EXHIBIT 99.1
KEYSTONE PROPERTY TRUST
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THIRD QUARTER 2001 EARNINGS CONFERENCE CALL
SUPPLEMENTAL INFORMATION PACKAGE
Page
---------
Financial Highlights 1
Condensed Consolidated Statements of Operations 2
Condensed Consolidated Statements of FFO and FAD 3
Condensed Consolidated Balance Sheets 4
Market Operating Statistics 5
Portfolio Overview 6
Third Quarter Same Store Analysis 7
Year-to-Date Same Store Analysis 8
Lease Expirations 9
Top 25 Tenants 10
Acquisitions, Dispositions, and Development Placed in Service in 2001 11
Equity Method Investments Pro-rata Consolidating Balance Sheet 12
Equity Method Investments-Pro-rata Consolidating Statements of Income and FFO 13
Summary of Land Under Development and Control 14
Debt Detail 15
COMPARATIVE HISTORICAL DATA:
Portfolio Analysis 16
Physical Occupancy Analysis 17
Preferred Equity Analysis 18
Equity Analysis 19
Debt Analysis 20
Valuation Analysis 21
Dividend Analysis 22
Research Coverage 23
THIS SUPPLEMENTAL INFORMATION PACKAGE MAY CONTAIN STATEMENTS WHICH CONSTITUTE
FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995, INCLUDING STATEMENTS REGARDING THE INTENT, BELIEF
OR CURRENT EXPECTATIONS OF THE COMPANY, ITS TRUSTEES, OR ITS OFFICERS WITH
RESPECT TO THE FUTURE OPERATING PERFORMANCE OF THE COMPANY. INVESTORS ARE
CAUTIONED THAT ANY SUCH FORWARD LOOKING STATEMENTS ARE NOT GUARANTEES OF FUTURE
PERFORMANCE AND INVOLVE RISKS AND UNCERTAINTIES, AND THAT ACTUAL RESULTS MAY
DIFFER MATERIALLY FROM THOSE IN THE FORWARD LOOKING STATEMENTS AS A RESULT OF
VARIOUS FACTORS. IMPORTANT FACTORS THAT COULD CAUSE SUCH DIFFERENCES ARE
DESCRIBED IN THE COMPANY'S PERIODIC FILINGS WITH THE SECURITIES AND EXCHANGE
COMMISSION, INCLUDING THE COMPANY'S FORM 10-K AND QUARTERLY REPORTS ON FORM
10-Q.
KEYSTONE PROPERTY TRUST
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FINANCIAL HIGHLIGHTS (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended September 30, Nine Months Ended September 30,
INCOME ITEMS: 2001 % Change 2000 2001 % Change 2000
------------ ----------- ------------ ------------- ---------- ---------------
Revenue $ 27,470 (14.1%) $ 31,986 $ 84,860 (6.5%) $ 90,771
Earnings Before Interest, Taxes, and Depreciation
(EBITDA) 21,090 (13.4%) 24,364 64,497 (7.1%) 69,424
Net Income Allocated to Common Shares 10,391 n/a (4,306) 11,981 n/a (700)
Funds from Operations 13,489 12.7% 11,964 37,445 6.9% 35,035
Funds from Operations - Per Share-(Diluted) 0.44 (6.4%) 0.47 1.31 (5.1%) 1.38
Dividends Paid Per Share- Common Shares 0.32 3.2% 0.31 0.94 4.4% 0.90
Diluted Earnings (Loss) Per Share 0.55 n/a (0.46) 0.83 n/a (0.08)
Weighted Average Common Shares and Units- FFO 30,997,250 20.5% 25,724,558 28,683,229 12.8% 25,419,506
Weighted Average Common Shares and Units- EPS 24,363,191 43.3% 17,003,664 20,282,848 20.3% 16,864,468
RATIOS:
Interest Coverage Ratio 2.6x 1.9 2.3x 2.0x
Fixed Charge Coverage Ratio 1.9x 1.5 1.7x 1.6x
Dividend Payout Ratio-FFO 72.7% 66.0% 71.8% 65.2%
As of
As of September 30, December 31,
----------------------------- ------------
2001 2000 2000
-------- -------- ------------
ASSETS:
Investments in Real Estate at Cost $817,223 $971,981 $957,598
-------- -------- --------
Total Assets 838,782 978,698 962,687
-------- -------- --------
LIABILITIES AND EQUITY:
Total Debt $441,405 $633,652 $616,569
Other Liabilities 20,480 18,446 22,184
Convertible Preferred Equity, at Liquidation
Preference 100,392 140,392 140,392
Common Equity and Minority Interest 276,505 185,773 183,542
-------- -------- --------
Total Liabilities and Equity 838,782 978,263 962,687
-------- -------- --------
RATIOS:
Debt to Undepreciated Assets 49.6% 62.4% 61.5%
Total Liabilities to Undepreciated Assets 51.9% 64.2% 63.7%
Page 1 of 23
KEYSTONE PROPERTY TRUST
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended Nine Months Ended
September 30, September 30,
2001 2000 2001 2000
-------- -------- -------- --------
REVENUE:
Rents $ 24,112 $ 28,299 $ 73,646 $ 80,041
Reimbursement Revenue and Other 3,358 3,687 11,214 10,730
-------- -------- -------- --------
Total Revenue 27,470 31,986 84,860 90,771
-------- -------- -------- --------
OPERATING EXPENSES:
Property Operating Expenses $ 2,100 $ 2,755 $ 6,774 $ 7,952
Real Estate Taxes 2,398 2,811 7,492 7,771
General and Administrative 2,268 1,808 6,552 6,040
Depreciation and Amortization 5,567 4,887 19,398 15,455
Interest Expense 7,894 12,442 27,697 34,516
Provision for Asset Revaluation -- 11,300 -- 11,300
-------- -------- -------- --------
Total Operating Expense 20,227 36,003 67,913 83,034
-------- -------- -------- --------
Income (Loss) before Equity in Income from Equity Method 7,243 (4,017) 16,947 7,737
Investments, and Gains on Sales of Assets
Equity in Income from Equity Method Investments 386 (248) 455 416
Gains on Sales of Assets 10,025 (252) 10,361 372
-------- -------- -------- --------
Income (Loss) before Distributions to Preferred
Unitholders, Minority Interest of Unitholders
in Operating Partnership, Extraordinary items,
and Income Allocated to Preferred Shareholders 17,654 (4,517) 27,763 8,525
Distributions to Preferred Unitholders (1,747) (1,924) (5,610) (4,943)
-------- -------- -------- --------
Income (Loss) before Minority Interest of Unitholders
in Operating Partnership, Extraordinary items, and
Income Allocated to Preferred Shareholders 15,907 (6,441) 22,153 3,582
Minority Interest of Unitholders in Operating Partnership (4,180) 3,542 (4,806) 664
Extraordinary Items-Losses on Early Retirement of Debt (94) -- (1,269) --
-------- -------- -------- --------
Income (Loss) before Income Allocated to Preferred
Shareholders 11,633 (2,899) 16,078 4,246
Income Allocated to Preferred Shareholders (1,242) (1,407) (4,097) (4,946)
-------- -------- -------- --------
Net Income (Loss) Allocated to Common Shareholders $ 10,391 $ (4,306) $ 11,981 $ (700)
======== ======== ======== ========
Page 2 of 23
KEYSTONE PROPERTY TRUST
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CONDENSED CONSOLIDATED STATEMENTS OF FFO AND FAD (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended September 30, Nine Months Ended September 30,
2001 2000 2001 2000
------------ ------------ ------------ ------------
FUNDS FROM OPERATIONS:
Income before Minority Interest of Unitholders in Operating $ 17,654 $ (4,517) $ 27,763 $ 8,525
Partnership, Extraordinary Items, and Income Allocated
to Preferred Shareholders
Provision for Asset Valuation -- 11,300 -- 11,300
Gains on Sales of Assets (10,025) 252 (10,361) (372)
Depreciation and Amortization Related to Real Estate 5,567 4,887 19,398 15,455
Depreciation and Amortization Related to Joint Ventures 293 42 645 127
and Equity Method Investments
------------ ------------ ------------ ------------
Funds from Operations $ 13,489 $ 11,964 $ 37,445 $ 35,035
============ ============ ============ ============
Funds from Operations-Basic $ 0.45 $ 0.51 $ 1.35 $ 1.49
============ ============ ============ ============
Funds from Operations-per Diluted Share $ 0.44 $ 0.47 $ 1.31 $ 1.38
============ ============ ============ ============
FUNDS AVAILABLE FOR DISTRIBUTION:
Funds from Operations $ 13,489 $ 11,964 $ 37,445 $ 35,035
Building Improvements (246) (227) (796) (661)
Tenant Improvements (588) (1,056) (1,609) (2,102)
Leasing Commissions (264) (1,256) (1,511) (2,866)
Amortization of Deferred Financing Costs 452 485 1,384 1,364
Amortization of Restricted Stock Awards -- 68 -- 204
Rental Income from Straight Line Rents (660) (1,027) (2,095) (2,846)
------------ ------------ ------------ ------------
Funds Available for Distribution $ 12,183 $ 8,951 $ 32,818 $ 28,128
============ ============ ============ ============
Funds Available for Distribution-per Diluted Share $ 0.39 $ 0.35 $ 1.14 $ 1.11
============ ============ ============ ============
Weighted Average Shares and Units - Diluted 30,997,250 25,724,558 28,683,229 25,419,506
============ ============ ============ ============
Dividend Paid per Common Share $ 0.32 $ 0.31 $ 0.94 $ 0.90
============ ============ ============ ============
Dividend Payout Ratio-FFO 72.7% 66.0% 71.8% 65.2%
Dividend Payout Ratio-FAD 82.1% 88.6% 82.5% 81.1%
Page 3 of 23
KEYSTONE PROPERTY TRUST
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CONDENSED CONSOLIDATED BALANCE SHEETS (DOLLARS IN THOUSANDS)
September 30, 2001 December 31, 2000
------------------ -----------------
ASSETS:
Investments in Real Estate, Including Development and Construction
in Progress of $53,982 and $28,366 for 2001 and 2000, respectively $ 817,223 $ 957,598
Less: Accumulated Depreciation (50,471) (40,558)
--------- ---------
Investments in Real Estate, Net 766,752 917,040
--------- ---------
Cash, Cash Equivalents, and Escrows 17,798 10,265
Accounts Receivable, Net 10,728 9,446
Deferred Financing and Leasing Costs, Net 9,737 13,201
Equity Method Investments 23,615 6,686
Other Assets 10,152 6,049
--------- ---------
Total Assets $ 838,782 $ 962,687
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Liabilities:
Mortgage Notes and Other Debt $ 441,405 $ 616,569
Accrued Liabilities and Other 20,480 22,184
--------- ---------
Total Liabilities 461,885 638,753
--------- ---------
Minority Interest:
Limited Partners in OP 49,909 76,710
Convertible Preferred Units 60,392 80,295
--------- ---------
Total Minority Interest 110,301 157,005
--------- ---------
Shareholders' Equity:
Preferred Stock, $.001 par value 2 3
Common Stock, $.001 par value 18 9
Additional Paid-in Capital 276,606 178,034
Cumulative Net Income 33,497 21,516
Cumulative Dividends (43,527) (32,633)
--------- ---------
Total Shareholders' Equity 266,596 166,929
--------- ---------
Total Liabilities and Shareholders' Equity $ 838,782 $ 962,687
========= =========
Page 4 of 23
KEYSTONE PROPERTY TRUST
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MARKET OPERATING STATISTICS (AS OF SEPTEMBER 30, 2001)
Total Core
New Jersey Pennsylvania Indiana Industrial
----------------- ----------------- ----------------- ---------------
Square Feet Owned at September 30, 2001 6,157,225 5,096,245 2,194,848 13,448,318
Economic Occupancy - Year-to-date 99.2% 95.9% 100.0% 98.3%
Physical Occupancy at September 30, 2001 99.3% 96.5% 100.0% 98.4%
Annualized Base Rent (in 000's) $ 28,727 $ 17,965 $ 8,531 $ 55,223
Annualized Base Rent Per Leased SF $ 4.70 $ 3.65 $ 3.89 $ 4.17
Lease Expirations as a Percentage of ABR:
2001 0.0% 2.5% 0.0% 0.8%
2002 1.7% 30.9% 0.0% 11.0%
2003 9.8% 13.1% 10.5% 11.0%
Wtd Avg Lease Term Remaining (in years) 4.9 3.4 10.4 5.3
Square Feet of Leasing Activity in Quarter 735,181 33,600 -- 768,781
Year-to-date 1,169,856 394,467 1,397,248 2,961,571
Tenant Retention during period 94.4% N/A N/A 100.0%
Year-to-date 76.6% 56.9% 100.0% 80.0%
Rent Change on Renewals and Rollovers during period: 25.9% 18.2% N/A 25.6%
Year-to-date 21.6% 8.8% 0.0% 14.9%
Same Store NOI Growth during period (cash basis): 6.4% (4.9%) 0.3% 1.1%
Year-to-date 9.9% (2.1%) 0.2% 3.6%
Square Feet Owned in Same Store Pool 4,800,431 4,313,736 1,396,752 10,510,919
Other TOTAL GRAND
Industrial INDUSTRIAL Office TOTAL
----------------- ----------------- ----------------- ---------------
Square Feet Owned at September 30, 2001 5,890,286 19,338,604 2,138,739 21,477,343
Economic Occupancy - Year-to-date 85.8% 95.0% 95.5% 95.1%
Physical Occupancy at September 30, 2001 83.3% 93.8% 96.1% 94.0%
Annualized Base Rent (in 000's) $ 15,719 $ 70,942 $ 29,735 $ 100,677
Annualized Base Rent Per Leased SF $ 3.20 $ 3.91 $ 14.47 $ 4.99
Lease Expirations as a Percentage of ABR:
2001 3.5% 1.4% 6.1% 2.8%
2002 35.4% 16.4% 7.9% 13.9%
2003 19.4% 12.8% 22.7% 15.8%
Wtd Avg Lease Term Remaining (in years) 3.4 4.9 3.6 4.5
Square Feet of Leasing Activity in Quarter 855,448 1,624,229 26,650 1,650,879
Year-to-date 1,283,342 4,244,913 76,015 4,320,928
Tenant Retention during period 84.9% 89.9% 42.6% 89.5%
Year-to-date 49.4% 67.0% 72.6% 67.1%
Rent Change on Renewals and Rollovers during period: 1.7% 14.5% (3.3%) 13.1%
Year-to-date 0.5% 10.1% 3.7% 9.6%
Same Store NOI Growth during period (cash basis): (13.5%) (3.0%) (3.3%) (3.1%)
Year-to-date (10.7%) (0.8%) (2.9%) (1.5%)
Square Feet Owned in Same Store Pool 5,890,286 16,401,205 2,024,739 18,425,944
Page 5 of 23
KEYSTONE PROPERTY TRUST
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PORTFOLIO OVERVIEW (DOLLARS IN THOUSANDS, AS OF SEPTEMBER 30, 2001)
TOTAL CORE
New Jersey Pennsylvania Indiana INDUSTRIAL
--------------- ---------------- -------------- -----------------
Number of Buildings 20 19 6 45
Square Feet Owned at September 30, 2001 6,157,225 5,096,245 2,194,848 13,448,318
% of Total Rentable SF 28.7% 23.7% 10.2% 62.6%
Percentage Leased 99.3% 96.5% 100.0% 98.4%
Annualized Base Rent $ 28,727 $ 17,965 $ 8,531 $ 55,223
% of Total Annualized Base Rent 28.5% 17.8% 8.5% 54.9%
Number of Leases 30 31 7 68
Base Rent Per Leased SF $ 4.70 $ 3.65 $ 3.89 $ 4.17
Other TOTAL
Industrial INDUSTRIAL Office GRAND TOTAL
----------------- ---------------- -------------- -------------
Number of Buildings 50 95 32 127
Square Feet Owned at September 30, 2001 5,890,286 19,338,604 2,138,739 21,477,343
% of Total Rentable SF 27.4% 90.0% 10.0% 100.0%
Percentage Leased 83.3% 93.8% 96.1% 94.0%
Annualized Base Rent $ 15,719 $ 70,942 $ 29,735 $ 100,677
% of Total Annualized Base Rent 15.6% 70.5% 29.5% 100.0%
Number of Leases 56 124 162 286
Base Rent Per Leased SF $ 3.20 $ 3.91 $ 14.47 $ 4.99
Page 6 of 23
KEYSTONE PROPERTY TRUST
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QUARTERLY SAME STORE ANALYSIS (DOLLARS IN THOUSANDS)
CORE SAME STORE PORTFOLIO NON-CORE SAME STORE PORTFOLIO
Three Months Ended September 30, Three Months Ended September 30,
----------------------------------------------- ----------------------------------------------
2001 2000 Change % Change 2001 2000 Change % Change
----------------------------------------------- ----------------------------------------------
REVENUE
Gross Potential Rent $ 10,696 $ 10,221 $ 475 4.6% $ 12,225 $ 12,256 $ (31) (0.3%)
Vacancy Loss (235) (11) (224) 2036.4% (1,163) (634) (529) 83.4%
----------------------------------------------- ----------------------------------------------
Rental Revenue 10,461 10,210 251 2.5% 11,062 11,622 (560) (4.8%)
OPERATING EXPENSES
Property Operating Expenses 321 268 53 19.8% 1,837 1,816 21 1.2%
Real Estate Taxes 1,152 1,087 65 6.0% 1,290 1,270 20 1.6%
Tenant Reimbursement (1,358) (1,380) 22 (1.6%) (1,480) (1,626) 146 (9.0%)
----------------------------------------------- ----------------------------------------------
Net Operating Expenses 115 (25) 140 (560.0%) 1,647 1,460 187 12.8%
----------------------------------------------- ----------------------------------------------
NET OPERATING INCOME $ 10,346 $ 10,235 $ 111 1.1% $ 9,415 $ 10,162 $ (747) (7.4%)
=============================================== ==============================================
PHYSICAL OCCUPANCY (EOP) 97.5% 99.7% (2.2%) 85.2% 95.0% (9.8%)
ECONOMIC OCCUPANCY 97.8% 99.9% (2.1%) 90.5% 94.8% (4.3%)
PERCENTAGE OF TOTAL NOI: 45.0% 41.0%
COMPONENTS OF NOI CHANGES:
Rental Increases/(Decreases) $ 475 4.6% $ (31) (0.3%)
Occupancy Increases/(Decreases) (224) (2.1%) (529) (5.3%)
Reduction/(Increase) in expenses,
net of reimbursements (140) (1.4%) (187) (1.8%)
----------------------- ---------------------
Total $ 111 1.1% $ (747) (7.4%)
======================= =====================
TOTAL SAME STORE PORTFOLIO
Three Months Ended September 30,
---------------------------------------------------------
2001 2000 Change % Change
---------------------------------------------------------
REVENUE
Gross Potential Rent $ 22,921 $ 22,477 $ 444 2.0%
Vacancy Loss (1,398) (645) (753) 116.7%
---------------------------------------------------------
Rental Revenue 21,523 21,832 (309) (1.4%)
OPERATING EXPENSES
Property Operating Expenses 2,158 2,084 74 3.6%
Real Estate Taxes 2,442 2,357 85 3.6%
Tenant Reimbursement (2,838) (3,006) 168 (5.6%)
---------------------------------------------------------
Net Operating Expenses 1,762 1,435 327 22.8%
---------------------------------------------------------
NET OPERATING INCOME $ 19,761 $ 20,397 $ (636) (3.1%)
=========================================================
PHYSICAL OCCUPANCY (EOP) 91.7% 97.5% (5.8%)
ECONOMIC OCCUPANCY 93.9% 97.1% (3.2%)
PERCENTAGE OF TOTAL NOI: 86.0%
COMPONENTS OF NOI CHANGES:
Rental Increases/(Decreases) $ 444 2.2%
Occupancy Increases/(Decreases) (753) (3.7%)
Reduction/(Increase) in expenses,
net of reimbursements (327) (1.6%)
-----------------------------
Total $ (636) (3.1%)
=============================
Page 7 of 23
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YEAR TO DATE SAME STORE ANALYSIS (DOLLARS IN THOUSANDS)
CORE SAME STORE PORTFOLIO NON-CORE SAME STORE PORTFOLIO
Nine Months Ended September 30, Nine Months Ended September 30,
----------------------------------------------- ----------------------------------------------
2001 2000 Change % Change 2001 2000 Change % Change
----------------------------------------------- ----------------------------------------------
REVENUE
Gross Potential Rent $ 30,030 $ 28,516 $ 1,514 5.3% $ 36,863 $ 36,690 $ 173 0.5%
Vacancy Loss (572) (158) (414) 262.0% (3,102) (1,565) (1,537) 98.2%
----------------------------------------------- ----------------------------------------------
Rental Revenue 29,458 28,358 1,100 3.9% 33,761 35,125 (1,364) (3.9%)
OPERATING EXPENSES
Property Operating Expenses 1,012 911 101 11.1% 5,700 5,341 359 6.7%
Real Estate Taxes 2,968 2,925 43 1.5% 3,826 3,671 155 4.2%
Tenant Reimbursement (3,857) (3,800) (57) 1.5% (4,986) (4,994) 8 (0.2%)
----------------------------------------------- ----------------------------------------------
Net Operating Expenses 123 36 87 241.7% 4,540 4,018 522 13.0%
----------------------------------------------- ----------------------------------------------
NET OPERATING INCOME $ 29,335 $ 28,322 $ 1,013 3.6% $ 29,221 $ 31,107 $ (1,886) (6.1%)
=============================================== ==============================================
PHYSICAL OCCUPANCY (EOP) 97.5% 99.7% (2.2%) 85.2% 95.0% (9.8%)
ECONOMIC OCCUPANCY 98.1% 99.4% (1.3%) 91.6% 95.7% (4.1%)
PERCENTAGE OF TOTAL NOI: 41.6% 41.4%
COMPONENTS OF NOI CHANGES:
Rental Increases/(Decreases) $ 1,514 5.3% $ 173 0.6%
Occupancy Increases/(Decreases) (414) (1.4%) (1,537) (5.0%)
Reduction/(Increase) in expenses,
net of reimbursements (87) (0.3%) (522) (1.7%)
--------------------- --------------------
Total $ 1,013 3.6% $ (1,886) (6.1%)
===================== ====================
TOTAL SAME STORE PORTFOLIO
Nine Months Ended September 30,
------------------------------------------------
2001 2000 Change % Change
------------------------------------------------
REVENUE
Gross Potential Rent $ 66,893 $ 65,206 $ 1,687 2.6%
Vacancy Loss (3,674) (1,723) (1,951) 113.2%
------------------------------------------------
Rental Revenue 63,219 63,483 (264) (0.4%)
OPERATING EXPENSES
Property Operating Expenses 6,712 6,252 460 7.4%
Real Estate Taxes 6,794 6,596 198 3.0%
Tenant Reimbursement (8,843) (8,794) (49) 0.6%
------------------------------------------------
Net Operating Expenses 4,663 4,054 609 15.0%
------------------------------------------------
NET OPERATING INCOME $ 58,556 $ 59,429 $ (873) (1.5%)
================================================
PHYSICAL OCCUPANCY (EOP) 91.7% 97.5% (5.8%)
ECONOMIC OCCUPANCY 94.5% 97.4% (2.9%)
PERCENTAGE OF TOTAL NOI: 82.9%
COMPONENTS OF NOI CHANGES:
Rental Increases/(Decreases) $ 1,687 2.8%
Occupancy Increases/(Decreases) (1,951) (3.3%)
Reduction/(Increase) in expenses,
net of reimbursements (609) (1.0%)
----------------------
Total $ (873) (1.5%)
======================
Page 8 of 23
KEYSTONE PROPERTY TRUST
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LEASE EXPIRATIONS (DOLLARS IN THOUSANDS, AS OF SEPTEMBER 30, 2001)
INDUSTRIAL VS OFFICE LEASE EXPIRATIONS
INDUSTRIAL PROPERTIES OFFICE PROPERTIES TOTAL
--------------------------------- --------------------------------- ---------------------------------
Square Annualized Square Annualized Square Annualized
Feet Base Rent % ABR Feet Base Rent % ABR Feet Base Rent % ABR
---------- ---------- ------- ---------- ---------- ------- ---------- ---------- -------
2001 356,353 $ 1,005 1.4% 111,909 $ 1,827 6.1% 468,262 $ 2,832 2.8%
2002 3,546,895 11,621 16.4% 171,413 2,339 7.9% 3,718,308 13,960 13.9%
2003 2,291,533 9,101 12.8% 435,662 6,761 22.7% 2,727,195 15,862 15.8%
2004 2,296,466 9,682 13.6% 313,522 3,676 12.4% 2,609,988 13,358 13.3%
2005 1,229,370 5,598 7.9% 432,786 6,286 21.1% 1,662,156 11,884 11.8%
2006 2,030,316 7,796 11.0% 287,847 3,836 12.9% 2,318,163 11,632 11.6%
2007 1,186,890 5,376 7.6% 29,971 466 1.6% 1,216,861 5,842 5.8%
2008 1,367,993 5,533 7.8% 130,259 1,931 6.5% 1,498,252 7,464 7.4%
2009 1,155,595 4,676 6.6% 1,896 28 0.1% 1,157,491 4,704 4.7%
2010 237,851 1,070 1.5% 23,633 449 1.5% 261,484 1,519 1.5%
2011 and beyond 2,435,034 9,484 13.4% 116,337 2,137 7.2% 2,551,371 11,621 11.5%
---------- ---------- ------- ---------- ---------- ------- ---------- ---------- -------
Total 18,134,296 $ 70,942 100.0% 2,055,235 $ 29,735 100.0% 20,189,531 $ 100,677 100.0%
========== ========== ======= ========== ========== ======= ========== ========== =======
CORE VS NON-CORE LEASE EXPIRATIONS
CORE PROPERTIES NON-CORE PROPERTIES TOTAL
--------------------------------- --------------------------------- ---------------------------------
Square Annualized Square Annualized Square Annualized
Feet Base Rent % ABR Feet Base Rent % ABR Feet Base Rent % ABR
---------- ---------- ------- ---------- ---------- ------- ---------- ---------- -------
2001 106,459 $ 454 0.8% 361,803 $ 2,378 5.2% 468,262 $ 2,831 2.8%
2002 1,653,797 6,063 11.0% 2,064,511 7,897 17.4% 3,718,308 13,960 13.9%
2003 1,462,047 6,059 11.0% 1,265,148 9,804 21.6% 2,727,195 15,863 15.8%
2004 1,965,811 8,421 15.2% 644,177 4,936 10.9% 2,609,988 13,357 13.3%
2005 941,870 4,891 8.9% 720,286 6,993 15.4% 1,662,156 11,883 11.8%
2006 1,721,066 7,000 12.7% 597,097 4,632 10.2% 2,318,163 11,632 11.6%
2007 1,092,942 4,458 8.1% 123,919 1,383 3.0% 1,216,861 5,841 5.8%
2008 1,252,858 4,942 8.9% 245,394 2,522 5.5% 1,498,252 7,464 7.4%
2009 881,923 3,881 7.0% 275,568 824 1.8% 1,157,491 4,705 4.7%
2010 237,851 1,070 1.9% 23,633 449 1.0% 261,484 1,520 1.5%
2011 and beyond 1,911,267 7,986 14.5% 640,104 3,635 8.0% 2,551,371 11,621 11.5%
---------- ---------- ------- ---------- ---------- ------- ---------- ---------- -------
Total 13,227,891 $ 55,223 100.0% 6,961,640 $ 45,454 100.0% 20,189,531 $ 100,677 100.0%
========== ========== ======= ========== ========== ======= ========== ========== =======
Page 9 of 23
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TOP 25 TENANTS (DOLLARS IN THOUSANDS, AS OF SEPTEMBER 30, 2001)
Term Remaining Number of Rentable Percentage Annualized Annualized
Tenant Name (in months) Leases Square Feet Leased Feet Base Rent Base Rent
----------------------------------------------------- --------------- --------- ----------- ----------- ---------- ----------
Brightpoint, Inc. 54-219 3 658,348 3.1% $ 3,414 3.4%
The Home Depot, Inc. (1) 28 1 812,739 3.8% 3,251 3.2%
Exel Logistics, Inc. 1-51 4 855,368 4.0% 2,733 2.7%
Franklin Storage, Inc. 13-19 2 690,400 3.2% 2,715 2.7%
Reckitt Benckiser 27 1 155,700 0.7% 2,618 2.6%
APL Logistics, Inc. (Formerly GATX Logistics, Inc.) 52 1 585,510 2.7% 2,576 2.6%
Xxxxxx Distribution 17 1 610,949 2.8% 2,291 2.3%
Belkin Electronics, Inc. (2) 114 1 798,096 3.7% 2,291 2.3%
Cosmetic Essence, Inc. 87 1 483,507 2.3% 1,987 2.0%
Coca-Cola Bottlers of New Jersey (1) 40 1 243,751 1.1% 1,950 1.9%
International Paper, Inc. 15-68 2 461,707 2.1% 1,924 1.9%
Poly-Foam International, Inc. 86-151 6 669,871 3.1% 1,861 1.8%
Cumberland Distribution 12 3 489,213 2.3% 1,660 1.6%
Hartford Fire Insurance 76 1 107,794 0.5% 1,613 1.6%
Engine Controls Distribution/Xxxx 89 1 407,100 1.9% 1,567 1.6%
BMG Music 14-22 2 445,591 2.1% 1,551 1.5%
Group Athletica (a division of Reebok) 80 1 599,152 2.8% 1,528 1.5%
SETCO, Inc. 60-64 2 327,636 1.5% 1,452 1.4%
AT & T Communications 51 1 86,602 0.4% 1,451 1.4%
Staples, Inc. 32 1 351,000 1.6% 1,422 1.4%
Direct Fulfillment LP 99 1 265,000 1.2% 1,365 1.4%
Royal Indemnity Co. 28-58 2 80,000 0.4% 1,328 1.3%
Parcel Direct (1) 63 1 241,110 1.1% 1,326 1.3%
Vestcom, Inc. 152 1 210,530 1.0% 1,324 1.3%
BMW 7 3 431,198 2.0% 1,236 1.2%
---------- ---------- ---------- ------ ---------- ------
Total/Wtd Avg 63 44 11,067,872 51.5% $ 48,434 48.1%
========== ========== ========== ====== ========== ======
----------
(1) Tenant occupies a property that is 20% owned as part of a Joint Venture
with CalEast Industrial Investors LLC.
(2) Tenant occupies a property that is 50% owned as part of a Joint Venture
with Xxxxxxxx Investments.
Page 10 of 23
KEYSTONE PROPERTY TRUST
------------------------------------------------------------------------------------------------------------------------------------
ACQUISITIONS, DISPOSITIONS, AND DEVELOPMENT PLACED IN SERVICE IN 2001 (DOLLARS IN THOUSANDS, AS OF SEPTEMBER 30, 2001)
Property City State Market Closing Date Square Feet
------------------------------------- --------------- -------- ---------------------------- ------------ ---------------
DEVELOPMENT
558 Airtech Park (1) Indianapolis IN Indianapolis 4/1/2001 798,096
----------------
DEVELOPMENT PLACED IN SERVICE TOTAL 798,096
ACQUISITIONS
INDUSTRIAL
000 Xxxxx Xxxxxx Xxxx Xxxxxxxxxxxxx XX Harrisburg/Chambersburg 1/5/2001 504,321
00 Xxxxxxxx Xxxx Xxxxx Xxxxxxxxxxxxx XX Harrisburg/Chambersburg 2/8/2001 132,548
000 Xxxxxxxx Xxxx Xxxx Xxxx XX Harrisburg/Chambersburg 3/23/2001 000,000
00 Xxxxxxx Xxxx (2) Cranbury NJ Central & Northern NJ 4/3/2001 812,739
Goldstar Land Parcel South Brunswick NJ Central & Northern NJ 9/28/2001 --
----------------
ACQUISITIONS TOTAL 1,595,248
DISPOSITIONS
INDUSTRIAL
000 Xxxxxxxx Xxxxx Xxxxxxxxxxxxx XX Harrisburg/Chambersburg 3/22/2001 597,100
000 Xxxxxxxxx Xxxxx (3) Carlstadt NJ Central & Northern NJ 3/21/2001 243,751
200-250 Xxxxxxx Drive (3) Sayreville NJ Central & Northern NJ 3/21/2001 164,267
300-000 Xxxxxxx Xxxxx (3) Sayreville NJ Central & Northern NJ 3/21/2001 161,987
309 Xxxxxxx Drive (3) Sayreville NJ Central & Northern NJ 3/21/2001 202,000
000 Xxxxxxx Xxxxx (3) Sayreville NJ Central & Northern NJ 3/21/2001 225,831
One Xxxxx Xxxx (3) Edison NJ Central & Northern NJ 3/21/2001 192,829
100-400 Xxxxx Xxxx (3) Edison NJ Central & Northern NJ 3/21/2001 851,907
000 Xxxxxxxxxx Xxxxxx Xxxxxxxxx XX Central & Northern NJ 9/27/2001 332,352
00 Xxxxxxx Xxxx Xxxxxxxxx XX Xxxxxxx & Northern NJ 9/27/2001 39,785
----------------
INDUSTRIAL TOTAL 3,011,809
OFFICE
0000 Xxxx Xxxx Xxxxxxxxx XX Xxxxxxxxx 1/26/2001 143,870
0000 Xxxxxxxxxx Xxxx Xxxxxxxxx XX Xxxxxxxxx 1/26/2001 80,000
0000 Xxxxxx Xxxxx Xxxxxxxxxxxxx XX Harrisburg/Chambersburg 1/26/2001 67,463
0000 Xxxx Xxxx Xxxxxxxxxx XX Reading 1/26/2001 52,841
----------------
OFFICE TOTAL 344,174
----------------
DISPOSITIONS TOTAL 3,355,983
=================
KEYSTONE PROPERTY TRUST
------------------------------------------------------------------------------------------------------------------------------------
ACQUISITIONS, DISPOSITIONS, AND DEVELOPMENT PLACED IN SERVICE IN 2001 (DOLLARS IN THOUSANDS, AS OF SEPTEMBER 30, 2001)
Property Current Leased % Purchase/Sales Price
------------------------------------- ---------------- -------------------
DEVELOPMENT
558 Airtech Park (1) 100.0% $ 18,500
-------------------
DEVELOPMENT PLACED IN SERVICE TOTAL $ 18,500
ACQUISITIONS
INDUSTRIAL
000 Xxxxx Xxxxxx Xxxx 100.0% $ 12,125
00 Xxxxxxxx Xxxx Xxxxx 100.0% 4,200
000 Xxxxxxxx Xxxx 100.0% 3,475
66 Station Road (2) 100.0% 32,300
Goldstar Land Parcel -- 6,422
-------------------
ACQUISITIONS TOTAL $ 58,522
DISPOSITIONS
INDUSTRIAL
000 Xxxxxxxx Xxxxx $ 27,000
000 Xxxxxxxxx Xxxxx (3) 18,800 (4)
200-250 Xxxxxxx Drive (3) 7,275 (4)
300-350 Xxxxxxx Drive (3) 7,025 (4)
309 Xxxxxxx Drive (3) 9,700 (4)
409 Xxxxxxx Drive (3) 10,575 (4)
One Xxxxx Xxxx (3) 8,325 (4)
100-400 Xxxxx Xxxx (3) 42,100 (4)
000 Xxxxxxxxxx Xxxxxx 38,700
00 Xxxxxxx Xxxx 2,900
-------------------
INDUSTRIAL TOTAL $ 172,400
OFFICE
0000 Xxxx Xxxx $ 15,000 (4)
0000 Xxxxxxxxxx Xxxx 9,750 (4)
0000 Xxxxxx Xxxxx 6,000 (4)
0000 Xxxx Xxxx 5,000 (4)
-------------------
OFFICE TOTAL $ 35,750
-------------------
DISPOSITIONS TOTAL $ 208,150
===================
----------
(1) This property was placed in service on April 1, 2001 and is 50% owned as
part of a joint venture with Xxxxxxxx Investments.
(2) This property was acquired by a joint venture with CalEast Industrial
Investors LLC, in which the Company has a 20% ownership interest.
(3) These properties were contributed/sold to a Joint Venture with CalEast
Industrial Investors LLC, in which the Company retained a 20% ownership
interest.
(4) These properties were sold as part of a portfolio sale.
Page 11 of 23
KEYSTONE PROPERTY TRUST
----------------------------------------------------------------------------------------------------------------------------------
EQUITY METHOD INVESTMENTS - PRO-RATA CONSOLIDATING BALANCE SHEET AT SEPTEMBER 30, 2001 (DOLLARS IN THOUSANDS)
Pro rata Pro rata
Keystone NJ Pro rata Keystone
KTR Associates, Airtech Realty Other
Historical LLC(1) Park (2) Services, Inc (3) Adjustments (4) Proforma Total
------------- ------------ ----------- ----------------- --------------- --------------
ASSETS
Gross Real Estate Assets $ 817,223 $ 27,527 $ 11,599 $ -- $ -- $ 856,349
Accumulated Depreciation (50,471) (340) (132) -- -- (50,943)
Other Assets 72,030 432 3,485 6,960 (21,585) 61,322
--------- --------- --------- --------- --------- ---------
Total Assets 838,782 27,619 14,952 6,960 (21,585) 866,728
========= ========= ========= ========= ========= =========
LIABILITIES & EQUITY
Debt 441,405 15,402 10,884 -- -- 467,691
Other Liabilities 20,480 391 23 1,246 -- 22,140
--------- --------- --------- --------- --------- ---------
Total Liabilities 461,885 15,793 10,907 1,246 -- 489,831
========= ========= ========= ========= ========= =========
Equity, Including Minority Interest 376,897 11,826 4,045 5,714 (21,585) 376,897
--------- --------- --------- --------- --------- ---------
Total Liabilities and Equity $ 838,782 $ 27,619 $ 14,952 $ 6,960 $ (21,585) $ 866,728
========= ========= ========= ========= ========= =========
(1) On March 21, 2001, Keystone Property Trust ( the "Company") formed a joint
venture known as Keystone New Jersey Associates, LLC with CalEast Industrial
Investors, LLC ("CalEast"). CalEast is a real estate operating company whose
members are LaSalle Investment Management, Inc. (a division of Xxxxx Xxxx
LaSalle ("JLL")) and the California Public Employees Retirement System
("CalPERS"). The Company owns 20% of this joint venture.
(2) In 2000, the Company formed a joint venture with Xxxxxxxx Investments, Inc
("3 Points Associates, LLC") to develop and construct an 800,000 square foot
distribution facility in Indiana. In January 2001, the joint venture signed a
ten-year lease with tenant for the entire facility. In June 2001, the Company
formed 4 Points Associates, LLC to develop and construct a 796,000 square foot
distribution facility in Indiana. The Company owns 50% of these ventures.
(3) The Company accounts for its investment in 100% of the non-voting preferred
stock in Keystone Realty Services, Inc. ( the "Management Company"), which
represents 95% of the total equity, in accordance with the equity method of
accounting. The Company is entitled to receive 95% of the amounts paid as
dividends by the Management Company,
(4) Consists of elimination adjustments for presentation purposes.
Page 12 of 23
KEYSTONE PROPERTY TRUST
-----------------------------------------------------------------------------------------------------------------------------------
EQUITY METHOD INVESTMENTS - PRO-RATA CONSOLIDATING STATEMENTS OF INCOME & FFO FOR THE QUARTER ENDED SEPTEMBER 30, 2001
(DOLLARS IN THOUSANDS)
Pro rata
Pro rata Keystone
Keystone Pro rata Realty
KTR NJ Associates, Airtech Services, Other Proforma
Historical LLC(1) Park (2) Inc. (3) Adjustments (4) Total
---------- -------------- -------- ----------- --------------- ----------
REVENUE:
Rents $ 24,112 $ 711 $ 304 $ -- $ -- $ 25,127
Reimbursement Revenue and Other 3,358 144 (14) 916 -- 4,404
-------- -------- -------- -------- -------- --------
Total revenue $ 27,470 $ 855 $ 290 $ 916 $ -- $ 29,531
======== ======== ======== ======== ======== ========
OPERATING EXPENSES:
Property Operating Expenses $ 2,100 $ 60 $ (21) $ -- $ -- $ 2,139
Real Estate Taxes 2,398 105 -- -- -- 2,503
-------- -------- -------- -------- -------- --------
Property NOI 22,972 690 311 916 -- 24,889
-------- -------- -------- -------- -------- --------
General and Administrative 2,268 3 2 736 -- 3,009
-------- -------- -------- -------- -------- --------
EBITDA 20,704 687 309 180 -- 21,880
Depreciation and Amortization 5,567 163 88 114 -- 5,932
Interest Expense 7,894 281 134 10 -- 8,319
-------- -------- -------- -------- -------- --------
Income before other items 7,243 243 87 56 -- 7,629
Equity in Income from Equity Method Investments 386 -- -- -- (386) --
Gains on Sales of Assets 10,025 -- -- -- -- 10,025
Extraordinary Items (94) -- -- -- -- (94)
Preferred Dividends, Preferred Distributions,
and Minority Interest (7,169) -- -- -- -- (7,169)
-------- -------- -------- -------- -------- --------
Net (Loss) Income Allocated to Common Shareholders $ 10,391 $ 243 $ 87 $ 56 $ (386) $ 10,391
======== ======== ======== ======== ======== ========
FFO
Income before Minority Interest of Unitholders in
Operating Partnership, Extraordinary, and Income
Allocated to Preferred Sharehoolders $ 17,654 $ 243 $ 87 $ 56 $ (386) $ 17,654
Gains on Sales of Assets (10,025) -- -- -- -- (10,025)
Depreciation and Amortization- Real Estate Assets 5,860 163 88 42 (293) 5,860
-------- -------- -------- -------- -------- --------
Funds from Operations $ 13,489 $ 406 $ 175 $ 98 $ (679) $ 13,489
======== ======== ======== ======== ======== ========
(1) On March 21, 2001, Keystone Property Trust ( the "Company") formed a joint
venture known as Keystone New Jersey Associates, LLC with CalEast Industrial
Investors, LLC ("CalEast"). CalEast is a real estate operating company whose
members are LaSalle Investment Management, Inc. (a division of Xxxxx Xxxx
LaSalle ("JLL")) and the California Public Employees Retirement System
("CalPERS"). The Company owns 20% of this joint venture.
(2) In 2000, the Company formed a joint venture with Xxxxxxxx Investments, Inc
("3 Points Associates, LLC") to develop and construct an 800,000 square foot
distribution facility in Indiana. In January 2001, the joint venture signed a
ten-year lease with tenant for the entire facility. In June 2001, the Company
formed 4 Points Associates, LLC to develop and construct a 796,000 square foot
distribution facility in Indiana. The Company owns 50% of these ventures.
(3) The Company accounts for its investment in 100% of the non-voting preferred
stock in Keystone Realty Services, Inc. ( the "Management Company"), which
represents 95% of the total equity, in accordance with the equity method of
accounting. The Company is entitled to receive 95% of the amounts paid as
dividends by the Management Company,
(4) Consists of elimination adjustments for presentation purposes.
Page 13 of 23
KEYSTONE PROPERTY TRUST
------------------------------------------------------------------------------------------------------------------------------
SUMMARY OF LAND UNDER DEVELOPMENT AND CONTROL
% Ownership
Project Interest / Partner Market/Submarket Acres
------------------------------------------------ ------------------ ------------------------------------- -------------
PROJECTS UNDER CONSTRUCTION
Keystone Cranbury West Phase II 100% New Jersey / Exit 8A 31
Keystone Cranbury East Phase I 100% New Jersey / Exit 8A 37
21 Roadway Expansion 100% Pennsylvania / Harrisburg 10
Airtech Park (4 Points Associates) 50% / Xxxxxxxx Indiana / Indianapolis Airport 43
-------------
SUBTOTAL - PROJECTS IN DEVELOPMENT 121
-------------
DEVELOPMENT PIPELINE (NEXT 36 MOS)
Northern New Jersey (1) 100% New Jersey / North 26
Keystone Cranbury East Phase II 100% New Jersey / Exit 8A 37
Goldstar Site 100% New Jersey / Exit 8A 50
Station Road (1) 100% New Jersey / Exit 8A 50
66 Station Road 20% / CalEast New Jersey / Exit 8A 62
Central PA (1) 100% Pennsylvania / Harrisburg 115
Airtech Park (1) 50% / Xxxxxxxx Indiana / Indianapolis Airport 90
-------------
SUBTOTAL - PIPELINE 430
-------------
ADDITIONAL DEVELOPMENT POTENTIAL
Xxxxxx Road 100% New Jersey / Exit 8A 6
Northeastern PA (1) 100% Pennsylvania / Northeastern PA 50
Central PA (1) 100% Pennsylvania / Harrisburg 100
Xxxxxx Road and Other Expansions 100% Pennsylvania / Reading, other 15
Airtech Park (1) 50% / Xxxxxxxx Indiana / Indianapolis Airport 235
-------------
SUBTOTAL - ADDITIONAL DEVELOPMENT POTENTIAL 406
-------------
TOTAL DEVELOPMENT POTENTIAL - PIPELINE ADDITIONAL 836
-------------
GRAND TOTAL 957
=============
KEYSTONE PROPERTY TRUST
-----------------------------------------------------------------------------------------------------------------------------------
SUMMARY OF LAND UNDER DEVELOPMENT AND CONTROL
Estimated Estimated Actual/Estimated Extimated
Buildable Project Con Incurred Construction Start Stabilization
Project SF Cost To Date Date (Qtr/Year) Date (Qtr/Year)
------------------------------------------------ ---------------- ----------- ------------ ------------------ --------------
PROJECTS UNDER CONSTRUCTION
Keystone Cranbury West Phase II 473,000 23 20 3/00 2/02
Keystone Cranbury East Phase I 510,000 23 15 3/00 3/02
21 Roadway Expansion 150,000 5 5 3/00 1/02
Airtech Park (4 Points Associates) 796,000 20 7 2/01 4/02
--------------- --------- ----------
SUBTOTAL - PROJECTS IN DEVELOPMENT 1,929,000 71 47
--------------- --------- ----------
DEVELOPMENT PIPELINE (NEXT 36 MOS)
Northern New Jersey (1) 530,000 33 - 2/02
Keystone Cranbury East Phase II 500,000 22 5 3/02
Goldstar Site 788,000 35 7 3/03
Station Road (1) 655,000 29 - 1/04
00 Xxxxxxx Xxxx 667,000 31 4 3/04
Central PA (1) 1,200,000 36 - 1/03
Airtech Park (1) 1,482,000 37 - 1/03
--------------- --------- ----------
SUBTOTAL - PIPELINE 5,822,000 223 16
--------------- --------- ----------
ADDITIONAL DEVELOPMENT POTENTIAL
Xxxxxx Road 130,000
Northeastern PA (1) 750,000
Central PA (1) 1,200,000
Xxxxxx Road and Other Expansions 221,000
Airtech Park (1) 3,518,000
---------------
SUBTOTAL - ADDITIONAL DEVELOPMENT POTENTIAL 5,819,000
---------------
TOTAL DEVELOPMENT POTENTIAL - PIPELINE ADDITIONAL 11,641,000
---------------
GRAND TOTAL 13,570,000
===============
(1) Under contract or option.
Page 14 of 23
KEYSTONE PROPERTY TRUST
-------------------------------------------------------------------------------------------------------------------------------
DEBT DETAIL (DOLLARS IN THOUSANDS, AS OF SEPTEMBER 30, 2001)
Fixed Rate Mortgages Variable Rate Debt
-------------------------------- -------------------------
Year of Monthly Due on Construction Credit Total Scheduled Wtd Avg
Maturity Amortization Maturity Loans Facilities Payments Fixed Rate Maturities
---------------- --------------- -------------- ------------- ----------- --------------- ---------------------
2001 $ 1,273 $ - $ - $ - $ 1,273 0.0%
2002 5,180 8,798 11,793 72,747 98,518 9.5%
2003 5,484 4,085 - - 9,569 8.5%
2004 5,821 39,722 - - 45,543 7.2%
2005 5,625 23,061 - - 28,686 8.2%
2006 5,802 22,018 - - 27,820 7.7%
2007 4,517 72,418 - - 76,935 7.9%
2008 4,619 90,545 - - 95,164 7.5%
2009 3,254 - - - 3,254 8.8%
2010 and thereafter 33,343 19,103 - - 52,446 7.8%
---------- ------------- ---------- ---------- ---------- ---------------
Total $ 74,918 $ 279,750 $ 11,793 $ 72,747 $ 439,208 7.8%
========== ============= ========== ========== ========== ===============
Debt Premium, Net of Amortization 2,197
----------
TOTAL DEBT OUTSTANDING $ 441,405
==========
Page 15 of 23
KEYSTONE PROPERTY TRUST
-------------------------------------------------------------------------------------------------------------------------------
PORTFOLIO ANALYSIS
September 30, June 30, March 31, December 31, September 30,
Portfolio Characteristics 2001 2001 2001 2000 2000
------------- ---------- ----------- ------------ -------------
Number of Properties-In Service 127 129 128 129 133
Number of Properties-Under Construction 4 4 3 4 5
---------- ---------- ---------- ---------- ----------
Total Number of Properties 131 133 131 133 138
========== ========== ========== ========== ==========
Rentable Square Feet -In Service 21,477,343 21,849,480 21,036,741 20,397,410 20,884,421
Rentable Square Feet-Under Construction 2,429,000 2,429,000 1,633,000 2,433,000 2,497,285
---------- ---------- ---------- ---------- ----------
Total Rentable Square Feet 23,906,343 24,278,480 22,669,741 22,830,410 23,381,706
========== ========== ========== ========== ==========
Occupied (Square Feet) 20,189,131 20,431,148 19,974,275 19,471,278 20,412,709
Vacant (Square Feet) 1,288,212 1,418,332 1,062,466 926,132 471,712
Number of Leases 286 283 280 301 316
Average Tenant Size per Occupied Square Foot-Industrial 146,241 149,513 154,442 152,433 140,773
Average Tenant Size per Occupied Square Foot-Office 12,687 12,779 12,519 12,664 12,711
Occupancy Rates -Based on In Service RSF 94.0% 93.5% 95.0% 95.5% 97.7%
NUMBER OF IN SERVICE PROPERTIES BY MARKET:
New Jersey 20 22 21 21 24
Pennsylvania 19 19 19 17 17
Indiana 6 6 6 5 5
---------- ---------- ---------- ---------- ----------
INDUSTRIAL CORE MARKET SUBTOTAL 45 47 46 43 46
========== ========== ========== ========== ==========
Ohio 11 11 11 11 11
New York 11 11 11 11 12
South Carolina 28 28 28 28 28
---------- ---------- ---------- ---------- ----------
INDUSTRIAL NON-CORE MARKET SUBTOTAL 50 50 50 50 51
========== ========== ========== ========== ==========
New Jersey 10 10 10 10 10
Pennsylvania 2 2 2 6 6
New York 20 20 20 20 20
---------- ---------- ---------- ---------- ----------
OFFICE NON-CORE MARKET SUBTOTAL 32 32 32 36 36
========== ========== ========== ========== ==========
Total In Service Properties 127 129 128 129 133
========== ========== ========== ========== ==========
Page 16 of 23
KEYSTONE PROPERTY TRUST
---------------------------------------------------------------------------------------------------------
PHYSICAL OCCUPANCY ANALYSIS
September 30, June 30, March 31, December 31, September 30,
Physical Occupancy by Sub-Market: 2001 2001 2001 2000 2000
------------- --------- --------- ------------ -------------
INDUSTRIAL
Central and Northern NJ 99.2% 100.0% 95.8% 100.0% 99.8%
Xxxxxxx County, PA 100.0% 100.0% 100.0% 100.0% 100.0%
Harrisburg/Chambersburg, PA 95.5% 94.6% 98.4% 97.8% 100.0%
Reading, PA 100.0% 100.0% 100.0% 100.0% 100.0%
Scranton/Xxxxxx-Xxxxx, PA 100.0% 100.0% 100.0% 100.0% 100.0%
Indianapolis, IN 100.0% 100.0% 100.0% 100.0% 100.0%
------- ------- ------- ------- -------
Total Core Portfolio 98.4% 98.3% 97.7% 99.6% 99.9%
======= ======= ======= ======= =======
Central Ohio 94.5% 96.2% 96.2% 92.3% 100.0%
Albany, NY 100.0% 100.0% 100.0% 100.0% 100.0%
Rochester, NY 98.0% 92.7% 92.7% 89.5% 88.1%
Syracuse, NY 16.0% 16.0% 100.0% 100.0% 100.0%
Greenville/Spartanburg, SC 88.3% 83.0% 79.1% 78.8% 88.9%
------- ------- ------- ------- -------
Total Non-Core Industrial 83.3% 81.1% 88.6% 87.2% 94.3%
======= ======= ======= ======= =======
Total Industrial Portfolio 93.8% 93.3% 94.8% 95.3% 97.9%
======= ======= ======= ======= =======
OFFICE
Central and Northern NJ 97.7% 98.9% 98.9% 98.7% 98.4%
Albany, NY 95.9% 96.0% 97.2% 98.1% 99.8%
Rochester, NY 100.0% 100.0% 100.0% 100.0% 100.0%
Syracuse, NY 96.2% 91.9% 95.6% 97.2% 96.7%
Allentown, PA -- -- -- 91.9% 94.0%
Harrisburg/Chambersburg, PA 78.8% 71.2% 71.2% 89.5% 83.4%
Reading, PA 81.6% 81.6% 84.3% 89.5% 93.0%
------- ------- ------- ------- -------
Total Office Portfolio 96.1% 95.6% 96.0% 96.4% 96.3%
======= ======= ======= ======= =======
Page 17 of 23
KEYSTONE PROPERTY TRUST
---------------------------------------------------------------------------------------------------------------------------------
PREFERRED EQUITY ANALYSIS (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
September 30, June 30, March 31, December 31, September 30,
2001 2001 2001 2000 2000
-------------- ------------- ------------- ------------- -------------
CONVERTIBLE PREFERRED STOCK
Series A
Shares Outstanding 800,000 800,000 800,000 800,000 800,000
Aggregate Liquidation Value $ 20,000 $ 20,000 $ 20,000 $ 20,000 $ 20,000
Liquidation Value Per Share $ 25.00 $ 25.00 $ 25.00 $ 25.00 $ 25.00
Common Share Conversion Price $ 16.50 $ 16.50 $ 16.50 $ 16.50 $ 16.50
Yield 9.00% 9.00% 9.00% 9.00% 9.00%
Series B (1)
Shares Outstanding -- 803,871 803,871 803,871 803,871
Aggregate Liquidation Value $ -- $ 20,097 $ 20,097 $ 20,097 $ 20,097
Liquidation Value Per Share $ -- $ 25.00 $ 25.00 $ 25.00 $ 25.00
Common Share Conversion Price $ -- $ 16.00 $ 16.00 $ 16.00 $ 16.00
Yield -- 9.75% 9.75% 9.75% 9.75%
Series C
Shares Outstanding 800,000 800,000 800,000 800,000 800,000
Aggregate Liquidation Value $ 20,000 $ 20,000 $ 20,000 $ 20,000 $ 20,000
Liquidation Value Per Share $ 25.00 $ 25.00 $ 25.00 $ 25.00 $ 25.00
Common Share Conversion Price $ 15.75 $ 15.75 $ 15.75 $ 15.75 $ 15.75
Yield 9.75% 9.75% 9.75% 9.75% 9.75%
CONVERTIBLE PREFERRED OPERATING
PARTNERSHIP UNITS
Series B
Units Outstanding 300,000 300,000 300,000 300,000 300,000
Aggregate Liquidation Value $ 7,500 $ 7,500 $ 7,500 $ 7,500 $ 7,500
Liquidation Value Per Share $ 25.00 $ 25.00 $ 25.00 $ 25.00 $ 25.00
Common Share Conversion Price $ 16.50 $ 16.50 $ 16.50 $ 16.50 $ 16.50
Yield 9.50% 9.50% 9.50% 9.50% 9.50%
Series C (2)
Units Outstanding 1,664,965 2,461,094 2,461,094 2,461,094 2,461,094
Aggregate Liquidation Value $ 41,624 $ 61,527 $ 61,527 $ 61,527 $ 61,527
Liquidation Value Per Share $ 25.00 $ 25.00 $ 25.00 $ 25.00 $ 25.00
Common Share Conversion Price $ 16.00 $ 16.00 $ 16.00 $ 16.00 $ 16.00
Yield 9.75% 9.75% 9.75% 9.75% 9.75%
Series D
Units Outstanding 450,700 450,700 450,700 450,700 450,700
Aggregate Liquidation Value $ 11,268 $ 11,268 $ 11,268 $ 11,268 $ 11,268
Liquidation Value Per Share $ 25.00 $ 25.00 $ 25.00 $ 25.00 $ 25.00
Common Share Conversion Price $ 16.50 $ 16.50 $ 16.50 $ 16.50 $ 16.50
Yield 9.00% 9.00% 9.00% 9.00% 9.00%
Total Liquidation/Book Value of
Preferred Stock $ 100,392 $ 140,392 $ 140,392 $ 140,392 $ 140,392
============= ============= ============= ============= =============
(1) These Convertible Preferred Shares were re-purchased and retired by the
Company on August 27, 2001
(2) 796,129 Convertible Preferred OP Units were re-purchased and retired by
the Company on August 27, 2001
Page 18 of 23
KEYSTONE PROPERTY TRUST
-----------------------------------------------------------------------------------------------------------------------------------
EQUITY ANALYSIS (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
September 30, June 30, March 31, December 31, September 30,
2001 2001 2001 2000 2000
------------- ----------- ---------- ------------- --------------
Total Outstanding in Common Share
Equivalents at Quarter-End:
Common Shares 18,396,540 15,521,540 9,346,669 9,321,296 9,323,312
Common Operating Partnership Units 6,356,885 6,731,885 7,667,649 7,675,649 7,675,649
Preferred Stock 2,481,962 3,738,010 3,738,010 3,738,010 3,738,010
Preferred Operating Partnership Units 3,738,932 4,982,884 4,982,884 4,982,884 4,982,884
----------- ----------- ----------- ----------- -----------
Total 30,974,319 30,974,319 25,735,212 25,717,839 25,719,855
Weighed Average Outstanding for the
Respective Quarter:
Common Shares 16,570,452 13,640,254 9,342,775 9,322,657 9,322,119
Common Operating Partnership Units 6,634,059 6,913,164 7,668,627 7,675,649 7,677,660
Preferred Shares (at Common Share Equivalents) 3,260,166 3,738,010 3,738,010 3,738,010 3,738,010
Preferred Operating Partnership Units (at Common
Share Equivalents) 4,509,641 4,982,884 4,982,884 4,982,884 4,982,884
Common Stock Options 22,932 3,160 5,150 3,349 3,885
----------- ----------- ----------- ----------- -----------
Total 30,997,250 29,277,472 25,737,446 25,722,549 25,724,558
Common Share Price Range:
Quarterly High $ 14.38 $ 13.18 $ 14.12 $ 13.06 $ 14.44
Quarterly Low 10.68 11.43 12.75 12.31 12.00
Quarterly Average 13.17 12.21 13.36 12.71 13.33
End of Quarter 12.70 13.39 12.85 12.75 12.50
Common Stock Options Outstanding 1,342,187 1,322,187 592,050 612,383 612,383
Weighted Average Option Exercise Price $ 13.85 $ 13.81 $ 15.05 $ 15.05 $ 15.05
Capitalization:
Liquidation/Book Value of Preferred Stock $ 100,392 $ 140,392 $ 140,392 $ 140,392 $ 140,392
Market Value of Common Equity 314,368 297,973 218,634 216,711 212,487
----------- ----------- ----------- ----------- -----------
Market Capitalization 414,760 438,365 359,026 357,103 352,879
Total Debt 441,405 454,069 499,781 616,569 633,652
----------- ----------- ----------- ----------- -----------
Total Market Capitalization $ 856,165 $ 892,434 $ 858,807 $ 973,672 $ 986,531
(Market Capitalization + Total Debt) =========== =========== =========== =========== ===========
Page 19 of 23
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DEBT ANALYSIS (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
September 30, June 30, March 31, December 31, September 30,
2001 2001 2001 2000 2000
------------- ------------ ------------ ------------ --------------
Debt Outstanding
Mortgage Loans $ 354,668 $ 374,150 $ 378,482 $ 475,193 $ 490,063
Construction Loans 11,793 11,614 12,870 13,594 7,398
Revolving Credit Facilities 72,747 65,771 105,731 124,928 133,183
Debt Premium, Net of Amortization 2,197 2,534 2,699 2,853 3,008
--------- --------- --------- --------- ----------
Total Debt Outstanding $ 441,405 $ 454,069 $ 499,781 $ 616,569 $ 633,652
========= ========= ========= ========= ==========
Interest Rate Structure
Fixed $ 354,668 $ 374,150 $ 366,172 $ 460,395 $ 462,264
Variable 84,540 77,385 130,910 153,321 168,380
--------- --------- --------- --------- ----------
Total $ 439,207 $ 451,535 $ 497,082 $ 613,716 $ 630,644
========= ========= ========= ========= ==========
% of Fixed Rate Loans 80.8% 82.9% 73.7% 75.0% 73.3%
% of Variable Rate Loans 19.2% 17.1% 26.3% 25.0% 26.7%
Average Interest Rates
Mortgage Loans 7.8% 7.8% 7.8% 7.8% 7.8%
Construction Loans 5.8% 6.4% 7.7% 8.7% 8.6%
Revolving Credit Facilities 4.6% 5.5% 7.5% 9.1% 8.9%
--------- --------- --------- --------- ----------
Total Weighted Average 7.2% 7.4% 7.7% 8.0% 8.0%
========= ========= ========= ========= ==========
Debt Ratios
Debt to Total Market Capitalization 51.6% 50.9% 58.2% 63.3% 64.2%
Debt to Undepreciated Book Value of Real Estate Assets 49.6% 50.8% 56.8% 61.5% 62.4%
Coverage Ratios
Interest Coverage-Property NOI 2.9x 2.7x 2.2x 2.1x 2.1x
(NOI / Interest)
Interest Coverage-EBITDA 2.6x 2.4x 2.0x 2.0x 1.9x
(EBITDA / Interest)
Interest Coverage-EBITDA-YTD 2.3x 2.2x 2.0x 2.0x 2.0x
(EBITDA / Interest - Year-to-date)
Debt Service Coverage -Property NOI 2.5x 2.3x 2.0x 2.0x 1.9x
(NOI / (Interest + Principal Amortization))
Debt Service Coverage - EBITDA 2.3x 2.1x 1.8x 1.8x 1.8x
(EBITDA / (Interest + Principal Amortization))
Fixed Charge Coverage -Property NOI 2.1x 1.9x 1.7x 1.7x 1.7x
(NOI / (Interest + Preferred Distributions))
Fixed Charge Coverage - EBITDA 1.9x 1.7x 1.5x 1.5x 1.5x
(EBITDA / (Interest + Preferred Distributions))
Page 20 of 23
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QUARTERLY VALUATION ANALYSIS
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA AND RATIOS)
September 30, June 30, March 31, December 31, September 30,
2001 2001 2001 2000 2000
------------- --------- --------- ------------ -------------
PRICING MULTIPLES
NOI Multiple
((Market Value of Common Equity +
Preferred Share/Units + Total Debt)/Xxx. NOI) 9.3x 9.9x 9.8x 9.3x 9.3x
EBITDA Multiple
((Market Value of Common Equity +
Preferred Share/Units + Total Debt)/Xxx. EBITDA) 10.3x 10.9x 9.4x 9.8x 10.4x
FFO Multiple
(Quarter End Common Share Price / Xxx. FFO - per share) 7.2x 7.8x 7.1x 6.6x 6.6x
FAD Multiple
(Quarter End Common Share Price / Xxx. FAD - per share) 8.1x 8.6x 8.9x 8.0x 8.9x
NOI Yield
(Xxx. NOI before Interest and Depreciation Expense /
(Market Value of Common Equity + Preferred
Share/Units + Debt)) 10.7% 10.1% 10.2% 10.8% 10.7%
XXXXXX Xxxxx
(Xxx. EBITDA / (Market Value of Common Equity +
Preferred Share/Units + Debt)) 9.7% 9.1% 10.7% 10.2% 9.7%
FFO Yield
(Xxx. FFO - per share / Quarter End Common Share Price) 13.9% 12.8% 14.0% 15.1% 15.0%
XXX Xxxxx
(Xxx. FAD - FAD per share / Quarter End Common
Share Price) 12.3% 11.7% 11.2% 12.5% 11.2%
RETURNS
Yield on Real Estate Owned - NOI
(Xxx. NOI before Interest and Depreciation Expense /
Average Gross Operating Real Estate Investments) 11.0% 10.9% 10.9% 10.9% 10.8%
Yield on Real Estate Owned - EBITDA
(Xxx. EBITDA / Average Gross Operating Real
Estate Investments) 9.9% 9.9% 10.3% 10.3% 9.7%
Return on Book Value of Average Equity & Minority Interest
(Xxx. EBITDA / Avg. Equity & Minority Interest) 22.1% 23.6% 28.6% 30.5% 28.5%
FFO Return on Book Value of Average Equity & Minority
Interest (Xxx. FFO / Avg. Equity & Minority Interest) 14.4% 14.4% 14.3% 15.1% 14.3%
Page 21 of 23
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DIVIDEND ANALYSIS
September 30, June 30, March 31, December 31, September 30,
2001 2001 2001 2000 2000
------------- ----------- ---------- -------------- -------------
COMMON STOCK DIVIDENDS:
Dividends per Share/Unit $ 0.32 $ 0.31 $ 0.31 $ 0.31 $ 0.31
Declaration Date 7/5/2001 4/12/2001 1/8/2001 10/3/2000 7/5/2000
Common Shareholders' Record Date 7/16/2001 4/20/2001 1/18/2001 10/16/2000 7/17/2000
Common Dividends Payment Date 7/31/2001 4/30/2001 1/31/2001 10/30/2000 7/31/2000
COMMON DIVIDEND PAYOUT RATIOS:
Payout - FFO
(Dividends/FFO) 72.7% 72.1% 68.9% 64.6% 66.0%
Payout - FAD
(Dividends/FAD) 82.1% 79.5% 86.1% 77.5% 88.6%
Dividend Coverage - FFO
(FFO/Dividends) 1.4x 1.4x 1.5x 1.5x 1.5x
Dividend Coverage - FAD
(FAD/Dividends) 1.2x 1.3x 1.2x 1.3x 1.1x
COMMON DIVIDEND YIELDS:
Dividend Yield 10.1% 9.3% 9.6% 9.7% 9.9%
Spread Over 5 Year U.S. Treasury at quarter end 6.3% 4.6% 5.1% 4.7% 4.1%
Spread Over 10 Year U.S. Treasury at quarter end 5.5% 4.1% 4.7% 4.6% 4.1%
Page 22 of 23
KEYSTONE PROPERTY TRUST
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RESEARCH COVERAGE
Firm Analyst Phone
---------------------------- ---------------------- ---------------------
Xxxxxxxxx Xxxxxxxx Xxx Xxxxx 000-000-0000
Xxxxx Xxxx 000-000-0000
Bear, Xxxxxxx & Co., Inc. Xxxx Xxxxxxxx 000-000-0000
Xxxx Xxxxx 000-000-0000
Credit Suisse First Boston Xxxxxxxx Xxxxxx 000-000-0000
Xxxxxxx Xxxxxxx 000-000-0000
Wachovia Capital Markets Xxxxxxxxxxx X. Xxxxx 000-000-0000
Xxxxxx Xxxxxxxx 000-000-0000
Xxxxxxx Xxxxx Xxxxx Xxxxx 000-000-0000
Page 23 of 23
