<PAGE>   1

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q


[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934
     FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2001
[ ]  Transition report pursuant to Section 13 or 15(d) of the Securities
     Exchange Act of 1934


                           --------------------------
                        Commission File Number 333-21873
                           --------------------------


                             FIRST INDUSTRIAL, L.P.
             (Exact Name of Registrant as Specified in its Charter)


           DELAWARE                                               36-3924586
(State or Other Jurisdiction of                               (I.R.S. Employer
Incorporation or Organization)                               Identification No.)


            311 S. WACKER DRIVE, SUITE 4000, CHICAGO, ILLINOIS 60606
                    (Address of Principal Executive Offices)



                                 (312) 344-4300
              (Registrant's Telephone Number, Including Area Code)





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

<PAGE>   2

                             FIRST INDUSTRIAL, L.P.
                                    FORM 10-Q
                       FOR THE PERIOD ENDED JUNE 30, 2001

                                      INDEX



                                                                         PAGE
PART I:  FINANCIAL INFORMATION

 Item 1.  Financial Statements


     Consolidated Balance Sheets as of June 30, 2001 and December 31,
     2000................................................................  2

     Consolidated Statements of Operations for the Six Months Ended
     June 30, 2001 and June 30, 2000.....................................  3

     Consolidated Statements of Operations for the Three Months Ended
     June 30, 2001 and June 30, 2000.....................................  4

     Consolidated Statements of Cash Flows for the Six Months Ended
     June 30, 2001 and June 30, 2000.....................................  5

     Notes to Consolidated Financial Statements .........................  6-17


 Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations .......................  18-27

 Item 3.  Quantitative and Qualitative Disclosures About Market
              Risk ......................................................  27


PART II:  OTHER INFORMATION

 Item 1.  Legal Proceedings .............................................  28
 Item 2.  Changes in Securities .........................................  28
 Item 3.  Defaults Upon Senior Securities................................  28
 Item 4.  Submission of Matters to a Vote of Security Holders ...........  28
 Item 5.  Other Information .............................................  28
 Item 6.  Exhibits and Report on Form 8-K................................  28



SIGNATURE ...............................................................  29


EXHIBIT INDEX............................................................  30


                                       1
<PAGE>   3

                          PART I. FINANCIAL INFORMATION
                          ITEM 1. FINANCIAL STATEMENTS
                             FIRST INDUSTRIAL, L.P.
                           CONSOLIDATED BALANCE SHEETS
                             (DOLLARS IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                           June 30,     December 31,
                                                                            2001            2000
                                                                         -----------    ------------
<S>                                                                      <C>            <C>
                                     ASSETS
Assets:
   Investment in Real Estate:
      Land ...........................................................   $   354,434    $   341,746
      Buildings and Improvements .....................................     1,663,177      1,643,540
      Furniture, Fixtures and Equipment ..............................         1,249          1,353
      Construction in Progress .......................................        67,486         33,913
      Less: Accumulated Depreciation .................................      (196,096)      (182,480)
                                                                         -----------    -----------
              Net Investment in Real Estate ..........................     1,890,250      1,838,072

   Real Estate Held for Sale, Net of Accumulated Depreciation and
     Amortization of $19,801 at June 30, 2001 and $21,974 at
     December 31, 2000 ...............................................       149,975        190,379
   Investments in and Advances to Other Real Estate Partnerships .....       393,578        381,231
   Cash and Cash Equivalents .........................................         5,119          3,644
   Restricted Cash ...................................................        50,910         23,027
   Tenant Accounts Receivable, Net ...................................         7,866          8,857
   Investments in Joint Ventures .....................................         5,992          6,158
   Deferred Rent Receivable ..........................................        11,372         10,887
   Deferred Financing Costs, Net .....................................        10,972         10,543
   Prepaid Expenses and Other Assets, Net ............................        58,543         66,609
                                                                         -----------    -----------
              Total Assets ...........................................   $ 2,584,577    $ 2,539,407
                                                                         ===========    ===========

                LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
   Mortgage Loans Payable, Net .......................................   $    48,775    $    61,242
   Senior Unsecured Debt, Net ........................................     1,048,423        948,781
   Acquisition Facility Payable ......................................       141,000        170,000
   Accounts Payable and Accrued Expenses .............................        77,515         94,448
   Rents Received in Advance and Security Deposits ...................        20,062         17,593
   Distributions Payable .............................................        37,899         37,512
                                                                         -----------    -----------
              Total Liabilities ......................................     1,373,674      1,329,576
                                                                         -----------    -----------

Commitments and Contingencies ........................................           ---            ---

Partners' Capital:
    General Partner Preferred Units (140,000 units issued and
      outstanding at June 30, 2001 and December 31, 2000) ............       336,990        336,990
    General Partner Units (39,534,652 and 38,844,086 units issued
      and outstanding at June 30, 2001 and December 31, 2000,
      respectively) ..................................................       714,126        697,864
    Unamortized Value of General Partnership Restricted Units ........        (8,981)        (8,812)
    Limited Partners' Units (7,108,600 and 7,223,859 units issued
      and outstanding at June 30, 2001 and December 31, 2000,
      respectively) ..................................................       180,062        183,406
    Amortization of Stock Based Compensation .........................           959            383
    Accumulated Other Comprehensive Loss .............................       (12,253)           ---
                                                                         -----------    -----------
                Total Partners' Capital ..............................     1,210,903      1,209,831
                                                                         -----------    -----------
                Total Liabilities and Partners' Capital ..............   $ 2,584,577    $ 2,539,407
                                                                         ===========    ===========
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                                       2
<PAGE>   4


                             FIRST INDUSTRIAL, L.P.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                Six Months        Six Months
                                                                                  Ended             Ended
                                                                              June 30, 2001      June 30, 2000
                                                                              -------------      -------------
<S>                                                                           <C>                <C>
Revenues:
   Rental Income .........................................................      $ 123,967         $ 124,668
   Tenant Recoveries and Other Income ....................................         39,125            33,421
                                                                                ---------         ---------
             Total Revenues ..............................................        163,092           158,089
                                                                                ---------         ---------

Expenses:
   Real Estate Taxes .....................................................         25,461            25,603
   Repairs and Maintenance ...............................................          9,212             7,863
   Property Management ...................................................          5,865             6,154
   Utilities .............................................................          4,692             3,808
   Insurance .............................................................          1,024               549
   Other .................................................................          2,132             2,410
   General and Administrative ............................................          9,182             7,426
   Interest Expense ......................................................         40,396            38,559
   Amortization of Deferred Financing Costs ..............................            865               865
   Depreciation and Other Amortization ...................................         28,563            29,638
                                                                                ---------         ---------
              Total Expenses .............................................        127,392           122,875
                                                                                ---------         ---------

Income from Operations Before Equity in Income of Other Real
    Estate Partnerships and Equity in Income of Joint Ventures ...........         35,700            35,214
Equity in Income of Other Real Estate Partnerships .......................         23,988            18,131
Equity in Income of Joint Ventures .......................................            436               119
                                                                                ---------         ---------
Income from Operations ...................................................         60,124            53,464
Gain on Sale of Real Estate ..............................................         21,612            12,145
                                                                                ---------         ---------
Income Before Extraordinary Loss .........................................         81,736            65,609
Extraordinary Loss .......................................................        (10,309)              ---
                                                                                ---------         ---------
Net Income ...............................................................         71,427            65,609
Less:  Preferred Unit Distributions ......................................        (14,462)          (14,462)
                                                                                ---------         ---------
Net Income Available to Unitholders ......................................      $  56,965         $  51,147
                                                                                =========         =========

Net Income Available to Unitholders Before Extraordinary Loss Per
   Weighted Average Unit Outstanding:
           Basic .........................................................      $    1.45         $    1.12
                                                                                =========         =========
           Diluted .......................................................      $    1.44         $    1.11
                                                                                =========         =========

Net Income Available to Unitholders Per Weighted Average Unit
   Outstanding:
           Basic .........................................................      $    1.23         $    1.12
                                                                                =========         =========
           Diluted .......................................................      $    1.22         $    1.11
                                                                                =========         =========

Net Income ...............................................................      $  71,427         $  65,609
Other Comprehensive Income (Loss):
           Cumulative Transition Adjustment ..............................        (14,920)              ---
           Settlement of Interest Rate Protection Agreements .............           (191)              ---
           Write-off of Unamortized Interest Rate Protection Agreement
                 Due to the Early Retirement of Debt .....................          2,156               ---
           Amortization of Interest Rate Protection Agreements ...........            702               ---
                                                                                ---------         ---------
Comprehensive Income .....................................................      $  59,174         $  65,609
                                                                                =========         =========
</TABLE>

    The accompanying notes are an integral part of the financial statements.

                                       3
<PAGE>   5
                             FIRST INDUSTRIAL, L.P.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                              Three Months      Three Months
                                                                                 Ended              Ended
                                                                             June 30, 2001     June 30, 2000
                                                                             -------------     -------------
<S>                                                                          <C>               <C>
Revenues:
   Rental Income .........................................................      $ 61,959          $ 62,281
   Tenant Recoveries and Other Income ....................................        18,197            16,041
                                                                                --------          --------
             Total Revenues ..............................................        80,156            78,322
                                                                                --------          --------

Expenses:
   Real Estate Taxes .....................................................        12,475            12,256
   Repairs and Maintenance ...............................................         4,124             3,882
   Property Management ...................................................         2,893             3,329
   Utilities .............................................................         1,881             1,802
   Insurance .............................................................           519               398
   Other .................................................................         1,105             1,208
   General and Administrative ............................................         4,864             3,872
   Interest Expense ......................................................        19,936            19,533
   Amortization of Deferred Financing Costs ..............................           440               453
   Depreciation and Other Amortization ...................................        14,196            14,754
                                                                                --------          --------
              Total Expenses .............................................        62,433            61,487
                                                                                --------          --------

Income from Operations Before Equity in Income of Other Real
    Estate Partnerships and Equity in Income of Joint Ventures ...........        17,723            16,835
Equity in Income of Other Real Estate Partnerships .......................        14,693            11,323
Equity in Income of Joint Ventures .......................................           250                88
                                                                                --------          --------
Income from Operations ...................................................        32,666            28,246
Gain on Sale of Real Estate ..............................................         9,693             6,257
                                                                                --------          --------
Income Before Extraordinary Loss .........................................        42,359            34,503
Extraordinary Loss .......................................................       (10,309)              ---
                                                                                --------          --------
Net Income ...............................................................        32,050            34,503
Less:  Preferred Unit Distributions ......................................        (7,231)           (7,231)
                                                                                --------          --------
Net Income Available to Unitholders ......................................      $ 24,819          $ 27,272
                                                                                ========          ========

Net Income Available to Unitholders Before Extraordinary Loss Per
   Weighted Average Unit Outstanding:
           Basic .........................................................      $    .75          $    .59
                                                                                ========          ========
           Diluted .......................................................      $    .75          $    .59
                                                                                ========          ========

Net Income Available to Unitholders per Weighted Average Unit
   Outstanding:
           Basic .........................................................      $    .53          $    .59
                                                                                ========          ========
           Diluted .......................................................      $    .53          $    .59
                                                                                ========          ========

Net Income ...............................................................      $ 32,050          $ 34,503
Other Comprehensive Income (Loss):
           Settlement of Interest Rate Protection Agreement, Net .........          (425)              ---
           Write-off of Interest Rate Protection Agreement Due to the
                  Early Retirement of Debt ...............................         2,156               ---
           Amortization of Interest Rate Protection Agreements ...........           612               ---
                                                                                --------          --------
Comprehensive Income .....................................................      $ 34,393          $ 34,503
                                                                                ========          ========
</TABLE>


    The accompanying notes are an integral part of the financial statements.


                                       4
<PAGE>   6

                             FIRST INDUSTRIAL, L.P.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (DOLLARS IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                Six Months Ended     Six Months Ended
                                                                 June 30, 2001        June 30, 2000
                                                                ----------------     ----------------
<S>                                                             <C>                  <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net Income ..............................................        $  71,427           $  65,609
   Adjustments to Reconcile Net Income to Net Cash
         Provided by Operating Activities:
    Depreciation ...........................................           24,523              26,655
    Amortization of Deferred Financing Costs ...............              865                 865
    Other Amortization .....................................            6,783               4,362
    Equity in Income of Joint Ventures .....................             (436)               (119)
    Distributions from Joint Ventures ......................              436                 119
    Gain on Sale of Real Estate ............................          (21,612)            (12,145)
    Extraordinary Loss .....................................           10,309                 ---
    Equity in Income of Other Real Estate Partnerships .....          (23,988)            (18,131)
    Distributions from Investment in Other Real Estate
         Partnerships ......................................           23,988              18,131
    Increase in Tenant Accounts Receivable and Prepaid
         Expenses and Other Assets, Net ....................           (6,658)            (18,570)
    Increase in Deferred Rent Receivable ...................           (1,103)               (519)
    (Decrease) Increase in Accounts Payable and  Accrued
         Expenses and Rents Received  in Advance
         and Security Deposits .............................          (10,697)              2,762
                                                                    ---------           ---------
          Net Cash Provided by Operating Activities ........           73,837              69,019
                                                                    ---------           ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Purchases of and Additions to Investment in
         Real Estate .......................................         (175,433)           (150,545)
    Net Proceeds from Sales of Investment in Real
         Estate ............................................          161,575             103,013
    Investments in and Advances to Other Real
         Estate Partnerships ...............................          (75,066)            (43,799)
    Distributions from Other Real Estate Partnerships ......           62,719              22,430
    Contributions to and Investments in Joint Venture ......              ---                 (37)
    Distributions from Joint Ventures ......................              166                 367
    Funding of Mortgage Loans Receivable ...................          (27,588)                ---
    Repayment of Mortgage Loans Receivable .................           23,071              12,813
    Increase in Restricted Cash ............................          (27,883)            (10,960)
                                                                    ---------           ---------
         Net Cash Used in Investing Activities .............          (58,439)            (66,718)
                                                                    ---------           ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Unit Contributions ......................................           13,936               6,667
   Unit Distributions ......................................          (60,812)            (56,626)
   Repurchase of Restricted Units ..........................           (1,638)                ---
   Preferred Unit Distributions ............................          (14,462)            (14,462)
   Repayments on Mortgage Loans Payable ....................          (12,449)               (875)
   Proceeds from Senior Unsecured Debt .....................          199,390                 ---
   Repayment of Senior Unsecured Debt ......................         (100,000)                ---
   Proceeds from Acquisition Facilities Payable ............          297,300             111,000
   Repayments on Acquisition Facilities Payable ............         (326,300)            (43,200)
   Cost of Debt Issuance and Prepayment Fees ...............           (8,888)             (2,280)
                                                                    ---------           ---------
          Net Cash (Used in) Provided by Financing
               Activities ..................................          (13,923)                224
                                                                    ---------           ---------
   Net Increase in Cash and Cash Equivalents ...............            1,475               2,525
   Cash and Cash Equivalents, Beginning of Period ..........            3,644                  22
                                                                    ---------           ---------
   Cash and Cash Equivalents, End of Period ................        $   5,119           $   2,547
                                                                    =========           =========
</TABLE>

    The accompanying notes are an integral part of the financial statements.


                                       5
<PAGE>   7

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

1.       ORGANIZATION AND FORMATION OF PARTNERSHIP


         First Industrial, L.P. (the "Operating Partnership") was organized as a
limited partnership in the state of Delaware on November 23, 1993. The sole
general partner is First Industrial Realty Trust, Inc. (the "Company") with an
approximate 84.8% ownership interest at June 30, 2001. The Company also owns a
preferred general partnership interest in the Operating Partnership with an
aggregate liquidation priority of $350,000. The Company is a real estate
investment trust ("REIT") as defined in the Internal Revenue Code. The Company's
operations are conducted primarily through the Operating Partnership. The
limited partners of the Operating Partnership own, in the aggregate,
approximately a 15.2% interest in the Operating Partnership at June 30, 2001.

         The Operating Partnership is the sole member of several limited
liability companies (the "L.L.C.s") and the sole stockholder of First Industrial
Development Services, Inc. (f/k/a FR Development Services, Inc.), and holds at
least a 99% limited partnership interest (subject in one case, as described
below, to a preferred limited partnership interest) in each of eight limited
partnerships (together, the "Other Real Estate Partnerships"). The Operating
Partnership, through separate wholly-owned limited liability companies in which
it is the sole member, also owns 10% equity interests in and provides asset and
property management services to, two joint ventures which invest in industrial
properties (the "September 1998 Joint Venture" and the "September 1999 Joint
Venture").

         The general partners of the Other Real Estate Partnerships are separate
corporations, each with at least a .01% general partnership interest in the
Other Real Estate Partnerships for which it acts as a general partner. Each
general partner of the Other Real Estate Partnerships is a wholly-owned
subsidiary of the Company.

         The consolidated financial statements of the Operating Partnership
report the L.L.C.s and First Industrial Development Services, Inc. (hereinafter
defined as the "Consolidated Operating Partnership") on a consolidated basis.
The Other Real Estate Partnerships, the September 1998 Joint Venture and the
September 1999 Joint Venture are accounted for under the equity method of
accounting. As of June 30, 2001, the Consolidated Operating Partnership owned
838 in-service properties containing an aggregate of approximately 53.5 million
square feet of gross leasable area ("GLA"). On a combined basis, as of June 30,
2001, the Other Real Estate Partnerships owned 109 in-service properties
containing an aggregate of approximately 12.3 million square feet of GLA.

         Profits, losses and distributions of the Operating Partnership, the
L.L.C.s and the Other Real Estate Partnerships are allocated to the general
partner and the limited partners, or the members, as applicable, in accordance
with the provisions contained within the partnership agreements or ownership
agreements, as applicable, of the Operating Partnership, the L.L.C.s and the
Other Real Estate Partnerships.


                                       6
<PAGE>   8

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


         The accompanying unaudited interim financial statements have been
prepared in accordance with the accounting policies described in the financial
statements and related notes included in the Operating Partnership's 2000 Form
10-K/A No. 1 and should be read in conjunction with such financial statements
and related notes. The following notes to these interim financial statements
highlight significant changes to the notes included in the December 31, 2000
audited financial statements included in the Operating Partnership's 2000 Form
10-K/A No. 1 and present interim disclosures as required by the Securities and
Exchange Commission.

         In order to conform with generally accepted accounting principles,
management, in preparation of the Consolidated Operating Partnership's financial
statements, is required to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities as of June 30, 2001 and December 31, 2000, and the reported
amounts of revenues and expenses for each of the six months and three months
ended June 30, 2001 and 2000. Actual results could differ from those estimates.

         In the opinion of management, all adjustments consist of normal
recurring adjustments necessary for a fair statement of the financial position
of the Consolidated Operating Partnership as of June 30, 2001 and the results of
its operations for each of the six months and three months ended June 30, 2001
and 2000 and its cash flows for the six months ended June 30, 2001 and 2000.

Tenant Accounts Receivable, Net:

         The Consolidated Operating Partnership provides an allowance for
doubtful accounts against the portion of tenant accounts receivable which is
estimated to be uncollectible. Tenant accounts receivable in the consolidated
balance sheets are shown net of an allowance for doubtful accounts of $1,707 as
of June 30, 2001 and December 31, 2000.

Recent Accounting Pronouncements:

         On January 1, 2001, the Consolidated Operating Partnership adopted the
Financial Accounting Standards Board's Statement of Financial Accounting
Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities" ("FAS 133"), as amended by Statement of Financial Accounting
Standards No. 138, "Accounting for Derivative Instruments and Hedging
Activities- An Amendment of FAS Statement 133". FAS 133, as amended, establishes
accounting and reporting standards for derivative instruments. Specifically, FAS
133, as amended, requires an entity to recognize all derivatives as either
assets or liabilities in the statement of financial position and to measure
those instruments at fair value. Additionally, the fair value adjustment will
affect either other comprehensive income (shareholders' equity) or net income,
depending on whether the derivative instrument qualifies as a hedge for
accounting purposes and, if so, the nature of the hedging activity. FAS 133, as
amended, also requires that any gains or losses on derivative instruments that
are reported independently as deferred gains or losses (assets or liabilities)
in the statement of financial position at the date of initial application shall
be derecognized and reported as a cumulative transition adjustment in other
comprehensive income.


                                       7
<PAGE>   9

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED


         In conjunction with prior issuances of senior unsecured debt, the
Consolidated Operating Partnership, through the Operating Partnership, entered
into interest rate protection agreements to fix the interest rate on anticipated
offerings of unsecured debt. On January 1, 2001, the Consolidated Operating
Partnership, through the Operating Partnership, derecognized the deferred
settlement amounts relating to these settled interest rate protection agreements
and recorded in other comprehensive income a cumulative transition adjustment
expense of approximately $14,920. The Consolidated Operating Partnership,
through the Operating Partnership, will amortize approximately $214 into net
income as an adjustment to interest expense in the next twelve months relating
to these interest rate protection agreements.

         In March 2001, the Consolidated Operating Partnership, through the
Operating Partnership, entered into an interest rate protection agreement which
fixed the interest rate on a forecasted offering of unsecured debt which it
designated as a cash flow hedge. In conjunction with the offering of the 2011
Notes (as defined in footnote 5), the Consolidated Operating Partnership,
through the Operating Partnership, settled this interest rate protection
agreement and received approximately $371, which is shown in other comprehensive
income. The Consolidated Operating Partnership, through the Operating
Partnership, is amortizing this settlement amount into net income as an
adjustment to interest expense over the life of the 2011 Notes (as defined in
footnote 5). The Consolidated Operating Partnership, through the Operating
Partnership, will amortize approximately $37 into net income as an adjustment to
interest expense in the next twelve months relating to this interest rate
protection agreement.

         In March 2001, the Consolidated Operating Partnership, through the
Operating Partnership, entered into an interest rate protection agreement which
fixed the retirement price on a forecasted retirement of unsecured debt which it
designated as a cash flow hedge. In conjunction with the retirement of the 2011
Drs. (as defined in footnote 5) in April 2001, the Consolidated Operating
Partnership, through the Operating Partnership, settled this interest rate
protection agreement for a payment of approximately $562 which is a component of
the extraordinary loss the Consolidated Operating Partnership, through the
Operating Partnership, has recognized relating to the retirement of the 2011
Drs. (as defined in footnote 5).

         The following is a roll-forward of the accumulated other comprehensive
income balance relating to these derivative transactions:

           Balance at December 31, 2000.............................   $    ---
             Cumulative Transition Adjustment.......................    (14,920)
             Settlement of Interest Rate Protection Agreements......       (191)
             Write-off of Unamortized Interest Rate Protection
               Agreements Due to the Early Retirement of Debt.......      2,156
             Amortization of Interest Rate Protection Agreements....
                                                                            702
                                                                       --------
           Balance at June 30, 2001.................................   $(12,253)
                                                                       ========


Reclassification:

         Certain 2000 items have been reclassified to conform to the 2001
presentation.


                                       8
<PAGE>   10

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

3.       INVESTMENTS IN AND ADVANCES TO OTHER REAL ESTATE PARTNERSHIPS

         The investments in and advances to Other Real Estate Partnerships
reflects the Operating Partnership's limited partnership equity interests in the
entities referred to in Note 1 to these financial statements.

         Summarized condensed financial information as derived from the
financial statements of the Other Real Estate Partnerships is presented below:

Condensed Combined Balance Sheets:

                                                       June 30,   December 31,
                                                          2001       2000
                                                       --------   ------------
                       ASSETS
Assets:
   Investment in Real Estate, Net ................     $379,391     $383,021
   Real Estate Held for Sale, Net ................       26,971       46,043
   Other Assets, Net .............................       31,094       40,218
                                                       --------     --------
      Total Assets ...............................     $437,456     $469,282
                                                       ========     ========

         LIABILITIES AND PARTNERS' CAPITAL

Liabilities:
   Mortgage Loans  Payable .......................     $ 41,032     $ 41,333
   Other Liabilities .............................       37,951       40,714
                                                       --------     --------
      Total Liabilities ..........................       78,983       82,047
                                                       --------     --------
   Partners' Capital .............................      358,473      387,235
                                                       --------     --------
      Total Liabilities and Partners' Capital ....     $437,456     $469,282
                                                       ========     ========

Condensed Combined Statements of Operations:

<TABLE>
<CAPTION>
                                                     Six Months Ended           Three Months Ended
                                                  ----------------------      ----------------------
                                                  June 30,      June 30,      June 30,      June 30,
                                                    2001          2000          2001          2000
                                                  --------      --------      --------      --------
<S>                                               <C>           <C>           <C>           <C>
Total Revenues ..............................     $ 33,677      $ 31,284      $ 17,290      $ 15,924
Property Expenses ...........................       (8,297)       (7,639)       (4,053)       (3,731)
General and Administrative ..................          ---          (112)          ---           (43)
Interest Expense ............................       (2,237)       (1,517)       (1,495)         (758)
Amortization of Deferred Financing Costs ....          (33)          (34)          (16)          (18)
Depreciation and Other Amortization .........       (5,911)       (5,524)       (2,924)       (2,787)
Gain on Sale of Real Estate .................        8,086         3,786         6,129         3,800
                                                  --------      --------      --------      --------
Net Income ..................................     $ 25,285      $ 20,244      $ 14,931      $ 12,387
                                                  ========      ========      ========      ========
</TABLE>


                                       9
<PAGE>   11


                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

4.       INVESTMENTS IN JOINT VENTURES

         During the six months ended June 30, 2001, the Consolidated Operating
Partnership, through wholly-owned limited liability companies in which the
Operating Partnership is the sole member, received, in the aggregate,
approximately $1,238 in asset management and property management fees from the
September 1998 Joint Venture and the September 1999 Joint Venture, collectively.
The Operating Partnership, through wholly-owned limited liability companies in
which it is the sole member, received distributions of approximately $544 and
$58 from the September 1998 Joint Venture and the September 1999 Joint Venture,
respectively. As of June 30, 2001, the September 1998 Joint Venture owned 121
industrial properties comprising approximately 6.3 million square feet of GLA
and the September 1999 Joint Venture owned 39 industrial properties comprising
approximately 1.2 million square feet of GLA.

5.       MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND ACQUISITION
         FACILITY PAYABLE

Mortgage Loans Payable, Net:

         On October 23, 1997, the Consolidated Operating Partnership, through
the Operating Partnership, assumed a mortgage loan in the amount of $4,153 (the
"Acquisition Mortgage Loan I") in conjunction with the acquisition of a
portfolio of properties. The Acquisition Mortgage Loan I was collateralized by a
property in Bensenville, Illinois, bore interest at a fixed rate of 8.5% and
provided for monthly principal and interest payments based upon a 15-year
amortization schedule. On May 31, 2001, the Consolidated Operating Partnership,
through the Operating Partnership, paid off and retired the Acquisition Mortgage
Loan I. Due to the retirement of the Acquisition Mortgage Loan I, the Operating
Partnership has recorded an extraordinary loss of approximately $128 due to a
prepayment fee.

         On December 9, 1997, the Consolidated Operating Partnership, through
the Operating Partnership, assumed a mortgage loan in the amount of $7,997 (the
"Acquisition Mortgage Loan II") in conjunction with the acquisition of a
portfolio of properties. The Acquisition Mortgage Loan II was collateralized by
ten properties in St. Charles, Louisiana, bore interest at a fixed rate of 7.75%
and provided for monthly principal and interest payments based upon a 22-year
amortization schedule. On June 27, 2001, the Consolidated Operating Partnership,
through the Operating Partnership, paid off and retired the Acquisition Mortgage
Loan II. Due to the retirement of the Acquisition Mortgage Loan II, the
Operating Partnership has recorded an extraordinary loss of approximately $936
due to a prepayment fee.

Senior Unsecured Debt, Net:

         On March 19, 2001, the Consolidated Operating Partnership, through the
Operating Partnership, issued $200,000 of senior unsecured debt which matures on
March 15, 2011 and bears a coupon interest rate of 7.375% (the "2011 Notes").
The issue price of the 2011 Notes was 99.695%. Interest is paid semi-annually in
arrears on September 15 and March 15. The Consolidated Operating Partnership,
through the Operating Partnership, also entered into an interest rate protection
agreement which was used to fix the interest rate on the 2011 Notes prior to
issuance. The Consolidated Operating Partnership, through the Operating
Partnership, settled the interest rate protection agreement for approximately
$371 of proceeds which is included in other comprehensive income. The debt issue
discount and the settlement amount of the interest rate protection agreement are
being amortized over the life of the 2011 Notes as an adjustment to interest
expense. The 2011 Notes contain certain covenants including limitations on
incurrence of debt and debt service coverage.


                                       10
<PAGE>   12

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

5.       MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND ACQUISITION
         FACILITY PAYABLE, CONTINUED

         On March 31, 1998, the Consolidated Operating Partnership, through the
Operating Partnership, issued $100,000 of Dealer remarketable securities which
were to mature on April 5, 2011 and bore a coupon interest rate of 6.50% (the
"2011 Drs."). The issue price of the 2011 Drs. was 99.753%. On April 5, 2001 the
Consolidated Operating Partnership paid off and retired the 2011 Drs. for a
payment of approximately $105,569. In conjunction with the forecasted retirement
of the 2011 Drs., the Consolidated Operating Partnership entered into an
interest rate protection agreement which fixed the retirement price of the 2011
Drs. On April 2, 2001, this interest rate protection agreement was settled for a
payment of approximately $562. Due to the retirement of the 2011 Drs., the
Consolidated Operating Partnership has recorded an extraordinary loss of
approximately $9,245 comprised of the amount paid above the 2011 Drs. carrying
value, the write-off of unamortized deferred financing fees, the write-off of
the unamortized portion of an interest rate protection agreement which was used
to fix the interest rate on the 2011 Drs. prior to issuance, the settlement of
the interest rate protection agreement as discussed above, legal costs and other
expenses.


                                       11
<PAGE>   13
                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

6.       MORTGAGE LOANS PAYABLE, NET, SENIOR UNSECURED DEBT, NET AND ACQUISITION
         FACILITY PAYABLE, CONTINUED

         The following table discloses certain information regarding the
Consolidated Operating Partnership's mortgage loans payable, senior unsecured
debt and acquisition facility payable:

<Table>
<Caption>
                                      OUTSTANDING BALANCE AT         ACCRUED INTEREST PAYABLE AT     INTEREST RATE AT
                                   -----------------------------    -----------------------------    ----------------
                                    JUNE 30,       DECEMBER 31,       JUNE 30,        DECEMBER 31,      JUNE 30,       MATURITY
                                      2001             2000             2001              2000            2001           DATE
                                   -----------     -------------    -------------    ------------      ------------    ----------
<S>                                <C>             <C>              <C>              <C>                <C>            <C>
MORTGAGE LOANS PAYABLE, NET
CIGNA Loan......................  $   33,590       $   33,952       $     210        $    212             7.500%         4/01/03
Assumed Loans...................       6,781            7,995             ---             ---             9.250%         1/01/13
LB Mortgage Loan  II............         705              705               5               5             8.000%             (1)
Acquisition Mortgage Loan I.....         ---            3,294             ---             ---             8.500%         8/01/08 (6)
Acquisition Mortgage Loan II....         ---            7,432             ---             ---             7.750%         4/01/06 (6)
Acquisition Mortgage Loan III...       3,141            3,214             ---             ---             8.875%         6/01/03
Acquisition Mortgage Loan IV....       2,323            2,364             ---              17             8.950%        10/01/06
Acquisition Mortgage Loan VI....         939 (2)          957 (2)         ---             ---             8.875%        11/01/06
Acquisition Mortgage Loan VII...       1,296 (2)        1,329 (2)         ---             ---             9.750%         3/15/02
                                  ----------       ----------       ---------        ---------
Total...........................     $48,775       $   61,242       $     215        $     234
                                  ==========       ==========       =========        =========

SENIOR UNSECURED DEBT, NET
2005 Notes......................     $50,000         $50,000             $383             $383            6.900%        11/21/05
2006 Notes......................     150,000         150,000              875              875            7.000%        12/01/06
2007 Notes......................     149,969 (3)     149,966 (3)        1,457            1,457            7.600%         5/15/07
2011 PATS.......................      99,540 (3)      99,517 (3)          942              942            7.375%         5/15/11 (4)
2017 Notes......................      99,843 (3)      99,838 (3)          625              625            7.500%        12/01/17
2027 Notes......................      99,874 (3)      99,872 (3)          914              914            7.150%         5/15/27 (5)
2028 Notes......................     199,787 (3)     199,783 (3)        7,009            7,009            7.600%         7/15/28
2011 Drs........................         ---          99,805 (3)          ---            1,553            6.500%         4/05/11 (6)
2011 Notes......................     199,410 (3)         ---            4,179              ---            7.375%         3/15/11
                                  ----------       ----------       ---------        ---------
Total...........................  $1,048,423       $  948,781       $  16,384        $  13,758
                                  ==========       ==========       =========        =========

ACQUISITION FACILITY PAYABLE
2000 Unsecured Acquisition
   Facility.....................  $  141,000       $  170,000       $     797        $   1,359            4.800%         6/30/03
                                  ==========       ==========       =========        =========
</Table>

(1)  The maturity date of the LB Mortgage Loan II is based on a contingent event
     relating to the environmental status of the property collateralizing the
     loan.
(2)  At June 30, 2001, the Acquisition Mortgage Loan VI and the Acquisition
     Mortgage Loan VII are net of unamortized premiums of $45 and $21,
     respectively. At December 31, 2000, the Acquisition Mortgage Loan VI and
     the Acquisition Mortgage Loan VII are net of unamortized premiums of $49
     and $35, respectively.
(3)  At June 30, 2001, the 2007 Notes, 2011 PATS, 2017 Notes, 2027 Notes, 2028
     Notes and the 2011 Notes are net of unamortized discounts of $31, $460,
     $157, $126, $213 and $590, respectively. At December 31, 2000, the 2007
     Notes, 2011 PATS, 2017 Notes, 2027 Notes, 2028 Notes and the 2011 Drs. are
     net of unamortized discounts of $34, $483, $162, $128, $217 and $195,
     respectively.
(4)  The 2011 PATS are redeemable at the option of the holder thereof, on May
     15, 2004.
(5)  The 2027 Notes are redeemable at the option of the holders thereof, on May
     15, 2002.
(6)  The Operating Partnership paid off and retired the 2011 Drs. on April 5,
     2001, the Acquisition Mortgage Loan I on May 31, 2001 and the Acquisition
     Mortgage Loan II on June 27, 2001.

         The following is a schedule of the stated maturities and scheduled
principal payments of the mortgage loans payable, senior unsecured debt and
acquisition facility payable for the next five years ending December 31, and
thereafter:

                                                   Amount
                                                -----------
                    Remainder of 2001           $       764
                    2002                              2,846
                    2003                            177,013
                    2004                                758
                    2005                             50,830
                    Thereafter                    1,006,793
                                                -----------
                    Total                       $ 1,239,004
                                                ===========

         The maturity date of the LB Mortgage Loan II is based on a contingent
event. As a result, this loan is not included in the preceding table.

                                       12
<PAGE>   14
                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

6.       PARTNERS' CAPITAL

         The Operating Partnership has issued general partnership units, limited
partnership units (together, the "Units") and preferred general partnership
units. The general partnership units resulted from capital contributions from
the Company. The limited partnership units are issued in conjunction with the
acquisition of certain properties. Subject to lock-up periods and certain
adjustments, limited partnership units are convertible into common stock, par
value $.01, of the Company on a one - for - one basis or cash at the option of
the Company. The preferred general partnership units resulted from preferred
capital contributions from the Company. The Operating Partnership will be
required to make all required distributions on the preferred general partnership
units prior to any distribution of cash or assets to the holders of the general
and limited partnership units except for distributions required to enable the
Company to maintain its qualification as a REIT.

Unit Contributions:

         During the six months ended June 30, 2001, the Company awarded 94,450
shares of restricted common stock to certain employees and 1,762 shares of
restricted common stock to certain Directors. The Operating Partnership issued
Units to the Company in the same amount. These shares of restricted common stock
had a fair value of approximately $3,074 on the date of grant. The restricted
common stock vests over periods from one to ten years. Compensation expense will
be charged to earnings over the respective vesting period.

         During the six months ended June 30, 2001, the Company issued 1,030,900
non-qualified employee stock options to certain officers, Directors and
employees. These non-qualified employee stock options vest over periods from one
to three years, have a strike price of $31.05 - 33.125 per share and expire ten
years from the date of grant.

         During the six months ended June 30, 2001, certain employees exercised
523,048 non-qualified employee stock options. Gross proceeds to the Company were
approximately $13,936. The Consolidated Operating Partnership, through the
Operating Partnership, issued 523,048 Units to the Company in the same amount.

Distributions:

         On January 22, 2001, the Operating Partnership paid a fourth quarter
2000 distribution of $.6575 per Unit, totaling approximately $30,275. On April
23, 2001, the Operating Partnership paid a first quarter 2001 distribution of
$.6575 per Unit, totaling approximately $30,537.

         On January 2, 2001 and April 2, 2001, the Operating Partnership paid
quarterly distributions of $54.688 per unit on its Series B Cumulative Preferred
Units, $53.906 per unit on its Series C Cumulative Preferred Units, $49.687 per
unit on its Series D Cumulative Preferred Units and $49.375 per unit on its
Series E Cumulative Preferred Units. The preferred unit distributions paid on
January 2, 2001 and April 2, 2001 totaled, in the aggregate, approximately
$7,231 per quarter.


                                       13
<PAGE>   15

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

7.       ACQUISITION AND DEVELOPMENT OF REAL ESTATE

         During the six months ended June 30, 2001, the Consolidated Operating
Partnership acquired 40 industrial properties comprising approximately 1.6
million square feet of GLA and several land parcels. The aggregate purchase
price for these acquisitions totaled approximately $87,076 excluding costs
incurred in conjunction with the acquisition of the properties and the land
parcels. Two of the 40 industrial properties acquired, comprising approximately
 .1 million square feet of GLA, were acquired from the 1998 Joint Venture for an
aggregate purchase price of approximately $5,845, excluding costs incurred in
conjunction with the acquisition of the properties. The Consolidated Operating
Partnership also completed the development of four industrial properties
comprising approximately .8 million square feet of GLA at a cost of
approximately $29.0 million.

8.       SALES OF REAL ESTATE AND REAL ESTATE HELD FOR SALE

         During the six months ended June 30, 2001, the Consolidated Operating
Partnership sold 62 industrial properties comprising approximately 3.9 million
square feet of GLA and several land parcels. Gross proceeds from these sales
were approximately $171,258. The gain on sales of real estate was approximately
$21,612.

         The Consolidated Operating Partnership has an active sales program
through which it is continually engaged in evaluating its current portfolio for
potential sales candidates in order to redeploy capital. At June 30, 2001, the
Consolidated Operating Partnership had 57 industrial properties comprising
approximately 6.1 million square feet of GLA held for sale. There can be no
assurance that such properties held for sale will be sold.

         The following table discloses certain information regarding the 57
industrial properties held for sale by the Consolidated Operating Partnership.

<TABLE>
<CAPTION>
                                               SIX MONTHS ENDED     THREE MONTHS ENDED
                                                    JUNE 30,             JUNE 30,
                                              ------------------    ------------------
                                                2001       2000       2001       2000
                                              -------    -------    -------    -------
<S>                                           <C>        <C>        <C>        <C>
             Total Revenues                   $12,289    $12,737    $ 5,987    $ 6,333
             Operating Expenses                (3,457)    (3,585)    (1,555)    (1,768)
             Depreciation and Amortization       (168)    (2,191)       (84)    (1,115)
                                              -------    -------    -------    -------
             Net Income                       $ 8,664    $ 6,961    $ 4,348    $ 3,450
                                              =======    =======    =======    =======
</TABLE>



                                       14
<PAGE>   16
                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

9.       SUPPLEMENTAL INFORMATION TO STATEMENT OF CASH FLOWS

Supplemental disclosure of cash flow information:

<TABLE>
<CAPTION>
                                                                                            Six Months Ended
                                                                                          ----------------------
                                                                                          June 30,      June 30,
                                                                                           2001          2000
                                                                                          --------      --------
<S>                                                                                       <C>           <C>
   Interest paid, net of capitalized interest .......................................     $ 38,351      $ 39,190
                                                                                          ========      ========
   Interest capitalized .............................................................     $  4,297      $  2,747
                                                                                          ========      ========

Supplemental schedule of noncash investing and financing activities:
   Distribution payable on units ....................................................     $ 30,668      $ 28,601

                                                                                          ========      ========
   Distribution payable on preferred units ..........................................     $  7,231        $  ---
                                                                                          ========      ========

Issuance of Units in exchange for property ..........................................     $  1,491      $    869
                                                                                          ========      ========

Exchange of limited partnership units for general partnership units:
   Limited partnership units ........................................................     $ (4,213)     $ (2,488)
   General partnership units ........................................................        4,213         2,488
                                                                                          --------      --------
                                                                                          $    ---      $    ---
                                                                                          ========      ========

In conjunction with the property and land acquisitions, the following assets and
liabilities were assumed:
   Purchase of real estate ..........................................................     $ 87,076      $ 90,978
   Accrued real estate taxes and security deposits ..................................         (866)         (957)
                                                                                          --------      --------
                                                                                          $ 86,210      $ 90,021
                                                                                          ========      ========

In conjunction with certain property sales, the Operating Partnership provided
seller financing:
   Notes receivable .................................................................     $    ---      $  5,149
                                                                                          ========      ========
</TABLE>


                                       15
<PAGE>   17

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

10.    EARNINGS PER UNIT ("EPU")

      The computation of basic and diluted EPU is presented below:

<Table>
<Caption>
                                                                Six Months Ended                      Three Months Ended
                                                          ---------------------------------    -----------------------------------
                                                          June 30, 2001      June 30, 2000      June 30, 2001       June 30, 2000
                                                          --------------    ---------------    ---------------    ----------------
<S>                                                      <C>               <C>                <C>                <C>
Numerator:

  Net Income Before Extraordinary Loss.................   $      81,736     $      65,609      $       42,359     $         34,503

  Less: Preferred Distributions........................         (14,462)          (14,462)             (7,231)              (7,231)
                                                          --------------    ---------------    ---------------    ----------------

  Net Income Available to Unitholders Before
     Extraordinary Loss - For Basic and Diluted EPU....          67,274            51,147              35,128               27,272

  Extraordinary Loss...................................         (10,309)              ---             (10,309)                 ---
                                                          --------------    ---------------    ---------------    ----------------

  Net Income Available to Unitholders
     - For Basic and Diluted  EPU......................   $       56,965    $      51,147      $       24,819     $         27,272
                                                          ==============    ===============    ===============    ================

Denominator:

  Weighted Average Units - Basic.......................       46,383,713       45,851,130          46,580,767           46,003,824


  Effect of Dilutive Securities:
     Employee and Director Common Stock Options of
     the Company that result in the issuance of
     general partnership units.........................          373,698          194,828             289,465              231,926
                                                          --------------    ---------------    ---------------    ----------------

  Weighted Average Units - Diluted.....................       46,757,411       46,045,958          46,870,232           46,235,750
                                                          ==============    ===============    ===============    ================

Basic EPU:

  Net Income Available to Unitholders Before
     Extraordinary Loss................................   $         1.45    $        1.12      $          .75     $            .59

        Extraordinary Loss.............................             (.22)             ---                (.22)                 ---
                                                          --------------    ---------------    ---------------    ----------------
  Net Income Available to Unitholders..................   $         1.23    $        1.12      $          .53     $            .59
                                                          ==============    ===============    ===============    ================

Diluted EPU:

  Net Income Available to Unitholders Before
     Extraordinary Loss................................   $        1.44     $        1.11      $          .75     $            .59
        Extraordinary Loss.............................            (.22)              ---                (.22)                 ---
                                                          --------------    ---------------    ---------------    ----------------
  Net Income Available to Unitholders..................   $        1.22     $        1.11      $          .53     $            .59
                                                          ==============    ===============    ===============    ================
</Table>

11.    COMMITMENTS AND CONTINGENCIES

      In the normal course of business, the Consolidated Operating Partnership
is involved in legal actions arising from the ownership of its properties. In
management's opinion, the liabilities, if any, that may ultimately result from
such legal actions are not expected to have a materially adverse effect on the
consolidated financial position, operations or liquidity of the Consolidated
Operating Partnership.

         The Consolidated Operating Partnership has committed to the
construction of 28 development projects totaling approximately 5.2 million
square feet of GLA for an estimated investment of approximately $251.7 million.
Of this amount, approximately $149.6 million remains to be funded. These
developments are expected to be funded with cash flow from operations,
borrowings under the Operating Partnership's 2000 Unsecured Acquisition Facility
and proceeds from the sale of select properties. The Consolidated Operating
Partnership expects to place in service approximately 21 of the 28 development
projects, comprising approximately 3.7 million square feet of GLA at an
estimated investment of approximately $177.9 million, during the next twelve
months.



                                       16
<PAGE>   18

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

12.   SUBSEQUENT EVENTS

      From July 1, 2001 to August 3, 2001, the Consolidated Operating
Partnership acquired six industrial properties for an aggregate purchase price
of approximately $16,705, excluding costs incurred in conjunction with the
acquisition of these industrial properties. The Consolidated Operating
Partnership also sold 20 industrial properties and one land parcel for
approximately $42,162 of gross proceeds.

      On July 2, 2001, the Operating Partnership paid a second quarter 2001
distribution of $54.688 per unit on its Series B Cumulative Preferred Units,
$53.906 per unit on its Series C Cumulative Preferred Units, $49.687 per unit on
its Series D Cumulative Preferred Units and $49.375 per unit on its Series E
Cumulative Preferred Units. The preferred unit distributions paid on July 2,
2001 totaled, in the aggregate, approximately $7,231.

      On July 23, 2001, the Operating Partnership paid a second quarter 2001
distribution of $.6575 per Unit, totaling approximately $30,668.




                                       17
<PAGE>   19

                             FIRST INDUSTRIAL, L.P.
      ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS

      The following discussion and analysis of First Industrial, L.P.'s (the
"Operating Partnership") financial condition and results of operations should be
read in conjunction with the financial statements and notes thereto appearing
elsewhere in this Form 10-Q.

      This report contains certain forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The Operating Partnership intends
such forward-looking statements to be covered by the safe harbor provisions for
forward-looking statements contained in the Private Securities Litigation Reform
Act of 1995, and is including this statement for purposes of complying with
these safe harbor provisions. Forward-looking statements, which are based on
certain assumptions and describe future plans, strategies and expectations of
the Operating Partnership, are generally identifiable by use of the words
"believe", "expect", "intend", "anticipate", "estimate", "project" or similar
expressions. The Operating Partnership's ability to predict results or the
actual effect of future plans or strategies is inherently uncertain. Factors
which could have a material adverse affect on the operations and future
prospects of the Operating Partnership on a consolidated basis include, but are
not limited to, changes in: economic conditions generally and the real estate
market specifically, legislative/regulatory changes (including changes to laws
governing the taxation of real estate investment trusts), availability of
capital, interest rates, competition, supply and demand for industrial
properties in the Operating Partnership's current and proposed market areas and
general accounting principles, policies and guidelines applicable to real estate
investment trusts. These risks and uncertainties should be considered in
evaluating forward-looking statements and undue reliance should not be placed on
such statements. Further information concerning the Operating Partnership and
its business, including additional factors that could materially affect the
Operating Partnership's financial results, is included herein and in the
Operating Partnership's other filings with the Securities and Exchange
Commission.

      The Operating Partnership was organized as a limited partnership in the
state of Delaware on November 23, 1993. The sole general partner of the
Operating Partnership is First Industrial Realty Trust, Inc. (the "Company")
with an approximate 84.8% ownership interest at June 30, 2001. The Company also
owns a preferred general partnership interest in the Operating Partnership with
an aggregate liquidation priority of $350 million. The Company is a real estate
investment trust ("REIT") as defined in the Internal Revenue Code. The Company's
operations are conducted primarily through the Operating Partnership. The
limited partners of the Operating Partnership own, in the aggregate,
approximately a 15.2% interest in the Operating Partnership at June 30, 2001.

      The Operating Partnership is the sole member of several limited liability
companies (the "L.L.C.s") and the sole shareholder of First Industrial
Development Services, Inc. (f/k/a FR Development Services, Inc.) and holds at
least a 99% limited partnership interest (subject in one case, as described
below, to a preferred limited partnership interest) in each of eight limited
partnerships (together, the "Other Real Estate Partnerships"). The Operating
Partnership, through separate wholly-owned limited liability companies in which
it is the sole member, also owns 10% equity interests in and provides asset and
property management services to, two joint ventures which invest in industrial
properties (the "September 1998 Joint Venture" and the "September 1999 Joint
Venture"). The financial statements of the Operating Partnership report the
L.L.C.s and First Industrial Development Services, Inc. (hereinafter defined as
the "Consolidated Operating Partnership") on a consolidated basis. The Other
Real Estate Partnerships, the September 1998 Joint Venture and the September
1999 Joint Venture are accounted for under the equity method of accounting.

      The general partners of the Other Real Estate Partnerships are separate
corporations, each with at least a .01% general partnership interest in the
Other Real Estate Partnership for which it acts as a general




                                       18
<PAGE>   20
partner. Each general partner of the Other Real Estate Partnerships is a
wholly-owned subsidiary of the Company.

      Profits, losses and distributions of the Operating Partnership, the
L.L.C.s and the Other Real Estate Partnerships are allocated to the general
partner and the limited partners, or members, as applicable, in accordance with
the provisions contained within the partnership agreements or operating
agreements, as applicable, of the Operating Partnership, the L.L.C.s and the
Other Real Estate Partnerships.

RESULTS OF OPERATIONS

      At June 30, 2001, the Consolidated Operating Partnership owned 838
in-service properties with approximately 53.5 million square feet of gross
leasable area ("GLA"), compared to 875 in-service properties with approximately
56.4 million square feet of GLA at June 30, 2000. During the period between July
1, 2000 and June 30, 2001, the Consolidated Operating Partnership acquired 94
properties containing approximately 4.9 million square feet of GLA, completed
development of 14 properties and the redevelopment of one property totaling
approximately 2.2 million square feet of GLA and sold 134 in-service properties
totaling approximately 9.4 million square feet of GLA, one out of service
property and several land parcels. The Consolidated Operating Partnership also
took 14 properties out of service that are under redevelopment comprising
approximately .8 million square feet of GLA and placed in-service two properties
comprising approximately .2 million square feet of GLA.

COMPARISON OF SIX MONTHS ENDED JUNE 30, 2001 TO SIX MONTHS ENDED JUNE 30, 2000

      Rental income and tenant recoveries and other income increased by
approximately $5.0 million or 3.2% due primarily to an increase in tenant
recoveries related to an increase in property expenses (as discussed below) for
the six months ended June 30, 2001 as compared to the six months ended June 30,
2000. Rental income and tenant recoveries and other income from properties owned
prior to January 1, 2000, increased by approximately $3.8 million or 3.3% due
primarily to general rent increases and an increase in tenant recoveries due to
an increase in property expenses (as discussed below) for the six months ended
June 30, 2001 as compared to the six months ended June 30, 2000.

      Property expenses, which include real estate taxes, repairs and
maintenance, property management, utilities, insurance and other expenses,
increased by approximately $2.0 million or 4.3%. The increase in repairs and
maintenance is due to an increase in snow removal and related expenses. The
increase in utilities is due to increases in gas and electricity expenses. The
increase in insurance is due to an increase in insurance premiums. Property
expenses from properties owned prior to January 1, 2000 increased by
approximately $1.8 million or 5.4% due primarily to the explanations discussed
above.

      General and administrative expense increased by approximately $1.8 million
due primarily to general increases in employee compensation and the write-off of
the Operating Partnership's technology initiative investment.

      Interest expense increased by approximately $1.8 million for the six
months ended June 30, 2001 compared to the six months ended June 30, 2000 due
primarily to a higher average debt balance outstanding, slightly offset by a
decrease in the weighted average interest rate for the six months ended June 30,
2001 (7.18%) compared to the six months ended June 30, 2000 (7.29%) and an
increase in capitalized interest for the six months ended June 30, 2001 due to
an increase in development activities. The average debt balance outstanding for
the six months ended June 30, 2001 and 2000 was approximately $1,269.4 million
and $1,141.2 million, respectively.

      Amortization of deferred financing costs remained relatively unchanged.

      Depreciation and other amortization decreased by approximately $1.1
million due primarily to the Consolidated Operating Partnership ceasing
depreciation and amortization on properties it considers held for sale and due
to properties sold subsequent to December 31, 1999. This decrease is offset by





                                       19
<PAGE>   21
depreciation and amortization related to properties acquired or developed
subsequent to December 31, 2000.

      Equity in income of Other Real Estate Partnerships increased by
approximately $5.9 million due primarily to an increase in gain on sale of real
estate.

      Equity in income of joint ventures increased by approximately $.3 million
due primarily to an increase in gain on sale of real estate.

      The $21.6 million gain on sale of real estate for the six months ended
June 30, 2001 resulted from the sale of 62 industrial properties and several
land parcels. Gross proceeds from these sales were approximately $171.3 million.

      The $12.1 million gain on sale of real estate for the six months ended
June 30, 2000 resulted from the sale of 32 industrial properties and several
land parcels. Gross proceeds from these sales were approximately $112.5 million.

      The $10.3 million extraordinary loss for the six months ended June 30,
2001 is due to the early retirement of senior unsecured debt and various
mortgage loans. The extraordinary loss is comprised of the amount paid above the
carrying amount of the senior unsecured debt, the write-off of unamortized
deferred financing fees, the write-off of the unamortized portion of an interest
rate protection agreement which was used to fix the interest rate on the senior
unsecured debt, the settlement of an interest rate protection agreement used to
fix the retirement price of the senior unsecured debt, prepayment fees, legal
costs and other expenses.

COMPARISON OF THREE MONTHS ENDED JUNE 30, 2001 TO THREE MONTHS ENDED JUNE 30,
2000

      Rental income and tenant recoveries and other income increased by
approximately $1.8 million or 2.3% due primarily to general rent increases and
an increase in tenant recoveries related to an increase in property expenses (as
discussed below) for the three months ended June 30, 2001 as compared to the
three months ended June 30, 2000. Rental income and tenant recoveries and other
income from properties owned prior to January 1, 2000, increased by
approximately $2.0 million or 3.5% due primarily to general rent increases and
an increase in tenant recoveries due to an increase in property expenses (as
discussed below) for the three months ended June 30, 2001 as compared to the
three months ended June 30, 2000.

      Property expenses, which include real estate taxes, repairs and
maintenance, property management, utilities, insurance and other expenses,
increased by approximately $.1 million or .5%. The increase in repairs and
maintenance is due to an increase in snow removal and related expenses. The
increase in utilities is due to general increases in gas and electricity
expenses. The increase in insurance is due to an increase in insurance premiums.
Property expenses from properties owned prior to January 1, 2000 increased by
approximately $.3 million or 1.8% due primarily to the explanations discussed
above.

      General and administrative expense increased by approximately $1.0 million
due primarily to general increases in employee compensation and the write-off of
the Operating Partnership's technology initiative investment.

      Interest expense increased by approximately $.4 million for the three
months ended June 30, 2001 compared to the three months ended June 30, 2000 due
primarily to a higher average debt balance outstanding, slightly offset by a
decrease in the weighted average interest rate for the three months ended June
30, 2001 (7.11%) compared to the three months ended June 30, 2000 (7.30%) and an
increase in capitalized interest for the three months ended June 30, 2001 due to
an increase in development activities. The average debt balance outstanding for
the three months ended June 30, 2001 and 2000 was approximately $1,291.0 million
and $1,154.4 million, respectively.

      Amortization of deferred financing costs remained relatively unchanged.





                                       20
<PAGE>   22
      Depreciation and other amortization decreased by approximately $.6 million
due primarily to the Consolidated Operating Partnership ceasing depreciation and
amortization on properties it considers held for sale and due to properties sold
subsequent to December 31, 1999. This decrease is offset by depreciation and
amortization related to properties acquired or developed subsequent to December
31, 2000.

      Equity in income of Other Real Estate Partnerships increased by
approximately $3.4 million due primarily to an increase in gain on sale of real
estate.

      Equity in income of joint ventures increased by approximately $.2 million
due primarily to an increase in gain on sale of real estate.

      The $9.7 million gain on sale of real estate for the three months ended
June 30, 2001 resulted from the sale of 40 industrial properties and several
land parcels. Gross proceeds from these sales were approximately $116.6 million.

      The $6.3 million gain on sale of real estate for the three months ended
June 30, 2000 resulted from the sale of 21 industrial properties and several
land parcels. Gross proceeds from these sales were approximately $57.8 million.

      The $10.3 million extraordinary loss for the three months ended June 30,
2001 is due to the early retirement of senior unsecured debt and various
mortgage loans. The extraordinary loss is comprised of the amount paid above the
carrying amount of the senior unsecured debt, the write-off of unamortized
deferred financing fees, the write-off of the unamortized portion of an interest
rate protection agreement which was used to fix the interest rate on the senior
unsecured debt, the settlement of an interest rate protection agreement used to
fix the retirement price of the senior unsecured debt, prepayment fees, legal
costs and other expenses.

LIQUIDITY AND CAPITAL RESOURCES

         On June 30, 2001, the Consolidated Operating Partnership's cash and
cash equivalents was approximately $5.1 million and restricted cash totaled
approximately $50.9 million. Restricted cash was comprised of gross proceeds
from the sales of certain properties. These sales proceeds will be disbursed as
the Consolidated Operating Partnership exchanges properties under Section 1031
of the Internal Revenue Code.

SIX MONTHS ENDED JUNE 30, 2001

      Net cash provided by operating activities of approximately $73.8 million
for the six months ended June 30, 2001 was comprised primarily of net income of
approximately $71.4 million and adjustments for non-cash items of approximately
$19.8 million, offset by the net change in operating assets and liabilities of
approximately $17.4 million. The adjustments for the non-cash items of
approximately $19.8 million are primarily comprised of depreciation and
amortization of approximately $32.2 million and an extraordinary loss of
approximately $10.3 million from the early retirement of debt, offset by the
gain on sale of real estate of approximately $21.6 million and the effect of the
straight-lining of rental income of approximately $1.1 million.

      Net cash used in investing activities of approximately $58.4 million for
the six months ended June 30, 2001 was comprised primarily of the acquisition of
real estate, development of real estate, capital expenditures related to the
expansion and improvement of existing real estate, funding of a mortgage loan
receivable, an increase in restricted cash from sales proceeds deposited with an
intermediary for Section 1031 exchange purposes and investments in and advances
to the Other Real Estate Partnerships, offset by the net proceeds from the sale
of real estate, distributions from investment in Other Real Estate




                                       21
<PAGE>   23
Partnerships, distributions from the Operating Partnership's two industrial real
estate joint ventures and the repayment of mortgage loans receivable.

      Net cash used in financing activities of approximately $13.9 million for
the six months ended June 30, 2001 was comprised primarily of Unit (defined
below) and preferred general partnership unit distributions, the repurchase of
restricted units, repayments on mortgage loans payable, repayment of senior
unsecured debt, debt issuance costs incurred in conjunction with the 2011 Notes
(defined below), prepayment fees incurred in the early retirement of the
Acquisition Mortgage Loan I (defined below) and the Acquisition Mortgage Loan II
(defined below) and the net repayments under the Operating Partnership's $300
million unsecured line of credit (the "2000 Unsecured Acquisition Facility"),
offset by Unit contributions and proceeds from the issuance of senior unsecured
debt.

SIX MONTHS ENDED JUNE 30, 2000

      Net cash provided by operating activities of approximately $69.0 million
for the six months ended June 30, 2000 was comprised primarily of net income of
approximately $65.6 million and adjustments for non-cash items of approximately
$19.2 million, offset by the net change in operating assets and liabilities of
approximately $15.8 million. The adjustments for the non-cash items of
approximately $19.2 million are primarily comprised of depreciation and
amortization of approximately $31.8 million, offset by the gain on sale of real
estate of approximately $12.1 million and the effect of the straight-lining of
rental income of approximately $.5 million.

      Net cash used in investing activities of approximately $66.7 million for
the six months ended June 30, 2000 was comprised primarily of the acquisition of
real estate, development of real estate, capital expenditures related to the
expansion and improvement of existing real estate, investments in and advances
to the Other Real Estate Partnerships, contributions to and investments in the
September 1998 Joint Venture and an increase in restricted cash from sales
proceeds deposited with an intermediary for Section 1031 exchange purposes,
offset by distributions from investment in Other Real Estate Partnerships,
distributions from investment in the September 1998 Joint Venture, net proceeds
from the sale of real estate and the repayment of mortgage loans receivable.

      Net cash provided by financing activities of approximately $.2 million for
the six months ended June 30, 2000 was comprised primarily of Unit and preferred
general partnership unit distributions, repayments on mortgage loans payable and
debt issuance costs incurred in conjunction with the 2000 Unsecured Acquisition
Facility, offset by the net borrowings under the Operating Partnership's lines
of credit.

INVESTMENT IN REAL ESTATE, DEVELOPMENT OF REAL ESTATE AND SALES OF REAL ESTATE

      During the six months ended June 30, 2001, the Consolidated Operating
Partnership acquired 40 industrial properties comprising approximately 1.6
million square feet of GLA and several land parcels. The aggregate purchase
price for these acquisitions totaled approximately $87.1 million, excluding
costs incurred in conjunction with the acquisition of the properties and the
land parcels. Two of the 40 industrial properties acquired, comprising
approximately .1 million square feet of GLA, were acquired from the 1998 Joint
Venture for an aggregate purchase price of approximately $5.8 million, excluding
costs incurred in conjunction with the acquisition of the properties. The
Consolidated Operating Partnership also completed the development of four
industrial properties comprising approximately .8 million square feet of GLA at
a cost of approximately $29.0 million.

      During the six months ended June 30, 2001, the Consolidated Operating
Partnership sold 62 industrial properties comprising approximately 3.9 million
square feet of GLA and several land parcels. Gross proceeds from these sales
were approximately $171.3 million.

      The Consolidated Operating Partnership has committed to the construction
of 28 development projects totaling approximately 5.2 million square feet of GLA
for an estimated investment of approximately $251.7 million. Of this amount,
approximately $149.6 million remains to be funded. These



                                       22
<PAGE>   24
developments are expected to be funded with cash flow from operations,
borrowings under the Operating Partnership's 2000 Unsecured Acquisition Facility
and proceeds from the sale of select properties. The Consolidated Operating
Partnership expects to place in service approximately 21 of the 28 development
projects, comprising approximately 3.7 million square feet of GLA at an
estimated investment of approximately $177.9 million, during the next twelve
months.

REAL ESTATE HELD FOR SALE

     The Consolidated Operating Partnership plans on exiting the markets of
Cleveland, Columbus, Dayton, Des Moines, Grand Rapids, Long Island and New
Orleans/Baton Rouge and continually engages in evaluating its other real estate
markets for potential sales candidates. At June 30, 2001, the Consolidated
Operating Partnership had 57 industrial properties comprising approximately 6.1
million square feet of GLA held for sale. Income from operations of the 57
industrial properties held for sale for the six months ended June 30, 2001 and
2000 is approximately $8.7 million and $7.0 million, respectively. Income from
operations of the 57 industrial properties held for sale for the three months
ended June 30, 2001 and 2000 is approximately $4.3 million and $3.5 million,
respectively. Net carrying value of the 57 industrial properties held for sale
at June 30, 2001 is approximately $150.0 million. There can be no assurance that
such properties held for sale will be sold.

INVESTMENTS IN JOINT VENTURES

     During the six months ended June 30, 2001, the Consolidated Operating
Partnership, through wholly-owned limited liability companies in which the
Operating Partnership is the sole member, received, in the aggregate,
approximately $1.2 million in asset management and property management fees from
the September 1998 Joint Venture and the September 1999 Joint Venture,
collectively. The Operating Partnership, through wholly-owned limited liability
companies in which it is the sole member, received, in the aggregate,
distributions of approximately $.6 million from the September 1998 Joint Venture
and the September 1999 Joint Venture. As of June 30, 2001, the September 1998
Joint Venture owned 121 industrial properties comprising approximately 6.3
million square feet of GLA and the September 1999 Joint Venture owned 39
industrial properties comprising approximately 1.2 million square feet of GLA.

MORTGAGE LOANS PAYABLE

     On October 23, 1997, the Consolidated Operating Partnership, through the
Operating Partnership, assumed a mortgage loan in the amount of $4.2 million
(the "Acquisition Mortgage Loan I") in conjunction with the acquisition of a
portfolio of properties. The Acquisition Mortgage Loan I was collateralized by a
property in Bensenville, Illinois, bore interest at a fixed rate of 8.5% and
provided for monthly principal and interest payments based upon a 15-year
amortization schedule. On May 31, 2001, the Consolidated Operating Partnership,
through the Operating Partnership, paid off and retired the Acquisition Mortgage
Loan I. Due to the retirement of the Acquisition Mortgage Loan I, the Operating
Partnership has recorded an extraordinary loss of approximately $.1 million due
to a prepayment fee.

     On December 9, 1997, the Consolidated Operating Partnership, through the
Operating Partnership, assumed a mortgage loan in the amount of $8.0 million
(the "Acquisition Mortgage Loan II") in conjunction with the acquisition of a
portfolio of properties. The Acquisition Mortgage Loan II was collateralized by
ten properties in St. Charles, Louisiana, bore interest at a fixed rate of 7.75%
and provided for monthly principal and interest payments based upon a 22-year
amortization schedule. On June 27, 2001, the Consolidated Operating Partnership,
through the Operating Partnership, paid off and retired the Acquisition Mortgage
Loan II. Due to the retirement of the Acquisition Mortgage Loan II, the
Operating Partnership has recorded an extraordinary loss of approximately $.9
million due to a prepayment fee.



                                       23
<PAGE>   25
SENIOR UNSECURED DEBT

      On March 19, 2001, the Consolidated Operating Partnership, through the
Operating Partnership, issued $200 million of senior unsecured debt which
matures on March 15, 2011 and bears a coupon interest rate of 7.375% (the "2011
Notes"). The issue price of the 2011 Notes was 99.695%. Interest is paid
semi-annually in arrears on September 15 and March 15. The Consolidated
Operating Partnership, through the Operating Partnership, also entered into an
interest rate protection agreement which was used to fix the interest rate on
the 2011 Notes prior to issuance. The Consolidated Operating Partnership,
through the Operating Partnership, settled the interest rate protection
agreement for approximately $.4 million of proceeds which is included in other
comprehensive income. The debt issue discount and the settlement amount of the
interest rate protection agreement are being amortized over the life of the 2011
Notes as an adjustment to interest expense. The 2011 Notes contain certain
covenants including limitations on incurrence of debt and debt service coverage.

     On March 31, 1998, the Consolidated Operating Partnership, through the
Operating Partnership, issued $100 million of Dealer remarketable securities
which were to mature on April 5, 2011 and bore a coupon interest rate of 6.50%
(the "2011 Drs."). The issue price of the 2011 Drs. was 99.753%. On April 5,
2001 the Consolidated Operating Partnership paid off and retired the 2011 Drs.
for a payment of approximately $105.6 million. In conjunction with the
forecasted retirement of the 2011 Drs., the Consolidated Operating Partnership
entered into an interest rate protection agreement which fixed the retirement
price of the 2011 Drs. On April 2, 2001, this interest rate protection agreement
was settled for a payment of approximately $.6 million. Due to the retirement of
the 2011 Drs., the Operating Partnership has recorded an extraordinary loss of
approximately $9.2 million comprised of the amount paid above the 2011 Drs.
carrying value, the write-off of unamortized deferred financing fees, the
write-off of the unamortized portion of an interest rate protection agreement
which was used to fix the interest rate on the 2011 Drs. prior to issuance, the
settlement of the interest rate protection agreement as discussed above, legal
costs and other expenses.

MARKET RISK

      The following discussion about the Consolidated Operating Partnership's
risk-management activities includes "forward-looking statements" that involve
risk and uncertainties. Actual results could differ materially from those
projected in the forward-looking statements.

      This analysis presents the hypothetical gain or loss in earnings, cash
flows or fair value of the financial instruments and derivative instruments
which are held by the Consolidated Operating Partnership at June 30, 2001 that
are sensitive to changes in the interest rates. While this analysis may have
some use as a benchmark, it should not be viewed as a forecast.

      In the normal course of business, the Consolidated Operating Partnership
also faces risks that are either non-financial or non-quantifiable. Such risks
principally include credit risk and legal risk and are not represented in the
following analysis.

      At June 30, 2001, $141.0 million (approximately 11% of total debt at June
30, 2001) of the Consolidated Operating Partnership's debt was variable rate
debt (all of the variable rate debt relates to the Operating Partnership's 2000
Unsecured Acquisition Facility) and $1,097.2 million (approximately 89% of total
debt at June 30, 2001) was fixed rate debt. The Consolidated Operating
Partnership also had outstanding a written put option (the "Written Option")
which was issued in conjunction with the initial offering of one tranche of
senior unsecured debt. Currently, the Consolidated Operating Partnership does
not enter into financial instruments for trading or other speculative purposes.

      For fixed rate debt, changes in interest rates generally affect the fair
value of the debt, but not earnings or cash flows of the Consolidated Operating
Partnership. Conversely, for variable rate debt, changes in the interest rate
generally do not impact the fair value of the debt, but would affect the
Consolidated Operating Partnership's future earnings and cash flows. The
interest rate risk and changes




                                       24
<PAGE>   26
in fair market value of fixed rate debt generally do not have a significant
impact on the Consolidated Operating Partnership until the Consolidated
Operating Partnership is required to refinance such debt. See Note 5 to the
consolidated financial statements for a discussion of the maturity dates of the
Consolidated Operating Partnership's various fixed rate debt.

      Based upon the amount of variable rate debt outstanding at June 30, 2001,
a 10% increase or decrease in the interest rate on the Consolidated Operating
Partnership's variable rate debt would decrease or increase, respectively,
future net income and cash flows by approximately $.7 million per year. A 10%
increase in interest rates would decrease the fair value of the fixed rate debt
at June 30, 2001 by approximately $53.2 million to $1,015.5 million. A 10%
decrease in interest rates would increase the fair value of the fixed rate debt
at June 30, 2001 by approximately $58.8 million to $1,127.5 million. A 10%
increase in interest rates would decrease the fair value of the Written Option
at June 30, 2001 by approximately $1.6 million to $4.0 million. A 10% decrease
in interest rates would increase the fair value of the Written Option at June
30, 2001 by approximately $2.0 million to $7.6 million.

GENERAL PARTNERSHIP, LIMITED PARTNERSHIP, PREFERRED GENERAL PARTNERSHIP UNIT
CONTRIBUTIONS AND EMPLOYEE STOCK OPTIONS

      The Operating Partnership has issued general partnership units, limited
partnership units (together, the "Units") and preferred general partnership
units. The general partnership units resulted from capital contributions from
the Company. The limited partnership units are issued in conjunction with the
acquisition of certain properties. The preferred general partnership units
resulted from preferred capital contributions from the Company. The Operating
Partnership will be required to make all required distributions on the preferred
general partnership units prior to any distribution of cash or assets to the
holders of the general and limited partnership units except for distributions
required to enable the Company to maintain its qualification as a REIT.

Unit Contributions:

      During the six months ended June 30, 2001, the Company awarded 94,450
shares of restricted common stock to certain employees and 1,762 shares of
restricted common stock to certain Directors. The Operating Partnership issued
Units to the Company in the same amount. These shares of restricted common stock
had a fair value of approximately $3.1 million on the date of grant. The
restricted common stock vests over periods from one to ten years. Compensation
expense will be charged to earnings over the respective vesting period.

      During the six months ended June 30, 2001, the Company issued 1,030,900
non-qualified employee stock options to certain officers, Directors and
employees. These non-qualified employee stock options vest over periods from one
to three years, have a strike price of $31.05 - 33.125 per share and expire ten
years from the date of grant.

      During the six months ended June 30, 2001, certain employees exercised
523,048 non-qualified employee stock options. Gross proceeds to the Company were
approximately $13.9 million. The Consolidated Operating Partnership, through the
Operating Partnership, issued 523,048 Units to the Company in the same amount.

DISTRIBUTIONS

      On January 2, 2001 and April 2, 2001, the Operating Partnership paid
quarterly distributions of $54.688 per unit on its Series B Cumulative Preferred
Units, $53.906 per unit on its Series C Cumulative Preferred Units, $49.687 per
unit on its Series D Cumulative Preferred Units and $49.375 per unit on its
Series E Cumulative Preferred Units. The preferred unit distributions paid on
January 2, 2001 and April 2, 2001 totaled, in the aggregate, approximately $7.2
million per quarter.




                                       25
<PAGE>   27
      On January 22, 2001, the Operating Partnership paid a fourth quarter 2000
distribution of $.6575 per Unit, totaling approximately $30.3 million. On April
23, 2001, the Operating Partnership paid a first quarter 2001 distribution of
$.6575 per Unit, totaling approximately $30.5 million.

SUBSEQUENT EVENTS

      From July 1, 2001 to August 3, 2001, the Consolidated Operating
Partnership acquired six industrial properties for an aggregate purchase price
of approximately $16.7 million, excluding costs incurred in conjunction with the
acquisition of these industrial properties. The Consolidated Operating
Partnership also sold 20 industrial properties and one land parcel for
approximately $42.2 million of gross proceeds.

      On July 2, 2001, the Operating Partnership paid a second quarter 2001
distribution of $54.688 per unit on its Series B Cumulative Preferred Units,
$53.906 per unit on its Series C Cumulative Preferred Units, $49.687 per unit on
its Series D Cumulative Preferred Units and $49.375 per unit on its Series E
Cumulative Preferred Units. The preferred unit distributions paid on July 2,
2001 totaled, in the aggregate, approximately $7.2 million.

      On July 23, 2001, the Operating Partnership paid a second quarter 2001
distribution of $.6575 per Unit, totaling approximately $30.7 million.

SHORT-TERM AND LONG-TERM LIQUIDITY NEEDS

      The Consolidated Operating Partnership has considered its short-term (one
year or less) liquidity needs and the adequacy of its estimated cash flow from
operations and other expected liquidity sources to meet these needs. The
Consolidated Operating Partnership believes that its principle short-term
liquidity needs are to fund normal recurring expenses, debt service requirements
and the minimum distribution required by the Company to maintain the Company's
REIT qualification under the Internal Revenue Code. The Consolidated Operating
Partnership anticipates that these needs will be met with cash flows provided by
operating activities.

      The Consolidated Operating Partnership expects to meet long-term (greater
than one year) liquidity requirements such as property acquisitions,
developments, scheduled debt maturities, major renovations, expansions and other
nonrecurring capital improvements through the disposition of select assets,
long-term secured and unsecured indebtedness and the issuance of additional
Units and preferred units. As of June 30, 2001, $100.0 million of debt
securities was registered and unissued under the Securities Act of 1933, as
amended. As of August 3, 2001, $500.0 million of debt securities was registered
and unissued under the Securities Act of 1933, as amended. The Consolidated
Operating Partnership may also finance the development or acquisition of
additional properties through borrowings under the 2000 Unsecured Acquisition
Facility. At June 30, 2001, borrowings under the 2000 Unsecured Acquisition
Facility bore interest at a weighted average interest rate of 4.8%. The 2000
Unsecured Acquisition Facility bears interest at a floating rate of LIBOR plus
 .80%, or the Prime Rate, at the Operating Partnership's election. As of August
3, 2001, the Consolidated Operating Partnership, through the Operating
Partnership, had approximately $148.3 million available in additional borrowings
under the 2000 Unsecured Acquisition Facility.

OTHER

     On January 1, 2001, the Consolidated Operating Partnership adopted the
Financial Accounting Standards Board's Statement of Financial Accounting
Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities" ("FAS 133"), as amended by Statement of Financial Accounting
Standards No. 138, "Accounting for Derivative Instruments and Hedging
Activities- An Amendment of FAS Statement 133". FAS 133, as amended, establishes
accounting and reporting standards for derivative instruments. Specifically, FAS
133, as amended, requires an entity to recognize all derivatives as either
assets or liabilities in the statement of financial position and to measure
those instruments at fair value. Additionally, the fair value adjustment will
affect either other comprehensive income (shareholders'




                                       26
<PAGE>   28
equity) or net income, depending on whether the derivative instrument qualifies
as a hedge for accounting purposes and, if so, the nature of the hedging
activity. FAS 133, as amended, also requires that any gains or losses on
derivative instruments that are reported independently as deferred gains or
losses (assets or liabilities) in the statement of financial position at the
date of initial application shall be derecognized and reported as a cumulative
transition adjustment in other comprehensive income.

     In conjunction with prior issuances of senior unsecured debt, the
Consolidated Operating Partnership, through the Operating Partnership, entered
into interest rate protection agreements to fix the interest rate on anticipated
offerings of unsecured debt. On January 1, 2001, the Consolidated Operating
Partnership, through the Operating Partnership, derecognized the deferred
settlement amounts relating to these settled interest rate protection agreements
and recorded in other comprehensive income a cumulative transition adjustment
expense of approximately $14.9 million.

     In March 2001, the Consolidated Operating Partnership, through the
Operating Partnership, entered into an interest rate protection agreement which
fixed the interest rate on a forecasted offering of unsecured debt which it
designated as a cash flow hedge. In conjunction with the offering of the 2011
Notes, the Consolidated Operating Partnership, through the Operating
Partnership, settled this interest rate protection agreement and received
approximately $.4 million, which is shown in other comprehensive income. The
Consolidated Operating Partnership, through the Operating Partnership, is
amortizing this settlement amount into net income as an adjustment to interest
expense over the life of the 2011 Notes.

     In March 2001, the Consolidated Operating Partnership, through the
Operating Partnership, entered into an interest rate protection agreement which
fixed the retirement price on a forecasted retirement of unsecured debt which it
designated as a cash flow hedge. In conjunction with the retirement of the 2011
Drs. in April 2001, the Consolidated Operating Partnership, through the
Operating Partnership, settled this interest rate protection agreement for a
payment of approximately $.6 million which is a component of the extraordinary
loss the Operating Partnership, has recognized relating to the retirement of the
2011 Drs.



ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Response to this item is included in Item 2. "Management's Discussion and
Analysis of Financial Condition and Results of Operations" above.



                                       27
<PAGE>   29
                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS
   None.

ITEM 2. CHANGES IN SECURITIES

   During the six months ended June 30, 2001, the Operating Partnership issued
   an aggregate of 44,579 Units having an aggregate market value of
   approximately $1.5 million in exchange for property.

   The above Units were issued in a private placement in reliance on Section 4
   (2) of the Securities Act of 1933, as amended, including Regulation D
   promulgated thereunder, to individuals or entities holding real property or
   interests therein. No underwriters were used in connection with such
   issuance.

   Subject to lock-up periods and certain adjustments, Units are generally
   convertible into common stock, par value $.01, of the Company on a
   one-for-one basis.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES
   None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  None.

ITEM 5. OTHER INFORMATION
   Not applicable.

ITEM 6. EXHIBITS AND REPORT ON FORM 8-K

   (a) Exhibits:
         None.


   (b) Reports on Form 8-K:

       Report on Form 8-K filed April 5, 2001, dated April 5, 2001 reporting the
       redemption by the Operating Partnership of its $100 million, 6 1/2%
       Dealer remarketable securities due April 5, 2011.



                                       28
<PAGE>   30

                                    SIGNATURE

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


                               FIRST INDUSTRIAL, L.P.
                               BY: FIRST INDUSTRIAL REALTY TRUST, INC.
                               ITS SOLE GENERAL PARTNER

Date: August 10, 2001          By:  /s/ Michael J. Havala
                                 -----------------------------------------------
                                    Michael J. Havala
                                    Chief Financial Officer
                                    (Principal Financial and Accounting Officer)



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<PAGE>   31

                                  EXHIBIT INDEX


Exhibit No.          Description
-----------          -----------
None.





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