<PAGE>

                                       
                                       
                                       
                                   FORM 10-Q
                                       
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549
                                       
         [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
                                       
               For the quarterly period ended SEPTEMBER 30, 1997
                                       
                                      OR
                                       
         [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
                                       
                          Commission File No. 1-14166
                                       
                        MERIDIAN INDUSTRIAL TRUST, INC.
            (Exact name of registrant as specified in its charter)

       MARYLAND                              94-3224765
(State or other jurisdiction of         (I.R.S. Employer Identification No.)
incorporation or organization)

   455 MARKET STREET
   17TH FLOOR
   SAN FRANCISCO, CALIFORNIA                    94105
(Address of principal executive offices)      (Zip Code)

Registrant's telephone number, including area code:   (415) 281-3900

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
                          Yes     X         No
                                -----            -----

 Indicate the number of shares outstanding of the common and preferred stock,
                      as of the latest practicable date:
                                       
SHARES OF SERIES B CONVERTIBLE PREFERRED STOCK AS OF NOVEMBER 1, 1997: 2,272,727
SHARES OF COMMON STOCK AS OF NOVEMBER 1, 1997                        :29,893,825
                                       

<PAGE>

-------------------------------------------------------------------------------
                        PART I:  FINANCIAL INFORMATION
-------------------------------------------------------------------------------

     ITEM 1.   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

     The accompanying unaudited condensed consolidated financial statements 
should be read in conjunction with the 1996 Form 10-K of Meridian Industrial 
Trust, Inc. (the "Company") and the other reports filed by the Company since 
December 31, 1996 under sections 13 or 15(d) of the Securities Act of 1934. 
These condensed consolidated statements have been prepared in accordance with 
the instructions of the Securities and Exchange Commission to Form 10-Q and 
do not include all the information and footnotes required by generally 
accepted accounting principles for complete financial statements.

     In the opinion of the Company's management, all adjustments (consisting 
only of a normal, recurring nature) considered necessary for a fair 
presentation of results of operations for the interim periods have been 
included.  The results of consolidated operations for the three and nine 
month periods ended September 30, 1997 are not necessarily indicative of the 
results that may be expected for the year ending December 31, 1997.


                                      1
<PAGE>

                        MERIDIAN INDUSTRIAL TRUST, INC.

                     CONDENSED CONSOLIDATED BALANCE SHEETS
                AS OF SEPTEMBER 30, 1997 AND DECEMBER 31, 1996
                 (UNAUDITED, IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
                                    ASSETS

                                                                                              1997          1996
                                                                                          ----------    ----------
<S>                                                                                       <C>           <C>
INVESTMENT IN REAL ESTATE ASSETS:
Rental Properties Held for Investment                                                     $  680,993    $  318,671
Less: Accumulated Depreciation                                                               (10,273)       (4,217)
                                                                                          ----------    ----------
                                                                                             670,720       314,454
Rental Properties Held for Sale, Net of Accumulated Depreciation of
 $120 and $148 at September 30, 1997 and December 31, 1996, respectively                       2,437         7,530
                                                                                          ----------    ----------
                                                                                             673,157       321,984
Investment in Unconsolidated Joint Venture                                                    21,500            --
Mortgage Notes Receivable                                                                     45,000            --
                                                                                          ----------    ----------
Total Investment in Real Estate Assets                                                       739,657       321,984

OTHER ASSETS:
Cash and Cash Equivalents                                                                     12,722         2,942
Cash Held in Consolidated Partnerships                                                         3,582            --
Restricted Cash and Cash Held In Escrow                                                       12,826         2,314
Accounts Receivable, Net of Reserves of $437 and $571 at September 30, 1997
 and December 31, 1996, respectively                                                           1,835         1,659
Capitalized Loan Fees, Lease Commissions and Other Assets, Net                                12,187         4,164
                                                                                          ----------    ----------
TOTAL ASSETS                                                                              $  782,809    $  333,063
                                                                                          ----------    ----------
                                                                                          ----------    ----------
                       LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
Mortgage Loan                                                                             $   66,094    $   66,094
Unsecured Credit Facility                                                                    178,000        11,500
Mortgage Note Payable, Net                                                                    10,602            --
Accrued Dividends Payable                                                                      8,473         4,648
Accounts Payable, Prepaid Rent and Other Liabilities                                          13,786         7,308
                                                                                          ----------    ----------
TOTAL LIABILITIES                                                                            276,955        89,550
                                                                                          ----------    ----------
Minority Interest in Consolidated Limited Partnerships                                         4,032           --
                                                                                          ----------    ----------
STOCKHOLDERS' EQUITY:
Authorized Shares - 175,000,000 shares of Common Stock and 25,000,000
 shares of Preferred Stock authorized, each with par value of $0.001;
 26,787,319 and 13,595,563 shares of Common Stock issued and outstanding at
 September 30, 1997 and December 31, 1996, respectively; and 2,272,727
 shares of Series B Preferred Stock with a liquidation preference of $35,000
 issued and outstanding at September 30, 1997 and December 31, 1996                               29           16
Additional Paid-in Capital                                                                   507,190      243,683
Distributions in Excess of Income                                                             (5,397)        (186)
                                                                                          ----------    ----------
TOTAL STOCKHOLDERS' EQUITY                                                                   501,822      243,513
                                                                                          ----------    ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                $  782,809    $ 333,063
                                                                                          ----------    ----------
                                                                                          ----------    ----------
</TABLE>

         The accompanying notes are an integral part of these statements.


                                      2
<PAGE>

                        MERIDIAN INDUSTRIAL TRUST, INC.

                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
        FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
                  (UNAUDITED, IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>

                                                           THREE MONTHS ENDED             NINE MONTHS ENDED
                                                              SEPTEMBER 30,                 SEPTEMBER 30,
                                                           1997           1996           1997           1996
                                                        ---------      ---------      ---------      ---------
<S>                                                     <C>            <C>            <C>            <C>
REVENUES:
Rentals from Real Estate Investments                    $  14,707      $  10,092      $  39,271      $  23,464
Interest and Other Income                                     326             85            630            469
                                                        ---------      ---------      ---------      ---------
TOTAL REVENUES                                             15,033         10,177         39,901         23,933
                                                        ---------      ---------      ---------      ---------
EXPENSES:
Interest Expense                                            3,084          1,631          6,868          4,168
Property Taxes                                              1,905          1,373          5,298          3,269
Property Operating Costs                                    1,246          1,170          3,288          2,484
General and Administrative                                  1,413          1,212          3,914          3,000
Depreciation and Amortization                               2,485          1,391          6,701          3,234
                                                        ---------      ---------      ---------      ---------
TOTAL EXPENSES                                             10,133          6,777         26,069         16,155
                                                        ---------      ---------      ---------      ---------
Income Before Gain (Loss) on Sale of Properties
 and Extraordinary Item                                     4,900          3,400         13,832          7,778
Gain (Loss) on Sale of Properties, Net                       (17)            170          (465)            177
                                                        ---------      ---------      ---------      ---------
Income Before Extraordinary Item                            4,883          3,570         13,367          7,955
Extraordinary Item - Expenses Incurred in
 Connection with Debt Restructuring
 and Retirements                                               --             --           (808)          (411)
                                                        ---------      ---------      ---------      ---------
NET INCOME                                               $  4,883       $  3,570      $  12,559       $  7,544
                                                        ---------      ---------      ---------      ---------
                                                        ---------      ---------      ---------      ---------
Net Income                                               $  4,883       $  3,570      $  12,559       $  7,544
Less: Preferred Dividends Declared                           (705)          (706)        (2,114)        (1,706)
                                                        ---------      ---------      ---------      ---------
NET INCOME ALLOCABLE TO COMMON SHARES                    $  4,178       $  2,864      $  10,445       $  5,838
                                                        ---------      ---------      ---------      ---------
                                                        ---------      ---------      ---------      ---------
NET INCOME ALLOCABLE TO COMMON PER WEIGHTED
 AVERAGE COMMON SHARE OUTSTANDING                        $   0.28       $   0.29      $    0.73        $  0.77
                                                        ---------      ---------      ---------      ---------
                                                        ---------      ---------      ---------      ---------
</TABLE>


       The accompanying notes are an integral part of these statements.


                                      3
<PAGE>

                        MERIDIAN INDUSTRIAL TRUST, INC.
                                       
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
             FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
                           (UNAUDITED, IN THOUSANDS)


<TABLE>
<CAPTION>
                                                                               1997           1996
                                                                            ---------       --------
<S>                                                                         <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income                                                                  $  12,559       $  7,544
 Adjustments to Reconcile Net Income to Cash Provided by
  Operating Activities:
   Depreciation and Amortization                                                6,701          3,233
   Amortization of Debt Premium                                                  (102)            --
   Amortization of Financing Costs                                                220            302
   Straight Line Rent                                                          (1,501)          (748)
   Loss (Gain) on Sale of Properties, Net                                         465           (177)
   Extraordinary Item - Expenses Incurred in Connection with
    Debt Restructuring and Debt Retirements                                       808            411
   (Increase) Decrease in Accounts Receivable and Other Assets                 (1,269)           728
   Increase (Decrease) in Accounts Payable, Prepaid Rent and
    Other Liabilities                                                             667         (2,009)
                                                                            ---------       --------
Net Cash Provided by Operating Activities                                      18,548          9,284
                                                                            ---------       --------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Cash Contributed by Merged Trusts                                                 --         11,892
 Net Proceeds from Property Sales                                              16,112          7,794
 Decrease in Restricted Cash and Cash Held in Escrow                            3,353          5,507
 Increase in Cash Held in Consolidated Partnerships                            (3,582)            --
 Net Cash Paid in Connection with Asset Purchase                                   --         (3,257)
 Redemption of Series A Preferred Stock and Accrued Dividends Payable              --            (83)
 Construction Loan Receivable                                                  (1,594)            --
 Investment in Real Estate                                                    167,577)       (62,991)
 Recurring Building Improvements                                                 (994)          (741)
 Recurring Tenant Improvements                                                   (328)          (539)
 Recurring Leasing Commissions                                                   (841)          (885)
 Maturity of Marketable Security                                                   --          2,607
 Receipt of Note Receivable                                                       503            720
 Purchase of Other Assets                                                        (187)          (258)
                                                                            ---------       --------
Net Cash Used in Investing Activities                                        (155,135)       (40,234)
                                                                            ---------       --------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Payments of Capitalized Loan Fees                                               (627)          (536)
 Principal Payments on Mortgage Notes                                          (5,756)            --
 Retirement of Debt and Advances from Affiliates                                   --        (60,158)
 Repayment of Short-Term Loan Payable                                              --         (2,351)
 Borrowings on Unsecured Credit Facility                                      171,000         75,400
 Repayment of Borrowings on Unsecured Credit Facility                          (4,500)       (33,500)
 Distributions Paid to Stockholders                                           (13,945)        (4,793)
 Net Proceeds from Issuance of Common and Preferred Stock, Warrant
  Conversion and Stock Options                                                    195         58,035
                                                                            ---------       --------
Net Cash Provided by Financing Activities                                     146,367         32,097
                                                                            ---------       --------
NET INCREASE IN CASH AND CASH EQUIVALENTS                                       9,780          1,147
Cash and Cash Equivalents -- Beginning of Period                                2,942            475
                                                                            ---------       --------
CASH AND CASH EQUIVALENTS -- END OF PERIOD                                  $  12,722       $  1,622
                                                                            ---------       --------
                                                                            ---------       --------
</TABLE>


       The accompanying notes are an integral part of these statements.


                                      4
<PAGE>

                        MERIDIAN INDUSTRIAL TRUST, INC.
                                       
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                           AS OF SEPTEMBER 30, 1997
       (UNAUDITED, DOLLARS IN THOUSANDS, EXCEPT SHARE AND PROPERTY DATA)
                                       
1.  ORGANIZATION

    Meridian Industrial Trust, Inc. (the "Company") was incorporated in the 
state of Maryland on May 18, 1995. The Company is a self-administered and 
self-managed real estate investment trust ("REIT") engaged primarily in the 
business of owning, acquiring, developing, managing and leasing 
income-producing warehouse/distribution and light industrial properties.  At 
September 30, 1997, the Company's principal asset was its portfolio of 127 
warehouse/distribution properties, 33 light industrial properties and two 
retail properties.  In addition, at September 30, 1997, the Company had eight 
build-to-suit properties under construction.

    On February 23, 1996, the Company merged with Meridian Point Realty Trust 
IV Co., Meridian Point Realty Trust VI Co. and Meridian Point Realty Trust 
VII Co. ("Trust IV," "Trust VI" and "Trust VII," respectively, and 
collectively referred to as the "Merged Trusts"), with the Company as the 
surviving entity (that transaction is referred to below as the "Merger"). In 
addition, concurrent with the Merger, the Company acquired certain properties 
that were subject to certain mortgage notes and other liabilities, from 
Meridian Point Realty Trust '83 ("Trust 83") (that transaction is referred to 
below as the "Asset Purchase").

    Prior to February 23, 1996, the Company had no operations other than 
receiving interest on its investments and paying general and administrative 
expenses.

    The accompanying unaudited condensed consolidated financial statements 
should be read in conjunction with the Company's 1996 Form 10-K and the other 
reports filed by the Company since December 31, 1996 under sections 13 or 
15(d) of the Securities Act of 1934.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    (a)  BASIS OF PRESENTATION  The accompanying condensed consolidated 
financial statements include the results of the Company, its wholly-owned 
subsidiaries and its majority-owned and controlled partnerships.  All 
intercompany transactions have been eliminated.
     
    (b)  USE OF ESTIMATES  The preparation of financial statements in 
conformity with generally accepted accounting principles requires management 
to make estimates and assumptions that affect the reported amounts of assets 
and liabilities, the disclosure of contingent assets and liabilities at the 
date of the financial statements and the reported amounts of revenues and 
expenses during the reporting period. Actual results could differ from those 
estimates.

    (c)  CASH AND CASH EQUIVALENTS  The Company considers all short-term 
investments with an original maturity of three months or less to be cash 
equivalents.

    (d)  NET INCOME PER SHARE  Net income per share is calculated by dividing 
net income, after deduction of preferred stock dividends declared, by the 
weighted average number of shares of the Company's common stock ("Common 
Stock") outstanding during the period. The weighted average number of shares 
of Common Stock outstanding was 15,072,486 and 14,379,696 for the three and 
nine months ended September 30, 1997, respectively.  The weighted average 
number of shares of Common Stock outstanding was 9,715,982 and 7,626,801 for 
the three and nine months ended September 30, 1996, respectively.


                                      5
<PAGE>

    The weighted average number of shares takes into account the dilutive 
effects of stock options granted by the Company to its directors, officers 
and employees pursuant to its stock plan, warrants issued in connection with 
the Merger and shares to be issued pursuant to a stock option agreement with 
one of its stockholders, aggregating to 493,713 and 451,464 additional shares 
of Common Stock for the three and nine months ended September 30, 1997.  For 
the three and nine months ended September 30, 1996, the dilutive effect of 
the stock options granted aggregated to 31,735 additional shares of Common 
Stock.

    During the first quarter of 1997, the Financial Accounting Standards 
Board issued Statement of Financial Accounting Standard (SFAS) No. 128, 
"Earnings Per Share".  SFAS 128 requires the disclosure of basic earnings per 
share and modifies existing guidance for computing diluted earnings per 
share.  Under the new standard, basic earnings per share will be computed as 
earnings divided by the weighted average number of shares of Common Stock 
outstanding, excluding the dilutive effects of stock options and other 
potentially dilutive securities.  The effective date of SFAS No. 128 is 
December 15, 1997, and early adoption is not permitted.  The Company intends 
to adopt SFAS No. 128 during the quarter and year ended December 31, 1997.  
Had the provisions of SFAS No. 128 been applied to the Company's results of 
operations for the three months ended September 30, 1997 and 1996, (i) the 
Company's basic earnings per share would have been $0.29 and $0.30 per share, 
respectively, and $0.75 and $0.77 per share for the nine months ended 
September 30, 1997 and 1996, respectively, and (ii) the Company's diluted 
earnings per share would have been $0.28 and $0.29 per share for the three 
months ended September 30, 1997 and 1996, respectively, and $0.73 and $0.77 
for the nine months ended September 30, 1997 and 1996, respectively.

    May 23, 1997, was the first day of the exercise period for the 
approximately 553,000 warrants ("Warrants") issued to former holders of Trust 
VI and Trust VII common stock in connection with the Merger.  Each Warrant 
entitles the holder to purchase one share of the Company's Common Stock at 
the exercise price of $16.23.  The exercise period ends February 23, 1999.  
As of September 30, 1997 the Company has issued 11,317 shares pursuant to 
exercises of the Warrants.

    (e)  CONSTRUCTION IN PROGRESS  Costs clearly associated with the 
development and construction of a real estate project are capitalized as 
construction in progress.  In addition, interest, real estate taxes, 
insurance and other holding costs are capitalized until the property is 
placed in service.  During the three and nine months ended September 30, 
1997, interest expense totaling $459 and $1,143, respectively, were 
capitalized for properties under construction.  For the three and nine months 
ended September 30, 1996, interest expense totaling $196 and $242, 
respectively, were capitalized for properties under construction.

    (f)  INVESTMENT IN REAL ESTATE  Investments in Real Estate are 
depreciated over 35 years using the straight-line method.  Expenditures for 
maintenance, repairs and improvements which do not materially prolong the 
normal useful life of an asset are charged to operations as incurred.  Tenant 
improvements are capitalized and amortized under the straight-line method 
over the term of the related lease.

3.  MORTGAGE NOTES PAYABLE

    The Company assumed a mortgage note with a principal balance of $5,724 in 
connection with the acquisition of a property located in Corona, California 
on April 29, 1997.  The loan had a maturity date of  February 1, 1998 and 
called for monthly principal and interest payments of $55 based on an 
interest rate of 10% per annum and a ten-year amortization schedule.  On 
September 15, 1997, the Company repaid the outstanding balance on this 
mortgage note amounting to $5,688.


                                      6
<PAGE>

    On May 13, 1997, the Company purchased a property located in Montebello, 
California, subject to a mortgage note bearing an interest rate different 
from the prevailing market rate at the date of acquisition.  This interest 
rate differential was recorded as a premium.  The new loan amounting to 
$10,429 has a maturity date of July 15, 1998 and provides for monthly 
principal and interest payments of $96 based on an interest rate of 9.89% per 
annum and a 30-year amortization schedule.  The premium totaling $324 is 
amortized over the term of the note using the effective interest method.  As 
of September 30, 1997, this mortgage note and debt premium had outstanding 
balances of $10,380 and $222, respectively.

4.  DEBT FACILITIES

    The Company acquired a fixed rate facility (the "Mortgage Loan") in 
connection with the Merger.  The Mortgage Loan has a principal balance of 
$66,094, bears interest at the annual rate of 8.63%, requires interest only 
payments until its maturity in 2005 and is secured by a pool of the Company's 
properties having a net book value of $121,670 as of September 30, 1997.

    Concurrent with the Merger, the Company entered into an unsecured credit 
facility (the "Unsecured Credit Facility").  The Unsecured Credit Facility 
originally bore interest at LIBOR plus 1.7%, was scheduled to mature in 
February 1998, and provided for a maximum borrowing amount of $75,000. On 
April 22, 1997, the Unsecured Credit Facility was amended and restated.  This 
amendment and restatement of the Unsecured Credit Facility provided for: (i) 
an increase in the borrowing limit from $75,000 to $150,000, (ii) a decrease 
in the interest rate spread over LIBOR from 1.7% to 1.4% and (iii) an 
extension of the maturity date to April 3, 2000, from February 26, 1998.  At 
September 30, 1997, the LIBOR rate was 5.69%.  The Company wrote off $808 in 
loan costs in connection with this restructuring.

    On September 23, 1997, the Unsecured Credit Facility was further amended 
and restated to provide for: (i) an increase of the borrowing limit from 
$150,000 to $250,000 and (ii) a decrease in the interest rate spread over 
LIBOR from 1.4% to 1.3%.  The Company paid a fee totaling $250 in connection 
with the amendment.

5.  PROPERTY ACQUISITIONS AND DEVELOPMENTS

    Excluding the Portfolio Acquisition described in Note 6, during the nine 
months ended September 30, 1997, the Company purchased nine properties 
located in California, Georgia, Indiana, New Jersey, Texas and Wisconsin, 
with an aggregate square footage of 1,877,068.  The aggregate purchase price 
for these properties totaled $68,584.  The Company funded a portion of these 
acquisitions from cash reserves and funded the majority of the remaining 
costs with borrowings under its Unsecured Credit Facility.  In addition, the 
Company assumed mortgage notes totaling $16,153.  The Company recorded a 
corresponding premium totaling $324 in connection with these mortgage notes.
     
    At September 30, 1997, the Company had, either directly or through 
consolidated partnerships, eight warehouse/distribution properties under 
development or scheduled for development comprising 2,602,703 square feet 
upon completion.  The aggregate cost for the design and construction of such 
development projects is estimated to be approximately $87,749.  As of 
September 30, 1997, the Company had incurred total project cost of 
approximately $25,204 on these development projects.  The Company anticipates 
funding the balance of such development costs from cash reserves and 
borrowings under the Unsecured Credit Facility.


                                      7
<PAGE>

    In addition, during the nine months ended September 30, 1997, the 
Company, either directly or through consolidated partnerships, completed 
development of and placed in service four warehouse/distribution properties 
comprising 621,960 square feet with an aggregate cost of approximately 
$18,677.  In connection with these development activities, the Company's 
minority joint venture partners contributed land and other consideration 
valued at $4,032.

6.  PORTFOLIO ACQUISITIONS

    On September 30, 1997, the Company acquired from Ameritech Pension Trust 
("Ameritech") in a property-for-stock transaction: (i) eleven 
warehouse/distribution properties comprising 1,521,171 square feet, and (ii) 
a participating mortgage loan secured by a seven building, 623,566 square 
foot project.  The purchase price totaled $81,589, including the 
participating loan which was purchased for $21,500.  The property-for-stock 
transaction involved the issuance of 4,160,745 shares of the Company's Common 
Stock to Ameritech.

    Subsequent to September 30, 1997, the Company acquired eleven additional 
warehouse/distribution properties comprising 1,960,268 square feet funded by 
the issuance of 3,104,477 shares of the Company's common stock to Ameritech. 
The purchase price for this transaction totaled $61,571.

    On September 24, 1997, the Company acquired from The Prudential Insurance 
Company of America and related entities (collectively "Prudential") a 
portfolio of 44 industrial buildings containing an aggregate of approximately 
3,538,000 square feet of rentable space (the "Portfolio Properties").  The 
aggregate contract price for the Portfolio Properties was $127,079 (the 
"Prudential Property Transaction").  The Company also contracted with 
Prudential to purchase five unimproved parcels of land located in California, 
Illinois and Michigan.  The contract price for these parcels of $13,721 was 
deposited into an escrow account.  In the event that the contingencies are 
not cleared to the Company's satisfaction, then the funds in the escrow 
account will be returned to the Company.

    The Company funded the cost of the Prudential transactions from a 
combination of (i) net proceeds from the sale of 7,096,513 shares of the 
Company's common stock to Prudential and three accounts managed by Prudential 
totaling $141,901, and (ii) proceeds from borrowings under its Unsecured 
Credit Facility.

    Concurrent with the closing of the Prudential Property Transaction, eight 
industrial properties located in the metropolitan area of New Orleans, 
Louisiana and five industrial properties located in the metropolitan area of 
Jacksonville, Florida (collectively the "EastGroup Properties") were directly 
conveyed in a simultaneous sale by the Company to EastGroup Properties, L.P. 
("EastGroup") for a total sales price of $49,710.  EastGroup's consideration 
for the EastGroup Properties was cash of $4,710 and $45,000 in fully secured 
promissory notes due on December 31, 1997.  The notes require monthly 
payments of interest only computed on the basis of an annual rate of 9.25%.  
The EastGroup Properties were conveyed at the Company's cost of such 
properties thus resulting in no gain or loss on the transaction.

    The Company entered into agreements to acquire 12 industrial properties 
from two separate accounts managed by Prudential Real Estate Investors.  On 
August 29, 1997, the Company acquired seven of these properties comprising 
825,568 square feet.  The purchase price consisted of the payment of $16,141 
and issuance of 808,888 shares of Common Stock.  On September 24, 1997, the 
Company acquired the remaining five industrial properties comprising 953,691 
square feet.  The purchase price consisted of the payment of $9,349 and 
issuance of 1,106,931 shares of Common Stock.  The total $25,490 cash portion 
of the purchases for these portfolios were funded from borrowings on the 
Company's Unsecured Credit Facility.


                                      8
<PAGE>

7.  PROPERTY DISPOSITIONS

    During the nine months ended September 30, 1997, the Company sold five 
properties for an aggregate sales price of $11,833.  The properties were 
located in Alabama, Texas, California and Arizona.  After closing costs and 
pro-rated items totaling $638 from these transactions, the Company received 
net proceeds aggregating to $11,195.

    As of September 30, 1997, the Company has entered into contracts for sale 
of Phoenix Plaza III and Phoenix North 27th.  The net book value of these 
rental properties held for sale was $2,437 at September 30, 1997.


                                      9
<PAGE>

8.  SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

    The following table reflects supplemental disclosure of cash flow 
transactions for the nine months ended September 30, 1997 and 1996.

<TABLE>
<CAPTION>
                                                                  1997           1996
                                                              ---------      ---------
  <S>                                                         <C>            <C>
  Cash Paid For Interest Expense                              $   7,191      $   3,530

  Merger Transaction:
   Acquisition Cost Allocated to Investment in Real Estate           --        203,489
   Restricted Cash                                                   --          5,551
   Receivables, Net                                                  --          2,889
   Note Receivable from Affiliate                                    --            720
   Capitalized Loan Fees                                             --            992
   Cancellation of Redeemable Series A Preferred Stock               --            960
   Mortgage Loan Assumed                                             --        (66,094)
   Other Long-Term Debts Assumed                                     --        (43,191)
   Accounts Payable Assumed                                          --         (2,869)
   Shares of Common Stock Issued, at Par Value                       --             (8)
   Paid-in Capital                                                   --       (109,842)
   Other Net Liabilities Assumed                                     --         (4,489)

  Asset Purchase Transaction:
   Acquisition Cost Allocated to Investment in Real Estate           --         26,342
   Restricted Cash Applied to Debt Payment                           --            117
   Mortgage Notes Payable Assumed                                    --        (16,334)
   Paid-in Capital of Common Shares Issued                           --         (6,392)
   Accrued Closing Costs and Pro-rated Items                         --           (476)

  Property Acquisitions:
   Acquisition Price                                             69,407         49,073
   Land for Built-to-Suit Facilities                             13,076          2,301
   Deposits Applied to Purchase Price                                --           (300)
   Minority Limited Partners Capital Contributions               (3,863)            --
   Accrued Closing Costs and Pro-rated Items                    (17,087)            --

  Portfolio Acquisitions:
   Acquisition Price                                            304,664             --
   Shares of Common Stock Issued                               (259,817)            --
   Accrued Closing Costs and Pro Rated Items                     31,185             --

  Property Dispositions:
   Net Basis                                                    (61,745)        (7,807)
   Other Assets, Net of Other Liabilities                        45,329            190
</TABLE>


                                      10
<PAGE>

    ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
              CONDITION AND RESULTS OF OPERATIONS
              (DOLLARS IN THOUSANDS, UNLESS INDICATED OTHERWISE)

INTRODUCTION

    The Company is a self-administered and self-managed real estate 
investment trust engaged primarily in the business of owning, acquiring, 
managing, leasing and developing income-producing warehouse/distribution and 
light industrial properties.  At September 30, 1997, the Company's principal 
asset was its portfolio of 127 warehouse/distribution properties, 33 light 
industrial properties and two retail properties.  In addition, at September 
30, 1997, the Company had eight build-to-suit properties under construction.  
As of September 30, 1997 and 1996, the Company's properties were 96% and 94% 
occupied, respectively.

    The following discussion should be read in conjunction with the Company's 
Form 10-K for 1996, the Company's other reports filed by the Company since 
December 31, 1996 under sections 13 or 15(d) of the Securities Act of 1934., 
and the Condensed Consolidated Balance Sheets, Condensed Consolidated 
Statements of Operations and Condensed Consolidated Statements of Cash Flows 
and the notes thereto included in pages 2 through 10 of this report.  Unless 
otherwise defined in this report, or unless the context otherwise requires, 
the capitalized words or phrases used in this section either (i) describe 
accounting terms that are used as line items in such financial statements, or 
(ii) have the meanings ascribed to them in such financial statements and the 
notes thereto.

LIQUIDITY AND CAPITAL RESOURCES

GENERAL

    The Company intends to finance property acquisitions, expansions and 
renovations using a combination of cash flow from operations and debt 
financing, supplemented with private or public debt or equity placements. 
Where intermediate or long-term debt financing is employed, the Company will 
generally seek to obtain fixed interest rates or enter into agreements 
intended to cap the effective interest rate on floating rate debt.

SOURCES OF LIQUIDITY

    The Company's main sources of liquidity are: (i) cash flows from 
operating activities, (ii) cash reserves, (iii) borrowings under its 
Unsecured Credit Facility, (iv) proceeds from private or public equity or 
debt placements, and (v) proceeds from property dispositions.

    Net Cash Provided by Operating Activities totaled $18,548 and $9,284 for 
the nine months ended September 30, 1997 and 1996, respectively. Net Cash 
Used in Investing Activities totaled $155,135 and $40,234 for the nine months 
ended September 30, 1997 and 1996,respectively.  Net Cash Provided by 
Financing Activities totaled $146,367 and $32,097 for the nine months ended 
September 30, 1997 and 1996, respectively.


                                      11
<PAGE>

    In addition to cash flows and net income, management and industry 
analysts generally consider Funds From Operations to be one additional 
measure of the performance of an equity REIT because, together with net 
income and cash flows, Funds From Operations provides investors with an 
additional basis to evaluate the ability of the Company to incur and service 
debt and to fund acquisitions and other capital expenditures.  However, Funds 
From Operations does not measure whether cash flow is sufficient to fund all 
of the Company's cash needs including principal amortization, capital 
improvements and distributions to stockholders.  Funds From Operations also 
does not represent cash generated from operating, investing or financing 
activities as determined in accordance with generally accepted accounting 
principles. Funds From Operations should not be considered as an alternative 
to net income as an indicator of the Company's operating performance or as an 
alternative to cash flow as a measure of liquidity.  The Company calculates 
Funds From Operations in accordance with the White Paper published by NAREIT. 
As defined by NAREIT, Funds From Operations means net income (loss) 
(computed in accordance with generally accepted accounting principles), 
excluding gains (or losses) from debt restructuring and sales of property, 
plus depreciation and amortization, and after adjustment from unconsolidated 
partnerships and joint ventures.  A reconciliation of the Company's income 
before gains or losses on sale of properties and extraordinary item to Funds 
From Operations for the nine months ended September 30, 1997 and 1996 is as 
follows:
     
                                                        NINE MONTHS ENDED
                                                          SEPTEMBER 30,
                                                         1997       1996
                                                       --------   --------
    Income Before Gain (Loss) on Sale
     of Properties and Extraordinary Item              $ 13,832   $  7,778
    Reconciling Item:
     Depreciation and Amortization
      Relating to Real Estate Operations                  6,644      3,209
                                                       --------   --------
    Funds From Operations                              $ 20,476   $ 10,987
                                                       --------   --------
                                                       --------   --------

    As of  September 30, 1997, the Company had $12,722 in unrestricted cash
and cash equivalents.

    At September 30, 1997, the outstanding balance on the Mortgage Loan was 
$66,094. The Mortgage Loan bears interest at the annual rate of 8.63% and 
requires interest only payments until its maturity in 2005.

    During the nine months ended September 30, 1997, the Company borrowed 
$171,000 under its Unsecured Credit Facility to fund property acquisitions 
and developments.  Also, the Company repaid borrowings under the facility 
totaling $4,500. As of September 30, 1997, the Company had borrowings of 
$178,000 outstanding under the Unsecured Credit Facility.

    On April 22, 1997, the Unsecured Credit Facility was amended and 
restated. Under this amendment and restatement of the Unsecured Credit 
Facility: (i) the borrowing limit increased from $75,000 to $150,000, (ii) 
the interest rate spread over LIBOR decreased from 1.7% to 1.4% and (iii) the 
maturity date was extended to April 3, 2000, from February 26, 1998.

    On September 23, 1997, the Unsecured Credit Facility was further amended 
and restated to provide for: (i) an increase of the borrowing limit from 
$150,000 to $250,000 and (ii) a decrease in the interest rate spread over 
LIBOR from 1.4% to 1.3%.

    On May 13, 1997, the Company purchased a property located in Montebello, 
California, subject to a mortgage note and a corresponding premium totaling 
$10,429 and $324, respectively, at acquisition.  The loan has monthly 
principal and interest payments of $96, bears an interest rate of 9.89% per 
annum and matures on July 15, 1998.


                                      12
<PAGE>

    In addition to the variable interest rate contracts on the Unsecured 
Credit Facility, the Company may incur indebtedness in the future that bears 
interest at a variable rate or may be required to refinance its debt at 
higher rates.  As a result, increases in interest rates could increase the 
Company's interest expense, which could adversely affect the Company's 
ability to pay distributions to stockholders.

    During the nine months ended September 30, 1997, the Company sold five 
properties for an aggregate sales price of $11,833.  The properties were 
located in Alabama, Texas, California and Arizona.  After closing costs and 
pro-rated items totaling $638 from these transactions, the Company received 
net proceeds aggregating to $11,195.

    As of September 30, 1997, the Company has entered into contracts for sale 
of Phoenix Plaza III and Phoenix North 27th.  The net book value of these 
rental properties held for sale was $2,437 at September 30, 1997. The net 
proceeds from these sales will be used to reduce the amount outstanding on 
the Unsecured Credit Facility.

    The Company is currently in negotiations with a group of institutional 
lenders for a private debt offering of $160,000 of unsecured senior notes for 
a term of ten to twelve years.  However, there are no assurances that the 
Company will be successful in completing this offering.

USES OF LIQUIDITY

    The Company's principal applications of its cash resources are: (i) 
payment of operating costs including property expenses, property taxes, 
general and administrative expenses, and interest expense, (ii) payments for 
capital improvements and leasing costs, (iii) payment of distributions, (iv) 
principal paydowns on its debt, and (v) funding of property acquisitions and 
developments.

    The Company anticipates during 1997 that it will have sufficient cash 
flows to fund:  (i) its operating needs, (ii) capital improvements on its 
properties, and (iii) the proposed distributions to its common and preferred 
stockholders.  Planned capital improvements on the Company's properties 
consists of tenant improvements and other expenditures necessary to lease and 
maintain the properties.

    On April 29, 1997, the Company assumed a mortgage note totaling $5,724 in 
connection with the acquisition of a property located in Corona, California. 
The loan had monthly principal and interest payments of $55.  On September 
15, 1997, the Company repaid the outstanding balance on this mortgage of 
$5,688.

    During the nine months ended September 30, 1997, the Company declared 
dividends to holders of its Common Stock and Series B Preferred Stock in the 
aggregate amounts of $15,657 and $2,114, respectively, or $0.29 and $0.31 per 
share, respectively.

    Subsequent to September 30, 1997, the Company adopted a plan to 
repurchase up to $10 million of the Company's shares of Common Stock over a 
period of six months which will be funded from cash generated by its 
operating activities.

DEVELOPMENT PROJECTS

    At September 30, 1997, the Company had, either directly or through 
consolidated partnerships, eight warehouse/distribution properties under 
development or scheduled for development comprising 2,602,703 square feet 
upon completion.  The aggregate cost for the design and construction of such 
development projects is estimated to be approximately $87,749.  As of 
September 30, 1997, the Company had incurred total project cost of 
approximately $25,204 on these development projects.  The Company anticipates 
funding the balance of such development costs from cash reserves and 
borrowings under the Unsecured Credit Facility.


                                      13
<PAGE>

    In addition, during the nine months ended September 30, 1997, the 
Company, either directly or through consolidated partnerships, completed 
development of and placed in service four warehouse/distribution properties 
comprising 621,960 square feet with an aggregate cost of approximately 
$18,677.  In connection with these development activities, the Company's 
minority joint venture partners contributed land and other consideration 
valued at $4,032.

    Subsequent to September 30, 1997, the Company, either directly or through 
consolidated partnerships, entered into agreements to develop two 
warehouse/distribution aggregating to 736,900 square feet upon completion.  
The aggregate cost for the design and construction of such development 
projects is estimated to be approximately $28,629.  The Company anticipates 
funding these development costs from cash reserves and borrowings under the 
Unsecured Credit Facility.

PROPERTY AND PORTFOLIO ACQUISITIONS

    During the nine months ended September 30, 1997, the Company purchased 
nine properties located in California, Georgia, Indiana, New Jersey, Texas 
and Wisconsin, with an aggregate square footage of 1,877,068.  The aggregate 
purchase price for these properties totaled $68,584.  The Company funded 
these acquisitions with cash reserves, assumption of two mortgage notes 
aggregating to $16,153, and borrowings under its Unsecured Credit Facility.

    On September 30, 1997, the Company acquired from Ameritech Pension Trust 
("Ameritech") in a property-for-stock transaction: (i) eleven 
warehouse/distribution properties comprising 1,521,171 square feet, and (ii) 
a participating mortgage loan secured by a seven building, 623,566 square 
foot project.  The purchase price totaled $81,589, including the 
participating loan which was purchased for $21,500.  The property-for-stock 
transaction involved the issuance of 4,160,745 shares of the Company's Common 
Stock to Ameritech.

    Subsequent to September 30, 1997, the Company acquired eleven additional 
warehouse/distribution properties comprising 1,960,268 square feet funded by 
the issuance 3,104,477 shares of the Company's common stock to Ameritech.  
The purchase price for this transaction totaled $61,571.

    On September 24, 1997, the Company acquired from Prudential a portfolio 
of 44 industrial buildings containing an aggregate of approximately 3,538,000 
square feet of rentable.  The aggregate contract price for the Portfolio 
Properties was $127,079. The Company also contracted with Prudential to 
purchase five unimproved parcels of land located in California, Illinois and 
Michigan.  The contract price for these parcels of $13,721 was deposited into 
an escrow account.  In the event that the contingencies are not cleared to 
the Company's satisfaction, then the funds in the escrow account will be 
returned to the Company.

    The Company funded the cost of the Prudential Transactions from a 
combination of (i) net proceeds from the sale of 7,096,513 shares of the 
Company's common stock to Prudential and three accounts managed by Prudential 
totaling $141,901, and (ii) proceeds from borrowings under its Unsecured 
Credit Facility.

    Concurrent with the closing of the Prudential Property Transaction, eight 
industrial properties located in the metropolitan area of New Orleans, 
Louisiana and five industrial properties located in the metropolitan area of 
Jacksonville, Florida were directly conveyed in a simultaneous sale by the 
Company to EastGroup for a total sales price of $49,710.  EastGroup's 
consideration for the EastGroup Properties was cash of $4,710 and $45,000 in 
fully secured promissory notes due on December 31, 1997.  The notes require 
monthly payments of interest only computed on the basis of an annual rate of 
9.25%.  The EastGroup Properties were conveyed at the Company's cost of such 
properties thus resulting in no gain or loss on the transaction.


                                      14
<PAGE>

    The Company entered into agreements to acquire 12 industrial properties 
from two separate accounts managed by Prudential Real Estate Investors.  On 
August 29, 1997, the Company acquired seven of these properties comprising 
825,568 square feet.  The purchase price consisted of the payment of $16,141 
and issuance of 808,888 shares of Common Stock.  On September 24, 1997, the 
Company acquired the remaining five industrial properties comprising 953,691 
square feet.  The purchase price consisted of the payment of $9,349 and 
issuance of  1,106,931 shares of Common Stock.  The total $25,490 cash 
portion of the purchases were funded from borrowings on the Company's 
Unsecured Credit Facility.

MATERIAL CHANGES IN RESULTS OF OPERATIONS

    The Company was incorporated on May 18, 1995.  The Merger and Asset 
Purchase were consummated on February 23, 1996.  Prior to the Merger and 
Asset Purchase, the Company had no operating activities other than receiving 
interest on its investments and paying general and administrative expenses.  
In comparison to the operating activities of the Company for 1997, which 
reflect nine full months of operations from January 1, 1997 to September 30, 
1997, the historical results of operations for the nine months ended 
September 30, 1996 reflect the operating activities of the Company from 
February 23, 1996 to September 30, 1996 (the difference between these two 
time periods are referred to as "Short Period Differences").

    Rentals from Real Estate Investments for the nine months ended September 
30, 1997 and 1996 totaled $39,271 and $23,464 respectively.  The increase of 
$15,810 was primarily due to:  (i) the Short Period Differences, (ii) 
properties acquired during 1996 and 1997 ("Property Acquisitions") which 
increased rental revenues by $10,310, and (ii) the rental revenues generated 
by the build-to-suit properties placed in service during 1996 and 1997 
("Completed Build-to-Suits") totaling $3,223.  These increases were partially 
offset by properties disposed of during 1996 and 1997 ("Property 
Dispositions") which reduced rental revenues by $3,945.

    Compared to the same period in 1996, Interest Expense increased by $2,700 
to $6,868 during the nine months ended September 30, 1997.  The increase was 
primarily due to increase levels of borrowings under the Unsecured Credit 
Facility in 1997 as compared to 1996.

    Property Taxes increased by $2,029 to $5,298 during the nine months ended 
September 30, 1997 compared to the same period in 1996.  The increase was 
primarily due to:  (i) the Short Period Differences, (ii) the Property Taxes 
attributable to the Property Acquisitions totaling $1,138, and (iii) the 
Property Taxes for the Completed Build-to-Suits amounting to $483.  These 
increases were partially offset by Property Dispositions which reduced 
Property Taxes by $492.

    Property Operating Costs increased by $804 to $3,288 during the nine 
months ended September 30, 1997 compared to the same period in 1996.  The 
increase was primarily due to:  (i) the Short Period Differences, and (ii) 
the operating costs attributable to the Property Acquisitions totaling $449 
and the operating costs for the Completed Build-to-Suits amounting to $205. 
These increases were partially offset by Property Dispositions, which reduced 
Property Operating Costs by $680.

    General and Administrative expenses totaled $3,914 and $3,000 for the 
nine months ended September 30, 1997 and 1996, respectively.  The increase of 
$914 was primarily due to the Short Period Differences.

    Depreciation and Amortization expense increased by $3,467 to $6,701 
during the nine months ended September 30, 1997 compared to the same period 
in 1996. The increase was primarily due to:  (i) the Short Period 
Differences, (ii) the depreciation costs attributable to the Property 
Acquisitions totaling $2,018 and (iii) the depreciation for the Completed 
Build-to-Suits amounting to $688. These increases


                                      15
<PAGE>

were partially offset by Property Dispositions, which reduced Depreciation 
and Amortization expenses by $441.

    The Net Loss on Sale of Properties totaling $465 for the nine months 
ended September 30, 1997 was attributable to the disposition of the Wildwood 
and Golden Cove properties, which resulted in a total loss of $1,172.  The 
losses were partially offset by gains on the disposition of the Birmingham I, 
Birmingham II and Phoenix North 23rd properties totaling $707.

    The Extraordinary Item totaling $808 for the nine months ended September 
30, 1997 was attributable to the restructuring of the Company's Unsecured 
Credit Facility.  The Extraordinary Item totaling $411 for the nine months 
ended September 30, 1996 was incurred in connection with the retirement of 
debt assumed in connection with the Merger and Asset Purchase.

RISKS AND UNCERTAINTIES ASSOCIATED WITH FORWARD LOOKING STATEMENTS

    This report contains statements which constitute forward looking 
statements within the meaning of Section 27A of the Securities Act of 1933, 
as amended (the "Securities Act"), and Section 21E of the Securities Exchange 
Act of 1934, as amended (the "Exchange Act").  Those statements appear in a 
number of places in this report and include statements regarding the intent, 
belief or current expectations of the Company, its directors or its officers 
with respect to, among other things: (i) potential acquisitions or property 
developments by the Company; (ii) the Company's financing plans; (iii) trends 
affecting the Company's financial condition or results of operations; (iv) 
the Company's growth strategy, operating strategy and financing strategy; (v) 
the declaration and payment of dividends; and (vi) regulatory matters 
affecting the Company. Such forward looking statements are not guarantees of 
future performance and involve risks and uncertainties, and that actual 
results may differ materially from those projected in the forward looking 
statements as a result of various factors.  Risks and uncertainties 
associated with the Company's acquisition and development activities include 
risks that: acquisition opportunities explored by the Company may be 
abandoned, investments will fail to perform in accordance with expectations 
and that analysis with respect to the cost of improvements to bring an 
acquired project up to standards or to complete a development project will 
prove inaccurate, as well as general investment risks associated with any new 
real estate investment.  The Company disclaims any obligation to update the 
forward looking statements in this report.


                                      16
<PAGE>

--------------------------------------------------------------------------------
                           PART II:  OTHER INFORMATION
--------------------------------------------------------------------------------

    ITEM 1.   LEGAL PROCEEDINGS

    There are no material pending legal proceedings to which the Company or
    any partnership in which the Company has an interest is a party or to
    which any of the assets of the Company or any such partnership is subject.


    ITEM 2.   CHANGES IN SECURITIES

    A provision in the Company's Amended and Restated Employee and Director
    Incentive Stock Plan allows directors to elect to receive all or a portion
    of their annual director fees in Company Common Stock rather than in cash.
    Pursuant to this provision, the Company on July 1, 1997, issued 811 shares
    of its Common Stock to directors who so elected.  There shares were valued
    at $23.31 per share for purposes of this issuance.  The Company issued
    these shares in reliance on a exemption from registration under section
    4(2) of the Securities Act of 1933.
    
    On August 29, 1997, the Company issued 808,888 shares of common stock to
    The Prudential Insurance Company of America on behalf of one insurance
    company separate account. The Company issued these shares and paid
    $16,141,000 in cash in return for title to seven industrial properties
    comprising 825,568 square feet.
    
    On September 24, 1997, the Company issued an additional 1,106,931 shares
    of common stock to The Prudential Insurance Company of America on behalf
    of one insurance company separate account.  The Company issues these
    shares and paid $9,349,000 in cash in return for title to five industrial
    properties comprising 953,691 square feet.
    
    On September 24, 1997, the Company also issued shares of common stock to
    the following entities in the indicated amounts: (i)  5,575,831 shares to
    The Prudential Insurance Company of America on behalf of two other
    insurance company separate accounts, (ii) 1,013,788 shares to Strategic
    Performance Fund - II, Inc., and (iii) 506,894 shares to The Prudential
    Variable Contract Real Property Partnership.  In return, the Company
    received total cash consideration of $141,901,000.
    
    On September 30, 1997, the Company issued 4,160,745 shares of common stock
    to Ameritech Pension Trust in return for (i) eleven industrial properties 
    comprising 1,521,171 square feet, and  (ii) the lender's interest in a loan
    in the original principal sum of $21,500,000 secured by a seven building, 
    623,566 square foot project.
    
    Each of the transactions described in the preceding four paragraphs was
    exempt from the registration requirements of the Securities Act of 1933
    pursuant to Section 4(2) of the Securities Act of 1933 and Regulation 506
    thereunder.


    ITEM 3.   DEFAULTS UPON SENIOR SECURITIES

    None.


                                      17
<PAGE>

    ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
    
    The Company held a special meeting of its stockholders on September 24,
    1997.  At that meeting the stockholders voted on and approved the
    following proposals:

    1.   The issuance of up to 7,546,902 shares of common stock to Ameritech
    Pension Trust

    2.   The issuance of 7,096,513 shares of common stock to The Prudential
      Insurance Company of America and three of its separate accounts

    The stockholders approved these proposals by the following votes:
    
                    Proposal                      For        Against     Abstain
                    --------                      ---        -------     -------
         Issuance of shares to Ameritech       10,536,189    151,394     63,178

         Issuance of shares to Prudential      10,527,753    157,094     65,914
     

    ITEM 5.   OTHER INFORMATION

    None.


    ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

    (A)  Exhibits:

    NO.                 DESCRIPTION
    ---                 -----------
    3.1  (1)  The Company's Second Amended and Restated Bylaws.

    3.2  (1)  Amendment to Second Amended and Restated Bylaws adopted January
              26, 1996.

    3.3  (1)  Second Amendment to Second Amended and Restated Bylaws adopted
              September 17, 1997.

    10.1 (1)  Third Amended and Restated Revolving Credit Agreement dated
              September 23, 1997, among (i) the Company, (ii) BankBoston, N.A.,
              Texas Commerce Bank National Association, NationsBank of Texas, 
              N.A., Wells Fargo Bank, N.A., Dresdner Bank AG, First American 
              Bank Texas, S.S.B., (collectively, the "Banks"), (iii) BankBoston,
              N.A. as Agent for the Banks, (iv) Texas Commerce Bank National 
              Association as Documentation Agent for the Banks, and (v) 
              NationsBank of Texas, N.A. as Syndication Agent for the Banks.

    10.2 (1)  Second Amended and Restated Guaranty of Payment and Performance
              dated September 23, 1997 executed by MIT Unsecured L.P.

    10.3 (1)  MIT-Investor Excepted Holder Agreement dated September 24, 1997
              between the Company and The Prudential Insurance Company of 
              America.


                                      18
<PAGE>

    10.4 (2)  Registration Rights Agreement dated September 24, 1997, among
              the Company, The Prudential Insurance Company of America, The
              Prudential Insurance Company of America on behalf of a single 
              client insurance company separate account contained in Group 
              Annuity Contract No. GA-9032, Strategic Performance Fund - II, 
              Inc., and The Prudential Variable Contract Real Property 
              Partnership.

    10.5 (3)  Amended and Restated Registration Rights Agreement dated
              September 24, 1997, among the Company, The Prudential Insurance
              Company of America acting for the benefit of the Chevron Separate
              Account, and , The Prudential Insurance Company of America acting 
              for the benefit of the Strategic Performance Fund I Separate 
              Account.

    10.6 (4)  Registration Rights Agreement dated September 30, 1997 between
              the Company and Ameritech Pension Trust.

    10.7 (5)  MIT-Ameritech Amended and Restated Excepted Holder Agreement
              dated September 30, 1997, between the Company and Ameritech 
              Pension Trust.

    10.8 (6)  Summary of the Purchase and Sale Agreement (Michigan, Louisiana,
              and Virginia) between The Prudential Insurance Company of America 
              and the Company dated May 29, 1997, together with the First 
              Amendment thereto dated July 7, 1997, the Second Amendment thereto
              dated July 22, 1997,and the Third Amendment thereto dated
              August 5, 1997.

    10.9 (7)  Fourth Amendment to Purchase and Sale Agreement (Michigan, 
              Louisiana, and Virginia) between The Prudential Insurance Company 
              of America and the Company dated August 20, 1997, Fifth Amendment 
              to Purchase and Sale Agreement (Michigan, Louisiana, and Virginia)
              between The Prudential Insurance Company of America and the 
              Company dated September 5, 1997, and Sixth Amendment to Purchase 
              and Sale Agreement (Michigan, Louisiana, and Virginia) between 
              The Prudential Insurance Company of America and the Company dated 
              September 8, 1997.

27.1 (1)  Financial data schedule.


    (1)  Filed with this report
    (2)  Incorporated by reference to Exhibit VIII to the Schedule 13D filed on
         October 3, 1997 by The Prudential Insurance Company of America, 
         Strategic Performance Fund - II, Inc., and The Prudential Variable 
         Contract Real Property Partnership
    (3)  Incorporated by reference to Exhibit IX to the Schedule 13D filed on
         October 3, 1997 by The Prudential Insurance Company of America, 
         Strategic Performance Fund - II, Inc., and The Prudential Variable 
         Contract Real Property Partnership
    (4)  Incorporated by reference to Exhibit G to the Amendment No. 1 to
         Schedule 13D filed on October 10, 1997 by Ameritech Pension Trust
    (5)  Incorporated by reference to Exhibit H to the Amendment No. 1 to
         Schedule 13D filed on October 10, 1997 by Ameritech Pension Trust
    (6)  Incorporated by reference to Exhibit 10.5 to the Company's Form 10Q
         for the second quarter of 1997
    (7)  Incorporated by reference to Exhibit 10.8 to the Company's Form 8-K
         filed October 9, 1997

    (b)  Reports on Form 8-K:  No Form 8-K reports were filed during the
         quarter ended September 30, 1997.


                                      19
<PAGE>

                                  SIGNATURES

    Pursuant to the requirements of the Securities Exchange Act of 1934, the 
registrant has duly caused this report to be signed on its behalf by the 
undersigned thereunto duly authorized.

                                       MERIDIAN INDUSTRIAL TRUST, INC.




Dated:  November 14, 1997              By:  /s/ Allen J. Anderson
                                          -------------------------------------
                                          Allen J. Anderson
                                          Chairman and Chief Executive Officer
                                          (Principal Executive Officer)



Dated:  November 14, 1997              By:  /s/ Milton K. Reeder
                                          -------------------------------------
                                          Milton K. Reeder
                                          President and Chief Financial Officer
                                          (Principal Financial Officer)


                                      20
<PAGE>

                        MERIDIAN INDUSTRIAL TRUST, INC.
                               INDEX TO EXHIBITS

<TABLE>
<CAPTION>

   Exhibit Number
(corresponding to the                                                                    Sequentially
Exhibit Table of Item                                                                      Numbered
601 of Regulation S-K)                           Description                                 Page
----------------------                           -----------                                 ----
<S>                     <C>                                                              <C>

       3.1              The Company's Second Amended and Restated Bylaws.

       3.2              Amendment to Second Amended and Restated Bylaws adopted 
                        January 26, 1996.

       3.3              Second Amendment to Second Amended and Restated Bylaws 
                        adopted September 17, 1997.

       10.1             Third Amended and Restated Revolving Credit Agreement dated 
                        September 23, 1997, among (i) the Company, (ii) BankBoston, 
                        N.A., Texas Commerce Bank National Association, NationsBank 
                        of Texas, N.A., Wells Fargo Bank, N.A., Dresdner Bank AG, 
                        First American Bank Texas, S.S.B., (collectively, the "Banks"),
                        (iii) BankBoston, N.A. as Agent for the Banks, (iv) Texas 
                        Commerce Bank National Association as Documentation Agent for 
                        the Banks, and (v) NationsBank of Texas, N.A. as Syndication 
                        Agent for the Banks.

       10.2             Second Amended and Restated Guaranty of Payment and Performance
                        dated September 23, 1997 executed by MIT Unsecured L.P.

       10.3             MIT-Investor Excepted Holder Agreement dated September 24, 1997
                        between the Company and The Prudential Insurance Company of
                        America.

       27.1             Financial data schedule
</TABLE>


                                      21