<PAGE>

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-K/A

(Mark One)

     X   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    ---  EXCHANGE ACT OF 1934 (FEE REQUIRED)

         For the fiscal year ended DECEMBER 31, 1998 or

         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    ---  EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

        For the transition period from ______________ to _______________

                         Commission file number    1-12630
                                                -------------

                          CENTERPOINT PROPERTIES TRUST
              ----------------------------------------------------
             (Exact Name of Registrant as Specified in its Charter)

           Maryland                                      36-3910279
-------------------------------------------------------------------------------
(State or Other Jurisdiction of             (I.R.S. Employer Identification No.)
Incorporation or Organization)

1808 Swift Drive, Oak Brook, Illinois             60523
---------------------------------------          --------
(Address of principal executive offices)        (Zip code)

Registrant's telephone number, including area code:       (630) 586-8000
                                                      ----------------------

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

<TABLE>
<CAPTION>
     Title of Each Class                                    Name of Each Exchange On Which Registered
     -------------------                                    ------------------------------------------
<S>                                                         <C>
Common Shares, par value $.001                                         New York Stock Exchange
8.22% Convertible Subordinated Debentures due 2004                     New York Stock Exchange
8.48% Preferred Shares, par value $.001                                New York Stock Exchange
Preferred Share Purchase Rights,
     with respect to common shares, par $.001                          New York Stock Exchange
</TABLE>

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

                                      None
                  ------------------------------------------------
                                (Title of Class)

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

 X   Yes     No
---      ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (Section229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K/A or any amendment to this Form 10-K/A. [ ]

As of March 11, 1999, the aggregate market value of the voting stock held by
non-affiliates of the registrant was $624,185,696 (based on 19,505,803 shares
held by non-affiliates and computed by reference to the reported closing price).

The registrant had 20,051,448 shares of its common stock, $.001 par value,
outstanding as of March 11, 1999.

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of Common Stock and Debenture Prospectuses of the registrant, dated
December 3, 1993, and a Common Stock Prospectus of the registrant, dated January
19, 1995, each filed pursuant to Rule 424 under the Securities Act of 1933, as
amended, portions of the Registration Statement on Form S-3 dated January 6,
1997, portions of the registrant's Form 10-Q for the quarter ended September 30,
1995, portions of the 10-K for the year ended December 31, 1995 and portions of
the 10-Q for quarter ended September 30, 1996 are incorporated by reference into
Part IV of this Annual Report on Form 10-K/A. A portion of the registrant's
definitive proxy statement is incorporated by reference into Part III of this
Annual Report on Form 10-K/A.


<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                   PART I                                                                      Page
                                   ------                                                                      ----

<S>                                                                                                            <C>
Item 1.       Business............................................................................................1

Item 2.       Properties.........................................................................................12

Item 3.       Legal Proceedings..................................................................................24

Item 4.       Submission of Certain Items to a Vote of Security Holders..........................................24


                                     PART II
                                     -------

Item 5.       Market for Registrant's Common Equity and Related Matters..........................................25

Item 6.       Selected Historical Financial Data.................................................................26

Item 7.       Management's Discussion and Analysis of Financial Condition and Results of Operations..............29

Item 7A.      Quantitative and Qualitative Disclosures about Market Risk.........................................36

Item 8.       Financial Statements and Supplementary Data........................................................37

Item 9.       Changes in and Disagreements with Accountants on Accounting and Financial Disclosure...............37


                                    PART III
                                    --------

Item 10.      Directors and Executive Officers of the Registrant.................................................39

Item 11.      Executive Compensation.............................................................................39

Item 12.      Security Ownership of Certain Beneficial Owners and Management.....................................39

Item 13.      Certain Relationships and Related Transactions.....................................................39

                                     PART IV
                                     -------

Item 14.      Exhibits, Financial Statement Schedules and Reports on Form 8-K....................................40
</TABLE>


<PAGE>

                                     PART I

ITEM 1.       BUSINESS.

THE COMPANY

         CenterPoint Properties Trust ("CenterPoint" or the "Company"), a
publicly traded real estate investment trust (REIT), is the first major REIT to
focus on the industrial sector. CenterPoint is focused on providing unsurpassed
tenant satisfaction, and adds value to its shareholders through customer-driven
management, investment, development, and redevelopment of warehouse, light
manufacturing, and industrial facilities. The Company believes it is the largest
owner and operator of warehouse/industrial property in the 1.25 billion
square-foot Greater Chicago Region, the largest and most diverse industrial
market in the United States. The Company is a Maryland business trust and is
listed on the New York Stock Exchange.

         A predecessor of CenterPoint began operations in 1984 as the principal
division and U.S. subsidiary of United Kingdom-based Capital and Regional
Properties. The stock of Capital and Regional was publicly traded on the London
Exchange in 1986, providing the Company with the longest public market history
of any industrial REIT. CenterPoint completed its initial U.S. public offering
after consolidating its operations with, and acquiring the properties controlled
by, FCLS Investors Group, a Chicago-based industrial development company with 30
years local experience.

         In July 1998, the Company consolidated its three regional offices into
redeveloped warehouse space suburban Oak Brook, Illinois, centrally located in
the Chicago region. Intentionally, all of CenterPoint's assets are located
within a two-hour drive of its headquarters. The Company believes that its
geographic focus has enabled rapid and entrepreneurial response to market
opportunities and has fostered constant interaction among tenants and management
in furtherance of the Company's focus on customer satisfaction, which anchors
CenterPoint's strategy.

BUSINESS OBJECTIVES AND GROWTH PLANS

         The Company's fundamental business objective is to maximize total
return to shareholders through increases in per share distributions and
increases in the value of the Company's franchise. The Company's goal is to
sustain strong growth in per share funds from operations ("FFO"), with
accompanying growth in per share distributions and share value. To achieve this
objective, the Company pursues complementary operating, investment, disposition
and financial strategies:

-    PORTFOLIO OPERATIONS. The Company seeks to grow its results from operations
     by increasing revenues through lease renewals or replacements at increased
     rental rates and by increasing occupancy where vacancies exist. The Company
     believes above average rental growth is primarily achievable because the
     Company's focus on tenant service generates higher renewal and occupancy
     rates. Moreover, the Company's size, Chicago focus and market penetration
     provide superior access to favorable leasing transactions and investments
     offering below market rents and growth opportunities. The Company's
     property investments as of December 31, 1998 was leased at an average net
     rental rate of $3.57 per square foot, approximately 25% below the average
     market rental rate (published by CB Richard Ellis)of $4.67 per square foot.


                                       1
<PAGE>

-    INVESTMENT. The Company believes that per share growth is maximized through
     investment activity concentrating on properties offering immediate cash
     yields above its long term cost of capital, with the potential for rapid
     yield growth. The Company seeks to invest exclusively in
     warehouse/industrial properties that satisfy its yield and growth
     objectives through the lease up of vacancy, property expansion,
     redevelopment, or the development or disposition of surplus land. The
     Company strictly limits speculative investment.

-    DISPOSITIONS. Management undertakes to maximize the yield on invested
     capital by aggressively selling properties where growth has been achieved
     and where future prospects for growth are limited. As an allied strategy,
     the Company undertakes the development of buildings for immediate sale to
     users or investors. These "merchant" transactions provide attractive fees
     and profits for reinvestment in the Company's "core" value added business.

-    FINANCIAL. The Company maintains conservative financial and leverage
     policies to provide financial capacity and flexibility. This strategy
     facilitates opportunistic investment by helping assure substantial in place
     liquidity. The Company and its affiliates maintain lines of credit of $300
     million. The Company's financial strategy also allows it to secure capital
     in the most favorable markets. CenterPoint benefits from investment grade
     ratings on its senior unsecured debt and preferred securities, providing
     substantial execution efficiency and a lower overall cost of capital.

-    MANAGEMENT CONTROLS AND SYSTEMS. The Company's strategy also seeks growth
     by controlling expenses through the implementation of efficient information
     and governance systems. The Company has invested in state of the art
     systems, which it seeks to continually improve. The Company also believes
     that it enjoys operating efficiencies attributable to the scale of its
     operations and Chicago market focus, generating greater rates of cash flow
     growth and retention.

BUSINESS FOCUS

         As CenterPoint continues to grow, its mission remains to become the
industrial landlord of choice in the Greater Chicago region. CenterPoint
endeavors to achieve this goal by cultivating and maintaining long-term
relationships with its tenants. The Company, highly responsive to the changing
needs of its tenants, is always prepared to meet any challenge, and is
continually innovating processes and procedures to enhance mutual growth.
CenterPoint seeks to provide high-quality, attractive space at competitive
rates; unwavering attention to the care and maintenance of its properties;
operating charges that reflect economic responsibility; and rapid response to
expansion, relocation and other space requirements. CenterPoint maintains a 93%
tenant retention rate, confirming its commitment to tenant satisfaction, and in
turn, increasing both cash flow and the value of the portfolio.

         Underpinning the value of CenterPoint's portfolio is the strength of
its internal resources. Key among these is management experience. CenterPoint's
management staff averages 20 years of experience in the industry. Enabled by
strong ties to the real estate development community, an in-depth knowledge of
the market sector, and the ability to gauge and anticipate market trends,
management can creatively and flexibly accommodate tenant requirements in a
manner that is mutually beneficial.

         In order to successfully execute its business strategies, CenterPoint
adheres to the five following disciplines:


                                       2
<PAGE>

         FOCUS ON INDUSTRIAL REAL ESTATE. The Company focuses on
warehouse/industrial properties, because management believes this property type,
for the following reasons, offers consistently attractive returns and stable
cash flow:

          -    LOW CAPITAL REQUIREMENTS. The cost per square foot of developing
               warehouse/industrial properties typically ranges between $40-45
               per square foot, which is lower than the cost of developing other
               types of property. From the Company's perspective, this results
               in less capital committed to any particular property, permitting
               greater diversification of the Company's risk. In addition,
               relative to other property types, fewer tenant improvements are
               required to renew or lease warehouse industrial space, minimizing
               the level of recurring capital expenditures necessary to sustain
               rental income.

          -    HIGH LEVEL OF TENANT INVESTMENT. Unlike office, retail and
               multi-family buildings, most warehouse/industrial buildings are
               occupied by a single tenant. Relocation tends to be costly for
               tenants of warehouse/industrial properties because of high tenant
               investment in production set up expenses, machinery and other
               site specific improvements (in many cases higher than the
               landlord's investment). To avoid these costs, tenants typically
               lease space that exceeds their immediate needs or space in
               buildings that are readily expandable. Tenant retention and
               expansion therefore tend to be higher than for other property
               types.

          -    FAVORABLE LEASE TERMS. Warehouse/industrial buildings generally
               are leased on a "triple net" basis, under which tenants are
               contractually obligated to pay directly, or reimburse the
               landlord, for virtually all costs of occupancy, including
               property taxes, utilities, insurance and maintenance. In
               addition, the leases generally provide for rent growth through
               contractual rent increases or increases tied to certain indices
               such as the Consumer Price Index.

          -    SUPPLY BUILT ON DEMAND. The comparatively short development
               period for industrial buildings (typically six to nine months)
               relative to other property types has resulted in less speculative
               building and, therefore, a supply of industrial property that
               more closely corresponds to tenant demand. This has kept vacancy
               levels on average lower than for other property types and has
               produced greater rental rate stability.

          -    LIMITED COMPETITION. Higher overall investment returns are more
               achievable for warehouse/industrial property than other property
               types because such assets, typically $3 million to $6 million in
               purchase price, are too small to justify institutional attention.
               The Company's typical competitor for assets of this size is a
               sponsor of a single asset partnership that typically has a higher
               cost of capital and less financial flexibility than the Company.


                                       3
<PAGE>

         FOCUS IN GREATER CHICAGO. CenterPoint's target market, Greater Chicago,
is comprised of the region within a 150-mile radius of the City of Chicago,
including Milwaukee, Wisconsin and South Bend, Indiana. It lies at the center of
one of the nation's principal population and production regions.

         With over 1.5 billion square-feet of industrial/warehouse space
(according to a ranking of markets published by Torto Wheaton Research and CB
Richard Ellis), Greater Chicago has become the largest and most diverse
warehouse/industrial market. In addition to its size and geographic location,
the Midwest possesses certain critical components such as transportation
advantages, business diversity, favorable economic trends, and thriving real
estate market conditions. These factors have supported the Company's continued
strong leasing, acquisition, and development activity. As a result, Greater
Chicago offers significant opportunities for investment in, and ownership of,
warehouse/industrial property.

         -    TRANSPORTATION ADVANTAGES. The Midwest's transportation network is
              integral to its status as a manufacturing and distribution center.
              The area has achieved its prominence as a result of its central
              continental location, as well as its extensive roadway, rail, air,
              and water transportation infrastructure. This infrastructure
              connects Greater Chicago with a contiguous 13-state region
              consisting of Illinois, Wisconsin, Michigan, Ohio, Pennsylvania,
              West Virginia, Tennessee, Kentucky, Indiana, Missouri, Iowa,
              Nebraska and Minnesota.

              Seven major east-west or north-south interstate highways either
              terminate or pass through the Greater Chicago region, making it
              the nation's largest trucking market. This infrastructure
              accommodates approximately 418,000 truck movements per day. In
              Chicago alone, approximately 220,000 cross-town truck trips are
              made to move containers between rail terminals annually.
              CenterPoint expects Greater Chicago will soon see further growth
              as the new administration of Governor George Ryan accelerates the
              expansion and improvement of metro Chicago's expressway and other
              infrastructures.

              Intermodal, which involves the movement of goods by two or more
              modes of transportation, is re-emerging as a very attractive
              distribution channel. Rail service and marshalling yards in the
              Midwest handle approximately 75% of nation's rail freight, making
              Chicago a major hub for intermodal freight transportation. Nearly
              half of all intermodal rail shipments originate, terminate, or
              connect there. Currently, it is the fastest growing part of the
              rail industry, and most rail yards have already been converted to
              handle intermodal traffic. On a daily basis, Chicago alone handles
              nearly 23,000 freight cars and 13,500 intermodal freight
              containers and truck trailers, far more than any other city.

              O'Hare International Airport, located within Chicago's city
              limits, is one of the country's fastest growing airfreight hubs,
              and has spurred the expansion of this industry in the region. The
              efficiency and quick turn-around time of airfreight has made it
              the delivery method of choice for many shippers. By handling 3,722
              tons of airfreight per day, in addition to the 70 million
              commercial passengers it serves annually, O'Hare has earned its
              moniker of "the world's busiest airport".

              Lastly, Chicago is also a major gateway for waterborne freight.
              The Port of Chicago estimates that it ships in excess of 25
              million tons of freight annually.

         -    DIVERSITY OF BUSINESSES. Published census data indicate that
              Greater Chicago is the dominant economic, work, and population
              center of this region. Not only does the Chicago region


                                       4
<PAGE>

              contain the nation's largest job market, but one-third of the
              nation's Gross Domestic Product is created and consumed within 8
              hours of Chicago, making it one of the most important export hubs
              in the nation. Many of the exports are of manufactured goods made
              in the state of Illinois. In 1997, total exports grew by 5.4% to
              $23,210 million, a greater increase than during the previous year.
              Home to over 59,000 industrial and commercial firms, Chicago is
              second only to New York in the number of Fortune 500 corporate
              headquarters. Virtually all of the "Global 1000""maintain
              facilities in the Chicago metro area.

              The diversity of businesses in the Midwest provides the Company
              with the opportunity to capitalize on different trends affecting
              real estate demand and usage in a wide range of industries. An
              assorted tenant base also lessens the Company's cyclical risk,
              reducing its exposure to changes in the fortunes of any single
              type of business.

              For example, manufacturing companies are one component of the
              Company's tenant mix. Greater Chicago's manufacturing base is
              extremely diverse, with nearly equal shares of durable and
              non-durable industries in a broad mix of old-line and high-tech
              manufacturing. In recent years, Chicago has had great success in
              attracting manufacturing expansions because manufacturers benefit
              from Chicago's well-developed transportation systems and
              distribution network. Zoning initiatives have further encouraged
              manufacturing activity by producing Planned Manufacturing
              Districts (PMDs) in the city proper.

              However, as in other large industrial metropolitan areas, Greater
              Chicago's diversity has been increasing with the transformation
              from a manufacturing to a service-based economy. The
              diversification has accelerated during the current expansion as
              growth has been driven by service industries.

         -    FAVORABLE ECONOMIC TRENDS/CHARACTERISTICS. Manufacturing,
              productivity, business investment, capacity utilization, and
              employment trends in the Midwest region of the U.S. and in Greater
              Chicago are positive. The Midwest has also recorded increases in
              industrial employment opportunities, and has exceeded the rates of
              growth of the United States as a whole. These trends are favorable
              indicators of continuing growth in the warehouse/industrial
              property market.

              In recent months, the unemployment rate in Chicago has averaged
              only 4.3%, about equal to the national rate. Job creation has
              helped to keep the jobless rate this low.

              Business services in particular have expanded strongly due to the
              concentration of headquarters operations in the metro area, as
              well as the growth of the computer software industry. Business
              services account for 40% of the new jobs created in the Chicago
              economy during the past year.

              The concentration of high technology employment ranks Chicago
              third in the nation. Of all the metro areas in the Midwest, the
              Chicago economy has been most successful in developing its
              high-technology industries. The Chicago metro area, in particular,
              has a concentration of information technology businesses involved
              in every aspect of digitally based products and services such as
              software, electronic commerce, computer hardware, and telecom
              services. The number of Chicago-based information technology
              companies has increased by one-third since 1992 and employment has
              increased by more than 20%. Growth in high tech services is
              expected to remain strong.


                                       5
<PAGE>

              Chicago is also the largest financial center for commodities in
              the United States. The Chicago Board of Trade (CBOT) is the
              world's largest commodities exchange and the Chicago Mercantile
              Exchange (CME) is the third largest.

         -    REAL ESTATE MARKET CONDITIONS/WAREHOUSE SUPPLY & DEMAND. Favorable
              trends in growth, business investment, utilization, and employment
              in the Midwest have resulted in increased space demand and
              increasing rents. Although the Company believes it is the largest
              owner and operator of warehouse/industrial property in Greater
              Chicago, its portfolio represented less than 2% of the market
              (based on square footage) as of December 31, 1998. In a 1.25
              billion square-foot industrial market, this allows substantial
              opportunities for future growth.

              Geographic concentration provides significant business
              efficiencies for the Company. As a primary owner of
              warehouse/industrial property located in most major Greater
              Chicago submarkets, the Company is able to market multiple
              locations and buildings, and consequently has a competitive
              advantage in securing leasing opportunities. Operating economies
              of scale resulting from geographic concentration enhances the
              Company's ability to offer lower occupancy costs to its tenants.
              The Company's focus on warehouse/industrial properties in Greater
              Chicago also enables the expansion of its portfolio without a
              corresponding increase in general and administrative expense.

              According to CB Richard Ellis, during 1998 Chicago's industrial
              property market added 33.5 million square feet, the fifth
              consecutive year of 30.0 million square feet or greater gross
              absorption. Gross regional absorption was approximately 38.0
              million square feet and 75% of the transactions were from new
              leases. In the fourth quarter of 1998 the overall nominal
              industrial vacancy rate in Chicago was 6.9%, a decrease of 100
              basis points from the fourth quarter of 1997. However, the
              effective vacancy rate (net of obsolete and environmentally
              tainted properties) remained less than 4% overall.

         FOCUS ON TENANT SATISFACTION. To become the landlord of choice in the
Greater Chicago Region, the Company strives to provide the highest possible
service to its tenants by addressing its tenants' occupancy needs and meeting
their evolving space requirements. Management believes tenant satisfaction,
resulting from the Company's "hands on" management approach, fuels rental
revenues by increasing tenant retention, minimizing re-letting expense and
facilitating rental increases. Management also believes that tenant satisfaction
creates profitable expansion and build-to-suit opportunities from existing
tenants.

         The Company views tenant service as a key factor in its business and
has established tenant satisfaction as one of its primary corporate goals. To
develop its tenant franchise, the Company provides a variety of tenant services:
high quality, attractive space; promptly and fairly attending to tenant building
or billing concerns; obtaining the lowest possible utility, insurance and real
estate tax charges; and responding rapidly to expansion or space reconfiguration
requests.

         The Company's tenant service strategy benefits from the size and
concentration of the Company's real estate holdings in Greater Chicago. As a
large owner of warehouse/industrial properties in a single geographic market,
the Company believes it can obtain for its tenants the benefits of bulk purchase
of goods and services. Management believes that minimizing tenants' occupancy
costs builds tenant loyalty and provides the Company with a significant
marketing advantage.


                                       6
<PAGE>

         To motivate employees to provide the highest level of tenant service,
the Company has established a pay-for-performance compensation plan under which
the incentive pay of each participating employee depends in part on the results
of an annual tenant satisfaction survey, independently administered by CEL &
Associates and the Company's independent trustees. Employee incentive pay is
also dependent on the achievement of targeted per share funds from operations
and the results of a company-wide audit pertaining to the implementation of
internal processes and procedures, all of which the Company believes is enhanced
by tenant service.

         FOCUS ON VALUE-ADDED INVESTMENTS. The Company seeks to acquire
warehouse/industrial properties that have an initial cash yield greater than the
Company's long term cost of capital (currently estimated to be 9.5% to 10.5%),
that offer the best opportunity for cash flow growth, and that meet the
Company's investment criteria. Management has established strategies for
responding to every stage of the economic cycle, altering its investment
emphasis through the recovery, strong economy, and recession phases. This
ensures that when conditions change, the Company is well prepared to meet the
needs of its clients with minimal reaction time. All investment activities are
focused on creating value for its tenants by providing high quality and
efficient facilities at attractive rental rates

         -    RECOVERY --> ACQUISITIONS. During a recovering economy,
              CenterPoint acquires existing leased generic industrial buildings
              that are suitable for a wide variety of tenant uses.
              Traditionally, the seller is a company that is growing rapidly and
              can better invest its capital in its own business rather than in
              owning bricks and mortar. CenterPoint takes on that responsibility
              and enhances the facility through professional management.

         -    STRONG ECONOMY --> BUILD-TO-SUITS. During a strong economy,
              many tenants want to expand their space. As a result of the
              comfort level achieved through CenterPoint's long-term
              relationships with their tenants, as well as constant
              communication, the Company can ascertain the specific requirements
              of the tenant's future home. It can then be designed and built in
              the right location, on time, and within budget.

         -    RECESSION --> RE-DEVELOPMENTS. During a weaker economy,
              companies, on average, want to shrink capacity. Therefore,
              CenterPoint has developed a number of refinements within older,
              economically viable properties, completely rebuilding an existing
              facility within a tenant's time frame. By understanding their
              tenant's business needs, the Company can envision the potential of
              a building and match it to the market.

         In September 1998, the Company developed an Airport Properties division
to facilitate the expansion of its portfolio of air cargo facilities and other
area airport related investments. CenterPoint believes it is the pre-eminent
private sector provider, owner, and manager of airfreight and airport-related
facilities in the Chicago region.

         CenterPoint's land inventory consists of approximately 300 acres in
various submarkets throughout the Chicago Market upon which 5 million square
feet could be developed. In addition, 1,800 acres of land at the former Joliet
Arsenal is under contract. Currently, this project is undergoing extensive
economic, environmental and property due diligence, including a determination of
whether government agencies will provide the necessary infrastructure to support
the industrial development of the property.

         In addition to revenues from value-added investments, the Company earns
fees from the development of assets for purchase by tenants and institutions.
Typically, these transactions have yields


                                       7
<PAGE>

below the Company's investment return hurdle, but offer substantial profit
opportunities relative to the level of required capital and management time. The
Company believes it is afforded these opportunities as a consequence of the size
of its existing portfolio and its market penetration. The Company's fee
development business has been, and is expected to continue to be, a recurring
source of revenue.

         FOCUS ON OPERATIONS. The Company is a full service real estate company
with an entire staff responsible for managing its entire real estate portfolio.
Six regions, each serving a particular segment of Greater Chicago, are operated
by a team consisting of a regional manager, a property manager, administrative
assistant and accounting support personnel who are required to visit each
tenant, on site, at least once every 90 days.

         The Company believes it derives its competitive advantage from its
market penetration, local expertise, tenant relationships and quality reputation
with the Greater Chicago area. Another competitive advantage is its "state of
the art" information system which fully integrates corporate, property
management and accounting systems, enabling the Company to monitor and project
each asset and its financial performance. The Company believes this long-term
platform is capable of supporting its operating and financial objectives as well
as its continued strong growth.

         The Company's believes its dedication to efficient internal processes
and "back of the house" practices has resulted in significant improvement to
operating margins. As of December 31, 1998, Net Revenue margin increased to
88.7% from 88.1%; EBITDA margin increased to 64.5% from 62.4%; and Net Operating
Income ("NOI") margin increased to 65.8% from 63.9%.

         FOCUS ON CONSERVING CAPITAL. The Company seeks to create and maintain
substantial balance sheet capacity, which provides the Company flexibility to
opportunistically tap favorably priced capital to support accretive investments.
The Company believes it can maximize internal capital formation by (i) investing
at yields above its long term cost of capital; (ii) pursuing current and future
long-term debt financings and refinancings on an unsecured basis; and (iii)
redeploying its capital through asset sales. The Company will seek, where
possible, to sell properties in transactions intended to qualify as tax-free
exchanges under applicable provisions of the Internal Revenue Code and re-deploy
the proceeds of such sales in properties with higher yielding opportunities
where the Company believes significant value can be added.

         The Company targets a ratio of long-term debt to total market
capitalization of 25% to 40%, and a ratio of earnings before interest, taxes,
depreciation and amortization ("EBITDA") to debt service and fixed charges of
3.0 and 2.5 times or higher, respectively. For the year ended December 31, 1998,
the Company's ratio of EBITDA to debt service was 5.4 and the ratio of EBITDA to
fixed charges was 3.9.

TRANSACTIONS DURING 1998

         During 1998, the Company accomplished the following:

         1998 ACQUISITIONS AND DISPOSITIONS. During 1998, the Company acquired
or completed development of 32 warehouse/industrial properties totaling 4.0
million square feet and approximately $111.5 million in total investment. Also
in 1998, the Company disposed of 6 warehouse/industrial properties totaling
approximately 871,000 square feet for approximately $36.4 million. In addition,
during 1998 the Company sold approximately 32 acres of undeveloped land for
approximately $21.0 million.


                                       8
<PAGE>

         1998 SECURITIES ACTIVITIES:

         -    On March 25, 1998, the Company completed a public offering of
              370,371 common shares of beneficial interest at $32.0625 per share
              in an underwritten offering to a unit investment trust. Net
              proceeds from the offering after the underwriting discounts were
              approximately $11.8 million. The proceeds were used to repay a
              portion of amounts outstanding under the Company's line of credit
              co-led by The First National Bank of Chicago and Lehman Brothers
              Holdings Inc.

         -    On April 8, 1998 the Company completed a private placement to an
              institutional investor of 370,000 common shares of beneficial
              interest at $33.375 per share. The net proceeds of the offering of
              approximately $12.1 million were used to fund working capital
              requirements.

         -    In July, 1998, the Board of Trustees approved a shareholder
              protection plan (the "plan"), declaring a dividend of one right
              for each share of the Company's common shares outstanding on or
              after August 11, 1998. Exercisable 10 days after any person or
              group acquires 15 percent or more or commences a tender offer for
              15 percent or more of the Company's common shares, each right
              entitles the holder to purchase from the Company one
              one-thousandth of a Junior Preferred Share of Beneficial
              Interest, Series A (a "Rights Preferred Share"), at a price of
              $120, subject to adjustment. The Rights Preferred Shares (1) are
              non-redeemable, (2) are entitled to a minimum preferential
              quarterly dividend payment equal to the greater of $25 per share
              or 1,000 times the Company's common share dividend, (3) have a
              minimum liquidation preference equal to the greater of $100 per
              share or 1,000 times the liquidation payment made per common
              share and (4) are entitled to vote with the common shares with
              each Rights Preferred Share having 1,000 votes. 50,000 of the
              Company's authorized preferred shares have been designated for
              the Plan.

         1998 FINANCINGS. On April 5, 1998 the Company issued $100 million of
6.75% senior unsecured notes due April 1, 2005. The net proceeds of $99 million
were used to repay substantially all amounts outstanding under the Company's
line of credit co-led by The First National Bank of Chicago and Lehman Brothers
Holdings Inc. In November 1998, the Company increased its unsecured credit
facility to $250 million.

SUBSEQUENT TRANSACTIONS

         On March 15, 1999, the Company issued $100 million in senior unsecured
notes, due March 15, 2004 and bearing interest at 7.142%. The notes are co-lead
by Lehman Brothers Holdings, NationsBanc Montgomery Securities LLC, First
Chicago Capital Markets and First Union Capital Markets. The net proceeds of the
issuance of approximately $99.3 million were used to pay down the Company's line
of credit.

         Since December 31, 1998, 1,321,286 non-voting Class B Shares converted
to voting shares.


                                       9
<PAGE>

EMPLOYEES

         At February 12, 1999, the Company had 123 full-time and 25 part-time
employees. Of the full-time employees, 107 are involved with property
management, operations, leasing and acquisition activities, 8 are involved with
general financial administration, financing activities, reporting and
acquisition analysis, and 8 are clerical workers. Currently, the Company's
employees provide all property management activities. The Company does not
intend to enter into any agreement with any entity or person relating to such
services. However, the Company's Declaration of Trust does not contain any
prohibition on the use of third parties to perform such services, and such
services may therefore be performed by third parties in the future.

ENVIRONMENTAL MATTERS

         Under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended ("CERCLA"), as well as similar state and local
laws, owners and operators of property, both past and present, may be held
financially responsible for the investigation and, if appropriate, the
remediation of releases or threatened releases of hazardous substances into the
environment. Other parties who arranged for the disposal of hazardous substances
or transported hazardous substances for disposal at a property also may be held
liable. Liability under CERCLA and similar laws is strict, joint and several
unless a legally and factually sufficient basis for apportionment is
demonstrated and in most instances, liability may be imposed without regard to
the party's culpability concerning the presence of hazardous substances at the
property. Potentially responsible parties may be liable to one another, the
government and under some circumstances, third parties.

         To the extent the Company in the future may incur hazardous substance
response costs in connection with any of its properties, the Company may seek to
recover such costs from responsible parties under CERCLA. Costs recoverable
under CERCLA must be incurred in a manner consistent with the National
Contingency Plan. The National Contingency Plan establishes a procedure whereby
contaminated properties may be identified and, if necessary, remediated. If
conducted in the appropriate manner, the costs that may be recovered will
include but may not be limited to funds expended to investigate and to remediate
hazardous substance releases. Costs associated with any such environmental
activity may be substantial.

         All of the Company's existing properties have been, and all properties
the Company may acquire in the future will be, subjected to a Phase I and or
similar environmental assessments. The purpose of a Phase I environmental
assessment is to determine if past and present uses of a property indicate the
potential for soil or groundwater contamination or if other environmental
conditions might affect the value of or future uses of the property. Phase I
environmental assessments generally include the following: visual inspection of
environmental conditions at and around the property; review of available land
use records; interviews with the property representatives; examination of
information from environmental agencies; and a walk through survey for suspected
asbestos containing or other toxic materials.

         Apart from certain conditions currently being remedied, as described
below, the Phase I and Phase II environmental assessment reports have not
revealed any environmental condition affecting any of the Company's existing
properties or any properties under binding contract that the Company believes
requires remediation that would have a material adverse effect on the Company's
business or assets, nor is the Company aware of any such environmental
condition. The Company believes that either the properties are in compliance or
the remediation activities are in compliance in all material respects with
applicable Federal, state and local laws, ordinances and regulations concerning
the presence of hazardous substances. The


                                       10
<PAGE>

Company has not been notified by any governmental authority, and is not
otherwise aware, of any material noncompliance, liability or claim relating to
hazardous substances in connection with any of its properties. Based on its
current knowledge and currently applicable laws and regulations, the Company is
aware of the following environmental issues, none of which the Company believes
are material to its financial condition:

         1. Certain remediation activities are currently being conducted at
Great Lakes Industrial Center by Neo Industries, a previous tenant, which is
investigating chromium releases from its plating operations and is currently
remediating the chromium contamination in the soil and the groundwater. The
Company does not expect to incur any remediation costs with respect to this
property.

         2. The former owner/operator of one property, 1700 West Hawthorne Lane,
West Chicago, Illinois, has removed various underground and above-ground storage
tanks and performed remediation of releases from these tanks where necessary.
Closure reports have been or are being submitted by the former owner/operator
for each tank removal. The Company expects to receive Illinois Environmental
Protection Agency closure certification for each tank from the former
owner/operator in due course.

         3. Certain of the properties are in the vicinity of properties that
contain or have contained storage tanks or on which hazardous substances or
petroleum products have been or may in the future be used or stored. Based on
the Phase I and, in some cases, additional environmental assessments conducted
with respect to its properties, the Company is not aware that these conditions
have had, and believes it unlikely that these conditions will have, any adverse
effect on its properties. Should there be any adverse effect requiring response
by the Company, the Company believes that it may be able to recover its response
costs from the responsible parties.

         4. Limited quantities of asbestos containing materials ("ACM") are
present in various building materials at many of the Company's properties. The
ACM present at the properties generally is in good condition and for the most
part is non-friable. The Company has implemented an operation and maintenance
plan for ACM, including periodic inspections. This plan includes removal and
abatement activity whenever damaged ACM is discovered in areas where human
exposure may occur. It also includes an annual ACM abatement program and ACM
abatement during property renovation or reconstruction.

         It is possible, however, that the environmental assessments of the
Company's properties do not reveal all environmental liability concerns or that
there are material environmental liabilities of which the Company is unaware.
Given the nature of the properties that are now owned by the Company or that may
be acquired in the future, no assurances can be given that (i) future laws,
ordinances or regulations will not require or impose any material expenditures
or liabilities in connection with environmental conditions by or on the Company
or its properties; (ii) the current environmental condition of the Company's
properties will not be affected by tenants and occupants of such properties, by
the condition of properties in the vicinity of such properties or by third
parties unrelated to the Company; and (iii) prior owners of any of the Company's
properties did not create environmental problems of which the Company is not
aware.

COMPETITION

         All of the Company's existing properties are, and all of the properties
that it may acquire in the future are expected to be, located in areas that
include numerous other warehouse/industrial properties, many of which may be
deemed to be more suitable to a potential tenant than the Company's properties.
The resulting competition could have a material adverse effect on the Company's
ability to lease its properties and to increase the rentals charged on existing
leases.


                                       11
<PAGE>

INVESTMENT IN AND ADVANCES TO AFFILIATE

         The Company holds approximately 99% of the economic interest in
CenterPoint Realty Services Corporation, an Illinois corporation ("CRS"). To
maintain compliance with limitations on income from business activities received
by REITs and their qualified REIT subsidiaries, the Company holds its interest
in CRS in the form of non-voting equity ownership, which qualifies CRS as an
unconsolidated taxable subsidiary.

         As of December 31, 1998, the Company had advanced to CRS approximately
$41.4 million under a demand loan with interest rates ranging from 8% to 11.1%.
The proceeds of the loan were required for development projects. Principal and
interest are due upon demand.

ITEM 2.       PROPERTIES.

THE COMPANY'S WAREHOUSE/INDUSTRIAL PROPERTIES

         The Company's investment portfolio of warehouse/industrial properties
consists of 120 properties totaling approximately 23.6 million square feet.
During 1998, the Company acquired 30 fully-leased warehouse/industrial
properties, completed the construction of two fully leased warehouse/industrial
build-to-suit properties with a total area of approximately 4.0 million square
feet, disposed of six warehouse/industrial properties with a total area of
approximately 872,000 square feet. Also, a 910,800 thousand square foot
warehouse property was demolished with part of the land sold and the remaining
land retained for development of a build-to-suit.

         LOCATION. The Company's current properties are well located, with
convenient access to area interstate highway, rail, and air transportation. The
properties are in good physical condition, most of them having been built or
substantially renovated within the last 10 years.

         BUILDING CHARACTERISTICS. Most of the space in the warehouse/industrial
properties currently owned by the Company or under contract has been designed
for warehousing and distribution. The remainder of the space is comprised of
light manufacturing space. A number of the industrial properties include both
distribution and light manufacturing space so as to provide tenants with
increased flexibility. The Company's largest industrial property contains
approximately 1,700,000 rentable square feet in a multi-tenant warehousing and
manufacturing property, available for redevelopment into a multi-tenant
warehouse/industrial complex. The Company's present warehouse/industrial
properties have an average project size of 196,959 square feet, and, on average,
a tenant at an industrial property occupies 112,015 rentable square feet.
Although a number of the industrial properties are single-tenant build-to-suit
facilities, all are designed to be divisible and to be leased by multiple
tenants. The Company has had substantial experience in subdividing older space
for new tenants.

         The Company's present warehousing and distribution properties, as well
as warehousing and distribution properties under contract, are designed for bulk
storage of materials and manufactured goods in buildings with interior heights
typically of 22 feet or more. All of the warehousing and distribution properties
have dock facilities for trucks as well as grade level loading for lighter
vehicles and vans. Typically, the distribution buildings are used for storage
and contain a minimal amount of office space.


                                       12
<PAGE>

         LEASE CHARACTERISTICS. The Company believes that the lease agreements
for its warehouse/industrial properties, which in most cases provide for
scheduled or indexed increases in rent, as well as the strengthening economy,
will provide opportunities for rental growth. The Company, in substantially all
cases, passes operating expenses and real estate tax increases on to tenants.
The leases for the warehouse/industrial properties currently owned by the
Company have terms between one and 15 years, with a weighted average remaining
term, based on square footage, of approximately 4.0 years as of December 31,
1998.

         TENANT DIVERSITY. The composition of tenants in the
warehouse/industrial properties currently owned by the Company reflects the
commercial diversity of businesses operating in Greater Chicago. At December 31,
1998 no single industry, other than Wholesale Trade-Durable Goods and
Trucking/Warehousing, accounted for more than 5.8% of the leased space in the
warehouse/industrial properties currently owned by the Company. Wholesale
Trade-Durable Goods and Trucking/Warehousing, which encompasses a wide variety
of industries, accounted for 25.9% of the leased space in the
warehouse/industrial properties currently owned by the Company at December 31,
1998, and the six largest industries, other than Wholesale Trade-Durable Goods
and Trucking/Warehousing, represented by tenants accounted collectively for only
30.8% of such space. In addition, rent from no single tenant comprised more than
3% of the Company's total revenues as of December 31, 1998.

         OTHER INFORMATION REGARDING WAREHOUSE/INDUSTRIAL PROPERTIES. The
following table sets forth certain information regarding the Company's portfolio
of warehouse/industrial properties, separately identifying 1998 investments of
the Company:


                                       13

<PAGE>

                          CENTERPOINT PROPERTIES TRUST
                                PROPERTY SUMMARY
                             AS OF DECEMBER 31, 1998

<TABLE>
<CAPTION>
                                                                    YEAR OF ORIGINAL
                                                                    CONSTRUCTION/LAST       ANNUALIZED     AVERAGE
                                                                      REDEVELOPMENT          BASE RENT     RENT PER       GLA
        PROPERTY ADDRESS                  CITY         STATE      AND/OR EXPANSION (1)       REVENUES     SQ. FT. (2) SQ. FT. (3)
        ----------------                  ----         -----      --------------------       --------     ----------- -----------

        1998 INVESTMENTS
        ----------------
<S>                               <C>                  <C>        <C>                       <C>           <C>         <C>
LAKE COUNTY
28160 N. Keith                    Lake Forest            IL                1989                  $307,800       $3.95       77,924
28618 N. Ballard                  Lake Forest            IL                1984                   284,755        4.77       59,688
28167 N Keith                     Lake Forest            IL                1986                   177,066        6.79       26,082

N. KANE COUNTY
1575 Executive Drive              Elgin                  IL                1980                   156,804        5.05       31,050
1925 Holmes Rd. (6)               Elgin                  IL                1989                   503,622        4.28      117,600

CHICAGO O'HARE AREA
2121 Touhy Avenue (7)             Elk Grove              IL                1962                   450,100        3.50      128,600
2021 Lunt Avenue (7)              Elk Grove              IL                1972                   243,084        3.80       64,000
2001 S. Mt. Prospect Road (7)     Des Plaines            IL                1980                   566,810        3.41      166,220
755 Dillon Drive                  Wood Dale              IL                1986                   317,280        6.62       47,928
201 Oakton                        Des Plaines            IL                1984                   719,196        4.49      160,102
543 W. Algonquin Rd. (6)          Arlington Heights      IL                1970                   167,629        4.90       34,210

CITY NORTH
860 W. Evergreen                  Chicago                IL             1890/1995                 648,204        4.63      140,000
5730 North Tripp (6)              Chicago                IL                1975                   405,264        3.48      116,584
1381 N. Northbranch (6)           Chicago                IL                1900                   117,000        3.34       35,000

NEAR WEST SUBURBS
3601 N. Runge                     Franklin Park          IL             1962/1968                 412,407        3.61      114,266
3400 N. Powell                    Franklin Park          IL             1961/1980                 415,260        3.61      115,097
11100 W. Addison                  Franklin Park          IL                1967                   189,636        5.20       36,469
11140 W. Addison                  Franklin Park          IL             1961/1965                 345,330        3.09      111,588
3434 N. Powell                    Franklin Park          IL             1960/1966                 327,000        3.60       90,760
1999 N. Ruby                      Melrose Park           IL             1952/1962                 213,906        1.98      107,852
11550 W. King                     Franklin Park          IL                1963                   192,252        2.80       68,663
200 Champion Drive                Northlake              IL                1998                   665,640        4.02      165,612

<CAPTION>
                                             PERCENT
                                              OF GLA
                                   PERCENT    LEASED
                                   OF TOTAL    AS OF    NO. OF    PROPERTY
        PROPERTY ADDRESS           GLA (4)   12/31/98   TENANTS   TYPE(5)
        ----------------          ---------  --------   -------   -------

        1998 INVESTMENTS
        ----------------
<S>                               <C>        <C>        <C>       <C>
LAKE COUNTY
28160 N. Keith                         0.33%      100%     1        ACQ
28618 N. Ballard                       0.25%      100%     1        ACQ
28167 N Keith                          0.11%      100%     1        ACQ

N. KANE COUNTY
1575 Executive Drive                   0.13%      100%     1        ACQ
1925 Holmes Rd. (6)                    0.49%      100%     1        ACQ

CHICAGO O'HARE AREA
2121 Touhy Avenue (7)                  0.53%      100%     1        ACQ
2021 Lunt Avenue (7)                   0.27%      100%     1        ACQ
2001 S. Mt. Prospect Road (7)          0.68%      100%     1        ACQ
755 Dillon Drive                       0.20%      100%     1        ACQ
201 Oakton                             0.66%       75%     2        ACQ
543 W. Algonquin Rd. (6)               0.14%      100%     1        ACQ

CITY NORTH
860 W. Evergreen                       0.58%      100%     1        ACQ
5730 North Tripp (6)                   0.48%      100%     1        ACQ
1381 N. Northbranch (6)                0.15%      100%     1        ACQ

NEAR WEST SUBURBS
3601 N. Runge                          0.47%      100%     1        ACQ
3400 N. Powell                         0.47%      100%     1        ACQ
11100 W. Addison                       0.15%      100%     1        ACQ
11140 W. Addison                       0.46%      100%     1        ACQ
3434 N. Powell                         0.38%      100%     1        ACQ
1999 N. Ruby                           0.44%      100%     1        ACQ
11550 W. King                          0.29%      100%     1        ACQ
200 Champion Drive                     0.68%      100%     1        BTS



                                       14
<PAGE>

<CAPTION>

                                                                   YEAR OF ORIGINAL
                                                                  CONSTRUCTION/LAST       ANNUALIZED     AVERAGE
                                                                    REDEVELOPMENT          BASE RENT     RENT PER       GLA
        PROPERTY ADDRESS                  CITY       STATE       AND/OR EXPANSION (1)      REVENUES     SQ. FT. (2) SQ. FT. (3)
        ----------------                  ----       -----       --------------------      --------     ----------- -----------

<S>                               <C>                <C>         <C>                      <C>           <C>         <C>
CENTRAL KANE/N. DUPAGE
1030 Fabyan Parkway               Batavia            IL                 1978                   $684,700       $3.22      212,728

SOUTHWEST SUBURBS
7633 S. Sayre                     Bedford Park       IL                 1968                     91,200        6.50       14,039
7201 S. Lemington                 Bedford Park       IL                 1958                    360,000        3.37      106,800
7200 S. Mason                     Bedford Park       IL                 1974                    606,420        2.92      207,345
6000 W. 73rd                      Bedford Park       IL                 1974                    397,391        2.68      148,091

SOUTH SUBURBS
2601 Bond Street                  University Park    IL                 1975                    224,000        3.50       64,000
11801 S. Central                  Alsip              IL                 1985                    853,158        3.00      284,386

MILWAUKEE COUNTY
4700 Ironwood Drive               Franklin           WI                 1998                    412,720        3.35      123,200
5521 Mill Road                    Milwaukee          WI                 1960                    103,700        2.33       44,435

DOWNSTATE ILLINOIS
Dial, Build-to-Suit               Granite City       IL                 1998                  2,120,016        2.61      812,000
                                                                                                                       ---------
SUBTOTAL                                                                                    $13,575,650                4,032,319
                                                                                            -----------                ---------
AVERAGE                                                                                                       $3.37      126,010
                                                                                                              -----    ---------

   PREVIOUSLY OWNED PROPERTIES
   ---------------------------

LAKE COUNTY
3145 Central Avenue(6)            Waukegan           IL                 1958                    788,500        2.63      300,000
1810-1820 Industrial Drive        Libertyville       IL                 1977                    267,756        3.15       85,000
1 Wildlife Way                    Long Grove         IL                 1994                    684,852       12.66       54,100
620-630 Butterfield Road          Mundelein          IL                 1990                    254,484       10.50       24,237
1700 Butterfield Road             Mundelein          IL                 1976                    232,500        3.88       60,000
950-970 Tower Road                Mundelein          IL               1979/1990                 154,805        4.04       38,359
2339-41 Ernie Krueger Court       Waukegan           IL               1990/1993                 219,615        4.03       54,450
1300 Northpoint Road              Waukegan           IL                 1994                    338,351        5.21       65,000



<CAPTION>

                                              PERCENT
                                              OF GLA
                                   PERCENT    LEASED AS
                                    OF TOTAL      OF      NO. OF   PROPERTY
        PROPERTY ADDRESS            GLA (4)    12/31/98   TENANTS  TYPE(5)
        ----------------            --------   --------   -------  ------
<S>                               <S>         <C>         <C>      <C>
CENTRAL KANE/N. DUPAGE
1030 Fabyan Parkway                     0.87%       100%         1   ACQ

SOUTHWEST SUBURBS
7633 S. Sayre                           0.06%       100%         1   ACQ
7201 S. Lemington                       0.44%       100%         1   ACQ
7200 S. Mason                           0.85%       100%         1   ACQ
6000 W. 73rd                            0.61%       100%         2   ACQ

SOUTH SUBURBS
2601 Bond Street                        0.27%       100%         1   ACQ
11801 S. Central                        1.17%       100%         1   ACQ

MILWAUKEE COUNTY
4700 Ironwood Drive                     0.51%       100%         1   BTS
5521 Mill Road                          0.19%       100%         1   ACQ

DOWNSTATE ILLINOIS
Dial, Build-to-Suit                      3.33       100%         1   BTS
                                       ------       ----
SUBTOTAL                               16.64%
                                       ------
AVERAGE                                 0.52%
                                       ------

   PREVIOUSLY OWNED PROPERTIES
   ---------------------------

LAKE COUNTY
3145 Central Avenue(6)                  1.23%       100%         2   ACQ
1810-1820 Industrial Drive              0.35%       100%         1   ACQ
1 Wildlife Way                          0.23%       100%         1   RDV
620-630 Butterfield Road                0.10%         0%         0   BTS
1700 Butterfield Road                   0.25%       100%         1   ACQ
950-970 Tower Road                      0.16%       100%         3   BTS
2339-41 Ernie Krueger Court             0.23%       100%         1   BTS
1300 Northpoint Road                    0.28%       100%         1   ACQ


                                       15
<PAGE>

<CAPTION>
                                                                     YEAR OF ORIGINAL
                                                                    CONSTRUCTION/LAST      ANNUALIZED       AVERAGE
                                                                      REDEVELOPMENT         BASE RENT       RENT PER        GLA
        PROPERTY ADDRESS                  CITY         STATE       AND/OR EXPANSION (1)     REVENUES       SQ. FT. (2)  SQ. FT. (3)
         ----------------                  ----         -----       --------------------     --------       -----------  -----------

<S>                               <C>                  <C>         <C>                     <C>             <C>          <C>
N.W. COOK COUNTY
1500 West Dundee Road (6)         Arlington Heights    IL                  1969               $2,107,009       $4.21      500,000
900 W. University Drive           Arlington Heights    IL                  1974                  586,000        6.79       86,254

N. KANE COUNTY
825 Tollgate Road                 Elgin                IL                  1989                  389,490        4.69       83,122

CHICAGO O'HARE AREA
O'Hare Express-Phase A-2          Chicago              IL                  1997                1,080,616        8.93      120,971
O'Hare Express-Phase B-1          Chicago              IL                  1997                2,125,388       12.38      171,685
110-190 Old Higgins Road          Des Plaines          IL                  1980                1,246,757       10.36      120,292
1796 Sherwin                      Des Plaines          IL                  1964                  617,252        6.48       95,220
2525 Busse Road                   Elk Grove Village    IL                  1975                3,314,136        3.73      888,335
2701-2781 Busse Road              Elk Grove Village    IL                  1997                1,222,932        4.87      251,076
2801-2881 Busse Road              Elk Grove Village    IL                  1997                1,112,802        4.43      251,076
1951 Landmeier                    Elk Grove Village    IL                  1967                  237,384        5.66       41,976
745 Birginal Road                 Bensenville          IL                  1974                  505,166        4.46      113,266
2743 Armstrong Court              Des Plaines          IL                  1989                  300,843        5.64       53,325
850 Arthur Avenue (8)             Elk Grove Village    IL               1971/1973                181,941        4.28       42,490
1400 Busse Road                   Elk Grove Village    IL                  1975                  442,421        2.98      148,436
1100 Chase Avenue (7)             Elk Grove Village    IL               1980/1996                150,778        3.62       41,651
2600 Elmhurst Road                Elk Grove Village    IL                  1995                  531,917        5.07      105,000
875 Fargo Avenue                  Elk Grove Village    IL                  1980                  424,596        5.15       82,368
1850 Greenleaf                    Elk Grove Village    IL                  1965                  255,024        4.35       58,627
1201 Lunt Avenue                  Elk Grove Village    IL                  1971                   45,118        6.11        7,380
1501 Pratt Avenue                 Elk Grove Village    IL                  1973                  589,132        3.88      151,900
1520 Pratt Avenue                 Elk Grove Village    IL                  1968                  243,551        3.89       62,546
10601 Seymour Avenue (6)          Franklin Park        IL               1963/1970              2,755,299        4.07      677,000

2553 North Edgington              Franklin Park        IL               1967/1995              1,176,222        4.29      274,303
10740 West Grand Avenue (7)       Franklin Park        IL               1965/1971                189,052        2.86       66,000
1800 Bruning Drive                Itasca               IL               1975/1978              1,169,203        5.79      202,000
245 Beinoris Drive                Wood Dale            IL               1988/1993                 93,741        7.82       11,989

4501 West Augusta Boulevard       Chicago              IL               1942/1989                792,975        1.83      432,661

<CAPTION>
                                              PERCENT
                                              OF GLA
                                  PERCENT    LEASED AS
                                  OF TOTAL       OF      NO. OF   PROPERTY
        PROPERTY ADDRESS           GLA (4)    12/31/98   TENANTS  TYPE(5)
         ----------------         --------   ---------   -------  --------

<S>                               <C>        <C>         <C>      <C>
N.W. COOK COUNTY
1500 West Dundee Road (6)              2.05%        49%         2   ACQ
900 W. University Drive                0.36%       100%         1   ACQ

N. KANE COUNTY
825 Tollgate Road                      0.34%       100%         2   ACQ

CHICAGO O'HARE AREA
O'Hare Express-Phase A-2               0.50%       100%         2   BTS
O'Hare Express-Phase B-1               0.71%       100%         1   BTS
110-190 Old Higgins Road               0.50%        99%         7   ACQ
1796 Sherwin                           0.39%       100%         2   ACQ
2525 Busse Road                        3.64%        85%         9   ACQ
2701-2781 Busse Road                   1.03%       100%         2   BTS
2801-2881 Busse Road                   1.03%       100%         2   BTS
1951 Landmeier                         0.18%       100%         2   ACQ
745 Birginal Road                      0.47%       100%         1   ACQ
2743 Armstrong Court                   0.23%       100%         1   BTS
850 Arthur Avenue (8)                  0.18%       100%         1   ACQ
1400 Busse Road                        0.61%        39%        12   ACQ
1100 Chase Avenue (7)                  0.18%       100%         1   ACQ
2600 Elmhurst Road                     0.43%       100%         1   BTS
875 Fargo Avenue                       0.34%       100%         1   ACQ
1850 Greenleaf                         0.25%       100%         1   ACQ
1201 Lunt Avenue                       0.03%       100%         1   ACQ
1501 Pratt Avenue                      0.63%       100%         2   ACQ
1520 Pratt Avenue                      0.26%       100%         1   ACQ
10601 Seymour Avenue (6)               2.77%        74%         2   ACQ/
                                                                    RDV
2553 North Edgington                   1.13%       100%         4   ACQ
10740 West Grand Avenue (7)            0.28%       100%         1   ACQ
1800 Bruning Drive                     0.83%       100%         1   ACQ
245 Beinoris Drive                     0.05%       100%         1   BTS/
                                                                    RDV
4501 West Augusta Boulevard            1.77%        97%         8   RDV


                                       16
<PAGE>

<CAPTION>

                                                                     YEAR OF ORIGINAL
                                                                    CONSTRUCTION/LAST      ANNUALIZED     AVERAGE
                                                                      REDEVELOPMENT         BASE RENT     RENT PER       GLA
        PROPERTY ADDRESS                  CITY         STATE       AND/OR EXPANSION (1)     REVENUES     SQ. FT. (2) SQ. FT. (3)
        ----------------                  ----         -----       --------------------     --------     ----------- -----------

<S>                               <C>                  <C>         <C>                     <C>           <C>         <C>
N.W. SUBURBS
400 North Wolf Road               Northlake            IL               1956/1997             $5,128,034       $3.36    1,527,593

CENTRAL KANE/N. DUPAGE
425 South 37th Avenue (7)         St. Charles          IL                  1975                  393,581        3.82      103,106
1250 Carolina Drive               West Chicago         IL                  1988                  514,500        3.43      150,000
1645 Downs Drive                  West Chicago         IL                  1975                  414,048        3.20      129,390
1733 Downs Drive                  West Chicago         IL                  1975                  363,816        2.50      145,528
825-845 Hawthorne Lane (6)        West Chicago         IL                  1974                  527,700        3.32      158,772
1700 West Hawthorne (6)           West Chicago         IL               1959/1969              1,381,800        1.88      735,196

WEST SUBURBS
2901 Centre Circle (7)            Downers Grove        IL                  1979                  153,238        7.28       21,056

FAR WEST SUBURBS
1 Allsteel Drive (7)              Aurora               IL                  1960                2,387,565        2.37    1,008,120
2727 West Diehl Road              Naperville           IL                  1997                2,047,896        4.65      440,343
2885 West Diehl Road              Naperville           IL                  1997                1,145,928        3.80      301,560

SOUTHWEST SUBURBS
7447 South Central Avenue         Bedford Park         IL                  1975                  283,723        2.40      118,218
7400 S. Narragansett Ave (6)      Bedford Park         IL                  1976                  515,424        2.95      174,720
6751-55 South Sayre Avenue        Bedford Park         IL                  1974                  695,352        2.87      242,690
7525 South Sayre                  Bedford Park         IL                  1981                  411,261        3.34      123,178
6464 West 51st Street             Forest View          IL                  1973                  730,326        3.50      208,713
6500 West 51st Street             Forest View          IL                  1975                  500,292        2.70      185,295
9301 W. 55th Street (6)           McCook               IL                  1979                1,620,000        0.95    1,700,000

<CAPTION>


                                              PERCENT
                                              OF GLA
                                    PERCENT  LEASED AS
                                   OF TOTAL      OF      NO. OF   PROPERTY
        PROPERTY ADDRESS           GLA (4)    12/31/98   TENANTS  TYPE(5)
        ----------------          --------   ---------   -------  --------

<S>                               <C>        <C>         <C>      <C>
N.W. SUBURBS
400 North Wolf Road                    6.25%       100%         4   ACQ

CENTRAL KANE/N. DUPAGE
425 South 37th Avenue (7)              0.43%       100%         1   ACQ
1250 Carolina Drive                    0.62%       100%         1   BTS
1645 Downs Drive                       0.53%       100%         1   ACQ
1733 Downs Drive                       0.60%       100%         1   ACQ
825-845 Hawthorne Lane (6)             0.65%        83%         5   ACQ
1700 West Hawthorne (6)                3.01%       100%         1   ACQ

WEST SUBURBS
2901 Centre Circle (7)                 0.09%       100%         1   ACQ

FAR WEST SUBURBS
1 Allsteel Drive (7)                   4.13%        99%         3   ACQ
2727 West Diehl Road                   1.81%       100%         1   BTS
2885 West Diehl Road                   1.24%       100%         1   BTS

SOUTHWEST SUBURBS
7447 South Central Avenue              0.49%       100%         1   ACQ
7400 S. Narragansett Ave (6)           0.72%       100%         1   ACQ
6751-55 South Sayre Avenue             1.00%       100%         2   ACQ
7525 South Sayre                       0.51%        63%         2   ACQ
6464 West 51st Street                  0.86%       100%         4   ACQ
6500 West 51st Street                  0.76%       100%         1   ACQ
9301 W. 55th Street (6)                6.96%       100%         1   RDV


                                       17
<PAGE>

<CAPTION>

                                                                     YEAR OF ORIGINAL
                                                                    CONSTRUCTION/LAST     ANNUALIZED     AVERAGE
                                                                      REDEVELOPMENT        BASE RENT     RENT PER       GLA
        PROPERTY ADDRESS                  CITY         STATE       AND/OR EXPANSION (1)    REVENUES     SQ. FT. (2) SQ. FT. (3)
        ----------------                  ----         -----       --------------------    --------     ----------- -----------

<S>                               <C>                  <C>         <C>                     <C>          <C>         <C>

800 Enterprise Court              Naperville           IL                 1985                 $183,660       $5.25       34,984
720 Frontenac                     Naperville           IL                 1991                  524,308        3.05      171,935
820 Frontenac                     Naperville           IL                 1988                  500,045        3.26      153,604
920 Frontenac                     Naperville           IL                 1987                  413,900        3.42      121,200
1020 Frontenac                    Naperville           IL                 1980                  441,750        4.43       99,684
1120 Frontenac                    Naperville           IL               1980/1994               578,915        3.76      153,902
1510 Frontenac                    Naperville           IL                 1986                  359,287        3.43      104,886
1560 Frontenac                    Naperville           IL                 1987                  305,278        3.57       85,608
1651 Frontenac                    Naperville           IL                 1978                  123,139        4.05       30,414
2764 Golfview                     Naperville           IL                 1985                  102,284        5.11       20,022
1500 Shore Drive                  Naperville           IL                 1985                  144,150        3.33       43,230
1150 Shore Road                   Naperville           IL                 1985                  126,773        4.20       30,184
2301 North Route 30               Plainfield           IL                 1972                  777,367        2.75      282,679
1355 Enterprise Drive (6)         Romeoville           IL                 1980                  341,880        2.80      122,100

SOUTHWEST SUBURBS
6600 River Road                   Hodgkins             IL                 1968                1,438,178        2.28      630,410

FAR S.W. SUBURBS
16400 West 103rd Street (7)       Lemont               IL               1983/1995               299,616        4.71       63,612
1319 Marquette Drive              Romeoville           IL                 1990                  218,094        6.00       36,349
7001 Adams Street                 Willowbrook          IL                 1994                  192,720        7.61       25,324

CHICAGO SOUTH
3133 East 106th (6)               Chicago              IL                 1971                  300,285        3.75       80,076
4400 South Kolmar (6)             Chicago              IL                 1966                  290,182        3.15       92,000
900 East 103rd Street             Chicago              IL               1910/1990             1,853,141        3.22      575,462


<CAPTION>
                                              PERCENT
                                               OF GLA
                                   PERCENT    LEASED AS
                                   OF TOTAL      OF      NO. OF   PROPERTY
        PROPERTY ADDRESS           GLA (4)    12/31/98   TENANTS  TYPE(5)
        ----------------          --------   ---------   -------  --------
<S>                               <C>        <C>         <C>      <C>
800 Enterprise Court                   0.15%       100%         1   ACQ
720 Frontenac                          0.71%       100%         2   ACQ
820 Frontenac                          0.63%       100%         1   ACQ
920 Frontenac                          0.50%       100%         1   ACQ
1020 Frontenac                         0.41%       100%         1   ACQ
1120 Frontenac                         0.63%       100%         1   ACQ
1510 Frontenac                         0.43%       100%         1   ACQ
1560 Frontenac                         0.36%       100%         2   ACQ
1651 Frontenac                         0.13%       100%         1   ACQ
2764 Golfview                          0.08%       100%         1   ACQ
1500 Shore Drive                       0.18%       100%         2   ACQ
1150 Shore Road                        0.13%       100%         1   ACQ
2301 North Route 30                    1.16%       100%         1   ACQ
1355 Enterprise Drive (6)              0.50%        25%         1   ACQ

SOUTHWEST SUBURBS
6600 River Road                        2.58%       100%         1   ACQ

FAR S.W. SUBURBS
16400 West 103rd Street (7)            0.27%       100%         1   ACQ
1319 Marquette Drive                   0.15%         0%         0   BTS
7001 Adams Street                      0.11%       100%         1   BTS

CHICAGO SOUTH
3133 East 106th (6)                    0.33%       100%         1   ACQ
4400 South Kolmar (6)                  0.38%       100%         1   ACQ
900 East 103rd Street                  2.36%        24%         1   RDV


                                       18
<PAGE>

<CAPTION>

                                                                     YEAR OF ORIGINAL
                                                                    CONSTRUCTION/LAST      ANNUALIZED     AVERAGE
                                                                      REDEVELOPMENT         BASE RENT     RENT PER       GLA
        PROPERTY ADDRESS                  CITY         STATE       AND/OR EXPANSION (1)     REVENUES     SQ. FT. (2) SQ. FT. (3)
        ----------------                  ----         -----       --------------------     --------     ----------- ------------

<S>                               <C>                  <C>         <C>                     <C>           <C>         <C>
11701 South Central Avenue        Alsip                IL                 1970                  $951,136       $3.20      297,207
5619-25 West 115th Street         Alsip                IL                 1974                 1,805,830        4.55      396,979
21399 Torrence Avenue             Sauk Village         IL                 1987                   745,164        2.00      372,835

N.W. INDIANA
425 West 151st Street             East Chicago         IN               1913/1991              1,310,418        3.75      349,236
201 Mississippi Street            Gary                 IN               1945/1988              3,782,586        3.60    1,052,173
1827 North Bendix Drive (6)       South Bend           IN               1964/1990                583,212        2.92      199,730

MILWAUKEE COUNTY
7501 North 81st Street            Milwaukee            WI                 1987                   576,000        3.13      183,958
1475 S. 101st                     West Allis           WI                 1969                   194,013        4.13       46,973
2003-2201 S. 114th Street         West Allis           WI                 1965                   642,540        2.64      243,350

KENOSHA COUNTY
8200 100th Street                 Pleasant Prairie     WI                 1990                   568,361        3.83      148,472
8901 102nd Street                 Pleasant Prairie     WI                 1990                   649,532        6.15      105,637


RACINE COUNTY
1333 Grandview Drive              Yorkville            WI                   .                    796,572        3.79      210,000

SUBTOTAL                                                                                     $70,631,809               20,414,752
                                                                                                                       ----------
AVERAGE                                                                                                        $3.46      229,379
                                                                                                                       ----------
GRAND TOTAL ALL WAREHOUSE/
  INDUSTRIAL PROPERTIES                                                                      $84,207,459               24,447,071
                                                                                                                       ----------
AVERAGE ALL WAREHOUSE/
  INDUSTRIAL PROPERTIES (9)                                                                                    $3.44      202,042
                                                                                                                       ----------
GRAND TOTAL ALL WAREHOUSE/
  INDUSTRIAL PROPERTIES
  EXCLUDING REDEVELOPMENTS
  AT 12/31/98                                                                                $84,207,459               23,871,609
AVERAGE ALL WAREHOUSE/
  INDUSTRIAL PROPERTIES
  EXCLUDING REDEVELOPMENTS
  AT 12/31/98 (9)                                                                                              $3.56      168,568
                                                                                                                       ----------
<CAPTION>
                                               PERCENT
                                                OF GLA
                                     PERCENT   LEASED AS
                                    OF TOTAL      OF      NO. OF   PROPERTY
        PROPERTY ADDRESS            GLA (4)    12/31/98   TENANTS   TYPE(5)
        ----------------            -------   ---------   -------  --------
<S>                                 <C>       <C>         <C>      <C>
11701 South Central Avenue              1.22%       100%         1    ACQ
5619-25 West 115th Street               1.63%       100%         4    RDV
21399 Torrence Avenue                   1.53%       100%         1    ACQ

N.W. INDIANA
425 West 151st Street                   1.43%        96%         9    RDV
201 Mississippi Street                  4.31%        95%        14    RDV
1827 North Bendix Drive (6)             0.82%       100%         1    ACQ

MILWAUKEE COUNTY
7501 North 81st Street                  0.76%       100%         1    ACQ
1475 S. 101st                           0.20%       100%         1    ACQ
2003-2201 S. 114th Street               1.00%       100%         2    ACQ

KENOSHA COUNTY
8200 100th Street                       0.61%       100%         1    ACQ
8901 102nd Street                       0.44%       100%         1    ACQ


RACINE COUNTY
1333 Grandview Drive                    0.86%       100%         1    ACQ

SUBTOTAL                               83.36%
AVERAGE                                 0.94%


GRAND TOTAL ALL WAREHOUSE/
  INDUSTRIAL PROPERTIES               100.00%                 211
AVERAGE ALL WAREHOUSE/
  INDUSTRIAL PROPERTIES (9)                          95%

GRAND TOTAL ALL WAREHOUSE/
  INDUSTRIAL PROPERTIES
  EXCLUDING REDEVELOPMENTS
  AT 12/31/98                                        96%
AVERAGE ALL WAREHOUSE/
  INDUSTRIAL PROPERTIES
  EXCLUDING REDEVELOPMENTS
  AT 12/31/98 (9)
</TABLE>

                                              19
<PAGE>


--------------------

(1)      First date of original construction; second date is year of last
         redevelopment and/or expansion. If only one date appears, it is the
         acquisition date; the property has not been redeveloped or expanded.
(2)      Determined by dividing annualized base rent revenue by GLA.
(3)      "GLA" means gross leasable area.
(4)      Determined as a percent of the total GLA for the warehouse/industrial
         properties.
(5)      ACQ refers to an existing leased property acquired by the Company, BTS
         refers to a build-to-suit property and RDV refers to a redevelopment
         property. One of the redevelopment properties, 900 East 103rd Street,
         Chicago Illinois, has been taken out of operations as of December 31,
         1998 to complete rehab construction.
(6)      Properties purchased through a sale-leaseback to the previous owner
         have no operating history relevant to third party usage.
(7)      Properties purchased from an owner occupant have no prior operating
         history relevant to third party usage.
(8)      The seller of this property holds a note payable by the Company in the
         principal amount of $575,000 and secured by this property.
(9)      Average size equals total GLA divided by the number of
         warehouse/industrial properties.

LEASE EXPIRATIONS

         The following table shows as of December 31, 1998 scheduled lease
expirations for the Company's warehouse/industrial properties commencing January
1, 1999 and for the next ten years, assuming that no tenants exercise renewal
options:

<TABLE>
<CAPTION>
                                                                       AVERAGE    % OF TOTAL
                                                                      BASE RENT   PROPERTIES    % OF 1998
                                            GLA OF     ANNUALIZED    PER SQ. FT.      GLA       BASE RENT
                               NO. OF      EXPIRING     BASE RENT       UNDER     REPRESENTED  REPRESENTED
                               LEASES       LEASES      EXPIRING      EXPIRING    BY EXPIRING  BY EXPIRING
                              EXPIRING    (SQ. FT.)      LEASES        LEASES       LEASES       LEASES
                              --------    ---------      ------        ------       ------       ------
YEAR ENDING DECEMBER 31

<S>                              <C>     <C>           <C>              <C>         <C>          <C>
1999 ......................      51      3,966,037     $12,402,962      $3.13       19.14%       16.02%
2000 ......................      45      2,668,046       9,203,895       3.45       12.88%       11.89%
2001 ......................      21      1,563,859       6,132,702       3.92        7.55%        7.92%
2002 ......................      28      3,432,979      10,088,978       2.94       16.57%       13.03%
2003 ......................      25        2171065         8283914       3.82       10.48%       10.7%
2004 ......................      10      1,650,214       6,054,731       3.67        7.97%        7.82%
2005 ......................      11      1,526,940       4,716,660       3.09        7.37%        6.09%
2006 ......................       9      1,604,063       5,451,730       3.40        7.74%        7.04%
2007 ......................       7        704,764       4,687,687       6.65        3.4%         6.06%
2008 ......................       8      1,429,729       6,684,065       4.68        6.9%         8.63%
</TABLE>


OPTIONS TO PURCHASE GRANTED TO CERTAIN TENANTS

     The following warehouse/industrial properties of the Company are subject to
purchase options granted to certain tenants as follows:

     -   A purchase option which was outstanding at December 31, 1998 for One
         Wildlife Way, Long Grove, Illinois expired as of February 1, 1999.


                                     20
<PAGE>


         -    8901 102nd Street, Pleasant Prairie, Wisconsin is subject to an
              option to purchase exercisable on February 28, 2006 at a purchase
              price equal to 95% of "fair market value," determined by the
              average of three independent appraisals.

         -    1700 West Hawthorne, West Chicago, Illinois is subject to a
              purchase option exercisable between December 1, 2002, and December
              1, 2003 (with the closing to occur during December, 2004
              regardless of when the option is exercised) at a price of
              $15,033,636. If the property is expanded, at tenant's option, the
              purchase price will be $15,233,636, plus the cost of construction.

         -    2600 Elmhurst Road, Elk Grove Village, Illinois is subject to an
              option exercisable on or before July 31, 2000 to purchase the
              premises during January of 2001 for a purchase price of
              $5,265,000.

         -    21399 Torrence Avenue, Sauk Village, Illinois is subject to an
              option exercisable on or between December 1, 1998 and May 31, 2000
              and again between December 31, 2000 and May 31, 2002 to purchase
              the property on November 30, 2000 for $8,941,920 or November 30,
              2002 for $9,314,500.

         -    11440 W. Addison, Franklin Park, Illinois is subject to a purchase
              option any time after May 1, 1999, but not later than June 30,
              1999 (with closing to occur on November 1, 1999) for a purchase
              price of $3,000,000.

         In each case, the option price exceeds the Company's current net book
value for each such property. The Company believes that even if all of the
purchase options are exercised, such exercise will not have an adverse effect
upon the operations of the Company or its ability to maintain its distribution
policy. In addition, if any purchase option is exercised, the Company intends to
either distribute the cash proceeds to stockholders or reinvest the cash
proceeds in additional properties. However, no assurance can be given that such
distribution or reinvestment will occur.

         In addition to purchase options, the Company has granted to tenants of
certain properties a right of first refusal (in the event the Company has
received an unsolicited offer from a third party to purchase the property which
the Company desires to accept) or a right of first offer (in the event the
Company has not received an unsolicited third party offer for the property but
desires to entertain an offer). The properties subject to one or both of these
rights include One Wildlife Way, Long Grove, Illinois, 8901 102nd Street,
Pleasant Prairie, Wisconsin, 825 Tollgate Road, Elgin, Illinois, 1651 Frontenac
Road, Naperville, Illinois 7001 Adams Street, Willowbrook, Illinois, 950 Tower
Road, Mundelein, Illinois, 6312 W. 74th Street, Bedford Park, Illinois, 11440 W.
Addison, Franklin Park, Illinois and 7633 S. Sayre, Bedford Park, Illinois. The
existence of those rights will not compel the Company to sell a property for a
price less than the price the Company desires to accept.


                                       21
<PAGE>

THE COMPANY'S OTHER PROPERTIES AND INVESTMENTS

         In addition to its warehouse/industrial properties, the Company owns
three retail properties having approximately 61,000 square feet of GLA, one
office building having approximately 94,000 square feet of GLA in which the
offices of the management company use approximately 48,000 square feet and the
remaining portion is under redevelopment, one 682-unit apartment complex located
at 440 North Lake Street, Miller, Indiana and known as Lakeshore Dunes
Apartments, and a fully leased parking lot. The Company does not intend to
acquire properties other than warehouse/industrial properties in the future. The
Company believes, however, that these properties are favorable investments for
the Company, adding to distributable cash flow per share. Furthermore, the
Lakeshore Dunes Apartments were financed through the issuance of tax-exempt
revenue bonds on favorable terms, benefiting the Company by reducing its overall
borrowing costs. The Company has no present plans to sell those properties but
would entertain a sale if the price were sufficiently high, given other
investment opportunities that would be available to the Company, and the
enhanced operating performance expected to result, from redeployment of the
sales proceeds. The Company also has investments in 9 uncompleted build-to-suit
properties totaling approximately 1.6 million square feet, and has two mortgage
receivables on properties totaling 824,000 square feet.

         The following table sets forth certain information regarding the
Company's retail properties:

<TABLE>
<CAPTION>
                                                                      PERCENT
                         YEAR OF                                         OF
                      ACQUISITION/                           PERCENT    GLA                   AVERAGE
                          LAST         YEAR OF      TOTAL      OF      LEASED                   RENT
                      REDEVELOPMENT   ORIGINAL       GLA     TOTAL     AS OF     ANNUALIZED     PER       NUMBER
                           OF        CONSTRUCTION/ (SQ. FT.)  GLA     DECEMBER   BASE RENT    SQ. FT.       OF
                      EXPANSION (1)   EXPANSION      (2)      (3)     31, 1998    REVENUE       (4)      TENANTS
                      -------------   ---------      ---      ---     --------    -------       ---      -------

<S>                   <C>            <C>           <C>       <C>      <C>        <C>           <C>       <C>
4-48 Barring Rd.          1994              1991     38,633    63.1%    76.9%      $315,565       $8.17         8
Streamwood, IL
84-120 McHenry Rd.      1990/1993           1989     20,535    33.6%    80.0%       307,774       14.99         8
Wheeling, IL
351 North Rohlwing Rd.    1993              1989      2,015     3.3%   100.0%        61,440       30.49         1
                                                      -----     ----                 ------       -----         -
Itasca, IL

TOTAL                                                61,183   100.0%               $684,779      $11.19        17
                                                     ======   ======               ========      ======        ==
</TABLE>

----------------------


(1)  First date is year of acquisition; second date is year of most recent
     redevelopment or expansion. If only one date appears, it is the acquisition
     date; the property has not been redeveloped or expanded.
(2)  "GLA" means gross leasable area.
(3)  Determined as a percent of the total GLA for the retail properties.
(4)  Determined by dividing annualized base rent revenue by GLA.

         The tenants of the Company's retail properties are typical of tenants
in smaller retail centers in Greater Chicago. Generally, the leases require
tenants to pay a fixed base, or "minimum" rent, subject to scheduled increases.
Tenants generally are required to pay their proportionate share of common area
maintenance charges, insurance expenses, operating expenses and real estate
taxes or their portion of these expenses is included in their base rent.


                                       22
<PAGE>

         The following table shows as of December 31, 1998 scheduled lease
expirations for the retail properties commencing January 1, 1999, and for the
next ten years, assuming no tenants exercise renewal options.

<TABLE>
<CAPTION>
                               GLA OF    ANNUALIZED                       % OF TOTAL RETAIL    % OF 1998 RETAIL
                   NO. OF     EXPIRING    BASE RENT   AVERAGE BASE RENT     PROPERTIES GLA        BASE RENT
  YEAR ENDING      LEASES      LEASES     EXPIRING    PER SQ. FT. UNDER     REPRESENTED BY      REPRESENTED BY
  DECEMBER 31     EXPIRING   (SQ. FT.)     LEASES      EXPIRING LEASES     EXPIRING LEASES     EXPIRING LEASES
  -----------     --------   ---------     ------      ---------------     ---------------     ---------------

<S>               <C>        <C>         <C>          <C>                  <C>                 <C>
     1999            2          3,918       $57,468        $14.67               9.14%                9.48%
     2000            5         10,334       113,100         10.94              24.11%               18.66%
     2001            5         14,120       150,084         10.63              32.94%               24.77%
     2002            0              0             0             0                  0%                   0%
     2003            1          3,080        31,596         10.26               7.19%                5.21%
     2004            2          5,274       125,976         23.89              12.30%               20.79%
     2005            0              0             0             0                  0%                   0%
     2006            1          6,140       127,788         20.81              14.32%               21.09%
     2007            0              0             0             0                  0%                   0%
     2008            0              0             0             0                  0%                   0%
</TABLE>

         Lakeshore Dunes Apartments, which was completed in 1971 and renovated
between 1991 and September, 1993 is comprised of 682 units in 15 contiguous
buildings located on an approximately 20.12 acre site in Miller, Indiana, a
suburb of Gary, Indiana, located on Lake Michigan. The property is bordered by
the Indiana Dunes National Park and by the Calumet Lagoon and is less than
one-half mile from public beaches. Amenities of the complex include redesigned
units with updated kitchens and appliances, carpeting, lighting, windows and
mini-blinds, bathrooms and fixtures, elevators, laundry rooms, play lots, tennis
courts, picnic areas, a new outdoor pool, roads, parking areas, landscaping and
a 24-hour safety patrol and card access system. The community center also serves
as the management and leasing office. The Company maintains a complete
management, leasing and maintenance team at the property.

         As of December 31, 1998, 621 of the units, or 91%, were leased,
providing for a monthly base rent of approximately $270,000 or $7.34 per square
foot (determined by dividing annualized base rent by total leased square footage
of the apartment units), or an annualized base rent of $3,240,000. Current
leases provide for customary one year terms and require that tenants pay a fixed
rent based on the type of apartment and square footage. Tenants are responsible
for utilities. The following table sets forth the apartment mix at this property
as of December 31, 1998:

<TABLE>
<CAPTION>
                                NUMBER OF UNITS         TOTAL GLA        AVERAGE GLA PER       AVERAGE MONTHLY
TYPE OF APARTMENT                  IN COMPLEX           (SQ. FT.)      APARTMENT (SQ. FT.)      RENT PER UNIT
-----------------                  ----------           ---------      -------------------      -------------

<S>                             <C>                     <C>            <C>                     <C>
Studio                                    48             20,208                421                $ 374
One Bedroom                              171             99,009                579                  459
Deluxe One Bedroom                        43             29,283                681                  467
Two Bedroom                              390            308,100                790                  533
Three Bedroom                             30             28,500                950                  656
                                         ---            -------
TOTALS:                                  682            485,100
                                         ===            =======
</TABLE>

              In 1996, the Company purchased a parking lot within an industrial
park. The parking lot is leased for ten years through January 2006 for an annual
minimum rent of $26,400.


                                       23
<PAGE>

ITEM 3.       LEGAL PROCEEDINGS.

         The Company is not subject to or involved in, nor is the Company aware
of, any pending or threatened litigation which could be material to the
financial position or results of operations of the Company. For a description of
remediation activities currently underway at certain of the Company's
properties, see "Environmental Matters" under Item 1 above.

ITEM 4.       SUBMISSION OF CERTAIN ITEMS TO A VOTE OF SECURITY HOLDERS.

              None.


                                       24

<PAGE>

                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED MATTERS.

         (a) Prior to June 12, 1996, the Company's Common Stock was listed and
traded on the American Stock Exchange under the symbol "CNT." Effective on June
12, 1996, the Company's Common Stock is listed and traded on the New York Stock
Exchange under the symbol "CNT." The following table sets forth, for the periods
indicated, the high and low sale prices of the Common Stock (as reported by the
AMEX prior to June 12, 1996 and as reported by the NYSE on and after June 12,
1996) and the cash distributions paid in such periods.

<TABLE>
<CAPTION>

                                                                                                    CASH
         QUARTERLY PERIOD ENDING                                    HIGH              LOW       DISTRIBUTION/SHARE
         -----------------------                                    ----              ---       ------------------
<S>                                                             <C>              <C>                <C>
         December 31, 1995..............................        $23-3/8          $21-5/8            $0.390
         March 31, 1996.................................         24-1/8           22                 0.405
         June 30, 1996..................................         27               26-1/8             0.405
         September 30, 1996.............................         26-7/8           26-3/4             0.405
         December 31, 1996..............................         32-3/4           30-7/8             0.405
         March 31, 1997.................................         32-7/8           30-1/4             0.420
         June 30, 1997..................................         31-7/8           28-1/2             0.420
         September 30, 1997.............................         36-5/16          31-7/8             0.420
         December 31, 1997..............................         37-1/16          31-1/4             0.420
         March 31, 1998.................................         36-1/16          32-3/4             0.438
         June 30, 1998..................................         35-5/8           31-7/16            0.438
         September 30, 1998.............................         36-7/16          30-11/16           0.438
         December 31, 1998..............................         36-7/8           32-1/4             0.438
</TABLE>

         (b)      As of March 11, 1999, there were approximately 163 holders of
record of the Company's Common Stock.

         (c)      During 1998, the Company paid distributions on common shares
of $31.2 million or $1.75 per share and on class B common shares of $3.7 million
or $1.80 per share. Also, in January of 1998, the Company paid dividends on
preferred shares of $1.4 million or $0.477 per share, and in April, July and
October of 1998, paid dividends of $1.6 million or $0.53 per share each time. As
of the end of 1998, the Company declared preferred dividends of $1.6 million or
$0.53 per share to be paid in January, 1999. During 1997, the Company declared
and paid distributions on common shares of $27.2 million or $1.68 per share and
on class B common shares of $3.9 million or $1.73 per share. The Company's
Consolidated Statements of Operations and Shareholders' Equity for 1997 included
$901 thousand or $0.30 per share of preferred dividends attributable to 1997.

         The following factors, among others, will affect the future
availability of funds for distribution: (i) scheduled increases in base rents
under existing leases, (ii) changes in minimum base rents attributable to
replacement of existing leases with new or replacement leases and (iii)
restrictions under certain covenants of the Company's unsecured credit facility
co-led by The First National Bank of Chicago and Lehman Brothers Holdings, Inc.


                                       25

<PAGE>

ITEM 6.  SELECTED HISTORICAL FINANCIAL DATA

         The following tables set forth, on a historical basis, Selected
Financial Data for the Company. The following table should be read in
conjunction with the historical financial statements of the Company and
"MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATION," both included elsewhere in this Form 10-K/A.

         As discussed in Note 2A to the financial statements, the Company
determined that it had recognized certain participation, assignment, consulting
and financing fees in periods in advance of that permitted and has revised
previously issued financial statements accordingly. In addition, the Company
revised previously issued financial statements to recognize, for financial
reporting purposes, certain gains in connection with tax-deferred exchanges that
had not been previously recognized. Accordingly, the financial statements and
the Selected Financial Data for the years ended December 31, 1998 and 1997 shown
below have been revised.

         The Selected Financial Data for the Company is not necessarily
indicative of the actual financial position of the Company or results of
operations at any future date or for a future period.

                  CENTERPOINT PROPERTIES TRUST AND SUBSIDIARIES
                       SELECTED HISTORICAL FINANCIAL DATA
   (IN THOUSANDS, EXCEPT FOR PER SHARE DATA, RATIOS AND NUMBER OF PROPERTIES)

<TABLE>
<CAPTION>

                                                                       YEAR ENDED DECEMBER 31,
                                                                       -----------------------
                                                    1998        1997
                                                  REVISED      REVISED             1996          1995          1994
                                                  -------      -------             ----          ----          ----
<S>                                               <C>           <C>             <C>           <C>           <C>
Operating Data:
   Revenues                                       $107,226      $85,588         $63,330       $46,952       $33,633

  Expenses:
    Operating expenses excluding depreciation
       and amortization (1)                        (35,700)     (29,182)        (20,751)      (14,774)      (11,442)
    Depreciation and other amortization            (21,418)     (15,278)        (10,648)       (8,456)       (6,176)
    General and administrative                      (4,041)      (3,105)         (2,567)       (2,150)       (1,573)
     Interest expense:
        Interest incurred, net                     (13,659)     (10,071)         (9,865)      (11,562)      (11,073)
        Amortization of deferred financing costs    (1,817)        (800)         (1,127)       (1,150)         (976)
                                                  --------      --------        --------      --------      --------
  Operating income                                  30,591       27,152          18,372         8,860         2,393
     Gain on real estate                             1,672
     Other income (expense) (2)                        (15)         108            (100)          (16)          (34)
                                                  --------      --------        --------      --------      --------
   Income before extraordinary item                 32,248       27,260          18,272         8,844         2,359
     Extraordinary item                                                          (3,331)         (632)
                                                  --------      --------        --------      --------      --------
  Net income                                        32,248       27,260          14,941         8,212         2,359
  Preferred dividend                                (6,360)        (901)           (947)       (1,002)
                                                  --------      --------        --------      --------      --------
  Net income available to common shareholders       25,888       26,359          13,994         7,210         2,359

  Per share net income available to common
    Shareholders before extraordinary item:
         Basic                                        1.30         1.41            1.25          0.85          0.41
         Diluted                                      1.29         1.39            1.22          0.84          0.41


                                       26

<PAGE>
<S>                                               <C>           <C>             <C>           <C>           <C>
  Per share net income available to common
    shareholders:
         Basic                                        1.30         1.41            1.01          0.78          0.41
         Diluted                                      1.29         1.39            0.99          0.77          0.41

Balance Sheet Data (End of Period):
  Investment in real estate (before accumulated
    depreciation)                                 $768,857     $662,275        $429,034      $317,460      $248,281
  Net investment in real estate                    706,600      617,923         398,828       295,884       234,825
  Total assets                                     817,606      699,055         451,206       334,866       254,073
  Total debt                                       364,718      270,735         177,349       145,271       179,492
  Shareholders' equity                             407,459      387,756         248,114       168,320        59,016
</TABLE>


                                       27

<PAGE>

<TABLE>
<CAPTION>

                                                    1998         1997
                                                  REVISED       REVISED            1996          1995          1994
                                                  -------       -------            ----          ----          ----
<S>                                               <C>           <C>            <C>            <C>           <C>
Other Data:
  Funds from Operations (3)                        $46,777       $42,684        $30,445       $20,492       $13,138
  EBITDA (4)                                        69,142        53,409         39,912        30,013        20,584
  Net cash flow:
       Operating activities                         57,804        39,411         29,552        16,473         8,976
       Investing activities                       (118,706)     (245,336)      (111,554)      (82,556)      (65,311)
       Financing activities                         59,725       206,507         80,194        68,541        52,837
  Distributions                                     41,233        32,046         24,065        15,953         8,775
  Return of capital portion of distribution          3,711         3,916         12,280         8,554         4,320
  Number of properties included in operating
    results (5)                                        126           101             76            69            53
  Ratio of earnings to fixed charges                  2.70          3.24           2.33          1.63          1.19
  Ratio of earnings to combined fixed charges
    and preferred dividends                           1.98          3.01           2.15          1.51          1.19
</TABLE>
-------------------

(1)      Operating expenses include real estate taxes, repairs and maintenance,
         insurance and utilities and exclude interest, depreciation and
         amortization and general and administrative expenses.

(2)      Other income (expense) includes gains and losses on property
         dispositions in 1997 and 1996, and other miscellaneous operating and
         non-operating items.

(3)      Funds from Operations represents net income available to common
         shareholders, excluding extraordinary items, plus depreciation and
         amortization, convertible subordinated debenture interest and
         amortization of deferred financing costs on convertible subordinated
         debentures. Dividends on Convertible Preferred Shares for 1996 and 1995
         are not excluded from net income as such shares were automatically
         converted to common shares in 1996. Funds from operations is computed
         as follows:

<TABLE>
<CAPTION>

                                                        1998         1997
                                                      REVISED      REVISED           1996           1995         1994
                                                      -------      -------           ----           ----         ----
<S>                                                    <C>          <C>           <C>            <C>          <C>
          Net income available to common
               Shareholders                            $25,888      $26,359       $14,941         $8,212       $2,359
          Extraordinary item                                                        3,331            632           --
          Depreciation and amortization                 21,418       15,278        10,648          8,456        6,176
          Amortization of deferred financing costs,
               Debentures                                   38           48            67            135          267
          Convertible subordinated debenture
          interest                                         783          999         1,385          3,057        4,336
          Depreciation of properties sold                (1350)
          Loss on disposition of properties                 --           --            73             --           --
                                                        ------       ------        ------         ------       ------
          Funds from Operations                        $46,777      $42,684       $30,445        $20,492      $13,138
                                                       =======      =======       =======        =======      =======
</TABLE>

         Management of the Company believes that Funds from Operations is
         helpful to investors as a measure of the performance of equity REIT
         shares because, along with cash flows from operating activities,
         financing activities and investing activities, it provides investors an
         understanding of the ability of the Company to incur and service debt
         and to make capital expenditures. Funds from Operations does not
         represent cash flow from operations as defined by generally accepted
         accounting principles ("GAAP"), should not be considered by the reader
         as an alternative to net income as an indicator of the Company's
         operating performance or to cash flows as a measure of liquidity, and
         is not indicative of cash available to fund all cash flow needs.
         Investors are


                                       28
<PAGE>

         cautioned that Funds from Operations, as calculated by the Company, may
         not be comparable to similarly titled but differently calculated
         measurers for other REITs.

         The National Association of Real Estate Investment Trusts (NAREIT)
         defines funds from operations as net income before extraordinary items
         plus depreciation and amortization less the amortization of deferred
         financing costs.

(4)      Earnings before interest, income taxes, depreciation and amortization.
         Management believes that EBITDA is helpful to investors as an
         indication of property operations, because it excludes costs of
         financing and non-cash depreciation and amortization amounts. EBITDA
         does not represent cash flows from operations as defined by GAAP,
         should not be considered by the reader as an alternative to net income
         as an indicator of the Company's operating performance, and is not
         indicative of cash available to fund all cash flow needs.

(5)      Increase in number of properties in 1994 reflects the acquisition of 15
         properties throughout 1994. Increase in number of properties reflects
         acquisition of 16 properties throughout 1995. Increase in number of
         properties in 1996 reflects acquisition of 15 properties and the
         disposition of 8 properties throughout 1996. Increase in number of
         properties in 1997 reflects the acquisition of 21 properties, the
         completion of 7 developments, and the disposition of 3 properties
         throughout 1997. Increase in number of properties in 1998 reflects the
         acquisition of 30 properties, the completion of 2 developments, and
         the disposition of 6 properties throughout 1998. See "MANAGEMENT'S
         DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
         OPERATIONS."


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

GENERAL BACKGROUND

         The following is a discussion of the historical operating results of
the Company. This discussion should be read in conjunction with the Financial
Statements and the information set forth under "SELECTED HISTORICAL FINANCIAL
DATA."

The Company announced in the 3rd quarter 1999 that it was restating previously
audited and unaudited financial statements for the years 1997, 1998 and 1999.
See Exhibit 99 to this Form 10-K/A.

         The revision reflects the recognition of gains, for financial reporting
purposes, on certain completed sales structured as tax-deferred exchanges under
Section 1031 of the Internal Revenue Code, where gains are not recognized for
tax purposes. Secondly, the revision reflects the timing of gain recognition
from other property sales related to the Company's development activity. While
the timing of the reported gains from these latter transactions has been
shifted, the aggregate gain remains unchanged and no cash or tax effect has
resulted. As of the 3rd quarter 1999, all gains have been recognized.

         The results of the Company reflect cumulative significant acquisitions,
build-to-suit and redevelopment activities. Since 1989, the Company has grown
its portfolio of owned properties from 6 properties, with approximately 1.9
million square feet, to 126 properties with approximately 25.0 million


                                       29

<PAGE>

square feet as of December 31, 1998. This total excludes properties under
development and mortgage investments. Through the issuance of mortgages on
properties and build-to-suit projects under development, the Company has a total
of 136 property investments, excluding the parking lot, representing
approximately 26.6 million square feet.

         The Company grew its total property investments by 6% in 1998, which
includes build-to-suits in progress and mortgage investments. In addition, the
Company grew its portfolio of owned properties during the year by concluding
thirty warehouse/industrial property acquisitions and two warehouse/industrial
build-to-suit properties, net of the disposition of six warehouse/industrial
properties. The Company's total increase in owned warehouse/industrial area, net
of disposals, was 3.4 million square feet or 16.7%.

         The Company's Consolidated Financial Statements for the years ended
December 31, 1998, 1997 and 1996 reflect partial period results for
acquisitions, dispositions and expansions made during each respective year.
These statements also include the lease-up of previously vacant space, related
to the properties owned by the Company as of January 1, 1998, 1997 and 1996,
respectively. Certain executive officers of the Company had an interest in
entities which were purchased by the Company (one property in 1998, one property
in 1997 and three properties in 1996). These transactions satisfied the
Company's investment criteria and were approved by the Company's independent
trustees.

         Finally, the historical results of the Company reflect the Company's
significant property development and redevelopment activities in which
substantial capital costs and related expenses were incurred in advance of
receipt of rental income. At December 31, 1998, the Company and its subsidiaries
had $18.4 million invested in build-to-suit projects under development which
were not producing income as of the end of the year. As of December 31, 1998,
the Company owns 11 properties totaling 6.0 million square feet that the Company
has redeveloped or is currently holding to redevelop. Redevelopments are
typically larger properties that are acquired, subdivided and released. During
construction, certain costs are capitalized; however, in certain circumstances,
such costs are expended after completion but prior to leasing, resulting in a
decline in net income.

RESULTS OF OPERATIONS

COMPARISON OF YEAR ENDED DECEMBER 31, 1998 TO YEAR ENDED DECEMBER 31, 1997

REVENUES

Total revenues increased by $21.6 million or 25.3% over the same period last
year.

In the twelve months of 1998, 97.4% of total revenues of the Company were
derived primarily from base rents, straight-line rents, expense reimbursements
and mortgage income (operating and investment revenue), pursuant to the terms of
tenant leases and mortgages for occupied space at the warehouse/industrial
properties.

Operating and investment revenues increased by $23.5 million in 1998. A portion
of the increase from the prior year is due to income from thirty properties
acquired in 1998 and two build-to-suit property coming on line totaling 4.0
million square feet, net of six dispositions as of the end of the year. The
remainder of the increase was attributable to a full period of income from the
1997 acquisition of twenty-


                                       30

<PAGE>

one properties, totaling 7.1 million square feet and seven build-to-suit
properties totaling 1.6 million square feet coming on-line in 1997, net of three
property dispositions.

Other revenues decreased $1.9 million due to decreased fees earned and profits
realized by the Company and the Company's unconsolidated affiliate in connection
with increased build-to-suit, development and leasing activities.

OPERATING AND NONOPERATING EXPENSES

Real estate tax expense and property operating and leasing expense increased by
$6.5 million from year to year. The majority of the increase, $5.1 million,
resulted from a full period of real estate taxes on 1997 acquisitions and a
partial period of real estate taxes on 1998 acquisitions, net of dispositions.
The balance of the increase was due to increased leasing expenses, insurance,
utilities, repairs and maintenance and property management costs, which
increased proportionate to the level of acquisitions. However, property
operating and leasing costs as a percentage of total revenues decreased from
14.1% to 12.6% when comparing 1997 to 1998 due to efficiencies realized by the
Company.

General and administrative expenses increased by $0.9 million for the period due
primarily to the growth of the Company, but as a percentage of total revenues
increased only slightly from 3.6% to 3.8% when comparing years.

Depreciation and amortization increased by $6.1 million due to a full period of
depreciation on 1997 acquisitions and depreciation on 1998 acquisitions.

Interest incurred increased by approximately $3.6 million over the same period
last year due to the Company holding higher average balances outstanding in the
second quarter of 1998 compared to 1997.

Other income (expenses) increased due to gains earned upon the disposition of
six properties in 1998. In 1997, the Company disposed of three properties with
much lower gains earned.

NET INCOME AND OTHER MEASURES OF OPERATIONS

Net income increased $5.0 million or 18.3% due to the growth of the Company
through the net acquisition of Warehouse/Industrial real estate and merchant
income.

Funds from operations ("FFO") increased 9.6% from $42.7 million to $46.8
million. The National Association of Real Estate Investment Trusts ("NAREIT")
defines funds from operations as net income before extraordinary items plus
depreciation and amortization less the amortization of deferred financing costs.
The Company considers FFO and FFO growth to be one relevant measure of financial
performance of equity REITs that provides a relevant basis for comparison among
REITs, and it is presented to assist investors in analyzing the performance of
the Company.

On a cash basis, when comparing the 1997 results of operations of properties
owned January 1, 1997 with the results of operations of the same properties for
1998 (the "same property" portfolio), the Company recognized an increase of
approximately 2.0% in net operating income. This same property increase was due
to the timely lease up of vacant space, rental increases on renewed leases and
contractual increases in minimum rent under leases in place.


                                       31

<PAGE>

The Company assesses its operating results, in part, by comparing the Net
Revenue Margin between periods. Net Revenue Margin is calculated for the "in
service" portfolio by dividing net revenue (total operating and investment
revenue less real estate taxes and property operating and leasing expense) by
adjusted operating and investment revenue (operating and investment revenue less
expense reimbursements, adjusted for leases containing expense stops). This
margin indicates the percentage of revenue actually retained by the Company or,
alternatively, the amount of property related expenses not recovered by tenant
reimbursements. The margin for 1998 was 88.7% compared with 88.1% for 1997.

COMPARISON OF YEAR ENDED DECEMBER 31, 1997 TO YEAR ENDED DECEMBER 31, 1996

REVENUES

Total revenues increased by $22.3 million or 35.1% over 1996.

In the twelve months of 1997, 94.6% of total revenues of the Company were
derived primarily from base rents, straight-line rents, expense reimbursements
and mortgage income (operating and investment revenue), pursuant to the terms of
tenant leases and mortgages for occupied space at the warehouse/industrial
properties.

Operating and investment revenues increased by $23.8 million in 1997. A portion
of the increase from the prior year is due to income from twenty-one properties
acquired in 1997 and seven build-to-suit properties coming on line totaling 8.7
million square feet, net of three dispositions as of the end of the year. The
remainder of the increase was attributable to a full period of income from the
1996 acquisition of thirteen properties, totaling 3.3 million square feet, net
of seven property dispositions.

Other revenues decreased $1.6 million due to decreased fees earned and profits
realized by the Company and the Company's unconsolidated affiliate in connection
with decreased build-to-suit, development and leasing activities.

OPERATING AND NONOPERATING EXPENSES

Real estate tax expense and property operating and leasing expense increased by
$8.4 million from year to year. The majority of the increase, $5.2 million,
resulted from a full period of real estate taxes on 1996 acquisitions and a
partial period of real estate taxes on 1997 acquisitions, net of dispositions.
The balance of the increase was due to increased leasing expenses, insurance,
utilities, repairs and maintenance and property management costs, which
increased proportionate to the level of acquisitions. However, property
operating and leasing costs as a percentage of total revenues increased only
slightly from 14.0% to 14.1% when comparing 1996 to 1997 due to efficiencies
realized by the Company.

General and administrative expenses increased by $0.5 million for the period due
primarily to the growth of the Company, but as a percentage of total revenues
decreased from 4.1% to 3.6% when comparing years.

Depreciation and amortization increased by $4.6 million due to a full period of
depreciation on 1996 acquisitions and depreciation on 1997 acquisitions.

Interest incurred increased by approximately $0.2 million over the same period
last year due to the Company holding higher average balances outstanding in the
second quarter of 1997 compared to 1996.


                                       32

<PAGE>

Other income (expenses) increased due to the non-recurring disposal of fixed
assets for a gain which occurred in 1997.

In 1996, the Company incurred an extraordinary loss of $3.3 million representing
a write off of unamortized deferred financing costs as a result of the
re-financing of its outstanding revenue bonds. In addition, the Company replaced
its $92 million secured lines of credit with a $135 million unsecured credit
facility at a significant savings in interest.

NET INCOME AND OTHER MEASURES OF OPERATIONS

Net income increased $12.3 million or 82.5% due to the growth of the Company
through the net acquisition of Warehouse/Industrial real estate and merchant
income.

FFO increased 40.5% from $30.4 million to $42.7 million.

On a cash basis, when comparing the 1996 results of operations of properties
owned January 1, 1996 with the results of operations of the same properties for
1997 (the "same property" portfolio), the Company recognized an increase of
approximately 6.0% in net operating income. This same property increase was due
to the timely lease up of vacant space, rental increases on renewed leases and
contractual increases in minimum rent under leases in place.

The Net Revenue Margin for 1997 was 88.1% compared with 84.3% for 1996.

LIQUIDITY AND CAPITAL RESOURCES

OPERATING AND INVESTMENT CASH FLOW

Cash flow generated from Company operations has historically been utilized for
working capital purposes and distributions, while proceeds from financings and
capital raises have been used to fund acquisitions and other capital costs.
However, cash flow from operations during 1998 of $57.8 million net of $41.1
million of 1998 distributions provided $16.7 million of retained capital. The
Company expects retained capital to fund a portion of future investment
activities.

In 1998, the Company's investment activities include acquisitions of $69.7
million, advances for construction in progress of $23.8 million, advances on
mortgage notes receivable of $17.5 million, advances to affiliate to fund
construction activities of $33.5 million and improvements and additions to
properties of $27.0 million. These activities were funded with dispositions of
real estate of $33.9 million, advances on the company's line of credit of $132.0
million and a portion of the Company's retained capital.

EQUITY AND SHARE ACTIVITY

On March 25, 1998, the Company completed a public offering of 370,371 common
shares of beneficial interest at $32.0625 per share in an underwritten offering
to a unit investment trust. Net proceeds of $11.8 million from the public
offering, proceeds from the repayment of mortgage notes receivable, and working
capital were used to repay amounts outstanding under the Company's line of
credit of $30.1 million.


                                       33

<PAGE>

On April 8, 1998 the Company completed the private placement of 370,000 common
shares of beneficial interest at $33.375 per share to an institutional investor.
The net proceeds of the offering of approximately $12.1 million were used to
fund working capital requirements.

During 1998, the Company paid distributions on common shares of $31.2 million or
$1.75 per share and on class B common shares of $3.7 million or $1.80 per share.
Also, in January of 1998, the Company paid dividends on preferred shares of $1.4
million or $0.477 per share, and in April, July and October of 1998, paid
dividends of $1.6 million or $0.53 per share each time. The following factors,
among others, will affect the future availability of funds for distribution: (i)
scheduled increases in base rents under existing leases, (ii) changes in minimum
base rents attributable to replacement of existing leases with new or
replacement leases and (iii) restrictions under certain covenants of the
Company's unsecured credit facility co-led by The First National Bank of Chicago
and Lehman Brothers Holdings, Inc.

DEBT CAPACITY

In November, 1998, the Company increased to $250 million its unsecured credit
facility co-led by The First National Bank of Chicago and Lehman Brothers
Holdings Inc. As of March 11, 1999, the Company had outstanding borrowings of
approximately $102.6 million under the unsecured revolving line of credit
(approximately 9.2% of the Company's fully diluted total market capitalization),
and the Company had remaining availability of approximately $147.4 million under
its unsecured line of credit.

At December 31, 1998, the Company's debt constituted approximately 31.7% of its
fully diluted total market capitalization. Also, the Company's EBITDA to debt
service coverage ratio remained high at 5.7 to 1, and the Company's EBITDA to
fixed charge coverage ratio decreased to 3.8 to 1 due to preferred dividends.
The Company's fully diluted common equity market capitalization was
approximately $696.3 million, and its fully diluted total market capitalization
exceeded $1.1 billion. The Company's leverage ratios benefited during 1998 from
the conversion of approximately $3.7 million of its 8.22% Convertible
Subordinated Debentures, due 2004, to 201,748 common shares.

In February, 1998, Duff & Phelps Credit Rating Co. joined Moody's Investors
Service's January, 1997 evaluation by assigning investment grade rating to the
Company's senior unsecured debt and preferred stock issuable under the Company's
shelf registration statement and convertible subordinated notes. Also in 1997,
Standard and Poors assigned an investment grade rating to the Company's senior
unsecured debt. These investment grade ratings further enhance the Company's
financial flexibility.

The Company has considered its short-term (one year or less) capital needs, in
conjunction with its estimated future cash flow from operations and other
expected sources. The Company believes that its ability to fund operating
expenses, building improvements, debt service requirements and the minimum
distribution required to maintain the Company's REIT qualification under the
Internal Revenue Code, will be met by recurring operating and investment revenue
and other real estate income.

Long-term (greater than one year) capital needs for property acquisitions,
scheduled debt maturities, major redevelopment projects, expansions, and
construction of build-to-suit properties will be supported, initially, by draws
on the Company's unsecured line of credit, followed by the issuance of long-term
unsecured indebtedness and the issuance of equity securities. Management expects
that a significant portion of the Company's investment funds will be supplied by
the proceeds of property dispositions.


                                       34

<PAGE>

INFLATION

Inflation has not had a significant impact on the Company because of the
relatively low inflation rates in the Company's markets of operation. Most of
the Company's leases require the tenants to pay their share of operating
expenses, including common area maintenance, real estate taxes and insurance,
thereby reducing the Company's exposure to increases in costs and operating
expenses resulting from inflation. In addition, many of the leases are for
remaining terms less than five years which may enable the Company to replace
existing leases with new leases at higher base rental rates if rents of existing
leases are below the then-existing market rate.

YEAR 2000 COMPLIANCE

In response to the Year 2000 issue, the Company initiated a project in early
1997 to identify, evaluate and implement a new computerized real estate
management system. The Company is addressing the issue through a combination of
modifications to existing programs and conversion to Year 2000 compliant
software. In addition, the Company is discussing with its tenants, vendors, and
other service providers the possibility of any interface difficulties relating
to the Year 2000 issue which may affect the Company. If the Company and those it
conducts business with do not make modifications or conversions in a timely
manner, the Year 2000 issue may have a material adverse effect on the Company's
business, financial condition, and results of operations. The total cost
associated with the required modifications is not expected to be material to the
Company's consolidated results of operations, liquidity and financial position,
and is being expensed as incurred.

RECENT PRONOUNCEMENTS

In June, 1997, the FASB issued SFAS Statement No. 130, "Reporting Comprehensive
Income." This statement, effective for periods beginning after December 15,
1997, requires the Company to report components of comprehensive income in a
financial statement that is displayed with the same prominence as other
financial statements. Comprehensive income is defined by Concepts Statement No.
6, "Elements of Financial Statements" as the change in equity of a business
enterprise during a period from transactions and other events and circumstances
from nonowner sources. It includes all changes in equity during the period
except those resulting from investment by owners and distributions to owners. As
required by this statement, the Company adopted the new standard for reporting
comprehensive income. The Company's net income is equal to comprehensive income.

In June, 1997, the FASB issued SFAS Statement No. 131, "Disclosures about
Segments of an Enterprise and Related Information." This statement, effective
for financial statements for fiscal years beginning after December 15, 1997,
requires that a public business enterprise report financial and descriptive
information about its reportable operating segments. Generally, financial
information is required to be reported on the basis that it is used internally
for evaluating segment performance and deciding how to allocate resources to
segments. The Company has determined its statement disclosure reflects the basis
by which management analyzes the Company's performance.

In March, 1998, the FASB's Emerging Issues Task Force ("EITF") issued EITF Issue
No. 97-11, "Accounting for Internal Costs Related to Real Estate Acquisitions."
This statement, effective as of


                                       35

<PAGE>

March 19, 1998, requires that internal costs of identifying and acquiring
operating properties should be expensed as incurred. Prior to March 19, 1998,
the Company capitalized internal preacquisition costs. The adoption of this EITF
has not had a significant impact on the results of current operations and the
Company estimates this EITF will not have a significant impact on the results of
operations in the future.

In May, 1998, the FASB issued SFAS Statement No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This statement, effective for financial
statements for fiscal years beginning after June 15, 1999, provides a
comprehensive and consistent standard for the recognition and measurement of
derivatives and hedging activities. The Company has disclosed its only
derivative position within the Debt footnote to the financial statements.

FORWARD LOOKING STATEMENTS

This Report on Form 10-A contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The Company's actual results could
differ materially from those set forth in the forward looking statements as a
result of various factors, including, but not limited to, uncertainties
affecting real estate businesses generally (such as entry into new leases,
renewals of leases and dependence on tenants' business operations), risks
relating to acquisition, construction and development activities, possible
environmental liabilities, risks relating to leverage, debt service and
obligations with respect to the payment of dividends (including availability of
financing terms acceptable to the Company and sensitivity of the Company's
operations to fluctuations in interest rates), the potential for the need to use
borrowings to make distributions necessary for the Company to qualify as a REIT,
dependence on the primary market in which the Company's properties are located,
the existence of complex regulations relating to the Company's status as a REIT,
the failure of the Company and entities the Company does business with to make
necessary modifications and conversions to Year 2000 compliant software in a
timely manner and the potential adverse impact of the market interest rates on
the cost of borrowings by the Company and on the market price for the Company's
securities.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is subject to market risk associated with changes in interest rates
as follows:

During 1998 the Company entered into an agreement to lock in a fixed interest
rate on an anticipated 1999 refinancing of certain mortgage notes payable. The
agreement has a notional amount of $25 million and provides that the Company
will either receive or pay an amount equal to the spread between a locked in
treasury rate (4.835%) and the interest rate on treasury securities underlying
the agreement as of the determination date, which is to be triggered by the
Company on or before May 17, 1999. If settlement of the agreement had been
triggered at December 31, 1998 or February 25, 1999 the Company would have had
to pay approximately $365,000 or would have received approximately $436,000,
respectively. A 25 basis point movement in the base treasury securities
underlying the agreement would have an approximately $468,000 increase or
decrease in the amount the Company would receive or pay under the agreement as
of February 25, 1999.

As of December 31, 1998 the Company's long term debt includes a mortgage note
payable, tax exempt debt and borrowings under a line of credit totaling $154.8
million, all of which bear interest at variable rates that float with the
market. A 25 basis point movement in the interest rates underlying these debt


                                       36

<PAGE>

agreements would result in an approximate $387,000 annualized increase or
decrease in interest expense and cash flows. The remaining debt is fixed rate
debt.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

         See Index to Financial Statements on Page F-1 of this Annual Report on
Form 10-A for the financial statements and financial statement schedules.

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

         None.


                                       37

<PAGE>

                                   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.

                             CENTERPOINT PROPERTIES TRUST,
                                   a Maryland business trust

                             By:     /s/ John S. Gates, Jr.
                                   --------------------------------------------
                                   John S. Gates, Jr., President
                                   and Chief Executive Officer
                                   (Principal Executive Officer)

                             By:     /s/ Paul S. Fisher
                                   --------------------------------------------
                                   Paul S. Fisher, Executive Vice
                                   President and Chief Financial Officer
                                   (Principal Financial and Accounting Officer)

         Pursuant to the requirements of the Securities Act of 1934, this report
has been signed by the following persons on behalf of the registrant in the
capacities and on the dates indicated.

SIGNATURE                   NAME AND TITLE                    DATE
---------                   --------------                    ----

/s/ Martin Barber           Martin Barber,                    Dec. 29, 1999
------------------------    Chairman and Trustee


/s/ John S. Gates, Jr.      John S. Gates, Jr., President     Dec. 29, 1999
------------------------    Chief Executive Officer and
                            Trustee

/s/ Robert L. Stovall       Robert L. Stovall,                Dec. 29, 1999
------------------------    Vice Chairman and Trustee


/s/ Nicholas C. Babson      Nicholas C. Babson, Trustee       Dec. 29, 1999
------------------------
/s/ Alan D. Feld            Alan D. Feld, Trustee             Dec. 29, 1999
------------------------
/s/ John J. Kinsella        John J. Kinsella, Trustee         Dec. 29, 1999
------------------------
/s/ Thomas E. Robinson      Thomas E. Robinson, Trustee       Dec. 29, 1999
------------------------
/s/ Norman Bobins           Norman Bobins, Trustee            Dec. 29, 1999
------------------------


                                         38
<PAGE>

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

         Item 10 is incorporated herein pursuant to General Instruction G to
Form 10-K/A by referencing the Company's definitive proxy statement, which will
be filed with the Securities and Exchange Commission pursuant to Regulation 14A
not later than 120 days after the close of the fiscal year.

ITEM 11.  EXECUTIVE COMPENSATION

         Item 11 is incorporated herein pursuant to General Instruction G to
Form 10-K/A by referencing the Company's definitive proxy statement, which will
be filed with the Securities and Exchange Commission pursuant to Regulation 14A
not later than 120 days after the close of the fiscal year.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         Item 12 is incorporated herein pursuant to General Instruction G to
Form 10-K/A by referencing the Company's definitive proxy statement, which will
be filed with the Securities and Exchange Commission pursuant to Regulation 14A
not later than 120 days after the close of the fiscal year.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

         Item 13 is incorporated herein pursuant to General Instruction G to
Form 10-K/A by referencing the Company's definitive proxy statement, which will
be filed with the Securities and Exchange Commission pursuant to Regulation 14A
not later than 120 days after the close of the fiscal year.


                                       39

<PAGE>

                                     PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.

         (a)      The following documents are filed as part of this report:

                  1.       The consolidated financial statements indicated in
                           Part II, Item 8 "Financial Statements and
                           Supplementary Data." See Index to Financial
                           Statements on Page F-1 of this Annual Report on Form
                           10-K/A.

                  2.       The financial statement schedules indicated in Part
                           II, Item 8 "Financial Statements and Supplementary
                           Data." See Index to Financial Statements on Page F-1
                           of this Annual Report on Form 10-K/A.

                  3.       The exhibits listed in part (c) of this Item 14.

         (b)      Reports on Form 8-K filed during the fourth quarter:

                  1.       A Current Report on Form 8-K for October 23, 1998
                           pursuant to Item 5 - "Other Events" announced the
                           Company's filing of supplement to the Company's
                           registration statement on Form S-3, Registration
                           Statement No. 333-49359, with the Securities and
                           Exchange Commission relating to the issuance and sale
                           from time to time of $250,000,000 aggregate principal
                           amount of the Company's Medium Term Notes, Series A.

         (c)      Exhibits

<TABLE>
<CAPTION>
         Exhibit
         Number                             Description
         ------                             -----------
                 <S>          <C>
                 Exhibit 11 - Computation of per share earnings

                 Exhibit 12 - Computation of the ratios of earnings to fixed
                              charges

                 Exhibit 21 - Subsidiaries of the Company

                 Exhibit 23 - Consent of Independent Accountants

                 Exhibit 27 - Financial Data Schedule

                 Exhibit 99 - Press release dated September 28, 1999.


                                       40

<PAGE>

              10.1         Second Amended and Restated Credit Agreement dated as
                           of November 23, 1998 among CenterPoint Properties
                           Trust, the First National Bank of Chicago and Bank of
                           America N.T.S.A.

              10.2         Form of Employment and Severance Agreement between
                           the Company and each of John S. Gates, Jr., Paul S.
                           Fisher, Rockford O. Kottka, Paul T. Ahern and Mike M.
                           Mullen

           ***10.3         Stock Purchase Agreement between the Company and
                           Davis Selected Advisors, L.P.

           ***10.4         CenterPoint Properties Amended and Restated 1993
                           Stock Option Plan, as amended

           ***10.5         First Amendment to the CenterPoint Properties 1995
                           Director Stock Plan

           ***10.6         Stock Option Agreement between the Company and Martin
                           Barber

           ***10.7         Stock Option Agreement between the Company and
                           Nicholas C. Babson

           ***10.8         Stock Option Agreement between the Company and Alan
                           D. Feld

           ***10.9         Stock Option Agreement between the Company and John
                           J. Kinsella

           ***10.10        Stock Option Agreement between the Company and Thomas
                           E. Robinson

           ***10.11        Stock Option Agreement between the Company and Robert
                           L. Stovall

           ***10.12        Stock Option Agreement between the Company and Norman
                           Bobins

                 11        Computation of per share earnings

                 12        Computation of the ratios of earnings to fixed
                           charges

                 21        Subsidiaries of the Company

                 23        Consent of Independent Accountants

                 27        Financial Data Schedule
</TABLE>

--------------
                 *         Incorporated by reference to the Company's
                           Registration Statement on Form S-3 (File No.
                           333-49359)

                **         Incorporated by reference to the Company's
                           Registration Statement on Form S-11 File
                           No. 333-85440)

               ***         Incorporated by reference to the Company's Quarterly
                           Report on Form 10-Q for the fiscal quarter ended June
                           30, 1998

              ****         Incorporated by reference to the Company's Quarterly
                           Report on Form 10-Q for the fiscal quarter ended June
                           30, 1996

             *****         Incorporated by reference to the Company's Quarterly
                           Report on Form 10-Q for the fiscal quarter ended June
                           30, 1995

            ******         Incorporated by reference to the Company's Current
                           Report on Form 8-K dated August 3, 1998

           *******         Incorporated by reference to the Company's Current
                           Report on Form 8-K dated October 23, 1998


                                       41

<PAGE>

                          CENTERPOINT PROPERTIES TRUST
                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
                        AND FINANCIAL STATEMENT SCHEDULES

<TABLE>
<CAPTION>

                                                                                     Page(s)
<S>                                                                               <C>
Consolidated Financial Statements:

         Report of Independent Accountants.....................................        F-2

         Consolidated Balance Sheets as of December 31, 1998 and 1997.........         F-3

         Consolidated Statements of Operations for the years ended
           December 31, 1998, 1997 and 1996...................................         F-4

         Consolidated Statements of Shareholders' Equity for
           the years ended December 31, 1998, 1997 and 1996...................         F-5

         Consolidated Statements of Cash Flows for the years ended
           December 31, 1998, 1997 and 1996...................................         F-6

         Notes to Consolidated Financial Statements...........................     F-7 to F-23

Financial Statement Schedules:

         Report of Independent Accountants....................................        F-24

         Schedule II - Valuation and Qualifying Accounts......................        F-25

         Schedule III - Real Estate and Accumulated Depreciation..............    F-26 to F-31
</TABLE>


                                      F-1

<PAGE>

                        REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and
Shareholders of CenterPoint Properties Trust

In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations, shareholders' equity and cash flows
present fairly, in all material respects, the financial position of CenterPoint
Properties Trust and its subsidiaries at December 31, 1998 and 1997, and the
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1998 in conformity with accounting principles
generally accepted in the United States. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with auditing standards generally
accepted in the United States which require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.

As discussed in Note 2A, the financial statements as of December 31, 1998 and
1997 and for the years then ended have been revised with respect to the timing
of recognition of certain fees and gains.

                                                     PRICEWATERHOUSECOOPERS LLP

Chicago, Illinois
February 9, 1999
except for Note 2A for which the date is November 15, 1999


                                      F-2

<PAGE>

                  CENTERPOINT PROPERTIES TRUST AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                  (IN THOUSANDS, EXCEPT FOR SHARE INFORMATION)

<TABLE>
<CAPTION>

                                     ASSETS

                                                                                           DECEMBER 31,
                                                                                           ------------
                                                                                      1998               1997
                                                                                   REVISED             REVISED
                                                                                   -------             -------
<S>                                                                                 <C>                <C>
Assets:
   Investment in real estate:
     Land and leasehold                                                             $132,270           $124,011
     Buildings                                                                       504,895            418,303
     Building improvements                                                            94,474             64,372
     Furniture, fixtures, and equipment                                               18,817             13,912
     Construction in progress                                                         18,401             41,677
                                                                                    --------           --------
                                                                                     768,857            662,275
     Less accumulated depreciation and amortization                                   62,257             44,352
                                                                                    --------           --------
       Net investment in real estate                                                 706,600            617,923

   Cash and cash equivalents                                                             475              1,652
   Restricted cash and cash equivalents                                               33,056             36,509
   Tenant accounts receivable, net                                                    18,067             12,416
   Mortgage notes receivable                                                             901              9,668
   Investment in and advances to affiliate                                            43,796             11,107
   Prepaid expenses and other assets                                                   4,030              3,119
   Deferred expenses, net                                                             10,681              6,661
                                                                                    --------           --------
                                                                                    $817,606           $699,055
                                                                                    ========           ========

                               LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
   Mortgage notes payable and other debt                                            $103,520            $85,755
   Senior unsecured debt                                                            100,000
   Tax-exempt debt                                                                    75,540             75,540
   Line of credit                                                                     77,600             97,700
   Convertible subordinated debentures payable                                         8,058             11,740
   Preferred dividends payable                                                         1,060                901
   Accounts payable                                                                    7,986             10,311
   Accrued expenses                                                                   31,060             24,593
   Rents received in advance and security deposits                                     5,323              4,759
                                                                                    --------           --------
                                                                                     410,147            311,299
                                                                                    --------           --------
Commitments and contingencies

Shareholders' equity:
   Preferred shares of beneficial interest, $.001 par value, 10,000,000 shares
     authorized; 3,000,000 issued and outstanding, having a liquidation
     preference of $25 per share ($75,000)                                                 3                  3
   Common shares of beneficial interest, $.001 par value, 47,727,273 shares
     authorized; 18,753,474 and 16,891,951 issued and outstanding, respectively           19                 17
   Class B common shares of beneficial interest, $.001 par value, 2,272,727 shares
     authorized; 1,398,088 and 2,272,727 issued and outstanding, respectively              1                  2
   Additional paid-in-capital                                                        449,229            420,743
   Retained earnings (deficit)                                                       (41,497)           (32,512)
   Unearned compensation - restricted shares                                            (296)              (497)
                                                                                    --------           --------
     Total shareholders' equity                                                      407,459            387,756
                                                                                    --------           --------
                                                                                    $817,606           $699,055
                                                                                    ========           ========
</TABLE>

      The accompanying notes are an integral part of these consolidated
financial statements.


                                      F-3

<PAGE>

                  CENTERPOINT PROPERTIES TRUST AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                  (IN THOUSANDS, EXCEPT FOR SHARE INFORMATION)

<TABLE>
<CAPTION>

                                                                            YEARS ENDED DECEMBER 31,
                                                                            ------------------------
                                                                     1998               1997
                                                                    REVISED            REVISED         1996
                                                                   ---------          ---------      ---------
<S>                                                                 <C>               <C>              <C>
Revenue:
   Operating and investment revenue:
     Minimum rents                                                  $77,409           $57,878          $42,107
     Straight-line rents                                              4,030             2,732            2,087
     Expense reimbursements                                          21,924            18,228           11,413
     Mortgage interest income                                         1,061             2,098            1,514
                                                                   ---------          ---------      ---------
       Total operating and investment revenue                       104,424            80,936           57,121
                                                                   ---------          ---------      ---------
   Other revenue:
     Real estate fee income                                           3,657             2,514            5,140
     Equity in net income (loss) of affiliate                          (855)            2,138            1,069
                                                                   ---------          ---------      ---------
       Total other revenue                                            2,802             4,652            6,209
                                                                   ---------          ---------      ---------
       Total revenue                                                107,226            85,588           63,330
                                                                   ---------          ---------      ---------
Expenses:
   Real estate taxes                                                 22,218            17,091           11,868
   Property operating and leasing                                    13,482            12,091            8,883
   General and administrative                                         4,041             3,105            2,567
   Depreciation and amortization                                     21,418            15,278           10,648
   Interest expense:
     Interest incurred, net                                          13,659            10,071            9,865
     Amortization of deferred financing costs                         1,817               800            1,127
                                                                   ---------          ---------      ---------
       Total expenses                                                76,635            58,436           44,958
                                                                   ---------          ---------      ---------
       Operating income                                              30,591            27,152           18,372

Other income (expense):
   Gain on sale of real estate                                        1,672
   Other income (expense)                                               (15)              108             (100)
                                                                   ---------          ---------      ---------
Income before extraordinary item                                     32,248            27,260           18,272

Extraordinary item, early extinguishment of debt                                                        (3,331)
                                                                   ---------          ---------      ---------
Net income                                                           32,248            27,260           14,941

   Preferred dividends                                               (6,360)             (901)            (947)
                                                                   ---------          ---------      ---------
Net income available to common shareholders                         $25,888           $26,359          $13,994
                                                                   =========          =========      =========

Per share net income available to common shareholders
   before extraordinary item:
     Basic                                                            $1.30             $1.41            $1.25
     Diluted                                                          $1.29             $1.39            $1.22

Per share net income available to common shareholders:
     Basic                                                            $1.30             $1.41            $1.01
     Diluted                                                          $1.29             $1.39            $0.99

Distributions per common share                                        $1.75             $1.68            $1.62
</TABLE>

      The accompanying notes are an integral part of these consolidated
financial statements.


                                      F-4

<PAGE>

                  CENTERPOINT PROPERTIES TRUST AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                  (IN THOUSANDS, EXCEPT FOR SHARE INFORMATION)

<TABLE>
<CAPTION>

                                                                   CLASS B COMMON
                                              PREFERRED SHARES         SHARES         COMMON SHARES
                                              ----------------    -----------------  ----------------
                                               NUMBER              NUMBER             NUMBER
                                              OF SHARES  AMOUNT   OF SHARES  AMOUNT  OF SHARES AMOUNT
                                              ---------  ------   ---------  ------  --------- ------
<S>                                           <C>        <C>      <C>        <C>     <C>       <C>
Balance, January 1, 1996                      2,272,727      $2           0    $0    10,358,958   $10
Issuance of common shares,
  less $2,387 of offering costs                                                       3,450,000     3
Conversion of convertible preferred shares
  to Class B common shares                   (2,272,727)     (2)  2,272,727     2
Conversion of convertible subordinated
  debentures to common shares                                                           485,680     1
Shares issued for stock options exercised                                                27,787
Incentive share awards                                                                    8,290
Director share awards                                                                     2,516
Amortization of unearned compensation
Distributions declared on common shares,
  $1.62 per share
Distributions declared on convertible
  preferred shares,  $0.42 per share
Distributions declared on Class B common
  shares, $1.25 per share
Net income
                                              ---------  ------   ---------  ----     ----------  ----
Balance, December 31, 1996                            0       0   2,272,727     2    14,333,231    14
Issuance of common shares,
  less $4,054 of offering costs                                                       2,250,000     2
Issuance of preferred shares,
  less $3,101 of offering costs               3,000,000       3
Conversion of convertible subordinated
  debentures to common shares                                                           144,640
Shares issued for stock options exercised                                               149,715     1
Incentive share awards                                                                   12,444
Director share awards                                                                     1,921
Amortization of unearned compensation
Distributions declared on common shares,
  $1.68 per share
Distributions declared on preferred shares,
  $0.30 per share
Distributions declared on Class B common
  shares, $1.73 per share
Net income as revised
                                              ---------  ------   ---------  ----    ----------  ----
Balance, December 31, 1997                    3,000,000       3   2,272,727     2    16,891,951    17
Issuance of common shares,
  less $343 of offering costs                                                           740,371     1
Conversion of Class B common shares to
  common shares                                                    (874,639)   (1)      874,639
Conversion of convertible subordinated
  debentures to common shares                                                           201,748
Shares issued for stock options exercised                                                42,461
Director share awards                                                                     2,304
Amortization of unearned compensation
Distributions declared on common shares,
  $1.75 per share
Distributions declared on preferred shares,
  $2.12 per share
Distributions declared on Class B common
  shares, $1.80 per share
Net income as revised
                                              ---------  ------   ---------  ----    ----------  ----
Balance, December 31, 1998                    3,000,000      $3   1,398,088    $1    18,753,474   $19
                                              =========  ======   =========  ====    ==========  ====

<CAPTION>

                                                                      UNEARNED
                                              ADDITIONAL    RETAINED COMPENSATION-     TOTAL
                                                PAID-IN     EARNINGS RESTRICTED    SHAREHOLDERS'
                                                 CAPITAL    (DEFICIT)   SHARES        EQUITY
<S>                                             <C>         <C>          <C>       <C>
Balance, January 1, 1996                        $187,161    ($18,602)    ($251)      $168,320
Issuance of common shares,
  less $2,387 of offering costs                   79,547                               79,550
Conversion of convertible preferred shares
  to Class B common shares
Conversion of convertible subordinated
  debentures to common shares                      8,683                                8,684
Shares issued for stock options exercised            508                                  508
Incentive share awards                               186                  (186)
Director share awards                                 57                                   57
Amortization of unearned compensation                                      118            118
Distributions declared on common shares,
  $1.62 per share                                            (20,277)                 (20,277)
Distributions declared on convertible
  preferred shares,  $0.42 per share                            (947)                    (947)
Distributions declared on Class B common
  shares, $1.25 per share                                     (2,841)                  (2,841)
Net income                                                    14,941                   14,941
                                                 -------     -------     -----       --------
Balance, December 31, 1996                       276,142     (27,726)     (319)       248,113
Issuance of common shares,
  less $4,054 of offering costs                   66,819                               66,821
Issuance of preferred shares,
  less $3,101 of offering costs                   71,896                               71,899
Conversion of convertible subordinated
  debentures to common shares                      2,564                                2,564
Shares issued for stock options exercised          2,873                                2,874
Incentive share awards                               392                  (392)
Director share awards                                 57                                   57
Amortization of unearned compensation                                      214            214
Distributions declared on common shares,
  $1.68 per share                                            (27,221)                 (27,221)
Distributions declared on preferred shares,
  $0.30 per share                                               (901)                    (901)
Distributions declared on Class B common
  shares, $1.73 per share                                     (3,924)                  (3,924)
Net income as revised                                          27260                   27,260
                                                 -------     -------     -----       --------
Balance, December 31, 1997                       420,743      (32512)     (497)        387756
Issuance of common shares,
  less $343 of offering costs                     23,880                               23,881
Conversion of Class B common shares to
  common shares
Conversion of convertible subordinated
  debentures to common shares                      3,644                                3,644
Shares issued for stock options exercised            882                                  882
Director share awards                                 80                                   80
Amortization of unearned compensation                                      201            201
Distributions declared on common shares,
  $1.75 per share                                            (31,182)                 (31,182)
Distributions declared on preferred shares,
  $2.12 per share                                             (6,360)                  (6,360)
Distributions declared on Class B common
  shares, $1.80 per share                                     (3,691)                  (3,691)
Net income as revised                                         32,248                   32,248
                                                 -------     -------     -----       --------
Balance, December 31, 1998                      $449,229    ($41,497)    ($296)      $407,459
                                                ========    =========    =====       ========
</TABLE>


         The accompanying notes are an integral part of these consolidated
financial statements.


                                      F-5

<PAGE>

                  CENTERPOINT PROPERTIES TRUST AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>

                                                                               YEARS ENDED DECEMBER 31,
                                                                               ------------------------
                                                                       1998                  1997
                                                                    REVISED               REVISED              1996
                                                                    -------               -------              ----
<S>                                                                <C>                  <C>                <C>
Cash flows from operating activities:
     Net income                                                     $32,248              $27,260            $14,941
     Adjustments to reconcile net income to net
     cash provided by operating activities:
         Extraordinary item-early extinguishment of debt                                                      3,331
         Bad debts                                                      550                  279                462
         Depreciation                                                20,081               14,275             10,199
         Amortization of deferred financing costs                     1,817                  800              1,127
         Other amortization                                           1,337                1,003                449
         Straight-line rents                                         (4,030)              (2,732)            (2,087)
         Incentive stock awards                                         281                  271                175
         Interest on converted debentures                                44                   12                 77
         Equity in net (income) loss of affiliate                       855               (2,138)            (1,069)
         (Gain) loss on disposal of real estate                      (1,672)                (140)                60
         Net changes in:
             Tenant accounts receivable                              (1,604)                (973)               197
             Prepaid expenses and other assets                        1,107                  (21)              (937)
             Rents received in advance and security deposits            623                  317                590
             Accounts payable and accrued expenses                    6,167                1,198              2,037
                                                                   ---------           ----------          ---------
Net cash provided by operating activities                            57,804               39,411             29,552
                                                                   ---------           ----------          ---------
Cash flows from investing activities:
     Change in restricted cash and cash equivalents                   3,746              (35,532)               325
     Acquisition of real estate                                     (69,700)            (122,090)           (85,268)
     Construction in progress                                       (23,756)             (42,311)           (17,063)
     Improvements and additions to properties                       (27,038)             (42,441)           (12,575)
     Disposition of real estate                                      33,948               13,510             18,991
     Change in deposits on acquisitions                              (2,081)               1,303              1,037
     Issuance of mortgage notes receivable                          (17,462)                                (18,523)
     Repayment of mortgage notes receivable                          24,392                5,670              5,543
     Investment in and advances to affiliate                        (33,543)             (19,639)            (1,048)
     Receivables from affiliates and employees                           62                   (3)               106
     Additions to deferred expenses                                  (7,274)              (3,803)            (3,079)
                                                                   ---------           ----------          ---------
Net cash used in investing activities                              (118,706)             (245336)          (111,554)
                                                                   ---------           ----------          ---------
Cash flows from financing activities:
     Proceeds from sale of preferred shares                                               75,000
     Proceeds from sale of common shares                             25,106               73,749             82,445
     Offering costs paid                                               (343)              (7,155)            (2,387)
     Proceeds from issuance of unsecured bonds                      100,000
     Proceeds from issuance of line of credit                       132,000              211,650             46,100
     Repayment of line of credit                                   (152,100)            (160,050)
     Proceeds from issuance of bonds payable                                              55,000             45,882
     Repayments of mortgage notes payable                            (3,831)              (8,156)           (62,705)
     Repayments of notes payable                                        (33)              (2,385)              (123)
     Distributions                                                  (41,074)             (31,145)           (29,017)
     Conversion of convertible subordinated
      debentures payable                                                                      (1)                (1)
                                                                   ---------           ----------          ---------
Net cash provided by financing activities                            59,725              206,507             80,194
                                                                   ---------           ----------          ---------
Net change in cash and cash equivalents                              (1,177)                 582             (1,808)
Cash and cash equivalents, beginning of year                          1,652                1,070              2,878
                                                                   ---------           ----------          ---------
Cash and cash equivalents, end of year                                 $475               $1,652             $1,070
                                                                   =========           ==========          =========
</TABLE>

         The accompanying notes are an integral part of these consolidated
financial statements


                                      F-6
<PAGE>

                  CENTERPOINT PROPERTIES TRUST AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER SHARE DATA)

1.       ORGANIZATION

         CenterPoint Properties Trust (the "Company"), a Maryland trust, and
its subsidiaries, owns and operates primarily warehouse/industrial properties
in the metropolitan Chicago area and operates as a real estate investment
trust.

         On October 15, 1997, the Company completed a reorganization pursuant
to which it converted from a Maryland corporation to a Maryland real estate
investment trust by means of a merger of CenterPoint Properties Corporation
(the "Corporation") with and into the Company, which prior to the merger was
a wholly-owned subsidiary of the Corporation, with the Company as the
surviving entity. Pursuant to a Plan of Reorganization, which was approved by
the stockholders of the Corporation at a Special Meeting of Stockholders held
on October 1, 1997, each issued and outstanding share of common stock of the
corporation, par value $.001 per share (the "Common Stock"), was converted
into one common share of beneficial interest in the Company, par value $.001
per share (the "Common Shares"), each outstanding share of Class B common
stock of the Corporation was converted into one Class B common share of
beneficial interest (the "Class B Common Shares") in the Company; and the
outstanding principal amount of the Corporation's 8.22% Convertible
Subordinated Debentures due 2004 was assumed by the Company and converted
into the same principal amount of 8.22% Convertible Subordinated Debentures
due 2004 of the Company.

         In June, 1997, the FASB issued SFAS Statement No. 131, "Disclosures
about Segments of an Enterprise and Related Information." This statement,
effective for financial statements for fiscal years beginning after December
15, 1997, requires that a public business enterprise report financial and
descriptive information about its reportable operating segments. Generally,
financial information is required to be reported on the basis that it is used
internally for evaluating segment performance and deciding how to allocate
resources to segments. Based on this criteria, the Company has determined
that it operates in one business segment, that being the development,
management and ownership of warehouse/industrial property located in Greater
Chicago. Thus, all information required by SFAS No. 131 is included in the
Company's financial statements. No single tenant represented more than 10% of
consolidated minimum rents in 1998, 1997 and 1996.

2A.      REVISION

During the third quarter of 1999, the Company determined that it had
recognized certain participation, assignment, consulting and financing fees
in 1998 and 1997 in advance of that permitted and has revised previously
issued financial statements accordingly. In addition, the Company revised
previously issued financial statements to recognize, for financial reporting
purposes, certain gains in connection with tax-deferred exchanges that had
not been previously recognized. The financial statement revisions effect only
the timing of fee revenue and HAVE NO EFFECT ON PREVIOUSLY REPORTED CASH FLOW
or on the total fee revenue to be recognized.

The effect of this revised reporting on the Company's condensed balance
sheets, condensed statements of operations, net income and earnings per share
is as follows (1996 was not affected):

                                      F-7
<PAGE>

<TABLE>
<CAPTION>
                                                                       1998                        1997
                                                                       ----                        ----

                                                               Previously          As       Previously        As
                                                                Reported        Revised      Reported       Revised
                                                                --------        -------      --------       -------
<S>                                                              <C>            <C>         <C>           <C>
Condensed Balance Sheets:

     Investment in real estate, net                              $685,476       $706,600    $597,294      $617,923
     Mortgage notes receivable                                     20,353            901      30,297         9,668
     Other assets                                                 116,107        110,105      71,684        71,464
                                                                 --------       --------    --------      --------
         Total assets                                            $821,936       $817,606    $699,275      $699,055
                                                                 ========       ========    ========      ========

     Long term debt                                              $364,718       $364,718    $270,735       270,735
     Other liabilities                                             45,179         45,429      40,414        40,564
     Shareholders' equity                                         412,039        407,459     388,126       387,756
                                                                 --------       --------    --------      --------
         Total liabilities and
               Shareholders' equity                              $821,936       $817,606    $699,275      $699,055
                                                                 ========       ========    ========      ========

Condensed Statement of Operations:
     Operating and investment revenue                             104,290        104,424      80,625        80,936
     Other revenue                                                  8,818          2,802       5,333         4,652
                                                                 --------       --------    --------      --------
         Total revenue                                            113,108        107,226      85,958        85,588
     Operating expenses                                           (76,635)       (76,635)    (58,436)      (58,436)
     Other income (expense)                                           (15)         1,657         108           108
                                                                 --------       --------    --------      --------

Net income                                                        $36,458        $32,248     $27,630       $27,260
                                                                 ========       ========    ========      ========

Net income available to common shareholders per share:
Net income per share- basic                                      $   1.51       $   1.30    $   1.43      $   1.41
Net income per share- diluted                                    $   1.50       $   1.29    $   1.41      $   1.39
</TABLE>


2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         REVENUE RECOGNITION

         Minimum rents are recognized on a straight-line basis over the terms of
the respective leases. Unbilled rents receivable represents the amount that
straight-line rental revenue exceeds rents due under the lease agreements.
Unbilled rents receivable, included in tenants accounts receivable, at December
31, 1998 and 1997 were $8,530 and $5,075, respectively. Recoveries from tenants
for taxes, insurance and other property operating expenses are recognized in the
period the applicable costs are incurred.

         Real estate fee income includes tenant lease termination fees of $1,770
in 1998, $1,894 in 1997 and $1,200 in 1996.


         The Company provides an allowance for doubtful accounts against the
portion of accounts receivable which is estimated to be uncollectible. Accounts
receivable in the consolidated balance sheets are shown net of an allowance for
doubtful accounts of $575 and $272 as of December 31, 1998 and 1997,
respectively.


                                      F-8

<PAGE>

         DEFERRED EXPENSES

         Deferred expenses consist principally of financing fees and leasing
commissions. Leasing commissions are amortized on a straight-line basis over the
terms of the respective lease agreements ranging from 1 to 15 years. Financing
costs are amortized over the terms of the respective loan agreements. Deferred
expenses relating to debenture conversions of $82 and $86 were charged to
paid-in capital in 1998 and 1997, respectively, and fully amortized deferred
expenses of $1,562 and $1,207 were written off in 1998 and 1997, respectively.
Also, in 1998 the Company disposed of properties and deferred leasing and other
costs of $94 were written off.

         The balances are as follows:

<TABLE>
<CAPTION>
                                                                                       DECEMBER 31,
                                                                                       ------------
                                                                                  1998             1997
                                                                                -------           ------
<S>                                                                             <C>              <C>
              Deferred financing costs, net of accumulated
                 amortization of $1,893 and $1,081                               $4,601           $2,766
              Deferred leasing and other costs, net of accumulated
                 amortization of $2,127 and $1,478                                6,080            3,895
                                                                                -------           ------
                                                                                $10,681           $6,661
                                                                                =======           ======
</TABLE>


         PROPERTIES

         Real estate assets are stated at cost. Interest and real estate taxes
and other directly related expenses incurred during construction periods are
capitalized and amortized on the same basis as the related assets. Depreciation
expense is computed using the straight-line method based upon the following
estimated useful lives:

<TABLE>
<CAPTION>
                                                                     YEARS
                                                                     -----
         <S>                                                      <C>

         Building and improvements                                31.5 and 40
         Land improvements                                        15
         Furniture, fixtures and equipment                        4 to 15
</TABLE>

         Construction allowances for tenant improvements are capitalized and
amortized over the terms of each specific lease. Repairs and maintenance are
charged to expense when incurred. Expenditures for improvements are capitalized.
When assets are sold or retired, their cost and related accumulated depreciation
are removed from the accounts. The resulting gains or losses for taxable
dispositions of properties are reflected in operations. However, no gain or loss
is recognized for transactions that qualify as tax-free exchanges of properties.

         The Company annually reviews the recoverability of the carrying value
of its investment in real estate. The reviews are conducted by estimating the
fair value of its properties generally by analysis and comparison of the
capitalized values of the expected net operating cash flows of the properties.
If management determines that an impairment of a property has occurred, the
carrying value of such property will be reduced to its fair value.

         CASH AND CASH EQUIVALENTS

         For purposes of the consolidated financial statements, the Company
considers all investments purchased with original maturities of three months or
less to be cash equivalents.


                                      F-9

<PAGE>

         INVESTMENT IN AND ADVANCES TO AFFILIATE

         The Company accounts for its investment in affiliate using the equity
method whereby its cost of the investment is adjusted for its share of equity in
net income or loss from the date of acquisition and reduced by distributions
received.

         ESTIMATES

         The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

         INCOME TAXES

         The Company qualifies as a real estate investment trust ("REIT") under
sections 856-860 of the Internal Revenue Code beginning January 1, 1994. In
order to qualify as a REIT, the Company is required to distribute at least 95%
of its taxable income to shareholders and to meet certain asset and income tests
as well as certain other requirements. As a REIT, the Company will generally not
be liable for Federal income taxes, provided it satisfies the necessary
distribution requirements. The distributions declared and paid for the years
ended December 31, 1998, 1997 and 1996 include a return of capital of
approximately 9%, 12% and 51%, respectively.

         EARNINGS PER COMMON SHARE

         Following are the reconciliations of the numerators and denominators
for computing basic and diluted earnings per share ("EPS") data:

<TABLE>
<CAPTION>
                                                                               YEARS ENDED DECEMBER 31,
                                                                               ------------------------
                                                                     1998              1997             1996
                                                                 ----------         ----------       ----------
<S>                                                              <C>                <C>              <C>
Numerators:
    Income before extraordinary items                               $32,248            $27,260          $18,272
       Dividends on preferred shares                                 (6,360)              (901)
       Dividends on convertible preferred stock                                                            (947)
                                                                 ----------         ----------       ----------

       Income available to common shareholders
          before extraordinary item - for basic and diluted EPS      25,888             26,359           17,325
       Extraordinary items                                                                               (3,331)
                                                                 ----------         ----------       ----------

    Net income available to common shareholders - for
       basic and diluted EPS                                        $25,888            $26,359          $13,994
                                                                 ==========         ==========       ==========

Denominators:

    Weighted average common shares outstanding - for
          basic EPS                                              19,867,509         18,634,850       13,890,049
       Effect of dilutive securities - options                      234,428            312,280          285,913
                                                                 ----------         ----------       ----------
    Weighted average common shares outstanding - for
          diluted EPS                                            20,101,937         18,947,130       14,175,962
                                                                 ==========         ==========       ==========
</TABLE>


                                      F-10

<PAGE>

         The assumed conversion of the convertible subordinated debentures into
common shares for purposes of computing diluted EPS by adding interest expense
for the debentures to the numerators and adding assumed share conversions to the
denominators for 1998, 1997 and 1996 would be anti-dilutive. The assumed
conversion of the convertible preferred stock in 1996 would also be
anti-dilutive.


         RECLASSIFICATIONS

         Certain items presented in the consolidated statements of operations
for prior periods have been reclassified to conform with current classifications
with no effect on results of operations.


         ACCOUNTING PRONOUNCEMENTS

         In June, 1997, the FASB issued SFAS Statement No. 130, "Reporting
Comprehensive Income." This statement, effective for periods beginning after
December 15, 1997, requires the Company to report components of comprehensive
income in a financial statement that is displayed with the same prominence as
other financial statements. Comprehensive income is defined by Concepts
Statement No. 6, "Elements of Financial Statements" as the change in equity of a
business enterprise during a period from transactions and other events and
circumstances from nonowner sources. It includes all changes in equity during
the period except those resulting from investment by owners and distributions to
owners. As required by this statement, the Company adopted the new standard for
reporting comprehensive income. The Company's net income is equal to
comprehensive income.

         In March, 1998, the FASB's Emerging Issues Task Force ("EITF") issued
EITF Issue No. 97-11, "Accounting for Internal Costs Related to Real Estate
Acquisitions." This statement, effective as of March 19, 1998, requires that
internal costs of identifying and acquiring operating properties should be
expensed as incurred. Prior to March 19, 1998, the Company capitalized internal
preacquisition costs. The adoption of this EITF has not had a significant impact
on the results of current operations and the Company estimates this EITF will
not have a significant impact on the results of operations in the future.

         In May, 1998, the FASB issued SFAS Statement No. 133, "Accounting for
Derivative Instruments and Hedging Activities." This statement, effective for
financial statements for fiscal years beginning after June 15, 1999, provides a
comprehensive and consistent standard for the recognition and measurement of
derivatives and hedging activities. The Company has disclosed its only
derivative position within the Long Term Debt note.

3.       PROPERTY ACQUISITIONS AND DISPOSITIONS

         During each of the years ended December 31, 1998, 1997 and 1996, the
Company acquired thirty, twenty-one and fifteen properties, respectively,
consisting principally of single-tenant buildings for an aggregate amount of
approximately $91,692, $124,923 and $103,532, respectively. Fifteen of the
properties in 1998 were acquired as a portfolio from an unrelated third
party. All of the remaining property acquisitions were closed in singular
transactions, and except for one transaction in 1998, one transaction in 1997
and three transactions in 1996, were acquired from unrelated third parties.
The properties were funded with borrowings under the Company's lines of
credit, proceeds from properties sold during 1998, 1997 and 1996, and from
proceeds of public offerings of the Company's common shares completed in
1998, 1997 and 1996, and from proceeds of a


                                      F-11

<PAGE>

public offering of the Company's preferred shares completed in 1997. The
acquisitions have been accounted for utilizing the purchase method of
accounting, and accordingly, the results of operations of the acquired
properties are included in the consolidated statements of operations from the
dates of acquisition.

         The Company disposed of six properties during the 1998, three
properties during 1997 and eight properties during 1996.

         Due to the effect of the March, 1997 common offering, the November,
1997 preferred offering, the May and April, 1998 common offerings and the
acquisitions and dispositions of properties, the historical results are not
indicative of the future results of operations. The following 1996 unaudited pro
forma information is presented as if the 1996 and 1997 acquisitions and
dispositions of properties, the 1997 and 1996 offerings, and the corresponding
repayment of certain debt had occurred on January 1, 1996. The 1997 and 1998
unaudited proforma information is presented as if the 1998 and 1997 offerings,
the corresponding repayment of certain debt, and the 1998 and 1997 acquisitions
and dispositions had all occurred on January 1, 1997. The unaudited pro forma
information is based upon the historical consolidated statements of operations
before any extraordinary items and does not purport to present what actual
results would have been had the transactions, in fact, occurred at the beginning
of 1997 or 1996, or to project results for any future period.

<TABLE>
<CAPTION>
                                                                               PROFORMA FOR THE YEARS
                                                                               ----------------------
                                                                           ENDED DECEMBER 31, (UNAUDITED)
                                                                           ------------------------------
                                                                     1998              1997             1996
                                                                     ----              ----             ----

<S>                                                                <C>                <C>             <C>
         Total revenues                                            $107,106           $ 95,607        $ 80,294
         Total expenses                                              79,882             61,983          50,103
                                                                   --------           ---------       --------
         Income before extraordinary item                            27,224             33,624          30,191
         Preferred dividends                                         (6,360)            (6,360)         (7,307)
                                                                   --------           ---------       --------
         Income available to common shareholders
             before extraordinary item                             $ 20,864           $ 27,264        $ 22,884
                                                                   ========           ========        ========

         Per share income available to common shareholders
             before extraordinary item:
                Basic                                                 $1.04              $1.37           $1.28
                Diluted                                               $1.03              $1.35           $1.26
</TABLE>


4.       MORTGAGE NOTES RECEIVABLE

         As of December 31, 1998, the Company had a mortgage loan receivable
outstanding of $901, bearing interest at a rate of 10.50% and maturing in June,
2010. As of December 31, 1997, the Company had mortgage loans receivable
outstanding of $9,668, bearing interest at rates ranging from 8.5% to
10.5%.Certain notes require payment of interest and principle monthly. As of
December 31, 1998, the note matures as follows:

<TABLE>
<S>                                                           <C>
         1999..............................................   $ 24
         2000..............................................    258
         2001..............................................     84
         2002..............................................     88
         2003..............................................     91
         Thereafter........................................    356
                                                              ----
                  Total....................................   $901
                                                              ====
</TABLE>


                                      F-12

<PAGE>

         Based on borrowing rates available at the end of 1998 and 1997 for
mortgage loans with similar terms and maturities, the fair value of the mortgage
notes receivable approximates the carrying values.

         Land and buildings have been pledged as collateral for the above notes
receivable.

5.       INVESTMENT IN AND ADVANCES TO AFFILIATE

         The Company holds approximately 99% of the economic interest in
CenterPoint Realty Services Corporation ("CRS"). To maintain compliance with
limitations on income from business activities received by REITs and their
qualified REIT subsidiaries, the Company holds its interest in CRS in the form
of non-voting equity ownership which qualifies as an unconsolidated taxable
subsidiary.

         As of December 31, 1998 and 1997, the Company had an outstanding
balance due from CRS of $41,379 and $7,868, respectively, under a series of
demand loans with interest rates ranging from 8.0% to 11.1%.The proceeds of the
loans were required for development projects.

         Certain revisions to the Company's previously issued financial
statements described in Note 2A are derived from revisions to the 1998 and 1997
financial statements of CRS. Accordingly, the summarized financial information
of CRS as of December 31, 1998 and 1997 and for the years then ended (shown
below) have been revised.

         Summarized financial information of CRS is shown below.

Balance Sheets:
<TABLE>
<CAPTION>
                                                                           DECEMBER 31,
                                                                           ------------
                                                                     1998            1997
                                                                   REVISED          REVISED
                                                                   -------          -------
<S>                                                                <C>              <C>
Assets:
     Investment in land and real estate under development          $48,270          $11,140
     Notes receivable                                                                    59
     Other assets                                                    4,644              832
                                                                   -------          -------
                                                                   $52,914          $12,031
                                                                   =======          =======

Liabilities:
     Note payable to affiliate                                     $41,379           $7,868
     Due to affiliate                                                   33
     Other liabilities                                               9,187              929
                                                                   -------          -------
                                                                    50,599            8,797

Stockholder's equity                                                 2,315            3,234
                                                                   -------          -------
                                                                   $52,914          $12,031
                                                                   =======          =======
</TABLE>


Statements of Operations:

<TABLE>
<CAPTION>
                                                        YEARS ENDED DECEMBER 31,
                                                        ------------------------
                                                 1998            1997
                                                REVISED        REVISED          1996
                                                -------        -------          ----
<S>                                             <C>            <C>             <C>
Total Income                                     $4,823         $40,092        $16,000
Operating Expenses                               (6,282)        (36,627)       (14,261)

                                      F-13

<PAGE>

Benefit (provision) for income taxes                595          (1,305)          (659)
                                               ---------      ---------       --------

     Net income (loss)                          $  (864)       $  2,160         $1,080
                                               =========      =========       ========
</TABLE>

                                      F-14

<PAGE>

6.   LONG TERM DEBT

         The long-term debt as of December 31, 1998 and 1997 consist of the
following:

<TABLE>
<CAPTION>
                                         CARRYING AMOUNT OF                 PERIODIC        ESTIMATED        FINAL
     PROPERTY PLEDGED AS                 NOTES DECEMBER 31,     INTEREST    PAYMENT     BALLOON PAYMENT     MATURITY
          COLLATERAL                     1998          1997       RATE       TERMS        AT MATURITY         DATE
          ----------                     ----          ----       ----       -----        -----------         ----
<S>                                  <C>           <C>           <C>       <C>                 <C>          <C>

MORTGAGE NOTES PAYABLE AND
OTHER DEBT:
Designated pool of 20
   properties                         $50,000       $50,000       7.62%     $318(a)             $50,000     11/1/02
Designated pool of 18
   properties                          30,000        30,000       6.91%      173(a)              30,000     5/15/99
850 Arthur Avenue
   Elk Grove Village, IL                  575           575       8.00%       12(b)                 575     10/3/00
11801 South Central
   Alsip, IL                            4,901                     7.35%       49(c)                          1/1/12
2553 N. Edgington Avenue
   Franklin Park, IL (d)                              3,500         (e)
Designated pool of  11
   properties                           8,985                     8.81%      114(c)               8,484      1/1/00
Designated pool of  2
   properties                           4,108                     9.21%       45(c)               3,936      1/1/00
Designated pool of  2
   properties                           2,261                     7.71%       21(c)               2,181      1/1/00
440 N. Lake Street
   Miller, IN                           1,680         1,680         (f)         (a)               1,680      3/1/31

Capitalized lease obligation            1,010                     7.00%       19(c)                 101     12/1/03
                                     --------      --------
                                      103,520        85,755
                                     --------      --------

SENIOR UNSECURED DEBT:
Bonds Payable                         100,000                     6.75%         (g)             100,000      4/1/05
                                     --------      --------

TAX EXEMPT DEBT:
City of Chicago Revenue Bonds          55,000        55,000         (h)         (a)              55,000      9/8/32
440 N. Lake Street
  Miller, IN                           20,540        20,540         (f)         (a)              20,540      3/1/31
                                     --------      --------
                                       75,540        75,540
                                     --------      --------

LINE OF CREDIT:
Revolving line of credit               77,600        97,700         (i)         (a)                        10/24/01
                                     --------      --------

Total long term debt                 $356,660      $258,995
                                     ========      ========
</TABLE>


                                      F-15

<PAGE>

---------------------------

(a)      The note requires monthly payments of interest only.
(b)      The note requires quarterly payments of interest only.
(c)      Amount represents the monthly payment of principal and interest.
(d)      In November, 1998, the Company repaid the outstanding amount upon
         maturity.
(e)      The interest rate is one month LIBOR plus 1.75% (6.9% at December 31,
         1997).
(f)      These revenue bonds consist of two series ($1,680 taxable and $20,540
         tax-exempt) of Economic Development Revenue Bonds issued in April,
         1996 by the City of Gary, Indiana. $1,680 of the bonds are
         collateralized by a letter of credit which contains certain financial
         covenants pertaining to the tangible net worth and liabilities in
         relation to portfolio value of the Company. The bonds bear interest
         based on the Weekly Adjustable Interest Rate Mode at a rate determined
         by the Remarketing Agent (5.15% and 6.1% on the taxable bonds and 4.1%
         and 4.2% on the tax exempt bonds at December 31, 1998 and 1997,
         respectively).
(g)      The note requires semi-annual payments of interest only.
(h)      These Variable/Fixed Rate Demand Special Facilities Airport Revenue
         Bonds issued by the City of Chicago, Illinois are enhanced by a letter
         of credit. The letter of credit contains certain financial covenants
         pertaining to consolidated net worth. The tax-exempt bonds bear
         initial interest at a Weekly Adjustable Interest Rate, which from time
         to time may be changed by the Company, at a rate determined by the
         Remarketing Agent (4.2% and 3.95% at December 31, 1998 and 1997,
         respectively). The bonds require monthly payments of interest only and
         mature in September, 2032. Of the original proceeds, the Company holds
         $30,447 and $34,593 in escrow at December 31, 1998 and 1997,
         respectively, for future construction costs.
(i)      In October, 1996, the Company obtained a $135,000 unsecured line of
         credit, and increased the line in November 1997 and November 1998 to
         $150 million and $250 million, respectively. The interest rate at
         December 31, 1998 is 6.1125% (LIBOR plus 1.0%) for LIBOR borrowings
         and Prime Rate (7.75%) for other borrowings. As of December 31, 1997,
         the interest rate range from 6.8% to 6.863% (LIBOR plus 0.80%) for
         LIBOR borrowings and Prime Rate (8.5%) for other borrowings. The
         Company may receive competitive bids for up to half its commitment.
         The line requires payments of interest only when LIBOR contracts
         mature and monthly on borrowings under Prime Rate. There is a
         commitment fee of $300 per year. At December 31, 1998 and 1997, the
         Company had $172,400 and $52,300, respectively, available under the
         line.

         As of December 31, 1998 mortgage notes, other debt, senior unsecured
debt, tax-exempt debt and line of credit mature as follows:

<TABLE>
         <S>                                                        <C>
         1999.....................................................  $ 31,141
         2000.....................................................    15,595
         2001.....................................................    78,049
         2002.....................................................    50,483
         2003.....................................................       620
         Thereafter...............................................   180,772
                                                                    --------
                  Total...........................................  $356,660
                                                                    ========
</TABLE>

         Based on borrowing rates available to the Company at the end of 1998
and 1997 for mortgage loans with similar terms and maturities, the fair value of
the mortgage notes payable approximates the carrying values.

         On September 10, 1998, the Company entered into an interest rate
protection agreement to lock into a fixed interest rate on an anticipated
refinancing of mortgage notes payable with a notional amount of $25,000.


                                      F-16

<PAGE>


The agreement provides that the Company will either receive or pay an
amount equal to the spread between a locked in treasury rate (4.835%) and the
interest rate on treasury securities underlying the agreement as of the
determination date. The determination date is to be triggered by the Company
before May 17, 1999. If not triggered, the agreement will be settled on May 17,
1999 based on interest rates effective at the time. If settlement of the
agreement had been triggered at December 31, 1998 the Company would have had to
pay $365. The Company plans that ultimate receipt or payment made upon
settlement of the agreement will be reflected as an adjustment to interest
expense on the related refinancing.

         Land, buildings and equipment related to such mortgages with an
aggregate net book value of approximately $212,168 at December 31, 1998 have
been pledged as collateral for the above debt.


7.       EXTRAORDINARY ITEM

         In 1996, the Company incurred a loss of $3,331 (per share - basic
$0.24; diluted $0.23), representing a write off of unamortized deferred
financing costs as a result of early extinguishment of certain debt obligations.


8.       CONVERTIBLE SUBORDINATED DEBENTURES PAYABLE

         Concurrent with the initial public offering in December, 1993, the
Company issued $58,500 of convertible subordinated debentures ("Debentures") due
2004. At December 31, 1998 and 1997, $8,058 and $11,740 of debentures were
outstanding, respectively. The Debentures are unsecured general obligations of
the Company and are subordinate to all existing and subsequently incurred
indebtedness of the Company. The Debentures are optionally redeemable by the
Company, at par, commencing December 4, 1998. Holders may convert the Debentures
at any time, without premium, to Common Shares of the Company at a conversion
price of $18.25 per share, subject to certain adjustments. The Debentures bear
interest at 8.22% per annum, payable semiannually on January 15 and July 15 of
each year, commencing July 15, 1994. During 1998, 1997 and 1996 debentures
totaling $3,682, $2,640 and $8,864, respectively, were converted into shares of
common stock. Based principally on the conversion feature and share price of
common stock at the end of 1998 and 1997, the fair value of the outstanding
Debentures approximates $14,929 and $22,595, respectively.


9.       RELATED PARTY TRANSACTIONS

         In May, 1998 and December, 1997, the Company purchased a fully leased
building, located in Wood Dale, Illinois and Des Plaines, Illinois,
respectively, from partnerships, in which one of the Company's Senior Officers
and a Company Director were limited partners. The two properties were purchased
for approximately $3.3 million and $4.7 million, respectively. In June, 1996,
the Company acquired three properties in which the Company's Chief Operations
Officer and Director, and the Company's Executive Vice President of Acquisitions
during 1996 had an interest and, in which they, continue to own an insignificant
interest in two of the properties. The three properties were purchased for an
aggregate amount of approximately $24.6 million. The above transactions
satisfied the Company's investment criteria and were approved by the Company's
independent directors.


10.      SHAREHOLDERS' EQUITY


                                      F-17
<PAGE>

         COMMON SHARES OF BENEFICIAL INTEREST

         As of December 31, 1998 the Company has reserved 621,829 Common Shares
for future issuance under the 1993 Stock Option Plan, 119,596 Common Shares for
future issuance under the 1995 Restricted Stock Incentive Plan, 65,409 Common
Shares for future issuance under the 1995 Director Stock Plan, 441,534 Common
Shares for issuance upon the conversion of the Debentures and 1,000,000 Common
Shares for future issuance under the dividend reinvestment and stock purchase
plan.

         CLASS B COMMON SHARES OF BENEFICIAL INTEREST

         On September 22, 1995, the Company completed a $50 million private
equity placement of non-voting preferred shares of beneficial interest. In May,
1996, the preferred shares of beneficial interest automatically converted, on a
share for share basis, to non-voting Class B Common Shares, upon shareholder
approval of an amendment to the Company's charter permitting non-voting Class B
Common Shares at the Company's annual meeting. The distribution on the
non-voting shares is equal to the distribution paid on the voting shares of the
Company plus an additional $.0468 per share. In October, 1998, 874,639
non-voting Class B Shares converted to voting shares. In May, 1999, a portion of
the remaining non-voting Class B shares will be converted to voting common
shares on a share for share basis up to 4.9 percent of the Company's then
outstanding voting shares with all shares to fully convert within ten years. As
the shares convert to voting common, the distribution paid shall be the same as
all other voting common shares.

         PREFERRED SHARES OF BENEFICIAL INTEREST

         On November 10, 1997, the Company issued 3 million shares of 8.48%
Series A Cumulative Redeemable Preferred Shares of Beneficial Interest
("Preferred Shares") at a purchase price of $25 per share. Dividends on the
Preferred Shares are cumulative from the date of issuance and payable quarterly
commencing on January 30, 1998. The payment of dividends and amounts upon
liquidation will rank senior to the Common Shares and Class B Common Shares,
which are the only other shares of the Company currently outstanding. The
Preferred Shares are not redeemable prior to October 30, 2002. On or after
October 30, 2002 the Preferred Shares will be redeemable for cash at the option
of the Company, in whole or part, at the redemption price of $25 per share, plus
dividends accrued and unpaid to the redemption date. The Preferred Shares are
not convertible into or exchangeable for any other property or securities of the
Company.

         RESTRICTED STOCK INCENTIVE PLAN

         Under the terms of the 1995 Restricted Stock Incentive Plan, adopted in
1995, the Company initially reserved 150,000 common shares for future grants. In
1997 and 1996 certain key employees were granted 12,444 and 8,290 restricted
shares, respectively. Shares were awarded in the name of each of the
participants, who have all the rights of other common shareholders, subject to
certain restrictions and forfeiture provisions. Restrictions on the shares
expire no more than eight years after the date of award, or earlier if certain
performance targets are met.

         Unearned compensation is recorded at the date of awards based on the
market value of shares. Unearned compensation, which is shown as a separate
component of shareholders' equity, is being amortized to expense


                                      F-18

<PAGE>

over the eight year vesting period. The amount amortized to expense during 1998,
1997 and 1996 was $201, $214, and $118, respectively.

         DIRECTOR STOCK PLAN

         The 1995 Director Stock Plan is for an aggregate of 75,000 common
shares and provides that each independent director, upon election or re-election
to the Board, may elect to receive 50% of his annual retainer fee in Common
Shares at the market price on such date. In 1998, 1997, and 1996, 2,304, 1,921,
and 2,516 Common Shares were issued under this plan, respectively. In connection
with the issuance of such shares, $80, $57 and $57 was charged to expense in
1998, 1997 and 1996, respectively.

         SHAREHOLDER RIGHTS PLAN

         In July, 1998, the Board of Trustees approved a shareholder protection
plan (the "plan"), declaring a dividend of one right for each share of the
Company's common shares outstanding on or after August 11, 1998. Exercisable 10
days after any person or group acquires 15 percent or more or commences a tender
offer for 15 percent or more of the Company's common shares, each right entitles
the holder to purchase from the Company one one-thousandth of a Junior Preferred
Share of Beneficial Interest, Series A (a "Rights Preferred Share"), at a price
of $120, subject to adjustment. The Rights Preferred Shares (1) are
non-redeemable, (2) are entitled to a minimum preferential quarterly dividend
payment equal to the greater of $25 per share or 1,000 times the Company's
common share dividend, (3) have a minimum liquidation preference equal to the
greater of $100 per share or 1,000 times the liquidation payment made per common
share and (4) are entitled to vote with the common shares with each Rights
Preferred Share having 1,000 votes. 50,000 of the Company's authorized preferred
shares have been designated for the plan.

         The plan was not adopted in response to any takeover attempt but was
intended to provide the Board with sufficient time to consider any and all
alternatives under such circumstances. Its provisions are designed to protect
the Company's shareholders in the event of an unsolicited attempt to acquire the
Company at a value that is not in the best interest of the Company's
shareholders.

11.      STOCK OPTION PLAN

         The Company has adopted the 1993 Stock Option Plan (the "Plan") and in
May, 1996, increased the maximum number of shares from 750,000 to 1,500,000
common shares of beneficial interest which may be granted for qualified and
non-qualified options. In May, 1998, the Plan was amended to increase the
maximum number of shares to 10% of the total number of common shares outstanding
as of May 1, 1998 (2,003,915). The May, 1998, Plan amendment also provides that
the maximum number of options granted under the plan be the total of 10% of the
number of common shares outstanding on the last day of the preceding calendar
year, commencing January 1, 1999, minus the number of options previously granted
under the Plan before the end of the preceding calendar year plus the number of
options which have expired. The Company adopted the Plan to provide additional
incentives to attract and retain directors, officers and key employees. The Plan
was amended in 1995 to provide that each independent director receive an option
for 3,000 common shares of beneficial interest at fair market value at the time
of being elected or re-elected to the Board. Options are to be granted by the
Compensation Committee of the Board of Directors. The term of the option shall
be fixed by the Compensation Committee, but no option shall be exercisable more
than 10 years after the date of grant.


                                      F-19

<PAGE>

         The options granted are at fair market value on the date of grant, are
for 10-year terms and become exercisable in 20% annual increments after one year
from date of grant. Option activity for the three years ended December 31, 1998
is as follows:

<TABLE>
<CAPTION>
                                                         1998                  1997                 1996
                                                         ----                  ----                 ----
                                                           WEIGHTED               WEIGHTED              WEIGHTED
                                                            AVERAGE                AVERAGE               AVERAGE
                                                           EXERCISE               EXERCISE              EXERCISE
                                                    SHARES   PRICE        SHARES    PRICE      SHARES     PRICE
                                                    --------------        ---------------      ----------------
<S>                                              <C>        <C>         <C>       <C>         <C>       <C>
Outstanding at beginning of year                   740,669  $22.92       683,480  $19.20      606,839   $18.59
   Granted                                         588,179   33.97       241,769   31.38      104,428    22.50
   Exercised                                       (25,500)  18.86      (149,715)  19.19      (27,787)   18.28
   Expired                                         (69,190)  32.00       (34,865)  24.73            -
                                                ----------               -------              -------
Outstanding at end of year                       1,234,158  $27.76       740,669  $22.92      683,480   $19.20
                                                ==========               =======              =======

Exercisable at end of year                         441,126               327,137              282,784

Available for future grant at year end             569,155               584,229              791,133

Weighted average per share fair value of
   options granted during the year                           $4.92                 $3.65                 $2.43
</TABLE>


         The fair value of each option grant was estimated on the date of grant
using the Black-Scholes option-pricing model with the following assumptions:

<TABLE>
<CAPTION>
                                             1998             1997              1996
                                             ----             ----              ----
<S>                                       <C>              <C>               <C>
         Risk free interest rate             5.7%             6.4%              6.1%
         Dividend yield                      5.1%             6.5%              6.5%
         Expected lives                   6 years          6 years           6 years
         Expected volatility                18.6%            17.5%             17.4%
</TABLE>

         The following table summarizes information about stock options at
December 31, 1998:

<TABLE>
<CAPTION>
                                  OPTIONS OUTSTANDING                                 OPTIONS EXERCISABLE
          ---------------------------------------------------------------          -------------------------
                                                 WEIGHTED
                                                  AVERAGE        WEIGHTED                           WEIGHTED
                                  NUMBER         REMAINING        AVERAGE            NUMBER          AVERAGE
             RANGE OF           OUTSTANDING     CONTRACTUAL      EXERCISE          EXERCISABLE      EXERCISE
          EXERCISE PRICE        AT 12/31/98         LIFE            PRICE          AT 12/31/98       PRICE
          --------------        -----------     -----------      --------          -----------       -----
<S>       <C>                     <C>           <C>               <C>                 <C>           <C>

           $18.25-$22.50          487,711       5.83 years        $19.19              406,539        $18.79
          $31.50-$34.375          746,447       9.77 years        $33.36               34,587        $31.34
</TABLE>

         The Company has applied Accounting Principles Board Opinion No. 25 and
related interpretations in accounting for its Plan, accordingly, no compensation
costs have been recognized. Had compensation costs for the Company's Plan been
determined based on the fair value at the grant date for options granted in
1998, 1997 and 1996 in accordance with the method required by Statement of
Financial Accounting Standards No. 123, the Company's net income and net income
per share would have been reduced to the pro forma amounts as follows:


                                      F-20

<PAGE>

<TABLE>
<CAPTION>
                                                                        YEAR ENDED DECEMBER 31,
                                                                 (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                                                 -------------------------------------
                                                             1998                1997            1996
                                                             ----                ----            ----
<S>                                                         <C>                <C>            <C>
Net income available to common shareholders
    As reported                                             $25,888            $26,359        $13,994
    Pro forma                                               $25,406            $26,221        $13,901

Per share net income available to common shareholders
    As reported
       Basic                                                   1.30               1.41           1.01
       Diluted                                                 1.29               1.39           0.99

    Pro forma
       Basic                                                   1.28               1.41           1.00
       Diluted                                                 1.26               1.38           0.98
</TABLE>


12.      FUTURE RENTAL REVENUES

         Under existing noncancelable operating lease agreements as of December
31, 1998, tenants of the warehouse/industrial properties are committed to pay in
aggregate the following minimum rentals:

<TABLE>
<S>                                                         <C>
         1998............................................   $ 66,720
         1999............................................     55,643
         2000............................................     48,391
         2001............................................     42,775
         2002............................................     35,161
         Thereafter......................................     88,175
                                                            --------
                 Total...................................   $336,865
                                                            ========
</TABLE>

         At December 31, 1998 and 1997, 621 and 630, respectively, of the total
682 apartments available for rental at the Lakeshore Dunes property were leased.
Lease terms are generally for one year.

13.      SUPPLEMENTAL INFORMATION TO STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                  YEAR ENDED DECEMBER 31,
                                                                                  -----------------------
                                                                           1998             1997           1996
                                                                           ----             ----           ----
<S>                                                                      <C>              <C>            <C>
         Supplemental disclosure of cash flow information:
                  Interest paid, net of interest capitalized             $12,122          $11,820        $10,603
                  Interest capitalized                                     2,214              893            142
                  Dividends declared, not paid                             1,060              901
                  Assignment of note receivable to affiliate                                4,650
                  Repayment of advance from affiliate
                       with real estate at book value                                      24,993
</TABLE>


                                      F-21

<PAGE>

         In  conjunction with the property acquisitions, the Company assumed the
             following assets and liabilities:

<TABLE>
<S>                                                                      <C>             <C>            <C>
                  Purchase of real estate                                $92,510         $125,352       $103,532
                  Liabilities, net of other assets                        (2,224)          (3,262)        (4,956)
                  Mortgage notes payable                                 (20,586)                        (13,308)
                                                                         -------         --------       --------
                  Acquisition of real estate                             $69,700         $122,090        $85,268
                                                                         =======         ========       ========
</TABLE>

         In  conjunction with the property dispositions, the Company disposed of
             the following assets and liabilities:

<TABLE>
<S>                                                                     <C>              <C>            <C>
                  Sale of real estate                                   $(34,513)        $(12,877)      $(22,481)
                  Liabilities, net of other assets                           565             (633)         1,421
                  Mortgage notes payable                                                                   2,069
                                                                        ---------        ---------    ----------
                  Disposition of real estate                            $(33,948)        $(13,510)      $(18,991)
                                                                        =========        =========    ==========
</TABLE>

         Conversion of convertible subordinated debentures payable:

<TABLE>
<S>                                                                       <C>              <C>            <C>
                  Convertible subordinated dentures converted             $3,682           $2,640         $8,864
                  Common shares issued at $18.25 per share;
                      201,748, 144,640 and 485,680                         3,682            2,639          8,863
                                                                      ----------        ---------     ----------
                  Cash disbursed for fractional shares                    $    -           $    1         $    1
                                                                      ==========        =========     ==========
</TABLE>


14.      COMMITMENTS AND CONTINGENCIES

         In the normal course of business, from time to time, the Company is
involved in legal actions relating to the ownership and operations of its
properties. In management's opinion, the liabilities, if any, that may
ultimately result from such legal actions are not expected to have a materially
adverse effect on the consolidated financial position, results of operations, or
liquidity of the Company.

         The Company has entered into several contracts for the acquisition of
properties. Each acquisition is subject to satisfactory completion of due
diligence and, in the case of developments, completion and occupancy of the
project.

         At December 31, 1998, six of the properties owned are subject to
purchase options held by certain tenants. The purchase options are exercisable
at various intervals through 2006 for amounts that are greater than the net book
value of the assets. The tenant for a property at 655 Wheat Lane, Wood Dale,
Illinois exercised its option and purchase the building in May, 1997.


                                      F-22

<PAGE>



         15. QUARTERLY FINANCIAL HIGHLIGHTS (UNAUDITED)

The following table reflects the results of operations for the Company during
the four quarters of 1998 and 1997. Certain quarterly information has been
revised (dollars in thousands, except unit and per share data):

<TABLE>
<CAPTION>
                                                             QUARTER ENDED
                                        -------------------------------------------------------   YEAR ENDED
                                        MARCH 31,   JUNE 30,    SEPTEMBER 30,    DECEMBER 31,    DECEMBER 31,
                                          1998        1998           1998            1998            1998
                                          ----        ----           ----            ----            ----

<S>                                        <C>         <C>              <C>             <C>            <C>
Total revenues                             $26,786     $26,581          $27,104         $26,755        $107,226
Net income available to common
     shareholders                            7,981       6,088            6,518           5,301          25,888
Net income available to common
     shareholders per share:
          Basic                               0.42        0.30             0.32            0.26            1.30
          Diluted                             0.41        0.30             0.32            0.26            1.29
EBITDA (earnings before interest,           17,681      16,359           17,668          17,434          69,142
     taxes, amortization and
     depreciation)
Per share distributions                      0.438       0.438            0.438           0.438            1.75
</TABLE>

<TABLE>
<CAPTION>
                                                             QUARTER ENDED
                                        -------------------------------------------------------      YEAR ENDED
                                          MARCH 31,   JUNE 30,     SEPTEMBER 30,    DECEMBER 31,    DECEMBER 31,
                                             1997        1997           1997            1997             1997
                                             ----        ----           ----            ----             ----
<S>                                       <C>         <C>          <C>              <C>             <C>

Total revenues                             $19,789     $19,911          $21,251         $24,637         $85,588
Net income available to common
     shareholders                            5,731       6,924            6,434           7,270          26,359
Net income available to common
     shareholders per share:
          Basic                               0.33        0.36             0.34            0.38            1.41
          Diluted                             0.33        0.36             0.33            0.37            1.39
EBITDA (earnings before interest,           11,759      12,752           13,493          15,405          53,409
     taxes, amortization and
     depreciation)
Per share distributions                       0.42        0.42             0.42            0.42            1.68
</TABLE>


                                      F-23

<PAGE>

                        REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Shareholders
CenterPoint Properties Trust

         Our report on the consolidated financial statements of CenterPoint
Properties Trust and Subsidiaries is included as page F-2 of this Form 10-K/A.
In connection with our audits of such financial statements, we have also audited
the related financial statement schedules listed in the Index to Consolidated
Financial Statements on page F-1 of this Form 10-K/A.

         In our opinion, these revised financial statement schedules referred to
above, when considered in relation to the basic financial statements taken as a
whole, present fairly, in all material respects, the information required to be
included therein.

                                                      PRICEWATERHOUSECOOPERS LLP

Chicago, Illinois
November 15, 1999


                                      F-24

<PAGE>

                          CENTERPOINT PROPERTIES TRUST
                        VALUATION AND QUALIFYING ACCOUNTS
                                   SCHEDULE II
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                          BEGINNING    CHARGE TO COST                                      ENDING
                                           BALANCE      AND EXPENSES      RECOVERIES     DEDUCTIONS(a)     BALANCE
                                           -------      ------------      ----------     -------------     -------
<S>                                         <C>           <C>                 <C>            <C>           <C>

DESCRIPTION
-----------
For year ended December 31, 1998:
  Allowance for doubtful accounts           $272          $550                $ -            ($247)        $575
                                            ====          ====               ====            =====         ====

For year ended December 31, 1997:
  Allowance for doubtful accounts           $748          $279                $ -            ($755)        $272
                                            ====          ====               ====            =====         ====

For year ended December 31, 1996:
  Allowance for doubtful accounts           $500          $462                $ -            ($214)        $748
                                            ====          ====               ====            =====         ====
</TABLE>




---------------------------
NOTE: (a) Deductions represent write-off of accounts receivable against the
allowance for doubtful accounts.


                                      F-25

<PAGE>

<TABLE>
<CAPTION>

              CENTERPOINT PROPERTIES CORPORATION AND SUBSIDIARIES                                                    SCHEDULE III
                   REAL ESTATE AND ACCUMULATED DEPRECIATION
                            AS OF DECEMBER 31, 1998




                                                     INITIAL COSTS                                 COSTS CAPITALIZED
                                             ---------------------------------                 SUBSEQUENT TO ACQUISITION
                                                                 BUILDINGS AND        -------------------------------------------
                              ENCUMBRANCES                       IMPROVEMENTS                        BUILDINGS AND      CARRYING
DESCRIPTION                       (e)          LAND                   (a)                LAND         IMPROVEMENTS      COSTS (b)
-----------------------       ------------   --------            -------------        ----------     -------------      ---------
<S>                           <C>            <C>                 <C>                  <C>            <C>                <C>
WAREHOUSE/INDUSTRIAL
  PROPERTIES:

425 W. 151st Street
  East Chicago, IN                              $ 252               $ 1,805             $ 34               $ 4,523      $ 1,155
201 Mississippi Street
  Gary, IN                    $50,000(h)          807                 9,948              275                18,042
1201 Lunt Avenue
  Elk Grove Village, IL              (h)           57                   146                                      4
620 Butterfield Road
  Mundelein, IL                30,000(g)          335                 1,974               61                     6
1319 Marquette Drive
  Romeoville, IL                     (h)          948                 2,530                                     98
900 E. 103rd Street
  Chicago, IL                                   2,226                10,693                                  4,497
1520 Pratt Avenue
  Elk Grove Village, IL              (h)          498                 1,558                                      6
1850 Greenleaf
  Elk Grove Village, IL                           509                 1,386                                    349
2743 Armstrong Court
  Des Plaines, IL                               1,320                 2,679                1                   280
5990 Touhy Avenue
  Niles, IL                                     2,047                 8,509                                  1,238
950 Tower Road
  Mundelein, IL                      (h)          171                   778                                    142
2339 Ernie Krueger Court
  Waukegan, IL                       (g)          158                 1,819                                     10
4501 W. Augusta Blvd.
  Chicago, IL                                     175                 4,988                                    859
1400 Busse Road
  Elk Grove Village, IL                           439                 5,719                                    287
1250 Carolina Drive
  West Chicago, IL                   (g)          583                 3,836                                    260
5619 W. 115th Street
  Alsip, IL                          (h)        2,267                12,169                                  1,640
825 Tollgate Road
  Elgin, IL                          (g)          712                 3,584                                    113
720 Frontenac
  Naperville, IL                     (g)        1,014                 4,055               22                   121
820 Frontenac
  Naperville, IL                     (g)          906                 3,626                                    111
1120 Frontenac
  Naperville, IL                     (g)          791                 3,164               23                   720
1510 Frontenac
  Naperville, IL                     (g)          621                 2,485               16                    83
1020 Frontenac
  Naperville, IL                     (g)          591                 2,363               11                   225
1560 Frontenac
  Naperville, IL                     (g)          508                 2,034               11                    72
1500 Shore Road
  Naperville, IL                     (g)          260                 1,042                7                    58
800 Enterprise
  Naperville, IL                     (g)          212                   849                6                    40
1651 Frontenac
  Naperville, IL                     (g)          185                   742                5                    61
1150 Shore Road
  Naperville, IL                     (g)          184                   736                5                   121

<CAPTION>
                                                                                                                       LIFE UPON
                                                                                                                         WHICH
                             GROSS AMOUNTS AT WHICH                                                                  DEPRECIATION
                           CARRIED AT CLOSE OF PERIOD                                                                 IN LATEST
                           --------------------------                                                                   INCOME
                                          BUILDINGS AND                     ACCUMULATED        DATE OF        DATE   STATEMENT IS
DESCRIPTION                 LAND          IMPROVEMENTS     TOTAL (c) (d)   DEPRECIATION      CONSTRUCTION   ACQUIRED   COMPUTED
-----------------------   ---------       ------------     -------------   ------------      ------------  -------- ----------
<S>                       <C>             <C>              <C>             <C>              <C>             <C>      <C>
WAREHOUSE/INDUSTRIAL
  PROPERTIES:

425 W. 151st Street
  East Chicago, IN          $ 286              $ 7,483         $ 7,769         $ (2,864)    1913/1988-1990     1987      (f)
201 Mississippi Street
  Gary, IN                  1,082               27,990          29,072           (9,432)    1946/1985-1988     1985      (f)
1201 Lunt Avenue
  Elk Grove Village, IL        57                  150             207              (24)       1971            1993      (f)
620 Butterfield Road
  Mundelein, IL               396                1,980           2,376             (317)       1990            1993      (f)
1319 Marquette Drive
  Romeoville, IL              948                2,628           3,576             (408)     1990-1991         1993      (f)
900 E. 103rd Street
  Chicago, IL               2,226               15,190          17,416           (2,197)       1910            1993      (f)
1520 Pratt Avenue
  Elk Grove Village, IL       498                1,564           2,062             (250)       1968            1993      (f)
1850 Greenleaf
  Elk Grove Village, IL       509                1,735           2,244             (225)       1965            1993      (f)
2743 Armstrong Court
  Des Plaines, IL           1,321                2,959           4,280             (449)     1989-1990         1993      (f)
5990 Touhy Avenue
  Niles, IL                 2,047                9,747          11,794           (1,462)       1957            1993      (f)
950 Tower Road
  Mundelein, IL               171                  920           1,091             (139)       1979            1993      (f)
2339 Ernie Krueger Court
  Waukegan, IL                158                1,829           1,987             (292)       1990            1993      (f)
4501 W. Augusta Blvd.
  Chicago, IL                 175                5,847           6,022             (878)     1942-1943         1993      (f)
1400 Busse Road
  Elk Grove Village, IL       439                6,006           6,445           (1,029)       1987            1993      (f)
1250 Carolina Drive
  West Chicago, IL            583                4,096           4,679             (637)     1989-1990         1993      (f)
5619 W. 115th Street
  Alsip, IL                 2,267               13,809          16,076           (2,154)       1974            1993      (f)
825 Tollgate Road
  Elgin, IL                   712                3,697           4,409             (579)     1989-1991         1993      (f)
720 Frontenac
  Naperville, IL            1,036                4,176           5,212             (663)       1991            1993      (f)
820 Frontenac
  Naperville, IL              906                3,737           4,643             (584)       1988            1993      (f)
1120 Frontenac
  Naperville, IL              814                3,884           4,698             (592)       1980            1993      (f)
1510 Frontenac
  Naperville, IL              637                2,568           3,205             (406)       1986            1993      (f)
1020 Frontenac
  Naperville, IL              602                2,588           3,190             (398)       1980            1993      (f)
1560 Frontenac
  Naperville, IL              519                2,106           2,625             (335)       1987            1993      (f)
1500 Shore Road
  Naperville, IL              267                1,100           1,367             (172)       1985            1993      (f)
800 Enterprise
  Naperville, IL              218                  889           1,107             (139)       1985            1993      (f)
1651 Frontenac
  Naperville, IL              190                  803             993             (122)       1978            1993      (f)
1150 Shore Road
  Naperville, IL              189                  857           1,046             (122)       1985            1993      (f)
</TABLE>


                                     F-26
<PAGE>

<TABLE>
<CAPTION>

                                                     INITIAL COSTS                                 COSTS CAPITALIZED
                                             ---------------------------------                 SUBSEQUENT TO ACQUISITION
                                                                 BUILDINGS AND        -------------------------------------------
                              ENCUMBRANCES                       IMPROVEMENTS                        BUILDINGS AND      CARRYING
DESCRIPTION                       (e)          LAND                   (a)                LAND         IMPROVEMENTS      COSTS (b)
-----------------------       ------------   --------            -------------        ----------     -------------      ---------
<S>                           <C>            <C>                 <C>                  <C>            <C>                <C>

2764 Golfview
  Naperville, IL                      (g)          125                   498                4                    33
920 Frontenac
  Naperville, IL                      (g)          717                 2,367                                    486
1300 Northpoint Road
  Waukegan IL                         (h)          592                 2,366                                     17
1 Wildlife Way
  Long Grove, IL                                   530                 2,122                                    129
900 W. University Drive
  Arlington Heights, IL               (h)          817                 3,268               17                    95
7001 Adams Street
  Willowbrook, IL                     (h)          297                 1,326                                      4
745 Birginal Drive
  Bensenville, IL                                  601                 2,406                                    498
21399 Torrence Avenue
  Sauk Village , IL                              1,550                 6,199              566                   707
2600 N. Elmhurst Road
  Elk Grove Village, IL.              (g)          842                 3,366                8                    46
8901 W. 102nd Street
  Pleasant Prarie, WI                 (h)          900                 3,608                                     47
8200 100th Street
  Pleasant Prarie, WI                 (h)        1,220                 4,890                                     42
1700 Hawthorne
  West Chicago, IL                               2,522                10,089                1                    25
245 Beinoris Drive
  Wood Dale, IL                       (h)          168                   570                                      5
825-845 Hawthorne
  West Chicago, IL                    (g)          721                 2,884               23                   503
1700 Butterfield Road
  Mundelein, IL                       (h)          343                 1,371               (1)                  143
1810-1820 Industrial Drive
  Libertyville, IL                    (h)          407                 1,629               (5)                  173
1733 Downs Drive
  West Chicago                        (h)          488                 1,953                1                    45
1645 Downs Drive
  West Chicago                        (h)          508                 2,033                                    571
10601 Seymour Avenue
  Franklin Park, IL                              2,020                 8,081              184                10,716
11701 South Central
  Alsip, IL                                      1,241                 4,964               22                 1,242
11601 South Central
  Alsip, IL                                      1,071                 4,285               51                   376
850 Arthur Avenue
  Elk Grove Village, IL              575           270                 1,081                1                   283
1827 North Bendix Drive
  South Bend, IN                      (h)        1,010                 4,040               24                   109
4400 S. Kolmar
  Chicago, IL                         (h)          603                 2,412                9                    70
6600 River Road
  Hodgkins, IL                                   2,640                10,562               47                   350
7501 N. 81st Street
  Milwaukee, WI                                  1,018                 4,073               19                    83
1100 Chase Avenue
  Elk Grove Village, IL                            248                   993                6                   239
2553 N. Edgington
  Franklin Park, IL                              1,870                 7,481               67                 1,278

<CAPTION>

                                                                                                                      LIFE UPON
                                                                                                                        WHICH
                             GROSS AMOUNTS AT WHICH                                                                  DEPRECIATION
                           CARRIED AT CLOSE OF PERIOD                                                                 IN LATEST
                           ----------------------------                                                                 INCOME
                                          BUILDINGS AND                     ACCUMULATED        DATE OF        DATE    STATEMENT IS
DESCRIPTION                 LAND          IMPROVEMENTS     TOTAL (c) (d)   DEPRECIATION      CONSTRUCTION   ACQUIRED   COMPUTED
-----------------------   ---------       -------------    -------------   ------------      ------------   --------  ----------
<S>                       <C>             <C>              <C>             <C>               <C>             <C>      <C>
2764 Golfview                    129                  531           660             (83)       1985          1993           (f)
  Naperville, IL
920 Frontenac                    717                2,853         3,570            (413)       1987          1993           (f)
  Naperville, IL
1300 Northpoint Road             592                2,383         2,975            (350)       1994          1994           (f)
  Waukegan IL
1 Wildlife Way                   530                2,251         2,781            (329)       1994          1994           (f)
  Long Grove, IL
900 W. University Drive          834                3,363         4,197            (479)       1974          1994           (f)
  Arlington Heights, IL
7001 Adams Street                297                1,330         1,627            (188)       1994          1994           (f)
  Willowbrook, IL
745 Birginal Drive               601                2,904         3,505            (359)       1974          1994           (f)
  Bensenville, IL
21399 Torrence Avenue          2,116                6,906         9,022            (957)       1987          1994           (f)
  Sauk Village , IL
2600 N. Elmhurst Road            850                3,412         4,262            (409)       1995          1995           (f)
  Elk Grove Village, IL.
8901 W. 102nd Street             900                3,655         4,555            (485)       1990          1994           (f)
  Pleasant Prarie, WI
8200 100th Street              1,220                4,932         6,152            (657)       1990          1994           (f)
  Pleasant Prarie, WI
1700 Hawthorne                 2,523               10,114        12,637          (1,312)     1959/1969       1994           (f)
  West Chicago, IL
245 Beinoris Drive               168                  575           743             (91)       1988          1984           (f)
  Wood Dale, IL
825-845 Hawthorne                744                3,387         4,131            (367)       1974          1995           (f)
  West Chicago, IL
1700 Butterfield Road            342                1,514         1,856            (169)       1976          1995           (f)
  Mundelein, IL
1810-1820 Industrial Drive       402                1,802         2,204            (188)       1977          1995           (f)
  Libertyville, IL
1733 Downs Drive                 489                1,998         2,487            (221)       1976          1995           (f)
  West Chicago
1645 Downs Drive                 508                2,604         3,112            (280)       1976          1995           (f)
  West Chicago
10601 Seymour Avenue           2,204               18,797        21,001            (999)     1963/1965       1995           (f)
  Franklin Park, IL
11701 South Central            1,263                6,206         7,469            (555)       1972          1995           (f)
  Alsip, IL
11601 South Central            1,122                4,661         5,783            (469)       1971          1995           (f)
  Alsip, IL
850 Arthur Avenue                271                1,364         1,635            (132)     1972/1973       1995           (f)
  Elk Grove Village, IL
1827 North Bendix Drive        1,034                4,149         5,183            (411)     1964/1990       1995           (f)
  South Bend, IN
4400 S. Kolmar                   612                2,482         3,094            (245)       1964          1995           (f)
  Chicago, IL
6600 River Road                2,687               10,912        13,599            (933)      Unknown        1996           (f)
  Hodgkins, IL
7501 N. 81st Street            1,037                4,156         5,193            (345)       1987          1996           (f)
  Milwaukee, WI
1100 Chase Avenue                254                1,232         1,486            (104)       1969          1996           (f)
  Elk Grove Village, IL
2553 N. Edgington              1,937                8,759        10,696            (649)     1967/1989       1996           (f)
  Franklin Park, IL
</TABLE>

                                     F-27
<PAGE>

<TABLE>
<CAPTION>



                                                     INITIAL COSTS                                 COSTS CAPITALIZED
                                             ---------------------------------                 SUBSEQUENT TO ACQUISITION
                                                                 BUILDINGS AND        -------------------------------------------
                              ENCUMBRANCES                       IMPROVEMENTS                        BUILDINGS AND      CARRYING
DESCRIPTION                       (e)          LAND                   (a)                LAND         IMPROVEMENTS      COSTS (b)
-----------------------       ------------   --------            -------------        ----------     -------------      ---------
<S>                           <C>            <C>                 <C>                  <C>            <C>                <C>
875 Fargo Avenue
  Elk Grove Village, IL                            572                 2,284               14                   882
1800 Bruning Drive
  Itasca, IL                                     1,999                 7,995               26                   108
1501 Pratt
  Elk Grove Village, IL                          1,047                 4,189               67                   501
400 N. Wolf Road
  Northlake, IL                                  4,504                18,017             (418)                7,478
10740 W. Grand Avenue
  Franklin Park, IL                                383                 1,532                8                   173
16400 W. 103rd Street
  Lemont, IL                                       446                 1,748               21                   236
425 S. 37th Avenue
  St. Charles, IL                                  644                 2,575                7                   236
1500 W. Dundee Road
  Arlington Heights, IL                          4,995                10,006           (1,073)                5,649
Lot 51-Naperville Business
  Center Naperville, IL                            220                                    (11)                    1
3145 Central Avenue
  Waukeegan, IL                                  1,270                 5,080               20                 1,620
2003-2207 South 114th Street
  West Allis, WI                                   942                 3,770                6                    77
2501-2701 Busse Road
  Elk Grove Village, IL             (h)          1,875                 7,556               12                   578       107
6464 West 51st Street
  Forest View, IL                                  934                 3,734                3                   156
6500 West 51st Street
  Forest View, IL                                  805                 3,221                3                    29
7447 South Central Avenue
  Bedford Park, IL                                 437                 1,748                7                    36
7525 S. Sayre Avenue
  Bedford Park, IL                                 587                 2,345                4                    29
2901 Centre Circle
  Downers Grove, IL                                207                   828                4                   557
1 Allsteel Drive
  Aurora, IL                                     2,458                 9,832               28                 7,929
2525 Busse Highway
  Elk Grove Village, IL                          5,400                12,601             (729)                2,558
106th and Buffalo Avenue
  Chicago, IL                                      248                   992                9                   558
7400 South Narragansett
  Bedford Park,IL                                  743                 2,972                9                   179
2701 S. Busse Road
  Elk Grove Village, IL             (h)          1,875                 5,667                4                 1,288       255
East Avenue and 55th Street
  McCook, IL                                     1,190                 4,761               47                   430
6757 S. Sayre
  Bedford Park, IL                               1,236                 4,945                7                    28
1951 Landmeir Road
  Elk Grove Village, IL                            280                 1,120               11                    48
1355 Enterprise Drive
  Romeoville, IL                                   580                 2,320                8                   111
110-190 Old Higgins Road
  Des Plaines, IL                                1,862                 7,447               12                   327
1475 S. 101st Street
  West Allis, WI                                   331                 1,323                1                    40
1333 Grandview Drive
  Yorkville, WI                                  1,516                 6,062                5                    21

<CAPTION>


                                                                                                                        LIFE UPON
                                                                                                                          WHICH
                             GROSS AMOUNTS AT WHICH                                                                   DEPRECIATION
                           CARRIED AT CLOSE OF PERIOD                                                                  IN LATEST
                           --------------------------                                                                    INCOME
                                          BUILDINGS AND                     ACCUMULATED        DATE OF         DATE   STATEMENT IS
DESCRIPTION                 LAND          IMPROVEMENTS     TOTAL (c) (d)   DEPRECIATION      CONSTRUCTION     ACQUIRED  COMPUTED
-----------------------     ----          ------------     -------------   ------------      ------------     -------- ----------
<S>                         <C>           <C>              <C>             <C>               <C>              <C>      <C>
875 Fargo Avenue              586           3,166            3,752            (220)              1979            1996       (f)
  Elk Grove Village, IL
1800 Bruning Drive          2,025           8,103           10,128            (653)            1975/1978         1996       (f)
  Itasca, IL
1501 Pratt                  1,114           4,690            5,804            (371)              1973            1996       (f)
  Elk Grove Village, IL
400 N. Wolf Road            4,086          25,495           29,581          (1,716)            1956/1965         1996       (f)
  Northlake, IL
10740 W. Grand Avenue         391           1,705            2,096            (126)            1964/1970         1996       (f)
  Franklin Park, IL
16400 W. 103rd Street         467           1,984            2,451            (131)              1983            1996       (f)
  Lemont, IL
425 S. 37th Avenue            651           2,811            3,462            (195)              1976            1996       (f)
  St. Charles, IL
1500 W. Dundee Road         3,922          15,655           19,577            (853)            1969/1971         1996       (f)
  Arlington Heights, IL
Lot 51-Naperville Business    209               1              210               -               1996            1996       (f)
  Center Naperville, IL
3145 Central Avenue         1,290           6,700            7,990            (396)              1960            1997       (f)
  Waukeegan, IL
2003-2207 South 114th         948           3,847            4,795            (212)            1965/1966         1997       (f)
  Street West Allis, WI
2501-2701 Busse Road        1,887           8,241           10,128            (453)              1997            1997       (f)
  Elk Grove Village, IL
6464 West 51st Street         937           3,890            4,827            (205)              1973            1997       (f)
  Forest View, IL
6500 West 51st Street         808           3,250            4,058            (171)              1974            1997       (f)
  Forest View, IL
7447 South Central Avenue     444           1,784            2,228             (94)              1980            1997       (f)
  Bedford Park, IL
7525 S. Sayre Avenue          591           2,374            2,965            (125)              1980            1997       (f)
  Bedford Park, IL
2901 Centre Circle            211           1,385            1,596             (67)              1975            1997       (f)
  Downers Grove, IL
1 Allsteel Drive            2,486          17,761           20,247            (755)            1957-1967         1997       (f)
  Aurora, IL
2525 Busse Highway          4,671          15,159           19,830            (645)              1975            1997       (f)
  Elk Grove Village, IL
106th and Buffalo Avenue      257           1,550            1,807             (89)              1971            1997       (f)
  Chicago, IL
7400 South Narragansett       752           3,151            3,903            (129)              1977            1997       (f)
  Bedford Park,IL
2701 S. Busse Road          1,879           7,210            9,089            (227)              1997            1997       (f)
  Elk Grove Village, IL
East Avenue and 55th Street 1,237           5,191            6,428            (201)              1979            1997       (f)
  McCook, IL
6757 S. Sayre               1,243           4,973            6,216            (197)              1975            1997       (f)
  Bedford Park, IL
1951 Landmeir Road            291           1,168            1,459             (46)              1967            1997       (f)
  Elk Grove Village, IL
1355 Enterprise Drive         588           2,431            3,019             (93)            1980/1986         1997       (f)
  Romeoville, IL
110-190 Old Higgins Road    1,874           7,774            9,648            (243)              1980            1997       (f)
  Des Plaines, IL
1475 S. 101st Street          332           1,363            1,695             (43)            1968/1988         1997       (f)
  West Allis, WI
1333 Grandview Drive        1,521           6,083            7,604            (193)              1994            1997       (f)
  Yorkville, WI
</TABLE>


                                     F-28
<PAGE>

<TABLE>
<CAPTION>



                                                     INITIAL COSTS                                 COSTS CAPITALIZED
                                             ---------------------------------                 SUBSEQUENT TO ACQUISITION
                                                                 BUILDINGS AND        -------------------------------------------
                              ENCUMBRANCES                       IMPROVEMENTS                        BUILDINGS AND      CARRYING
DESCRIPTION                       (e)          LAND                   (a)                LAND         IMPROVEMENTS      COSTS (b)
-----------------------       ------------   --------            -------------        ----------     -------------      ---------
<S>                           <C>            <C>                 <C>                  <C>            <C>                <C>
2301 Route 30
  Plainfield, IL                               1,217                 4,868               69                 1,310
1796 Sherwin Avenue
  Des Plaines, IL                                944                 3,778                8                 1,032
2885 W. Diehl Road
  Naperville, IL                               1,539                 8,630                2                   112
2727 W. Diehl Road
  Naperville, IL                               3,071                14,232                5                   388
O'hare Express Center - A2
  Elk GroveVillage, IL                         1,097                 7,060                                    244           110
O'hare Express Center - B1
  Elk GroveVillage, IL                         1,682                10,500                                    522            96
2021 Lunt Avenue
  Elk Grove, IL                                  464                 1,855                7                   130
2121 Touhy Avenue
  Elk Grove, IL                                  918                 3,672               11                   163
Champion
  North Lake, IL                                 467                 6,124                                                   87
860 West Evergreen
  Chicago, IL                                  1,169                 4,675               10                    59
2001 S. Mt. Prospect Road
  Des Plaines, IL                              1,056                 4,223              (76)                  256
745 Dillon Drive
  Wood Dale, IL                                  705                 2,820              (60)                 (208)
1030 Fabyan Parkway
  Batavia, IL                                  1,323                 5,292             (117)                 (211)
5730 N. Tripp
  Chicago, IL                                    647                 2,990                3                  (176)
4700 Ironwood Drive
  Franklin, WI                                   419                 3,415                7                   151
2601 Bond Street
  University Park, IL                            382                 1,527                6                    21
201 Oakton
  Des Plaines, IL                                838                 3,351                6                 1,109
3601 Runge Avenue
  Franklin Park, IL           8,985(i)           541                 2,180                3                    45
3400 N. Powell
  Franklin Park, IL                (i)           812                 3,277                3                    30
11100 West Addition
  Franklin Park, IL                (i)           250                 1,013                3                    34
11440 West Addition
  Franklin Park, IL                (i)           540                 2,200                3                    45
3434 N. Powell
  Franklin Park, IL                (i)           429                 1,723                3                    26
7633 S. Sayre
  Bedford Park                     (i)           167                   700                3                    25
1999 N. Ruby
  Franklin Park, IL                (i)           402                 1,615                3                    34
11550 W. King Drive
  Franklin Park, IL                (i)           320                 1,303                3                    27
7201 S. Leamington
  Bedford Park, IL                 (i)           340                 1,697               (4)
1575 Executive Drive
  Elgin, IL                        (i)           240                   964                3                    27
7200 S. Mason
  Bedford Park, IL                 (i)         1,037                 4,286                3                    24
6000 W. 73rd
  Bedford Park, IL            4,107(k)           794                 3,190                3                    27

<CAPTION>


                                                                                                                        LIFE UPON
                                                                                                                          WHICH
                              GROSS AMOUNTS AT WHICH                                                                  DEPRECIATION
                            CARRIED AT CLOSE OF PERIOD                                                                 IN LATEST
                           ----------------------------                                                                  INCOME
                                          BUILDINGS AND                     ACCUMULATED        DATE OF         DATE   STATEMENT IS
DESCRIPTION                 LAND          IMPROVEMENTS     TOTAL (c) (d)   DEPRECIATION      CONSTRUCTION     ACQUIRED  COMPUTED
-----------------------   ---------       ------------     -------------   ------------      ------------     -------- ----------
<S>                       <C>             <C>              <C>             <C>               <C>              <C>      <C>
2301 Route 30                  1,286                6,178            7,464          (185)     1972/1984        1997      (f)
  Plainfield, IL
1796 Sherwin Avenue              952                4,810            5,762          (152)       1964           1997      (f)
  Des Plaines, IL
2885 W. Diehl Road             1,541                8,742           10,283          (276)       1997           1997      (f)
  Naperville, IL
2727 W. Diehl Road             3,076               14,620           17,696          (460)       1997           1997      (f)
  Naperville, IL
O'hare Express Center - A2     1,097                7,414            8,511          (376)       1997           1997      (f)
  Elk GroveVillage, IL
O'hare Express Center - B1     1,682               11,118           12,800          (547)       1997           1997      (f)
  Elk GroveVillage, IL
2021 Lunt Avenue                 471                1,985            2,456           (56)       1972           1998      (f)
  Elk Grove, IL
2121 Touhy Avenue                929                3,835            4,764          (109)       1962           1998      (f)
  Elk Grove, IL
Champion                         467                6,211            6,678          (163)       1998           1998      (f)
  North Lake, IL
860 West Evergreen             1,179                4,734            5,913          (113)     1890/1995        1998      (f)
  Chicago, IL
2001 S. Mt. Prospect Road        980                4,479            5,459           (92)       1980           1998      (f)
  Des Plaines, IL
745 Dillon Drive                 645                2,612            3,257           (50)     1985/1986        1998      (f)
  Wood Dale, IL
1030 Fabyan Parkway            1,206                5,081            6,287           (99)       1978           1998      (f)
  Batavia, IL
5730 N. Tripp                    650                2,814            3,464           (77)       1975           1998      (f)
  Chicago, IL
4700 Ironwood Drive              426                3,566            3,992           (70)       1998           1998      (f)
  Franklin, WI
2601 Bond Street                 388                1,548            1,936           (28)       1975           1998      (f)
  University Park, IL
201 Oakton                       844                4,460            5,304           (57)       1984           1998      (f)
  Des Plaines, IL
3601 Runge Avenue                544                2,225            2,769           (35)       1962           1998      (f)
  Franklin Park, IL
3400 N. Powell                   815                3,307            4,122           (52)       1961           1998      (f)
  Franklin Park, IL
11100 West Addition              253                1,047            1,300           (16)       1967           1998      (f)
  Franklin Park, IL
11440 West Addition              543                2,245            2,788           (35)       1961           1998      (f)
  Franklin Park, IL
3434 N. Powell                   432                1,749            2,181           (28)       1960           1998      (f)
  Franklin Park, IL
7633 S. Sayre                    170                  725              895           (11)     1968/1969        1998      (f)
  Bedford Park
1999 N. Ruby                     405                1,649            2,054           (26)       1962           1998      (f)
  Franklin Park, IL
11550 W. King Drive              323                1,330            1,653           (21)       1963           1998      (f)
  Franklin Park, IL
7201 S. Leamington               336                1,697            2,033           (27)       1958           1998      (f)
  Bedford Park, IL
1575 Executive Drive             243                  991            1,234           (16)       1980           1998      (f)
  Elgin, IL
7200 S. Mason                  1,040                4,310            5,350           (68)       1974           1998      (f)
  Bedford Park, IL
6000 W. 73rd                     797                3,217            4,014           (51)       1974           1998      (f)
  Bedford Park, IL
</TABLE>


                                    F-29
<PAGE>

<TABLE>
<CAPTION>



                                                        INITIAL COSTS                              COSTS CAPITALIZED
                                             ------------------------------------              SUBSEQUENT TO ACQUISITION
                                                                    BUILDINGS AND        -------------------------------------------
                              ENCUMBRANCES                          IMPROVEMENTS                        BUILDINGS AND      CARRYING
DESCRIPTION                       (e)            LAND                   (a)                LAND         IMPROVEMENTS      COSTS (b)
-----------------------       ------------   -----------            -------------        ----------     -------------      ---------
<S>                           <C>            <C>                    <C>                  <C>            <C>               <C>

28160 N. Keith
  Lake Forest, IL                      (k)          616                 2,496                 3                    26
28618 N. Ballard
  Lake Forest, IL                 2,260(j)          469                 1,943                 3                    30
28161 N. Keith
  Lake Forest, IL                      (j)          270                 1,092                 3                    24
11400 W. Melrose Street
  Franklin Park, IL                                 168                    43                 3                    11
11801 S. Central
  Alsip, IL                       4,901           1,592                 6,367                 2                   753
1925 Holmes Road
  Elgin, IL                                         772                 3,087                 1                    16
1381 N. Northbrank
  Chicago, IL                                       161                   645                14                    56
5611 W. Mill Road
  Milwaukee, WI                                     231                   925               (23)                  (94)
543 W. Algonquin
  Arlington Heights, IL                             260                 1,041
Dial
  Granite City, IL                                3,891                15,555


CONSTRUCTION IN PROGRESS:

O'hare Express - B2
  Elk Grove Village, IL                           1,618                 6,287                                                 216
O'hare Express - C
  Elk Grove Village, IL                           2,603                 1,890                                                  92
1808 Swift Road
  Oak Brook, IL                                     143                   123               332                 2,497
5480 W. 70th
  Bedford Park, IL                                  475
NIC (South Building)
  Northlake, IL                                       -                 5,026                                                  81
10801 W. Irving Park Rd
  Chicago, IL                                         -                 1,106                                                   6
5700 West Touhy Avenue
  Niles, IL                                      18,005                   139            (9,108)                  911          30

RETAIL PROPERTIES:

84 Old McHenry Road
  Wheeling, IL                                      482                 2,152                                      31
351 N. Rohlwing Road
  Itasca, IL                                         81                   464
4-48 Barrington Road
  Streamwood, IL                                    573                 2,297               (62)                   92

RESIDENTIAL PROPERTIES

440 North Lake Street
  Miller, IN                     22,220             711                 3,086               101                18,470       3,980

OFFICES OF THE MANAGEMENT
COMPANY
CHICAGO, IL                                           -                15,918               826                               513
                          --------------        -------               -------            -------             --------      ------
Totals                    $ 123,050,221         140,632               517,646            (8,362)              112,213       6,728
                          ==============        ========              ========           =======             ========      ======

<CAPTION>


                                                                                                                     LIFE UPON
                                                                                                                       WHICH
                             GROSS AMOUNTS AT WHICH                                                                 DEPRECIATION
                           CARRIED AT CLOSE OF PERIOD                                                                IN LATEST
                           --------------------------                                                                  INCOME
                                          BUILDINGS AND                     ACCUMULATED        DATE OF        DATE  STATEMENT IS
DESCRIPTION                 LAND          IMPROVEMENTS     TOTAL (c) (d)   DEPRECIATION      CONSTRUCTION   ACQUIRED  COMPUTED
-----------------------   ---------       ------------     -------------   ------------      ------------   -------- ----------
<S>                       <C>             <C>              <C>             <C>           <C>                <C>      <C>


28160 N. Keith                   619             2,522          3,141            (40)         1989           1998         (f)
  Lake Forest, IL
28618 N. Ballard                 472             1,973          2,445            (31)         1984           1998         (f)
  Lake Forest, IL
28161 N. Keith                   273             1,116          1,389            (18)         1986           1998         (f)
  Lake Forest, IL
11400 W. Melrose Street          171                54            225             (4)                        1998         (f)
  Franklin Park, IL
11801 S. Central               1,594             7,120          8,714            (70)         1985           1998         (f)
  Alsip, IL
1925 Holmes Road                 773             3,103          3,876            (33)         1989           1998         (f)
  Elgin, IL
1381 N. Northbrank               175               701            876             (6)         1900           1998         (f)
  Chicago, IL
5611 W. Mill Road                208               831          1,039             (4)         1960           1998         (f)
  Milwaukee, WI
543 W. Algonquin                 260             1,041          1,301             (3)         1970           1998         (f)
  Arlington Heights, IL
Dial                           3,891            15,555         19,446                         1998           1998         (f)
  Granite City, IL


CONSTRUCTION IN PROGRESS:

O'hare Express - B2            1,618             6,503          8,121            (66)
  Elk Grove Village, IL
O'hare Express - C             2,603             1,982          4,585           (107)
  Elk Grove Village, IL
1808 Swift Road                  475             2,620          3,095                                        Var.         (f)
  Oak Brook, IL
5480 W. 70th                     475                 -            475
  Bedford Park, IL
NIC (South Building)               -             5,107          5,107
  Northlake, IL
10801 W. Irving Park Rd            -             1,112          1,112
  Chicago, IL
5700 West Touhy Avenue         8,897             1,080          9,977             (8)         1948           1997         (f)
  Niles, IL

RETAIL PROPERTIES:

84 Old McHenry Road              482             2,183          2,665           (376)      1989-1990         1993         (f)
  Wheeling, IL
351 N. Rohlwing Road              81               464            545            (75)         1989           1993         (f)
  Itasca, IL
4-48 Barrington Road             511             2,389          2,900           (334)         1989           1994         (f)
  Streamwood, IL

RESIDENTIAL PROPERTIES

440 North Lake Street            812            25,536         26,348         (6,791)    1971/1990-1993      1990         (f)
  Miller, IN

OFFICES OF THE MANAGEMENT
COMPANY
CHICAGO, IL                      826            16,431         17,257         (3,098)
                            --------          --------        -------        --------
 Totals                      132,270           636,587        768,857        (62,257)
                            ========          ========        =======        ========
</TABLE>


                                      F-30
<PAGE>


                  CENTERPOINT PROPERTIES TRUST AND SUBSIDIARIES
                            SCHEDULE III (CONTINUED)
                             (DOLLARS IN THOUSANDS)

Notes to Schedule III:

(a)  Initial cost for each respective property is the total acquisition costs
     associated with its purchase.
(b)  Carrying costs consist of capitalized construction period interest, taxes
     and insurance.
(c)  At December 31, 1998, the aggregate cost of land and buildings and
     equipment for Federal income tax purposes was approximately $772 million.
(d)  Reconciliation of real estate and accumulated depreciation:

                          RECONCILIATION OF REAL ESTATE

<TABLE>
<CAPTION>
                                                                YEAR ENDED DECEMBER 31,
                                                                -----------------------
                                                        1998             1997              1996
                                                        ----             ----              ----

<S>                                                   <C>               <C>              <C>
Balance at the beginning of year                      $662,275          $429,034         $317,460
         Additions                                     143,342           246,463          135,342
         Dispositions                                  (36,760)          (13,222)         (23,768)
                                                      --------          --------         --------
Balance at close of year                              $768,857          $662,275         $429,034
                                                      ========          ========         ========
</TABLE>

           RECONCILIATION OF ACCUMULATED DEPRECIATION AND AMORTIZATION

<TABLE>
<CAPTION>
                                                                YEAR ENDED DECEMBER 31,
                                                                -----------------------
                                                        1998             1997              1996
                                                        ----             ----              ----
<S>                                                    <C>               <C>              <C>
Balance at beginning of year                           $44,352           $30,206          $21,576
         Depreciation and amortization                  20,151            14,494           10,199
         Dispositions                                   (2,246)             (348)          (1,569)
                                                       -------           -------          -------
Balance at close of year                               $62,257           $44,352          $30,206
                                                       =======           =======          =======
</TABLE>


(e)  See description of encumbrances in Note 6 to Consolidated Financial
     Statements.
(f)  Depreciation is computed based upon the following estimated lives:

<TABLE>
                  <S>                                          <C>
                  Buildings, improvements and carrying costs   31.5 to 40 years
                  Land improvements                                    15 years
                  Furniture, fixtures and equipment               4 to 15 years
</TABLE>

(g)  These 18 properties collateralize a $30,000 mortgage loan payable.
(h)  These 20 properties collateralize $50,000 of mortgage bonds payable.
(i)  These 11 properties collateralize a $8,985 mortgage loan payable.
(j)  These 2 properties collateralize a $4,108 mortgage loan payable.
(k)  These 2 properties collateralize a $2,261 mortgage loan payable.


                                      F-31