##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 Form 10-Q
 QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2007.
 Commission File Number: 1-32261
 
 BIOMED REALTY TRUST, INC.
 (Exact name of registrant as specified in its charter)
 Maryland
    
    20-1142292(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)17140 Bernardo Center Drive, Suite 222San Diego, California
    
    92128(Address of Principal Executive Offices)
    
    (Zip Code)
 (858) 485-9840
 (Registrants telephone number, including area code)
 þ o
  þ o o
 o þ




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##### 



BIOMED REALTY TRUST, INC.
 FORM 10-Q  QUARTERLY REPORT
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2007
TABLE OF CONTENTS
 PagePART I  FINANCIAL INFORMATIONItem 1
    
    Consolidated Financial Statements
    
    
    3Consolidated Balance Sheets as of June 30, 2007 (Unaudited) and December 31, 2006
    
    
    3Consolidated Statements of Income for the three and six months ended June 30, 2007 and 2006 (Unaudited)
    
    
    4Consolidated Statements of Cash Flows for the six months ended June 30, 2007 and 2006 (Unaudited)
    
    
    5Notes to Consolidated Financial Statements (Unaudited)
    
    
    7Item 2
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    22Item 3
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    31Item 4
    
    Controls and Procedures
    
    
    32PART II  OTHER INFORMATIONItem 1
    
    Legal Proceedings
    
    
    33Item 1A
    
    Risk Factors
    
    
    33Item 2
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    33Item 3
    
    Defaults Upon Senior Securities
    
    
    33Item 4
    
    Submission of Matters to a Vote of Security Holders
    
    
    33Item 5
    
    Other Information
    
    
    33Item 6
    
    Exhibits
    
    
    34SIGNATURES
    
    
    35EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1
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##### Table of Contents



PART 1  FINANCIAL INFORMATION
 
 ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
 BIOMED REALTY TRUST, INC.
 
 CONSOLIDATED BALANCE SHEETS
 (In thousands, except share data)
 June 30, 2007
    
    
    December 31, 2006(Unaudited)ASSETSInvestments in real estate, net
    
    $
    2,618,590
    
    
    $
    2,457,538Investment in unconsolidated partnerships
    
    
    20,425
    
    
    
    2,436Cash and cash equivalents
    
    
    20,382
    
    
    
    25,664Restricted cash
    
    
    9,203
    
    
    
    6,426Accounts receivable, net of allowance for doubtful
accounts of $1,671 and $1,240 as of June 30, 2007 and
December 31, 2006, respectively
    
    
    3,952
    
    
    
    5,985Accrued straight-line rents, net
    
    
    27,842
    
    
    
    20,446Acquired above-market leases, net
    
    
    6,933
    
    
    
    7,551Deferred leasing costs, net
    
    
    121,308
    
    
    
    129,322Deferred loan costs, net
    
    
    15,132
    
    
    
    17,608Prepaid expenses
    
    
    1,633
    
    
    
    3,627Other assets
    
    
    49,581
    
    
    
    16,039Total assets
    
    $
    2,894,981
    
    
    $
    2,692,642LIABILITIES AND STOCKHOLDERS EQUITYMortgage notes payable, net
    
    $
    399,522
    
    
    $
    403,836Secured construction loan
    
    
    356,071
    
    
    
    286,355Secured term loan
    
    
    250,000
    
    
    
    250,000Exchangeable senior notes
    
    
    175,000
    
    
    
    175,000Unsecured line of credit
    
    
    132,150
    
    
    
    228,165Security deposits
    
    
    6,883
    
    
    
    7,704Dividends and distributions payable
    
    
    25,509
    
    
    
    19,847Accounts payable, accrued expenses, and other liabilities
    
    
    58,588
    
    
    
    62,602Acquired below-market leases, net
    
    
    24,910
    
    
    
    25,101Total liabilities
    
    
    1,428,633
    
    
    
    1,458,610Minority interests
    
    
    18,873
    
    
    
    19,319Stockholders equity:Preferred stock, $.01 par value, 15,000,000 shares
authorized: 7.375% Series A cumulative redeemable
preferred stock, $230,000,000 liquidation preference
($25.00 per share), 9,200,000 shares issued and
outstanding at June 30, 2007
    
    
    222,413
    
    
    
    Common stock, $.01 par value, 100,000,000 shares
authorized, 65,462,839 and 65,425,598 shares issued and
outstanding at June 30, 2007 and December 31, 2006,
respectively
    
    
    655
    
    
    
    654Additional paid-in capital
    
    
    1,274,820
    
    
    
    1,272,243Accumulated other comprehensive income
    
    
    26,551
    
    
    
    8,417Dividends in excess of earnings
    
    
    (76,964
    )
    
    
    (66,601
    )Total stockholders equity
    
    
    1,447,475
    
    
    
    1,214,713Total liabilities and stockholders equity
    
    $
    2,894,981
    
    
    $
    2,692,642
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BIOMED REALTY TRUST, INC.
 
 CONSOLIDATED STATEMENTS OF INCOME
 (In thousands, except per share data)
 For the Three Months
    
    
    For the Six MonthsEnded June 30,
    
    
    Ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006(Unaudited)Revenues:Rental
    
    $
    49,460
    
    
    $
    35,995
    
    
    $
    96,969
    
    
    $
    66,611Tenant recoveries
    
    
    15,670
    
    
    
    12,731
    
    
    
    32,180
    
    
    
    25,238Other income
    
    
    3,299
    
    
    
    64
    
    
    
    8,078
    
    
    
    70Total revenues
    
    
    68,429
    
    
    
    48,790
    
    
    
    137,227
    
    
    
    91,919Expenses:Rental operations
    
    
    12,880
    
    
    
    9,547
    
    
    
    25,995
    
    
    
    19,000Real estate taxes
    
    
    5,543
    
    
    
    4,536
    
    
    
    11,459
    
    
    
    8,727Depreciation and amortization
    
    
    19,637
    
    
    
    14,577
    
    
    
    36,891
    
    
    
    27,802General and administrative
    
    
    5,364
    
    
    
    4,206
    
    
    
    10,707
    
    
    
    8,553Total expenses
    
    
    43,424
    
    
    
    32,866
    
    
    
    85,052
    
    
    
    64,082Income from operations
    
    
    25,005
    
    
    
    15,924
    
    
    
    52,175
    
    
    
    27,837Equity in net (loss)/income of unconsolidated partnerships
    
    
    (454
    )
    
    
    22
    
    
    
    (432
    )
    
    
    42Interest income
    
    
    339
    
    
    
    435
    
    
    
    570
    
    
    
    595Interest expense
    
    
    (7,117
    )
    
    
    (9,253
    )
    
    
    (13,969
    )
    
    
    (17,037
    )Income from continuing operations before minority
interests
    
    
    17,773
    
    
    
    7,128
    
    
    
    38,344
    
    
    
    11,437Minority interests in continuing operations of
consolidated partnerships
    
    
    (113
    )
    
    
    46
    
    
    
    (113
    )
    
    
    100Minority interests in continuing operations of operating
partnership
    
    
    (577
    )
    
    
    (381
    )
    
    
    (1,276
    )
    
    
    (635
    )Income from continuing operations
    
    
    17,083
    
    
    
    6,793
    
    
    
    36,955
    
    
    
    10,902Income from discontinued operations before gain on sale
of assets and minority interests
    
    
    252
    
    
    
    386
    
    
    
    639
    
    
    
    773Gain on sale of real estate assets
    
    
    1,088
    
    
    
    
    
    
    
    1,088
    
    
    
    Minority interests attributable to discontinued operations
    
    
    (57
    )
    
    
    (21
    )
    
    
    (74
    )
    
    
    (43
    )Income from discontinued operations
    
    
    1,283
    
    
    
    365
    
    
    
    1,653
    
    
    
    730Net income
    
    
    18,366
    
    
    
    7,158
    
    
    
    38,608
    
    
    
    11,632Preferred stock dividends
    
    
    (4,194
    )
    
    
    
    
    
    
    (8,387
    )
    
    
    Net income available to common stockholders
    
    $
    14,172
    
    
    $
    7,158
    
    
    $
    30,221
    
    
    $
    11,632Income from continuing operations per share available to common
stockholders:Basic and diluted earnings per share
    
    $
    0.20
    
    
    $
    0.13
    
    
    $
    0.44
    
    
    $
    0.22Net income per share available to common stockholders:Basic and diluted earnings per share
    
    $
    0.22
    
    
    $
    0.14
    
    
    $
    0.46
    
    
    $
    0.24Weighted-average common shares outstanding:Basic
    
    
    65,298,747
    
    
    
    51,394,117
    
    
    
    65,294,411
    
    
    
    48,895,318Diluted
    
    
    68,269,656
    
    
    
    54,534,393
    
    
    
    68,258,562
    
    
    
    52,062,831
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BIOMED REALTY TRUST, INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
 Six Months EndedJune 30,2007
    
    
    2006(Unaudited)Operating activities:Net income
    
    $
    38,608
    
    
    $
    11,632Adjustments to reconcile net income to net cash provided by operating activities:Gain on sale of real estate assets
    
    
    (1,088
    )
    
    
    Depreciation and amortization, including amounts for discontinued operations
    
    
    37,118
    
    
    
    28,075Minority interests in consolidated partnerships
    
    
    113
    
    
    
    (100
    )Minority interests in operating partnership and discontinued operations
    
    
    1,350
    
    
    
    678Bad debt expense
    
    
    309
    
    
    
    53Revenue reduction attributable to acquired above-market leases
    
    
    1,262
    
    
    
    1,220Revenue recognized related to acquired below-market leases
    
    
    (2,882
    )
    
    
    (2,371
    )Compensation expense related to restricted common stock and LTIP units
    
    
    2,578
    
    
    
    1,811Amortization of deferred loan costs
    
    
    1,293
    
    
    
    719Amortization of debt premium on mortgage notes payable
    
    
    (437
    )
    
    
    (1,220
    )Loss/(income) from unconsolidated partnerships
    
    
    432
    
    
    
    (42
    )Distributions received from unconsolidated partnerships
    
    
    29
    
    
    
    71Distributions to minority interest in consolidated partnerships
    
    
    (73
    )
    
    
    Changes in operating assets and liabilities:Restricted cash
    
    
    (2,777
    )
    
    
    238Accounts receivable
    
    
    1,724
    
    
    
    6,916Accrued straight-line rents
    
    
    (7,396
    )
    
    
    (4,124
    )Deferred leasing costs
    
    
    (4,441
    )
    
    
    (1,197
    )Prepaid expenses
    
    
    1,994
    
    
    
    (198
    )Other assets
    
    
    (2,817
    )
    
    
    118Security deposits
    
    
    (821
    )
    
    
    61Accounts payable, accrued expenses and other liabilities
    
    
    (13,006
    )
    
    
    2,407Net cash provided by operating activities
    
    
    51,072
    
    
    
    44,747Investing activities:Purchases of interests in and additions to investments in real estate and related intangible assets
    
    
    (192,832
    )
    
    
    (478,515
    )Purchases of interests in unconsolidated partnerships
    
    
    (18,450
    )
    
    
    Proceeds from sale of real estate assets, net of selling costs
    
    
    19,690
    
    
    
    Minority interest investment in consolidated partnerships
    
    
    205
    
    
    
    316Receipts of master lease payments
    
    
    464
    
    
    
    454Security deposits received from prior owners of rental property
    
    
    
    
    
    
    298Additions to non-real estate assets
    
    
    (472
    )
    
    
    (711
    )Funds held in escrow for acquisitions
    
    
    (12,249
    )
    
    
    (11,810
    )Net cash used in investing activities
    
    
    (203,644
    )
    
    
    (489,968
    )Financing activities:Proceeds from common stock offering
    
    
    
    
    
    
    298,999Proceeds from preferred stock offering
    
    
    230,000
    
    
    
    Payment of common stock offering costs
    
    
    
    
    
    
    (12,397
    )Payment of preferred stock offering costs
    
    
    (7,587
    )
    
    
    Payment of deferred loan costs
    
    
    (515
    )
    
    
    (2,026
    )Unsecured line of credit proceeds
    
    
    147,440
    
    
    
    82,030Unsecured line of credit repayments
    
    
    (243,455
    )
    
    
    (38,230
    )Secured bridge loan proceeds
    
    
    
    
    
    
    150,000Principal payments on mortgage notes payable
    
    
    (3,020
    )
    
    
    (2,612
    )Secured construction loan proceeds
    
    
    69,716
    
    
    
    Tenant improvement loan repayments
    
    
    60
    
    
    
    Distributions to operating partnership unit and LTIP unit holders
    
    
    (1,892
    )
    
    
    (1,603
    )Dividends paid to common stockholders
    
    
    (39,264
    )
    
    
    (26,159
    )Dividends paid to preferred stockholders
    
    
    (4,193
    )
    
    
    Net cash provided by financing activities
    
    
    147,290
    
    
    
    448,002Net (decrease)/increase in cash and cash equivalents
    
    
    (5,282
    )
    
    
    2,781Cash and cash equivalents at beginning of period
    
    
    25,664
    
    
    
    20,312Cash and cash equivalents at end of period
    
    $
    20,382
    
    
    $
    23,093
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Six Months EndedJune 30,2007
    
    
    2006(Unaudited)Supplemental disclosure of cash flow information:Cash paid during the period for interest (net of amounts capitalized
of $25,739 and $571, respectively)
    
    $
    13,875
    
    
    $
    16,585Supplemental disclosure of non-cash investing and financing activities:Accrual for preferred stock dividends declared
    
    $
    4,194
    
    
    $
    Accrual for common stock dividends declared
    
    
    20,292
    
    
    
    16,596Accrual for distributions declared for operating partnership unit and LTIP unit holders
    
    
    1,023
    
    
    
    830Mortgage loans assumed (includes premium of $236)
    
    
    
    
    
    
    2,001Accrued additions to real estate and related intangible assets
    
    
    36,995
    
    
    
    2,648
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BIOMED REALTY TRUST, INC.
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 (Unaudited)
 1. Organization and Description of Business
  2. Basis of Presentation and Summary of Significant Accounting Policies
  Principles of Consolidation
  Investments in Partnerships
 Consolidation of Variable Interest Entities Consolidated Financial Statements
 Determining Whether a General Partner, or the General Partners as a Group, Controls a Limited
Partnership or Similar Entity When the Limited Partners Have Certain Rights
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Investments in Real Estate
  June 30, 2007
    
    
    December 31, 2006Land
    
    $
    276,965
    
    
    $
    270,286Ground lease
    
    
    14,210
    
    
    
    14,210Land under development
    
    
    100,392
    
    
    
    85,362Buildings and improvements
    
    
    1,645,538
    
    
    
    1,598,384Construction in progress
    
    
    605,359
    
    
    
    497,971Tenant improvements
    
    
    58,480
    
    
    
    51,9042,700,944
    
    
    
    2,518,117Accumulated depreciation
    
    
    (82,354
    )
    
    
    (60,579
    )$
    2,618,590
    
    
    $
    2,457,538
  Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed
  Deferred Leasing Costs
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Balance atJune 30,
    
    
    Accumulated2007
    
    
    Amortization
    
    
    NetAcquired in-place leases
    
    $
    166,155
    
    
    $
    (60,211
    )
    
    $
    105,944Acquired management agreements
    
    
    12,803
    
    
    
    (5,619
    )
    
    
    7,184Deferred leasing and other direct costs
    
    
    9,235
    
    
    
    (1,055
    )
    
    
    8,180$
    188,193
    
    
    $
    (66,885
    )
    
    $
    121,308
  Balance atDecember 31,
    
    
    Accumulated2006
    
    
    Amortization
    
    
    NetAcquired in-place leases
    
    $
    162,935
    
    
    $
    (47,066
    )
    
    $
    115,869Acquired management agreements
    
    
    12,601
    
    
    
    (4,574
    )
    
    
    8,027Deferred leasing and other direct costs
    
    
    6,122
    
    
    
    (696
    )
    
    
    5,426$
    181,658
    
    
    $
    (52,336
    )
    
    $
    129,322
 Revenue Recognition
  
    
    whether the lease stipulates how and on what a tenant improvement allowance may be spent;
    
    whether the tenant or landlord retain legal title to the improvements;
    
    the uniqueness of the improvements;
    
    the expected economic life of the tenant improvements relative to the length of the lease;
    
    the responsible party for construction cost overruns; and
    
    who constructs or directs the construction of the improvements.
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June 30,
    
    
    December 31,2007
    
    
    2006Acquired above-market leases
    
    $
    12,728
    
    
    $
    12,084Accumulated amortization
    
    
    (5,795
    )
    
    
    (4,533
    )$
    6,933
    
    
    $
    7,551
  June 30,
    
    
    December 31,2007
    
    
    2006Acquired below-market leases
    
    $
    36,186
    
    
    $
    33,495Accumulated amortization
    
    
    (11,276
    )
    
    
    (8,394
    )$
    24,910
    
    
    $
    25,101
 Reporting Revenue Gross as a Principal versus Net as an
Agent
  Incentive Awards
 Share-Based
Payment
 10




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Derivative Instruments
     Managements Estimates
   Reclassifications
  3. Minority Interests
  11




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June 30, 2007
    
    
    December 31, 2006Partnership units
    
    
    Percentage of
    
    
    Partnership units
    
    
    Percentage ofand LTIP units
    
    
    total
    
    
    and LTIP units
    
    
    totalBioMed Realty Trust
    
    
    65,308,702
    
    
    
    95.7
    %
    
    
    65,151,884
    
    
    
    95.8
    %Minority interest consisting of:Partnership and LTIP units held by
employees and related parties
    
    
    2,726,172
    
    
    
    4.0
    %
    
    
    2,673,172
    
    
    
    3.9
    %Partnership units held by third parties
    
    
    190,392
    
    
    
    0.3
    %
    
    
    190,392
    
    
    
    0.3
    %Total
    
    
    68,225,266
    
    
    
    100.0
    %
    
    
    68,015,448
    
    
    
    100.0
    %
  4. Stockholders Equity
   Common Stock, Partnership Units and LTIP Units
  7.375% Series A Cumulative Redeemable Preferred Stock
  12




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Dividends and Distributions
 Dividend and
    
    Dividend andDistribution
    
    Distribution AmountDeclaration Date
    
    Share Class
    
    Amount Per Share
    
    Period Covered
    
    Payable Date
    
    (in thousands)March 15, 2007
    
    Common stock and 
operating
partnership and 
LTIP units
    
    $
    0.31000
    
    
    January 1, 2007 to 
March 31, 2007
    
    April 16, 2007
    
    $
    21,309March 15, 2007
    
    Series A preferred 
stock
    
    $
    0.45582
    
    
    January 18, 2007 to 
April 16, 2007
    
    April 16, 2007
    
    $
    4,193June 15, 2007
    
    Common stock and 
operating
partnership and
LTIP units
    
    $
    0.31000
    
    
    April 1, 2007 to 
June 30, 2007
    
    July 16, 2007
    
    $
    21,315June 15, 2007
    
    Series A preferred
stock
    
    $
    0.45582
    
    
    April 17, 2007 to 
July 15, 2007
    
    July 16, 2007
    
    $
    4,194
 Total 2007 dividends and distributions declared through June 30, 2007:Common stock, operating partnership units, and LTIP units
    
    $
    42,624Series A preferred stock
    
    
    8,387$
    51,011
 Accumulated Other Comprehensive Income
  Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Net income available to common stockholders
    
    $
    14,172
    
    
    $
    7,158
    
    
    $
    30,221
    
    
    $
    11,632Unrealized gain on interest rate swap agreements
    
    
    18,265
    
    
    
    2,390
    
    
    
    18,134
    
    
    
    5,724Comprehensive income
    
    $
    32,437
    
    
    $
    9,548
    
    
    $
    48,355
    
    
    $
    17,356
 5. Mortgage Notes Payable
  Stated Fixed
    
    
    Effective
    
    
    Principal BalanceInterest
    
    
    Interest
    
    
    June 30,
    
    
    December 31,Rate
    
    
    Rate
    
    
    2007
    
    
    2006
    
    
    Maturity DateArdentech Court
    
    
    7.25
    %
    
    
    5.06
    %
    
    $
    4,612
    
    
    $
    4,658
    
    
    July 1, 2012Bayshore Boulevard
    
    
    4.55
    %
    
    
    4.55
    %
    
    
    15,535
    
    
    
    15,730
    
    
    January 1, 2010Bridgeview Technology Park I
    
    
    8.07
    %
    
    
    5.04
    %
    
    
    11,566
    
    
    
    11,625
    
    
    January 1, 2011Eisenhower Road
    
    
    5.80
    %
    
    
    4.63
    %
    
    
    2,134
    
    
    
    2,164
    
    
    May 5, 2008Elliott Avenue
    
    
    7.38
    %
    
    
    4.63
    %
    
    
    15,752
    
    
    
    16,020
    
    
    November 24, 200740 Erie Street
    
    
    7.34
    %
    
    
    4.90
    %
    
    
    18,160
    
    
    
    18,676
    
    
    August 1, 2008500 Kendall Street (Kendall D)
    
    
    6.38
    %
    
    
    5.45
    %
    
    
    70,212
    
    
    
    70,963
    
    
    December 1, 2018Lucent Drive
    
    
    5.50
    %
    
    
    5.50
    %
    
    
    5,639
    
    
    
    5,733
    
    
    January 21, 2015Monte Villa Parkway
    
    
    4.55
    %
    
    
    4.55
    %
    
    
    9,457
    
    
    
    9,576
    
    
    January 1, 20106828 Nancy Ridge Drive
    
    
    7.15
    %
    
    
    5.38
    %
    
    
    6,829
    
    
    
    6,872
    
    
    September 1, 2012Road to the Cure
    
    
    6.70
    %
    
    
    5.78
    %
    
    
    15,535
    
    
    
    15,657
    
    
    January 31, 2014Science Center Drive
    
    
    7.65
    %
    
    
    5.04
    %
    
    
    11,372
    
    
    
    11,444
    
    
    July 1, 2011Shady Grove Road
    
    
    5.97
    %
    
    
    5.97
    %
    
    
    147,000
    
    
    
    147,000
    
    
    September 1, 2016Sidney Street
    
    
    7.23
    %
    
    
    5.11
    %
    
    
    30,366
    
    
    
    30,732
    
    
    June 1, 20129885 Towne Centre Drive
    
    
    4.55
    %
    
    
    4.55
    %
    
    
    21,601
    
    
    
    21,872
    
    
    January 1, 2010900 Uniqema Boulevard
    
    
    8.61
    %
    
    
    5.61
    %
    
    
    1,580
    
    
    
    1,648
    
    
    May 1, 2015387,350
    
    
    
    390,370Unamortized premiums
    
    
    
    
    
    
    
    
    
    
    12,172
    
    
    
    13,466$
    399,522
    
    
    $
    403,836
  13




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##### Table of Contents



6. Credit Facilities, Exchangeable Notes, and Other Debt Instruments
 Unsecured Line of Credit
  Secured Term Loan
   Exchangeable Senior Notes
  14




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##### Table of Contents



Secured Construction Loan
   2007
    
    $
    18,5562008
    
    
    24,4552009
    
    
    493,2472010
    
    
    297,4452011
    
    
    26,220Thereafter
    
    
    440,648$
    1,300,571
 7. Earnings Per Share
  Earnings per Share
 For the Three Months Ended
    
    
    For the Six Months EndedJune 30,
    
    
    June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Adjusted net income available for common stockholders:Income from continuing operations
    
    $
    17,083
    
    
    $
    6,793
    
    
    $
    36,955
    
    
    $
    10,902Preferred dividends
    
    
    (4,194
    )
    
    
    
    
    
    
    (8,387
    )
    
    
    Income from continuing operations available for common
stockholders
    
    
    12,889
    
    
    
    6,793
    
    
    
    28,568
    
    
    
    10,902Income from discontinued operations
    
    
    1,283
    
    
    
    365
    
    
    
    1,653
    
    
    
    730Net income available to common stockholders
    
    
    14,172
    
    
    
    7,158
    
    
    
    30,221
    
    
    
    11,632Minority interests in continuing operations of operating
partnership
    
    
    577
    
    
    
    381
    
    
    
    1,276
    
    
    
    635Minority interests attributable to discontinued operations
    
    
    57
    
    
    
    21
    
    
    
    74
    
    
    
    43Net income available to common stockholders before minority
interests
    
    $
    14,806
    
    
    $
    7,560
    
    
    $
    31,571
    
    
    $
    12,310Weighted-average common shares outstanding:Basic
    
    
    65,298,747
    
    
    
    51,394,117
    
    
    
    65,294,411
    
    
    
    48,895,318Incremental shares from assumed conversion/exercise:Stock warrant
    
    
    
    
    
    
    125,993
    
    
    
    
    
    
    
    123,671Unvested restricted stock and LTIP units using the
treasury method
    
    
    54,345
    
    
    
    150,719
    
    
    
    48,076
    
    
    
    180,278Operating partnership and LTIP units
    
    
    2,916,564
    
    
    
    2,863,564
    
    
    
    2,916,075
    
    
    
    2,863,564Diluted
    
    
    68,269,656
    
    
    
    54,534,393
    
    
    
    68,258,562
    
    
    
    52,062,831Basic and diluted earnings per share:Income from
continuing operations available for common stockholders
    
    $
    0.20
    
    
    $
    0.13
    
    
    $
    0.44
    
    
    $
    0.22Discontinued operations
    
    
    0.02
    
    
    
    0.01
    
    
    
    0.02
    
    
    
    0.02Net income available to common stockholders
    
    $
    0.22
    
    
    $
    0.14
    
    
    $
    0.46
    
    
    $
    0.24
 15




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##### Table of Contents



8. Incentive Award Plan
     16




---



##### Table of Contents



Unvested
    
    
    Weighted-Restricted Shares and
    
    
    Average Grant-LTIP Units
    
    
    Date Fair-ValueBalance at January 1, 2007
    
    
    424,380
    
    
    $
    23.79Granted
    
    
    302,500
    
    
    
    29.83Forfeited
    
    
    (3,809
    )
    
    
    28.16Vested
    
    
    (199,818
    )
    
    
    19.96Balance at March 31, 2007
    
    
    523,253
    
    
    
    28.71Granted
    
    
    25,000
    
    
    
    27.49Forfeited
    
    
    (4,450
    )
    
    
    28.18Vested
    
    
    (10,000
    )
    
    
    28.59Balance at June 30, 2007
    
    
    533,803
    
    
    $
    28.66
 Unvested
    
    
    Weighted-Restricted Shares and
    
    
    Average Grant-LTIP Units
    
    
    Date Fair-ValueBalance at January 1, 2006
    
    
    344,492
    
    
    $
    17.70Granted
    
    
    147,200
    
    
    
    27.11Vested
    
    
    (153,194
    )
    
    
    16.53Balance at March 31, 2006
    
    
    338,498
    
    
    
    22.32Granted
    
    
    11,000
    
    
    
    28.53Forfeited
    
    
    (150
    )
    
    
    26.70Vested
    
    
    (10,000
    )
    
    
    21.20Balance at June 30, 2006
    
    
    339,348
    
    
    $
    22.55
 9. Segment Information
 Disclosures about Segments of an Enterprise and Related Information
 10. Property Acquisitions
  Deferred Leasing CostsAcquisition
    
    
    Investments
    
    
    Acquired Above
    
    
    In place
    
    
    
    
    
    
    Acquired Below
    
    
    Total CashProperty
    
    Date
    
    
    in Real Estate
    
    
    Market Lease
    
    
    Lease
    
    
    Management Fee
    
    
    Market Lease
    
    
    ConsiderationTorreyana Road
    
    March 22, 2007
    
    $
    32,128
    
    
    $
    
    
    
    $
    1,937
    
    
    $
    57
    
    
    $
    (1,082
    )
    
    $
    33,0406114-6154 Nancy
Ridge Drive
    
    May 2, 2007
    
    
    36,592
    
    
    
    645
    
    
    
    
    
    
    
    
    
    
    
    (127
    )
    
    
    37,1109920 Belward Campus
Drive
    
    May 8, 2007
    
    
    14,651
    
    
    
    
    
    
    
    1,282
    
    
    
    145
    
    
    
    (1,483
    )
    
    
    14,595Total
    
    
    
    
    
    $
    83,371
    
    
    $
    645
    
    
    $
    3,219
    
    
    $
    202
    
    
    $
    (2,692
    )
    
    $
    84,745Intangible
amortization life
(in months)
    
    
    
    
    
    
    
    
    
    
    241
    
    
    
    38
    
    
    
    55
    
    
    
    57
    
    
    
    
 17




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##### Table of Contents



11. Investment in Unconsolidated Partnerships
  Companys
    
    CompanysOwnership
    
    Economic
    
    Rentable
    
    
    
    
    
    AcquisitionName
    
    Partner
    
    Interest
    
    Interest
    
    Square Feet
    
    Date Acquired
    
    Price (1)PREI I (2)
    
    PREI
    
    
    20
    %
    
    
    20
    %
    
    
    184,445
    
    
    April 4, 2007
    
    $
    466,252PREI II (3)
    
    PREI
    
    
    20
    %
    
    
    20
    %
    
    
    284,706
    
    
    April 4, 2007
    
    $
    40,472McKellar Court (4)
    
    Quidel Corporation
    
    
    21
    %
    
    
    21%
    (5)
    
    
    72,863
    
    
    September 30, 2004
    
    $
    2,058
 
 (1)
    
    The acquisition price represents the total purchase price for the properties
acquired by each partnership, excluding closing costs.(2)
    
    The PREI I limited liability company (PREI I LLC) holds a portfolio of
properties in Cambridge, Massachusetts comprised of a stabilized laboratory/office
building totaling 184,445 square feet located at 320 Bent Street, a 37-unit apartment
building, an operating garage facility on Rogers Street with 503 spaces, an operating
below grade garage facility at Kendall Square with approximately
1,400 spaces, and a
building currently under construction at 301 Binney Street and a
development site at 650 East Kendall Street
that the Company believes can support up to 420,000 and 266,000 rentable square feet of
laboratory and office space, respectively. The development site at 650 East Kendall Street also
includes the potential to build a below grade parking facility that the Company estimates can support up to 560
spaces upon completion.Each of the PREI operating agreements includes a put/call option whereby either member
can cause the limited liability company to sell certain properties in which it holds
leasehold interests to the Company at any time after the fifth anniversary and before
the seventh anniversary of the acquisition date. However, the put/call option may be
terminated prior to exercise under certain circumstances. The put/call option
purchase price is based on a predetermined return on capital invested by PREI. If the
put/call option is exercised, the Company believes that it would have adequate
resources to fund the purchase price.The PREI limited liability companies jointly entered into a $550.0 million secured
acquisition and interim loan facility with KeyBank in which the partnerships utilized
approximately $427.0 million to fund a portion of the purchase price for the
properties acquired in April 2007. The remaining funds available will be utilized to
fund future construction costs at certain properties currently under development.
Pursuant to the loan facility, the Company executed guaranty agreements in which it
guaranteed the full completion of the construction at the 301 Binney Street property
if the partnership is unable or unwilling to complete the project.(3)
    
    The PREI II limited liability company (PREI II LLC) holds a portfolio of
properties comprised of a development parcel in Houston, Texas; a laboratory/office
building totaling 259,706 rentable square feet and fee simple and leasehold interests in
surrounding land parcels located at the Science Park at Yale in New Haven, Connecticut,
and 25,000 rentable square feet of retail space and additional pad sites for future
development in Cambridge, Massachusetts. Subsequent to June 30, 2007, PREI II LLC sold
the retail space and pad sites in Cambridge for a sales price substantially equal to the
original purchase price. PREI II LLC is also currently under contract to sell its
properties located at the Science Park at Yale in a transaction expected also to close
in the third quarter of 2007.(4)
    
    The McKellar Court partnership holds a property comprised of a two-story
laboratory/office building totaling 72,863 rentable square feet located in San Diego,
California.(5)
    
    The Companys economic interest in the McKellar partnership entitles it to 75% of
the gains upon a sale of the property and 21% of the operating cash flows.
  18




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##### Table of Contents



June 30,
    
    
    December 31,2007
    
    
    2006Assets:Investments in real estate, net
    
    $
    531,296
    
    
    $
    15,061Cash and cash equivalents (including restricted cash)
    
    
    6,935
    
    
    
    605Intangible assets, net
    
    
    19,333
    
    
    
    Other assets
    
    
    4,338
    
    
    
    1,078Total assets
    
    $
    561,902
    
    
    $
    16,744Liabilities and equity:Mortgage notes payable
    
    $
    451,181
    
    
    $
    10,619Other liabilities
    
    
    15,331
    
    
    
    285Members equity
    
    
    95,390
    
    
    
    5,840Total liabilities and equity
    
    $
    561,902
    
    
    $
    16,744Companys net investment in unconsolidated partnerships
    
    $
    20,425
    
    
    $
    2,436
 Accounting for Asset Retirement Obligations
  For the Three Months Ended
    
    
    For the Six Months EndedJune 30,
    
    
    June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Total revenues
    
    $
    5,423
    
    
    $
    481
    
    
    $
    5,902
    
    
    $
    962Rental operations
    
    
    2,165
    
    
    
    7
    
    
    
    2,175
    
    
    
    20Real estate taxes
    
    
    567
    
    
    
    38
    
    
    
    607
    
    
    
    76Depreciation and amortization
    
    
    1,786
    
    
    
    95
    
    
    
    1,882
    
    
    
    191Interest expense, net of interest income
    
    
    3,179
    
    
    
    236
    
    
    
    3,406
    
    
    
    471Total expenses
    
    
    7,697
    
    
    
    376
    
    
    
    8,070
    
    
    
    758Net (loss)/ income
    
    $
    (2,274
    )
    
    $
    105
    
    
    $
    (2,168
    )
    
    $
    204Companys equity in net (loss)/income
of unconsolidated partnerships
    
    $
    (454
    )
    
    $
    22
    
    
    $
    (432
    )
    
    $
    42
 12. Discontinued Operations
  Original
    
    Number of
    
    Rentable
    
    Sales Price
    
    Gain on SaleProperty
    
    Date of Sale
    
    Acquisition Date
    
    Buildings
    
    Square Feet
    
    (in thousands)Colorow Drive
    
    May 30, 2007
    
    December 22, 2005
    
    
    1
    
    
    
    93,650
    
    
    $
    20,000
    
    
    $
    1,088
  For the Three Months Ended
    
    
    For the Six Months EndedJune 30,
    
    
    June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Total revenues
    
    $
    441
    
    
    $
    669
    
    
    $
    1,111
    
    
    $
    1,333Total expenses
    
    
    189
    
    
    
    283
    
    
    
    472
    
    
    
    560Income before minority interests and gain on sale
    
    
    252
    
    
    
    386
    
    
    
    639
    
    
    
    773Gain on sale of real estate assets
    
    
    1,088
    
    
    
    
    
    
    
    1,088
    
    
    
    Minority interests attributable to discontinued operations
    
    
    (57
    )
    
    
    (21
    )
    
    
    (74
    )
    
    
    (43
    )Income from discontinued operations
    
    $
    1,283
    
    
    $
    365
    
    
    $
    1,653
    
    
    $
    730
 19




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##### Table of Contents



13. Derivatives and Other Financial Instruments
  Current
    
    
    
    
    
    
    
    
    
    
    
    
    
    Fair ValueNotional Amount
    
    Strike Rate

    
    Effective Date
    
    
    Expiration Date
    
    
    June 30, 2007
    
    
    December 31, 2006$250,000
    
    
    4.157
    %
    
    June 1, 2005
    
    June 1, 2010
    
    $
    7,364
    
    
    $
    6,263150,000
    
    
    5.152
    %
    
    December 30, 2008
    
    December 30, 2018
    
    
    6,488
    
    
    
    808150,000
    
    
    5.162
    %
    
    December 30, 2008
    
    December 30, 2018
    
    
    6,383
    
    
    
    70450,000
    
    
    5.167
    %
    
    December 30, 2008
    
    December 30, 2018
    
    
    2,110
    
    
    
    217100,000
    
    
    5.167
    %
    
    December 30, 2008
    
    December 30, 2018
    
    
    4,221
    
    
    
    434$700,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    26,566
    
    
    $
    8,426
      20




---



##### Table of Contents



14. New Accounting Standards
 Accounting for Uncertainty in Income
Taxes, an Interpretation of FASB Statement No. 109
 Fair-Value Measurements
 The Fair-Value Option for Financial Assets and
Financial Liabilities
 15. Subsequent Events
    21




---



##### Table of Contents



ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
   Overview
   RentableSquare FeetOperating portfolio
    
    
    6,722,869Repositioning and redevelopment properties
    
    
    1,751,527Total
current portfolio
    
    
    8,474,396Construction in progress
    
    
    1,661,000Land parcels
    
    
    1,468,000Total
proforma portfolio
    
    
    11,603,396
 22




---



##### Table of Contents



Factors Which May Influence Future Operations
   Critical Accounting Policies
  New Accounting Standards
 Accounting for Uncertainty in Income
Taxes, an Interpretation of FASB Statement No. 109
 Fair-Value Measurements
 The Fair-Value Option for Financial Assets and
Financial Liabilities
 23




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##### Table of Contents



Results of Operations
 Comparison of the Three Months Ended June 30, 2007 to the Three Months Ended June 30, 2006
  Same Properties
    
    
    New Properties
    
    
    Total PropertiesThree Months Ended June 30,
    
    
    Three Months Ended June 30,
    
    
    Three Months Ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006
    
    
    2007
    
    
    2006Rental
    
    $
    30,807
    
    
    $
    30,594
    
    
    $
    18,653
    
    
    $
    5,401
    
    
    $
    49,460
    
    
    $
    35,995Tenant recoveries
    
    
    12,510
    
    
    
    12,464
    
    
    
    3,160
    
    
    
    267
    
    
    
    15,670
    
    
    
    12,731Other income
    
    
    3,299
    
    
    
    64
    
    
    
    
    
    
    
    
    
    
    
    3,299
    
    
    
    64Total revenues
    
    $
    46,616
    
    
    $
    43,122
    
    
    $
    21,813
    
    
    $
    5,668
    
    
    $
    68,429
    
    
    $
    48,790
 Rental Revenues.
 Tenant Recoveries.
 Other Income.
  Same Properties
    
    
    New Properties
    
    
    Total PropertiesThree Months Ended June 30,
    
    
    Three Months Ended June 30,
    
    
    Three Months Ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006
    
    
    2007
    
    
    2006Rental operations
    
    $
    11,036
    
    
    $
    9,465
    
    
    $
    1,844
    
    
    $
    82
    
    
    $
    12,880
    
    
    $
    9,547Real estate taxes
    
    
    3,886
    
    
    
    4,309
    
    
    
    1,657
    
    
    
    227
    
    
    
    5,543
    
    
    
    4,536Depreciation and amortization
    
    
    14,583
    
    
    
    13,239
    
    
    
    5,054
    
    
    
    1,338
    
    
    
    19,637
    
    
    
    14,577General and administrative (1)
    
    
    5,364
    
    
    
    4,206
    
    
    
    
    
    
    
    
    
    
    
    5,364
    
    
    
    4,206Total expenses
    
    $
    34,869
    
    
    $
    31,219
    
    
    $
    8,555
    
    
    $
    1,647
    
    
    $
    43,424
    
    
    $
    32,866
 
 (1)
    
    General and administrative expenses are included in the same property
presentation as they are not allocable to specific properties. Rental Operations Expense.
 Real Estate Tax Expense.
 Depreciation and Amortization Expense.
 24




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##### Table of Contents



General and Administrative Expenses.
 Equity in Net (Loss)/Income of Unconsolidated Partnerships.
 Interest Income.
 Interest Expense.
 Minority Interest in Consolidated Partnerships.
 Minority Interests in Operating Partnership.
 Discontinued Operations.
 Comparison of the Six Months Ended June 30, 2007 to the Six Months Ended June 30, 2006
  Same Properties
    
    
    New Properties
    
    
    Total PropertiesSix Months Ended June 30,
    
    
    Six Months Ended June 30,
    
    
    Six Months Ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006
    
    
    2007
    
    
    2006Rental
    
    $
    61,520
    
    
    $
    61,210
    
    
    $
    35,449
    
    
    $
    5,401
    
    
    $
    96,969
    
    
    $
    66,611Tenant recoveries
    
    
    25,957
    
    
    
    24,971
    
    
    
    6,223
    
    
    
    267
    
    
    
    32,180
    
    
    
    25,238Other income
    
    
    8,078
    
    
    
    70
    
    
    
    
    
    
    
    
    
    
    
    8,078
    
    
    
    70Total revenues
    
    $
    95,555
    
    
    $
    86,251
    
    
    $
    41,672
    
    
    $
    5,668
    
    
    $
    137,227
    
    
    $
    91,919
 Rental Revenues.
 25




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##### Table of Contents



Tenant Recoveries.
 Other Income.
  Same Properties
    
    
    New Properties
    
    
    Total PropertiesSix Months Ended June 30,
    
    
    Six Months Ended June 30,
    
    
    Six Months Ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006
    
    
    2007
    
    
    2006Rental operations
    
    $
    22,442
    
    
    $
    18,918
    
    
    $
    3,553
    
    
    $
    82
    
    
    $
    25,995
    
    
    $
    19,000Real estate taxes
    
    
    8,219
    
    
    
    8,500
    
    
    
    3,240
    
    
    
    227
    
    
    
    11,459
    
    
    
    8,727Depreciation and amortization
    
    
    27,545
    
    
    
    26,464
    
    
    
    9,346
    
    
    
    1,338
    
    
    
    36,891
    
    
    
    27,802General and administrative (1)
    
    
    10,707
    
    
    
    8,553
    
    
    
    
    
    
    
    
    
    
    
    10,707
    
    
    
    8,553Total expenses
    
    $
    68,913
    
    
    $
    62,435
    
    
    $
    16,139
    
    
    $
    1,647
    
    
    $
    85,052
    
    
    $
    64,082
 
 (1)
    
    General and administrative expenses are included in the same property
presentation as they are not allocable to specific properties. Rental Operations Expense.
 Real Estate Tax Expense.
 Depreciation and Amortization Expense.
 General and Administrative Expenses.
 Equity in Net (Loss)/Income of Unconsolidated Partnerships.
 26




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##### Table of Contents



Interest Income.
 Interest Expense.
 Minority Interest in Consolidated Partnerships.
 Minority Interests in Operating Partnership.
 Discontinued Operations.
 Cash Flows
 Comparison of Six Months Ended June 30, 2007 to Six Months Ended June 30, 2006
 Six Months Ended June 30,2007
    
    2006
    
    Change(In thousands)Net cash provided by operating activities
    
    $
    51,072
    
    
    $
    44,747
    
    
    $
    6,325Net cash used in investing activities
    
    
    (203,644
    )
    
    
    (489,968
    )
    
    
    286,324Net cash provided by financing activities
    
    
    147,290
    
    
    
    448,002
    
    
    
    (300,712
    )Ending cash and cash equivalents balance
    
    
    20,382
    
    
    
    23,093
    
    
    
    (2,711
    )
     27




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##### Table of Contents



Funds from Operations
   For the Three Months
    
    
    For the Six MonthsEnded June 30,
    
    
    Ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Net income available to common stockholders
    
    $
    14,172
    
    
    $
    7,158
    
    
    $
    30,221
    
    
    $
    11,632Adjustments:Minority interests in operating partnership
    
    
    634
    
    
    
    402
    
    
    
    1,350
    
    
    
    678Gain on sale of real estate assets
    
    
    (1,088
    )
    
    
    
    
    
    
    (1,088
    )
    
    
    Depreciation and amortization  real estate
assets (unconsolidated partnerships)
    
    
    358
    
    
    
    20
    
    
    
    378
    
    
    
    40Depreciation and amortization  real estate
assets (consolidated entities-discontinued
operations)
    
    
    91
    
    
    
    137
    
    
    
    228
    
    
    
    274Depreciation and amortization  real estate
assets (consolidated entities-continuing
operations)
    
    
    19,637
    
    
    
    14,577
    
    
    
    36,891
    
    
    
    27,801Funds from operations
    
    $
    33,804
    
    
    $
    22,294
    
    
    $
    67,980
    
    
    $
    40,425Funds from operations per share  diluted
    
    $
    0.50
    
    
    $
    0.41
    
    
    $
    1.00
    
    
    $
    0.78Weighted-average common shares outstanding  diluted
    
    
    68,269,656
    
    
    
    54,534,393
    
    
    
    68,258,562
    
    
    
    52,062,831
 Liquidity and Capital Resources
  
    
    interest expense and scheduled principal payments on outstanding indebtedness,
    
    general and administrative expenses, and
    
    capital expenditures, tenant improvements and leasing commissions.
   28




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##### Table of Contents



Aggregate PrincipalAmount or
    
    
    Percent of TotalShares/Units
    
    
    Dollar Value
    
    
    Marketat June 30, 2007
    
    
    Equivalent
    
    
    Capitalization(In thousands)Debt:Mortgage notes payable (1)
    
    
    
    
    
    $
    399,522
    
    
    
    12.2
    %Secured construction loan
    
    
    
    
    
    
    356,071
    
    
    
    10.9
    %Secured term loan
    
    
    
    
    
    
    250,000
    
    
    
    7.7
    %Exchangeable notes
    
    
    
    
    
    
    175,000
    
    
    
    5.4
    %Unsecured line of credit
    
    
    
    
    
    
    132,150
    
    
    
    4.0
    %Total debt
    
    
    
    
    
    
    1,312,743
    
    
    
    40.2
    %Equity:Common shares outstanding (2)
    
    
    65,462,839
    
    
    
    1,644,427
    
    
    
    50.3
    %7.375% Series A Preferred shares outstanding (3)
    
    
    9,200,000
    
    
    
    230,000
    
    
    
    7.0
    %Operating partnership units outstanding (4)
    
    
    2,863,564
    
    
    
    71,933
    
    
    
    2.2
    %LTIP units outstanding (4)
    
    
    432,666
    
    
    
    10,869
    
    
    
    0.3
    %Total equity
    
    
    
    
    
    
    1,957,229
    
    
    
    59.8
    %Total capitalization
    
    
    
    
    
    $
    3,269,972
    
    
    
    100.0
    %
 
 (1)
    
    Amount includes debt premiums of $12.2 million recorded upon the assumption of
the outstanding indebtedness in connection with our purchase of the corresponding
properties.(2)
    
    Based on the market closing price of our common stock of $25.12 per share on the
last trading day of the quarter (June 29, 2007).(3)
    
    Based on the liquidation preference of $25.00 per share for our 7.375% Series A
preferred stock.(4)
    
    Common stock equivalents of our partnership and LTIP units, which are each
individually convertible into one share of common stock.   29




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##### Table of Contents



Off Balance Sheet Arrangements
     Principal Amount (1)PartnershipOwnershipName
    
    Percentage
    
    
    Interest Rate (2)
    
    
    June 30, 2007
    
    
    December 31, 2006
    
    
    Maturity DatePREI I and PREI II (3)
    
    
    20
    %
    
    
    6.17
    %
    
    $
    88,125
    
    
    $
    
    
    
    April 3, 2008McKellar Court (4)
    
    
    21
    %
    
    
    4.63
    %
    
    
    2,442
    
    
    
    2,230
    
    
    January 1, 2010Total
    
    
    
    
    
    
    
    
    
    $
    90,567
    
    
    $
    2,230
 
 (1)
    
    Amount represents our proportionate share of the total outstanding indebtedness
for each of the unconsolidated partnerships.(2)
    
    Effective or weighted average interest rate of the outstanding indebtedness as of
June 30, 2007.(3)
    
    Amount represents our proportionate share of the total draws outstanding under a
$550.0 million secured acquisition and interim loan facility, which bears interest at a
LIBOR-indexed variable rate. The secured acquisition and interim loan facility was
utilized by both PREI I LLC and PREI II LLC to acquire a portfolio of properties
(initial borrowings of approximately $427.0 million) on April 4, 2007 (see Note 11).
The remaining balance will be utilized to fund future construction costs at certain
properties currently under development.(4)
    
    Amount represents our proportionate share of the principal balance outstanding on
a mortgage note payable, which is secured by the McKellar Court property (including
$225,000 of unamortized debt premium). Accounting for Asset Retirement Obligations
 30




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##### Table of Contents



Cash Distribution Policy
 i.e.
  Dividend
    
    
    DividendQuarter Ended
    
    Date Declared
    
    Date Paid
    
    per Common Share
    
    
    per Preferred ShareMarch 31, 2005
    
    March 14, 2005
    
    April 15, 2005
    
    $
    0.2700
    
    
    $
    June 30, 2005
    
    June 3, 2005
    
    July 15, 2005
    
    
    0.2700
    
    
    
    September 30, 2005
    
    September 14, 2005
    
    October 17, 2005
    
    
    0.2700
    
    
    
    December 31, 2005
    
    December 13, 2005
    
    January 16, 2006
    
    
    0.2700
    
    
    
    March 31, 2006
    
    February 27, 2006
    
    April 17, 2006
    
    
    0.2900
    
    
    
    June 30, 2006
    
    May 19, 2006
    
    July 17, 2006
    
    
    0.2900
    
    
    
    September 30, 2006
    
    September 14, 2006
    
    October 16, 2006
    
    
    0.2900
    
    
    
    December 31, 2006
    
    December 13, 2006
    
    January 16, 2007
    
    
    0.2900
    
    
    
    March 31, 2007
    
    March 15, 2007
    
    April 16, 2007
    
    
    0.3100
    
    
    
    0.45582June 30, 2007
    
    June 15, 2007
    
    July 16, 2007
    
    
    0.3100
    
    
    
    0.45582
 Inflation
   
 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
   Effective InterestPercent of
    
    
    Rate atDebt Summary (1)
    
    
    Total Debt
    
    
    End of QuarterFixed interest rate (2)
    
    $
    574,522
    
    
    
    43.8
    %
    
    
    5.14
    %Variable interest rate (3)
    
    
    738,221
    
    
    
    56.2
    %
    
    
    6.53
    %Total/effective interest rate
    
    $
    1,312,743
    
    
    
    100.0
    %
    
    
    5.93
    %
 
 (1)
    
    Debt summary includes only consolidated indebtedness.(2)
    
    Includes 16 mortgage notes payable secured by certain of our properties
(including $12.2 million of unamortized premium) and our exchangeable notes. 31




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##### Table of Contents



(3)
    
    Includes our revolving line of credit and our secured construction loan, both of
which bear interest based on LIBOR, plus a credit spread. Also includes our $250.0
million secured term loan, which bears a LIBOR-indexed variable interest rate. However,
we have entered into an interest rate swap agreement that effectively fixes the interest
rate on the entire $250.0 million outstanding balance at a rate of 6.4% through the
maturity date. We have entered into four forward starting swap agreements, which will
have the effect of fixing the interest rate on $450.0 million of forecasted debt
issuance (after retirement of the secured construction loan) at 5.2%.
    
 ITEM 4. CONTROLS AND PROCEDURES
    32




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##### Table of Contents



PART II  OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
  
 ITEM 1A. RISK FACTORS
  
 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
  
 ITEM 3. DEFAULTS UPON SENIOR SECURITIES
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  Votes For
    
    Votes WithheldAlan D. Gold
    
    
    56,607,302
    
    
    
    875,352Gary A. Kreitzer
    
    
    57,014,285
    
    
    
    468,369Barbara R. Cambon
    
    
    57,406,093
    
    
    
    76,561Edward A. Dennis, Ph.D.
    
    
    57,404,359
    
    
    
    78,295Mark J. Riedy, Ph.D.
    
    
    57,405,184
    
    
    
    77,470Theodore D. Roth
    
    
    57,404,204
    
    
    
    78,450M. Faye Wilson
    
    
    57,404,893
    
    
    
    77,761
  
 ITEM 5. OTHER INFORMATION
  33




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##### Table of Contents



ITEM 6. EXHIBITS
 ExhibitNumber
    
    Description of Exhibit10.1
    
    Dividend Reinvestment and Stock Purchase Plan.(1)31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 (1)
    
    Incorporated herein by reference to BioMed Realty Trust, Inc.s Registration Statement on
Form S-3 (File No. 333-143658), filed with the Securities and Exchange Commission on June 11,
2007. 34




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##### Table of Contents



SIGNATURES
  BioMed Realty Trust, Inc./s/
    
    ALAN D. GOLD

Alan D. Gold
Chairman of the Board, President and Chief
Executive Officer (Principal Executive Officer)/s/
    
    KENT GRIFFINKent Griffin
Chief Financial Officer (Principal Financial Officer)Dated: August 7, 2007
 35




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description of Exhibit10.1
    
    Dividend Reinvestment and Stock Purchase Plan.(1)31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 (1)
    
    Incorporated herein by reference to BioMed Realty Trust, Inc.s Registration Statement on
Form S-3 (File No. 333-143658), filed with the Securities and Exchange Commission on June 11,
2007. 36