<PAGE>

                                  Exhibit 3.7


                        Series D Cumulative Convertible
              Redeemable Preferred Shares of Beneficial Interest


                            ARTICLES SUPPLEMENTARY

                           PRENTISS PROPERTIES TRUST




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

                   Articles Supplementary of Board of Trustees
                     Classifying and Designating a Series of
                   Preferred Shares of Beneficial Interest as
                   Series D Cumulative Convertible Redeemable
                   Preferred Shares of Beneficial Interest and
                    Fixing Distribution and Other Preferences
                            and Rights of Such Series

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

                           Dated as of March 20, 2001
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                            PRENTISS PROPERTIES TRUST


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

                   Articles Supplementary of Board of Trustees
                     Classifying and Designating a Series of
                   Preferred Shares of Beneficial Interest as
                   Series D Cumulative Convertible Redeemable
                   Preferred Shares of Beneficial Interest and
                    Fixing Distribution and Other Preferences
                            and Rights of Such Series

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


         Prentiss Properties Trust, a Maryland real estate investment trust (the
"Trust"), hereby certifies to the State Department of Assessments and Taxation
of Maryland pursuant to section 8-203(b) of the Corporations and Associations
Article of the Annotated Code of Maryland that:

         FIRST: Pursuant to authority granted by the Amended and Restated
Declaration of Trust of the Trust (the "Declaration"), the Board of Trustees on
February 14, 2001 adopted a resolution designating and classifying 3,773,585
unissued and unclassified preferred shares of beneficial interest of the Trust
as Series D Cumulative Convertible Redeemable Preferred Shares of Beneficial
Interest.

         SECOND: The following is a description of the Series D Cumulative
Convertible Redeemable Preferred Shares of Beneficial Interest of the Trust (the
"Series D Preferred Shares"), including the preferences, conversion and other
rights, voting powers, restrictions, limitations as to dividends and other
distributions, qualifications, and terms and conditions of redemption thereof,
which, upon any restatement of the Declaration, may be made a part of Article VI
of the Declaration with any appropriate changes in enumeration or lettering of
any section or subsections thereof:

         Section 1. NUMBER OF SHARES AND DESIGNATION. This class of preferred
shares of beneficial interest shall be designated as Series D Cumulative
Convertible Redeemable Preferred Shares of Beneficial Interest and the number of
shares which shall constitute such series shall not be more than 3,773,585
shares, par value $0.01 per share, which number may be decreased (but not below
the aggregate number thereof then outstanding and/or which have been reserved
for issuance) from time to time by the Board of Trustees.

         Section 2. DEFINITIONS. For purposes of the Series D Preferred Shares,
the following terms shall have the meanings indicated:
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                  "APPLICABLE TREASURY RATE," for each Dividend Period, shall
         mean the annual yield to maturity of U.S. Treasury securities with a
         ten-year maturity, as compiled by and published in the most recent
         Federal Reserve Statistical Release H.15(519) which has become publicly
         available prior to the last Business Day of such Dividend Period (or,
         if such Statistical Release is no longer published, any publicly
         available source of similar data).

                  "BASE RATE" shall mean an annual dividend payment in an amount
         per share equal to $1.60; provided, however, that, if the Trust gives
         notice of its election to make a Dividend Increase (as defined in the
         Exchange Agreement) following a Change of Control in accordance with
         Section 6.7 of the Exchange Agreement, then from and after the date of
         such notice, the "Base Rate" shall mean an annual dividend payment in
         an amount per share equal to the product of (a) the greater of (1) 800
         basis points plus the Applicable Treasury Rate or (2) 12% and (b) the
         greater of (1) the Liquidation Preference per Series D Preferred Share
         and (2) the Volume-Weighted Average Trading Price for the thirty
         trading days preceding the closing of the Change of Control transaction
         of the number of Common Shares into which each Series D Preferred Share
         is then convertible.

                  "BOARD OF TRUSTEES" shall mean the Board of Trustees of the
         Trust or any committee authorized by such Board of Trustees to perform
         any of its responsibilities with respect to the Series D Preferred
         Shares.

                  "BUSINESS DAY" shall mean any day, other than a Saturday or
         Sunday, that is neither a legal holiday nor a day on which banking
         institutions in New York City, New York are authorized or required by
         law, regulation or executive order to close.

                  "CALL DATE" shall mean the date specified in the notice to
         holders required under Section 5(d) as the Call Date.

                  "CHANGE OF CONTROL" shall have the meaning set forth in
         Section 6.7(f) of the Exchange Agreement.

                  "CODE" shall mean the Internal Revenue Code of 1986, as
         amended.

                  "COMMON SHARES" shall mean the common shares of beneficial
         interest, par value $0.01 per share, of the Trust.

                  "CONSOLIDATED AFFILIATES" shall mean all entities whose
         financial results are consolidated with those of the Trust in
         accordance with GAAP.

                  "CONSTITUENT PERSON" shall have the meaning set forth in
         Section 6(e).

                  "CONVERSION DATE" shall have the meaning set forth in Section
         6(a).

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                  "CONVERSION PRICE" shall mean the conversion price per Common
         Share for which the Series D Preferred Shares are convertible, as such
         Conversion Price may be adjusted pursuant to Section 6. The initial
         conversion price shall be $26.50.

                  "CURRENT MARKET PRICE" of publicly traded Common Shares or any
         other class of shares of beneficial interest or other security of the
         Trust or any other issuer for any day shall mean the last reported
         sales price, regular way, on such day, or, if no sale takes place on
         such day, the average of the reported closing bid and asked prices on
         such day, regular way, in either case as reported on the New York Stock
         Exchange ("NYSE") or, if such security is not listed or admitted for
         trading on the NYSE, on the principal national securities exchange on
         which such security is listed or admitted for trading or, if not listed
         or admitted for trading on any national securities exchange, on the
         Nasdaq National Market ("NASDAQ") or, if such security is not quoted on
         NASDAQ, the average of the closing bid and asked prices on such day in
         the over-the-counter market as reported by the National Association of
         Securities Dealers, Inc. (the "NASD") or, if bid and asked prices for
         such security on such day shall not have been reported through the
         NASD, the average of the bid and asked prices on such day as furnished
         by any NYSE member firm regularly making a market in such security
         selected for such purpose by the Board of Trustees.

                  "DIVIDEND PAYMENT DATE" shall mean (i) for any Dividend Period
         with respect to which the Trust pays a dividend on the Common Shares,
         the date on which such dividend is paid, or (ii) for any Dividend
         Period with respect to which the Trust does not pay a dividend on the
         Common Shares, a date to be set by the Board of Trustees, which date
         shall not be later than the thirtieth calendar day after the end of the
         applicable Dividend Period.

                  "DIVIDEND PERIODS" shall mean quarterly dividend periods
         commencing on January 1, April 1, July 1 and October 1 of each year and
         ending on and including the day preceding the first day of the next
         succeeding Dividend Period with respect to any Series D Preferred
         Shares (other than the initial Dividend Period, which shall commence on
         the Issue Date for such Series D Preferred Shares and end on and
         include the last day of the calendar quarter immediately following such
         Issue Date, and other than the Dividend Period during which any Series
         D Preferred Shares shall be redeemed pursuant to Section 5 or converted
         pursuant to Section 6, which shall end on and include the Call Date
         with respect to the Series D Preferred Shares being redeemed or the
         date that such Series D Preferred Shares are converted, as the case may
         be).

                  "EXCHANGE AGREEMENT" shall mean the Exchange Agreement, dated
         as of March 20, 2001, by and among Security Capital Preferred Growth
         Incorporated, a Maryland corporation, the Trust and the Operating
         Partnership, as amended from time to time.

                  "EXPIRATION TIME" shall have the meaning set forth in Section
         6(d)(iv).

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                  "FAIR MARKET VALUE" shall mean the average of the daily
         Current Market Prices of a Common Share on the five (5) consecutive
         Trading Days selected by the Trust commencing not more than 20 Trading
         Days before, and ending not later than, the earlier of the day in
         question and the day before the "ex date" with respect to the issuance
         or distribution requiring such computation. The term "ex date," when
         used with respect to any issuance or distribution, means the first day
         on which the Common Shares trade regular way, without the right to
         receive such issuance or distribution, on the exchange or in the
         market, as the case may be, used to determine that day's Current Market
         Price.

                  "FULLY JUNIOR SHARES" shall mean the Common Shares and any
         other class or series of shares of beneficial interest of the Trust now
         or hereafter issued and outstanding over which the Series D Preferred
         Shares have preference or priority in both (i) the payment of dividends
         and (ii) the distribution of assets on any liquidation, dissolution or
         winding up of the Trust.

                  "FUNDS FROM OPERATIONS" shall mean net income (loss) (computed
         in accordance with generally accepted accounting principles) excluding
         gains (or losses) from debt restructuring, and distributions in excess
         of earnings allocated to other Operating Partnership interests or
         minority interests (as reflected in the financial statements of the
         Trust) plus depreciation/amortization of assets unique to the real
         estate industry, all computed in a manner consistent with the revised
         definition of Funds From Operations adopted by the National Association
         of Real Estate Investment Trusts (NAREIT), in its White Paper dated
         March 1995, as such definitions may be modified from time to time, as
         determined by the Trust in good faith.

                  "GAAP" shall mean U.S. generally accepted accounting
         principles, consistently applied.

                  "ISSUE DATE" shall mean the date on which the Series D
         Preferred Shares are issued.

                  "JUNIOR SHARES" shall mean the Common Shares and any other
         class or series of shares of beneficial interest of the Trust now or
         hereafter issued and outstanding over which the Series D Preferred
         Shares have preference or priority in the payment of dividends or in
         the distribution of assets on any liquidation, dissolution or winding
         up of the Trust.

                  "NON-ELECTING SHARE" shall have the meaning set forth in
         Section 6(e).

                  "OPERATING PARTNERSHIP" shall mean Prentiss Properties
         Acquisition Partners, L.P., a Delaware limited partnership.

                  "PARITY SHARES" shall have the meaning set forth in Section
         9(b).

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                  "PERSON" shall mean any individual, firm, partnership,
         corporation, limited liability company, trust or other entity, and
         shall include any successor (by merger or otherwise) of such entity.

                  "PURCHASED SHARES" shall have the meaning set forth in Section
         6(d)(iv).

                  "REIT TERMINATION EVENT" shall mean the earliest to occur of:

                  (i)      the filing of a federal income tax return by the
                           Trust for any taxable year on which the Trust does
                           not compute its income as a real estate investment
                           trust;

                  (ii)     the approval by the shareholders of the Trust of a
                           proposal for the Trust to cease to qualify as a real
                           estate investment trust;

                  (iii)    a determination by the Board of Trustees of the
                           Trust, based on the advice of counsel, that the Trust
                           has ceased to qualify as a real estate investment
                           trust; or

                  (iv)     a "determination" within the meaning of Section
                           1313(a) of the Code that the Trust has ceased to
                           qualify as a real estate investment trust.

                  "SECURITIES" and "SECURITY" shall have the meanings set forth
         in Section 6(d)(iii).

                  "SECURITIES ACT" shall mean the Securities Act of 1933, as
         amended.

                  "SERIES D PREFERRED SHARES" shall have the meaning given such
         term in the preamble to these Articles Supplementary.

                  "SET APART FOR PAYMENT" shall be deemed to include, without
         any action other than the following, the recording by the Trust in its
         accounting ledgers of any accounting or bookkeeping entry which
         indicates, pursuant to a declaration of dividends or other distribution
         by the Board of Trustees, the allocation of funds to be so paid on any
         series or class of shares of beneficial interest of the Trust;
         PROVIDED, HOWEVER, that if any funds for any class or series of Junior
         Shares or any class or series of shares of beneficial interest ranking
         on a parity with the Series D Preferred Shares as to the payment of
         dividends are placed in a separate account of the Trust or delivered to
         a disbursing, paying or other similar agent, then "set apart for
         payment" with respect to the Series D Preferred Shares shall mean
         placing such funds in a separate account or delivering such funds to a
         disbursing, paying or other similar agent.

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<PAGE>

                  "TRADING DAY" shall mean any day on which the securities in
         question are traded on the NYSE, or if such securities are not listed
         or admitted for trading on the NYSE, on the principal national
         securities exchange on which such securities are listed or admitted, or
         if not listed or admitted for trading on any national securities
         exchange, on NASDAQ, or if such securities are not quoted on NASDAQ, in
         the securities market in which the securities are traded.

                  "TRANSACTION" shall have the meaning set forth in Section
         6(e).

                  "TRANSFER AGENT" shall mean the Trust, or such other agent or
         agents of the Trust as may be designated by the Board of Trustees or
         their designee as the transfer agent, registrar and dividend disbursing
         agent for the Series D Preferred Shares.

                  "UNCONSOLIDATED AFFILIATES" shall mean all entities in which
         the Trust has an ownership interest but whose financial results are not
         consolidated with those of the Trust in accordance with GAAP; provided,
         however, that Broadmoor Austin Associates, a Texas limited partnership
         and any joint venture or other enterprise with Security Capital
         Preferred Growth Incorporated or any controlled affiliate of Security
         Capital Preferred Growth Incorporated shall not be considered an
         Unconsolidated Affiliate.

                  "VOLUME-WEIGHTED AVERAGE TRADING PRICE" shall mean, for any
         period, the number obtained by dividing (i) the sum of the products,
         for each sale of any security during such period, of (a) the sale price
         of such security, regular way, as reported in the principal
         consolidated transaction reporting system with respect to securities
         listed or admitted to trading on the NYSE or, if the securities are not
         listed or admitted to trading on the NYSE, as reported in the principal
         consolidated transaction reporting system with respect to securities
         listed on the principal national securities exchange on which the
         securities are listed or admitted to trading or, if the securities are
         not listed or admitted to trading on any national securities exchange,
         the sale price as reported by the National Association of Securities
         Dealers, Inc. Automated Quotation System or, if such system is no
         longer in use, the principal other automated quotation system that may
         then be in use or, if the securities are not quoted by any such
         organization, the sale prices as furnished by professional market
         makers making a market in the securities or, if the securities are not
         publicly traded, the sale price as reasonably determined in good faith
         by the Board of Trustees and (b) the number of such securities sold by
         (ii) the total number of such securities sold during such period.

Capitalized terms not otherwise defined herein have the meanings ascribed to
them in the Declaration.

         Section 3.        DIVIDENDS.

                  (a) Subject to the preferential rights of the holders of any
         Preferred Shares that rank senior in the payment of dividends to the
         Series D Preferred Shares, the holders of

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         Series D Preferred Shares shall be entitled to receive, when, as and if
         declared by the Board of Trustees, out of funds legally available for
         the payment of dividends, cumulative preferential dividends payable in
         cash in an amount per share equal to the greater of (i) the Base Rate
         or (ii) the regular cash dividends (determined on each Dividend Payment
         Date) on the Common Shares, or portion thereof, into which a Series D
         Preferred Share is convertible. The dividends referred to in clause
         (ii) of the preceding sentence shall equal the number of Common Shares,
         or portion thereof, into which one Series D Preferred Share will be
         convertible on and after the Conversion Date, multiplied by the most
         current quarterly dividend on one Common Share on or before the
         applicable Dividend Payment Date. If the Trust pays a regular cash
         dividend on the Common Shares with respect to a Dividend Period after
         the date on which the Dividend Payment Date is declared pursuant to
         clause (ii) of the definition of Dividend Payment Date and the dividend
         calculated pursuant to clause (ii) of this paragraph (a) with respect
         to such Dividend Period is greater than the dividend previously
         declared on the Series D Preferred Shares with respect to such Dividend
         Period, the Trust shall pay an additional dividend to the holders of
         the Series D Preferred Shares on the date on which the dividend on the
         Common Shares is paid, in an amount equal to the difference between (y)
         the dividend calculated pursuant to clause (ii) of this paragraph (a)
         and (z) the amount of dividends previously declared on the Series D
         Preferred Shares with respect to such Dividend Period. The dividends
         shall begin to accrue and shall be fully cumulative from the first day
         of the applicable Dividend Period, whether or not in any Dividend
         Period or Periods there shall be funds of the Trust legally available
         for the payment of such dividends, and shall be payable quarterly,
         when, as and if declared by the Board of Trustees, in arrears on
         Dividend Payment Dates. Each such dividend shall be payable in arrears
         to the holders of record of Series D Preferred Shares as they appear in
         the records of the Trust at the close of business on such record dates,
         not less than 10 nor more than 50 days preceding such Dividend Payment
         Dates thereof, as shall be fixed by the Board of Trustees. Accrued and
         unpaid dividends for any past Dividend Periods may be declared and paid
         at any time and for such interim periods, without reference to any
         regular Dividend Payment Date, to holders of record on such date, not
         less than 10 nor more than 50 days preceding the payment date thereof,
         as may be fixed by the Board of Trustees. Any dividend payment made on
         Series D Preferred Shares shall first be credited against the earliest
         accrued but unpaid dividend due with respect to Series D Preferred
         Shares which remains payable.

                  (b) The amount of dividends referred to in clause (i) of
         Section 3(a) payable for each full Dividend Period on the Series D
         Preferred Shares shall be computed by dividing the annual dividend rate
         by four. The initial Dividend Period for the Series D Preferred Shares
         will include a partial dividend for the period from the Issue Date
         until the last day of the calendar quarter immediately following such
         Issue Date. The amount of dividends payable for such period, or any
         other period shorter than a full Dividend Period, on the Series D
         Preferred Shares shall be computed by dividing the number of days in
         such period by 365 and multiplying the result by the Series D Preferred
         dividend rate determined in accordance with Section 3(a). Holders of
         Series D Preferred Shares shall not be entitled to any dividends,

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<PAGE>

         whether payable in cash, property or shares, in excess of cumulative
         dividends, as herein provided, on the Series D Preferred Shares. No
         interest, or sum of money in lieu of interest, shall be payable in
         respect of any dividend payment or payments on the Series D Preferred
         Shares which may be in arrears.

                  (c) So long as any Series D Preferred Shares are outstanding,
         no dividends, except as described in the immediately following
         sentence, shall be declared or paid or set apart for payment on any
         class or series of Parity Shares for any period unless full cumulative
         dividends have been or contemporaneously are declared and paid or
         declared and a sum sufficient for the payment thereof set apart for
         such payment on the Series D Preferred Shares for all Dividend Periods
         terminating on or prior to the dividend payment date on such class or
         series of Parity Shares. When dividends are not paid in full or a sum
         sufficient for such payment is not set apart, as aforesaid, all
         dividends declared upon Series D Preferred Shares and all dividends
         declared upon any other class or series of Parity Shares shall be
         declared ratably in proportion to the respective amounts of dividends
         accumulated and unpaid on the Series D Preferred Shares and accumulated
         and unpaid on such Parity Shares.

                  (d) So long as any Series D Preferred Shares are outstanding,
         no dividends (other than dividends or distributions paid solely in
         shares of, or options, warrants or rights to subscribe for or purchase
         shares of, Fully Junior Shares) shall be declared or paid or set apart
         for payment or other distribution shall be declared or made or set
         apart for payment upon Junior Shares, nor shall any Junior Shares be
         redeemed, purchased or otherwise acquired (other than a redemption,
         purchase or other acquisition of Common Shares made for purposes of an
         employee incentive or benefit plan of the Trust or any subsidiary) for
         any consideration (or any moneys be paid to or made available for a
         sinking fund for the redemption of any Junior Shares) by the Trust,
         directly or indirectly (except by conversion into or exchange for Fully
         Junior Shares), unless in each case (i) the full cumulative dividends
         on all outstanding Series D Preferred Shares and any other Parity
         Shares of the Trust shall have been or contemporaneously are declared
         and paid or declared and set apart for payment for all past Dividend
         Periods with respect to the Series D Preferred Shares and all past
         dividend periods with respect to such Parity Shares and (ii) sufficient
         funds shall have been or contemporaneously are declared and paid or
         declared and set apart for the payment of the dividend for the current
         Dividend Period with respect to the Series D Preferred Shares and the
         current dividend period with respect to such Parity Shares.

                  (e) No distributions on Series D Preferred Shares shall be
         declared by the Board of Trustees or paid or set apart for payment by
         the Trust at such time as the terms and provisions of any agreement of
         the Trust, including any agreement relating to its indebtedness,
         prohibits such declaration, payment or setting apart for payment or
         provides that such declaration, payment or setting apart for payment
         would constitute a breach thereof or a default thereunder, or if such
         declaration or payment shall be restricted or prohibited by law.

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<PAGE>

                  (f) In determining whether a distribution by dividend,
         redemption or other acquisition of Shares or otherwise is permitted
         under Maryland law, no effect shall be given to amounts that would be
         needed, if the Trust were to be dissolved at the time of the
         distribution, to satisfy the preferential rights upon dissolution of
         shareholders whose preferential rights on dissolution are superior to
         those receiving the distribution.

         Section 4.        LIQUIDATION PREFERENCE.

                  (a) In the event of any liquidation, dissolution or winding up
         of the Trust, whether voluntary or involuntary, subject to the prior
         preferences and other rights of any series of shares of beneficial
         interest ranking senior to the Series D Preferred Shares of Beneficial
         Interest upon liquidation, distribution or winding up of the Trust,
         before any payment or distribution of the assets of the Trust (whether
         capital or surplus) shall be made to or set apart for the holders of
         Junior Shares, the holders of the Series D Preferred Shares shall be
         entitled to receive Twenty Six Dollars and Fifty Cents ($26.50) (the
         "Liquidation Preference") per Series D Preferred Share plus an amount
         equal to all dividends (whether or not earned or declared) accrued and
         unpaid thereon to the date of final distribution to such holders; but
         such holders shall not be entitled to any further payment; PROVIDED,
         that the dividend payable with respect to the Dividend Period
         containing the date of final distribution shall be equal to the greater
         of (i) the dividend provided in Section 3(a)(i) or (ii) the dividend
         determined pursuant to Section 3(a)(ii) for the preceding Dividend
         Period. If, upon any liquidation, dissolution or winding up of the
         Trust, the assets of the Trust, or proceeds thereof, distributable
         among the holders of the Series D Preferred Shares shall be
         insufficient to pay in full the preferential amount aforesaid and
         liquidating payments on any other shares of any class or series of
         Parity Shares, then such assets, or the proceeds thereof, shall be
         distributed among the holders of Series D Preferred Shares and any such
         other Parity Shares ratably in accordance with the respective amounts
         that would be payable on such Series D Preferred Shares and any such
         other Parity Shares if all amounts payable thereon were paid in full.
         For the purposes of this Section 4, (i) a consolidation or merger of
         the Trust with one or more corporations, real estate investment trusts
         or other entities, (ii) a sale, lease or conveyance of all or
         substantially all of the Trust's property or business or (iii) a
         statutory share exchange shall not be deemed to be a liquidation,
         dissolution or winding up, voluntary or involuntary, of the Trust.

                  (b) Subject to the rights of the holders of shares of any
         series or class or classes of shares of beneficial interest ranking on
         a parity with or prior to the Series D Preferred Shares upon
         liquidation, dissolution or winding up, upon any liquidation,
         dissolution or winding up of the Trust, after payment shall have been
         made in full to the holders of the Series D Preferred Shares, as
         provided in this Section 4, the holders of Series D Preferred Shares
         shall have no other claim to the remaining assets of the Trust and any
         other series or class or classes of Junior Shares shall, subject to the
         respective terms and provisions (if any) applying

                                      -9-
<PAGE>

         thereto, be entitled to receive any and all assets remaining to be paid
         or distributed, and the holders of the Series D Preferred Shares shall
         not be entitled to share therein.

         Section 5.        REDEMPTION AT THE OPTION OF THE TRUST.

                  (a) The Series D Preferred Shares shall not be redeemable by
         the Trust prior to December 29, 2005. On and after December 29, 2005,
         the Trust, at its option, may redeem the Series D Preferred Shares, in
         whole at any time or from time to time in part out of funds legally
         available therefor at a redemption price payable in cash equal to 100%
         of the Liquidation Preference per Series D Preferred Share (plus all
         accumulated, accrued and unpaid dividends as provided below).

                  (b) Upon any redemption of Series D Preferred Shares pursuant
         to this Section 5, the Trust shall pay all accrued and unpaid
         dividends, if any, thereon to the Call Date, without interest. If the
         Call Date falls after a dividend payment record date and prior to the
         corresponding Dividend Payment Date, then each holder of Series D
         Preferred Shares at the close of business on such dividend payment
         record date shall be entitled to the dividend payable on such shares on
         the corresponding Dividend Payment Date notwithstanding any redemption
         of such shares before such Dividend Payment Date. Except as provided
         above, the Trust shall make no payment or allowance for unpaid
         dividends, whether or not in arrears, on Series D Preferred Shares
         called for redemption.

                  (c) If full cumulative dividends on the Series D Preferred
         Shares and any other class or series of Parity Shares of the Trust have
         not been declared and paid or declared and set apart for payment, the
         Series D Preferred Shares may not be redeemed under this Section 5 in
         part and the Trust may not purchase or acquire Series D Preferred
         Shares, otherwise than pursuant to a purchase or exchange offer made on
         the same terms to all holders of Series D Preferred Shares.

                  (d) Notice of the redemption of any Series D Preferred Shares
         under this Section 5 shall be mailed by first-class mail to each holder
         of record of Series D Preferred Shares to be redeemed at the address of
         each such holder as shown on the Trust's records, not less than 30 nor
         more than 90 days prior to the Call Date. Neither the failure to mail
         any notice required by this paragraph (d), nor any defect therein or in
         the mailing thereof, to any particular holder, shall affect the
         sufficiency of the notice or the validity of the proceedings for
         redemption with respect to the other holders. Each such mailed notice
         shall state, as appropriate: (1) the Call Date; (2) the number of
         Series D Preferred Shares to be redeemed and, if fewer than all the
         shares held by such holder are to be redeemed, the number of such
         shares to be redeemed from such holder; (3) the redemption price; (4)
         the place or places at which certificates for such shares are to be
         surrendered; (5) the then-current Conversion Price; and (6) that
         dividends on the shares to be redeemed shall cease to accrue on such
         Call Date except as otherwise provided herein. Notice having been
         mailed as aforesaid, from and

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         after the Call Date (unless the Trust shall fail to make available an
         amount of cash necessary to effect such redemption), (i) except as
         otherwise provided herein, dividends on the Series D Preferred Shares
         so called for redemption shall cease to accrue, (ii) such shares shall
         no longer be deemed to be outstanding, and (iii) all rights of the
         holders thereof as holders of Series D Preferred Shares shall cease
         (except the rights to convert and to receive the cash payable upon such
         redemption, without interest thereon, upon surrender and endorsement of
         their certificates if so required and to receive any dividends payable
         thereon). The Trust's obligation to provide cash in accordance with the
         preceding sentence shall be deemed fulfilled if, on or before the Call
         Date, the Trust shall deposit with a bank or trust company (which may
         be an affiliate of the Trust) that has an office in the Borough of
         Manhattan, City of New York, and that has, or is an affiliate of a bank
         or trust company that has, capital and surplus of at least $50,000,000,
         such amount of cash as is necessary for such redemption, in trust, with
         irrevocable instructions that such cash be applied to the redemption of
         the Series D Preferred Shares so called for redemption. No interest
         shall accrue for the benefit of the holders of Series D Preferred
         Shares to be redeemed on any cash so set aside by the Trust. Subject to
         applicable escheat laws, any such cash unclaimed at the end of two
         years from the Call Date shall revert to the general funds of the
         Trust, after which reversion the holders of such shares so called for
         redemption shall look only to the general funds of the Trust for the
         payment of such cash.

                  As promptly as practicable after the surrender in accordance
         with such notice of the certificates for any such shares so redeemed
         (properly endorsed or assigned for transfer, if the Trust shall so
         require and if the notice shall so state), such shares shall be
         exchanged for any cash (without interest thereon) for which such shares
         have been redeemed. If fewer than all the outstanding Series D
         Preferred Shares are to be redeemed, shares to be redeemed shall be
         selected by the Trust from outstanding Series D Preferred Shares not
         previously called for redemption pro rata (as nearly as may be), by lot
         or by any other method determined by the Trust in its sole discretion
         to be equitable. If fewer than all the Series D Preferred Shares
         evidenced by any certificate are redeemed, then new certificates
         evidencing the unredeemed shares shall be issued without cost to the
         holder thereof.

                  (f) Subject to any waivers of the Ownership Limit granted by
         the Board of Trustees, nothing in this Section 5 shall restrict the
         Trust's right to purchase Shares-in-Trust pursuant to Article VII,
         Section 2(G) of the Declaration.

         Section 6.        CONVERSION. Holders of Series D Preferred Shares
         shall have the right to convert all or a portion of such shares into
         Common Shares, as follows:

                  (a) Subject to and upon compliance with the provisions of this
         Section 6, a holder of Series D Preferred Shares shall have the right,
         at his or her option, at any time after the earliest to occur of (i)
         the sixty first day after such holder provides the Trust with written
         notice of its intent to convert Series D Preferred Shares, (ii) the
         first day on which a Change

                                      -11-
<PAGE>

         of Control occurs, (iii) the occurrence of a REIT Termination Event, or
         (iv) such date as determined by the Trust (the "Conversion Date"), to
         convert all or any portion of such shares (or such shares as determined
         by the Trust if pursuant to clause (iv) above) into the number of fully
         paid and non-assessable Common Shares obtained by dividing the
         aggregate Liquidation Preference of such shares (inclusive of accrued
         but unpaid dividends) by the Conversion Price (as in effect at the time
         and on the date provided for in the last paragraph of paragraph (b) of
         this Section 6) by surrendering such shares to be converted, such
         surrender to be made in the manner provided in paragraph (b) of this
         Section 6; PROVIDED, HOWEVER, that the right to convert shares called
         for redemption pursuant to Section 5 shall terminate at the close of
         business on the fifth Business Day prior to the Call Date fixed for
         such redemption, unless the Trust shall default in making payment of
         the cash payable upon such redemption under Section 5.

                  (b) In order to exercise the conversion right, the holder of
         each Series D Preferred Share to be converted shall surrender the
         certificate representing such share, duly endorsed or assigned to the
         Trust or in blank, at the office of the Transfer Agent, accompanied by
         written notice to the Trust that the holder thereof irrevocably elects
         to convert such Series D Preferred Shares. Unless the shares issuable
         on conversion are to be issued in the same name as the name in which
         such Series D Preferred Share is registered, each share surrendered for
         conversion shall be accompanied by instruments of transfer, in form
         satisfactory to the Trust, duly executed by the holder or such holder's
         duly authorized attorney and an amount sufficient to pay any transfer
         or similar tax (or evidence reasonably satisfactory to the Trust
         demonstrating that such taxes have been paid).

                  Holders of Series D Preferred Shares at the close of business
         on a dividend payment record date shall be entitled to receive the
         dividend payable on such shares on the corresponding Dividend Payment
         Date notwithstanding the conversion thereof following such dividend
         payment record date and prior to such Dividend Payment Date. However,
         Series D Preferred Shares surrendered for conversion during the period
         between the close of business on any dividend payment record date and
         the opening of business on the corresponding Dividend Payment Date
         (except shares converted after the issuance of notice of redemption
         with respect to a Call Date during such period, such Series D Preferred
         Shares being entitled to such dividend on the Dividend Payment Date)
         must be accompanied by payment of an amount equal to the dividend
         payable on such shares on such Dividend Payment Date. A holder of
         Series D Preferred Shares on a dividend payment record date who (or
         whose transferee) tenders any such shares for conversion into Common
         Shares on the corresponding Dividend Payment Date will receive the
         dividend payable by the Trust on such Series D Preferred Shares on such
         date, and the converting holder need not include payment of the amount
         of such dividend upon surrender of Series D Preferred Shares for
         conversion. Except as provided above, the Trust shall make no payment
         or allowance for unpaid dividends, whether or not in arrears, on
         converted shares or for dividends on the Common Shares issued upon such
         conversion.

                                      -12-
<PAGE>

                  As promptly as practicable after the surrender of certificates
         for Series D Preferred Shares as aforesaid, the Trust shall issue and
         shall deliver at such office to such holder, or on his or her written
         order, a certificate or certificates for the number of full Common
         Shares issuable upon the conversion of such shares in accordance with
         provisions of this Section 6, and any fractional interest in respect of
         a Common Share arising upon such conversion shall be settled as
         provided in paragraph (c) of this Section 6.

                  Each conversion shall be deemed to have been effected
         immediately prior to the close of business on the date on which the
         certificates for Series D Preferred Shares shall have been surrendered
         and such notice shall have been received by the Trust as aforesaid (and
         if applicable, payment of an amount equal to the dividend payable on
         such shares shall have been received by the Trust as described above),
         and the person or persons in whose name or names any certificate or
         certificates for Common Shares shall be issuable upon such conversion
         shall be deemed to have become the holder or holders of record of the
         shares represented thereby at such time on such date and such
         conversion shall be at the Conversion Price in effect at such time on
         such date unless the share transfer books of the Trust shall be closed
         on that date, in which event such person or persons shall be deemed to
         have become such holder or holders of record at the close of business
         on the next succeeding day on which such share transfer books are open,
         but such conversion shall be at the Conversion Price in effect on the
         date on which such shares shall have been surrendered and such notice
         received by the Trust.

                  (c) No fractional shares or scrip representing fractions of
         Common Shares shall be issued upon conversion of the Series D Preferred
         Shares. Instead of any fractional interest in a Common Share that would
         otherwise be deliverable upon the conversion of a Series D Preferred
         Share, the Trust shall pay to the holder of such share an amount in
         cash based upon the Current Market Price of the Common Shares on the
         Trading Day immediately preceding the date of conversion. If more than
         one share shall be surrendered for conversion at one time by the same
         holder, the number of full Common Shares issuable upon conversion
         thereof shall be computed on the basis of the aggregate number of
         Series D Preferred Shares so surrendered.

                  (d) The Conversion Price shall be adjusted from time to time
         as follows:

                           (i) If the Trust shall after the Issue Date (A) pay a
                  dividend or make a distribution on its shares of beneficial
                  interest in Common Shares, (B) subdivide its outstanding
                  Common Shares into a greater number of shares, (C) combine its
                  outstanding Common Shares into a smaller number of shares or
                  (D) issue any shares of beneficial interest by
                  reclassification of its Common Shares, the Conversion Price in
                  effect at the opening of business on the day following the
                  date fixed for the determination of shareholders entitled to
                  receive such dividend or distribution or at

                                      -13-
<PAGE>

                  the opening of business on the Business Day next following the
                  day on which such subdivision, combination or reclassification
                  becomes effective, as the case may be, shall be adjusted so
                  that the holder of any Series D Preferred Share thereafter
                  surrendered for conversion shall be entitled to receive the
                  number of Common Shares that such holder would have owned or
                  have been entitled to receive after the happening of any of
                  the events described above as if such Series D Preferred
                  Shares had been converted immediately prior to the record date
                  in the case of a dividend or distribution or the effective
                  date in the case of a subdivision, combination or
                  reclassification. An adjustment made pursuant to this
                  subparagraph (i) shall become effective immediately after the
                  opening of business on the Business Day next following the
                  record date (except as provided in paragraph (h) below) in the
                  case of a dividend or distribution and shall become effective
                  immediately after the opening of business on the Business Day
                  next following the effective date in the case of a
                  subdivision, combination or reclassification.

                           (ii) If the Trust shall issue after the Issue Date
                  rights, options or warrants to all holders of Common Shares
                  entitling them (for a period expiring within 45 days after the
                  record date mentioned below) to subscribe for or purchase
                  Common Shares at a price per share less than 95% (100% if a
                  stand-by underwriter is used and charges the Trust a
                  commission) of the Fair Market Value per Common Share on the
                  record date for the determination of shareholders entitled to
                  receive such rights, options or warrants, then the Conversion
                  Price in effect at the opening of business on the Business Day
                  next following such record date shall be adjusted to equal the
                  price determined by multiplying (A) the Conversion Price in
                  effect immediately prior to the opening of business on the
                  Business Day next following the date fixed for such
                  determination by (B) a fraction, the numerator of which shall
                  be the sum of (x) the number of Common Shares outstanding on
                  the close of business on the date fixed for such determination
                  and (y) the number of shares that the aggregate proceeds to
                  the Trust from the exercise of such rights, options or
                  warrants for Common Shares would purchase at 95% of such Fair
                  Market Value (or 100% in the case of a stand-by underwriting),
                  and the denominator of which shall be the sum of (x) the
                  number of Common Shares outstanding on the close of business
                  on the date fixed for such determination and (y) the number of
                  additional Common Shares offered for subscription or purchase
                  pursuant to such rights, options or warrants. Such adjustment
                  shall become effective immediately after the opening of
                  business on the day next following such record date (except as
                  provided in paragraph (h) below). In determining whether any
                  rights, options or warrants entitle the holders of Common
                  Shares to subscribe for or purchase Common Shares at less than
                  95% of such Fair Market Value (or 100% in the case of a
                  stand-by underwriting), there shall be taken into account any
                  consideration received by the Trust upon issuance and upon
                  exercise of such rights, options or warrants, the value of
                  such consideration, if other

                                      -14-
<PAGE>

                  than cash, to be determined by the Board of Trustees whose
                  determination shall be conclusive.

                           (iii) If the Trust shall distribute to all holders of
                  its Common Shares any securities of the Trust (other than
                  Common Shares) or evidence of its indebtedness or assets
                  (excluding cumulative cash dividends or distributions paid
                  with respect to the Common Shares after December 31, 2000
                  which are not in excess of the following: the sum of (A) the
                  Trust's cumulative undistributed Funds from Operations at
                  December 31, 2000, plus (B) the cumulative amount of Funds
                  from Operations, as determined by the Board of Trustees, after
                  December 31, 2000, minus (C) the cumulative amount of
                  dividends accrued or paid in respect of the Series D Preferred
                  Shares or any other class or series of preferred shares of
                  beneficial interest of the Trust after the Issue Date or
                  rights, options or warrants to subscribe for or purchase any
                  of its securities (excluding those rights, options and
                  warrants issued to all holders of Common Shares entitling them
                  for a period expiring within 45 days after the record date
                  referred to in subparagraph (ii) above to subscribe for or
                  purchase Common Shares, which rights and warrants are referred
                  to in and treated under subparagraph (ii) above) (any of the
                  foregoing being hereinafter in this subparagraph (iii)
                  collectively called the "SECURITIES" and individually a
                  "SECURITY"), then in each such case the Conversion Price shall
                  be adjusted so that it shall equal the price determined by
                  multiplying (x) the Conversion Price in effect immediately
                  prior to the close of business on the date fixed for the
                  determination of shareholders entitled to receive such
                  distribution by (y) a fraction, the numerator of which shall
                  be the Fair Market Value per Common Share on the record date
                  mentioned below less the then fair market value (as determined
                  by the Board of Trustees, whose determination shall be
                  conclusive) of the portion of the Securities or assets or
                  evidences of indebtedness so distributed or of such rights,
                  options or warrants applicable to one Common Share, and the
                  denominator of which shall be the Fair Market Value per Common
                  Share on the record date mentioned below. Such adjustment
                  shall become effective immediately at the opening of business
                  on the Business Day next following (except as provided in
                  paragraph (h) below) the record date for the determination of
                  shareholders entitled to receive such distribution. For the
                  purposes of this subparagraph (iii), the distribution of a
                  Security, which is distributed not only to the holders of the
                  Common Shares on the date fixed for the determination of
                  shareholders entitled to such distribution of such Security,
                  but also is distributed with each Common Share delivered to a
                  Person converting a Series D Preferred Share after such
                  determination date, shall not require an adjustment of the
                  Conversion Price pursuant to this subparagraph (iii); PROVIDED
                  that on the date, if any, on which a person converting a
                  Series D Preferred Share would no longer be entitled to
                  receive such Security with a Common Share (other than as a
                  result of the termination of all such Securities), a
                  distribution of such Securities shall be deemed to have
                  occurred and the Conversion Price shall be adjusted as
                  provided in this

                                      -15-
<PAGE>

                  subparagraph (iii) (and such day shall be deemed to be "the
                  date fixed for the determination of the shareholders entitled
                  to receive such distribution" and "the record date" within the
                  meaning of the two preceding sentences).

                           (iv) In case a tender or exchange offer (which term
                  shall not include open market repurchases by the Trust) made
                  by the Trust or any subsidiary of the Trust for all or any
                  portion of the Common Shares shall expire and such tender or
                  exchange offer shall involve the payment by the Trust or such
                  subsidiary of consideration per Common Share having a fair
                  market value (as determined in good faith by the Board of
                  Trustees, whose determination shall be conclusive and
                  described in a resolution of the Board of Trustees), at the
                  last time (the "EXPIRATION TIME") tenders or exchanges may be
                  made pursuant to such tender or exchange offer, that exceeds
                  the Current Market Price per Common Share on the Trading Day
                  next succeeding the Expiration Time, the Conversion Price
                  shall be reduced so that the same shall equal the price
                  determined by multiplying the Conversion Price in effect
                  immediately prior to the effectiveness of the Conversion Price
                  reduction contemplated by this subparagraph, by a fraction of
                  which the numerator shall be the number of Common Shares
                  outstanding (including any tendered or exchanged shares) at
                  the Expiration Time, multiplied by the Current Market Price
                  per Common Share on the Trading Day next succeeding the
                  Expiration Time, and the denominator shall be the sum of (A)
                  the fair market value (determined as aforesaid) of the
                  aggregate consideration payable to shareholders based upon the
                  acceptance (up to any maximum specified in the terms of the
                  tender or exchange offer) of all shares validly tendered or
                  exchanged and not withdrawn as of the Expiration Time (the
                  shares deemed so accepted, up to any maximum, being referred
                  to as the "PURCHASED SHARES") and (B) the product of the
                  number of Common Shares outstanding (less any Purchased
                  Shares) at the Expiration Time and the Current Market Price
                  per Common Share on the Trading Day next succeeding the
                  Expiration Time, such reduction to become effective
                  immediately prior to the opening of business on the day
                  following the Expiration Time.

                           (v) No adjustment in the Conversion Price shall be
                  required unless such adjustment would require a cumulative
                  increase or decrease of at least 1% in such price; PROVIDED,
                  HOWEVER, that any adjustments that by reason of this
                  subparagraph (v) are not required to be made shall be carried
                  forward and taken into account in any subsequent adjustment
                  until made; and PROVIDED, FURTHER, that any adjustment shall
                  be required and made in accordance with the provisions of this
                  Section 6 (other than this subparagraph (v)) not later than
                  such time as may be required in order to preserve the tax-free
                  nature of a distribution to the holders of Common Shares.
                  Notwithstanding any other provisions of this Section 6, the
                  Trust shall not be required to make any adjustment of the
                  Conversion Price for the issuance of any Common Shares
                  pursuant to any plan providing for the reinvestment of
                  dividends or

                                      -16-
<PAGE>

                  interest payable on securities of the Trust and the investment
                  of additional optional amounts in Common Shares under such
                  plan. All calculations under this Section 6 shall be made to
                  the nearest cent (with $.005 being rounded upward) or to the
                  nearest one-tenth of a share (with .05 of a share being
                  rounded upward), as the case may be. Anything in this
                  paragraph (d) to the contrary notwithstanding, the Trust shall
                  be entitled, to the extent permitted by law, to make such
                  reductions in the Conversion Price, in addition to those
                  required by this paragraph (d), as it in its discretion shall
                  determine to be advisable in order that any share dividends,
                  subdivision of shares, reclassification or combination of
                  shares, distribution of rights or warrants to purchase shares
                  or securities, or distribution of other assets (other than
                  cash dividends) hereafter made by the Trust to its
                  shareholders shall not be taxable.

                  (e) If the Trust shall be a party to any transaction
         (including without limitation a merger, consolidation, statutory share
         exchange, self tender offer for all or substantially all of its Common
         Shares, sale of all or substantially all of the Trust's assets or
         recapitalization of the Common Shares and excluding any transaction as
         to which subparagraph (d)(i) of this Section 6 applies) (each of the
         foregoing being referred to herein as a "TRANSACTION"), in each case as
         a result of which all or substantially all of the Common Shares are
         converted into the right to receive shares, securities or other
         property (including cash or any combination thereof), each Series D
         Preferred Share which is not redeemed or converted into the right to
         receive shares, securities or other property prior to such Transaction
         shall thereafter be convertible into the kind and amount of shares,
         securities and other property (including cash or any combination
         thereof) receivable upon the consummation of such Transaction by a
         holder of that number of Common Shares into which one Series D
         Preferred Share was convertible immediately prior to such Transaction,
         assuming such holder of Common Shares (i) is not a Person with which
         the Trust consolidated or into which the Trust merged or which merged
         into the Trust or to which such sale or transfer was made, as the case
         may be ("CONSTITUENT PERSON"), or an affiliate of a Constituent Person
         and (ii) failed to exercise his rights of election, if any, as to the
         kind or amount of shares, securities and other property (including
         cash) receivable upon such Transaction (provided that if the kind or
         amount of shares, securities and other property (including cash)
         receivable upon such Transaction is not the same for each Common Share
         held immediately prior to such Transaction by other than a Constituent
         Person or an affiliate thereof and in respect of which such rights of
         election shall not have been exercised ("NON-ELECTING SHARE"), then for
         the purpose of this paragraph (e) the kind and amount of shares,
         securities and other property (including cash) receivable upon such
         Transaction by each Non-Electing Share shall be deemed to be the kind
         and amount so receivable per share by holders of a plurality of the
         Non-Electing Shares). The Trust shall not be a party to any Transaction
         unless the terms of such Transaction are consistent with the provisions
         of this paragraph (e), and it shall not consent or agree to the
         occurrence of any Transaction until the Trust has entered into an
         agreement with the successor or purchasing entity, as the case may be,
         for the benefit of the holders of the Series D Preferred Shares that
         will contain provisions enabling the holders of the Series D Preferred

                                      -17-
<PAGE>

         Shares that remain outstanding after such Transaction to convert into
         the consideration received by holders of Common Shares at the
         Conversion Price in effect immediately prior to such Transaction. The
         provisions of this paragraph (e) shall similarly apply to successive
         Transactions.

                  (f)      If:

                           (i) the Trust shall declare a dividend (or any other
                  distribution) on its Common Shares (other than cash dividends
                  or distributions paid with respect to the Common Shares after
                  December 31, 2000 not in excess of the sum of the Trust's
                  cumulative undistributed Funds from Operations at December 31,
                  2000, plus the cumulative amount of Funds from Operations, as
                  determined by the Board of Trustees, after December 31, 2000,
                  minus the cumulative amount of dividends accrued or paid in
                  respect of the Series D Preferred Shares or any other class or
                  series of preferred shares of beneficial interest of the Trust
                  after the Issue Date); or

                           (ii) the Trust shall authorize the granting to all
                  holders of Common Shares of rights, options or warrants to
                  subscribe for or purchase any shares of any class or any other
                  rights, options or warrants; or

                           (iii) there shall be any reclassification of the
                  Common Shares (other than an event to which subparagraph
                  (d)(i) of this Section 6 applies) or any consolidation or
                  merger to which the Trust is a party (other than a merger in
                  which the Trust is the surviving entity) and for which
                  approval of any shareholders of the Trust is required, or a
                  statutory share exchange, or a self tender offer by the Trust
                  for all or substantially all of its outstanding Common Shares
                  or the sale or transfer of all or substantially all of the
                  assets of the Trust as an entirety; or

                           (iv) there shall occur the voluntary or involuntary
                  liquidation, dissolution or winding up of the Trust;

         then the Trust shall cause to be filed with the Transfer Agent and
         shall cause to be mailed to the holders of Series D Preferred Shares at
         their addresses as shown on the records of the Trust, as promptly as
         possible, but at least 10 days prior to the applicable date hereinafter
         specified, a notice stating (A) the date on which a record is to be
         taken for the purpose of such dividend, distribution or granting of
         rights, options or warrants, or, if a record is not to be taken, the
         date as of which the holders of Common Shares of record to be entitled
         to such dividend, distribution or rights, options or warrants are to be
         determined or (B) the date on which such reclassification,
         consolidation, merger, statutory share exchange, sale, transfer,
         liquidation, dissolution or winding up is expected to become effective,
         and the date as of which it is expected that holders of Common Shares
         of record shall be entitled to exchange their Common Shares for
         securities or other property, if any, deliverable upon such

                                      -18-
<PAGE>

         reclassification, consolidation, merger, statutory share exchange,
         sale, transfer, liquidation, dissolution or winding up. Failure to give
         or receive such notice or any defect therein shall not affect the
         legality or validity of the proceedings described in this Section 6.

                  (g) Whenever the Conversion Price is adjusted as herein
         provided, the Trust shall promptly file with the Transfer Agent an
         officer's certificate setting forth the Conversion Price after such
         adjustment and setting forth a brief statement of the facts requiring
         such adjustment which certificate shall be conclusive evidence of the
         correctness of such adjustment absent manifest error. Promptly after
         delivery of such certificate, the Trust shall prepare a notice of such
         adjustment of the Conversion Price setting forth the adjusted
         Conversion Price and the effective date of such adjustment and shall
         mail such notice of such adjustment of the Conversion Price to the
         holder of each Series D Preferred Share at such holder's last address
         as shown on the records of the Trust.

                  (h) In any case in which paragraph (d) of this Section 6
         provides that an adjustment shall become effective on the day next
         following the record date for an event, the Trust may defer until the
         occurrence of such event (A) issuing to the holder of any Series D
         Preferred Share converted after such record date and before the
         occurrence of such event the additional Common Shares issuable upon
         such conversion by reason of the adjustment required by such event over
         and above the Common Shares issuable upon such conversion before giving
         effect to such adjustment and (B) paying to such holder any amount of
         cash in lieu of any fraction pursuant to paragraph (c) of this Section
         6.

                  (i) There shall be no adjustment of the Conversion Price in
         case of the issuance of any shares of beneficial interest of the Trust
         in a reorganization, acquisition or other similar transaction except as
         specifically set forth in this Section 6. If any action or transaction
         would require adjustment of the Conversion Price pursuant to more than
         one paragraph of this Section 6, only one adjustment shall be made and
         such adjustment shall be the amount of adjustment that has the highest
         absolute value.

                  (j) If the Trust shall take any action affecting the Common
         Shares, other than action described in this Section 6, that in the
         opinion of the Board of Trustees would materially and adversely affect
         the conversion rights of the holders of the Series D Preferred Shares,
         the Conversion Price for the Series D Preferred Shares may be adjusted,
         to the extent permitted by law, in such manner, if any, and at such
         time, as the Board of Trustees, in its sole discretion, may determine
         to be equitable in the circumstances.

                                      -19-
<PAGE>

                  (k) The Trust covenants that it will at all times reserve and
         keep available, free from preemptive rights, out of the aggregate of
         its authorized but unissued Common Shares, for the purpose of effecting
         conversion of the Series D Preferred Shares, the full number of Common
         Shares deliverable upon the conversion of all outstanding Series D
         Preferred Shares not theretofore converted. For purposes of this
         paragraph (k), the number of Common Shares that shall be deliverable
         upon the conversion of all outstanding Series D Preferred Shares shall
         be computed as if at the time of computation all such outstanding
         shares were held by a single holder.

                           Any Common Shares issued upon conversion of the
         Series D Preferred Shares shall be validly issued, fully paid and
         non-assessable. Before taking any action that would cause an adjustment
         reducing the Conversion Price below the then-par value of the Common
         Shares deliverable upon conversion of the Series D Preferred Shares,
         the Trust will take any action that, in the opinion of its counsel, may
         be necessary in order that the Trust may validly and legally issue
         fully paid and (subject to any customary qualification based upon the
         nature of a real estate investment trust) non-assessable Common Shares
         at such adjusted Conversion Price.

                           The Trust shall endeavor to list the Common Shares
         required to be delivered upon conversion of the Series D Preferred
         Shares, prior to such delivery, upon each national securities exchange,
         if any, upon which the outstanding Common Shares are listed at the time
         of such delivery.

                           The Trust shall endeavor to comply with all federal
         and state securities laws and regulations thereunder in connection with
         the issuance of any securities that the Trust shall be obligated to
         deliver upon conversion of the Series D Preferred Shares. The
         certificates evidencing such securities shall bear such legends
         restricting transfer thereof in the absence of registration under
         applicable securities laws or an exemption therefrom as the Trust may
         in good faith deem appropriate.

                  (l) The Trust will pay any and all documentary stamp or
         similar issue or transfer taxes payable in respect of the issue or
         delivery of Common Shares or other securities or property on conversion
         of the Series D Preferred Shares pursuant hereto; PROVIDED, HOWEVER,
         that the Trust shall not be required to pay any tax that may be payable
         in respect of any transfer involved in the issue or delivery of Common
         Shares or other securities or property in a name other than that of the
         holder of the Series D Preferred Shares to be converted, and no such
         issue or delivery shall be made unless and until the person requesting
         such issue or delivery has paid to the Trust the amount of any such tax
         or established, to the reasonable satisfaction of the Trust, that such
         tax has been paid.

                                      -20-
<PAGE>

         Section 7.        Fixed Charge Coverage; Limitation on Issuance of
         Additional Preferred Shares and Indebtedness

                  (a) Without the written consent of the holders of a majority
         of the issued and outstanding shares of Series D Preferred Shares, none
         of the Trust, the Operating Partnership or any of their subsidiaries
         may issue any additional preferred securities of any such entity or
         incur any indebtedness (other than trade payables or accrued expenses
         incurred in the ordinary course of business) if, immediately following
         such issuance and after giving effect to such issuance and the
         application of the net proceeds therefrom, the Trust's Consolidated
         EBITDA to Consolidated Fixed Charges for the four fiscal quarters
         immediately preceding such issuance would be less than 1.75 to 1.0.

                  (b) "Consolidated EBITDA" for any period means the sum of the
         following items, without duplication, as reported in the Trust's
         consolidated financial statements filed with the Securities and
         Exchange Commission (or, where applicable, in the consolidated
         financial statements of the Trust's Unconsolidated Affiliates), in each
         case prepared in accordance with GAAP:

                  a.       the net income of the Trust and its Consolidated
                           Affiliates for such period, before extraordinary
                           income, gains or losses.

                  b.       PLUS all income and state franchise taxes paid or
                           accrued by the Trust and its Consolidated Affiliates
                           for such period (other than income taxes attributable
                           to extraordinary, unusual or non-recurring gains or
                           losses except to the extent that such gains or losses
                           were not included in clause (a) above).

                  c.       PLUS the Trust's proportionate share of all income
                           and state franchise taxes paid or accrued by the
                           Trust's Unconsolidated Affiliates for such period
                           (other than income taxes attributable to
                           extraordinary, unusual or non-recurring gains or
                           losses except to the extent that such gains or losses
                           were not included in clause (a) above).

                  d.       PLUS all interest expense paid or accrued by the
                           Trust and its Consolidated Affiliates for such period
                           (including financing fees and amortization of
                           deferred financing fees or amortization of original
                           issue discount). Such interest shall also include
                           non-recurring items such as pre-payment penalties,
                           make-whole premiums, accelerated amortization of
                           financing costs due to early termination and costs of
                           unwinding interest rate hedging contracts. All such
                           interest will be calculated net of the impact of
                           continuing interest rate hedging agreements.

                  e.       PLUS the Trust's proportionate share of all interest
                           expense paid or accrued by the Trust's Unconsolidated
                           Affiliates for such period (including financing

                                      -21-
<PAGE>

                           fees and amortization of deferred financing fees or
                           amortization of original issue discount). Such
                           interest shall also include non-recurring items such
                           as pre-payment penalties, make-whole premiums,
                           accelerated amortization of financing costs due to
                           early termination and costs of unwinding interest
                           rate hedging contracts. All such interest will be
                           calculated net of the impact of continuing interest
                           rate hedging agreements.

                  f.       PLUS depreciation and depletion recognized by the
                           Trust and its Consolidated Affiliates during such
                           period.

                  g.       PLUS the Trust's proportionate share of depreciation
                           and depletion recognized by the Trust's
                           Unconsolidated Affiliates during such period.

                  h.       PLUS amortization recognized by the Trust and its
                           Consolidated Affiliates during such period,
                           including, without limitation, amortization of
                           capitalized debt issuance costs (only to the extent
                           that such amounts have not been previously included
                           in the amount of Consolidated EBITDA pursuant to
                           clause (d) above), goodwill, other intangibles and
                           management fees.

                  i.       PLUS the Trust's proportionate share of amortization
                           recognized by the Trust's Unconsolidated Affiliates
                           during such period, including, without limitation,
                           amortization of capitalized debt issuance costs (only
                           to the extent that such amounts have not been
                           previously included in the amount of Consolidated
                           EBITDA pursuant to clause (e) above), goodwill, other
                           intangibles and management fees.

                  j.       PLUS any other non-cash charges or discretionary
                           prepayment penalties recognized by the Trust and its
                           Consolidated Affiliates during such period, to the
                           extent deducted from consolidated net income
                           (including, but not limited to, income allocated to
                           minority interests).

                  k.       PLUS the Trust's proportionate share of any other
                           non-cash charges or discretionary prepayment
                           penalties recognized by the Trust's Unconsolidated
                           Affiliates during such period, to the extent deducted
                           from consolidated net income (including, but not
                           limited to, income allocated to minority interests).

                  l.       MINUS (PLUS) the amount of any gains (losses) on
                           sales of real property recognized by the Trust and
                           its Consolidated Affiliates during such period.

                  m.       MINUS (PLUS) the Trust's proportionate share of the
                           amount of any gains (losses) on sales of real
                           property recognized by the Trust's Unconsolidated
                           Affiliates during such period.

                                      -22-
<PAGE>

                  (c) "Consolidated Fixed Charges" for any period means the sum
         of the following items, without duplication, as reported in the Trust's
         consolidated financial statements filed with the Securities and
         Exchange Commission (or, where applicable, in the consolidated
         financial statements of the Trust's Unconsolidated Affiliates), in each
         case, prepared in accordance with GAAP:

                  a.       all interest expense paid or accrued by the Trust and
                           its Consolidated Affiliates for such period
                           (including financing fees and amortization of
                           deferred financing fees or amortization of original
                           issue discount), but excluding non-recurring items
                           such as pre-payment penalties, make-whole premiums,
                           accelerated amortization of financing costs due to
                           early termination and costs of unwinding interest
                           rate hedging contracts.

                  b.       PLUS the Trust's proportionate share of all interest
                           expense paid or accrued by the Trust's Unconsolidated
                           Affiliates for such period (including financing fees
                           and amortization of deferred financing fees or
                           amortization of original issue discount), but
                           excluding non-recurring items such as pre-payment
                           penalties, make-whole premiums, accelerated
                           amortization of financing costs due to early
                           termination and costs of unwinding interest rate
                           hedging contracts.

                  c.       PLUS dividend or distribution requirements on
                           preferred stock for the Trust and its Consolidated
                           Affiliates for such period, whether or not declared
                           or paid.

                  d.       PLUS the Trust's proportionate share of dividend or
                           distribution requirements on preferred stock for the
                           Trust's Unconsolidated Affiliates for such period,
                           whether or not declared or paid.

                  e.       PLUS regularly scheduled amortization of principal
                           for the Trust and its Consolidated Affiliates during
                           such period (other than any balloon payments at
                           maturity).

                  f.       PLUS the Trust's proportionate share of regularly
                           scheduled amortization of principal for the Trust's
                           Unconsolidated Affiliates during such period (other
                           than any balloon payments at maturity).

         Section 8. SHARES TO BE RETIRED. All Series D Preferred Shares which
shall have been issued and reacquired in any manner by the Trust shall be
restored to the status of authorized but unissued preferred shares of beneficial
interest, without discretion as to class or series, and subject

                                      -23-
<PAGE>

to applicable limitations set forth in the Declaration may thereafter be
reissued as shares of any series of preferred shares of beneficial interest.

         Section 9. RANKING. Any class or series of shares of beneficial
interest of the Trust shall be deemed to rank:

                  (a) prior to the Series D Preferred Shares, as to the payment
         of dividends and as to distribution of assets upon liquidation,
         dissolution or winding up, if the holders of such class or series shall
         be entitled to the receipt of dividends or of amounts distributable
         upon liquidation, dissolution or winding up, as the case may be, in
         preference or priority to the holders of Series D Preferred Shares;

                  (b) on a parity with the Series D Preferred Shares, as to the
         payment of dividends and as to distribution of assets upon liquidation,
         dissolution or winding up, whether or not the dividend rates, dividend
         payment dates or redemption or liquidation prices per share thereof
         shall be different from those of the Series D Preferred Shares, if the
         holders of such class or series and the Series D Preferred Shares shall
         be entitled to the receipt of dividends and of amounts distributable
         upon liquidation, dissolution or winding up in proportion to their
         respective amounts of accrued and unpaid dividends per share or
         liquidation preferences, without preference or priority one over the
         other ("PARITY SHARES");

                  (c) junior to the Series D Preferred Shares, as to the payment
         of dividends or as to the distribution of assets upon liquidation,
         dissolution or winding up, if such class or series shall be Junior
         Shares; and

                  (d) junior to the Series D Preferred Shares, as to the payment
         of dividends and as to the distribution of assets upon liquidation,
         dissolution or winding up, if such class or series shall be Fully
         Junior Shares.

         Section 10. VOTING. Except as expressly provided in these Articles
Supplementary, the holders of Series D Preferred Shares shall have no voting
rights. If and whenever (i) two consecutive quarterly dividends payable on the
Series D Preferred Shares shall be in arrears (which shall, with respect to any
such quarterly dividend, mean that any such dividend has not been paid in full),
whether or not earned or declared, (ii) for two consecutive quarterly dividend
periods the Trust fails to pay dividends on the Common Shares in an amount per
share at least equal to $0.38 (subject to adjustment consistent with any
adjustment of the Conversion Price pursuant to Section 6(a) of this Article) or
(iii) for two consecutive quarters the Trust fails to maintain a ratio of
Consolidated EBITDA to Consolidated Fixed Charges of at least 1.75, then the
number of trustees then constituting the Board of Trustees shall be increased by
two and the holders of Series D Preferred Shares, voting as a single class,
shall be entitled to elect the two additional trustees to serve on the Board of
Trustees at any annual meeting of shareholders or special meeting held in place
thereof, or at a special meeting of the holders of the Series D Preferred Shares
called as hereinafter provided.

                                      -24-
<PAGE>

Whenever, as the case may be, (i) all arrears in dividends on the Series D
Preferred Shares then outstanding shall have been paid and the Trust has paid
dividends thereon for two consecutive quarters, (ii) the Trust has paid
dividends on the Common Shares in an amount per share at least equal to $0.38
(subject to adjustment consistent with any adjustment of the Conversion Price
pursuant to Section 6(a) of this Article) for two consecutive quarters or (iii)
the Trust has maintained a ratio of Consolidated EBITDA to Consolidated Fixed
Charges of at least 1.75 for two consecutive quarters, then the right of the
holders of the Series D Preferred Shares to elect such additional trustees shall
cease (but subject always to the same provision for the vesting of such voting
rights in the case of any similar future arrearage in quarterly dividends or
failure to maintain a ratio of Consolidated EBITDA to Consolidated Fixed Charges
of at least 1.75), and the terms of office of all persons elected as trustees by
the holders of the Series D Preferred Shares shall forthwith terminate and the
number of the Board of Trustees shall be reduced accordingly. At any time after
such voting power shall have been so vested in the holders of Series D Preferred
Shares, the Secretary of the Trust may, and upon the written request of any
holder of Series D Preferred Shares (addressed to the Secretary at the principal
office of the Trust) shall, call a special meeting of the holders of the Series
D Preferred Shares for the election of the trustees to be elected by them as
herein provided, such call to be made by notice similar to that provided in the
Bylaws of the Trust for a special meeting of the shareholders or as required by
law. If any such special meeting required to be called as above provided shall
not be called by the Secretary within 20 days after receipt of any such request,
then any holder of Series D Preferred Shares may call such meeting, upon the
notice above provided, and for that purpose shall have access to the records of
the Trust. The trustees elected at any such special meeting shall hold office
until the next annual meeting of the shareholders or special meeting held in
lieu thereof if such office shall not have previously terminated as above
provided. If any vacancy shall occur among the trustees elected by the holders
of the Series D Preferred Shares, a successor shall be elected by the Board of
Trustees, upon the nomination of the then-remaining trustee elected by the
holders of the Series D Preferred Shares or the successor of such remaining
trustee, to serve until the next annual meeting of the shareholders or special
meeting held in place thereof if the term of such trustee shall not have
previously terminated as provided above.

         So long as any Series D Preferred Shares are outstanding, in addition
to any other vote or consent of shareholders required by law or by the
Declaration, the affirmative vote of at least 51% of the votes entitled to be
cast by the holders of the Series D Preferred Shares given in person or by
proxy, either in writing without a meeting or by vote at any meeting called for
the purpose, shall be necessary for effecting or validating:

                  (a) Any amendment, alteration or repeal of any of the
         provisions of the Declaration or these Articles Supplementary that
         materially and adversely affects the voting powers, rights or
         preferences of the holders of the Series D Preferred Shares; PROVIDED,
         HOWEVER, that, subject to the provisions of Section 7 of these Articles
         Supplementary, the amendment of the provisions of the Declaration so as
         to authorize or create or to increase the authorized amount of, any
         Parity Shares, Fully Junior Shares or Junior Shares that are not senior
         in any respect to the Series D Preferred Shares shall not be deemed to
         materially

                                      -25-
<PAGE>

         adversely affect the voting powers, rights or preferences of the
         holders of Series D Preferred Shares; or

                  (b) A share exchange that affects the Series D Preferred
         Shares, a consolidation with or merger of the Trust into another
         entity, or a consolidation with or merger of another entity into the
         Trust, unless in each such case each Series D Preferred Share (i) shall
         remain outstanding without a material and adverse change to its terms
         and rights or (ii) shall be converted into or exchanged for convertible
         preferred shares of the surviving entity having preferences, conversion
         or other rights, voting powers, restrictions, limitations as to
         dividends, qualifications and terms or conditions of redemption thereof
         identical to that of a Series D Preferred Share (except for changes
         that do not materially and adversely affect the holders of the Series D
         Preferred Shares);

         PROVIDED, HOWEVER, that no such vote of the holders of Series D
         Preferred Shares shall be required if, at or prior to the time when
         such amendment, alteration or repeal is to take effect, or when the
         issuance of any such prior shares or convertible security is to be
         made, as the case may be, provision is made for the redemption of all
         Series D Preferred Shares at the time outstanding to the extent such
         redemption is authorized by Section 5 of this Article.

         For purposes of the foregoing provisions of this Section 10, each
Series D Preferred Share shall have one (1) vote per share, except that when any
other series of Preferred Shares shall have the right to vote with the Series D
Preferred Shares as a single class on any matter, then the Series D Preferred
Shares and such other series shall have with respect to such matters one (1)
vote per $26.50 (or less pursuant to Section 4(a)) of stated liquidation
preference. Except as otherwise required by applicable law or as set forth
herein, the Series D Preferred Shares shall not have any relative,
participating, optional or other special voting rights and powers other than as
set forth herein, and the consent of the holders thereof shall not be required
for the taking of any Trust action.

         Section 11. RECORD HOLDERS. The Trust and the Transfer Agent may deem
and treat the record holder of any Series D Preferred Shares as the true and
lawful owner thereof for all purposes, and neither the Trust nor the Transfer
Agent shall be affected by any notice to the contrary.

                                      -26-
<PAGE>

         IN WITNESS WHEREOF, the Trust has caused these Articles Supplementary
to be duly executed by its Senior Vice President and attested by its Secretary
this 20th day of March, 2001.

                                          PRENTISS PROPERTIES TRUST

                                          By:      /s/  MICHAEL A. ERNST
                                             ----------------------------------
                                          Its:     Michael A. Ernst
                                                   Senior Vice President
                                                   Chief Financial Officer

Attest:

By:      /s/  GREGORY S. IMHOFF
         -----------------------------
Its:     Gregory S. Imhoff
         Secretary