<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 SEPTEMBER 30, 1998
  [ ]  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 NINE MONTHS AND THREE MONTHS ENDED SEPTEMBER 30, 1998

                                      INDEX


<TABLE>
<CAPTION>
                                                                                                PAGE
                                                                                                ----
<S>                                                                                             <C>
PART I:  FINANCIAL INFORMATION

    Item 1.  Financial Statements

        Consolidated Balance Sheets as of September 30, 1998 and December 31, 1997...........     2

        Consolidated Statements of Operations for the Nine Months Ended September 30, 
        1998 and September 30, 1997..........................................................     3

        Consolidated Statements of Operations for the Three Months Ended September 30,
        1998 and September 30, 1997..........................................................     4

        Consolidated Statements of Cash Flows for the Nine Months Ended September 30,
        1998 and September 30, 1997..........................................................     5

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

    Item 2. Management's Discussion and Analysis of Financial Condition and
            Results of Operations............................................................     18-29

PART II:  OTHER INFORMATION

    Item 1.  Legal Proceedings...............................................................     30
    Item 2.  Changes in Securities...........................................................     30
    Item 3.  Defaults Upon Senior Securities.................................................     30
    Item 4.  Submission of Matters to a Vote of Security Holders.............................     30
    Item 5.  Other Information...............................................................     30
    Item 6.  Exhibits and Reports on Form 8-K and 8-K/A......................................     31


SIGNATURE....................................................................................     32


EXHIBIT INDEX................................................................................     33

</TABLE>




                                      1
<PAGE>   3
                          PART I. FINANCIAL INFORMATION
                          ITEM 1. FINANCIAL STATEMENTS
                             FIRST INDUSTRIAL, L.P.
                           CONSOLIDATED BALANCE SHEETS
                             (DOLLARS IN THOUSANDS)
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                                    September 30,     December 31,
                                                                                        1998             1997
                                                                                    ------------      ------------
                                               ASSETS
<S>                                                                                  <C>               <C>        
Assets:
Investment in Real Estate:
   Land .......................................................................      $   330,611       $   184,704
   Buildings and Improvements .................................................        1,831,145         1,012,145
   Furniture, Fixtures and Equipment ..........................................            1,358              --
   Construction in Progress ...................................................            6,054             4,211
   Less: Accumulated Depreciation .............................................         (133,258)          (22,319)
                                                                                     -----------       -----------
              Net Investment in Real Estate ...................................        2,035,910         1,178,741

   Investment in Other Real Estate Partnerships ...............................          342,789           643,621
   Cash and Cash Equivalents ..................................................            2,602             4,995
   Restricted Cash ............................................................            2,138              --
   Tenant Accounts Receivable, Net ............................................            9,254             2,944
   Deferred Rent Receivable ...................................................            9,680             2,584
   Deferred Financing Costs, ..................................................           10,514             6,808
   Prepaid Expenses and Other Assets, Net .....................................           62,751            30,490
                                                                                     -----------       -----------
              Total Assets ....................................................      $ 2,475,638       $ 1,870,183
                                                                                     ===========       ===========

                                  LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
   Mortgage Loans Payable, Net ................................................      $    65,125       $    61,198
   Senior Unsecured Debt, Net .................................................          948,572           648,994
   Acquisition Facility Payable ...............................................          128,800           129,400
   Accounts Payable and Accrued Expenses ......................................           64,409            32,629
   Rents Received in Advance and Security Deposits ............................           17,760             9,775
   Distributions Payable ......................................................           23,735            22,010
                                                                                     -----------       -----------
              Total Liabilities ...............................................        1,248,401           904,006
                                                                                     -----------       -----------

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

Partners' Capital:
   General Partner Preferred Units ...........................................           336,990           144,290
   General Partner Units .....................................................           702,728           674,191
   Limited Partners Units ....................................................           187,519           147,696
                                                                                     -----------       -----------
                Total Partners' Capital .......................................        1,227,237           966,177
                                                                                     -----------       -----------
                Total Liabilities and Partners' Capital .......................      $ 2,475,638       $ 1,870,183
                                                                                     ===========       ===========
        
</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>
                                                                                Nine Months                Nine Months 
                                                                                   Ended                      Ended  
                                                                              September 30, 1998        September 30, 1997
                                                                              ------------------        ------------------
<S>                                                                            <C>                      <C>           
Revenues:
   Rental Income ...........................................................   $ 173,540                      $  51,778     
   Tenant Recoveries and Other Income ......................................      39,956                         12,532     
                                                                               ---------                      ---------     
             Total Revenues ................................................     213,496                         64,310     
                                                                               ---------                      ---------     
Expenses:                                                                                                                   
   Real Estate Taxes .......................................................      35,320                         11,056     
   Repairs and Maintenance .................................................       9,991                          2,563     
   Property Management .....................................................       8,543                          2,503     
   Utilities ...............................................................       5,758                          1,891     
   Insurance ...............................................................         596                            154     
   Other ...................................................................       2,965                            690     
   General and Administrative ..............................................       9,830                          3,918     
   Interest ................................................................      49,401                         16,297     
   Amortization of Interest Rate Protection Agreements and Deferred                                                         
        Financing Costs ....................................................         610                            175     
   Depreciation and Other Amortization .....................................      39,804                         10,132     
                                                                               ---------                      ---------     
              Total Expenses ...............................................     162,818                         49,379     
                                                                               ---------                      ---------     
   Income from Operations Before Equity in Income of Other Real                                                             
        Estate Partnerships and Disposition of Interest Rate Protection                                                     
        Agreements .........................................................      50,678                         14,931     
Equity in Income of Other Real Estate Partnerships .........................      21,489                         19,502     
Disposition of Interest Rate Protection Agreements .........................        --                            4,038     
                                                                               ---------                      ---------     
Income from Operations .....................................................      72,167                         38,471     
Gain on Sales of Real Estate, Net ..........................................         692                            537     
                                                                               ---------                      ---------     
Income Before Extraordinary Loss and Cumulative Effect of                                                                   
   Change in Accounting Principle ..........................................      72,859                         39,008     
Extraordinary Loss .........................................................        --                           (3,428)  
Cumulative Effect of Change in Accounting Principle ........................        (719)                          --       
                                                                               ---------                      ---------     
Net Income .................................................................      72,140                         35,580     
Less:  Preferred Unit Distributions ........................................     (19,458)                        (4,670)    
                                                                               ---------                      ---------     
Net Income Available to Unitholders ........................................   $  52,682                      $  30,910     
                                                                               =========                      =========     
                                                                                                                            
                                                                                                                            
Net Income Available to Unitholders Before Extraordinary Loss and                                                           
   Cumulative Effect of Change in Accounting Principle per                                                                  
   Weighted Average Unit Outstanding:                                                                                       
     Basic .................................................................   $    1.22                      $    1.01     
                                                                               =========                      =========     
     Diluted ...............................................................   $    1.21                      $    1.00     
                                                                               =========                      =========     
                                                                                                                            
                                                                                                                            
Net Income Available to Unitholders per Weighted Average Unit                                                               
 Outstanding:                                                                                                                
     Basic .................................................................   $    1.20                      $     .91     
                                                                               =========                      =========     
     Diluted ...............................................................   $    1.20                      $     .90     
                                                                               =========                      =========     
                                                                                                                            
</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 
                                                                           September 30, 1998    September 30, 1997
                                                                           ------------------    ------------------
<S>                                                                        <C>                   <C>      
Revenues:
   Rental  Income ..........................................................     $ 62,810              $ 19,331      
   Tenant Recoveries and Other Income ......................................       14,348                 4,701     
                                                                                 --------              --------     
             Total Revenues ................................................       77,158                24,032     
                                                                                 --------              --------     
Expenses:                                                                                                           
   Real Estate Taxes .......................................................       12,652                 4,123     
   Repairs and Maintenance .................................................        3,477                   848     
   Property Management .....................................................        3,107                   737     
   Utilities ...............................................................        2,119                   731     
   Insurance ...............................................................          215                    59     
   Other ...................................................................        1,043                   176     
   General and Administrative ..............................................        3,848                 1,276     
                                                                                                                    
   Interest ................................................................       18,807                 7,190     
   Amortization of Interest Rate Protection Agreements .....................                                        
        and Deferred Financing Costs .......................................          241                   167     
   Depreciation and Other Amortization .....................................       14,279                 3,889     
                                                                                 --------              --------     
              Total Expenses ...............................................       59,788                19,196     
                                                                                 --------              --------     

Income from Operations Before Equity in Income of Other Real                                                        
    Estate Partnerships ....................................................       17,370                 4,836     
Equity in Income of Other Real Estate Partnerships .........................        7,443                11,472     
                                                                                 --------              --------     
Income from Operations .....................................................       24,813                16,308     
Gain on Sales of Real Estate, Net ..........................................          599                    77     
                                                                                 --------              --------     
Net Income .................................................................       25,412                16,385     
Less:  Preferred Unit Distributions ........................................       (7,230)               (3,265)    
                                                                                 --------              --------     
Net Income Available to Unitholders ........................................     $ 18,182              $ 13,120     
                                                                                 ========              ========     
                                                                                                                    
                                                                                                                    
Net Income Available to Unitholders per Weighted Average Unit Outstading:                                           
   Basic ...................................................................     $    .41              $    .38     
                                                                                 ========              ========     
   Diluted .................................................................     $    .41              $    .38     
                                                                                 ========              ========     
                                                                                                                    
</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>
                                                                   Nine Months Ended            Nine Months Ended
                                                                   September 30, 1998           September 30, 1997
                                                                   ------------------           ------------------
<S>                                                                 <C>                         <C>           
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income ......................................................   $  72,140                        $  35,580  
                                                                                                                
  Adjustments to Reconcile Net Income to Net Cash                                                            
     Provided by Operating Activities:                                                     
  Depreciation ..................................................      35,889                            9,178  
  Amortization of Interest Rate Protection Agreements and                                                       
     Deferred Financing Costs ...................................         610                              175  
  Other Amortization ............................................       4,437                              840  
  Disposition of Interest Rate Protection Agreements ............        --                             (4,038)
  Gain on Sales of Real Estate, Net .............................        (692)                            (537) 
  Equity in Income of Other Real Estate Partnerships ............     (21,489)                         (19,502) 
  Cumulative Effect of Change in Accounting Principle ...........         719                             --    
  Extraordinary Loss ............................................        --                              3,428  
  Provision for Bad Debts .......................................         649                               79  
  Increase in Tenant Accounts Receivable and                                                                    
     Prepaid Expenses and Other Assets ..........................     (22,804)                         (15,237) 
  Increase in Deferred Rent Receivable ..........................      (2,417)                            (934) 
  Increase in Accounts Payable and Accrued                                                                      
     Rents Received  in Advance and Security Deposits ...........      25,389                           11,970  
  Increase in Organization Costs ................................        --                               (114) 
                                                                    ---------                        ---------  
     Net Cash Provided by Operating Activities...................      92,431                           20,888  
                                                                    ---------                        ---------  
                                                                                                                
CASH FLOWS FROM INVESTING ACTIVITIES:                                                                           
  Purchases and Additions to Investment in Real                                                                 
     Estate and Closing Costs of Sales of Real Estate ............   (467,492)                        (254,724)
  Contributions to Investment in Other Real Estate                                                              
     Partnerships ...............................................     (81,576)                        (364,306) 
  Distributions from Investment in Other Real Estate                                                            
     Partnerships ...............................................      16,250                           44,152  
  Proceeds from Sales of Investment in Real Estate ..............      13,533                           12,464  
  Repayment of Mortgage Loans Receivable ........................       1,063                            3,707  
  Funding of Mortgage Loans Receivable ..........................        --                             (4,594) 
  Increase in Restricted Cash ...................................      (2,138)                            --    
                                                                    ---------                        ---------  
      Net Cash Used in Investing Activities......................    (520,360)                        (563,301) 
                                                                    ---------                        ---------  
                                                                                                                
                                                                                                                
CASH FLOWS FROM FINANCING ACTIVITIES:                                                                           
  Unit Contributions ............................................      35,571                          164,901  
  Unit Distributions ............................................     (68,057)                         (50,404) 
  Preferred Unit Contributions ..................................     192,700                             --    
  Preferred Unit Distributions ..................................     (19,458)                          (4,670) 
  Repayments on Mortgage Loans Payable ..........................      (1,095)                            (605) 
  Repayment of Promissory Notes Payable .........................        --                             (9,919) 
  Book Overdraft ................................................        --                                251  
  Proceeds from Acquisition Facilities Payable ..................     505,000                          280,400  
  Repayments on Acquisition Facilities Payable ..................    (505,600)                        (192,200) 
  Proceeds from Senior Unsecured Debt ...........................     299,517                          349,150  
  Proceeds from Defeasance Loan .................................        --                            309,800
  Repayment of Defeasance Loan ..................................        --                           (309,800)
  Other Proceeds from Senior Unsecured Debt .....................       2,760                            2,246  
  Other Costs of  Senior Unsecured Debt .........................     (11,890)                            --    
  Proceeds from Sale of Interest Rate Protection                                                                
     Agreements .................................................        --                              6,440  
  Debt Issuance Costs and Prepayment Fees .......................      (3,912)                          (7,472) 
                                                                    ---------                        ---------  
     Net Cash Provided by Financing Activities ..................     425,536                          538,118  
                                                                    ---------                        ---------  
  Net Decrease in Cash and Cash Equivalents .....................      (2,393)                          (4,295) 
  Cash and Cash Equivalents, Beginning of Period ................       4,995                            4,295  
                                                                    ---------                        ---------  
  Cash and Cash Equivalents, End of Period ......................   $   2,602                        $    --    
                                                                    =========                        =========  
                                                                                                                
</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, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)

1.     ORGANIZATION AND FORMATION OF COMPANY

       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 of the Operating Partnership is First Industrial Realty Trust,
Inc. (the "Company") with an approximate 84.1% ownership interest at September
30, 1998. The Company also owns preferred units 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 approximately a 15.9% aggregate ownership interest at
September 30, 1998.

       The Operating Partnership is the sole member of 23 limited liability
companies (the "L.L.C.'s"), owns a 95% economic interest in FR Development
Services, Inc. as well as 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 consolidated financial statements of the Operating Partnership report the
L.L.C.'s and FR Development Services, Inc. on a consolidated basis (hereinafter
defined as the "Consolidated Operating Partnership") and the Other Real Estate
Partnerships are accounted for under the equity method of accounting. The
minority ownership interest in FR Development Services, Inc. is not reflected in
the consolidated financial statements due to its immateriality. As of September
30, 1998, the Consolidated Operating Partnership owned 899 in-service properties
containing an aggregate of approximately 58.0 million square feet of gross
leasable area ("GLA"). On a combined basis, as of September 30, 1998, the Other
Real Estate Partnerships owned 101 in-service properties containing an aggregate
of approximately 11.9 million square feet of GLA.

       The general partners of the Other Real Estate Partnerships are separate
corporations, each with a one percent general partnership interest in the Other
Real Estate Partnership 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. First Industrial Securities Corporation, the general partner of one
of the Other Real Estate Partnerships (First Industrial Securities, L.P.), also
owns a preferred limited partnership interest in the First Industrial Securities
L.P. which entitles it to receive a fixed quarterly distribution, and results in
it being allocated income in the same amount, equal to the fixed quarterly
dividend the Company pays on its 9.5% Series A Cumulative Preferred Stock.

       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 operating
agreements, as applicable, of the Operating Partnership, the L.L.C.'s and the
Other Real Estate Partnerships.

2.     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

       The accompanying 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 1997 Form 10-K 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, 1997 audited financial
statements included in the Operating Partnership's 1997 Form 10-K and present
interim disclosures as required by the Securities and Exchange Commission.




                                       6
<PAGE>   8


                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)


2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

      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 and the reported amounts of revenues and expenses. Actual
results could differ from those estimates.

      In the opinion of management, all adjustments consist of normal recurring
adjustments necessary to present fairly the financial position of the
Consolidated Operating Partnership as of September 30, 1998 and the results of
its operations for each of the nine months and three months ended September 30,
1998 and 1997 and its cash flows for the nine months ended September 30, 1998
and 1997.

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 $1,649 and $1,000 as of
September 30, 1998 and December 31, 1997, respectfully.

Recent Accounting Pronouncements:

       In June 1997, the Financial Accounting Standards Board (the "FASB")
issued Statement of Financial Accounting Standards No. 130, "Reporting
Comprehensive Income". This statement, effective for fiscal years beginning
after December 15, 1997, requires the Consolidated Operating Partnership to
report components of comprehensive income in a financial statement that is
displayed with the same prominence as other financial statements. Comprehensive
income is defined by Concepts Statement No. 6, "Elements of Financial
Statements" as the change in the equity of a business enterprise during a period
from transactions and other events and circumstances from non-owner sources. It
includes all changes in equity during a period except those resulting from
investments by owners and distributions to owners. The Consolidated Operating
Partnership's net income available to its unitholders approximates its
comprehensive income as defined in Concepts Statement No. 6, "Elements of
Financial Statements".

      In June 1997, the FASB issued Statement of Financial Accounting Standards
No. 131, "Disclosures about Segments of an Enterprise and Related Information".
This statement, effective for financial statements for fiscal years beginning
after December 15, 1997, requires that a public business enterprise report
financial and descriptive information about its reportable operating segments.
Generally, financial information is required to be reported on the basis that it
is used internally for evaluating segment performance and deciding how to
allocate resources to segments. The Consolidated Operating Partnership will
disclose this information in its 1998 Form 10-K.


                                       7
<PAGE>   9
                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)



2.     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

       In March 1998, the FASB's Emerging Issues Task Force (the "Task Force")
issued Emerging Issues Task Force Issue No. 97-11, "Accounting for Internal
Costs Relating to Real Estate Property Acquisitions" ("EITF 97-11"). EITF 97-11,
effective March 19, 1998, requires that internal costs of preacquisition
activities incurred in connection with the acquisition of an operating property
should be expensed as incurred. The Task Force concluded that a property is
considered operating if, at the date of acquisition, major construction activity
is substantially completed on the property and (a) it is held available for
occupancy upon completion of tenant improvements by the acquirer or (b) it is
already income producing. The Consolidated Operating Partnership adopted EITF
97-11 as of March 19, 1998. Prior to March 19, 1998, the Consolidated Operating
Partnership capitalized internal costs of preacquisition activities incurred in
connection with the acquisition of operating properties. The Consolidated
Operating Partnership estimates that the adoption of EITF 97-11 will result in a
cumulative increase of approximately $2,500 to $3,000 in the amount of general
and administrative expense reflected in the Consolidated Operating Partnership's
consolidated statement of operations in 1998.

       In April 1998, the Accounting Standards Executive Committee of the
American Institute of Certified Public Accountants issued Statement of Position
98-5, "Reporting on the Costs of Start-Up Activities" ("SOP 98-5"). SOP 98-5
requires that the net unamortized balance of all start-up costs and
organizational costs be written off as a cumulative effect of a change in
accounting principle and all future start-up costs and organizational costs be
expensed. In the second quarter of 1998, the Consolidated Operating Partnership
reported a cumulative effect of a change in accounting principle in the amount
of approximately $719 to reflect the write-off of the unamortized balance of
organizational costs on the Consolidated Operating Partnership's balance sheet.

       During the second quarter of 1998, the FASB issued Statement of Financial
Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities". This statement, effective for fiscal years beginning after June 15,
1999, establishes accounting and reporting standards requiring that every
derivative instrument, including certain derivative instruments imbedded in
other contracts, be recorded in the balance sheet as either an asset or
liability measured at its fair value. The statement also requires that the
changes in the derivative's fair value be recognized in earnings unless specific
hedge accounting criteria are met. The Consolidated Operating Partnership is
currently assessing the impact of this new statement on its consolidated
financial position, liquidity, and results of operations.


3.     INVESTMENT IN OTHER REAL ESTATE PARTNERSHIPS

       The Investment in Other Real Estate Partnerships reflects the Operating
Partnership's 99% limited partnership equity interest in the entities described
in Note 1 to these consolidated financial statements.




                                       8
<PAGE>   10



                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)

3.       INVESTMENT IN OTHER REAL ESTATE PARTNERSHIPS, CONTINUED

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

Condensed Combined Balance Sheets:


<TABLE>
<CAPTION>
                                                          September 30,        December 31,
                                                              1998                 1997
                                                          -------------        ------------
                             ASSETS
<S>                                                        <C>                  <C>
Assets:
        Investment in Real Estate, Net .................   $  395,499            $  694,926     
        Other Assets ...................................       39,121               355,726   
                                                           ----------            ----------   
                Total Assets ...........................   $  434,620            $1,050,652   
                                                           ==========            ==========   
               LIABILITIES AND PARTNERS' CAPITAL                                              
Liabilities:                                                                                  
        Mortgage Loans Payable .........................   $   42,551            $   40,000   
        Defeased Mortgage Loan Payable .................         --                 300,000   
        Other Liabilities ..............................        5,919                23,317   
                                                          -----------            ----------   
                 Total Liabilities .....................       48,470               363,317   
                                                          -----------            ----------   
        Partners' Capital ..............................      386,150               687,335   
                                                          -----------            ----------   
                 Total Liabilities and Partners' Capital  $   434,620            $1,050,652   
                                                          ===========            ==========   
</TABLE>


Condensed Combined Statements of Operations:


<TABLE>
<CAPTION>
                                                                         Nine Months Ended
                                                                   -------------------------------
                                                                   September 30,     September 30,
                                                                       1998              1997
                                                                   -------------     -------------
<S>                                                                <C>               <C>           
Total Revenues ..................................................   $ 42,292           $ 90,852      
Property Expenses ...............................................     (9,755)           (22,377)     
Interest Expense ................................................     (2,192)           (18,490)     
Amortization of Interest Rate Protection Agreements and                                              
     Deferred Financing Costs ...................................        (50)            (1,919)     
Depreciation and Other Amortization .............................     (7,167)           (17,333)     
Loss on Disposition of Interest Rate Protection Agreements ......       --               (2,608)     
Gain on Sales of Real Estate ....................................      2,376              3,649      
Extraordinary Loss ..............................................       --               (9,135)     
Cumulative Effect of Change in Accounting Principle .............       (858)              --        
                                                                    --------           --------      
Net Income ......................................................   $ 24,646           $ 22,639      
                                                                    ========           ========      


</TABLE>


     On January 2, 1998, one of the Other Real Estate Partnerships, First
Industrial Financing Partnership, L.P. (the "Financing Partnership") distributed
173 properties with a net book value of $387,647 to the Operating Partnership.



                                        9
<PAGE>   11




                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)

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

Mortgage Loans, Net:

     On April 16, 1998, the Operating Partnership assumed a mortgage loan in the
principal amount of $2,525 (the "Acquisition Mortgage Loan IV"). The Acquisition
Mortgage Loan IV is collateralized by one property in Baltimore, Maryland, bears
interest at a fixed rate of 8.95% and provides for monthly principal and
interest payments based on a 20-year amortization schedule. The Acquisition
Mortgage Loan IV matures on October 1, 2006. The Acquisition Mortgage Loan IV
may be prepaid only after October 2001 in exchange for the greater of a 1%
prepayment fee or a yield maintenance premium.

       On August 31, 1998, the Operating Partnership assumed a mortgage loan in
the principal amount of $965 (the "Acquisition Mortgage Loan VI"). The
Acquisition Mortgage Loan VI is collateralized by one property in Portland,
Oregon, bears interest at a fixed rate of 8.875% and provides for monthly
principal and interest payments based on a 20-year amortization schedule. The
Acquisition Mortgage Loan VI matures on November 1, 2006. The Acquisition
Mortgage Loan VI may be prepaid only after September 2001 in exchange for a 3%
prepayment fee.

       On August 31, 1998, the Operating Partnership assumed a mortgage loan in
the principal amount of $1,367 (the "Acquisition Mortgage Loan VII"). The
Acquisition Mortgage Loan VII is collateralized by one property in Milwaukie,
Oregon, bears interest at a fixed rate of 9.75% and provides for monthly
principal and interest payments based on a 25-year amortization schedule. The
Acquisition Mortgage Loan VII matures on March 15, 2002. The Acquisition
Mortgage Loan VII may be prepaid only after December 2001.

Senior Unsecured Debt, Net:

       On March 31, 1998, the Operating Partnership issued $100,000 of Dealer
remarketable securities which mature on April 5, 2011 and bear a coupon interest
rate of 6.50% (the "2011 Drs."). The issue price of the 2011 Drs. was 99.753%.
Interest is paid semi-annually in arrears on April 5 and October 5. The 2011
Drs. are callable (the "Call Option"), at the option of J.P. Morgan Securities,
Inc., as Remarketing Dealer (the "Remarketing Dealer"), on April 5, 2001 (the
"Remarketing Date"). The Operating Partnership received approximately $2,760 of
proceeds from the Remarketing Dealer as consideration for the Call Option. The
Operating Partnership will amortize the proceeds over the life of the Call
Option as an adjustment to interest expense. If the holder of the Call Option
calls the 2011 Drs. and elects to remarket the 2011 Drs., then after the
Remarketing Date, the interest rate on the 2011 Drs. will be reset at a fixed
rate until April 5, 2011 based upon a predetermined formula as disclosed in the
related Prospectus Supplement. If the Remarketing Dealer elects not to remarket
the 2011 Drs., then the Operating Partnership will be required to repurchase, on
the Remarketing Date, any 2011 Drs. that have not been purchased by the
Remarketing Dealer at 100% of the principal amount thereof, plus accrued and
unpaid interest, if any. The Operating Partnership also settled an interest rate
protection agreement, in the notional amount of $100,000, which was used to fix
the interest rate on the 2011 Drs. prior to issuance. The debt issue discount
and the settlement amount of the interest rate protection agreement are being
amortized over the life of the 2011 Drs. as an adjustment to interest expense.
The 2011 Drs. 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, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)

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

       On July 14, 1998, the Operating Partnership issued $200,000 of senior
unsecured debt which matures on July 15, 2028 and bears a coupon interest rate
of 7.60% (the "2028 Notes"). The issue price of the 2028 Notes was 99.882%.
Interest is paid semi-annually in arrears on January 15 and July 15. The
Operating Partnership also settled interest rate protection agreements, in the
notional amount of $150,000, which were used to fix the interest rate on the
2028 Notes prior to issuance. The debt issue discount and the settlement amount
of the interest rate protection agreements are being amortized over the life of
the 2028 Notes as an adjustment to the interest expense. The 2028 Notes contain
certain covenants including limitation on incurrence of debt and debt service
coverage. Approximately $50,000 of the 2028 Notes was purchased, through a 
broker/dealer, by an entity in which a Director of the Company owns greater
than a ten percent interest.

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


<TABLE>
<CAPTION>
                                                                                ACCRUED INTEREST           INTEREST 
                                              OUTSTANDING BALANCE AT              PAYABLE AT                 RATE AT  
                                            ----------------------------   ---------------------------    ------------
                                            SEPTEMBER 30,   DECEMBER 31,   SEPTEMBER 30,  DECEMBER 31,    SEPTEMBER 30,  MATURITY
                                                1998           1997            1998           1997            1998         DATET
                                            ------------    ------------   -------------  ------------    ------------  ----------
<S>                                          <C>            <C>            <C>              <C>          <C>            <C>  
MORTGAGE LOANS PAYABLE
CIGNA Loan ..............................    $ 35,372       $ 35,813          $   --           $   --       7.500%       4/01/03   
Assumed Loans ...........................       8,736          8,950              --               --       9.250%       1/01/13   
LB Mortgage Loan II .....................         705            705              --               --       8.000%            (1)  
Acquisition Mortgage Loan I .............       3,929          4,135              --                 29     8.500%       8/01/08   
Acquisition Mortgage Loan II ............       7,871          7,997                51               52     7.750%       4/01/06   
Acquisition Mortgage Loan III ...........       3,514          3,598                26               27     8.875%       6/01/03   
Acquisition Mortgage Loan IV ............       2,502           --                  19             --       8.950%       10/01/06  
Acquisition Mortgage Loan VI ............       1,031(2)        --                   7             --       8.875%       11/01/06  
Acquisition Mortgage Loan VII ...........       1,465(2)        --                  11             --       9.750%       3/15/02   
                                             --------       --------          --------         --------                            
Total ...................................    $ 65,125       $ 61,198          $    114         $    108                            
                                             ========       ========          ========         ========                            
                                                                                                                                   
SENIOR UNSECURED DEBT                                                                                                              
2005 Notes ..............................    $ 50,000       $ 50,000          $  1,246         $    393     6.900%       11/21/05  
2006 Notes ..............................     150,000        150,000             3,500              671     7.000%       12/01/06  
2007 Notes ..............................     149,954(3)     149,951             4,307            1,457     7.600%       5/15/07   
2011 Notes ..............................      99,412(3)      99,377             2,786              942     7.375%       5/15/11(4)
2017 Notes ..............................      99,816(3)      99,809             2,500              479     7.500%       12/01/17  
2027 Notes ..............................      99,861(3)      99,857             2,701              914     7.150%       5/15/27(5) 
2028 Notes ..............................     199,766(3)        --               3,251             --       7.600%       7/15/28   
2011 Drs ................................      99,763(3)        --               3,250             --       6.500%(7)    4/05/11(6)
                                             --------       --------          --------         --------                            
Total ...................................    $948,572       $648,994          $ 23,541         $  4,856                            
                                             ========       ========          ========         ========                            
                                                                                                                                   
ACQUISITION FACILITY PAYABLE                                                                                                       
1997 Unsecured Acquisition                                                                                                         
                                                                                                                                   
Facility ................................    $128,800       $129,400          $    579         $    297     6.493%        4/01/01   
                                             ========       ========          ========         ========                            
                                                                                                                                   
</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)  The Acquisition mortgage Loan VI and the Acquisition Mortgage Loan VII are
     net of unamortized premiums of $68 and $100, respectively.
(3)  The 2007 Notes, 2011 Notes, 2017 Notes, 2027 Notes, 2028 Notes and the 2011
     Drs. are net of unamortized discounts of $46, $588, $184, $139, $234 and
     $237, respectively.
(4)  The 2011 Notes 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 2011 Drs. are required to be redeemed by the Operating Partnership on
     April 5, 2001 if the Remarketing Dealer elects not to remarket the 2011
     Drs.
(7)  The 2011 Drs. bear interest at an annual rate of 6.50% to the Remarketing
     Date. If the holder of the Call Option calls the 2011 Drs. and elects to
     remarket the 2011 Drs., then after the Remarketing Date, the interest rate
     on the 2011 Drs. will be reset at a fixed rate until April 5, 2011 based on
     a predetermined formula as disclosed in the related Prospectus Supplement.



                                       11
<PAGE>   13





                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)

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

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

<TABLE>
<CAPTION>
                            Amount
                           ----------
<S>                        <C>      
         1998              $     391
         1999                  1,647
         2000                  1,788
         2001                130,741
         2002                  3,329
         Thereafter        1,005,156
                          ----------
         Total            $1,143,052
                          ==========
</TABLE>


       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.

       The Operating Partnership, from time to time, enters into interest rate
protection agreements which are used to lock into a fixed interest rate on
anticipated offerings of senior unsecured debt. At September 30, 1998, the
following interest rate protection agreement was outstanding:


<TABLE>
<CAPTION>
         Notional            Origination                                                      Settlement
          Amount                 Date            Interest Rate      Valuation Basis              Date
     -----------------    -------------------    ---------------    -----------------    --------------------
<S>                       <C>                    <C>                <C>                  <C>
     $100,000             December 19, 1997          5.994%         30-Year Treasury        January 4, 1999
</TABLE>


5.    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 (see discussion below). 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 nine months ended September 30, 1998, the Operating
Partnership issued 1,440,629 Units valued, in the aggregate, at $47,507 in
exchange for interests in certain properties. These contributions are reflected
in the Operating Partnership's financial statements as limited partners
contributions.

       On April 23, 1998, the Company issued, in a private placement, 1,112,644
shares of $.01 par value Common Stock (the "April 1998 Equity Offering"). The
net proceeds of approximately $34,100 received from the April 1998 Equity
Offering were contributed to the Operating Partnership in exchange for 1,112,644
Units in the Operating Partnership and are reflected in the Operating
Partnership's financial statements as a general partner contribution. 



                                       12
<PAGE>   14


                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)

5.     PARTNERS' CAPITAL, CONTINUED

       During the nine months ended September 30, 1998, certain employees of the
Company exercised 103,500 employee stock options. Gross proceeds to the Company
approximated $2,430. The gross proceeds from the option exercises were
contributed to the Operating Partnership in exchange for Units and are reflected
in the Consolidated Operating Partnership's financial statements as a general
partner contribution.

       During the nine months ended September 30, 1998, the Company awarded
51,850 shares of restricted Common Stock to certain employees and 1,887 shares
of restricted Common Stock to certain Directors. Other employees of the Company
converted certain employee stock options to 13,602 shares of restricted Common
Stock. The Operating Partnership issued Units to the Company in the same amount.
These shares of restricted Common Stock had a fair value of $2,324 on the date
of grant. The restricted Common Stock vests over a period from five to ten
years. Compensation expense will be charged to earnings over the respective
vesting period.

Preferred Unit Contributions:

       On February 4, 1998, the Company issued 5,000,000 Depositary Shares, each
representing 1/100th of a share of the Company's 7.95%, $.01 par value, Series D
Cumulative Preferred Stock (the "Series D Preferred Stock"), at an initial
offering price of $25 per Depositary Share. The net proceeds of $120,562
received from the Series D Preferred Stock were contributed to the Operating
Partnership in exchange for 7.95% Series D Cumulative Preferred Units (the
"Series D Preferred Units") and are reflected in the Consolidated Operating
Partnership's financial statements as a general partner preferred unit
contribution.

       On March 18, 1998, the Company issued 3,000,000 Depositary Shares, each
representing 1/100th of a share of the Company's 7.90%, $.01 par value, Series E
Cumulative Preferred Stock (the "Series E Preferred Stock"), at an initial
offering price of $25 per Depositary Share. The net proceeds of $72,138 received
from the Series E Preferred Stock were contributed to the Operating Partnership
in exchange for 7.90% Series E Cumulative Preferred Units (the "Series E
Preferred Units") and are reflected in the Consolidated Operating Partnership's
financial statements as a general partner preferred unit contribution.

Non-Qualified Employee Stock Options:

       On January 2, 1998, the Company granted 4,370,000 non-qualified employee
stock options. These stock options vest over three years based upon certain
performance measures. The stock options have a strike price of $35.8125 per
share and expire ten years from the date of grant. The exercise of these stock
options will result in the issuance of Units to the Company in the same amount.

       On May 14, 1998, the Company granted 899,000 non-qualified employee stock
options. These stock options vest over one year and have a strike price of
$31.13 per share. The stock options expire between seven and ten years from the
date of grant. The exercise of these stock options will result in the issuance
of Units to the Company in the same amount.



                                       13
<PAGE>   15
                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                  (UNAUDITED )


6.     ACQUISITION OF REAL ESTATE

       During the nine months ended September 30, 1998, the Consolidated
Operating Partnership acquired 207 existing industrial properties and several
land parcels. The aggregate purchase price for these acquisitions totaled
approximately $471,434, excluding costs incurred in conjunction with the
acquisition of the properties.

       Of the 207 existing industrial properties and several land parcels
purchased by the Consolidated Operating Partnership during the nine months ended
September 30, 1998, four existing industrial properties were purchased from
Western Suburban Industrial Investments Limited Partnership ("Western") in which
the sole general partner, having a 5% interest, was Tomasz/Shidler Investment
Corporation, of which the sole shareholders were a Director and Director/Officer
of the general partner of the Operating Partnership who also had a
53% and 32% limited partnership interest in Western, respectively. Further, an
additional Director/Officer of the general partner of the Operating
Partnership was a limited partner in Western having an interest of 2%. The
aggregate purchase price for this acquisition totaled approximately $7,900,
excluding costs incurred in conjunction with the acquisition of the properties.

       During the second quarter of 1998, the Operating Partnership
completed an acquisition of a real estate firm for which an officer and an
employee of the Operating Partnership owned a 77.5% interest. Gross
proceeds to the real estate firm totaled approximately $2,349.

7.     SALES OF REAL ESTATE

       During the nine months ended September 30, 1998, the Consolidated
Operating Partnership sold seven existing industrial properties and one land
parcel. Gross proceeds from these sales were approximately $13,533. The gain on
sales of real estate was approximately $692, net of federal income taxes.

8.     SUPPLEMENTAL INFORMATION TO STATEMENT OF CASH FLOWS

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
 


<TABLE>
<CAPTION>
                                                                                         Nine Months Ended
                                                                                   -------------------------------
                                                                                   September 30,    September 30,
                                                                                        1998             1997
                                                                                   -------------    -------------
<S>                                                                                <C>              <C>
   Interest paid, net of capitalized interest ...................................   $  30,428           $   6,159
                                                                                    =========           =========
   Interest capitalized .........................................................   $   2,628           $     220
                                                                                    =========           =========

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:
   Distributions payable on  Units ..............................................   $  23,735           $  17,706
                                                                                    =========           =========

IN CONJUNCTION WITH THE PROPERTY ACQUISITIONS, THE FOLLOWING ASSETS AND
LIABILITIES WERE ASSUMED AND OPERATING PARTNERSHIP UNITS WERE EXCHANGED:
   Purchase of real estate ......................................................   $ 471,434           $ 300,845
   Accrued real estate taxes and security deposits ..............................      (4,210)             (3,158)
   Mortgage loans, net ..........................................................      (5,029)             (4,505)
   Operating Partnership Units ..................................................     (47,507)            (58,518)
                                                                                    ---------           ---------
                                                                                    $ 414,688           $ 234,664
                                                                                    =========           =========

</TABLE>



IN CONJUNCTION WITH THE DISTRIBUTION OF 173 PROPERTIES FROM THE FINANCING
PARTNERSHIP TO THE OPERATING PARTNERSHIP ON JANUARY 2, 1998, THE FOLLOWING
ASSETS AND LIABILITIES WERE ASSUMED:


<TABLE>
<S>                                                                            <C>      
Investment in real estate, net ........................................        $ 382,190
Tenant accounts receivable ............................................            3,017
Deferred rent receivable ..............................................            4,689
Other assets ..........................................................            6,209
Accounts payable and accrued expenses .................................           (5,920)
Rents received in advance and security deposits .......................           (2,538)
                                                                               ---------
Investment in other real estate partnerships ..........................        $ 387,647
                                                                               =========

</TABLE>



                                       14
<PAGE>   16

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)


9. EARNINGS PER UNIT

      Net income per weighted average Units - Basic, is based on the weighted
average Units outstanding. Net Income per weighted average Unit - Diluted, is
based on the weighted average Units outstanding plus the effect of in-the-money
employee stock options that result in the issuance of general partnership units.
The computation of basic and diluted EPU is presented below:




<TABLE>
<CAPTION> 
                                                                         Nine Months    Nine Months   Three Months    Three Months
                                                                           Ended          Ended          Ended           Ended
                                                                        September 30,   September 30,  September 30,  September 30,
                                                                            1998             1997            1998        1997
                                                                        -------------   -------------  -------------  -------------
<S>                                                                      <C>              <C>             <C>             <C>     
Numerator:
  Income Before Extraordinary Loss and Cumulative
    Effect of Change in Accounting Principle .......................       $ 72,859        $ 39,008        $ 25,412        $ 16,385
  Less: Preferred Distributions ....................................        (19,458)         (4,670)         (7,230)         (3,265)
                                                                           --------        --------        --------        --------
  Net Income Available to Unitholders Before
   Extraordinary Loss and Cumulative Effect of
   Change in Accounting Principle - For Basic and
   Diluted  EPU ....................................................         53,401          34,338          18,182          13,120

  Extraordinary Loss ...............................................           --            (3,428)           --              --   

  Cumulative Effect of Change in Accounting Principle ..............           (719)           --              --              --
                                                                           --------        --------        --------        --------

  Net Income Available to Unitholders  For Basic
   and Diluted EPU .................................................       $ 52,682        $ 30,910        $ 18,182        $ 13,120
                                                                           ========        ========        ========        ========

Denominator:
  Weighted Average Units Basic .....................................         43,750          34,005          44,765          34,442
  Effect of Dilutive Securities:
     Employee Common Stock Options of the Company
     that result in the issuance of general
     partnership units .............................................            235             286             116             298
                                                                           --------        --------        --------        --------

  Weighted Average Units - Diluted .................................         43,985          34,291          44,881          34,740
                                                                           ========        ========        ========        ========

Basic EPU:
  Net Income Available to Unitholders Before
    Extraordinary Loss and Cumulative Effect of
    Change in Accounting Principle .................................       $   1.22        $   1.01        $    .41        $    .38
                                                                           ========        ========        ========        ========

  Extraordinary Loss ...............................................       $   --          $   (.10)       $   --          $   --   
                                                                           ========        ========        ========        ========

  Cumulative Effect of Change in Accounting Principle ..............       $   (.02)       $   --          $   --          $   --   
                                                                           ========        ========        ========        ========

  Net Income Available to Unitholders ..............................       $   1.20        $    .91        $    .41        $    .38
                                                                           ========        ========        ========        ========

Diluted EPU:
  Net Income Available to Unitholders Before
     Extraordinary Loss and Cumulative Effect of
     Change in Accounting Principle ................................       $   1.21        $   1.00        $    .41        $    .38
                                                                           ========        ========        ========        ========

  Extraordinary Loss ...............................................       $   --          $   (.10)       $   --          $   --
                                                                           ========        ========        ========        ========

  Cumulative Effect of Change in Accounting Principle ..............       $   (.02)       $   --          $   --          $   --
                                                                           ========        ========        ========        ========

  Net Income Available to Unitholders ..............................       $   1.20        $    .90        $    .41        $    .38
                                                                           ========        ========        ========        ========


</TABLE>


                                       15
<PAGE>   17


                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)


10.  COMMITMENTS AND CONTINGENCIES

     In the normal course of business, the 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 Operating Partnership.

     The Operating Partnership has committed to the construction of five
development projects totaling approximately .5 million square feet of GLA. The
estimated total construction costs are approximately $21,309. These developments
are expected to be funded with cash flow from operations as well as borrowings
under the Operating Partnership's $300,000 unsecured revolving credit facility
(the "1997 Unsecured Acquisition Facility").

11.  SUBSEQUENT EVENTS

     From October 1, 1998 to November 6, 1998, the Operating Partnership
acquired 15 industrial properties. The aggregate purchase price for these
acquisitions totaled approximately $14,847, excluding costs incurred in
conjunction with the acquisition of the properties.

     On September 28, 1998, the Operating Partnership entered into a joint
venture arrangement (the "September 1998 Joint Venture") with an institutional
investor to invest in industrial properties. The Operating Partnership, through
wholly owned limited liability companies, will own a 10% equity interest in the
September 1998 Joint Venture and will provide property and asset management
services to the September 1998 Joint Venture. On October 9, 1998, October 23,
1998 and November 6, 1998, the September 1998 Joint Venture acquired
approximately $100,000, $37,000 and $62,000, respectively, of industrial
properties and expects to acquire approximately an additional $101,000 of
industrial properties. The acquisition of additional industrial properties is
subject to, among other contingencies, due diligence and the negotiation of
definitive documentation. There can be no assurance that such acquisitions will
be completed. The Operating Partnership will account for the September 1998
Joint Venture under the equity method of accounting. The Operating Partnership's
investment in the September 1998 Joint Venture relating to these transactions
approximates $4,000.

     On October 19, 1998, the Operating Partnership paid a third quarter 1998
distribution of $.53 per Unit, totaling approximately $23,735.

     On November 5, 1998, the Operating Partnership, settled its remaining
interest rate protection agreement which was scheduled to expire on January 4,
1999. This agreement was entered into in December 1997 in anticipation of 1998
senior unsecured debt offerings. Due to the changing market conditions and the 
Operating Partnership's expectation that it will not issue debt securities 
associated with the interest rate protection agreement, it is the Operating
Partnership's belief that the interest rate protection agreement no longer
qualifies for hedge accounting treatment under generally accepted accounting
principles. As a result, the Operating Partnership will recognize an expense of
approximately $8,500 associated with the termination of this interest rate
protection agreement in the fourth quarter of 1998.

12.  RELATED PARTY TRANSACTIONS

     From time to time, the Operating Partnership utilizes leasing services
from an entity for which one of the Company's Officers owns a 62.5% ownership
interest. From January 1, 1998 through September 30, 1998, the Operating
Partnership has paid approximately $200 of leasing commissions to this entity.



                                       16
<PAGE>   18

                             FIRST INDUSTRIAL, L.P.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT DATA)
                                   (UNAUDITED)


13.    PRO FORMA FINANCIAL INFORMATION

       The pro forma financial information will be filed in an amendment to the
Operating Partnership's Form 8-K dated November 6, 1998 as filed November
12, 1998.






                                       17
<PAGE>   19

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




       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 of the Operating Partnership is First Industrial Realty Trust,
Inc. (the "Company") with an approximate 84.1% ownership interest at September
30, 1998. The Company also owns preferred units 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 approximately a 15.9% aggregate ownership interest at
September 30, 1998.

       The Operating Partnership is the sole member of 23 limited liability
companies (the "L.L.C.'s"), owns a 95% economic interest in FR Development
Services, Inc. as well as 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 financial statements of the Operating Partnership report the L.L.C.'s and FR
Development Services, Inc. on a consolidated basis (hereinafter defined as the
"Consolidated Operating Partnership") and the Other Real Estate Partnerships are
accounted for under the equity method of accounting. The minority ownership
interest in FR Development Services, Inc. is not reflected in the consolidated
financial statements due to its immateriality.

       The general partners of the Other Real Estate Partnerships are separate
corporations, each with a one percent general partnership interest in the Other
Real Estate Partnership 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. First Industrial Securities Corporation, the general partner of the
of one of the Other Real Estate Partnerships (First Industrial Securities,
L.P.), also owns a preferred limited partnership interest in the First
Industrial Securities L.P. which entitles it to receive a fixed quarterly
distribution, and results in it being allocated income in the same amount, equal
to the fixed quarterly dividend the Company pays on its 9.5% Series A Cumulative
Preferred Stock.

       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.

       The following discussion and analysis of the Consolidated Operating
Partnership's 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.

RESULTS OF OPERATIONS

       At September 30, 1998, the Consolidated Operating Partnership owned 899
in-service properties with approximately 58.0 million square feet of gross
leasable area ("GLA"), compared to 245 in-service properties with approximately
20.0 million square feet of GLA at September 30, 1997. The addition of 662
properties acquired or developed between October 1, 1997 and September 30, 1998
included the acquisitions of 478 properties totaling approximately 23.2 million
square feet of GLA, the completed development of 11 properties totaling
approximately 1.7 million square feet of GLA and the distribution of 173
properties from First Industrial Financing Partnership, L.P. (the "Financing
Partnership") totaling approximately 13.4 million square feet of GLA. The
Consolidated Operating Partnership also sold eight in-service properties
totaling approximately .3 million square feet of GLA, one property held for
redevelopment and several land parcels.




                                       18
<PAGE>   20

COMPARISON OF NINE MONTHS ENDED SEPTEMBER 30, 1998 TO NINE MONTHS ENDED 
SEPTEMBER 30, 1997

       Rental income and tenant recoveries and other income increased by $149.2
million or 232.0% due primarily to the properties acquired or developed after
December 31, 1996 and the distribution of 173 properties from the Financing
Partnership to the Operating Partnership on January 2, 1998 (between January 1,
1997 and September 30, 1998, the Consolidated Operating Partnership acquired
approximately $1.3 billion of industrial properties, of which, approximately
$1.0 billion was acquired subsequent to September 30, 1997). Revenues from
properties owned prior to January 1, 1997, increased by approximately $.9
million or 1.0% due primarily to general rent increases.

       Property expenses, which include real estate taxes, repairs and
maintenance, property management, utilities, insurance and other expenses,
increased by approximately $44.3 million or 235.0% due primarily to the
properties acquired or developed after December 31, 1996 and the distribution of
173 properties from the Financing Partnership to the Operating Partnership on
January 2, 1998 (between January 1, 1997 and September 30, 1998, the
Consolidated Operating Partnership acquired approximately $1.3 billion of
industrial properties, of which, approximately $1.0 billion was acquired
subsequent to September 30, 1997). Expenses from properties owned prior to
January 1, 1997, decreased by approximately $.1 million or .3% due primarily to
a decrease in snow removal and related expenses incurred for properties located
in certain of the Consolidated Operating Partnership's metropolitan areas during
the nine months ended September 30, 1998 as compared to the nine months ended
September 30, 1997.

       General and administrative expense increased by approximately $5.9
million, of which, approximately $4.0 million is due primarily to the additional
expenses associated with managing the Consolidated Operating Partnership's
growing operations including additional professional fees relating to additional
properties owned and additional personnel to manage and expand the Consolidated
Operating Partnership's business. Approximately $1.9 million of the increase is
the result of the adoption of Emerging Issues Task Force Issue No. 97-11,
"Accounting for Internal Costs Relating to Real Estate Property Acquisitions"
("EITF 97-11"), which requires that internal costs of preacquisition activities
incurred in connection with the acquisition of an operating property should be
expensed as incurred. The Consolidated Operating Partnership adopted EITF 97-11
on March 19, 1998.

       Interest expense increased by approximately $33.1 million for the nine
months ended September 30, 1998 compared to the nine months ended September 30,
1997 due primarily to a higher average debt balance outstanding resulting from
the issuance of senior unsecured debt to fund the acquisition and development of
additional properties (between January 1, 1997 and September 30, 1998, the
Consolidated Operating Partnership acquired approximately $1.3 billion of
industrial properties, of which, approximately $1.0 billion was acquired
subsequent to September 30, 1997).

       Amortization of interest rate protection agreements and deferred
financing costs increased by approximately $.4 million due primarily to
additional amortization of deferred financing costs related to the issuance of
additional senior unsecured debt.

       Depreciation and other amortization increased by approximately $29.7
million due primarily to the additional depreciation and amortization related to
the properties acquired after December 31, 1996 and the distribution of 173
properties from the Financing Partnership to the Operating Partnership on
January 2, 1998 (between January 1, 1997 and September 30, 1998, the
Consolidated Operating Partnership acquired approximately $1.3 billion of
industrial properties, of which, approximately $1.0 billion was acquired
subsequent to September 30, 1997).

       Equity in Income of Other Real Estate Partnerships increased by
approximately $2.0 million due primarily to four of the Other Real Estate
Partnerships having a greater amount of in-service properties for the nine
months ended September 30, 1998 compared to the nine months ended September 30,
1997, offset by a decrease in net income in one of the Other Real Estate
Partnerships due to the distribution of 173 properties to the Operating
Partnership on January 2, 1998.




                                       19
<PAGE>   21

      The $4.0 million gain on disposition of interest rate protection
agreements for the nine months ended September 30, 1997 represents the sale of
the Operating Partnership's interest rate protection agreements.

      The $.7 million gain on sales of properties, net of federal income tax,
for the nine months ended September 30, 1998 resulted from the sale of seven
existing industrial properties and one land parcel. Gross proceeds from these
sales were approximately $13.5 million.

      The $.5 million gain on sales of properties for the nine months ended
September 30, 1997 resulted from the sale of two existing industrial properties
and one land parcel. Gross proceeds from these sales were approximately $12.5
million.

      The $3.4 million extraordinary loss for the nine months ended September
30, 1997 consists of the write-off of unamortized deferred financing fees, legal
costs and other expenses incurred in retiring the Company's $309.8 million
unsecured loan from an institutional investor (the "Defeasance Loan").

      The $.7 million cumulative effect of change in accounting principle for
the nine months ended September 30, 1998 is the result of the write-off of the
unamortized balance of organizational costs on the Consolidated Operating
Partnership's balance sheet due to the early adoption of Statement of Position
98-5, "Reporting on the Costs of Start-Up Activities", ("SOP 98-5"), as further
discussed later in this Management's Discussion and Analysis.

COMPARISON OF THREE MONTHS ENDED SEPTEMBER 30, 1998 TO THREE MONTHS ENDED 
SEPTEMBER 30, 1997

       Rental income and tenant recoveries and other income increased by
approximately $53.1 million or 221.1% due primarily to the properties acquired
or developed after June 30, 1997 and the distribution of 173 properties from the
Financing Partnership to the Operating Partnership on January 2, 1998 (between
July 1, 1997 and September 30, 1998, the Consolidated Operating Partnership
acquired approximately $1.1 billion of industrial properties, of which,
approximately $1.0 billion was acquired subsequent to September 30, 1997).
Revenues from properties owned prior to April 1, 1997, increased by
approximately $1.3 million or 3.4% due to general rent increases and an increase
in tenant recovery income charges due to an increase in property operating
expenses as discussed below.

       Property expenses, which include real estate taxes, repairs and
maintenance, property management, utilities, insurance and other expenses,
increased by approximately $15.9 million or 238.8% due primarily to the
properties acquired or developed after June 30, 1997 and the distribution of 173
properties from the Financing Partnership to the Operating Partnership on
January 2, 1998 (between July 1, 1997 and September 30, 1998, the Consolidated
Operating Partnership acquired approximately $1.1 billion of industrial
properties, of which, approximately $1.0 billion was acquired subsequent to
September 30, 1997). Expenses from properties owned prior to April 1, 1997,
increased by approximately $.7 million or 6.0% due to an increase in real estate
tax expense and utilities expense in the majority of the Consolidated Operating
Partnership's metropolitan areas during the three months ended September 30,
1998 as compared to the three months ended September 30, 1997.

       General and administrative expense increased by approximately $2.6
million, of which approximately $1.8 million is due primarily to the additional
expenses associated with managing the Consolidated Operating Partnership's
growing operations, including additional professional fees relating to
additional properties owned and additional personnel to manage and expand the
Consolidated Operating Partnership's business. Approximately $.8 million of the
increase is the result of the adoption of EITF 97-11 which requires that
internal costs of preacquisition activities incurred in connection with the
acquisition of an operating property should be expensed as incurred. The
Consolidated Operating Partnership adopted EITF 97-11 on March 19, 1998.


                                      20

<PAGE>   22

       Interest expense increased by approximately $11.6 million for the three
months ended September 30, 1998 compared to the three months ended September 30,
1997 due primarily to a higher average debt balance outstanding resulting from
the issuance of senior unsecured debt to fund the acquisition and development of
additional properties (between July 1, 1997 and September 30, 1998, the
Consolidated Operating Partnership acquired approximately $1.1 billion of
industrial properties, of which, approximately $1.0 billion was acquired
subsequent to September 30, 1997).

       Amortization of interest rate protection agreements and deferred
financing costs increased by approximately $.1 million due primarily to
additional amortization of deferred financing costs related to the issuance of
additional senior unsecured debt.

       Depreciation and other amortization increased by approximately $10.4
million due primarily to the additional depreciation and amortization related to
the properties acquired after June 30, 1997 and the distribution of 173
properties from the Financing Partnership to the Operating Partnership on
January 2, 1998 (between July 1, 1997 and September 30, 1998, the Consolidated
Operating Partnership acquired approximately $1.1 billion of industrial
properties, of which, approximately $1.0 billion was acquired subsequent to
September 30, 1997).

       Equity in Income of Other Real Estate Partnerships decreased by
approximately $4.0 million due primarily to a decrease in net income in one of
the Other Real Estate Partnerships due to the distribution of 173 properties to
the Operating Partnership on January 2, 1998, offset by four of the Other Real
Estate Partnerships having a greater amount of in-service properties for the
three months ended September 30, 1998 compared to the three months ended
September 30, 1997.

       The $.6 million gain on sales of properties, net of federal income tax,
for the three months ended September 30, 1998 resulted from the sale of five
existing industrial properties. Gross proceeds from these sales were
approximately $6.4 million.

       The $.1 million gain on sales of properties for the three months ended
September 30, 1997 resulted from the sale of one land parcel. Gross proceeds
from these sales were approximately $.3 million.

LIQUIDITY AND CAPITAL RESOURCES

       On September 30, 1998, the Consolidated Operating Partnership's cash and
cash equivalents totaled approximately $2.6 million and restricted cash was
approximately $2.1 million. Included in restricted cash was approximately $2.1
million of net proceeds from the sale of a property. These sales proceeds will
be disbursed as the Operating Partnership exchanges into properties under
Section 1031 of the Internal Revenue Code.

NINE  MONTHS ENDED SEPTEMBER 30, 1998

       Net cash provided by operating activities of approximately $92.4 million
for the nine months ended September 30, 1998 was comprised primarily of net
income of approximately $72.1 million, adjustments for non-cash items of
approximately $17.7 million and the net change in operating assets and
liabilities of approximately $2.6 million. The adjustments for the non-cash
items are primarily comprised of depreciation and amortization, the cumulative
effect of a change in accounting principle due to the adoption of SOP 98-5 (as
further discussed later in this Management's Discussion and Analysis) and a
provision for bad debts, offset by equity in income of Other Real Estate
Partnerships, the gain on sales of real estate and the effect of the
straight-lining of rental income.

       Net cash used in investing activities of approximately $520.4 million for
the nine months ended September 30, 1998 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, closing costs
from the sales of real estate, contributions to investment in Other Real Estate
Partnerships and an increase in 



                                      21

<PAGE>   23

restricted cash due to a Section 1031 exchange, offset by distributions from
investment in Other Real Estate Partnerships, the proceeds from the sales of
real estate and the repayment of mortgage loans receivable.

       Net cash provided by financing activities of approximately $425.5 million
for the nine months ended September 30, 1998 was comprised primarily of Unit
(defined below) and preferred general partnership unit contributions, net
proceeds from the issuance of senior unsecured debt, net borrowings under the
Operating Partnership's $300.0 million unsecured revolving credit facility (the
"1997 Unsecured Acquisition Facility") and net proceeds from the issuance of
senior unsecured debt, offset by Unit (defined below) and preferred general
partnership unit distributions and repayments on mortgage loans payable.

NINE MONTHS ENDED SEPTEMBER 30, 1997

       Net cash provided by operating activities of approximately $20.9 million
for the nine months ended September 30, 1997 was comprised primarily of net
income of approximately $35.6 million, adjustments for non-cash items of
approximately $11.3 million and the net change in operating assets and
liabilities of approximately $3.4 million. The adjustments for the non-cash
items are primarily comprised of depreciation and amortization, extraordinary
loss and a provision for bad debts, offset by equity in income of Other Real
Estate Partnerships, the gain on disposition of interest rate protection
agreements, the gain on sales of real estate and the effect of the
straight-lining of rental income.

       Net cash used in investing activities of approximately $563.3 million for
the nine months ended September 30, 1997 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, closing costs
from the sales of real estate, contributions to investment in Other Real Estate
Partnerships and the funding of mortgage loans receivable, offset by the
proceeds from sales of real estate, distributions from investment in Other Real
Estate Partnerships and the repayment of mortgage loans receivable.

       Net cash provided by financing activities of approximately $538.1 million
for the nine months ended September 30, 1997 was comprised primarily of Unit
(defined below) contributions, net proceeds from the issuance of senior
unsecured debt, net borrowings under the Operating Partnership's $200.0 million
unsecured revolving credit facility, proceeds from the Defeasance Loan, and
proceeds from the sale of Interest Rate Protection Agreements, offset by Unit
(defined below) and preferred general partnership unit Distributions, repayments
on mortgage loans payable, promissory notes payable and the Defeasance Loan.

RATIO OF EARNINGS TO FIXED CHARGES

       The ratio of earnings to fixed charges and preferred unit distributions
was 1.69 for the nine months ended September 30, 1998 compared to 2.38 for the
nine months ended September 30, 1997. The decrease is primarily due to
additional interest expense and preferred unit distributions incurred during the
nine months ended September 30, 1998 from additional debt issued and preferred
general partner contributions, respectively, to fund property acquisitions and
developments, which is partially offset by higher net operating income from
property acquisitions and the distribution of 173 properties from the Financing
Partnership to the Operating Partnership on January 2, 1998 as discussed in
"Results of Operations" above.

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

       During the nine months ended September 30, 1998, the Consolidated
Operating Partnership purchased 207 industrial properties and several land
parcels, for an aggregate purchase price of approximately $471.4 million,
excluding costs incurred in conjunction with the acquisition price.




                                   22
<PAGE>   24
       Of the 207 existing industrial properties and several land parcels
purchased by the Consolidated Operating Partnership during the nine months ended
September 30, 1998, four existing industrial properties were purchased from
Western Suburban Industrial Investments Limited Partnership ("Western") in which
the sole general partner, having a 5% interest, was Tomasz/Shidler Investment
Corporation, the sole shareholders of which were a Director of the general
partner of the Operating Partnership and a Director/Officer of the general
partner of the Operating Partnership who also had a 53% and 32% limited
partnership interest in Western, respectively. Further, an additional
Director/Officer of the general partner of the Operating Partnership was a
limited partner in Western having an interest of 2%. The aggregate purchase
price for this acquisition totaled approximately $7.9 million, excluding costs
incurred in conjunction with the acquisition of the properties.

       During the second quarter of 1998, the Operating Partnership completed an
acquisition of a real estate firm for which an officer and an employee of the
Operating Partnership owned a 77.5% interest. Gross proceeds to the real estate
firm totaled approximately $2.3 million.

       The Consolidated Operating Partnership has committed to the construction
of five development projects totaling approximately .5 million square feet of
GLA. The estimated total construction costs are approximately $21.3 million.
These developments are expected to be funded with cash flow from operations as
well as borrowings under the Operating Partnership's 1997 Unsecured Acquisition
Facility.

       During the nine months ended September 30, 1998, the Consolidated
Operating Partnership sold seven existing industrial properties and one land
parcel. Gross proceeds from these sales were approximately $13.5 million. The
gain on sales of real estate was approximately $.7 million, net of federal
income taxes.

       From October 1, 1998 to November 6, 1998, the Operating Partnership
acquired 15 industrial properties. The aggregate purchase price for these
acquisitions totaled approximately $14.8 million, excluding costs incurred in
conjunction with the acquisition of the properties.

INVESTMENT IN JOINT VENTURE

     On September 28, 1998, the Operating Partnership entered into a joint
venture arrangement (the "September 1998 Joint Venture") with an institutional
investor to invest in industrial properties. The Operating Partnership, through
wholly owned limited liability companies, will own a 10% equity interest in the
September 1998 Joint Venture and will provide property and asset management
services to the September 1998 Joint Venture. On October 9, 1998, October 23,
1998 and November 6, 1998, the September 1998 Joint Venture acquired
approximately $100 million, $37 million and $62 million, respectively, of
industrial properties and expects to acquire approximately an additional $101
million of industrial properties. The acquisition of additional properties is
subject to, among other contingencies, due diligence and the negotiation of
definitive documentation. There can be no assurance that such acquisitions will
be completed. The Operating Partnership will account for the September 1998
Joint Venture under the equity method of accounting. The Operating Partnership's
investment in the September 1998 Joint Venture relating to these transactions
approximates $4 million.

MORTGAGE LOANS AND SENIOR UNSECURED DEBT

       On April 16, 1998, the Operating Partnership assumed a mortgage loan in
the principal amount of $2.5 million (the "Acquisition Mortgage Loan IV"). The
Acquisition Mortgage Loan IV is collateralized by one property in Baltimore,
Maryland, bears interest at a fixed rate of 8.95% and provides for monthly
principal and interest payments based on a 20-year amortization schedule. The
Acquisition Mortgage Loan IV matures on October 1, 2006. The Acquisition
Mortgage Loan IV may be prepaid only after October 2001 in exchange for the
greater of a 1% prepayment fee or a yield maintenance premium. 





                                      23
<PAGE>   25

       On August 31, 1998, the Consolidated Operating Partnership, assumed a
mortgage loan in the principal amount of $1.0 million (the "Acquisition Mortgage
Loan VI"). The Acquisition Mortgage Loan VI is collateralized by one property in
Portland, Oregon, bears interest at a fixed rate of 8.875% and provides for
monthly principal and interest payments based on a 20-year amortization
schedule. The Acquisition Mortgage Loan VI matures on November 1, 2006. The
Acquisition Mortgage Loan VI may be prepaid only after September 2001 in
exchange for a 3% prepayment fee.

       On August 31, 1998, the Operating Partnership, assumed a
mortgage loan in the principal amount of $1.4 million (the "Acquisition Mortgage
Loan VII"). The Acquisition Mortgage Loan VII is collateralized by one property
in Milwaukie, Oregon, bears interest at a fixed rate of 9.75% and provides for
monthly principal and interest payments based on a 25-year amortization
schedule. The Acquisition Mortgage Loan VII matures on March 15, 2002. The
Acquisition Mortgage Loan VII may be prepaid only after December 2001.

       On March 31, 1998, the Operating Partnership issued $100.0
million of Dealer remarketable securities which mature on April 5, 2011 and bear
a coupon interest rate of 6.50% (the "2011 Drs."). The issue price of the 2011
Drs. was 99.753%. Interest is paid semi-annually in arrears on April 5 and
October 5. The 2011 Drs. are callable (the "Call Option"), at the option of J.P.
Morgan Securities, Inc., as Remarketing Dealer (the "Remarketing Dealer"), on
April 5, 2001 (the "Remarketing Date"). The Operating Partnership
received approximately $2.8 million of proceeds from the Remarketing Dealer as
consideration for the Call Option. The Operating Partnership will
amortize the proceeds over the life of the Call Option as an adjustment to
interest expense. If the holder of the Call Option calls the 2011 Drs. and
elects to remarket the 2011 Drs., then after the Remarketing Date, the interest
rate on the 2011 Drs. will be reset at a fixed rate until April 5, 2011 based
upon a predetermined formula as disclosed in the related Prospectus Supplement.
If the Remarketing Dealer elects not to remarket the 2011 Drs., then the
Operating Partnership will be required to repurchase, on the
Remarketing Date, any 2011 Drs. that have not been purchased by the Remarketing
Dealer at 100% of the principal amount thereof, plus accrued and unpaid
interest, if any. The Operating Partnership also settled an
interest rate protection agreement, in the notional amount of $100.0 million,
which was used to fix the interest rate on the 2011 Drs. prior to issuance. The
debt issue discount and the settlement amount of the interest rate protection
agreement are being amortized over the life of the 2011 Drs. as an adjustment to
interest expense. The 2011 Drs. contain certain covenants including limitations
on incurrence of debt and debt service coverage.

       On July 14, 1998, the Operating Partnership issued $200.0
million of senior unsecured debt which matures on July 15, 2028 and bears a
coupon interest rate of 7.60% (the "2028 Notes"). The issue price of the 2028
Notes was 99.882%. Interest is paid semi-annually in arrears on January 15 and
July 15. The Operating Partnership also settled interest rate
protection agreements, in the notional amount of $150.0 million, which were used
to fix the interest rate on the 2028 Notes prior to issuance. The debt issue
discount and the settlement amount of the interest rate protection agreements
are being amortized over the life of the 2028 Notes as an adjustment to the
interest expense. The 2028 Notes contain certain covenants including limitation
on incurrence of debt and debt service coverage. Approximately $50.0 million of
the 2028 Notes was purchased, through a broker/dealer, by an entity in which 
a Director of the Company owns greater than a ten percent interest.

       On November 5, 1998, the Operating Partnership settled its remaining
interest rate protection agreement which was scheduled to expire on January 4,
1999. This agreement was entered into in December 1997 in anticipation of 1998
senior unsecured debt offerings. Due to the changing market conditions and the
Operating Partnership's expectation that it will not issue debt securities
associated with the interest rate protection agreement, it is the Operating
Partnership's belief that the interest rate protection agreement no longer
qualifies for hedge accounting treatment under generally accepted accounting
principles. As a result, the Operating Partnership will recognize an expense of
approximately $8.5 million associated with the termination of this interest rate
protection agreement in the fourth quarter of 1998.




                                      24
<PAGE>   26

GENERAL PARTNERSHIP, LIMITED PARTNERSHIP AND PREFERRED GENERAL PARTNERSHIP UNIT 
CONTRIBUTIONS

       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 (see discussion below). 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 nine months ended September 30, 1998, the Operating
Partnership issued 1,441 Units valued, in the aggregate, at $47.5 million in
exchange for interests in certain properties. These contributions are reflected
in the Consolidated Operating Partnership's financial statements as limited
partners contributions.

       On April 23, 1998, the Company issued, in a private placement, 1,112,644
shares of $.01 par value Common Stock (the "April 1998 Equity Offering"). The
net proceeds of approximately $34.1 million received from the April 1998 Equity
Offering were contributed to the Operating Partnership in exchange for 1,112,644
Units in the Operating Partnership and are reflected in the Operating
Partnership's financial statements as a general partner contribution.

       During the nine months ended September 30, 1998, certain employees of the
Company exercised 103,500 employee stock options. Gross proceeds to the Company
approximated $2.4 million. The gross proceeds from the option exercises were
contributed to the Operating Partnership in exchange for Units and are reflected
in the Consolidated Operating Partnership's financial statements as a general
partner contribution.

       During the nine months ended September 30, 1998, the Company awarded
51,850 shares of restricted Common Stock to certain employees and 1,887 shares
of restricted Common Stock to certain Directors. Other employees of the Company
converted certain employee stock options to 13,602 shares of restricted Common
Stock. The Operating Partnership issued Units to the Company in the same amount.
These shares of restricted Common Stock had a fair value of approximately $2.3
million on the date of grant. The restricted Common Stock vests over a period
from five to ten years. Compensation expense will be charged to earnings over
the vesting period.

Preferred Unit Contributions:

       On February 4, 1998, the Company issued 5,000,000 Depository Shares, each
representing 1/100th of a share of the Company's 7.95%, $.01 par value, Series D
Cumulative Preferred Stock (the "Series D Preferred Stock"), at an initial
offering price of $25 per Depository Share. The net proceeds of $120.6 million
received from the Series D Preferred Stock were contributed to the Operating
Partnership in exchange for 7.95% Series D Cumulative Preferred Units (the
"Series D Preferred Units") and are reflected in the Operating Partnership's
financial statements as a general partner preferred unit contribution.

       On March 18 1998, the Company issued 3,000,000 Depository Shares, each
representing 1/100th of a share of the Company's 7.90%, $.01 par value, Series E
Cumulative Preferred Stock (the "Series E Preferred Stock"), at an initial
offering price of $25 per Depository Share. The net proceeds of $72.1 million
received from the Series E Preferred Stock were contributed to the Operating
Partnership in exchange for 7.90% Series E Cumulative Preferred Units (the
"Series E Preferred Units") 





                                      25
<PAGE>   27
and are reflected in the Consolidated Operating Partnership's financial
statements as a general partner preferred unit contribution.

Non-Qualified Employee Stock Options:

      On January 2, 1998, the Company granted 4,370,000 non-qualified employee
stock options. These stock options vest over three years based upon certain
performance measures. The stock options have a strike price of $35.8125 per
share and expire ten years from the date of grant. The exercise of these stock
options will result in the issuance of Units to the Company in the same amount.

       On May 14, 1998, the Company granted 899,000 non-qualified employee stock
options. These stock options vest over one year and have a strike price of
$31.13 per share. The stock options expire between seven and ten years from the
date of grant. The exercise of these stock options will result in the issuance
of Units to the Company in the same amount.

DISTRIBUTIONS

       On January 20, 1998, the Operating Partnership paid a fourth
quarter 1997 distribution of $.53 per unit, totaling approximately $22.0
million. On April 20, 1998, the Operating Partnership paid a first
quarter 1998 distribution of $.53 per unit, totaling approximately $22.5
million. On July 20, 1998, the Operating Partnership paid a second
quarter 1998 distribution of $.53 per unit, totaling approximately $23.6
million. On October 19, 1998, the Operating Partnership paid a
third quarter 1998 distribution of $.53 per unit, totaling approximately $23.7
million.

       On March 31, 1998, the Operating Partnership paid a first
quarter distribution of $54.688 per unit on its Series B Cumulative Preferred
units. On March 31, 1998, the Operating Partnership paid a first
quarter distribution of $53.906 per unit on its Series C Cumulative Preferred
units. On March 31, 1998, the Operating Partnership paid a second
quarter distribution of $30.365 per unit on its Series D Preferred units. The
preferred unit distributions paid on March 31, 1998 totaled, in the aggregate,
approximately $4.8 million. On March 31, 1998, the Operating
Partnership accrued $7.13194 per Series E Preferred unit, totaling $.2 million
for the three months ended March 31, 1998.

       On June 30, 1998, the Operating Partnership paid a second
quarter distribution of $54.688 per unit on its Series B Cumulative Preferred
units. On June 30, 1998, the Operating Partnership paid a second
quarter distribution of $53.906 per unit on its Series C Cumulative Preferred
units. On June 30, 1998, the Operating Partnership paid a second
quarter distribution of $49.687 per unit on its Series D Preferred units. On
June 30, 1998, the Operating Partnership paid a period prorated
first quarter distribution and a second quarter distribution totaling $56.5069
per unit on its Series E Preferred units. The preferred unit distributions paid
on June 30, 1998 totaled, in the aggregate, approximately $7.4 million.

       On September 30, 1998, the Operating Partnership paid a
third quarter distribution of $54.688 per unit on its Series B Cumulative
Preferred units. On September 30, 1998, the Operating Partnership
paid a third quarter distribution of $53.906 per unit on its Series C Cumulative
Preferred units. On September 30, 1998, the Operating Partnership
paid a third quarter distribution of $49.687 per unit on its Series D Preferred
units. On September 30, 1998, the Operating Partnership a third
quarter distribution of $49.375 per unit on its Series E Preferred units. The
preferred unit distributions paid on September 30, 1998 totaled, in the
aggregate, approximately $7.2 million.




                                      26


<PAGE>   28


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 principal 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, scheduled
debt maturities, major renovations, expansions and other nonrecurring capital
improvements through long-term secured and unsecured indebtedness and the
issuance of additional Units and preferred units. As of September 30, 1998 and
November 6, 1998, $100.0 million of debt securities was registered and unissued
under the Securities Act of 1933, as amended. The Operating Partnership may
finance the development or acquisition of additional properties through
borrowings under the 1997 Unsecured Acquisition Facility. At September 30, 1998,
borrowings under the 1997 Unsecured Acquisition Facility bore interest at a
weighted average interest rate of 6.49%. As of November 6, 1998, the Operating
Partnership had approximately $153.2 million available in additional borrowings
under the 1997 Unsecured Acquisition Facility. Along with the Consolidated
Operating Partnership's current strategy of meeting long-term liquidity
requirements through the issuance, from time to time, of long-term secured and
unsecured indebtedness and additional equity securities, the Operating
Partnership is actively considering joint ventures with various institutional
partners and the disposition of select assets as additional financing
strategies. On September 28, 1998, the Operating Partnership, entered into the
September 1998 Joint Venture. On October 9, 1998, October 23, 1998 and November
6, 1998, the September 1998 Joint Venture obtained financing for the acquisition
of approximately $100 million, $37 million and $62 million of industrial
properties, respectively. The Operating Partnership expects the September 1998
Joint Venture to obtain financing for the acquisition of an additional
approximately $101 million of industrial properties. Such additional financing
of acquisitions by the September 1998 Joint Venture is subject to, among other
contingencies, due diligence and the negotiation of definitive documentation.
There can be no assurance that the September 1998 Joint Venture will be
successful in obtaining such additional financing.

RELATED PARTY TRANSACTIONS

       From time to time, the Operating Partnership utilizes leasing services
from an entity for which one of the Company's Officers owns a 62.5% ownership
interest. From January 1, 1998 through September 30, 1998, the Operating
Partnership has paid approximately $.2 million of leasing commissions to this
entity.


YEAR 2000 COMPLIANCE

       The Year 2000 compliance issue concerns the inability of computerized
information systems and non-information systems to accurately calculate, store
or use a date after 1999. This could result in computer systems failures or
miscalculations causing disruptions of operations. The Year 2000 issue affects
almost all companies and organizations.

       The Consolidated Operating Partnership has discussed its software
applications and internal operational programs with its current information
systems' vendor and, based on such discussions, believes that such applications
and programs will properly recognize calendar dates beginning in the year 2000.
The Consolidated Operating Partnership is discussing with its material
third-party service providers, such as its banks, payroll processor and
telecommunications provider, their Year 2000 compliance and is assessing what
effect their possible non-compliance might have on the Consolidated 





                                       27
<PAGE>   29

Operating Partnership. In addition, the Consolidated Operating Partnership is
discussing with its material vendors the possibility of any interface
difficulties and/or electrical or mechanical problems relating to the year 2000
which may affect properties owned by the Consolidated Operating Partnership. The
Consolidated Operating Partnership has also surveyed substantially all of its
tenants to determine the status of their Year 2000 compliance and what effect
their possible non-compliance might have on the Consolidated Operating
Partnership. The Consolidated Operating Partnership is currently processing the
information obtained from such tenant surveys and remains in discussions with
its material vendors and third-party service providers. Of the tenant surveys
processed to date, all have stated that they are Year 2000 compliant or will be
Year 2000 compliant by the end of 1999. The Consolidated Operating Partnership
plans to complete its assessment of Year 2000 compliance by such parties by
March 31, 1999. Until such time the Consolidated Operating Partnership cannot
estimate any potential adverse impact resulting from the failure of tenants,
vendors or third-party service providers to address their Year 2000 issues;
however, to date, no significant Year 2000-related conditions have been
identified.

       Because the Consolidated Operating Partnership's evaluation of its Year
2000 issues has been conducted by its own personnel or by its vendors in
connection with their servicing operations, the Consolidated Operating
Partnership believes that its expenditures for assessing its Year 2000 issues,
though difficult to quantify, to date have not been material. In addition, the
Consolidated Operating Partnership is not aware of any Year 2000-related
conditions that it believes would likely require any material expenditures by
the Consolidated Operating Partnership in the future.

       Based on its current information, the Consolidated Operating Partnership
believes that the risk posed by any foreseeable Year 2000-related problem with
its internal systems and the systems at its properties (including both
information and non-information systems) or with its vendors or tenants is
minimal. Year 2000-related problems with the Consolidated Operating
Partnership's software applications and internal operational programs or with
the electrical or mechanical systems at its properties are unlikely to cause
more than minor disruptions in the Consolidated Operating Partnership's
operations. The Consolidated Operating Partnership believes that the risk posed
by Year 2000-related problems at certain of its third-party service providers,
such as its banks, payroll processor and telecommunications provider is
marginally greater, though, based on its current information, the Consolidated
Operating Partnership does not believe any such problems would have a material
effect on its operations. Any Year 2000 related problems at such third-party
service providers could delay the processing of financial transactions and the
Consolidated Operating Partnership's payroll and could disrupt the Consolidated
Operating Partnership's internal and external communications. At this time, the
Consolidated Operating Partnership has not developed and does not anticipate
developing any contingency plans with respect to Year 2000 issues. In addition,
the Consolidated Operating Partnership has no plans to seek independent
verification or review of its assessment of its Year 2000 issues. The
Consolidated Operating Partnership does intend to complete its assessment of,
and to continue to monitor, its Year 2000 issues and will develop contingency
plans if, and to the extent, deemed necessary.

       While the Consolidated Operating Partnership believes that it will be
Year 2000 compliant by December 31, 1999, there can be no assurance that the
Consolidated Operating Partnership has been or will be successful in identifying
and assessing Year 2000 issues, or that, to the extent identified, the
Consolidated Operating Partnership's efforts to remediate such issues will be
effective such that Year 2000 issues will not have a material adverse effect on
the Consolidated Operating Partnership's business, financial condition or
results of operation.

OTHER

       In June 1997, the Financial Accounting Standards Board (the "FASB")
issued Statement of Financial Accounting Standards No. 130, "Reporting
Comprehensive Income". This statement, effective for fiscal years beginning
after December 15, 1997, requires the Consolidated Operating Partnership to
report components of comprehensive income in a financial statement that is
displayed with the same prominence as other financial statements. Comprehensive
income is defined by Concepts Statement No.


                                       28
<PAGE>   30


6, "Elements of Financial Statements" as the change in the equity of a business
enterprise during a period from transactions and other events and circumstances
from non-owner sources. It includes all changes in equity during a period except
those resulting from investments by owners and distributions to owners. The
Consolidated Operating Partnership's net income available to its unitholders
approximates its comprehensive income as defined in Concepts Statement No. 6,
"Elements of Financial Statements".

       In June 1997, the FASB issued Statement of Financial Accounting Standards
No. 131, "Disclosures about Segments of an Enterprise and Related Information".
This statement, effective for financial statements for fiscal years beginning
after December 15, 1997, requires that a public business enterprise report
financial and descriptive information about its reportable operating segments.
Generally, financial information is required to be reported on the basis that it
is used internally for evaluating segment performance and deciding how to
allocate resources to segments. The Consolidated Operating Partnership will
disclose this information in its 1998 Form 10-K.

       In March 1998, the FASB's Emerging Issues Task Force (the "Task Force")
issued Emerging Issues Task Force Issue No. 97-11, "Accounting for Internal
Costs Relating to Real Estate Property Acquisitions" ("EITF 97-11"). EITF 97-11,
effective March 19, 1998, requires that internal costs of preacquisition
activities incurred in connection with the acquisition of an operating property
should be expensed as incurred. The Task Force concluded that a property is
considered operating if, at the date of acquisition, major construction activity
is substantially completed on the property and (a) it is held available for
occupancy upon completion of tenant improvements by the acquirer or (b) it is
already income producing. The Consolidated Operating Partnership adopted EITF
97-11 as of March 19, 1998. Prior to March 19, 1998, the Consolidated Operating
Partnership capitalized internal costs of preacquisition activities incurred in
connection with the acquisition of operating properties. The Consolidated
Operating Partnership estimates that the adoption of EITF 97-11 will result in a
cumulative increase of approximately $2.5 million to $3.0 million in the amount
of general and administrative expense reflected in the Consolidated Operating
Partnership's consolidated statement of operations in 1998.

       In April 1998, the Accounting Standards Executive Committee of the
American Institute of Certified Public Accountants issued Statement of Position
98-5, "Reporting on the Costs of Start-Up Activities" ("SOP 98-5"). SOP 98-5
requires that the net unamortized balance of all start-up costs and
organizational costs be written off as a cumulative effect of a change in
accounting principle and all future start-up costs and organizational costs be
expensed. In the second quarter of 1998, the Consolidated Operating Partnership
has reported a cumulative effect of a change in accounting principle in the
amount of $.7 million to reflect the write-off of the unamortized balance of
organizational costs on the Consolidated Operating Partnership's balance sheet.

       During the second quarter of 1998, the FASB issued Statement of Financial
Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities". This statement, effective for fiscal years beginning after June 15,
1999, establishes accounting and reporting standards requiring that every
derivative instrument, including certain derivative instruments imbedded in
other contracts, be recorded in the balance sheet as either an asset or
liability measured at its fair value. The statement also requires that the
changes in the derivative's fair value be recognized in earnings unless specific
hedge accounting criteria are met. The Consolidated Operating Partnership is
currently assessing the impact of this new statement on its consolidated
financial position, liquidity, and results of operations.




                                       29
<PAGE>   31






                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS
   None.

ITEM 2. CHANGES IN SECURITIES
     During the nine months ended September 30, 1998, the Operating Partnership
     issued an aggregate of 1,440,629 limited partnership units having an
     aggregate value of $47.5 million in exchange for property or interests in
     entities owning property. As of November 6, 1998, the Operating Partnership
     has issued in 1998 an aggregate of 1,515,983 limited partnership units
     having an aggregate value of $49.4 million in exchange for property or
     interests in entities owning property.

   All of the above limited partnership units were issued in private placements
   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 issuances.

   Subject to lock-up periods and certain adjustments, limited partnership 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 REPORTS ON FORM 8-K

Exhibit No.   Description
-----------   -----------
      4.1     Supplemental Indenture No. 5, dated as of July 14, 1998, between
              First Industrial, L.P. and U.S. Bank Trust National Association
              relating to First Industrial, L.P.'s 7.6% Notes due July 15, 2008
              (incorporated by reference to Exhibit 4.1 of the Form 8-K of First
              Industrial, L.P. dated July 15, 1998, file No. 33-21873)
      4.2     Sixth Amended and Restated Limited Partnership Agreement of first
              Industrial, L.P. (the "L.P. Agreement"), dated March 18, 1998
              (incorporated by reference to Exhibit 10.1 of the Company's Annual
              Report on form 10-K for the year ended December 31, 1997, File No.
              1-13102)
      4.3     Sixth Amendment to the L.P. Agreement dated August 31, 1998
              (incorporated by reference to Exhibit 10.2 of the Form 10-Q of
              First Industrial Realty Trust, Inc. (the "Company") for the fiscal
              quarter ended September 30, 1998, File No. 1-13102) 
      4.4     Seventh Amendment to the L.P. Agreement dated October 21, 1998
              (incorporated by reference to Exhibit 10.3 of the Form 10-Q of the
              Company for the fiscal quarter ended September 30, 1998, File No.
              1-13102)
      4.5     Eighth Amendment to the L.P. Agreement dated October 30, 1998
              (incorporated by reference to Exhibit 10.4 of the Form 10-Q of the
              Company for the fiscal quarter ended September 30, 1998, File No.
              1-13102
      4.6     Ninth Amendment to the L.P. Agreement dated November 5, 1998
              (incorporated by reference to Exhibit 10.5 of the Form 10-Q of
              the Company for the fiscal quarter ended September 30, 1998, file
              No. 1-13102)
     27.1 *   Financial Data Schedule for the Nine Months Ended September 30,
              1998 

     27.2 *   Financial Data Schedule for the Nine Months Ended September 30,
              1997 (Restated)


----------------------
*  Filed herewith

                                       30
<PAGE>   32


Reports on Form 8-K

     Report on Form 8-K dated November 6, 1998, filed November 12, 1998,
relating to the acquisition of 70 industrial properties by First Industrial,
L.P. and the acquisition of four industrial properties by partnerships in which
First Industrial, L.P. owns a 99% limited partnership interest.




                                       31
<PAGE>   33

                                    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: November 12, 1998         By: /s/ Michael J. Havala                   
                                   ---------------------------------------------
                                    Michael J. Havala
                                    Chief Financial Officer
                                    (Principal Financial and Accounting Officer)



                                       32
<PAGE>   34



                                  EXHIBIT INDEX

<TABLE>
<CAPTION>

Exhibit No.         Description
-----------         -----------
<S>            <C>
      4.1     Supplemental Indenture No. 5, dated as of July 14, 1998, between
              First Industrial, L.P. and U.S. Bank Trust National Association
              relating to First Industrial, L.P.'s 7.6% Notes due July 15, 2008
              (incorporated by reference to Exhibit 4.1 of the Form 8-K of First
              Industrial, L.P. dated July 15, 1998, file No. 33-21873)
      4.2     Sixth Amended and Restated Limited Partnership Agreement of first
              Industrial, L.P. (the "L.P. Agreement"), dated March 18, 1998
              (incorporated by reference to Exhibit 10.1 of the Company's Annual
              Report on form 10-K for the year ended December 31, 1997, File No.
              1-13102)
      4.3     Sixth Amendment to the L.P. Agreement dated August 31, 1998
              (incorporated by reference to Exhibit 10.2 of the Form 10-Q of
              First Industrial Realty Trust, Inc. (the "Company") for the fiscal
              quarter ended September 30, 1998, File No. 1-13102) 
      4.4     Seventh Amendment to the L.P. Agreement dated October 21, 1998
              (incorporated by reference to Exhibit 10.3 of the Form 10-Q of the
              Company for the fiscal quarter ended September 30, 1998, File No.
              1-13102)
      4.5     Eighth Amendment to the L.P. Agreement dated October 30, 1998
              (incorporated by reference to Exhibit 10.4 of the Form 10-Q of the
              Company for the fiscal quarter ended September 30, 1998, File No.
              1-13102
      4.6     Ninth Amendment to the L.P. Agreement dated November 5, 1998
              (incorporated by reference to Exhibit 10.5 of the Form 10-Q of
              the Company for the fiscal quarter ended September 30, 1998, file
              No. 1-13102)
      27.1*   Financial Data Schedule for the Nine Months ended September
              30, 1998 

      27.2*   Financial Data Schedule for the Nine Months Ended September 30,
              1997 (Restated) 
</TABLE>

*Filed herewith.


                                       33