##### Table of Contents



Securities and Exchange Commission
 Washington, D.C. 20549
 FORM 10-Q
 QUARTERLY REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
   ARDEN REALTY, INC.
  Maryland
(State or other jurisdiction of incorporation or organization)
    
    95-4578533
(I.R.S. Employer Identification No.)
 11601 Wilshire Boulevard,
4th Floor
Los Angeles, California 90025-1740
  þ o
 þ o




---



ARDEN REALTY, INC.
 FORM 10-Q
TABLE OF CONTENTS
  
 PAGE NO.PART I. FINANCIAL INFORMATIONItem 1. Financial StatementsConsolidated Balance Sheets as of June 30, 2005 (unaudited) and December 31, 2004
    
    
    3Consolidated Statements of Income for the three and six months ended June 30, 2005 and 2004 (unaudited)
    
    
    4Consolidated Statements of Cash Flows for the six months ended June 30, 2005 and 2004 (unaudited)
    
    
    5Notes to Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    12Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    30Item 4. Controls and Procedures
    
    
    31PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    32Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    32Item 3. Defaults Upon Senior Securities
    
    
    32Item 4. Submission of Matters to a Vote of Security Holders
    
    
    32Item 5. Other Information
    
    
    32Item 6. Exhibits
    
    
    33SIGNATURES
    
    
    34Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




---



##### Table of Contents



Part I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 Arden Realty, Inc.
 
 Consolidated Balance Sheets
(in thousands, except per share data)
 June 30, 2005
    
    December 31, 2004(unaudited)AssetsInvestment in real estate:Land
    
    $
    490,218
    
    
    $
    432,291Buildings and improvements
    
    
    2,384,612
    
    
    
    2,097,058Tenant improvements and leasing commissions
    
    
    380,154
    
    
    
    347,6403,254,984
    
    
    
    2,876,989Less: accumulated depreciation and amortization
    
    
    (514,885
    )
    
    
    (468,716
    )2,740,099
    
    
    
    2,408,273Properties under renovation
    
    
    
    
    
    
    16,295Land available for development
    
    
    23,795
    
    
    
    23,795Properties held for disposition, net
    
    
    85,434
    
    
    
    103,618Net investment in real estate
    
    
    2,849,328
    
    
    
    2,551,981Cash and cash equivalents
    
    
    12,934
    
    
    
    13,040Restricted cash
    
    
    13,449
    
    
    
    14,788Rent and other receivables, net of allowance of $4,211 and $3,748 at June
30, 2005 and December 31, 2004, respectively
    
    
    7,657
    
    
    
    5,953Deferred rent, net of allowance of $1,866 and $1,933 at June 30, 2005 and
December 31, 2004, respectively
    
    
    40,626
    
    
    
    42,886Prepaid financing costs, expenses and other assets, net of accumulated
amortization of $10,827 and $13,244 at June 30, 2005 and December 31,
2004, respectively
    
    
    17,187
    
    
    
    31,349Total assets
    
    $
    2,941,181
    
    
    $
    2,659,997LiabilitiesMortgage loans payable
    
    $
    424,910
    
    
    $
    371,548Mortgage
loans payable  properties held for disposition
    
    
    3,845
    
    
    
    11,091Unsecured lines of credit
    
    
    296,000
    
    
    
    121,500Unsecured term loan
    
    
    125,000
    
    
    
    125,000Unsecured senior notes, net of discount
    
    
    794,161
    
    
    
    696,945Accounts payable and accrued expenses
    
    
    53,666
    
    
    
    58,215Security deposits
    
    
    26,209
    
    
    
    25,498Dividends payable
    
    
    33,844
    
    
    
    33,494Total liabilities
    
    
    1,757,635
    
    
    
    1,443,291Minority interest
    
    
    20,946
    
    
    
    20,414Stockholders EquityPreferred stock, $.01 par value, 20,000,000 shares authorized, none issued
    
    
    
    
    
    
    Common stock, $.01 par value, 100,000,000 shares authorized, 67,017,441
and 66,325,709 issued and outstanding at June 30, 2005 and December 31,
2004, respectively
    
    
    670
    
    
    
    664Additional paid-in capital
    
    
    1,180,112
    
    
    
    1,212,508Deferred compensation
    
    
    (11,169
    )
    
    
    (12,830
    )Accumulated other comprehensive loss
    
    
    (7,013
    )
    
    
    (4,050
    )Total stockholders equity
    
    
    1,162,600
    
    
    
    1,196,292Total liabilities and stockholders equity
    
    $
    2,941,181
    
    
    $
    2,659,997
 See accompanying notes to consolidated financial statements.
 3




---



##### Table of Contents



Arden Realty, Inc.
 
 Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)
 For the Three Months Ended
    
    For the Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    2004Property revenues
    
    $
    109,728
    
    
    $
    96,296
    
    
    $
    212,989
    
    
    $
    191,718Property operating expenses
    
    
    36,945
    
    
    
    31,152
    
    
    
    71,011
    
    
    
    62,14072,783
    
    
    
    65,144
    
    
    
    141,978
    
    
    
    129,578General and administrative expense
    
    
    7,560
    
    
    
    4,665
    
    
    
    15,805
    
    
    
    9,149Interest expense
    
    
    24,913
    
    
    
    20,931
    
    
    
    47,839
    
    
    
    43,989Depreciation and amortization
    
    
    35,880
    
    
    
    28,617
    
    
    
    66,893
    
    
    
    56,043Interest and other loss (income)
    
    
    893
    
    
    
    435
    
    
    
    1,144
    
    
    
    (330
    )Impairment on investment in securities
    
    
    
    
    
    
    2,700
    
    
    
    
    
    
    
    2,700Minority interest
    
    
    89
    
    
    
    1,245
    
    
    
    260
    
    
    
    2,556Income from continuing operations
    
    
    3,448
    
    
    
    6,551
    
    
    
    10,037
    
    
    
    15,471Discontinued operations, net of minority interest
    
    
    2,682
    
    
    
    2,176
    
    
    
    3,634
    
    
    
    5,688Gain on sale of discontinued properties
    
    
    4,319
    
    
    
    400
    
    
    
    6,376
    
    
    
    6,829Loss from debt defeasance related to sale of discontinued property
    
    
    
    
    
    
    
    
    
    
    (557
    )
    
    
    Net income
    
    $
    10,449
    
    
    $
    9,127
    
    
    $
    19,490
    
    
    $
    27,988Basic net income per common share:Income from continuing operations
    
    $
    0.05
    
    
    $
    0.10
    
    
    $
    0.15
    
    
    $
    0.24Income from discontinued operations
    
    
    0.11
    
    
    
    0.04
    
    
    
    0.14
    
    
    
    0.19Net income
per common share  basic
    
    $
    0.16
    
    
    $
    0.14
    
    
    $
    0.29
    
    
    $
    0.43Weighted
average number of common shares  basic
    
    
    66,587
    
    
    
    65,464
    
    
    
    66,423
    
    
    
    65,139Diluted net income per common share:Income from continuing operations
    
    $
    0.05
    
    
    $
    0.10
    
    
    $
    0.15
    
    
    $
    0.24Income from discontinued operations
    
    
    0.11
    
    
    
    0.04
    
    
    
    0.14
    
    
    
    0.19Net income
per common share  diluted
    
    $
    0.16
    
    
    $
    0.14
    
    
    $
    0.29
    
    
    $
    0.43Weighted
average number of common shares  diluted
    
    
    66,923
    
    
    
    65,759
    
    
    
    66,754
    
    
    
    65,496Dividends declared per common share
    
    $
    0.505
    
    
    $
    0.505
    
    
    $
    1.01
    
    
    $
    1.01
 See accompanying notes to consolidated financial statements.
 4




---



##### Table of Contents



Arden
Realty, Inc.
 
 Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
 For the Six Months EndedJune 30,2005
    
    2004Operating Activities:Net income
    
    $
    19,490
    
    
    $
    27,988Adjustments to reconcile net income to net cash provided by operating activities:Minority interest, including discontinued operations
    
    
    504
    
    
    
    2,877Gain on sale of discontinued properties
    
    
    (6,376
    )
    
    
    (6,829
    )Impairment on investment in securities
    
    
    
    
    
    
    2,700Depreciation and amortization, including discontinued operations
    
    
    68,138
    
    
    
    62,319Amortization of loan costs
    
    
    1,718
    
    
    
    2,083Non-cash compensation expense
    
    
    2,212
    
    
    
    1,531Changes in operating assets and liabilities:Rent and other receivables
    
    
    (1,704
    )
    
    
    (1,834
    )Deferred rent
    
    
    (2,336
    )
    
    
    (1,982
    )Prepaid financing costs, expenses and other assets
    
    
    262
    
    
    
    (2,205
    )Accounts payable and accrued expenses
    
    
    (3,837
    )
    
    
    (4,989
    )Security deposits
    
    
    864
    
    
    
    876Net cash provided by operating activities
    
    
    78,935
    
    
    
    82,535Investing Activities:Acquisitions and improvements to commercial properties
    
    
    (307,132
    )
    
    
    (47,367
    )Proceeds from sale of properties
    
    
    24,943
    
    
    
    68,284Net cash (used in) provided by investing activities
    
    
    (282,189
    )
    
    
    20,917Financing Activities:Repayments of mortgage loans
    
    
    (11,123
    )
    
    
    (178,197
    )Proceeds from unsecured lines of credit
    
    
    323,500
    
    
    
    244,000Repayments of unsecured lines of credit
    
    
    (149,000
    )
    
    
    (123,000
    )Proceeds from issuance of unsecured senior notes, net of discount and other issuance costs
    
    
    293,216
    
    
    
    Repayment of unsecured senior notes
    
    
    (200,000
    )
    
    
    Proceeds from issuance of common stock
    
    
    14,571
    
    
    
    22,391Termination of fair value hedges
    
    
    (466
    )
    
    
    Distributions to preferred operating partnership unit holders
    
    
    
    
    
    
    (2,156
    )Decrease (increase) in restricted cash
    
    
    1,339
    
    
    
    6,039Distributions to minority interests
    
    
    (1,714
    )
    
    
    (1,697
    )Dividends paid
    
    
    (67,175
    )
    
    
    (65,615
    )Net cash provided by (used in) financing activities
    
    
    203,148
    
    
    
    (98,235
    )Net (decrease) increase in cash and cash equivalents
    
    
    (106
    )
    
    
    5,217Cash and cash equivalents at beginning of period
    
    
    13,040
    
    
    
    4,707Cash and cash equivalents at end of period
    
    $
    12,934
    
    
    $
    9,924Supplemental Disclosure of Cash Flow Information:Cash paid during the period for interest, net of amounts capitalized
    
    $
    47,095
    
    
    $
    44,069
 See accompanying notes to consolidated financial statements.
 5




---



##### Table of Contents



Arden Realty, Inc.
 
 Notes to Consolidated Condensed Financial Statements
June 30, 2005
(unaudited)
 1. Organization and Basis of Presentation
 Organization
   Basis of Presentation
    Interim Financial Data
  Reclassifications
  Recent Accounting Pronouncements
  6




---



##### Table of Contents



2. Commercial Properties
 Property Dispositions
 Gross SalesPriceProperty
    
    County
    
    Submarket
    
    Date of Sale
    
    Property Type
    
    Square Feet
    
    ($000s)Activity Business
Center
    
    San Diego
    
    Miramar
    
    January 5, 2005
    
    Office
    
    
    167,170
    
    
    $
    16,6505832 Bolsa
    
    Orange
    
    West County
    
    June 29, 2005
    
    Office
    
    
    49,355
    
    
    
    8,670216,525
    
    
    $
    25,320
 Property Acquisitions
 Gross AcquisitionPriceProperty
    
    County
    
    Submarket
    
    Date of Acquisition
    
    Property Type
    
    Square Feet
    
    ($000s)707 Broadway
    
    San Diego
    
    Downtown
    
    January 5, 2005
    
    Office
    
    
    169,536
    
    
    $
    48,000
    (1)Arden Towers at
Sorrento
    
    San Diego
    
    Sorrento Mesa
    
    March 22, 2005
    
    Office/Retail
    
    
    608,253
    
    
    
    185,0005670 Wilshire Boulevard
    
    Los Angeles
    
    Miracle Mile
    
    April 8, 2005
    
    Office
    
    
    409,118
    
    
    
    92,650
    (2)1,186,907
    
    
    $
    325,650
 
 (1)
    
    Approximately $2.0 million of the acquisition price was funded through the issuance of
54,950 common operating partnership units at an average price of $37.27.(2)
    
    The acquisition price for 5670 Wilshire Boulevard includes the assumption of a $51.5
million mortgage loan payable secured by the property.  3. Discontinued Operations and Properties Held for Disposition
  Three Months Ended
    
    Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Revenues from rental operations
    
    $
    4,604
    
    
    $
    9,103
    
    
    $
    8,470
    
    
    $
    19,902Property expenses
    
    
    (1,644
    )
    
    
    (3,240
    )
    
    
    (3,158
    )
    
    
    (7,109
    )Depreciation and amortization
    
    
    (11
    )
    
    
    (3,370
    )
    
    
    (1,245
    )
    
    
    (6,276
    )Interest expense
    
    
    (87
    )
    
    
    (253
    )
    
    
    (189
    )
    
    
    (508
    )Minority interest
    
    
    (180
    )
    
    
    (64
    )
    
    
    (244
    )
    
    
    (321
    )Discontinued operations, net of minority interest.
    
    $
    2,682
    
    
    $
    2,176
    
    
    $
    3,634
    
    
    $
    5,688Gain on sale of discontinued properties
    
    $
    4,319
    
    
    $
    400
    
    
    $
    6,376
    
    
    $
    6,829Loss from debt defeasance related to sale of
discontinued property
    
    $
    
    
    
    $
    
    
    
    $
    (557
    )
    
    $
    
 7




---



##### Table of Contents



4. Outstanding Indebtedness
  Annual
    
    
    
    
    
    Number ofJune 30,
    
    December 31,
    
    Interest Rate at
    
    Rate
    
    PropertiesType of Debt
    
    2005
    
    2004
    
    June 30, 2005
    
    Fixed/Floating
    
    Securing Loan
    
    Maturity(in thousands)Mortgage Loans Payable:Mortgage Financing III(1)
    
    $
    131,315
    
    
    $
    132,323
    
    
    
    6.74
    %
    
    Fixed
    
    
    21
    
    
    
    4/08Mortgage Financing IV(1)
    
    
    107,392
    
    
    
    108,194
    
    
    
    6.61
    %
    
    Fixed
    
    
    12
    
    
    
    4/08Mortgage Financing V(1)
    
    
    102,221
    
    
    
    103,504
    
    
    
    6.94
    %
    
    Fixed
    
    
    12
    
    
    
    4/09Mortgage Financing VI(1)
    
    
    21,208
    
    
    
    21,325
    
    
    
    7.54
    %
    
    Fixed
    
    
    3
    
    
    
    4/095670 Wilshire(1), (2)
    
    
    56,752
    
    
    
    
    
    
    
    5.02
    %
    
    Fixed
    
    
    1
    
    
    
    9/28Activity Business Center(1), (3)
    
    
    
    
    
    
    7,222
    
    
    
    
    
    
    Fixed
    
    
    1
    
    
    
    145 South Fairfax(1)
    
    
    3,845
    
    
    
    3,869
    
    
    
    8.93
    %
    
    Fixed
    
    
    1
    
    
    
    1/27Marin Corporate Center(1)
    
    
    2,511
    
    
    
    2,585
    
    
    
    9.00
    %
    
    Fixed
    
    
    1
    
    
    
    7/15Conejo Business Center(1)
    
    
    2,458
    
    
    
    2,531
    
    
    
    8.75
    %
    
    Fixed
    
    (Note 4)
    
    
    7/15Conejo Business Center(1)
    
    
    1,053
    
    
    
    1,086
    
    
    
    7.88
    %
    
    Fixed
    
    (Note 4)
    
    
    7/15428,755
    
    
    
    382,639Unsecured Lines of Credit:Wells Fargo  $310 mm(5)
    
    
    286,000
    
    
    
    111,500
    
    
    
    4.22
    %
    
    LIBOR + 0.85% (Notes 6,7)
    
    
    
    
    
    
    4/09City National Bank  $20 mm(5), (8)
    
    
    10,000
    
    
    
    10,000
    
    
    
    4.09
    %
    
    LIBOR + 0.85%
    
    
    
    
    
    
    8/07296,000
    
    
    
    121,500Unsecured Term Loan:Wells Fargo  $125 mm(5)
    
    
    125,000
    
    
    
    125,000
    
    
    
    4.55
    %
    
    Fixed (Note 9)
    
    
    
    
    
    
    2/12Unsecured Senior Notes:2005 Notes(10), (11)
    
    
    
    
    
    
    199,974
    
    
    
    8.88
    %
    
    Fixed
    
    
    
    
    
    
    2007 Notes(10)
    
    
    149,172
    
    
    
    149,395
    
    
    
    7.00
    %
    
    Fixed (Note 12)
    
    
    
    
    
    
    11/072010 Notes(10)
    
    
    49,806
    
    
    
    49,785
    
    
    
    9.15
    %
    
    Fixed
    
    
    
    
    
    
    3/102010 Notes(10)
    
    
    99,554
    
    
    
    99,513
    
    
    
    8.50
    %
    
    Fixed
    
    
    
    
    
    
    11/102011 Notes(10)
    
    
    198,407
    
    
    
    198,278
    
    
    
    5.20
    %
    
    Fixed
    
    
    
    
    
    
    9/112015 Notes(13)
    
    
    297,222
    
    
    
    
    
    
    
    5.25
    %
    
    Fixed
    
    
    
    
    
    
    3/15794,161
    
    
    
    696,945Total Debt
    
    $
    1,643,916
    
    
    
    1,326,084
 
 (1)
    
    Requires monthly payments of principal and interest.(2)
    
    In April 2005, we assumed this mortgage loan in conjunction with the acquisition of
5670 Wilshire. The stated interest rate of this loan is 8.50% and the balance is approximately
$51.4 million at June 30, 2005. This loan was recorded at its fair market value at the date
of acquisition and can be prepaid without penalty beginning in September 2008.(3)
    
    This loan was repaid in full on January 3, 2005.(4)
    
    Both mortgage loans are secured by the Conejo Business Center property.(5)
    
    Requires monthly payments of interest only, with outstanding principal balance due upon
maturity.(6)
    
    This line of credit also has an annual 20 basis point facility fee on the entire $310
million commitment amount. In July 2005, we renewed this line of credit, extending the
maturity to April of 2009 and reducing the interest rate from LIBOR + 0.90% to LIBOR + 0.85%.(7)
    
    We have entered into interest rate swap agreements that fixed the interest rate on $50
million of the outstanding balance on this line of credit at 3.95% through April 2006.(8)
    
    In July 2005, we renewed this line of credit extending the maturity to August 2007 and
reducing the interest rate from LIBOR + 0.90% to LIBOR + 0.85%.(9)
    
    In February 2005, we extended the maturity of this loan to February 2012. This loan
bears interest at LIBOR + 1.25%, however we have entered into interest rate swap agreements
that fixed the interest rate on this loan at 4.55% in 2005 and 4.70% from January through June
2006, 5.29% from June 2006 through May 2007, 5.55% from June 2007 through November 2008, 5.76%
from December 2008 through May 2010 and 5.99% from June 2010 through February 2012.(10)
    
    Requires semi-annual interest payments only, with principal balance due upon maturity.(11)
    
    These senior unsecured notes were redeemed on March 1, 2005.(12)
    
    In June 2005, we terminated $100 million of fixed-to-floating swap agreements related
to these notes for a total payment of $466,000.(13)
    
    In February 2005, we issued $300 million of unsecured senior notes at an interest rate
of 5.25%. 
 8




---



##### Table of Contents



5. Interest Rate Hedge Agreements
        9




---



##### Table of Contents



6. Stockholders Equity and Minority Interests
       7. Income (Loss) from Taxable REIT Subsidiary
  For the Three Months Ended
    
    For the Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Net (loss) income from TRS
    
    $
    (539
    )
    
    $
    (517
    )
    
    $
    (1,029
    )
    
    $
    121Interest and other (loss) income
    
    
    (354
    )
    
    
    82
    
    
    
    (115
    )
    
    
    209$
    (893
    )
    
    $
    (435
    )
    
    $
    (1,144
    )
    
    $
    330
 8. Stock Option Plan
   For the Three Months Ended
    
    For the Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Net income available to common stockholders, as reported
    
    $
    10,449
    
    
    $
    9,127
    
    
    $
    19,490
    
    
    $
    27,988Stock based employee compensation costs for options granted
prior to 2003 assuming fair value method
    
    
    
    
    
    
    (77
    )
    
    
    (11
    )
    
    
    (154
    )Net income available to common stockholders, as adjusted
    
    $
    10,449
    
    
    $
    9,050
    
    
    $
    19,479
    
    
    $
    27,834Earnings per share:Basic as reported
    
    $
    0.16
    
    
    $
    0.14
    
    
    $
    0.29
    
    
    $
    0.43Basic as adjusted
    
    $
    0.16
    
    
    $
    0.14
    
    
    $
    0.29
    
    
    $
    0.43Diluted as reported
    
    $
    0.16
    
    
    $
    0.14
    
    
    $
    0.29
    
    
    $
    0.43Diluted as adjusted
    
    $
    0.16
    
    
    $
    0.14
    
    
    $
    0.29
    
    
    $
    0.42
 10




---



##### Table of Contents



9. Comprehensive Income
  For the Three Months Ended
    
    For the Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Net income
    
    $
    10,449
    
    
    $
    9,127
    
    
    $
    19,490
    
    
    $
    27,988Other comprehensive income:Unrealized derivative (loss) gain on cash flow hedges
    
    
    (6,482
    )
    
    
    10,406
    
    
    
    (3,455
    )
    
    
    1,357Reclassification adjustment for losses included in earnings
    
    
    112
    
    
    
    2,045
    
    
    
    492
    
    
    
    3,046Comprehensive income
    
    $
    4,079
    
    
    $
    21,578
    
    
    $
    16,527
    
    
    $
    32,391
 10. Commitments and Contingencies
  11. Subsequent Events
      11




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Overview
 The following discussion relates to our unaudited consolidated financial statements included
herein, which should be read in conjunction with the financial statements and related notes thereto
included elsewhere in this Form 10-Q and in our 2004 Annual Report on Form 10-K , as amended.
       Critical Accounting Policies
  Off-Balance Sheet Arrangements
  12




---



##### Table of Contents



RESULTS OF OPERATIONS
  Comparison of the three months ended June 30, 2005 to the three months ended June 30, 2004
(in thousands, except number of properties and percentages):
 Three Months EndedJune 30,Percent2005
    
    2004
    
    Change
    
    ChangeTotal Portfolio:Revenue from rental operations:Scheduled cash rents
    
    $
    96,079
    
    
    $
    83,384
    
    
    $
    12,695
    
    
    
    15
    %Straight-line rents
    
    
    973
    
    
    
    468
    
    
    
    505
    
    
    
    108Tenant reimbursements
    
    
    4,371
    
    
    
    4,341
    
    
    
    30
    
    
    
    1Parking, net of expense
    
    
    6,740
    
    
    
    5,891
    
    
    
    849
    
    
    
    14Other rental operations
    
    
    1,565
    
    
    
    2,212
    
    
    
    (647
    )
    
    
    (29
    )Total revenue from rental operations
    
    
    109,728
    
    
    
    96,296
    
    
    
    13,432
    
    
    
    14Property expenses:Repairs and maintenance
    
    
    12,694
    
    
    
    10,496
    
    
    
    2,198
    
    
    
    21Utilities
    
    
    8,076
    
    
    
    7,350
    
    
    
    726
    
    
    
    10Real estate taxes
    
    
    8,660
    
    
    
    7,314
    
    
    
    1,346
    
    
    
    18Insurance
    
    
    1,845
    
    
    
    1,788
    
    
    
    57
    
    
    
    3Ground rent
    
    
    334
    
    
    
    207
    
    
    
    127
    
    
    
    61Administrative
    
    
    5,336
    
    
    
    3,997
    
    
    
    1,339
    
    
    
    34Total property expenses
    
    
    36,945
    
    
    
    31,152
    
    
    
    5,793
    
    
    
    19Property Operating Results(1)
    
    
    72,783
    
    
    
    65,144
    
    
    
    7,639
    
    
    
    12General and administrative
    
    
    7,560
    
    
    
    4,665
    
    
    
    2,895
    
    
    
    62Interest expense
    
    
    24,913
    
    
    
    20,931
    
    
    
    3,982
    
    
    
    19Depreciation and amortization
    
    
    35,880
    
    
    
    28,617
    
    
    
    7,263
    
    
    
    25Interest and other loss
    
    
    893
    
    
    
    435
    
    
    
    458
    
    
    
    105Impairment on investment in securities
    
    
    
    
    
    
    2,700
    
    
    
    (2,700
    )
    
    
    (100
    )Minority interest
    
    
    89
    
    
    
    1,245
    
    
    
    (1,156
    )
    
    
    (93
    )Income from continuing operations
    
    $
    3,448
    
    
    $
    6,551
    
    
    $
    (3,103
    )
    
    
    (47
    )%Discontinued operations, net of minority interest
    
    $
    2,682
    
    
    $
    2,176
    
    
    $
    506
    
    
    
    23
    %Number of Properties:Disposed of during period
    
    
    1
    
    
    
    Acquired during period
    
    
    1
    
    
    
    1In service at end of period
    
    
    121
    
    
    
    128Net Rentable Square Feet:Disposed of during period
    
    
    (49
    )
    
    
    Acquired during period
    
    
    409
    
    
    
    283In service at end of period
    
    
    19,214
    
    
    
    18,785Same Property Portfolio(2):Revenue from rental operations
    
    $
    100,338
    
    
    $
    98,654
    
    
    $
    1,684
    
    
    
    2
    %Property expenses
    
    
    33,384
    
    
    
    31,806
    
    
    
    1,578
    
    
    
    5
    %$
    66,954
    
    
    $
    66,848
    
    
    $
    106
    
    
    
    
    %Straight-line rents
    
    $
    (155
    )
    
    $
    50
    
    
    $
    (205
    )
    
    
    (410
    )%Number of non-development properties
    
    
    115
    
    
    
    115Number of buildings
    
    
    187
    
    
    
    187Average occupancy
    
    
    90.5
    %
    
    
    89.5
    %Net rentable square feet
    
    
    17,221
    
    
    
    17,221
 
 (1)
    
    Property Operating Results is commonly used by investors to evaluate the
performance of REITs, to determine trends in earnings and to compute the fair value
of properties as it is not affected by (1) the cost of funds of the property owner or
(2) the impact of depreciation and amortization expenses as well as gains or losses
from the sale of operating real estate assets that are included in net income
computed in accordance with Generally Accepted Accounting Principles, or GAAP. The
first factor is commonly eliminated from net income because it is specific to the
particular financing capabilities and constraints of the owner. The second factor is
commonly eliminated because it may not accurately represent the actual change in
value in real estate 13




---



##### Table of Contents



properties that results from use or changes in market
conditions. We believe that eliminating these costs from net income gives investors
an additional measure of operating performance that, when used as an adjunct to net income computed
in accordance with GAAP, can be a useful measure of our operating results.    Three Months EndedJune 30,2005
    
    2004Net income
    
    $
    10,449
    
    
    $
    9,127Add:General and administrative expense
    
    
    7,560
    
    
    
    4,665Interest expense
    
    
    24,913
    
    
    
    20,931Depreciation and amortization
    
    
    35,880
    
    
    
    28,617Minority interest
    
    
    89
    
    
    
    1,245Interest and other loss
    
    
    893
    
    
    
    435Impairment on investment in securities
    
    
    
    
    
    
    2,700Less:Gain on sale of discontinued properties
    
    
    4,319
    
    
    
    400Discontinued operations, net of minority interest
    
    
    2,682
    
    
    
    2,176Property Operating Results
    
    $
    72,783
    
    
    $
    65,144
 
 (2)
    
    Consists of non-development/renovation properties classified as part of
continuing operations and owned for the entirety of the periods presented. VARIANCES FOR RESULTS OF OPERATIONS
   Revenue from Rental Operations
   Property Expenses
   14




---



##### Table of Contents



General and Administrative
  Interest Expense
  Depreciation and Amortization
  Interest and Other Loss
  15




---



##### Table of Contents



Comparison of the six months ended June 30, 2005 to the six months ended June 30, 2004
(in thousands, except number of properties and percentages):
 Six Months EndedJune 30,Percent2005
    
    2004
    
    Change
    
    ChangeTotal Portfolio:Revenue from rental operations:Scheduled cash rents
    
    $
    185,401
    
    
    $
    166,059
    
    
    $
    19,342
    
    
    
    12
    %Straight-line rents
    
    
    1,678
    
    
    
    1,400
    
    
    
    278
    
    
    
    20Tenant reimbursements
    
    
    9,462
    
    
    
    8,665
    
    
    
    797
    
    
    
    9Parking, net of expense
    
    
    12,689
    
    
    
    11,356
    
    
    
    1,333
    
    
    
    12Other rental operations
    
    
    3,759
    
    
    
    4,238
    
    
    
    (479
    )
    
    
    (11
    )Total revenue from rental operations
    
    
    212,989
    
    
    
    191,718
    
    
    
    21,271
    
    
    
    11Property expenses:Repairs and maintenance
    
    
    24,650
    
    
    
    20,794
    
    
    
    3,856
    
    
    
    19Utilities
    
    
    15,568
    
    
    
    14,214
    
    
    
    1,354
    
    
    
    10Real estate taxes
    
    
    16,762
    
    
    
    14,761
    
    
    
    2,001
    
    
    
    14Insurance
    
    
    3,576
    
    
    
    3,635
    
    
    
    (59
    )
    
    
    (2
    )Ground rent
    
    
    637
    
    
    
    332
    
    
    
    305
    
    
    
    92Administrative
    
    
    9,818
    
    
    
    8,404
    
    
    
    1,414
    
    
    
    17Total property expenses
    
    
    71,011
    
    
    
    62,140
    
    
    
    8,871
    
    
    
    14Property Operating Results(1)
    
    
    141,978
    
    
    
    129,578
    
    
    
    12,400
    
    
    
    10General and administrative
    
    
    15,805
    
    
    
    9,149
    
    
    
    6,656
    
    
    
    73Interest expense
    
    
    47,839
    
    
    
    43,989
    
    
    
    3,850
    
    
    
    9Depreciation and amortization
    
    
    66,893
    
    
    
    56,043
    
    
    
    10,850
    
    
    
    19Interest and other loss (income)
    
    
    1,144
    
    
    
    (330
    )
    
    
    1,474
    
    
    
    447Impairment on investment in securities
    
    
    
    
    
    
    2,700
    
    
    
    (2,700
    )
    
    
    (100
    )Minority interest
    
    
    260
    
    
    
    2,556
    
    
    
    (2,296
    )
    
    
    (90
    )Income from continuing operations
    
    $
    10,037
    
    
    $
    15,471
    
    
    $
    (5,434
    )
    
    
    (35
    )%Discontinued operations, net of minority interest
    
    $
    3,634
    
    
    $
    5,688
    
    
    $
    (2,054
    )
    
    
    (36
    )%Number of Properties:Disposed of during period
    
    
    (2
    )
    
    
    (2
    )Acquired during period
    
    
    3
    
    
    
    Completed and placed in service during period
    
    
    
    
    
    
    1In service at end of period
    
    
    121
    
    
    
    128Net Rentable Square Feet:Disposed of during period
    
    
    (217
    )
    
    
    (295
    )Acquired during period
    
    
    1,187
    
    
    
    Completed and placed in service during period
    
    
    
    
    
    
    283In service at end of period
    
    
    19,214
    
    
    
    18,785Same Property Portfolio(2):Revenue from rental operations
    
    $
    199,738
    
    
    $
    196,575
    
    
    $
    3,163
    
    
    
    2
    %Property expenses
    
    
    66,525
    
    
    
    63,558
    
    
    
    2,967
    
    
    
    5
    %$
    133,213
    
    
    $
    133,017
    
    
    $
    196
    
    
    
    
    %Straight-line rents
    
    $
    (84
    )
    
    $
    400
    
    
    $
    (484
    )
    
    
    (121
    )%Number of non-development properties
    
    
    115
    
    
    
    115Number of buildings
    
    
    187
    
    
    
    187Average occupancy
    
    
    90.7
    %
    
    
    89.6
    %Net rentable square feet
    
    
    17,221
    
    
    
    17,221
 
 (1)
    
    Property Operating Results is commonly used by investors to evaluate the
performance of REITs, to determine trends in earnings and to compute the fair value
of properties as it is not affected by (1) the cost of funds of the property owner or
(2) the impact of depreciation and amortization expenses as well as gains or losses
from the sale of operating real estate assets that are included in net income
computed in accordance with Generally Accepted Accounting Principles, or GAAP. The
first factor is commonly eliminated from net income because it is specific to the
particular financing capabilities and constraints of the owner. The second factor is
commonly eliminated because it may not accurately represent the actual change in
value in real estate properties that results from use or changes in market
conditions. We believe that eliminating these costs from net income gives investors
an additional measure of operating performance that, when used as an adjunct to net
income computed in accordance with GAAP, can be a useful measure of our operating
results.Property Operating Results captures trends in occupancy rates, rental rates and
operating costs. However, Property Operating Results excludes 16




---



##### Table of Contents



Six Months Ended June 30,2005
    
    2004Net income
    
    $
    19,490
    
    
    $
    27,988Add:General and administrative expense
    
    
    15,805
    
    
    
    9,149Interest expense
    
    
    47,839
    
    
    
    43,989Depreciation and amortization
    
    
    66,893
    
    
    
    56,043Minority interest
    
    
    260
    
    
    
    2,556Impairment on investment in securities
    
    
    
    
    
    
    2,700Interest and other loss
    
    
    1,144
    
    
    
    Loss from debt defeasance related to sale of discontinued property
    
    
    557
    
    
    
    Less:Gain on sale of discontinued properties
    
    
    6,376
    
    
    
    6,829Discontinued operations, net of minority interest
    
    
    3,634
    
    
    
    5,688Interest and other income
    
    
    
    
    
    
    330Property Operating Results
    
    $
    141,978
    
    

    $
    129,578
 
 (2)
    
    Consists of non-development/renovation properties classified as part of continuing
operations and owned for the entirety of the periods presented. VARIANCES FOR RESULTS OF OPERATIONS
   Revenue from Rental Operations
   Property Expenses
   17




---



##### Table of Contents



General and Administrative
  Interest Expense
  Depreciation and Amortization
  Interest and Other Loss (Income)
  LIQUIDITY AND CAPITAL RESOURCES
 Cash Flows
    Cash Balances and Available Borrowings
  18




---



##### Table of Contents



Capital Recycling Program
  19




---



##### Table of Contents



Debt Summary
  Year
    

Amount2005
    
    $
    4,3612006
    
    
    9,5702007
    
    
    169,838
    (1)2008
    
    
    281,5672009
    
    
    398,004
    (2)2010
    
    
    150,0192011
    
    
    200,2512012
    
    
    125,4812013
    
    
    5582014
    
    
    627Thereafter
    
    
    303,640Total
    
    $
    1,643,916
 
 (1)
    
    Includes $10 million outstanding on our City National Bank unsecured line of credit that
was extended to August 2007 in July 2005.(2)
    
    Includes $286 million outstanding on our Wells Fargo unsecured line of credit that was
extended to April 2009 in July 2005.  Unsecured and Secured Debt:
 Weighted
    
    WeightedAverage
    
    AverageBalance
    
    Percent
    
    Interest Rate(1)
    
    Maturity (in years)(000s)Unsecured Debt
    
    $
    1,215,161
    
    
    
    74
    %
    
    
    5.80
    %
    
    
    7.1Secured Debt
    
    
    428,755
    
    
    
    26
    
    
    
    6.88
    
    
    
    3.0Total Debt
    
    $
    1,643,916
    
    
    
    100
    %
    
    
    6.08
    %
    
    
    6.9
 Floating and Fixed Rate Debt:
 Weighted
    
    WeightedAverage
    
    AverageBalance
    
    Percent
    
    Interest Rate(1)
    
    Maturity (in years)(000s
    )Floating Rate Debt
    
    $
    246,000
    
    
    
    15
    %
    
    
    4.84
    %
    
    
    3.7Fixed Debt(2)
    
    
    1,397,916
    
    
    
    85
    
    
    
    6.30
    
    
    
    6.4Total Debt
    
    $
    1,643,916
    
    
    
    100
    %
    
    
    6.08
    %
    
    
    6.9
 
 (1)
    
    Includes amortization of prepaid financing costs.(2)
    
    Includes $175 million of floating rate debt that has been fixed through interest rate
swap agreements.  Three Months Ended June 30,
    
    Six Months Ended June 30,2005
    
    2004
    
    2005
    
    2004Total interest incurred(1)
    
    $
    25,097
    
    
    $
    21,382
    
    
    $
    48,360
    
    
    $
    44,851Amount capitalized
    
    
    97
    
    
    
    198
    
    
    
    332
    
    
    
    354Amount expensed(1)
    
    $
    25,000
    
    
    $
    21,184
    
    
    $
    48,028
    
    
    $
    44,497
 
 (1)
    
    Includes interest expense for loans secured by a property currently classified as held for
disposition and one property sold during the three months ended March 31, 2005. 20




---



##### Table of Contents



Consolidated Income Available for Debt Service and Compliance with Principal Financial
Covenants
      Three Months Ended
    
    Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Net cash provided by operating activities
    
    $
    48,158
    
    
    $
    38,693
    
    
    $
    78,935
    
    
    $
    82,535Add:Interest expense including discontinued operations
    
    
    25,000
    
    
    
    21,184
    
    
    
    48,028
    
    
    
    44,497Loss from debt defeasance related to sale of discontinued property
    
    
    
    
    
    
    
    
    
    
    557
    
    
    
    Less:Amortization of loan costs and fees
    
    
    (848
    )
    
    
    (1,004
    )
    
    
    (1,718
    )
    
    
    (2,083
    )Straight-line rent
    
    
    (997
    )
    
    
    (448
    )
    
    
    (1,801
    )
    
    
    (1,341
    )Changes in operating assets and liabilities:Rent and other receivables
    
    
    242
    
    
    
    (223
    )
    
    
    1,704
    
    
    
    1,834Deferred rent
    
    
    174
    
    
    
    345
    
    
    
    2,336
    
    
    
    1,982Prepaid financing costs, expenses and other assets
    
    
    (743
    )
    
    
    1,672
    
    
    
    (262
    )
    
    
    2,205Accounts payable and accrued expenses
    
    
    (2,719
    )
    
    
    6,630
    
    
    
    3,837
    
    
    
    4,989Security deposits
    
    
    (281
    )
    
    
    (605
    )
    
    
    (864
    )
    
    
    (876
    )Consolidated Income Available for Debt Service
    
    $
    67,986
    
    
    $
    66,244
    
    
    $
    130,752
    
    
    $
    133,742
 21




---



##### Table of Contents



Three Months Ended
    
    Six Months EndedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Net Income
    
    $
    10,449
    
    
    $
    9,127
    
    
    $
    19,490
    
    
    $
    27,988Add:Interest expense including discontinued operations
    
    
    25,000
    
    
    
    21,184
    
    
    
    48,028
    
    
    
    44,497Depreciation and amortization
    
    
    35,880
    
    
    
    28,617
    
    
    
    66,893
    
    
    
    56,043Amortization of deferred compensation
    
    
    1,693
    
    
    
    785
    
    
    
    2,212
    
    
    
    1,531Minority interest
    
    
    89
    
    
    
    1,245
    
    
    
    260
    
    
    
    2,556Loss from debt defeasance related to sale of discontinued property
    
    
    
    
    
    
    
    
    
    
    557
    
    
    
    Minority interest from discontinued operations
    
    
    180
    
    
    
    64
    
    
    
    244
    
    
    
    321Depreciation from discontinued operations
    
    
    11
    
    
    
    3,370
    
    
    
    1,245
    
    
    
    6,276Impairment on investment in securities
    
    
    
    
    
    
    2,700
    
    
    
    
    
    
    
    2,700Less:Gain on sale of discontinued properties
    
    
    (4,319
    )
    
    
    (400
    )
    
    
    (6,376
    )
    
    
    (6,829
    )Straight-line rent
    
    
    (997
    )
    
    
    (448
    )
    
    
    (1,801
    )
    
    
    (1,341
    )Consolidated Income Available for Debt Service
    
    $
    67,986
    
    
    $
    66,244
    
    
    $
    130,752
    
    
    $
    133,742
    22




---



##### Table of Contents



Net investment in real estate
    
    $
    2,849,328Cash and cash equivalents
    
    
    12,934Restricted cash
    
    
    13,449Accumulated depreciation and amortization
    
    
    533,855Total Gross Assets
    
    $
    3,409,566Gross Value of Unencumbered Assets
    
    $
    2,443,336Mortgage loans payable(1)
    
    $
    428,755Unsecured lines of credit
    
    
    296,000Unsecured term loan
    
    
    125,000Unsecured senior notes, net of discount
    
    
    794,161Total Outstanding Debt
    
    $
    1,643,916Consolidated Income Available for Debt Service(2)
    
    $
    267,230Interest incurred(2)
    
    $
    93,960Loan fee amortization(2)
    
    
    (2,768
    )Debt Service(2)
    
    $
    91,192
 Senior Unsecured Notes Covenant Ratios
    
    Test
    
    ActualRatio of Consolidated Income Available for Debt Service to Debt
Service
    
    Greater than 1.5
    
    
    2.9Total Outstanding Debt/Total Gross Assets
    
    Less than 60%
    
    
    48
    %Secured Debt/Total Gross Assets
    
    Less than 40%
    
    
    13
    %Greater thanGross Value of Unencumbered Assets/Unsecured Debt
    
    150%
    
    
    201
    %
 Wells Fargo Unsecured Line of Credit Covenant Ratios
    
    Test
    
    ActualRatio of Consolidated Income Available for Debt Service to interest expense(3)
    
    Greater than 2.0
    
    
    2.8Ratio of Consolidated Income Available for Debt Service to fixed charges (4)
    
    Greater than 1.75
    
    
    2.1
 
 (1)
    
    Represents 9 secured loans that are secured by 52 properties in our portfolio.(2)
    
    Represents amounts for the most recent four consecutive quarters. Loan fee
amortization excludes discount amortization on senior unsecured notes.(3)
    
    Interest expense consists of interest expense plus capitalized interest and less
amortization of loan fees and discounts. In conjunction with the amendment of this unsecured
line of credit in July 2005, this compliance calculation is no longer required.(4)
    
    Fixed charges consist of interest costs, whether expensed or capitalized, principal
payments on all debt, an amount equal to $0.3125 per quarter multiplied            by the
weighted average gross leaseable square feet of the portfolio at the end of the period and
preferred unit distributions. In conjunction with the amendment of this unsecured line of
credit in July 2005, the benchmark for this compliance calculation was reduced from 1.75
to 1.50. 23




---



##### Table of Contents



Funds from Operations
  Three Months Ended June 30,
    
    Six Months Ended June 30,2005
    
    2004
    
    2005
    
    2004Funds From Operations:(1)Net income
    
    $
    10,449
    
    
    $
    9,127
    
    
    $
    19,490
    
    
    $
    27,988Depreciation and minority interest from discontinued operations
    
    
    191
    
    
    
    3,434
    
    
    
    1,489
    
    
    
    6,597Gain on sale of discontinued properties
    
    
    (4,319
    )
    
    
    (400
    )
    
    
    (6,376
    )
    
    
    (6,829
    )Depreciation and amortization
    
    
    35,880
    
    
    
    28,617
    
    
    
    66,893
    
    
    
    56,043Minority interest
    
    
    89
    
    
    
    1,245
    
    
    
    260
    
    
    
    2,556Income allocated to Preferred Operating Partnership Units
    
    
    
    
    
    
    (1,078
    )
    
    
    
    
    
    
    (2,156
    )Funds From Operations(2)
    
    $
    42,290
    
    
    $
    40,945
    
    
    $
    81,756
    
    
    $
    84,199Weighted average common shares and Operating Partnership units
outstanding  Diluted
    
    
    68,638
    
    
    
    67,430
    
    
    
    68,473
    
    
    
    67,173
 
 (1)
    
    We believe that funds from operations, or FFO, is a useful supplemental measure
of our operating performance. We compute FFO in accordance with standards established
by the White Paper on FFO approved by the Board of Governors of the National Association
of Real Estate Investment Trusts, or NAREIT, in April 2002. The White Paper defines FFO
as net income or loss computed in accordance with generally accepted accounting
principles, or GAAP, excluding extraordinary items, as defined by GAAP, and gains and
losses from sales of depreciable operating property plus real estate-related
depreciation and amortization and after adjustments for unconsolidated partnerships and
joint ventures.We believe that FFO, by excluding depreciation costs, the gains or losses from the sale of
operating real estate properties and the extraordinary items as defined by GAAP, provides
an additional perspective on our operating results. However, because these excluded items
have a real economic effect, FFO is a limited measure of performance.FFO captures trends in occupancy rates, rental rates and operating costs. FFO excludes
depreciation and amortization costs and it does not capture the changes in value in our
properties that result from use or changes in market conditions or the level of capital
expenditures and leasing costs necessary to maintain the operating performance of our
properties, all of which are significant economic costs. Therefore, its ability to measure
performance is limited.Because FFO excludes significant economic components of net income determined in
accordance with GAAP, FFO should be used as an adjunct to net income and not as an
alternative to net income. FFO should also not be used as an indicator of our financial
performance, or as a substitute for cash flow from operating activities determined in
accordance with GAAP or as a measure of our liquidity. FFO is not by itself indicative of
funds available to fund our cash needs, including our ability to pay dividends or service
our debt.FFO is used by investors to compare our performance with other REITs. Other REITs may use
different methods for calculating FFO and, accordingly, our FFO may not be comparable to
other REITs.(2)
    
    Includes approximately $1.7 million and $0.8 million in non-cash compensation expense
for the three months ended June 30, 2005 and 2004, respectively, and approximately $2.2
million and $1.5 million in non-cash compensation expense for the six months ended June
30, 2005 and 2004, respectively. 24




---



##### Table of Contents



Portfolio and Lease Information
  PORTFOLIO SUMMARY
 Property Operating ResultsNumber of
    
    Number of
    
    Approximate Net
    
    Three Months Ended
    
    Six Months EndedLocation
    
    Properties
    
    Buildings
    
    Rentable (Sq. Ft.)
    
    June 30, 2005
    
    June 30, 2005(in thousands and
    
    (in thousands andunaudited)
    
    unaudited)Total
    
    % of Total
    
    Total
    
    % of Total
    
    Total
    
    % of Total
    
    Total
    
    % of Total
    
    Total
    
    % of TotalLos Angeles CountyWest(1)
    
    
    30
    
    
    
    25
    %
    
    
    32
    
    
    
    16
    %
    
    
    5,408,635
    
    
    
    28
    %
    
    $
    28,609
    
    
    
    38
    %
    
    $
    55,353
    
    
    
    37
    %North
    
    
    28
    
    
    
    23
    %
    
    
    44
    
    
    
    22
    %
    
    
    3,453,333
    
    
    
    18
    %
    
    
    13,298
    
    
    
    18
    %
    
    
    26,956
    
    
    
    18
    %South
    
    
    11
    
    
    
    9
    %
    
    
    15
    
    
    
    8
    %
    
    
    2,450,252
    
    
    
    13
    %
    
    
    7,529
    
    
    
    10
    %
    
    
    15,146
    
    
    
    10
    %Subtotal
    
    
    69
    
    
    
    57
    %
    
    
    91
    
    
    
    46
    %
    
    
    11,312,220
    
    
    
    59
    %
    
    
    49,436
    
    
    
    66
    %
    
    
    97,455
    
    
    
    65
    %Orange County

    
    
    18
    
    
    
    15
    %
    
    
    50
    
    
    
    25
    %
    
    
    3,214,977
    
    
    
    17
    %
    
    
    9,331
    
    
    
    12
    %
    
    
    18,712
    
    
    
    13
    %San Diego County
    
    
    24
    
    
    
    20
    %
    
    
    36
    
    
    
    18
    %
    
    
    3,310,065
    
    
    
    17
    %
    
    
    12,082
    
    
    
    16
    %
    
    
    21,959
    
    
    
    15
    %Ventura/Kern Counties
    
    
    4
    
    
    
    3
    %
    
    
    13
    
    
    
    7
    %
    
    
    575,224
    
    
    
    3
    %
    
    
    1,934
    
    
    
    2
    %
    
    
    3,852
    
    
    
    3
    %Subtotal(2)
    
    
    115
    
    
    
    95
    %
    
    
    190
    
    
    
    96
    %
    
    
    18,412,486
    
    
    
    96
    %
    
    $
    72,783
    
    
    
    96
    %
    
    $
    141,978
    
    
    
    96
    %Properties Held for Disposition
    
    
    6
    
    
    
    5
    
    
    
    8
    
    
    
    4
    %
    
    
    801,403
    
    
    
    4
    %
    
    
    2,960
    
    
    
    4
    
    
    
    5,312
    
    
    
    4Total (Including
Properties Held for
Disposition)
    
    
    121
    
    
    
    100
    %
    
    
    198
    
    
    
    100
    %
    
    
    19,213,889
    
    
    
    100
    %
    
    $
    75,743
    
    
    
    100
    %
    
    $
    147,290
    
    
    
    100
    %
 
 (1)
    
    Includes a retail property with approximately 37,000 net rentable square feet.(2)
    
    Excludes six properties currently classified as held for disposition as of June
30, 2005. PORTFOLIO OCCUPANCY AND IN-PLACE RENTS
 Percent
    
    Percent
    
    Annualized Base RentLocation
    
    Occupied
    
    Leased
    
    Per Leased Square Foot(1)Portfolio
    
    Full ServiceTotal
    
    Gross Leases(2)Los Angeles CountyWest
    
    
    93.7
    %
    
    
    95.3
    %
    
    $
    28.09
    
    
    $
    28.11North
    
    
    93.7
    %
    
    
    94.4
    %
    
    
    22.57
    
    
    
    23.21South
    
    
    91.0
    %
    
    
    92.6
    %
    
    
    19.07
    
    
    
    20.40Subtotal/Weighted Average
    
    
    93.1
    %
    
    
    94.4
    %
    
    $
    24.49
    
    
    $
    25.20Orange County
    
    
    87.7
    %
    
    
    92.5
    %
    
    
    19.54
    
    
    
    22.11San Diego County
    
    
    84.7
    %
    
    
    85.2
    %
    
    
    22.78
    
    
    
    25.28Ventura/Kern Counties
    
    
    97.1
    %
    
    
    97.1
    %
    
    
    19.71
    
    
    
    19.71Subtotal/Weighted Average(3)
    
    
    90.8
    %
    
    
    92.5
    %
    
    $
    23.19
    
    
    $
    24.55Properties Held for Disposition
    
    
    84.1
    %
    
    
    84.1
    %
    
    
    17.01
    
    
    
    18.85Total/Weighted Average
    
    
    90.5
    %
    
    
    92.2
    %
    
    $
    22.95
    
    
    $
    24.41
 
 (1)
    
    Based on monthly contractual base rent under existing leases as of June 30, 2005,
multiplied by 12 and divided by leased net rentable square feet; for those leases where
rent has not yet commenced or which are in a free rent period, the first month in which
rent is to be received is used to determine annualized base rent.(2)
    
    Excludes 29 properties and approximately 3.2 million square feet under triple net
and modified gross leases.(3)
    
    Excludes six properties classified as held for disposition as of June 30, 2005. 25




---



##### Table of Contents



TEN LARGEST TENANTS (1)
 Weighted
    
    Percentage of
    
    Percentage ofAverage
    
    Aggregate
    
    AggregateRemaining
    
    Portfolio
    
    Portfolio
    
    
    
    
    
    AnnualizedNumber of
    
    Lease Term
    
    Leased
    
    Annualized
    
    Net Rentable
    
    Base RentTenant
    
    Locations
    
    in Months
    
    Square Feet
    
    Base Rent(2)
    
    Square Feet
    
    (in thousands)(2)Vivendi Universal
    
    
    2
    
    
    
    39
    
    
    
    1.36
    %
    
    
    2.02
    %
    
    
    231,681
    
    
    $
    7,980State of California
    
    
    16
    
    
    
    45
    
    
    
    1.53
    %
    
    
    1.45
    %
    
    
    261,120
    
    
    
    5,736U.S. Government
    
    
    14
    
    
    
    51
    
    
    
    0.93
    %
    
    
    1.10
    %
    
    
    158,070
    
    
    
    4,336Ceridian Corporation
    
    
    2
    
    
    
    86
    
    
    
    0.90
    %
    
    
    0.97
    %
    
    
    152,612
    
    
    
    3,822Atlantic Richfield
    
    
    1
    
    
    
    15
    
    
    
    0.84
    %
    
    
    0.90
    %
    
    
    143,885
    
    
    
    3,551Pepperdine University
    
    
    1
    
    
    
    161
    
    
    
    0.67
    %
    
    
    0.86
    %
    
    
    113,488
    
    
    
    3,400University of Phoenix
    
    
    5
    
    
    
    44
    
    
    
    0.85
    %
    
    
    0.83
    %
    
    
    144,498
    
    
    
    3,303Westfield Corporation
    
    
    1
    
    
    
    94
    
    
    
    0.62
    %
    
    
    0.82
    %
    
    
    106,008
    
    
    
    3,226Walt Disney Pictures & Television
    
    
    1
    
    
    
    37
    
    
    
    0.83
    %
    
    
    0.81
    %
    
    
    141,457
    
    
    
    3,196Homestore.com, Inc.
    
    
    1
    
    
    
    31
    
    
    
    0.81
    %
    
    
    0.77
    %
    
    
    137,762
    
    
    
    3,036Total/Weighted Average
(3)
    
    
    44
    
    
    
    56
    
    
    
    9.34
    %
    
    
    10.53
    %
    
    
    1,590,581
    
    
    $
    41,586
 
 (1)
    
    Excludes tenants occupying six properties classified as held for disposition at
June 30, 2005.(2)
    
    Annualized base rent is calculated as monthly contractual base rent under
existing leases as of June 30, 2005 multiplied by 12; for those leases where rent has
not yet commenced or which are in a free rent period, the first month in which rent is
to be received is used to determine annualized base rent.(3)
    
    The weighted average calculation is based on net rentable square footage leased
by each tenant. 26




---



##### Table of Contents



LEASING ACTIVITY (1)
 Three Months
    
    Six MonthsEnded
    
    EndedJune 30, 2005
    
    June 30, 2005Net Absorption (square feet)
    
    
    27,732
    
    
    
    62,476Gross New Leasing Activity (square feet)(2)
    
    
    548,053
    
    
    
    990,686Gross Renewal Leasing Activity (square feet)
    
    
    536,026
    
    
    
    1,017,021Retention Rate
    
    
    64
    %
    
    
    64
    %Cash Rent Growth(3):Expiring Rate
    
    $
    22.38
    
    
    $
    22.29New / Renewed Rate
    
    $
    22.49
    
    
    $
    22.02Increase (decrease)
    
    
    0.5
    %
    
    
    (1.2
    )%GAAP Rent Growth(4):Expiring Rate
    
    $
    21.46
    
    
    $
    21.39New / Renewed Rate
    
    $
    23.24
    
    
    $
    22.65Increase
    
    
    8.3
    %
    
    
    5.9
    %Weighted Average Lease Term in Months  New
    
    
    59
    
    
    
    56Weighted Average Lease Term in Months  Renewal
    
    
    40
    
    
    
    39Tenant Improvements and Commissions (per square foot):New(2)
    
    $
    22.28
    
    
    $
    20.69Renewal
    
    $
    11.35
    
    
    $
    9.43Capital Expenditures (per square foot):Recurring
    
    $
    0.25
    
    
    $
    0.43Non-recurring
    
    $
    0.07
    
    
    $
    0.08
 
 (1)
    
    The information presented above excludes activity for six properties classified
as held for disposition at June 30, 2005.(2)
    
    Excludes development/renovation space.(3)
    
    Represents the difference between initial stabilized cash rents on new and
renewal leases as compared to the expiring cash rents on the same space. For leases
with reduced initial rents, the first month of full rent is used.(4)
    
    Represents cash rent growth adjusted for straight-line rents. 27




---



##### Table of Contents



PORTFOLIO DIVERSIFICATION
 Percentage ofOccupied
    
    TotalNAICS
    
    Square
    
    OccupiedNorth American Industrial Classification System Description
    
    Code
    
    Feet
    
    PortfolioProfessional, Scientific, and Technical Services
    
    
    541
    
    
    
    4,257,588
    
    
    
    25.47
    %Finance and Insurance
    
    
    521-525
    
    
    
    2,961,366
    
    
    
    17.71
    %Information
    
    
    511-519
    
    
    
    1,730,483
    
    
    
    10.35
    %Manufacturing
    
    
    311-339
    
    
    
    1,539,619
    
    
    
    9.21
    %Health Care and Social Assistance
    
    
    621-624
    
    
    
    1,046,246
    
    
    
    6.26
    %Administrative and Support and Waste Management and Remediation Services
    
    
    561-562
    
    
    
    675,379
    
    
    
    4.04
    %Public Administration
    
    
    921-928
    
    
    
    670,065
    
    
    
    4.00
    %Educational Services
    
    
    611
    
    
    
    720,238
    
    
    
    4.31
    %Real Estate, Rental and Leasing
    
    
    531-533
    
    
    
    974,390
    
    
    
    5.83
    %Wholesale Trade
    
    
    423-425
    
    
    
    442,320
    
    
    
    2.64
    %Transportation and Warehousing
    
    
    481-493
    
    
    
    310,803
    
    
    
    1.86
    %Arts, Entertainment, and Recreation
    
    
    711-713
    
    
    
    244,922
    
    
    
    1.46
    %Construction
    
    
    236-238
    
    
    
    332,007
    
    
    
    1.99
    %Accommodation and Food Services
    
    
    721-722
    
    
    
    206,797
    
    
    
    1.24
    %Other Services (except Public Administration)
    
    
    811-814
    
    
    
    235,070
    
    
    
    1.41
    %Retail Trade
    
    
    441-454
    
    
    
    201,704
    
    
    
    1.21
    %Mining
    
    
    211-213
    
    
    
    2,894
    
    
    
    0.02
    %Management of Companies and Enterprises
    
    
    551
    
    
    
    34,410
    
    
    
    0.21
    %Utilities
    
    
    221
    
    
    
    8,975
    
    
    
    0.05
    %Agriculture, Forestry, Fishing and Hunting
    
    
    111-115
    
    
    
    3,595
    
    
    
    0.02
    %Other  Uncategorized
    
    
    
    
    
    
    118,200
    
    
    
    0.71
    %16,717,071
    (1)
    
    
    100.00
    %
 
 (1)
    
    Excludes square footage for tenants occupying six properties classified as held for
disposition at June 30, 2005. 28




---



##### Table of Contents



LEASE EXPIRATIONS  ANNUAL
 2010 and2005
    
    2006
    
    2007
    
    2008
    
    2009
    
    ThereafterLos Angeles County:West
    
    Expiring SF (1)
    
    
    214,856
    
    
    
    645,722
    
    
    
    704,041
    
    
    
    706,244
    
    
    
    715,612
    
    
    
    2,108,416% of Leased SF (2)
    
    
    1.26
    %
    
    
    3.79
    %
    
    
    4.13
    %
    
    
    4.14
    %
    
    
    4.20
    %
    
    
    12.38
    %Rent per SF (3)
    
    $
    28.09
    
    
    $
    29.61
    
    
    $
    28.07
    
    
    $
    29.69
    
    
    $
    27.50
    
    
    $
    33.29North
    
    Expiring SF (1)
    
    
    280,348
    
    
    
    541,788
    
    
    
    567,948
    
    
    
    820,662
    
    
    
    389,725
    
    
    
    564,540% of Leased SF (2)
    
    
    1.64
    %
    
    
    3.18
    %
    
    
    3.34
    %
    
    
    4.82
    %
    
    
    2.29
    %
    
    
    3.32
    %Rent per SF (3)
    
    $
    23.18
    
    
    $
    23.93
    
    
    $
    23.38
    
    
    $
    24.69
    
    
    $
    25.01
    
    
    $
    23.34South
    
    Expiring SF (1)
    
    
    179,384
    
    
    
    218,827
    
    
    
    222,580
    
    
    
    320,025
    
    
    
    287,901
    
    
    
    972,913% of Leased SF (2)
    
    
    1.06
    %
    
    
    1.29
    %
    
    
    1.31
    %
    
    
    1.88
    %
    
    
    1.69
    %
    
    
    5.71
    %Rent per SF (3)
    
    $
    18.81
    
    
    $
    22.12
    
    
    $
    22.79
    
    
    $
    22.58
    
    
    $
    20.56
    
    
    $
    18.99Subtotal  Los Angeles County
    
    Expiring SF (1)
    
    
    674,588
    
    
    
    1,406,337
    
    
    
    1,494,569
    
    
    
    1,846,931
    
    
    
    1,393,238
    
    
    
    3,645,869% of Leased SF (2)
    
    
    3.96
    %
    
    
    8.26
    %
    
    
    8.78
    %
    
    
    10.84
    %
    
    
    8.18
    %
    
    
    21.41
    %Rent per SF (3)
    
    $
    23.58
    
    
    $
    26.26
    
    
    $
    25.50
    
    
    $
    26.24
    
    
    $
    25.37
    
    
    $
    27.93Orange County
    
    Expiring SF (1)
    
    
    200,539
    
    
    
    583,055
    
    
    
    599,757
    
    
    
    362,386
    
    
    
    315,039
    
    
    
    892,092% of Leased SF (2)
    
    
    1.18
    %
    
    
    3.42
    %
    
    
    3.52
    %
    
    
    2.13
    %
    
    
    1.85
    %
    
    
    5.24
    %Rent per SF (3)
    
    $
    21.28
    
    
    $
    20.78
    
    
    $
    18.37
    
    
    $
    19.93
    
    
    $
    21.16
    
    
    $
    24.16San Diego County
    
    Expiring SF (1)
    
    
    265,979
    
    
    
    484,614
    
    
    
    373,123
    
    
    
    504,901
    
    
    
    353,906
    
    
    
    764,299% of Leased SF (2)
    
    
    1.56
    %
    
    
    2.85
    %
    
    
    2.19
    %
    
    
    2.96
    %
    
    
    2.08
    %
    
    
    4.48
    %Rent per SF (3)
    
    $
    17.47
    
    
    $
    24.49
    
    
    $
    26.39
    
    
    $
    27.62
    
    
    $
    25.26
    
    
    $
    26.31All Others
    
    Expiring SF (1)
    
    
    114,964
    
    
    
    139,501
    
    
    
    42,492
    
    
    
    65,538
    
    
    
    91,016
    
    
    
    96,747% of Leased SF (2)
    
    
    0.68
    %
    
    
    0.82
    %
    
    
    0.25
    %
    
    
    0.39
    %
    
    
    0.53
    %
    
    
    0.57
    %Rent per SF (3)
    
    $
    20.29
    
    
    $
    21.15
    
    
    $
    20.99
    
    
    $
    21.97
    
    
    $
    18.03
    
    
    $
    22.69Total Portfolio(4)
    
    Expiring SF (1)
    
    
    1,256,070
    
    
    
    2,613,507
    
    
    
    2,509,941
    
    
    
    2,779,756
    
    
    
    2,153,199
    
    
    
    5,399,007% of Leased SF (2)
    
    
    7.38
    %
    
    
    15.35
    %
    
    
    14.74
    %
    
    
    16.32
    %
    
    
    12.64
    %
    
    
    31.70
    %Rent per SF (3)
    
    $
    21.62
    
    
    $
    24.44
    
    
    $
    23.85
    
    
    $
    25.57
    
    
    $
    24.43
    
    
    $
    26.99
 
 (1)
    
    Represents the square footage of expiring leases, not including month-to-month
tenants.(2)
    
    Percentage of total rentable square footage expiring during the period.(3)
    
    Represents annualized ending cash rents of expiring leases.(4)
    
    Excludes six properties currently classified as held for disposition as of June
30, 2005. QUARTERLY LEASE EXPIRATIONS  NEXT FOUR QUARTERS
 Q3-05
    
    Q4-05
    
    Q1-06
    
    Q2-06Los Angeles County:West
    
    Expiring SF (1)
    
    
    65,863
    
    
    
    148,993
    
    
    
    208,450
    
    
    
    65,387% of Leased SF (2)
    
    
    0.39
    %
    
    
    0.87
    %
    
    
    1.22
    %
    
    
    0.39
    %Rent per SF (3)
    
    $
    24.77
    
    
    $
    29.56
    
    
    $
    27.08
    
    
    $
    26.88North
    
    Expiring SF (1)
    
    
    139,540
    
    
    
    140,808
    
    
    
    125,915
    
    
    
    109,006% of Leased SF (2)
    
    
    0.82
    %
    
    
    0.82
    %
    
    
    0.74
    %
    
    
    0.64
    %Rent per SF (3)
    
    $
    22.40
    
    
    $
    23.95
    
    
    $
    23.58
    
    
    $
    23.83South
    
    Expiring SF (1)
    
    
    96,716
    
    
    
    82,668
    
    
    
    37,102
    
    
    
    77,117% of Leased SF (2)
    
    
    0.57
    %
    
    
    0.49
    %
    
    
    0.22
    %
    
    
    0.45
    %Rent per SF (3)
    
    $
    16.49
    
    
    $
    21.53
    
    
    $
    21.24
    
    
    $
    22.37Subtotal  Los Angeles County
    
    Expiring SF (1)
    
    
    302,119
    
    
    
    372,469
    
    
    
    371,467
    
    
    
    251,510% of Leased SF (2)
    
    
    1.78
    %
    
    
    2.18
    %
    
    
    2.18
    %
    
    
    1.48
    %Rent per SF (3)
    
    $
    21.03
    
    
    $
    25.66
    
    
    $
    25.31
    
    
    $
    24.18Orange County
    
    Expiring SF (1)
    
    
    62,472
    
    
    
    138,067
    
    
    
    89,149
    
    
    
    210,633% of Leased SF (2)
    
    
    0.37
    %
    
    
    0.81
    %
    
    
    0.53
    %
    
    
    1.24
    %Rent per SF (3)
    
    $
    21.65
    
    
    $
    21.11
    
    
    $
    15.00
    
    
    $
    20.64San Diego County
    
    Expiring SF (1)
    
    
    107,512
    
    
    
    158,467
    
    
    
    97,614
    
    
    
    136,848% of Leased SF (2)
    
    
    0.63
    %
    
    
    0.93
    %
    
    
    0.57
    %
    
    
    0.80
    %Rent per SF (3)
    
    $
    24.96
    
    
    $
    12.39
    
    
    $
    26.44
    
    
    $
    21.91All Others
    
    Expiring SF (1)
    
    
    54,723
    
    
    
    60,241
    
    
    
    30,652
    
    
    
    8,510% of Leased SF (2)
    
    
    0.32
    %
    
    
    0.36
    %
    
    
    0.18
    %
    
    
    0.05
    %Rent per SF (3)
    
    $
    20.12
    
    
    $
    20.45
    
    
    $
    20.01
    
    
    $
    19.68Total Portfolio(4)
    
    Expiring SF (1)
    
    
    526,826
    
    
    
    729,244
    
    
    
    588,882
    
    
    
    607,501% of Leased SF (2)
    
    
    3.10
    %
    
    
    4.28
    %
    
    
    3.46
    %
    
    
    3.57
    %Rent per SF (3)
    
    $
    21.81
    
    
    $
    21.48
    
    
    $
    23.66
    
    
    $
    22.38
 
 (1)
    
    Represents the square footage of expiring leases, not including month-to-month
tenants.(2)
    
    Percentage of total rentable square footage expiring during the period.(3)
    
    Represents annualized ending cash rents of expiring leases.(4)
    
    Excludes six properties currently classified as held for disposition as of June 30,
2005. 29




---



##### Table of Contents



Development
     
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
  Interest Rate Risk
        30




---



##### Table of Contents



Item 4. Controls and Procedures
    31




---



##### Table of Contents



Part II OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds  None
 
 Item 3. Defaults Upon Senior Securities  None
 
 Item 4. Submission of Matters to a Vote of Security Holders
  1.
    
    To elect directors of Arden Realty, Inc. to hold office until the annual
meeting of shareholders in the year 2008 or until their respective successors are
elected and qualified as follows:
 Number of Shares Voted For
    
    Number of Shares WithheldDirector #1 - Richard S. Ziman
    
    
    41,544,617
    
    
    
    18,473,684Director #2 - Victor J. Coleman
    
    
    41,538,376
    
    
    
    18,479,925
 2.
    
    To ratify appointment of Ernst & Young LLP to act as independent auditors
for the year ending December 31, 2005.
 Number of Shares
    
    Number of Shares
    
    Number of SharesVoted For
    
    Voted Against
    
    Abstained59,358,862
    
    625,381
    
    34,058
 3.
    
    To adopt the Third Amended and Restated 1996 Stock Option and Incentive
Plan of Arden Realty, Inc. and Arden Realty Limited Partnership. The amendment
provides for:
 
    
    An increase in the number of common shares reserved for issuance under the
plan from 6,500,000 to 8,500,000; and
    
    An extension of the term of the plan, so that no additional grants of
awards may be made under the plan after the tenth anniversary of its adoption
by our Board of Directors on March 22, 2005.
 Number of Shares
    
    Number of Shares
    
    Number of SharesVoted For
    
    Voted Against
    
    Abstained52,960,766
    
    2,484,256
    
    65,890
 4.
    
    To establish policy to seek shareholder approval for future severance
payments with senior executives in excess of 2.99 times the sum of the executives
annual base salary.
 Number of Shares
    
    Number of Shares
    
    Number of SharesVoted For
    
    Voted Against
    
    Abstained44,025,785
    
    11,393,776
    
    91,351
 
 Item 5. Other Information  None
 32




---



##### Table of Contents



Item 6. Exhibits
 ExhibitNumber
    
    Description10.1
    
    Summary of Director Restricted Stock Awards, incorporated herein by reference to Item 1.01 of the Registrants
current report on Form 8-K filed with the Commission on April 15, 2005.10.2
    
    Summary of Increase in Director Retainer, incorporated herein by reference to Item 1.01 of the Registrants
current report on Form 8-K filed with the Commission on April 15, 2005.10.3
    
    Summary of Increase in Director Fees, incorporated herein by reference to Item 1.01 of the Registrants
current report on Form 8-K filed with the Commission on April 15, 2005.10.4
    
    Summary of Establishment of Fiscal 2005 Base Salaries for certain senior executives of the Registrant,
incorporated herein by reference to Item 1.01 of the Registrants current report on Form 8-K filed with the
Commission on April 15, 2005.10.5
    
    Summary of Executive Restricted Stock Awards for certain senior executives of the Registrant, incorporated
herein by reference to Item 1.01 of the Registrants current report on Form 8-K filed with the Commission on
April 15, 2005.10.6
    
    Description of the Outperformance Plan, incorporated herein by reference to Item 1.01 of the Registrants
current report on Form 8-K filed with the Commission on April 15, 2005.10.7
    
    Form of Restricted Stock Agreement, incorporated herein by reference to Exhibit 10.1 to the Registrants
current report on Form 8-K filed with the Commission on April 15, 2005.10.8
    
    Form of Performance-Based Restricted Stock Agreement, incorporated herein by reference to Exhibit 10.2 to the
Registrants current report on Form 8-K filed with the Commission on April 15, 2005.10.9
    
    Amended and Restated Arden Realty Limited Partnership Deferred Compensation Plan, dated July 1, 2005,
incorporated herein by reference to Exhibit 10.1 to the Registrants current report on Form 8-K filed with the
Commission on May 24, 2005.31.1
    
    Certificate of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certificate of Chief Financial Officer and Other Executive Officers pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    Certificate of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(1)32.2
    
    Certificate of Chief Financial Officer and Other Executive Officers pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.(1)
 
 (1)
    
    In accordance with SEC Release No. 33-8212, the following exhibit is being furnished, and
is not being filed as part of this Report on Form 10-Q or as a separate
disclosure document, and is not being incorporated by reference into any Securities Act of
1933 registration statement. 33




---



##### Table of Contents



SIGNATURES
  ARDEN REALTY, INC.Date: August 5, 2005
    By:
    /s/ Robert C. PeddicordRobert C. PeddicordExecutive Vice President,
Leasing and Property Operations Date: August 5, 2005
    By:
    /s/ Richard S. DavisRichard S. DavisExecutive Vice President and
Chief Financial Officer 34