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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2010
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition
period from  to
 Commission file number 001-32649
 COGDELL SPENCER INC.
 (Exact name of registrant as specified in our charter)
 Maryland
    
    20-3126457(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)4401 Barclay Downs Drive, Suite 300
    
    28209Charlotte, North Carolina
    
    (Zip code)(Address of principal executive offices)
 Registrants telephone number, including area code:
(704) 940-2900
 Securities Registered Pursuant to Section 12(b) of the Act:
 Title of Each Class
    
    Name of Exchange on Which RegisteredCommon Stock, $0.01 par value
    
    New York Stock Exchange8.5000% Series A Cumulative Redeemable
    
    New York Stock ExchangePerpetual Preferred Stock
 Securities Registered Pursuant to Section 12(g) of the Act:
None
 o þ
 o þ
 þ o
 o o
 o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
(Do not check if a smaller reporting company)
    
    Smaller reporting company o
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE




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COGDELL SPENCER INC.
 TABLE OF CONTENTS
 PagePART IItem 1 Business
    
    
    3Item 1A Risk Factors
    
    
    10Item 1B Unresolved Staff Comments
    
    
    32Item 2 Properties
    
    
    33Item 3 Legal Proceedings
    
    
    35Item 4 Removed and Reserved
    
    
    35PART IIItem 5 Market for Registrants Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
    
    
    36Item 6 Selected Financial Data
    
    
    39Item 7 Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    41Item 7A Quantitative and Qualitative Disclosures about Market Risk
    
    
    61Item 8 Financial Statements and Supplementary Data
    
    
    62Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    107Item 9A Controls and Procedures
    
    
    107Item 9B Other Information
    
    
    109PART IIIItem 10 Directors, Executive Officers and Corporate Governance
    
    
    109Item 11 Executive Compensation
    
    
    109Item 12 Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
    
    
    109Item 13 Certain Relationships, Related Transactions, and Director Independence
    
    
    110Item 14 Principal Accounting Fees and Services
    
    
    110PART IVItem 15 Exhibits and Financial Statement Schedules
    
    
    110SIGNATURES
    
    
    114Exhibit 10.35Exhibit 21.1Exhibit 23.1Exhibit 31.1Exhibit 31.2Exhibit 32.1
  Statements Regarding Forward-Looking Information
 When used in this discussion and elsewhere in this Annual Report on Form 10-K , the words
believes, anticipates, projects, should, estimates, expects, and similar expressions
are intended to identify forward-looking statements with the meaning of that term in Section 27A of
the Securities Act of 1933, as amended (the Securities Act), and in Section 21F of the Securities
Exchange Act of 1934, as amended. Actual results may differ materially due to uncertainties
including the following:
 
    
    our business strategy;
    
    our ability to comply with financial covenants in our debt instruments;
    
    our access to capital;
    
    our ability to obtain future financing arrangements, including refinancing existing arrangements;
    
    estimates relating to our future distributions;
  2




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
    
    our understanding of our competition;
    
    our ability to renew our ground leases;
    
    legislative and regulatory changes (including changes to laws governing the taxation of REITs
and individuals);
    
    increases in costs of borrowing as a result of changes in interest rates;
    
    our ability to maintain our qualification as a REIT due to economic, market, legal, or tax
considerations;
    
    changes in the reimbursement available to our tenants by government or private payors;
    
    our tenants ability to make rent payments;
    
    defaults by tenants and customers;
    
    access to financing by customers;
    
    delays in project starts and cancellations by customers;
    
    our ability to convert design-build project opportunities into new engagements for us;
    
    market trends; and
    
    projected capital expenditures.
   
 PART I
 In this Annual Report on Form 10-K, unless the context requires otherwise, all references to we,
us, our, our Company, and Cogdell Spencer refer to Cogdell Spencer Inc. and its
consolidated subsidiaries, including Cogdell Spencer LP, our
operating partnership subsidiary (the Operating
Partnership)..
 
 Item 1.
    
    Business
  3




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The Company
      
    
    65 consolidated wholly-owned and joint venture properties, comprising a total of
approximately 3.6 million net rentable square feet, 90.6% leased;
 
    
    one wholly-owned property in the lease-up phase, comprising approximately 0.1 million
net rentable square feet, 75% leased and income producing with the remaining 25.0% leased
and under construction for a third quarter 2011 scheduled date of occupancy;
 
    
    three unconsolidated joint venture properties comprising a total of approximately 0.2
million net rentable square feet; and
 
    
    44 properties managed for third party clients comprising a total of approximately 2.0
million net rentable square feet.
   Our Taxable REIT Subsidiaries (TRSs)
   4




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Business and Growth Strategies
  Operating Strategy
  
    
    Strong Relationships with Physicians and Hospitals.
  
    
    Active Management of our Properties.
  
    
    Preferred Locations.
  
    
    Loyal and Diverse Tenant Base.
  
    
    Differentiated Focus.
   5




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Development and Acquisition Strategy
  
    
    Project delivery.
  
    
    Selective Development and Acquisitions.
  
    
    Develop and Maintain Strategic Relationships.
  
    
    Investment Criteria and Financing.
     6




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Business Segments
   Regulation
      7




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Environmental Matters
    8




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Insurance
     Competition
   Employees
  Equity Offerings
    9




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Available Information
  
 Item 1A.
    
    Risk Factors
 Many risk factors affect our business. The occurrence of a risk factor may reduce our operating
income, decrease the value of our assets, diminishing our growth prospects, or impact access to and
cost of capital. As a result, we may have reduced cash available for distribution and/or our share
price may decline.
 Risks Related to our Properties and Operations
 Our real estate investments are concentrated in medical office buildings and healthcare facilities,
making us more vulnerable economically than if our investments were diversified.
  We depend on significant tenants.
  The severely weakened economy, and other events or circumstances beyond our control, may adversely
affect our industry, business, results of operations, contractual commitments, and access to
capital.
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Adverse economic or other conditions in the markets in which we do business may negatively affect
our occupancy levels and rental rates and therefore our operating results.
  
    
    periods of economic slowdown or recession, rising interest rates or declining demand
for medical office buildings and healthcare facilities, or the public perception that any
of these events may occur, could result in a general decline in rental rates or an
increase in tenant defaults;
 
    
    the national economic climate in which we operate, may be adversely impacted by, among
other factors, a reduction in the availability of debt or equity financing, industry
slowdowns, relocation of businesses and changing demographics;
 
    
    local or regional real estate market conditions such as the oversupply of medical
office buildings and healthcare facilities or a reduction in demand for medical office
buildings and healthcare facilities in a particular area;
 
    
    negative perceptions by prospective tenants of the safety, convenience and
attractiveness of our properties and the neighborhoods in which they are located;
 
    
    earthquakes and other natural disasters, terrorist acts, civil disturbances or acts of
war which may result in uninsured or underinsured losses; and
 
    
    changes in tax, real estate and zoning laws.
  The majority of our consolidated wholly-owned and joint venture properties are located in Georgia,
North Carolina, and South Carolina, and changes in these markets may materially adversely affect
us.
  Our investments in development and redevelopment projects may not yield anticipated returns, which
would harm our operating results and reduce the amount of funds available for distributions.
  
    
    we may be unable to obtain financing for these projects on attractive terms or at all;
 
    
    we may not complete development projects on schedule or within budgeted amounts;
 
    
    we may encounter delays or denials in obtaining all necessary zoning, land use,
building, occupancy and other required governmental permits and authorizations;
 
    
    occupancy rates and rents at newly developed or redeveloped properties may fluctuate
depending on a number of factors, including market and economic conditions, and may result
in our investment not being profitable; and
 
    
    start-up costs may be higher than anticipated.
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We may not be successful in identifying and consummating suitable acquisitions or investment
opportunities, which may impede our growth and negatively affect our results of operations.
   
    
    failure to finance an acquisition on attractive terms or at all;
 
    
    competition from other real estate investors with significant capital, including other
publicly-traded REITs and institutional investment funds;
 
    
    competition from other potential acquirers may significantly increase the purchase
price for an acquisition property, which could reduce our profitability;
 
    
    unsatisfactory results of our due diligence investigations or failure to meet other
customary closing conditions;
 
    
    we may spend more than the time and amounts budgeted to make necessary improvements or
renovations to acquired properties; and
 
    
    we may acquire properties subject to liabilities and without any recourse, or with only
limited recourse, with respect to unknown liabilities such as liabilities for clean-up of
undisclosed environmental contamination, claims by persons in respect of events
transpiring or conditions existing before we acquired the properties and claims for
indemnification by general partners, directors, officers and others indemnified by the
former owners of the properties.
  We may not be able to obtain additional capital to further our business objectives.
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If we are unable to promptly re-let our properties, if the rates upon such re-letting are
significantly lower than expected, or if we are required to undertake significant capital
expenditures to attract new tenants, then our business and results of operations would be adversely
affected.
  Certain of our properties may not have efficient alternative uses.
  We face competition for the acquisition of medical facilities, which may impede our ability to make
future acquisitions or may increase the cost of these acquisitions.
  We may not be successful in integrating and operating acquired properties.
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Our medical facilities, their associated hospitals and our tenants may be unable to compete
successfully.
    Uninsured losses or losses in excess of our insurance coverage could adversely affect our financial
condition and our cash flow.
  Joint investments could be adversely affected by our lack of sole decision-making authority and
reliance upon a co-venturers financial condition.
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Our mortgage agreements and ground and air rights leases contain certain provisions that may limit
our ability to sell certain of our medical office buildings and healthcare facilities.
  
    
    obtain the consent of the lender;
 
    
    pay a fee equal to a fixed percentage of the outstanding loan balance; and
 
    
    pay any costs incurred by the lender in connection with any such assignment or
transfer.
  31 of our consolidated wholly-owned and joint venture properties are subject to ground or air
rights leases that expose us to the loss of such properties upon breach or termination of the
ground or air rights leases.
  Environmental compliance costs and liabilities associated with operating our properties may affect
our results of operations.
    15




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Costs associated with complying with the Americans with Disabilities Act of 1990 may result in
unanticipated expenses.
  The bankruptcy or insolvency of our tenants under our leases could seriously harm our operating
results and financial condition.
     16




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Risks Related to our Design-Build and Development Segment
 Continuing adverse economic conditions could cause our clients to delay, curtail or cancel proposed
or existing projects, which could result in a decrease in demand for our services.
  Our results of operations depend upon the award of new design-build contracts and the nature and
timing of those awards.
   If we experience delays and/or defaults in client payments, we could be unable to recover all
expenditures.
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We may experience reduced profits or, in some cases, losses under our guaranteed maximum price
contracts if costs increase above our estimates.
  The nature of our design-build and development business creates exposure to potential liabilities
and disputes which may reduce our profits.
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Environmental compliance costs and liabilities associated with our business may affect our results
of operation.
  
    
    generation, storage, handling, treatment and disposal of hazardous material and wastes;
 
    
    emissions into the air;
 
    
    discharges into waterways; and
 
    
    health and safety.
    Risks Related to the Healthcare Industry
 Future changes to healthcare laws, implementation of healthcare legislation and adverse trends in
healthcare provider operations may negatively affect our lease revenues and our ability to make
distributions to our stockholders.
  
    
    changes in the demand for and methods of delivering healthcare services;
    
    changes in third party reimbursement policies;
    
    substantial competition for patients among healthcare providers;
    
    continued pressure by private and government payors to reduce payments to providers
of services; and
    
    increased scrutiny of billing, referral and other practices by U.S. federal and
state authorities.
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Reductions in reimbursement from third party payors, including Medicare and Medicaid, could
adversely affect the profitability of our tenants and hinder their ability to make rent payments to
us.
  The healthcare industry is heavily regulated, and new laws or regulations, changes to existing laws
or regulations, loss of licensure or failure to obtain licensure could result in the inability of
our tenants to make rent payments to us.
    20




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Our tenants are subject to the Stark Law and fraud and abuse laws, the violation of which by a
tenant may jeopardize the tenants ability to make rent payments to us.
   
    
    the Federal Anti-Kickback Statute, which prohibits, among other things, the offer,
payment, solicitation or receipt of any form of remuneration in return for, or to
induce, the referral of Medicare and Medicaid patients;
    
    the Stark Law, which, subject to specific exceptions, restricts physicians who have
financial relationships with healthcare providers from making referrals for
specifically designated health services for which payment may be made under Medicare
or Medicaid programs to an entity with which the physician, or an immediate family
member, has a financial relationship;
    
    the False Claims Act, which prohibits any person from knowingly presenting false or
fraudulent claims for payment to the federal government, including under the Medicare
and Medicaid programs; and
    
    the Civil Monetary Penalties Law, which authorizes the Department of Health and
Human Services to impose monetary penalties for certain fraudulent acts.
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Risks Related to the Real Estate Industry
 Illiquidity of real estate investments could significantly impede our ability to respond to adverse
changes in the performance of our properties.
   Any investments in unimproved real property may take significantly longer to yield income-producing
returns, if at all, and may result in additional costs to us to comply with re-zoning restrictions
or environmental regulations.
  Risks Related to Debt Financings
 Required payments of principal
and interest on borrowings may leave us with insufficient cash to operate our properties or to
pay the distributions currently contemplated or necessary to qualify as a REIT and may expose us
to the risk of default under our debt obligations.
   22




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
    
    our cash flow may be insufficient to meet our required principal and interest payments;
 
    
    we may be unable to borrow additional funds as needed or on favorable terms, including
to make acquisitions;
 
    
    we may be unable to refinance our indebtedness at maturity or the refinancing terms may
be less favorable than the terms of our original indebtedness;
 
    
    because a portion of our debt bears interest at variable rates, an increase in interest
rates could materially increase our interest expense;
 
    
    we may be forced to dispose of one or more of our properties, possibly on
disadvantageous terms;
 
    
    after debt service, the amount available for distributions to our stockholders is
reduced;
 
    
    our debt level could place us at a competitive disadvantage compared to our competitors
with less debt;
 
    
    we may experience increased vulnerability to economic and industry downturns, reducing
our ability to respond to changing business and economic conditions;
 
    
    we may default on our obligations and the lenders or mortgagees may foreclose on our
properties that secure their loans and receive an assignment of rents and leases;
 
    
    we may violate financial covenants which would cause a default on our obligations;
 
    
    we may inadvertently violate non-financial restrictive covenants in our loan documents,
such as covenants that require us to maintain the existence of entities, maintain
insurance policies and provide financial statements, which would entitle the lenders to
accelerate our debt obligations; and
 
    
    we may default under any one of our mortgage loans with cross-default or
cross-collateralization provisions that could result in default on other indebtedness or
result in the foreclosures of other properties.
  As a result of recent market events, including the contraction among and failure of certain
lenders, it may be more difficult for us to secure financing.
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Our ability to pay distributions is dependent on a number of factors and is not assured, and our
distributions to stockholders may decline at any time.
  Our outstanding debt obligations prohibit us from redeeming the Series A Preferred Stock.
  Our organizational documents contain no limitations on the amount of debt we may incur.
  Increases in interest rates may increase our interest expense and adversely affect our cash flow
and our ability to service our indebtedness and make distributions to our stockholders.
  Failure to hedge effectively against interest rate changes may adversely affect our results of
operations.
   24




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Our Credit Facility contains covenants that could limit our operations and our ability to make
distributions to our stockholders.
    If lenders under our Credit Facility fail to meet their funding commitments, our financial position
would be negatively impacted.
  Risks Related to our Organization and Structure
 Our business could be harmed if key personnel terminate their employment with us.
  Tax indemnification obligations could limit our operating flexibility by limiting our ability to
sell specified properties.
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Tax indemnification obligations may require the Operating Partnership to maintain certain debt
levels.
  We may pursue less vigorous enforcement of terms of contribution and other agreements because of
conflicts of interest with certain of our directors and officers.
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Conflicts of interest could arise as a result of our UPREIT structure.
     Certain provisions of our organizational documents, including the stock ownership limit imposed by
our charter, could prevent or delay a change in control transaction.
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Certain provisions of Maryland law may limit the ability of a third party to acquire control of us.
  
    
    business combination provisions that, subject to certain limitations, prohibit
certain business combinations between us and an interested stockholder (defined
generally as any person who beneficially owns 10% or more of the voting power of our
 shares or an affiliate thereof) for five years after the most recent date on which the
stockholder becomes an interested stockholder, and thereafter impose special minimum price
provisions and special stockholder voting requirements on these combinations; and
 
    
    control share provisions that provide that control shares of us (defined as shares
which, when aggregated with other shares controlled by the stockholder, entitle the
stockholder to exercise one of three increasing ranges of voting power in electing
directors) acquired in a control share acquisition (defined as the direct or indirect
acquisition of ownership or control of control shares) have no voting rights except to
the extent approved by our stockholders by the affirmative vote of at least two-thirds of
all the votes entitled to be cast on the matter, excluding all interested shares.
   The Board of Directors has the power to cause us to issue additional shares of our stock and the
general partner has the power to issue additional OP units without stockholder approval.
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Our rights and the rights of our stockholders to take action to recover money damages from our
directors and officers are limited.
  You will have limited ability as a stockholder to prevent us from making any changes to we policies
that you believe could harm our business, prospects, operating results or share price.
  To the extent our distributions represent a return of capital for U.S. federal income tax purposes
you could recognize an increased capital gain upon a subsequent sale by you of our common stock or
preferred stock.
  Risks Related to Qualification and Operation as a REIT
 Our failure to qualify or remain qualified as a REIT would have significant adverse consequences to
us.
  
    
    we would not be allowed a deduction for distributions to stockholders in computing our
taxable income and we would be subject to U.S. federal income tax at regular corporate
rates;
 
    
    we also could be subject to the U.S. federal alternative minimum tax and possibly
increased state and local taxes; and
 
    
    unless we are entitled to relief under applicable statutory provisions, we could not
elect to be taxed as a REIT for four taxable years following a year during which we were
disqualified.
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To maintain its REIT qualification, we may be forced to borrow funds during unfavorable market
conditions.
  Dividends payable by REITs generally do not qualify for reduced tax rates.
   Possible legislative or other actions affecting REITs could adversely affect us and our
stockholders.
  Complying with REIT requirements may cause we to forego otherwise attractive opportunities.
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We will pay some taxes.
  The ability of the Board of Directors to revoke our REIT election without stockholder approval may
cause adverse consequences to our stockholders.
  Our ability to invest in TRSs is limited by our qualification as a REIT, and accordingly may limit
our ability to grow the business of the Design-Build and Development segment.
  If the aggregate value of the securities we own in its TRSs were determined to be in excess of 25%
of the value of its total assets, we could fail to qualify as a REIT or be subject to a penalty tax
and forced to dispose of TRS securities.
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If the IRS were to successfully challenge our valuation of certain of its subsidiaries, we may fail
to qualify as a REIT.
  
 Item 1B.
    
    Unresolved Staff Comments
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Item 2.
    
    Properties
  AnnualizedRent PerNet Rentable
    
    
    Occupancy
    
    
    Annualized
    
    
    LeasedLocation
    
    Ownership
    
    
    Square Feet
    
    
    Rate
    
    
    Rent
    
    
    Square FootCaliforniaVerdugo Hills Professional Bldg I
    
    Glendale
    
    
    100.0
    %
    
    
    64,056
    
    
    
    93.1
    %
    
    $
    1,930,055
    
    
    $
    32.35Verdugo Hills Professional Bldg II
    
    Glendale
    
    
    100.0
    %
    
    
    42,906
    
    
    
    99.5
    %
    
    
    1,439,002
    
    
    
    33.70106,962
    
    
    
    95.7
    %
    
    
    3,369,057
    
    
    
    32.91FloridaWoodlands Center for Specialized Medicine
    
    Pensacola
    
    
    40.0
    %
    
    
    75,985
    
    
    
    100.0
    %
    
    
    2,452,055
    
    
    
    32.27GeorgiaAugusta POB I
    
    Augusta
    
    
    100.0
    %
    
    
    99,494
    
    
    
    93.2
    %
    
    
    1,356,650
    
    
    
    14.63Augusta POB II
    
    Augusta
    
    
    100.0
    %
    
    
    125,634
    
    
    
    87.6
    %
    
    
    2,304,051
    
    
    
    20.93Augusta POB III
    
    Augusta
    
    
    100.0
    %
    
    
    47,034
    
    
    
    90.0
    %
    
    
    909,175
    
    
    
    21.48Augusta POB IV
    
    Augusta
    
    
    100.0
    %
    
    
    55,134
    
    
    
    83.1
    %
    
    
    895,774
    
    
    
    19.54Summit Professional Plaza I
    
    Brunswick
    
    
    100.0
    %
    
    
    33,039
    
    
    
    93.5
    %
    
    
    858,710
    
    
    
    27.80Summit Professional Plaza II
    
    Brunswick
    
    
    100.0
    %
    
    
    64,233
    
    
    
    96.7
    %
    
    
    1,760,881
    
    
    
    28.34424,568
    
    
    
    90.5
    %
    
    
    8,085,241
    
    
    
    21.05IndianaMethodist Professional Center I (1)
    
    Indianapolis
    
    
    100.0
    %
    
    
    150,243
    
    
    
    95.2
    %
    
    
    3,480,256
    
    
    
    24.34Methodist Professional Center II (sub-lease)
    
    Indianapolis
    
    
    100.0
    %
    
    
    24,080
    
    
    
    100.0
    %
    
    
    653,679
    
    
    
    27.15174,323
    
    
    
    95.8
    %
    
    
    4,133,935
    
    
    
    24.75KentuckyOLBH Same Day Surgery Center and MOB
    
    Ashland
    
    
    100.0
    %
    
    
    46,907
    
    
    
    95.7
    %
    
    
    978,786
    
    
    
    21.81OLBH Parking Garage
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    890,96246,907
    
    
    
    95.7
    %
    
    
    1,869,748
    
    
    
    21.81
    (2)LouisianaEast Jefferson MOB
    
    Metairie
    
    
    100.0
    %
    
    
    119,921
    
    
    
    99.1
    %
    
    
    2,574,872
    
    
    
    21.67East Jefferson Medical Plaza
    
    Metairie
    
    
    100.0
    %
    
    
    123,184
    
    
    
    100.0
    %
    
    
    2,785,905
    
    
    
    22.62East Jefferson MRI
    
    Metairie
    
    
    100.0
    %
    
    
    10,809
    
    
    
    100.0
    %
    
    
    995,663
    
    
    
    92.11253,914
    
    
    
    99.6
    %
    
    
    6,356,440
    
    
    
    25.14MinnesotaHealth Partners Medical & Dental Clinics
    
    Sartell
    
    
    100.0
    %
    
    
    60,108
    
    
    
    94.9
    %
    
    
    1,970,692
    
    
    
    34.54MississippiUniversity Physicians  Grants Ferry
    
    Flowood
    
    
    100.0
    %
    
    
    50,575
    
    
    
    100.0
    %
    
    
    1,619,447
    
    
    
    32.02New YorkCentral NY Medical Center (3)
    
    Syracuse
    
    
    100.0
    %
    
    
    111,634
    
    
    
    97.8
    %
    
    
    2,918,133
    
    
    
    26.73North CarolinaAlamance Regional Mebane Outpatient Center
    
    Mebane
    
    
    35.1
    %
    
    
    68,206
    
    
    
    71.1
    %
    
    
    1,853,215
    
    
    
    38.24Barclay Downs
    
    Charlotte
    
    
    100.0
    %
    
    
    38,395
    
    
    
    100.0
    %
    
    
    645,085
    
    
    
    16.80Birkdale Bldgs C, D, E and Birkdale Wellness
    
    Huntersville
    
    
    100.0
    %
    
    
    64,669
    
    
    
    96.4
    %
    
    
    1,389,705
    
    
    
    22.29Birkdale II
    
    Huntersville
    
    
    100.0
    %
    
    
    8,269
    
    
    
    100.0
    %
    
    
    203,672
    
    
    
    24.63Copperfield Medical Mall
    
    Concord
    
    
    100.0
    %
    
    
    26,000
    
    
    
    100.0
    %
    
    
    631,660
    
    
    
    24.29East Rocky Mount Kidney Center
    
    Rocky Mount
    
    
    100.0
    %
    
    
    8,043
    
    
    
    100.0
    %
    
    
    161,232
    
    
    
    20.05English Road Medical Center
    
    Rocky Mount
    
    
    34.5
    %
    
    
    35,393
    
    
    
    95.7
    %
    
    
    950,728
    
    
    
    28.08Gaston Professional & Ambulatory Surgery Centers
    
    Gastonia
    
    
    100.0
    %
    
    
    114,956
    
    
    
    100.0
    %
    
    
    2,739,964
    
    
    
    23.83Gaston Parking
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    606,141Gateway Medical Office Building
    
    Concord
    
    
    100.0
    %
    
    
    61,789
    
    
    
    69.1
    %
    
    
    1,119,819
    
    
    
    26.21Harrisburg Family Physicians
    
    Harrisburg
    
    
    100.0
    %
    
    
    8,202
    
    
    
    100.0
    %
    
    
    224,301
    
    
    
    27.35Harrisburg Medical Mall
    
    Harrisburg
    
    
    100.0
    %
    
    
    18,360
    
    
    
    100.0
    %
    
    
    500,851
    
    
    
    27.28Lincoln/Lakemont Family Practice
    
    Lincolnton
    
    
    100.0
    %
    
    
    16,500
    
    
    
    100.0
    %
    
    
    397,713
    
    
    
    24.10Mallard Crossing Medical Park
    
    Charlotte
    
    
    100.0
    %
    
    
    52,540
    
    
    
    66.0
    %
    
    
    858,662
    
    
    
    24.77Medical Arts Building
    
    Concord
    
    
    100.0
    %
    
    
    84,972
    
    
    
    93.3
    %
    
    
    1,817,675
    
    
    
    22.93Midland Medical Park
    
    Midland
    
    
    100.0
    %
    
    
    14,610
    
    
    
    100.0
    %
    
    
    441,985
    
    
    
    30.25Mulberry Medical Park
    
    Lenoir
    
    
    100.0
    %
    
    
    24,992
    
    
    
    87.0
    %
    
    
    467,570
    
    
    
    21.50Northcross Family Physicians
    
    Charlotte
    
    
    100.0
    %
    
    
    8,018
    
    
    
    100.0
    %
    
    
    234,496
    
    
    
    29.25Randolph Medical Park
    
    Charlotte
    
    
    100.0
    %
    
    
    84,131
    
    
    
    69.2
    %
    
    
    1,292,498
    
    
    
    22.21
  33




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##### Table of Contents



AnnualizedRent PerNet Rentable
    
    
    Occupancy
    
    
    Annualized
    
    
    LeasedLocation
    
    Ownership
    
    
    Square Feet
    
    
    Rate
    
    
    Rent
    
    
    Square FootNorth Carolina (continued)Rocky Mount Kidney Center
    
    Rocky Mount
    
    
    100.0
    %
    
    
    10,105
    
    
    
    100.0
    %
    
    
    202,567
    
    
    
    20.05Rocky Mount Medical Park
    
    Rocky Mount
    
    
    100.0
    %
    
    
    96,993
    
    
    
    100.0
    %
    
    
    2,091,904
    
    
    
    21.57Rowan Outpatient Surgery Center
    
    Salisbury
    
    
    100.0
    %
    
    
    19,464
    
    
    
    100.0
    %
    
    
    435,162
    
    
    
    22.36Weddington Internal & Pediatric Medicine
    
    Concord
    
    
    100.0
    %
    
    
    7,750
    
    
    
    100.0
    %
    
    
    203,224
    
    
    
    26.22872,357
    
    
    
    89.1
    %
    
    
    19,469,829
    
    
    
    24.28
    (2)PennsylvaniaLancaster Rehabilitation Hospital
    
    Lancaster
    
    
    100.0
    %
    
    
    57,508
    
    
    
    100.0
    %
    
    
    1,484,740
    
    
    
    25.82Lancaster ASC MOB
    
    Lancaster
    
    
    80.9
    %
    
    
    64,214
    
    
    
    100.0
    %
    
    
    2,130,199
    
    
    
    33.17121,722
    
    
    
    100.0
    %
    
    
    3,614,939
    
    
    
    29.70South Carolina200 Andrews
    
    Greenville
    
    
    100.0
    %
    
    
    25,902
    
    
    
    100.0
    %
    
    
    628,047
    
    
    
    24.25Beaufort Medical Plaza
    
    Beaufort
    
    
    100.0
    %
    
    
    59,340
    
    
    
    100.0
    %
    
    
    1,346,384
    
    
    
    22.69Carolina Forest Medical Plaza
    
    Myrtle Beach
    
    
    100.0
    %
    
    
    38,902
    
    
    
    43.5
    %
    
    
    533,125
    
    
    
    31.53Mary Black Westside Medical Office Bldg
    
    Spartanburg
    
    
    100.0
    %
    
    
    37,455
    
    
    
    100.0
    %
    
    
    728,004
    
    
    
    19.44Medical Arts Center of Orangeburg
    
    Orangeburg
    
    
    100.0
    %
    
    
    49,324
    
    
    
    78.0
    %
    
    
    766,672
    
    
    
    19.94Mount Pleasant Medical Office Long Point
    
    Mt. Pleasant
    
    
    100.0
    %
    
    
    38,735
    
    
    
    77.4
    %
    
    
    795,812
    
    
    
    26.55One Medical Park
    
    Columbia
    
    
    100.0
    %
    
    
    69,840
    
    
    
    83.9
    %
    
    
    1,448,084
    
    
    
    24.73Palmetto Health Parkridge
    
    Columbia
    
    
    100.0
    %
    
    
    89,451
    
    
    
    94.6
    %
    
    
    2,147,120
    
    
    
    25.37Providence MOB I
    
    Columbia
    
    
    100.0
    %
    
    
    48,500
    
    
    
    82.0
    %
    
    
    879,088
    
    
    
    22.10Providence MOB II
    
    Columbia
    
    
    100.0
    %
    
    
    23,280
    
    
    
    88.8
    %
    
    
    424,702
    
    
    
    20.55Providence MOB III
    
    Columbia
    
    
    100.0
    %
    
    
    54,417
    
    
    
    73.3
    %
    
    
    783,493
    
    
    
    19.64River Hills Medical Plaza
    
    Little River
    
    
    100.0
    %
    
    
    27,566
    
    
    
    70.9
    %
    
    
    637,881
    
    
    
    32.63Roper Medical Office Building
    
    Charleston
    
    
    100.0
    %
    
    
    122,785
    
    
    
    84.7
    %
    
    
    2,223,487
    
    
    
    21.37St. Francis CMOB
    
    Greenville
    
    
    100.0
    %
    
    
    45,140
    
    
    
    96.6
    %
    
    
    1,154,968
    
    
    
    26.49St. Francis Medical Plaza (Charleston)
    
    Charleston
    
    
    100.0
    %
    
    
    28,734
    
    
    
    100.0
    %
    
    
    840,813
    
    
    
    29.26St. Francis Medical Plaza (Greenville)
    
    Greenville
    
    
    100.0
    %
    
    
    62,724
    
    
    
    67.6
    %
    
    
    825,515
    
    
    
    19.46St. Francis Outpatient Surgery Center
    
    Greenville
    
    
    100.0
    %
    
    
    72,491
    
    
    
    100.0
    %
    
    
    2,169,417
    
    
    
    29.93St. Francis Professional Medical Center
    
    Greenville
    
    
    100.0
    %
    
    
    49,767
    
    
    
    100.0
    %
    
    
    1,131,301
    
    
    
    22.73St. Francis Womens
    
    Greenville
    
    
    100.0
    %
    
    
    57,590
    
    
    
    79.2
    %
    
    
    972,590
    
    
    
    21.31Three Medical Park
    
    Columbia
    
    
    100.0
    %
    
    
    88,755
    
    
    
    82.3
    %
    
    
    1,722,577
    
    
    
    23.601,090,698
    
    
    
    85.3
    %
    
    
    22,159,080
    
    
    
    23.81TennesseeHealth Park Medical Office Building
    
    Chattanooga
    
    
    100.0
    %
    
    
    52,151
    
    
    
    88.8
    %
    
    
    1,730,882
    
    
    
    37.38Peerless Crossing Medical Center
    
    Cleveland
    
    
    100.0
    %
    
    
    40,506
    
    
    
    100.0
    %
    
    
    1,008,848
    
    
    
    24.9192,657
    
    
    
    93.7
    %
    
    
    2,739,730
    
    
    
    31.56VirginiaMRMC MOB I
    
    Mechanicsville
    
    
    100.0
    %
    
    
    56,610
    
    
    
    77.2
    %
    
    
    1,275,077
    
    
    
    29.19St. Marys MOB North  (Floors 6 & 7)
    
    Richmond
    
    
    100.0
    %
    
    
    30,617
    
    
    
    100.0
    %
    
    
    783,450
    
    
    
    25.5987,227
    
    
    
    85.2
    %
    
    
    2,058,527
    
    
    
    27.71Total
    
    
    
    
    
    
    
    
    3,569,637
    
    
    
    90.6
    %
    
    $
    82,816,853
    
    
    $
    25.14
    (2)
 
 (1)
    
    Parking revenue from an adjacent parking deck is approximately $90,000
per month, or $1,080,000 annualized.(2)
    
    Excludes annualized rent of adjacent parking decks to OLBH Same Day Surgery Center
and MOB and Gaston Professional Center from calculation.(3)
    
    Parking revenue from an adjacent parking deck is approximately $100,000 per month,
or $1,200,000 annualized.  34




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##### Table of Contents



Percentage of
    
    
    
    
    
    
    Percentage of
    
    
    Annualized RentNumber of
    
    
    Net Rentable
    
    
    Net Rentable
    
    
    Annualized
    
    
    Property
    
    
    Per LeasedLeases Expiring
    
    
    Square Feet
    
    
    Square Feet
    
    
    Rent
    
    
    Annualized Rent
    
    
    Square FootAvailable
    
    
    
    
    
    
    335,140
    
    
    
    9.4
    %
    
    $
    
    
    
    
    
    
    
    $
    2011
    
    
    118
    
    
    
    380,104
    
    
    
    10.6
    %
    
    
    8,822,530
    
    
    
    10.7
    %
    
    
    23.212012
    
    
    137
    
    
    
    563,865
    
    
    
    15.8
    %
    
    
    15,488,211
    
    
    
    18.7
    %
    
    
    24.81
    (1)2013
    
    
    88
    
    
    
    371,802
    
    
    
    10.4
    %
    
    
    8,558,824
    
    
    
    10.3
    %
    
    
    23.022014
    
    
    80
    
    
    
    367,583
    
    
    
    10.3
    %
    
    
    9,143,332
    
    
    
    11.0
    %
    
    
    24.872015
    
    
    69
    
    
    
    266,544
    
    
    
    7.5
    %
    
    
    6,117,214
    
    
    
    7.4
    %
    
    
    22.952016
    
    
    31
    
    
    
    150,487
    
    
    
    4.2
    %
    
    
    3,093,863
    
    
    
    3.7
    %
    
    
    20.562017
    
    
    47
    
    
    
    285,658
    
    
    
    8.0
    %
    
    
    7,617,039
    
    
    
    9.2
    %
    
    
    26.662018
    
    
    19
    
    
    
    112,358
    
    
    
    3.1
    %
    
    
    2,886,922
    
    
    
    3.5
    %
    
    
    25.692019
    
    
    19
    
    
    
    143,101
    
    
    
    4.0
    %
    
    
    3,188,922
    
    
    
    3.9
    %
    
    
    22.282020
    
    
    13
    
    
    
    87,324
    
    
    
    2.4
    %
    
    
    2,017,720
    
    
    
    2.4
    %
    
    
    23.11Thereafter
    
    
    17
    
    
    
    505,671
    
    
    
    14.2
    %
    
    
    15,882,276
    
    
    
    19.2
    %
    
    
    31.41Total
    
    
    638
    
    
    
    3,569,637
    
    
    
    100.0
    %
    
    $
    82,816,853
    
    
    
    100.0
    %
    
    $
    25.14
    (1)
 
 (1)
    
    Excludes annualized rent of adjacent parking decks to OLBH Same Day Surgery Center
and MOB and Gaston Professional Center from calculation.  
 Item 3.
    
    Legal Proceedings
  
 Item 4.
    
    Removed and Reserved
  35




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##### Table of Contents



PART II
 
 Item 5.
    
    Market for Registrants Common Equity and Related Stockholder
Matters and Issuer Purchases of Equity Securities
 Market Information
  DividendsPeriod
    
    High
    
    
    Low
    
    
    Declared2009First Quarter
    
    $
    10.00
    
    
    $
    4.50
    
    
    $
    0.225Second Quarter
    
    $
    6.40
    
    
    $
    3.65
    
    
    $
    0.10Third Quarter
    
    $
    5.25
    
    
    $
    3.87
    
    
    $
    0.10Fourth Quarter
    
    $
    5.82
    
    
    $
    4.53
    
    
    $
    0.102010First Quarter
    
    $
    7.65
    
    
    $
    5.66
    
    
    $
    0.10Second Quarter
    
    $
    8.35
    
    
    $
    6.37
    
    
    $
    0.10Third Quarter
    
    $
    7.53
    
    
    $
    6.07
    
    
    $
    0.10Fourth Quarter
    
    $
    6.91
    
    
    $
    5.72
    
    
    $
    0.10
       36




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##### Table of Contents



Stockholder Return Performance
  
 Period EndingIndex
    
    12/31/05
    
    
    12/31/06
    
    
    12/31/07
    
    
    12/31/08
    
    
    12/31/09
    
    
    12/31/10Cogdell Spencer Inc.
    
    
    100.00
    
    
    
    136.17
    
    
    
    108.84
    
    
    
    67.92
    
    
    
    46.85
    
    
    
    50.93NAREIT Equity
    
    
    100.00
    
    
    
    135.06
    
    
    
    113.87
    
    
    
    70.91
    
    
    
    90.76
    
    
    
    116.13S&P 500
    
    
    100.00
    
    
    
    115.79
    
    
    
    122.16
    
    
    
    76.96
    
    
    
    97.33
    
    
    
    111.99
  Unregistered Sales of Equity Securities and Use of Proceeds
    37




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##### Table of Contents



Issuer Purchases of Equity Securities
  Equity Compensation Plan Information
 (a)
    
    
    
    
    
    
    (c)Number of
    
    
    
    
    
    
    Number of SecuritiesSecurities to be
    
    
    (b)
    
    
    Remaining Available forIssued Upon
    
    
    Weighted Average
    
    
    Future Issuance UnderExercise of
    
    
    Exercise Price of
    
    
    Equity CompensationOutstanding
    
    
    Outstanding
    
    
    Plans (ExcludingOptions, Warrants,
    
    
    Options, Warrants,
    
    
    Securities Reflected inPlan Category
    
    and Rights
    
    
    and Rights
    
    
    Columns (a))Equity compensation plans approved by security holders
    
    
    N/A
    (1)
    
    
    N/A
    
    
    
    997,738Equity compensation plans not approved by security
holders
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    N/A
    (1)
    
    
    N/A
    
    
    
    997,738
 (1)
    
    These amounts include information related to our 2005 and 2010 Long-term Incentive
Plans. As of December 31, 2010, we issued 631,223
shares of restricted stock and 883,039 Long-term Incentive Plan (LTIP) units under this plan.  38




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##### Table of Contents



Item 6.
    
    Selected Financial Data
  For the year ended December 31,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006(In thousand, except per share amounts)Statements of Operations Data:Rental revenue
    
    $
    87,803
    
    
    $
    79,486
    
    
    $
    77,421
    
    
    $
    62,611
    
    
    $
    52,007Design-Build contract revenue and other sales
    
    
    91,256
    
    
    
    143,416
    
    
    
    253,596
    
    
    
    
    
    
    
    Total revenues
    
    
    182,417
    
    
    
    229,601
    
    
    
    335,362
    
    
    
    66,403
    
    
    
    54,217Property operating and management expenses
    
    
    33,664
    
    
    
    31,810
    
    
    
    31,065
    
    
    
    25,405
    
    
    
    19,572Costs related to design-build contract revenue and other sales
    
    
    72,001
    
    
    
    113,961
    
    
    
    214,019
    
    
    
    
    
    
    
    Selling, general, and administrative expenses
    
    
    30,411
    
    
    
    32,285
    
    
    
    30,215
    
    
    
    7,365
    
    
    
    6,261Income (loss) from continuing operations before other
income (expense), and income tax benefit (expense)
    
    
    (113,541
    )
    
    
    (103,877
    )
    
    
    15,184
    
    
    
    6,021
    
    
    
    (1,359
    )Interest expense
    
    
    (21,994
    )
    
    
    (21,711
    )
    
    
    (25,017
    )
    
    
    (15,818
    )
    
    
    (14,046
    )Loss from continuing operations
    
    
    (118,886
    )
    
    
    (100,435
    )
    
    
    (7,645
    )
    
    
    (8,821
    )
    
    
    (13,808
    )Net loss
    
    
    (118,616
    )
    
    
    (101,962
    )
    
    
    (7,857
    )
    
    
    (8,994
    )
    
    
    (14,034
    )Net loss available to Cogdell Spencer Inc. common shareholders
    
    
    (104,089
    )
    
    
    (69,728
    )
    
    
    (5,773
    )
    
    
    (6,341
    )
    
    
    (9,097
    )Per Share  basic and diluted:Declared dividend
    
    $
    0.40
    
    
    $
    0.525
    
    
    $
    1.275
    
    
    $
    1.40
    
    
    $
    1.40Loss from continuing operations available to Cogdell Spencer Inc.
common shareholders
    
    $
    (2.20
    )
    
    $
    (2.10
    )
    
    $
    (0.36
    )
    
    $
    (0.56
    )
    
    $
    (1.16
    )Income (loss) from discontinued operations available to Cogdell
Spencer Inc. common shareholders
    
    $
    
    
    
    $
    (0.03
    )
    
    $
    (0.01
    )
    
    $
    (0.01
    )
    
    $
    (0.01
    )Net loss per share available to Cogdell Spencer Inc. common shareholders
    
    $
    (2.20
    )
    
    $
    (2.14
    )
    
    $
    (0.37
    )
    
    $
    (0.57
    )
    
    $
    (1.17
    )Weighted average shares  basic and diluted
    
    
    47,456
    
    
    
    32,655
    
    
    
    15,770
    
    
    
    11,056
    
    
    
    7,975Weighted average shares and OP units  basic and diluted
    
    
    55,206
    
    
    
    40,616
    
    
    
    24,098
    
    
    
    15,637
    
    
    
    12,612Selected Balance Sheet Data (as of the end of the period):Assets:Real estate properties, net
    
    $
    537,393
    
    
    $
    511,215
    
    
    $
    474,260
    
    
    $
    451,284
    
    
    $
    348,301Other assets, net
    
    
    95,547
    
    
    
    241,448
    
    
    
    425,830
    
    
    
    54,953
    
    
    
    44,757Total assets
    
    $
    632,940
    
    
    $
    752,663
    
    
    $
    900,090
    
    
    $
    506,237
    
    
    $
    393,058Liabilities and equity:Mortgages, credit facility, and term debt
    
    $
    362,303
    
    
    $
    410,892
    
    
    $
    462,948
    
    
    $
    314,314
    
    
    $
    259,545Other liabilities, net
    
    
    53,117
    
    
    
    93,991
    
    
    
    154,148
    
    
    
    29,667
    
    
    
    19,837Equity
    
    
    217,520
    
    
    
    247,780
    
    
    
    282,994
    
    
    
    162,256
    
    
    
    113,676Total liabilities and equity
    
    $
    632,940
    
    
    $
    752,663
    
    
    $
    900,090
    
    
    $
    506,237
    
    
    $
    393,058Cash Flow Data:Net cash provided by operating activities
    
    $
    7,496
    
    
    $
    45,443
    
    
    $
    24,740
    
    
    $
    23,796
    
    
    $
    15,900Net cash used in investing activities
    
    $
    (44,214
    )
    
    $
    (54,213
    )
    
    $
    (194,277
    )
    
    $
    (117,298
    )
    
    $
    (103,587
    )Net cash provided by financing activities
    
    $
    23,007
    
    
    $
    16
    
    
    $
    200,650
    
    
    $
    96,055
    
    
    $
    78,932Other Data:Funds from operations (FFO) (1)
    
    $
    (91,939
    )
    
    $
    (73,897
    )
    
    $
    21,380
    
    
    $
    18,259
    
    
    $
    15,036Funds from operations modified (FFOM) (1)
    
    $
    (90,447
    )
    
    $
    (71,132
    )
    
    $
    29,363
    
    
    $
    18,362
    
    
    $
    15,089FFOM, net of non-recurring items and impairments
    
    $
    28,818
    
    
    $
    31,229
    
    
    $
    30,675
    
    
    $
    18,362
    
    
    $
    15,089
 (1)
    
    FFO is a supplemental non-GAAP financial measure used by the real estate industry to
measure the operating performance of real estate companies. FFOM adds back to traditionally
defined FFO non-cash amortization of non-real estate related intangible assets associated with
purchase accounting. We present FFO and FFOM because we consider them important supplemental
measures of operational performance. We believe FFO is frequently used by securities
analysts, investors and other interested parties in the evaluation of REITs, many of which
present FFO when reporting their results. We believe that FFOM allows securities analysts,
investors and other interested parties to evaluate current period results to results prior to
the acquisition of MEA Holdings, Inc. FFO and FFOM are intended to exclude GAAP historical
cost depreciation and amortization of real estate and related assets, which assumes that the
value of real estate assets diminishes ratably over time. Historically, however, real estate
values have risen or fallen with market conditions. Because FFO and FFOM excludes
depreciation and amortization unique to real estate, gains and losses from property
dispositions and extraordinary items, they provide performance measures that, when compared
year over year, reflect the impact to operations from trends in occupancy rates, rental rates,
operating costs, development activities and interest costs, providing a perspective not
immediately apparent from net income. We compute FFO in accordance with standards established
by the Board of Governors of NAREIT in its March 1995 White Paper (as amended in November 1999
and April 2002), which may differ from the methodology for calculating FFO and FFOM utilized
by other equity REITs and, accordingly, may not be comparable to such other REITs. We adjust
the NAREIT definition to add back noncontrolling interests in consolidated real estate
partnerships before real estate related depreciation and amortization and deduct dividends on
preferred stock. Further, FFO and FFOM do not represent amounts available for managements
discretionary use because of needed capital replacement or expansion, debt service
obligations, or other commitments and uncertainties. FFO and FFOM should not be considered as
an alternative to net income (loss) (computed in accordance with GAAP) as an indicator of our
performance, nor are they indicative of funds available to fund our cash needs, including our
ability to pay dividends or make distributions.  39




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##### Table of Contents



For the year ended December 31,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006Funds from operations:Net income (loss)
    
    $
    (118,616
    )
    
    $
    (101,962
    )
    
    $
    (7,857
    )
    
    $
    (8,994
    )
    
    $
    (14,034
    )Real estate related depreciation and amortization (1)
    
    
    29,177
    
    
    
    29,114
    
    
    
    30,583
    
    
    
    27,453
    
    
    
    30,188Noncontrolling interests in real estate partnerships, before real estate related depreciation and amortization
    
    
    (2,031
    )
    
    
    (1,049
    )
    
    
    (1,346
    )
    
    
    (200
    )
    
    
    (199
    )Gain on sale of real estate properties
    
    
    (264
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (919
    )Dividends on preferred stock
    
    
    (208
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Funds from operations
    
    
    (91,942
    )
    
    
    (73,897
    )
    
    
    21,380
    
    
    
    18,259
    
    
    
    15,036Amortization of intangibles related to purchase
accounting, net of income tax benefit
    
    
    1,495
    
    
    
    2,765
    
    
    
    7,983
    
    
    
    103
    
    
    
    53Funds from operations modified
    
    $
    (90,447
    )
    
    $
    (71,132
    )
    
    $
    29,363
    
    
    $
    18,362
    
    
    $
    15,089Non-recurring events and impairments:Intangible asset impairment charges, net of tax benefit
    
    $
    104,674
    
    
    $
    101,746
    
    
    $
    
    
    
    $
    
    
    
    $
    Tax valuation allowance
    
    
    10,553
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Mr. Spencers retirement compensation expense, net of tax benefit
    
    
    2,545
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Mr. Cogdells retirement compensation expense
    
    
    1,493
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Gain on settlement from MEA Holdings, Inc. transaction
    
    
    
    
    
    
    (4,905
    )
    
    
    
    
    
    
    
    
    
    
    Impairment of real estate property held for sale
    
    
    
    
    
    
    1,359
    
    
    
    
    
    
    
    
    
    
    
    Strategic planning professional fees
    
    
    
    
    
    
    2,641
    
    
    
    
    
    
    
    
    
    
    
    Debt extinguishment and interest rate derivative expense, net of tax benefit
    
    
    
    
    
    
    1,520
    
    
    
    
    
    
    
    
    
    
    
    Restructuring and severance charges, net of tax benefit
    
    
    
    
    
    
    
    
    
    
    1,312
    
    
    
    
    
    
    
    Impact of non-recurring events
    
    $
    119,265
    
    
    $
    102,361
    
    
    $
    1,312
    
    
    $
    
    
    
    $
    FFOM, excluding non-recurring events and impairments
    
    $
    28,818
    
    
    $
    31,229
    
    
    $
    30,675
    
    
    $
    18,362
    
    
    $
    15,089
 (1)
    
    Real estate depreciation and amortization consists of depreciation and amortization
from wholly-owned real estate properties and our share of real estate depreciation and
amortization from consolidated and unconsolidated real estate partnerships.  40




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##### Table of Contents



Item 7.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
 The following discussion should be read in conjunction with the Cogdell Spencer Inc.
Consolidated Financial Statements and Notes thereto appearing elsewhere in this Annual Report on
Form 10-K. We make statements in this section that are forward-looking statements within the
meaning of the federal securities laws. For a complete discussion of forward-looking statements,
see the section in this Annual Report on Form 10-K entitled Statements Regarding Forward-Looking
Information. Certain risk factors may cause actual results, performance or achievements to differ
materially from those expressed or implied by the following discussion. For a discussion of such
risk factors, see the section in this Annual Report on Form 10-K entitled Risk Factors.
 Overview
     
    
    65 consolidated wholly-owned and joint venture properties, comprising a total of
approximately 3.6 million net rentable square feet, 90.6% leased;
    
    one wholly-owned property in the lease-up phase, comprising approximately 0.1 million
net rentable square feet, 75% leased and income producing with the remaining 25% leased
and under construction for a third quarter 2011 scheduled date of occupancy;
    
    three unconsolidated joint venture properties comprising a total of approximately 0.2
million net rentable square feet; and
    
    44 properties managed for third party clients comprising a total of approximately 2.0
million net rentable square feet.
   41




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Critical Accounting Estimates
    42




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Acquisition of Real Estate
  Useful Lives of Assets
  Asset Impairment Valuation
    43




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Revenue Recognition
    44




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Income Taxes
      45




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REIT Qualification Requirements
  Changes in Financial Condition
    Results of Operations
  Business Segments
   46




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##### Table of Contents



Property Summary
  2010
    
    
    2009Properties at January 1
    
    
    62
    
    
    
    62Acquisitions
    
    
    1
    
    
    
    Developments
    
    
    3
    
    
    
    1Discontinued operations held for sale
    
    
    
    
    
    
    (1
    )Properties at December 31
    
    
    66
    
    
    
    62
   Year ended December 31, 2010 compared to the year ended December 31, 2009
 Funds from Operations Modified (FFOM)
   2010
    
    
    2009FFOM attributable to:Property operations, excluding impairment charges
    
    $
    56,054
    
    
    $
    50,729Design-Build and development, excluding impairment charges
    
    
    3,930
    
    
    
    19,297Intersegment eliminations
    
    
    (2,896
    )
    
    
    (7,751
    )Unallocated and other, excluding non-recurring events
    
    
    (28,270
    )
    
    
    (31,046
    )FFOM, excluding non-recurring events and impairment charges
    
    
    28,818
    
    
    
    31,229Non-recurring events and impairment charges:Goodwill and intangible asset impairment charges, net of tax benefit
    
    
    (104,674
    )
    
    
    (101,746
    )Deferred tax asset valuation allowance
    
    
    (10,553
    )
    
    
    Mr. Spencers retirement compensation expense, net of tax benefit
    
    
    (2,545
    )
    
    
    Mr. Cogdells retirement compensation expense
    
    
    (1,493
    )
    
    
    Gain on settlement from MEA Holdings, Inc. transaction
    
    
    
    
    
    
    4,905Strategic planning professional fees
    
    
    
    
    
    
    (2,641
    )Debt extinguishment and interest rate derivative expense, net of income tax benefit
    
    
    
    
    
    
    (1,520
    )Impairment of real estate property held for sale
    
    
    
    
    
    
    (1,359
    )FFOM
    
    $
    (90,447
    )
    
    $
    (71,132
    )
  47




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##### Table of Contents



2010
    
    
    2009Net loss
    
    $
    (118,616
    )
    
    $
    (101,962
    )Add:Real estate related depreciation and amortization:Wholly-owned and consolidated properties,
including amounts in discontinued
operations
    
    
    29,164
    
    
    
    29,102Unconsolidated real estate partnerships
    
    
    13
    
    
    
    12Less:Noncontrolling interests in real estate partnerships,
before real estate related depreciation and
amortization
    
    
    (2,031
    )
    
    
    (1,049
    )Gain on sale of real estate property
    
    
    (264
    )
    
    
    Dividends on preferred stock
    
    
    (208
    )
    
    
    Funds from Operations (FFO)
    
    
    (91,942
    )
    
    
    (73,897
    )Amortization of intangibles related to purchase
accounting, net of income tax benefit
    
    
    1,495
    
    
    
    2,765Funds from Operations Modified (FFOM)
    
    $
    (90,447
    )
    
    $
    (71,132
    )
 FFOM attributable to Property Operations, net of intersegment eliminations
  2010
    
    
    2009Rental revenue, net of intersegment eliminations of $92 in
2010 and 2009
    
    $
    87,803
    
    
    $
    79,486Property management and other fee revenue
    
    
    3,212
    
    
    
    3,336Property operating and management expenses
    
    
    (33,664
    )
    
    
    (31,810
    )Interest and other income
    
    
    607
    
    
    
    541Earnings (loss) from unconsolidated real estate partnerships,
before real estate related depreciation and amortization
    
    
    26
    
    
    
    27Noncontrolling interests in real estate partnerships, before
real estate related depreciation and amortization
    
    
    (2,031
    )
    
    
    (1,049
    )Income from discontinued operations, before real estate
related depreciation and amortization and gain on sale
    
    
    9
    
    
    
    (1,253
    )FFOM, net of intersegment eliminations
    
    
    55,962
    
    
    
    49,278Intersegment eliminations
    
    
    92
    
    
    
    92FFOM
    
    $
    56,054
    
    
    $
    49,370
    48




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FFOM attributable to Design-Build and Development, net of intersegment eliminations
  2010
    
    
    2009Design-Build contract revenue and other sales, net of intersegment eliminations
of $22,741 in 2010 and $32,708 in 2009
    
    $
    91,256
    
    
    $
    143,416Development management and other income, net of intersegment eliminations
of $5,715 in 2010 and $3,387 in 2009
    
    
    146
    
    
    
    3,363Design-Build contract and development management expenses, net of intersegment
eliminations of $25,560 in 2010 and $28,344 in 2009
    
    
    (72,001
    )
    
    
    (113,961
    )Selling, general, and administrative expenses, net of intersegment eliminations
of $92 in 2010 and 2009
    
    
    (17,281
    )
    
    
    (20,449
    )Interest and other income
    
    
    3
    
    
    
    48Depreciation and amortization
    
    
    (997
    )
    
    
    (779
    )FFOM, excluding impairment charge, net of intersegment eliminations
    
    
    1,126
    
    
    
    11,638Goodwill and intangible asset impairment charges
    
    
    (127,041
    )
    
    
    (120,920
    )FFOM, net of intersegment eliminations
    
    
    (125,915
    )
    
    
    (109,282
    )Intersegment eliminations
    
    
    2,804
    
    
    
    7,659FFOM
    
    $
    (123,111
    )
    
    $
    (101,623
    )
       49




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Selling, general, and administrative
    Depreciation and amortization
  Impairment charges
   Interest expense
   50




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##### Table of Contents



Income tax benefit (expense)
  Cash Flows
  2010
    
    
    2009Net loss plus non-cash adjustments
    
    $
    25,193
    
    
    $
    37,599Changes in operating assets and liabilities
    
    
    (17,697
    )
    
    
    7,844Net cash provided by operating activities
    
    $
    7,496
    
    
    $
    45,443
    2010
    
    
    2009Development, redevelopment, and acquisitions
    
    $
    38,841
    
    
    $
    49,007Second generation tenant improvements
    
    
    2,977
    
    
    
    3,932Recurring property capital expenditures
    
    
    1,096
    
    
    
    1,633Investment in real estate properties
    
    $
    42,914
    
    
    $
    54,572
    51




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Year ended December 31, 2009 compared to year ended December 31, 2008
 Funds from Operations Modified (FFOM)
  2009
    
    
    2008FFOM attributable to:Property operations, excluding impairment charges
    
    $
    50,729
    
    
    $
    49,212Design-Build and development, excluding non-recurring event and impairment charges
    
    
    19,297
    
    
    
    21,420Intersegment eliminations
    
    
    (7,751
    )
    
    
    (627
    )Unallocated and other, excluding non-recurring events
    
    
    (31,046
    )
    
    
    (39,370
    )FFOM, excluding non-recurring events and impairment charges
    
    
    31,229
    
    
    
    30,635Non-recurring events and impairment charges:Gain on settlement from MEA Holdings, Inc. transaction
    
    
    4,905
    
    
    
    Goodwill and intangible asset impairment charges, net of tax benefit
    
    
    (101,746
    )
    
    
    Strategic planning professional fees
    
    
    (2,641
    )
    
    
    Debt extinguishment and interest rate derivative expense, net of income tax benefit
    
    
    (1,520
    )
    
    
    Impairment of real estate property held for sale
    
    
    (1,359
    )
    
    
    Restructuring and severance charges, net of tax benefit
    
    
    
    
    
    
    (1,312
    )FFOM
    
    $
    (71,132
    )
    
    $
    29,323
  2009
    
    
    2008Net loss
    
    $
    (101,962
    )
    
    $
    (7,857
    )Add:Real estate related depreciation and amortization:Wholly-owned and consolidated properties,
including amounts in discontinued
operations
    
    
    29,102
    
    
    
    30,570Unconsolidated real estate partnerships
    
    
    12
    
    
    
    13Less:Noncontrolling interests in real estate partnerships,
before real estate related depreciation and
amortization
    
    
    (1,049
    )
    
    
    (1,346
    )Gain on sale of real estate property
    
    
    
    
    
    
    Funds from Operations (FFO)
    
    
    (73,897
    )
    
    
    21,380Amortization of intangibles related to purchase
accounting, net of income tax benefit
    
    
    2,765
    
    
    
    7,983Funds from Operations Modified (FFOM)
    
    $
    (71,132
    )
    
    $
    29,363
  52




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FFOM attributable to Property Operations, net of intersegment eliminations
  2009
    
    
    2008Rental revenue, net of intersegment eliminations of $92 in
2009 and $43 in 2008
    
    $
    79,486
    
    
    $
    77,421Property management and other fee revenue
    
    
    3,336
    
    
    
    3,460Property operating and management expenses
    
    
    (31,810
    )
    
    
    (31,065
    )Interest and other income
    
    
    541
    
    
    
    597Earnings from unconsolidated real estate partnerships,
before real estate related depreciation and amortization
    
    
    27
    
    
    
    35Noncontrolling interests in real estate partnerships, before
real estate related depreciation and amortization
    
    
    (1,049
    )
    
    
    (1,346
    )Income from discontinued operations, before real estate
related depreciation and amortization and gain on sale
    
    
    (1,253
    )
    
    
    67FFOM, net of intersegment eliminations
    
    
    49,278
    
    
    
    49,169Intersegment eliminations
    
    
    92
    
    
    
    43FFOM
    
    $
    49,370
    
    
    $
    49,212
   FFOM attributable to Design-Build and Development, net of intersegment eliminations
  2009
    
    
    2008Design-Build contract revenue and other sales, net of intersegment eliminations
of $32,708 in 2009 and $4,536 in 2008
    
    $
    143,416
    
    
    $
    253,596Development management and other income, net of intersegment eliminations
of $3,387 in 2009 and $803 in 2008
    
    
    3,363
    
    
    
    885Design-Build contract and development management expenses, net of intersegment
eliminations of $28,344 in 2009 and $4,712 in 2008
    
    
    (113,961
    )
    
    
    (214,019
    )Selling, general, and administrative expenses, net of intersegment eliminations
of $92 in 2009 and $43 in 2008
    
    
    (20,449
    )
    
    
    (20,184
    )Interest and other income
    
    
    48
    
    
    
    149Depreciation and amortization
    
    
    (779
    )
    
    
    (1,129
    )FFOM, excluding impairment charge, net of intersegment eliminations
    
    
    11,638
    
    
    
    19,298Goodwill and intangible asset impairment charges
    
    
    (120,920
    )
    
    
    FFOM, net of intersegment eliminations
    
    
    (109,282
    )
    
    
    19,298Intersegment eliminations
    
    
    7,659
    
    
    
    627FFOM
    
    $
    (101,623
    )
    
    $
    19,925
    53




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Selling, general, and administrative
  Depreciation and amortization
   54




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Impairment charge
    Gain on settlement from MEA transaction
   Interest expense
  Income tax benefit
  Impairment of real estate property
   Net loss attributable to the noncontrolling interest in Operating Partnership
   55




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##### Table of Contents



Cash Flows
  2009
    
    
    2008Net loss plus non-cash adjustments
    
    $
    37,599
    
    
    $
    32,972Changes in operating assets and liabilities
    
    
    7,844
    
    
    
    (8,232
    )Net cash provided by operating activities
    
    $
    45,443
    
    
    $
    24,740
   2009
    
    
    2008Development, redevelopment, and acquisitions
    
    $
    49,007
    
    
    $
    39,163Second generation tenant improvements
    
    
    3,932
    
    
    
    3,722Recurring property capital expenditures
    
    
    1,633
    
    
    
    2,630Investment in real estate properties
    
    $
    54,572
    
    
    $
    45,515
  Construction in Progress
  Estimated
    
    
    Net Rentable
    
    
    
    
    
    
    EstimatedCompletion
    
    
    Square Feet
    
    
    Investment
    
    
    TotalProperty
    
    Location
    
    Date
    
    
    (unaudited)
    
    
    to Date
    
    
    InvestmentGood Sam MOB Investors, LLC
    
    Puyallup, WA
    
    
    4Q 2011
    
    
    
    80,000
    
    
    $
    8,906
    
    
    $
    24,700Bonney Lake MOB Investors, LLC (1)
    
    Bonney Lake, WA
    
    
    3Q 2011
    
    
    
    56,000
    
    
    
    10,220
    
    
    
    17,700Land and pre-construction developments
    
    
    
    
    
    
    
    
    
    
    
    
    3,117
    
    
    
    136,000
    
    
    $
    22,243
    
    
    $
    42,400
 (1)
    
    We have a 61.7% ownership interest at December 31, 2010. Liquidity and Capital Resources
    56




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Financial Covenant
    
    December 31, 2010Maximum total leverage ratio (0.70 to 1.00)
    
    
    0.44 to 1.00Maximum real estate leverage ratio (0.70 to 1.00)
    
    
    0.45 to 1.00Minimum fixed charge coverage ratio (1.50 to 1.00)
    
    
    1.94 to 1.00Minimum consolidated tangible net worth ($235,636)
    
    $
    329,051Maximum total debt to real estate value ratio (0.90 to 1.00)
    
    
    0.45 to 1.00
     57




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Short-Term Liquidity Needs
      Long-Term Liquidity Needs
    58




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##### Table of Contents



Contractual Obligations
  2011
    
    
    2012
    
    
    2013
    
    
    2014
    
    
    2015
    
    
    Thereafter
    
    
    TotalObligation:Long-term debt principal
payments and maturities (1)
    
    $
    77,443
    
    
    $
    28,046
    
    
    $
    15,976
    
    
    $
    109,212
    
    
    $
    11,422
    
    
    $
    120,140
    
    
    $
    362,239Standby letters of credit (2)
    
    
    8,128
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,128Interest payments (3)
    
    
    13,744
    
    
    
    11,356
    
    
    
    10,315
    
    
    
    8,641
    
    
    
    6,252
    
    
    
    12,437
    
    
    
    62,745Purchase commitments (4)
    
    
    608
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    608Ground and air rights leases
(5)
    
    
    881
    
    
    
    978
    
    
    
    978
    
    
    
    978
    
    
    
    978
    
    
    
    19,324
    
    
    
    24,117Operating leases (6)
    
    
    4,955
    
    
    
    4,298
    
    
    
    3,521
    
    
    
    3,443
    
    
    
    3,364
    
    
    
    20,987
    
    
    
    40,568Total
    
    $
    105,759
    
    
    $
    44,678
    
    
    $
    30,790
    
    
    $
    122,274
    
    
    $
    22,016
    
    
    $
    172,888
    
    
    $
    498,405
 (1)
    
    Includes notes payable under the Companys Credit Facility(2)
    
    As collateral for performance, the Company is contingently liable under standby
letters of credit, which also reduces the availability under the
Credit Facility(3)
    
    Assumes one-month LIBOR of 0.26% and Prime Rate of 3.25% which were the rates as of
December 31, 2010 and includes fixed rate
interest swap agreements.(4)
    
    These purchase commitments are related to the Companys development projects that
are currently under construction.(5)
    
    Substantially all of the ground and air rights leases effectively limit our control
over various aspects of the operation of the applicable
property, restrict our ability to transfer the property and allow the lessor the right of first
refusal to purchase the building and improvements. All
of the ground and air rights leases provide for the property to revert to the lessor for no
consideration upon the expiration or earlier termination
of the ground or air rights lease.(6)
    
    Payments under operating lease agreements relate to various of our properties
equipment and office space leases. The future minimum lease
commitments under these leases are as indicated. Form 10-K.
 Warranties
   59




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##### Table of Contents



For the Year Ended
    
    
    For the Year Ended
    
    
    For the Year EndedDecember 31,
    
    
    December 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2008Balance at the beginning of
period
    
    $
    1,500
    
    
    $
    4,331
    
    
    $
    Design-Build acquisition
    
    
    
    
    
    
    
    
    
    
    4,600Accruals
    
    
    1,187
    
    
    
    (218
    )
    
    
    2,217Settlements
    
    
    (1,707
    )
    
    
    (2,613
    )
    
    
    (2,486
    )Balance at the end of period
    
    $
    980
    
    
    $
    1,500
    
    
    $
    4,331
 Off-Balance Sheet Arrangements
  Real Estate Taxes
  Inflation
  Seasonality
  Recent Accounting Pronouncements
   60




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##### Table of Contents



Item 7A.
    
    Quantitative and Qualitative Disclosure About Market Risk
     61




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##### Table of Contents



COGDELL SPENCER INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
 
 Item 8.
    
    Financial Statements and Supplementary Data
 COGDELL SPENCER INC.
 INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS
 PageReport of Independent Registered Public Accounting Firm
    
    63Consolidated Balance Sheets as of December 31, 2010 and 2009
    
    64Consolidated Statements of Operations for the years ended December 31, 2010, 2009, and 2008
    
    65Consolidated Statements of Equity for the years ended December 31, 2010, 2009, and 2008
    
    66Consolidated Statements of Cash Flows for the years ended December 31, 2010, 2009, and 2008
    
    67Notes to Consolidated Financial Statements
    
    69Supplemental Schedule  Schedule III  Real Estate and Accumulated Depreciation
    
    104Notes to Schedule III  Real Estate and Accumulated Depreciation
    
    106
  62




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##### Table of Contents



COGDELL SPENCER INC.

CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
 
  
     /s/ DELOITE & TOUCHE LLP
 
  63




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##### Table of Contents



COGDELL SPENCER INC.
 
 CONSOLIDATED BALANCE SHEETS
 (in thousands, except per share amounts)
 December 31,
    
    
    December 31,2010
    
    
    2009AssetsReal estate properties:Land
    
    $
    37,269
    
    
    $
    33,139Buildings and improvements
    
    
    597,022
    
    
    
    527,985Less: Accumulated depreciation
    
    
    (119,141
    )
    
    
    (93,247
    )Net operating real estate properties
    
    
    515,150
    
    
    
    467,877Construction in progress
    
    
    22,243
    
    
    
    43,338Net real estate properties
    
    
    537,393
    
    
    
    511,215Cash and cash equivalents
    
    
    12,203
    
    
    
    25,914Restricted cash
    
    
    6,794
    
    
    
    3,060Tenant and accounts receivable, net of allowance of $3,010 in 2010 and $2,817 in 2009
    
    
    11,383
    
    
    
    12,993Goodwill
    
    
    22,882
    
    
    
    108,683Trade names and trademarks
    
    
    
    
    
    
    41,240Intangible assets, net of accumulated amortization of $49,287 in 2010 and $43,313 in 2009
    
    
    18,601
    
    
    
    21,742Other assets
    
    
    23,684
    
    
    
    25,599Other assets  held for sale
    
    
    
    
    
    
    2,217Total assets
    
    $
    632,940
    
    
    $
    752,663Liabilities and equityMortgage notes payable
    
    $
    317,303
    
    
    $
    280,892Revolving credit facility
    
    
    45,000
    
    
    
    80,000Term loan
    
    
    
    
    
    
    50,000Accounts payable
    
    
    11,368
    
    
    
    15,293Billings in excess of costs and estimated earnings on uncompleted contracts
    
    
    1,930
    
    
    
    13,189Deferred income taxes
    
    
    
    
    
    
    15,993Other liabilities
    
    
    39,819
    
    
    
    47,312Other liabilities  held for sale
    
    
    
    
    
    
    2,204Total liabilities
    
    
    415,420
    
    
    
    504,883Commitments and contingenciesEquity:Cogdell Spencer Inc. stockholders equity:Preferred stock, $0.01 par value; 50,000 shares authorized:8.5000% Series A Cumulative Redeemable Perpetual Preferred Shares (liquidation
preference $25.00 per share), 2,600 and zero shares issued and outstanding in 2010
and 2009, respectively
    
    
    65,000
    
    
    
    Common stock, $0.01 par value; 200,000 shares authorized, 50,870 and 42,729 shares
issued and outstanding in 2010 and 2009, respectively
    
    
    509
    
    
    
    427Additional paid-in capital
    
    
    417,960
    
    
    
    370,593Accumulated other comprehensive loss
    
    
    (3,339
    )
    
    
    (1,861
    )Accumulated deficit
    
    
    (287,798
    )
    
    
    (164,321
    )Total Cogdell Spencer Inc. stockholders equity
    
    
    192,332
    
    
    
    204,838Noncontrolling interests:Real estate partnerships
    
    
    6,452
    
    
    
    5,220Operating partnership
    
    
    18,736
    
    
    
    37,722Total noncontrolling interests
    
    
    25,188
    
    
    
    42,942Total equity
    
    
    217,520
    
    
    
    247,780Total liabilities and equity
    
    $
    632,940
    
    
    $
    752,663
   64




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##### Table of Contents



COGDELL SPENCER INC.
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (in thousands, except per share amounts)
 For the Year Ended
    
    
    For the Year Ended
    
    
    For the Year EndedDecember 31, 2010
    
    
    December 31, 2009
    
    
    December 31, 2008Revenues:Rental revenue
    
    $
    87,803
    
    
    $
    79,486
    
    
    $
    77,421Design-Build contract revenue and other sales
    
    
    91,256
    
    
    
    143,416
    
    
    
    253,596Property management and other fees
    
    
    3,212
    
    
    
    3,336
    
    
    
    3,460Development management and other income
    
    
    146
    
    
    
    3,363
    
    
    
    885Total revenues
    
    
    182,417
    
    
    
    229,601
    
    
    
    335,362Expenses:Property operating and management
    
    
    33,664
    
    
    
    31,810
    
    
    
    31,065Design-Build contracts and development management
    
    
    72,001
    
    
    
    113,961
    
    
    
    214,019Selling, general, and administrative
    
    
    30,411
    
    
    
    32,285
    
    
    
    30,215Depreciation and amortization
    
    
    32,841
    
    
    
    34,502
    
    
    
    44,879Impairment charges
    
    
    127,041
    
    
    
    120,920
    
    
    
    Total expenses
    
    
    295,958
    
    
    
    333,478
    
    
    
    320,178Income (loss) from continuing operations before other income (expense) and
income tax benefit
    
    
    (113,541
    )
    
    
    (103,877
    )
    
    
    15,184Other income (expense):Interest and other income
    
    
    655
    
    
    
    620
    
    
    
    922Gain on settlement from MEA Holdings, Inc. transaction
    
    
    
    
    
    
    4,905
    
    
    
    Interest expense
    
    
    (21,994
    )
    
    
    (21,711
    )
    
    
    (25,017
    )Debt extinguishment and interest rate derivative expense
    
    
    (371
    )
    
    
    (2,511
    )
    
    
    Equity in earnings of unconsolidated real estate partnerships
    
    
    13
    
    
    
    15
    
    
    
    22Total other income (expense)
    
    
    (21,697
    )
    
    
    (18,682
    )
    
    
    (24,073
    )Loss from continuing operations before income tax benefit
    
    
    (135,238
    )
    
    
    (122,559
    )
    
    
    (8,889
    )Income tax benefit
    
    
    16,352
    
    
    
    22,124
    
    
    
    1,244Loss from continuing operations
    
    
    (118,886
    )
    
    
    (100,435
    )
    
    
    (7,645
    )Discontinued operations:Income (loss) from discontinued operations
    
    
    6
    
    
    
    (168
    )
    
    
    (212
    )Impairment of real estate property
    
    
    
    
    
    
    (1,359
    )
    
    
    Gain on sale of discontinued operations
    
    
    264
    
    
    
    
    
    
    
    Total discontinued operations
    
    
    270
    
    
    
    (1,527
    )
    
    
    (212
    )Net loss
    
    
    (118,616
    )
    
    
    (101,962
    )
    
    
    (7,857
    )Net income attributable to the noncontrolling interests in real estate
partnerships
    
    
    (831
    )
    
    
    (288
    )
    
    
    (964
    )Net loss attributable to the noncontrolling interests in operating partnership
    
    
    15,566
    
    
    
    32,522
    
    
    
    3,048Dividends on preferred stock
    
    
    (208
    )
    
    
    
    
    
    
    Net loss attributable to Cogdell Spencer Inc. common shareholders
    
    $
    (104,089
    )
    
    $
    (69,728
    )
    
    $
    (5,773
    )Per share data  basic and dilutedLoss from continuing operations attributable to Cogdell Spencer Inc. common
shareholders
    
    $
    (2.20
    )
    
    $
    (2.10
    )
    
    $
    (0.36
    )Income (loss) from discontinued operations attributable to Cogdell
Spencer Inc. common shareholders
    
    
    
    
    
    
    (0.04
    )
    
    
    (0.01
    )Net loss per common share available to Cogdell Spencer Inc. common
shareholders
    
    $
    (2.20
    )
    
    $
    (2.14
    )
    
    $
    (0.37
    )Weighted average common shares  basic and diluted
    
    
    47,456
    
    
    
    32,655
    
    
    
    15,770Net loss attributable to Cogdell Spencer Inc. common shareholders:Continuing operations, net of tax
    
    $
    (104,321
    )
    
    $
    (68,500
    )
    
    $
    (5,634
    )Discontinued operations
    
    
    232
    
    
    
    (1,228
    )
    
    
    (139
    )Net loss attributable to Cogdell Spencer Inc. common shareholders
    
    $
    (104,089
    )
    
    $
    (69,728
    )
    
    $
    (5,773
    )
   65




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##### Table of Contents



COGDELL SPENCER INC.
 
 CONSOLIDATED STATEMENTS OF EQUITY
 (in thousands)
 Cogdell Spencer Inc. StockholdersSeries AAccumulated
    
    
    Cumulative
    
    
    
    
    
    
    
    
    
    
    Noncontrolling
    
    
    NoncontrollingOther
    
    
    Redeemable
    
    
    
    
    
    
    Additional
    
    
    Interests in
    
    
    Interests inTotal
    
    
    Comprehensive
    
    
    Accumulated
    
    
    Comprehensive
    
    
    Perpetual
    
    
    Common
    
    
    Paid-in
    
    
    Operating
    
    
    Real EstateEquity
    
    
    Loss
    
    
    Deficit
    
    
    Income (Loss)
    
    
    Preferred Shares
    
    
    Stock
    
    
    Capital
    
    
    Partnership
    
    
    PartnershipsBalance at December 31, 2007
    
    $
    162,256
    
    
    
    
    
    
    $
    (50,751
    )
    
    $
    (884
    )
    
    $
    
    
    
    $
    119
    
    
    $
    166,901
    
    
    $
    44,437
    
    
    $
    2,434Comprehensive loss:Net income (loss)
    
    
    (7,857
    )
    
    $
    (7,857
    )
    
    
    (5,773
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,048
    )
    
    
    964Unrealized loss on interest rate swaps,
net of tax
    
    
    (7,936
    )
    
    
    (7,936
    )
    
    
    
    
    
    
    (4,222
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,092
    )
    
    
    (1,622
    )Comprehensive loss
    
    
    (15,793
    )
    
    
    (15,793
    )Issuance of common stock, net of costs
    
    
    91,231
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    57
    
    
    
    91,174
    
    
    
    
    
    
    
    Issuance of operating partnership units
    
    
    74,270
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    74,270
    
    
    
    Redemption of operating partnership units
    
    
    (493
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (493
    )
    
    
    Conversion of operating partnership
units to common stock
    
    
    (114
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    1,843
    
    
    
    (1,958
    )
    
    
    Issuance of limited partnership interests in
real estate partnership
    
    
    3,845
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,845Restricted stock and LTIP units grants
    
    
    1,144
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    94
    
    
    
    1,050
    
    
    
    Amortization of restricted stock grants
    
    
    101
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    63
    
    
    
    38
    
    
    
    Dividends on common stock
    
    
    (20,914
    )
    
    
    
    
    
    
    (20,914
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Distributions to noncontrolling interests
    
    
    (12,539
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,575
    )
    
    
    (964
    )Adjustment to record change of interest
in the operating partnership due to the
issuance of operating partnership units
at other than book value
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,305
    
    
    
    (15,305
    )
    
    
    Balance at December 31, 2008
    
    
    282,994
    
    
    
    
    
    
    
    (77,438
    )
    
    
    (5,106
    )
    
    
    
    
    
    
    177
    
    
    
    275,380
    
    
    
    85,324
    
    
    
    4,657Comprehensive loss:Net income (loss)
    
    
    (101,962
    )
    
    
    (101,962
    )
    
    
    (69,728
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (32,522
    )
    
    
    288Unrealized gain on interest rate swaps,
net of tax
    
    
    5,185
    
    
    
    5,185
    
    
    
    
    
    
    
    3,760
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    611
    
    
    
    814Comprehensive loss
    
    
    (96,777
    )
    
    
    (96,777
    )Issuance of common stock, net of costs
    
    
    76,457
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    230
    
    
    
    76,227
    
    
    
    
    
    
    
    Issuance of operating partnership units
    
    
    5,262
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,262
    
    
    
    Conversion of operating partnership units
to
common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (515
    )
    
    
    
    
    
    
    20
    
    
    
    18,830
    
    
    
    (18,335
    )
    
    
    Restricted stock and LTIP unit grants
    
    
    1,344
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    80
    
    
    
    1,264
    
    
    
    Amortization of restricted stock grants
    
    
    113
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    76
    
    
    
    37Dividends on common stock
    
    
    (17,155
    )
    
    
    
    
    
    
    (17,155
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Distributions to noncontrolling interests
    
    
    (4,458
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,919
    )
    
    
    (539
    )Balance at December 31, 2009
    
    
    247,780
    
    
    
    
    
    
    
    (164,321
    )
    
    
    (1,861
    )
    
    
    
    
    
    
    427
    
    
    
    370,593
    
    
    
    37,722
    
    
    
    5,220Comprehensive loss:Net income (loss)
    
    
    (118,616
    )
    
    
    (118,616
    )
    
    
    (103,881
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (15,566
    )
    
    
    831Unrealized loss on interest rate swaps,
net of tax
    
    
    (2,328
    )
    
    
    (2,328
    )
    
    
    
    
    
    
    (1,387
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (251
    )
    
    
    (690
    )Comprehensive loss
    
    
    (120,944
    )
    
    
    (120,944
    )Issuance of common stock, net of costs
    
    
    47,616
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    72
    
    
    
    47,544
    
    
    
    
    
    
    
    Issuance of preferred stock, net of costs
    
    
    62,564
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    65,000
    
    
    
    
    
    
    
    (2,436
    )
    
    
    
    
    
    
    Redemption of operating partnership units
    
    
    (133
    )
    
    
    
    
    
    
    
    
    
    
    (4
    )
    
    
    
    
    
    
    
    
    
    
    (39
    )
    
    
    (90
    )
    
    
    Conversion of operating partnership units
to
common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (87
    )
    
    
    
    
    
    
    4
    
    
    
    1,959
    
    
    
    (1,876
    )
    
    
    Restricted stock and LTIP unit grants
    
    
    2,038
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6
    
    
    
    194
    
    
    
    1,838
    
    
    
    Amortization of restricted stock grants
    
    
    145
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    145
    
    
    
    Dividends on common stock
    
    
    (19,388
    )
    
    
    
    
    
    
    (19,388
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Dividends on preferred stock
    
    
    (208
    )
    
    
    
    
    
    
    (208
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Distributions to noncontrolling interests
    
    
    (4,326
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,041
    )
    
    
    (1,285
    )Contributed equity in real estate
partnership
    
    
    2,376
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,376Balance at December 31, 2010
    
    $
    217,520
    
    
    
    
    
    
    $
    (287,798
    )
    
    $
    (3,339
    )
    
    $
    65,000
    
    
    $
    509
    
    
    $
    417,960
    
    
    $
    18,736
    
    
    $
    6,452
   66




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##### Table of Contents



COGDELL SPENCER INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (in thousands)
 For the Year Ended
    
    
    For the Year Ended
    
    
    For the Year EndedDecember 31, 2010
    
    
    December 31, 2009
    
    
    December 31, 2008Operating activities:Net loss
    
    $
    (118,616
    )
    
    $
    (101,962
    )
    
    $
    (7,857
    )Adjustments to reconcile net loss to cash provided by operating activities:Depreciation and amortization (including amounts in
discontinued operations)
    
    
    32,841
    
    
    
    34,502
    
    
    
    45,016Amortization of acquired above market leases and acquired
below market leases, net (including amounts in discontinued
operations)
    
    
    (429
    )
    
    
    (542
    )
    
    
    (638
    )Straight-line rental revenue
    
    
    (1,206
    )
    
    
    (556
    )
    
    
    (569
    )Amortization of deferred finance costs and debt premium
    
    
    1,282
    
    
    
    1,644
    
    
    
    1,286Provision for bad debts
    
    
    192
    
    
    
    2,624
    
    
    
    175Deferred income taxes
    
    
    (16,419
    )
    
    
    (18,614
    )
    
    
    (5,657
    )Deferred tax expense on intersegment profits
    
    
    67
    
    
    
    (2,813
    )
    
    
    (7
    )Equity-based compensation
    
    
    1,878
    
    
    
    1,300
    
    
    
    1,245Equity in earnings of unconsolidated real estate partnerships
    
    
    (13
    )
    
    
    (15
    )
    
    
    (22
    )Debt extinguishment and interest rate derivative expense
    
    
    (264
    )
    
    
    2,511
    
    
    
    Change in fair value of interest rate swap agreements
    
    
    (897
    )
    
    
    (757
    )
    
    
    Impairment of goodwill, trade names and trademarks and
intangible assets
    
    
    127,041
    
    
    
    120,920
    
    
    
    Impairment of real estate property
    
    
    
    
    
    
    1,359
    
    
    
    Gain on sale of real estate property
    
    
    (264
    )
    
    
    
    
    
    
    Gain on settlement from MEA Holdings, Inc. transaction
    
    
    
    
    
    
    (2,002
    )
    
    
    Changes in operating assets and liabilities:Tenant and accounts receivable and other assets
    
    
    2,203
    
    
    
    32,118
    
    
    
    16,243Accounts payable and other liabilities
    
    
    (8,641
    )
    
    
    (20,438
    )
    
    
    (4,366
    )Billings in excess of costs and estimated earnings
on uncompleted contracts
    
    
    (11,259
    )
    
    
    (3,836
    )
    
    
    (20,109
    )Net cash provided by operating activities
    
    
    7,496
    
    
    
    45,443
    
    
    
    24,740Investing activities:Business acquisitions, net of cash acquired
    
    
    
    
    
    
    (8,022
    )
    
    
    (134,134
    )Investment in real estate properties, net of cash acquired
    
    
    (42,914
    )
    
    
    (54,572
    )
    
    
    (45,515
    )Purchase of noncontrolling interests in operating partnership
    
    
    
    
    
    
    
    
    
    
    (770
    )Proceeds from sales-type capital lease
    
    
    306
    
    
    
    306
    
    
    
    306Proceeds from the disposal of disontinued operations
    
    
    2,481
    
    
    
    
    
    
    
    Purchase of corporate property, plant and equipment
    
    
    (360
    )
    
    
    (1,830
    )
    
    
    (3,008
    )Distributions received from unconsolidated real estate partnerships
    
    
    7
    
    
    
    6
    
    
    
    5Decrease (increase) in restricted cash
    
    
    (3,734
    )
    
    
    9,899
    
    
    
    (11,161
    )Net cash used in investing activities
    
    
    (44,214
    )
    
    
    (54,213
    )
    
    
    (194,277
    )Financing activities:Proceeds from mortgage notes payable
    
    
    48,766
    
    
    
    73,222
    
    
    
    22,580Repayments of mortgage notes payable
    
    
    (30,130
    )
    
    
    (30,813
    )
    
    
    (21,964
    )Proceeds from revolving credit facility
    
    
    14,000
    
    
    
    3,500
    
    
    
    145,000Repayments to revolving credit facility
    
    
    (49,000
    )
    
    
    (48,000
    )
    
    
    (99,700
    )Proceeds from term loan
    
    
    
    
    
    
    
    
    
    
    100,000Repayment of term loan
    
    
    (50,000
    )
    
    
    (50,000
    )
    
    
    Net proceeds from sale of common stock
    
    
    47,616
    
    
    
    76,457
    
    
    
    91,229Net proceeds from sale of preferred stock
    
    
    62,564
    
    
    
    
    
    
    
    Purchase of noncontrolling interests in operating partnership
    
    
    (133
    )
    
    
    
    
    
    
    Dividends on common stock
    
    
    (18,600
    )
    
    
    (16,874
    )
    
    
    (21,111
    )Distributions to noncontrolling interest in the Operating
Partnership
    
    
    (2,265
    )
    
    
    (5,261
    )
    
    
    (10,990
    )Distributions to noncontrolling interest in real estate partnerships
    
    
    (1,285
    )
    
    
    (539
    )
    
    
    (963
    )Contributions from noncontrolling interests in real estate
partnerships
    
    
    2,376
    
    
    
    
    
    
    
    481Payment of financing costs
    
    
    (902
    )
    
    
    (1,676
    )
    
    
    (3,912
    )Net cash provided by financing activities
    
    
    23,007
    
    
    
    16
    
    
    
    200,650Increase (decrease) in cash and cash equivalents
    
    
    (13,711
    )
    
    
    (8,754
    )
    
    
    31,113Balance at beginning of period
    
    
    25,914
    
    
    
    34,668
    
    
    
    3,555Balance at end of period
    
    $
    12,203
    
    
    $
    25,914
    
    
    $
    34,668Supplemental disclosure of cash flow information:Cash paid for interest, net of capitalized interest
    
    $
    22,247
    
    
    $
    21,998
    
    
    $
    25,477Cash paid for income taxes
    
    $
    37
    
    
    $
    37
    
    
    $
    3,897
  67




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COGDELL SPENCER INC.
 CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(in thousands)
 For the Year Ended
    
    
    For the Year Ended
    
    
    For the Year EndedDecember 31, 2010
    
    
    December 31, 2009
    
    
    December 31, 2008Non-cash investing and financing activities:Debt assumed with purchase of properties
    
    $
    15,580
    
    
    $
    
    
    
    $
    2,733Accrued dividends and distributions
    
    
    6,047
    
    
    
    5,051
    
    
    
    6,061Operating Partnership Units converted into common stock
    
    
    1,963
    
    
    
    18,850
    
    
    
    1,844Investment in real estate properties included in
accounts payable and other liabilities
    
    
    (319
    )
    
    
    (4,490
    )
    
    
    (1,788
    )Operating Partnership Units issued or to be issued in
connection with the acquisition of a business or real
estate property
    
    
    
    
    
    
    
    
    
    
    81,347Noncontrolling interest assumed with purchase of property
    
    
    
    
    
    
    
    
    
    
    3,359
   68




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##### Table of Contents



COGDELL SPENCER INC.
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 1. Business
   2. Summary of Significant Accounting Policies
 Basis of Presentation
  Use of Estimates in Financial Statements
  Revenue Recognition
  Rental Revenue and Property Management.
  69




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  Design-Build Contract Revenues and Development Management.
   Other income.
 Warranties
   For the Year Ended
    
    
    For the Year Ended
    
    
    For the Year EndedDecember 31,
    
    
    December 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2008Balance at the beginning of period
    
    $
    1,500
    
    
    $
    4,331
    
    
    $
    Design-Build acquisition
    
    
    
    
    
    
    
    
    
    
    4,600Accruals
    
    
    1,187
    
    
    
    (218
    )
    
    
    2,217Settlements
    
    
    (1,707
    )
    
    
    (2,613
    )
    
    
    (2,486
    )Balance at the end of period
    
    $
    980
    
    
    $
    1,500
    
    
    $
    4,331
  70




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Income Taxes
     Comprehensive Income or Loss
  Cash and Cash Equivalents
  December 31,
    
    
    December 31,2010
    
    
    2009Corporate cash and cash
equivalents (available
for general corporate
purposes)
    
    $
    10,561
    
    
    $
    23,950Consolidated real estate
partnerships cash and
cash equivalents
(available only for real
estate partnership
purposes, including
distributions)
    
    
    1,642
    
    
    
    1,964$
    12,203
    
    
    $
    25,914
 Restricted Cash
   71




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Real Estate Properties and Related Intangible Assets
        Repairs, Maintenance and Major Improvements
   72




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Capitalization of Interest
  Tenant and Accounts Receivable
    Investment in Capital Lease
  Deferred Financing Costs
  Unconsolidated Real Estate Partnerships
  Goodwill and Intangible Assets
   73




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Fair Value of Financial Instruments
      Offering Costs
  Share Based Compensation
   74




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Per Share Data
  Concentrations and Credit Risk
   December 31,
    
    December 31,2010
    
    2009Customer balances
greater than 10% of
tenants and accounts
receivable
    
    One
    
    ThreeCustomer revenues
greater than 10% of
total revenue
    
    One
    
    One
 Reclassifications
  Subsequent Events
  3. Minimum Future Rental Revenues
   For the year ending:2011
    
    $
    78,2742012
    
    
    67,3002013
    
    
    55,1782014
    
    
    46,9462015
    
    
    38,505Thereafter
    
    
    195,729$
    481,932
  75




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  December 31,
    
    
    December 31,2010
    
    
    2009Total minimum lease payments
    
    $
    11,089
    
    
    $
    11,873Less: Unearned income
    
    
    (6,119
    )
    
    
    (6,596
    )Investment in capital lease
    
    $
    4,970
    
    
    $
    5,277
  For the year ending:2011
    
    $
    7902012
    
    
    7962013
    
    
    6242014
    
    
    6302015
    
    
    636Thereafter
    
    
    7,613$
    11,089
 4. Investments in Real Estate Partnerships
  Real Estate Entity
    
    Entity Holdings
    
    Year Founded
    
    Our OwnershipConsolidatedBonney Lake MOB Investors, LLC
    
    one property (under  construction)
    
    2009
    
    
    61.7
    %Genesis Property
Holdings, LLC
    
    one property
    
    2007
    
    
    40.0
    %Cogdell Health Campus
MOB, LP
    
    one property
    
    2006
    
    
    80.9
    %Mebane Medical
Investors, LLC
    
    one property
    
    2006
    
    
    35.1
    %Rocky Mount MOB, LLC
    
    one property
    
    2002
    
    
    34.5
    %UnconsolidatedCogdell Spencer
Medical Partners LLC
    
    no assets or liabilities
    
    2008
    
    
    20.0
    %BSB Health/MOB Limited
Partnership No. 2
    
    nine properties
    
    2002
    
    
    2.0
    %Shannon Health/MOB
Limited Partnership
No. 1
    
    ten properties
    
    2001
    
    
    2.0
    %McLeod Medical
Partners, LLC,
    
    three properties
    
    1982
    
    
    1.1
    %
     76




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  December 31,
    
    
    December 31,2010
    
    
    2009Financial position:Total assets
    
    $
    53,755
    
    
    $
    54,725Total liabilities
    
    
    47,272
    
    
    
    48,672Members equity
    
    
    6,483
    
    
    
    6,053
 For the Year Ended
    
    
    For the Year Ended
    
    
    For the Year EndedDecember 31, 2010
    
    
    December 31, 2009
    
    
    December 31, 2008Results of operations:Total revenues
    
    $
    11,905
    
    
    $
    12,528
    
    
    $
    12,362Operating and general and
administrative expenses
    
    
    5,612
    
    
    
    5,977
    
    
    
    5,787Net income
    
    
    996
    
    
    
    800
    
    
    
    760
 5. Acquisitions and Dispositions
 Property Acquisitions
  Building and improvements
    
    $
    13,796Land improvements
    
    
    10Acquired in place lease value and deferred leasing costs
    
    
    2,618Acquired below market ground lease
    
    
    214Total purchase price allocated, net of cash acquired
    
    $
    16,638
  December 31,
    
    
    December 31,2010
    
    
    2009Revenue
    
    $
    184
    
    
    $
    232Net loss
    
    
    (118
    )
    
    
    (102
    )Net loss attributable to Cogdell Spencer Inc. common shareholders
    
    
    (104
    )
    
    
    (70
    )Net loss per common share attributable to Cogdell Spencer Inc.
common shareholder  basic and diluted
    
    $
    (2.18
    )
    
    $
    (2.15
    )
  77




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  Property Dispositions
   December 31,
    
    
    December 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2008Revenues:Rental revenues
    
    $
    139
    
    
    $
    354
    
    
    $
    378Total revenues
    
    
    139
    
    
    
    354
    
    
    
    378Expenses:Property operating and management
    
    
    133
    
    
    
    247
    
    
    
    311Depreciation and amortization
    
    
    
    
    
    
    137
    
    
    
    137Interest expense
    
    
    
    
    
    
    138
    
    
    
    142Total expenses
    
    
    133
    
    
    
    522
    
    
    
    590Income (loss) from discontinued operations before impairment of real estate property
    
    
    6
    
    
    
    (168
    )
    
    
    (212
    )Impairment of real estate property
    
    
    
    
    
    
    (1,359
    )
    
    
    Gain on sale of discontinued operations
    
    
    264
    
    
    
    
    
    
    
    Total discontinued operations
    
    $
    270
    
    
    $
    (1,527
    )
    
    $
    (212
    )
  Recorded Valueas ofDecember 31,
    
    
    Fair Value Measurement as of December 31, 2009
    
    
    TotalDescription
    
    2009
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    LossesOther assets  held for sale
    
    $
    2,200
    
    
    $
    
    
    
    $
    2,200
    
    
    $
    
    
    
    $
    1,359
 6. Business Segments
   78




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
   79




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  Design-BuildProperty
    
    
    and
    
    
    Intersegment
    
    
    UnallocatedYear ended December 31, 2010
    
    Operations
    
    
    Development
    
    
    Eliminations
    
    
    and Other
    
    
    TotalRevenues:Rental revenue
    
    $
    87,895
    
    
    $
    
    
    
    $
    (92
    )
    
    $
    
    
    
    $
    87,803Design-Build
contract revenue
and other sales
    
    
    
    
    
    
    113,997
    
    
    
    (22,741
    )
    
    
    
    
    
    
    91,256Property management
and other fees
    
    
    3,212
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,212Development
management and
other income
    
    
    
    
    
    
    5,861
    
    
    
    (5,715
    )
    
    
    
    
    
    
    146Total revenues
    
    
    91,107
    
    
    
    119,858
    
    
    
    (28,548
    )
    
    
    
    
    
    
    182,417Certain operating
expenses:Property operating
and management
    
    
    33,664
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    33,664Design-Build
contracts and
development
management
    
    
    
    
    
    
    97,561
    
    
    
    (25,560
    )
    
    
    
    
    
    
    72,001Selling, general,
and administrative
    
    
    
    
    
    
    17,373
    
    
    
    (92
    )
    
    
    
    
    
    
    17,281Intangible asset
impairment charges
    
    
    
    
    
    
    127,041
    
    
    
    
    
    
    
    
    
    
    
    127,041Total certain
operating expenses
    
    
    33,664
    
    
    
    241,975
    
    
    
    (25,652
    )
    
    
    
    
    
    
    249,98757,443
    
    
    
    (122,117
    )
    
    
    (2,896
    )
    
    
    
    
    
    
    (67,570
    )Interest and other
income
    
    
    607
    
    
    
    3
    
    
    
    
    
    
    
    45
    
    
    
    655Corporate general
and administrative
expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,130
    )
    
    
    (13,130
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21,994
    )
    
    
    (21,994
    )Interest rate
derivative expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (371
    )
    
    
    (371
    )Benefit from income
taxes applicable to
funds from
operations modified
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,396
    
    
    
    15,396Non-real estate
related
depreciation and
amortization
    
    
    
    
    
    
    (997
    )
    
    
    
    
    
    
    (229
    )
    
    
    (1,226
    )Earnings from
unconsolidated real
estate
partnerships,
before real estate
related
depreciation and
amortization
    
    
    26
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    26Noncontrolling
interests in real
estate
partnerships,
before real estate
related
depreciation and
amortization
    
    
    (2,031
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,031
    )Discontinued
operations, before
real estate related
depreciation and
amortization
    
    
    9
    
    
    
    
    
    
    
    
    
    
    
    (3
    )
    
    
    6Dividends on
preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (208
    )
    
    
    (208
    )Funds from
operations modified
(FFOM)
    
    
    56,054
    
    
    
    (123,111
    )
    
    
    (2,896
    )
    
    
    (20,494
    )
    
    
    (90,447
    )Amortization of
intangibles related
to purchase
accounting, net of
income tax benefit
    
    
    (169
    )
    
    
    (2,282
    )
    
    
    
    
    
    
    956
    
    
    
    (1,495
    )Funds from
operations (FFO)
    
    
    55,885
    
    
    
    (125,393
    )
    
    
    (2,896
    )
    
    
    (19,538
    )
    
    
    (91,942
    )Real estate related
depreciation and
amortization
    
    
    (29,177
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (29,177
    )Gain on sale of
real estate
property
    
    
    264
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    264Noncontrolling
interests in real
estate
partnerships,
before real estate
related
depreciation and
amortization
    
    
    2,031
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,031Dividends on
preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    208
    
    
    
    208Net income (loss)
    
    $
    29,003
    
    
    $
    (125,393
    )
    
    $
    (2,896
    )
    
    $
    (19,330
    )
    
    $
    (118,616
    )Total assets
    
    $
    585,182
    
    
    $
    47,457
    
    
    $
    
    
    
    $
    301
    
    
    $
    632,940
  80




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Design-BuildProperty
    
    
    and
    
    
    Intersegment
    
    
    UnallocatedYear ended December 31, 2009
    
    Operations
    
    
    Development
    
    
    Eliminations
    
    
    and Other
    
    
    TotalRevenues:Rental revenue
    
    $
    79,578
    
    
    $
    
    
    
    $
    (92
    )
    
    $
    
    
    
    $
    79,486Design-Build contract revenue and
other sales
    
    
    
    
    
    
    176,124
    
    
    
    (32,708
    )
    
    
    
    
    
    
    143,416Property management and other fees
    
    
    3,336
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,336Development management and other
income
    
    
    
    
    
    
    6,750
    
    
    
    (3,387
    )
    
    
    
    
    
    
    3,363Total revenues
    
    
    82,914
    
    
    
    182,874
    
    
    
    (36,187
    )
    
    
    
    
    
    
    229,601Certain operating expenses:Property operating and management
    
    
    31,810
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,810Design-Build contracts and
development management
    
    
    
    
    
    
    142,305
    
    
    
    (28,344
    )
    
    
    
    
    
    
    113,961Selling, general, and administrative
    
    
    
    
    
    
    20,541
    
    
    
    (92
    )
    
    
    
    
    
    
    20,449Intangible asset impairment charges
    
    
    
    
    
    
    120,920
    
    
    
    
    
    
    
    
    
    
    
    120,920Total certain operating expenses
    
    
    31,810
    
    
    
    283,766
    
    
    
    (28,436
    )
    
    
    
    
    
    
    287,14051,104
    
    
    
    (100,892
    )
    
    
    (7,751
    )
    
    
    
    
    
    
    (57,539
    )Interest and other income
    
    
    541
    
    
    
    48
    
    
    
    
    
    
    
    31
    
    
    
    620Gain on settlement from MEA
Holdings, Inc. transaction
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,905
    
    
    
    4,905Corporate general and
administrative expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,836
    )
    
    
    (11,836
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21,711
    )
    
    
    (21,711
    )Interest rate derivative expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,511
    )
    
    
    (2,511
    )Benefit from income taxes
applicable to funds from operations
modified
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,356
    
    
    
    20,356Non-real estate related
depreciation and amortization
    
    
    
    
    
    
    (779
    )
    
    
    
    
    
    
    (225
    )
    
    
    (1,004
    )Earnings from unconsolidated real
estate partnerships, before real
estate related depreciation and
amortization
    
    
    27
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27Noncontrolling interests in real
estate partnerships, before real
estate related depreciation and
amortization
    
    
    (1,049
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,049
    )Discontinued operations and
impairment of real estate property
held for sale, before real estate
related depreciation and
amortization
    
    
    (1,253
    )
    
    
    
    
    
    
    
    
    
    
    (137
    )
    
    
    (1,390
    )Funds from operations modified
(FFOM)
    
    
    49,370
    
    
    
    (101,623
    )
    
    
    (7,751
    )
    
    
    (11,128
    )
    
    
    (71,132
    )Amortization of intangibles related
to purchase accounting, net of
income tax benefit
    
    
    (169
    )
    
    
    (4,364
    )
    
    
    
    
    
    
    1,768
    
    
    
    (2,765
    )Funds from operations (FFO)
    
    
    49,201
    
    
    
    (105,987
    )
    
    
    (7,751
    )
    
    
    (9,360
    )
    
    
    (73,897
    )Real estate related depreciation
and amortization
    
    
    (29,114
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (29,114
    )Gain on sale of real estate property
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Noncontrolling interests in real
estate partnerships, before real
estate related depreciation and
amortization
    
    
    1,049
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,049Net income (loss)
    
    $
    21,136
    
    
    $
    (105,987
    )
    
    $
    (7,751
    )
    
    $
    (9,360
    )
    
    $
    (101,962
    )Total assets
    
    $
    555,072
    
    
    $
    195,799
    
    
    $
    
    
    
    $
    1,792
    
    
    $
    752,663
  81




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Design-BuildProperty
    
    
    and
    
    
    Intersegment
    
    
    UnallocatedYear ended December 31, 2008
    
    Operations
    
    
    Development
    
    
    Eliminations
    
    
    and Other
    
    
    TotalRevenues:Rental revenue
    
    $
    77,464
    
    
    $
    
    
    
    $
    (43
    )
    
    $
    
    
    
    $
    77,421Design-Build contract revenue and
other sales
    
    
    
    
    
    
    258,132
    
    
    
    (4,536
    )
    
    
    
    
    
    
    253,596Property management and other fees
    
    
    3,460
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,460Development management and
other income
    
    
    
    
    
    
    1,688
    
    
    
    (803
    )
    
    
    
    
    
    
    885Total revenues
    
    
    80,924
    
    
    
    259,820
    
    
    
    (5,382
    )
    
    
    
    
    
    
    335,362Certain operating expenses:Property operating and management
    
    
    31,065
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,065Design-Build contracts and
development
management
    
    
    
    
    
    
    218,731
    
    
    
    (4,712
    )
    
    
    
    
    
    
    214,019Selling, general, and administrative
    
    
    
    
    
    
    20,184
    
    
    
    (43
    )
    
    
    
    
    
    
    20,141Total certain operating expenses
    
    
    31,065
    
    
    
    238,915
    
    
    
    (4,755
    )
    
    
    
    
    
    
    265,22549,859
    
    
    
    20,905
    
    
    
    (627
    )
    
    
    
    
    
    
    70,137Interest and other income
    
    
    597
    
    
    
    149
    
    
    
    
    
    
    
    176
    
    
    
    922Corporate general and administrative
expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,074
    )
    
    
    (10,074
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (25,017
    )
    
    
    (25,017
    )Benefit from income taxes applicable to
funds from operations modified
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,860
    )
    
    
    (3,860
    )Non-real estate related depreciation
and
amortization
    
    
    
    
    
    
    (1,129
    )
    
    
    
    
    
    
    (230
    )
    
    
    (1,359
    )Earnings from unconsolidated real
estate
partnerships, before real estate
related
depreciation and amortization
    
    
    35
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    35Noncontrolling interests in real estate
partnerships, before real estate
related
depreciation and amortization
    
    
    (1,346
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,346
    )Discontinued operations, before real
estate
related depreciation and amortization
    
    
    67
    
    
    
    
    
    
    
    
    
    
    
    (142
    )
    
    
    (75
    )Funds from operations modified (FFOM)
    
    
    49,212
    
    
    
    19,925
    
    
    
    (627
    )
    
    
    (39,147
    )
    
    
    29,363Amortization of intangibles related to
purchase accounting, net of income
tax benefit
    
    
    (169
    )
    
    
    (12,918
    )
    
    
    
    
    
    
    5,104
    
    
    
    (7,983
    )Funds from operations (FFO)
    
    
    49,043
    
    
    
    7,007
    
    
    
    (627
    )
    
    
    (34,043
    )
    
    
    21,380Real estate related depreciation and
amortization
    
    
    (30,583
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (30,583
    )Gain on sale of real estate property
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Noncontrolling interests in real estate
partnerships, before real estate
related
depreciation and amortization
    
    
    1,346
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,346Net income (loss)
    
    $
    19,806
    
    
    $
    7,007
    
    
    $
    (627
    )
    
    $
    (34,043
    )
    
    $
    (7,857
    )Total assets
    
    $
    545,714
    
    
    $
    353,054
    
    
    $
    
    
    
    $
    1,322
    
    
    $
    900,090
  82




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 7. Contracts
  December 31,
    
    
    December 31,2010
    
    
    2009Costs and estimated earnings on uncompleted contracts
    
    $
    48,394
    
    
    $
    79,374Billings to date
    
    
    (49,336
    )
    
    
    (90,701
    )Net billings in excess of costs and estimated earnings
    
    $
    (942
    )
    
    $
    (11,327
    )
  December 31,
    
    
    December 31,2010
    
    
    2009Costs and estimated earnings in excess of billings (1)
    
    $
    988
    
    
    $
    1,862Billings in excess of costs and estimated earnings
    
    
    (1,930
    )
    
    
    (13,189
    )Net costs and estimated earnings in excess of billings
    
    $
    (942
    )
    
    $
    (11,327
    )
 (1)
    
    Included in Other assets in the consolidated balance sheet  8. Goodwill and Intangible Assets
     83




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 For the year ended December 31, 2010
   Fair Value MeasurementDescription
    
    Recorded Value
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    Total LossesGoodwill
    
    $
    22,882
    
    
    $
    
    
    
    $
    
    
    
    $
    22,882
    
    
    $
    (85,801
    )Design-build customer relationships
    
    
    1,153
    
    
    
    
    
    
    
    
    
    
    
    1,161
    
    
    
    Trade names and trademarks
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (41,240
    )Design-build signed contracts
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,130
    
    
    
    Design-build proposals
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    938
    
    
    
    $
    24,035
    
    
    $
    
    
    
    $
    
    
    
    $
    27,111
    
    
    $
    (127,041
    )
   Accumulated
    
    
    NetGross Amount
    
    
    Impairment
    
    
    Carrying ValueGoodwill as of January 1, 2010
    
    $
    180,438
    
    
    $
    (71,755
    )
    
    $
    108,683Impairment losses
    
    
    
    
    
    
    (85,801
    )
    
    
    (85,801
    )Goodwill as of December 31, 2010
    
    $
    180,438
    
    
    $
    (157,556
    )
    
    $
    22,882Trade names and trademarks as
of January 1, 2010
    
    $
    75,968
    
    
    $
    (34,728
    )
    
    $
    41,240Impairment losses
    
    
    
    
    
    
    (41,240
    )
    
    
    (41,240
    )Tradenames and trademarks as of
December 31, 2010
    
    $
    75,968
    
    
    $
    (75,968
    )
    
    $
    
  Accumulated
    
    
    NetGross Amount
    
    
    Amortization
    
    
    Carrying ValueIn place lease value and deferred leasing costs
    
    $
    43,284
    
    
    $
    (30,721
    )
    
    $
    12,563Ground leases
    
    
    3,776
    
    
    
    (650
    )
    
    
    3,126Property management contracts
    
    
    2,097
    
    
    
    (763
    )
    
    
    1,334Design-build customer relationships
    
    
    1,789
    
    
    
    (636
    )
    
    
    1,153Above market tenant leases
    
    
    1,559
    
    
    
    (1,134
    )
    
    
    425Design-build signed contracts
    
    
    13,253
    
    
    
    (13,253
    )
    
    
    Design-build proposals
    
    
    2,129
    
    
    
    (2,129
    )
    
    
    Total amortizing intangible
assets
    
    $
    67,887
    
    
    $
    (49,286
    )
    
    $
    18,601
  84




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  For the years ending:2011
    
    
    3,7222012
    
    
    2,7322013
    
    
    1,8052014
    
    
    1,6602015
    
    
    1,190Thereafter
    
    
    7,492$
    18,601
 For the year ended December 31, 2009
   Fair Value MeasurementDescription
    
    Recorded Value
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    Total LossesGoodwill
    
    $
    108,683
    
    
    $
    
    
    
    $
    
    
    
    $
    108,683
    
    
    $
    (71,755
    )Trade names and trademarks
    
    
    41,240
    
    
    
    
    
    
    
    
    
    
    
    41,240
    
    
    
    (34,728
    )Design-build proposals
    
    
    2,129
    
    
    
    
    
    
    
    
    
    
    
    2,129
    
    
    
    (1,833
    )Design-build customer relationships
    
    
    1,789
    
    
    
    
    
    
    
    
    
    
    
    1,789
    
    
    
    (12,604
    )Design-build signed contracts
    
    
    1,398
    
    
    
    
    
    
    
    
    
    
    
    5,281
    
    
    
    $
    155,239
    
    
    $
    
    
    
    $
    
    
    
    $
    159,122
    
    
    $
    (120,920
    )
   Recorded Value
    
    
    Amortization for the
    
    
    Recorded Valueas of
    
    
    Nine Months Ended
    
    
    as ofMarch 31, 2009
    
    
    December 31, 2009
    
    
    December 31, 2009Goodwill
    
    $
    108,683
    
    
    
    n/a
    
    
    $
    108,683Trade names and trademarks
    
    
    41,240
    
    
    
    n/a
    
    
    
    41,240Design-build proposals
    
    
    2,129
    
    
    $
    (340
    )
    
    
    1,789Design-build customer relationships
    
    
    1,789
    
    
    
    (144
    )
    
    
    1,645Design-build signed contracts
    
    
    1,398
    
    
    
    (1,398
    )
    
    
    $
    155,239
    
    
    $
    (1,882
    )
    
    $
    153,357
  85




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  Accumulated
    
    
    NetGross Amount
    
    
    Impairment
    
    
    Carrying ValueGoodwill as of January 1, 2009
    
    $
    180,438
    
    
    $
    
    
    
    $
    180,438Impairment losses
    
    
    
    
    
    
    (71,755
    )
    
    
    (71,755
    )Goodwill as of December 31, 2009
    
    $
    180,438
    
    
    $
    (71,755
    )
    
    $
    108,683Trade names and trademarks as
of January 1, 2009
    
    $
    75,968
    
    
    $
    
    
    
    $
    75,968Impairment losses
    
    
    
    
    
    
    (34,728
    )
    
    
    (34,728
    )Tradenames and trademarks as of
December 31, 2009
    
    $
    75,968
    
    
    $
    (34,728
    )
    
    $
    41,240
  Accumulated
    
    
    NetGross Amount
    
    
    Amortization
    
    
    Carrying ValueIn place lease value and deferred leasing costs
    
    $
    40,666
    
    
    $
    (27,512
    )
    
    $
    13,154Ground leases
    
    
    3,562
    
    
    
    (515
    )
    
    
    3,047Design-build proposals
    
    
    2,129
    
    
    
    (340
    )
    
    
    1,789Design-build customer relationships
    
    
    1,789
    
    
    
    (144
    )
    
    
    1,645Property management contracts
    
    
    2,097
    
    
    
    (594
    )
    
    
    1,503Above market tenant leases
    
    
    1,559
    
    
    
    (955
    )
    
    
    604Design-build signed contracts
    
    
    13,253
    
    
    
    (13,253
    )
    
    
    Total amortizing intangible
assets
    
    $
    65,055
    
    
    $
    (43,313
    )
    
    $
    21,742
   86




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 9. Debt
  As of December 31, 2010Outstanding as of
    
    
    Outstanding as of
    
    
    Stated Interest
    
    
    Interest
    
    
    Maturity
    
    
    AmortizationDecember 31, 2010
    
    
    December 31, 2009
    
    
    Rate (%)
    
    
    Rate (%)
    
    
    Date
    
    
    (years)Mortgage loans  wholly-owned properties:St. Francis CMOB, St. Francis Professional Medical Center
    
    $
    6,688
    
    
    $
    6,870
    
    
    LIBOR + 1.85
    
    
    5.17
    (1)
    
    
    6/15/2011
    
    
    
    39St. Francis Medical Plaza (Greenville), St. Francis Womens
    
    
    7,184
    
    
    
    7,380
    
    
    LIBOR + 1.85
    
    
    5.17
    (1)
    
    
    6/15/2011
    
    
    
    39Beaufort Medical Plaza
    
    
    4,637
    
    
    
    4,763
    
    
    LIBOR + 1.85
    
    
    5.65
    (1)
    
    
    8/18/2011
    
    
    
    39Mulberry Medical Park
    
    
    863
    
    
    
    923
    
    
    
    6.25
    
    
    
    6.25
    
    
    
    9/15/2011
    
    
    
    10Methodist Professional Center I
    
    
    25,250
    
    
    
    25,466
    
    
    LIBOR + 1.30
    
    
    1.56
    
    
    
    10/31/2011
    
    
    
    30St. Francis Outpatient Surgery Center
    
    
    13,000
    
    
    
    
    
    
    LIBOR + 3.25
    
    
    3.51
    
    
    
    11/29/2011
    
    
    
    Interest onlyRiver Hills Medical Plaza
    
    
    3,445
    
    
    
    3,795
    
    
    LIBOR + 3.75
    
    
    5.53
    (1)
    
    
    12/22/2011
    
    
    
    22East Jefferson Medical Plaza
    
    
    11,600
    
    
    
    11,600
    
    
    LIBOR + 3.75
    
    
    5.55
    (1)
    
    
    1/31/2012
    
    
    
    Interest onlyBarclay Downs
    
    
    4,278
    
    
    
    4,378
    
    
    
    6.50
    
    
    
    6.50
    
    
    
    11/15/2012
    
    
    
    25Providence Medical Office Building I, II and III
    
    
    8,067
    
    
    
    8,327
    
    
    
    6.12
    
    
    
    6.12
    
    
    
    1/12/2013
    
    
    
    25One Medical Park
    
    
    4,852
    
    
    
    5,095
    
    
    
    5.93
    
    
    
    5.93
    
    
    
    11/1/2013
    
    
    
    20Three Medical Park
    
    
    7,455
    
    
    
    7,673
    
    
    
    5.55
    
    
    
    5.55
    
    
    
    3/25/2014
    
    
    
    25Medical Arts Center of Orangeburg
    
    
    2,259
    
    
    
    2,365
    
    
    LIBOR + 3.25
    
    
    6.00
    (2)
    
    
    5/5/2014
    
    
    
    20Lancaster Rehabilitation Hospital
    
    
    9,463
    
    
    
    9,621
    
    
    
    6.71
    
    
    
    6.71
    
    
    
    6/26/2014
    
    
    
    25Lancaster Rehabilitation Hospital
    
    
    2,084
    
    
    
    26
    
    
    
    6.79
    
    
    
    6.79
    
    
    
    6/26/2014
    
    
    
    25Rowan Outpatient Surgery Center
    
    
    3,148
    
    
    
    3,237
    
    
    
    6.00
    
    
    
    6.00
    
    
    
    7/6/2014
    
    
    
    25East Jefferson MOB
    
    
    8,735
    
    
    
    8,968
    
    
    
    6.01
    
    
    
    6.01
    
    
    
    8/10/2014
    
    
    
    25Rocky Mount Kidney Center
    
    
    962
    
    
    
    1,000
    
    
    
    6.75
    
    
    
    6.75
    
    
    
    8/21/2014
    
    
    
    15Randolph Medical Park, Lincoln/Lakemont Family Practice, and Northcross Family Physicians
    
    
    7,303
    
    
    
    7,481
    
    
    
    7.00
    
    
    
    7.00
    
    
    
    10/15/2014
    
    
    
    20Rocky Mount Medical Park
    
    
    10,279
    
    
    
    6,794
    
    
    LIBOR + 3.50
    
    
    3.76
    (3)
    
    
    10/22/2014
    
    
    
    25MRMC MOB I
    
    
    5,905
    
    
    
    5,993
    
    
    
    7.33
    
    
    
    7.33
    
    
    
    11/1/2014
    
    
    
    25HealthPartners Medical & Dental Clinics
    
    
    12,065
    
    
    
    4,339
    
    
    LIBOR + 3.25
    
    
    6.80
    (1)
    
    
    11/1/2014
    
    
    
    22.5
    (4)Copperfield Medical Mall, Harrisburg Medical Mall, Midland
Medical Park and Weddington & Internal/Pediatric Medicine
    
    
    8,017
    
    
    
    8,268
    
    
    LIBOR + 1.50
    
    
    3.25
    (5)
    
    
    12/15/2014
    
    
    
    25Peerless Crossing Medical Center
    
    
    7,253
    
    
    
    7,354
    
    
    
    6.06
    
    
    
    6.06
    
    
    
    9/1/2016
    
    
    
    30Central NY Medical Center
    
    
    24,500
    
    
    
    24,500
    
    
    
    6.22
    
    
    
    6.22
    
    
    
    7/15/2017
    
    
    
    Interest onlyPalmetto Health Parkridge
    
    
    13,500
    
    
    
    13,500
    
    
    
    5.68
    
    
    
    5.68
    
    
    
    6/1/2017
    
    
    
    Interest only
    (6)Summit Professional Plaza I and II
    
    
    15,925
    
    
    
    15,925
    
    
    
    6.18
    
    
    
    6.18
    
    
    
    9/1/2017
    
    
    
    Interest onlyHealth Park Medical Office Building
    
    
    6,901
    
    
    
    7,000
    
    
    
    7.50
    
    
    
    7.50
    
    
    
    12/1/2019
    
    
    
    25Medical Center Physicians Tower
    
    
    14,707
    
    
    
    8,582
    
    
    LIBOR + 2.50
    
    
    6.19
    (1)
    
    
    3/1/2019
    
    
    
    25University Physicians  Grants Ferry
    
    
    10,408
    
    
    
    4,922
    
    
    LIBOR + 2.25
    
    
    5.95
    (1)
    
    
    4/20/2019
    
    
    
    25
    (4)Roper Medical Office Building
    
    
    9,281
    
    
    
    9,430
    
    
    
    7.10
    
    
    
    7.10
    
    
    
    6/1/2019
    
    
    
    25Total / weighted average mortgages  wholly-owned properties
    
    
    270,014
    
    
    
    235,575
    
    
    
    
    
    
    
    5.31Secured revolving credit facility:Tranche I
    
    
    
    
    
    
    50,000
    
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aTranche II
    
    
    30,000
    
    
    
    30,000
    
    
    LIBOR + 1.15
    
    
    4.26
    (1)
    
    
    3/1/2014
    (8)
    
    
    Interest onlyTranche III
    
    
    15,000
    
    
    
    
    
    
    LIBOR + 1.15
    
    
    1.41
    
    
    
    3/1/2014
    (8)
    
    
    Interest onlyTotal / weighted average secured revolving credit facility
    
    
    45,000
    
    
    
    80,000
    
    
    
    
    
    
    
    3.31Term Loan
    
    
    
    
    
    
    50,000
    
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/a
    
    
    
    n/aConsolidated real estate partnerships:Alamance Regional Mebane Outpatient Center
    
    
    10,838
    
    
    
    12,262
    
    
    LIBOR + 1.30
    
    
    1.56
    
    
    
    5/1/2011
    
    
    
    30Alamance Regional Mebane Outpatient Center
    
    
    1,470
    
    
    
    1,470
    
    
    LIBOR + 4.00
    
    
    4.26
    
    
    
    5/1/2011
    
    
    
    Interest onlyEnglish Road Medical Center
    
    
    5,162
    
    
    
    5,265
    
    
    
    6.03
    
    
    
    6.03
    
    
    
    3/1/2012
    
    
    
    25Lancaster ASC MOB
    
    
    10,210
    
    
    
    10,445
    
    
    LIBOR + 1.20
    
    
    5.23
    (1)
    
    
    3/2/2015
    
    
    
    25Woodlands Center for Specialized Medicine
    
    
    16,610
    
    
    
    15,786
    
    
    LIBOR + 1.50
    
    
    6.21
    (1)
    
    
    9/26/2018
    
    
    
    25Bonney Lake Medical Office Building
    
    
    2,937
    
    
    
    
    
    
    LIBOR + 3.25
    
    
    3.51
    (7)
    
    
    2/5/2019
    
    
    
    25
    (4)Total / weighted average consolidated real estate partnerships
    
    
    47,227
    
    
    
    45,228
    
    
    
    
    
    
    
    4.68Total / weighted average debt
    
    
    362,241
    
    
    
    410,803Unamortized premium
    
    
    62
    
    
    
    89Total / weighted average debt
    
    $
    362,303
    
    
    $
    410,892
    
    
    
    
    
    
    
    4.98
 
 (1)
    
    Represents the fixed rate for floating rate loans that have been swapped to fixed.(2)
    
    Minimum interest of 6.00%.(3)
    
    Maximum interest of 6.50%.(4)
    
    Interest only during construction period.(5)
    
    Maximum interest of 8.25%; minimum interest of 3.25%.(6)
    
    Interest only through June 2012. Principal and interest payments from July 2012 through June 2017.(7)
    
    In February 2011 we entered into a forward starting interest rate swap agreement that effectively fixes the interest rate 6.44% beginningOctober 2011, when the construction phase of the loan expires and converts to an amortizing loan.(8)
    
    In 2011, we amended and restated the Credit Facility thereby extending its maturity.   87




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COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Secured Revolving Credit Facility
    Term Loan
    88




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COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Scheduled maturities
  For the year ending:2011
    
    $
    77,4432012
    
    
    28,0462013
    
    
    15,9762014
    
    
    109,2122015
    
    
    11,422Thereafter
    
    
    120,142$
    362,241
    89




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COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 10. Derivative Financial Instruments
  As of December 31, 2010
    
    
    December 31, 2010
    
    
    December 31, 2009Notional
    
    
    
    
    
    
    
    
    
    
    Effective
    
    
    ExpirationEntity/Property
    
    Amount
    
    
    Receive Rate

    
    Pay Rate
    
    
    Date
    
    
    Date
    
    
    Asset
    
    
    Liability
    
    
    Asset
    
    
    LiabilityCogdell Spencer LP
    
    $
    30,000
    
    
    1 Month LIBOR
    
    
    3.11
    %
    
    
    10/15/2008
    
    
    
    3/10/2011
    
    
    $
    
    
    
    $
    162
    
    
    $
    
    
    
    $
    697St. Francis Community MOB LLC
    
    
    6,688
    
    
    1 Month LIBOR
    
    
    3.32
    %
    
    
    10/15/2008
    
    
    
    6/15/2011
    
    
    
    
    
    
    
    102
    
    
    
    
    
    
    
    246St. Francis Medical Plaza (Greenville)
    
    
    7,184
    
    
    1 Month LIBOR
    
    
    3.32
    %
    
    
    10/15/2008
    
    
    
    6/15/2011
    
    
    
    
    
    
    
    109
    
    
    
    
    
    
    
    264Beaufort Medical Plaza
    
    
    4,637
    
    
    1 Month LIBOR
    
    
    3.80
    %
    
    
    8/18/2008
    
    
    
    8/18/2011
    
    
    
    
    
    
    
    107
    
    
    
    
    
    
    
    216East Jefferson Medical Plaza
    
    
    11,600
    
    
    1 Month LIBOR
    
    
    1.80
    %
    
    
    1/15/2009
    
    
    
    12/23/2011
    
    
    
    
    
    
    
    173
    
    
    
    
    
    
    
    121River Hills Medical Plaza
    
    
    3,295
    
    
    1 Month LIBOR
    
    
    1.78
    %
    
    
    1/15/2009
    
    
    
    1/31/2012
    
    
    
    
    
    
    
    50
    
    
    
    
    
    
    
    33HealthPartners Medical Office Building
    
    
    11,800
    
    
    1 Month LIBOR
    
    
    3.55
    %
    
    
    6/1/2010
    
    
    
    11/1/2014
    
    
    
    
    
    
    
    899
    
    
    
    
    
    
    
    186Lancaster ASC MOB
    
    
    10,390
    
    
    1 Month LIBOR
    
    
    4.03
    %
    
    
    3/14/2008
    
    
    
    3/2/2015
    
    
    
    
    
    
    
    938
    
    
    
    
    
    
    
    567Woodlands Center for Specialized Medicine
    
    
    16,610
    
    
    1 Month LIBOR
    
    
    4.71
    %
    
    
    4/1/2010
    
    
    
    10/1/2018
    
    
    
    
    
    
    
    2,200
    
    
    
    
    
    
    
    1,166Medical Center Physicians Tower
    
    
    14,707
    
    
    1 Month LIBOR
    
    
    3.69
    %
    
    
    9/1/2010
    
    
    
    3/1/2019
    
    
    
    
    
    
    
    921
    
    
    
    271
    
    
    
    University Physicians  Grants Ferry
    
    
    10,408
    
    
    1 Month LIBOR
    
    
    3.70
    %
    
    
    10/1/2010
    
    
    
    4/1/2019
    
    
    
    
    
    
    
    654
    
    
    
    217
    
    
    
    MEA Holdings, LLC
    
    
    n/a
    
    
    
    
    n/a


    
    
    n/a
    
    
    
    n/a
    
    
    
    n/a
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,397$
    
    
    
    $
    6,315
    
    
    $
    488
    
    
    $
    5,893
  Location of Gain or
    
    
    Gain or (Loss)(Loss) Reclassified
    
    
    Reclassified fromGain or (Loss)
    
    
    from AOCI,
    
    
    AOCI,Recognized in AOCI,
    
    
    Noncontrolling
    
    
    NoncontrollingNoncontrolling
    
    
    Interests in
    
    
    Interests inInterests in
    
    
    Operating
    
    
    Operating
    
    Location of Gain or
    
    
    Gain or (Loss)Operating
    
    
    Partnership, and
    
    
    Partnership, and
    
    (Loss) Recognized 
    
    
    Recognized Partnership, and
    
    
    Noncontrolling
    
    
    Noncontrolling
    
    Ineffective Portion
    
    
    Ineffective PortionNoncontrolling
    
    
    Interests in Real
    
    
    Interests in Real
    
    and Amount
    
    
    and AmountInterests in Real
    
    
    Estate Partnerships
    
    
    Estate Partnerships
    
    Excluded from
    
    
    Excluded fromEstate Partnerships 
    
    
    into Income 
    
    
    into Income 
    
    Effectiveness
    
    
    EffectivenessEffective Portion (1)
    
    
    Effective Portion
    
    
    Effective Portion (1)
    
    
    Testing
    
    
    TestingFor the year ended:December 31, 2010
    
    $
    (2,328
    )
    
    Interest Expense

    
    
    $
    (2,390
    )
    

    Interest rate derivative expense
    
    
    $
    (371
    )December 31, 2009
    

    $
    5,185
    
    
    Interest Expense

    

    
    $
    (4,890
    )

    
    Interest rate derivative expense
    
    
    $
    (1,549
    )
 
 (1)
    
    Refer to the Consolidated Statement of Changes in Equity, which summarizes the
activity in Unrealized gain on interest rate swaps, net of tax related to the interest rate swap
agreements.  Fair Value Measurements as ofDecember 31, 2010Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3Liabilities-Derivative financial instruments
    
    $
    6,315
    
    
    $
    
    
    
    $
    6,315
    
    
    $
    
  90




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COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    91




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 11. Commitments and Contingencies
 Construction in Progress
  Estimated
    
    
    Net Rentable
    
    
    
    
    
    
    EstimatedCompletion
    
    
    Square Feet
    
    
    Investment
    
    
    TotalProperty
    
    Location
    
    Date
    
    
    (unaudited)
    
    
    to Date
    
    
    InvestmentGood Sam MOB Investors, LLC
    
    Puyallup, WA
    
    
    4Q 2011
    
    
    
    80,000
    
    
    $
    8,906
    
    
    $
    24,700Bonney Lake MOB Investors, LLC (1)
    
    Bonney Lake, WA
    
    
    3Q 2011
    
    
    
    56,000
    
    
    
    10,220
    
    
    
    17,700Land and pre-construction developments
    
    
    
    
    
    
    
    
    
    
    
    
    3,117
    
    
    
    136,000
    
    
    $
    22,243
    
    
    $
    42,400
 (1)
    
    The Company has a 61.7% ownership interest at December 31, 2010.  Operating Leases
  For the year ending:2011
    
    $
    5,8362012
    
    
    5,2762013
    
    
    4,4992014
    
    
    4,4212015
    
    
    4,342Thereafter
    
    
    40,214$
    64,588
  Tax Protection Agreements
   
    
    a majority-in-interest of the former holders of interests in the predecessor
partnerships or contributing entities (or their successors, which may include us to
the extent any OP units have been redeemed or exchanged) with respect to such
protected asset consent to the sale, transfer of other disposition; provided, however,
with respect to three of the predecessor entities, Cabarrus POB, LLC, Medical
Investors I, LLC and Medical Investors III, LLC, the required consent shall be a
majority-in-interest of the beneficial owners of interests in the predecessor entities
other than Messrs. Cogdell and Spencer and their affiliates; or
 
    
    the Operating Partnership delivers to each such holder of interests, a cash payment
intended to approximate the holders tax liability related to the recognition of such
holders built-in gain resulting from the sale of such protected asset; or
 
    
    the sale, transfer or other disposition would not result in the recognition of any
built-in gain by any such holder of interests.
  92




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COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 Litigation
  Indemnities
  Employees
   93




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COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 12. Equity
 Preferred Shares
  Common Shares and Units
     2010
    
    
    2009
    
    
    2008Common stock shares at beginning of
period
    
    
    42,729
    
    
    
    17,699
    
    
    
    11,948Issuance of common stock
    
    
    7,208
    
    
    
    23,000
    
    
    
    5,608Conversion of OP Units to common stock
    
    
    376
    
    
    
    2,017
    
    
    
    137Issuance of restricted stock grants
    
    
    557
    
    
    
    13
    
    
    
    6Common stock shares at end of period
    
    
    50,870
    
    
    
    42,729
    
    
    
    17,699
  2010
    
    
    2009
    
    
    2008Net loss attributable to Cogdell Spencer
Inc. common shareholders
    
    $
    (104,089
    )
    
    $
    (69,728
    )
    
    $
    (5,773
    )Increase in Cogdell Spencer Inc.
additional paid-in capital for the conversion of OP units into common stock
    
    
    1,959
    
    
    
    18,830
    
    
    
    1,843Change from net loss attributable to Cogdell Spencer Inc. common
shareholders and transfers from
noncontrolling interests
    
    $
    (102,130
    )
    
    $
    (50,898
    )
    
    $
    (3,930
    )
 Dividends and Distributions
   94




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COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
     Noncontrolling Interests in Real Estate Partnerships
   95




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COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 13. Income Taxes
  2010
    
    
    2009
    
    
    2008Current:Federal
    
    $
    
    
    
    $
    (566
    )
    
    $
    3,710State
    
    
    
    
    
    
    (131
    )
    
    
    710Deferred tax expense on intersegment profits
    
    
    67
    
    
    
    (2,813
    )
    
    
    (7
    )Total current
    
    
    67
    
    
    
    (3,510
    )
    
    
    4,413Deferred:Federal
    
    
    (14,001
    )
    
    
    (15,679
    )
    
    
    (4,765
    )State
    
    
    (2,418
    )
    
    
    (2,935
    )
    
    
    (892
    )Total deferred
    
    
    (16,419
    )
    
    
    (18,614
    )
    
    
    (5,657
    )Income tax benefit
    
    $
    (16,352
    )
    
    $
    (22,124
    )
    
    $
    (1,244
    )
  2010
    
    
    2009
    
    
    2008Federal tax (benefit) at 35% statutory rate
    
    $
    (48,480
    )
    
    $
    (42,505
    )
    
    $
    (1,109
    )State income taxes, net of federal benefit
    
    
    (946
    )
    
    
    (1,955
    )
    
    
    (71
    )Deferred tax expense on intersegment profits
    
    
    67
    
    
    
    (2,813
    )
    
    
    (7
    )Nondeductible expenses, primarily goodwill
    
    
    24,534
    
    
    
    25,016
    
    
    
    72Valuation allowance
    
    
    8,718
    
    
    
    
    
    
    
    Other, net
    
    
    (245
    )
    
    
    133
    
    
    
    (129
    )Income tax benefit
    
    $
    (16,352
    )
    
    $
    (22,124
    )
    
    $
    (1,244
    )
  96




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COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  2010
    
    
    2009Deferred tax assets:Deferred interest expense
    
    $
    3,640
    
    
    $
    1,433Net operating loss carryforward
    
    
    3,309
    
    
    
    Accrued expenses and other items
    
    
    2,513
    
    
    
    2,942Intangibles
    
    
    1,844
    
    
    
    Allowance for doubtful accounts receivable
    
    
    1,158
    
    
    
    1,071Unrealized loss on interest rate swap agreement
    
    
    
    
    
    
    626Total deferred tax assets
    
    
    12,464
    
    
    
    6,072Deferred tax liabilities:Corporate property, plant, and equipment
    
    
    (1,107
    )
    
    
    (765
    )Intangibles
    
    
    (450
    )
    
    
    (20,779
    )Prepaid expenses
    
    
    (303
    )
    
    
    (250
    )Other items
    
    
    (51
    )
    
    
    (271
    )Total deferred tax liabilities
    
    
    (1,911
    )
    
    
    (22,065
    )Net deferred tax asset (liability) before valuation allowance
    
    
    10,553
    
    
    
    (15,993
    )Valuation allowance
    
    
    (10,553
    )
    
    
    Net deferred tax liability
    
    $
    
    
    
    $
    (15,993
    )
      97




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 14. Incentive and Share-Based Compensation
      WeightedRestricted
    
    
    
    
    
    
    AverageStock
    
    
    LTIP Units
    
    
    Grant PriceUnvested balance at January 1, 2010
    
    
    5
    
    
    
    120
    
    
    $
    15.43Granted
    
    
    110
    
    
    
    134
    
    
    
    6.44Vested
    
    
    (40
    )
    
    
    (188
    )
    
    
    8.72Forfeited
    
    
    
    
    
    
    (1
    )
    
    
    15.7275
    
    
    
    65
    
    
    $
    10.69Approved for grant
    
    
    447
    
    
    
    
    
    
    
    
    (a)Unvested balance at December 31, 2010
    
    
    522
    
    
    
    65
    
    
    
    n/a
 (a)
    
    Grant date fair value will be determined when the related performance criteria have
been mutually agreed upon by the Compensation Committee and Mr. Braun and approved by our
Board of Directors, which is expected on or before April 30, 2011.  98




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  Restricted
    
    
    LTIPVesting Date
    
    Stock
    
    
    Units2011
    
    
    
    
    
    
    2012
    
    
    
    
    
    
    2013
    
    
    522
    
    
    
    2014
    
    
    
    
    
    
    2015
    
    
    
    
    
    
    65Total
    
    
    522
    
    
    
    65
  99




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 15. 4 01(k) Savings Plans
    100




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 16. Related Party Transactions
    101




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 17. Additional Information
     102




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##### Table of Contents



COGDELL SPENCER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 18. Selected Quarterly Financial Information (unaudited)
  Three Months EndedDecember 31,
    
    
    September 30,
    
    
    June 30,
    
    
    March 31,2010
    
    
    2010
    
    
    2010
    
    
    2010Total revenue
    
    $
    48,498
    
    
    $
    39,309
    
    
    $
    37,009
    
    
    $
    57,602Income (loss) from continuing operations
available to Cogdell Spencer Inc. common
shareholders
    
    $
    (93,515
    )
    
    $
    (1,838
    )
    
    $
    (12,267
    )
    
    $
    3,301Income (loss) from discontinued operations
available to Cogdell Spencer Inc. common
shareholders
    
    
    
    
    
    
    
    
    
    
    246
    
    
    
    (15
    )Net income (loss) available to Cogdell
Spencer Inc. common shareholders
    
    $
    (93,515
    )
    
    $
    (1,838
    )
    
    $
    (12,021
    )
    
    $
    3,286Per share  basic and diluted:Net income (loss) per common share
available to Cogdell Spencer Inc. common
shareholders
    
    $
    (1.84
    )
    
    $
    (0.04
    )
    
    $
    (0.26
    )
    
    $
    0.08Weighted average shares  basic and diluted
    
    
    50,745
    
    
    
    50,083
    
    
    
    46,111
    
    
    
    42,768
 Three Months EndedDecember 31,
    
    
    September 30,
    
    
    June 30,
    
    
    March 31,2009
    
    
    2009
    
    
    2009
    
    
    2009Total revenue
    
    $
    51,296
    
    
    $
    51,313
    
    
    $
    57,376
    
    
    $
    69,616Income (loss) from continuing operations
available to Cogdell Spencer Inc. common
shareholders
    
    $
    2,956
    
    
    $
    1,281
    
    
    $
    (2,285
    )
    
    $
    (70,189
    )Loss from discontinued operations
available to Cogdell Spencer Inc. common
shareholders
    
    
    (1,400
    )
    
    
    (33
    )
    
    
    (30
    )
    
    
    (29
    )Net income (loss) available to Cogdell
Spencer Inc. common shareholders
    
    $
    1,556
    
    
    $
    1,248
    
    
    $
    (2,315
    )
    
    $
    (70,218
    )Per share  basic and diluted:Net income (loss) per common share
available to Cogdell Spencer Inc. common
shareholders
    
    $
    0.04
    
    
    $
    0.03
    
    
    $
    (0.09
    )
    
    $
    (3.90
    )Weighted average shares  basic and diluted
    
    
    42,615
    
    
    
    42,539
    
    
    
    27,088
    
    
    
    17,995
  103




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##### Table of Contents



COGDELL SPENCER INC.
 
 SCHEDULE III
REAL ESTATE AND ACCUMULATED DEPRECIATION
(in thousands)
 CostInitial Costs (I)
    
    
    Capitalized
    
    
    Gross Amount at Which Carried atBuilding and
    
    
    Subsequent to
    
    
    December 31, 2010
    
    
    
    
    
    
    DateImprovements
    
    
    Acquisition or
    
    
    
    
    
    
    Building and
    
    
    
    
    
    
    Accumulated
    
    
    Constructed
    
    
    DateProperty Name
    
    Location
    
    Encumbrances
    
    
    Land
    
    
    (A)
    
    
    Development
    
    
    Land
    
    

Improvements (A)
    
    

Total (B)
    
    
    Depreciation
    
    
    (C)
    
    
    AcquiredVerdugo Hills Professional Bldg I
    
    California
    
    
    (H
    )
    
    $
    1,218
    
    
    $
    8,228
    
    
    $
    1,644
    
    
    $
    1,226
    
    
    $
    9,864
    
    
    $
    11,090
    
    
    $
    2,701
    
    
    
    1972
    
    
    
    2006Verdugo Hills Professional Bldg II
    
    California
    
    
    (H
    )
    
    
    3,531
    
    
    
    8,915
    
    
    
    1,295
    
    
    
    3,555
    
    
    
    10,186
    
    
    
    13,741
    
    
    
    2,243
    
    
    
    1987
    
    
    
    2006Woodlands Center for Specialized Med (J)
    
    Florida
    
    
    16,610
    
    
    
    4,038
    
    
    
    18,443
    
    
    
    56
    
    
    
    4,038
    
    
    
    18,499
    
    
    
    22,537
    
    
    
    692
    
    
    
    2009
    (K)
    
    
    2008
    (K)Augusta POB I
    
    Georgia
    
    
    (H
    )
    
    
    259
    
    
    
    8,431
    
    
    
    2,487
    
    
    
    260
    
    
    
    10,917
    
    
    
    11,177
    
    
    
    2,837
    
    
    
    1978
    
    
    
    2005Augusta POB II
    
    Georgia
    
    
    (H
    )
    
    
    602
    
    
    
    10,646
    
    
    
    851
    
    
    
    605
    
    
    
    11,494
    
    
    
    12,099
    
    
    
    3,309
    
    
    
    1987
    
    
    
    2005Augusta POB III
    
    Georgia
    
    
    (H
    )
    
    
    339
    
    
    
    3,986
    
    
    
    393
    
    
    
    341
    
    
    
    4,377
    
    
    
    4,718
    
    
    
    1,283
    
    
    
    1994
    
    
    
    2005Augusta POB IV
    
    Georgia
    
    
    (H
    )
    
    
    551
    
    
    
    4,672
    
    
    
    533
    
    
    
    554
    
    
    
    5,202
    
    
    
    5,756
    
    
    
    1,527
    
    
    
    1995
    
    
    
    2005Summit Professional Plaza I
    
    Georgia
    
    
    5,096
    
    
    
    1,180
    
    
    
    6,021
    
    
    
    15
    
    
    
    1,181
    
    
    
    6,035
    
    
    
    7,216
    
    
    
    755
    
    
    
    2004
    
    
    
    2007Summit Professional Plaza II
    
    Georgia
    
    
    10,829
    
    
    
    2,000
    
    
    
    12,684
    
    
    
    199
    
    
    
    2,001
    
    
    
    12,882
    
    
    
    14,883
    
    
    
    1,418
    
    
    
    1998
    
    
    
    2007Methodist Professional Center One
    
    Indiana
    
    
    25,250
    
    
    
    
    
    
    
    37,830
    
    
    
    3,038
    
    
    
    
    
    
    
    40,868
    
    
    
    40,868
    
    
    
    7,728
    
    
    
    1985
    
    
    
    2006OLBH Same Day Surgery Ctr, MOB, Garage
    
    Kentucky
    
    
    (H
    )
    
    
    
    
    
    
    13,938
    
    
    
    208
    
    
    
    
    
    
    
    14,146
    
    
    
    14,146
    
    
    
    3,437
    
    
    
    1997
    
    
    
    2005East Jefferson Medical Plaza
    
    Louisiana
    
    
    11,600
    
    
    
    
    
    
    
    16,525
    
    
    
    154
    
    
    
    
    
    
    
    16,679
    
    
    
    16,679
    
    
    
    1,812
    
    
    
    1996
    
    
    
    2008East Jefferson MOB
    
    Louisiana
    
    
    8,734
    
    
    
    
    
    
    
    12,239
    
    
    
    1,012
    
    
    
    
    
    
    
    13,251
    
    
    
    13,251
    
    
    
    3,440
    
    
    
    1985
    
    
    
    2005Health Partners Medical & Dental Clinics
    
    Minnesota
    
    
    12,065
    
    
    
    2,343
    
    
    
    12,737
    
    
    
    
    
    
    
    2,343
    
    
    
    12,737
    
    
    
    15,080
    
    
    
    305
    
    
    
    2010
    (K)
    
    
    2009
    (K)University Physicians  Grants Ferry
    
    Mississippi
    
    
    10,408
    
    
    
    1,787
    
    
    
    11,571
    
    
    
    
    
    
    
    1,787
    
    
    
    11,571
    
    
    
    13,358
    
    
    
    249
    
    
    
    2010
    (K)
    
    
    2009
    (K)Central New York Medical Center and Garage
    
    New York
    
    
    24,500
    
    
    
    2,112
    
    
    
    32,700
    
    
    
    199
    
    
    
    2,113
    
    
    
    32,898
    
    
    
    35,011
    
    
    
    3,154
    
    
    
    1997
    
    
    
    2007Alamance Regional Mebane Outpatient Ctr (J)
    
    North Carolina
    
    
    12,308
    
    
    
    
    
    
    
    15,757
    
    
    
    2,194
    
    
    
    
    
    
    
    17,951
    
    
    
    17,951
    
    
    
    1,695
    
    
    
    2008
    (K)
    
    
    2007
    (K)Barclay Downs
    
    North Carolina
    
    
    4,278
    
    
    
    2,084
    
    
    
    3,363
    
    
    
    421
    
    
    
    2,097
    
    
    
    3,771
    
    
    
    5,868
    
    
    
    1,769
    
    
    
    1987
    
    
    
    2005Birkdale II
    
    North Carolina
    
    
    (H
    )
    
    
    142
    
    
    
    992
    
    
    
    65
    
    
    
    142
    
    
    
    1,057
    
    
    
    1,199
    
    
    
    290
    
    
    
    2001
    
    
    
    2005Birkdale Wellness, Bldgs C, D, E
    
    North Carolina
    
    
    (H
    )
    
    
    1,087
    
    
    
    5,829
    
    
    
    212
    
    
    
    1,095
    
    
    
    6,033
    
    
    
    7,128
    
    
    
    1,745
    
    
    
    1997
    
    
    
    2005Copperfield Medical Mall
    
    North Carolina
    
    
    (D
    )
    
    
    1,380
    
    
    
    4,047
    
    
    
    125
    
    
    
    1,389
    
    
    
    4,163
    
    
    
    5,552
    
    
    
    1,776
    
    
    
    1989
    
    
    
    2005East Rocky Mount Kidney Center
    
    North Carolina
    
    
    (H
    )
    
    
    260
    
    
    
    1,194
    
    
    
    15
    
    
    
    261
    
    
    
    1,208
    
    
    
    1,469
    
    
    
    391
    
    
    
    2000
    
    
    
    2005English Road Medical Center (J)
    
    North Carolina
    
    
    5,162
    
    
    
    228
    
    
    
    4,990
    
    
    
    56
    
    
    
    228
    
    
    
    5,046
    
    
    
    5,274
    
    
    
    2,126
    
    
    
    2002
    
    
    
    2006Gaston Professional Center, Gaston Ambulatory Surgery Center, Gaston Parking
    
    North Carolina
    
    
    (H
    )
    
    
    
    
    
    
    21,358
    
    
    
    1,910
    
    
    
    
    
    
    
    23,268
    
    
    
    23,268
    
    
    
    10,874
    
    
    
    1997
    
    
    
    2005Gateway Medical Office Building
    
    North Carolina
    
    
    (H
    )
    
    
    
    
    
    
    9,281
    
    
    
    1,563
    
    
    
    
    
    
    
    10,844
    
    
    
    10,844
    
    
    
    2,958
    
    
    
    2005
    
    
    
    2005Harrisburg Family Physicians
    
    North Carolina
    
    
    
    
    
    
    270
    
    
    
    509
    
    
    
    102
    
    
    
    271
    
    
    
    610
    
    
    
    881
    
    
    
    269
    
    
    
    1996
    
    
    
    2005Harrisburg Medical Mall
    
    North Carolina
    
    
    (D
    )
    
    
    441
    
    
    
    1,722
    
    
    
    18
    
    
    
    443
    
    
    
    1,738
    
    
    
    2,181
    
    
    
    572
    
    
    
    1997
    
    
    
    2005Lincoln/Lakemont Family Practice Center
    
    North Carolina
    
    
(I
    )
    
    
    270
    
    
    
    1,025
    
    
    
    288
    
    
    
    271
    
    
    
    1,312
    
    
    
    1,583
    
    
    
    553
    
    
    
    1998
    
    
    
    2005Mallard Crossing Medical Park
    
    North Carolina
    
    
    (H
    )
    
    
    1,256
    
    
    
    4,626
    
    
    
    547
    
    
    
    1,266
    
    
    
    5,163
    
    
    
    6,429
    
    
    
    1,468
    
    
    
    1997
    
    
    
    2005Medical Arts Building
    
    North Carolina
    
    
    (H
    )
    
    
    
    
    
    
    7,446
    
    
    
    1,047
    
    
    
    
    
    
    
    8,493
    
    
    
    8,493
    
    
    
    2,101
    
    
    
    1997
    
    
    
    2005
  104




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##### Table of Contents



COGDELL SPENCER INC.
 SCHEDULE III
REAL ESTATE AND ACCUMULATED DEPRECIATION
(in thousands)
 CostInitial Costs (I)
    
    
    Capitalized
    
    
    Gross Amount at Which Carried atBuilding and
    
    
    Subsequent to
    
    
    December 31, 2010
    
    
    
    
    
    
    DateImprovements
    
    
    Acquisition or
    
    
    
    
    
    
    Building and
    
    
    
    
    
    
    Accumulated
    
    
    Constructed
    
    
    DateProperty Name
    
    Location
    
    Encumbrances
    
    
    Land
    
    
    (A)
    
    
    Development
    
    
    Land
    
    

Improvements (A)
    
    

Total (B)
    
    
    Depreciation
    
    
    (C)
    
    
    AcquiredMidland Medical Park
    
    North Carolina
    
    
    (D
    )
    
    
    288
    
    
    
    1,134
    
    
    
    302
    
    
    
    289
    
    
    
    1,435
    
    
    
    1,724
    
    
    
    490
    
    
    
    1998
    
    
    
    2005Mulberry Medical Park
    
    North Carolina
    
    
    863
    
    
    
    
    
    
    
    2,283
    
    
    
    273
    
    
    
    
    
    
    
    2,556
    
    
    
    2,556
    
    
    
    995
    
    
    
    1982
    
    
    
    2005Northcross Family Physicians
    
    North Carolina
    
    
    (I
    )
    
    
    270
    
    
    
    498
    
    
    
    148
    
    
    
    271
    
    
    
    645
    
    
    
    916
    
    
    
    284
    
    
    
    1993
    
    
    
    2005Randolph Medical Park
    
    North Carolina
    
    
    (I
    )
    
    
    1,621
    
    
    
    5,366
    
    
    
    2,521
    
    
    
    1,631
    
    
    
    7,877
    
    
    
    9,508
    
    
    
    2,607
    
    
    
    1973
    
    
    
    2005Rocky Mount Kidney Center
    
    North Carolina
    
    
    962
    
    
    
    198
    
    
    
    1,366
    
    
    
    72
    
    
    
    199
    
    
    
    1,437
    
    
    
    1,636
    
    
    
    472
    
    
    
    1990
    
    
    
    2005Rocky Mount Medical Park
    
    North Carolina
    
    
    10,279
    
    
    
    982
    
    
    
    9,854
    
    
    
    4,054
    
    
    
    990
    
    
    
    13,900
    
    
    
    14,890
    
    
    
    3,745
    
    
    
    1991
    
    
    
    2005Rowan Outpatient Surgery Center
    
    North Carolina
    
    
    3,147
    
    
    
    399
    
    
    
    4,666
    
    
    
    39
    
    
    
    401
    
    
    
    4,703
    
    
    
    5,104
    
    
    
    1,184
    
    
    
    2003
    
    
    
    2005Weddington Internal & Pediatric Medicine
    
    North Carolina
    
    
    (D
    )
    
    
    489
    
    
    
    838
    
    
    
    23
    
    
    
    491
    
    
    
    859
    
    
    
    1,350
    
    
    
    315
    
    
    
    2000
    
    
    
    2005Lancaster ASC MOB (J)
    
    Pennsylvania
    
    
    10,210
    
    
    
    
    
    
    
    12,859
    
    
    
    1,515
    
    
    
    
    
    
    
    14,374
    
    
    
    14,374
    
    
    
    3,037
    
    
    
    2007
    (K)
    
    
    2006
    (K)Lancaster Rehabilitation Hospital
    
    Pennsylvania
    
    
    11,547
    
    
    
    
    
    
    
    11,748
    
    
    
    2,009
    
    
    
    
    
    
    
    13,757
    
    
    
    13,757
    
    
    
    1,386
    
    
    
    2007
    (K)
    
    
    2006
    (K)200 Andrews
    
    South Carolina
    
    
    (H
    )
    
    
    
    
    
    
    2,663
    
    
    
    1,241
    
    
    
    
    
    
    
    3,904
    
    
    
    3,904
    
    
    
    1,157
    
    
    
    1994
    
    
    
    2005Beaufort Medical Plaza
    
    South Carolina
    
    
    4,637
    
    
    
    
    
    
    
    7,399
    
    
    
    174
    
    
    
    
    
    
    
    7,573
    
    
    
    7,573
    
    
    
    1,515
    
    
    
    1999
    
    
    
    2005Carolina Forest Medical Plaza
    
    South Carolina
    
    
    (H
    )
    
    
    
    
    
    
    7,416
    
    
    
    160
    
    
    
    
    
    
    
    7,576
    
    
    
    7,576
    
    
    
    1,441
    
    
    
    2007
    (K)
    
    
    2006
    (K)Mary Black Westside Medical Office Bldg
    
    South Carolina
    
    
    (H
    )
    
    
    
    
    
    
    3,922
    
    
    
    819
    
    
    
    
    
    
    
    4,741
    
    
    
    4,741
    
    
    
    1,123
    
    
    
    1991
    
    
    
    2006Medical Arts Center of Orangeburg
    
    South Carolina
    
    
    2,259
    
    
    
    605
    
    
    
    4,172
    
    
    
    468
    
    
    
    608
    
    
    
    4,637
    
    
    
    5,245
    
    
    
    1,288
    
    
    
    1984
    
    
    
    2005One Medical Park
    
    South Carolina
    
    
    4,852
    
    
    
    
    
    
    
    8,767
    
    
    
    1,118
    
    
    
    
    
    
    
    9,885
    
    
    
    9,885
    
    
    
    2,238
    
    
    
    1984
    
    
    
    2005Palmetto Health Parkridge
    
    South Carolina
    
    
    13,500
    
    
    
    
    
    
    
    16,353
    
    
    
    1,718
    
    
    
    
    
    
    
    18,071
    
    
    
    18,071
    
    
    
    2,593
    
    
    
    2003
    
    
    
    2006Providence MOB I
    
    South Carolina
    
    
    (E
    )
    
    
    
    
    
    
    5,152
    
    
    
    184
    
    
    
    1
    
    
    
    5,335
    
    
    
    5,336
    
    
    
    1,285
    
    
    
    1979
    
    
    
    2005Providence MOB II
    
    South Carolina
    
    
    (E
    )
    
    
    
    
    
    
    2,441
    
    
    
    430
    
    
    
    
    
    
    
    2,871
    
    
    
    2,871
    
    
    
    513
    
    
    
    1985
    
    
    
    2005Providence MOB III
    
    South Carolina
    
    
    (E
    )
    
    
    
    
    
    
    5,459
    
    
    
    617
    
    
    
    1
    
    
    
    6,075
    
    
    
    6,076
    
    
    
    1,142
    
    
    
    1990
    
    
    
    2005River Hills Medical Plaza
    
    South Carolina
    
    
    3,445
    
    
    
    1,428
    
    
    
    4,202
    
    
    
    102
    
    
    
    1,437
    
    
    
    4,295
    
    
    
    5,732
    
    
    
    1,020
    
    
    
    1999
    
    
    
    2005Roper Medical Office Building
    
    South Carolina
    
    
    9,281
    
    
    
    
    
    
    
    11,586
    
    
    
    1,962
    
    
    
    
    
    
    
    13,548
    
    
    
    13,548
    
    
    
    3,872
    
    
    
    1990
    
    
    
    2005Roper Mount Pleasant Medical Office (Long Point)
    
    South Carolina
    
    
    (H
    )
    
    
    
    
    
    
    3,320
    
    
    
    208
    
    
    
    
    
    
    
    3,528
    
    
    
    3,528
    
    
    
    1,225
    
    
    
    2001
    
    
    
    2005St Francis Medical Plaza (Charleston)
    
    South Carolina
    
    
    (H
    )
    
    
    
    
    
    
    3,792
    
    
    
    2,212
    
    
    
    
    
    
    
    6,004
    
    
    
    6,004
    
    
    
    2,883
    
    
    
    2003
    
    
    
    2005St. Francis CMOB
    
    South Carolina
    
    
    (F
    )
    
    
    
    
    
    
    5,934
    
    
    
    880
    
    
    
    
    
    
    
    6,814
    
    
    
    6,814
    
    
    
    2,210
    
    
    
    2001
    
    
    
    2005St. Francis Medical Plaza (Greenville)
    
    South Carolina
    
    
    (G
    )
    
    
    
    
    
    
    8,007
    
    
    
    497
    
    
    
    
    
    
    
    8,504
    
    
    
    8,504
    
    
    
    1,699
    
    
    
    1998
    
    
    
    2005St. Francis Outpatient Surgery Center
    
    South Carolina
    
    
    13,000
    
    
    
    
    
    
    
    13,772
    
    
    
    
    
    
    
    
    
    
    
    13,772
    
    
    
    13,772
    
    
    
    217
    
    
    
    2001
    
    
    
    2010St. Francis Professional Medical Center
    
    South Carolina
    
    
    (F
    )
    
    
    
    
    
    
    5,522
    
    
    
    1,230
    
    
    
    
    
    
    
    6,752
    
    
    
    6,752
    
    
    
    2,055
    
    
    
    1984
    
    
    
    2005St. Francis Womens
    
    South Carolina
    
    
    (G
    )
    
    
    
    
    
    
    7,352
    
    
    
    713
    
    
    
    
    
    
    
    8,065
    
    
    
    8,065
    
    
    
    1,565
    
    
    
    1991
    
    
    
    2005Three Medical Park
    
    South Carolina
    
    
    7,455
    
    
    
    
    
    
    
    10,405
    
    
    
    1,878
    
    
    
    
    
    
    
    12,283
    
    
    
    12,283
    
    
    
    2,648
    
    
    
    1988
    
    
    
    2005Health Park Medical Office Building
    
    Tennessee
    
    
    6,901
    
    
    
    1,862
    
    
    
    13,223
    
    
    
    63
    
    
    
    1,862
    
    
    
    13,286
    
    
    
    15,148
    
    
    
    1,350
    
    
    
    2004
    
    
    
    2007Medical Center Physicians Tower
    
    Tennessee
    
    
    14,707
    
    
    
    
    
    
    
    21,078
    
    
    
    
    
    
    
    
    
    
    
    21,078
    
    
    
    21,078
    
    
    
    719
    
    
    
    2010
    (K)
    
    
    2009
    (K)Peerless Crossing Medical Center
    
    Tennessee
    
    
    7,253
    
    
    
    645
    
    
    
    8,722
    
    
    
    499
    
    
    
    645
    
    
    
    9,221
    
    
    
    9,866
    
    
    
    748
    
    
    
    2006
    
    
    
    2007MRMC MOB I
    
    Virginia
    
    
    5,905
    
    
    
    970
    
    
    
    9,890
    
    
    
    1,329
    
    
    
    976
    
    
    
    11,213
    
    
    
    12,189
    
    
    
    1,902
    
    
    
    1993
    
    
    
    2006St. Marys MOB North 6th & 7th floor
    
    Virginia
    
    
    
    
    
    
    
    
    
    
    3,880
    
    
    
    305
    
    
    
    
    
    
    
    4,185
    
    
    
    4,185
    
    
    
    741
    
    
    
    1968
    
    
    
    2008Total
    
    
    
    $
    277,043
    
    
    $
    37,135
    
    
    $
    546,746
    
    
    $
    50,410
    
    
    $
    37,269
    
    
    $
    597,022
    
    
    $
    634,291
    
    
    $
    119,141(L
    )
 (A)
    -
    Includes building and improvements, site improvements, furniture, fixtures, and equipment and construction in progress.(B)
    -
    The aggregate cost for federal income tax purposes was $638.0 million as of December 31, 2010. Depreciable lives range from 3-50 years.(C)
    -
    Represents the year in which the property was placed in service.(D)
    -
    Collateral for variable rate mortgage which had a balance of $8 million at December 31, 2010.(E)
    -
    Collateral for fixed rate mortgage which had a balance of $8 million at December 31, 2010.(F)
    -
    Collateral for variable rate mortgage which had a balance of $6.7 million at December 31, 2010.(G)
    -
    Collateral for variable rate mortgage which had a balance of $7.2 million at December 31, 2010.(H)
    -
    Collateral for the Credit Facility(I)
    -
    Collateral for fixed rate mortgage which had a balance of $7.3 million at December 31, 2010.(J)
    -
    A consolidated, less than 100% owned, real estate partnership.(K)
    -
    Represents development property, thus Date Acquired reflects the initiation of the first phase of construction and Date Constructed reflects when property began operations.(L)
    -
    Total mortgage notes payable on operational properties as of December 31, 2010 was $314 million and the Company had construction financing with a balance of $2.9 million for Bonney Lake Medical Office Building  105




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##### Table of Contents



COGDELL SPENCER INC.
 
 SCHEDULE III
 REAL ESTATE AND ACCUMULATED DEPRECIATION
(in thousands)
 A summary of activity for real estate properties and accumulated depreciation is as follows:
 Year ended
    
    
    Year ended
    
    
    Year endedDecember 31, 2010
    
    
    December 31, 2009
    
    
    December 31, 2008Real estate properties:Balance, beginning of period
    
    $
    561,124
    
    
    $
    531,932
    
    
    $
    486,279Property acquisitions
    
    
    13,772
    
    
    
    
    
    
    
    20,405Development projects
    
    
    49,516
    
    
    
    22,469
    
    
    
    15,757Purchases of minority interests in Operating Partnership
    
    
    
    
    
    
    
    
    
    
    121Improvements
    
    
    9,879
    
    
    
    10,946
    
    
    
    9,370Discontinued Operations
    
    
    
    
    
    
    (4,223
    )
    
    
    Balance, end of period
    
    $
    634,291
    
    
    $
    561,124
    
    
    $
    531,932Accumulated depreciation:Balance, beginning of period
    
    $
    93,247
    
    
    $
    69,285
    
    
    $
    44,596Depreciation
    
    
    25,894
    
    
    
    24,483
    
    
    
    24,689Discontinued Operations
    
    
    
    
    
    
    (521
    )
    
    
    Balance, end of period
    
    $
    119,141
    
    
    $
    93,247
    
    
    $
    69,285
  106




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##### Table of Contents



Item 9.
    
    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
  
 Item 9A.
    
    Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
   Managements Report on Internal Control over Financial Reporting
     107




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/s/ DELOITTE & TOUCHE LLP
 
  108




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##### Table of Contents



Changes in Internal Control over Financial Reporting
  
 Item 9B.
    
    Other Information
  
 PART III
 
 Item 10.
    
    Directors, Executive Officers, and Corporate Governance
   Guidelines
   
 Item 11.
    
    Executive Compensation
  
 Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters
   109




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Item 13.
    
    Certain Relationships, Related Transactions, and Director Independence
  
 Item 14.
    
    Principal Accountant Fees and Services
  
 PART IV
 
 Item 15.
    
    Exhibits and Financial Statement Schedules
 3.1
    
    
    Articles of Amendment and Restatement of
Cogdell Spencer Inc., incorporated by
reference to Exhibit 3.1 of the Companys
Registration Statement on Form S-11 (File
No. 333-127396).3.2
    
    
    Articles Supplementary designating Cogdell
Spencer Inc.s 8.500% Series A Cumulative
Redeemable Perpetual Preferred Stock,
liquidation preference $25.00 per share,
par value $0.01 per share, incorporated by
reference to Exhibit 3.2 of Cogdell Spencer
Inc.s Registration Statement on Form 8-A
(File No. 001-32649).3.3
    
    
    Bylaws of Cogdell Spencer Inc.,
incorporated by reference to Exhibit 3.2 of
Cogdell Spencer Inc.s Registration
Statement on Form S-11 (File No.
333-127396).3.4
    
    
    Second Amendment to First Amended and
Restated Agreement of Limited Partnership
of Cogdell Spencer LP, incorporated by
reference to Exhibit 10.1 of Cogdell
Spencer Inc.s Current Report on Form 8-K
filed with the SEC on December 21, 2010.3.5
    
    
    First Amendment to First Amended and
Restated Agreement of Limited Partnership
of Cogdell Spencer LP., incorporated by
reference to Exhibit 3.1 of the Companys
Quarterly Report on Form 10-Q for the
quarter ended March 31, 2008.3.6
    
    
    Amended and Restated Agreement of Limited
Partnership of Cogdell Spencer LP,
incorporated by reference to Exhibit 3.3 of
the Companys Registration Statement on
Form S-11 (File No. 333-127396).3.7
    
    
    Declaration of Trust of CS Business Trust
I., incorporated by reference to Exhibit
3.4 of the Companys Registration Statement
on Form S-11 (File No. 333-127396).3.8
    
    
    Declaration of Trust of CS Business Trust
II, incorporated by reference to Exhibit
3.5 of the Companys Registration Statement
on Form S-11 (File No. 333-127396).4.1
    
    
    Form of stock certificate, incorporated by
reference to Exhibit 4.0 of the Companys
Registration Statement on Form S-11 (File
No. 333-127396).4.2
    
    
    Form of stock certificate evidencing the
8.500% Series A Cumulative Redeemable
Perpetual Preferred Stock, liquidation
preference $25.00 per share, par value
$0.01 per share, incorporated by reference
to Exhibit 4.1 of Cogdell Spencer Inc.s
Registration Statement on Form 8-A (File
No. 001-32649).10.1
    
    
    Form of Registration Rights Agreement, by
and among Cogdell Spencer Inc. and the
parties listed on Schedule I thereto,
incorporated by reference to Exhibit 10.1
of the Companys Quarterly Report on Form
10-Q for the quarter ended September 30,
2005.10.2
    
    
    Cogdell Spencer Inc. 2010 Long Term
Incentive Compensation Plan, incorporated
by reference to Exhibit 10.1 of the
Companys Current Report on Form 8-K (File
No. 001-32649) filed with the SEC on May 7,
2010 (Items 5.02 and 5.07).10.3
    
    
    Form of 2005 Long-Term Stock Incentive
Plan. incorporated by reference to Exhibit
10.3 of the Companys Registration
Statement on Form S-11 (File No.
333-127396).
  110




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10.4
    
    
    Form of Long-Term Stock Incentive Plan
Award for employees without employment
agreements, incorporated by reference to
Exhibit 10.4 of the Companys Registration
Statement on Form S-11 (File No.
333-127396).10.5
    
    
    Form of Cogdell Spencer Inc. Performance
Bonus Plan, incorporated by reference to
Exhibit 10.5 of the Companys Registration
Statement on Form S-11 (File No.
333-127396).10.6
    
    
    Merger Agreement for Cogdell Spencer Inc.,
CS Merger Sub LLC and Cogdell Spencer
Advisors, Inc. dated August 9, 2005,
incorporated by reference to Exhibit 10.6
of the Companys Registration Statement on
Form S-11 (File No. 333-127396).10.7
    
    
    Form of Indemnification Agreement,
incorporated by reference to Exhibit 10.7
of the Companys Registration Statement on
Form S-11 (File No. 333-127396).10.8
    
    
    Amendment to Employment Agreement, dated
December 31, 2010, by and between Cogdell
Spencer Inc. and James W. Cogdell,
incorporated by reference to Exhibit 10.1
of the Companys Current Report on Form 8-K
filed with the SEC on January 5, 2011.10.9
    
    
    Employment Agreement, dated October 21,
2005, by and between Cogdell Spencer Inc.
and James W. Cogdell, incorporated by
reference to Exhibit 10.8 of the Companys
Registration Statement on Form S-11 (File
No. 333-127396).10.10
    
    
    Employment Agreement, dated September 20,
2010, by and between Cogdell Spencer Inc.
and Raymond W. Braun, incorporated by
reference to Exhibit 10.1 of the Companys
Current Report on Form 8-K filed with the
SEC on September 24, 2010.10.11
    
    
    Engagement Letter from the Company to
Realty Capital International Inc.,
incorporated by reference to Exhibit 10.11
of the Companys Registration Statement on
Form S-11 (File No. 333-127396).10.12
    
    
    Irrevocable Exchange and Subscription
Agreement by and among James W. Cogdell,
Cogdell Spencer Advisors, Inc., Cogdell
Spencer LP and Cogdell Spencer Inc.,
incorporated by reference to Exhibit 10.12
of the Companys Registration Statement on
Form S-11 (File No. 333-127396).10.13
    
    
    Irrevocable Exchange and Subscription
Agreement by and among Raymond W. Braun,
Cogdell Spencer Advisors, Inc., Cogdell
Spencer LP and Cogdell Spencer Inc.,
incorporated by reference to Exhibit 10.13
of the Companys Registration Statement on
Form S-11 (File No. 333-127396).10.14
    
    
    Form of Irrevocable Exchange and
Subscription Agreement for all holders of
interests in the Existing Entities, with
the exclusion of James W. Cogdell and
Raymond W. Braun, incorporated by reference
to Exhibit 10.14 of the Companys
Registration Statement on Form S-11 (File
No. 333-127396).10.15
    
    
    Form of Tax Protection Agreement for
Existing Entities, except for Cabarrus POB,
LLC, Medical Investors I, LLC and Medical
Investors III, LLC., incorporated by
reference to Exhibit 10.15 of the Companys
Registration Statement on Form S-11 (File
No. 333-127396).10.16
    
    
    Form of Tax Protection Agreement for
Cabarrus POB, LLC, Medical Investors I, LLC
and Medical Investors III, LLC.,
incorporated by reference to Exhibit 10.16
of the Companys Registration Statement on
Form S-11 (File No. 333-127396).10.17
    
    
    Form of Transaction Agreement by and among
Cogdell Spencer Inc., Cogdell Spencer LP,
the applicable Existing Entity and CS
Merger Sub LLC., incorporated by reference
to Exhibit 10.17 of the Companys
Registration Statement on Form S-11 (File
No. 333-127396).10.18
    
    
    Form of Cogdell Spencer Inc. 2005 Equity
Incentive Plan Restricted Stock Award
Agreement, incorporated by reference to
Exhibit 10.19 of the Companys Registration
Statement on Form S-11 (File No.
333-127396).10.19
    
    
    Put Assignment Agreement dated August 11,
2005., incorporated by reference to Exhibit
10.20 of the Companys Registration
Statement on Form S-11 (File No.
333-127396).
  111




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10.20
    
    
    Form of Consent and Election Form,
incorporated by reference to Exhibit 10.21
of the Companys Registration Statement on
Form S-11 (File No. 333-127396).10.21
    
    
    Form of Long-Term Stock Incentive Plan
Award for employees with employment
agreements, incorporated by reference to
Exhibit 10.22 of the Companys Registration
Statement on Form S-11 (File No.
333-127396).10.22
    
    
    Schedule to Exhibit 10.14 reflecting
consideration to be received by Randolph D.
Smoak, M.D. and Charles M. Handy,
incorporated by reference to Exhibit 10.23
to the Companys Registration Statement on
Form S-11 (File No. 333-127396).10.23
    
    
    Methodist Professional Center Purchase and
Sale Agreement dated December 13, 2005,
incorporated by reference to Exhibit 10.1
of the Companys Quarterly Report on Form
10-Q for the quarter ended March 31, 2006.10.24
    
    
    Hanover Medical Office Building One and
1808/1818 Verdugo Boulevard Purchase and
Sale Agreement dated March 1, 2006,
incorporated by reference to Exhibit 10.2
of the Companys Quarterly Report on Form
10-Q for the quarter ended March 31, 2006.10.25
    
    
    Agreement and Plan of Merger, dated January 23, 2008, by and among Cogdell
Spencer LP, Goldenboy Acquisitions Corp., MEA Holdings, Inc., Marshall Erdman
& Associates, Inc., Marshall Erdman Development, LLC, David Pelisek, David
Lubar and Scott Ransom, incorporated by reference to Exhibit 10.1 of the
Companys Quarterly Report on Form 10-Q for the quarter ended March 31,
2008.10.26
    
    
    Amendment to Agreement and Plan of Merger, dated March 10, 2008, by and among
Cogdell Spencer LP, Goldenboy Acquisitions Corp., MEA Holdings, Inc.,
Marshall Erdman & Associates, Inc., Marshall Erdman Development, LLC, David
Pelisek, David Lubar and Scott Ransom, incorporated by reference to Exhibit
10.2 of the Companys Quarterly Report on Form 10-Q for the quarter ended
March 31, 2008.10.27
    
    
    Escrow Agreement, dated March 10, 2008, by and between Cogdell Spencer LP,
David Pelisek, David Lubar, Scott Ransom and Mellon Investor Services LLC,
incorporated by reference to Exhibit 10.3 of the Companys Quarterly Report
on Form 10-Q for the quarter ended March 31, 2008.10.28
    
    
    Exchange Agent Agreement, dated March 10, 2008, by and between Cogdell
Spencer LP, David Pelisek, David Lubar, Scott Ransom and Mellon Investor
Services LLC, incorporated by reference to Exhibit 10.4 of the Companys
Quarterly Report on Form 10-Q for the quarter ended March 31, 2008.10.29
    
    
    Voting Agreement, dated January 23, 2008, by and among the Shareholders (as
defined therein) of MEA Holdings, Inc. for the benefit of Cogdell Spencer LP
and Goldenboy Acquisitions Corp, incorporated by reference to Exhibit 10.5 of
the Companys Quarterly Report on Form 10-Q for the quarter ended March 31,
2008.10.30
    
    
    Voting Agreement, dated January 23, 2008, by and among Baird Capital Partners
III Limited Partnership, BCP III Affiliates Fund Limited Partnership, BCP III
Special Affiliates Fund Limited Partnership, Lubar Capital LLC, James Cogdell
and Frank Spencer, incorporated by reference to Exhibit 10.6 of the Companys
Quarterly Report on Form 10-Q for the quarter ended March 31, 2008.10.31
    
    
    Contributing Shareholders Voting Agreement, dated March 10, 2008, by and
among James Cogdell, Frank Spencer, David Pelisek, David Lubar and Scott
Ransom, incorporated by reference to Exhibit 10.7 of the Companys Quarterly
Report on Form 10-Q for the quarter ended March 31, 2008.10.32
    
    
    Director Designation Agreement, dated March 10, 2008, by and between Cogdell
Spencer Inc. and David Lubar incorporated by reference to Exhibit 10.8 of the
Companys Quarterly Report on Form 10-Q for the quarter ended March 31, 2008.10.33
    
    
    Registration Rights Agreement, dated March 10, 2008, by and among Cogdell
Spencer Inc. and certain persons listed on Schedule I thereto, incorporated
by reference to Exhibit 10.9 of the Companys Quarterly Report on Form 10-Q
for the quarter ended March 31, 2008.
  112




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10.34
    
    
    Registration Rights Agreement, dated January 28, 2008, by and among Cogdell
Spencer Inc. and KeyBanc Capital Markets Inc. on behalf of the persons listed
on Schedule I thereto, incorporated by reference to Exhibit 10.10 of the
Companys Quarterly Report on Form 10-Q for the quarter ended March 31, 2008.10.35
    
    
    Amended and Restated Guaranty Agreement, dated as of March 1, 2011, among the
Guarantors named therein and Bank of America, N.A., as Agent for the benefit
of the Lenders.10.36
    
    
    Amended and Restated Credit Agreement, dated March 1, 2011, among the
Company, as a Guarantor, Cogdell Spencer LP, as Borrower, and Bank of
America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer,
KeyBank National Association, as Syndication Agent, Branch Banking and Trust
Company, Citicorp North America, Inc. and Wells Fargo Bank, National
Association, as co-documentation agents, and the other lenders thereto,
incorporated by reference to Exhibit 10.2 of Cogdell Spencer Inc.s Current
Report on Form 8-K filed with the SEC on March 7, 2011.10.37
    
    
    Employment Agreement, dated as of September 20, 2010, by and between Erdman
Company and Scott A. Ransom, incorporated by reference to Exhibit 10.2 of
Cogdell Spencer Inc.s Current Report on Form 8-K filed with the SEC on
September 24, 2010.10.38
    
    
    Form of Contribution Agreement by and among Cogdell Spencer Inc., Cogdell
Spencer LP and each of the persons set forth on Schedule 1 to Exhibit 10.15
incorporated by reference to Exhibit 10.15 of the Companys Quarterly Report
on Form 10-Q for the quarter ended March 31, 2008.10.39
    
    
    Contribution Agreement Side Letter, dated March 10, 2008, by Cogdell Spencer
Inc. and Cogdell Spencer LP delivered to David Pelisek, David Lubar and Scott
Ransom, incorporated by reference to Exhibit 10.16 of the Companys Quarterly
Report on Form 10-Q for the quarter ended March 31, 2008.10.40
    
    
    Amended and Restated Employment Agreement, dated December 1, 2008, by and
between Cogdell Spencer Inc., Cogdell Spencer LP and Charles M. Handy,
incorporated by reference to Exhibit 10.1 of the Companys Current Report on
Form 8-K filed with the SEC on December 4, 2008.10.41
    
    
    Separation and Release Agreements, dated July 8, 2008, by and between Cogdell
Spencer Inc., Cogdell Spencer LP and Heidi Wilson, incorporated by reference
to Exhibit 10.1 of the Companys Current Report on Form 8-K filed with the
SEC on July 14, 2008.10.42
    
    
    Letter Agreement, between Cogdell Spencer Inc. and Frank Spencer, dated May
3, 2010, incorporated by reference to Exhibit 10.2 of Cogdell Spencer Inc.s
Current Report on Form 8-K filed with the SEC on May 3, 2010.10.43
    
    
    Award Restricted Stock Award Agreement, effective as of September 24, 2010,
by and between Cogdell Spencer Inc. and Raymond William Braun, incorporated
by reference to Exhibit 10.3 of Cogdell Spencer Inc.s Current Report on Form
8-K filed with the SEC on September 24, 2010.10.44
    
    
    Performance Award Restricted Stock Award Agreement, effective as of September
24, 2010, by and between Cogdell Spencer Inc. and Raymond William Braun,
incorporated by reference to Exhibit 10.4 of Cogdell Spencer Inc.s Current
Report on Form 8-K filed with the SEC on September 24, 2010.10.45
    
    
    Subscription Agreement, effective as of September 20, 2010, by and between
Cogdell Spencer Inc. and Raymond William Braun, incorporated by reference to
Exhibit 10.5 of Cogdell Spencer Inc.s Current Report on Form 8-K filed with
the SEC on September 24, 2010.14.1
    
    
    Code of Ethics, incorporated by reference
to the Annual Report on Form 10-K for the
year ended December 31, 2005.21.1
    
    
    List of Subsidiaries of Cogdell Spencer Inc.23.1
    
    
    (1) Consent of Deloitte & Touche LLP.31.1
    
    
    (1) Certification by the Chief Executive
Officer pursuant to Section 302 of the
Sarbanes-Oxley Act.31.2
    
    
    (1) Certification by the Chief Financial
Officer pursuant to Section 302 of the
Sarbanes-Oxley Act.32.1
    
    
    (1) Certifications pursuant to Section 1350.
 (1)
    
    Filed herewith  113




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##### Table of Contents



SIGNATURES
  COGDELL SPENCER INC.RegistrantDate: March 15, 2011
    /s/ Raymond W. BraunRaymond W. BraunPresident and Chief Executive Officer
(Principal Executive Officer)Date: March 15, 2011
    /s/ Charles M. HandyCharles M. HandyExecutive Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)  Date: March 15, 2011
    /s/ James W. CogdellJames W. CogdellChairman of the Board of DirectorsDate: March 15, 2011
    /s/ Raymond W. BraunRaymond W. BraunPresident, Chief Executive Officer and DirectorDate: March 15, 2011
    /s/ John R. GeorgiusJohn R. GeorgiusDirectorDate: March 15, 2011
    /s/ Richard B. JenningsRichard B. JenningsDirectorDate: March 15, 2011
    /s/ Christopher E. LeeChristopher E. LeeDirectorDate: March 15, 2011
    /s/ David J. LubarDavid J. LubarDirectorDate: March 15, 2011
    /s/ Richard C. NeugentRichard C. NeugentDirectorDate: March 15, 2011
    /s/ Scott A. RansomScott A. RansomDirectorDate: March 15, 2011
    /s/ Randolph D. SmoakRandolph D. Smoak, M.D.Director  114