subsequent		Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to		Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition		Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
8995 Columbine Road	Eden Prairie, MN		—		1,087,594				3,664,053		2,055,296		2,696,352		4,751,648		595,546	2001	40 yrs.
8911 Columbine Road (B2)	Eden Prairie, MN		—		916,687				3,608,469		1,718,407		2,806,748		4,525,156		535,211	2000	40 yrs.
8855 Columbine Road	Eden Prairie, MN		—		1,400,925				5,226,016		1,599,757		5,027,185		6,626,941		581,470	2000	40 yrs.
7075 Flying Cloud Drive	Eden Prairie, MN		—		10,232,831		10,855,851		53,337		10,243,977		10,898,042		21,142,019		500,941	2007	40 yrs.
7351 Coca Cola Drive	Elkridge, MD		—		1,897,044		—		7,048,446		3,023,417		5,922,074		8,945,491		224,957	2006	40 yrs.
180 Sheree Boulevard	Exton, PA		5,157,523		2,647,861		11,334,403		2,049,934		2,649,426		13,382,772		16,032,198		1,066,878	2007	40 yrs.
7028 Snowdrift Road	Fogelville, PA		—		520,473		959,279		292,813		524,390		1,248,175		1,772,565		371,902	1982	40 yrs.
420 Delaware Drive	Fort Washington, PA		—		2,766,931		—		8,290,888		2,826,994		8,230,825		11,057,819		571,917	2005	40 yrs.
414 Commerce Drive	Fort Washington, PA		—		1,267,194		2,217,460		307,900		1,267,937		2,524,616		3,792,553		231,189	2004	40 yrs.
275 Commerce Drive	Fort Washington, PA		—		1,775,894		2,160,855		7,433,770		1,790,041		9,580,478		11,370,519		142,837	2005	40 yrs.
1250 Virginia Drive	Fort Washington, PA		—		1,639,166		1,928,574		468,379		1,650,703		2,385,416		4,036,119		224,244	2005	40 yrs.
1100 Virginia Drive	Fort Washington, PA		—		22,612,437		—		55,809,125		23,339,943		55,081,619		78,421,562		2,007,575	2006	40 yrs.
1100 Virginia Drive	Fort Washington, PA		—		13,007,509		11,480,744		53,906		13,035,013		11,507,146		24,542,159		915,103	2006	40 yrs.
106 Southchase Boulevard	Fountain Inn, SC		—		201,944		—		5,133,389		684,003		4,651,330		5,335,333		358,667	2005	40 yrs.
9601 Cosner Drive	Fredericksburg, VA		—		475,262		3,917,234		214,221		475,262		4,131,454		4,606,716		1,391,089	1995	40 yrs.
200 W Cypress Creek Road	Ft Lauderdale, FL		—		3,414,989		2,399,738		10,524,649		3,414,989		12,924,387		16,339,376		1,924,698	2003	40 yrs.
5410 - 5430 Northwest 33rd Avenue	Ft. Lauderdale, FL		—		603,776		4,176,238		1,156,270		625,111		5,311,174		5,936,284		1,660,664	1985	40 yrs.
6500 NW 12th Avenue	Ft. Lauderdale, FL		—		7,099		3,046,309		475,723		—		3,529,130		3,529,130		1,143,136	1989	40 yrs.
6600 NW 12th Avenue	Ft. Lauderdale, FL		—		7,102		3,047,462		772,549		—		3,827,114		3,827,114		1,136,170	1989	40 yrs.
4880 Cox Road	Glen Allen, VA		—		743,898		4,499,807		3,058,575		743,898		7,558,382		8,302,280		1,840,837	1995	40 yrs.
5000 Cox Road	Glen Allen, VA		—		770,214		3,685,248		315,413		771,029		3,999,846		4,770,875		1,331,758	1990	40 yrs.
5500 Cox Road	Glen Allen, VA		—		443,485		—		3,546,671		483,263		3,506,893		3,990,156		1,152,858	1999	40 yrs.
4801 Cox Road	Glen Allen, VA		—		1,072,896		—		10,198,472		1,075,620		10,195,748		11,271,368		3,297,151	1998	40 yrs.
4198 Cox Road	Glen Allen, VA		—		670,292		3,839,245		1,241,555		670,292		5,080,800		5,751,092		1,645,466	1984	40 yrs.
4510 Cox Road	Glen Allen, VA		—		1,010,024		7,151,729		1,907,500		1,010,044		9,059,209		10,069,253		3,108,655	1990	40 yrs.
4121 Cox Road	Glen Allen, VA		—		1,083,006		6,035,653		952,101		1,083,006		6,987,754		8,070,760		955,534	2004	40 yrs.
200 Southchase Boulevard	Greenville, SC		—		512,911				6,273,615		515,542		6,270,984		6,786,525		792,280	2003	40 yrs.
45 Brookfield Oaks Drive	Greenville, SC		—		818,114		—		3,549,097		825,529		3,541,682		4,367,212		118,418	2006	40 yrs.
116 Pleasant Ridge Road	Greenville, SC		—		1,547,811		—		13,298,582		3,712,683		11,133,710		14,846,393		131,493	2006	40 yrs.
7 Research Drive	Greenville, SC		—		—		17,091,882		4,405		—		17,096,287		17,096,287		752,159	2007	40 yrs.
1487 South Highway 101	Greer, SC		—		464,237		—		5,136,776		1,301,738		4,299,275		5,601,012		13,817	2007	40 yrs.
1 Enterprise Parkway	Hampton, VA		—		974,675		5,579,869		1,433,088		974,675		7,012,957		7,987,632		2,255,340	1987	40 yrs.
22 Enterprise Parkway	Hampton, VA		—		1,097,368		6,760,778		1,257,471		1,097,368		8,018,248		9,115,617		2,462,312	1990	40 yrs.
5 Manhattan Square	Hampton, VA		—		207,368		—		1,663,695		212,694		1,658,368		1,871,063		543,765	1999	40 yrs.
1317 Executive Boulevard	Hampton, VA		—		1,650,423		—		7,668,631		1,128,829		8,190,225		9,319,054		348,381	2006	40 yrs.
21 Enterprise Parkway	Hampton, VA		—		263,668		8,167,118		382,338		265,719		8,547,405		8,813,124		1,848,003	1999	40 yrs.
521 Butler Farm Road	Hampton, VA		—		750,769		2,911,149		261,271		710,486		3,212,702		3,923,188		464,095	2003	40 yrs.
7317 Parkway Drive	Hanover, MD		—		1,104,359		1,959,671		79,319		1,104,359		2,038,990		3,143,349		570,967	1983	40 yrs.
600 Industrial Drive	Harrisburg, PA		—		7,743,800		—		28,472,202		9,368,557		26,847,444		36,216,001		1,554,062	2005	40 yrs.
500 McCarthy Drive	Harrisburg, PA		—		5,194,872		19,991,436		4,234,765		5,687,013		23,734,060		29,421,073		3,011,485	2005	40 yrs.
4170 Mendenhall Oaks Parkway	High Point , NC		—		143,699		—		2,210,943		373,502		1,981,140		2,354,642		655,531	1999	40 yrs.
4180 Mendenhall Oaks Parkway	High Point , NC		—		121,329		—		1,835,505		315,614		1,641,220		1,956,834		584,926	1999	40 yrs.
4050 Piedmont Parkway	High Point , NC		—		801,902		—		20,721,590		2,042,159		19,481,334		21,523,492		5,353,041	1998	40 yrs.
4523 Green Point Drive	High Point, NC		—		234,564		—		3,109,110		235,698		3,107,976		3,343,674		1,269,229	1988	40 yrs.
4501 Green Point Drive	High Point, NC		—		319,289		—		2,606,925		320,450		2,605,765		2,926,214		1,303,596	1989	40 yrs.
4500 Green Point Drive	High Point, NC		—		230,622		—		2,310,319		231,692		2,309,249		2,540,941		1,196,924	1989	40 yrs.
2427 Penny Road	High Point, NC		—		1,165,664		—		3,476,301		655,240		3,986,724		4,641,965		1,791,684	1990	40 yrs.
4524 Green Point Drive	High Point, NC		—		182,810		—		2,396,132		183,888		2,395,053		2,578,942		1,194,991	1989	40 yrs.
4344 Federal Drive	High Point, NC		—		484,001		—		2,780,986		173,623		3,091,365		3,264,988		1,223,712	1996	40 yrs.
4000 Piedmont Parkway	High Point, NC		—		592,885		4,825,615		929,937		597,368		5,751,069		6,348,438		2,122,813	1989	40 yrs.
4380 Federal Drive	High Point, NC		—		282,996		—		2,204,882		283,368		2,204,510		2,487,878		859,427	1997	40 yrs.
4388 Federal Drive	High Point, NC		—		143,661		—		1,210,692		132,655		1,221,699		1,354,353		492,073	1997	40 yrs.
4160 Mendenhall Oaks Parkway	High Point, NC		—		285,882		—		3,361,383		545,627		3,101,638		3,647,265		1,010,657	1998	40 yrs.
4194 Mendenhall Oaks Parkway	High Point, NC		—		102,372		—		2,619,333		265,991		2,455,714		2,721,705		830,855	1999	40 yrs.
4196 Mendenhall Oaks Parkway	High Point, NC		—		66,731		—		2,510,094		173,889		2,402,936		2,576,825		857,473	1999	40 yrs.
4300 Federal Drive	High Point, NC		—		264,038		—		2,098,260		276,038		2,086,260		2,362,298		472,345	1998	40 yrs.
4135 Mendenall Oaks Parkway	High Point, NC		—		499,500		—		3,498,674		500,980		3,497,193		3,998,174		863,928	2000	40 yrs.
1498 Eagle Hill Drive	High Point, NC		—		94,274		—		5,933,606		791,880		5,235,999		6,027,879		220,175	2005	40 yrs.
4183 Eagle Hill Drive	High Point, NC		—		122,203				3,911,210		526,266		3,507,147		4,033,413		1,389,311	2001	40 yrs.
4189 Eagle Hill Drive	High Point, NC		—		100,106				3,430,006		431,106		3,099,006		3,530,112		888,462	2001	40 yrs.
4020 Meeting Way	High Point, NC		—		94,232				1,682,549		378,101		1,398,680		1,776,781		377,882	2001	40 yrs.
1400 Mendenhall Oaks Parkway	High Point, NC		—		172,320				7,281,025		984,672		6,468,673		7,453,345		1,437,607	2002	40 yrs.
4191 Mendenhall Oaks Parkway	High Point, NC		—		217,943				3,114,814		611,166		2,721,590		3,332,756		587,303	2002	40 yrs.
4015 Meeting Way	High Point, NC		—		510,000		—		2,787,760		511,869		2,785,890		3,297,759		296,429	2003	40 yrs.
4195 Eagle Hill Drive	High Point, NC		—		107,586		—		3,425,118		505,700		3,027,005		3,532,705		307,026	2004	40 yrs.
400 Mendenhall Oaks Parkway	High Point, NC		—		—		—		1,859,604		665,239		1,194,365		1,859,604		80,912	2004	40 yrs.
4475 Premier Drive	High Point, NC		—		748,693		—		5,888,692		1,525,421		5,111,964		6,637,385		86,535	2006	40 yrs.
4328, 4336 Federal Drive	High Point, NC		3,977,231		521,122		—		7,300,519		825,092		6,996,548		7,821,641		3,907,767	1995	40 yrs.
100 Witmer Road	Horsham, PA		—		3,102,784		—		18,701,183		3,764,784		18,039,184		21,803,967		3,510,902	1996	40 yrs.
132 Welsh Road	Horsham, PA		—		1,333,642		—		4,692,880		1,408,041		4,618,480		6,026,521		1,665,412	1998	40 yrs.
300 Welsh Road — Building 3	Horsham, PA		—		180,459		1,441,473		375,923		180,459		1,817,396		1,997,855		664,949	1983	40 yrs.
300 Welsh Road — Building 4	Horsham, PA		—		282,493		2,256,508		1,843,483		282,493		4,099,990		4,382,483		1,340,245	1983	40 yrs.
2 Walnut Grove Drive	Horsham, PA		—		1,281,870		7,767,374		1,961,590		1,265,363		9,745,470		11,010,834		3,415,954	1989	40 yrs.
5 Walnut Grove Drive	Horsham, PA		—		1,065,951		—		10,117,753		1,939,712		9,243,992		11,183,704		2,280,276	2000	40 yrs.
200 Gibraltar Road	Horsham, PA		—		638,513		5,811,323		1,947,714		638,513		7,759,036		8,397,550		2,878,638	1990	40 yrs.
220 Gibraltar Road	Horsham, PA		—		629,944		5,733,228		1,455,917		629,944		7,189,145		7,819,089		2,644,772	1990	40 yrs.

73

								Costs
								Capitalized										Date of
								Subsequent		Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to		Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition		Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
240 Gibraltar Road	Horsham, PA		—		629,944		5,733,234		1,915,620		629,944		7,648,854		8,278,798		2,937,215	1990	40 yrs.
1 Walnut Grove Drive	Horsham, PA		—		1,058,901		5,343,606		1,041,557		1,058,901		6,385,163		7,444,064		2,345,767	1986	40 yrs.
181-187 Gibraltar Road	Horsham, PA		—		360,549		3,259,984		787,154		360,549		4,047,138		4,407,687		1,336,533	1982	40 yrs.
104 Rock Road	Horsham, PA		—		330,111		2,981,669		594,916		330,111		3,576,586		3,906,696		941,454	1974	40 yrs.
123-135 Rock Road	Horsham, PA		—		292,360		2,411,677		2,409,782		393,019		4,720,800		5,113,819		1,162,452	1975	40 yrs.
111-159 Gibraltar Road	Horsham, PA		—		489,032		4,126,151		1,367,375		489,032		5,493,526		5,982,558		1,693,767	1981	40 yrs.
161-175 Gibraltar Road	Horsham, PA		—		294,673		2,663,722		987,299		294,673		3,651,020		3,945,694		1,105,985	1976	40 yrs.
103-109 Gibraltar Road	Horsham, PA		—		270,906		2,448,500		818,872		270,906		3,267,371		3,538,278		1,270,550	1978	40 yrs.
210-223 Witmer Road	Horsham, PA		—		270,282		2,441,276		1,940,611		270,282		4,381,887		4,652,169		1,282,445	1972	40 yrs.
100 Gibraltar Road	Horsham, PA		—		38,729		349,811		9,589		38,729		359,400		398,129		99,409	1975	40 yrs.
101 Gibraltar Road	Horsham, PA		—		651,990		5,888,989		1,561,435		732,552		7,369,862		8,102,414		2,305,103	1977	40 yrs.
506 Prudential Road	Horsham, PA		—		208,140		895,470		723,059		208,140		1,618,529		1,826,669		440,823	1973	40 yrs.
113-123 Rock Road	Horsham, PA		—		351,072		3,171,001		589,814		451,731		3,660,155		4,111,887		1,012,999	1975	40 yrs.
101-111 Rock Road	Horsham, PA		—		350,561		3,166,389		864,263		452,251		3,928,962		4,381,213		1,231,119	1975	40 yrs.
120 Gibraltar Road	Horsham, PA		—		533,142		4,830,515		2,416,512		558,142		7,222,027		7,780,169		1,897,838	1980	40 yrs.
110 Gibraltar Road	Horsham, PA		—		673,041		5,776,369		2,584,619		673,041		8,360,988		9,034,029		2,534,483	1979	40 yrs.
100-107 Lakeside Drive	Horsham, PA		—		239,528		2,163,498		712,712		255,528		2,860,210		3,115,738		976,181	1982	40 yrs.
200-264 Lakeside Drive	Horsham, PA		—		502,705		4,540,597		1,536,610		502,705		6,077,207		6,579,912		1,814,424	1982	40 yrs.
300-309 Lakeside Drive	Horsham, PA		—		369,475		3,338,761		1,842,034		376,475		5,173,795		5,550,270		1,986,944	1982	40 yrs.
400-445 Lakeside Drive	Horsham, PA		—		543,628		4,910,226		2,760,384		583,628		7,630,610		8,214,238		2,476,732	1981	40 yrs.
201 Gibraltar Road	Horsham, PA		—		380,127		3,433,433		1,997,494		380,802		5,430,252		5,811,054		1,627,010	1983	40 yrs.
300 Welsh Road	Horsham, PA		—		696,061		3,339,991		570,429		696,061		3,910,420		4,606,480		1,115,040	1985	40 yrs.
700 Dresher Road	Horsham, PA		—		2,551,777		3,020,638		4,696,950		2,565,140		7,704,225		10,269,365		3,764,912	1987	40 yrs.
680 Blair Mill Road	Horsham, PA		—		3,527,151				17,434,151		4,138,577		16,822,725		20,961,302		3,116,684	2001	40 yrs.
102 Rock Road	Horsham, PA		—		1,110,209		2,301,302		1,133,191		1,114,985		3,429,717		4,544,702		662,819	1985	40 yrs.
335 Commerce Drive	Horsham, PA		—		—		—		8,757,475		182,400		8,575,075		8,757,475		1,064,979	2002	40 yrs.
255 Business Center Drive	Horsham, PA		—		1,154,289		2,007,214		573,608		1,140,597		2,594,513		3,735,111		391,690	2003	40 yrs.
355 Business Center Drive	Horsham, PA		—		483,045		898,798		253,426		471,171		1,164,098		1,635,270		243,111	2003	40 yrs.
455 Business Center Drive	Horsham, PA		—		1,351,011		2,503,449		1,927,940		1,322,317		4,460,083		5,782,400		1,031,964	2003	40 yrs.
555 Business Center Drive	Horsham, PA		—		727,420		1,353,650		194,047		709,967		1,565,151		2,275,118		345,712	2003	40 yrs.
7 Walnut Grove Drive	Horsham, PA		—		2,631,696		—		18,587,588		2,631,956		18,587,328		21,219,284		621,811	2006	40 yrs.
261-283 Gibraltar Road	Horsham, PA		*		464,871		3,951,972		1,775,341		464,871		5,727,312		6,192,183		1,216,076	1978	40 yrs.
231-237 Gibraltar Road	Horsham, PA		*		436,952		3,948,963		727,352		436,952		4,676,314		5,113,267		1,504,124	1981	40 yrs.
104 Witmer Road	Horsham, PA		*		1,248,148		—		1,133,749		189,793		2,192,104		2,381,897		931,792	1975	40 yrs.
719 Dresher Road	Horsham, PA		*		493,426		2,812,067		251,335		495,112		3,061,716		3,556,828		851,187	1987	40 yrs.
4 Walnut Grove	Horsham, PA		*		2,515,115		—		10,792,470		2,515,115		10,792,470		13,307,585		1,870,755	1999	40 yrs.
747 Dresher Road	Horsham, PA		—		1,607,238		—		5,193,398		1,607,977		5,192,658		6,800,636		2,713,953	1988	40 yrs.
507 Prudential Road	Horsham, PA		—		644,900		5,804,100		8,818,780		1,131,380		14,136,400		15,267,780		4,600,504	1988	40 yrs.
767 Electronic Drive	Horsham, PA		*		1,229,685		—		3,430,171		1,241,970		3,417,886		4,659,856		1,742,609	1996	40 yrs.
16445 Air Center Boulevard	Houston, TX		—		363,339		2,509,186		641,300		363,339		3,150,486		3,513,826		1,208,934	1997	40 yrs.
16405 Air Center Boulevard	Houston, TX		—		438,853		3,030,396		438,371		438,853		3,468,766		3,907,619		1,057,848	1997	40 yrs.
16580 Air Center Boulevard	Houston, TX		—		289,000		3,559,857		269,417		289,000		3,829,274		4,118,275		1,055,346	1997	40 yrs.
1755 Trans Central Drive	Houston, TX		—		293,534		3,036,269		190,651		306,147		3,214,306		3,520,453		752,950	1999	40 yrs.
16680 Central Green Boulevard	Houston, TX		—		311,952		—		3,956,813		492,869		3,775,895		4,268,765		83,075	2001	40 yrs.
16605 Air Center Boulevard	Houston, TX		—		298,999				3,770,315		496,186		3,573,128		4,069,314		988,599	2002	40 yrs.
10739 West Little York Road	Houston, TX		—		797,931		5,950,894		321,145		799,560		6,270,410		7,069,970		1,161,015	1999	40 yrs.
10735 West Little York Road	Houston, TX		—		1,110,988		6,351,946		1,711,950		1,135,483		8,039,401		9,174,884		1,159,934	2000	40 yrs.
8801-19 & 8821-49 Fallbrook Drive	Houston, TX		—		2,290,001		15,297,141		1,590,836		2,290,002		16,887,976		19,177,978		2,452,452	2000	40 yrs.
16685 Air Center Boulevard	Houston, TX		—		—		—		2,935,268		414,691		2,520,577		2,935,268		339,028	2004	40 yrs.
8825-8839 N Sam Houston Pkwy	Houston, TX		—		638,453		3,258,815		565,588		638,477		3,824,378		4,462,856		531,488	2004	40 yrs.
8850-8872 Fallbrook Drive	Houston, TX		—		504,317		2,878,351		1,014,679		504,341		3,893,006		4,397,347		563,067	2004	40 yrs.
8802-8824 Fallbrook Drive	Houston, TX		—		1,114,406		6,364,767		2,636,014		2,775,021		7,340,166		10,115,187		1,029,169	2004	40 yrs.
16602 Central Green Boulevard	Houston, TX		—		284,403		—		4,495,522		503,779		4,276,146		4,779,925		356,764	2005	40 yrs.
1646 Rankin Road	Houston, TX		—		329,961		—		4,895,126		592,234		4,632,853		5,225,087		384,256	2005	40 yrs.
8301 Fallbrook Drive	Houston, TX		—		4,515,862		—		23,627,618		5,877,884		22,265,596		28,143,480		334,684	2006	40 yrs.
5200 N. Sam Houston Parkway	Houston, TX		—		1,519,458		7,135,548		2,697,458		1,520,074		9,832,389		11,352,464		332,982	2007	40 yrs.
5250 N. Sam Houston Parkway	Houston, TX		—		2,173,287		8,868,256		1,972,563		2,173,942		10,840,164		13,014,106		306,826	2007	40 yrs.
11201 Greens Crossing Boulevard	Houston, TX		—		1,006,194		5,412,584		2,705,102		1,008,542		8,115,337		9,123,879		229,320	2007	40 yrs.
850 Greens Parkway	Houston, TX		—		2,893,405		11,593,197		2,456,282		2,899,861		14,043,023		16,942,883		340,455	2007	40 yrs.
860 Greens Parkway	Houston, TX		—		1,399,365		6,344,650		1,528,602		1,374,012		7,898,606		9,272,618		193,441	2007	40 yrs.
20 Wright Avenue	Hunt Valley, MD		—		1,205,946		—		9,645,838		1,861,025		8,990,759		10,851,784		2,048,033	2001	40 yrs.
4 North Park Drive	Hunt Valley, MD		—		3,269,948		13,551,370		1,458,110		3,269,948		15,009,480		18,279,428		2,150,558	2003	40 yrs.
6 North Park Drive	Hunt Valley, MD		—		2,077,949		8,770,566		984,562		2,077,949		9,755,128		11,833,077		1,644,000	2003	40 yrs.
10 North Park Drive	Hunt Valley, MD		—		2,211,969		7,816,042		238,720		2,211,969		8,054,762		10,266,731		1,069,482	2003	40 yrs.
307 International Circle	Hunt Valley, MD		—		3,538,319		14,190,832		13,353,055		3,542,881		27,539,324		31,082,206		2,691,105	2004	40 yrs.
309 International Circle	Hunt Valley, MD		—		613,667		2,458,204		700,193		615,096		3,156,968		3,772,064		302,865	2004	40 yrs.
311 International Circle	Hunt Valley, MD		—		313,365		1,281,093		76,921		314,572		1,356,807		1,671,380		108,395	2004	40 yrs.
8775 Baypine Road	Jacksonville, FL		—		906,804		—		10,034,442		913,013		10,028,233		10,941,246		2,358,535	1989	40 yrs.
8665,8667,8669 Baypine Road	Jacksonville, FL		—		966,552		—		5,987,169		974,959		5,978,762		6,953,721		3,075,507	1987	40 yrs.
7970 Bayberry Road	Jacksonville, FL		—		127,520		—		1,391,397		129,979		1,388,938		1,518,917		1,104,987	1978	40 yrs.
7077 Bonneval Road	Jacksonville, FL		—		768,000		5,789,000		3,526,767		774,020		9,309,747		10,083,767		4,201,227	1988	40 yrs.
4190 Belfort Road	Jacksonville, FL		—		821,000		5,866,000		3,356,397		827,420		9,215,977		10,043,397		4,496,680	1986	40 yrs.
7020 AC Skinner Parkway	Jacksonville, FL		—		398,257		—		2,717,001		749,811		2,365,448		3,115,258		1,158,479	1996	40 yrs.
7022 AC Skinner Parkway	Jacksonville, FL		—		706,934		—		3,572,340		853,981		3,425,294		4,279,274		1,510,930	1996	40 yrs.
11777 Central Highway	Jacksonville, FL		—		92,207		429,997		1,275,050		140,426		1,656,828		1,797,254		1,127,183	1985	40 yrs.
4345 Southpoint Parkway	Jacksonville, FL		—		—		—		8,791,159		418,093		8,373,065		8,791,159		2,765,051	1998	40 yrs.

74

								Costs
								Capitalized											Date of
								Subsequent			Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to			Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition			Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
7016 AC Skinner Parkway	Jacksonville, FL		—		597,181		—		2,373,250			602,633		2,367,799		2,970,431		1,140,862	1996	40 yrs.
7018 AC Skinner Parkway	Jacksonville, FL		—		840,996		—		4,694,026			846,461		4,688,561		5,535,022		2,186,102	1997	40 yrs.
7014 AC Skinner Parkway	Jacksonville, FL		—		574,198		—		3,580,008			780,486		3,373,720		4,154,206		1,385,190	1999	40 yrs.
6620 Southpoint Drive	Jacksonville, FL		—		614,602		4,267,477		1,017,166			614,602		5,284,642		5,899,245		1,858,105	1984	40 yrs.
7980 Bayberry Road	Jacksonville, FL		—		330,726		1,338,101		17,776			330,726		1,355,877		1,686,603		394,141	1978	40 yrs.
6600 Southpoint Parkway	Jacksonville, FL		—		998,432		4,055,727		828,152			1,002,704		4,879,607		5,882,311		1,750,059	1986	40 yrs.
6700 Southpoint Parkway	Jacksonville, FL		—		620,719		2,989,746		789,809			624,215		3,776,060		4,400,274		1,563,846	1987	40 yrs.
4801 Executive Park Court - 100	Jacksonville, FL		—		554,993		2,993,277		1,358,664			554,542		4,352,392		4,906,935		1,671,990	1990	40 yrs.
4801 Executive Park Court - 200	Jacksonville, FL		—		370,017		1,995,518		367,780			370,039		2,363,276		2,733,315		759,393	1990	40 yrs.
4810 Executive Park Court	Jacksonville, FL		—		369,694		3,045,639		1,007,513			370,039		4,052,807		4,422,846		1,281,897	1990	40 yrs.
6602 Executive Park Court - 100	Jacksonville, FL		—		388,519		2,095,293		299,475			388,541		2,394,745		2,783,287		790,611	1993	40 yrs.
6602 Executive Park Court - 200	Jacksonville, FL		—		296,014		1,596,347		453,476			296,032		2,049,805		2,345,837		645,669	1993	40 yrs.
6631 Executive Park Court - 100	Jacksonville, FL		—		251,613		1,356,849		525,120			251,627		1,881,955		2,133,582		791,232	1994	40 yrs.
6631 Executive Park Court - 200	Jacksonville, FL		—		406,561		2,195,070		274,915			407,043		2,469,503		2,876,546		817,142	1994	40 yrs.
4815 Executive Park Court - 100	Jacksonville, FL		—		366,317		1,975,393		409,677			366,339		2,385,048		2,751,387		876,448	1995	40 yrs.
4815 Executive Park Court - 200	Jacksonville, FL		—		462,522		2,494,397		512,344			462,549		3,006,713		3,469,263		1,049,949	1995	40 yrs.
4825 Executive Park Court	Jacksonville, FL		—		601,278		3,242,491		287,899			601,401		3,530,267		4,131,668		1,166,422	1996	40 yrs.
4820 Executive Park Court	Jacksonville, FL		—		555,173		2,693,130		777,785			555,213		3,470,875		4,026,088		1,111,648	1997	40 yrs.
6601 Executive Park Circle North	Jacksonville, FL		—		551,250		3,128,361		110,993			551,250		3,239,353		3,790,603		876,571	1992	40 yrs.
4901 Belfort Road	Jacksonville, FL		—		877,964		2,360,742		2,857,775			877,964		5,218,517		6,096,481		2,096,702	1986	40 yrs.
4875 Belfort Road	Jacksonville, FL		—		2,089,347		—		12,746,697			2,287,152		12,548,892		14,836,044		19,127	1998	40 yrs.
4899 Belfort Road	Jacksonville, FL		—		1,299,201		—		8,299,049			1,168,062		8,430,188		9,598,250		2,332,310	2000	40 yrs.
4905 Belfort Street	Jacksonville, FL		—		638,154		—		3,467,521			641,272		3,464,403		4,105,675		1,067,726	2000	40 yrs.
7251 Salisbury Road	Jacksonville, FL		—		—		—		3,567,820			662,559		2,905,261		3,567,820		883,202	2000	40 yrs.
10245 Centurion Parkway North	Jacksonville, FL		—		852,644		3,510,889		1,038,509			853,704		4,548,337		5,402,042		1,287,220	1996	40 yrs.
4887 Belfort Road	Jacksonville, FL		—		1,299,202				8,013,821			1,665,915		7,647,107		9,313,022		2,008,217	2002	40 yrs.
7255 Salisbury Road	Jacksonville, FL		—		392,060				2,975,677			680,766		2,686,971		3,367,737		700,627	2002	40 yrs.
5201 Gate Parkway	Jacksonville, FL		—		3,836,532		—		21,433,694			4,269,346		21,000,880		25,270,226		2,025,647	2005	40 yrs.
3200 Horizon Drive	King of Prussia, PA		—		928,637		—		7,121,324			1,210,137		6,839,824		8,049,961		2,905,022	1996	40 yrs.
440 East Swedesford Road	King of Prussia, PA		—		717,001		4,816,121		3,338,962			717,001		8,155,083		8,872,084		3,226,346	1988	40 yrs.
460 East Swedesford Road	King of Prussia, PA		—		705,317		4,737,487		4,321,549			705,317		9,059,036		9,764,353		2,487,896	1988	40 yrs.
151 South Warner Road	King of Prussia, PA		—		1,218,086		6,937,866		6,630,138			1,186,972		13,599,118		14,786,090		283,014	1980	40 yrs.
3604 Horizon Drive	King of Prussia, PA		—		397,178		—		1,628,625			350,874		1,674,929		2,025,803		750,858	1998	40 yrs.
3606 Horizon Drive	King of Prussia, PA		—		789,409		—		2,125,279			815,855		2,098,833		2,914,688		876,136	1997	40 yrs.
650 Swedesford Road	King of Prussia, PA		—		952,911		6,722,830		9,556,741			952,911		16,279,570		17,232,481		7,018,413	1971	40 yrs.
680 Swedesford Road	King of Prussia, PA		—		952,361		6,722,830		8,367,206			952,361		15,090,036		16,042,397		6,558,527	1971	40 yrs.
3600 Horizon Drive	King of Prussia, PA		—		236,432		1,856,252		784,645			236,432		2,640,897		2,877,328		758,733	1989	40 yrs.
3602 Horizon Drive	King of Prussia, PA		—		217,734		1,759,489		338,288			217,809		2,097,701		2,315,510		677,108	1989	40 yrs.
2700 Horizon Drive	King of Prussia, PA		—		764,370		—		4,242,628			867,815		4,139,183		5,006,998		1,403,069	1998	40 yrs.
2900 Horizon Drive	King of Prussia, PA		—		679,440		—		3,503,074			774,096		3,408,418		4,182,514		1,096,966	1998	40 yrs.
2500 Renaissance Boulevard	King of Prussia, PA		—		509,580		—		2,866,474			592,886		2,783,167		3,376,054		1,104,642	1999	40 yrs.
2300 Renaissance Boulevard	King of Prussia, PA		—		509,580		—		3,042,297			574,152		2,977,725		3,551,877		958,737	1999	40 yrs.
2100 Renaissance Boulevard	King of Prussia, PA		—		1,110,111		—		9,339,057			1,132,519		9,316,649		10,449,169		3,018,221	1999	40 yrs.
3400 Horizon Drive	King of Prussia, PA		—		776,496		3,139,068		1,276,655			776,496		4,415,723		5,192,219		1,336,234	1995	40 yrs.
2301 Renaissance Boulevard	King of Prussia, PA		—		1,645,246		—		30,063,879			4,581,649		27,127,475		31,709,124		6,028,262	2002	40 yrs.
2520 Renaissance Boulevard	King of Prussia, PA		—		1,020,000		—		5,015,045			978,402		5,056,643		6,035,045		2,170,675	1999	40 yrs.
2201 Renaissance Boulevard	King of Prussia, PA		—		—		—		18,888,377			2,413,514		16,474,863		18,888,377		3,917,910	2000	40 yrs.
2540 Renaissance Boulevard	King of Prussia, PA		—		—		—		1,625,497			274,341		1,351,156		1,625,497		439,087	2000	40 yrs.
2560 Renaissance Boulevard	King of Prussia, PA		—		—		—		3,729,254			649,792		3,079,462		3,729,254		983,905	2000	40 yrs.
170 South Warner Road	King of Prussia, PA		—		547,800		3,137,400		3,987,694			458,232		7,214,662		7,672,894		3,544,518	1980	40 yrs.
190 South Warner Road	King of Prussia, PA		—		552,200		3,162,600		1,647,906			461,909		4,900,797		5,362,706		2,466,986	1980	40 yrs.
3500 Horizon Drive	King of Prussia, PA		—		1,204,839		—		2,630,229			1,223,875		2,611,193		3,835,068		827,303	1996	40 yrs.
3000 Horizon Drive	King of Prussia, PA		—		1,191,449		—		2,309,358			946,703		2,554,103		3,500,806		688,183	1997	40 yrs.
3100 Horizon Drive	King of Prussia, PA		*		601,956		—		2,068,047			611,436		2,058,568		2,670,003		842,426	1995	40 yrs.
11425 State Highway 225	LaPorte, TX		—		975,974		3,409,036		8,956			977,542		3,416,424		4,393,966		274,812	2006	40 yrs.
11503 State Highway 225	LaPorte, TX		—		2,561,931		9,779,023		22,961			2,566,047		9,797,868		12,363,915		627,449	2006	40 yrs.
7528 Walker Way	Lehigh Valley, PA		—		893,441		—		5,510,455			779,330		5,624,567		6,403,897		581,674	2004	40 yrs.
8500 Willard Drive	Lehigh, PA		—		6,398,815		—		21,593,357			7,640,417		20,351,755		27,992,172		238,144	2004	40 yrs.
8301 Industrial Boulevard	Lehigh, PA		—		11,249,550		—		44,324,333			11,254,716		44,319,167		55,573,883		3,543,014	2005	40 yrs.
31700 Research Park Drive	Madison Heights, MI		—		373,202		1,824,721		(158,513	)		373,203		1,666,207		2,039,410		474,553	1988	40 yrs.
31811 Sherman Avenue	Madison Heights, MI		—		207,599		1,179,010		(152,186	)		207,599		1,026,824		1,234,423		315,809	1983	40 yrs.
1201 East Whitcomb Avenue	Madison Heights, MI		—		302,567		1,213,232		(167,324	)		302,567		1,045,908		1,348,475		338,473	1980	40 yrs.
1901 Summit Tower Boulevard	Maitland, FL		—		6,078,791		12,348,567		2,270,262			6,083,206		14,614,415		20,697,621		3,698,818	1998	40 yrs.
45-67 Great Valley Parkway	Malvern, PA		—		795,143		—		4,196,561			795,831		4,195,873		4,991,704		2,393,329	1974	40 yrs.
11,15 Great Valley Parkway	Malvern, PA		—		1,837,050		—		15,005,064			1,837,878		15,004,237		16,842,114		10,408,833	1986	40 yrs.
27-43 Great Valley Parkway	Malvern, PA		—		448,775		—		2,545,542			449,447		2,544,870		2,994,317		1,684,414	1977	40 yrs.
1 Country View Road	Malvern, PA		—		400,000		3,600,000		1,004,647			406,421		4,598,226		5,004,647		1,810,575	1982	40 yrs.
200 Chesterfield Parkway	Malvern, PA		—		495,893		2,739,093		649,407			588,384		3,296,009		3,884,393		2,113,705	1989	40 yrs.
50 Morehall Road	Malvern, PA		—		849,576		—		13,051,932			1,337,076		12,564,432		13,901,508		5,256,060	1997	40 yrs.
1 Great Valley Parkway	Malvern, PA		—		419,460		3,792,570		330,704			419,460		4,123,273		4,542,734		1,272,070	1982	40 yrs.
5 Great Valley Parkway	Malvern, PA		—		684,200		6,181,661		1,594,348			684,200		7,776,009		8,460,209		2,367,337	1983	40 yrs.
1001 Cedar Hollow Road	Malvern, PA		—		1,436,814		—		16,097,184			1,676,470		15,857,528		17,533,998		6,046,629	1998	40 yrs.
3 Country View Road	Malvern, PA		—		814,278		—		4,946,433			1,128,881		4,631,830		5,760,711		1,237,565	1998	40 yrs.
425 Technology Drive	Malvern, PA		—		191,114		—		2,112,927			321,473		1,982,568		2,304,041		846,015	1998	40 yrs.
375 Technology Drive	Malvern, PA		—		191,114		—		2,018,620			234,922		1,974,811		2,209,734		812,215	1998	40 yrs.
45 Liberty Boulevard	Malvern, PA		—		4,380,221		—		15,314,868			4,749,748		14,945,341		19,695,089		5,592,198	1999	40 yrs.

75

								Costs
								Capitalized										Date of
								Subsequent		Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to		Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition		Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
100 Chesterfield Parkway	Malvern, PA		—		1,320,625		—		6,714,624		1,451,139		6,584,110		8,035,249		2,703,488	1998	40 yrs.
600 Chesterfield Parkway	Malvern, PA		—		2,013,750		—		8,255,848		2,171,080		8,098,519		10,269,598		2,977,313	1999	40 yrs.
700 Chesterfield Parkway	Malvern, PA		—		2,013,750		—		8,216,674		2,158,337		8,072,087		10,230,424		2,945,440	1999	40 yrs.
18 Great Valley Parkway	Malvern, PA		—		394,036		3,976,221		99,539		397,293		4,072,504		4,469,796		1,029,148	1980	40 yrs.
11 Great Valley Parkway	Malvern, PA		—		496,297		—		3,226,924		708,331		3,014,890		3,723,221		810,169	2001	40 yrs.
40 Liberty Boulevard	Malvern, PA		—		4,241,137		17,737,090		2,182,842		4,241,167		19,919,901		24,161,068		6,188,393	1989	40 yrs.
2 West Liberty Boulevard	Malvern, PA		—		5,405,041		—		11,635,939		5,405,042		11,635,938		17,040,980		1,218,933	2003	40 yrs.
10 Great Valley Parkway	Malvern, PA		—		823,540		1,341,376		315,887		832,244		1,648,558		2,480,802		250,709	2003	40 yrs.
10, 20 Liberty Boulevard	Malvern, PA		—		724,058		—		5,760,414		724,846		5,759,626		6,484,472		2,818,957	1985	40 yrs.
420 Lapp Road	Malvern, PA		—		1,054,418		—		7,140,197		1,055,243		7,139,372		8,194,615		3,580,383	1989	40 yrs.
14 Lee Boulevard	Malvern, PA		—		664,282		—		6,022,257		643,892		6,042,647		6,686,539		3,107,281	1988	40 yrs.
500 Chesterfield Parkway	Malvern, PA		—		472,364		—		3,323,124		519,742		3,275,746		3,795,488		1,804,871	1988	40 yrs.
300-400 Chesterfield Parkway	Malvern, PA		—		937,212		—		5,742,100		1,012,843		5,666,469		6,679,312		2,967,422	1988	40 yrs.
40 Valley Stream Parkway	Malvern, PA		—		322,918		—		3,282,210		325,775		3,279,352		3,605,128		1,678,712	1987	40 yrs.
50 Valley Stream Parkway	Malvern, PA		—		323,971		—		3,204,468		323,792		3,204,647		3,528,439		1,436,712	1987	40 yrs.
20 Valley Stream Parkway	Malvern, PA		—		465,539		—		5,835,528		466,413		5,834,654		6,301,067		3,318,987	1987	40 yrs.
257-275 Great Valley Parkway	Malvern, PA		—		504,611		—		5,192,928		505,458		5,192,081		5,697,539		3,345,868	1983	40 yrs.
300 Technology Drive	Malvern, PA		—		368,626		—		1,344,816		374,497		1,338,945		1,713,442		769,673	1985	40 yrs.
277-293 Great Valley Parkway	Malvern, PA		—		530,729		—		2,452,813		531,534		2,452,008		2,983,542		1,480,904	1984	40 yrs.
311 Technology Drive	Malvern, PA		—		397,131		—		2,911,205		397,948		2,910,388		3,308,336		1,616,977	1984	40 yrs.
7 Great Valley Parkway	Malvern, PA		—		176,435		—		5,105,230		177,317		5,104,349		5,281,665		3,183,485	1985	40 yrs.
55 Valley Stream Parkway	Malvern, PA		—		215,005		—		4,393,160		215,818		4,392,348		4,608,165		2,300,673	1983	40 yrs.
65 Valley Stream Parkway	Malvern, PA		—		381,544		—		7,203,727		382,361		7,202,910		7,585,271		4,415,881	1983	40 yrs.
508 Lapp Road	Malvern, PA		—		331,392		—		2,021,104		332,216		2,020,280		2,352,496		1,333,384	1984	40 yrs.
10 Valley Stream Parkway	Malvern, PA		—		509,075		—		3,142,498		509,899		3,141,674		3,651,573		1,876,084	1984	40 yrs.
333 Phoenixville Pike	Malvern, PA		—		523,530		—		3,109,124		524,230		3,108,424		3,632,654		1,735,696	1985	40 yrs.
30 Great Valley Parkway	Malvern, PA		—		128,126		—		385,634		128,783		384,977		513,760		330,693	1975	40 yrs.
77-123 Great Valley Parkway	Malvern, PA		—		887,664		—		5,989,734		888,359		5,989,039		6,877,398		3,817,572	1978	40 yrs.
205 Great Valley Parkway	Malvern, PA		—		1,368,259		—		10,951,703		1,369,003		10,950,959		12,319,962		7,311,132	1981	40 yrs.
12,14,16 Great Valley Parkway	Malvern, PA		—		130,689		—		1,560,924		128,767		1,562,846		1,691,613		1,010,537	1982	40 yrs.
155 Great Valley Parkway	Malvern, PA		—		625,147		—		2,627,280		626,068		2,626,359		3,252,427		1,682,215	1981	40 yrs.
510 Lapp Road	Malvern, PA		—		356,950		—		926,587		357,751		925,786		1,283,537		615,963	1983	40 yrs.
60 Morehall Road	Malvern, PA		—		865,424		9,285,000		5,003,181		884,974		14,268,631		15,153,605		7,616,738	1989	40 yrs.
5 Country View Road	Malvern, PA		—		785,168		4,678,632		1,056,753		786,235		5,734,318		6,520,553		2,238,508	1985	40 yrs.
75 Great Valley Parkway	Malvern, PA		233,819		143,074		—		888,076		143,811		887,338		1,031,150		639,417	1977	40 yrs.
7550 Meridian Circle	Maple Grove, MN		—		513,250		2,901,906		480,768		513,250		3,382,673		3,895,923		924,902	1989	40 yrs.
701A Route 73 South	Marlton, NJ		—		264,387		3,772,000		4,136,671		271,743		7,901,315		8,173,058		3,869,216	1987	40 yrs.
701C Route 73 South	Marlton, NJ		—		84,949		1,328,000		630,335		96,161		1,947,123		2,043,284		787,244	1987	40 yrs.
400 Lippincott Drive	Marlton, NJ		—		69,402				3,794,883		317,799		3,546,486		3,864,285		1,160,762	1999	40 yrs.
406 Lippincott Drive	Marlton, NJ		—		321,455		1,539,871		1,152,052		327,554		2,685,824		3,013,378		1,208,728	1990	40 yrs.
301 Lippincott Drive	Marlton, NJ		—		1,069,837		4,780,163		1,627,277		1,069,838		6,407,440		7,477,277		2,579,480	1988	40 yrs.
303 Lippincott Drive	Marlton, NJ		—		1,069,837		4,780,163		3,061,402		1,069,838		7,841,565		8,911,402		3,095,840	1988	40 yrs.
901 Route 73	Marlton, NJ		—		334,411		2,733,314		822,958		334,411		3,556,271		3,890,683		1,303,790	1985	40 yrs.
404 Lippincott Drive	Marlton, NJ		—		131,896		—		1,809,487		131,896		1,809,487		1,941,383		732,345	1997	40 yrs.
402 Lippincott Drive	Marlton, NJ		—		131,896		—		2,096,558		131,896		2,096,558		2,228,454		785,592	1997	40 yrs.
75 Brookfield Oaks Drive	Mauldin, SC		—		419,731		—		2,476,356		430,909		2,465,178		2,896,087		276,134	2003	40 yrs.
65 Brookfield Oaks Drive	Mauldin, SC		—		557,174		—		2,745,259		506,318		2,796,116		3,302,434		273,241	2004	40 yrs.
7800 N. 113th Street	Milwaukee, WI		—		1,711,964		6,847,857		417,823		1,711,964		7,265,680		8,977,644		2,144,918	1991	40 yrs.
11950 W. Lake Park Drive	Milwaukee, WI		—		391,813		2,340,118		597,682		394,938		2,934,675		3,329,613		962,505	1986	40 yrs.
11400 W. Lake Park Drive	Milwaukee, WI		—		439,595		2,357,904		352,646		443,101		2,707,044		3,150,145		678,300	1986	40 yrs.
11425 W. Lake Park Drive	Milwaukee, WI		—		382,256		2,350,619		978,198		385,305		3,325,768		3,711,073		1,301,393	1987	40 yrs.
11301 W. Lake Park Drive	Milwaukee, WI		—		614,477		2,626,456		123,888		619,465		2,745,357		3,364,821		679,473	1987	40 yrs.
11900 W. Lake Park Drive	Milwaukee, WI		—		347,853		2,396,887		1,077,279		350,628		3,471,392		3,822,020		1,219,789	1987	40 yrs.
11414 West Park Place	Milwaukee, WI		—		234,443				10,745,623		491,531		10,488,536		10,980,067		3,129,496	2001	40 yrs.
11520 West Calumet Road	Milwaukee, WI		—		341,698		1,527,548		78,494		341,698		1,606,042		1,947,740		372,203	1995	40 yrs.
12100 West Park Place	Milwaukee, WI		—		534,470		3,239,389		572,084		532,370		3,813,573		4,345,943		1,107,320	1984	40 yrs.
11100 West Liberty Drive	Milwaukee, WI		—		1,800,000				7,537,760		1,801,024		7,536,736		9,337,760		1,330,833	2003	40 yrs.
11050 West Liberty Drive	Milwaukee, WI		—		—		—		3,816,745		914,760		2,901,985		3,816,745		175,374	2005	40 yrs.
4700 Nathan Lane North	Minneapolis, MN		—		1,501,308		8,446,083		225,056		1,501,308		8,671,139		10,172,447		2,049,711	1996	40 yrs.
4600 Nathan Lane	Minneapolis, MN		—		1,063,558				6,683,083		1,038,197		6,708,444		7,746,641		2,184,719	2002	40 yrs.
12501 & 12701 Whitewater Drive	Minnegonka, MN		—		2,175,209		3,948,085		7,480,997		2,177,953		11,426,338		13,604,291		1,523,808	1986	40 yrs.
5600 & 5610 Rowland Road	Minnetonka, MN		—		828,650		7,399,409		2,154,498		829,263		9,553,293		10,382,557		3,528,882	1988	40 yrs.
5400-5500 Feltl Road	Minnetonka, MN		—		883,895		7,983,345		2,288,449		883,895		10,271,794		11,155,689		3,272,429	1985	40 yrs.
3400 Lakeside Drive	Miramar, FL		—		2,022,153		11,345,881		1,661,289		2,022,153		13,007,169		15,029,323		3,866,622	1990	40 yrs.
3450 Lakeside Drive	Miramar, FL		—		2,022,152		11,357,143		2,623,700		2,022,152		13,980,843		16,002,994		4,453,379	1990	40 yrs.
3350 SW 148th Avenue	Miramar, FL		—		2,960,511		—		19,988,526		2,980,689		19,968,347		22,949,037		5,995,017	2000	40 yrs.
324 Park Knoll Drive	Morrisville, NC		*		1,449,092		4,424,932		239,301		1,449,450		4,663,875		6,113,325		221,707	2007	40 yrs.
619 Distribution Drive	Morrisville, NC		*		1,031,430		5,655,167		406,756		1,031,685		6,061,668		7,093,353		273,517	2007	40 yrs.
627 Distribution Drive	Morrisville, NC		*		1,061,370		5,152,110		231,852		1,061,632		5,383,700		6,445,332		226,746	2007	40 yrs.
701 Distribution Drive	Morrisville, NC		*		1,300,889		5,313,226		206,727		1,301,211		5,519,632		6,820,842		230,736	2007	40 yrs.
330 Fellowship Road	Mount Laurel, NJ		—		3,730,570		—		15,782,675		3,758,270		15,754,975		19,513,245		118,386	2006	40 yrs.
300 Fellowship Road	Mt Laurel, NJ		—		—		—		7,350,519		1,098,904		6,251,616		7,350,519		838,722	2004	40 yrs.
302 Fellowship Road	Mt Laurel, NJ		—		1,512,120		—		2,931,388		539,060		3,904,448		4,443,507		356,761	2001	40 yrs.
3001 Leadenhall Road	Mt Laurel, NJ		—		1,925,719		191,390		10,965,396		1,936,489		11,146,016		13,082,505		1,731,986	2003	40 yrs.
350 Fellowship Road	Mt Laurel, NJ		—		2,960,159		1,449,611		4,555,353		2,970,687		5,994,436		8,965,123		397,053	2006	40 yrs.
4001 Leadenhall Road	Mt. Laurel, NJ		—		3,207,885		391,167		18,894,592		2,784,694		19,708,950		22,493,644		4,148,410	2002	40 yrs.

76

								Costs
								Capitalized										Date of
								Subsequent		Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to		Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition		Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
3000 Atrium Way	Mt. Laurel, NJ		—		500,000		4,500,000		5,049,174		512,018		9,537,156		10,049,174		4,500,007	1987	40 yrs.
11000, 15000 Commerce Parkway	Mt. Laurel, NJ		—		310,585		4,394,900		622,498		311,950		5,016,033		5,327,983		2,405,135	1985	40 yrs.
12000, 14000 Commerce Parkway	Mt. Laurel, NJ		—		361,800		3,285,817		968,639		362,855		4,253,401		4,616,256		1,746,377	1985	40 yrs.
16000, 18000 Commerce Parkway	Mt. Laurel, NJ		—		289,700		2,512,683		1,335,052		290,545		3,846,890		4,137,435		1,379,385	1985	40 yrs.
1300 Route 73 North	Mt. Laurel, NJ		—		449,400		3,074,850		2,152,136		450,558		5,225,828		5,676,386		1,991,748	1988	40 yrs.
6000 Commerce Parkway	Mt. Laurel, NJ		—		234,151		2,022,683		902,135		234,151		2,924,818		3,158,969		1,102,498	1985	40 yrs.
7000 Commerce Parkway	Mt. Laurel, NJ		—		260,014		2,236,684		428,261		260,014		2,664,945		2,924,959		947,137	1984	40 yrs.
8000 Commerce Parkway	Mt. Laurel, NJ		—		234,814		1,995,098		468,864		234,814		2,463,962		2,698,776		726,982	1983	40 yrs.
9000 Commerce Parkway	Mt. Laurel, NJ		—		286,587		2,474,820		999,069		286,587		3,473,888		3,760,476		1,235,450	1983	40 yrs.
1000 Briggs Road	Mt. Laurel, NJ		—		288,577		2,546,537		1,481,895		288,577		4,028,432		4,317,009		1,762,710	1986	40 yrs.
1020 Briggs Road	Mt. Laurel, NJ		—		494,334		—		3,166,630		569,184		3,091,781		3,660,964		1,022,257	1999	40 yrs.
2000 Crawford Place	Mt. Laurel, NJ		—		310,831		2,797,744		2,918,905		310,831		5,716,649		6,027,480		2,538,858	1986	40 yrs.
5000 Dearborn Court	Mt. Laurel, NJ		—		1,057,763		4,191,827		1,651,610		1,057,763		5,843,437		6,901,200		1,628,440	1988	40 yrs.
1001 Briggs Road	Mt. Laurel, NJ		—		701,705		3,505,652		2,139,294		701,705		5,644,946		6,346,652		2,407,293	1986	40 yrs.
1015 Briggs Road	Mt. Laurel, NJ		—		356,987		—		3,673,175		470,659		3,559,503		4,030,162		1,075,140	2000	40 yrs.
17000 Commerce Parkway	Mt. Laurel, NJ		—		144,515				3,457,069		144,515		3,457,069		3,601,584		962,620	2001	40 yrs.
1025 Briggs Road	Mt. Laurel, NJ		278,931		430,990		3,714,828		1,234,492		430,990		4,949,320		5,380,310		1,830,207	1987	40 yrs.
6 Terry Drive	Newtown, PA		—		622,029		2,228,851		1,023,137		622,205		3,251,811		3,874,016		1,175,053	1981	40 yrs.
550-590 Hale Avenue	Oakdale, MN		—		765,535		3,488,754		666,032		766,390		4,153,931		4,920,320		1,174,506	1996	40 yrs.
1879 Lamont Avenue	Odenton, MD		—		1,976,000		8,099,579		2,469,160		2,011,030		10,533,709		12,544,739		1,157,212	2004	40 yrs.
350 Winmeyer Avenue	Odenton, MD		—		1,778,400		7,289,165		1,867,935		1,809,927		9,125,573		10,935,500		958,092	2004	40 yrs.
9600 Satellite Boulevard	Orlando, FL		—		252,850		1,297,923		62,116		252,850		1,360,039		1,612,889		410,096	1989	40 yrs.
9700 Satellite Boulevard	Orlando, FL		—		405,362		1,146,546		350,999		405,362		1,497,545		1,902,907		472,552	1989	40 yrs.
1902 Cypress Lake Drive	Orlando, FL		—		523,512		3,191,790		1,027,641		538,512		4,204,431		4,742,943		1,349,433	1989	40 yrs.
9550 Satellite Boulevard	Orlando, FL		—		574,831		—		2,330,526		587,319		2,318,038		2,905,357		716,478	1999	40 yrs.
10511 & 10611 Satellite Boulevard	Orlando, FL		—		517,554		2,568,186		487,613		522,991		3,050,362		3,573,353		1,013,101	1985	40 yrs.
1400-1440 Central Florida Parkway	Orlando, FL		—		518,043		2,561,938		862,155		518,043		3,424,093		3,942,136		918,802	1962	40 yrs.
2216 Directors Row	Orlando, FL		—		453,918		2,572,202		30,979		453,918		2,603,181		3,057,099		686,270	1998	40 yrs.
2400 South Lake Orange Drive	Orlando, FL		—		385,964		—		2,409,102		642,427		2,152,639		2,795,066		498,346	2001	40 yrs.
6923 Lee Vista Boulevard	Orlando, FL		—		903,701		—		3,790,657		830,953		3,863,405		4,694,358		218,655	2006	40 yrs.
6501 Lee Vista Boulevard	Orlando, FL		—		903,701				5,560,142		925,671		5,538,172		6,463,843		1,024,755	2001	40 yrs.
2416 Lake Orange Drive	Orlando, FL		—		535,964				3,175,219		704,800		3,006,382		3,711,182		951,877	2002	40 yrs.
10771 Palm Bay Drive	Orlando, FL		—		664,605				2,362,814		685,383		2,342,035		3,027,419		416,722	2001	40 yrs.
10003 Satellite Boulevard	Orlando, FL		—		680,312		2,120,754		1,241,828		680,312		3,362,582		4,042,894		662,327	2003	40 yrs.
1090 Gills Drive	Orlando, FL		—		878,320		2,558,833		1,371,034		878,320		3,929,867		4,808,187		529,509	2003	40 yrs.
2202 Taft-Vineland Road	Orlando, FL		—		—		—		6,631,110		1,283,713		5,347,397		6,631,110		1,072,811	2004	40 yrs.
South Center Land-Phase II	Orlando, FL		—		838,853		—		4,084,539		767,953		4,155,440		4,923,392		298,526	2006	40 yrs.
7315 Kingspointe Parkway	Orlando, FL		—		1,931,697		6,388,203		2,135,046		1,932,004		8,522,943		10,454,946		1,287,196	2004	40 yrs.
2351 Investors Row	Orlando, FL		—		2,261,924		7,496,249		411,516		2,263,211		7,906,478		10,169,689		790,763	2004	40 yrs.
1950 Summit Park Drive	Orlando, FL		—		2,573,700		17,478,646		587,603		2,583,667		18,056,282		20,639,949		1,772,310	2005	40 yrs.
1958 Summit Park Drive	Orlando, FL		—		2,573,961		11,206,937		8,841,420		2,583,216		20,039,102		22,622,318		2,031,969	2005	40 yrs.
6200 Lee Vista Boulevard	Orlando, FL		—		1,423,584		6,399,510		65,322		1,435,301		6,453,115		7,888,416		543,837	2006	40 yrs.
7022 TPC Drive	Orlando, FL		—		1,443,510		6,845,559		572,022		1,457,286		7,403,806		8,861,092		625,097	2006	40 yrs.
7100 TPC Drive	Orlando, FL		—		1,431,489		7,948,341		576,378		1,445,807		8,510,400		9,956,207		576,967	2006	40 yrs.
7101 TPC Drive	Orlando, FL		—		1,553,537		5,301,499		777,653		1,570,863		6,061,826		7,632,689		436,743	2006	40 yrs.
851 Gills Drive	Orlando, FL		—		332,992		—		2,559,105		373,500		2,518,597		2,892,097		28,215	2006	40 yrs.
950 Gills Drive	Orlando, FL		—		443,989		—		2,496,959		464,800		2,476,148		2,940,948		28,432	2006	40 yrs.
1000 Gills Drive	Orlando, FL		—		415,906		—		2,700,326		435,400		2,680,832		3,116,232		36,577	2006	40 yrs.
8751 Skinner Court	Orlando, FL		—		1,009,532		—		5,452,988		1,075,437		5,387,083		6,462,520		50,479	2008	40 yrs.
2256 Taft-Vineland Road	Orlando, FL		—		467,296		—		2,494,666		825,673		2,136,290		2,961,963		237,098	2005	40 yrs.
8801 Tinicum Boulevard	Philadelphia, PA		—		2,474,031		—		43,598,952		125,087		45,947,896		46,072,983		15,252,548	1997	40 yrs.
3 Franklin Plaza	Philadelphia, PA		—		2,483,144		—		32,150,134		2,514,519		32,118,759		34,633,278		7,807,092	1999	40 yrs.
4751 League Island Boulevard	Philadelphia, PA		—		992,965		331,924		6,753,197		1,022,081		7,056,006		8,078,087		989,840	2003	40 yrs.
1 Crescent Drive	Philadelphia, PA		—		567,280		—		14,379,278		347,892		14,598,666		14,946,558		917,104	2004	40 yrs.
4775 League Island Boulevard	Philadelphia, PA		—		891,892		—		5,757,514		366,982		6,282,425		6,649,406		176,510	2006	40 yrs.
4410 E. Cotton Center Boulevard	Phoenix, AZ		—		4,758,484		10,559,563		4,222,270		4,765,172		14,775,144		19,540,317		224,278	2007	40 yrs.
4750 S. 44th Place	Phoenix, AZ		—		3,756,307		8,336,400		3,624,432		3,761,587		11,955,552		15,717,139		175,068	2007	40 yrs.
4435 E. Cotton Center Boulevard	Phoenix, AZ		—		1,910,584		1,954,020		2,167,338		1,911,045		4,120,898		6,031,943		127,251	2007	40 yrs.
4207 E. Cotton Center Boulevard	Phoenix, AZ		—		1,409,908		4,680,808		1,096,836		1,410,248		5,777,305		7,187,552		415,229	2007	40 yrs.
4217 E. Cotton Center Boulevard	Phoenix, AZ		—		4,831,925		10,045,599		2,015,623		4,833,088		12,060,059		16,893,147		598,710	2007	40 yrs.
4425 E. Cotton Center Boulvard	Phoenix, AZ		*		7,318,457		24,549,401		28,556		7,318,457		24,577,957		31,896,413		1,212,322	2007	40 yrs.
4415 E. Cotton Center Boulevard	Phoenix, AZ		*		1,749,957		3,767,213		6,137		1,749,957		3,773,350		5,523,308		260,492	2007	40 yrs.
4405 E. Cotton Center Boulevard	Phoenix, AZ		*		2,646,318		9,697,439		9,441		2,646,318		9,706,880		12,353,198		442,023	2007	40 yrs.
4313 E. Cotton Center Boulevard	Phoenix, AZ		*		3,895,539		16,724,283		1,399,749		3,895,539		18,124,032		22,019,571		913,104	2007	40 yrs.
4303 E. Cotton Center Boulvard	Phoenix, AZ		*		2,619,964		9,675,711		11,076		2,619,964		9,686,787		12,306,751		485,652	2007	40 yrs.
9801 80th Avenue	Pleasant Prairie, WI		—		1,692,077		7,934,794		337,495		1,689,726		8,274,640		9,964,366		2,019,026	1994	40 yrs.
2250 Hickory Road	Plymouth Meeting, PA		—		1,015,851		9,175,555		2,985,528		1,032,507		12,144,428		13,176,935		3,779,952	1985	40 yrs.
2905 Northwest Boulevard	Plymouth, MN		—		516,920		4,646,342		1,932,535		516,920		6,578,877		7,095,797		2,540,236	1983	40 yrs.
2800 Campus Drive	Plymouth, MN		—		395,366		3,554,512		1,165,443		395,366		4,719,955		5,115,321		1,724,869	1985	40 yrs.
2955 Xenium Lane	Plymouth, MN		—		151,238		1,370,140		508,272		151,238		1,878,412		2,029,650		739,900	1985	40 yrs.
2920 Northwest Boulevard	Plymouth, MN		—		392,026		3,433,678		661,796		384,235		4,103,265		4,487,500		1,329,439	1997	40 yrs.
14630-14650 28th Avenue North	Plymouth, MN		—		198,205		1,793,422		782,928		198,205		2,576,350		2,774,555		890,678	1978	40 yrs.
2800 Northwest Boulevard	Plymouth, MN		—		1,934,438		10,952,503		536,220		1,934,438		11,488,723		13,423,161		3,263,618	1995	40 yrs.
9600 54th Avenue	Plymouth, MN		—		332,317		3,077,820		1,020,792		332,317		4,098,612		4,430,929		1,432,032	1998	40 yrs.
1500 SW 5th Court	Pompano Beach, FL		—		972,232		3,892,085		404,585		972,232		4,296,671		5,268,902		1,230,523	1957	40 yrs.
1651 SW 5th Court	Pompano Beach, FL		—		203,247		811,093		129,136		203,247		940,230		1,143,477		336,929	1990	40 yrs.

77

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

78

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

79

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

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

80

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

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

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

81

SCHEDULE III

LIBERTY PROPERTY TRUST
REAL ESTATE AND ACCUMULATED DEPRECIATION
(In thousands)

A summary of activity for real estate and accumulated depreciation is as follows:

	Year Ended December 31,
	2008			2007			2006
REAL ESTATE:
Balance at beginning of year	$	5,765,409			$5,101,280		$	4,649,302
Additions		330,371			939,322			820,012
Disposition of property		(567,248	)		(275,193	)		(368,034	)
Balance at end of year	$	5,528,532		$	5,765,409		$	5,101,280
ACCUMULATED DEPRECIATION:
Balance at beginning of year	$	858,671		$	782,750		$	712,786
Depreciation expense		140,925			126,852			120,947
Disposition of property		(17,482	)		(50,931	)		(50,983	)
Balance at end of year	$	982,114		$	858,671		$	782,750

82

Management’s Annual Report on Internal Control Over Financial Reporting

To the Partners of Liberty Property Limited Partnership:

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15 (f) and 15d-15(f). The Company’s internal control system was designed to provide reasonable assurance to the Company’s management regarding the preparation and fair presentation of published financial statements.

Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2008. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commissions (COSO) in Internal Control — Integrated Framework. Based on our assessment we believe that, as of December 31, 2008, the Company’s internal control over financial reporting is effective based on those criteria.

The Company’s independent registered public accounting firm, Ernst & Young LLP, has issued an attestation report on the Company’s internal controls over financial reporting, which is included in this Annual Report on Form 10-K.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

February 27, 2009

83

Report of Independent Registered Public Accounting Firm

The Partners of Liberty Property Limited Partnership

We have audited Liberty Property Limited Partnership’s (the “Operating Partnership”) internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control–Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). The Operating Partnership’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Operating Partnership’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Liberty Property Limited Partnership maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets as of December 31, 2008 and 2007, and the related consolidated statements of operations, owners’ equity, and cash flows for each of the three years in the period ended December 31, 2008 of Liberty Property Limited Partnership and our report dated February 25, 2009 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania
February 25, 2009

84

Report of Independent Registered Public Accounting Firm

The Partners of Liberty Property Limited Partnership

We have audited the accompanying consolidated balance sheets of Liberty Property Limited Partnership (the “Operating Partnership”) as of December 31, 2008 and 2007, and the related consolidated statements of operations, owners’ equity, and cash flows for each of the three years in the period ended December 31, 2008. Our audits also included the financial statement schedule listed in the Index at Item 15. These financial statements and schedule are the responsibility of the Operating Partnership’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

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

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

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Liberty Property Limited Partnership’s internal control over financial reporting as of December 31, 2008, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 25, 2009 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania
February 25, 2009

85

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

	December 31,
	2008			2007
ASSETS
Real estate:
Land and land improvements	$	813,397		$	792,991
Buildings and improvements		4,260,121			4,408,309
Less accumulated depreciation		(982,114	)		(858,671	)
Operating real estate		4,091,404			4,342,629
Development in progress		245,463			316,985
Land held for development		209,551			247,124
Net real estate		4,546,418			4,906,738
Cash and cash equivalents		15,794			37,989
Restricted cash		39,726			34,567
Accounts receivable, net		12,985			15,908
Deferred rent receivable		85,352			79,720
Deferred financing and leasing costs, net		134,029			144,295
Investments in and advances to unconsolidated joint ventures		266,602			278,383
Assets held for sale		33,662			36,908
Prepaid expenses and other assets		82,467			109,429
Total assets	$	5,217,035		$	5,643,937
LIABILITIES
Mortgage loans	$	198,560		$	243,169
Unsecured notes		2,131,607			2,155,000
Credit facility		260,000			622,960
Accounts payable		32,481			44,666
Accrued interest		36,474			39,725
Distributions payable		48,858			59,849
Other liabilities		182,549			268,926
Total liabilities		2,890,529			3,434,295
Minority interest		1,130			517
OWNERS’ EQUITY
General partner’s equity — common units		1,956,735			1,837,021
Limited partners’ equity — preferred units		287,959			287,960
— common units		80,682			84,144
Total owners’ equity		2,325,376			2,209,125
Total liabilities and owners’ equity	$	5,217,035		$	5,643,937

See accompanying notes.

86

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

	Year Ended December 31,
	2008			2007			2006
OPERATING REVENUE
Rental	$	520,301		$	480,107		$	426,874
Operating expense reimbursement		228,219			206,724			180,688
Total operating revenue		748,520			686,831			607,562
OPERATING EXPENSES
Rental property		152,786			143,646			122,826
Real estate taxes		86,320			72,563			64,590
General and administrative		54,378			54,249			46,332
Depreciation and amortization		173,097			155,616			132,106
Total operating expenses		466,581			426,074			365,854
Operating income		281,939			260,757			241,708
OTHER INCOME (EXPENSE)
Interest and other income		13,508			11,727			8,693
Debt extinguishment gain		2,521			—			—
Interest expense		(155,675	)		(127,058	)		(109,482	)
Total other income(expense)		(139,646	)		(115,331	)		(100,789	)
Income before property dispositions, income taxes, minority interest and equity in (loss) earnings of unconsolidated joint ventures		142,293			145,426			140,919
Gain on property dispositions		10,572			1,463			17,628
Income taxes		(1,645	)		709			(288	)
Minority interest		(483	)		(101	)		7
Equity in earnings (loss) of unconsolidated joint ventures		2,805			(226	)		1,432
Income from continuing operations		153,542			147,271			159,698
Discontinued operations (including net gain on property dispositions of $23,519, $33,611 and $112,620 for the years ended December 31, 2008, 2007 and 2006, respectively)		26,081			42,938			132,352
Net income		179,623			190,209			292,050
Preferred unit distributions		21,012			17,126			13,691
Excess of preferred unit redemption over carrying amount		—			696			—
Income available to common unitholders	$	158,611		$	172,387		$	278,359
Earnings per common unit
Basic:
Income from continuing operations	$	1.35		$	1.36		$	1.56
Income from discontinued operations		0.27			0.45			1.42
Income per common unit — basic	$	1.62		$	1.81		$	2.98
Diluted:
Income from continuing operations	$	1.35		$	1.35		$	1.55
Income from discontinued operations		0.27			0.45			1.40
Income per common unit — diluted	$	1.62		$	1.80		$	2.95
Weighted average number of common units outstanding
Basic		97,814			95,375			93,208
Diluted		97,994			95,993			94,387

See accompanying notes.

87

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

	General			Limited			Total
	Partner’s			Partners’			Owners’
	Equity			Equity			Equity
Balance at January 1, 2006	$	1,709,182		$	252,726		$	1,961,908
Contributions from partners		107,338			(14,067	)		93,271
Distributions to partners		(221,907	)		(23,129	)		(245,036	)
Issuance of operating partnership units		—			56,302			56,302
Foreign currency translation adjustment		10,417			—			10,417
Net income		266,574			25,476			292,050
Balance at December 31, 2006		1,871,604			297,308			2,168,912
Contributions from partners		77,740			753			78,493
Distributions to partners		(278,209	)		(27,640	)		(305,849	)
Issuance of operating partnership units		—			99,958			99,958
Redemption of operating partnership units		—			(23,653	)		(23,653	)
Foreign currency translation adjustment		1,055			—			1,055
Net income		164,831			25,378			190,209
Balance at December 31, 2007		1,837,021			372,104			2,209,125
Contributions from partners		215,551			—			215,551
Distributions to partners		(221,023	)		(31,144	)		(252,167	)
Foreign currency translation adjustment		(26,756	)		—			(26,756	)
Net income		151,942			27,681			179,623
Balance at December 31, 2008	$	1,956,735		$	368,641		$	2,325,376

See accompanying notes.

88

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

	Year Ended December 31,
	2008			2007			2006
OPERATING ACTIVITIES
Net income	$	179,623		$	190,209		$	292,050
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		175,236			163,665			151,966
Amortization of deferred financing costs		4,429			4,137			4,244
Equity in loss (earnings) of unconsolidated joint ventures		(2,805	)		226			(1,432	)
Distributions from unconsolidated joint ventures		1,660			3,550			5,692
Minority interest in net income		483			101			(7	)
Gain on property dispositions		(34,091	)		(35,074	)		(130,248	)
Noncash compensation		9,152			8,128			6,212
Changes in operating assets and liabilities:
Restricted cash		(10,903	)		26,211			(21,692	)
Accounts receivable		(4,277	)		4,634			(6,879	)
Deferred rent receivable		(13,482	)		(13,455	)		924
Prepaid expenses and other assets		(26,326	)		(14,145	)		(14,394	)
Accounts payable		(10,913	)		3,974			7,648
Accrued interest		(3,251	)		3,428			1,405
Other liabilities		3,935			1,163			29,084
Net cash provided by operating activities		268,470			346,752			324,573
INVESTING ACTIVITIES
Investment in properties		(60,078	)		(307,846	)		(372,610	)
Cash paid for business, net of cash acquired		—			(626,007	)		—
Investments in and advances to unconsolidated joint ventures		58,250			(227,385	)		(6,239	)
Net proceeds from disposition of properties/land		382,956			996,474			492,548
Investment in development in progress		(247,393	)		(417,877	)		(339,631	)
Increase in land held for development		(47,857	)		(137,051	)		(79,976	)
Increase in deferred leasing costs		(33,325	)		(39,232	)		(29,034	)
Net cash provided by (used in) investing activities		52,553			(758,924	)		(334,942	)
FINANCING ACTIVITIES
Net proceeds from issuance of notes payable		—			415,063			—
Redemption of notes payable		—			(415,063	)		—
Net proceeds from issuance of unsecured notes		—			446,205			295,393
Repayment of unsecured notes		(23,393	)		(250,000	)		(100,000	)
Proceeds from mortgage loans		2,667			—			—
Repayments of mortgage loans		(46,452	)		(16,365	)		(56,406	)
Proceeds from credit facility		572,300			1,363,050			725,025
Repayments on credit facility		(782,300	)		(987,050	)		(733,515	)
Increase in deferred financing costs		(33	)		(1,224	)		(1,635	)
Capital contributions		206,349			170,313			113,348
Distributions to partners		(262,973	)		(328,607	)		(242,537	)
Net cash (used in) provided by financing activities		(333,835	)		396,322			(327	)
Decrease in cash and cash equivalents		(12,812	)		(15,850	)		(10,696	)
(Decrease) increase in cash and cash equivalents related to foreign currency translation		(9,383	)		102			2,804
Cash and cash equivalents at beginning of year		37,989			53,737			61,629
Cash and cash equivalents at end of year	$	15,794		$	37,989		$	53,737
SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS
Write-off of fully depreciated property and deferred costs	$	31,421		$	102,902		$	87,424
Issuance of operating partnership common units		—			—			30,000
Acquisition of properties		—			(73,556	)		(3,066	)
Assumption of mortgage loans		—			73,556			3,066

See accompanying notes.

89

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP

1. ORGANIZATION

Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (a “REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the “Operating Partnership” and, together with the Trust and their consolidated subsidiaries, the “Company”). The Trust is the sole general partner and also a limited partner of the Operating Partnership, owning 96.0% of the common equity of the Operating Partnership at December 31, 2008. The Company provides leasing, property management, development, acquisition, and other tenant-related services for a portfolio of industrial and office properties which are located principally within the Mid-Atlantic, Southeastern, Midwestern and Southwestern United States and the United Kingdom.

All square footage amounts are unaudited.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“US GAAP”) requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Principles of Consolidation

The consolidated financial statements of the Company include the Operating Partnership and wholly owned subsidiaries and those subsidiaries in which the Company owns a majority voting interest with the ability to control operations of the subsidiaries and where no approval, veto or other important rights have been granted to the minority shareholders. All significant intercompany transactions and accounts have been eliminated.

Reclassifications

Certain amounts from prior years have been reclassified to conform to current-year presentation.

Real Estate and Depreciation

The properties are recorded at cost and are depreciated using the straight line method over their estimated useful lives. The estimated lives are as follows:

Building and Improvements	40 years (blended)
Capital improvements	15 — 20 years
Equipment	5 — 10 years
Tenant improvements	Term of the related lease

Expenditures directly related to acquisition or improvement of real estate, including interest and other costs capitalized during development, are included in net real estate and are stated at cost. The capitalized costs include pre-construction costs essential to the development of the property, development and construction costs, interest costs, real estate taxes, development-related salaries and other costs incurred during the period of development. Expenditures for maintenance and repairs are charged to operations as incurred.

In accordance with the Financial Accounting Standards Board (“FASB”) Statement of Financial Standards (“SFAS”) No. 141, “Business Combinations,” the Company allocates the purchase price of real estate acquired to land, building and improvements and intangibles based on the relative fair value of each component. The value ascribed to in-place leases is based on the rental rates for the existing leases compared to market rent for leases of similar terms and present valuing the difference based on market interest rates. Origination values are also assigned to in-place leases, and, where appropriate, value is assigned to customer relationships. The Company depreciates the amounts allocated to building and improvements over 40 years and the amounts allocated to intangibles relating to in-place leases, which are included in deferred financing and leasing costs and other liabilities in the accompanying consolidated balance sheets, over the remaining term of the related leases.

Once a property is designated as held for sale, no further depreciation expense is recorded. Operations for properties identified as held for sale and/or sold where no continuing involvement exists are presented in discontinued operations for all periods presented.

90

The Company evaluates its real estate investments upon occurrence of a significant adverse change in its operations to assess whether any impairment indicators are present that affect the recovery of the recorded value. If any real estate investment is considered impaired, a loss is recognized to reduce the carrying value of the property to its estimated fair value.

Investments in Unconsolidated Joint Ventures

The Company accounts for its investments in unconsolidated joint ventures using the equity method of accounting as the Company exercises significant influence, but does not control these entities. Under the equity method of accounting, the net equity investment of the Company is reflected in the accompanying consolidated balance sheets and the Company’s share of net income from the joint ventures is included in the accompanying consolidated statements of operations.

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

Cash and Cash Equivalents

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

Restricted Cash

Restricted cash includes tenant security deposits and escrow funds that the Company maintains pursuant to certain mortgage loans. Restricted cash also includes the undistributed proceeds from the sale of residential land in Kent County, United Kingdom.

Accounts Receivable/Deferred Rent Receivable

The Company’s accounts receivable are comprised of rents and charges for property operating costs due from tenants. The Company periodically performs a detailed review of amounts due from tenants to determine if accounts receivable balances are collectible. Based on this review, accounts receivable are reduced by an allowance for doubtful accounts. The Company considers tenant credit quality and payment history and general economic conditions in determining the allowance for doubtful accounts. If the accounts receivable balance is subsequently deemed uncollectible, the receivable and allowance for doubtful account balance is written off.

The Company’s deferred rent receivable represents the cumulative difference between rent revenue recognized on a straight line basis and contractual payments due under the terms of tenant leases.

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

Goodwill

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

Revenues

The Company earns rental income under operating leases with tenants. Rental income is recognized on a straight line basis over the applicable lease term. Operating expense reimbursements consisting of amounts due from tenants for

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real estate taxes, utilities and other recoverable costs are recognized as revenue in the period in which the corresponding expenses are incurred.

Termination fees (included in rental revenue) are fees that the Company has agreed to accept in consideration for permitting certain tenants to terminate their lease prior to the contractual expiration date. The Company recognizes termination fees in accordance with Staff Accounting Bulletin 104 when the following conditions are met:

a)	the termination agreement is executed,
b)	the termination fee is determinable,
c)	all landlord services pursuant to the terminated lease have been rendered, and
d)	collectability of the termination fee is assured.

Deferred Financing and Leasing Costs

Costs incurred in connection with financing or leasing are capitalized and amortized over the term of the related loan or lease. Deferred financing cost amortization is reported as interest expense. Intangible assets related to acquired in-place leases are amortized over the terms of the related leases.

Costs Incurred for Preferred Unit Issuance Costs incurred in connection with the Company’s preferred unit issuances are reflected as a reduction of Limited partner’s equity — preferred units.

Income per Common Unit The following table sets forth the computation of basic and diluted income per common unit (in thousands, except per unit amounts):

	2008							2007
				Weighted							Weighted
				Average							Average
	Income			Units		Per		Income			Units		Per
	(Numerator)			(Denominator)		Unit		(Numerator)			(Denominator)		Unit
Income from continuing operations	$	153,542						$	147,271
Less: Preferred unit distributions		(21,012	)						(17,126	)
Excess of preferred unit redemption over carrying amount		—							(696	)
Basic income from continuing operations
Income from continuing operations available to common unitholders		132,530			97,814	$	1.35		129,449			95,375	$	1.36
Dilutive units for long-term compensation plans		—			180				—			618
Diluted income from continuing operations
Income from continuing operations available to common unitholders and assumed conversions		132,530			97,994	$	1.35		129,449			95,993	$	1.35
Basic income from discontinued operations
Discontinued operations		26,081			97,814	$	0.27		42,938			95,375	$	0.45
Dilutive units for long-term compensation plans		—			180				—			618
Diluted income from discontinued operations
Discontinued operations		26,081			97,994	$	0.27		42,938			95,993	$	0.45
Basic income per common unit
Income available to common unitholders		158,611			97,814	$	1.62		172,387			95,375	$	1.81
Dilutive units for long-term compensation plans		—			180				—			618
Diluted income per common unit
Income available to common unitholders and assumed conversions	$	158,611			97,994	$	1.62	$	172,387			95,993	$	1.80

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	2006
				Weighted
				Average
	Income			Units		Per
	(Numerator)			(Denominator)		Unit
Income from continuing operations	$	159,698
Less: Preferred unit distributions		(13,691	)
Basic income from continuing operations
Income from continuing operations available to common unitholders		146,007			93,208	$	1.56
Dilutive units for long-term compensation plans		—			1,179
Diluted income from continuing operations
Income from continuing operations available to common unitholders and assumed conversions		146,007			94,387	$	1.55
Basic income from discontinued operations
Discontinued operations		132,352			93,208	$	1.42
Dilutive units for long-term compensation plans		—			1,179
Diluted income from discontinued operations
Discontinued operations		132,352			94,387	$	1.40
Basic income per common unit
Income available to common unitholders		278,359			93,208	$	2.98
Dilutive units for long-term compensation plans		—			1,179
Diluted income per common unit
Income available to common unitholders and assumed Conversions	$	278,359			94,387	$	2.95

Fair Value of Financial Instruments

The carrying value of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued interest, distributions payable and other liabilities are reasonable estimates of fair values because of the short-term nature of these instruments. The fair value of the Company’s long-term debt, which is based on estimates by management and on rates quoted on December 31, 2008 for comparable loans, is less than the aggregate carrying value by approximately $713.1 million at December 31, 2008.

Income Taxes

In conformity with the Internal Revenue Code and applicable state and local tax statutes, taxable income or loss of the Operating Partnership is required to be reported in the tax returns of the partners in accordance with the terms of the Partnership Agreement. However, the Company is taxed in certain states, the United Kingdom and Luxembourg. Accordingly, the Company has recognized federal, state, local and foreign taxes in accordance with US GAAP, as applicable.

In July 2006 the FASB issued FASB interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 is an interpretation of SFAS No. 109, “Accounting for Income Taxes.” The Company adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, no uncertain tax positions were identified which would result in the recording of a liability for unrecognized tax benefits, and correspondingly no benefit recognition was identified that would affect the effective tax rate. Additionally, there are no possibly significant unrecognized tax benefits which are reasonably expected to occur within the next 12 months. The Company’s policy is to recognize interest accrued related to unrecognized benefits in interest expense and penalties in other expense. There are no interest and penalties deducted in the current period and no interest and penalties accrued at December 31, 2008 and December 31, 2007.

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

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

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Foreign Currency Translation

The functional currency of the Company’s United Kingdom operations is pounds sterling. The Company translates the financial statements for the United Kingdom operations into US dollars. Gains and losses resulting from this translation do not impact the results of operations and are included in general partner’s equity-common units. Other comprehensive (loss) income was ($26.8) million, $1.1 million and $10.4 million for the years ended December 31, 2008, 2007 and 2006, respectively. Upon sale or upon complete or substantially complete liquidation of a foreign investment, the gain or loss on the sale will include the cumulative translation adjustments that have been previously recorded in general partner’s equity-common units.

Recently Issued Accounting Standards

SFAS No. 157

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS No. 157”), which defines fair value, establishes a framework for consistently measuring fair value under US GAAP and expands disclosures about fair value measurements. The hierarchy is measured in three levels based on the reliability of inputs:

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

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

SFAS No. 159

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

SFAS No. 141(R)

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

SFAS No. 160

In December 2007, the FASB issued SFAS No. 160, “Accounting for Noncontrolling Interests” (“SFAS No. 160”). Under this statement, noncontrolling interests are considered equity and thus the Company’s practice of reporting minority interests in the mezzanine section of the balance sheet will be eliminated. Also, under SFAS No. 160, net income will encompass the total income of all consolidated subsidiaries and there will be separate disclosure on the face of the statement of operations of the attribution of that income between controlling and noncontrolling interests. Finally, increases and decreases in noncontrolling interests will be treated as equity transactions. The standard is effective on January 1, 2009. The Company does not anticipate that the adoption of this statement will have a material effect on its financial position or results of operations.

FSP EITF 03-6-1

In June 2008, the FASB issued FASB Staff Position (“FSP”) Emerging Issues Task Force (“EITF”) 03-6-1, “Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities.” The FSP clarifies that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents are participating securities and shall be included in the computation of earnings per share pursuant to the

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two-class method. FSP EITF 03-6-1 is effective for fiscal years beginning after December 15, 2008. The Company does not anticipate that the adoption of this statement will have a material effect on its financial position or results of operations.

3. REAL ESTATE

The Company owns and operates industrial and office properties located principally in suburban mixed-use developments or business parks. The carrying value of these properties by type as of December 31, 2008 and 2007 is as follows (in thousands):

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

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

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

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

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

2008 Sales

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

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2007 Sales

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

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

4. INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES

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

Liberty Venture I, LP

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

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

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

Kings Hill Unit Trust

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

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

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

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

Liberty/Commerz 1701 JFK Boulevard, LP

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

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

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

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

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

Liberty Illinois, LP

On April 25, 2006, the Company entered into a joint venture (“Liberty Illinois, LP”) with the New York State Common Retirement Fund, selling a 75% equity interest in six industrial properties totaling 2.1 million square feet and 104 acres of developable land. The joint venture valued the buildings and land at $125.0 million.

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

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

Blythe Valley JV Sarl

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

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

Liberty Washington, LP

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

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

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

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

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Other Joint Ventures

As of December 31, 2008, the Company has a 50% ownership interest in three additional unconsolidated joint ventures. One of these joint ventures has three operating properties and investments in a property under development and land held for development. For the development project, the Company has guaranteed cost overruns in excess of the approved project budget. The Company considers payments under the guarantee unlikely. One of these joint ventures has one operating property, an investment in land held for development and a leasehold interest. The other joint venture has a leasehold interest and does not operate or own operating properties.

The Company’s share of each of the joint venture’s earnings is included in equity in earnings (loss) of unconsolidated joint ventures in the accompanying consolidated statements of operations.

The condensed balance sheets as of December 31, 2008 and 2007 and statements of operations for Liberty Venture I, LP, Kings Hill Unit Trust, Liberty Illinois, LP, Blythe Valley JV Sarl, Liberty Washington, LP, Liberty Commerz 1701 JFK Boulevard, LP and other unconsolidated joint ventures for the years ended December 31, 2008, 2007 and 2006 are as follows (in thousands):

Balance Sheets:

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

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

(1) Differences between the Company’s net investment in unconsolidated joint ventures and its underlying equity in the net assets of the venture is primarily a result of the deferral of gains associated with the sales of properties to joint ventures in which the Company retains an ownership interest and loans made to the joint ventures by the Company. Deferred gains are amortized to equity in earnings (loss) of joint ventures over the average estimated useful lives of the assets sold.

Statements of Operations:

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

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

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

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5. DEFERRED FINANCING AND LEASING COSTS

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

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

6. INDEBTEDNESS

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

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

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

During the year ended December 31, 2006, the Company satisfied a $100 million 6.95% medium term note and issued a $300 million 5.50% senior unsecured note due December 15, 2016. The Company used the net proceeds to pay down outstanding borrowings under the Company’s unsecured credit facility and for general corporate purposes.

The Company is subject to financial covenants contained in some of the debt agreements, the most restrictive of which are detailed below under the heading “Credit Facility.” As of December 31, 2008 the Company was in compliance with all financial covenants.

Mortgage Loans, Unsecured Notes

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

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

Credit Facility

$600 Million Unsecured Revolving Credit Facility

The Company has a four-year, $600 million unsecured revolving credit facility (the “$600 million Credit Facility”). Based on the Company’s present ratings, borrowings under the $600 million Credit Facility are priced at LIBOR plus 65 basis points. The $600 million Credit Facility contains a competitive bid option, whereby participating lenders bid on the interest rate to be charged. This feature is available for up to 50% of the amount of the facility. The interest rate on the $260.0 million of borrowings outstanding as of December 31, 2008 was 1.56%. The current ratings for the Company’s senior unsecured debt are Baa2, BBB, and BBB+ from Moody’s, S&P and Fitch, respectively. The $600 million Credit Facility has an accordion feature for an additional $200 million. There is also a 15 basis point annual facility fee on the current borrowing capacity. The $600 million Credit Facility expires on January 16, 2010 and may

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be extended for a one-year period. The fee to extend the $600 million Credit Facility for one year is $900,000. The $600 million Credit Facility contains financial covenants, certain of which are set forth below:

• total debt to total assets may not exceed 0.60:1;

• earnings before interest, taxes, depreciation and amortization to fixed charges may not be less than 1.50:1;

• unsecured debt to unencumbered asset value must equal or be less than 60%; and

• unencumbered net operating income to unsecured interest expense must equal or exceed 200%.

The scheduled principal amortization and maturities of the Company’s mortgage loans, unsecured notes outstanding and the $600 million Credit Facility and the related weighted average interest rates are as follows (in thousands, except percentages):

											Weighted
	Mortgages										Average
	Principal		Principal		Unsecured		Credit				Interest
	Amortization		Maturities		Notes		Facility		Total		Rate
2009	$	6,586	$	41,833	$	270,000	$	—	$	318,419		7.76	%
2010		5,823		4,736		176,607		260,000		447,166		4.40	%
2011		5,159		13,409		250,000		—		268,568		7.23	%
2012		4,336		32,875		235,000		—		272,211		6.47	%
2013		3,857		4,510		—		—		8,367		5.79	%
2014		3,888		2,684		200,000		—		206,572		5.66	%
2015		3,336		44,469		300,000		—		347,805		5.25	%
2016		2,409		16,880		300,000		—		319,289		5.55	%
2017		1,770		—		300,000		—		301,770		6.62	%
2018 & thereafter		—		—		100,000		—		100,000		7.50	%
	$	37,164	$	161,396	$	2,131,607	$	260,000	$	2,590,167		6.06	%

7. LEASING ACTIVITY

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

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

In addition to minimum rental payments, most leases require the tenants to pay for their pro rata share of specified operating expenses. These payments are included as operating expense reimbursement in the accompanying consolidated statements of operations.

8. OWNERS’ EQUITY

Common Units

General and Limited partners’ equity — common units relates to limited partnership interests of the Operating Partnership issued in connection with the formation of the Company and certain subsequent acquisitions. During 2006, 684,432 common units were issued in connection with an acquisition. No common units were issued in connection with acquisitions during 2008 or 2007. The common units outstanding as of December 31, 2008 have the same economic characteristics as common shares of the Trust. The 4,074,967 common units are the common units held by persons and entities other than Liberty Property Trust, the general partner of Liberty Property Limited Partnership, which holds a number of common units equal to the number of outstanding common shares of beneficial interest. Both the common units held by Liberty Property Trust and the common units held by persons and entities other than Liberty Property Trust are counted in the weighted average number of common units outstanding during

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any given period. The 4,074,967 common units share proportionately in the net income or loss and in any distributions of the Operating Partnership and are exchangeable into the same number of common shares of the Trust. The market value of the 4,074,967 common units at December 31, 2008 based on the closing price of the shares of the Company at December 31, 2008 was $93.0 million.

Preferred Units

The Company has outstanding the following Cumulative Redeemable Preferred Units of the Operating Partnership, (the “Preferred Units”):

Date of						Liquidation		Dividend			Redeemable
Issue	Issue	Amount		Units		Preference		Rate			As of		Exchangeable After
(in 000’s)
7/28/99	Series B	$	95,000		3,800	$	25		7.45	%		8/31/09	1/1/14 into Series B Cumulative Redeemable Preferred Shares of the Trust
6/16/05	Series E	$	20,000		400	$	50		7.00	%		6/16/10	6/16/15 into Series E Cumulative Redeemable Preferred Shares of the Trust
6/30/05	Series F	$	44,000		880	$	50		6.65	%		6/30/10	6/30/15 into Series F Cumulative Redeemable Preferred Shares of the Trust
8/23/05	Series F	$	6,000		120	$	50		6.65	%		6/30/10	6/30/15 into Series F Cumulative Redeemable Preferred Shares of the Trust
12/15/06	Series G	$	27,000		540	$	50		6.70	%		12/12/11	12/12/16 into Series G Cumulative Redeemable Preferred Shares of the Trust
8/21/07	Series H	$	100,000		4,000	$	25		7.40	%		8/21/12	8/21/17 into Series H Cumulative Redeemable Preferred Shares of the Trust

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

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

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

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

Minority Interest

Minority interest includes third-party ownership interests in consolidated joint venture investments.

9. COMMITMENTS AND CONTINGENCIES

Substantially all of the Properties and land were subject to Phase I Environmental Assessments and when appropriate Phase II Environmental Assessments (collectively, the “Environmental Assessments”) obtained in contemplation of their acquisition by the Company. The Environmental Assessments consisted of, among other activities, a visual inspection of each Property and its neighborhood and a check of pertinent public records. The Environmental Assessments did not reveal, nor is the Company aware of, any non-compliance with environmental laws, environmental liability or other environmental claim that the Company believes would likely have a material adverse effect on the Company.

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

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

The Company maintains cash and cash equivalents at financial institutions. The combined account balances at each institution typically exceed FDIC insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes the risk is not significant.

Litigation

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

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

10. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

A summary of quarterly results of operations for the years ended December 31, 2008 and 2007 follows. Certain amounts have been reclassified to conform to the current presentation of discontinued operations (in thousands, except per share amounts).

	Quarter Ended
	Dec. 31,		Sept. 30,		June 30,		Mar. 31,		Dec. 31,		Sept. 30,		June 30,		Mar. 31,
	2008		2008		2008		2008		2007		2007		2007		2007
Operating revenue	$	189,202	$	186,616	$	182,756	$	189,946	$	185,136	$	173,818	$	165,757	$	162,120
Income from continuing operations		48,847		34,637		34,863		35,195		31,147		37,019		39,408		39,697
Discontinued operations		10,347		10,916		3,447		1,371		11,267		6,106		19,896		5,669
Income available to common unitholders		53,941		40,300		33,057		31,313		37,161		38,879		54,834		41,513
Income per common unit — basic (1)		0.53		0.41		0.34		0.33		0.39		0.41		0.57		0.44
Income per common unit — diluted (1)		0.53		0.41		0.34		0.33		0.39		0.41		0.57		0.43

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

11. SEGMENT INFORMATION

The Company operates its portfolio of properties primarily throughout the Mid-Atlantic, Southeastern, Midwestern and Southwestern United States. Additionally, the Company owns certain assets in the United Kingdom. The Company reviews the performance of the portfolio on a geographical basis. As such, the following regions are considered the Company’s reportable segments:

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

The Company’s reportable segments are distinct business units which are each managed separately in order to concentrate market knowledge within a geographic area. Within these reportable segments, the Company derives its revenues from its two product types: industrial properties and office properties.

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

The Company evaluates performance of the reportable segments based on property level operating income, which is calculated as rental revenue and operating expense reimbursement less rental property expenses and real estate taxes. The accounting policies of the reportable segments are the same as those for the Company on a consolidated basis.

The operating information by segment is as follows (in thousands):

YEAR ENDED DECEMBER 31, 2008

	Northeast
			Lehigh/
	Southeastern		Central		New								phila-		united
	PA		PA		Jersey		Midwest		mid-atlantic		South		delphia		kingdom		total
Operating revenue		$178,507		$99,418		$38,004		$82,964		$142,543		$173,319		$29,426		$4,339		$748,520
Rental property expenses and real estate taxes		57,729		26,978		14,848		31,074		41,652		57,990		7,791		1,044		239,106
Property level operating income		$120,778		$72,440		$23,156		$51,890		$100,891		$115,329		$21,635		$3,295		509,414
Interest and other income																		13,508
Debt extinguishment gain																		2,521
Interest expense																		(155,675)
General and administrative																		(54,378)
Depreciation and amortization																		(173,097)
Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures																		142,293
Gain on property dispositions																		10,572
Income taxes																		(1,645)
Minority interest																		(483)
Equity in earnings of unconsolidated joint ventures																		2,805
Discontinued operations																		26,081
Net income																		$179,623

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YEAR ENDED DECEMBER 31, 2007

	Northeast
	Southeastern		Lehigh/		New				mid-				phila-		united
	PA		Central PA		Jersey		Midwest		atlantic		South		delphia		kingdom		total
Operating revenue		$172,142		$91,631		$36,162		$80,926		$128,599		$150,693		$23,963		$2,715		$686,831
Rental property expenses and real estate taxes		56,950		23,616		9,228		28,061		38,524		50,419		9,378		33		216,209
Property level operating income		$115,192		$68,015		$26,934		$52,865		$90,075		$100,274		$14,585		$2,682		470,622
Interest and other income																		11,727
Interest expense																		(127,058)
General and administrative																		(54,249)
Depreciation and amortization																		(155,616)
Income before property dispositions, income taxes, minority interest and equity in loss of unconsolidated joint ventures																		145,426
Gain on property dispositions																		1,463
Income taxes																		709
Minority interest																		(101)
Equity in loss of unconsolidated joint ventures																		(226)
Discontinued operations																		42,938
Net income																		$190,209

YEAR ENDED DECEMBER 31, 2006

	Northeast
	Southeastern		Lehigh/		New								phila-		united
	PA		Central PA		Jersey		Midwest		mid-atlantic		South		delphia		kingdom		total
Operating revenue		$168,227		$83,849		$34,584		$75,966		$114,593		$113,347		$15,829		$1,167		$607,562
Rental property expenses and real estate taxes		54,181		20,434		8,128		26,752		33,925		36,822		6,913		261		187,416
Property level operating income		$114,046		$63,415		$26,456		$49,214		$80,668		$76,525		$8,916		$906		420,146
Interest and other income																		8,693
Interest expense																		(109,482)
General and administrative																		(46,332)
Depreciation and amortization																		(132,106)
Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures																		140,919
Gain on property dispositions																		17,628
Income taxes																		(288)
Minority interest																		7
Equity in earnings of unconsolidated joint ventures																		1,432
Discontinued operations																		132,352
Net income																		$292,050

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Product Type Information

	Real Estate Related Revenues
	Year Ended December 31,
	2008		2007		2006
Industrial	$	300,763	$	274,865	$	253,222
Office		447,757		411,966		354,340
Total operating revenue	$	748,520	$	686,831	$	607,562

ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT

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

ROLLFORWARD OF OPERATING REAL ESTATE ASSETS BY REPORTABLE SEGMENT

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

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

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12. SFAS NO. 144, “ACCOUNTING FOR THE IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS”

Discontinued Operations In accordance with SFAS No. 144, the operating results and gain/(loss) on disposition of real estate for properties sold and held for sale are reflected in the consolidated statements of operations as discontinued operations. Prior year financial statements have been adjusted for discontinued operations. The proceeds from dispositions of operating properties with no continuing involvement were $80.0 million and $369.5 million for the years ended December 31, 2008 and 2007, respectively.

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

	Year Ended December 31,
	2008			2007			2006
Revenues	$	13,295		$	43,330		$	85,536
Operating expenses		(5,377	)		(17,375	)		(31,202	)
Interest expense		(2,203	)		(6,957	)		(14,764	)
Depreciation and amortization		(3,153	)		(9,671	)		(19,838	)
Income before property dispositions and minority interest	$	2,562		$	9,327		$	19,732

Six properties totaling 296,000 square feet located in the Company’s Mid-Atlantic segment are considered to be held for sale as of December 31, 2008.

Interest expense is allocated to discontinued operations as permitted under EITF Issue 87-24, "Allocation of Interest to Discontinued Operations,” and such interest expense has been included in computing income from discontinued operations. The allocation of interest expense to discontinued operations was based on the ratio of net assets sold (without continuing involvement) to the sum of total net assets plus consolidated debt.

Asset Impairment

In accordance with SFAS No. 144, during the years ended December 31, 2008, 2007 and 2006, the Company recognized impairment losses of $3.1 million, $0.2 million and $4.2 million, respectively. The 2008 impairment loss of $3.1 million was recognized in the fourth quarter and was related to a 49,000 square foot operating property in the Midwest segment, a 110,000 square foot operating property in Southeastern PA and a 296,000 square foot portfolio of operating properties in the Mid-Atlantic segment. The 2007 impairment loss of $0.2 million was related to various land parcels. The 2006 impairment loss of $4.2 million was primarily related to a 352,000 square foot portfolio of operating properties in the Midwest segment. For the years ended December 31, 2008 and 2006, respectively, $3.1 million and $4.2 million in impairment related to properties sold or held for sale were included in the caption discontinued operations in the Company’s statement of operations. For the year ended December 31, 2007, $0.2 million in impairment was included in the caption gain on property dispositions as a component of income from continuing operations. The Company determined these impairments through a comparison of the aggregate future cash flows (including quoted offer prices) to be generated by the properties to the carrying value of the properties. The Company has evaluated each of the properties and land held for development and has determined that there are no additional valuation adjustments necessary at December 31, 2008.

13. SUBSEQUENT EVENTS

In December 2008, the Company commenced the sale of common shares pursuant to a continuous offering program. From January 1, 2009 through February 23, 2009, the Company sold 2.3 million common shares through this program. The net proceeds from the offering of $47.4 million were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

In February 2009, the Company closed on mortgages totaling $193.2 million. The mortgages encumber certain of the Company’s Properties in Operation. The net proceeds from these mortgages were used to pay down outstanding borrowings under the $600 million Credit Facility and for general corporate purposes.

108

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

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

109

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

110

								Costs
								Capitalized										Date of
								Subsequent		Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to		Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition		Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
8995 Columbine Road	Eden Prairie, MN		—		1,087,594				3,664,053		2,055,296		2,696,352		4,751,648		595,546	2001	40 yrs.
8911 Columbine Road (B2)	Eden Prairie, MN		—		916,687				3,608,469		1,718,407		2,806,748		4,525,156		535,211	2000	40 yrs.
8855 Columbine Road	Eden Prairie, MN		—		1,400,925				5,226,016		1,599,757		5,027,185		6,626,941		581,470	2000	40 yrs.
7075 Flying Cloud Drive	Eden Prairie, MN		—		10,232,831		10,855,851		53,337		10,243,977		10,898,042		21,142,019		500,941	2007	40 yrs.
7351 Coca Cola Drive	Elkridge, MD		—		1,897,044		—		7,048,446		3,023,417		5,922,074		8,945,491		224,957	2006	40 yrs.
180 Sheree Boulevard	Exton, PA		5,157,523		2,647,861		11,334,403		2,049,934		2,649,426		13,382,772		16,032,198		1,066,878	2007	40 yrs.
7028 Snowdrift Road	Fogelville, PA		—		520,473		959,279		292,813		524,390		1,248,175		1,772,565		371,902	1982	40 yrs.
420 Delaware Drive	Fort Washington, PA		—		2,766,931		—		8,290,888		2,826,994		8,230,825		11,057,819		571,917	2005	40 yrs.
414 Commerce Drive	Fort Washington, PA		—		1,267,194		2,217,460		307,900		1,267,937		2,524,616		3,792,553		231,189	2004	40 yrs.
275 Commerce Drive	Fort Washington, PA		—		1,775,894		2,160,855		7,433,770		1,790,041		9,580,478		11,370,519		142,837	2005	40 yrs.
1250 Virginia Drive	Fort Washington, PA		—		1,639,166		1,928,574		468,379		1,650,703		2,385,416		4,036,119		224,244	2005	40 yrs.
1100 Virginia Drive	Fort Washington, PA		—		22,612,437		—		55,809,125		23,339,943		55,081,619		78,421,562		2,007,575	2006	40 yrs.
1100 Virginia Drive	Fort Washington, PA		—		13,007,509		11,480,744		53,906		13,035,013		11,507,146		24,542,159		915,103	2006	40 yrs.
106 Southchase Boulevard	Fountain Inn, SC		—		201,944		—		5,133,389		684,003		4,651,330		5,335,333		358,667	2005	40 yrs.
9601 Cosner Drive	Fredericksburg, VA		—		475,262		3,917,234		214,221		475,262		4,131,454		4,606,716		1,391,089	1995	40 yrs.
200 W Cypress Creek Road	Ft Lauderdale, FL		—		3,414,989		2,399,738		10,524,649		3,414,989		12,924,387		16,339,376		1,924,698	2003	40 yrs.
5410 - 5430 Northwest 33rd Avenue	Ft. Lauderdale, FL		—		603,776		4,176,238		1,156,270		625,111		5,311,174		5,936,284		1,660,664	1985	40 yrs.
6500 NW 12th Avenue	Ft. Lauderdale, FL		—		7,099		3,046,309		475,723		—		3,529,130		3,529,130		1,143,136	1989	40 yrs.
6600 NW 12th Avenue	Ft. Lauderdale, FL		—		7,102		3,047,462		772,549		—		3,827,114		3,827,114		1,136,170	1989	40 yrs.
4880 Cox Road	Glen Allen, VA		—		743,898		4,499,807		3,058,575		743,898		7,558,382		8,302,280		1,840,837	1995	40 yrs.
5000 Cox Road	Glen Allen, VA		—		770,214		3,685,248		315,413		771,029		3,999,846		4,770,875		1,331,758	1990	40 yrs.
5500 Cox Road	Glen Allen, VA		—		443,485		—		3,546,671		483,263		3,506,893		3,990,156		1,152,858	1999	40 yrs.
4801 Cox Road	Glen Allen, VA		—		1,072,896		—		10,198,472		1,075,620		10,195,748		11,271,368		3,297,151	1998	40 yrs.
4198 Cox Road	Glen Allen, VA		—		670,292		3,839,245		1,241,555		670,292		5,080,800		5,751,092		1,645,466	1984	40 yrs.
4510 Cox Road	Glen Allen, VA		—		1,010,024		7,151,729		1,907,500		1,010,044		9,059,209		10,069,253		3,108,655	1990	40 yrs.
4121 Cox Road	Glen Allen, VA		—		1,083,006		6,035,653		952,101		1,083,006		6,987,754		8,070,760		955,534	2004	40 yrs.
200 Southchase Boulevard	Greenville, SC		—		512,911				6,273,615		515,542		6,270,984		6,786,525		792,280	2003	40 yrs.
45 Brookfield Oaks Drive	Greenville, SC		—		818,114		—		3,549,097		825,529		3,541,682		4,367,212		118,418	2006	40 yrs.
116 Pleasant Ridge Road	Greenville, SC		—		1,547,811		—		13,298,582		3,712,683		11,133,710		14,846,393		131,493	2006	40 yrs.
7 Research Drive	Greenville, SC		—		—		17,091,882		4,405		—		17,096,287		17,096,287		752,159	2007	40 yrs.
1487 South Highway 101	Greer, SC		—		464,237		—		5,136,776		1,301,738		4,299,275		5,601,012		13,817	2007	40 yrs.
1 Enterprise Parkway	Hampton, VA		—		974,675		5,579,869		1,433,088		974,675		7,012,957		7,987,632		2,255,340	1987	40 yrs.
22 Enterprise Parkway	Hampton, VA		—		1,097,368		6,760,778		1,257,471		1,097,368		8,018,248		9,115,617		2,462,312	1990	40 yrs.
5 Manhattan Square	Hampton, VA		—		207,368		—		1,663,695		212,694		1,658,368		1,871,063		543,765	1999	40 yrs.
1317 Executive Boulevard	Hampton, VA		—		1,650,423		—		7,668,631		1,128,829		8,190,225		9,319,054		348,381	2006	40 yrs.
21 Enterprise Parkway	Hampton, VA		—		263,668		8,167,118		382,338		265,719		8,547,405		8,813,124		1,848,003	1999	40 yrs.
521 Butler Farm Road	Hampton, VA		—		750,769		2,911,149		261,271		710,486		3,212,702		3,923,188		464,095	2003	40 yrs.
7317 Parkway Drive	Hanover, MD		—		1,104,359		1,959,671		79,319		1,104,359		2,038,990		3,143,349		570,967	1983	40 yrs.
600 Industrial Drive	Harrisburg, PA		—		7,743,800		—		28,472,202		9,368,557		26,847,444		36,216,001		1,554,062	2005	40 yrs.
500 McCarthy Drive	Harrisburg, PA		—		5,194,872		19,991,436		4,234,765		5,687,013		23,734,060		29,421,073		3,011,485	2005	40 yrs.
4170 Mendenhall Oaks Parkway	High Point , NC		—		143,699		—		2,210,943		373,502		1,981,140		2,354,642		655,531	1999	40 yrs.
4180 Mendenhall Oaks Parkway	High Point , NC		—		121,329		—		1,835,505		315,614		1,641,220		1,956,834		584,926	1999	40 yrs.
4050 Piedmont Parkway	High Point , NC		—		801,902		—		20,721,590		2,042,159		19,481,334		21,523,492		5,353,041	1998	40 yrs.
4523 Green Point Drive	High Point, NC		—		234,564		—		3,109,110		235,698		3,107,976		3,343,674		1,269,229	1988	40 yrs.
4501 Green Point Drive	High Point, NC		—		319,289		—		2,606,925		320,450		2,605,765		2,926,214		1,303,596	1989	40 yrs.
4500 Green Point Drive	High Point, NC		—		230,622		—		2,310,319		231,692		2,309,249		2,540,941		1,196,924	1989	40 yrs.
2427 Penny Road	High Point, NC		—		1,165,664		—		3,476,301		655,240		3,986,724		4,641,965		1,791,684	1990	40 yrs.
4524 Green Point Drive	High Point, NC		—		182,810		—		2,396,132		183,888		2,395,053		2,578,942		1,194,991	1989	40 yrs.
4344 Federal Drive	High Point, NC		—		484,001		—		2,780,986		173,623		3,091,365		3,264,988		1,223,712	1996	40 yrs.
4000 Piedmont Parkway	High Point, NC		—		592,885		4,825,615		929,937		597,368		5,751,069		6,348,438		2,122,813	1989	40 yrs.
4380 Federal Drive	High Point, NC		—		282,996		—		2,204,882		283,368		2,204,510		2,487,878		859,427	1997	40 yrs.
4388 Federal Drive	High Point, NC		—		143,661		—		1,210,692		132,655		1,221,699		1,354,353		492,073	1997	40 yrs.
4160 Mendenhall Oaks Parkway	High Point, NC		—		285,882		—		3,361,383		545,627		3,101,638		3,647,265		1,010,657	1998	40 yrs.
4194 Mendenhall Oaks Parkway	High Point, NC		—		102,372		—		2,619,333		265,991		2,455,714		2,721,705		830,855	1999	40 yrs.
4196 Mendenhall Oaks Parkway	High Point, NC		—		66,731		—		2,510,094		173,889		2,402,936		2,576,825		857,473	1999	40 yrs.
4300 Federal Drive	High Point, NC		—		264,038		—		2,098,260		276,038		2,086,260		2,362,298		472,345	1998	40 yrs.
4135 Mendenall Oaks Parkway	High Point, NC		—		499,500		—		3,498,674		500,980		3,497,193		3,998,174		863,928	2000	40 yrs.
1498 Eagle Hill Drive	High Point, NC		—		94,274		—		5,933,606		791,880		5,235,999		6,027,879		220,175	2005	40 yrs.
4183 Eagle Hill Drive	High Point, NC		—		122,203				3,911,210		526,266		3,507,147		4,033,413		1,389,311	2001	40 yrs.
4189 Eagle Hill Drive	High Point, NC		—		100,106				3,430,006		431,106		3,099,006		3,530,112		888,462	2001	40 yrs.
4020 Meeting Way	High Point, NC		—		94,232				1,682,549		378,101		1,398,680		1,776,781		377,882	2001	40 yrs.
1400 Mendenhall Oaks Parkway	High Point, NC		—		172,320				7,281,025		984,672		6,468,673		7,453,345		1,437,607	2002	40 yrs.
4191 Mendenhall Oaks Parkway	High Point, NC		—		217,943				3,114,814		611,166		2,721,590		3,332,756		587,303	2002	40 yrs.
4015 Meeting Way	High Point, NC		—		510,000		—		2,787,760		511,869		2,785,890		3,297,759		296,429	2003	40 yrs.
4195 Eagle Hill Drive	High Point, NC		—		107,586		—		3,425,118		505,700		3,027,005		3,532,705		307,026	2004	40 yrs.
400 Mendenhall Oaks Parkway	High Point, NC		—		—		—		1,859,604		665,239		1,194,365		1,859,604		80,912	2004	40 yrs.
4475 Premier Drive	High Point, NC		—		748,693		—		5,888,692		1,525,421		5,111,964		6,637,385		86,535	2006	40 yrs.
4328, 4336 Federal Drive	High Point, NC		3,977,231		521,122		—		7,300,519		825,092		6,996,548		7,821,641		3,907,767	1995	40 yrs.
100 Witmer Road	Horsham, PA		—		3,102,784		—		18,701,183		3,764,784		18,039,184		21,803,967		3,510,902	1996	40 yrs.
132 Welsh Road	Horsham, PA		—		1,333,642		—		4,692,880		1,408,041		4,618,480		6,026,521		1,665,412	1998	40 yrs.
300 Welsh Road — Building 3	Horsham, PA		—		180,459		1,441,473		375,923		180,459		1,817,396		1,997,855		664,949	1983	40 yrs.
300 Welsh Road — Building 4	Horsham, PA		—		282,493		2,256,508		1,843,483		282,493		4,099,990		4,382,483		1,340,245	1983	40 yrs.
2 Walnut Grove Drive	Horsham, PA		—		1,281,870		7,767,374		1,961,590		1,265,363		9,745,470		11,010,834		3,415,954	1989	40 yrs.
5 Walnut Grove Drive	Horsham, PA		—		1,065,951		—		10,117,753		1,939,712		9,243,992		11,183,704		2,280,276	2000	40 yrs.
200 Gibraltar Road	Horsham, PA		—		638,513		5,811,323		1,947,714		638,513		7,759,036		8,397,550		2,878,638	1990	40 yrs.
220 Gibraltar Road	Horsham, PA		—		629,944		5,733,228		1,455,917		629,944		7,189,145		7,819,089		2,644,772	1990	40 yrs.

111

								Costs
								Capitalized										Date of
								Subsequent		Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to		Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition		Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
240 Gibraltar Road	Horsham, PA		—		629,944		5,733,234		1,915,620		629,944		7,648,854		8,278,798		2,937,215	1990	40 yrs.
1 Walnut Grove Drive	Horsham, PA		—		1,058,901		5,343,606		1,041,557		1,058,901		6,385,163		7,444,064		2,345,767	1986	40 yrs.
181-187 Gibraltar Road	Horsham, PA		—		360,549		3,259,984		787,154		360,549		4,047,138		4,407,687		1,336,533	1982	40 yrs.
104 Rock Road	Horsham, PA		—		330,111		2,981,669		594,916		330,111		3,576,586		3,906,696		941,454	1974	40 yrs.
123-135 Rock Road	Horsham, PA		—		292,360		2,411,677		2,409,782		393,019		4,720,800		5,113,819		1,162,452	1975	40 yrs.
111-159 Gibraltar Road	Horsham, PA		—		489,032		4,126,151		1,367,375		489,032		5,493,526		5,982,558		1,693,767	1981	40 yrs.
161-175 Gibraltar Road	Horsham, PA		—		294,673		2,663,722		987,299		294,673		3,651,020		3,945,694		1,105,985	1976	40 yrs.
103-109 Gibraltar Road	Horsham, PA		—		270,906		2,448,500		818,872		270,906		3,267,371		3,538,278		1,270,550	1978	40 yrs.
210-223 Witmer Road	Horsham, PA		—		270,282		2,441,276		1,940,611		270,282		4,381,887		4,652,169		1,282,445	1972	40 yrs.
100 Gibraltar Road	Horsham, PA		—		38,729		349,811		9,589		38,729		359,400		398,129		99,409	1975	40 yrs.
101 Gibraltar Road	Horsham, PA		—		651,990		5,888,989		1,561,435		732,552		7,369,862		8,102,414		2,305,103	1977	40 yrs.
506 Prudential Road	Horsham, PA		—		208,140		895,470		723,059		208,140		1,618,529		1,826,669		440,823	1973	40 yrs.
113-123 Rock Road	Horsham, PA		—		351,072		3,171,001		589,814		451,731		3,660,155		4,111,887		1,012,999	1975	40 yrs.
101-111 Rock Road	Horsham, PA		—		350,561		3,166,389		864,263		452,251		3,928,962		4,381,213		1,231,119	1975	40 yrs.
120 Gibraltar Road	Horsham, PA		—		533,142		4,830,515		2,416,512		558,142		7,222,027		7,780,169		1,897,838	1980	40 yrs.
110 Gibraltar Road	Horsham, PA		—		673,041		5,776,369		2,584,619		673,041		8,360,988		9,034,029		2,534,483	1979	40 yrs.
100-107 Lakeside Drive	Horsham, PA		—		239,528		2,163,498		712,712		255,528		2,860,210		3,115,738		976,181	1982	40 yrs.
200-264 Lakeside Drive	Horsham, PA		—		502,705		4,540,597		1,536,610		502,705		6,077,207		6,579,912		1,814,424	1982	40 yrs.
300-309 Lakeside Drive	Horsham, PA		—		369,475		3,338,761		1,842,034		376,475		5,173,795		5,550,270		1,986,944	1982	40 yrs.
400-445 Lakeside Drive	Horsham, PA		—		543,628		4,910,226		2,760,384		583,628		7,630,610		8,214,238		2,476,732	1981	40 yrs.
201 Gibraltar Road	Horsham, PA		—		380,127		3,433,433		1,997,494		380,802		5,430,252		5,811,054		1,627,010	1983	40 yrs.
300 Welsh Road	Horsham, PA		—		696,061		3,339,991		570,429		696,061		3,910,420		4,606,480		1,115,040	1985	40 yrs.
700 Dresher Road	Horsham, PA		—		2,551,777		3,020,638		4,696,950		2,565,140		7,704,225		10,269,365		3,764,912	1987	40 yrs.
680 Blair Mill Road	Horsham, PA		—		3,527,151				17,434,151		4,138,577		16,822,725		20,961,302		3,116,684	2001	40 yrs.
102 Rock Road	Horsham, PA		—		1,110,209		2,301,302		1,133,191		1,114,985		3,429,717		4,544,702		662,819	1985	40 yrs.
335 Commerce Drive	Horsham, PA		—		—		—		8,757,475		182,400		8,575,075		8,757,475		1,064,979	2002	40 yrs.
255 Business Center Drive	Horsham, PA		—		1,154,289		2,007,214		573,608		1,140,597		2,594,513		3,735,111		391,690	2003	40 yrs.
355 Business Center Drive	Horsham, PA		—		483,045		898,798		253,426		471,171		1,164,098		1,635,270		243,111	2003	40 yrs.
455 Business Center Drive	Horsham, PA		—		1,351,011		2,503,449		1,927,940		1,322,317		4,460,083		5,782,400		1,031,964	2003	40 yrs.
555 Business Center Drive	Horsham, PA		—		727,420		1,353,650		194,047		709,967		1,565,151		2,275,118		345,712	2003	40 yrs.
7 Walnut Grove Drive	Horsham, PA		—		2,631,696		—		18,587,588		2,631,956		18,587,328		21,219,284		621,811	2006	40 yrs.
261-283 Gibraltar Road	Horsham, PA		*		464,871		3,951,972		1,775,341		464,871		5,727,312		6,192,183		1,216,076	1978	40 yrs.
231-237 Gibraltar Road	Horsham, PA		*		436,952		3,948,963		727,352		436,952		4,676,314		5,113,267		1,504,124	1981	40 yrs.
104 Witmer Road	Horsham, PA		*		1,248,148		—		1,133,749		189,793		2,192,104		2,381,897		931,792	1975	40 yrs.
719 Dresher Road	Horsham, PA		*		493,426		2,812,067		251,335		495,112		3,061,716		3,556,828		851,187	1987	40 yrs.
4 Walnut Grove	Horsham, PA		*		2,515,115		—		10,792,470		2,515,115		10,792,470		13,307,585		1,870,755	1999	40 yrs.
747 Dresher Road	Horsham, PA		—		1,607,238		—		5,193,398		1,607,977		5,192,658		6,800,636		2,713,953	1988	40 yrs.
507 Prudential Road	Horsham, PA		—		644,900		5,804,100		8,818,780		1,131,380		14,136,400		15,267,780		4,600,504	1988	40 yrs.
767 Electronic Drive	Horsham, PA		*		1,229,685		—		3,430,171		1,241,970		3,417,886		4,659,856		1,742,609	1996	40 yrs.
16445 Air Center Boulevard	Houston, TX		—		363,339		2,509,186		641,300		363,339		3,150,486		3,513,826		1,208,934	1997	40 yrs.
16405 Air Center Boulevard	Houston, TX		—		438,853		3,030,396		438,371		438,853		3,468,766		3,907,619		1,057,848	1997	40 yrs.
16580 Air Center Boulevard	Houston, TX		—		289,000		3,559,857		269,417		289,000		3,829,274		4,118,275		1,055,346	1997	40 yrs.
1755 Trans Central Drive	Houston, TX		—		293,534		3,036,269		190,651		306,147		3,214,306		3,520,453		752,950	1999	40 yrs.
16680 Central Green Boulevard	Houston, TX		—		311,952		—		3,956,813		492,869		3,775,895		4,268,765		83,075	2001	40 yrs.
16605 Air Center Boulevard	Houston, TX		—		298,999				3,770,315		496,186		3,573,128		4,069,314		988,599	2002	40 yrs.
10739 West Little York Road	Houston, TX		—		797,931		5,950,894		321,145		799,560		6,270,410		7,069,970		1,161,015	1999	40 yrs.
10735 West Little York Road	Houston, TX		—		1,110,988		6,351,946		1,711,950		1,135,483		8,039,401		9,174,884		1,159,934	2000	40 yrs.
8801-19 & 8821-49 Fallbrook Drive	Houston, TX		—		2,290,001		15,297,141		1,590,836		2,290,002		16,887,976		19,177,978		2,452,452	2000	40 yrs.
16685 Air Center Boulevard	Houston, TX		—		—		—		2,935,268		414,691		2,520,577		2,935,268		339,028	2004	40 yrs.
8825-8839 N Sam Houston Pkwy	Houston, TX		—		638,453		3,258,815		565,588		638,477		3,824,378		4,462,856		531,488	2004	40 yrs.
8850-8872 Fallbrook Drive	Houston, TX		—		504,317		2,878,351		1,014,679		504,341		3,893,006		4,397,347		563,067	2004	40 yrs.
8802-8824 Fallbrook Drive	Houston, TX		—		1,114,406		6,364,767		2,636,014		2,775,021		7,340,166		10,115,187		1,029,169	2004	40 yrs.
16602 Central Green Boulevard	Houston, TX		—		284,403		—		4,495,522		503,779		4,276,146		4,779,925		356,764	2005	40 yrs.
1646 Rankin Road	Houston, TX		—		329,961		—		4,895,126		592,234		4,632,853		5,225,087		384,256	2005	40 yrs.
8301 Fallbrook Drive	Houston, TX		—		4,515,862		—		23,627,618		5,877,884		22,265,596		28,143,480		334,684	2006	40 yrs.
5200 N. Sam Houston Parkway	Houston, TX		—		1,519,458		7,135,548		2,697,458		1,520,074		9,832,389		11,352,464		332,982	2007	40 yrs.
5250 N. Sam Houston Parkway	Houston, TX		—		2,173,287		8,868,256		1,972,563		2,173,942		10,840,164		13,014,106		306,826	2007	40 yrs.
11201 Greens Crossing Boulevard	Houston, TX		—		1,006,194		5,412,584		2,705,102		1,008,542		8,115,337		9,123,879		229,320	2007	40 yrs.
850 Greens Parkway	Houston, TX		—		2,893,405		11,593,197		2,456,282		2,899,861		14,043,023		16,942,883		340,455	2007	40 yrs.
860 Greens Parkway	Houston, TX		—		1,399,365		6,344,650		1,528,602		1,374,012		7,898,606		9,272,618		193,441	2007	40 yrs.
20 Wright Avenue	Hunt Valley, MD		—		1,205,946		—		9,645,838		1,861,025		8,990,759		10,851,784		2,048,033	2001	40 yrs.
4 North Park Drive	Hunt Valley, MD		—		3,269,948		13,551,370		1,458,110		3,269,948		15,009,480		18,279,428		2,150,558	2003	40 yrs.
6 North Park Drive	Hunt Valley, MD		—		2,077,949		8,770,566		984,562		2,077,949		9,755,128		11,833,077		1,644,000	2003	40 yrs.
10 North Park Drive	Hunt Valley, MD		—		2,211,969		7,816,042		238,720		2,211,969		8,054,762		10,266,731		1,069,482	2003	40 yrs.
307 International Circle	Hunt Valley, MD		—		3,538,319		14,190,832		13,353,055		3,542,881		27,539,324		31,082,206		2,691,105	2004	40 yrs.
309 International Circle	Hunt Valley, MD		—		613,667		2,458,204		700,193		615,096		3,156,968		3,772,064		302,865	2004	40 yrs.
311 International Circle	Hunt Valley, MD		—		313,365		1,281,093		76,921		314,572		1,356,807		1,671,380		108,395	2004	40 yrs.
8775 Baypine Road	Jacksonville, FL		—		906,804		—		10,034,442		913,013		10,028,233		10,941,246		2,358,535	1989	40 yrs.
8665,8667,8669 Baypine Road	Jacksonville, FL		—		966,552		—		5,987,169		974,959		5,978,762		6,953,721		3,075,507	1987	40 yrs.
7970 Bayberry Road	Jacksonville, FL		—		127,520		—		1,391,397		129,979		1,388,938		1,518,917		1,104,987	1978	40 yrs.
7077 Bonneval Road	Jacksonville, FL		—		768,000		5,789,000		3,526,767		774,020		9,309,747		10,083,767		4,201,227	1988	40 yrs.
4190 Belfort Road	Jacksonville, FL		—		821,000		5,866,000		3,356,397		827,420		9,215,977		10,043,397		4,496,680	1986	40 yrs.
7020 AC Skinner Parkway	Jacksonville, FL		—		398,257		—		2,717,001		749,811		2,365,448		3,115,258		1,158,479	1996	40 yrs.
7022 AC Skinner Parkway	Jacksonville, FL		—		706,934		—		3,572,340		853,981		3,425,294		4,279,274		1,510,930	1996	40 yrs.
11777 Central Highway	Jacksonville, FL		—		92,207		429,997		1,275,050		140,426		1,656,828		1,797,254		1,127,183	1985	40 yrs.
4345 Southpoint Parkway	Jacksonville, FL		—		—		—		8,791,159		418,093		8,373,065		8,791,159		2,765,051	1998	40 yrs.

112

								Costs
								Capitalized											Date of
								Subsequent			Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to			Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition			Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
7016 AC Skinner Parkway	Jacksonville, FL		—		597,181		—		2,373,250			602,633		2,367,799		2,970,431		1,140,862	1996	40 yrs.
7018 AC Skinner Parkway	Jacksonville, FL		—		840,996		—		4,694,026			846,461		4,688,561		5,535,022		2,186,102	1997	40 yrs.
7014 AC Skinner Parkway	Jacksonville, FL		—		574,198		—		3,580,008			780,486		3,373,720		4,154,206		1,385,190	1999	40 yrs.
6620 Southpoint Drive	Jacksonville, FL		—		614,602		4,267,477		1,017,166			614,602		5,284,642		5,899,245		1,858,105	1984	40 yrs.
7980 Bayberry Road	Jacksonville, FL		—		330,726		1,338,101		17,776			330,726		1,355,877		1,686,603		394,141	1978	40 yrs.
6600 Southpoint Parkway	Jacksonville, FL		—		998,432		4,055,727		828,152			1,002,704		4,879,607		5,882,311		1,750,059	1986	40 yrs.
6700 Southpoint Parkway	Jacksonville, FL		—		620,719		2,989,746		789,809			624,215		3,776,060		4,400,274		1,563,846	1987	40 yrs.
4801 Executive Park Court - 100	Jacksonville, FL		—		554,993		2,993,277		1,358,664			554,542		4,352,392		4,906,935		1,671,990	1990	40 yrs.
4801 Executive Park Court - 200	Jacksonville, FL		—		370,017		1,995,518		367,780			370,039		2,363,276		2,733,315		759,393	1990	40 yrs.
4810 Executive Park Court	Jacksonville, FL		—		369,694		3,045,639		1,007,513			370,039		4,052,807		4,422,846		1,281,897	1990	40 yrs.
6602 Executive Park Court - 100	Jacksonville, FL		—		388,519		2,095,293		299,475			388,541		2,394,745		2,783,287		790,611	1993	40 yrs.
6602 Executive Park Court - 200	Jacksonville, FL		—		296,014		1,596,347		453,476			296,032		2,049,805		2,345,837		645,669	1993	40 yrs.
6631 Executive Park Court - 100	Jacksonville, FL		—		251,613		1,356,849		525,120			251,627		1,881,955		2,133,582		791,232	1994	40 yrs.
6631 Executive Park Court - 200	Jacksonville, FL		—		406,561		2,195,070		274,915			407,043		2,469,503		2,876,546		817,142	1994	40 yrs.
4815 Executive Park Court - 100	Jacksonville, FL		—		366,317		1,975,393		409,677			366,339		2,385,048		2,751,387		876,448	1995	40 yrs.
4815 Executive Park Court - 200	Jacksonville, FL		—		462,522		2,494,397		512,344			462,549		3,006,713		3,469,263		1,049,949	1995	40 yrs.
4825 Executive Park Court	Jacksonville, FL		—		601,278		3,242,491		287,899			601,401		3,530,267		4,131,668		1,166,422	1996	40 yrs.
4820 Executive Park Court	Jacksonville, FL		—		555,173		2,693,130		777,785			555,213		3,470,875		4,026,088		1,111,648	1997	40 yrs.
6601 Executive Park Circle North	Jacksonville, FL		—		551,250		3,128,361		110,993			551,250		3,239,353		3,790,603		876,571	1992	40 yrs.
4901 Belfort Road	Jacksonville, FL		—		877,964		2,360,742		2,857,775			877,964		5,218,517		6,096,481		2,096,702	1986	40 yrs.
4875 Belfort Road	Jacksonville, FL		—		2,089,347		—		12,746,697			2,287,152		12,548,892		14,836,044		19,127	1998	40 yrs.
4899 Belfort Road	Jacksonville, FL		—		1,299,201		—		8,299,049			1,168,062		8,430,188		9,598,250		2,332,310	2000	40 yrs.
4905 Belfort Street	Jacksonville, FL		—		638,154		—		3,467,521			641,272		3,464,403		4,105,675		1,067,726	2000	40 yrs.
7251 Salisbury Road	Jacksonville, FL		—		—		—		3,567,820			662,559		2,905,261		3,567,820		883,202	2000	40 yrs.
10245 Centurion Parkway North	Jacksonville, FL		—		852,644		3,510,889		1,038,509			853,704		4,548,337		5,402,042		1,287,220	1996	40 yrs.
4887 Belfort Road	Jacksonville, FL		—		1,299,202				8,013,821			1,665,915		7,647,107		9,313,022		2,008,217	2002	40 yrs.
7255 Salisbury Road	Jacksonville, FL		—		392,060				2,975,677			680,766		2,686,971		3,367,737		700,627	2002	40 yrs.
5201 Gate Parkway	Jacksonville, FL		—		3,836,532		—		21,433,694			4,269,346		21,000,880		25,270,226		2,025,647	2005	40 yrs.
3200 Horizon Drive	King of Prussia, PA		—		928,637		—		7,121,324			1,210,137		6,839,824		8,049,961		2,905,022	1996	40 yrs.
440 East Swedesford Road	King of Prussia, PA		—		717,001		4,816,121		3,338,962			717,001		8,155,083		8,872,084		3,226,346	1988	40 yrs.
460 East Swedesford Road	King of Prussia, PA		—		705,317		4,737,487		4,321,549			705,317		9,059,036		9,764,353		2,487,896	1988	40 yrs.
151 South Warner Road	King of Prussia, PA		—		1,218,086		6,937,866		6,630,138			1,186,972		13,599,118		14,786,090		283,014	1980	40 yrs.
3604 Horizon Drive	King of Prussia, PA		—		397,178		—		1,628,625			350,874		1,674,929		2,025,803		750,858	1998	40 yrs.
3606 Horizon Drive	King of Prussia, PA		—		789,409		—		2,125,279			815,855		2,098,833		2,914,688		876,136	1997	40 yrs.
650 Swedesford Road	King of Prussia, PA		—		952,911		6,722,830		9,556,741			952,911		16,279,570		17,232,481		7,018,413	1971	40 yrs.
680 Swedesford Road	King of Prussia, PA		—		952,361		6,722,830		8,367,206			952,361		15,090,036		16,042,397		6,558,527	1971	40 yrs.
3600 Horizon Drive	King of Prussia, PA		—		236,432		1,856,252		784,645			236,432		2,640,897		2,877,328		758,733	1989	40 yrs.
3602 Horizon Drive	King of Prussia, PA		—		217,734		1,759,489		338,288			217,809		2,097,701		2,315,510		677,108	1989	40 yrs.
2700 Horizon Drive	King of Prussia, PA		—		764,370		—		4,242,628			867,815		4,139,183		5,006,998		1,403,069	1998	40 yrs.
2900 Horizon Drive	King of Prussia, PA		—		679,440		—		3,503,074			774,096		3,408,418		4,182,514		1,096,966	1998	40 yrs.
2500 Renaissance Boulevard	King of Prussia, PA		—		509,580		—		2,866,474			592,886		2,783,167		3,376,054		1,104,642	1999	40 yrs.
2300 Renaissance Boulevard	King of Prussia, PA		—		509,580		—		3,042,297			574,152		2,977,725		3,551,877		958,737	1999	40 yrs.
2100 Renaissance Boulevard	King of Prussia, PA		—		1,110,111		—		9,339,057			1,132,519		9,316,649		10,449,169		3,018,221	1999	40 yrs.
3400 Horizon Drive	King of Prussia, PA		—		776,496		3,139,068		1,276,655			776,496		4,415,723		5,192,219		1,336,234	1995	40 yrs.
2301 Renaissance Boulevard	King of Prussia, PA		—		1,645,246		—		30,063,879			4,581,649		27,127,475		31,709,124		6,028,262	2002	40 yrs.
2520 Renaissance Boulevard	King of Prussia, PA		—		1,020,000		—		5,015,045			978,402		5,056,643		6,035,045		2,170,675	1999	40 yrs.
2201 Renaissance Boulevard	King of Prussia, PA		—		—		—		18,888,377			2,413,514		16,474,863		18,888,377		3,917,910	2000	40 yrs.
2540 Renaissance Boulevard	King of Prussia, PA		—		—		—		1,625,497			274,341		1,351,156		1,625,497		439,087	2000	40 yrs.
2560 Renaissance Boulevard	King of Prussia, PA		—		—		—		3,729,254			649,792		3,079,462		3,729,254		983,905	2000	40 yrs.
170 South Warner Road	King of Prussia, PA		—		547,800		3,137,400		3,987,694			458,232		7,214,662		7,672,894		3,544,518	1980	40 yrs.
190 South Warner Road	King of Prussia, PA		—		552,200		3,162,600		1,647,906			461,909		4,900,797		5,362,706		2,466,986	1980	40 yrs.
3500 Horizon Drive	King of Prussia, PA		—		1,204,839		—		2,630,229			1,223,875		2,611,193		3,835,068		827,303	1996	40 yrs.
3000 Horizon Drive	King of Prussia, PA		—		1,191,449		—		2,309,358			946,703		2,554,103		3,500,806		688,183	1997	40 yrs.
3100 Horizon Drive	King of Prussia, PA		*		601,956		—		2,068,047			611,436		2,058,568		2,670,003		842,426	1995	40 yrs.
11425 State Highway 225	LaPorte, TX		—		975,974		3,409,036		8,956			977,542		3,416,424		4,393,966		274,812	2006	40 yrs.
11503 State Highway 225	LaPorte, TX		—		2,561,931		9,779,023		22,961			2,566,047		9,797,868		12,363,915		627,449	2006	40 yrs.
7528 Walker Way	Lehigh Valley, PA		—		893,441		—		5,510,455			779,330		5,624,567		6,403,897		581,674	2004	40 yrs.
8500 Willard Drive	Lehigh, PA		—		6,398,815		—		21,593,357			7,640,417		20,351,755		27,992,172		238,144	2004	40 yrs.
8301 Industrial Boulevard	Lehigh, PA		—		11,249,550		—		44,324,333			11,254,716		44,319,167		55,573,883		3,543,014	2005	40 yrs.
31700 Research Park Drive	Madison Heights, MI		—		373,202		1,824,721		(158,513	)		373,203		1,666,207		2,039,410		474,553	1988	40 yrs.
31811 Sherman Avenue	Madison Heights, MI		—		207,599		1,179,010		(152,186	)		207,599		1,026,824		1,234,423		315,809	1983	40 yrs.
1201 East Whitcomb Avenue	Madison Heights, MI		—		302,567		1,213,232		(167,324	)		302,567		1,045,908		1,348,475		338,473	1980	40 yrs.
1901 Summit Tower Boulevard	Maitland, FL		—		6,078,791		12,348,567		2,270,262			6,083,206		14,614,415		20,697,621		3,698,818	1998	40 yrs.
45-67 Great Valley Parkway	Malvern, PA		—		795,143		—		4,196,561			795,831		4,195,873		4,991,704		2,393,329	1974	40 yrs.
11,15 Great Valley Parkway	Malvern, PA		—		1,837,050		—		15,005,064			1,837,878		15,004,237		16,842,114		10,408,833	1986	40 yrs.
27-43 Great Valley Parkway	Malvern, PA		—		448,775		—		2,545,542			449,447		2,544,870		2,994,317		1,684,414	1977	40 yrs.
1 Country View Road	Malvern, PA		—		400,000		3,600,000		1,004,647			406,421		4,598,226		5,004,647		1,810,575	1982	40 yrs.
200 Chesterfield Parkway	Malvern, PA		—		495,893		2,739,093		649,407			588,384		3,296,009		3,884,393		2,113,705	1989	40 yrs.
50 Morehall Road	Malvern, PA		—		849,576		—		13,051,932			1,337,076		12,564,432		13,901,508		5,256,060	1997	40 yrs.
1 Great Valley Parkway	Malvern, PA		—		419,460		3,792,570		330,704			419,460		4,123,273		4,542,734		1,272,070	1982	40 yrs.
5 Great Valley Parkway	Malvern, PA		—		684,200		6,181,661		1,594,348			684,200		7,776,009		8,460,209		2,367,337	1983	40 yrs.
1001 Cedar Hollow Road	Malvern, PA		—		1,436,814		—		16,097,184			1,676,470		15,857,528		17,533,998		6,046,629	1998	40 yrs.
3 Country View Road	Malvern, PA		—		814,278		—		4,946,433			1,128,881		4,631,830		5,760,711		1,237,565	1998	40 yrs.
425 Technology Drive	Malvern, PA		—		191,114		—		2,112,927			321,473		1,982,568		2,304,041		846,015	1998	40 yrs.
375 Technology Drive	Malvern, PA		—		191,114		—		2,018,620			234,922		1,974,811		2,209,734		812,215	1998	40 yrs.
45 Liberty Boulevard	Malvern, PA		—		4,380,221		—		15,314,868			4,749,748		14,945,341		19,695,089		5,592,198	1999	40 yrs.

113

								Costs
								Capitalized										Date of
								Subsequent		Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to		Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition		Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
100 Chesterfield Parkway	Malvern, PA		—		1,320,625		—		6,714,624		1,451,139		6,584,110		8,035,249		2,703,488	1998	40 yrs.
600 Chesterfield Parkway	Malvern, PA		—		2,013,750		—		8,255,848		2,171,080		8,098,519		10,269,598		2,977,313	1999	40 yrs.
700 Chesterfield Parkway	Malvern, PA		—		2,013,750		—		8,216,674		2,158,337		8,072,087		10,230,424		2,945,440	1999	40 yrs.
18 Great Valley Parkway	Malvern, PA		—		394,036		3,976,221		99,539		397,293		4,072,504		4,469,796		1,029,148	1980	40 yrs.
11 Great Valley Parkway	Malvern, PA		—		496,297		—		3,226,924		708,331		3,014,890		3,723,221		810,169	2001	40 yrs.
40 Liberty Boulevard	Malvern, PA		—		4,241,137		17,737,090		2,182,842		4,241,167		19,919,901		24,161,068		6,188,393	1989	40 yrs.
2 West Liberty Boulevard	Malvern, PA		—		5,405,041		—		11,635,939		5,405,042		11,635,938		17,040,980		1,218,933	2003	40 yrs.
10 Great Valley Parkway	Malvern, PA		—		823,540		1,341,376		315,887		832,244		1,648,558		2,480,802		250,709	2003	40 yrs.
10, 20 Liberty Boulevard	Malvern, PA		—		724,058		—		5,760,414		724,846		5,759,626		6,484,472		2,818,957	1985	40 yrs.
420 Lapp Road	Malvern, PA		—		1,054,418		—		7,140,197		1,055,243		7,139,372		8,194,615		3,580,383	1989	40 yrs.
14 Lee Boulevard	Malvern, PA		—		664,282		—		6,022,257		643,892		6,042,647		6,686,539		3,107,281	1988	40 yrs.
500 Chesterfield Parkway	Malvern, PA		—		472,364		—		3,323,124		519,742		3,275,746		3,795,488		1,804,871	1988	40 yrs.
300-400 Chesterfield Parkway	Malvern, PA		—		937,212		—		5,742,100		1,012,843		5,666,469		6,679,312		2,967,422	1988	40 yrs.
40 Valley Stream Parkway	Malvern, PA		—		322,918		—		3,282,210		325,775		3,279,352		3,605,128		1,678,712	1987	40 yrs.
50 Valley Stream Parkway	Malvern, PA		—		323,971		—		3,204,468		323,792		3,204,647		3,528,439		1,436,712	1987	40 yrs.
20 Valley Stream Parkway	Malvern, PA		—		465,539		—		5,835,528		466,413		5,834,654		6,301,067		3,318,987	1987	40 yrs.
257-275 Great Valley Parkway	Malvern, PA		—		504,611		—		5,192,928		505,458		5,192,081		5,697,539		3,345,868	1983	40 yrs.
300 Technology Drive	Malvern, PA		—		368,626		—		1,344,816		374,497		1,338,945		1,713,442		769,673	1985	40 yrs.
277-293 Great Valley Parkway	Malvern, PA		—		530,729		—		2,452,813		531,534		2,452,008		2,983,542		1,480,904	1984	40 yrs.
311 Technology Drive	Malvern, PA		—		397,131		—		2,911,205		397,948		2,910,388		3,308,336		1,616,977	1984	40 yrs.
7 Great Valley Parkway	Malvern, PA		—		176,435		—		5,105,230		177,317		5,104,349		5,281,665		3,183,485	1985	40 yrs.
55 Valley Stream Parkway	Malvern, PA		—		215,005		—		4,393,160		215,818		4,392,348		4,608,165		2,300,673	1983	40 yrs.
65 Valley Stream Parkway	Malvern, PA		—		381,544		—		7,203,727		382,361		7,202,910		7,585,271		4,415,881	1983	40 yrs.
508 Lapp Road	Malvern, PA		—		331,392		—		2,021,104		332,216		2,020,280		2,352,496		1,333,384	1984	40 yrs.
10 Valley Stream Parkway	Malvern, PA		—		509,075		—		3,142,498		509,899		3,141,674		3,651,573		1,876,084	1984	40 yrs.
333 Phoenixville Pike	Malvern, PA		—		523,530		—		3,109,124		524,230		3,108,424		3,632,654		1,735,696	1985	40 yrs.
30 Great Valley Parkway	Malvern, PA		—		128,126		—		385,634		128,783		384,977		513,760		330,693	1975	40 yrs.
77-123 Great Valley Parkway	Malvern, PA		—		887,664		—		5,989,734		888,359		5,989,039		6,877,398		3,817,572	1978	40 yrs.
205 Great Valley Parkway	Malvern, PA		—		1,368,259		—		10,951,703		1,369,003		10,950,959		12,319,962		7,311,132	1981	40 yrs.
12,14,16 Great Valley Parkway	Malvern, PA		—		130,689		—		1,560,924		128,767		1,562,846		1,691,613		1,010,537	1982	40 yrs.
155 Great Valley Parkway	Malvern, PA		—		625,147		—		2,627,280		626,068		2,626,359		3,252,427		1,682,215	1981	40 yrs.
510 Lapp Road	Malvern, PA		—		356,950		—		926,587		357,751		925,786		1,283,537		615,963	1983	40 yrs.
60 Morehall Road	Malvern, PA		—		865,424		9,285,000		5,003,181		884,974		14,268,631		15,153,605		7,616,738	1989	40 yrs.
5 Country View Road	Malvern, PA		—		785,168		4,678,632		1,056,753		786,235		5,734,318		6,520,553		2,238,508	1985	40 yrs.
75 Great Valley Parkway	Malvern, PA		233,819		143,074		—		888,076		143,811		887,338		1,031,150		639,417	1977	40 yrs.
7550 Meridian Circle	Maple Grove, MN		—		513,250		2,901,906		480,768		513,250		3,382,673		3,895,923		924,902	1989	40 yrs.
701A Route 73 South	Marlton, NJ		—		264,387		3,772,000		4,136,671		271,743		7,901,315		8,173,058		3,869,216	1987	40 yrs.
701C Route 73 South	Marlton, NJ		—		84,949		1,328,000		630,335		96,161		1,947,123		2,043,284		787,244	1987	40 yrs.
400 Lippincott Drive	Marlton, NJ		—		69,402				3,794,883		317,799		3,546,486		3,864,285		1,160,762	1999	40 yrs.
406 Lippincott Drive	Marlton, NJ		—		321,455		1,539,871		1,152,052		327,554		2,685,824		3,013,378		1,208,728	1990	40 yrs.
301 Lippincott Drive	Marlton, NJ		—		1,069,837		4,780,163		1,627,277		1,069,838		6,407,440		7,477,277		2,579,480	1988	40 yrs.
303 Lippincott Drive	Marlton, NJ		—		1,069,837		4,780,163		3,061,402		1,069,838		7,841,565		8,911,402		3,095,840	1988	40 yrs.
901 Route 73	Marlton, NJ		—		334,411		2,733,314		822,958		334,411		3,556,271		3,890,683		1,303,790	1985	40 yrs.
404 Lippincott Drive	Marlton, NJ		—		131,896		—		1,809,487		131,896		1,809,487		1,941,383		732,345	1997	40 yrs.
402 Lippincott Drive	Marlton, NJ		—		131,896		—		2,096,558		131,896		2,096,558		2,228,454		785,592	1997	40 yrs.
75 Brookfield Oaks Drive	Mauldin, SC		—		419,731		—		2,476,356		430,909		2,465,178		2,896,087		276,134	2003	40 yrs.
65 Brookfield Oaks Drive	Mauldin, SC		—		557,174		—		2,745,259		506,318		2,796,116		3,302,434		273,241	2004	40 yrs.
7800 N. 113th Street	Milwaukee, WI		—		1,711,964		6,847,857		417,823		1,711,964		7,265,680		8,977,644		2,144,918	1991	40 yrs.
11950 W. Lake Park Drive	Milwaukee, WI		—		391,813		2,340,118		597,682		394,938		2,934,675		3,329,613		962,505	1986	40 yrs.
11400 W. Lake Park Drive	Milwaukee, WI		—		439,595		2,357,904		352,646		443,101		2,707,044		3,150,145		678,300	1986	40 yrs.
11425 W. Lake Park Drive	Milwaukee, WI		—		382,256		2,350,619		978,198		385,305		3,325,768		3,711,073		1,301,393	1987	40 yrs.
11301 W. Lake Park Drive	Milwaukee, WI		—		614,477		2,626,456		123,888		619,465		2,745,357		3,364,821		679,473	1987	40 yrs.
11900 W. Lake Park Drive	Milwaukee, WI		—		347,853		2,396,887		1,077,279		350,628		3,471,392		3,822,020		1,219,789	1987	40 yrs.
11414 West Park Place	Milwaukee, WI		—		234,443				10,745,623		491,531		10,488,536		10,980,067		3,129,496	2001	40 yrs.
11520 West Calumet Road	Milwaukee, WI		—		341,698		1,527,548		78,494		341,698		1,606,042		1,947,740		372,203	1995	40 yrs.
12100 West Park Place	Milwaukee, WI		—		534,470		3,239,389		572,084		532,370		3,813,573		4,345,943		1,107,320	1984	40 yrs.
11100 West Liberty Drive	Milwaukee, WI		—		1,800,000				7,537,760		1,801,024		7,536,736		9,337,760		1,330,833	2003	40 yrs.
11050 West Liberty Drive	Milwaukee, WI		—		—		—		3,816,745		914,760		2,901,985		3,816,745		175,374	2005	40 yrs.
4700 Nathan Lane North	Minneapolis, MN		—		1,501,308		8,446,083		225,056		1,501,308		8,671,139		10,172,447		2,049,711	1996	40 yrs.
4600 Nathan Lane	Minneapolis, MN		—		1,063,558				6,683,083		1,038,197		6,708,444		7,746,641		2,184,719	2002	40 yrs.
12501 & 12701 Whitewater Drive	Minnegonka, MN		—		2,175,209		3,948,085		7,480,997		2,177,953		11,426,338		13,604,291		1,523,808	1986	40 yrs.
5600 & 5610 Rowland Road	Minnetonka, MN		—		828,650		7,399,409		2,154,498		829,263		9,553,293		10,382,557		3,528,882	1988	40 yrs.
5400-5500 Feltl Road	Minnetonka, MN		—		883,895		7,983,345		2,288,449		883,895		10,271,794		11,155,689		3,272,429	1985	40 yrs.
3400 Lakeside Drive	Miramar, FL		—		2,022,153		11,345,881		1,661,289		2,022,153		13,007,169		15,029,323		3,866,622	1990	40 yrs.
3450 Lakeside Drive	Miramar, FL		—		2,022,152		11,357,143		2,623,700		2,022,152		13,980,843		16,002,994		4,453,379	1990	40 yrs.
3350 SW 148th Avenue	Miramar, FL		—		2,960,511		—		19,988,526		2,980,689		19,968,347		22,949,037		5,995,017	2000	40 yrs.
324 Park Knoll Drive	Morrisville, NC		*		1,449,092		4,424,932		239,301		1,449,450		4,663,875		6,113,325		221,707	2007	40 yrs.
619 Distribution Drive	Morrisville, NC		*		1,031,430		5,655,167		406,756		1,031,685		6,061,668		7,093,353		273,517	2007	40 yrs.
627 Distribution Drive	Morrisville, NC		*		1,061,370		5,152,110		231,852		1,061,632		5,383,700		6,445,332		226,746	2007	40 yrs.
701 Distribution Drive	Morrisville, NC		*		1,300,889		5,313,226		206,727		1,301,211		5,519,632		6,820,842		230,736	2007	40 yrs.
330 Fellowship Road	Mount Laurel, NJ		—		3,730,570		—		15,782,675		3,758,270		15,754,975		19,513,245		118,386	2006	40 yrs.
300 Fellowship Road	Mt Laurel, NJ		—		—		—		7,350,519		1,098,904		6,251,616		7,350,519		838,722	2004	40 yrs.
302 Fellowship Road	Mt Laurel, NJ		—		1,512,120		—		2,931,388		539,060		3,904,448		4,443,507		356,761	2001	40 yrs.
3001 Leadenhall Road	Mt Laurel, NJ		—		1,925,719		191,390		10,965,396		1,936,489		11,146,016		13,082,505		1,731,986	2003	40 yrs.
350 Fellowship Road	Mt Laurel, NJ		—		2,960,159		1,449,611		4,555,353		2,970,687		5,994,436		8,965,123		397,053	2006	40 yrs.
4001 Leadenhall Road	Mt. Laurel, NJ		—		3,207,885		391,167		18,894,592		2,784,694		19,708,950		22,493,644		4,148,410	2002	40 yrs.

114

								Costs
								Capitalized										Date of
								Subsequent		Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to		Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition		Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
OPERATING PROPERTIES
3000 Atrium Way	Mt. Laurel, NJ		—		500,000		4,500,000		5,049,174		512,018		9,537,156		10,049,174		4,500,007	1987	40 yrs.
11000, 15000 Commerce Parkway	Mt. Laurel, NJ		—		310,585		4,394,900		622,498		311,950		5,016,033		5,327,983		2,405,135	1985	40 yrs.
12000, 14000 Commerce Parkway	Mt. Laurel, NJ		—		361,800		3,285,817		968,639		362,855		4,253,401		4,616,256		1,746,377	1985	40 yrs.
16000, 18000 Commerce Parkway	Mt. Laurel, NJ		—		289,700		2,512,683		1,335,052		290,545		3,846,890		4,137,435		1,379,385	1985	40 yrs.
1300 Route 73 North	Mt. Laurel, NJ		—		449,400		3,074,850		2,152,136		450,558		5,225,828		5,676,386		1,991,748	1988	40 yrs.
6000 Commerce Parkway	Mt. Laurel, NJ		—		234,151		2,022,683		902,135		234,151		2,924,818		3,158,969		1,102,498	1985	40 yrs.
7000 Commerce Parkway	Mt. Laurel, NJ		—		260,014		2,236,684		428,261		260,014		2,664,945		2,924,959		947,137	1984	40 yrs.
8000 Commerce Parkway	Mt. Laurel, NJ		—		234,814		1,995,098		468,864		234,814		2,463,962		2,698,776		726,982	1983	40 yrs.
9000 Commerce Parkway	Mt. Laurel, NJ		—		286,587		2,474,820		999,069		286,587		3,473,888		3,760,476		1,235,450	1983	40 yrs.
1000 Briggs Road	Mt. Laurel, NJ		—		288,577		2,546,537		1,481,895		288,577		4,028,432		4,317,009		1,762,710	1986	40 yrs.
1020 Briggs Road	Mt. Laurel, NJ		—		494,334		—		3,166,630		569,184		3,091,781		3,660,964		1,022,257	1999	40 yrs.
2000 Crawford Place	Mt. Laurel, NJ		—		310,831		2,797,744		2,918,905		310,831		5,716,649		6,027,480		2,538,858	1986	40 yrs.
5000 Dearborn Court	Mt. Laurel, NJ		—		1,057,763		4,191,827		1,651,610		1,057,763		5,843,437		6,901,200		1,628,440	1988	40 yrs.
1001 Briggs Road	Mt. Laurel, NJ		—		701,705		3,505,652		2,139,294		701,705		5,644,946		6,346,652		2,407,293	1986	40 yrs.
1015 Briggs Road	Mt. Laurel, NJ		—		356,987		—		3,673,175		470,659		3,559,503		4,030,162		1,075,140	2000	40 yrs.
17000 Commerce Parkway	Mt. Laurel, NJ		—		144,515				3,457,069		144,515		3,457,069		3,601,584		962,620	2001	40 yrs.
1025 Briggs Road	Mt. Laurel, NJ		278,931		430,990		3,714,828		1,234,492		430,990		4,949,320		5,380,310		1,830,207	1987	40 yrs.
6 Terry Drive	Newtown, PA		—		622,029		2,228,851		1,023,137		622,205		3,251,811		3,874,016		1,175,053	1981	40 yrs.
550-590 Hale Avenue	Oakdale, MN		—		765,535		3,488,754		666,032		766,390		4,153,931		4,920,320		1,174,506	1996	40 yrs.
1879 Lamont Avenue	Odenton, MD		—		1,976,000		8,099,579		2,469,160		2,011,030		10,533,709		12,544,739		1,157,212	2004	40 yrs.
350 Winmeyer Avenue	Odenton, MD		—		1,778,400		7,289,165		1,867,935		1,809,927		9,125,573		10,935,500		958,092	2004	40 yrs.
9600 Satellite Boulevard	Orlando, FL		—		252,850		1,297,923		62,116		252,850		1,360,039		1,612,889		410,096	1989	40 yrs.
9700 Satellite Boulevard	Orlando, FL		—		405,362		1,146,546		350,999		405,362		1,497,545		1,902,907		472,552	1989	40 yrs.
1902 Cypress Lake Drive	Orlando, FL		—		523,512		3,191,790		1,027,641		538,512		4,204,431		4,742,943		1,349,433	1989	40 yrs.
9550 Satellite Boulevard	Orlando, FL		—		574,831		—		2,330,526		587,319		2,318,038		2,905,357		716,478	1999	40 yrs.
10511 & 10611 Satellite Boulevard	Orlando, FL		—		517,554		2,568,186		487,613		522,991		3,050,362		3,573,353		1,013,101	1985	40 yrs.
1400-1440 Central Florida Parkway	Orlando, FL		—		518,043		2,561,938		862,155		518,043		3,424,093		3,942,136		918,802	1962	40 yrs.
2216 Directors Row	Orlando, FL		—		453,918		2,572,202		30,979		453,918		2,603,181		3,057,099		686,270	1998	40 yrs.
2400 South Lake Orange Drive	Orlando, FL		—		385,964		—		2,409,102		642,427		2,152,639		2,795,066		498,346	2001	40 yrs.
6923 Lee Vista Boulevard	Orlando, FL		—		903,701		—		3,790,657		830,953		3,863,405		4,694,358		218,655	2006	40 yrs.
6501 Lee Vista Boulevard	Orlando, FL		—		903,701				5,560,142		925,671		5,538,172		6,463,843		1,024,755	2001	40 yrs.
2416 Lake Orange Drive	Orlando, FL		—		535,964				3,175,219		704,800		3,006,382		3,711,182		951,877	2002	40 yrs.
10771 Palm Bay Drive	Orlando, FL		—		664,605				2,362,814		685,383		2,342,035		3,027,419		416,722	2001	40 yrs.
10003 Satellite Boulevard	Orlando, FL		—		680,312		2,120,754		1,241,828		680,312		3,362,582		4,042,894		662,327	2003	40 yrs.
1090 Gills Drive	Orlando, FL		—		878,320		2,558,833		1,371,034		878,320		3,929,867		4,808,187		529,509	2003	40 yrs.
2202 Taft-Vineland Road	Orlando, FL		—		—		—		6,631,110		1,283,713		5,347,397		6,631,110		1,072,811	2004	40 yrs.
South Center Land-Phase II	Orlando, FL		—		838,853		—		4,084,539		767,953		4,155,440		4,923,392		298,526	2006	40 yrs.
7315 Kingspointe Parkway	Orlando, FL		—		1,931,697		6,388,203		2,135,046		1,932,004		8,522,943		10,454,946		1,287,196	2004	40 yrs.
2351 Investors Row	Orlando, FL		—		2,261,924		7,496,249		411,516		2,263,211		7,906,478		10,169,689		790,763	2004	40 yrs.
1950 Summit Park Drive	Orlando, FL		—		2,573,700		17,478,646		587,603		2,583,667		18,056,282		20,639,949		1,772,310	2005	40 yrs.
1958 Summit Park Drive	Orlando, FL		—		2,573,961		11,206,937		8,841,420		2,583,216		20,039,102		22,622,318		2,031,969	2005	40 yrs.
6200 Lee Vista Boulevard	Orlando, FL		—		1,423,584		6,399,510		65,322		1,435,301		6,453,115		7,888,416		543,837	2006	40 yrs.
7022 TPC Drive	Orlando, FL		—		1,443,510		6,845,559		572,022		1,457,286		7,403,806		8,861,092		625,097	2006	40 yrs.
7100 TPC Drive	Orlando, FL		—		1,431,489		7,948,341		576,378		1,445,807		8,510,400		9,956,207		576,967	2006	40 yrs.
7101 TPC Drive	Orlando, FL		—		1,553,537		5,301,499		777,653		1,570,863		6,061,826		7,632,689		436,743	2006	40 yrs.
851 Gills Drive	Orlando, FL		—		332,992		—		2,559,105		373,500		2,518,597		2,892,097		28,215	2006	40 yrs.
950 Gills Drive	Orlando, FL		—		443,989		—		2,496,959		464,800		2,476,148		2,940,948		28,432	2006	40 yrs.
1000 Gills Drive	Orlando, FL		—		415,906		—		2,700,326		435,400		2,680,832		3,116,232		36,577	2006	40 yrs.
8751 Skinner Court	Orlando, FL		—		1,009,532		—		5,452,988		1,075,437		5,387,083		6,462,520		50,479	2008	40 yrs.
2256 Taft-Vineland Road	Orlando, FL		—		467,296		—		2,494,666		825,673		2,136,290		2,961,963		237,098	2005	40 yrs.
8801 Tinicum Boulevard	Philadelphia, PA		—		2,474,031		—		43,598,952		125,087		45,947,896		46,072,983		15,252,548	1997	40 yrs.
3 Franklin Plaza	Philadelphia, PA		—		2,483,144		—		32,150,134		2,514,519		32,118,759		34,633,278		7,807,092	1999	40 yrs.
4751 League Island Boulevard	Philadelphia, PA		—		992,965		331,924		6,753,197		1,022,081		7,056,006		8,078,087		989,840	2003	40 yrs.
1 Crescent Drive	Philadelphia, PA		—		567,280		—		14,379,278		347,892		14,598,666		14,946,558		917,104	2004	40 yrs.
4775 League Island Boulevard	Philadelphia, PA		—		891,892		—		5,757,514		366,982		6,282,425		6,649,406		176,510	2006	40 yrs.
4410 E. Cotton Center Boulevard	Phoenix, AZ		—		4,758,484		10,559,563		4,222,270		4,765,172		14,775,144		19,540,317		224,278	2007	40 yrs.
4750 S. 44th Place	Phoenix, AZ		—		3,756,307		8,336,400		3,624,432		3,761,587		11,955,552		15,717,139		175,068	2007	40 yrs.
4435 E. Cotton Center Boulevard	Phoenix, AZ		—		1,910,584		1,954,020		2,167,338		1,911,045		4,120,898		6,031,943		127,251	2007	40 yrs.
4207 E. Cotton Center Boulevard	Phoenix, AZ		—		1,409,908		4,680,808		1,096,836		1,410,248		5,777,305		7,187,552		415,229	2007	40 yrs.
4217 E. Cotton Center Boulevard	Phoenix, AZ		—		4,831,925		10,045,599		2,015,623		4,833,088		12,060,059		16,893,147		598,710	2007	40 yrs.
4425 E. Cotton Center Boulvard	Phoenix, AZ		*		7,318,457		24,549,401		28,556		7,318,457		24,577,957		31,896,413		1,212,322	2007	40 yrs.
4415 E. Cotton Center Boulevard	Phoenix, AZ		*		1,749,957		3,767,213		6,137		1,749,957		3,773,350		5,523,308		260,492	2007	40 yrs.
4405 E. Cotton Center Boulevard	Phoenix, AZ		*		2,646,318		9,697,439		9,441		2,646,318		9,706,880		12,353,198		442,023	2007	40 yrs.
4313 E. Cotton Center Boulevard	Phoenix, AZ		*		3,895,539		16,724,283		1,399,749		3,895,539		18,124,032		22,019,571		913,104	2007	40 yrs.
4303 E. Cotton Center Boulvard	Phoenix, AZ		*		2,619,964		9,675,711		11,076		2,619,964		9,686,787		12,306,751		485,652	2007	40 yrs.
9801 80th Avenue	Pleasant Prairie, WI		—		1,692,077		7,934,794		337,495		1,689,726		8,274,640		9,964,366		2,019,026	1994	40 yrs.
2250 Hickory Road	Plymouth Meeting, PA		—		1,015,851		9,175,555		2,985,528		1,032,507		12,144,428		13,176,935		3,779,952	1985	40 yrs.
2905 Northwest Boulevard	Plymouth, MN		—		516,920		4,646,342		1,932,535		516,920		6,578,877		7,095,797		2,540,236	1983	40 yrs.
2800 Campus Drive	Plymouth, MN		—		395,366		3,554,512		1,165,443		395,366		4,719,955		5,115,321		1,724,869	1985	40 yrs.
2955 Xenium Lane	Plymouth, MN		—		151,238		1,370,140		508,272		151,238		1,878,412		2,029,650		739,900	1985	40 yrs.
2920 Northwest Boulevard	Plymouth, MN		—		392,026		3,433,678		661,796		384,235		4,103,265		4,487,500		1,329,439	1997	40 yrs.
14630-14650 28th Avenue North	Plymouth, MN		—		198,205		1,793,422		782,928		198,205		2,576,350		2,774,555		890,678	1978	40 yrs.
2800 Northwest Boulevard	Plymouth, MN		—		1,934,438		10,952,503		536,220		1,934,438		11,488,723		13,423,161		3,263,618	1995	40 yrs.
9600 54th Avenue	Plymouth, MN		—		332,317		3,077,820		1,020,792		332,317		4,098,612		4,430,929		1,432,032	1998	40 yrs.
1500 SW 5th Court	Pompano Beach, FL		—		972,232		3,892,085		404,585		972,232		4,296,671		5,268,902		1,230,523	1957	40 yrs.
1651 SW 5th Court	Pompano Beach, FL		—		203,247		811,093		129,136		203,247		940,230		1,143,477		336,929	1990	40 yrs.

115

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

116

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

117

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

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

118

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

								Costs
								Capitalized										Date of
								Subsequent		Gross Amount Carried at End of Period						Accumulated		Construction	Depreciable
				Initial Cost				to		Land and		Building and		Total		Depreciation		or	life
Project	Location	Encumbrances		Land		Building		Acquisition		Improvements		Improvements		12/31/2008		12/31/08		Acquisition	(years)
LAND HELD FOR DEVELOPMENT
Perryman Road Land	Aberdeen, MD		—		12,052,635		—		274,379		12,327,014		—		12,327,014		—	2000	N/A
2 Womack Drive Land	Annapolis, MD		—		5,796,667		—		6,444		5,803,111		—		5,803,111		—	2005	N/A
Boca Colannade Yamato Road	Boca Raton, FL		—		2,039,735		—		566,124		2,605,859		—		2,605,859		—	2001	N/A
Flying Cloud Drive Land	Eden Pairie, MN		—		2,051,631		—		3,701		2,055,331		—		2,055,331		—	1997	N/A
Camelback 303 Business Center Land	Goodyear, AZ		—		16,857,556		—		3,216,158		20,073,714		—		20,073,714		—	2005	N/A
Pleasant Ridge Road Land	Greensboro, NC		—		564,535		—		2,895,957		3,460,492		—		3,460,492		—	2008	N/A
Southchase Business Park Land	Greenville, SC		—		1,308,325		—		705,094		2,013,419		—		2,013,419		—	2007	N/A
Caliber Ridge Ind. Park Land	Greer, SC		—		2,297,492		—		3,562,592		5,860,084		—		5,860,084		—	2007	N/A
Hunters Green Land	Hagerstown, MD		—		5,489,586		—		8,334,639		13,824,225		—		13,824,225		—	1999	N/A
Lakefront Plaza II Land	Hampton, VA		229,953		138,101		—		101,061		239,162		—		239,162		—	2007	N/A
Ridge Road Land	Hanover, MD		—		3,371,183		—		439,543		3,810,727		—		3,810,727		—	2007	N/A
Mendenhall Land	High Point, NC		—		1,757,675		—		1,645,453		3,403,128		—		3,403,128		—	1998	N/A
Piedmond Centre Land	High Point, NC		—		913,276		—		757,687		1,670,963		—		1,670,963		—	1995	N/A
Commonwealth Corporate Center Land	Horsham, PA		—		3,043,938		—		25,160		3,069,098		—		3,069,098		—	1998	N/A
Beltway 8 @Bammel Bus Park Land	Houston, TX		—		1,072,634		—		13,656		1,086,290		—		1,086,290		—	2006	N/A
Central Green Land — Tract 5	Houston, TX		—		4,169,183		—		580,110		4,749,293		—		4,749,293		—	2000	N/A
Greens Crossing Land	Houston, TX		—		2,476,892		—		14,369		2,491,261		—		2,491,261		—	1995	N/A
Rankin Road Land	Houston, TX		—		5,756,865		—		94,054		5,850,919		—		5,850,919		—	1996	N/A
Hollister Beltway 8 Land	Houston, TX		—		6,282,232		—		88,510		6,370,741		—		6,370,741		—	2006	N/A
Noxell Land	Hunt Valley, MD		—		2,040,690		—		1,173		2,041,863		—		2,041,863		—	2007	N/A
Liberty Business Park Land	Jacksonville, FL		—		456,269		—		82,345		538,614		—		538,614		—	1987	N/A
7024 AC Skinner Parkway	Jacksonville, FL		—		751,448		—		73,504		824,952		—		824,952		—	2007	N/A
Belfort Road	Jacksonville, FL		—		492,908		—		87,304		580,212		—		580,212		—	2006	N/A
Salisbury Road Land	Jacksonville, FL		—		1,402,337		—		198,904		1,601,241		—		1,601,241		—	2005	N/A
Skinner Land Parcel B	Jacksonville, FL		—		2,295,790		—		1,230,516		3,526,306		—		3,526,306		—	2008	N/A
Imeson Road Land	Jacksonville, FL		—		4,153,948		—		158,922		4,312,870		—		4,312,870		—	2000	N/A
Kent County, UK	Kent County, UK		—		—		—		14,577,381		14,577,381		—		14,577,381		—	1999	N/A
Commodore Business Park	Logan, NJ		—		792,118		—		671,146		1,463,264		—		1,463,264		—	1998	N/A
Quarry Ridge Land	Malvern, PA		—		4,774,994		—		5,850,801		10,625,795		—		10,625,795		—	2007	N/A
Park Place South Land	Milwaukee, WI		—		1,290,032		—		2,230,261		3,520,293		—		3,520,293		—	2006	N/A
Monarch Towne Center Land	Mirarar, FL		—		6,085,337		—		413,926		6,499,264		—		6,499,264		—	2006	N/A
South 27th Street Land	Oak Creek, WI		—		2,169,232		—		2,685,212		4,854,444		—		4,854,444		—	2001	N/A
Beachline Industrial Park Land	Orlando, FL		—		365,230		—		—		365,230		—		365,230		—	2006	N/A
JFK & Arch Parking Lots/Land (West)	Philadelphia, PA		—		4,792,286		—		4,147,633		8,939,919		—		8,939,919		—	2007	N/A
Cotton Center Land	Phoenix, AZ		—		4,449,689		—		40		4,449,729		—		4,449,729		—	1997	N/A
Eastport VIII	Richmond, VA		—		382,698		—		3,325		386,023		—		386,023		—	2006	N/A
Eastport IX	Richmond, VA		—		211,627		—		3,325		214,952		—		214,952		—	1998	N/A
IRS Distribution Ctr Land	Richmond, VA		—		12,981		—		—		12,981		—		12,981		—	2007	N/A
Woodlands Center Land	Sandston, VA		—		148,314		—		19,354		167,668		—		167,668		—	2007	N/A
Northsight Land (LPLP)	Scottsdale, AZ		—		6,176,464		—		2,204,597		8,381,061		—		8,381,061		—	2001	N/A
Old Scotland Road Land	Shippensburg, PA		—		8,322,686		—		2,562,070		10,884,757		—		10,884,757		—	2005	N/A
Bridgeway II Land	Suffolk, VA		—		603,391		—		2,022,814		2,626,205		—		2,626,205		—	1995	N/A
Suffolk Land	Suffolk, VA		—		2,715,714		—		675,966		3,391,680		—		3,391,680		—	2005	N/A
6119 W. Linebaugh Avenue	Tampa, FL		—		180,136		—		30,500		210,635		—		210,635		—	2005	N/A
Tampa Triangle Land	Tampa, FL		—		10,358,826		—		1,125,564		11,484,390		—		11,484,390			2006	N/A
Renaissance Park Land	Tampa, FL		—		1,995,375		—		308,575		2,303,950		—		2,303,950		—	2007	N/A
Subtotal Land Held for Development		$	229,953	$	150,902,343	$	—	$	58,648,168	$	209,550,512	$	—	$	209,550,512	$	—
Total All Properties		$	73,261,535	$	932,107,751	$	1,806,581,435	$	2,789,841,489	$	1,022,947,345	$	4,505,583,831	$	5,528,531,176	$	982,114,170

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

119

SCHEDULE III

LIBERTY PROPERTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
(In thousands)

A summary of activity for real estate and accumulated depreciation is as follows:

	Year Ended December 31,
	2008			2007			2006
REAL ESTATE:
Balance at beginning of year	$	5,765,409		$	5,101,280		$	4,649,302
Additions		330,371			939,322			820,012
Disposition of property		(567,248	)		(275,193	)		(368,034	)
Balance at end of year	$	5,528,532		$	5,765,409		$	5,101,280
ACCUMULATED DEPRECIATION:
Balance at beginning of year	$	858,671		$	782,750		$	712,786
Depreciation expense		140,925			126,852			120,947
Disposition of property		(17,482	)		(50,931	)		(50,983	)
Balance at end of year	$	982,114		$	858,671		$	782,750

120

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

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company’s management, with the participation of its Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures, as of the end of the period covered by this report, were functioning effectively to provide reasonable assurance that information required to be disclosed by the Company in its reports filed or submitted under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC’s rules and forms and (ii) accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar function, as appropriate to allow timely decisions regarding required disclosure.

Management’s Annual Reports on Internal Control Over Financial Reporting

Management’s Annual Reports on Internal Control Over Financial Reporting, which appear on pages 41 and 83, are incorporated by reference herein.

Attestation Reports of the Registered Public Accounting Firm

The Attestation Reports of the Registered Public Accounting Firm, which appear on pages 42, 43, 84, and 85, are incorporated by reference herein.

Changes in Internal Control Over Financial Reporting

There were no changes in the Company’s internal control over financial reporting during the quarter ended December 31, 2008 that have materially affected or are reasonable likely to materially affect the Company’s internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

None.

121

PART III

ITEM 10. TRUSTEES, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by Item 10 shall be included in the Proxy Statement to be filed relating to the Company’s 2009 Annual Meeting of Shareholders and is incorporated herein by reference.

ITEM 11. EXECUTIVE COMPENSATION

The information required by Item 11 shall be included in the Proxy Statement to be filed relating to the Company’s 2009 Annual Meeting of Shareholders and is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENTAND RELATED SHAREHOLDER MATTERS

The information required by Item 12 shall be included in the Proxy Statement to be filed relating to the Company’s 2009 Annual Meeting of Shareholders and is incorporated herein by reference.

Securities Authorized for Issuance Under Equity Compensation Plans

The information required by Item 12 shall be included in the Proxy Statement to be filed relating to the Company’s 2009 Annual Meeting of Shareholders and is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND TRUSTEE INDEPENDENCE

The information required by Item 13 shall be included in the Proxy Statement to be filed relating to the Company’s 2009 Annual Meeting of Shareholders and is incorporated herein by reference.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by Item 14 shall be included in the Proxy Statement to be filed relating to the Company’s 2009 Annual Meeting of Shareholders and is incorporated herein by reference.

122

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

The following consolidated financial statements of Liberty Property Trust and Liberty Property Limited Partnership are included in Item 8.

1. REPORTS OF ERNST & YOUNG LLP, INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM AND CONSOLIDATED FINANCIAL STATEMENTS

Management’s Annual Report on Internal Control Over Financial Reporting — Liberty Property Trust

Reports of Independent Registered Public Accounting Firm — Liberty Property Trust

Financial Statements — Liberty Property Trust

Balance Sheets:

Liberty Property Trust Consolidated as of December 31, 2008 and 2007

Statements of Operations:

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

Statements of Shareholders’ Equity:

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

Statements of Cash Flows:

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

Notes to Consolidated Financial Statements — Liberty Property Trust

Management’s Annual Report on Internal Control Over Financial Reporting — Liberty Property Limited Partnership

Reports of Independent Registered Public Accounting Firm — Liberty Property Limited Partnership

Financial Statements — Liberty Property Limited Partnership

Balance Sheets:

Liberty Property Limited Partnership Consolidated as of December 31, 2008 and 2007

Statements of Operations:

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

Statements of Owners’ Equity:

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

Statements of Cash Flows:

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

Notes to Consolidated Financial Statements — Liberty Property Limited Partnership

2. FINANCIAL STATEMENT SCHEDULES:

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

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

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

123

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

124

3. EXHIBITS

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

EXHIBIT NO.	DESCRIPTION
2.1	Agreement and Plan Merger, dated as of July 23, 2007, by and among Liberty Property Trust, Liberty Property Limited Partnership, Liberty Acquisition LLC, Republic Property Trust and Republic Property Limited Partnership. (Incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K of the Registrants, filed with the Securities and Exchange Commission on July 24, 2007).
3.1.1	Amended and Restated Declaration of Trust of the Trust (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants’ Current Report on Form 8-K filed with the Commission on June 25, 1997 (the “June 1997 Form 8-K”)).
3.1.2	Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust Relating to Designation, Preferences, and Rights of Series A Junior Participating Preferred Shares of the Trust (Incorporated by reference to Exhibit 3.1.3 filed with the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 3l, 1997).
3.1.3	Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 9.25% Series B Cumulative Redeemable Preferred Shares of Beneficial Interest (Incorporated by reference to Exhibit 3.1.2 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 1999 (the “Second Quarter 1999 Form 10-Q”)).
3.1.4	Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 7.625% Series D Cumulative Redeemable Preferred Shares of Beneficial Interest (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2002 (the “Second Quarter 2002 Form 10-Q”)).
3.1.5	Articles of Amendment to the Amended and Restated Declaration of Trust of the Trust, filed with the State Department of Assessments and Taxation of Maryland on June 21, 2004 (Incorporated by reference to Exhibit 3.1 with Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2004 (the “Second Quarter 2004 Form 10-Q”)).
3.1.6	Restatement of the Amended Restated Declaration of Trust of the Trust, filed with the State Department of Assessments and Taxation of Maryland on June 21, 2004 (Incorporated by reference to Exhibit 3.2 to the Second Quarter 2004 Form 10-Q).
3.1.7	Articles Supplementary, as filed with the State Department of Assessments and Taxation of Maryland on September 1, 2004 (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Commission on September 2, 2004 (the “September 2, 2004 Form 8-K”))
3.1.8	Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 7.00% Series E Cumulative Redeemable Preferred Shares of Beneficial Interest (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Commission on June 17, 2005 (the “June 17, 2005 Form 8-K”)).
3.1.9	Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 6.65% Series F Cumulative Redeemable Preferred Shares of Beneficial Interest (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Commission on June 30, 2005 (the “June 30, 2005 Form 8-K”)).
3.1.10	Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 6.65% Series F Cumulative Redeemable Preferred Shares of Beneficial Interest (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Commission on August 24, 2005.)

125

EXHIBIT NO.	DESCRIPTION
3.1.11	Articles Supplementary to the amended and Restated Declaration of Trust of the Trust relating to the 6.70% Series G Cumulative Redeemable Shares of Beneficial Interest (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Commission on December 18, 2006 (the “December 18, 2006 Form 8-K”)).
3.1.12	Articles Supplementary to the Amended and Restated Declaration of Trust of the Trust relating to the 7.40% Series H Cumulative Redeemable Preferred Partnership Interests (Incorporated by reference to Exhibit 3(i) to the Current Report on Form 8-K of the Registrants, filed with the Commission on August 23, 2007 (the “August 23, 2007 Form 8-K”)).
3.1.13	Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership, dated as of October 22, 1997 (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 1997 (the “Third Quarter 1997 Form 10-Q”)).
3.1.14	First Amendment to Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership (Incorporated by reference to Exhibit 3.1.1 to the Second Quarter 1999 Form 10-Q).
3.1.15	Second Amendment to Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership (Incorporated by reference to Exhibit 3.1.2 to the First Quarter 2000 Form 10-Q).
3.1.16	Third Amendment to Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership (Incorporated by reference to Exhibit 3.1.2 to the Second Quarter Form 2002 10-Q).
3.1.17	Fourth Amendment to the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership (Incorporated by reference to Exhibit 10 to the September 2, 2004 Form 8-K).
3.1.18	Fifth Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 10 to the June 17, 2005 8-K).
3.1.19	Sixth Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 10 to the June 30, 2005 8-K).
3.1.20	Amendment No. 1 to the Sixth Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 10 to the Current Report on Form 8-K of the Registrants, filed with the Commission on August 24, 2005.)
3.1.21	Amendment No. 2 to the Sixth Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 10 to the Current Report on Form 8-K of the Registrants, filed with the Commission on December 23, 2005.)
3.1.22	Seventh Amendment to the Second Amended and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 10 to the December 18, 2006 Form 8-K).
3.1.23	Eighth Amendment to the Second Amendment and Restated Agreement of Limited Partnership of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 10 to the August 23, 2007 Form 8-K).
3.1.24*	Amended and Restated Schedule A to the Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership.

126

EXHIBIT NO.	DESCRIPTION
3.1.25	Liberty Property Trust First Amended and Restated By-Laws of the Trust, as Amended on December 6, 2007 (Incorporated by reference to Exhibit 3.1 filed with the Current Report on Form 8-K filed with the Commission on December 12, 2007)
4.1	Indenture (the “First Indenture”), dated as of August 14, 1997, between the Operating Partnership, as Obligor, and The First National Bank of Chicago (“First Chicago”), as Trustee (Incorporated by reference to Exhibit 10.1 filed with the Third Quarter 1997 Form 10-Q).
4.2	First Supplemental Indenture, dated as of August 14, 1997, between the Operating Partnership, as Issuer, and First Chicago, as Trustee, supplementing the First Indenture and relating to $100,000,000 principal amount of the 7.10% Senior Notes due 2004 and $100,000,000 principal amount of the 7.25% Senior Notes due 2007 of the Operating Partnership (Incorporated by reference to Exhibit 10.2 filed with the Third Quarter 1997 Form 10-Q).
4.3	Senior Indenture (the “Second Indenture”), dated as of October 24, 1997, between the Operating Partnership, as Obligor, and First Chicago, as Trustee (Incorporated by reference to Exhibit 10.3 filed with the Third Quarter 1997 Form 10-Q).
4.4	First Supplemental Indenture, dated as of October 24, 1997, between the Operating Partnership, as Issuer, and First Chicago, as Trustee, supplementing the Second Indenture and relating to the Fixed Rate and Floating Rate Medium-Term Notes due Nine Months or More from Date of Issue of the Operating Partnership (Incorporated by reference to Exhibit 10.4 filed with the Third Quarter 1997 Form 10-Q).
4.5	Second Supplemental Indenture, dated as of January 12, 1998, between the Operating Partnership, as Issuer, and First Chicago, as Trustee, supplementing the Second Indenture, and relating to the Fixed Rate and Floating Rate Medium-Term Notes due Nine Months or more from Date of Issue of the Operating Partnership (Incorporated by reference to Exhibit 4.1 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 1998 (the “First Quarter 1998 Form 10-Q”)).
4.6	Third Supplemental Indenture, dated as of April 20, 1999, between the Operating Partnership, as Issuer, and the First National Bank of Chicago, as Trustee, supplementing the Second Indenture and relating to the $250,000,000 principal amount of 7.75% Senior Notes, due 2009 of the Operating Partnership (Incorporated by reference to Exhibit 4 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 1999 (the “First Quarter 1999 Form 10-Q”)).
4.7	Fourth Supplemental Indenture, dated as of July 26, 2000, between the Operating Partnership, as Issuer, and Bank One Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between the Operating Partnership, as Obligor, and Bank One Trust Company, N.A. (as successor to the First National Bank of Chicago), as Trustee, and relating to $200,000,000 principal amount of 8.5% Senior Notes due 2010 of the Operating Partnership (Incorporated by reference to Exhibit 4 to the Second Quarter 2000 Form 10-Q).
4.8	Fifth Supplemental Indenture, dated as of March 14, 2001, between the Operating Partnership, as Issuer, and Bank One Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between the Operating Partnership, as Obligor, and Bank One Trust Company, N.A. (as successor to the First National Bank of Chicago), as Trustee, and relating to $250,000,000 principal amount of 7.25% Senior Notes due 2011 of the Operating Partnership (Incorporated by reference to Exhibit 4.10 filed with the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 31, 2000).

127

EXHIBIT NO.	DESCRIPTION
4.9	Sixth Supplemental Indenture, dated as of August 22, 2002, between Liberty Property Limited Partnership, as Issuer, and Bank One Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and Bank One Trust Company, N.A. (as successor to the First National Bank of Chicago), as Trustee, and relating to $150,000,000 principal amount of 6.375% Senior Notes due 2012 of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 3.1.1 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2002 (the “Third Quarter 2002 Form 10-Q”)).
4.10	Seventh Supplemental Indenture, dated as of August 10, 2004, between Liberty Property Limited Partnership, as Issuer, and Bank One Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and Bank One Trust Company, National Association. (as successor to the First National Bank of Chicago), as Trustee, and relating to $200,000,000 principal amount of 5.65% Senior Notes due 2012 of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 4.1.2 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2004 (the “Third Quarter 2004 Form 10-Q”)).
4.11	Eighth Supplemental Indenture, dated as of March 1, 2005, between Liberty Property Limited Partnership, as Issuer, and Bank One Trust Company, as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and Bank One Trust Company, National Association (as successor to the First National Bank of Chicago), as Trustee, and relating to $300,000,000 principal amount of 5.125% Senior Notes due 2015 of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 4.2 filed with the Registrants’ Current Report on Form 8-K/A filed with the Commission on March 1, 2005 (the “March 2005 Form 8-K”)).
4.12	Ninth Supplemental Indenture, dated as of December 18, 2006, between Liberty Property Limited Partnership, as Issuer, and The Bank of New York Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and The Bank of New York Trust Company, N.A., (as successor to J.P. Morgan Trust Company, National Association and the First National Bank of Chicago), as Trustee, and relating to $300,000,000 principal amount of 5.50% Senior Notes due 2016 of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 4.13 to the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 31, 2006).
4.13	Tenth Supplemental Indenture, dated as of September 25, 2007, between Liberty Property Limited Partnership, as Issuer, and The Bank of New York Trust Company, N.A., as Trustee, supplementing the Senior Indenture, dated as of October 24, 1997, between Liberty Property Limited Partnership, as Obligor, and The Bank of New York Trust Company, N.A., (as successor to J.P. Morgan Trust Company, National Association and the First National Bank of Chicago), as Trustee, and relating to $300,000,000 principal amount of 6.625% Senior Notes due 2017 of Liberty Property Limited Partnership (Incorporated by reference to Exhibit 4.1 to the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2007).
4.14	Note, Relating to the Issuance by the Operating Partnership, on January 22, 1998, of $75 Million Principal Amount of its 6.375% Medium-Term Notes due 2013, Putable/Callable 2003 (Incorporated by reference to Exhibit 4.2 filed with the First Quarter 1998 Form 10-Q).
4.15	Note, Relating to the Issuance by the Operating Partnership, on January 23, 1998, of $100 Million Principal Amount of its 7.50% Medium-Term Notes due 2018 (Incorporated by reference to Exhibit 4.3 filed with the First Quarter 1998 Form 10-Q).
4.16	Note, Relating to the Issuance by the Operating Partnership, on June 5, 1998, of $100 Million Principal Amount of its 6.60% Medium-Term Notes due 2002 (Incorporated by reference to Exhibit 4 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 1998 (the “Second Quarter 1998 Form 10-Q”)).

128

EXHIBIT NO.	DESCRIPTION
4.17	Note, Relating to the Issuance by the Operating Partnership on November 24, 1998, of $20 Million Principal Amount of its 8.125% Medium-Term Notes due January 15, 2009 (Incorporated by reference to Exhibit 4.11 filed with the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 31, 1998).
10.1	Liberty Property Trust Amended and Restated Share Incentive Plan as amended effective May 17, 2007 (Incorporated by reference to Appendix A to the Registrant’s Definitive Proxy Statement for the Annual Meeting of Shareholders held on May 17, 2007, filed with the Commission on April 17, 2007.)
10.2	Contribution Agreement (Incorporated by reference to Exhibit 10.5 filed with the Form S-11).
10.3	Amended and Restated Limited Partnership Agreements of Pre-existing Pennsylvania Partnerships (Incorporated by reference to Exhibit 10.6 filed with the Form S-11).
10.4	Agreement of Sale for the Acquisition Properties (Incorporated by reference to Exhibit 10.7 filed with the Form S-11).
10.5	Option Agreement and Right of First Offer (Incorporated by reference to Exhibit 10.8 filed with the Form S-11).
10.6	Form of Indemnity Agreement (Incorporated by reference to Exhibit 10.9 filed with the Form S-11).
10.7	Contribution Agreement among the Trust, the Operating Partnership and the Contributing Owners described therein, related to the Lingerfelt Properties (Incorporated by reference to Exhibit 10.1 filed with the Registrants’ Current Report on Form 8-K filed with the Commission on March 3, 1995).
10.8	Amended and Restated Credit Agreement, dated as of December 22, 2005, by and among the Operating Partnership, the Trust, certain affiliated co-borrowers, with Bank of America, N.A. as Administrative Agent, JPMorgan Chase Bank, N.A., as Syndication Agent, Wachovia Bank, National Association, SunTrust Bank and Citizens Bank of Pennsylvania, as Documentation Agents, PNC Bank, National Association and Wells Fargo Bank, National Association, as Managing Agents, Banc of America Securities LLC and J.P. Morgan Securities Inc., as Joint Lead Arrangers and Joint Bookrunners, and the lenders a party thereto (Incorporated by reference to Exhibit 10.8 filed with Registrants’ Annual Report on Form 10-K for the year ended December 31, 2006.
10.9*	Liberty Property Trust — Amended Management Severance Plan.
10.10	Liberty Property Trust — Employee Stock Purchase Plan (Incorporated by reference to Exhibit 10.14 filed with the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2000).
10.11	Description of Compensation of Non-Employee Trustees (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of the Registrants filed with the Commission on February 23, 2005.)
10.12	Liberty Property Trust 2008 Long-Term Incentive Plan (Incorporated by reference to Exhibit 10.1 filed with the Registrant’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2008 (the “First Quarter 2008 Form 10-Q”)).
10.13	Form of Restricted Share Grant under the Liberty Property Trust Amended and Restated Share Incentive Plan. (Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of the Registrants filed with the Commission on February 24, 2005 (the “February 24, 2005 8-K”)).
10.14	Form of Option Grant Agreement under the Liberty Property Trust Amended and Restated Share Incentive Plan (Incorporated by reference to Exhibit 10.2 filed with the First Quarter 2008 Form 10-Q).

129

EXHIBIT NO.	DESCRIPTION
10.15	Amended and Restated Limited Partnership of Liberty/Commerz 1701 JFK Boulevard Limited Partnership, dated as of April 11, 2006, by and among Liberty Property Philadelphia Corporation IV East, as general partner, and the Operating Partnership and 1701 JFK Boulevard Philadelphia, L.P. as limited partners (Incorporated by reference to Exhibit 10.3 filed with the Registrants’ Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2006 (the “Second Quarter 2006 Form 10-Q”)).
10.16	NOI Support Agreement, dated as of April 11, 2006, by Liberty Property Limited Partnership in favor of Liberty/Commerz 1701 JFK Boulevard, L.P. and 1701 JFK Boulevard Philadelphia, L.P. (Incorporated by reference to Exhibit 10.4 filed with the Registrants’ Second Quarter 2006 Form 10-Q).
10.17	Completion and Payment Agreement and Guaranty, dated as of April 11, 2006, by the Operating Partnership for the benefit of 1701 JFK Boulevard Philadelphia, L.P. and Liberty/Commerz 1701 JFK Boulevard L.P. (Incorporated by reference to Exhibit 10.5 filed with the Registrants’ Second Quarter 2006 Form 10-Q).
10.18+	Agreement of Limited Partnership of Liberty Washington, L.P. by and between Liberty Washington Venture, LLC and New York State Common Retirement Fund dated as of October 4, 2007 (Incorporated by reference to Exhibit 10.18 filed with the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 31, 2007).
10.19+	Contribution Agreement among New York State Common Retirement Fund and Liberty Property Limited Partnership and Liberty Washington, L.P. dated October 4, 2007 (Incorporated by reference to Exhibit 10.19 filed with the Registrants’ Annual Report on Form 10-K for the fiscal year ended December 31, 2007).
10.20	Equity Distribution Agreement, dated December 18, 2008, by and among Liberty Property Trust, Liberty Property Limited Partnership and Citigroup Global Markets Inc. (Incorporated by reference to Exhibit 1.1 filed with the Registrants’ Current Report on Form 8-K filed with the Commission on December 18, 2008).
12*	Statement re: Computation of Ratios.
21*	Subsidiaries.
23.1*	Consent of Ernst & Young LLP relating to the Trust.
23.2*	Consent of Ernst & Young LLP relating to the Operating Partnership.
31.1*	Certifications of the Chief Executive Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
31.2*	Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
31.3*	Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
31.4*	Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.

130

EXHIBIT NO.	DESCRIPTION
32.1*	Certifications of the Chief Executive Officer of Liberty Property Trust required under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
32.2*	Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
32.3*	Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
32.4*	Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) Sd
99.1*	Portions of the Proxy Statement for the Liberty Property Trust 2008 Annual Meeting of Shareholders.

*	Filed herewith
+	Confidential treatment has been requested with respect to portions of this exhibit pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

131

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.

	LIBERTY PROPERTY TRUST
Date: February 27, 2009	By:	/s/ WILLIAM P. HANKOWSKY
	WILLIAM P. HANKOWSKY
	CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER

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.

/s/ WILLIAM P. HANKOWSKY William P. Hankowsky	Chairman of the Board of Trustees, President and Chief Executive Officer (Principal Executive Officer)	February 27, 2009
/s/ GEORGE J. ALBURGER, JR. George J. Alburger, Jr.	Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)	February 27, 2009
/s/ M. LEANNE LACHMAN M. Leanne Lachman	Trustee	February 27, 2009
/s/ FREDERICK F. BUCHHOLZ Frederick F. Buchholz	Trustee	February 27, 2009
/s/ J. ANTHONY HAYDEN J. Anthony Hayden	Trustee	February 27, 2009
/s/ DAVID L. LINGERFELT David L. Lingerfelt	Trustee	February 27, 2009
/s/ JOHN A. MILLER, CLU John A. Miller, CLU	Trustee	February 27, 2009
/s/ STEPHEN B. SIEGEL Stephen B. Siegel	Trustee	February 27, 2009
/s/ THOMAS C. DELOACH, JR. Thomas C. DeLoach, Jr.	Trustee	February 27, 2009
/s/ DANIEL P. GARTON Daniel P. Garton	Trustee	February 27, 2009
/s/ JOSE A. MEJIA Jose A. Mejia	Trustee	February 27, 2009

132

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.

	LIBERTY PROPERTY LIMITED PARTNERSHIP
	BY:		Liberty Property Trust
Date: February 27, 2009	By:	/s/ WILLIAM P. HANKOWSKY
	WILLIAM P. HANKOWSKY
	CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER

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.

/s/ WILLIAM P. HANKOWSKY William P. Hankowsky	Chairman of the Board of Trustees, President and Chief Executive Officer (Trustee of the General Partner)	February 27, 2009
/s/ GEORGE J. ALBURGER, JR. George J. Alburger, Jr.	Executive Vice President and Chief Financial Officer (Trustee of the General Partner)	February 27, 2009
/s/ M. LEANNE LACHMAN M. Leanne Lachman	Trustee of the General Partner	February 27, 2009
/s/ FREDERICK F. BUCHHOLZ Frederick F. Buchholz	Trustee of the General Partner	February 27, 2009
/s/ J. ANTHONY HAYDEN J. Anthony Hayden	Trustee of the General Partner	February 27, 2009
/s/ DAVID L. LINGERFELT David L. Lingerfelt	Trustee of the General Partner	February 27, 2009
/s/ JOHN A. MILLER, CLU John A. Miller, CLU	Trustee of the General Partner	February 27, 2009
/s/ STEPHEN B. SIEGEL Stephen B. Siegel	Trustee of the General Partner	February 27, 2009
/s/ THOMAS C. DELOACH, JR. Thomas C. DeLoach, Jr.	Trustee of the General Partner	February 27, 2009
/s/ DANIEL P. GARTON Daniel P. Garton	Trustee of the General Partner	February 27, 2009
/s/ JOSE A. MEJIA Jose A. Mejia	Trustee of the General Partner	February 27, 2009

133

EXHIBIT INDEX

Exhibit No.	Description
3.1.24	Amended and Restated Schedule A to the Second Restated and Amended Agreement of Limited Partnership of the Operating Partnership.
10.9	Liberty Property Trust — Amended Management Severance Plan
12	Statement re: Computation of Ratios.
21	Subsidiaries.
23.1	Consent of Ernst & Young LLP relating to the Trust.
23.2	Consent of Ernst & Young LLP relating to the Operating Partnership.
31.1	Certifications of the Chief Executive Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
31.2	Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
31.3	Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
31.4	Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.
32.1	Certifications of the Chief Executive Officer of Liberty Property Trust required under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
32.2	Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
32.3	Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)

134

Exhibit No.	Description
32.4	Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.
99.1	Portions of the Proxy Statement for the Liberty Property Trust 2008 Annual Meeting of Shareholders.

135

EX-3.1.24

Schedule A — December 31, 2008

Exhibit 3.1.24

SCHEDULE ‘A’

Liberty Property Limited Partnership
Partnership Interests
As of December 31, 2008

	Number of
	Partnership
Limited Partners	Interests		%
Balitsaris, Peter		58,542		0.0569	%
Carr, Clai		115,000		0.1118	%
Castorina, John		14,491		0.0141	%
Denny, Joseph		260,250		0.2530	%
Felix, Jill		195,043		0.1896	%
Fenza, Robert		195,043		0.1896	%
Fitzgerald, Ward		14,491		0.0141	%
Gildea, Larry		93,319		0.0907	%
Goldschmidt, Robert		22,895		0.0223	%
Hagan, Michael		14,491		0.0141	%
Hammers, David		244,426		0.2376	%
Kiel, Bob		14,491		0.0141	%
Kline, Earl		19,128		0.0186	%
Lutz, Jim		37,312		0.0363	%
Mazzerralli, James		14,491		0.0141	%
Messaros, Sharron		7,245		0.0070	%
Morrissey, Mary Beth		14,491		0.0141	%
Price, Leslie		82,668		0.0804	%
Reichert, Joseph		27,242		0.0265	%
Marital Trust for Susannah Rouse		460,418		0.4476	%
Trust for Congdon Children		95,347		0.0927	%
Trust for Hammers Children		95,348		0.0927	%
Trust for Mary Rouse		13,621		0.0132	%
Trust for Anne Rouse		13,621		0.0132	%
Trust for Rouse Younger Children		81,726		0.0794	%
Trust for Laurie Hammers		5,506		0.0054	%
Weitzmann, Mike		42,312		0.0411	%
Liberty Special Purpose Trust		10,574		0.0103	%
Thomas, Rebecca		8,076		0.0079	%
Trust for J. Ryan Lingerfelt		15,625		0.0152	%
Trust for Justin M. Lingerfelt		15,625		0.0152	%
Trust for Daniel K. Lingerfelt		15,625		0.0152	%
Trust for Catherine E. Lingerfelt		15,625		0.0152	%
Lingerfelt, Alan T.		317,500		0.3086	%
Lingerfelt, L. Harold		164,375		0.1598	%
Lingerfelt, David L.		30,674		0.0298	%

Schedule A — December 31, 2008

SCHEDULE ‘A’

Liberty Property Limited Partnership
Partnership Interests — Continued
As of December 31, 2008

	Number of Partnership
	Interests		%
Limited Partners
Morris U. Ferguson Family Trust		6,000		0.0058	%
Lingerfelt, Carl C.		10,900		0.0106	%
Wright, Murray H.		7,500		0.0073	%
Latimer, Erle Marie		12,500		0.0122	%
Samet, Norman G.		14,013		0.0136	%
Mann, Bernard		14,012		0.0136	%
Stender, Stewart R.		57,613		0.0560	%
Rouse & Associates Maryland Partnership		20,000		0.0194	%
Helwig, A. Carl		169,737		0.2185	%
Sunday, James J.		79,348		0.0771	%
Walters, Charles J.		100,723		0.1514	%
Doyle, Margaret A.		19,380		0.0188	%
Stanford Baratz Revocable Trust		9,044		0.0088	%
F. Greek Logan Properties, LLC		33,682		0.0327	%
Virginia Acquisition I, LLC		228,144		0.2218	%
David Mandelbaum		228,144		0.2218	%
Nathan Mandelbaum		228,144		0.2218	%
Preferred Limited Partners
Belcrest Realty Corporation		250,000		N/A
Belwater Realty Corp.		1,260,000		N/A
Belbrook Realty Corporation		1,540,000		N/A
Clearfork Realty Corporation (6/21/07)		750,000		N/A
Montebello Realty Corp. 2002		400,000		N/A
GSEP Realty Corp. 2005		1,000,000		N/A
GSEP2006 Realty Corp.		540,000		N/A
Belmar Realty Corporation (8/21/07)		600,000		N/A
Belport Realty Corporation (8/21/07)		400,000		N/A
Belrose Realty Corporation (8/21/07)		1,000,000		N/A
Belshire Realty Corporation (8/21/07)		500,000		N/A
Belterra Realty Corporation (8/21/07)		600,000		N/A
Beldore Realty Corporation (8/21/07)		900,000		N/A
General Partner
Liberty Property Trust	GP			95.9215	%
Total Ownership				100.0000	%

General Partner — The partnership units for Liberty Property Trust have not been reflected

Schedule A — December 31, 2008

because there is no conversion of units to shares by the general partner.

EX-10.9

Exhibit 10.9

LIBERTY PROPERTY TRUST —

MANAGEMENT SEVERANCE PLAN

TABLE OF CONTENTS

		Page
section 1	Purpose		A-1
section 2	Definitions		A-1
2.1	“Applicable Multiplier”		A-1
2.2	“Board of Trustees”		A-1
2.3	A “Change of Control”		A-1
2.4	“Claimant”		2
2.5	“Common Shares”		2
2.6	“Company”		2
2.7	“Compensation Committee”		2
2.8	“Effective Date”		2
2.9	“Disability”		3
2.10	“Employee”		3
2.11	“Eligible Bonus”		3
2.12	“Extended Leave of Absence”		3
2.13	“Good Reason”		3
2.14	“Liberty Property Limited Partnership”		3
2.15	“Liberty Property Trust”		3
2.16	“Notice of Termination”		3
2.17	“Paid Time Off”		3
2.18	“Pay”		3
2.19	“Plan”		4
2.20	“Severance Pay”		4
2.21	“Subsidiary”		4
2.22	“Termination Date”		4
2.23	“Willful Misconduct”		4
2.24	“Year of Pay”		4
section 3	Eligibility		4
3.1	Eligible Employees		4
3.2	Disability or Extended Leave of Absence		4
3.3	Willful Misconduct		5
3.4	Good Reason		5

TABLE OF CONTENTS

		Page
3.5	Termination of Employment		6
3.6	Disqualification		6
section 4	Severance Benefit Amount		7
4.1	Severance Pay		7
4.2	Increases to Severance Pay		8
4.3	Unemployment Compensation		8
4.4	Sickness; Disability		8
4.5	Reduction of Severance Pay		8
4.6	Section 280G(b) of Code		9
(a)	8
(c)	9
4.7	Further Actions		10
section 5	Distribution of Benefits		10
5.1	Payment		10
5.2	Deceased Employees		10
section 6	Plan Administration		10
6.1	Compensation Committee		11
6.2	Determinations Conclusive		11
6.3	Disputes		11
6.4	Payment of Fees		11
section 7	Plan Modification or Termination		12
7.1	Automatic Termination		12
7.2	Modifications and Amendments		12
7.3	Determination of Claims		12
section 8	General Provisions		13
8.1	No Right to Employment		13
8.2	Vacancies on Compensation Committee		13
8.3	Assignments		13
8.4	Plan Unfunded		13
8.5	No Set Off; No Mitigation		13
8.6	Governing Law		14

TABLE OF CONTENTS

		Page
8.7	Welfare Plan		14

SECTION 1

PURPOSE

     The Company considers it essential to its best interests to foster the optimum performance of its management employees. The Company recognizes the possibility that a Change in Control of the Company or one or more Subsidiaries may occur, or that the Company may engage in certain other transactions which may affect its management employees, and that such possibility, and the uncertainty and questions which it may raise, may result in the distraction of management to the detriment of the Company.

     In order to encourage management employees to maintain their continued attention and dedication to their duties and responsibilities, the Company has adopted this Management Severance Plan.

SECTION 2

DEFINITIONS

     As hereinafter used:

     2.1 “Applicable Multiplier” with respect to each Employee, which shall be either 1.99 or 2.99, shall be set forth opposite the name of such Employee on Exhibit “A.”

     2.2 “Board of Trustees” means the Board of Trustees of Liberty Property Trust.

     2.3 A “Change of Control” shall be deemed to have occurred upon the earliest to occur of the following events:

               (a) the date on which the shareholders of the Company (or the Board of Trustees, if shareholder action is not required) approve a plan or other arrangement pursuant to which the Company will be dissolved or liquidated, or

               (b) the date on which the transactions contemplated by a definitive agreement to sell or otherwise dispose of substantially all of the assets of the Company are consummated, other than a transaction in which the holders of the Common Shares immediately prior to the transaction will have at least fifty percent (50%) of the voting power of the acquiring entity’s voting securities immediately after such transaction (without regard to such holders’ ownership of such acquiring entity’s voting securities immediately before or contemporaneously with such transaction), which voting securities are to be held by such holders immediately following such transaction in substantially the same proportion among themselves as such holders’ ownership of the Common Shares immediately before such transaction, or

               (c) the first date on which (i) the transactions contemplated by a definitive agreement to merge or consolidate the Company with or into the other constituent entity, or to merge such other entity with or into the Company, have been

A-1

TABLE OF CONTENTS
(continued)

Page

consummated, other than, in any such case, a merger or consolidation of the Company in which the holders of the Common Shares immediately prior to the merger or consolidation will have at least fifty percent (50%) of the voting power of the surviving entity’s voting securities immediately after such merger or consolidation (without regard to such holders’ ownership of such acquiring entity’s voting securities immediately before or contemporaneously with such merger or consolidation), which voting securities are to be held by such holders immediately following such merger or consolidation in substantially the same proportion among themselves as such holders’ ownership of the Common Shares immediately before such merger or consolidation, and (ii) members of the Board of Trustees prior to the consummation of such merger or consolidation cease to constitute a majority of the Board of Trustees, or

               (d) the date on which any entity, person or group, within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act of 1934, as amended (other than the Company or any Subsidiary or any employee benefit plan sponsored or maintained by the Company or any Subsidiary), shall have become the beneficial owner of, or shall have obtained voting control over, more than twenty percent (20%) of the outstanding Common Shares (without regard to any contractual or other restriction on the conversion or other exchange of securities into or for Common Shares), or

               (e) the first day after the date on which the Plan is effective when a majority of the members of the Board of Trustees shall have been members of the Board of Trustees for less than two (2) years, unless the nomination for election of each new trustee who was not a trustee at the beginning of such two (2)-year period was approved by a vote of at least two-thirds of the trustees then still in office who were trustees at the beginning of such period.

     2.4 “Claimant” has the meaning set forth in Section 6.3.

     2.5 “Common Shares” means the Common Shares of Beneficial Interest, $0.001 par value, of the Company and any other securities evidencing the common equity beneficial interest in the Company.

     2.6 “Company” means Liberty Property Trust and/or Liberty Property Limited Partnership, and any successor in interest thereto.

     2.7 “Compensation Committee” means the current compensation committee of the Board of Trustees, and/or any other individuals appointed to such committee or substituted for the individuals named above by the Board of Trustees prior to any Change of Control. All members of the Compensation Committee must be members of such committee prior to the time a Change of Control occurs.

     2.8 “Effective Date” of the Plan is December 13, 2001.

2

TABLE OF CONTENTS
(continued)

Page

     2.9 “Disability” has the meaning set forth in Section 3.2.

     2.10 “Employee” means a person:

               (a) whose name is listed in Exhibit “A” hereto, as such Exhibit may be amended or supplemented by the Compensation Committee from time to time, or who has been designated in writing by the Compensation Committee to participate in the Plan (even if such person’s name is not listed in Exhibit “A” hereto); and

               (b) who is employed by the Company at the time of a change of a Change of Control. The term “Employee” specifically excludes any person (a) who is receiving severance pay at the time of the Change in Control; or (b) who signed an agreement pursuant to which his or her employment will terminate in the future on a date certain; or (c) is party to an agreement which excludes him or her from participation in the Plan.

     2.11 “Eligible Bonus” means the largest annual incentive bonus earned by an eligible Employee over the five (5)-year period preceding a Change of Control, excluding all commissions and all bonuses awarded by the Company other than on an annual basis (such as one-time grants of restricted stock).

     2.12 “Extended Leave of Absence” has the meaning set forth in Section 3.2.

     2.13 “Good Reason” has the meaning set forth in Section 3.4.

     2.14 “Liberty Property Limited Partnership” means Liberty Property Limited Partnership, a Pennsylvania limited partnership.

     2.15 “Liberty Property Trust” means Liberty Property Trust, a Maryland real estate investment trust.

     2.16 “Notice of Termination” has the meaning set forth in Section 3.5.

     2.17 “Paid Time Off” means time when, in accordance with the regular payroll practices and procedures applicable immediately preceding the Change of Control, the Employee is entitled to receive remuneration without reporting for work.

     2.18 “Pay” means the base salary of an eligible Employee at his or her stated weekly, monthly or annual rate as of the Employee’s Termination Date, or, if a higher amount, as of the date of the Change of Control. “Pay” does not include overtime pay, bonuses of any kind, commissions, incentive pay or any other remuneration. A “Year of Pay” shall be calculated in accordance with the regular payroll practices and procedures applicable immediately preceding the Change of Control.

3

TABLE OF CONTENTS
(continued)

Page

     2.19 “Plan” means this Management Severance Plan as set forth herein, and as may be amended from time to time.

     2.20 “Severance Pay” is a payment made to an eligible Employee pursuant to Section 3.1. All Severance Pay due to an eligible Employee must be paid to the eligible Employee within two (2) years after the date that the first Severance Pay payment is made to such Employee.

     2.21 “Subsidiary” means Liberty Property Limited Partnership and each other subsidiary of Liberty Property Trust.

     2.22 “Termination Date” means the date upon which the Employee’s employment ceases with the Company or any Subsidiary, as the case may be.

     2.23 “Willful Misconduct” has the meaning set forth in Section 3.3.

     2.24 “Year of Pay” has the meaning set forth in Section 2.17.

SECTION 3

ELIGIBILITY

     3.1 Eligible Employees. An Employee shall be eligible to receive Severance Pay if and only if all of the following conditions are met (and the Employee is not disqualified from eligibility pursuant to Section 3.2):

               (a) The Employee is an Employee of the Company or any Subsidiary after the Effective Date of the Plan;

               (b) The Employee is employed by the Company at the time a Change of Control occurs; and

               (c) The Employee is terminated from employment within two (2) years after the Change of Control described in Section 3.1(b) occurs, unless such termination is: (i) as a result of such Employee’s death, or such Employee’s Disability or Extended Leave of Absence in accordance with Section 3.2, (ii) as a result of such Employee’s Willful Misconduct or (iii) by the Employee other than for Good Reason. In the event an individual’s employment is terminated for any reason prior to the occurrence of a Change of Control, such individual shall not be entitled to any benefits under the Plan by virtue of such Change of Control.

     3.2 Disability or Extended Leave of Absence. If, as a result of an Employee’s incapacity due to physical or mental illness (a “Disability”), or as a result of any other leave of absence (an “Extended Leave of Absence”), the Employee shall have been

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absent from the full-time performance of his or her duties for twelve (12) consecutive months, the Employee shall not be entitled to any benefits under the Plan.

     3.3 Willful Misconduct. Termination of the Employee’s employment for “Willful Misconduct” shall mean termination:

               (a) Upon the continued failure by the Employee to substantially perform his or her duties, which failure the Employee fails to cure (other than any such failure resulting from incapacity due to physical or mental illness, Disability or an Extended Leave of Absence or the Employee’s termination of his or her employment for Good Reason) within ten (10) days after a written demand for substantial performance is delivered to the Employee by the Company or the Subsidiary by which he or she is employed, which demand describes in reasonable detail the manner in which the Company or such Subsidiary believes that the Employee has not substantially performed his or her duties; or

               (b) The willful engaging by the Employee in conduct which is materially injurious to the Company and/or any Subsidiary, monetarily or otherwise. For purposes of this Section 3.3, no act, or failure to act, on the Employee’s part shall be deemed “willful” unless done, or omitted to be done, by the Employee in bad faith and without reasonable belief that his or her action or omission was in, or not opposed to, the best interests of the Company and/or any Subsidiary.

               (c) Notwithstanding the foregoing, the Employee shall not be deemed to have been terminated for Willful Misconduct unless and until there shall have been delivered to the Employee a copy of a written determination of the Compensation Committee issued pursuant to a meeting of the Compensation Committee (after reasonable notice to the Employee and an opportunity for the Employee, together with his or her counsel, to be heard before the Compensation Committee) finding that in the good faith opinion of the Compensation Committee the Employee was guilty of conduct constituting Willful Misconduct, as set forth in this Section 3.3, and describing such conduct in reasonable detail.

     3.4 Good Reason. The Employee shall be entitled to terminate his or her employment for Good Reason. For purposes of this Section 3.4 “Good Reason” shall mean, without the Employee’s express written consent, the occurrence after a Change in Control of any of the following circumstances:

               (a) a material diminution in the Employee’s base salary;

               (b) a material diminution in the authority, duties or responsibilities held by the Employee;

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               (c) a material diminution in the authority, duties, or responsibilities of the person or body to whom the Employee is required to report;

               (d) a material change in the geographic location at which the Employee must perform services, which for purposes of this Agreement means the requirement that Employee must perform services at a location that is 50 miles from the current executive offices of the Company, other than on travel reasonably required to carry out Employee’s obligations under this Agreement; or

               (e) any material breach of this Agreement by the Company.

Provided, however, that a termination by Employee for Good Reason shall be effective only if (i) the Employee has provided a notice of termination to the Company within 90 days after the initial existence of the event constituting Good Reason that an event constituting Good Reason has occurred, (ii) within 30 days following the delivery of such notice of termination by Employee to the Company, the Company has failed to cure the circumstances giving rise to Good Reason, and (iii) Employee’s termination of employment is effective within 30 days following the end of the 30-day cure period set forth above.

     3.5 Termination of Employment. After the occurrence of a Change of Control, any purported termination of the Employee’s employment by the Company or by the Employee shall be communicated by written Notice of Termination to the other party. “Notice of Termination” shall mean a notice that shall indicate the specific termination provision in the Plan relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Employee’s employment under the provision so indicated. Any Notice of Termination to the Company shall be directed to the Compensation Committee. All Notices of Termination shall be sent (i) by certified or registered mail and shall be deemed received three (3) business days after the date of mailing; (ii) by Federal Express or similar overnight courier and shall be deemed received one (1) business day after delivery to Federal Express or similar overnight courier; or (iii) by personal service and shall be deemed received on the same day as service.

     3.6 Disqualification. An Employee may not receive Severance Pay if any of the following disqualifying events occur:

               (a) The Employee is receiving severance pay at the time the Change of Control occurs;

               (b) The Employee has signed an agreement pursuant to which his or her employment will terminate in the future on a date certain;

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               (c) The Company does not undergo a Change of Control prior to termination of his or her employment; or

               (d) Except in the case of a Change of Control, the Employee voluntarily terminates his or her employment with the Company.

SECTION 4

SEVERANCE BENEFIT AMOUNT

     4.1 Severance Pay. Except as otherwise provided in this Section 4, the Severance Pay to be paid to an eligible Employee shall be an amount equal to the sum of (A) the product of the Applicable Multiplier for such Employee multiplied by the sum of one (1) Year of Pay for such Employee plus such Employee’s Eligible Bonus, plus (B) the pro rata portion, through the Termination Date, of any unpaid performance bonus earned by such Employee for the year in which the Change of Control occurs. In addition, except as otherwise provided in this Section 4:

               (a) all of such Employee’s options or other rights to acquire Common Shares or partnership interests in Liberty Property Limited Partnership, all unvested amounts contributed by the Company to the Company-sponsored tax-qualified defined contribution plan with a cash or deferred arrangement, commonly known as a “401(k) plan,” for the benefit of such Employee, and all restricted stock granted to such Employee, shall vest immediately upon the Termination Date,

               (b) the Company shall make a lump sum payment to Employee within 60 days following Employee’s Termination Date in an amount equal to three years of maximum contributions allowed under applicable laws to the Company-sponsored tax-qualified defined contribution plan with a cash or deferred arrangement, commonly known as a “401(k) plan.”

               (c) the Company shall make a lump sum payment to Employee within 60 days following the Employee’s Termination Date in an amount equal to the cost to Employee for three (3) years of substantially similar benefits enjoyed by such Employee under the Company’s life insurance, accident or disability plans in which the Employee was participating at the time of the Change of Control.

               (d) For a period of thirty-six (36) months following the Termination Date, the Employee shall continue to receive the medical and dental coverage in effect on his Termination Date (or generally comparable coverage) for himself and, where applicable, his spouse and dependents, at the same premium rates as may be charged from time to time for employees generally, as if the Employee had continued in employment during such period; provided that in order to receive such continued coverage, the Employee shall be required to pay to the Company at the same

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time that premium payments are due for the month an amount equal to the full monthly premium payments required for such coverage. The Company shall reimburse to Employee monthly the premium amount paid by the Employee, less the premium rate charged to active employees for such coverage (the “Health Payment”), no later than the next payroll date of the Company that occurs after the date the premium for the month is paid by the Employee. In addition, on each date on which the monthly Health Payments are made, the Company shall pay to the Employee an additional amount equal to the federal, state and local income and payroll taxes that the Employee incurs on each monthly Health Payment (the “Health Gross-up Payment”). The Health Payment paid to the Employee during the period of time during which the Employee would be entitled to continuation coverage under the Company’s group health plan under COBRA is intended to qualify for the exception from deferred compensation as a medical benefit provided in accordance with the requirements of Treas. Reg. §1.409A-1(b)(9)(v)(B). The Health Payment and the Health Gross-up Payment shall be reimbursed to the Employee in a manner that complies with the requirements of Treas. Reg. §1.409A-3(i)(1)(iv). The COBRA health continuation coverage period under Section 4980B of the Internal Revenue Code of 1986, as amended (the “Code”) shall begin to run at the end of the thirty-six (36) month period during which Employee is entitled to medical coverage under this Agreement.

     4.2 Increases to Severance Pay. The Company, in its sole discretion, may increase the Severance Pay to an amount in excess of that specified in Section 4.1, subject to the limitations of Section 4.6. Any increase in severance pay must be expressly authorized in writing by the Compensation Committee.

     4.3 Unemployment Compensation. If an Employee applies for and receives unemployment compensation payments for any period of time during or for which Severance Pay is being paid, any Severance Pay remaining to be paid shall not be reduced by the amount of any such unemployment compensation payments.

     4.4 Sickness; Disability. If an Employee due to sickness or injury receives short-term disability payments, worker’s compensation or long-term disability payments after the Employee’s Termination Date, the Employee shall not receive any Severance Pay until the cessation of said payments. Once such payments cease, the amount of Severance Pay to which the Employee is entitled shall be reduced by the amount of any such short-term disability, worker’s compensation or long-term disability payments.

     4.5 Reduction of Severance Pay. The severance benefit provided for in the Plan is the maximum benefit that the Company will pay for severance. To the extent that a federal, state or local law might require the Company to make a payment to an Employee because of that Employee’s involuntary termination (other than with respect to unemployment compensation), the benefit payable under the Plan shall be correspondingly reduced. To the extent that an Employee receives severance pay in connection with the cessation of his or her employment other than pursuant to the Plan

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(whether pursuant to a contract or other severance plan or policy), the benefit payable under the Plan shall be correspondingly reduced. Any overpayments made under the Plan shall be promptly repaid after written request. Severance Pay that will be offset does not include payments received by an Employee due to his or her participation in any other benefit plan which is not a severance plan, or payments made to an Employee for his or her accrued, but unused vacation or Paid Time Off days.

     4.6 Section 280G(b) of Code.

     (a) If, at the time the Change of Control occurs, section 280G(b) of the Code is applicable to the Employee and to the Company with respect to the events associated with the Change of Control, then notwithstanding any other provision of the Plan, in the event that it shall be determined that any payment or distribution by the Company to or for the benefit of an Employee, whether paid or payable or distributed or distributable pursuant to the terms of this Plan or otherwise (the “Payment”), would constitute an “excess parachute payment” within the meaning of section 280G of the Code, the Employee shall be paid an additional amount (the “Gross-Up Payment”) such that the net amount retained by the Employee after deduction of any excise tax imposed under section 4999 of the Code, and any federal, state and local income, employment tax and excise tax imposed upon the Gross-Up Payment, shall be an amount such that the Employee will be in the same after-tax position as if no excise tax under the Code had been imposed; provided, however, that the Gross-Up Payment shall be payable only if it results in an after-tax payment amount to the Employee at least $25,000 greater than the Employee’s after-tax position without the Gross-Up Payment. In the event that the after-tax benefit would not meet this threshold, the Payment will be reduced in such amount as is reasonably deemed necessary by the Company so that no excise tax is imposed. Any Gross-Up Payment shall be paid by Company to Employee within five (5) days of receipt of the Company’s independent public accountant’s determination (as described below), but in any event not later than the end of the Employee’s taxable year next following the Employee’s taxable year in which the related taxes are remitted to the taxing authority.

     (b) For purposes of determining the amount of the Gross-Up Payment, the Employee shall be deemed to pay federal income tax and employment taxes at the highest marginal rate of federal income and employment taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of the Employee’s residence (or, if greater, the state and locality in which the Employee is required to file a nonresident income tax return with respect to the Payment) on the date of termination, net of the maximum reduction in federal income taxes that may be obtained from the deduction of such state and local taxes (calculated by assuming that any reduction in itemized deductions allowable to him applies first to reduce the amount of such state and local taxes which would otherwise be deductible by him). All determinations to be made under this Section 4.6 shall be made by the tax counsel and Company’s independent

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public accountant immediately prior to the Change in Control (which may be the Company’s auditors (the “Referee”), which firm(s) shall provide its determinations and any supporting calculations both to the Company and the Employee within ten days of the Employee’s termination date. Any such determination by the Referee shall be binding upon the Company and the Employee. All fees and expenses of the Referee in performing the determinations referred to above shall be borne solely by the Company.

     (c) As a result of uncertainty in the application of section 4999 of the Code at the time of the initial determination by the Referee, it is possible that the Gross-Up Payment made will have been an amount less than the Company should have paid pursuant to this Section 4.6 (the “Underpayment”) or an amount greater than the Company should have paid pursuant to this Section 4.6 (the “Overpayment”). In the event that it is finally determined that an Underpayment exists and the Employee is required to make a payment of any excise tax or related tax, the Gross-Up Payment shall be adjusted accordingly and the shortfall shall be promptly paid by the Company to the Employee. In the event that it is finally determined that an Overpayment exists and the Company paid a Gross-Up Payment to the Employee in excess of the amount of the Gross-Up Payment to which he is actually entitled hereunder, such excess shall be promptly reimbursed by the Employee to the Company. The Company agrees to indemnify and hold harmless the Referee of and from any and all claims, damages and expenses resulting from or relating to its determinations pursuant to this Section 4.6, except for claims, damages or expenses resulting from the gross negligence or willful misconduct of the Referee.

     4.7 Further Actions. The Company shall have the right to take such action as it deems necessary or appropriate to satisfy any requirements under federal, state or other laws to withhold or to make deductions from any benefits payable under the Plan.

SECTION 5

DISTRIBUTION OF BENEFITS

     5.1 Payment. Except as otherwise specifically provided in this Plan, payments will be made in a single lump sum payment within 60 days following the Employee’s Termination Date.

     5.2 Deceased Employees. Severance Pay shall be paid to the estate of any eligible Employee who dies before the entire amount due hereunder is paid.

SECTION 6

PLAN ADMINISTRATION

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     6.1 Compensation Committee. The Plan shall be administered by the Compensation Committee, which shall have complete authority to prescribe, amend and rescind rules and regulations relating to the Plan, and to make modifications and amendments to the Plan in accordance with Section 7.2 hereof.

     6.2 Determinations Conclusive. The determinations by the Compensation Committee prior to a Change of Control on the matters referred to such Committee shall be conclusive. Prior to a Change of Control, the Compensation Committee shall have full discretionary authority, the maximum discretion allowed by law, to administer, interpret and apply the terms of the Plan, and to determine any and all questions or disputes hereunder, including but not limited to eligibility for benefits and the amount of benefits due. Subsequent to a Change of Control the Compensation Committee shall not have full discretionary authority; rather, its determinations shall be made strictly in accordance with the terms of the Plan and shall be subject to de novo review by a court of competent jurisdiction.

     6.3 Disputes. In the event of a claim by any person, including but not limited to any Employee (the “Claimant”), as to whether such person is entitled to any benefit under the Plan, the amount of any distribution or its method of payment, such Claimant shall present the reason for his or her claim in writing to the Compensation Committee. Such claim must be filed within forty-five (45) days following the date upon which the Claimant first learns of his or her claim. All claims shall be in writing, signed and dated and shall briefly explain the basis for the claim. The claim shall be mailed to the Compensation Committee by certified mail at the following address:

Liberty Property Trust
65 Valley Stream Parkway
Malvern, PA 19355
Attention: General Counsel’s Office
Compensation Committee for the
Liberty Property Trust Management Severance Plan
Telephone:(610) 648-1700
Telecopy:(610) 644-2175 (fax)

     The Compensation Committee shall, within ninety (90) days after receipt of such written claim, decide the claim and send written notification to the Claimant as to its disposition; provided that the Compensation Committee may elect to extend such period for an additional ninety (90) days if special circumstances so warrant and the Claimant is so notified in writing prior to the expiration of the original ninety (90)-day period. In the event the claim is wholly or partially denied, such written notification shall (a) state the specific reason or reasons for the denial; (b) make specific reference to pertinent Plan provisions on which the denial is based; (c) provide a description of any additional material or information necessary for the Claimant to perfect the claim and an

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explanation of why such material or information is necessary; and (d) set forth the procedure by which the Claimant may appeal the denial of his or her claim. The Claimant may request a review of such denial by making application in writing to the Compensation Committee within sixty (60) days after receipt of such denial. Such application must be via certified mail. The named appeals fiduciary is the Compensation Committee or the person(s) named by the Compensation Committee to review the Claimant’s appeal. Such Claimant (or his or her duly authorized representative) may, upon written request to the Compensation Committee, review any documents pertinent to his or her claim, and submit in writing issues and comments in support of his or her claim or position. Within sixty (60) days after receipt of a written appeal, the named appeals fiduciary shall decide the appeal and notify the Claimant of the final decision; provided that the named appeals fiduciary may elect to extend such sixty (60)-day period to up to one hundred twenty (120) days after receipt of the written appeal. The final decision shall be in writing and shall include specific reasons for the decision, written in a manner calculated to be understood by the Claimant, and specific references to the pertinent Plan provisions on which the decision is based.

     6.4 Payment of Fees. All reasonable legal fees and expenses of the Claimant incurred in pursuing a claim in accordance with Section 6.3 shall be reimbursed to such Claimant by the Company, but only if the Claimant substantially prevails with respect to such claim.

SECTION 7

PLAN MODIFICATION OR TERMINATION

     7.1 Automatic Termination. The Plan shall terminate automatically on the day following the annual meeting of the Company’s shareholders to be held in 2004. Unless the Company’s Board of Trustees determines, prior to such termination, that the duration of the Plan shall not be extended, then, on the date of each annual meeting of the Company’s shareholders (beginning with the meeting to be held in 2004), the Plan shall be extended automatically until the day following the next annual meeting of the Company’s shareholders.

     7.2 Modifications and Amendments. Prior to a Change of Control, the Compensation Committee may, in its sole discretion, make any modifications or amendments to the Plan that it deems desirable. If a Change of Control occurs, the Plan may not be modified, amended or terminated until two (2) years after the Change of Control occurs, except for such modifications or amendments which do not adversely affect the rights or reduce the amount of severance benefits payable to of any eligible Employee under the Plan.

     7.3 Determination of Claims. All claims for benefits hereunder, even if raised after termination of the Plan, shall be determined pursuant to Section 6.3, and when

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acting pursuant thereto, the Compensation Committee shall retain the authority provided in Section 6. Notwithstanding any termination of the Plan, if a Change of Control has occurred, all Employees who are eligible before the date of termination to receive Severance Pay pursuant to the Plan shall remain entitled to receive said benefit under the terms and conditions of the Plan.

SECTION 8

GENERAL PROVISIONS

     8.1 No Right to Employment. Nothing herein contained shall be deemed to give any Employee the right to be retained in the employ of the Company or to interfere with the right of the Company to discharge him or her at any time, with or without cause.

     8.2 Vacancies on Compensation Committee. If any of the positions on the Compensation Committee becomes vacant, either the Chairman of the Board or President of the Company may appoint such person or persons as he or she determines, to carry out the responsibilities assigned to such position under the Plan, so long as, if a Change of Control has occurred within two (2) years prior to such appointment, such person was employed by the Company or was a member of the Board of Trustees prior to any such Change of Control.

     8.3 Assignments. Except as otherwise provided by law, no right or interest of any Employee under the Plan shall be assignable or transferable, in whole or in part, either directly or by operation of law or otherwise, including without limitation by execution, levy, garnishment, attachment, pledge or in any other manner, but excluding adjudication of incompetency; no attempted assignment or transfer thereof shall be effective; and no right or interest of any Employee under the Plan shall be liable for, or subject to, any obligation or liability of such Employee, except to the extent specifically provided for herein.

     8.4 Plan Unfunded. The Plan is unfunded.

     8.5 No Set Off; No Mitigation. Except as provided herein, the Company’s obligation to make the payments provided for in the Plan and otherwise to perform its obligations hereunder shall not be affected by any circumstances, including without limitation any set-off, counterclaim, recoupment, defense or other right which the Company may have against Employee or others. In no event shall Employee be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to Employee under any of the provisions of the Plan, and such amounts shall not be reduced whether or not Employee obtains other employment.

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     8.6 Governing Law. The Plan shall be governed by and construed in accordance with the Employee Retirement Income Security Act of 1974, as amended, and to the extent not preempted, the laws of the Commonwealth of Pennsylvania.

     8.7 Welfare Plan. The Plan is intended to constitute a “welfare plan” under the Employee Retirement Income Security Act of 1974, as amended, and any ambiguities in the Plan shall be construed to effect that intent.

     8.8 Section 409A of the Code.

          (a) Interpretation. Notwithstanding the other provisions hereof, this Agreement is intended to comply with the requirements of Section 409A of the Code, to the extent applicable, and this Agreement shall be interpreted to avoid any penalty sanctions under Section 409A of the Code. Accordingly, all provisions herein, or incorporated by reference, shall be construed and interpreted to comply with Section 409A of the Code and, if necessary, any such provision shall be deemed amended to comply with Section 409A of the Code. If any payment or benefit cannot be provided or made at the time specified herein without incurring sanctions under Section 409A of the Code, then such benefit or payment shall be provided in full at the earliest time thereafter when such sanctions will not be imposed. For purposes of Section 409A of the Code, all payments to be made upon a termination of employment under this Agreement may only be made upon a “separation from service” within the meaning of such term under Section 409A of the Code, each payment made under this Agreement shall be treated as a separate payment and the right to a series of installment payments under this Agreement is to be treated as a right to a series of separate payments. In no event shall Employee, directly or indirectly, designate the calendar year of payment.

          (b) Payment Delay. To the maximum extent permitted under Section 409A of the Code, the severance benefits payable under this Agreement are intended to comply with the “short-term deferral exception” under Treas. Reg. §1.409A-1(b)(4), and any remaining amount is intended to comply with the “separation pay exception” under Treas. Reg. §1.409A-1(b)(9)(iii); provided, however, if on the date of Employee’s termination of employment Company’s stock (or stock of any other company required to be aggregated with Company for purposes of Section 409A of the Code) is publicly-traded on an established securities market or otherwise and Employee is a “specified employee” (as such term is defined in Section 409A(a)(2)(B)(i) of the Code and its corresponding regulations) as determined by the Company’s Board of Directors (or its delegate) in its sole discretion in accordance with its “specified employee” determination policy, then all cash severance payments payable to Employee under this Agreement that are deemed as deferred compensation subject to the requirements of Section 409A of the Code and payable within six (6) months following Employee’s “separation from service” shall be postponed for a period of six (6) months following Employee’s “separation from service” with Company. The postponed amounts shall be paid to Employee in a lump sum within 30 days after the date that is six (6) months following Employee’s “separation

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from service” with Company. If Employee dies during such six (6) month period and prior to payment of the postponed cash amounts hereunder, the amounts delayed on account of Section 409A of the Code shall be paid to the personal representative of Employee’s estate within 60 days after Employee’s death.

          (c) Reimbursements. All reimbursements and provision of in-kind benefits provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A of the Code, including, where applicable, the requirement that (i) any reimbursement is for expenses incurred during Employee’s lifetime (or during a shorter period of time specified in this Agreement), (ii) the amount of expenses eligible for reimbursement, or the amount of in-kind benefits provided, during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year, (iii) the reimbursement of an eligible expense or provision of in-kind benefits will be made on or before the last day of the taxable year following the year in which the expense is incurred or payment becomes due, and (iv) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit. Any tax gross up payments to be made hereunder shall be made not later than the end of Employee’s taxable year next following Employee’s taxable year in which the related taxes are remitted to the taxing authority.

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EX-12

EXHIBIT 12

EXHIBIT 12 — STATEMENT RE: COMPUTATION OF RATIO
OF EARNINGS TO FIXED CHARGES
AND RATIO OF EARNINGS TO COMBINED FIXED CHARGES

LIBERTY PROPERTY TRUST / LIBERTY PROPERTY LIMITED PARTNERSHIP
(Amounts in thousands except ratio amounts)

	Year ended December 31,
	2008		2007		2006		2005		2004
Earnings before fixed charges:
Income before allocation of minority interest and income from investments in unconsolidated subsidiaries (1)	$	152,880	$	151,148	$	163,951	$	216,849	$	141,472
Add: Interest expense		151,132		122,967		105,585		104,979		93,042
Depreciation expense on cap’d interest		1,245		5,393		4,437		3,829		3,442
Amortization of deferred financing costs		4,543		4,091		3,897		3,971		3,483
Earnings before fixed charges	$	309,800	$	283,599	$	277,870	$	329,628	$	241,439
Fixed charges:
Interest expense	$	151,132	$	122,967	$	105,585	$	104,979	$	93,042
Amortization of deferred financing charges		4,543		4,091		3,897		3,971		3,483
Capitalized interest		19,958		45,697		30,837		17,748		13,242
Fixed charges		175,633		172,755		140,319		126,698		109,767
Preferred share distributions		—		—		—		—		—
Preferred unit distributions		21,012		17,126		13,691		12,095		11,844
Combined fixed charges	$	196,645	$	189,881	$	154,010	$	138,793	$	121,611
Ratio of earnings to fixed charges		1.76		1.64		1.98		2.60		2.20
Ratio of earnings to combined fixed charges		1.58		1.49		1.80		2.37		1.99

(1) Amounts for the years ended December 31, 2008, 2007, 2006, 2005 and 2004 have been reclassified to present properties that have been sold during 2008. As a result, operations have been reclassified to discontinued operations from continuing operations for all periods presented.

EX-21

Exhibit 21

Liberty Property Trust
Liberty Property Limited Partnership
Liberty Lehigh Partnership
Liberty Property Philadelphia Limited Partnership
Liberty Property Philadelphia Limited Partnership II
Liberty Property Philadelphia Corporation
Liberty Property Philadelphia Trust
Liberty/Commerz 1701 JFK Boulevard, L.P.
Liberty Property Philadelphia Limited Partnership IV West
Liberty Property Philadelphia Corporation IV East
Liberty Property Philadelphia Corporation IV West
Liberty Property Philadelphia Corporation V
Liberty Property Philadelphia Limited Partnership V
Liberty Property Philadelphia Limited Partnership VI
Liberty Property Philadelphia Trust VI
Liberty Property Development Corp.
Liberty Property Development Corp. II
Liberty Special Purpose Trust
Liberty UK Development Corp.
LP Malvern Limited Partnership
LP Malvern LLC
Land Holdings Realty LLC
Rivers Business Commons Associates Limited Partnership
Liberty Property Philadelphia Navy Yard Limited Partnership
Liberty Property Philadelphia Navy Yard Corporation
Liberty Property/Synterra Limited Partnership
Liberty Venture I, LP
Liberty Venture I, LLC
Liberty Illinois, LP
Liberty Illinois Venture, LLC
L/S One Crescent Drive, LP
L/S One Crescent Drive, LLC
L/S Three Crescent Drive, LP
L/S Three Crescent Drive, LLC
L/S 4775 League Island Blvd., LP
L/S 4775 League Island Blvd., LLC
L/S 26^th Street North, LP
L/S 26^th Street North, LLC
L/S 26^th Street South, LP
L/S 26^th Street South, LLC
Liberty West Allis, LLC
Liberty Deer Park, LLC
Liberty Delaware, LLC
Liberty Cotton Center, LLC
Liberty Cotton Center II, LLC
Liberty Property Lux, LLC

Annapolis Development, LLC
9755 Patuxent Woods Drive Trust
Perryman 159, L.L.C.
Liberty Stoneridge, LLC
Liberty Durham, LLC
Liberty 600 Industrial, G.P.
Liberty AIPO Limited Partnership
Liberty Washington, LP
Liberty Washington Venture, LLC
Republic 20^th Street LLC
Republic Property TRS LLC
Republic Park LLC
RKB CP IV LLC
RKB Lakeside Manager LLC
RKB Lakeside LLC
RKB Corporate Oaks LLC
RPT Presidents Park LLC
Presidents Park I LLC
Presidents Park II LLC
Presidents Park III LLC
RKB Pender LLC
RPLP I LLC
RPT 1425 Investors LP
RPT 1425 Holdings LLC
RPT 1425 New York Avenue LLC
RKB WillowWood Manager LLC
RKB WillowWood LLC
RPB WillowWood I LLC
RPB WillowWood II LLC
Silversword Properties Limited
Cambridge Medipark Limited
Liberty Property Trust UK Limited
Kings Hill Estate Management Company Limited
Rouse Kent (Residential) Limited
Rouse Kent Developments Limited
Rouse Kent (Central) Limited
Rouse Kent (1 Tower View) Limited
Kings Hill Property Management Limited
Kings Hill Residential Estate Management Company Limited
iCO Didsbury Limited
Kings Hill Unit Trust
Liberty Property Trust Lux Sarl
Blythe Valley JV Sarl
BVP I Sarl
BVP II Sarl
Blythe Valley Innovation Centre Ltd.
BVP Management Co. Ltd.

EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the following Registration Statements:

1)	Registration Statement (Form S-3 No. 333-120692),
2)	Registration Statement (Form S-3 No. 333-150737),
3)	Registration Statement (Form S-3 No. 33-94782),
4)	Registration Statement (Form S-3 No. 333-22211),
5)	Registration Statement (Form S-3 No. 333-43267),
6)	Registration Statement (Form S-3 No. 333-39282) ,
7)	Registration Statement (Form S-3 No. 333-65592),
8)	Registration Statement (Form S-3 No. 333-125571) of Liberty Property Trust and Liberty Property Limited Partnership, and
9)	Registration Statement (Form S-3 No. 333-156460),
10)	Registration Statement (Form S-3 No. 333-148614),
11)	Registration Statement (Form S-3 No. 333-14139),
12)	Registration Statement (Form S-8 No. 333-141314) pertaining to the Liberty Property Trust Amended and Restated Share Incentive Plan,
13)	Registration Statement (Form S-8 No. 333-32244) pertaining to the Liberty Property Trust Amended and Restated Share Incentive Plan,
14)	Registration Statement (Form S-3 No. 333-53297),
15)	Registration Statement (Form S-3 No. 333-63115),
16)	Registration Statement (Form S-3 No. 333-37218),
17)	Registration Statement (Form S-3 No. 333-45032),
18)	Registration Statement (Form S-8 No. 333-62504) pertaining to the Liberty Property Trust Amended and Restated Share Incentive Plan,
19)	Registration Statement (Form S-8 No. 333-62506) pertaining to the Liberty Property Trust Amended and Restated Share Incentive Plan,
20)	Registration Statement (Form S-3 No. 333-63494),
21)	Registration Statement (Form S-3 No. 333-63978),
22)	Registration Statement (Form S-3 No. 333-91702),
23)	Registration Statement (Form S-3 No. 333-107482),
24)	Registration Statement (Form S-3 No. 333-108040),
25)	Registration Statement (Form S-3 No. 333-114609),
26)	Registration Statement (Form S-3 No. 333-118994),
27)	Registration Statement (Form S-3 No. 333-130948),
28)	Registration Statement (Form S-3 No. 333-125572),
29)	Registration Statement (Form S-3 No. 333-122365), and
30)	Registration Statement (Form S-8 No. 333-118995) pertaining to the Liberty Property Trust Amended and Restated Share Incentive Plan, and in the related Prospectuses

of our reports dated February 25, 2009, with respect to the consolidated financial statements and schedule of Liberty Property Trust, and the effectiveness of internal control over financial reporting of Liberty Property Trust, included in this Annual Report (Form 10-K) for the year ended December 31, 2008.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania
February 25, 2009

EX-23.2

Exhibit 23.2

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the Registration Statements:

1)	Registration Statement (Form S-3 No. 333-120692),
2)	Registration Statement (Form S-3 No. 333-150737),
3)	Registration Statement (Form S-3 No. 33-94782),
4)	Registration Statement (Form S-3 No. 333-22211),
5)	Registration Statement (Form S-3 No. 333-43267),
6)	Registration Statement (Form S-3 No. 333-39282),
7)	Registration Statement (Form S-3 No. 333-65592), and
8)	Registration Statement (Form S-3 No. 333-125571);

of Liberty Property Trust and Liberty Property Limited Partnership and in the related Prospectuses of our reports dated February 25, 2009, with respect to the consolidated financial statements and schedule of Liberty Property Limited Partnership, and the effectiveness of internal control over financial reporting of Liberty Property Limited Partnership, included in this Annual Report (Form 10-K) for the year ended December 31, 2008.

/s/ Ernst & Young LLP

Philadelphia, Pennsylvania
February 25, 2009

EX-31.1

Exhibit 31.1

LIBERTY PROPERTY TRUST

CERTIFICATIONS REQUIRED BY
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

I, William P. Hankowsky, certify that:

1. I have reviewed this Form 10-K of Liberty Property Trust;

2. Based on my knowledge, this 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 report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

     (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     (b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     (c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     (d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting,

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 27, 2009	By:	/s/ WILLIAM P. HANKOWSKY
	William P. Hankowsky
	Chairman, President and Chief Executive Officer

EX-31.2

Exhibit 31.2

LIBERTY PROPERTY TRUST

CERTIFICATIONS REQUIRED BY
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

I, George J. Alburger, Jr., certify that:

1. I have reviewed this Form 10-K of Liberty Property Trust;

2. Based on my knowledge, this 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 report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

     (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     (b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     (c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     (d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting,

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 27, 2009	By:	/s/ GEORGE J. ALBURGER, JR.
	George J. Alburger, Jr.
	Executive Vice President and Chief Financial Officer

EX-31.3

Exhibit 31.3

LIBERTY PROPERTY LIMITED PARTNERSHIP

CERTIFICATIONS REQUIRED BY
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

I, William P. Hankowsky, certify that:

1. I have reviewed this Form 10-K of Liberty Property Limited Partnership;

2. Based on my knowledge, this 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 report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

     (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     (b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     (c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     (d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting,

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 27, 2009	By:	/s/ WILLIAM P. HANKOWSKY
	William P. Hankowsky
	Chairman, President and Chief Executive Officer of Liberty Property Trust, the Registrant's sole general partner

EX-31.4

Exhibit 31.4

LIBERTY PROPERTY LIMITED PARTNERSHIP

CERTIFICATIONS REQUIRED BY
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

I, George J. Alburger, Jr., certify that:

1. I have reviewed this Form 10-K of Liberty Property Limited Partnership;

2. Based on my knowledge, this 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 report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

     (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     (b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     (c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     (d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting,

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 27, 2009	By:	/s/ GEORGE J. ALBURGER, JR.
	George J. Alburger, Jr.
	Executive Vice President and Chief Financial Officer of Liberty Property Trust, the Registrant's sole general partner

EX-32.1

Exhibit 32.1

LIBERTY PROPERTY TRUST

CERTIFICATIONS REQUIRED BY
RULE 13a-14(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934

     In connection with the Annual Report of Liberty Property Trust (the “Company”) on Form 10-K for the year ended December 31, 2008 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, WILLIAM P. HANKOWSKY, President and Chief Executive Officer of the Company, certify in connection with Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, that based on my knowledge:

     (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ WILLIAM P. HANKOWSKY William P. Hankowsky

Chairman, President and Chief Executive Officer

Date: February 27, 2009

EX-32.2

Exhibit 32.2

LIBERTY PROPERTY TRUST

CERTIFICATIONS REQUIRED BY
RULE 13a-14(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934

     In connection with the Annual Report of Liberty Property Trust (the “Company”) on Form 10-K for the year ended December 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, GEORGE J. ALBURGER, JR., Executive Vice President and Chief Financial Officer of the Company, certify in connection with Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, that based on my knowledge:

     (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ GEORGE J. ALBURGER, JR. George J. Alburger, Jr.

Executive Vice President and Chief Financial Officer

Date: February 27, 2009

EX-32.3

Exhibit 32.3

LIBERTY PROPERTY LIMITED PARTNERSHIP

CERTIFICATIONS REQUIRED BY
RULE 13a-14(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934

     In connection with the Annual Report of Liberty Property Limited Partnership (the “Company”) on Form 10-K for the year ended December 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, WILLIAM P. HANKOWSKY, President and Chief Executive Officer of Liberty Property Trust (the sole general partner of the Company), certify in connection with Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, that based on my knowledge:

     (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ WILLIAM P. HANKOWSKY

William P. Hankowsky

Chairman, President and Chief Executive Officer
of Liberty Property Trust, the Company’s sole general partner

Date: February 27, 2009

EX-32.4

Exhibit 32.4

LIBERTY PROPERTY LIMITED PARTNERSHIP

CERTIFICATIONS REQUIRED BY
RULE 13a-14(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934

     In connection with the Annual Report of Liberty Property Limited Partnership (the “Company”) on Form 10-K for the year ended December 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, GEORGE J. ALBURGER, JR., Executive Vice President and Chief Financial Officer of Liberty Property Trust (the sole general partner of the Company), certify in connection with Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, that based on my knowledge:

     (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ GEORGE J. ALBURGER, JR.

George J. Alburger, Jr.

Executive Vice President and Chief Financial Officer
of Liberty Property Trust, the Company’s sole general partner

Date: February 27, 2009

EX-99.1

Exhibit 99.1

LIBERTY PROPERTY TRUST

PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
To Be Held May 15, 2008

GENERAL INFORMATION

This proxy statement is being furnished in connection with the solicitation of proxies by the Board of Trustees of Liberty Property Trust, a Maryland real estate investment trust (the “Trust” or the “Company”), for use at the Trust’s 2008 Annual Meeting of Shareholders (the “Meeting”) to be held at The Desmond Hotel, One Liberty Boulevard, Malvern, Pennsylvania 19355 on May 15, 2008 at 11:00 a.m., local time, and any adjournment or postponement thereof, for the purposes set forth in the foregoing notice and more fully discussed herein. This proxy statement, the foregoing notice and the enclosed proxy are first being mailed to shareholders of the Trust on or about April 18, 2008. Only shareholders of record at the close of business on March 20, 2008 (the “Record Date”) shall be entitled to notice of and to vote at the Meeting.

If the enclosed proxy is properly executed and received by the Trust prior to voting at the Meeting, the common shares of beneficial interest, $0.001 par value per share, of the Trust (the “common shares”) represented thereby will be voted in accordance with the instructions marked thereon. In the absence of instructions, the common shares represented by the enclosed proxy will be voted FOR the nominees of the Board of Trustees in the election of trustees and FOR ratification of the selection of Ernst & Young LLP as the Trust’s independent registered public accounting firm for 2008. Management does not intend to bring any matter before the Meeting other than as indicated in the notice and does not know of anyone else who intends to do so. If any other matters properly come before the Meeting, however, the persons named in the enclosed proxy, or their duly constituted substitutes acting at the Meeting, will be authorized to vote or otherwise act thereon in accordance with their judgment on such matters.

Any proxy may be revoked at any time prior to its exercise by notifying the Secretary of the Trust in writing prior to the time of the Meeting, by delivering a duly executed proxy bearing a later date or by attending the Meeting and voting in person.

On the Record Date, the Trust had 92,032,075 common shares outstanding and entitled to vote at the Meeting. Each holder of common shares is entitled to one vote per share held of record by such holder on the Record Date. There must be present at the Meeting in person or by proxy shareholders entitled to cast a majority of all the votes entitled to be cast to constitute a quorum for the Meeting. Common shares represented at the Meeting in person or by proxy but not voted on one or more proposals will be included in determining the presence of a quorum, but will not be considered cast on any proposal on which they were not voted. Thus, abstentions and broker “non-votes” are deemed to be present at the Meeting for the purpose of determining whether a quorum is constituted, but are not deemed to be votes cast at the Meeting. A broker “non-vote” occurs when a nominee holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power on that item and has not received instructions from the beneficial owner.

Abstentions and broker “non-votes” will affect each of the proposals described in this proxy as follows:

•  On the proposal to elect four Class II trustees to hold office until the Annual Meeting of Shareholders to be held in 2011 and until their successors are duly elected and qualified, the vote of a majority of all the votes cast at the Meeting is necessary to elect a trustee. Neither abstentions nor broker non-votes will be counted as votes cast, and therefore will have no effect on the results of the vote with respect to this proposal.

•  The vote of a majority of all the votes cast at the Meeting is necessary to ratify the selection of Ernst & Young LLP as the Trust’s independent registered public accounting firm for 2008. Neither abstentions nor broker non-votes will be counted as votes cast, and therefore will have no effect on the results of the vote with respect to this proposal.

Assuming a quorum is present at the Meeting, a majority of all the votes cast at the Meeting shall be sufficient to elect a trustee. A majority of all votes cast in an election for trustee means that the number of shares voted “for” a nominee for trustee must exceed the number of votes cast as “withheld” from that nominee. In addition, the Trust’s

SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information, as of March 20, 2008 (except as indicated below), regarding the beneficial ownership, as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), of common shares by each trustee, each nominee for election as trustee, each executive officer listed in the Summary Compensation Table appearing on page 18, all trustees and executive officers as a group, and each person who is known to the Trust to be the beneficial owner of more than five percent of the outstanding common shares. Each person named in the table below has sole voting and investment power with respect to the common shares listed opposite such person’s name, except as otherwise noted.

	Number of
	Shares
	Beneficially			Percent of
Beneficial Owner	Owned			Class
William P. Hankowsky		382,490	(1)		*
George J. Alburger, Jr.		566,415	(2)		*
Robert E. Fenza		438,159	(3)		*
James J. Bowes		276,098	(4)		*
Michael T. Hagan		52,805	(5)		*
Frederick F. Buchholz		56,995	(6)		*
Thomas C. DeLoach, Jr.		43,803	(7)		*
Daniel P. Garton		21,902	(8)		*
J. Anthony Hayden		116,268	(9)		*
M. Leanne Lachman		65,006	(10)		*
David L. Lingerfelt		78,439	(11)		*
Jose A. Mejia		4,905	(12)		*
John A. Miller		58,448	(13)		*
Stephen B. Siegel		36,813	(14)		*
Cohen & Steers, Inc.		10,704,625	(15)		11.6	%
Morgan Stanley		7,361,207	(16)		8.0	%
Barclays Global Investors, NA		7,349,008	(17)		8.0	%
The Vanguard Group, Inc.		5,530,904	(18)		6.0	%
Abbey National Securities		4,875,600	(19)		5.3	%
ING Groep N.V.		4,612,729	(20)		5.0	%
All trustees and executive officers as a group (14 persons)		2,198,546	(21)		2.3	%

*	Represents less than one percent of class.
(1)	Includes 276,269 common shares subject to options exercisable within 60 days after March 20, 2008.
(2)	Includes 441,135 common shares subject to options exercisable within 60 days after March 20, 2008.
(3)	Includes 176,756 common shares subject to options exercisable within 60 days after March 20, 2008 and 195,043 common shares issuable upon exchange of units of limited partnership interest (“Units”) of Liberty Property Limited Partnership, a Pennsylvania limited partnership (the “Operating Partnership”) which, as of December 31, 2007, was 95.6% owned by the Trust. Also includes 700 common shares, held by Mr. Fenza as custodian for his children, or owned directly by such children, as to which Mr. Fenza disclaims beneficial ownership. Includes 110,000 Units pledged by the beneficial owner as security for loans.
(4)	Includes 245,793 common shares subject to options exercisable within 60 days after March 20, 2008.
(5)	Includes 17,305 common shares subject to options exercisable within 60 days after March 20, 2008 and 14,491 common shares issuable upon exchange of Units.
(6)	Includes 28,500 common shares subject to options exercisable within 60 days after March 20, 2008.

3

(7)	Includes 6,000 common shares subject to options exercisable within 60 days after March 20, 2008.
(8)	Includes 18,500 common shares subject to options exercisable within 60 days after March 20, 2008.
(9)	Includes 38,500 common shares subject to options exercisable within 60 days after March 20, 2008. Includes 30,000 common shares pledged by the beneficial owner as security for loans.
(10)	Includes 28,500 common shares subject to options exercisable within 60 days after March 20, 2008.
(11)	Includes 38,500 common shares subject to options exercisable within 60 days after March 20, 2008 and 30,674 common shares issuable upon exchange of Units. Also includes 415 common shares held by trusts for the benefit of Mr. Lingerfelt’s children, as to which Mr. Lingerfelt disclaims beneficial ownership.
(12)	Includes 3,500 common shares subject to options exercisable within 60 days after March 20, 2008.
(13)	Includes 38,500 common shares subject to options exercisable within 60 days after March 20, 2008.
(14)	Includes 5,000 common shares subject to options exercisable within 60 days after March 20, 2008.
(15)	As of December 31, 2007, Cohen & Steers, Inc. (“Cohen & Steers”) had sole dispositive power and sole voting power over 10,704,625 and 10,047,969 common shares, respectively. This information is based solely on a review of a Schedule 13G/A filed by Cohen & Steers with the Securities and Exchange Commission. Cohen & Steers’ address is 280 Park Avenue, 10th Floor, New York, NY 10017.
(16)	As of December 31, 2007, Morgan Stanley had sole dispositive power and sole voting power over 7,361,207 and 4,412,210 common shares, respectively. This information is based solely on a review of a Schedule 13G/A filed by Morgan Stanley with the Securities and Exchange Commission. Morgan Stanley’s address is 1585 Broadway, New York, NY 10036.
(17)	As of December 31, 2007, Barclays Global Investors, NA and certain of its affiliates (“Barclays”) had sole dispositive power and sole voting power over 7,349,008 and 6,271,736 common shares, respectively. These entities expressly disclaim “group” status, as defined in Rule 13d-1 under the Exchange Act. This information is based solely on a review of a Schedule 13G filed by Barclays with the Securities and Exchange Commission. Barclays’ address is 45 Fremont Street, San Francisco, CA 94105.
(18)	As of December 31, 2007, The Vanguard Group, Inc. (“Vanguard”) had sole dispositive power and sole voting power over 5,530,904 and 37,352 common shares, respectively. This information is based solely on a review of a Schedule 13G/A filed by Vanguard with the Securities and Exchange Commission. Vanguard’s address is 100 Vanguard Boulevard, Malvern, PA 19355.
(19)	As of December 31, 2007, Abbey National Securities Inc. (“Abbey”) had sole dispositive power and sole voting power over 4,875,600 common shares, respectively. This information is based solely on a review of a Schedule 13G filed by Abbey with the Securities and Exchange Commission. Abbey’s address is 400 Atlantic Street, Stamford, CT 06901.
(20)	As of December 31, 2007, ING Groep N.V. had sole dispositive power and sole voting power over 4,612,729 common shares. This information is based solely on a review of a Schedule 13G/A filed by ING Groep, N.V. with the Securities and Exchange Commission. ING’s address is Amstelveenseweg 500, 1081KL Amsterdam, P.O. Box 810, 1000 AV Amsterdam, The Netherlands.
(21)	Includes 1,362,757 common shares subject to options exercisable within 60 days after March 20, 2008 and 240,208 common shares issuable upon exchange of Units. Includes 140,000 common shares pledged by the beneficial owners as security for loans, of which 110,000 are common shares issuable upon exchange of Units pledged by the beneficial owner as security for loans.

4

ELECTION OF TRUSTEES AND CONTINUING TRUSTEES

In accordance with the Declaration of Trust and By-laws, the Board of Trustees has fixed the total number of trustees at ten. The Board is divided into three classes serving staggered three-year terms, the term of one class of trustees to expire in each successive year. Four Class II trustees will be elected at the Meeting to serve until the Annual Meeting of Shareholders to be held in 2011 and until their successors are duly elected and qualified. Each of the nominees for election as trustee currently serves as a trustee of the Trust.

A proxy signed in the enclosed form will be voted FOR the election of the nominees named below, unless a contrary instruction is given.

Management believes that each of its nominees is willing and able to serve the Trust as trustee. If any nominee at the time of election is unable or unwilling to serve or is otherwise unavailable for election, and as a consequence thereof other nominees are designated, the persons named in the proxy or their substitutes will have the discretion and authority to vote or to refrain from voting for other nominees in accordance with their judgment.

The following is a brief description of the nominees for election as trustee and of the other continuing trustees of the Trust.

Recommendation and Required Vote

The Board of Trustees recommends a vote FOR the election of each nominee. Assuming a quorum is present at the Meeting, a majority of all the votes cast at the Meeting shall be sufficient to elect a trustee.

Nominations for Election as Class II Trustees with Terms to Expire in 2011

Frederick F. Buchholz, age 62, has served as a trustee of the Trust since June 1994. Mr. Buchholz was with Lend Lease Real Estate Investments or its predecessors from 1968 until retiring in June 1998. Since his retirement, Mr. Buchholz has served as an independent real estate consultant. He was appointed a Senior Vice President of Equitable Real Estate in December 1990 and Executive Vice President in 1992. At various times, Mr. Buchholz was also the officer in charge of Equitable Real Estate’s New York and Washington, D.C. regional offices. Prior to his retirement, Mr. Buchholz was the officer in charge of the Lend Lease Philadelphia region, supervising new business, asset management and restructuring/workout activities on behalf of a total mortgage and equity portfolio exceeding $2.5 billion. Mr. Buchholz is a member of the Appraisal Institute and is a member of the Board of Trustees of GMH Communities Trust (NYSE:GCT) and the Investment Review Committee of the Delaware Valley Real Estate Investment Fund, L.P.

Thomas C. DeLoach, Jr., age 60, has served as a trustee of the Trust since May 1999. Beginning in 1998, Mr. DeLoach served as an Executive Vice President of Mobil Oil Corporation and the President of Global Midstream, both wholly owned subsidiaries of Mobil Corporation (now Exxon Mobil Corporation), a global energy company, prior to his retirement in March 2000. Mr. DeLoach joined Mobil Corporation in 1969 as a chemical engineer and advanced through various positions in manufacturing, marketing, planning and supply. From December 1994 until his election as President of Global Midstream, Mr. DeLoach served as Chief Financial Officer and Senior Vice President of Mobil Corporation and Mobil Oil Corporation. From 1991 until his retirement in 2000, Mr. DeLoach served as a director of Mobil Oil Corporation. Mr. DeLoach was a partner in a Penske Racing, LLC from 2000 until 2002 and has been the Managing Partner of PIT Instruction & Training, LLC since 2003 and Red Horse Racing II, LLC since 2005. Mr. DeLoach is also a member of the Board of Directors of Asbury Automotive Group (NYSE:ABG).

Daniel P. Garton, age 50, has served as a trustee of the Trust since December 2001. Since September 2002, Mr. Garton has served as Executive Vice President-Marketing of AMR Corporation’s American Airlines unit. In that position, Mr. Garton oversees American Airlines’ activities with respect to reservations, flight service, sales, its travel awards program, advertising and corporate communications. Previously, Mr. Garton served as Senior Vice President and then Executive Vice President of American Airlines Customer Service beginning September 1998 and served as President of American Eagle Airlines for three years beginning in July 1995. American Eagle Airlines is a wholly owned subsidiary of AMR Corporation. Mr. Garton joined AMR Corporation in 1984 as an analyst in the finance department and advanced through various positions to the office of Vice President-Financial Planning and

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Analysis in 1992. Mr. Garton left AMR Corporation in 1993 to become Senior Vice President and Chief Financial Officer of Continental Airlines. He returned to AMR Corporation two years later when he assumed the presidency of American Eagle Airlines.

Stephen B. Siegel, age 63, has served as a trustee of the Trust since May 1995. Mr. Siegel is Chairman of Global Brokerage Services of CB Richard Ellis, one of the world’s premier full service real estate companies. Prior to its merger with CB Richard Ellis, Mr. Siegel was the Chairman and Chief Executive Officer of Insignia/ESG, Inc., one of the premier commercial real estate companies in the United States, with significant international operations in the United Kingdom, Europe, Asia and Latin America. Mr. Siegel became the President and Chief Executive Officer of Insignia/ESG, Inc.’s predecessor company, Edward S. Gordon Company (“ESG”), in 1992. Prior to joining ESG, Mr. Siegel spent more than 27 years at Cushman & Wakefield, including as Chief Executive Officer. Mr. Siegel left Cushman & Wakefield in late 1988 and entered a joint venture with the Chubb Corporation where he worked for several years to develop and acquire investment-grade office buildings throughout the United States. Mr. Siegel is also involved in a number of charitable and civic affairs. He is the General Chairman of the Association for the Help of Retarded Children. In addition, Mr. Siegel is the President of the Board of the American Friends of Rabin Medical Center, and is a board member for the City Center 55th Street Theater Foundation and the Greater New York Council of the Boy Scouts of America.

Continuing Class III Trustees with Terms to Expire in 2009

William P. Hankowsky, age 57, has served as a trustee of the Trust since May 2003. Mr. Hankowsky joined the Trust on January 1, 2001 as Executive Vice President and Chief Investment Officer and was promoted to the position of President on March 12, 2002. Mr. Hankowsky became the Chief Executive Officer of the Trust on January 21, 2003 and Chairman on June 10, 2003. Prior to joining the Trust, Mr. Hankowsky served as President of the Philadelphia Industrial Development Corporation (“PIDC”) from 1989 through 2000. As the chief executive officer of PIDC, he oversaw the City of Philadelphia’s economic development agency. Prior to that time, Mr. Hankowsky served as an executive with a variety of economic development projects and agencies. Mr. Hankowsky currently serves on the boards of Aqua America, Inc. (NYSE:WTR), Citizens Financial Group, Philadelphia Convention and Visitors Bureau, Innovation Philadelphia, Philadelphia Shipyard Development Corporation, Philadelphia Board of Trade and the Kimmel Center for the Performing Arts.

David L. Lingerfelt, age 55, has served as a trustee of the Trust since May 1995. Mr. Lingerfelt is a Vice President and Commercial Counsel of LandAmerica Exchange Company. Prior to joining LandAmerica, Mr. Lingerfelt was an attorney in private practice specializing in commercial transactions. Mr. Lingerfelt has previously served as Director of Property Administration and Counsel for Best Products Co., Inc., and was a partner in the Virginia law firm of Coates & Davenport. Mr. Lingerfelt is currently the Director of the Reverse Exchange Division for LandAmerica 1031 Exchange Services.

John A. Miller, age 80, has served as a trustee of the Trust since May 1995. Mr. Miller retired in July 1997 from the Board of Trustees of the Provident Mutual Life Insurance Company of Philadelphia after serving as Director and Chairman of the Executive Committee. Mr. Miller served Provident Mutual in many capacities over his 25 years there, including as its President, Chief Operating Officer, Chief Executive Officer and Chairman of the Board. He has been a member of various Boards of Directors, including those of BetzDearborn, Bryn Mawr Hospital, Guarantee Reassurance Corp., CoreStates Financial Corp., CoreStates Bank N.A and the National Constitution Center.

Jose A. Mejia, age 47, has served as a trustee of the Trust since June 2005. Mr. Mejia is Co-Chairman of Univa Capital, a privately owned holding company which invests in various sectors including real estate, infrastructure management, entertainment and healthcare. Prior to joining Univa on a full-time basis, Mr. Mejia was the Executive Vice President of Operations for Spansion, Inc., a leading Flash memory solutions provider. Prior to joining Spansion in 2006, Mr. Mejia served in several executive positions with Lucent Technologies, including as President of Lucent’s Supply Chain Networks where he oversaw all aspects of the company’s supply chain. He joined Lucent in 1999, and previously held executive positions in supply chain management and planning at Nortel Networks, Bay Networks, Ford Motor Company, IBM and Owens Illinois. Mr. Mejia also serves on the boards of the Pella

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Corporation and the Smithsonian Institute — Latino Center. He is also a member of the board of advisors for the Fuqua School of Business at Duke University.

Continuing Class I Trustees with Terms to Expire in 2010

J. Anthony Hayden, age 64, has served as a trustee of the Trust since June 1994. Mr. Hayden is Chairman of Hayden Real Estate Investments, LLC, a privately-held commercial real estate investment and acquisition firm. Prior to forming Hayden Real Estate Investments, LLC Mr. Hayden was Chairman of Beacon Commercial Real Estate LLC. The company was formed as Hayden Real Estate in 1996. Prior to forming Hayden Real Estate, Mr. Hayden spent more than 21 years at Cushman & Wakefield where he was a member of the Board of Trustees. When he resigned as Executive Vice President in 1996 he was responsible for 10 offices in the Mid-Atlantic/Mid-West region. Mr. Hayden is a member of the Society of Industrial & Office Realtors, serving in 1982 as President of the Philadelphia Chapter. He is also a member of the Philadelphia Board of Realtors and was President in 1985. In the past he has served on the boards of Pierce Leahy Corporation, Founders Bank and TeleSpectrum Worldwide. Mr. Hayden currently serves on the boards of a variety of not-for-profit entities, including LaSalle University.

M. Leanne Lachman, age 65, has served as a trustee of the Trust since June 1994. Ms. Lachman is the President of Lachman Associates, LLC, a real estate consulting firm. Until October 2003, Ms. Lachman was a Managing Director of Lend Lease Real Estate Investment Management, a pension fund advisor. Ms. Lachman has specialized in real estate investment management for institutions since 1987. Prior to her employment with Lend Lease Real Estate Investment, Ms. Lachman served as a Managing Director for Boston Financial and Schroder Real Estate Associates. Ms. Lachman is a director of Lincoln National Corporation and Lincoln Life & Annuity of New York, a subsidiary of Lincoln National Corporation. Additionally, Ms. Lachman is an Executive-in-Residence at Columbia Business School.

Additional Executive Officers

George J. Alburger, Jr., age 60, became Chief Financial Officer and Treasurer of the Trust in May 1995. Effective October 24, 2000, Mr. Alburger assumed the additional title of Executive Vice President. Prior to joining the Trust, Mr. Alburger served as Executive Vice President of EBL&S Property Management, Inc., an owner and manager of approximately 200 shopping centers aggregating 30 million square feet of retail space. Mr. Alburger was formerly a Senior Manager with PriceWaterhouse, LLP.

Robert E. Fenza, age 51, has served as an Executive Vice President of the Trust since March 1994, with principal responsibility for operations, property management and asset management. Effective April 1, 2000, Mr. Fenza assumed the additional title of Chief Operating Officer of the Trust. Mr. Fenza joined Rouse & Associates in 1984. Mr. Fenza serves on the Board of the Charter High School for Architecture and Design in Philadelphia. Mr. Fenza also chairs the Advisory Board for the College of Arts & Architecture at the Pennsylvania State University and is a member of the Advisory Board for FM Global, a leading provider of commercial property insurance and risk management services.

James J. Bowes, age 54, has served as General Counsel and Secretary of the Trust since December 1996. Mr. Bowes joined the Trust from the law firm of Blank Rome LLP, where he was a partner in the Corporate Department. Prior to joining Blank Rome, he served with the Securities and Exchange Commission.

Michael T. Hagan, age 50, has served as Chief Investment Officer of the Trust since May 2005. Mr. Hagan joined the Trust in 1989 and has served the Trust in a number of capacities, including, prior to his appointment as Chief Investment Officer, as Senior Vice President — Acquisitions. Prior to joining the Trust, Mr. Hagan served in a variety of accounting positions.

Each officer will serve until the first meeting of the Board after the next annual meeting of shareholders or until the officer resigns or is removed from office by the Board.

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Trustees’ Compensation

The 2008 compensation policy for trustees who are not also officers and full-time employees of the Trust is the same as the policy that was in place in 2007. Under this policy, these trustees receive an annual trustee fee in the amount of $21,500 in cash, and restricted common shares with a grant date fair value of $34,500. Additionally, trustees receive a fee of $1,500 for each Board meeting that such trustee attends in person; however, trustees receive

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a fee of $500 for teleconference Board meetings if such meetings address only routine matters. Trustees also receive a fee of $500 for participation in any informational call held to supplement the regularly scheduled Board meetings. Trustees will be entitled to receive a fee of $1,000 for each committee on which they serve, a fee of $1,000 for each committee meeting such trustee attends in person and a fee of $500 for each committee meeting attended by teleconference. The Chair of the Audit Committee receives an additional annual fee of $10,000. The Chairs of the Corporate Governance and Nominating Committee and the Compensation Committee each receive an additional annual fee of $6,000. Additionally, all trustees are entitled to be reimbursed for travel and lodging expenses associated with attending Board and committee meetings. Trustees who are officers and full-time employees of the Trust are not entitled to receive any separate compensation for service as a trustee or committee member.

Pursuant to the Trust’s Amended and Restated Share Incentive Plan, each non-employee trustee is entitled to receive an annual grant of a 10-year option to purchase 5,000 common shares, exercisable at a price equal to the fair market value of the common shares on June 23rd of each year. Such options vest over a three-year period beginning with the date of grant as follows: 20% after the first year; 50% after two years; and 100% after three years.

COMPENSATION OF EXECUTIVE OFFICERS

Compensation Discussion and Analysis

Introduction

Our Compensation Discussion and Analysis addresses the compensation paid or awarded to our executive officers listed in the Summary Compensation Table that immediately follows this discussion. We refer to these executive officers as our “named executive officers.”

2007 Compensation

General

As is its practice, our Compensation Committee made its final compensation determinations for 2007 at a meeting held early the following year, in this case on March 27, 2008. This meeting followed several preliminary meetings of the Compensation Committee regarding 2007 compensation that were held during 2007 and early in 2008. These determinations include final determinations of cash bonuses and long-term incentive awards. At the same meeting, the Compensation Committee set base salaries and bonus and long-term incentive targets for 2008.

Compensation Objectives

The compensation paid or awarded to our named executive officers for 2007 was designed to meet the following objectives:

•  Provide competitive levels of compensation for executive officers, taking into account the size of our company and the compensation paid by members of a peer group consisting of a selected group of REITs in our market sectors. We refer to this objective as “competitive compensation.”

•  Create a compensation structure under which a meaningful portion of total compensation relates to the Trust’s actual performance, including long-term performance. We refer to this objective as “performance incentives.”

•  Encourage the aggregation and maintenance of meaningful equity ownership, and alignment of executive and shareholder interests, by providing compensation that ties the interests of executive officers to those of the Trust’s shareholders by linking a portion of executive compensation directly to increases in shareholder value. We refer to this objective as “stakeholder incentives.”

•  Provide compensation and benefits that will attract, motivate and retain superior talent over the long-term. We refer to this objective as “retention incentives.”

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We fashioned various components of our 2007 compensation payments and awards to meet these objectives as follows:

Type of Compensation	Objectives Addressed
Salary	Competitive Compensation
Bonus	Performance Incentives Competitive Compensation Retention Incentives
Long-Term Incentive Compensation — Restricted Share Awards and Options to Purchase Shares	Stakeholder Incentives Competitive Compensation Retention Incentives Performance Incentives

Determination of Competitive Compensation

In assessing competitive compensation, we relied on data provided to us by our independent compensation consultant, Towers Perrin. The compensation consultant provides this data to us on a regular basis. The compensation consultant employed its standard methodology to develop competitive compensation levels for seasoned executives having similar responsibilities, using comparative industry data derived from its executive compensation database, the NAREIT Compensation Survey and proxy data from a peer group consisting of certain office and industrial REITs. We believe that data regarding this peer group is useful with regard to an assessment of compensation for our named executive officers because it lends itself to a useful analysis of industry practices and to comparisons as to individual positions. The REITs that comprised the peer group for making decisions with respect to annual bonus and long-term incentive compensation are generally those that appear in the NAREIT Index as either “office,” “industrial” or “mixed,” subject to an appropriate market capitalization threshold. These REITs are listed below:

Alexandria Real Estate Equities, Inc.	Franklin Street Properties Corp.
AMB Property Corporation	Highwoods Properties, Inc.
BioMed Realty Trust, Inc.	HRPT Properties Trust
Boston Properties, Inc.	Kilroy Realty Corporation
Brandywine Realty Trust	Mack-Cali Realty Corporation
Corporate Office Properties Trust	Maguire Properties, Inc.
Cousins Properties Incorporated	Parkway Properties, Inc.
DCT Industrial Trust	ProLogis
Douglas Emmett, Inc.	PS Business Parks, Inc.
Duke Realty Corporation	SL Green Realty Corp.
Eastgroup Properties, Inc.	Washington Real Estate Investment Trust
First Industrial Realty Trust, Inc.

We have historically sought to maintain named executive officers’ salaries at or below the median of salaries for comparable executives based on trailing proxy data. Additionally, we have set our bonus and long-term incentive targets for named executive officers based on a review of the same type of data noted in the preceding paragraph. We check annually to see if our total cash compensation and total direct compensation are in line with the aforementioned industry data.

A comparison in early 2007 of the data to the Company’s 2006 salaries and target 2007 compensation indicated that:

•  In general, salaries for certain named executive officers were below market.

•  In general, total cash compensation and total direct compensation were below market.

•  In general, the bonus and long-term incentive targets for named executive officers were below market.

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Salaries

Base salaries are set by the Compensation Committee and are designed to be competitive with the salaries paid by peer group members. Changes in individual base salaries are based in part on the review of the report prepared by the independent compensation consultant, which included a review of peer group practices and other compensation data, as well as the individual’s responsibility, experience and performance and increases in cost of living indices. The weight given such factors by the Compensation Committee may vary from individual to individual. Base salaries are reviewed for adjustment annually. Based on the considerations described above, we adjusted the salaries of our named executive officers in early 2007 as follows:

Name	Salary*
William P. Hankowsky	$	525,000
George J. Alburger, Jr.	$	400,000
Robert F. Fenza	$	370,000
James J. Bowes	$	325,000
Michael T. Hagan	$	320,000

* Salary increases were approved on March 19, 2007, to be effective January 1, 2007.

As a result of these adjustments, all named executive officers’ salaries were within a range deemed appropriate by the Compensation Committee for comparable executives derived from the peer group discussed above, and in consideration of the individual’s performance and experience.

The salaries of the named executive officers were not adjusted in 2008.

Annual Bonus Program

While the principal objective of our annual non-equity incentive compensation program, which we refer to as our annual bonus program, is to provide a short-term performance incentive, we nevertheless consider competitive factors, including total cash compensation of peers.

For 2007, each named executive officer was eligible for a cash bonus award equal to a specified percentage of the officer’s annual salary (the “Base Bonus Percentage”) multiplied by a percentage (the “Bonus Multiplier”). For 2007, Base Bonus Percentages were 105% for the Chief Executive Officer and 85% for the other named executive officers. The achievement of the bonus was based on a three-part formula. The first part of the formula measured growth in the Trust’s Funds from Operations per common share (“FFO”) relative to the corresponding performance of a peer group for 2007 determined by the Committee (the “Peer Group”). With respect to this goal, the Trust’s actual FFO growth for 2007 was 1.9%. The Peer Group’s average FFO growth for the period was 1.9%. The second part of the formula measured the Trust’s performance against a broad group of operational metrics approved by the Committee, including performance against projected FFO, earnings per common share, net operating income and general and administrative expenses, as well as execution of the Trust’s capital plan. With respect to these measures, the goals pre-established by the Committee for 2007, and the actual performance by the Trust for the period, were as follows: FFO per common share (projected $3.10-$3.25; actual $3.18); earnings per common share (projected $2.16-$2.74; actual $1.80); net operating income (target $398.0 million; actual $398.35 million); general and administrative expenses (target $49.0 million; actual $53.5 million); and execution of the Trust’s capital plan, as to which actual performance exceeded target with respect to goals for acquisitions, dispositions, development and equity and debt financing activities. The third part of the formula measured individual performance relative to established goals approved by the Committee. To determine the bonus, the Committee applied an 80% weighting to the first two parts of the formula and a 20% weighting to the third part of the formula.

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The Committee, after considering the factors discussed above, made the following annual bonus awards to the named executive officers for 2007:

Name	Amount
William P. Hankowsky	$	496,912
George J. Alburger, Jr.	$	323,000
Robert E. Fenza	$	297,480
James J. Bowes	$	261,462
Michael T. Hagan	$	257,632

Consistent with a policy adopted by the Compensation Committee for all employees, our named executive officers have the option of taking common shares in lieu of a cash bonus awarded to them at the rate of shares equal to 120% of the cash value of the bonus or the portion thereof for which common shares are substituted, less applicable withholding tax. These shares are subject to restrictions on sale for one year after issuance. We believe that this inducement encourages share ownership, further aligns employee and shareholder interests and further supports our objective of retention, since the shares are restricted. Dividends are paid on common shares issued pursuant to such awards for 2007 performance and contractual restrictions on sale related to such awards will expire on March 28, 2009.

The annual bonus award payments are reflected in two separate columns of the Summary Compensation Table. The portion of the payment taken by the named executive officer in cash appears in the “Non-Equity Incentive Plan Compensation” column, while the portion which the named executive officer elected to take in shares appears in the “Share Awards” column.

Long-Term Incentive Program — Equity-Based Compensation

Historically, the Compensation Committee has operated a long-term incentive compensation (“LTI”) program for named executive officers, which is linked directly to relative total shareholder return (“TSR”). Under this program, the LTI awards made to named executive officers were derived from the Company’s TSR measured against a peer group determined by the Compensation Committee, with the amount of the award varying with relative performance.

While ultimately, as discussed below, the Compensation Committee elected not to make awards under this program, it was in place for 2007. Under this program, each named executive officer would be eligible pursuant to our LTI program to receive an LTI payment that is a function of salary, with each named executive officer able to earn a specified percentage of salary (215% for chief executive officer and 130% for chief operating officer, chief financial officer, chief investment officer and chief legal officer). The LTI payment was typically made in a combination of restricted shares and options, with an approximate 80%/20% split favoring the use of restricted shares. The base amount of the LTI payment would be subject to a multiplier in accordance with the schedule set forth below:

TSR Performance	LTI Award
25th Percentile of Peer Group	50% of LTI Target
Median of Peer Group	100% of LTI Target
75th Percentile of Peer Group	150% of LTI Target

However, in connection with the adoption of a new long-term incentive compensation plan for named executive officers, as discussed below in “2008 Compensation Developments,” the Committee has determined to make no award pursuant to the 2007 long-term incentive program. Had awards been made in accordance with the Committee’s past practice of implementing a floor to the formula at the 25th percentile (corresponding to the cap at the 75th percentile), the actual amounts that would have been earned as LTI and granted to the named executive

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officers on March 28, 2008 pursuant to the long-term incentive program, in terms of number of shares and options and the fair value thereof are as set forth in the table below:

	Shares				Options
Name	Number		Value(a)		Number		Value(b)
William P. Hankowsky		14,471	$	451,500		44,792	$	113,000
George J. Alburger, Jr.		6,667	$	208,000		20,635	$	52,000
Robert E. Fenza		6,166	$	192,400		19,087	$	48,100
James J. Bowes		5,416	$	169,000		16,766	$	42,250
Michael T. Hagan		5,333	$	166,400		16,508	$	41,600

(a)	Value based on the closing price of the common shares on the New York Stock Exchange on March 28, 2008 of $31.20.
(b)	Value based on a per option value of $2.52 arrived at a through a Black-Scholes analysis. See below for a description of the assumptions used in this analysis.

Overall 2007 Compensation

The tables that follow this Compensation Discussion and Analysis set forth the compensation that our named executive officers were paid in 2007. In certain cases, however, decisions regarding compensation for 2007 services performed by our named executive officers were made in March 2008. Furthermore, portions of the amounts shown in the Summary Compensation Table, under the Share Awards and Options Awards columns, relate to compensation paid for years prior to 2007, but appear in the table because under applicable accounting guidelines, the Company reflected an expense for this compensation in its 2007 financial statements. In order to provide additional clarification on all compensation paid in consideration of 2007 performance, we are providing the following table. It should not be read as a replacement of the tables appearing following this Compensation Discussion and Analysis, but as a supplement thereto. This table reflects the fact that except for the shares taken by certain named executive officers for in lieu of a cash bonus for 2007, no equity awards were made to our named executive officers for 2007. The amounts reflected in this table include:

•  2007 annual salary;

•  2007 annual bonus award (bonus paid in cash in 2008 in consideration of 2007 performance); and

•  Other compensation paid in 2007.

This table does not include amounts received by the named executive officers as dividends on awards granted for services performed prior to 2007, or as retention awards, that are shown as compensation in the Summary Compensation Table. It also does not include the options that were awarded on March 28, 2008, which are described below under “2008 Compensation Developments — 2008 Awards Under 2008 Plan.”

			Annual		All Other
Name	Salary		Bonus(a)		Compensation(b)		Total
William P. Hankowsky	$	525,000	$	496,912	$	27,274	$	1,049,186
George J. Alburger, Jr.	$	400,000	$	323,000	$	1,933	$	724,933
Robert E. Fenza	$	370,000	$	297,480	$	1,933	$	669,413
James J. Bowes	$	325,000	$	261,462	$	1,933	$	588,395
Michael T. Hagan	$	320,000	$	257,632	$	1,933	$	579,565

(a) Consistent with a policy adopted by the Compensation Committee for all employees, our named executive officers have the option of taking common shares in lieu of a cash bonus awarded to them at the rate of shares equal to 120% of the cash value of the bonus or the portion thereof for which common shares are substituted, less applicable withholding tax. Messrs. Hankowsky, Alburger and Hagan exercised this option as to 50%, 100% and 100%, respectively, of their entire annual bonuses and were awarded 6,327, 8,749 and 6,978 common shares, respectively.

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(b) Includes (i) amounts paid by the Company to purchase term life insurance policies for the Messrs. Hankowsky, Alburger, Fenza, Bowes and Hagan as follows: $1,433, $1,433, $1,433, $1,433 and $1,433, respectively; (ii) $25,341 in payments made to provide a car service to Mr. Hankowsky from time to time and (iii) $500 paid to each named executive officer as a holiday bonus; this amount is paid to each employee of the Company.

Share-Based Award Grant Practices

In 2007, we followed practices for the grant of share-based awards consistent with the manner in which we have historically granted such awards. Among other things, these practices encompass the following principles:

•  Share-based awards are to be approved annually by the Compensation Committee at a meeting set once the data required by the compensation formula is available, which generally occurs in the second half of March.

•  The annual share-based awards will not be made when the Compensation Committee is aware that executive officers or non-employee trustees are in possession of material, non-public information.

•  While share-based awards other than annual awards may be granted, such awards will not be made to executive officers if the Compensation Committee is aware that they are in possession of material, non-public information.

•  The Compensation Committee has established that options are granted only on the date the Compensation Committee meets to approve the grant and with an exercise price equal to the fair market value on the date of grant.

•  Backdating of options is prohibited.

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Management Severance Plan

We have a management severance plan for a group of senior officers, including our named executive officers. Various aspects of this plan are described under “Payments upon Termination Events, Including Following a Change of Control.” The management severance plan provides for payments and other benefits to each of the named executive officers if we terminate the executive’s employment without cause or if the executive terminates employment for “good reason” within two years following a change of control. The management severance plan also provides that if the total payments to any of our named executive officers under the terms of the management severance plan are subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, we will make an additional payment to the named executive officer, which payment is designed so that, after payment of all excise taxes and any other taxes payable in respect of the additional payment, the named executive officer will retain the same amount as if no excise tax had been imposed. See “Tax Considerations” below for further information regarding the excise tax reimbursement.

Tax Considerations

Under Section 162(m) of the Internal Revenue Code, a publicly-held corporation may not deduct more than $1 million in a taxable year for certain forms of compensation made to the chief executive officer and other officers listed on the Summary Compensation Table. Our policy is to seek to preserve the federal income tax deductibility of compensation paid to our executives, and our equity awards have generally been structured to preserve deductibility under Section 162(m). Nevertheless, we retain the flexibility to authorize compensation that may not be deductible if we believe it is in the best interests of our company. We believe that the compensation paid to our executives in 2007 was deductible.

As noted above, under the management severance plan, we will make additional payments to our named executive officers if payments to them resulting from a change of control are subject to the excise tax imposed by Section 4999 of the Internal Revenue Code. We included this provision in the management severance plan in order to enhance the motivation of our named executive officers to further increase shareholder value while remaining employed by us. We believe that these incentives would be frustrated by the possible imposition of the need for our executive officers to pay an excise tax upon the receipt of their change of control benefit under the management severance plan, and we do not believe that the provisions of the management severance plan should provide even a potential disincentive to our named executive officers’ pursuit of a change of control that otherwise might be in the best interests of the Trust and its shareholders. Accordingly, we determined to provide payment to reimburse our named executive officers for any excise taxes payable in connection with the change-in-control payment, as well as any taxes that accrue as a result of our reimbursement. We believe that this determination is appropriate given our named executive officers’ collective record in seeking to enhance shareholder value.

Role of Executive Officers in Determining Executive Compensation for Named Executive Officers

In connection with 2007 compensation, Towers Perrin provided data and Mr. Bowes provided general support to the Compensation Committee to assist it in determining compensation levels. Mr. Hankowsky made recommendations as to named executive officers but not as to his own compensation. While the Compensation Committee utilized this information, and valued Mr. Hankowsky’s observations with regard to other executive officers, the ultimate decisions regarding executive compensation were made by the Compensation Committee.

Share Ownership Guidelines

Share Ownership of Senior Officers

Consistent with an emphasis on higher standards of corporate governance, we believe that the investment community values share ownership by senior management and that, by holding an equity position in the Company, officers demonstrate their commitment to and belief in the long-term profitability of the Company. Accordingly, the Board believes that ownership of Company shares by officers should be encouraged, and has established ownership guidelines applicable to the Company’s officers at the Senior Vice President level and above.

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The policy states that each covered officer should seek to acquire and maintain a level of ownership of Company common shares (determined based on the fair market value of such shares from time to time as a multiple of the officer’s base salary) as follows: Chief Executive Officer: 5x; Chief Operating Officer, Chief Financial Officer, Chief Investment Officer and General Counsel: 3x; and Senior Vice Presidents: 1x.

The policy stipulates that the covered officers should work toward achieving these levels of ownership with the objective of meeting the requirements by January 31, 2008 or within five years of becoming subject to these requirements, as applicable. Each of the named executive officers met the prescribed levels as of that date. Once a covered officer has achieved the targeted level of share ownership, the policy states that he or she (1) should maintain at least that level of ownership for the duration of his or her tenure with the Company and (2) should, within three years after receiving an increase in salary or a promotion, seek to achieve the resulting greater target level of ownership.

The policy recognizes the following sources of share ownership for purposes of determining whether the above ownership target is satisfied:

•  Company common shares acquired by a covered officer, including unvested restricted share awards;

•  Units of limited partnership interest in Liberty Property Limited Partnership; and

•  Company common shares owned directly by a covered officer’s spouse or minor children who reside with the covered officer, or held in a trust established for estate and/or tax planning purposes that is revocable by the covered officer and/or his or her spouse.

For purposes of determining whether the ownership target is satisfied, shares underlying outstanding options are not included.

The policy further mandates that until such time as a covered officer has attained the applicable target ownership level, he or she must retain common shares obtained as a result of a share award, unless the Board otherwise permits.

Share Ownership of Trustees

The Board believes that trustees should be shareholders and have a financial stake in the Company. In furtherance of this belief, non-management trustees are paid a portion of their annual fees in the Company’s common shares.

Additionally, the trustees are expected to own an amount of Company common shares equal in value to five times the annual retainer paid to trustees. The target date for acquiring such ownership is May 2010.

Perquisites and Other Personal Benefits

In addition to the components noted above, our compensation program may also include various benefits, such as health insurance plans and pension, profit sharing and retirement plans in which substantially all of the Trust’s employees participate. At the present time, the only plans in effect are health, dental, life and disability insurance plans, a 401(k) plan, a flexible spending insurance program, an employee share purchase plan and the severance plan for certain senior officers of the Trust described under “Management Severance Plan.”

In addition, in 2007 we reimbursed Mr. Hankowsky for the occasional use of a car service. The Company determined to reimburse Mr. Hankowsky for the car service because it determined that in those instances it was economically more productive for him to be able to continue to work while traveling in the car rather than be occupied by the task of driving.

2008 Compensation Developments

At a meeting held on March 27, 2008, the Compensation Committee (the “Committee”) of the Board of Trustees (the “Board”) of Liberty Property Trust (the “Company”) approved the Liberty Property Trust 2008 Long-Term Incentive Plan (the “2008 Plan”), with the purpose of enhancing and refining the performance incentives provided to the Named Executive Officers. The 2008 Plan provides for an annual aggregate award (each, an

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“Award”) composed of (i) a grant of restricted stock units (approximately two-thirds of the total targeted expected value of the Award) and (ii) an grant of stock options (approximately one-third of the total targeted expected value of the Award). When the Company’s common shares of beneficial interest, $0.001 par value (the “Common Shares”) are issued with respect to the Awards they underlie, they will be issued under the Company’s Amended and Restated Share Incentive Plan, and shall generally be subject to the terms and conditions of that plan.

Awards under the 2008 Plan will have the following general features:

Restricted Stock Units.  A “restricted stock unit” (or “RSU” or “phantom stock”) under the 2008 Plan consists of a legally-binding promise to pay the executive a certain number of the Common Shares at the end of the Award Period (as defined below), to the extent certain annual performance criteria are met or exceeded.

The restricted stock units shall be eligible to be earned over the three-year period beginning on the date of grant (the “Award Period”), and shall be further subdivided into (i) a portion earned ratably over the Award Period on a year-by-year basis (each year constituting a related “Performance Period”), using a specific performance measure (the “First Portion”), and (ii) a portion earned over the full Award Period, using another specific performance measure (the “Second Portion”). Neither portion, however, would be payable until the end of the three-year Award Period. Any dividends that accumulate prior to the end of the Award Period will be paid if and when the related restricted stock units are redeemed and paid.

Under the 2008 Plan, the Committee has the ability to utilize a wide variety of performance measures on which to base each particular year’s grant of restricted stock units, and will act each year to designate the specific performance measures for that year. For the Awards granted under the 2008 Plan for 2008, as discussed more specifically below, these two measures are based, respectively, on the amount of the Company’s “funds from operations” (the “FFO Portion”) for the First Portion of the Award, and its total shareholder return (the “TSR Portion”) as compared to a relevant peer group for the Second Portion of the Award. The Committee has adopted a performance metrics schedule for the 2008 Award, listing the threshold at which actual FFO and TSR will accrue, in relation to the specified target levels. These levels provide for specified awards upon attainment of stipulated percentages of the target level with a maximum payment of 200%, with the Compensation Committee retaining discretion to reduce the award from the prescribed level as it deems fit.

The restricted stock units that comprise the First Portion will be split into three equal pieces, corresponding to each of the three years in the relevant Award Period. Depending on how each year’s performance compares to the budget performance for that year using an annually-determined performance schedule, a portion of the related restricted stock units will be deemed earned for that year, and will be payable to the participant in Common Shares (under the terms of the Company’s Amended and Restated Share Incentive Plan) at the end of the Award Period. The restricted stock units that comprise the Second Portion are eligible to be earned on the basis of total shareholder return for the relevant Award Period, using a pre-determined performance schedule. The Second Portion will be deemed earned and payable to the participant in Common Shares (under the terms of the Company’s Amended and Restated Share Incentive Plan) at the end of the Award Period.

If a recipient of an Award quits or is discharged for cause prior to the end of the Award Period, all restricted stock units will be forfeited, even if they have (in the case of the First Portion that accrues on a year-by-year basis) already been earned. If the recipient of the Award is, instead, terminated without cause, or terminates by reason of death, disability or “Retirement” (as defined in the Company’s Amended and Restated Share Incentive Plan) prior to the end of the Award Period, units would be payable at the end of the Award Period based on actual attainment within each Performance Period, and would not be pro-rated for short service. The 2008 Plan also includes several common restrictive covenants and other provisions, subject to the Committee’s discretion, that would trigger forfeiture of an Award.

Options.  Stock options granted under the 2008 Plan will be vested (and thus exercisable) solely on the basis of time and continued employment, with no regard to any performance criteria, at a rate of 20% of the total option component at the end of the first anniversary of the date of grant, 30% on the second anniversary, and the remainder on the third anniversary. In addition, they will become immediately vested and exercisable in full if the optionee ceases to be employed by, or provide services to, the Company by reason of death, disability, retirement or termination without cause. These terms and conditions are, generally, the terms and conditions that currently govern

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options granted to named executive officers as part of the Company’s LTI program, and thus do not represent a change in that component of the LTI program.

2008 Awards Under 2008 Plan.  Also on March 27, 2008, the Committee made Awards under the 2008 Plan, which Awards were granted as of the close of business on March 28, 2008. The Awards consisted of the following:

			Number of		Number of
			RSUs in		RSUs in
	Number of		First Portion/FFO		Second Portion/TSR
Name	Options(1)		Portion(2)		Portion(3)
William P. Hankowsky		166,667		13,462		13,462
George J. Alburger, Jr.		76,720		6,197		6,197
Robert E. Fenza		70,966		5,732		5,732
James J. Bowes		62,335		5,035		5,035
Michael T. Hagan		61,376		4,957		4,957

(1)	The options have an exercise price of $31.20, the closing price of the Common Shares on the New York Stock Exchange on March 28, 2008, the date of grant.
(2)	As described above, the RSUs constituting the First Portion are split into three equal pieces, corresponding to each of the three years in the relevant Award Period. One-third of the RSUs may be earned with respect each year in the Award Period, but will be payable to the participant at the end of the Award Period.
(3)	As described above, the RSUs constituting the Second Portion are eligible to be earned on the basis of TSR for the full Award Period. The determination of whether the Second Portion is earned and payable shall be made at the end of the Award Period.

Summary Compensation Table

The following table shows, for the years ended December 31, 2007 and 2006, the compensation paid or accrued by the Trust and its subsidiaries, including the Operating Partnership, to our named executive officers.

											Non-Equity
							Share		Option		Incentive Plan		All Other
Name and Principal Position	Year		Salary		Bonus		Awards(1)		Awards(2)		Compensation(3)		Compensation(4)		Total
William P. Hankowsky		2007	$	525,000	$	500	$	896,223	$	105,412	$	248,456	$	170,570	$	1,946,161
President and Chief		2006	$	500,000	$	500	$	848,170	$	117,162	$	—	$	171,675	$	1,637,507
Executive Officer
George J. Alburger, Jr.		2007	$	400,000	$	500	$	923,770	$	83,232	$	—	$	92,669	$	1,500,171
Executive Vice President		2006	$	350,000	$	500	$	572,928	$	56,337	$	—	$	94,706	$	1,074,471
and Chief Financial Officer
Robert E. Fenza		2007	$	370,000	$	500	$	229,714	$	45,661	$	297,480	$	34,346	$	977,701
Executive Vice President		2006	$	355,000	$	500	$	320,631	$	55,533	$	70,610	$	40,760	$	843,034
and Chief Operating Officer
James J. Bowes		2007	$	325,000	$	500	$	173,154	$	38,852	$	261,462	$	27,442	$	826,410
General Counsel		2006	$	305,000	$	500	$	173,142	$	45,181	$	121,329	$	30,929	$	676,081
Michael T. Hagan		2007	$	320,000	$	500	$	414,263	$	22,609	$	—	$	21,251	$	778,623
Chief Investment Officer		2006	$	275,000	$	500	$	194,851	$	21,881	$	—	$	14,914	$	507,146

(1) This column indicates the dollar amount recognized as compensation expense by the Trust for financial statement reporting purposes during 2007 and 2006 under SFAS 123(R) with respect to restricted shares granted to the named executive officer. Accordingly, it includes amounts from awards made during and prior to the referenced year. These amounts reflect the Company’s accounting expense for these awards and do not correspond to the actual amounts received by the named executive officers as compensation for the referenced year.

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	A portion of the amounts shown in this column reflects the elections by Messrs. Hankowsky, Alburger, Fenza and Hagan, consistent with a policy adopted by the Trust’s Compensation Committee with respect to employee annual performance non-equity incentive compensation, which we sometimes refer to as annual bonus, to receive common shares in lieu of cash for all or part of their annual bonus compensation for 2007 or 2006. By making such elections, these individuals received shares equal to 120% of the cash value of such bonus or portion thereof, less applicable withholding tax (the “Bonus Value”). Each executive received the number of common shares able to be purchased with the dollar amount of the Bonus Value based on the closing price of the common shares on the New York Stock Exchange on March 28, 2008 ($31.20) for bonuses included in 2007 compensation or March 19, 2007 ($49.74) for bonuses included in 2006 compensation. The dollar amounts of Bonus Value recognized in accordance with SFAS 123(R) during 2007 and 2006 are reflected under the Share Awards column. Pursuant to these elections, Messrs. Hankowsky, Alburger and Hagan were awarded 6,327, 8,749 and 6,978 common shares, respectively, as 2007 compensation and 3,920, 2,029 and 1,858 common shares, respectively, as 2006 compensation, and Mr. Fenza was awarded 1,029 shares as 2006 compensation. Dividends will be paid on the common shares issued pursuant to such awards. The contractual restrictions on sale related to such awards will expire on March 28, 2009 for the awards made as 2007 compensation and expired on March 19, 2008 for the awards made as 2006 compensation.
(2)	This column indicates the dollar amounts recognized as compensation expense by the Trust for financial statement reporting purposes during 2007 and 2006 under SFAS 123(R) with respect to all options to purchase common shares granted to the named executive officer, regardless of the date of grant. Accordingly, it includes amounts from grants made during and prior to the referenced years. These amounts reflect the Company’s accounting expense for these awards in the referenced years and do not correspond to the actual amounts received by the named executive officers as compensation for that year. For information regarding the assumptions made in the valuations of these amounts, see Footnote 10 to the Trust’s financial statements for the year ended December 31, 2007 included in the Company’s Annual Report on Form 10-K for such year.
(3)	This column shows amounts of annual performance non-equity incentive compensation for 2007 and 2006 taken by the named executive officers in cash.
(4)	Consists of amounts paid by the Company to purchase term life insurance policies for the Messrs. Hankowsky, Alburger, Fenza, Bowes and Hagan as follows: $1,433, $1,433, $1,433, $1,433 and $1,433, respectively, for 2007 and $1,500, $1,500, $1,500, $1,500 and $1,436, respectively for 2006. Includes dividends paid on unrestricted shares to Messrs. Hankowsky, Alburger, Fenza, Bowes and Hagan as follows: $59,642, $31,601, $32,913, $26,010 and $19,819, respectively, for 2007 and $74,419, $37,169, $39,260, $29,429 and $13,478, respectively, for 2006. Includes unvested reinvested dividends paid on unvested restricted shares to Messrs. Hankowsky and Alburger as follows: $84,154 and $59,635, respectively, for 2007 and $79,074 and $56,037, respectively, for 2006. Includes $25,341 and $16,682 in payments made during 2007 and 2006, respectively, to provide a car service to Mr. Hankowsky from time to time.

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Grants of Plan Based Awards

The following table summarizes plan based awards made to each of the named executive officers for 2007 under the Trust’s compensation plans:

									All Other		All Other
									Stock		Option				Grant Date
									Awards:		Awards:		Exercise		Fair
									Number of		Number of		or Base		Value of
			Estimated Possible Payouts						Shares of		Securities		Price of		Share and
			Under Non-Equity Incentive Plan Awards(2)						Stock or		Underlying		Option		Option
Name	Grant Date(1)		Threshold		Target		Maximum		Units(3)		Options(4)		Awards		Awards(5)
William P. Hankowsky		N/A		—	$	551,250	$	826,875		—		—		—		—
		3/19/2007		—		—		—		8,645		—		—	$	430,000
		3/19/2007		—		—		—		—		18,926	$	49.74	$	107,500
George J. Alburger, Jr.		N/A		—	$	340,000	$	510,000		—		—		—		—
		3/19/2007		—		—		—		3,659		—		—	$	182,000
		3/19/2007		—		—		—		—		8,011	$	49.74	$	45,500
Robert E. Fenza		N/A		—	$	314,500	$	471,750		—		—		—		—
		3/19/2007		—		—		—		3,711		—		—	$	184,600
		3/19/2007		—		—		—		—		8,125	$	49.74	$	46,150
James J. Bowes		N/A		—	$	276,250	$	414,375		—		—		—		—
		3/19/2007		—		—		—		3,189		—		—	$	158,600
		3/19/2007		—		—		—		—		6,981	$	49.74	$	39,650
Michael T. Hagan		N/A		—	$	272,000	$	408,000		—		—		—		—
		3/19/2007		—		—		—		2,875		—		—	$	143,000
		3/19/2007		—		—		—		—		6,294	$	49.74	$	35,750

(1)	March 19, 2007 represents (a) the date on which our Board set the range of potential annual bonus awards for 2007 performance by Named Executive Officers, and (b) the date on which it made grants of restricted shares that comprised the Long-Term Incentive (“LTI”) payment earned by the named executive officers in 2006. These restricted shares awards were determined in reference to the range of potential LTI payments for 2006 performance established by the Board at its March 19, 2007 meeting. At the March 19, 2007 meeting, the Board also established the range of potential LTI payments for 2007 performance. Ultimately, as discussed in Compensation Discuss and Analysis, no grants of restricted shares were made for 2007 performance.
(2)	This award reflects the range of potential annual bonus available to be earned by the named executive officer for 2007. The actual amounts earned for 2007 pursuant to the annual bonus program are set forth in the Summary Compensation Table under “Non-Equity Incentive Plan Compensation” (or, where the Named Executive chose to take all or a portion of his annual bonus in the form of restricted shares, under “Share Awards”), and are also set forth in the table below. Each named executive officer’s annual bonus is a function of salary, with each named executive officer able to earn a specified percentage of his salary (105% for chief executive officer and 85% for chief operating officer, chief financial officer, chief investment officer and chief legal officer). The base amount of the bonus was then subject to a multiplier calculated in accordance with the three-part formula discussed under “Compensation Discussion and Analysis — Annual Bonus Program.”
	The dollar amounts of the actual awards under the annual bonus program for 2007 performance, determined by the Compensation Committee at its March 28, 2008 meeting, were as follows:

Name	Dollar Value(a)
William P. Hankowsky	$	496,912
George J. Alburger, Jr.	$	323,000
Robert E. Fenza	$	297,480
James J. Bowes	$	261,462
Michael T. Hagan	$	257,632

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(a)  See footnote (1) to the Summary Compensation Table for a discussion of the election by some of the Named Executive Officers to receive common shares in lieu of cash for all or part of their annual bonus compensation for 2007.

(3)	This column shows the restricted share component of the LTI payment made on March 19, 2007 related to 2006 performance. The shares will vest ratably over a five-year period.
(4)	This column shows the share option component of the LTI payment made on March 19, 2007 related to 2006 performance. The options will vest 20% on the first anniversary of the date of grant, 50% on the second anniversary and 100% on the third anniversary.
(5)	The value of the restricted share awards was based on the closing price of the common shares on the New York Stock Exchange on March 19, 2007 of $49.74. The value of the share options reflects a per option value of $5.68 arrived at a through a Black-Scholes analysis. The assumptions used in this analysis were as follows:

•  5 year expected life

•  0.183 expected volatility

•  4.47% risk free interest rate

•  5.16% dividend yield

Outstanding Equity Awards at Fiscal Year-End

The following table contains information concerning outstanding equity awards held by each of the named executive officers as of December 31, 2007:

												Share Awards
																			Equity
																			Incentive
																	Equity		Plan
	Option Awards																Incentive		Awards:
						Equity											Plan		Market or
						Incentive											Awards:		Payout
						Plan									Market		Number of		Value of
						Awards:									Value of		Unearned		Unearned
						Number of						Number of			Shares or		Shares,		Shares,
						Securities						Shares or			Units of		Units or		Units or
	Number of					Underlying						Units of			Shares		Other		Other
	Securities Underlying					Unexercised		Option		Option		Shares That			That		Rights That		Rights That
	Unexercised Options					Unearned		Exercise		Expiration		Have Not			Have Not		Have Not		Have Not
Name	Exercisable		Unexercisable			Options		Price		Date		Vested			Vested(1)		Vested		Vested(1)
William P. Hankowsky		50,000		—			—	$	27.875		1/2/2011		—			—		—		—
		100,362		—			—	$	30.10		2/28/2012		—			—		—		—
		34,909		—			—	$	31.22		2/28/2013		—			—		—		—
		49,172		—			—	$	43.45		3/16/2014		—			—		—		—
		15,275		15,275	(2)		—	$	40.35		3/16/2015		—			—		—		—
		2,996		11,986	(3)		—	$	48.54		3/16/2016		—			—		—		—
		—		18,926	(4)		—	$	49.74		3/19/2017		—			—		—		—
		—		—			—		—		—		68,026	(5)	$	1,959,829		—		—
George J. Alburger, Jr.		96,000		—			—	$	21.875		2/26/2009		—			—
		128,040		—			—	$	22.6875		2/29/2010		—			—		—		—
		51,674		—			—	$	26.77		3/16/2011		—			—		—		—
		100,362		—			—	$	30.10		2/28/2012		—			—		—		—
		25,649		—			—	$	31.22		2/28/2013		—			—		—		—
		22,083		—			—	$	43.45		3/16/2014		—			—		—		—
		6,295		6,295	(2)		—	$	40.35		3/16/2015		—			—		—		—
		1,254		5,015	(3)		—	$	48.54		3/16/2016							—		—
		—		8,011	(4)		—	$	49.74		3/19/2017		—			—		—		—
		—		—			—		—		—		40,194	(6)	$	1,157,989		—		—

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												Share Awards
																			Equity
																			Incentive
																	Equity		Plan
	Option Awards																Incentive		Awards:
						Equity											Plan		Market or
						Incentive											Awards:		Payout
						Plan									Market		Number of		Value of
						Awards:									Value of		Unearned		Unearned
						Number of						Number of			Shares or		Shares,		Shares,
						Securities						Shares or			Units of		Units or		Units or
	Number of					Underlying						Units of			Shares		Other		Other
	Securities Underlying					Unexercised		Option		Option		Shares That			That		Rights That		Rights That
	Unexercised Options					Unearned		Exercise		Expiration		Have Not			Have Not		Have Not		Have Not
Name	Exercisable		Unexercisable			Options		Price		Date		Vested			Vested(1)		Vested		Vested(1)
Robert E. Fenza		107,649		—			—	$	30.10		2/28/2012		—			—		—		—
		27,768		—			—	$	31.22		2/28/2013		—			—		—		—
		23,603		—			—	$	43.45		3/16/2014		—			—		—		—
		6,449		6,450	(2)		—	$	40.35		3/16/2015		—			—		—		—
		1,285		5,138	(3)		—	$	48.54		3/16/2016		—			—		—		—
		—		8,125	(4)		—	$	49.74		3/19/2017		—			—		—		—
		—		—			—		—		—		14,867	(7)	$	428,318		—		—
James J. Bowes		2,000		—			—	$	21.875		2/26/2009		—			—		—		—
		90,695		—			—	$	22.6875		2/29/2010		—			—		—		—
		19,085		—			—	$	26.77		3/16/2011		—			—		—		—
		83,333		—			—	$	30.10		2/28/2012		—			—		—		—
		16,119		—			—	$	31.22		2/28/2013		—			—		—		—
		19,371		—			—	$	43.45		3/16/2014		—			—		—		—
		5,522		5,522	(2)		—	$	40.35		3/16/2015		—			—		—		—
		1,100		4,399	(3)		—	$	48.54		3/16/2016		—			—		—		—
		—		6,981	(4)		—	$	49.74		3/19/2017		—			—		—		—
		—		—			—		—		—		11,082	(8)	$	319,272		—		—
Michael T. Hagan		8,940		—			—	$	43.45		3/16/2014		—			—		—		—
		2,535		2,536	(2)		—	$	40.35		3/16/2015		—			—		—		—
		783		3,134	(3)		—	$	48.54		3/16/2016		—			—		—		—
		—		6,294	(4)		—	$	49.74		3/19/2017		—			—		—		—
		—		—			—		—		—		10,639	(9)	$	306,510		—		—

(1)	Value is calculated by multiplying the number of shares subject to vesting by $28.81, the closing price of the common shares on the New York Stock Exchange on December 31, 2007.
(2)	Represents options granted on March 16, 2005 with respect to the fiscal year ended December 31, 2004. Such options became exercisable up to 20% after the first year and 50% after two years, and will become exercisable 100% after three years.
(3)	Represents options granted on March 16, 2006 with respect to the fiscal year ended December 31, 2005. Such options became exercisable up to 20% after the first year, and will become exercisable 50% after two years and 100% after three years.
(4)	Represents options granted on March 19, 2007 with respect to the fiscal year ended December 31, 2006. Such options will become exercisable up to 20% after the first year, 50% after two years and 100% after three years.
(5)	These shares will vest as follows:

•  3,139 shares on February 28, 2008 (a 20% portion of the annual grant of 15,695 shares made on February 28, 2003);

•  6,234 shares on March 16, 2008 and 6,235 on March 16, 2009 (consisting of 20% portions of annual grants of 13,671, 11,145 and 6,358 shares made, respectively, on March 16, 2004, 2005 and 2006);

•  3,500 shares on March 16, 2010 (consisting of 20% portions of annual grants of 11,145 and 6,358 shares made, respectively, on March 16, 2005 and 2006);

•  1,274 shares on March 16, 2011 (a 20% portion of the annual grant of 6,358 shares made on March 16, 2006);

•  1,729 shares on each of March 19, 2008, 2009, 2010, 2011 and 2012 (consisting of 20% portions of annual grant of 8,645 shares made on March 19, 2007); and

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•  3,920 shares on March 19, 2008 (shares granted on March 19, 2007 pursuant to the Trust’s bonus program, under which the executive can elect to receive restricted common shares, subject to a one year vesting period, in lieu of a portion of his annual bonus).

The remaining 35,079 shares will vest on March 17, 2013 (Mr. Hankowsky’s sixty-second (62nd) birthday). These shares consist of 30,000 shares granted to Mr. Hankowsky on March 7, 2005 under the Share Incentive Plan, as well as dividends of an aggregate of 5,079 shares paid in connection with the Trust’s quarterly dividends to shareholders since the date of grant. The purpose of the award was to design an incentive that would enhance the ability of the Trust to retain the services of Mr. Hankowsky. The restrictions on these shares will lapse as to all such shares on Mr. Hankowsky’s sixty-second (62nd) birthday, provided that Mr. Hankowsky continues to be employed by, or is in the service of, the Trust as of such date. The shares will also vest upon Mr. Hankowsky’s death or Disability (as defined in the Share Incentive Plan), should either occur prior to the date described in the preceding sentence. Dividends are paid on the full amount of the shares, without regard to vesting, from the date of grant, and are automatically reinvested, through the Trust’s Dividend Reinvestment and Share Purchase Plan, in common shares, which are subject to the restrictions described above.

(6)

These shares will vest as follows:

•  2,307 shares on February 28, 2008 (a 20% portion of the annual grant of 11,531 shares made on February 28, 2003);

•  2,678 shares on March 16, 2008 and 2,677 shares on March 16, 2009 (consisting of 20% portions of annual grants of 6,139, 4,593 and 2,661 shares made, respectively, on March 16, 2004, 2005 and 2006);

•  1,453 shares on March 16, 2010 (consisting of 20% portions of annual grants of 4,593 and 2,661 shares made, respectively, on March 16, 2005 and 2006);

•  533 shares on March 16, 2011 (a 20% portion of the annual grant of 2,661 shares made on March 16, 2006);

•  731 shares on each of March 19, 2008, 2009, 2010 and 2011 and 735 shares on March 19, 2012 (consisting of 20% portions of annual grant of 3,659 shares made on March 19, 2007); and

•  2,029 shares on March 19, 2008 (shares granted on March 19, 2007 pursuant to the Trust’s bonus program, under which the executive can elect to receive restricted common shares, subject to a one year vesting period, in lieu of a portion of his annual bonus).

The remaining 24,858 shares will vest on April 27, 2009 (Mr. Alburger’s sixty-second (62nd) birthday). These shares consist of 20,000 shares granted to Mr. Alburger on March 7, 2005 under the Share Incentive Plan, as well as dividends of an aggregate of 4,858 shares paid in connection with the Trust’s quarterly dividends to shareholders since the date of grant. The purpose of the award was to design an incentive that would enhance the ability of the Trust to retain the services of Mr. Alburger. The restrictions on these shares will lapse as to all such shares on Mr. Alburger’s sixty-second (62nd) birthday, provided that Mr. Alburger continues to be employed by, or is in the service of, the Trust as of such date. The shares will also vest upon Mr. Alburger’s death or Disability (as defined in the Share Incentive Plan), should either occur prior to the date described in the preceding sentence. Dividends are paid on the full amount of the shares, without regard to vesting, from the date of grant, and are automatically reinvested, through the Trust’s Dividend Reinvestment and Share Purchase Plan, in common shares, which are subject to the restrictions described above.

(7)

These shares will vest as follows:

•  2,496 shares on February 28, 2008 (a 20% portion of the annual grant of 12,484 shares made on February 28, 2003);

•  2,798 shares on March 16, 2008 and 2,800 shares on March 16, 2009 (consisting of 20% portions of annual grants of 6,562, 4,706 and 2,726 shares made, respectively, on March 16, 2004, 2005 and 2006);

•  1,487 shares on March 16, 2010 (consisting of 20% portions of annual grants of 4,706 and 2,726 shares made, respectively, on March 16, 2005 and 2006);

•  546 shares on March 16, 2011 (a 20% portion of the annual grant of 2,726 shares made on March 16, 2006);

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•  742 shares on each of March 19, 2008, 2009, 2010 and 2011 and 743 shares on March 19, 2012 (consisting of 20% portions of annual grant of 3,711 shares made on March 19, 2007); and

•  1,029 shares on March 19, 2008 (shares granted on March 19, 2007 pursuant to the Trust’s bonus program, under which the executive can elect to receive restricted common shares, subject to a one year vesting period, in lieu of a portion of his annual bonus).

(8) These shares will vest as follows:

•  1,451 shares on February 28, 2008 (a 20% portion of the annual grant of 7,247 shares made on February 28, 2003);

•  2,348 shares on March 16, 2008 and 2,349 shares on March 16, 2009 (consisting of 20% portions of annual grants of 5,386, 4,029 and 2,334 shares made, respectively, on March 16, 2004, 2005 and 2006);

•  1,275 shares on March 16, 2010 (consisting of 20% portions of annual grants of 4,029 and 2,334 shares made, respectively, on March 16, 2005 and 2006);

•  470 shares on March 16, 2011 (a 20% portion of the annual grant of 2,334 shares made on March 16, 2006); and

•  637 shares on each of March 19, 2008, 2009, 2010 and 2011 and 641 shares on March 19, 2012 (consisting of 20% portions of annual grant of 3,189 shares made on March 19, 2007).

(9) These shares will vest as follows:

•  461 shares on February 28, 2008 (a 20% portion of the annual grant of 2,289 shares made on February 28, 2003);

•  1,199 shares on March 16, 2008 and 1,200 shares on March 16, 2009 (consisting of 20% portions of annual grants of 2,486, 1,850 and 1,662 shares made, respectively, on March 16, 2004, 2005 and 2006);

•  702 shares on March 16, 2010 (consisting of 20% portions of annual grants of 1,850 and 1,662 shares made, respectively, on March 16, 2005 and 2006);

•  334 shares on March 16, 2011 (a 20% portion of the annual grant of 1,662 shares made on March 16, 2006);

•  977 shares on each of March 19, 2008, 2009, 2010, 2011 and 2012 (consisting of 20% portions of annual grant of 2,875 shares made on March 19, 2007 and a special grant of 2,010 shares, also made on March 19, 2007, in recognition of the accomplishment of the Company’s acquisition and disposition goals); and

•  1,858 shares on March 19, 2008 (shares granted on March 19, 2007 pursuant to the Trust’s bonus program, under which the executive can elect to receive restricted common shares, subject to a one year vesting period, in lieu of a portion of his annual bonus).

Option Exercises and Shares Vested

During 2007, the number of shares acquired and value realized on the exercise of option awards and the number of shares acquired and the value realized on vesting of share awards for each of the named executive officers were as follows:

	Option Awards				Share Awards
	Number of				Number of
	Shares				Shares
	Acquired on		Value Realized		Acquired on		Value Realized
Name	Exercise		on Exercise		Vesting		on Vesting
William P. Hankowsky		—		—		16,312	$	816,160
George J. Alburger, Jr.		42,806	$	1,038,045		9,607	$	482,276
Robert E. Fenza		110,451	$	2,437,370		6,612	$	334,220
James J. Bowes		37,500	$	1,077,562		4,819	$	243,076
Michael T. Hagan		—		—		3,778	$	188,110

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Equity Compensation Plan Information

The following table provides information regarding our compensation plans under which our equity securities are authorized for issuance. The information provided is as of December 31, 2007.

					Number of
					Securities Remaining
					Available for
					Future Issuance
	Number of				Under Equity
	Securities to				Compensation Plans
	be Issued		Weighted-Average Exercise		(Excluding Securities
	Upon Exercise		Price of		Reflected in
	of Outstanding		Outstanding Options,		Column 1
	Options, Warrants		Warrants and		of this
Plan Category	and Rights(1)		Rights		table)(1)
Equity Compensation Plans Approved by Security Holders		2,416,236	$	33.67		2,738,176
Equity Compensation Plans Not Approved by Security Holders		—		—		—
Total		2,416,236	$	33.67		2,738,176

(1) Does not reflect restricted shares and options awarded in 2008 with respect to the fiscal year ended December 31, 2007. Taking into account restricted shares and options subject to awards under the 2008 Plan made on March 28, 2008 the numbers listed above would be as follows: 3,074,213 (number of shares to be issued); $33.14 (weighted-average price); and 1,929,440 (number of securities remaining available).

Payments upon Termination Events, Including Following a Change of Control

The Trust has a management severance plan for a group of senior officers of the Trust, including Messrs. Hankowsky, Alburger, Fenza, Bowes and Hagan. The tables below reflect the amounts that would be payable to the named executive officers upon various termination events, including pursuant to the management severance plan. These tables show the amount of compensation payable to each of the named executive officers in the event of termination of such executive’s employment, in each of the following cases: termination by the Trust not for Cause (as defined in the management severance plan and described below), retirement, in the event of death or disability and following a Change of Control (as defined in the management severance plan and described below). The amounts indicated are based on the assumption that the termination occurred as of December 31, 2007, on which date the closing price of the common shares on the New York Stock Exchange was $28.81. Actual amounts payable would vary based on the date of the named executive officer’s termination and can only be finally determined at that time.

In general, the management severance plan applies similarly to each of the named executive officers as follows: In the event of (i) the termination of the named executive officer other than “for cause” or (ii) the named executive officer’s voluntary termination of his employment for “good reason,” in either case within two years following a “change of control,” the named executive officer would receive the following: (a) an amount equal to 2.99 times the sum of his current annual base salary plus the largest annual performance bonus paid to him over the previous five years; (b) the pro rata portion, through the date of termination, of unpaid performance bonus for the year in which the termination occurs; (c) immediate vesting of outstanding options and restricted shares; (d) an amount equal to the Trust’s maximum contribution under the 401(k) plan for a period of three years, including the year in which termination occurs; (e) immediate vesting of contributions previously made by the Trust to the individual’s account under the 401(k) plan; and (f) continuation of employee group benefits coverage for a period of three years after the date of termination. In addition, under the severance plan, if any payments made to a covered person would result in an excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), the named executive officer would become entitled to receive a tax reimbursement payment that

25

would put him in the same financial position after the application of the excise tax as he would have been in if the excise tax did not apply to such amounts.

Payments Made Upon Termination by Trust Not for Cause

Regardless of the manner in which a named executive officer’s employment terminates, he is entitled to receive amounts earned during his term of employment. Such amounts include:

•  non-equity incentive compensation earned during the fiscal year;

•  unused vacation pay

Payments Made Upon Retirement

Under the terms of the agreements pursuant to which the named executive officers have been granted their options and restricted shares, the vesting of unvested options or restricted shares at the retirement of the named executive officer is generally based upon a sliding scale taking into account the named executive officer’s age and length of service to the Trust. The following table illustrates this scale:

	Minimum Years
Age	of Service to Trust		Amount to Vest
55-56		10	Options and restricted shares that would have vested in accordance with their terms during the 12 month period after the named executive officer’s retirement shall vest as of the date of retirement
57-58		8	Options and restricted shares that would have vested in accordance with their terms during the 24 month period after the named executive officer’s retirement shall vest as of the date of retirement
59-60		6	Options that would have vested in accordance with their terms during the 24 month period after the named executive officer’s retirement shall vest as of the date of retirement; restricted shares that would have vested in accordance with their terms during the 36 month period after the named executive officer’s retirement shall vest as of the date of retirement
61-62		4	Options and restricted shares that would have vested in accordance with their terms during the 48 month period after the named executive officer’s retirement shall vest as of the date of retirement
63-64		2	Options and restricted shares that would have vested in accordance with their terms during the 60 month period after the named executive officer’s retirement shall vest as of the date of retirement
65 or more		—	All options and restricted shares not vested at the date of retirement shall vest as of the date of retirement

As of December 31, 2007, the named executive officers were the following ages and had the following years of service to the Trust:

			Years
Name	Age		of Service
William P. Hankowsky		56		7
George J. Alburger, Jr.		60		12+
Robert E. Fenza		50		23+
James J. Bowes		54		11+
Michael T. Hagan		50		18+

The options that so become exercisable upon retirement, along with any other options that were already exercisable on the date of retirement, may be exercised until the date that is 36 months after the date of retirement.

Payments Made Upon Death or Disability

In the event of the death or disability of a named executive officer, in addition to the benefits listed under the headings “Payments Made Upon Termination by Trust Not for Cause” above, all unvested options or restricted

26

shares owned by the named executive officers will vest immediately. In the case of options, the options will remain exercisable until the date that is 36 months after the date of termination of the named executive officer’s employment with the Trust due to his death or disability.

Payments Made Upon a Termination Following a Change of Control

The Trust has a Management Severance Plan to which each of the named executive officers is a party. Pursuant to these agreements, if an executive’s employment is terminated within two years following a change of control (other than termination by the Company for cause or by reason of death or disability) or if the executive terminates his employment in certain circumstances defined in the agreement which constitute “good reason”, in addition to the benefits listed under the heading “Payments Made Upon Termination by Trust Not for Cause”:

•  the named executive officer will receive:

•  a lump sum severance payment of 2.99 times the sum of the executive’s current annual base salary plus the largest annual performance bonus paid to him over the previous five years;

•  a lump sum amount representing a pro rata portion, through the date of termination, of unpaid performance bonus for the year in which the termination occurs, assuming achievement of the target level of the performance goals;

•  a lump sum amount equal to the Trust’s maximum contribution under the 401(k) plan for a period of three years, including the year in which termination occurs;

•  an amount equal to the excise tax charged to the named executive officer as a result of the receipt of any change-of-control payments; and

•  continuation of employee group benefits coverage for a period of three years after the date of termination.

•  all options and restricted shares held by the executive, as well as contributions previously made by the Trust to the individual’s account under the 401(k) plan, will automatically vest

The Management Severance Plan to which the named executive officers are parties has been filed as Exhibit 10.9 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2001. Under the Management Severance Plan, a change of control is deemed to occur on:

• the date of on which shareholders of the Trust (or the Board, if shareholder approval is not required) approve a plan to dissolve or liquidate the Trust;

• the date on which transactions contemplated by an agreement to sell or dispose of substantially all of the Trust’s assets are consummated, other than a transaction in which holders of the Trust’s shares just prior to the transaction will have at least 50% of the voting power of the acquiring entity’s voting securities just after the transaction (without regard to such holder’s ownership of the acquiring entity’s voting securities immediately before or contemporaneously with such transaction), which voting securities are to be held by such holders just after the transaction in substantially the same proportion among themselves as just prior to the transaction;

• the first date on which (1) transactions contemplated by an agreement to merge or consolidate the Trust with or into another entity (or to merge the other entity with or into the Trust) are consummated, other than a transaction in which holders of the Trust’s shares just prior to the transaction will have at least 50% of the voting power of the surviving entity’s voting securities just after the transaction (without regard to such holder’s ownership of the acquiring entity’s voting securities immediately before or contemporaneously with such transaction), which voting securities are to be held by such holders just after the transaction in substantially the same proportion among themselves as just prior to the transaction and (2) those who were board members just prior to the merger or consolidation cease to constitute a majority of the Board;

• the date on which any entity, person or group (excluding the Trust, any of its subsidiaries, or any employee benefit plan sponsored or maintained by the Trust or any of its subsidiaries) has become the beneficial owner of, or has obtained voting control over, more than 20% of the outstanding shares (without regard to any contractual or other restriction on the conversion or other exchange of securities into or for shares); or

27

• the first day after which a majority of the Board has been a member of the Board for less than two years, unless the nomination for election of each new trustee (who was not a trustee at the beginning of such two-year period) was approved by a vote of at least 2/3 of the trustees then in office who were trustees at the beginning of such period.

William P. Hankowsky

	Termination						Termination Within
	by Trust Not				Death or		Two Years Following
	For Cause		Retirement		Disability		a Change of Control
Cash Severance	$	666,696		—	$	666,696	$	3,104,305
Value of Accelerated Share-Based Awards		—		—		1,959,829		1,959,829
Excise Tax Gross-Up		—		—		—		1,522,141
Total	$	666,696		—	$	2,626,525	$	6,586,275

George J. Alburger, Jr.

	Termination						Termination Within
	by Trust Not				Death or		Two Years Following
	For Cause		Retirement		Disability		a Change of Control
Cash Severance	$	635,458		—	$	635,458	$	2,120,858
Value of Accelerated Share-Based Awards		—	$	1,100,427		1,157,989		1,157,989
Excise Tax Gross-Up		—		—		—		—
Total	$	635,458	$	1,100,427	$	1,793,447	$	3,278,847

Robert E. Fenza

	Termination						Termination Within
	by Trust Not				Death or		Two Years Following
	For Cause		Retirement		Disability		a Change of Control
Cash Severance	$	676,226		—	$	676,226	$	2,134,253
Value of Accelerated Share-Based Awards		—		—		428,318		428,318
Excise Tax Gross-Up		—		—		—		—
Total	$	676,226		—	$	1,104,544	$	2,562,571

James J. Bowes

	Termination						Termination Within
	by Trust Not				Death or		Two Years Following
	For Cause		Retirement		Disability		a Change of Control
Cash Severance	$	433,007		—	$	433,007	$	1,802,309
Value of Accelerated Share-Based Awards		—		—		319,272		319,272
Excise Tax Gross-Up		—		—		—		—
Total	$	433,007		—	$	752,279	$	2,121,581

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Michael T. Hagan

	Termination						Termination Within
	by Trust Not				Death or		Two Years Following
	For Cause		Retirement		Disability		a Change of Control
Cash Severance	$	523,167		—	$	523,167	$	1,775,908
Value of Accelerated Share-Based Awards		—		—		306,510		306,510
Excise Tax Gross-Up		—		—		—		—
Total	$	523,167		—	$	829,677	$	2,082,418

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Pursuant to Section 16(a) of the Exchange Act, the Trust’s executive officers and trustees, and persons beneficially owning more than 10% of the common shares, are required to file with the Securities and Exchange Commission reports of their initial ownership and changes in ownership of common shares. The Trust believes that during 2007, its executive officers and trustees who were required to file reports under Section 16(a) complied with such requirements in all material respects.

TRUSTEE COMPENSATION

The following table shows the compensation paid to the members of the Trust’s Board of Trustees for the year ended December 31, 2007.

	Fees
	Earned
	or Paid		Share		Option		All Other
Name	in Cash		Awards(1)(2)		Awards(1)(2)		Compensation		Total
Frederick F. Buchholz	$	48,000	$	34,500	$	22,365		—	$	104,865
Thomas C. DeLoach, Jr.	$	56,500	$	34,500	$	22,365		—	$	113,365
Daniel P. Garton	$	34,500	$	34,500	$	22,365		—	$	91,365
J. Anthony Hayden	$	42,000	$	34,500	$	22,365		—	$	98,865
M. Leanne Lachman	$	52,500	$	34,500	$	22,365		—	$	109,365
David L. Lingerfelt	$	32,000	$	34,500	$	22,365		—	$	88,865
Jose A. Mejia	$	43,500	$	34,500	$	17,428		—	$	95,428
John A. Miller	$	47,000	$	34,500	$	22,365		—	$	103,865
Stephen B. Siegel	$	39,000	$	34,500	$	22,365		—	$	95,865

(1)

The aggregate numbers of shares and shares issuable upon the exercise of options to purchase shares for the trustees outstanding as of December 31, 2007 are as follows: Mr. Buchholz (28,494 shares; options to purchase 40,000 shares); Mr. DeLoach (37,803 shares; options to purchase 17,500 shares); Mr. Garton (3,402 shares; options to purchase 30,000 shares); Mr. Hayden (77,768 shares; options to purchase 50,000 shares); Ms. Lachman (36,506 shares; options to purchase 35,000 shares); Mr. Lingerfelt (8,850 shares; options to purchase 50,000 shares); Mr. Mejia (1,405 shares; options to purchase 15,000 shares); Mr. Miller (19,948 shares; options to purchase 50,000 shares); and Mr. Siegel (31,813 shares; options to purchase 16,500 shares).

(2)

The grant date fair values of the shares awards and option awards made to each of the non-employee trustees in 2007 were $49.74 and $5.33, respectively.

The 2008 compensation policy for trustees who are not also officers and full-time employees of the Trust is the same as the policy that was in place in 2007. Under this policy, these trustees receive an annual trustee fee in the amount of $21,500 in cash, and restricted common shares having a grant date fair value of $34,500. Additionally, trustees receive a fee of $1,500 for each Board meeting that such trustee attends in person; however, trustees receive a fee of $500 for teleconference Board meetings if such meetings address only routine matters. Trustees also receive

29

a fee of $500 for participation in any informational call held to supplement the regularly scheduled Board meetings. Trustees will be entitled to receive a fee of $1,000 for each committee on which they serve, a fee of $1,000 for each committee meeting such trustee attends in person and a fee of $500 for each committee meeting attended by teleconference. The Chair of the Audit Committee receives an additional annual fee of $10,000. The Chairs of the Corporate Governance and Nominating Committee and the Compensation Committee each receive an additional annual fee of $6,000. Additionally, all trustees are entitled to be reimbursed for travel and lodging expenses associated with attending Board and committee meetings. Trustees who are officers and full-time employees of the Trust are not entitled to receive any separate compensation for service as a trustee or committee member.

Pursuant to the Trust’s Amended and Restated Share Incentive Plan, each non-employee trustee is entitled to receive an annual grant of a 10-year option to purchase 5,000 common shares, exercisable at a price equal to the fair market value of the common shares on June 23rd of each year. Such options vest over a three-year period beginning with the date of grant as follows: 20% after the first year; 50% after two years; and 100% after three years.

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RATIFICATION OF SELECTION OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Ernst & Young LLP has audited the Trust’s financial statements since the Trust’s inception. The Audit Committee of the Board of Trustees has selected Ernst & Young LLP as the Trust’s independent registered public accounting firm for the fiscal year ending December 31, 2008.

Representatives of Ernst & Young LLP are expected to be present at the Meeting. They will have an opportunity to make a statement if they desire to do so, and are expected to be available to respond to appropriate questions.

Fees billed to the Trust by Ernst & Young LLP during 2007 and 2006

Ernst & Young LLP was the Trust’s independent registered public accounting firm for the fiscal years ended December 31, 2007 and 2006. Certain prior year fee amounts have been adjusted to reflect billing adjustments made subsequent to issuance of the proxy statement for our 2007 annual meeting of shareholders.

Audit Fees.  Fees for audit services rendered by Ernst & Young LLP for the fiscal years ended December 31, 2007 and 2006 were $999,761 and $810,900, respectively. These services included (i) the audit of the Trust’s annual financial statements and internal control over financial reporting, (ii) the reviews of the financial statements included in the Trust’s Quarterly Reports on Form 10-Q for the quarters ended March 31, June 30, and September 30, and (iii) consents and comfort letters issued in connection with debt and equity offerings and registration statements.

Audit-Related Fees.  Fees for audit-related services that were reasonably related to the performance of the 2007 and 2006 audits or reviews of the Trust’s financial statements and are not reported under the preceding paragraph totaled $1,500 and $1,500, respectively. These fees were for accounting research software.

Tax Fees.  Fees billed to the Trust by Ernst & Young LLP during 2007 and 2006 for professional services rendered for tax compliance, tax advice and tax planning totaled $114,546 and $35,412, respectively.

All Other Fees.  There were no other fees billed to the Trust by Ernst & Young LLP during 2007 or 2006.

All audit, audit-related and tax services were pre-approved by the Audit Committee, which concluded that the provision of such services by Ernst & Young LLP was compatible with the maintenance of that firm’s independence in the conduct of its auditing functions. The Audit and Non-Audit Services Pre-Approval Policy provides for (a) general pre-approval of certain specified services and (b) specific pre-approval of all other permitted services, as well as proposed services exceeding pre-approved cost levels. The policy authorizes the Audit Committee to delegate to one or more of its members’ pre-approval authority with respect to permitted services.

For both types of pre-approval, the Audit Committee will consider whether such services are consistent with the Securities and Exchange Commission’s rules on auditor independence. The Audit Committee will also consider whether the independent registered public accounting firm is best positioned to provide the most effective and efficient service, for reasons such as its familiarity with the Company’s business, people, culture, accounting systems, risk profile and other factors, and whether the service might enhance the Company’s ability to manage or control risk or improve audit quality. All such factors will be considered as a whole, and no one factor is necessarily determinative.

Shareholder ratification of the selection of Ernst & Young LLP as the Trust’s independent registered public accounting firm is not required by the Trust’s Bylaws or any other applicable legal requirement. However, the Board of Trustees is submitting the selection of Ernst & Young LLP to the shareholders for ratification as a matter of good corporate practice. If the shareholders fail to ratify the selection, the Audit Committee and the Board of Trustees will reconsider whether or not to retain that firm. Even if the selection is ratified, the Board of Trustees at its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Trust and the shareholders.

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The Audit Committee has considered whether Ernst & Young LLP’s provision of services other than professional services rendered for the audit and review of the Trust’s annual financial statements is compatible with maintaining Ernst & Young LLP’s independence, and has determined that it is so compatible.

Recommendation and Required Vote

The Board of Trustees recommends a vote FOR ratification of Ernst & Young LLP as the Trust’s independent registered public accounting firm for the fiscal year ending December 31, 2008. Ratification requires the affirmative vote of the holders of a majority of the common shares represented at the Meeting.

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Alan Lingerfelt, the brother of David L. Lingerfelt, one of our trustees, was employed as a Senior Vice President of the Trust in our Richmond, Virginia office through his departure on June 30, 2007. During 2007, he was paid compensation of approximately $301,000 for such services. All share options and restricted shares included in his compensation for 2007 were forfeited when his employment terminated.

POLICY FOR APPROVING RELATED PARTY TRANSACTIONS

Our Codes of Conduct for Trustees and for Executive Officers mandate that officers and trustees bring promptly to the attention of our General Counsel any transaction or series of transactions that may result in a conflict of interest between that person and the Trust. Following any disclosure, our General Counsel will then review with the Chairman of our Audit Committee the relevant facts disclosed by the officer or trustee in question. After this review, the Chairman of the Audit Committee and the General Counsel determine whether the matter should be brought to the Audit Committee or the full Board of Trustees for approval. In considering any such transaction, the Audit Committee or the Board of Trustees, as the case may be, will consider various relevant factors, including, among others, the reasoning for the Trust to engage in the transaction, whether the terms of the transaction are arm’s length and the overall fairness of the transaction to the Company. If a member of the Audit Committee or the Board is involved in the transaction, he or she will not participate in any of the discussions or decisions about the transaction. The transaction must be approved in advance whenever practicable, and if not practicable, must be ratified as promptly as practicable.

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