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UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

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FORM 10-K

|ý                                           | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934    
|------------------------------------------- | ----------------------------------------------------------------------------------------
|For the fiscal year ended December 31, 2002
|o                                           | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 333-57103

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MACK-CALI REALTY, L.P.(Exact Name of Registrant as specified in its charter)

Delaware(State or other jurisdiction of
incorporation or organization)

22-3315804(IRS Employer
Identification No.)11 Commerce Drive, Cranford, New Jersey(Address of principal executive offices)

07016-3599(Zip code)


(908) 272-8000(Registrant's telephone number, including area code)

Securities
registered pursuant to Section 12(b) of the Act:

|(Title of Each Class) |  | (Name of Each Exchange on Which Registered)
|--------------------- |  | -------------------------------------------

Securities registered pursuant to Section 12(g) of the Act:
None

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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 (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes ý    No o

Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the
registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendments to this
Form 10-K. o

Indicate
by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b2). Yes ý

LOCATION OF EXHIBIT INDEX:The index of exhibits is contained in Part IV herein on page number 72.

DOCUMENTS INCORPORATED BY REFERENCE:Portions of Mack-Cali Realty Corporation's definitive proxy statement for
fiscal year ended December 31, 2002 to be issued in conjunction with Mack-Cali Realty Corporation's annual meeting of shareholders to be held on May 13, 2003 are incorporated
by reference in Part III of this Form 10-K.

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TABLE OF CONTENTS  FORM 10-K

|         |         |                                                                                                | Page No.
|-------- | ------- | ---------------------------------------------------------------------------------------------- | --------
|PART I   |         |                                                                                                |         
|         | Item 1  | Business                                                                                       |         
|         | Item 2  | Properties                                                                                     |         
|         | Item 3  | Legal Proceedings                                                                              |         
|         | Item 4  | Submission of Matters to a Vote of Security Holders                                            |         
|PART II  |         |                                                                                                |         
|         | Item 5  | Market for Registrant's Common Equity and Related Stockholder Matters                          |         
|         | Item 6  | Selected Financial Data                                                                        |         
|         | Item 7  | Management's Discussion and Analysis of Financial Condition and Results of Operations          |         
|         | Item 7A | Quantitative and Qualitative Disclosures About Market Risk                                     |         
|         | Item 8  | Financial Statements and Supplementary Data                                                    |         
|         | Item 9  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure           |         
|PART III |         |                                                                                                |         
|         | Item 10 | Directors and Executive Officers of the Registrant                                             |         
|         | Item 11 | Executive Compensation                                                                         |         
|         | Item 12 | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |         
|         | Item 13 | Certain Relationships and Related Transactions                                                 |         
|         | Item 14 | Controls and Procedures                                                                        |         
|PART IV  |         |                                                                                                |         
|         | Item 15 | Exhibits, Financial Statements, Schedules and Reports on Form 8-K                              |         

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PART I

ITEM 1.    BUSINESS

GENERAL

Mack-Cali Realty, L.P., a Delaware limited partnership (together with its subsidiaries, the "Operating Partnership"), is a majority-owned subsidiary
of Mack-Cali Realty Corporation, a Maryland corporation (the "Corporation"). The Operating Partnership owns and operates a real estate portfolio comprised predominantly of Class A
office and office/flex properties located primarily in the Northeast. The Operating Partnership performs substantially all commercial real estate leasing, management, acquisition, development and
construction services on an in-house basis. The Operating Partnership was formed on May 31, 1994. The Operating Partnership's executive offices are located at 11 Commerce Drive,
Cranford, New Jersey 07016, and its telephone number is (908) 272-8000. The Corporation has an internet website at www.mack-cali.com.

As
of December 31, 2002, the Operating Partnership owned or had interests in 265 properties, aggregating approximately 29.3 million square feet (collectively, the
"Properties"), plus developable land. The Properties are comprised of: (a) 256 wholly-owned or Operating Partnership controlled properties consisting of 150 office buildings and 95 office/flex
buildings totaling approximately 26.7 million square feet, six industrial/warehouse buildings totaling approximately 387,400 square feet, two stand-alone retail properties and three land leases
(collectively, the "Consolidated Properties"); and (b) six office buildings and one office/flex building aggregating 2.1 million square feet, one stand-alone retail property aggregating
approximately 100,740 square feet and a 350-room hotel, which are owned by unconsolidated joint ventures in which the Operating Partnership has investment interests. Unless otherwise
indicated, all references to square feet represent net rentable area. As of December 31, 2002, the office, office/flex and industrial/warehouse properties included in the Consolidated
Properties (excluding in-service development properties in lease-up) were 92.3 percent leased to approximately 2,100 tenants. See Item 2: Properties. The Properties are
located in eight states, primarily in the Northeast, and the District of Columbia.

The
general partner of the Operating Partnership is the Corporation, which has elected to be treated and operated so as to qualify as a real estate investment trust ("REIT") under the
Internal Revenue Code of 1986, as amended. The common stock, par value $0.01, of the Corporation (the "Common Stock") is listed on the New York Stock Exchange and the Pacific Exchange under the symbol
"CLI." Substantially all of the Corporation's interests in the Properties are held through, and its operations are conducted through, the Operating Partnership, or through entities controlled by the
Operating Partnership. As of February 14, 2003, 57,457,079 shares of Common Stock were outstanding. Also, as of February 14, 2003, the Corporation owned an 80.3 percent general
partnership interest in the Operating Partnership, assuming conversion of all preferred limited partnership units of the Operating Partnership into common limited partnership units. Without giving
effect to the preferred limited partnership units of the Operating Partnership, the Corporation would own an 88.0 percent general partnership interest in the Operating Partnership. As used
herein, the term "Units" refers to common limited partnership interests in the Operating Partnership. Units are redeemable for an equal number of shares of Common Stock or cash.

The
Operating Partnership's strategy has been to focus its operations, acquisition and development of office properties in markets and sub-markets where it believes it is, or
can become, a significant and preferred owner and operator. The Operating Partnership will continue this strategy by expanding, through acquisitions and/or development in Northeast markets and
sub-markets where it has, or can achieve, similar status. The Operating Partnership believes that its Properties have excellent locations and access and are well-maintained and
professionally managed. As a result, the Operating Partnership believes that its Properties attract high quality tenants and achieve among the highest rental, occupancy and tenant retention rates
within their markets. The Operating Partnership also believes that its

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extensive market knowledge provides it with a significant competitive advantage which is further enhanced by its strong reputation for, and emphasis on, delivering highly responsive, professional
management services. See "Business Strategies".

The
Corporation's executive officers have been employed by the Corporation and/or its predecessor companies for an average of approximately 15 years.

BUSINESS STRATEGIES

Operations

Reputation:The Operating Partnership has established a reputation as a highly-regarded landlord with an emphasis on
delivering quality tenant services in buildings it owns and/or manages. The Operating Partnership believes that its continued success depends in part on enhancing its reputation as an operator of
choice, which will facilitate the retention of current tenants and the attraction of new tenants. The Operating Partnership believes it provides a superior level of service to its tenants, which
should in turn allow the Operating Partnership to outperform the market with respect to occupancy rates, as well as improve tenant retention.

Communication with tenants:The Operating Partnership emphasizes frequent communication with tenants to ensure first-class
service to the Properties. Property managers generally are located on site at the Properties to provide convenient access to management and to ensure that the Properties are
well-maintained. Property management's primary responsibility is to ensure that buildings are operated at peak efficiency in order to meet both the Operating Partnership's and tenants'
needs and expectations. Property managers additionally budget and oversee capital improvements and building system upgrades to enhance the Properties' competitive advantages in their markets and to
maintain the quality of the Operating Partnership's properties.

Additionally,
the Operating Partnership's in-house leasing representatives develop and maintain long-term relationships with the Operating Partnership's diverse
tenant base and coordinate leasing, expansion, relocation and build-to-suit opportunities within the Operating Partnership's portfolio. This approach allows the Operating
Partnership to offer office space in the appropriate size and location to current or prospective tenants in any of its sub-markets.

Growth

The Operating Partnership plans to continue to own and operate a portfolio of properties in high-barrier-to-entry markets,
with a primary focus in the Northeast. The Operating Partnership's primary objectives are to maximize funds from operations and to enhance the value of its portfolio through effective management,
acquisition, development and property sales strategies, as follows:

Internal Growth:The Operating Partnership seeks to maximize the value of its existing portfolio through implementing
operating strategies designed to produce the highest effective rental and occupancy rates and lowest tenant installation cost within the markets that it operates. The Operating Partnership continues
to pursue internal growth through re-leasing space at higher effective rents with contractual rent increases and developing or redeveloping space for its diverse base of high credit
tenants, including IBM Corporation, Nabisco Inc. and Allstate Insurance Company. In addition, the Operating Partnership seeks economies of scale through volume discounts to take advantage of
its size and dominance in particular sub-markets, and operating efficiencies through the use of in-house management, leasing, marketing, financing, accounting, legal,
development and construction services.

Acquisitions:The Operating Partnership also believes that growth opportunities exist through acquiring operating properties
or properties for redevelopment with attractive returns in its core Northeast sub-markets where, based on its expertise in leasing, managing and operating properties, it

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believes it is, or can become, a significant and preferred owner and operator. The Operating Partnership intends to acquire, invest in or redevelop additional properties that: (i) provide
attractive initial yields with potential for growth in cash flow from operations; (ii) are well-located, of high quality and competitive in their respective sub-markets;
(iii) are located in its existing sub-markets or in sub-markets in which the Operating Partnership can become a significant and preferred owner and operator; and
(iv) have been under-managed or are otherwise capable of improved performance through intensive management, capital improvements and/or leasing that should result in increased occupancy and
rental revenues.

Development:The Operating Partnership seeks to selectively develop additional properties where it believes such development
will result in a favorable risk-adjusted return on investment in coordination with the above operating strategies. Such development primarily will occur: (i) when leases have been
executed prior to construction; (ii) in stable core Northeast sub-markets where the demand for such space exceeds available supply; and (iii) where the Operating Partnership
is, or can become, a significant and preferred owner and operator.

Property Sales:While management's principal intention is to own and operate its properties on a long-term basis,
it is constantly assessing the attributes of each of its properties, with a particular focus on the supply and demand fundamentals of the sub-markets in which they are located. Based on
these ongoing assessments, the Operating Partnership may, from time to time, decide to sell any of its properties.

Financial

The Operating Partnership currently intends to maintain a ratio of debt-to-undepreciated assets (total debt of the Operating Partnership
as a percentage of total undepreciated assets) of approximately 50 percent or less. As of December 31, 2002, the Operating Partnership's total debt constituted approximately
41.3 percent of total undepreciated assets of the Operating Partnership. The Operating Partnership has three investment grade credit ratings. Standard & Poor's Rating Services ("S&P")
and Fitch, Inc. ("Fitch") have each assigned their BBB rating to existing and prospective senior unsecured debt of the Operating Partnership. S&P and Fitch have also assigned their
BBB- rating to prospective preferred stock offerings of the Corporation. Moody's Investors Service ("Moody's") has assigned its Baa3 rating to existing and prospective senior unsecured
debt of the Operating Partnership and its Ba1 rating to prospective preferred stock offerings of the Corporation. Although there is no limit in the Operating Partnership's organizational documents on
the amount of indebtedness that the Operating Partnership may incur or the requirement for maintenance of investment grade credit ratings, the Operating Partnership has entered into certain financial
agreements which contain covenants that limit the Operating Partnership's ability to incur indebtedness under certain circumstances. The Operating Partnership intends to conduct its operations so as
to best be able to maintain its investment grade rated status. The Operating Partnership intends to utilize the most appropriate sources of capital for
future acquisitions, development, capital improvements and other investments, which may include funds from operating activities, proceeds from property sales, short-term and
long-term borrowings (including draws on the Operating Partnership's revolving credit facility), and the issuance of additional debt or equity securities.

EMPLOYEES

As of December 31, 2002, the Operating Partnership had no employees. The Corporation had approximately 340 full-time employees.

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COMPETITION

The leasing of real estate is highly competitive. The Properties compete for tenants with lessors and developers of similar properties located in their respective
markets primarily on the basis of location, rent charged, services provided, and the design and condition of the Properties. The Operating Partnership also experiences competition when attempting to
acquire or dispose of real estate, including competition from domestic and foreign financial institutions, other REITs, life insurance companies, pension trusts, trust funds, partnerships and
individual investors.

REGULATIONS

Many laws and governmental regulations are applicable to the Properties and changes in these laws and regulations, or their interpretation by agencies and the
courts, occur frequently.

Under
various laws and regulations relating to the protection of the environment, an owner of real estate may be held liable for the costs of removal or remediation of certain hazardous
or toxic substances located on or in the property. These laws often impose liability without regard to whether the owner was responsible for, or even knew of, the presence of such substances. The
presence of such substances may adversely affect the owner's ability to rent or sell the property or to borrow using such property as collateral and may expose it to liability resulting from any
release of, or exposure to, such substances. Persons who arrange for the disposal or treatment of hazardous or toxic substances at another location may also be liable for the costs of removal or
remediation of such substances at the disposal or treatment facility, whether or not such facility is owned or operated by such person. Certain environmental laws impose liability for release of
asbestos-containing materials into the air, and third parties may also seek recovery from owners or operators of real properties for personal injury associated with asbestos-containing materials and
other hazardous or toxic substances.

In
connection with the ownership (direct or indirect), operation, management and development of real properties, the Operating Partnership may be considered an owner or operator of such
properties or as having arranged for the disposal or treatment of hazardous or toxic substances and, therefore, potentially liable for removal or remediation costs, as well as certain other related
costs, including governmental penalties and injuries to persons and property.

There
can be no assurance that (i) future laws, ordinances or regulations will not impose any material environmental liability, (ii) the current environmental condition of
the Properties will not be affected by tenants, by the condition of land or operations in the vicinity of the Properties (such as the presence of underground storage tanks), or by third parties
unrelated to the Operating Partnership, or (iii) the Operating Partnership's assessments reveal all environmental liabilities and that there are no material environmental liabilities of which
the Operating Partnership is aware. If compliance with the various laws and regulations, now existing or hereafter adopted, exceeds the Operating Partnership's budgets for such items, the Operating
Partnership's ability to make expected distributions to stockholders could be adversely affected.

There
are no other laws or regulations which have a material effect on the Operating Partnership's operations, other than typical federal, state and local laws affecting the development
and operation of real property, such as zoning laws.

INDUSTRY SEGMENTS

The Operating Partnership operates in only one industry segmentreal estate. The Operating Partnership does not have any foreign operations and its
business is not seasonal. Please see our financial statements attached hereto and incorporated by reference herein for financial information relating to our industry segment.

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RECENT DEVELOPMENTS

As a result of the economic climate in 2002, substantially all of the real estate markets the Operating Partnership operates in materially softened. Demand for
office space declined significantly and vacancy rates increased in each of the Operating Partnership's core markets since the first quarter of 2001. Through February 14, 2003, the Operating
Partnership's core markets continued to be weak. The percentage leased in the Operating Partnership's consolidated portfolio of stabilized operating properties decreased to 92.3 percent at
December 31, 2002, as compared to 94.6 percent at December 31, 2001 and 96.8 percent at December 31, 2000. Percentage leased includes all leases in effect as of the
period end date, some of which have commencement dates in the future and leases that expire at the period end date. Market rental rates have declined in most markets from peak levels in late 2000 and
early 2001. Rental rates on the Operating Partnership's space that was re-leased during the year ended December 31, 2002 increased an average of 3.0 percent compared to rates
that were in effect under expiring leases, as compared to a 9.5 percent increase in 2001 and a 12.9 percent increase in 2000. The Operating Partnership believes that vacancy rates may
continue to increase in most of its markets going into 2003.

In
September 2002, the Operating Partnership announced a 1.6 percent increase in its quarterly common unit distribution, commencing with the Operating Partnership's
distribution with respect to the third quarter of 2002, from $0.62 per common unit ($2.48 per common unit on an annualized basis) to $0.63 per common unit ($2.52 per common unit on an annualized
basis). With respect to the fourth quarter of 2002, the Operating Partnership declared a cash distribution of $0.63 per unit on December 19, 2002 to unitholders of record as of
January 6, 2003. The distributions were paid on January 17, 2003. The Operating Partnership has increased its quarterly common unit distribution for eight consecutive years representing
an increase of 56.0 percent over the period.

In
2002, the Operating Partnership:



Additionally, in 2002, the Operating Partnership, through unconsolidated joint ventures, commenced initial operations of a 577,575 square foot office property and a
350-room hotel for a total investment cost of approximately $141.4 million and sold a 183,200 square foot, three-building office complex for approximately $31.7 million. See
Note 4 to the Financial Statements for further information regarding joint venture activity.

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Operating Property Acquisitions

The Operating Partnership acquired the following operating properties during the year ended December 31, 2002:

|Acquisition
Date                    |  | Property/Address           |  | Location                               |  | # of
Bldgs. |         | Rentable
Square Feet |  | Investment by
Company(a)(in thousands)
|----------------------------------- |  | -------------------------- |  | -------------------------------------- |  | ----------- | ------- | -------------------- |  | --------------------------------------
|Office:                             |  |                            |  |                                        |  |             |         |                      |  |                                       
|08/09/02                            |  | 25 Commerce Drive          |  | Cranford, Union County, NJ             |  | 1           |         | 67,749               |  | $                                     
|08/09/02                            |  | 3 Skyline Drive(b)         |  | Hawthorne, Westchester County, NY      |  | 1           |         | 75,668               |  |                                       
|11/01/02                            |  | 1633 Littleton Road(c)     |  | Parsippany, Morris County, NJ          |  | 1           |         | 57,722               |  |                                       
|11/05/02                            |  | 1266 East Main Street      |  | Stamford, Fairfield County, CT         |  | 1           |         | 179,260              |  |                                       
|12/11/02                            |  | 2200 Renaissance Boulevard |  | King of Prussia, Montgomery County, PA |  | 1           |         | 174,124              |  |                                       
|12/31/02                            |  | 16 & 18 Sentry Park West   |  | Blue Bell, Montgomery County, PA       |  | 2           |         | 188,103              |  |                                       
|                                    |  |                            |  |                                        |  |             |         |                      |  |                                       
|Total Office Property Acquisitions: |  | 7                          |  | 742,626                                |  | $           | 123,470
|                                    |  |                            |  |                                        |  |             |         |                      |  |                                       

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Land Acquisitions

On June 12, 2002, the Operating Partnership acquired three land parcels located in Hawthorne and Yonkers, Westchester County, New York in one transaction
for a total cost of approximately $2,600. The land was acquired from an entity whose principals include Timothy M. Jones, Robert F. Weinberg and Martin S. Berger, each of whom are affiliated with the
Operating Partnership as the President of the Corporation, a current member of the Board of Directors and a former member of the Board of Directors of the Corporation, respectively. In connection with
the Operating Partnership's acquisition of 65 Class A properties from The Robert Martin Company ("Robert Martin") on January 31, 1997, as subsequently modified, the Operating Partnership
granted Robert Martin the right to designate one seat on the Corporation's Board of Directors ("RM Board Seat"), which right has since expired. Robert Martin designated Martin S. Berger and Robert F.
Weinberg to jointly share the RM Board Seat, as follows: Mr. Weinberg served as a member of the Board of Directors of the Corporation from 1997 until December 1, 1998, at which time
Mr. Weinberg resigned and Mr. Berger was appointed to serve in such capacity. Mr. Berger served as a member of the Board of Directors of the Corporation from December 1,
1998 until March 6, 2001, at which time Mr. Berger resigned and Mr. Weinberg was appointed to serve in such capacity until the Corporation's 2003 annual meeting of stockholders.
If the Corporation elects to nominate for re-election to its Board of Directors a designee of Robert Martin at the Corporation's 2003 annual meeting of stockholders, then Mr. Berger
and Mr. Weinberg have agreed that Mr. Berger will be so nominated and the seat will be rotated among Mr. Berger and Mr. Weinberg every 12 months commencing on the
12 month anniversary of the 2003 annual meeting of stockholders. Upon the death of Mr. Berger or Mr. Weinberg, the surviving person shall solely fill the remainder of the term of
the RM Board Seat.

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Properties Commencing Initial Operations

The following properties commenced initial operations during the year ended December 31, 2002:

|Acquisition
Date                                       |  | Property/Address    |  | Location                             |  | # of
Bldgs. |         | Rentable
Square Feet |         | Investment by
Operating
Partnership(a)(in thousands) |        
|------------------------------------------------------ |  | ------------------- |  | ------------------------------------ |  | ----------- | ------- | -------------------- | ------- | ---------------------------------------------------- | -------
|Office:                                                |  |                     |  |                                      |  |             |         |                      |         |                                                      |        
|09/03/02                                               |  | Harborside Plaza 5  |  | Jersey City, Hudson County, NJ       |  | 1           |         | 980,000              |         | $                                                    | 196,610
|11/18/02                                               |  | 600 Horizon Drive   |  | Hamilton Township, Mercer County, NJ |  | 1           |         | 95,000               |         |                                                      | 7,549  
|                                                       |  |                     |  |                                      |  |             |         |                      |         |                                                      |        
|Total Office Properties Commencing Initial Operations: |  | 2                   |  | 1,075,000                            |  | $           | 204,159 |                     
|                                                       |  |                     |  |                                      |  |             |         |                      |         |                                                      |        
|Office/Flex:                                           |  |                     |  |                                      |  |             |         |                      |         |                                                     
|04/01/02                                               |  | 125 Clearbrook Road |  | Elmsford, Westchester County, NY     |  | 1           |         | 33,000               |         |                                                      | 4,985  
|                                                       |  |                     |  |                                      |  |             |         |                      |         |                                                      |        
|Total Properties Commencing Initial Operations:        |  |                     |  | 3                                    |  | 1,108,000   |         | $                    | 209,144 |                                                     
|                                                       |  |                     |  |                                      |  |             |         |                      |         |                                                      |        

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Property Sales

The Operating Partnership sold the following properties during the year ended December 31, 2002:

|Sale
Date                    |  | Property/Address           |  | Location                             |  | # of
Bldgs. |         | Rentable
Square Feet |   | Net Sales
Proceeds(in thousands) |        | Net Book
Value(in thousands) |       | Realized
Gain/(Loss)(in thousands) | 
|---------------------------- |  | -------------------------- |  | ------------------------------------ |  | ----------- | ------- | -------------------- | - | -------------------------------- | ------ | ---------------------------- | ----- | ---------------------------------- | 
|Office:                      |  |                            |  |                                      |  |             |         |                      |   |                                  |        |                              |       |                                    | 
|05/13/02                     |  | Dallas Portfolio (a)       |  | Metro Dallas, TX                     |  | 4           |         | 488,789              |   | $                                | 33,115 |                              | $     | 34,760                             | 
|05/29/02                     |  | 750 South Richfield Street |  | Aurora, Arapahoe County, CO          |  | 1           |         | 108,240              |   |                                  | 20,631 |                              |       | 21,291                             | 
|06/06/02                     |  | Houston Portfolio (b)      |  | Houston, Harris County, TX           |  | 3           |         | 413,107              |   |                                  | 25,482 |                              |       | 24,393                             | 
|07/15/02                     |  | 501 Kennedy Boulevard      |  | Tampa, Hillsborough County, FL       |  | 1           |         | 297,429              |   |                                  | 22,915 |                              |       | 22,459                             | 
|10/16/02                     |  | Arizona Portfolio (c)      |  | Maricopa County, AZ                  |  | 3           |         | 416,967              |   |                                  | 42,764 |                              |       | 42,719                             | 
|                             |  |                            |  |                                      |  |             |         |                      |   |                                  |        |                              |       |                                    | 
|Total Office Property Sales: |  | 12                         |  | 1,724,532                            |  | $           | 144,907 |                      | $ | 145,622                          |        | $                            | (715  | )                                 
|                             |  |                            |  |                                      |  |             |         |                      |   |                                  |        |                              |       |                                    | 
|Residential:                 |  |                            |  |                                      |  |             |         |                      |   |                                  |        |                              |       |                                    | 
|01/30/02                     |  | 25 Martine Avenue          |  | White Plains, Westchester County, NY |  | 1           |         | 124 units            |   |                                  | 17,559 |                              |       | 10,461                             | 
|Other:                       |  |                            |  |                                      |  |             |         |                      |   |                                  |        |                              |       |                                    | 
|04/25/02                     |  | Horizon Center Land        |  | Hamilton Township, Mercer County, NJ |  |            |         | 0.756 acres          |   |                                  | 758    |                              |       | 41                                 | 
|                             |  |                            |  |                                      |  |             |         |                      |   |                                  |        |                              |       |                                    | 
|Total Property Sales:        |  | 13                         |  | 1,724,532                            |  | $           | 163,224 |                      | $ | 156,124                          |        | $                            | 7,100 |                                   
|                             |  |                            |  |                                      |  |             |         |                      |   |                                  |        |                              |       |                                    | 

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Development

On February 12, 2003, the Meadowlands Xanadu proposal, presented by a joint venture to be formed among The Mills Corporation, the Corporation and The New
York Giants, was selected by the New Jersey Sports and Exposition Authority, providing them with the exclusive right to negotiate a developer's agreement for the development of a $1.3 billion
family entertainment and recreation complex with an office and hotel component at the Continental Airlines Arena site in East Rutherford, New Jersey. Meadowlands Xanadu's
4.76-million-square-foot complex is expected to feature a family entertainment destination comprising three themed zones: sports/recreation, kids' activities and fashion. The
project is expected to also include office and hotel space totaling 2.2 million square feet, consisting of four 14-story, 440,000 square-foot office buildings and a
520-room hotel with conference and exhibition facilities. No definitive documentation has been entered into between The Mills Corporation and the Corporation with respect to the Xanadu
Project. However, it is the current understanding between Mills and the Corporation that the retail component will be shared 80 percent to Mills and 20 percent to the Corporation and the
office and hotel components will be shared 80 percent to the Corporation and 20 percent to Mills, subject to any arrangements with third parties such as The New York Giants. There can be
no assurance that these will be the final economic arrangements.

FINANCING ACTIVITY

Exchange of Senior Unsecured Notes

On December 20, 2002, the Operating Partnership exchanged $90.0 million face amount of existing 7.18 percent senior unsecured notes due
December 31, 2003, with interest payable monthly in arrears, for $94.9 million face amount of 6.15 percent senior unsecured notes due December 15, 2012, with interest
payable semi-annually in arrears. The exchange was completed with Teachers Insurance and Annuity Association ("TIAA").

Revolving Credit Facility

On September 27, 2002, the Operating Partnership obtained an unsecured revolving credit facility ("2002 Unsecured Facility") with a current borrowing
capacity of $600.0 million from a group of 14 lenders. The interest rate on outstanding borrowings under the credit line is currently the London Inter-Bank Offered Rate ("LIBOR")
plus 70 basis points. The Operating Partnership may instead elect an interest rate representing the higher of the lender's prime rate or the Federal Funds rate plus 50 basis points. The 2002 Unsecured
Facility also requires a 20 basis point facility fee on the current borrowing capacity payable quarterly in arrears. In the event of a change in the Operating Partnership's unsecured debt rating, the
interest rate and facility fee will be changed on a sliding scale. Subject to certain conditions, the Operating Partnership has the ability to increase the borrowing capacity of the credit line up to
$800.0 million. The 2002 Unsecured Facility matures in September 2005, with an extension option of one year, which would require upon exercise a payment of 25 basis points of the then
borrowing capacity of the credit line.

Mortgage Financing

On December 16, 2002, the Operating Partnership obtained $19.5 million in proceeds from TIAA through a mortgage loan secured by Soundview Plaza, an
office property located in Stamford, Fairfield

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County, Connecticut. The mortgage bears interest at an effective interest rate of 6.02 percent per annum and matures in January 2013. Proceeds from the financing were used to pay down
outstanding borrowings on the Operating Partnership's revolving credit facility.

On
December 30, 2002, the Operating Partnership obtained $19.1 million in proceeds from TIAA through a mortgage loan secured by 2200 Renaissance Boulevard, an office
property located in King of Prussia, Montgomery County, Pennsylvania. The mortgage bears interest at an effective interest rate of 5.89 percent per annum and matures in December 2012.
Proceeds from the financing were used to pay down outstanding borrowings on the Operating Partnership's revolving credit facility.

Interest Rate Contract

In November 2002, the Operating Partnership paid $1.9 million in settlement of a forward treasury rate lock agreement entered into in
July 2002, which is being amortized to interest expense over a three-year period. The agreement was used to fix the index rate on $61.5 million of the Operating Partnership's
Harborside Financial CenterPlaza 1 mortgage, for which the interest rate was re-set to the three-year U.S. Treasury Note plus 130 basis points for the three year
period beginning November 4, 2002.

Stock Repurchases

On September 13, 2000, the Board of Directors of the Corporation authorized an increase to the Corporation's repurchase program under which the Corporation
was permitted to purchase up to an additional $150.0 million of the Corporation's outstanding common stock ("Repurchase Program"). From that date through February 14, 2003, the
Corporation purchased for constructive retirement under the Repurchase Program 3.7 million shares of its outstanding common stock for an aggregate cost of approximately $104.5 million,
of which 0.4 million shares were repurchased in 2002 for a total cost of $12.6 million. Concurrent with these purchases, the Corporation sold to the Operating Partnership
3.7 million common units at an aggregate cost of approximately $104.5 million. As of February 14, 2003, the Corporation has a remaining authorization to repurchase up to an
additional $45.5 million of its outstanding common stock, which it may repurchase from time to time in open market transactions at prevailing prices or through privately negotiated
transactions.

RISK FACTORS

Our results from operations and ability to make distributions on our equity and debt service on our indebtedness may be affected by the risk factors set forth
below. All investors should consider the following risk factors before deciding to purchase securities of the Operating Partnership. The Operating Partnership refers to itself as "we" or "our" in the
following risk factors.

Declines in economic activities in the Northeastern office markets could adversely affect our operating results.

A
majority of our revenues are derived from our properties located in the Northeast, particularly in New Jersey, New York, Pennsylvania and Connecticut. Adverse economic developments in
this region could adversely impact the operations of our properties and, therefore, our profitability. Because our portfolio consists primarily of office and office/flex buildings (as compared to a
more diversified real estate portfolio), a decline in the economy and/or a decline in the demand for office space may adversely affect our ability to make distributions or payments to our investors.

The
current economic downturn has resulted in a receding real estate market, the relocation of companies and an uncertain economic future for many businesses. We are uncertain how long
the current downturn will last. The current economic downturn may also be having a negative economic impact on many industries, including securities, insurance services, telecommunications and
computer

11

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systems and other technology, businesses in which many of our tenants are involved. Such economic impact may cause our tenants to have difficulty or be unable to meet their obligations to us.

Our performance is subject to risks associated with the real estate industry.

General:Our ability to make distributions or payments to our investors depends on the ability of our properties to generate
funds in excess of operating expenses (including scheduled principal payments on debt and capital expenditure requirements). Events or conditions that are beyond our control may adversely affect our
operations and the value of our properties. Such events or conditions could include:



Financially distressed tenants may be unable to pay rent:If a tenant defaults, we may experience delays and incur
substantial costs in enforcing our rights as landlord and protecting our investments. If a tenant files for bankruptcy, a potential court judgment rejecting and terminating such tenant's lease could
adversely affect our ability to make distributions or payments to our investors.

Our insurance coverage on our properties may be inadequate:We currently carry comprehensive insurance on all of our
properties, including insurance for liability, fire and flood. We cannot guarantee that the limits of our current policies will be sufficient in the event of a catastrophe to our properties. Our
existing insurance policies expire in April and September 2003. We cannot guarantee that we will be able to renew or duplicate our current insurance coverage in adequate amounts or at
reasonable prices. In addition, while our current insurance policies insure us against loss from terrorist acts and toxic mold, in the future insurance companies may no longer offer coverage against
these types of losses, or, if offered, these types of insurance may be prohibitively expensive. If any or all of the foregoing should occur, we may not have insurance coverage against certain types of
losses and/or there may be decreases in the limits of insurance available. Should an uninsured loss or a loss in excess of our insured limits occur, we could lose all or a portion of the capital we
have invested in a property or properties, as well as the anticipated future revenue from the property or properties. Nevertheless, we might remain obligated for any mortgage debt or other financial
obligations related to the property or properties. We cannot guarantee that material losses in excess of insurance proceeds will not occur in the future. If any of our properties were to experience a
catastrophic loss, it could seriously disrupt our

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operations, delay revenue and result in large expenses to repair or rebuild the property. Such events could adversely affect our ability to make distributions or payments to our investors.

Illiquidity of real estate limits our ability to act quickly:Real estate investments are relatively illiquid. Such
illiquidity may limit our ability to react quickly in response to changes in economic and other conditions. If we want to sell an investment, we might not be able to dispose of that investment in the
time period we desire, and the sales price of that investment might not recoup or exceed the amount of our investment. The prohibition in the Internal Revenue Code of 1986, as amended, and related
regulations on a real estate investment trust holding property for sale also may restrict our ability to sell property. In addition, we acquired a significant number of our properties from individuals
to whom we issued limited partnership units as part of the purchase price. In connection with the acquisition of these properties, in order to preserve such individual's tax deferral, we contractually
agreed not to sell or otherwise transfer the properties for a specified period of time, except in a manner which does not result in recognition of any built-in-gain (which may
result in an income tax liability) or which reimburses the appropriate individuals for the tax consequences of the recognition of such built-in-gains. As of December 31,
2002, 141 of our properties, with an aggregate net book value of approximately $1.8 billion, were subject to these restrictions, which expire periodically through 2008. The above
limitations on our ability to sell our investments could adversely affect our ability to make distributions or payments to our investors.

Americans with Disabilities Act compliance could be costly:Under the Americans with Disabilities Act of 1990 ("ADA"), all
public accommodations and commercial facilities must meet certain federal requirements related to access and use by disabled persons. Compliance with the ADA requirements could involve removal of
structural barriers from certain disabled persons' entrances. Other federal, state and local laws may require modifications to or restrict further renovations of our properties with respect to such
accesses. Although we believe that our properties are substantially in compliance with present requirements, noncompliance with the ADA or related laws or regulations could result in the United States
government imposing fines or private litigants being awarded damages against us. Such costs may adversely affect our ability to make distributions or payments to our investors.

Environmental problems are possible and may be costly:Various federal, state and local laws and regulations subject property
owners or operators to liability for the costs of removal or remediation of certain hazardous or toxic substances located on or in the property. These laws often impose liability without regard to
whether the owner or operator was responsible for or even knew of the presence of such substances. The presence of or failure to properly remediate hazardous or toxic substances (such as toxic mold)
may adversely affect our ability to rent, sell or borrow against contaminated property. Various laws and regulations also impose liability on persons who arrange for the disposal or treatment of
hazardous or toxic substances at another location for the costs of removal or remediation of such substances at the disposal or treatment facility. These laws often impose liability whether or not the
person arranging for such disposal ever owned or operated the disposal facility. Certain other environmental laws and regulations impose liability on owners or operators of property for injuries
relating to the release of asbestos-containing materials into the air. As owners and operators of property and as potential arrangers for hazardous substance disposal, we may be liable under such laws
and regulations for removal or remediation costs, governmental penalties, property damage, personal injuries and related expenses. Payment of such costs and expenses could adversely affect our ability
to make distributions or payments to our investors.

Competition for acquisitions may result in increased prices for properties:We plan to acquire additional properties in New
Jersey, New York and Pennsylvania and in the Northeast generally. We may be competing for investment opportunities with entities that have greater financial resources. Several office building
developers and real estate companies may compete with us in seeking properties

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for acquisition, land for development and prospective tenants. Such competition may adversely affect our ability to make distributions or payments to our investors by:



Development of real estate could be costly:As part of our operating strategy, we may acquire land for development or
construct on owned land, under certain conditions. Included among the risks of the real estate development business are the following, which may adversely affect our ability to make distributions or
payments to our investors:



Property ownership through joint ventures could subject us to the contrary business objectives of our
co-venturers:    We, from time to time, invest in joint ventures or partnerships in which we do not hold a controlling interest. These investments involve
risks that do not exist with properties in which we own a controlling interest, including the possibility that our co-venturers or partners may, at any time, have business, economic or
other objectives that are inconsistent with our objectives. Because we lack a controlling interest, our co-venturers or partners may be in a position to take action contrary to our
instructions or requests or contrary to our policies or objectives. While we seek protective rights against such company action, there can be no assurance that we will be successful in procuring any
such protective rights, or if procured, that the rights will be sufficient to fully protect us against contrary actions. Our organizational documents do not limit the amount of available funds that we
may invest in joint ventures or partnerships. If the objectives of our co-venturers or partners are inconsistent with ours, it may adversely affect our ability to make distributions or
payments to our investors.

Debt financing could adversely affect our economic performance.

Scheduled debt payments and refinancing could adversely affect our financial condition:We are
subject to the risks normally associated with debt financing. These risks, including the following, may adversely affect our ability to make distributions or payments to our investors:



As
of December 31, 2002, we had total outstanding indebtedness of $1.8 billion comprised of $1.1 billion of senior unsecured notes, outstanding borrowings of
$73.0 million under our unsecured $600.0 million revolving credit facility and approximately $582.0 million of mortgage indebtedness. We

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may have to refinance the principal due on our current or future indebtedness at maturity, and we may not be able to do so.

If
we are unable to refinance our indebtedness on acceptable terms, or at all, events or conditions that may adversely affect our ability to make distributions or payments to our
investors include the following:



We are obligated to comply with financial covenants in our indebtedness that could restrict our range of operating
activities:    The mortgages on our properties contain customary negative covenants, including limitations on our ability, without the prior consent of the lender, to
further mortgage the property, to enter into new leases outside of stipulated guidelines or to materially modify existing leases. In addition, our credit facility contains customary requirements,
including restrictions and other limitations on our ability to incur debt, debt to assets ratios, secured debt to total assets ratios, debt service coverage ratios and minimum ratios of unencumbered
assets to unsecured debt. The indentures under which our senior unsecured debt have been issued contain financial and operating covenants including coverage ratios and limitations on our ability to
incur secured and unsecured debt. These covenants limit our flexibility in conducting our operations and create a risk of default on our indebtedness if we cannot continue to satisfy them.

Rising interest rates may adversely affect our cash flow:As of December 31, 2002, outstanding borrowings of
approximately $73.0 million under our revolving credit facility and approximately $32.2 million of our mortgage indebtedness bear interest at variable rates. We may incur additional
indebtedness in the future that also bears interest at variable rates. Variable rate debt creates higher debt service requirements if market interest rates increase. Higher debt service requirements
could adversely affect our ability to make distributions or payments to our investors and/or cause us to default under certain debt covenants.

Our degree of leverage could adversely affect our cash flow:We fund acquisition opportunities and development partially
through short-term borrowings (including our revolving credit facility), as well as from proceeds from property sales and undistributed cash. We expect to refinance projects purchased with
short-term debt either with long-term indebtedness or equity financing depending upon the economic conditions at the time of refinancing. The Board of Directors of
Mack-Cali Realty Corporation, our general partner, has a general policy of limiting the ratio of our indebtedness to total undepreciated assets (total debt as a percentage of total
undepreciated assets) to 50 percent or less, although there is no limit in Mack-Cali Realty Corporation's or our organizational documents on the amount of indebtedness that we may
incur. However, we have entered into certain financial agreements which contain financial and operating covenants that limit our ability under certain circumstances to incur additional secured and
unsecured indebtedness. The Board of Directors could alter or eliminate its current policy on borrowing at any time at its discretion. If this policy were changed, we could become more highly
leveraged, resulting in an increase in debt service that could adversely affect our cash flow and our ability to make distributions or payments to our investors and/or could cause an increased risk of
default on our obligations.

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We are dependent on external sources of capital for future growth:To qualify as a real estate investment trust,
Mack-Cali Realty Corporation must distribute to its shareholders each year at least 90 percent of its net taxable income, excluding any net capital gain. Because of this
distribution requirement, it is not likely that we will be able to fund all future capital needs, including for acquisitions and developments, from income from operations. Therefore, we will have to
rely on third-party sources of capital, which may or may not be available on favorable terms or at all. Our access to third-party sources of capital depends on a number of things, including the
market's perception of our growth potential and our current and potential future earnings. Moreover, additional equity offerings may result in substantial dilution of our shareholders' interests, and
additional debt financing may substantially increase our leverage.

Competition for skilled personnel could increase our labor costs.

We compete with various other companies in attracting and retaining qualified and skilled personnel. We depend on our ability to attract and retain skilled
management personnel who are responsible for our day-to-day operations. Competitive pressures may require that we enhance our pay and benefits package to compete effectively
for such personnel. We may not be able to offset such added costs by increasing the rates we charge our tenants. If there is an increase in these costs or if we fail to attract and retain qualified
and skilled personnel, our business and operating results could be harmed.

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We are dependent on our key personnel whose continued service is not guaranteed.

We
are dependent upon the executive officers of Mack-Cali Realty Corporation for strategic business direction and real estate experience. While we believe that we could find
replacements for these key personnel, loss of their services could adversely affect our operations. Mack-Cali Realty Corporation has entered into an employment agreement (including
non-competition provisions) which provides for a continuous four-year employment term with each of Mitchell E. Hersh, Timothy M. Jones, Barry Lefkowitz and Roger W. Thomas. We
also entered into an employment agreement (including non-competition provisions) with Michael A. Grossman in December 2000 which provides for a continuous one-year term
from and after the two-year anniversary of the execution of the agreement. Mack-Cali Realty Corporation does not have key man life insurance for its executive officers.

Certain provisions of Maryland law and the charter, bylaws and stockholder rights plan of Mack-Cali Realty Corporation could hinder, delay or prevent changes in
control.

Certain
provisions of Maryland law, the charter, bylaws, and stockholder rights plan of Mack-Cali Realty Corporation have the effect of discouraging, delaying or preventing transactions
that involve an actual or threatened change in control. These provisions include the following:

Classified Board of Directors:The Board of Directors is divided into three classes with staggered terms of office of three
years each. The classification and staggered terms of office of the directors make it more difficult for a third party to gain control of the board of directors. At least two annual meetings of
stockholders, instead of one, generally would be required to affect a change in a majority of the board of directors.

Removal of Directors:Under the Corporation's charter, subject to the rights of one or more classes or series of preferred
stock to elect one or more directors, a director may be removed only for cause and only by the affirmative vote of at least two-thirds of all votes entitled to be cast by the Corporation's
stockholders generally in the election of directors.

Number of Directors, Board Vacancies, Term of Office:The Corporation has, in its bylaws, elected to be subject to certain
provisions of Maryland law which vest in the Board of Directors the exclusive right to
determine the number of directors and the exclusive right, by the affirmative vote of a majority of the remaining directors, even if the remaining directors do not constitute a quorum, to fill
vacancies on the board. These provisions of Maryland law, which are applicable even if other provisions of Maryland law or the charter or bylaws provide to the contrary, also provide that any director
elected to fill a vacancy shall hold office for the remainder of the full term of the class of directors in which the vacancy occurred, rather than the next annual meeting of stockholders as would
otherwise be the case, and until his or her successor is elected and qualifies.

Stockholder Requested Special Meetings:The Corporation's bylaws provide that its stockholders have the right to call a
special meeting only upon the written request of the stockholders entitled to cast not less than a majority of all the votes entitled to be cast by the stockholders at such meeting.

Advance Notice Provisions for Stockholder Nominations and Proposals:The Corporation's bylaws require advance written notice
for stockholders to nominate persons for election as directors at, or to bring other business before, any meeting of stockholders. This bylaw provision limits the ability of stockholders to make
nominations of persons for election as directors or to introduce other proposals unless the Corporation is notified in a timely manner prior to the meeting.

Exclusive Authority of the Board to Amend the Bylaws:The Corporation's bylaws provide that its board of directors has the
exclusive power to adopt, alter or repeal any provision of the bylaws or to make new bylaws. Thus, the Corporation's stockholders may not effect any changes to its bylaws.

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Preferred Stock:Under the Corporation's charter, the Board of Directors has authority to issue preferred stock from time to
time in one or more series and to establish the terms, preferences and rights of any such series of preferred stock, all without approval of the Corporation's stockholders.

Duties of Directors with Respect to Unsolicited Takeovers:Maryland law provides protection for Maryland corporations against
unsolicited takeovers by limiting, among other things, the duties of the directors in unsolicited takeover situations. The duties of directors of Maryland corporations do not require them to
(a) accept, recommend or respond to any proposal by a person seeking to acquire control of the corporation, (b) authorize the corporation to redeem any rights under, or modify or render
inapplicable, any stockholders rights plan, (c) make a determination under the Maryland Business Combination Act or the Maryland Control Share Acquisition Act, or (d) act or fail to act
solely because of the effect of the act or failure to act may have on an acquisition or potential acquisition of control of the corporation or the amount or type of consideration that may be offered
or paid to the stockholders in an acquisition. Moreover, under Maryland law the act of directors of a Maryland corporation relating to or affecting an acquisition or potential acquisition of control
is not subject to any higher duty or greater scrutiny than is applied to any other act of a director. Maryland law also contains a statutory presumption that an act of a director of a Maryland
corporation satisfies the applicable standards of conduct for directors under Maryland law.

Ownership Limit:In order to preserve the Corporation's status as a real estate investment trust under the Code, the
Corporation's charter generally prohibits any single stockholder, or any group of affiliated stockholders, from beneficially owning more than 9.8 percent of its outstanding capital stock unless
the Board of Directors waives or modifies this ownership limit.

Maryland Business Combination Act:The Maryland Business Combination Act provides that unless exempted, a Maryland
corporation may not engage in business combinations, including mergers, dispositions of 10 percent or more of its assets, issuances of shares of stock and other specified transactions, with an
"interested stockholder" or an affiliate of an interested stockholder for five years after the most recent date on which the interested stockholder became an interested stockholder, and thereafter
unless specified criteria are met. An interested stockholder is generally a person owning or controlling, directly or indirectly, 10 percent or more of the voting power of the outstanding stock
of the Maryland corporation. The Board of Directors has exempted from this statute business combinations with certain affiliated individuals and entities. However, unless the Board of Directors adopts
other exemptions, the provisions of the Maryland Business Combination Act will be applicable to business combinations with other persons.

Maryland Control Share Acquisition Act:Maryland law provides that "control shares" of a corporation acquired in a "control
share acquisition" shall have no voting rights except to the extent approved by a vote of two-thirds of the vote eligible to cast on the matter under the Maryland Control Share Acquisition
Act. "Control Shares" means shares of stock that, if aggregated with all other shares of stock previously acquired by the acquirer, would entitle the acquirer to exercise voting power in electing
directors within one of the following ranges of the voting power: one-tenth or more but less than one-third, one-third or more but less than a majority or a
majority or more of all voting power. A "control share acquisition" means the acquisition of control shares, subject to certain exceptions.

If
voting rights or control shares acquired in a control share acquisition are not approved at a stockholder's meeting, then subject to certain conditions and limitations, the issuer may
redeem any or all of the control shares for fair value. If voting rights of such control shares are approved at a stockholder's meeting and the acquirer becomes entitled to vote a majority of the
shares of stock entitled to vote, all other stockholders may exercise appraisal rights. The Corporation's bylaws contain a provision exempting from the Maryland Control Share Acquisition Act any
acquisitions of shares by certain affiliated individuals and entities, any directors, officers or employees of the Corporation and any person approved by the Board of Directors prior to the
acquisition by such person of control

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shares. Any control shares acquired in a control share acquisition which are not exempt under the foregoing provisions of the Corporation's bylaws will be subject to the Maryland Control Share
Acquisition Act.

Stockholder Rights Plan:The Corporation has adopted a stockholder rights plan that may discourage any potential acquirer
from acquiring more than 15 percent of the Corporation's outstanding common stock since, upon this type of acquisition without approval of the Board of Directors, all other common
stockholders will have the right to purchase a specified amount of common stock at a substantial discount from market price.

Consequences of failure of Mack-Cali Realty Corporation to qualify as a real estate investment trust could adversely affect our financial condition.

Failure to maintain ownership limits could cause Mack-Cali Realty Corporation to lose its qualification as a real estate
investment trust:    In order for Mack-Cali Realty Corporation to maintain its qualification as a real estate investment trust, not more than
50 percent in value of its outstanding stock may be actually and/or constructively owned by five or fewer individuals (as defined in the Internal Revenue Code to include certain entities).
Mack-Cali Realty Corporation has limited the ownership of its outstanding shares of its common stock by any single stockholder to 9.8 percent of the outstanding shares of its common
stock. The Board of Directors of Mack-Cali Realty Corporation could waive this restriction if they were satisfied, based upon the advice of tax counsel or otherwise, that such action would
be in the best interests of Mack-Cali Realty Corporation and would not affect its qualifications as a real estate investment trust. Common stock of Mack-Cali Realty Corporation
acquired or transferred in breach of the limitation may be redeemed by Mack-Cali Realty Corporation for the lesser of the price paid and the average closing price for the 10 trading days
immediately preceding redemption or sold at the direction of us. Mack-Cali Realty Corporation may elect to redeem such shares of common stock for limited partnership units, which are
nontransferable except in very limited circumstances. Any transfer of shares of common stock which, as a result of such transfer, causes Mack-Cali Realty Corporation to be in violation of
any ownership limit will be deemed void. Although Mack-Cali Realty Corporation currently intends to continue to operate in a manner which will enable it to continue to qualify as a real
estate investment trust, it is possible that future economic, market, legal, tax or other considerations may cause Mack-Cali Realty Corporation's Board of Directors to revoke the election
for Mack-Cali Realty Corporation to qualify as a real estate investment trust (see for example, the discussion below of President George W. Bush's proposed legislation to exempt corporate
dividends from income taxation). Under Mack-Cali Realty Corporation's organizational documents, its Board of Directors can make such revocation without the consent of Mack-Cali
Realty Corporation's stockholders.

In
addition, the consent of the holders of at least 85 percent of our partnership units is required: (i) to merge (or permit the merger of) us with another unrelated
person, pursuant to a transaction in which we are not the surviving entity; (ii) to dissolve, liquidate or wind up; or (iii) to convey or otherwise transfer all or substantially all of
our assets. Mack-Cali Realty Corporation, as general partner, owns approximately 80.3 percent of our outstanding partnership units (assuming conversion of all preferred limited
partnership units).

Tax liabilities as a consequence of failure of Mack-Cali Realty Corporation to qualify as a real estate investment trust:
Mack-Cali Realty Corporation has elected to be treated and has operated so as to qualify as a real estate investment trust for federal income tax purposes since its taxable year ended
December 31, 1994. Although Mack-Cali Realty Corporation believes it will continue to operate in such manner, it cannot guarantee that it will do so. Qualification as a real estate
investment trust involves the satisfaction of various requirements (some on an annual and some on a quarterly basis) established under highly technical and complex tax provisions of the Internal
Revenue Code. Because few judicial or administrative interpretations of such provisions exist and qualification determinations are fact

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sensitive, we cannot assure you that Mack-Cali Realty Corporation will qualify as a real estate investment trust for any taxable year.

If
Mack-Cali Realty Corporation fails to qualify as a real estate investment trust in any taxable year, it will be subject to the following:



A
loss of Mack-Cali Realty Corporation's status as a real estate investment trust could have an adverse effect on us. Failure to qualify as a real estate investment trust
also would eliminate the requirement that Mack-Cali Realty Corporation pay dividends to its stockholders.

Other tax liabilities:Even if Mack-Cali Realty Corporation qualifies as a real estate investment trust, it is
subject to certain federal, state and local taxes on our income and property and, in some circumstances, certain other state and local taxes. Our net income from third party management and tenant
improvements, if any, also may be subject to federal income tax.

Risk of changes in the tax law applicable to real estate investment trusts:Since the Internal Revenue Service, the United
States Treasury Department and Congress frequently review federal income tax legislation, we cannot predict whether, when or to what extent new federal tax laws, regulations, interpretations or
rulings will be adopted. Any of such legislative action may prospectively or retroactively modify our and Mack-Cali Realty Corporation's tax treatment and, therefore, may adversely affect
taxation of us, Mack-Cali Realty Corporation, and/or our investors.

Recently,
President Bush proposed legislation that would exempt from income taxation those dividends that shareholders receive that are out of earnings that have been subject to
corporate-level taxation. Since the earnings of real estate investment trusts generally are not subject to corporate-level taxation (by reason of the dividends-paid deduction to which real
estate investment trusts are entitled), the
President's proposed dividend exemption would generally not apply to real estate investment trust dividends. Enactment of the President's proposed legislation may cause the Board of Directors of
Mack-Cali Realty Corporation to determine to revoke the election for it to qualify as a real estate investment trust.

AVAILABLE INFORMATION

The Corporation's internet website is www.mack-cali.com. The Operating Partnership makes available free of charge through the Corporation's website
its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished
pursuant to Section 13(a) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after it electronically files or furnishes such materials to the Securities and
Exchange Commission.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

The Operating Partnership considers portions of this information to be forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934. The Operating Partnership intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of
the Exchange Act. Such forward-looking statements relate to, without limitation, the Operating Partnership's future economic performance, plans and

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objectives for future operations and projections of revenue and other financial items. Forward-looking statements can be identified by the use of words such as "may," "will," "should," "expect,"
"anticipate," "estimate," "continue" or comparable terminology. Forward-looking statements are inherently subject to risks and uncertainties, many of which the Operating Partnership cannot predict
with accuracy and some of which the Operating Partnership might not even anticipate. Although the Operating Partnership believes that the expectations reflected in such forward-looking statements are
based upon reasonable assumptions at the time made, it can give no assurance that its expectations will be achieved. Future events and actual results, financial and otherwise, may differ materially
from the results discussed in the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements. Among the factors about which the Operating
Partnership has made assumptions are changes in the general economic climate; conditions, including those affecting industries in which the Operating Partnership's principal tenants compete; any
failure of the general economy to recover from the current economic downturn; the extent of any tenant bankruptcies; the Operating Partnership's ability to lease or re-lease space at
current or anticipated rents; changes in the supply of and demand for office, office/flex and industrial/warehouse properties; changes in interest rate levels; changes in operating costs; the
Operating Partnership's ability to obtain adequate insurance, including coverage for terrorist acts; the availability of financing; and other risks associated with the development and acquisition of
properties, including risks that the development may not be completed on schedule, that the tenants will not take occupancy or pay rent, or that development or operating costs may be greater than
anticipated. For further information on factors which could impact the Operating Partnership and the statements contained herein, see the "Risk Factors" section. The Operating Partnership assumes no
obligation to update and supplement forward-looking statements that become untrue because of subsequent events.

ITEM 2. PROPERTIES

PROPERTY LIST

As of December 31, 2002, the Operating Partnership's Consolidated Properties consisted of 251 in-service office, office/flex and
industrial/warehouse properties, as well as two stand-alone retail properties and three land leases. The Consolidated Properties are located primarily in the Northeast. The Consolidated Properties are
easily accessible from major thoroughfares and are in close proximity to numerous amenities. The Consolidated Properties contain a total of approximately 27.1 million square feet, with the
individual properties ranging from approximately 6,200 to 980,000 square feet. The Consolidated Properties, managed by on-site employees, generally have attractively landscaped sites,
atriums and covered parking in addition to quality design and construction. The Operating Partnership's tenants include many service sector employers, including a large number of professional firms
and national and international businesses. The Operating Partnership believes that all of its properties are well-maintained and do not require significant capital improvements.

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Property Listing

Office Properties

|Property
Location           |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                    
|--------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------
|ATLANTIC COUNTY, NEW JERSEY |  |            |  |                             |  |                                         |  |                               |  |                                   
|Egg Harbor                  |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                    
|100 Decadon Drive           |  | 1987       |  | 40,422                      |  | 100.0                                   |  | 951                           |  | 889                                |  | 0.19                                                                                 |  | 23.53                                        |  | 21.99                                             |  | Computer Sciences Corp. (100%)                                                                                     
|200 Decadon Drive           |  | 1991       |  | 39,922                      |  | 100.0                                   |  | 798                           |  | 779                                |  | 0.16                                                                                 |  | 19.99                                        |  | 19.51                                             |  | Computer Sciences Corp. (100%)                                                                                     
|BERGEN COUNTY, NEW JERSEY   |  |            |  |                             |  |                                         |  |                               |  |                                   
|Fair Lawn                   |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                    
|17-17 Route 208 North       |  | 1987       |  | 143,000                     |  | 97.8                                    |  | 3,543                         |  | 3,337                              |  | 0.72                                                                                 |  | 25.33                                        |  | 23.86                                             |  | Lonza, Inc. (63%)                                                                                                  
|Fort Lee                    |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                    
|One Bridge Plaza            |  | 1981       |  | 200,000                     |  | 97.7                                    |  | 4,924                         |  | 4,599                              |  | 1.00                                                                                 |  | 25.20                                        |  | 23.54                                             |  | Mellon HR Solutions, LLC (35%), Broadview Associates, LLP (16%), FCB Worldwide, Inc. (16%)                         
|2115 Linwood Avenue         |  | 1981       |  | 68,000                      |  | 99.7                                    |  | 1,711                         |  | 1,320                              |  | 0.35                                                                                 |  | 25.24                                        |  | 19.47                                             |  | US Depot, Inc. (23%), Ameribrom, Inc. (14%), Mack Management & Construction (12%), Morgan Stanley Dean Witter (10%)
|Little Ferry                |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                    
|200 Riser Road              |  | 1974       |  | 286,628                     |  | 100.0                                   |  | 2,536                         |  | 2,464                              |  | 0.52                                                                                 |  | 8.85                                         |  | 8.60                                              |  | Ford Motor Company (34%), Casio, Inc. (33%), Dassault Falcon Jet Corp. (33%)                                       
|Montvale                    |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                    
|95 Chestnut Ridge Road      |  | 1975       |  | 47,700                      |  | 100.0                                   |  | 566                           |  | 502                                |  | 0.12                                                                                 |  | 11.87                                        |  | 10.52                                             |  | Aventis Environmental Science (100%)                                                                               
|135 Chestnut Ridge Road     |  | 1981       |  | 66,150                      |  | 100.0                                   |  | 1,560                         |  | 1,309                              |  | 0.32                                                                                 |  | 23.58                                        |  | 19.79                                             |  | Paychex, Inc. (45%), Automated Resources Group, Inc. (26%), Sys-Con Publications, Inc. (11%)                       
|Paramus                     |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                    
|15 East Midland Avenue      |  | 1988       |  | 259,823                     |  | 100.0                                   |  | 6,722                         |  | 6,720                              |  | 1.37                                                                                 |  | 25.87                                        |  | 25.86                                             |  | AT&T Wireless Services (100%)                                                                                      
|461 From Road               |  | 1988       |  | 253,554                     |  | 99.8                                    |  | 6,057                         |  | 6,050                              |  | 1.23                                                                                 |  | 23.94                                        |  | 23.91                                             |  | Toys "R' Us, Inc. (96%)                                                                                            
|650 From Road               |  | 1978       |  | 348,510                     |  | 92.9                                    |  | 7,749                         |  | 7,304                              |  | 1.58                                                                                 |  | 23.93                                        |  | 22.56                                             |  | Movado Group, Inc. (18%), Long Beach Acceptance Corp. (10%)                                                        
|140 Ridgewood Avenue        |  | 1981       |  | 239,680                     |  | 100.0                                   |  | 5,110                         |  | 4,890                              |  | 1.04                                                                                 |  | 21.32                                        |  | 20.40                                             |  | AT&T Wireless Services (57%), Smith Barney Shearson, Inc. (19%)                                                    
|61 South Paramus Avenue     |  | 1985       |  | 269,191                     |  | 100.0                                   |  | 6,718                         |  | 6,098                              |  | 1.37                                                                                 |  | 24.96                                        |  | 22.65                                             |  | Yamanouchi Pharma America, Inc. (21%)                                                                              
|Rochelle Park               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                    
|120 Passaic Street          |  | 1972       |  | 52,000                      |  | 99.6                                    |  | 1,397                         |  | 1,317                              |  | 0.28                                                                                 |  | 26.97                                        |  | 25.43                                             |  | SBC Telecom, Inc. (53%), Cantor Fitzgerald, L.P. (46%)                                                             
|365 West Passaic Street     |  | 1976       |  | 212,578                     |  | 88.9                                    |  | 4,178                         |  | 3,859                              |  | 0.85                                                                                 |  | 22.11                                        |  | 20.42                                             |  | United Retail, Inc. (31%), Regulus, LLC (10%)                                                                      

22

---

|Property
Location             |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's) (b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                                         
|----------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ------------------------------ |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------
|Upper Saddle River            |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                         
|1 Lake Street                 |  | 1973/94    |  | 474,801                     |  | 100.0                                   |  | 7,465                          |  | 7,465                              |  | 1.52                                                                                 |  | 15.72                                        |  | 15.72                                             |  | Prentice-Hall, Inc. (100%)                                                                                                                              
|10 Mountainview Road          |  | 1986       |  | 192,000                     |  | 95.8                                    |  | 3,907                          |  | 3,846                              |  | 0.80                                                                                 |  | 21.24                                        |  | 20.91                                             |  | Thomson Minwax Company (23%), Professional Detailing, Inc. (20%), Corning Life Sciences, Inc. (15%), ITT Fluid Technology (14%), Pearson Education (14%)
|Woodcliff Lake                |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                         
|400 Chestnut Ridge Road       |  | 1982       |  | 89,200                      |  | 100.0                                   |  | 2,124                          |  | 2,124                              |  | 0.43                                                                                 |  | 23.81                                        |  | 23.81                                             |  | Timeplex, Inc. (100%)                                                                                                                                   
|470 Chestnut Ridge Road       |  | 1987       |  | 52,500                      |  | 100.0                                   |  | 1,192                          |  | 1,192                              |  | 0.24                                                                                 |  | 22.70                                        |  | 22.70                                             |  | Andermatt, LP (100%)                                                                                                                                    
|530 Chestnut Ridge Road       |  | 1986       |  | 57,204                      |  | 100.0                                   |  | 1,166                          |  | 1,166                              |  | 0.24                                                                                 |  | 20.38                                        |  | 20.38                                             |  | KPMG Peat Marwick, LLP (100%)                                                                                                                           
|50 Tice Boulevard             |  | 1984       |  | 235,000                     |  | 100.0                                   |  | 5,631                          |  | 4,961                              |  | 1.15                                                                                 |  | 23.96                                        |  | 21.11                                             |  | Syncsort, Inc. (25%)                                                                                                                                    
|300 Tice Boulevard            |  | 1991       |  | 230,000                     |  | 100.0                                   |  | 5,342                          |  | 5,050                              |  | 1.09                                                                                 |  | 23.23                                        |  | 21.96                                             |  | Chase Home Mortgage Corp. (25%), Medco Containment Services (20%), Par Pharmaceutical, Inc. (16%), BMW of North America, LLC (15%)                      
|BURLINGTON COUNTY, NEW JERSEY |  |            |  |                             |  |                                         |  |                                |  |                                   
|Moorestown                    |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                         
|224 Strawbridge Drive         |  | 1984       |  | 74,000                      |  | 92.4                                    |  | 1,418                          |  | 1,054                              |  | 0.29                                                                                 |  | 20.74                                        |  | 15.41                                             |  | Allstate Insurance Company (49%), Harleysville Mutual Insurance (28%)                                                                                   
|228 Strawbridge Drive         |  | 1984       |  | 74,000                      |  | 100.0                                   |  | 1,434                          |  | 1,077                              |  | 0.29                                                                                 |  | 19.38                                        |  | 14.55                                             |  | Cendant Mortgage Corporation (100%)                                                                                                                     
|ESSEX COUNTY, NEW JERSEY      |  |            |  |                             |  |                                         |  |                                |  |                                   
|Millburn                      |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                         
|150 J.F. Kennedy Parkway      |  | 1980       |  | 247,476                     |  | 86.3                                    |  | 6,060                          |  | 5,872                              |  | 1.23                                                                                 |  | 28.37                                        |  | 27.49                                             |  | KPMG Peat Marwick, LLP (31%), Budd Larner Gross Et Al (23%)                                                                                             
|Roseland                      |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                         
|101 Eisenhower Parkway        |  | 1980       |  | 237,000                     |  | 83.2                                    |  | 4,656                          |  | 4,285                              |  | 0.95                                                                                 |  | 23.61                                        |  | 21.73                                             |  | Brach, Eichler, Rosenberg, Silver, Bernstein & Hammer (13%)                                                                                             
|103 Eisenhower Parkway        |  | 1985       |  | 151,545                     |  | 91.0                                    |  | 3,248                          |  | 2,918                              |  | 0.66                                                                                 |  | 23.55                                        |  | 21.16                                             |  | CPG Partners, L.P. (24%), Lum, Danzis, Drasco Positan & Kleinberg (16%), Salomon Smith Barney, Inc. (11%)                                               
|105 Eisenhower Parkway        |  | 2001       |  | 220,000                     |  | 14.0                                    |  | 1,904                          |  | 1,296                              |  | 0.39                                                                                 |  | 61.82                                        |  | 42.08                                             |  | McDonald's Corporation (14%)                                                                                                                            

23

---

|Property
Location                           |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                                             
|------------------------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------
|HUDSON COUNTY, NEW JERSEY                   |  |            |  |                             |  |                                         |  |                               |  |                                   
|Jersey City                                 |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                             
|Harborside Financial Center Plaza 1         |  | 1983       |  | 400,000                     |  | 99.0                                    |  | 3,277                         |  | 3,274                              |  | 0.67                                                                                 |  | 8.28                                         |  | 8.27                                              |  | Bankers Trust Harborside, Inc. (96%)                                                                                                                        
|Harborside Financial Center Plaza 2         |  | 1990       |  | 761,200                     |  | 100.0                                   |  | 19,408                        |  | 18,344                             |  | 3.95                                                                                 |  | 25.50                                        |  | 24.10                                             |  | Dean Witter Trust Company (27%), DLJ Securities (25%), Morgan Stanley Dean Witter, Inc. (11%), Dow Jones & Company, Inc. (11%), Lewco Securities Corp. (11%)
|Harborside Financial Center Plaza 3         |  | 1990       |  | 725,600                     |  | 100.0                                   |  | 18,499                        |  | 17,485                             |  | 3.77                                                                                 |  | 25.49                                        |  | 24.10                                             |  | AICPA (38%), BTM Information Services, Inc. (21%), Exodus Communications (11%), DLJ Securities (10%)                                                        
|Harborside Financial Center Plaza 4-A(g)    |  | 2000       |  | 207,670                     |  | 94.0                                    |  | 7,185                         |  | 6,481                              |  | 1.46                                                                                 |  | 36.82                                        |  | 33.21                                             |  | TD Waterhouse Securities, Inc. (89%)                                                                                                                        
|Harborside Financial Center Plaza 5 (h) (i) |  | 2002       |  | 980,000                     |  | 58.2                                    |  | 4,417                         |  | 4,125                              |  | 0.90                                                                                 |  | 21.91                                        |  | 20.46                                             |  | Forest Laboratories, Inc. (15%), Garban, LLC (14%), National Financial Services (12%)                                                                       
|MERCER COUNTY, NEW JERSEY                   |  |            |  |                             |  |                                         |  |                               |  |                                   
|Hamilton Township                           |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                             
|600 Horizon Drive (h)                       |  | 2002       |  | 95,000                      |  | 100.0                                   |  | 164                           |  | 164                                |  | 0.03                                                                                 |  | 14.32                                        |  | 14.32                                             |  | Verizon New Jersey, Inc. (100%)                                                                                                                             
|Princeton                                   |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                             
|103 Carnegie Center                         |  | 1984       |  | 96,000                      |  | 85.1                                    |  | 2,049                         |  | 1,894                              |  | 0.42                                                                                 |  | 25.08                                        |  | 23.18                                             |  | Ronin Development Corp. (15%), Kurt Salmon Assoc. Inc. (11%)                                                                                                
|100 Overlook Center                         |  | 1988       |  | 149,600                     |  | 100.0                                   |  | 3,751                         |  | 3,489                              |  | 0.76                                                                                 |  | 25.07                                        |  | 23.32                                             |  | Regus Business Centre Corp. (26%), Xerox Corporation (23%), Paine Webber, Inc. (14%)                                                                        
|5 Vaughn Drive                              |  | 1987       |  | 98,500                      |  | 80.8                                    |  | 1,968                         |  | 1,835                              |  | 0.40                                                                                 |  | 24.73                                        |  | 23.06                                             |  | Woodrow Wilson National Fellowship Foundation (17%), Floorgraphics, Inc. (14%), Villeroy & Boch Tableware, Ltd. (11%)                                       
|MIDDLESEX COUNTY, NEW JERSEY                |  |            |  |                             |  |                                         |  |                               |  |                                   
|East Brunswick                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                             
|377 Summerhill Road                         |  | 1977       |  | 40,000                      |  | 100.0                                   |  | 373                           |  | 368                                |  | 0.08                                                                                 |  | 9.33                                         |  | 9.20                                              |  | Greater New York Mutual Insurance Company (100%)                                                                                                            
|Plainsboro                                  |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                             
|500 College Road East                       |  | 1984       |  | 158,235                     |  | 100.0                                   |  | 3,705                         |  | 3,659                              |  | 0.75                                                                                 |  | 23.41                                        |  | 23.12                                             |  | SSB Realty, LLC (72%), Buchanan Ingersoll, P.C. (17%)                                                                                                       
|South Brunswick                             |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                             
|3 Independence Way                          |  | 1983       |  | 111,300                     |  | 35.5                                    |  | 1,284                         |  | 1,201                              |  | 0.26                                                                                 |  | 32.50                                        |  | 30.40                                             |  | Merrill Lynch Pierce Fenner & Smith (13%)                                                                                                                   

24

---

|Property
Location           |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's) (b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                       
|--------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ------------------------------ |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------
|Woodbridge                  |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                       
|581 Main Street             |  | 1991       |  | 200,000                     |  | 100.0                                   |  | 4,890                          |  | 4,777                              |  | 1.00                                                                                 |  | 24.45                                        |  | 23.89                                             |  | First Investors Management Company, Inc. (38%), Cast North America, Ltd. (11%)                                                        
|MONMOUTH COUNTY, NEW JERSEY |  |            |  |                             |  |                                         |  |                                |  |                                   
|Neptune                     |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                       
|3600 Route 66               |  | 1989       |  | 180,000                     |  | 100.0                                   |  | 2,410                          |  | 2,410                              |  | 0.49                                                                                 |  | 13.39                                        |  | 13.39                                             |  | United States Life Insurance Company (100%)                                                                                           
|Wall Township               |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                       
|1305 Campus Parkway         |  | 1988       |  | 23,350                      |  | 92.4                                    |  | 398                            |  | 365                                |  | 0.08                                                                                 |  | 18.45                                        |  | 16.92                                             |  | Waterford Wedgewood USA, Inc. (47%), McLaughlin, Bennett, Gelson (45%)                                                                
|1350 Campus Parkway         |  | 1990       |  | 79,747                      |  | 99.9                                    |  | 1,322                          |  | 1,247                              |  | 0.27                                                                                 |  | 16.59                                        |  | 15.65                                             |  | Meridian Health Realty Corp. (53%), Stephen E. Gertler Law Office (17%), Amper Politzner & Mattia, PA (11%), Healthcare Software (11%)
|MORRIS COUNTY, NEW JERSEY   |  |            |  |                             |  |                                         |  |                                |  |                                   
|Florham Park                |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                       
|325 Columbia Turnpike       |  | 1987       |  | 168,144                     |  | 100.0                                   |  | 4,431                          |  | 3,992                              |  | 0.90                                                                                 |  | 26.35                                        |  | 23.74                                             |  | Bressler Amery & Ross (24%), Salomon Smith Barney, Inc. (13%), Atlantic Health Systems (12%), Dun & Bradstreet, Inc. (12%)            
|Morris Plains               |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                       
|250 Johnson Road            |  | 1977       |  | 75,000                      |  | 100.0                                   |  | 1,594                          |  | 1,433                              |  | 0.32                                                                                 |  | 21.25                                        |  | 19.11                                             |  | Electronic Data Systems Corp. (100%)                                                                                                  
|201 Littleton Road          |  | 1979       |  | 88,369                      |  | 76.5                                    |  | 1,469                          |  | 1,381                              |  | 0.30                                                                                 |  | 21.73                                        |  | 20.43                                             |  | Xerox Corporation (50%), CHEP USA (11%)                                                                                               
|Morris Township             |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                       
|340 Mt. Kemble Avenue       |  | 1985       |  | 387,000                     |  | 100.0                                   |  | 5,530                          |  | 5,530                              |  | 1.13                                                                                 |  | 14.29                                        |  | 14.29                                             |  | AT&T Corporation (100%)                                                                                                               
|Parsippany                  |  |            |  |                             |  |                                         |  |                                |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                       
|4 Campus Drive              |  | 1983       |  | 147,475                     |  | 91.9                                    |  | 3,340                          |  | 3,339                              |  | 0.68                                                                                 |  | 24.64                                        |  | 24.64                                             |  | Nabisco, Inc. (27%), Summit Equities, Inc. (20%)                                                                                      
|6 Campus Drive              |  | 1983       |  | 148,291                     |  | 35.4                                    |  | 2,188                          |  | 2,173                              |  | 0.45                                                                                 |  | 41.68                                        |  | 41.39                                             |  |                                                                                                                                      
|7 Campus Drive              |  | 1982       |  | 154,395                     |  | 100.0                                   |  | 2,037                          |  | 1,924                              |  | 0.41                                                                                 |  | 13.19                                        |  | 12.46                                             |  | Nabisco, Inc. (100%)                                                                                                                  
|8 Campus Drive              |  | 1987       |  | 215,265                     |  | 86.2                                    |  | 5,186                          |  | 4,951                              |  | 1.06                                                                                 |  | 27.95                                        |  | 26.68                                             |  | Prudential Insurance Co. (31%), MCI Worldcom Communications Corp. (26%), Ayco Company, L.P. (13%)                                     
|9 Campus Drive              |  | 1983       |  | 156,495                     |  | 94.6                                    |  | 4,446                          |  | 4,409                              |  | 0.91                                                                                 |  | 30.03                                        |  | 29.78                                             |  | GAB Business Service, Inc. (48%)                                                                                                      
|2 Dryden Way                |  | 1990       |  | 6,216                       |  | 100.0                                   |  | 91                             |  | 91                                 |  | 0.02                                                                                 |  | 14.64                                        |  | 14.64                                             |  | Bright Horizons Childrens Center (100%)                                                                                               
|4 Gatehall Drive            |  | 1988       |  | 248,480                     |  | 91.8                                    |  | 5,795                          |  | 5,633                              |  | 1.18                                                                                 |  | 25.41                                        |  | 24.69                                             |  | J.B. Hanauer & Company (20%), Toyota Motor Credit Corp. (10%)                                                                         
|2 Hilton Court              |  | 1991       |  | 181,592                     |  | 100.0                                   |  | 4,793                          |  | 4,505                              |  | 0.98                                                                                 |  | 26.39                                        |  | 24.81                                             |  | Deloitte & Touche USA, LLP (47%), Sankyo Parke Davis (28%)                                                                            
|1633 Littleton Road (h)     |  | 1978       |  | 57,722                      |  | 100.0                                   |  | 189                            |  | 189                                |  | 0.04                                                                                 |  | 19.59                                        |  | 19.59                                             |  | Sordoni Skanska, Inc. (100%)                                                                                                          

25

---

|Property
Location           |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                   
|--------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | --------------------------------------------------------------------------------------------------
|600 Parsippany Road         |  | 1978       |  | 96,000                      |  | 44.8                                    |  | 1,259                         |  | 1,125                              |  | 0.26                                                                                 |  | 29.27                                        |  | 26.16                                             |  |                                                                                                  
|1 Sylvan Way                |  | 1989       |  | 150,557                     |  | 98.6                                    |  | 3,499                         |  | 3,096                              |  | 0.71                                                                                 |  | 23.57                                        |  | 20.86                                             |  | Cendant Operations, Inc. (99%)                                                                    
|5 Sylvan Way                |  | 1989       |  | 151,383                     |  | 100.0                                   |  | 4,023                         |  | 3,899                              |  | 0.82                                                                                 |  | 26.57                                        |  | 25.76                                             |  | Integrated Communications (41%), Experian Information Solution (15%), DRS Technologies, Inc. (13%)
|7 Sylvan Way                |  | 1987       |  | 145,983                     |  | 100.0                                   |  | 2,920                         |  | 2,759                              |  | 0.59                                                                                 |  | 20.00                                        |  | 18.90                                             |  | Nabisco, Inc. (100%)                                                                              
|PASSAIC COUNTY, NEW JERSEY  |  |            |  |                             |  |                                         |  |                               |  |                                   
|Clifton                     |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                   
|777 Passaic Avenue          |  | 1983       |  | 75,000                      |  | 99.6                                    |  | 1,526                         |  | 1,318                              |  | 0.31                                                                                 |  | 20.43                                        |  | 17.64                                             |  | Greenwich Home Mortgage Corp. (12%)                                                               
|Totowa                      |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                   
|999 Riverview Drive         |  | 1988       |  | 56,066                      |  | 83.3                                    |  | 649                           |  | 486                                |  | 0.13                                                                                 |  | 13.90                                        |  | 10.41                                             |  | Telsource Corporation (19%), Dunn Group, Inc. (15%), Humana Press (15%)                           
|Wayne                       |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                   
|201 Willowbrook Boulevard   |  | 1970       |  | 178,329                     |  | 61.8                                    |  | 1,806                         |  | 1,657                              |  | 0.37                                                                                 |  | 16.39                                        |  | 15.04                                             |  | URS Corporation (26%), Meridian Benefit, Inc. (22%), Aeropostale, Inc. (11%)                      
|SOMERSET COUNTY, NEW JERSEY |  |            |  |                             |  |                                         |  |                               |  |                                   
|Basking Ridge               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                   
|222 Mt. Airy Road           |  | 1986       |  | 49,000                      |  | 100.0                                   |  | 741                           |  | 689                                |  | 0.15                                                                                 |  | 15.12                                        |  | 14.06                                             |  | Avaya, Inc. (100%)                                                                                
|233 Mt. Airy Road           |  | 1987       |  | 66,000                      |  | 100.0                                   |  | 1,315                         |  | 1,103                              |  | 0.27                                                                                 |  | 19.92                                        |  | 16.71                                             |  | Avaya, Inc. (100%)                                                                                
|Bernards                    |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                   
|106 Allen Road              |  | 2000       |  | 132,010                     |  | 66.7                                    |  | 2,173                         |  | 1,717                              |  | 0.44                                                                                 |  | 24.68                                        |  | 19.50                                             |  | KPMG Consulting, LLC (59%)                                                                        
|Bridgewater                 |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                   
|721 Route 202/206           |  | 1989       |  | 192,741                     |  | 100.0                                   |  | 4,605                         |  | 4,398                              |  | 0.94                                                                                 |  | 23.89                                        |  | 22.82                                             |  | Allstate Insurance Company (37%), Norris, McLaughlin & Marcus, PA (32%), Johnson and Johnson (15%)
|UNION COUNTY, NEW JERSEY    |  |            |  |                             |  |                                         |  |                               |  |                                   
|Clark                       |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                   
|100 Walnut Avenue           |  | 1985       |  | 182,555                     |  | 100.0                                   |  | 4,565                         |  | 3,917                              |  | 0.93                                                                                 |  | 25.01                                        |  | 21.46                                             |  | CAP Gemini America, Inc. (33%), Washington Mutual Bank, FA (15%), DFDS Transport (US), Inc. (14%) 
|Cranford                    |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                   
|6 Commerce Drive            |  | 1973       |  | 56,000                      |  | 100.0                                   |  | 1,074                         |  | 945                                |  | 0.22                                                                                 |  | 19.18                                        |  | 16.88                                             |  | Kendle International, Inc. (50%)                                                                  
|11 Commerce Drive(c)        |  | 1981       |  | 90,000                      |  | 100.0                                   |  | 1,148                         |  | 933                                |  | 0.23                                                                                 |  | 12.76                                        |  | 10.37                                             |  | Northeast Administrators, Inc. (10%)                                                              

26

---

|Property
Location            |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                          
|---------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------
|12 Commerce Drive            |  | 1967       |  | 72,260                      |  | 85.8                                    |  | 862                           |  | 740                                |  | 0.18                                                                                 |  | 13.90                                        |  | 11.94                                             |  | Registrar & Transfer Company (36%), URS Corporation (28%)                                                
|20 Commerce Drive            |  | 1990       |  | 176,600                     |  | 100.0                                   |  | 4,303                         |  | 3,943                              |  | 0.88                                                                                 |  | 24.37                                        |  | 22.33                                             |  | Public Service Electric & Gas Company (26%), Quintiles, Inc. (21%)                                       
|25 Commerce Drive(h)         |  | 1971       |  | 67,749                      |  | 94.5                                    |  | 510                           |  | 508                                |  | 0.10                                                                                 |  | 20.05                                        |  | 19.97                                             |  | Paragon Computer Professional (33%), Wells Fargo Home Mortgage, Inc. (16%)                               
|65 Jackson Drive             |  | 1984       |  | 82,778                      |  | 86.9                                    |  | 1,757                         |  | 1,622                              |  | 0.36                                                                                 |  | 24.43                                        |  | 22.55                                             |  | PMK Group, Inc. (35%), Allstate Insurance Company (27%), Metropolitan Life Insurance Company (18%)       
|New Providence               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|890 Mountain Road            |  | 1977       |  | 80,000                      |  | 100.0                                   |  | 2,125                         |  | 2,037                              |  | 0.43                                                                                 |  | 26.56                                        |  | 25.46                                             |  | Aspen Technology, Inc. (52%), Dun & Bradstreet (27%), K Line America, Inc. (16%)                         
|                             |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|Total New Jersey Office      |  |            |  | 13,303,541                  |  | 93.0                                    |  | 257,116                       |  | 241,303                            |  | 52.37                                                                                |  | 21.66                                        |  | 20.34                                             |  |                                                                                                          
|                             |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|DUTCHESS COUNTY, NEW YORK    |  |            |  |                             |  |                                         |  |                               |  |                                   
|Fishkill                     |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|300 South Lake Drive         |  | 1987       |  | 118,727                     |  | 93.6                                    |  | 2,234                         |  | 2,172                              |  | 0.45                                                                                 |  | 20.10                                        |  | 19.54                                             |  | Allstate Insurance Company (24%)                                                                         
|NASSAU COUNTY, NEW YORK      |  |            |  |                             |  |                                         |  |                               |  |                                   
|North Hempstead              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|600 Community Drive          |  | 1983       |  | 237,274                     |  | 100.0                                   |  | 5,476                         |  | 5,476                              |  | 1.11                                                                                 |  | 23.08                                        |  | 23.08                                             |  | CMP Media, LLC. (100%)                                                                                   
|111 East Shore Road          |  | 1980       |  | 55,575                      |  | 100.0                                   |  | 1,518                         |  | 1,504                              |  | 0.31                                                                                 |  | 27.31                                        |  | 27.06                                             |  | Administrators for the Professions, Inc. (100%)                                                          
|ROCKLAND COUNTY, NEW YORK    |  |            |  |                             |  |                                         |  |                               |  |                                   
|Suffern                      |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|400 Rella Boulevard          |  | 1988       |  | 180,000                     |  | 99.8                                    |  | 3,915                         |  | 3,718                              |  | 0.80                                                                                 |  | 21.79                                        |  | 20.70                                             |  | Provident Savings Bank, F.A. (20%), Allstate Insurance Company (19%), Ferring Pharmaceuticals, Inc. (15%)
|WESTCHESTER COUNTY, NEW YORK |  |            |  |                             |  |                                         |  |                               |  |                                   
|Elmsford                     |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|100 Clearbrook Road(c)       |  | 1975       |  | 60,000                      |  | 100.0                                   |  | 1,081                         |  | 986                                |  | 0.22                                                                                 |  | 18.02                                        |  | 16.43                                             |  | MIM Corporation (18%), Pyrotek, Inc. (11%)                                                               
|101 Executive Boulevard      |  | 1971       |  | 50,000                      |  | 76.3                                    |  | 714                           |  | 663                                |  | 0.15                                                                                 |  | 18.72                                        |  | 17.38                                             |  | Pennysaver Group, Inc. (23%), Kyocera Mita America, Inc. (11%)                                           
|555 Taxter Road              |  | 1986       |  | 170,554                     |  | 89.9                                    |  | 3,919                         |  | 3,896                              |  | 0.80                                                                                 |  | 25.56                                        |  | 25.41                                             |  | Fuji Photo Film USA, Inc. (71%)                                                                          

27

---

|Property
Location     |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                          
|--------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------
|565 Taxter Road       |  | 1988       |  | 170,554                     |  | 85.3                                    |  | 3,740                         |  | 3,646                              |  | 0.76                                                                                 |  | 25.71                                        |  | 25.06                                             |  | Nextel of New York, Inc. (29%), KLM Royal Dutch Airlines (10%)                                           
|570 Taxter Road       |  | 1972       |  | 75,000                      |  | 92.4                                    |  | 1,673                         |  | 1,522                              |  | 0.34                                                                                 |  | 24.14                                        |  | 21.96                                             |  | Wilder Balter Partners, LLC (15%), New York State United Teachers Association (15%)                      
|Hawthorne             |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|1 Skyline Drive       |  | 1980       |  | 20,400                      |  | 99.0                                    |  | 330                           |  | 307                                |  | 0.07                                                                                 |  | 16.34                                        |  | 15.20                                             |  | Kidabilities, LLC & Speech (50%), Childtime Childcare, Inc. (49%)                                        
|2 Skyline Drive       |  | 1987       |  | 30,000                      |  | 98.9                                    |  | 467                           |  | 429                                |  | 0.10                                                                                 |  | 15.74                                        |  | 14.46                                             |  | MW Samara (56%), Perini Construction (43%)                                                               
|3 Skyline Drive(h)    |  | 1981       |  | 75,668                      |  | 100.0                                   |  | 679                           |  | 679                                |  | 0.14                                                                                 |  | 22.59                                        |  | 22.59                                             |  | Coca-Cola Bottling Company (73%), Taro Pharmaceuticals USA, Inc. (15%), Intermec Technologies Corp. (12%)
|7 Skyline Drive       |  | 1987       |  | 109,000                     |  | 95.5                                    |  | 1,627                         |  | 1,615                              |  | 0.33                                                                                 |  | 15.63                                        |  | 15.51                                             |  | EM Industries, Inc. (31%), Cavalry Investments, LLC (19%), Traub Eglin Lieberman & Straus (14%)          
|17 Skyline Drive      |  | 1989       |  | 85,000                      |  | 100.0                                   |  | 1,360                         |  | 1,336                              |  | 0.28                                                                                 |  | 16.00                                        |  | 15.72                                             |  | IBM Corporation (100%)                                                                                   
|19 Skyline Drive      |  | 1982       |  | 248,400                     |  | 100.0                                   |  | 4,519                         |  | 4,005                              |  | 0.92                                                                                 |  | 18.19                                        |  | 16.12                                             |  | IBM Corporation (100%)                                                                                   
|Tarrytown             |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|200 White Plains Road |  | 1982       |  | 89,000                      |  | 93.8                                    |  | 1,470                         |  | 1,299                              |  | 0.30                                                                                 |  | 17.61                                        |  | 15.56                                             |  | Allmerica Financial (17%), Dannon Company, Inc. (17%), NYS Dept. of Environmental Services (13%)         
|220 White Plains Road |  | 1984       |  | 89,000                      |  | 98.6                                    |  | 2,117                         |  | 1,988                              |  | 0.43                                                                                 |  | 24.12                                        |  | 22.65                                             |  | Eagle Family Foods, Inc. (17%)                                                                           
|White Plains          |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|1 Barker Avenue       |  | 1975       |  | 68,000                      |  | 99.0                                    |  | 1,672                         |  | 1,609                              |  | 0.34                                                                                 |  | 24.84                                        |  | 23.90                                             |  | O'Connor McGuinness Conte (19%), United Skys Realty Corp. (16%)                                          
|3 Barker Avenue       |  | 1983       |  | 65,300                      |  | 100.0                                   |  | 1,645                         |  | 1,489                              |  | 0.33                                                                                 |  | 25.19                                        |  | 22.80                                             |  | Trigen Energy Corporation (56%), TNS Intersearch Corporation (10%)                                       
|50 Main Street        |  | 1985       |  | 309,000                     |  | 96.8                                    |  | 8,652                         |  | 8,119                              |  | 1.76                                                                                 |  | 28.93                                        |  | 27.14                                             |  | TMP Worldwide, Inc. (15%), National Economic Research (10%)                                              
|11 Martine Avenue     |  | 1987       |  | 180,000                     |  | 92.9                                    |  | 4,454                         |  | 4,087                              |  | 0.91                                                                                 |  | 26.64                                        |  | 24.44                                             |  | Salomon Smith Barney, Inc. (12%), McCarthy Fingar Donovan Et Al (11%), Morgan Stanley Dean Witter (11%)  
|1 Water Street        |  | 1979       |  | 45,700                      |  | 83.9                                    |  | 774                           |  | 720                                |  | 0.16                                                                                 |  | 20.19                                        |  | 18.78                                             |  | AMG In-Store, Inc. (32%), Urban Dental Mgmt, Inc. (16%)                                                  
|Yonkers               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                          
|1 Executive Boulevard |  | 1982       |  | 112,000                     |  | 100.0                                   |  | 2,698                         |  | 2,589                              |  | 0.55                                                                                 |  | 24.09                                        |  | 23.12                                             |  | Affinity Healthplan, Inc. (21%), Protective Tech International (11%), AVR Realty Company (11%)           

28

---



|Property
Location               |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                              
|------------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------
|3 Executive Plaza               |  | 1987       |  | 58,000                      |  | 94.9                                    |  | 1,421                         |  | 1,295                              |  | 0.29                                                                                 |  | 25.82                                        |  | 23.53                                             |  | Montefiore Medical Center (46%), City & Suburban Federal Savings Bank (22%), Allstate Insurance Company (20%)
|                                |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                              
|Total New York Office           |  | 2,702,152  |  | 95.8                        |  | 58,155                                  |  | 55,149                        |  | 11.85                              |  | 22.86                                                                                |  | 21.70                                        |  |                                                  
|                                |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                              
|CHESTER COUNTY, PENNSYLVANIA    |  |            |  |                             |  |                                         |  |                               |  |                                   
|Berwyn                          |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                              
|1000 Westlakes Drive            |  | 1989       |  | 60,696                      |  | 87.3                                    |  | 1,495                         |  | 1,449                              |  | 0.30                                                                                 |  | 28.21                                        |  | 27.35                                             |  | Drinker Biddle & Reath (42%), PNC Bank, NA (38%)                                                             
|1055 Westlakes Drive            |  | 1990       |  | 118,487                     |  | 57.9                                    |  | 1,521                         |  | 1,329                              |  | 0.31                                                                                 |  | 22.17                                        |  | 19.37                                             |  | Regus Business Centre Corp. (35%), Eximias Pharmaceutical Corp. (18%)                                        
|1205 Westlakes Drive            |  | 1988       |  | 130,265                     |  | 97.6                                    |  | 2,685                         |  | 2,570                              |  | 0.55                                                                                 |  | 21.12                                        |  | 20.21                                             |  | Turner Investment Partners (30%), Oracle Corporation (30%)                                                   
|1235 Westlakes Drive            |  | 1986       |  | 134,902                     |  | 61.4                                    |  | 2,603                         |  | 2,461                              |  | 0.53                                                                                 |  | 31.43                                        |  | 29.71                                             |  | Ratner & Prestia (19%), Chartwell Investment Partners (15%)                                                  
|DELAWARE COUNTY, PENNSYLVANIA   |  |            |  |                             |  |                                         |  |                               |  |                                   
|Lester                          |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                              
|100 Stevens Drive               |  | 1986       |  | 95,000                      |  | 100.0                                   |  | 2,541                         |  | 2,339                              |  | 0.52                                                                                 |  | 26.75                                        |  | 24.62                                             |  | Keystone Mercy Health Plan (100%)                                                                            
|200 Stevens Drive               |  | 1987       |  | 208,000                     |  | 100.0                                   |  | 5,605                         |  | 5,052                              |  | 1.14                                                                                 |  | 26.95                                        |  | 24.29                                             |  | Keystone Mercy Health Plan (100%)                                                                            
|300 Stevens Drive               |  | 1992       |  | 68,000                      |  | 53.0                                    |  | 891                           |  | 653                                |  | 0.18                                                                                 |  | 24.72                                        |  | 18.12                                             |  | Hewlett Packard Company (35%)                                                                                
|Media                           |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                              
|1400 Providence RoadCenter I   |  | 1986       |  | 100,000                     |  | 91.9                                    |  | 2,106                         |  | 1,938                              |  | 0.43                                                                                 |  | 22.92                                        |  | 21.09                                             |  | General Services Admin. (13%), Erie Indemnity Company (11%)                                                  
|1400 Providence RoadCenter II  |  | 1990       |  | 160,000                     |  | 88.0                                    |  | 2,986                         |  | 2,685                              |  | 0.61                                                                                 |  | 21.21                                        |  | 19.07                                             |  | Barnett International (36%)                                                                                  
|MONTGOMERY COUNTY, PENNSYLVANIA |  |            |  |                             |  |                                         |  |                               |  |                                   
|Blue Bell                       |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                              
|16 Sentry Parkway(h)            |  | 1988       |  | 93,093                      |  | 85.4                                    |  | 5                             |  | 5                                  |  | 0.00                                                                                 |  | 22.96                                        |  | 22.96                                             |  | Pharmanet, Inc. (42%), London Life Reinsurance Co. (11%), Broadwing Communications Services (10%)            
|18 Sentry Parkway(h)            |  | 1988       |  | 95,010                      |  | 100.0                                   |  | 6                             |  | 6                                  |  | 0.00                                                                                 |  | 23.05                                        |  | 23.05                                             |  | Liberty Mutual Insurance Co. (25%), Larson Allen Weishair & Co. (24%), Executive Suites, Inc. (12%)          

29

---

|Property
Location             |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                    
|----------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------
|King of Prussia               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|2200 Renaissance Boulevard(h) |  | 1985       |  | 174,124                     |  | 88.9                                    |  | 219                           |  | 219                                |  | 0.04                                                                                 |  | 24.59                                        |  | 24.59                                             |  | MDS Pharma Services (27%), Henkel Corporation (20%), SmithKline Beecham Corp. (12%)                                                
|Lower Providence              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|1000 Madison Avenue           |  | 1990       |  | 100,700                     |  | 68.7                                    |  | 1,859                         |  | 1,755                              |  | 0.38                                                                                 |  | 26.87                                        |  | 25.37                                             |  | Reuters America, Inc. (42%), Seton Company (15%)                                                                                   
|Plymouth Meeting              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|1150 Plymouth Meeting Mall    |  | 1970       |  | 167,748                     |  | 97.7                                    |  | 3,464                         |  | 3,231                              |  | 0.71                                                                                 |  | 21.14                                        |  | 19.71                                             |  | Ken-Crest Services (18%), Lincoln Technical Institute (18%), Ikea US General Partners, Inc. (14%), ECC Management Services (13%)   
|Five Sentry Parkway East      |  | 1984       |  | 91,600                      |  | 100.0                                   |  | 1,900                         |  | 1,842                              |  | 0.39                                                                                 |  | 20.74                                        |  | 20.11                                             |  | Merck & Co., Inc. (77%), Selas Fluid Processing Corp. (23%)                                                                        
|Five Sentry Parkway West      |  | 1984       |  | 38,400                      |  | 100.0                                   |  | 822                           |  | 803                                |  | 0.17                                                                                 |  | 21.41                                        |  | 20.91                                             |  | Merck & Co., Inc. (70%), David Cutler Group (30%)                                                                                  
|                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|Total Pennsylvania Office     |  | 1,836,025  |  | 86.9                        |  | 30,708                                  |  | 28,337                        |  | 6.26                               |  | 24.00                                                                                |  | 22.52                                        |  |                                                  
|                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|FAIRFIELD COUNTY, CONNECTICUT |  |            |  |                             |  |                                         |  |                               |  |                                   
|Greenwich                     |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|500 West Putnam Avenue        |  | 1973       |  | 121,250                     |  | 89.0                                    |  | 2,911                         |  | 2,753                              |  | 0.59                                                                                 |  | 26.98                                        |  | 25.51                                             |  | Hachette Filipacchi Magazines (27%), McMahan Securities Co., LP (16%), Greenwich Hospital (13%), Winklevoss Consultants, Inc. (12%)
|Norwalk                       |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|40 Richards Avenue            |  | 1985       |  | 145,487                     |  | 92.7                                    |  | 3,296                         |  | 3,017                              |  | 0.67                                                                                 |  | 24.44                                        |  | 22.37                                             |  | South Beach Beverage Co., LLC (14%), Media Horizons, Inc. (12%)                                                                    
|Shelton                       |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|1000 Bridgeport Avenue        |  | 1986       |  | 133,000                     |  | 100.0                                   |  | 2,662                         |  | 2,545                              |  | 0.54                                                                                 |  | 20.02                                        |  | 19.14                                             |  | William Carter Company (23%), Toyota Motor Credit Corporation (11%), Peabody Engineering Corp. (11%)                               
|Stamford                      |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|1266 East Main Street(h)      |  | 1984       |  | 179,260                     |  | 95.5                                    |  | 742                           |  | 741                                |  | 0.15                                                                                 |  | 27.75                                        |  | 27.72                                             |  | Octagon Marketing and Athlete (18%), Chilton Investment and Company, Inc. (12%)                                                    
|                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    
|Total Connecticut Office      |  | 578,997    |  | 94.5                        |  | 9,611                                   |  | 9,056                         |  | 1.95                               |  | 24.90                                                                                |  | 23.88                                        |  |                                                  
|                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                    

30

---

|Property
Location                 |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                         
|--------------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------
|WASHINGTON, D.C.                  |  |            |  |                             |  |                                         |  |                               |  |                                   
|1201 Connecticut Avenue, NW       |  | 1940       |  | 169,549                     |  | 100.0                                   |  | 5,413                         |  | 5,242                              |  | 1.10                                                                                 |  | 31.93                                        |  | 30.92                                             |  | Zuckerman Spaeder Goldstein (30%), RFE/RL, Inc. (16%), Leo A. Daly Company (13%)                        
|1400 L Street, NW                 |  | 1987       |  | 159,000                     |  | 100.0                                   |  | 6,008                         |  | 5,842                              |  | 1.22                                                                                 |  | 37.79                                        |  | 36.74                                             |  | Winston & Strawn (68%)                                                                                  
|                                  |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|Total District of Columbia Office |  | 328,549    |  | 100.0                       |  | 11,421                                  |  | 11,084                        |  | 2.32                               |  | 34.76                                                                                |  | 33.74                                        |  |                                                  
|                                  |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|PRINCE GEORGE'S COUNTY, MARYLAND  |  |            |  |                             |  |                                         |  |                               |  |                                   
|Lanham                            |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|4200 Parliament Place             |  | 1989       |  | 122,000                     |  | 99.9                                    |  | 2,689                         |  | 2,508                              |  | 0.55                                                                                 |  | 22.06                                        |  | 20.58                                             |  | Group I Software, Inc. (56%), Infinity Broadcasting Company (19%), State Farm Mutual Auto Ins. Co. (11%)
|                                  |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|Total Maryland Office             |  | 122,000    |  | 99.9                        |  | 2,689                                   |  | 2,508                         |  | 0.55                               |  | 22.06                                                                                |  | 20.58                                        |  |                                                  
|                                  |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|BEXAR COUNTY, TEXAS               |  |            |  |                             |  |                                         |  |                               |  |                                   
|San Antonio                       |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|84 N.E. Loop 410                  |  | 1971       |  | 187,312                     |  | 94.2                                    |  | 2,853                         |  | 2,757                              |  | 0.58                                                                                 |  | 16.17                                        |  | 15.63                                             |  | KBL Cable, Inc. (27%), Chase Bank and Services, Inc. (25%), Philip Morris Mgmt. Corp. (25%)             
|111 Soledad                       |  | 1918       |  | 248,153                     |  | 63.0                                    |  | 1,793                         |  | 1,172                              |  | 0.36                                                                                 |  | 11.47                                        |  | 7.50                                              |  | City of San Antonio (12%)                                                                               
|COLLIN COUNTY, TEXAS              |  |            |  |                             |  |                                         |  |                               |  |                                   
|Plano                             |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|555 Republic Place(j)             |  | 1986       |  |                            |  |                                        |  | 517                           |  | 517                                |  | 0.11                                                                                 |  |                                             |  |                                                  |  |                                                                                                        
|DALLAS COUNTY, TEXAS              |  |            |  |                             |  |                                         |  |                               |  |                                   
|DALLAS                            |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|3030 LBJ Freeway(c)               |  | 1984       |  | 367,018                     |  | 81.0                                    |  | 6,006                         |  | 5,316                              |  | 1.22                                                                                 |  | 20.20                                        |  | 17.88                                             |  | Club Corporation of America (34%)                                                                       
|3100 Monticello(j)                |  | 1984       |  |                            |  |                                        |  | 1,029                         |  | 1,026                              |  | 0.21                                                                                 |  |                                             |  |                                                  |  |                                                                                                        
|Irving                            |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|2300 Valley View(j)               |  | 1985       |  |                            |  |                                        |  | 840                           |  | 837                                |  | 0.17                                                                                 |  |                                             |  |                                                  |  |                                                                                                        
|Richardson                        |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|1122 Alma Road                    |  | 1977       |  | 82,576                      |  | 100.0                                   |  | 607                           |  | 607                                |  | 0.12                                                                                 |  | 7.35                                         |  | 7.35                                              |  | MCI Worldcom Network Services (100%)                                                                    
|HARRIS COUNTY, TEXAS              |  |            |  |                             |  |                                         |  |                               |  |                                   
|Houston                           |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                         
|5300 Memorial(j)                  |  | 1982       |  |                            |  |                                        |  | 994                           |  | 991                                |  | 0.20                                                                                 |  |                                             |  |                                                  |  |                                                                                                        

31

---

|Property
Location              |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)
(b)(c) |  | 2002
Effective
Rent
($000's)
(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent(%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing
10% or More
of Net Rentable
Area Per Property
as of 12/31/02(c)                                         
|------------------------------ |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ------------------------------ |  | ----------------------------------- |  | ----------------------------------------------------------------------------------- |  | -------------------------------------------- |  | ------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------
|1717 St. James Place(j)        |  | 1975       |  |                            |  |                                        |  | 652                            |  | 652                                 |  | 0.13                                                                                |  |                                             |  |                                                  |  |                                                                                                                        
|1770 St. James Place           |  | 1973       |  | 103,689                     |  | 77.8                                    |  | 1,180                          |  | 941                                 |  | 0.24                                                                                |  | 14.63                                        |  | 11.66                                             |  |                                                                                                                        
|10497 Town & Country Way(j)    |  | 1981       |  |                            |  |                                        |  | 784                            |  | 783                                 |  | 0.16                                                                                |  |                                             |  |                                                  |  |                                                                                                                        
|TARRANT COUNTY, TEXAS          |  |            |  |                             |  |                                         |  |                                |  |                                    
|Euless                         |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|150 West Parkway(j)            |  | 1984       |  |                            |  |                                        |  | 402                            |  | 402                                 |  | 0.08                                                                                |  |                                             |  |                                                  |  |                                                                                                                        
|                               |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|Total Texas Office             |  |            |  | 988,748                     |  | 80.2                                    |  | 17,657                         |  | 16,001                              |  | 3.58                                                                                |  | 22.26                                        |  | 20.17                                             |  |                                                                                                                         
|                               |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|MARICOPA COUNTY, ARIZONA       |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                             
|Glendale                       |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|5551 West Talavi Boulevard(j)  |  | 1991       |  |                            |  |                                        |  | 1,299                          |  | 1,299                               |  | 0.26                                                                                |  |                                             |  |                                                  |  |                                                                                                                        
|Phoenix                        |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|19640 North 31st Street(j)     |  | 1990       |  |                            |  |                                        |  | 1,227                          |  | 1,227                               |  | 0.25                                                                                |  |                                             |  |                                                  |  |                                                                                                                        
|Scottsdale                     |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|9060 E. Via Linda Boulevard(j) |  | 1984       |  |                            |  |                                        |  | 1,856                          |  | 1,856                               |  | 0.38                                                                                |  |                                             |  |                                                  |  |                                                                                                                        
|                               |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|Total Arizona Office           |  |            |  |                            |  |                                        |  | 4,382                          |  | 4,382                               |  | 0.89                                                                                |  |                                             |  |                                                  |  |                                                                                                                         
|                               |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|ARAPAHOE COUNTY, COLORADO      |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                    
|Aurora                         |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|750 South Richfield Street(j)  |  | 1997       |  |                            |  |                                        |  | 1,173                          |  | 1,173                               |  | 0.24                                                                                |  |                                             |  |                                                  |  |                                                                                                                        
|Denver                         |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|400 South Colorado Boulevard   |  | 1983       |  | 125,415                     |  | 99.7                                    |  | 2,268                          |  | 1,942                               |  | 0.46                                                                                |  | 18.14                                        |  | 15.53                                             |  | Community Health Plan (36%), State of Colorado (12%), Senter Goldfarb & Rice, LLC (11%), Wells Fargo Bank West, NA (11%)
|Englewood                      |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|9359 East Nichols Avenue       |  | 1997       |  | 72,610                      |  | 100.0                                   |  | 908                            |  | 908                                 |  | 0.18                                                                                |  | 12.51                                        |  | 12.51                                             |  | First Tennessee Bank, NA (100%)                                                                                         
|5350 South Roslyn Street       |  | 1982       |  | 63,754                      |  | 94.2                                    |  | 1,073                          |  | 850                                 |  | 0.22                                                                                |  | 17.87                                        |  | 14.15                                             |  | Alliance Metro Real Estate (22%), Bathgate Capital Partners, LLC (19%), Walker Parking Consultants (12%)                
|BOULDER COUNTY, COLORADO       |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                             
|Broomfield                     |  |            |  |                             |  |                                         |  |                                |  |                                     |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                                         
|105 South Technology Court     |  | 1997       |  | 37,574                      |  | 100.0                                   |  | 567                            |  | 567                                 |  | 0.12                                                                                |  | 15.09                                        |  | 15.09                                             |  | Sun Microsystems, Inc. (100%)                                                                                           
|303 South Technology Court-A   |  | 1997       |  | 34,454                      |  | 0.0                                     |  | 306                            |  | 306                                 |  | 0.06                                                                                |  |                                             |  |                                                  |  |                                                                                                                        
|303 South Technology Court-B   |  | 1997       |  | 40,416                      |  | 0.0                                     |  | 360                            |  | 360                                 |  | 0.07                                                                                |  |                                             |  |                                                  |  |                                                                                                                        

32

---

|Property
Location           |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10%
or More of Net Rentable
Area Per Property
as of 12/31/02(c)         
|--------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | ----------------------------------------------------------------------------------------
|Louisville                  |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                         
|248 Centennial Parkway      |  | 1996       |  | 39,266                      |  | 72.0                                    |  | 525                           |  | 518                                |  | 0.11                                                                                 |  | 18.57                                        |  | 18.32                                             |  | Walnut Brewery, Inc. (59%)                                                              
|1172 Century Drive          |  | 1996       |  | 49,566                      |  | 100.0                                   |  | 662                           |  | 654                                |  | 0.13                                                                                 |  | 13.36                                        |  | 13.19                                             |  | nCube Corporation (40%), EDS/SHL Inc. (22%), Aircell, Inc. (22%), RX Kinetix, Inc. (16%)
|285 Century Place           |  | 1997       |  | 69,145                      |  | 100.0                                   |  | 1,129                         |  | 1,129                              |  | 0.23                                                                                 |  | 16.33                                        |  | 16.33                                             |  | HBO & Company of Georgia (100%)                                                         
|DENVER COUNTY, COLORADO     |  |            |  |                             |  |                                         |  |                               |  |                                   
|Denver                      |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                         
|3600 South Yosemite         |  | 1974       |  | 133,743                     |  | 100.0                                   |  | 1,446                         |  | 1,446                              |  | 0.29                                                                                 |  | 10.81                                        |  | 10.81                                             |  | M.D.C. Holdings, Inc. (100%)                                                            
|DOUGLAS COUNTY, COLORADO    |  |            |  |                             |  |                                         |  |                               |  |                                   
|Englewood                   |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                         
|8181 East Tufts Avenue      |  | 2001       |  | 185,254                     |  | 74.5                                    |  | 3,575                         |  | 2,100                              |  | 0.73                                                                                 |  | 25.90                                        |  | 15.22                                             |  | URS Greiner (66%)                                                                       
|400 Inverness Parkway       |  | 1997       |  | 111,608                     |  | 92.7                                    |  | 2,236                         |  | 1,693                              |  | 0.46                                                                                 |  | 21.61                                        |  | 16.36                                             |  | Cochlear Corporation (33%), HQ Global Workplaces, Inc. (16%), Compuware Corp. (13%)     
|67 Inverness Drive East     |  | 1996       |  | 54,280                      |  | 49.1                                    |  | 69                            |  | 63                                 |  | 0.01                                                                                 |  | 2.59                                         |  | 2.36                                              |  | Gericare Providers, Inc. (49%)                                                          
|384 Inverness Parkway       |  | 1985       |  | 51,523                      |  | 78.7                                    |  | 678                           |  | 532                                |  | 0.14                                                                                 |  | 16.72                                        |  | 13.12                                             |  | Quickpen International Corp. (35%)                                                      
|5975 South Quebec Street(c) |  | 1996       |  | 102,877                     |  | 57.5                                    |  | 873                           |  | 615                                |  | 0.18                                                                                 |  | 14.76                                        |  | 10.40                                             |  | KB Home Colorado, Inc. (27%), Silicon Graphics, Inc. (13%)                              
|Parker                      |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                         
|9777 Mount Pyramid Court    |  | 1995       |  | 120,281                     |  | 40.4                                    |  | 1,032                         |  | 1,032                              |  | 0.21                                                                                 |  | 21.24                                        |  | 21.24                                             |  | Evolving Systems, Inc. (29%), Charter Communications, LLC (11%)                         
|EL PASO COUNTY, COLORADO    |  |            |  |                             |  |                                         |  |                               |  |                                   
|Colorado Springs            |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                         
|8415 Explorer               |  | 1998       |  | 47,368                      |  | 100.0                                   |  | 617                           |  | 581                                |  | 0.13                                                                                 |  | 13.03                                        |  | 12.27                                             |  | Encoda Systems, Inc. (74%), URS Greiner Consultants, Inc. (22%)                         
|1975 Research Parkway       |  | 1997       |  | 115,250                     |  | 90.9                                    |  | 1,751                         |  | 1,547                              |  | 0.36                                                                                 |  | 16.71                                        |  | 14.77                                             |  | Bombardier Capital Florida, Inc. (52%), General Dynamics Govt. Systems (17%)            
|2375 Telstar Drive          |  | 1998       |  | 47,369                      |  | 100.0                                   |  | 617                           |  | 581                                |  | 0.13                                                                                 |  | 13.03                                        |  | 12.27                                             |  | Narwhal Corporation (44%), Memorial Hospital (38%), Aerotek, Inc. (13%)                 

33

---

|Property
Location                |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)     
|-------------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | ------------------------------------------------------------------------------------
|JEFFERSON COUNTY, COLORADO       |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     
|Lakewood                         |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     
|141 Union Boulevard              |  | 1985       |  | 63,600                      |  | 88.9                                    |  | 1,112                         |  | 914                                |  | 0.23                                                                                 |  | 19.67                                        |  | 16.17                                             |  | Arbitration Forums, Inc. (22%), DBA Coldwell Bankers Res. Brkg. (15%)               
|                                 |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     
|Total Colorado Office            |  |            |  | 1,565,353                   |  | 79.8                                    |  | 22,977                        |  | 19,511                             |  | 4.69                                                                                 |  | 18.43                                        |  | 15.65                                             |  |                                                                                     
|                                 |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     
|SAN FRANCISCO COUNTY, CALIFORNIA |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     
|San Francisco                    |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     
|795 Folsom Street                |  | 1977       |  | 183,445                     |  | 100.0                                   |  | 6,501                         |  | 5,731                              |  | 1.32                                                                                 |  | 35.44                                        |  | 31.24                                             |  | Move.com Operations, Inc. (51%), AT&T Corp. (34%), Regus Business Centre Corp. (15%)
|760 Market Street                |  | 1908       |  | 267,446                     |  | 95.4                                    |  | 8,625                         |  | 8,311                              |  | 1.76                                                                                 |  | 33.80                                        |  | 32.57                                             |  | R.H. Macy & Company, Inc. (22%)                                                     
|                                 |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     
|Total California Office          |  |            |  | 450,891                     |  | 97.3                                    |  | 15,126                        |  | 14,042                             |  | 3.08                                                                                 |  | 34.49                                        |  | 32.02                                             |  |                                                                                     
|                                 |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     
|HILLSBOROUGH COUNTY, FLORIDA     |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     
|Tampa                            |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     
|501 Kennedy Boulevard(j)         |  | 1982       |  |                            |  |                                        |  | 2,067                         |  | 2,067                              |  | 0.42                                                                                 |  |                                             |  |                                                  |  |                                                                                    
|                                 |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     
|Total Florida Office             |  |            |  |                            |  |                                        |  | 2,067                         |  | 2,067                              |  | 0.42                                                                                 |  |                                              |  |                                                   |  |                                                                                     
|                                 |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     
|TOTAL OFFICE PROPERTIES          |  |            |  | 21,876,256                  |  | 91.5                                    |  | 431,909                       |  | 403,440                            |  | 87.96                                                                                |  | 22.75                                        |  | 21.30                                             |  |                                                                                     
|                                 |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                     

34

---

Property Listing

Office/Flex Properties

|Property Location             |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per
Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per
Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                                                                          
|----------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|BURLINGTON COUNTY, NEW JERSEY |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     
|Burlington                    |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                                          
|3 Terri Lane                  |  | 1991       |  | 64,500                      |  | 61.4                                    |  | 294                           |  | 268                                |  | 0.06                                                                                 |  | 7.42                                         |  | 6.77                                              |  | Tempel Steel Company (18%), General Service Administrators (10%)                                                                                                                         
|5 Terri Lane                  |  | 1992       |  | 74,555                      |  | 82.2                                    |  | 498                           |  | 467                                |  | 0.10                                                                                 |  | 8.13                                         |  | 7.62                                              |  | United Rentals, Inc. (22%), Vitality Foodservice, Inc. (20%), West Electronics, Inc. (12%)                                                                                               
|Moorestown                    |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                                          
|2 Commerce Drive              |  | 1986       |  | 49,000                      |  | 100.0                                   |  | 416                           |  | 390                                |  | 0.08                                                                                 |  | 8.49                                         |  | 7.96                                              |  | Computer Sciences Corporation (100%)                                                                                                                                                     
|101 Commerce Drive            |  | 1988       |  | 64,700                      |  | 100.0                                   |  | 336                           |  | 296                                |  | 0.07                                                                                 |  | 5.19                                         |  | 4.57                                              |  | Beckett Corporation (100%)                                                                                                                                                               
|102 Commerce Drive            |  | 1987       |  | 38,400                      |  | 87.5                                    |  | 205                           |  | 199                                |  | 0.04                                                                                 |  | 6.10                                         |  | 5.92                                              |  | Nelson Associates (25%), D&A Eastern Fasteners, Inc. (13%), Hewlett-Packard Company (13%), Moorestown Weightlifting Club (13%), Opex Corporation (13%), Transaction Payment Systems (13%)
|201 Commerce Drive            |  | 1986       |  | 38,400                      |  | 75.0                                    |  | 173                           |  | 167                                |  | 0.04                                                                                 |  | 6.01                                         |  | 5.80                                              |  | Flow Thru Metals, Inc. (25%), Franchise Stores Realty Corp. (25%), Tropicana Products, Inc. (25%)                                                                                        
|202 Commerce Drive            |  | 1988       |  | 51,200                      |  | 25.3                                    |  | 118                           |  | 113                                |  | 0.02                                                                                 |  | 9.11                                         |  | 8.72                                              |  | Standard Register Co. (25%)                                                                                                                                                              
|1 Executive Drive             |  | 1989       |  | 20,570                      |  | 100.0                                   |  | 218                           |  | 184                                |  | 0.04                                                                                 |  | 10.60                                        |  | 8.95                                              |  | Bechtel Infrastructure Corp. (57%), T.T.I. (18%)                                                                                                                                         
|2 Executive Drive             |  | 1988       |  | 60,800                      |  | 88.1                                    |  | 387                           |  | 350                                |  | 0.08                                                                                 |  | 7.22                                         |  | 6.53                                              |  | CSI Computer Specialists, Inc. (32%), Foundations, Inc. (22%)                                                                                                                            
|101 Executive Drive           |  | 1990       |  | 29,355                      |  | 84.7                                    |  | 276                           |  | 226                                |  | 0.06                                                                                 |  | 11.10                                        |  | 9.09                                              |  | Bayada Nurses, Inc. (56%)                                                                                                                                                                
|102 Executive Drive           |  | 1990       |  | 64,000                      |  | 100.0                                   |  | 358                           |  | 313                                |  | 0.07                                                                                 |  | 5.59                                         |  | 4.89                                              |  | Xermis Inc. (30%), Comtrex Systems Corp. (29%), Sunday O'Brien & Syscom Elec. (21%), Schermerhorn Bros. Co. (20%)                                                                        
|225 Executive Drive           |  | 1990       |  | 50,600                      |  | 86.2                                    |  | 340                           |  | 323                                |  | 0.07                                                                                 |  | 7.80                                         |  | 7.41                                              |  | Eastern Research, Inc. (77%)                                                                                                                                                             
|97 Foster Road                |  | 1982       |  | 43,200                      |  | 100.0                                   |  | 136                           |  | 132                                |  | 0.03                                                                                 |  | 3.15                                         |  | 3.06                                              |  | Pioneer and Company, Inc. (33%), Premier Percussion, Limited (25%), Speck Industrial Controls (25%), Colornet, Inc. (17%)                                                                
|1507 Lancer Drive             |  | 1995       |  | 32,700                      |  | 100.0                                   |  | 151                           |  | 140                                |  | 0.03                                                                                 |  | 4.62                                         |  | 4.28                                              |  | Tad's Delivery Service, Inc. (100%)                                                                                                                                                      

35

---

|Property Location         |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per
Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per
Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                                                                                                          
|------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1510 Lancer Drive         |  | 1998       |  | 88,000                      |  | 100.0                                   |  | 370                           |  | 370                                |  | 0.08                                                                                 |  | 4.20                                         |  | 4.20                                              |  | Tad's Delivery Service, Inc. (100%)                                                                                                                                                                                      
|1245 North Church Street  |  | 1998       |  | 52,810                      |  | 100.0                                   |  | 384                           |  | 384                                |  | 0.08                                                                                 |  | 7.27                                         |  | 7.27                                              |  | Health Ink, LLC (38%), C&L Properties, L.L.C. (35%), C&L Packaging, Inc. (27%)                                                                                                                                           
|1247 North Church Street  |  | 1998       |  | 52,790                      |  | 100.0                                   |  | 461                           |  | 460                                |  | 0.09                                                                                 |  | 8.73                                         |  | 8.71                                              |  | Otis Elevator Company (23%), Dilks Agency, Inc. (23%), Telesciences, Inc. (17%), Spot-Coolers, Inc. (14%)                                                                                                                
|1256 North Church Street  |  | 1984       |  | 63,495                      |  | 100.0                                   |  | 365                           |  | 301                                |  | 0.07                                                                                 |  | 5.75                                         |  | 4.74                                              |  | Weiler Labeling Systems, LLC (50%), James C. Anderson Associates (30%), Ketec, Inc. (20%)                                                                                                                                
|840 North Lenola Road     |  | 1995       |  | 38,300                      |  | 69.0                                    |  | 259                           |  | 216                                |  | 0.05                                                                                 |  | 9.80                                         |  | 8.17                                              |  | Millar Elevator Service (31%), Payroll Associates (20%), Innovasystems, Inc. (18%)                                                                                                                                       
|844 North Lenola Road     |  | 1995       |  | 28,670                      |  | 58.6                                    |  | 130                           |  | 124                                |  | 0.03                                                                                 |  | 7.74                                         |  | 7.38                                              |  | Curbell, Inc. (34%), James J. Martin, Inc. (25%)                                                                                                                                                                         
|915 North Lenola Road     |  | 1998       |  | 52,488                      |  | 100.0                                   |  | 271                           |  | 253                                |  | 0.06                                                                                 |  | 5.16                                         |  | 4.82                                              |  | Tropicana Products,Inc. (37%), Vision Realty, LLC (23%), Riley Sales, Inc. (18%), Market Place Advertising, Inc. (13%)                                                                                                   
|2 Twosome Drive           |  | 2000       |  | 48,600                      |  | 100.0                                   |  | 391                           |  | 391                                |  | 0.08                                                                                 |  | 8.05                                         |  | 8.05                                              |  | Sterling Medical Services, LLC (100%)                                                                                                                                                                                    
|30 Twosome Drive          |  | 1997       |  | 39,675                      |  | 100.0                                   |  | 212                           |  | 209                                |  | 0.04                                                                                 |  | 5.34                                         |  | 5.27                                              |  | Hartman Cards, Inc. (28%), Commercial Office Furniture (24%), Aramark Sports Entertainment (14%), The Closet Factory (12%), C&L Packaging, Inc. (12%), Kencomm Communications (10%)                                      
|31 Twosome Drive          |  | 1998       |  | 84,200                      |  | 100.0                                   |  | 438                           |  | 438                                |  | 0.09                                                                                 |  | 5.20                                         |  | 5.20                                              |  | Cort Furniture Rental Corp. (56%), Prism Color Corp. (44%)                                                                                                                                                               
|40 Twosome Drive          |  | 1996       |  | 40,265                      |  | 93.4                                    |  | 267                           |  | 263                                |  | 0.05                                                                                 |  | 7.10                                         |  | 6.99                                              |  | NeighborcareTCI, Inc. (49%), Marconi Communications, Inc. (30%), Bellstar, Inc. (14%)                                                                                                                                   
|41 Twosome Drive          |  | 1998       |  | 43,050                      |  | 100.0                                   |  | 296                           |  | 295                                |  | 0.06                                                                                 |  | 6.88                                         |  | 6.85                                              |  | Kit Industries, Inc. (22%), Momentum Systems, Limited (22%), DIANielsen USA, Inc. (11%), Harrington Robb Company (11%), S&S Specialty Products (11%), Williams Communications (11%), Atlantic Loose Leaf Co., Inc.
(11%)
|50 Twosome Drive          |  | 1997       |  | 34,075                      |  | 100.0                                   |  | 258                           |  | 248                                |  | 0.05                                                                                 |  | 7.57                                         |  | 7.28                                              |  | Sussex Wine Merchants (56%), Wells Fargo Alarm Services (44%)                                                                                                                                                            
|West Deptford             |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                                                                          
|1451 Metropolitan Drive   |  | 1996       |  | 21,600                      |  | 100.0                                   |  | 149                           |  | 149                                |  | 0.03                                                                                 |  | 6.90                                         |  | 6.90                                              |  | Garlock Bearings, Inc. (100%)                                                                                                                                                                                            
|MERCER COUNTY, NEW JERSEY |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     
|Hamilton Township         |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                                                                          
|100 Horizon Drive         |  | 1989       |  | 13,275                      |  | 100.0                                   |  | 193                           |  | 169                                |  | 0.04                                                                                 |  | 14.54                                        |  | 12.73                                             |  | PSEG Energy Technologies, Inc. (100%)                                                                                                                                                                                    

36

---

|Property Location           |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per
Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per
Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                                             
|--------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------
|200 Horizon Drive           |  | 1991       |  | 45,770                      |  | 100.0                                   |  | 584                           |  | 544                                |  | 0.12                                                                                 |  | 12.76                                        |  | 11.89                                             |  | Shaw Facilities, Inc. (100%)                                                                                                                                
|300 Horizon Drive           |  | 1989       |  | 69,780                      |  | 100.0                                   |  | 1,054                         |  | 924                                |  | 0.21                                                                                 |  | 15.10                                        |  | 13.24                                             |  | State of New Jersey/DEP (50%), Lucent Technologies, Inc. (26%), Eplus Technology of PA, Inc. (14%), Stephen Gould of Pennsylvania (10%)                     
|500 Horizon Drive           |  | 1990       |  | 41,205                      |  | 100.0                                   |  | 586                           |  | 554                                |  | 0.12                                                                                 |  | 14.22                                        |  | 13.44                                             |  | Yardville National Bank (42%), Lakeview Child Center, Inc. (19%), New Jersey Builders Assoc. (14%), Diedre Moire Corp. (11%)                                
|MONMOUTH COUNTY, NEW JERSEY |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     
|Wall Township               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                             
|1325 Campus Parkway         |  | 1988       |  | 35,000                      |  | 100.0                                   |  | 466                           |  | 438                                |  | 0.09                                                                                 |  | 13.31                                        |  | 12.51                                             |  | Cisco Systems, Inc. (100%)                                                                                                                                  
|1340 Campus Parkway         |  | 1992       |  | 72,502                      |  | 98.1                                    |  | 880                           |  | 750                                |  | 0.18                                                                                 |  | 12.37                                        |  | 10.54                                             |  | Groundwater & Environmental Services Inc. (33%), GEAC Computers, Inc. (22%), State Farm Mutual Auto Insurance (17%), Association For Retarded Citizens (11%)
|1345 Campus Parkway         |  | 1995       |  | 76,300                      |  | 96.0                                    |  | 608                           |  | 574                                |  | 0.12                                                                                 |  | 8.30                                         |  | 7.84                                              |  | Quadramed Corp. (24%), De Vine Corp. (16%), Medi-Hut Co., Inc. (15%), Woodcliff Academy (15%), System Sales Corporation (12%)                               
|1433 Highway 34             |  | 1985       |  | 69,020                      |  | 65.1                                    |  | 516                           |  | 381                                |  | 0.11                                                                                 |  | 11.48                                        |  | 8.48                                              |  | State Farm Mutual Insurance Co. (48%), Applied Image, Inc. (11%)                                                                                            
|1320 Wyckoff Avenue         |  | 1986       |  | 20,336                      |  | 100.0                                   |  | 176                           |  | 168                                |  | 0.04                                                                                 |  | 8.65                                         |  | 8.26                                              |  | The County of Monmouth (100%)                                                                                                                               
|1324 Wyckoff Avenue         |  | 1987       |  | 21,168                      |  | 100.0                                   |  | 221                           |  | 191                                |  | 0.04                                                                                 |  | 10.44                                        |  | 9.02                                              |  | Blackhawk Management Corp. (53%), Systems Fulfillment (25%), Supply Saver, Inc. (22%)                                                                       
|PASSAIC COUNTY, NEW JERSEY  |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     
|Totowa                      |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                             
|1 Center Court              |  | 1999       |  | 38,961                      |  | 100.0                                   |  | 493                           |  | 358                                |  | 0.10                                                                                 |  | 12.65                                        |  | 9.19                                              |  | Rock-Tenn Converting Company (46%), Eizo Nanao Technologies, Inc. (38%), Onyx Waste Services, Inc. (16%)                                                    
|2 Center Court              |  | 1998       |  | 30,600                      |  | 99.3                                    |  | 348                           |  | 237                                |  | 0.07                                                                                 |  | 11.45                                        |  | 7.80                                              |  | Nomadic Display (36%), Electro Rent Corp. (33%), Alpine Electronics of America (30%)                                                                        
|11 Commerce Way             |  | 1989       |  | 47,025                      |  | 100.0                                   |  | 540                           |  | 470                                |  | 0.11                                                                                 |  | 11.48                                        |  | 9.99                                              |  | Coram Alternative Site Services (56%), Gentiva Health Services (22%), D.A. Kopp & Associates, Inc. (22%)                                                    
|20 Commerce Way             |  | 1992       |  | 42,540                      |  | 75.9                                    |  | 430                           |  | 415                                |  | 0.09                                                                                 |  | 13.32                                        |  | 12.85                                             |  | Lodan Totowa, Inc. F/K/A Emersub (62%), Dish Network Service Corp. (14%)                                                                                    

37

---

|Property Location            |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per
Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per
Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                                                  
|---------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
|29 Commerce Way              |  | 1990       |  | 48,930                      |  | 100.0                                   |  | 524                           |  | 425                                |  | 0.11                                                                                 |  | 10.71                                        |  | 8.69                                              |  | ADT Security Services, Inc. (55%), Patterson Dental Supply, Inc. (23%), Fujitec America, Inc. (22%)                                                              
|40 Commerce Way              |  | 1987       |  | 50,576                      |  | 100.0                                   |  | 596                           |  | 507                                |  | 0.12                                                                                 |  | 11.78                                        |  | 10.02                                             |  | Thales Components Corporation (43%), Intertek Testing Services, Inc. (29%), Imagistics International, Inc. (14%), System 3R USA, Inc. (14%)                      
|45 Commerce Way              |  | 1992       |  | 51,207                      |  | 100.0                                   |  | 509                           |  | 468                                |  | 0.10                                                                                 |  | 9.94                                         |  | 9.14                                              |  | Ericsson, Inc. (52%), Woodward Clyde Consultants (27%), Oakwood Corporate Housing (21%)                                                                          
|60 Commerce Way              |  | 1988       |  | 50,333                      |  | 93.1                                    |  | 532                           |  | 471                                |  | 0.11                                                                                 |  | 11.35                                        |  | 10.05                                             |  | Jen Mar Graphics, Inc. (27%), Dolan & Traynor Building Prod (16%), Prestige Telecom, Ltd. (14%), MDU Communications (USA), Inc. (14%), Bearings, Ltd. (12%)      
|80 Commerce Way              |  | 1996       |  | 22,500                      |  | 100.0                                   |  | 297                           |  | 217                                |  | 0.06                                                                                 |  | 13.20                                        |  | 9.64                                              |  | Learning Stop, LLC (40%), Idexx Veterinary Services (37%), Inter-American Safety Council (12%), Haas Publishing Companies (11%)                                  
|100 Commerce Way             |  | 1996       |  | 24,600                      |  | 100.0                                   |  | 324                           |  | 237                                |  | 0.07                                                                                 |  | 13.17                                        |  | 9.63                                              |  | Geri Script, LLC (34%), Minolta Business Systems, Inc. (34%), CCH Incorporated (32%)                                                                             
|120 Commerce Way             |  | 1994       |  | 9,024                       |  | 100.0                                   |  | 106                           |  | 101                                |  | 0.02                                                                                 |  | 11.75                                        |  | 11.19                                             |  | Senior Care Centers of America (62%), Showa Tool USA, Inc. (19%), Telsource Corporation (19%)                                                                    
|140 Commerce Way             |  | 1994       |  | 26,881                      |  | 99.5                                    |  | 313                           |  | 300                                |  | 0.06                                                                                 |  | 11.70                                        |  | 11.22                                             |  | Universal Hospital Services (36%), Advanced Image Systems, Inc. (25%), Holder Group, Inc. (13%), Alpha Testing Laboratories (13%), Dairygold (12%)               
|                             |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                  
|Total New Jersey Office/Flex |  | 2,277,531  |  | 92.2                        |  | 18,453                                  |  | 16,568                        |  | 3.74                               |  | 8.79                                                                                 |  | 7.89                                         |  |                                                  
|                             |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                  
|WESTCHESTER COUNTY, NEW YORK |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     
|Elmsford                     |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                  
|11 Clearbrook Road           |  | 1974       |  | 31,800                      |  | 100.0                                   |  | 380                           |  | 367                                |  | 0.08                                                                                 |  | 11.95                                        |  | 11.54                                             |  | Eastern Jungle Gym, Inc. (27%), Bright Horizons Children's Center (21%), Phd Products, Inc. (15%), Portables Unlimited, Inc. (14%), TKV Home Textiles, Inc. (14%)
|75 Clearbrook Road           |  | 1990       |  | 32,720                      |  | 100.0                                   |  | 816                           |  | 816                                |  | 0.17                                                                                 |  | 24.94                                        |  | 24.94                                             |  | Evening Out, Inc. (100%)                                                                                                                                         
|125 Clearbrook Road (h)      |  | 2002       |  | 33,000                      |  | 100.0                                   |  | 524                           |  | 434                                |  | 0.11                                                                                 |  | 21.08                                        |  | 17.46                                             |  | ADT Security Services (55%), Ademco Distribution, Inc. (45%)                                                                                                     

38

---

|Property Location       |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per
Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per
Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                                             
|----------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------
|150 Clearbrook Road     |  | 1975       |  | 74,900                      |  | 93.5                                    |  | 1,088                         |  | 1,023                              |  | 0.22                                                                                 |  | 15.54                                        |  | 14.61                                             |  | Sportive Ventures I, LLC (24%), Philips Medical Systems, N.A. (18%), Transwestern Publications (12%)                                                        
|175 Clearbrook Road     |  | 1973       |  | 98,900                      |  | 96.8                                    |  | 1,476                         |  | 1,408                              |  | 0.30                                                                                 |  | 15.42                                        |  | 14.71                                             |  | Nextel of New York, Inc. (35%), Hypres, Inc. (15%)                                                                                                          
|200 Clearbrook Road     |  | 1974       |  | 94,000                      |  | 99.8                                    |  | 1,188                         |  | 1,114                              |  | 0.24                                                                                 |  | 12.66                                        |  | 11.87                                             |  | Brunschwig & Fils, Inc. (39%), Proftech Corp. (20%)                                                                                                         
|250 Clearbrook Road     |  | 1973       |  | 155,000                     |  | 95.1                                    |  | 1,358                         |  | 1,285                              |  | 0.28                                                                                 |  | 9.21                                         |  | 8.72                                              |  | AFP Imaging Corp. (31%), The Artina Group, Inc. (14%), Prints Plus, Inc. (13%), Conri Services, Inc. (13%)                                                  
|50 Executive Boulevard  |  | 1969       |  | 45,200                      |  | 97.6                                    |  | 360                           |  | 350                                |  | 0.07                                                                                 |  | 8.16                                         |  | 7.93                                              |  | MMO Music Group (55%), Board of Cooperative Ed (22%)                                                                                                        
|77 Executive Boulevard  |  | 1977       |  | 13,000                      |  | 100.0                                   |  | 210                           |  | 200                                |  | 0.04                                                                                 |  | 16.15                                        |  | 15.38                                             |  | Bright Horizons Children Center (55%), Richmonds Childrens Center, Inc. (45%)                                                                               
|85 Executive Boulevard  |  | 1968       |  | 31,000                      |  | 99.4                                    |  | 463                           |  | 456                                |  | 0.09                                                                                 |  | 15.03                                        |  | 14.80                                             |  | VREX, Inc. (49%), Westhab, Inc. (32%), Wald Optics Laboratory, Inc. (13%)                                                                                   
|300 Executive Boulevard |  | 1970       |  | 60,000                      |  | 100.0                                   |  | 552                           |  | 525                                |  | 0.11                                                                                 |  | 9.20                                         |  | 8.75                                              |  | Princeton Ski Outlet Corp. (69%), Publishers Circulation Fulfil (31%)                                                                                       
|350 Executive Boulevard |  | 1970       |  | 15,400                      |  | 98.8                                    |  | 296                           |  | 277                                |  | 0.06                                                                                 |  | 19.45                                        |  | 18.21                                             |  | Fujitsu Network Communication (99%)                                                                                                                         
|399 Executive Boulevard |  | 1962       |  | 80,000                      |  | 100.0                                   |  | 1,017                         |  | 975                                |  | 0.21                                                                                 |  | 12.71                                        |  | 12.19                                             |  | American Banknote Holographic (72%), Game Sportswear, Ltd (28%)                                                                                             
|400 Executive Boulevard |  | 1970       |  | 42,200                      |  | 100.0                                   |  | 652                           |  | 599                                |  | 0.13                                                                                 |  | 15.45                                        |  | 14.19                                             |  | Baker Engineering NY, Inc. (39%), Ultra Fabrics, Inc. (30%)                                                                                                 
|500 Executive Boulevard |  | 1970       |  | 41,600                      |  | 100.0                                   |  | 685                           |  | 624                                |  | 0.14                                                                                 |  | 16.47                                        |  | 15.00                                             |  | Singer Holding Corporation (36%), Thyssen Krupp Elevator Corp. (16%), Cintas Corporation (16%), Olympia Sports, Inc. (13%), Pharmacare Resources, Inc. (13%)
|525 Executive Boulevard |  | 1972       |  | 61,700                      |  | 100.0                                   |  | 903                           |  | 862                                |  | 0.18                                                                                 |  | 14.64                                        |  | 13.97                                             |  | Vie De France Yamazaki, Inc. (40%), New York Blood Center, Inc. (27%)                                                                                       
|1 Westchester Plaza     |  | 1967       |  | 25,000                      |  | 100.0                                   |  | 308                           |  | 289                                |  | 0.06                                                                                 |  | 12.32                                        |  | 11.56                                             |  | British Apparel (40%), Thin Film Concepts, Inc. (20%), RS Knapp (20%), JT Lynne Representatives (20%)                                                       
|2 Westchester Plaza     |  | 1968       |  | 25,000                      |  | 100.0                                   |  | 473                           |  | 464                                |  | 0.10                                                                                 |  | 18.92                                        |  | 18.56                                             |  | Board of Cooperative Education (80%), Kin-Tronics (10%), Squires Productions, Inc. (10%)                                                                    
|3 Westchester Plaza     |  | 1969       |  | 93,500                      |  | 94.6                                    |  | 1,277                         |  | 1,241                              |  | 0.26                                                                                 |  | 14.44                                        |  | 14.03                                             |  | Reveo, Inc. (51%), Fabrication Enterprises, Inc. (22%), Aramak Uniform & Career Apparel (17%)                                                               

39

---

|Property Location       |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per
Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per
Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                       
|----------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------
|4 Westchester Plaza     |  | 1969       |  | 44,700                      |  | 99.8                                    |  | 636                           |  | 600                                |  | 0.13                                                                                 |  | 14.26                                        |  | 13.45                                             |  | Metropolitan Life Insurance (38%), E2V Technologies, Inc. (34%), Infovalue Computing, Inc. (13%)                                      
|5 Westchester Plaza     |  | 1969       |  | 20,000                      |  | 77.1                                    |  | 325                           |  | 291                                |  | 0.07                                                                                 |  | 21.08                                        |  | 18.87                                             |  | Apria Healthcare, Inc. (39%), Rokonet Industries USA, Inc. (14%), BBA Project, Inc. (13%), United States Beef Purveyors (12%)         
|6 Westchester Plaza     |  | 1968       |  | 20,000                      |  | 100.0                                   |  | 314                           |  | 292                                |  | 0.06                                                                                 |  | 15.70                                        |  | 14.60                                             |  | Pinkerton Systems Integration (28%), Xerox Corporation (28%), Game Parts, Inc. (24%), Girard Rubber Co. (13%)                         
|7 Westchester Plaza     |  | 1972       |  | 46,200                      |  | 100.0                                   |  | 656                           |  | 651                                |  | 0.13                                                                                 |  | 14.20                                        |  | 14.09                                             |  | Emigrant Savings Bank (69%), Fire End Croker Corp. (27%)                                                                              
|8 Westchester Plaza     |  | 1971       |  | 67,200                      |  | 96.6                                    |  | 919                           |  | 805                                |  | 0.19                                                                                 |  | 14.16                                        |  | 12.40                                             |  | Mamiya America Corp. (24%), Ciba Specialty Chemicals Corp. (17%), Kubra Data Transfer, Ltd. (15%)                                     
|Hawthorne               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                       
|200 Saw Mill River Road |  | 1965       |  | 51,100                      |  | 97.8                                    |  | 646                           |  | 621                                |  | 0.13                                                                                 |  | 12.93                                        |  | 12.43                                             |  | Walter DeGruyter, Inc. (21%), Team Roselli Corporation (20%), Northeast Battery & Alternators (17%), Cablevision Lightpath, Inc. (12%)
|4 Skyline Drive         |  | 1987       |  | 80,600                      |  | 100.0                                   |  | 1,379                         |  | 1,328                              |  | 0.28                                                                                 |  | 17.11                                        |  | 16.48                                             |  | Alstom USA, Inc. (27%), Evonyx, Inc. (23%), All Star Marketing Group, LLC (11%)                                                       
|5 Skyline Drive         |  | 1980       |  | 124,022                     |  | 100.0                                   |  | 1,615                         |  | 1,615                              |  | 0.33                                                                                 |  | 13.02                                        |  | 13.02                                             |  | Taro Pharmaceuticals USA, Inc. (75%), Westco Closet Corp. (20%)                                                                       
|6 Skyline Drive         |  | 1980       |  | 44,155                      |  | 100.0                                   |  | 718                           |  | 718                                |  | 0.15                                                                                 |  | 16.26                                        |  | 16.26                                             |  | Evonyx, Inc. (73%), Anvik Corporation (27%)                                                                                           
|8 Skyline Drive         |  | 1985       |  | 50,000                      |  | 98.7                                    |  | 842                           |  | 683                                |  | 0.17                                                                                 |  | 17.06                                        |  | 13.84                                             |  | Ameriquest Mortgage Company (51%), Evonyx, Inc. (29%), Minolta Business Solutions, Inc. (20%)                                         
|10 Skyline Drive        |  | 1985       |  | 20,000                      |  | 68.5                                    |  | 233                           |  | 212                                |  | 0.05                                                                                 |  | 17.01                                        |  | 15.47                                             |  | Bi-Tronic Inc/LCA Sales Corp. (51%), ENSR Corp. (17%)                                                                                 
|11 Skyline Drive        |  | 1989       |  | 45,000                      |  | 100.0                                   |  | 746                           |  | 696                                |  | 0.15                                                                                 |  | 16.58                                        |  | 15.47                                             |  | Xand Corporation (100%)                                                                                                               
|12 Skyline Drive        |  | 1999       |  | 46,850                      |  | 100.0                                   |  | 806                           |  | 634                                |  | 0.16                                                                                 |  | 17.20                                        |  | 13.53                                             |  | Creative Visual Enterprises (38%), Medelec, Inc. (32%), Savin Corporation (30%)                                                       
|15 Skyline Drive        |  | 1989       |  | 55,000                      |  | 100.0                                   |  | 1,122                         |  | 938                                |  | 0.23                                                                                 |  | 20.40                                        |  | 17.05                                             |  | Accorda Therapeutics, Inc. (54%), Tellabs Operations, Inc. (46%)                                                                      

40

---

|Property Location             |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage
of Total 2002
Office,
Office/Flex
and Industrial/
Warehouse
Base Rent (%) |  | 2002
Average
Base Rent
Per
Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per
Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                                                                                 
|----------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ------------------------------------------------------------------------------------ |  | -------------------------------------------- |  | ------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
|Yonkers                       |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                 
|100 Corporate Boulevard       |  | 1987       |  | 78,000                      |  | 98.2                                    |  | 1,416                         |  | 1,338                              |  | 0.29                                                                                 |  | 18.49                                        |  | 17.47                                             |  | Montefiore Medical Center (28%), Sempra Energy Trading Corp. (13%), Emerging Health Information (12%), Genzyme Genetics Corp. (11%), Otis Elevator Company (11%)
|200 Corporate Boulevard South |  | 1990       |  | 84,000                      |  | 92.5                                    |  | 1,331                         |  | 1,301                              |  | 0.27                                                                                 |  | 17.13                                        |  | 16.74                                             |  | Belmay, Inc. (32%), Montefiore Medical Center (23%), Advanced Viral Research Corp. (20%)                                                                        
|4 Executive Plaza             |  | 1986       |  | 80,000                      |  | 99.0                                    |  | 1,253                         |  | 1,124                              |  | 0.26                                                                                 |  | 15.82                                        |  | 14.19                                             |  | Wise Contact US Optical Corp. (35%), E&B Giftware, Inc. (22%), TT Systems, LLC (10%)                                                                            
|6 Executive Plaza             |  | 1987       |  | 80,000                      |  | 95.8                                    |  | 1,276                         |  | 1,249                              |  | 0.26                                                                                 |  | 16.65                                        |  | 16.30                                             |  | CSC Holdings, Inc. (52%), Atlantic Bank of NY (11%)                                                                                                             
|1 Odell Plaza                 |  | 1980       |  | 106,000                     |  | 99.9                                    |  | 1,365                         |  | 1,308                              |  | 0.28                                                                                 |  | 12.89                                        |  | 12.35                                             |  | Sportive Ventures 2, LLC (19%), Market Dynamics Group, LLC (11%)                                                                                                
|5 Odell Plaza                 |  | 1983       |  | 38,400                      |  | 99.6                                    |  | 625                           |  | 601                                |  | 0.13                                                                                 |  | 16.34                                        |  | 15.71                                             |  | Voyetra Technologies, Inc. (44%), Photo File, Inc. (34%), The New Geri Care of Yonkers (22%)                                                                    
|7 Odell Plaza                 |  | 1984       |  | 42,600                      |  | 99.6                                    |  | 652                           |  | 645                                |  | 0.13                                                                                 |  | 15.37                                        |  | 15.20                                             |  | US Postal Service (41%), TT Systems Company (24%), Bright Horizons Childrens Center (16%)                                                                       
|                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                 
|Total New York Office/Flex    |  | 2,277,747  |  | 97.8                        |  | 32,901                                  |  | 30,959                        |  | 6.70                               |  | 14.84                                                                                |  | 13.96                                        |  |                                                  
|                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                 
|FAIRFIELD COUNTY, CONNECTICUT |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     
|Stamford                      |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                 
|419 West Avenue               |  | 1986       |  | 88,000                      |  | 100.0                                   |  | 1,154                         |  | 1,098                              |  | 0.23                                                                                 |  | 13.11                                        |  | 12.48                                             |  | Fuji Medical Systems USA, Inc. (100%)                                                                                                                           
|500 West Avenue               |  | 1988       |  | 25,000                      |  | 100.0                                   |  | 407                           |  | 351                                |  | 0.08                                                                                 |  | 16.28                                        |  | 14.04                                             |  | American Diagnostica, Inc. (43%), Lead Trackers, Inc. (28%), Leadmasters, Inc. (19%), M Cohen and Sons Inc. (11%)                                               
|550 West Avenue               |  | 1990       |  | 54,000                      |  | 100.0                                   |  | 916                           |  | 868                                |  | 0.19                                                                                 |  | 16.96                                        |  | 16.07                                             |  | Lifecodes Corp. (68%), Davidoff of Geneva (CT), Inc. (32%)                                                                                                      
|600 West Avenue               |  | 1999       |  | 66,000                      |  | 100.0                                   |  | 826                           |  | 795                                |  | 0.17                                                                                 |  | 12.52                                        |  | 12.05                                             |  | P.Kaufmann, Inc. (100%)                                                                                                                                         
|650 West Avenue               |  | 1998       |  | 40,000                      |  | 100.0                                   |  | 922                           |  | 792                                |  | 0.19                                                                                 |  | 23.05                                        |  | 19.80                                             |  | Davidoff of Geneva (CT), Inc. (100%)                                                                                                                            
|                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                 
|Total Connecticut Office/Flex |  | 273,000    |  | 100.0                       |  | 4,225                                   |  | 3,904                         |  | 0.86                               |  | 15.48                                                                                |  | 14.30                                        |  |                                                  
|                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                 
|TOTAL OFFICE/FLEX PROPERTIES  |  | 4,828,278  |  | 95.3                        |  | 55,579                                  |  | 51,431                        |  | 11.30                              |  | 12.12                                                                                |  | 11.21                                        |  |                                                  
|                              |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                      |  |                                              |  |                                                   |  |                                                                                                                                                                 

41

---

Property Listing

Industrial/Warehouse Properties

|Property Location                                              |  | Year
Built |  | Net
Rentable
Area
(Sq. Ft.) |  | Percentage
Leased
as of
12/31/02
(%)(a) |  | 2002
Base
Rent
($000's)(b)(c) |  | 2002
Effective
Rent
($000's)(c)(d) |  | Percentage of Total 2002 Office, Office/Flex and Industrial/Warehouse Base Rent (%) |  | 2002
Average
Base Rent
Per
Sq. Ft.
($)(c)(e) |  | 2002
Average
Effective
Rent
Per
Sq. Ft.
($)(c)(f) |  | Tenants Leasing 10% or
More of Net Rentable
Area Per Property
as of 12/31/02(c)                              
|-------------------------------------------------------------- |  | ---------- |  | --------------------------- |  | --------------------------------------- |  | ----------------------------- |  | ---------------------------------- |  | ----------------------------------------------------------------------------------- |  | -------------------------------------------- |  | ------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------
|WESTCHESTER COUNTY, NEW YORK                                   |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                    
|Elmsford                                                       |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                              
|1 Warehouse Lane                                               |  | 1957       |  | 6,600                       |  | 100.0                                   |  | 72                            |  | 72                                 |  | 0.01                                                                                |  | 10.91                                        |  | 10.91                                             |  | JP Trucking Service Center, Inc. (100%)                                                                      
|2 Warehouse Lane                                               |  | 1957       |  | 10,900                      |  | 96.3                                    |  | 64                            |  | 53                                 |  | 0.01                                                                                |  | 6.10                                         |  | 5.05                                              |  | Fit Snacks, LLC. (55%), Teleport Communications Group (41%)                                                  
|3 Warehouse Lane                                               |  | 1957       |  | 77,200                      |  | 100.0                                   |  | 290                           |  | 279                                |  | 0.06                                                                                |  | 3.76                                         |  | 3.61                                              |  | United Parcel Service (100%)                                                                                 
|4 Warehouse Lane                                               |  | 1957       |  | 195,500                     |  | 100.0                                   |  | 1,988                         |  | 1,936                              |  | 0.40                                                                                |  | 10.17                                        |  | 9.90                                              |  | San Mar Laboratories, Inc. (63%), Westinghouse Air Brake Co., Inc. (14%), Bombardier Mass Transit Corp. (11%)
|5 Warehouse Lane                                               |  | 1957       |  | 75,100                      |  | 89.3                                    |  | 810                           |  | 712                                |  | 0.16                                                                                |  | 12.08                                        |  | 10.62                                             |  | Nestle Waters North America (48%), Chamart Exclusives, Inc. (16%), Mallory Kotzen Tire Company (11%)         
|6 Warehouse Lane                                               |  | 1982       |  | 22,100                      |  | 100.0                                   |  | 512                           |  | 510                                |  | 0.10                                                                                |  | 23.17                                        |  | 23.08                                             |  | Conway Central Express (100%)                                                                                
|                                                               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                              
|Total Industrial/Warehouse Properties                          |  | 387,400    |  | 97.8                        |  | 3,736                                   |  | 3,562                         |  | 0.74                               |  | 9.86                                                                                |  | 9.40                                         |  |                                                  
|                                                               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                              
|TOTAL OFFICE, OFFICE/FLEX, AND INDUSTRIAL/WAREHOUSE PROPERTIES |  | 27,091,934 |  | 92.3                        |  | 491,224                                 |  | 458,433                       |  | 100.00                             |  | 20.59                                                                               |  | 19.26                                        |  |                                                  
|                                                               |  |            |  |                             |  |                                         |  |                               |  |                                    |  |                                                                                     |  |                                              |  |                                                   |  |                                                                                                              

---

42

---

Retail Properties

The Operating Partnership owned two stand-alone retail properties as of December 31, 2002, as described below:

The
Operating Partnership owns an 8,000 square foot restaurant, constructed in 1986, located at 2 Executive Plaza in the South Westchester Executive Park in Yonkers, Westchester County,
New York. The restaurant is 100 percent leased to Benni's I LLC for use as a Bennigan's restaurant under a 16-year lease. The lease currently provides for fixed annual base rent of
$175,000, with fully-reimbursed real estate taxes, and operating expenses escalated based on the consumer price index ("CPI") over a base year CPI. The lease, which commenced in December 2001
and expires in December 2017, includes scheduled rent increases in January 2003 to approximately $205,000 annually, in January 2006 to approximately $225,000 annually, in
January 2010 to approximately $248,000 annually, and in January 2014 to approximately $273,000 annually. The lease also provides for additional rent calculated as a percentage of sales
over a specified sales amount, as well as for two five-year renewal options. 2002 total base rent for the property, calculated in accordance with GAAP, was approximately $232,101.

The
Operating Partnership also owns a 9,300 square foot restaurant, constructed in 1984, located at 230 White Plains Road, Tarrytown, Westchester County, New York. The restaurant is
100 percent leased to TGI Friday's under a 10-year lease which provides for fixed annual base rent of approximately $195,000, with fully-reimbursed real estate taxes, and operating
expenses escalated based on CPI over a base year CPI. The lease, which expires in August 2004, also provides for additional rent calculated as a percentage of sales over a specified sales
amount, as well as for four five-year renewal options. 2002 total base rent for the property, calculated in accordance with GAAP, was approximately $195,000.

Land Leases

The Operating Partnership owned three land parcels, which were leased as of December 31, 2002, as described below:

The
Operating Partnership leases land to Star Enterprises, on which a 2,264 square-foot Texaco gas station was constructed, located at 1 Enterprise Boulevard in Yonkers,
Westchester County, New York.
The 15-year, triple-net land lease provides for annual rent of approximately $145,000 and expires in April 2005. The lease also provides for two five-year
renewal options. 2002 total base rent under this lease, calculated in accordance with GAAP, was approximately $143,972.

The
Operating Partnership also leases five acres of land to Rake Realty, on which a 103,500 square-foot office building exists, located at 700 Executive Boulevard, Elmsford,
Westchester County, New York. The 22-year, triple-net land lease provides for fixed annual rent plus a CPI adjustment every five years, and expires in November 2018.
2002 total base rent under this lease, calculated in accordance with GAAP, was approximately $114,276. The lease also provides for several renewal options which could extend the lease term for an
additional 30 years.

The
Operating Partnership also leases 27.7 acres of land to Home Depot, on which a 134,000 square-foot retail store was constructed, located at the Operating Partnership's
Horizon Center Business Park, Hamilton Township, Mercer County, New Jersey. The net lease, which began on February 1, 1999, provides for annual rent of approximately $298,000 through the fifth
year of the lease and fixed annual rent plus a CPI adjustment every five years for the years thereafter and expires in January 2094. 2002 total base rent under this lease, calculated in
accordance with GAAP, was approximately $294,896.

43

---

Multi-Family Residential Property

In 2002, the Operating Partnership sold a multi-family residential property, as described below:

25 Martine Avenue, White Plains, Westchester County, New York:During 2002, the Operating Partnership owned 25 Martine
Avenue, a 124-unit multi-family residential property located in White Plains, Westchester County, New York, which was sold on January 30, 2002. During 2002, the Operating
Partnership recognized approximately $213,161 in total base rent from the property.

OCCUPANCY

The following table sets forth the year-end percentages of square feet leased in the Operating Partnership's stabilized operating Consolidated
Properties for the last five years:

Year ended December 31,

Percentage of
Square Feet Leased (%) (a)2002

92.32001

94.62000

96.81999

96.51998

96.6


---

44

---

SIGNIFICANT TENANTS

The following table sets forth a schedule of the Operating Partnership's 20 largest tenants for the Consolidated Properties as of December 31, 2002, based
upon annualized base rents:

|                                                   |  | Number of
Properties |  | Annualized
Base Rental
Revenue ($) (a) |  | Percentage Of
Operating
Partnership
Annualized Base
Rental Revenue (%) |  | Square
Feet
Leased |  | Percentage
Total Operating
Partnership
Leased Sq. Ft. (%) |  | Year Of
Lease
Expiration |    
|-------------------------------------------------- |  | -------------------- |  | -------------------------------------- |  | ---------------------------------------------------------------------- |  | ------------------ |  | --------------------------------------------------------- |  | ------------------------ | ---
|AT&T Wireless Services                             |  | 2                    |  | 9,856,447                              |  | 2.0                                                                    |  | 395,955            |  | 1.6                                                       |  | 2007                     | (b)
|Donaldson, Lufkin & Jenrette                       |  |                      |  |                                        |  |                                                                        |  |                    |  |                                                           |  |                          |    
|Securities Corp.                                   |  | 1                    |  | 8,382,273                              |  | 1.7                                                                    |  | 271,953            |  | 1.1                                                       |  | 2012                     | (c)
|AT&T Corporation                                   |  | 3                    |  | 7,395,575                              |  | 1.5                                                                    |  | 455,064            |  | 1.9                                                       |  | 2009                     | (d)
|Keystone Mercy Health Plan                         |  | 2                    |  | 7,124,001                              |  | 1.4                                                                    |  | 303,149            |  | 1.2                                                       |  | 2015                     |    
|Prentice-Hall Inc.                                 |  | 1                    |  | 6,744,495                              |  | 1.4                                                                    |  | 474,801            |  | 2.0                                                       |  | 2014                     |    
|IBM Corporation                                    |  | 3                    |  | 6,250,705                              |  | 1.3                                                                    |  | 353,617            |  | 1.5                                                       |  | 2007                     | (e)
|Nabisco Inc.                                       |  | 3                    |  | 6,066,357                              |  | 1.2                                                                    |  | 340,746            |  | 1.4                                                       |  | 2006                     | (f)
|American Institute of Certified Public Accountants |  | 1                    |  | 5,817,181                              |  | 1.2                                                                    |  | 249,768            |  | 1.0                                                       |  | 2012                     |    
|Forest Laboratories Inc.                           |  | 2                    |  | 5,733,035                              |  | 1.2                                                                    |  | 166,405            |  | 0.7                                                       |  | 2017                     | (g)
|Waterhouse Securities, Inc.                        |  | 1                    |  | 5,379,282                              |  | 1.1                                                                    |  | 184,222            |  | 0.8                                                       |  | 2015                     |    
|Toys "R' Us  NJ, Inc.                             |  | 1                    |  | 5,342,672                              |  | 1.1                                                                    |  | 242,518            |  | 1.0                                                       |  | 2012                     |    
|Allstate Insurance Company                         |  | 9                    |  | 5,247,116                              |  | 1.1                                                                    |  | 233,858            |  | 1.0                                                       |  | 2009                     | (h)
|CMP Media Inc.                                     |  | 1                    |  | 4,817,298                              |  | 1.0                                                                    |  | 237,274            |  | 1.0                                                       |  | 2014                     |    
|Winston & Strawn                                   |  | 1                    |  | 4,564,799                              |  | 0.9                                                                    |  | 108,100            |  | 0.4                                                       |  | 2005                     |    
|National Financial Services                        |  | 1                    |  | 4,346,765                              |  | 0.9                                                                    |  | 112,964            |  | 0.5                                                       |  | 2012                     |    
|Dean Witter Trust Company                          |  | 1                    |  | 4,319,508                              |  | 0.9                                                                    |  | 221,019            |  | 0.9                                                       |  | 2008                     |    
|Morgan Stanley Dean Witter, Inc.                   |  | 5                    |  | 4,124,719                              |  | 0.8                                                                    |  | 163,253            |  | 0.7                                                       |  | 2010                     | (i)
|Move.com Operations, Inc.                          |  | 1                    |  | 3,986,514                              |  | 0.8                                                                    |  | 94,917             |  | 0.4                                                       |  | 2006                     |    
|Garban LLC                                         |  | 1                    |  | 3,848,834                              |  | 0.8                                                                    |  | 135,077            |  | 0.5                                                       |  | 2017                     |    
|KPMG, LLP                                          |  | 2                    |  | 3,604,132                              |  | 0.7                                                                    |  | 134,585            |  | 0.6                                                       |  | 2012                     | (j)
|                                                   |  |                      |  |                                        |  |                                                                        |  |                    |  |                                                           |  |                          |    
|Totals                                             |  |                      |  | 112,951,708                            |  | 23.0                                                                   |  | 4,879,245          |  | 20.2                                                      |  |                          |    
|                                                   |  |                      |  |                                        |  |                                                                        |  |                    |  |                                                           |  |                          |    
|Total Operating Partnership                        |  |                      |  | 491,216,575                            |  |                                                                        |  | 24,165,483         |  |                                                           |  |                          |    
|                                                   |  |                      |  |                                        |  |                                                                        |  |                    |  |                                                           |  |                          |    

---

45

---

SCHEDULE OF LEASE EXPIRATIONS

The following table sets forth a schedule of lease expirations for the total of the Operating Partnership's office, office/flex, industrial/warehouse and
stand-alone retail properties, included in the Consolidated Properties, beginning January 1, 2003, assuming that none of the tenants exercise renewal options:

|Year Of
Expiration      |  | Number Of
Leases
Expiring (a) |  | Net Rentable
Area Subject
To Expiring
Leases
(Sq. Ft.) |     | Percentage Of
Total Leased
Square Feet
Represented By
Expiring
Leases(%)(b) |  | Annualized
Base Rental
Revenue Under
Expiring
Leases($)(c)(d) |  | Average Annual
Rent Per Net
Rentable
Square Foot
Represented
By Expiring
Leases ($) |  | Percentage Of
Annual Base
Rent Under
Expiring
Leases (%)
|----------------------- |  | ----------------------------- |  | ------------------------------------------------------ | --- | --------------------------------------------------------------------------- |  | ------------------------------------------------------------- |  | ----------------------------------------------------------------------------------- |  | --------------------------------------------------------
|2003                    |  | 389                           |  | 2,008,423                                              |     | 8.3                                                                         |  | 37,447,334                                                    |  | 18.65                                                                               |  | 7.6                                                     
|2004                    |  | 373                           |  | 2,450,789                                              |     | 10.1                                                                        |  | 47,324,713                                                    |  | 19.31                                                                               |  | 9.6                                                     
|2005                    |  | 428                           |  | 3,355,492                                              |     | 13.9                                                                        |  | 63,241,145                                                    |  | 18.85                                                                               |  | 12.9                                                    
|2006                    |  | 342                           |  | 2,880,818                                              |     | 11.9                                                                        |  | 59,335,987                                                    |  | 20.60                                                                               |  | 12.1                                                    
|2007                    |  | 304                           |  | 2,512,953                                              |     | 10.4                                                                        |  | 54,323,870                                                    |  | 21.62                                                                               |  | 11.0                                                    
|2008                    |  | 182                           |  | 2,304,298                                              |     | 9.5                                                                         |  | 42,402,909                                                    |  | 18.40                                                                               |  | 8.6                                                     
|2009                    |  | 94                            |  | 1,561,127                                              |     | 6.5                                                                         |  | 29,037,436                                                    |  | 18.60                                                                               |  | 5.9                                                     
|2010                    |  | 103                           |  | 1,293,024                                              |     | 5.4                                                                         |  | 26,285,928                                                    |  | 20.33                                                                               |  | 5.4                                                     
|2011                    |  | 77                            |  | 1,496,992                                              |     | 6.2                                                                         |  | 35,714,480                                                    |  | 23.86                                                                               |  | 7.3                                                     
|2012                    |  | 59                            |  | 1,549,113                                              |     | 6.4                                                                         |  | 35,863,612                                                    |  | 23.15                                                                               |  | 7.3                                                     
|2013                    |  | 41                            |  | 769,718                                                |     | 3.2                                                                         |  | 15,477,689                                                    |  | 20.11                                                                               |  | 3.2                                                     
|2014 and thereafter     |  | 37                            |  | 1,982,736                                              |     | 8.2                                                                         |  | 44,761,472                                                    |  | 22.58                                                                               |  | 9.1                                                     
|                        |  |                               |  |                                                        |     |                                                                             |  |                                                               |  |                                                                                     |  |                                                         
|Totals/Weighted Average |  | 2,429                         |  | 24,165,483                                             | (e) | 100.0                                                                       |  | 491,216,575                                                   |  | 20.33                                                                               |  | 100.0                                                   
|                        |  |                               |  |                                                        |     |                                                                             |  |                                                               |  |                                                                                     |  |                                                         

---

|                                                                                                                                                                      |  | Square Feet
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------
|Square footage leased to commercial tenants                                                                                                                           |  | 24,165,483 
|Square footage used for corporate offices, management offices, building use, retail tenants, food services, other ancillary service tenants and occupancy adjustments |  | 526,817    
|Square footage unleased                                                                                                                                               |  | 2,416,934  
|                                                                                                                                                                      |  |            
|Total net rentable square footage (does not include residential, land lease, retail or not-in-service properties)                                                     |  | 27,109,234 
|                                                                                                                                                                      |  |            

46

---

SCHEDULE OF LEASE EXPIRATIONS: OFFICE PROPERTIES

The following table sets forth a schedule of lease expirations for the office properties beginning January 1, 2003, assuming that none of the tenants
exercise renewal options:

|Year Of
Expiration      |  | Number Of
Leases
Expiring(a) |  | Net Rentable
Area Subject
To Expiring
Leases
(Sq. Ft.) |  | Percentage Of
Total Leased
Square Feet
Represented By
Expiring
Leases (%)(b) |  | Annualized
Base Rental
Revenue Under
Expiring
Leases ($)(c)(d) |  | Average Annual
Rent Per Net
Rentable
Square Foot
Represented
By Expiring
Leases ($) |  | Percentage Of
Annual Base
Rent Under
Expiring
Leases (%)
|----------------------- |  | ---------------------------- |  | ------------------------------------------------------ |  | ---------------------------------------------------------------------------- |  | -------------------------------------------------------------- |  | ----------------------------------------------------------------------------------- |  | --------------------------------------------------------
|2003                    |  | 323                          |  | 1,503,824                                              |  | 7.8                                                                          |  | 32,301,485                                                     |  | 21.48                                                                               |  | 7.5                                                     
|2004                    |  | 306                          |  | 1,842,692                                              |  | 9.6                                                                          |  | 40,207,888                                                     |  | 21.82                                                                               |  | 9.3                                                     
|2005                    |  | 323                          |  | 2,496,059                                              |  | 13.0                                                                         |  | 53,271,114                                                     |  | 21.34                                                                               |  | 12.4                                                    
|2006                    |  | 290                          |  | 2,388,191                                              |  | 12.4                                                                         |  | 52,842,357                                                     |  | 22.13                                                                               |  | 12.3                                                    
|2007                    |  | 241                          |  | 1,906,566                                              |  | 9.9                                                                          |  | 46,669,470                                                     |  | 24.48                                                                               |  | 10.8                                                    
|2008                    |  | 141                          |  | 1,729,372                                              |  | 9.0                                                                          |  | 37,080,717                                                     |  | 21.44                                                                               |  | 8.6                                                     
|2009                    |  | 69                           |  | 1,280,374                                              |  | 6.7                                                                          |  | 25,618,284                                                     |  | 20.01                                                                               |  | 5.9                                                     
|2010                    |  | 78                           |  | 935,810                                                |  | 4.9                                                                          |  | 20,671,863                                                     |  | 22.09                                                                               |  | 4.8                                                     
|2011                    |  | 63                           |  | 1,288,363                                              |  | 6.7                                                                          |  | 32,785,685                                                     |  | 25.45                                                                               |  | 7.6                                                     
|2012                    |  | 45                           |  | 1,373,146                                              |  | 7.2                                                                          |  | 33,363,903                                                     |  | 24.30                                                                               |  | 7.7                                                     
|2013                    |  | 28                           |  | 637,458                                                |  | 3.3                                                                          |  | 13,824,173                                                     |  | 21.69                                                                               |  | 3.2                                                     
|2014 and thereafter     |  | 26                           |  | 1,810,223                                              |  | 9.5                                                                          |  | 42,226,056                                                     |  | 23.33                                                                               |  | 9.9                                                     
|                        |  |                              |  |                                                        |  |                                                                              |  |                                                                |  |                                                                                     |  |                                                         
|Totals/Weighted Average |  | 1,933                        |  | 19,192,078                                             |  | 100.0                                                                        |  | 430,862,995                                                    |  | 22.45                                                                               |  | 100.0                                                   
|                        |  |                              |  |                                                        |  |                                                                              |  |                                                                |  |                                                                                     |  |                                                         

---

47

---

SCHEDULE OF LEASE EXPIRATIONS: OFFICE/FLEX PROPERTIES

The following table sets forth a schedule of lease expirations for the office/flex properties beginning January 1, 2003, assuming that none of the tenants
exercise renewal options:

|Year Of
Expiration      |  | Number Of
Leases
Expiring(a) |  | Net Rentable
Area Subject
To Expiring
Leases
(Sq. Ft.) |  | Percentage Of
Total Leased
Square Feet
Represented By
Expiring
Leases (%)(b) |  | Annualized
Base Rental
Revenue Under
Expiring
Leases ($)(c) |  | Average Annual
Rent Per Net
Rentable
Square Foot
Represented
By Expiring
Leases ($) |  | Percentage Of
Annual Base
Rent Under
Expiring
Leases (%)
|----------------------- |  | ---------------------------- |  | ------------------------------------------------------ |  | ---------------------------------------------------------------------------- |  | ----------------------------------------------------------- |  | ----------------------------------------------------------------------------------- |  | --------------------------------------------------------
|2003                    |  | 65                           |  | 496,323                                                |  | 10.8                                                                         |  | 5,069,710                                                   |  | 10.21                                                                               |  | 9.0                                                     
|2004                    |  | 59                           |  | 415,277                                                |  | 9.1                                                                          |  | 4,789,505                                                   |  | 11.53                                                                               |  | 8.5                                                     
|2005                    |  | 102                          |  | 837,505                                                |  | 18.3                                                                         |  | 9,762,248                                                   |  | 11.66                                                                               |  | 17.4                                                    
|2006                    |  | 52                           |  | 492,627                                                |  | 10.8                                                                         |  | 6,493,630                                                   |  | 13.18                                                                               |  | 11.6                                                    
|2007                    |  | 59                           |  | 591,087                                                |  | 12.9                                                                         |  | 7,447,650                                                   |  | 12.60                                                                               |  | 13.3                                                    
|2008                    |  | 40                           |  | 497,723                                                |  | 10.9                                                                         |  | 5,032,529                                                   |  | 10.11                                                                               |  | 9.0                                                     
|2009                    |  | 23                           |  | 262,958                                                |  | 5.7                                                                          |  | 3,241,012                                                   |  | 12.33                                                                               |  | 5.8                                                     
|2010                    |  | 25                           |  | 357,214                                                |  | 7.8                                                                          |  | 5,614,065                                                   |  | 15.72                                                                               |  | 10.0                                                    
|2011                    |  | 14                           |  | 208,629                                                |  | 4.6                                                                          |  | 2,928,795                                                   |  | 14.04                                                                               |  | 5.2                                                     
|2012                    |  | 14                           |  | 175,967                                                |  | 3.8                                                                          |  | 2,499,709                                                   |  | 14.21                                                                               |  | 4.4                                                     
|2013                    |  | 6                            |  | 77,024                                                 |  | 1.7                                                                          |  | 994,845                                                     |  | 12.92                                                                               |  | 1.8                                                     
|2014 and thereafter     |  | 10                           |  | 164,513                                                |  | 3.6                                                                          |  | 2,330,416                                                   |  | 14.17                                                                               |  | 4.0                                                     
|                        |  |                              |  |                                                        |  |                                                                              |  |                                                             |  |                                                                                     |  |                                                         
|Totals/Weighted
Average |  | 469                          |  | 4,576,847                                              |  | 100.0                                                                        |  | 56,204,114                                                  |  | 12.28                                                                               |  | 100.0                                                   
|                        |  |                              |  |                                                        |  |                                                                              |  |                                                             |  |                                                                                     |  |                                                         

---

48

---

SCHEDULE OF LEASE EXPIRATIONS: INDUSTRIAL/WAREHOUSE PROPERTIES

The following table sets forth a schedule of lease expirations for the industrial/warehouse properties beginning January 1, 2003, assuming that none of the
tenants exercise renewal options:

|Year Of
Expiration      |  | Number Of
Leases
Expiring (a) |  | Net Rentable
Area Subject
To Expiring
Leases
(Sq. Ft.) |  | Percentage Of
Total Leased
Square Feet
Represented By
Expiring
Leases(%)(b) |  | Annualized
Base Rental
Revenue Under
Expiring
Leases($)(c) |  | Average Annual
Rent Per Net
Rentable
Square Foot
Represented
By Expiring
Leases ($) |  | Percentage Of
Annual Base
Rent Under
Expiring
Leases (%)
|----------------------- |  | ----------------------------- |  | ------------------------------------------------------ |  | --------------------------------------------------------------------------- |  | ---------------------------------------------------------- |  | ----------------------------------------------------------------------------------- |  | --------------------------------------------------------
|2003                    |  | 1                             |  | 8,276                                                  |  | 2.2                                                                         |  | 76,139                                                     |  | 9.20                                                                                |  | 2.0                                                     
|2004                    |  | 7                             |  | 183,520                                                |  | 48.4                                                                        |  | 2,132,320                                                  |  | 11.62                                                                               |  | 56.9                                                    
|2005                    |  | 3                             |  | 21,928                                                 |  | 5.8                                                                         |  | 207,783                                                    |  | 9.48                                                                                |  | 5.5                                                     
|2007                    |  | 4                             |  | 15,300                                                 |  | 4.0                                                                         |  | 206,750                                                    |  | 13.51                                                                               |  | 5.5                                                     
|2008                    |  | 1                             |  | 77,203                                                 |  | 20.3                                                                        |  | 289,663                                                    |  | 3.75                                                                                |  | 7.7                                                     
|2009                    |  | 2                             |  | 17,795                                                 |  | 4.7                                                                         |  | 178,140                                                    |  | 10.01                                                                               |  | 4.8                                                     
|2013                    |  | 7                             |  | 55,236                                                 |  | 14.6                                                                        |  | 658,671                                                    |  | 11.92                                                                               |  | 17.6                                                    
|                        |  |                               |  |                                                        |  |                                                                             |  |                                                            |  |                                                                                     |  |                                                         
|Totals/Weighted Average |  | 25                            |  | 379,258                                                |  | 100.0                                                                       |  | 3,749,466                                                  |  | 9.89                                                                                |  | 100.0                                                   
|                        |  |                               |  |                                                        |  |                                                                             |  |                                                            |  |                                                                                     |  |                                                         

---



SCHEDULE OF LEASE EXPIRATIONS: STAND-ALONE RETAIL PROPERTIES

The following table sets forth a schedule of lease expirations for the stand-alone retail properties beginning January 1, 2003, assuming that none of the
tenants exercise renewal options:

|Year Of
Expiration      |  | Number Of
Leases
Expiring (a) |  | Net Rentable
Area Subject
To Expiring
Leases
(Sq. Ft.) |  | Percentage Of
Total Leased
Square Feet
Represented By
Expiring
Leases(%) |  | Annualized
Base Rental
Revenue Under
Expiring
Leases($)(c) |  | Average Annual
Rent Per Net
Rentable
Square Foot
Represented
By Expiring
Leases ($) |  | Percentage Of
Annual Base
Rent Under
Expiring
Leases (%)
|----------------------- |  | ----------------------------- |  | ------------------------------------------------------ |  | ------------------------------------------------------------------------ |  | ---------------------------------------------------------- |  | ----------------------------------------------------------------------------------- |  | --------------------------------------------------------
|2004                    |  | 1                             |  | 9,300                                                  |  | 53.8                                                                     |  | 195,000                                                    |  | 20.97                                                                               |  | 48.8                                                    
|2014 & thereafter       |  | 1                             |  | 8,000                                                  |  | 46.2                                                                     |  | 205,000                                                    |  | 25.63                                                                               |  | 51.2                                                    
|                        |  |                               |  |                                                        |  |                                                                          |  |                                                            |  |                                                                                     |  |                                                         
|Totals/Weighted Average |  | 2                             |  | 17,300                                                 |  | 100.0                                                                    |  | 400,000                                                    |  | 23.12                                                                               |  | 100.0                                                   
|                        |  |                               |  |                                                        |  |                                                                          |  |                                                            |  |                                                                                     |  |                                                         

---



49

---



INDUSTRY DIVERSIFICATION

The following table lists the Operating Partnership's 30 largest industry classifications based on annualized contractual base rent of the Consolidated
Properties:

|Industry Classification(a)                        |  | Annualized
Base Rental
Revenue
($)(b)(c)(d) |  | Percentage Of
Operating Partnership
Annualized Base
Rental Revenue (%) |  | Square
Feet
Leased(e) |  | Percentage Of
Total Operating
Partnership
Leased
Sq. Ft. (%)
|------------------------------------------------- |  | ------------------------------------------- |  | ---------------------------------------------------------------------- |  | --------------------- |  | ------------------------------------------------------------
|Securities, Commodity Contracts & Other Financial |  | 68,648,661                                  |  | 14.0                                                                   |  | 2,555,849             |  | 10.6                                                        
|Manufacturing                                     |  | 47,598,029                                  |  | 9.7                                                                    |  | 2,499,835             |  | 10.3                                                        
|Computer System Design Svcs.                      |  | 30,790,207                                  |  | 6.3                                                                    |  | 1,526,204             |  | 6.3                                                         
|Telecommunications                                |  | 30,345,121                                  |  | 6.2                                                                    |  | 1,536,055             |  | 6.4                                                         
|Insurance Carriers & Related Activities           |  | 27,747,481                                  |  | 5.6                                                                    |  | 1,347,771             |  | 5.6                                                         
|Legal Services                                    |  | 26,253,751                                  |  | 5.3                                                                    |  | 1,043,419             |  | 4.3                                                         
|Health Care & Social Assistance                   |  | 20,117,768                                  |  | 4.1                                                                    |  | 1,058,695             |  | 4.4                                                         
|Credit Intermediation & Related Activities        |  | 20,087,514                                  |  | 4.1                                                                    |  | 1,131,879             |  | 4.7                                                         
|Wholesale Trade                                   |  | 18,492,396                                  |  | 3.8                                                                    |  | 1,242,666             |  | 5.1                                                         
|Scientific Research/Development                   |  | 17,506,370                                  |  | 3.6                                                                    |  | 897,357               |  | 3.7                                                         
|Other Professional                                |  | 16,890,644                                  |  | 3.4                                                                    |  | 858,040               |  | 3.6                                                         
|Accounting/Tax Prep.                              |  | 16,175,416                                  |  | 3.3                                                                    |  | 677,695               |  | 2.8                                                         
|Retail Trade                                      |  | 14,064,664                                  |  | 2.9                                                                    |  | 812,090               |  | 3.4                                                         
|Publishing Industries                             |  | 13,393,055                                  |  | 2.7                                                                    |  | 584,432               |  | 2.4                                                         
|Architectural/Engineering                         |  | 10,277,397                                  |  | 2.1                                                                    |  | 475,445               |  | 2.0                                                         
|Arts, Entertainment & Recreation                  |  | 10,114,652                                  |  | 2.0                                                                    |  | 685,427               |  | 2.8                                                         
|Information Services                              |  | 9,251,411                                   |  | 1.9                                                                    |  | 393,958               |  | 1.6                                                         
|Advertising/Related Services                      |  | 9,248,443                                   |  | 1.9                                                                    |  | 409,911               |  | 1.7                                                         
|Other Services (except Public Administration)     |  | 9,140,019                                   |  | 1.9                                                                    |  | 598,975               |  | 2.5                                                         
|Management of Companies & Finance                 |  | 8,410,140                                   |  | 1.7                                                                    |  | 359,296               |  | 1.5                                                         
|Real Estate & Rental & Leasing                    |  | 7,671,320                                   |  | 1.6                                                                    |  | 429,273               |  | 1.8                                                         
|Transportation                                    |  | 6,733,916                                   |  | 1.4                                                                    |  | 437,583               |  | 1.8                                                         
|Management/Scientific                             |  | 5,898,400                                   |  | 1.2                                                                    |  | 258,984               |  | 1.1                                                         
|Construction                                      |  | 5,754,526                                   |  | 1.2                                                                    |  | 300,149               |  | 1.2                                                         
|Data Processing Services                          |  | 5,614,418                                   |  | 1.1                                                                    |  | 240,571               |  | 1.0                                                         
|Utilities                                         |  | 5,295,530                                   |  | 1.1                                                                    |  | 277,680               |  | 1.1                                                         
|Admin. & Support, Waste Mgt. & Remediation Svc.   |  | 4,633,490                                   |  | 0.9                                                                    |  | 304,111               |  | 1.3                                                         
|Educational Services                              |  | 4,212,218                                   |  | 0.9                                                                    |  | 223,160               |  | 0.9                                                         
|Public Administration                             |  | 3,903,462                                   |  | 0.8                                                                    |  | 189,692               |  | 0.8                                                         
|Specialized Design Services                       |  | 3,662,374                                   |  | 0.7                                                                    |  | 173,699               |  | 0.7                                                         
|Other                                             |  | 13,283,782                                  |  | 2.6                                                                    |  | 635,582               |  | 2.6                                                         
|                                                  |  |                                             |  |                                                                        |  |                       |  |                                                             
|Totals                                            |  | 491,216,575                                 |  | 100.0                                                                  |  | 24,165,483            |  | 100.0                                                       
|                                                  |  |                                             |  |                                                                        |  |                       |  |                                                             

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50

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MARKET DIVERSIFICATION

The following table lists the Operating Partnership's markets (MSAs), based on annualized contractual base rent of the Consolidated
Properties:

|Market (MSA)                                 |  | Annualized
Base Rental
Revenue
($)(a)(b)(c) |  | Percentage Of
Operating Partnership
Annualized Base
Rental Revenue (%) |  | Total
Property Size
Rentable Area |  | Percentage Of
Rentable Area (%)
|-------------------------------------------- |  | ------------------------------------------- |  | ---------------------------------------------------------------------- |  | --------------------------------- |  | -------------------------------
|New York, NY (Westchester-Rockland Counties) |  | 88,521,961                                  |  | 18.0                                                                   |  | 4,973,023                         |  | 18.3                           
|Bergen-Passaic, NJ                           |  | 87,434,564                                  |  | 17.8                                                                   |  | 4,530,091                         |  | 16.7                           
|Newark, NJ (Essex-Morris-Union Counties)     |  | 81,988,124                                  |  | 16.7                                                                   |  | 4,242,330                         |  | 15.7                           
|Jersey City, NJ                              |  | 63,623,449                                  |  | 12.9                                                                   |  | 3,074,470                         |  | 11.3                           
|Philadelphia, PA-NJ                          |  | 47,912,140                                  |  | 9.8                                                                    |  | 3,354,023                         |  | 12.4                           
|Trenton, NJ (Mercer County)                  |  | 15,008,575                                  |  | 3.1                                                                    |  | 767,365                           |  | 2.8                            
|Middlesex-Somerset-Hunterdon, NJ             |  | 14,737,455                                  |  | 3.0                                                                    |  | 791,051                           |  | 2.9                            
|Denver, CO                                   |  | 13,955,447                                  |  | 2.8                                                                    |  | 1,084,945                         |  | 4.0                            
|Stamford-Norwalk, CT                         |  | 13,191,782                                  |  | 2.7                                                                    |  | 706,510                           |  | 2.6                            
|Washington, DC-MD-VA                         |  | 12,999,141                                  |  | 2.6                                                                    |  | 450,549                           |  | 1.7                            
|San Francisco, CA                            |  | 12,320,464                                  |  | 2.5                                                                    |  | 450,891                           |  | 1.7                            
|Monmouth-Ocean, NJ                           |  | 7,445,520                                   |  | 1.5                                                                    |  | 577,423                           |  | 2.1                            
|Dallas, TX                                   |  | 6,518,408                                   |  | 1.3                                                                    |  | 449,594                           |  | 1.7                            
|Nassau-Suffolk, NY                           |  | 6,373,398                                   |  | 1.3                                                                    |  | 292,849                           |  | 1.1                            
|San Antonio, TX                              |  | 5,095,656                                   |  | 1.0                                                                    |  | 435,465                           |  | 1.6                            
|Bridgeport, CT                               |  | 3,257,621                                   |  | 0.7                                                                    |  | 145,487                           |  | 0.5                            
|Colorado Springs, CO                         |  | 2,737,806                                   |  | 0.6                                                                    |  | 209,987                           |  | 0.8                            
|Boulder-Longmont, CO                         |  | 2,634,540                                   |  | 0.5                                                                    |  | 270,421                           |  | 1.0                            
|Dutchess County, NY                          |  | 2,318,687                                   |  | 0.5                                                                    |  | 118,727                           |  | 0.4                            
|Atlantic-Cape May, NJ                        |  | 1,831,576                                   |  | 0.4                                                                    |  | 80,344                            |  | 0.3                            
|Houston, TX                                  |  | 1,310,261                                   |  | 0.3                                                                    |  | 103,689                           |  | 0.4                            
|                                             |  |                                             |  |                                                                        |  |                                   |  |                                
|Totals                                       |  | 491,216,575                                 |  | 100.0                                                                  |  | 27,109,234                        |  | 100.0                          
|                                             |  |                                             |  |                                                                        |  |                                   |  |                                

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51

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ITEM 3. LEGAL PROCEEDINGS

Pursuant to an agreement with the City of Jersey City, New Jersey, the Operating Partnership is required to make payments in lieu of property taxes ("PILOT") on
its Harborside Plaza 2 and 3 properties. The agreement, which commenced in 1990, is for a term of 15 years. Such PILOT is equal to two percent of Total Project Costs, as defined, in year one
and increases by $75,000 per annum through year 15. Total Project Costs, as defined, are $145.6 million. The PILOT totaled $3.8 million, $3.7 million and $3.6 million for
the years ended December 31, 2002, 2001 and 2000, respectively. The PILOT on these two properties has been challenged as part of a larger effort by several neighboring towns to question past
practices of the City of Jersey City in attracting large development. If this challenge is successful, the properties will be placed back on the regular tax roles for tax years beginning with 1998.
While the Operating Partnership cannot at this time determine the likely outcome of this challenge, the effect, if successful, of the challenge on the tax assessments against the properties, or the
amount of the increase, if any, in taxes assessed resulting from a successful challenge, the Operating Partnership does not believe that the outcome will result in a material adverse impact to the
Operating Partnership as there is the potential that the majority of any increase in the expense at the properties may be passed along to the properties' tenants. See Note 16 to the Financial
Statements.

There
are no other material pending legal proceedings, other than ordinary routine litigation incidental to its business, to which the Operating Partnership is a party or to which any of
the Properties is subject.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not
applicable.

52

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PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Operating Partnership currently has no securities listed on any securities exchange.

MARKET INFORMATION

Not
applicable.

HOLDERS

On February 14, 2003, the Operating Partnership had 101 owners of limited partnership units.

RECENT SALES OF UNREGISTERED SECURITIES

The Operating Partnership did not issue any unregistered securities in the years ended December 31, 2002, 2001 or 2000.

DIVIDENDS AND DISTRIBUTIONS

During the year ended December 31, 2002, the Corporation and Operating Partnership declared four quarterly common stock dividends and common unit
distributions in the amounts of $0.62, $0.62, $0.63 and $0.63 per share and common unit from the first to the fourth quarter, respectively.

During
the year ended December 31, 2001, the Corporation and Operating Partnership declared four quarterly common stock dividends and common unit distributions in the amounts of
$0.61, $0.61, $0.62 and $0.62 per share and common unit from the first to the fourth quarter, respectively.

The
declaration and payment of dividends and distributions will continue to be determined by the Board of Directors of the Corporation in light of conditions then existing, including the
Operating Partnership's earnings, financial condition, capital requirements, applicable legal restrictions and other factors.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

The information is incorporated by reference from the Corporation's definitive proxy statement for its annual meeting of shareholders to be held on May 13,
2003.

53

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ITEM 6.    SELECTED FINANCIAL DATA

The following table sets forth selected financial data on a consolidated basis for the Operating Partnership. The consolidated selected operating, balance sheet
and cash flow data of the Operating Partnership as of December 31, 2002, 2001, 2000, 1999 and 1998, and for the years then ended have been derived from financial statements audited by
PricewaterhouseCoopers LLP, independent accountants.

|                                                                                     |  | Year Ended December 31,
|------------------------------------------------------------------------------------ |  | -----------------------
|
|
|Total revenues                                                                       |  | $                      
|Operating and other expenses                                                         |  | $                      
|General and administrative                                                           |  | $                      
|Depreciation and amortization                                                        |  | $                      
|Interest expense                                                                     |  | $                      
|Non-recurring charges                                                                |  | $                      
|Realized gains (losses) and unrealized losses on disposition of rental property, net |  | $                      
|Income before minority interest and extraordinary item                               |  | $                      
|Income before extraordinary item                                                     |  | $                      
|Net income                                                                           |  | $                      
|Net income available to common unitholders                                           |  | $                      
|Basic earnings per unitbefore extraordinary item                                    |  | $                      
|Diluted earnings per unitbefore extraordinary item                                  |  | $                      
|Distributions declared per common unit                                               |  | $                      
|Basic weighted average units outstanding                                             |  |                        
|Diluted weighted average units outstanding                                           |  |                        

|                                                                  |  | December 31,
|----------------------------------------------------------------- |  | ------------
|
|
|Rental property, before accumulated depreciation and amortization |  | $           
|Rental property held for sale, net                                |  | $           
|Total assets                                                      |  | $           
|Total debt                                                        |  | $           
|Total liabilities                                                 |  | $           
|Minority interest                                                 |  | $           
|Partners' capital                                                 |  | $           

|                                                                         |  | Year Ended December 31, |         
|------------------------------------------------------------------------ |  | ----------------------- | --------
|
|
|Cash flows provided by operating activities                              |  | $                       | 220,137 
|Cash flows (used in) provided by investing activities                    |  | $                       | (106,349
|Cash flows (used in) provided by financing activities                    |  | $                       | (125,456
|Funds from operations (1), before distributions to preferred unitholders |  | $                       | 272,288 
|Funds from operations (1), after distributions to preferred unitholders  |  | $                       | 256,632 

---

54

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ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the Consolidated Financial Statements of Mack-Cali Realty, L.P. and subsidiaries and the
notes thereto (collectively, the "Financial Statements"). Certain defined terms used herein have the meaning ascribed to them in the Financial Statements.

Critical Accounting Policies

Rental Property

Rental properties are stated at cost less accumulated depreciation and amortization. Costs directly related to the acquisition, development and construction of
rental properties are capitalized. Capitalized development and construction costs include pre-construction costs essential to the development of the property, development and construction
costs, interest, property taxes, insurance, salaries and other project costs incurred during the period of development. Interest capitalized by the Operating Partnership for the years ended
December 31, 2002, 2001 and 2000 was $4.1 million, $4.0 and $3.7 million, respectively. Ordinary repairs and maintenance are expensed as incurred; major replacements and
betterments, which improve or extend the life of the asset, are capitalized and depreciated over their estimated useful lives. Fully-depreciated assets are removed from the accounts.

The
Operating Partnership considers a construction project as substantially completed and held available for occupancy upon the completion of tenant improvements, but no later than one
year from cessation of major construction activity (as distinguished from activities such as routine maintenance and cleanup). If portions of a rental project are substantially completed and occupied
by tenants, or held available for occupancy, and other portions have not yet reached that stage, the substantially completed portions are accounted for as a separate project. The Operating Partnership
allocates costs incurred between the portions under construction and the portions substantially completed and held available for occupancy and capitalizes only those costs associated with the portion
under construction.

On
a periodic basis, management assesses whether there are any indicators that the value of the Operating Partnership's rental properties may be impaired. A property's value is impaired
only if management's estimate of the aggregate future cash flows (undiscounted and without interest charges)
to be generated by the property are less than the carrying value of the property. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the property
over the fair value of the property. The Operating Partnership's estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions that are
subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property. As these factors
are difficult to predict and are subject to future events that may alter management's assumptions, the future cash flows estimated by management in their impairment analyses may not be achieved.

Rental Property Held for Sale

When assets are identified by management as held for sale, the Operating Partnership discontinues depreciating the assets and estimates the sales price, net of
selling costs, of such assets. If, in management's opinion, the net sales price of the assets which have been identified for sale is less than the net book value of the assets, a valuation allowance
is established.

If
circumstances arise that previously were considered unlikely and, as a result, the Operating Partnership decides not to sell a property previously classified as held for sale, the
property is reclassified as held and used. A property that is reclassified is measured and recorded individually at the lower of (a) its carrying amount before the property was classified as
held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been

55

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continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell. See Note 7 to the Financial Statements.

Effective
January 1, 2002, the Operating Partnership adopted the provisions of Statement of Financial Accounting Standards ("SFAS") No. 144, Accounting for the Impairment
or Disposal of Long-Lived Assets, which supercedes SFAS No. 121. SFAS No. 144 requires that long-lived assets that are to be disposed of by sale be measured at
the lower of book value or fair value less cost to sell. SFAS No. 144 retains the requirements of SFAS No. 121 regarding impairment loss recognition and measurement. In addition, it
requires that one accounting model be used for long-lived assets to be disposed of by sale and broadens the presentation of discontinued operations to include more disposal transactions.
As the statement requires implementation on a prospective basis, properties which were identified as held for sale by the Operating Partnership prior to January 1, 2002 are presented in the
accompanying financial statements in a manner consistent with the prior year's presentation. As there were no additional properties identified as held for sale during the year ended
December 31, 2002, the Operating Partnership did not report any discontinued operations for the periods presented.

Investments in Unconsolidated Joint Ventures

The Operating Partnership accounts for its investments in unconsolidated joint ventures under the equity method of accounting as the Operating Partnership
exercises significant influence, but does not control these entities. These investments are recorded initially at cost, as Investments in Unconsolidated Joint Ventures, and subsequently adjusted for
equity in earnings and cash contributions and distributions.

On
a periodic basis, management assesses whether there are any indicators that the value of the Operating Partnership's investments in unconsolidated joint ventures may be impaired. An
investment is impaired only if management's estimate of the value of the investment is less than the carrying value of the investment. To the extent impairment has occurred, the loss shall be measured
as the excess of the carrying amount of the investment over the value of the investment. See Note 4 to the Financial Statements.

Deferred Leasing Costs

Costs incurred in connection with leases are capitalized and amortized on a straight-line basis over the terms of the related leases and included in
depreciation and amortization. Unamortized deferred leasing costs are charged to amortization expense upon early termination of the lease. Certain employees of the Operating Partnership provide
leasing services to the Properties and receive compensation based on space leased. The portion of such compensation, which is capitalized and amortized, approximated $4.1 million,
$4.0 million and $3.7 million for the years ended December 31, 2002, 2001 and 2000, respectively.

Derivative Instruments

The Operating Partnership measures derivative instruments, including certain derivative instruments embedded in other contracts, at fair value and records them as
an asset or liability, depending on the Operating Partnership's rights or obligations under the applicable derivative contract. For derivatives designated as fair value hedges, the changes in the fair
value of both the derivative instrument and the hedged item are recorded in earnings. For derivatives designated as cash flow hedges, the effective portions of the derivative are reported in other
comprehensive income ("OCI") and are subsequently reclassified into earnings when the hedged item affects earnings. Changes in fair value of derivative instruments not designated as hedging and
ineffective portions of hedges are recognized in earnings in the affected period. See Note 10 to the Financial StatementsInterest Rate Contract.

56

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Revenue Recognition

Base rental revenue is recognized on a straight-line basis over the terms of the respective leases. Unbilled rents receivable represents the amount by
which straight-line rental revenue exceeds rents currently billed in accordance with the lease agreements. Parking and other revenue includes income from parking spaces leased to tenants,
income from tenants for additional services provided by the Operating Partnership, income from tenants for early lease terminations and income from managing properties for third parties. Escalations
and recoveries are received from tenants for certain costs as provided in the lease agreements. These costs generally include real estate taxes, utilities, insurance, common area maintenance and other
recoverable costs. See Note 17 to the Financial Statements.

Allowance for Doubtful Accounts

Management periodically performs a detailed review of amounts due from tenants to determine if accounts receivable balances are impaired based on factors
affecting the collectibility of those balances. Management's estimate of the allowance for doubtful accounts requires management to exercise significant judgment about the timing, frequency and
severity of collection losses, which affects the allowance and net income.

Results from Operations

As a result of the economic climate in 2002, substantially all of the real estate markets the Operating Partnership operates in materially softened. Demand for office space
declined significantly and vacancy rates increased in each of the Operating Partnership's core markets since the first quarter of 2001. Through February 14, 2003, the Operating Partnership's
core markets continued to be weak. The percentage leased in the Operating Partnership's consolidated portfolio of stabilized operating properties decreased to 92.3 percent at
December 31, 2002, as compared to 94.6 percent at December 31, 2001 and 96.8 percent at December 31, 2000. Percentage leased includes all leases in effect as of the
period end date, some of which have commencement dates in the future and leases that expire at the period end date. Market rental rates have declined in most markets from peak levels in late 2000 and
early 2001. Rental rates on the Operating Partnership's space that was re-leased during the year ended December 31, 2002 increased an average of 3.0 percent compared to rates
that were in effect under expiring leases, as compared to a 9.5 percent increase in 2001 and a 12.9 percent increase in 2000. The Operating Partnership believes that vacancy rates may
continue to increase in most of its markets going into 2003.

The
Operating Partnership has a focused strategy geared to attractive opportunities in high-barrier-to-entry markets, primarily predicated on the
Operating Partnership's strong presence in the Northeast region.

Consistent
with its strategy, in the fourth quarter 2000, the Operating Partnership started construction of a 980,000 square-foot office property, known as Plaza 5, at its
Harborside Financial Center office complex in Jersey City, Hudson County, New Jersey. The project, which commenced initial operations in September 2002, is currently projected to cost
approximately $260 million, of which $196.6 million has been incurred by the Operating Partnership through December 31, 2002. Plaza 5 was approximately 58 percent leased as
of December 31, 2002 (which includes a lease with a tenant for 68,000 square feet, or seven percent of the property, for which the tenant has informed the Operating Partnership that it is
experiencing financial difficulties and has failed to meet certain monetary obligations under the lease, including the payment of rent). Additionally, in the fourth quarter 2000, the Operating
Partnership, through a joint venture, started construction of a 577,575 square-foot office property, known as Plaza 10, on land owned by the joint venture located adjacent to the Operating
Partnership's Harborside complex. The Operating Partnership holds a 50 percent interest in the joint venture. Among other things, the joint venture agreement provides for a preferred return on
the Operating Partnership's invested capital in the venture in addition to the Operating Partnership's

57

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proportionate share of the venture's profit, as defined in the agreement. Plaza 10 is currently projected to cost the Operating Partnership approximately $145 million, of which
$124.8 million has been incurred by the Operating Partnership through December 31, 2002. The project, which is 100 percent leased to Charles Schwab & Co. Inc.
("Schwab") for a 15-year term, commenced initial operations in September 2002. The lease agreement with Schwab obligates the venture, among other things, to deliver space to the
tenant by required timelines and offers expansion options at the tenant's election. Such options may obligate the venture to construct an additional building or, at the Operating Partnership's option,
to make space available in any of its existing Harborside properties. Should the venture be unable to, or choose not to, provide such expansion space, the venture would be liable to Schwab for its
actual damages, in no event to exceed $15 million. The amount of Schwab's actual damages, up to $15 million, has been guaranteed by the Operating Partnership. The Operating Partnership
anticipates expending an additional approximately $83.6 million for the completion of Plaza 5 and Plaza 10. The Operating Partnership expects to finance its funding requirements primarily
through drawing on its revolving credit facility.

On
June 6, 2002, the Operating Partnership determined that 20 of its office properties and a land parcel, which are located in Colorado, aggregating 1.6 million square
feet, were no longer being held for sale. The Operating Partnership decided that it would continue to own and operate these properties until market conditions in Colorado improve. The reclassified
properties carried an aggregate book value of $175.6 million, net of accumulated depreciation of $15.8 million and a valuation allowance of $27.0 million at the date of the
subsequent decision not to sell (including an unrealized loss of $3.0 million and catch-up depreciation and amortization expense of $3.9 million for certain properties
reflecting expense for the period from the date the properties were originally held for sale through the date they were no longer held for sale, which was recorded at that date).

On
September 30, 2002, the Operating Partnership determined that its five remaining properties located in Texas were no longer being held for sale. The Operating Partnership
decided that it would continue to own and operate these properties until market conditions in Texas improve and certain leasing uncertainties at the properties are resolved. The reclassified
properties had an aggregate book value of $56.3 million, net of accumulated depreciation of $7.1 million and a valuation allowance of $2.0 million, at the date of the subsequent
decision not to sell (including catch-up depreciation and amortization expense of $3.4 million for certain properties reflecting expense for the period from the date the
properties were originally held for sale through the date they were no longer held for sale, which was recorded at that date).

The
following comparisons for the year ended December 31, 2002 ("2002"), as compared to the year ended December 31, 2001 ("2001"), and for 2001, as compared to the year
ended December 31, 2000 ("2000"), make reference to the following: (i) the effect of the "Same-Store Properties," which represents all in-service properties owned
by the Operating Partnership at December 31, 2000, excluding Dispositions as defined below (for the 2002 versus 2001 comparison) and which represents all in-service properties owned
by the Operating Partnership at December 31, 1999, excluding Dispositions as defined below (for the 2001 versus 2000 comparison); (ii) the effect of the "Acquired Properties," which
represents all properties acquired by the Operating Partnership or commencing initial operations from January 1, 2001 through December 31, 2002 (for the 2002 versus 2001 comparison) and
which represents all properties acquired by the Operating Partnership or commencing initial operations from January 1, 2000 through December 31, 2001 (for the 2001 versus 2000
comparison) and; (iii) the effect of the "Dispositions", which represents results for each period for those rental properties sold by the Operating Partnership during the respective periods.

58

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Year Ended December 31, 2002  Compared to Year Ended December 31, 2001

|                                                                                              |                | Year Ended
December 31 |         |         |   |         |        
|--------------------------------------------------------------------------------------------- | -------------- | ---------------------- | ------- | ------- | - | ------- | -------
|
|
|Revenue from rental operations:                                                               |                |                        |         |         |   |         |        
|Base rents                                                                                    |                | $                      | 492,417 |         | $ | 506,557 |        
|Escalations and recoveries from tenants                                                       |                |                        | 57,057  |         |   | 56,083  |        
|Parking and other                                                                             |                |                        | 17,838  |         |   | 10,518  |        
|                                                                                              |                |                        |         |         |   |         |        
|                                                                                              | Sub-total      |                        |         | 567,312 |   |         | 573,158
|Interest income                                                                               |                |                        | 2,302   |         |   | 2,186   |        
|                                                                                              |                |                        |         |         |   |         |        
|                                                                                              | Total revenues |                        |         | 569,614 |   |         | 575,344
|                                                                                              |                |                        |         |         |   |         |        
|Property expenses:                                                                            |                |                        |         |         |   |         |        
|Real estate taxes                                                                             |                |                        | 60,836  |         |   | 62,015  |        
|Utilities                                                                                     |                |                        | 38,844  |         |   | 43,892  |        
|Operating services                                                                            |                |                        | 68,449  |         |   | 68,779  |        
|                                                                                              |                |                        |         |         |   |         |        
|                                                                                              | Sub-total      |                        |         | 168,129 |   |         | 174,686
|General and administrative                                                                    |                |                        | 27,054  |         |   | 28,490  |        
|Depreciation and amortization                                                                 |                |                        | 109,513 |         |   | 91,471  |        
|Interest expense                                                                              |                |                        | 107,823 |         |   | 112,003 |        
|                                                                                              |                |                        |         |         |   |         |        
|                                                                                              | Total expenses |                        |         | 412,519 |   |         | 406,650
|                                                                                              |                |                        |         |         |   |         |        
|Equity in earnings of unconsolidated joint ventures                                           |                |                        | 14,793  |         |   | 9,004   |        
|                                                                                              |                |                        |         |         |   |         |        
|Income before realized gains (losses) and unrealized losses on disposition of rental property |                |                        | 171,888 |         |   | 177,698 |        
|Realized gains (losses) and unrealized losses on disposition of rental property, net          |                |                        | 2,759   |         |   | (11,864 | )      
|                                                                                              |                |                        |         |         |   |         |        
|Net income                                                                                    |                |                        | 174,647 |         |   | 165,834 |        
|Preferred unit distributions                                                                  |                |                        | (15,656 | )       |   | (15,644 | )      
|                                                                                              |                |                        |         |         |   |         |        
|Net income available to common unitholders                                                    |                | $                      | 158,991 |         | $ | 150,190 |        
|                                                                                              |                |                        |         |         |   |         |        

59

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The
following is a summary of the changes in revenue from rental operations and property expenses divided into Same-Store Properties, Acquired Properties and Dispositions
(dollars in thousands):

|                                        |  | Total Operating
Partnership |         | Same-Store Properties |       | Acquired Properties |   | Dispositions |  
|--------------------------------------- |  | --------------------------- | ------- | --------------------- | ----- | ------------------- | - | ------------ | -
|
|Revenue from rental operations:         |  |                             |         |                       |       |                     |   |              |  
|Base rents                              |  | $                           | (14,140 | )                     | (2.8) | %                   | $ | 3,466        |  
|Escalations and recoveries from tenants |  |                             | 974     |                       | 1.7   |                     |   | 2,038        |  
|Parking and other                       |  |                             | 7,320   |                       | 69.6  |                     |   | 4,232        |  
|                                        |  |                             |         |                       |       |                     |   |              |  
|Total                                   |  | $                           | (5,846  | )                     | (1.0) | %                   | $ | 9,736        |  
|                                        |  |                             |         |                       |       |                     |   |              |  
|Property expenses:                      |  |                             |         |                       |       |                     |   |              |  
|Real estate taxes                       |  | $                           | (1,179  | )                     | (1.9) | %                   | $ | 1,905        |  
|Utilities                               |  |                             | (5,048  | )                     | (11.5 | )                   |   | (2,227       | )
|Operating services                      |  |                             | (330    | )                     | (0.5  | )                   |   | 3,729        |  
|                                        |  |                             |         |                       |       |                     |   |              |  
|Total                                   |  | $                           | (6,557  | )                     | (3.8) | %                   | $ | 3,407        |  
|                                        |  |                             |         |                       |       |                     |   |              |  
|OTHER DATA:                             |  |                             |         |                       |       |                     |   |              |  
|Number of Consolidated Properties       |  |                             | 256     |                       |       |                     |   | 234          |  
|Square feet (in thousands)              |  |                             | 27,109  |                       |       |                     |   | 23,920       |  

Base
rents for the Same-Store Properties increased $3.5 million, or 0.7 percent, for 2002 as compared to 2001, due primarily to rental rate increases in 2002,
partially offset by decreases in space leased at the properties in 2002. Escalations and recoveries from tenants for the Same-Store Properties increased $2.0 million, or
3.6 percent, for 2002 over 2001, due primarily to the recovery of an increased amount of total property expenses in 2002. Parking and other income for the Same-Store Properties
increased $4.2 million, or 40.2 percent, due primarily to increased lease termination fees in 2002, primarily as a result of the Operating Partnership receiving $2.9 million in
August 2002 from a lease termination agreement with Arthur Andersen, LLP.

Real
estate taxes on the Same-Store Properties increased $1.9 million, or 3.1 percent, for 2002 as compared to 2001, due primarily to property tax rate
increases in certain municipalities in 2002, partially offset by lower assessments on certain properties in 2002. Utilities for the Same-Store Properties decreased $2.2 million, or
5.1 percent, for 2002 as compared to 2001, due primarily to decreased rates in 2002. Operating services for the Same-Store Properties increased $3.7 million, or
5.4 percent, due primarily to increased insurance costs in 2002.

Equity
in earnings of unconsolidated joint ventures increased $5.8 million, or 64.3 percent, for 2002 as compared to 2001. This is due primarily to properties developed by
joint ventures commencing initial operations in 2001 and 2002, higher occupancies at certain properties and net gain on sales of certain joint venture office properties, partially offset by a net loss
of $1.8 million from the initial operations of the Harborside South Pier hotel venture in 2002. See Note 4 to the Financial Statements.

Interest
income increased $0.1 million, or 5.3 percent, for 2002 as compared to 2001. This increase was due primarily to the effect of net proceeds from property sales
being invested in cash and cash equivalents for the period of time prior to which such proceeds were reinvested, partially offset by lower interest rates in 2002.

60

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General
and administrative decreased by $1.4 million, or 5.0 percent, for 2002 as compared to 2001. This increase is due primarily to a decrease in bad debt expense of
approximately $2.9 million from 2001 to 2002, partially offset by an increase in state tax expense of $1.6 million in 2002.

Depreciation
and amortization increased by $18.0 million, or 19.7 percent, for 2002 over 2001. Of this increase, $12.9 million, or 14.2 percent, is
attributable to the Same-Store Properties (including catch-up depreciation and amortization of $7.3 million in connection with the Operating Partnership's change of plan
to sell 20 of its office properties and a land parcel located in Colorado and its 5 remaining properties located in Texas), and $7.2 million, or 7.9 percent, is due to the Acquired
Properties, partially offset by a decrease of $2.1 million, or 2.4 percent, due to the Dispositions.

Interest
expense decreased $4.2 million, or 3.7 percent, for 2002 as compared to 2001. This decrease is due primarily to lower interest rates on variable rate borrowings.

Income
before realized gains (losses) and unrealized losses on disposition of rental property and minority interests decreased to $171.9 million in 2002 from $177.7 million
in 2001. The decrease of approximately $5.8 million is due to the factors discussed above.

Net
income available to common unitholders increased by $8.8 million, from $150.2 million in 2001 to $159.0 million in 2002. This increase was a result of realized
gains (losses) and unrealized losses on disposition of rental property, net, of $11.9 million in 2001 and realized gains (losses) and unrealized losses on disposition of rental property, net,
of $2.7 million in 2002. This was partially offset by a decrease in 2002 in income before realized gains (losses) and unrealized losses on dispositions of rental property of
$5.8 million.

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Year Ended December 31, 2001 Compared to Year Ended December 31, 2000

|                                                                                                                    |                | Year Ended
December 31 |         |         |   |         |        
|------------------------------------------------------------------------------------------------------------------- | -------------- | ---------------------- | ------- | ------- | - | ------- | -------
|
|
|Revenue from rental operations:                                                                                     |                |                        |         |         |   |         |        
|Base rents                                                                                                          |                | $                      | 506,557 |         | $ | 491,193 |        
|Escalations and recoveries from tenants                                                                             |                |                        | 56,083  |         |   | 58,488  |        
|Parking and other                                                                                                   |                |                        | 10,518  |         |   | 15,325  |        
|                                                                                                                    |                |                        |         |         |   |         |        
|                                                                                                                    | Sub-total      |                        |         | 573,158 |   |         | 565,006
|Interest income                                                                                                     |                |                        | 2,186   |         |   | 3,092   |        
|                                                                                                                    |                |                        |         |         |   |         |        
|                                                                                                                    | Total revenues |                        |         | 575,344 |   |         | 568,098
|                                                                                                                    |                |                        |         |         |   |         |        
|Property expenses:                                                                                                  |                |                        |         |         |   |         |        
|Real estate taxes                                                                                                   |                |                        | 62,015  |         |   | 59,400  |        
|Utilities                                                                                                           |                |                        | 43,892  |         |   | 42,035  |        
|Operating services                                                                                                  |                |                        | 68,779  |         |   | 70,711  |        
|                                                                                                                    |                |                        |         |         |   |         |        
|                                                                                                                    | Sub-total      |                        |         | 174,686 |   |         | 172,146
|General and administrative                                                                                          |                |                        | 28,490  |         |   | 23,276  |        
|Depreciation and amortization                                                                                       |                |                        | 91,471  |         |   | 92,088  |        
|Interest expense                                                                                                    |                |                        | 112,003 |         |   | 105,394 |        
|Non-recurring charges                                                                                               |                |                        |        |         |   | 37,139  |        
|                                                                                                                    |                |                        |         |         |   |         |        
|                                                                                                                    | Total expenses |                        |         | 406,650 |   |         | 430,043
|                                                                                                                    |                |                        |         |         |   |         |        
|Equity in earnings of unconsolidated joint ventures                                                                 |                |                        | 9,004   |         |   | 8,055   |        
|                                                                                                                    |                |                        |         |         |   |         |        
|Income before realized gains (losses) and unrealized losses on disposition of rental property and minority interest |                |                        | 177,698 |         |   | 146,110 |        
|Realized gains (losses) and unrealized losses on disposition of rental property, net                                |                |                        | (11,864 | )       |   | 85,353  |        
|                                                                                                                    |                |                        |         |         |   |         |        
|Income before minority interest                                                                                     |                |                        | 165,834 |         |   | 231,463 |        
|Minority interest in consolidated partially-owned properties                                                        |                |                        |        |         |   | 5,072   |        
|                                                                                                                    |                |                        |         |         |   |         |        
|Net income                                                                                                          |                |                        | 165,834 |         |   | 226,391 |        
|Preferred unit distributions                                                                                        |                |                        | (15,644 | )       |   | (15,441 | )      
|                                                                                                                    |                |                        |         |         |   |         |        
|Net income available to common unitholders                                                                          |                | $                      | 150,190 |         | $ | 210,950 |        
|                                                                                                                    |                |                        |         |         |   |         |        

62

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The
following is a summary of the changes in revenue from rental operations and property expenses divided into Same-Store Properties, Acquired Properties and Dispositions
(dollars in thousands):

|                                        |  | Total Operating
Partnership |        | Same-Store Properties |       | Acquired Properties |   | Dispositions |  
|--------------------------------------- |  | --------------------------- | ------ | --------------------- | ----- | ------------------- | - | ------------ | -
|
|Revenue from rental operations:         |  |                             |        |                       |       |                     |   |              |  
|Base rents                              |  | $                           | 15,364 |                       | 3.1   | %                   | $ | 10,039       |  
|Escalations and recoveries from tenants |  |                             | (2,405 | )                     | (4.1  | )                   |   | (1,804       | )
|Parking and other                       |  |                             | (4,807 | )                     | (31.4 | )                   |   | (4,432       | )
|                                        |  |                             |        |                       |       |                     |   |              |  
|Total                                   |  | $                           | 8,152  |                       | 1.4   | %                   | $ | 3,803        |  
|                                        |  |                             |        |                       |       |                     |   |              |  
|Property expenses:                      |  |                             |        |                       |       |                     |   |              |  
|Real estate taxes                       |  | $                           | 2,615  |                       | 4.4   | %                   | $ | 938          |  
|Utilities                               |  |                             | 1,857  |                       | 4.4   |                     |   | 1,696        |  
|Operating services                      |  |                             | (1,932 | )                     | (2.7  | )                   |   | (1,279       | )
|                                        |  |                             |        |                       |       |                     |   |              |  
|Total                                   |  | $                           | 2,540  |                       | 1.5   | %                   | $ | 1,355        |  
|                                        |  |                             |        |                       |       |                     |   |              |  
|OTHER DATA:                             |  |                             |        |                       |       |                     |   |              |  
|Number of Consolidated Properties       |  |                             | 259    |                       |       |                     |   | 240          |  
|Square feet (in thousands)              |  |                             | 26,983 |                       |       |                     |   | 24,602       |  

Base
rents for the Same-Store Properties increased $10.0 million, or 2.0 percent, for 2001 as compared to 2000, due primarily to rental rate increases in 2001.
Escalations and recoveries from tenants for the Same-Store Properties decreased $1.8 million, or 3.1 percent, for 2001 over 2000, due to the recovery of a decreased amount of
total property expenses partially as a result of new base years established from 2001 leasing activity. Parking and other income for the Same-Store Properties decreased
$4.4 million, or 28.9 percent, due primarily to fewer lease termination fees in 2001.

Real
estate taxes on the Same-Store Properties increased $0.9 million, or 1.6 percent, for 2001 as compared to 2000, due primarily to property tax rate
increases in certain municipalities in 2001, partially offset by lower assessments on certain properties in 2001. Utilities for the Same-Store Properties increased $1.7 million, or
4.0 percent, for 2001 as compared to 2000, due primarily to increased rates. Operating services for the Same-Store Properties decreased $1.3 million, or 1.8 percent,
due primarily to decreased maintenance and snow removal costs in 2001.

Equity
in earnings of unconsolidated joint ventures increased $0.9 million, or 11.8 percent, for 2001 as compared to 2000. This is due primarily to properties developed by
joint ventures being placed in service in 2001 and higher occupancies at certain properties, partially offset by the sale of joint venture office properties in 2001 (see Note 4 to the Financial
Statements).

Interest
income decreased $0.9 million, or 29.3 percent, for 2001 as compared to 2000. This decrease was due primarily to additional interest income in 2000 on investment
of proceeds from the 2000 Dispositions in cash and cash equivalents for longer periods of time.

General
and administrative increased by $5.2 million, or 22.4 percent, for 2001 as compared to 2000. This increase is due primarily to increased bad debt expense of
approximately $2.5 million in 2001, related to a lease termination fee receivable due from a former tenant deemed uncollectible, increased professional fees, mostly on account of costs for
transactions not consummated, and increased payroll and payroll-related costs in 2001.

63

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Depreciation
and amortization decreased by $0.6 million, or 0.7 percent, for 2001 over 2000. Of this decrease, $2.1 million, or 2.2 percent, is attributable
to the Same-Store Properties, and $3.3 million, or 3.7 percent, is due to the Dispositions, partially offset by an increase of $4.8 million, or 5.2 percent, due
to the Acquired Properties.

Interest
expense increased $6.6 million, or 6.3 percent, for 2001 as compared to 2000. This increase is due primarily to higher average outstanding debt balances in 2001
versus 2000, primarily as a result of Common Stock repurchases in late 2000 and early 2001 and, to a lesser extent, the replacement in early 2001 of short-term credit facility borrowings
with long-term, higher fixed rate debt.

Non-recurring
charges of $37.1 million were incurred in 2000 as a result of costs associated with the termination of the Prentiss merger agreement in
September 2000 (see Note 20 to the Financial Statements) and costs associated with the resignations of certain officers of the Corporation in June 2000 (see Note 16 to the
Financial Statements).

Income
before realized gains (losses) and unrealized losses on disposition of rental property and minority interests increased to $177.7 million in 2001 from $146.1 million
in 2000. The increase of approximately $31.6 million is due to the factors discussed above.

Net
income available to common unitholders decreased by $60.8 million, from $211.0 million in 2000 to $150.2 million in 2001. This decrease was a result of realized
gains on disposition of rental property of $85.4 million in 2000, realized gains (losses) and unrealized losses on disposition of rental property, net, of $11.9 million in 2001 and an
increase in preferred unit distributions of $0.2 million. This was partially offset by an increase in 2001 in income before realized gains (losses) and unrealized losses on dispositions of
rental property and minority interest of $31.6 million and a decrease in minority interest in consolidated partially-owned properties of $5.1 million in 2001.

Liquidity and Capital Resources

Historically, rental revenue has been the principal source of funds to pay operating expenses, debt service and capital expenditures, excluding
non-recurring capital expenditures. To the extent that the Operating Partnership's cash flow from operating activities is insufficient to finance its non-recurring capital
expenditures such as property acquisition and development and construction costs and other capital expenditures, the Operating Partnership has and expects to continue to finance such activities
through borrowings under its revolving credit facility and other debt and equity financings.

The
Operating Partnership believes that with the current downturn in the economy in general, and the softening of the Operating Partnership's markets specifically, it is reasonably
likely that vacancy rates may continue to increase, effective rental rates on new and renewed leases may continue to decrease and tenant installation costs may continue to increase in most or all of
its markets during 2003. As a
result of the potential negative effects on the Operating Partnership's rental revenue from the overall reduced demand for office space, the Operating Partnership's cash flow may be insufficient to
cover increased tenant installation costs over the short-term. If this situation were to occur, the Operating Partnership expects to finance any shortfall through borrowings under its
revolving credit facility and other debt and equity financings.

The
Operating Partnership expects to meet its short-term liquidity requirements generally through its working capital, net cash provided by operating activities and from its
revolving credit facility. The Operating Partnership frequently examines potential property acquisitions and development projects and, at any given time, one or more of such acquisitions or
development projects may be under consideration. Accordingly, the ability to fund property acquisitions and development projects is a major part of the Operating Partnership's financing requirements.
The Operating Partnership expects to meet its financing requirements through funds generated from operating activities, proceeds from

64

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property sales, long-term and short-term borrowings (including draws on the Operating Partnership's revolving credit facility) and the issuance of additional debt and/or
equity securities.

As
of December 31, 2002, the Operating Partnership's total indebtedness of $1.8 billion (weighted average interest rate of 7.03 percent) was comprised of
$105.2 million of revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 2.41 percent) and fixed rate debt of $1.6 billion (weighted
average rate of 7.33 percent).

The
Operating Partnership has three investment grade credit ratings. Standard & Poor's Rating Services ("S&P") and Fitch, Inc. ("Fitch") have each assigned their BBB rating
to existing and prospective senior unsecured debt of the Operating Partnership. S&P and Fitch have also assigned their BBB-rating to prospective preferred stock offerings of the
Corporation. Moody's Investors Service ("Moody's") has assigned its Baa3 rating to the existing and prospective senior unsecured debt of the Operating Partnership and its Ba1 rating to prospective
preferred stock offerings of the Corporation.

On
September 27, 2002, the Operating Partnership obtained an unsecured revolving credit facility with a current borrowing capacity of $600.0 million from a group of 14
lenders, as described in Note 9 to the Financial Statements. As of December 31, 2002, the Operating Partnership had outstanding borrowings of $73.0 million under its unsecured
revolving credit facility.

The
interest rate on outstanding borrowings under the unsecured facility is currently LIBOR plus 70 basis points. The Operating Partnership may instead elect an interest rate
representing the higher of the lender's prime rate or the Federal Funds rate plus 50 basis points. The unsecured facility also currently requires a 20 basis point facility fee on the current borrowing
capacity payable quarterly in arrears.

In
the event of a change in the Operating Partnership's unsecured debt rating, the interest and facility fee rates will be adjusted in accordance with the following table:

|Operating Partnership's
Unsecured Debt Ratings:
S&P/Moody's/Fitch(a) |  | Interest Rate 
Applicable Basis Points
Above LIBOR |  | Facility Fee
Basis Points
|-------------------------------------------------------------------- |  | --------------------------------------------------- |  | -------------------------
|No rating or less than BBB-/Baa3/BBB-                                |  | 120.0                                               |  | 30.0                     
|BBB-/Baa3/BBB-                                                       |  | 95.0                                                |  | 20.0                     
|BBB/Baa2/BBB (current)                                               |  | 70.0                                                |  | 20.0                     
|BBB+/Baa1/BBB+                                                       |  | 65.0                                                |  | 15.0                     
|A-/A3/A- or higher                                                   |  | 60.0                                                |  | 15.0                     

---

65

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The unsecured facility matures in September 2005, with an extension option of one year, which would require a payment of 25 basis points of the then borrowing capacity of the
credit line upon exercise. The Operating Partnership believes that the unsecured facility is sufficient to meet its revolving credit facility needs.

The
terms of the unsecured facility include certain restrictions and covenants which limit, among other things, the payment of dividends (as discussed below), the incurrence of
additional indebtedness, the incurrence of liens and the disposition of assets, and which require compliance with financial ratios relating to the maximum leverage ratio, the maximum amount of secured
indebtedness, the minimum amount of tangible net worth, the minimum amount of debt service coverage, the minimum amount of fixed charge coverage, the maximum amount of unsecured indebtedness, the
minimum amount of unencumbered property debt service coverage and certain investment limitations. The dividend restriction referred to above provides that, except to enable the Corporation to continue
to qualify as a REIT under the Code, the Corporation will not during any four consecutive fiscal quarters make distributions with respect to common stock or other equity interests in an aggregate
amount in excess of 90 percent of funds from operations (as defined) for such period, subject to certain other adjustments.

The
terms of the Operating Partnership's Senior Unsecured Notes, as defined in Note 8 to the Financial Statements (which totaled approximately $1.1 billion as of
December 31, 2002), include certain restrictions and covenants which require compliance with financial ratios relating to the maximum amount of debt leverage, the maximum amount of secured
indebtedness, the minimum amount of debt service coverage and the maximum amount of unsecured debt as a percent of unsecured assets.

As
of December 31, 2002, the Operating Partnership had 231 unencumbered properties, totaling 20.8 million square feet, representing 76.9 percent of the Operating
Partnership's total portfolio on a square footage basis.

The
debt of the Operating Partnership's unconsolidated joint ventures aggregating $152.7 million are non-recourse to the Operating Partnership except for
(i) customary exceptions pertaining to such matters as intentional misuse of funds, environmental conditions and material misrepresentations and (ii) approximately $11.1 million
of debt on the Harborside South Pier joint venture with Hyatt Corporation ("Hyatt"). Additionally, the Operating Partnership has posted an $8.0 million letter of credit in support of another
loan to that joint venture, $4.0 million of which is indemnified by Hyatt, and a $1.8 million letter of credit as a reserve for re-leasing costs on a mortgage loan with the
G&G Martco joint venture.

The
following table outlines the timing of payment requirements related to the Operating Partnership's debt, PILOT agreements, and ground lease agreements(in
thousands):

|                                  |  | Payments Due by Period
|--------------------------------- |  | ----------------------
|
|Senior unsecured notes            |  | $                     
|Revolving credit facility         |  |                       
|Mortgages and loans payable       |  |                       
|Payments in lieu of taxes (PILOT) |  |                       
|Ground lease payments             |  |                       

As
of December 31, 2002, the Operating Partnership's total debt had a weighted average term to maturity of approximately 4.5 years. The Operating Partnership has a total of
$402.1 million of senior unsecured notes and mortgage debt scheduled to mature through March 2004. The Operating

66

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Partnership does not intend to reserve funds to retire the Operating Partnership's Senior Unsecured Notes or its mortgages and loans payable upon maturity. Instead, the Operating Partnership will
seek to refinance such debt at maturity or retire such debt through the issuance of additional equity or debt securities on or before the applicable maturity dates. If it cannot timely raise such
proceeds, the Operating Partnership may draw on its revolving credit facility to retire the maturing indebtedness, which would reduce the future availability of funds under such facility. The
Operating Partnership is reviewing various refinancing options, including the issuance of additional, or exchange of current, unsecured debt, preferred stock, and/or obtaining additional mortgage
debt, some or all of which may be completed during 2003. The Operating Partnership anticipates that its available cash and cash equivalents and cash flows from operating activities, together with cash
available from borrowings and other sources, will be adequate to meet the Operating Partnership's capital and liquidity needs both in the short and long-term. However, if these sources of
funds are insufficient or unavailable, the Operating Partnership's ability to make the expected distributions discussed below may be adversely affected.

The
Corporation has an effective shelf registration statement with the SEC for an aggregate amount of $2.0 billion in equity securities of the Corporation. The Corporation and
Operating Partnership also have an effective shelf registration statement with the SEC for an aggregate of $2.0 billion in debt securities, preferred stock and preferred stock represented by
depositary shares, under which the Operating Partnership has issued an aggregate of $1.2 billion of senior unsecured notes.

On
September 13, 2000, the Board of Directors of the Corporation authorized an increase to the Corporation's repurchase program under which the Corporation was permitted to
purchase up to an additional $150.0 million of the Corporation's outstanding common stock ("Repurchase Program"). From that date through February 14, 2003, the Corporation purchased for
constructive retirement under the Repurchase Program 3.7 million shares of its outstanding common stock for an aggregate cost of approximately $104.5 million. Concurrent with these
purchases, the Corporation sold to the Operating Partnership 3.7 million common units for an aggregate cost of approximately $104.5 million. The Corporation has a remaining authorization
to repurchase up to an additional $45.5 million of its outstanding common stock, which it may repurchase from time to time in open market transactions at prevailing prices or through privately
negotiated transactions.

The
Operating Partnership may not dispose of or distribute certain of its properties, currently comprising 141 properties with an aggregate net book value of approximately
$1.8 billion, which were originally contributed by members of either the Mack Group (which includes William L. Mack, Chairman of the Corporation's Board of Directors; Earle I. Mack, director;
and Mitchell E. Hersh, chief executive officer and director), the Robert Martin Group (which includes Robert F. Weinberg, director; Martin S. Berger, a former director; and Timothy M. Jones,
president), or the Cali Group
(which includes John J. Cali, director and John R. Cali, director) without the express written consent of a representative of the Mack Group, the Robert Martin Group or the Cali Group, as applicable,
except in a manner which does not result in recognition of any built-in-gain (which may result in an income tax liability) or which reimburses the appropriate Mack Group,
Robert Martin Group or Cali Group members for the tax consequences of the recognition of such built-in-gains (collectively, the "Property Lock-Ups"). The
aforementioned restrictions do not apply in the event that the Operating Partnership sells all of its properties or in connection with a sale transaction which the Corporation's Board of Directors
determines is reasonably necessary to satisfy a material monetary default on any unsecured debt, judgment or liability of the Operating Partnership or to cure any material monetary default on any
mortgage secured by a property. The Property Lock-Ups expire periodically through 2008. Upon the expiration of the Property Lock-Ups, the Operating Partnership is required to
use commercially reasonable efforts to prevent any sale, transfer or other disposition of the subject properties from

67

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resulting in the recognition of built-in gain to the appropriate Mack Group, Robert Martin Group or Cali Group members.

To
maintain its qualification as a REIT, the Corporation must make annual distributions to its stockholders of at least 90 percent of its REIT taxable income, determined without
regard to the dividends paid deduction and by excluding net capital gains. Moreover, the Corporation intends to continue to make regular quarterly distributions to its stockholders which, based upon
current policy, in the aggregate would equal approximately $164.1 million on an annualized basis. However, any such distribution, whether for federal income tax purposes or otherwise, would
only be paid out of available cash after meeting both operating requirements and scheduled debt service on the Operating Partnership's debt.

Funds from Operations

The Operating Partnership considers funds from operations ("FFO"), after adjustment for straight-lining of rents and non-recurring charges, one
measure of REIT performance. FFO is defined as net income (loss) before minority interest of unitholders, computed in accordance with generally accepted accounting principles ("GAAP"), excluding gains
(or losses) from debt restructuring, other extraordinary items, and sales of depreciable rental property, plus real estate-related depreciation and amortization. FFO should not be considered as an
alternative to net income as an indication of the Operating Partnership's performance or to cash flows as a measure of liquidity. FFO presented herein is not necessarily comparable to FFO presented by
other real estate companies due to the fact that not all real estate companies use the same definition. However, the Operating Partnership's FFO is comparable to the FFO of real estate companies that
use the current definition of the National Association of Real Estate Investment Trusts ("NAREIT"), with the exception that it deviates as a result of adjustments made to the Operating Partnership's
FFO for straight-lining of rents and non-recurring charges. The Operating Partnership adjusts its FFO calculation to remove the effects of straight-lining of rents because it believes that
such adjustment more accurately reflects proper recognition of the Operating Partnership's revenue that is contractually due for the respective periods presented. The Operating Partnership also
adjusts its FFO calculation for non-recurring charges because it believes that the inclusion of these costs, which are incurred specific to significant non-recurring events,
can impact the comparative measurement of the Operating Partnership's performance.

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FFO for the years ended December 31, 2002, 2001 and 2000, as calculated in accordance with NAREIT's definition as published in October 1999, after adjustment for
straight-lining of rents and non-recurring charges, are summarized in the following table (in thousands):

|                                                                                                                                             |                       | Year Ended December 31, |         
|-------------------------------------------------------------------------------------------------------------------------------------------- | --------------------- | ----------------------- | --------
|
|Net income                                                                                                                                   |                       | $                       | 174,647 
|(Deduct)/Add:    Realized (gains) losses and unrealized losses on
                            disposition of rental property, net            |                       |                         | (2,759  
|Add:Real estate-related depreciation and amortization (1)                                                                                    |                       |                         | 112,718 
|                                                                                                                                             | Gain on sale of land  |                         |         
|                                                                                                                                             | Non-recurring charges |                         |         
|Deduct:Rental income adjustment for straight-lining of rents (2)                                                                             |                       |                         | (9,529  
|Equity in earnings from gain on sale of rental property                                                                                      |                       |                         | (3,506  
|                                                                                                                                             |                       |                         |         
|Funds from operations, after adjustment for straight-lining                                                                                  |                       |                         |         
|of rents and non-recurring charges                                                                                                           |                       | $                       | 272,288 
|Deduct:    Distributions to preferred unitholders                                                                                            |                       |                         | (15,656 
|                                                                                                                                             |                       |                         |         
|Funds from operations, after adjustment for straight-lining of rents and non-recurring charges, after distributions to preferred unitholders |                       | $                       | 256,632 
|                                                                                                                                             |                       |                         |         
|Cash flows provided by operating activities                                                                                                  |                       | $                       | 220,137 
|Cash flows (used in) provided by investing activities                                                                                        |                       | $                       | (106,349
|Cash flows used in financing activities                                                                                                      |                       | $                       | (125,456
|                                                                                                                                             |                       |                         |         
|Basic weighted average units outstanding (3)                                                                                                 |                       |                         | 65,109  
|                                                                                                                                             |                       |                         |         
|Diluted weighted average units outstanding (3)                                                                                               |                       |                         | 71,715  
|                                                                                                                                             |                       |                         |         

---

The
following schedule reconciles the Operating Partnership's basic weighted average units outstanding to the basic and diluted weighted average units outstanding presented above (in thousands):

|                                                                                     |  | Year Ended December 31,
|------------------------------------------------------------------------------------ |  | -----------------------
|
|Basic weighted average units outstanding:                                            |  | 65,109                 
|Add: Weighted average preferred units
            (after conversion to common units) |  | 6,288                  
|Stock options                                                                        |  | 302                    
|Restricted Stock Awards                                                              |  | 14                     
|Stock warrants                                                                       |  | 2                      
|                                                                                     |  |                        
|Diluted weighted average units outstanding:                                          |  | 71,715                 
|                                                                                     |  |                        

Inflation

The Operating Partnership's leases with the majority of its tenants provide for recoveries and escalation charges based upon the tenant's proportionate share of,
and/or increases in, real estate taxes

69

---

and certain operating costs, which reduce the Operating Partnership's exposure to increases in operating costs resulting from inflation.

Disclosure Regarding Forward-Looking Statements

The Operating Partnership considers portions of this information to be forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934. The Operating Partnership intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of
the Exchange Act. Such forward-looking statements relate to, without limitation, the Operating Partnership's future economic performance, plans and objectives for future operations and projections of
revenue and other financial items. Forward-looking statements can be identified by the use of words such as "may," "will," "should," "expect," "anticipate," "estimate," "continue" or comparable
terminology. Forward-looking statements are inherently subject to risks and uncertainties, many of which the Operating Partnership cannot predict with accuracy and some of which the Operating
Partnership might not even anticipate. Although the Operating Partnership believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time
made, it can give no assurance that its expectations will be achieved. Future events and actual results, financial and otherwise, may differ materially from the results discussed in the
forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements. Among the factors about which the Operating Partnership has made assumptions are
changes in the general economic climate; conditions, including those affecting industries in which the Operating Partnership's principal tenants compete; any failure of the general economy to recover
from the current economic downturn; the extent of any tenant bankruptcies; the Operating Partnership's ability to lease or re-lease space at current or anticipated rents; changes in the
supply of and demand for office, office/flex and industrial/warehouse properties; changes in interest rate levels; changes in operating costs; the Operating Partnership's ability to obtain adequate
insurance, including coverage for terrorist acts; the availability of financing; and other risks associated with the development and acquisition of properties, including risks that the development may
not be completed on schedule, that the tenants will not take occupancy or pay rent, or that development or operating costs may be greater than anticipated. For further information on factors which
could impact the Operating Partnership and the statements contained herein, see the "Risk Factors" section. The Operating Partnership assumes no obligation to update and supplement forward-looking
statements that become untrue because of subsequent events.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the exposure to loss resulting from changes in interest rates, foreign currency exchange rates, commodity prices and equity prices. In pursuing its
business plan, the primary market risk to which the Operating Partnership is exposed is interest rate risk. Changes in the general level of interest rates prevailing in the financial markets may
affect the spread between the Operating Partnership's yield on invested assets and cost of funds and, in turn, its ability to make distributions or payments to its investors.

Approximately
$1.6 billion of the Operating Partnership's long-term debt bears interest at fixed rates and therefore the fair value of these instruments is affected by
changes in market interest rates. The following table presents principal cash flows (in thousands) based upon maturity dates of the debt obligations and the related weighted-average interest rates by
expected maturity dates for the fixed rate

70

---

debt. The interest rate on the variable rate debt as of December 31, 2002 ranged from LIBOR plus 65 basis points to LIBOR plus 70 basis points.

|December 31, 2002
Debt, including current portion |  | 2003 |         | 2004 |   | 2005    |   | 2006 |         | 2007 |   | Thereafter |   | Total |        | Fair Value
|------------------------------------------------- |  | ---- | ------- | ---- | - | ------- | - | ---- | ------- | ---- | - | ---------- | - | ----- | ------ | ----------
|Fixed Rate                                        |  | $    | 107,668 |      | $ | 314,599 |   | $    | 257,392 |      | $ | 216,532    |   | $     | 9,338  |           
|Average Interest Rate                             |  |      | 7.35    | %    |   | 7.33    | % |      | 7.13    | %    |   | 7.06       | % |       | 6.96   | %         
|Variable Rate                                     |  |      |         |      |   |         |   | $    | 73,000  |      |   |            |   | $     | 32,178 |           

While
the Operating Partnership has not experienced any significant credit losses, in the event of a significant rising interest rate environment and/or economic downturn, defaults could
increase and result in losses to the Operating Partnership which could adversely affect its operating results and liquidity.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information required to be furnished pursuant to this item is contained in the Consolidated Financial Statements, together with the notes to the Consolidated
Financial Statements and the report of independent accountants.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
                AND FINANCIAL DISCLOSURE

None.

71

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PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The information required by Item 10 is incorporated by reference to the Corporation's definitive proxy statement for its annual meeting of shareholders to be held
on May 13, 2003.

ITEM 11. EXECUTIVE COMPENSATION

The information required by Item 11 is incorporated by reference to the Corporation's definitive proxy statement for its annual meeting of shareholders to be held
on May 13, 2003.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT                 AND RELATED STOCKHOLDER MATTERS

The information required by Item 12 is incorporated by reference to the Corporation's definitive proxy statement for its annual meeting of shareholders to be held
on May 13, 2003.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information required by Item 13 is incorporated by reference to the Corporation's definitive proxy statement for its annual meeting of shareholders to be held
on May 13, 2003.

ITEM 14. CONTROLS AND PROCEDURES

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K

(a) 1. Financial Statements and Report of PricewaterhouseCoopers LLP, Independent Accountants



(a) 2. Financial Statement Schedules

Schedule IIIReal Estate Investments and Accumulated Depreciation as of December 31, 2002

72

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All
other schedules are omitted because they are not required or the required information is shown in the financial statements or notes thereto.

(a) 3. Exhibits

The
following exhibits are filed herewith or are incorporated by reference to exhibits previously filed:

|Exhibit
Number |  | Exhibit Title                                                                                                                                                                                                                                                                                                        
|-------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1            |  | Restated Charter of Mack-Cali Realty Corporation dated June 11, 2001 (filed as Exhibit 3.1 to the Operating Partnership's Form 10-Q dated June 30, 2001 and incorporated herein by reference).                                                                                                                       
|3.2            |  | Amended and Restated Bylaws of Mack-Cali Realty Corporation dated June 10, 1999 (filed as Exhibit 3.2 to the Corporation's Form 8-K dated June 10, 1999 and incorporated herein by reference).                                                                                                                       
|3.3            |  | Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated December 11, 1997 (filed as Exhibit 10.110 to the Corporation's Form 8-K dated December 11, 1997 and incorporated herein by reference).                                                                                 
|3.4            |  | Amendment No. 1 to the Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated August 21, 1998 (filed as Exhibit 3.1 to the Corporation's and the Operating Partnership's Registration Statement on Form S-3,
Registration No. 333-57103, and incorporated herein by reference).
|3.5            |  | Second Amendment to the Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated July 6, 1999 (filed as Exhibit 10.1 to the Operating Partnership's Form 8-K dated July 6, 1999 and incorporated herein by
reference).                                                           
|3.6            |  | Certificate of Designation of Series B Preferred Operating Partnership Units of Limited Partnership Interest of Mack-Cali Realty, L.P. (filed as Exhibit 10.101 to the Corporation's Form 8-K dated December 11, 1997 and incorporated herein by
reference).                                                         
|4.1            |  | Amended and Restated Shareholder Rights Agreement, dated as of March 7, 2000, between Mack-Cali Realty Corporation and EquiServe Trust Company, N.A., as Rights Agent (filed as Exhibit 4.1 to the Operating Partnership's Form 8-K dated March 7, 2000
and incorporated herein by reference).                       
|4.2            |  | Amendment No. 1 to the Amended and Restated Shareholder Rights Agreement, dated as of June 27, 2000, by and among Mack-Cali Realty Corporation and EquiServe Trust Company, N.A. (filed as Exhibit 4.1 to the Operating Partnership's Form 8-K dated June
27, 2000 and incorporated herein by reference).            
|4.3            |  | Indenture dated as of March 16, 1999, by and among Mack-Cali Realty, L.P., as issuer, Mack-Cali Realty Corporation, as guarantor, and Wilmington Trust Company, as trustee (filed as Exhibit 4.1 to the Operating Partnership's Form 8-K dated March 16,
1999 and incorporated herein by reference).                 
|4.4            |  | Supplemental Indenture No. 1 dated as of March 16, 1999, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership's Form 8-K dated March 16, 1999 and incorporated
herein by reference).                                          
|               |  |                                                                                                                                                                                                                                                                                                                      

73

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|4.5  |  | Supplemental Indenture No. 2 dated as of August 2, 1999, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.4 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated
herein by reference).        
|---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.6  |  | Supplemental Indenture No. 3 dated as of December 21, 2000, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership's Form 8-K dated December 21, 2000 and
incorporated herein by reference).  
|4.7  |  | Supplemental Indenture No. 4 dated as of January 29, 2001, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership's Form 8-K dated January 29, 2001 and incorporated
herein by reference).    
|4.8  |  | Supplemental Indenture No. 5 dated as of December 20, 2002, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership's Form 8-K dated December 20, 2002 and
incorporated herein by reference).
|10.1 |  | Amended and Restated Employment Agreement dated as of July 1, 1999 between Mitchell E. Hersh and Mack-Cali Realty Corporation (filed as Exhibit 10.2 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                           
|10.2 |  | Second Amended and Restated Employment Agreement dated as of July 1, 1999 between Timothy M. Jones and Mack-Cali Realty Corporation (filed as Exhibit 10.3 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                     
|10.3 |  | Second Amended and Restated Employment Agreement dated as of July 1, 1999 between Barry Lefkowitz and Mack-Cali Realty Corporation (filed as Exhibit 10.6 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                      
|10.4 |  | Second Amended and Restated Employment Agreement dated as of July 1, 1999 between Roger W. Thomas and Mack-Cali Realty Corporation (filed as Exhibit 10.7 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                      
|10.5 |  | Employment Agreement dated as of December 5, 2000 between Michael Grossman and Mack-Cali Realty Corporation (filed as Exhibit 10.5 to the Operating Partnership's Form 10-K for the year ended December 31, 2000 and incorporated herein by
reference).                            
|10.6 |  | Restricted Share Award Agreement dated as of July 1, 1999 between Mitchell E. Hersh and Mack-Cali Realty Corporation (filed as Exhibit 10.8 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                                    
|10.7 |  | Restricted Share Award Agreement dated as of July 1, 1999 between Timothy M. Jones and Mack-Cali Realty Corporation (filed as Exhibit 10.9 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by reference).                                     
|10.8 |  | Restricted Share Award Agreement dated as of July 1, 1999 between Barry Lefkowitz and Mack-Cali Realty Corporation (filed as Exhibit 10.12 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by reference).                                     
|10.9 |  | Restricted Share Award Agreement dated as of July 1, 1999 between Roger W. Thomas and Mack-Cali Realty Corporation (filed as Exhibit 10.13 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by reference).                                     
|     |  |                                                                                                                                                                                                                                                                                    

74

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|10.10 |  | Restricted Share Award Agreement dated as of March 12, 2001 between Roger W. Thomas and Mack-Cali Realty Corporation (filed as Exhibit 10.10 to the Operating Partnership's Form 10-Q dated March 31, 2001 and incorporated herein by
reference).                                      
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.11 |  | Restricted Share Award Agreement dated as of March 12, 2001 between Michael Grossman and Mack-Cali Realty Corporation (filed as Exhibit 10.11 to the Operating Partnership's Form 10-Q dated March 31, 2001 and incorporated herein by
reference).                                     
|10.12 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Mitchell E. Hersh (filed as Exhibit 10.1 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                   
|10.13 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Mitchell E. Hersh (filed as Exhibit 10.2 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                             
|10.14 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated July 1, 1999 between Mack-Cali Realty Corporation and Mitchell E. Hersh (filed as Exhibit 10.3 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference).
|10.15 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Timothy M. Jones (filed as Exhibit 10.4 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                    
|10.16 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Timothy M. Jones (filed as Exhibit 10.5 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                              
|10.17 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated July 1, 1999 between Mack-Cali Realty Corporation and Timothy M. Jones (filed as Exhibit 10.6 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference). 
|10.18 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Barry Lefkowitz (filed as Exhibit 10.7 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                     
|10.19 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Barry Lefkowitz (filed as Exhibit 10.8 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                               
|10.20 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated July 1, 1999 between Mack-Cali Realty Corporation and Barry Lefkowitz (filed as Exhibit 10.9 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference).  
|10.21 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Roger W. Thomas (filed as Exhibit 10.10 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                    
|10.22 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Roger W. Thomas (filed as Exhibit 10.11 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                              
|      |  |                                                                                                                                                                                                                                                                                        

75

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|10.23 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated July 1, 1999 between Mack-Cali Realty Corporation and Roger W. Thomas (filed as Exhibit 10.12 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                             
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.24 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated March 12, 2001 between Mack-Cali Realty Corporation and Roger W. Thomas (filed as Exhibit 10.13 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                           
|10.25 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.14 to the Corporation Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                                                                                                                                                                                                                                                                                                                                                                                                                              
|10.26 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.15 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.27 |  | Restricted Share Award Agreement dated December 6, 1999 by and between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.16 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|10.28 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated December 6, 1999 between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.17 to the Corporation's Form 8-K dated January 2, 2003
and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                     
|10.29 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated March 12, 2001 between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.18 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                       
|10.30 |  | Amended and Restated Revolving Credit Agreement dated as of September 27, 2002, among Mack-Cali Realty, L.P. and JPMorgan Chase Bank, Fleet National Bank and Other Lenders Which May Become Parties Thereto with JPMorgan Chase Bank, as administrative
agent, swing lender and fronting bank, Fleet National Bank and Commerzbank AG, New York and Grand Cayman branches as syndication agents, Bank of America, N.A. and Wells Fargo Bank, National Association, as documentation agents, and J.P. Morgan
Securities Inc. and Fleet Securities, Inc, as arrangers (filed as Exhibit 10.1 to the Operating Partnership's Form 8-K dated September 27, 2002 and incorporated herein by reference).
|10.31 |  | Contribution and Exchange Agreement among The MK Contributors, The MK Entities, The Patriot Contributors, The Patriot Entities, Patriot American Management and Leasing Corp., Cali Realty, L.P. and Cali Realty Corporation, dated September 18, 1997
(filed as Exhibit 10.98 to the Corporation's Form 8-K dated September 19, 1997 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                       
|10.32 |  | First Amendment to Contribution and Exchange Agreement, dated as of December 11, 1997, by and among the Company and the Mack Group (filed as Exhibit 10.99 to the Corporation's Form 8-K dated December 11, 1997 and incorporated herein by
reference).                                                                                                                                                                                                                                                                                                                                                                                                                                            
|10.33 |  | Employee Stock Option Plan of Mack-Cali Realty Corporation (filed as Exhibit 10.1 to the Corporation's Post-Effective Amendment No. 1 to Form S-8, Registration No. 333-44443, and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

76

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|10.34  |  | Director Stock Option Plan of Mack-Cali Realty Corporation (filed as Exhibit 10.2 to the Corporation's Post-Effective Amendment No. 1 to Form S-8, Registration No. 333-44443, and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|------ |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.35  |  | 2000 Employee Stock Option Plan (filed as Exhibit 10.1 to the Corporation's Registration Statement on Form S-8, Registration No. 333-52478, and incorporated herein by reference), as amended by the First Amendment to the 2000 Employee Stock Option
Plan (filed as Exhibit 10.17 to the Operating Partnership's Form 10-Q dated June 30, 2002 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                        
|10.36  |  | 2000 Director Stock Option Plan (filed as Exhibit 10.2 to the Corporation's Registration Statement on Form S-8, Registration No. 333-52478, and incorporated herein by reference), as amended by the First Amendment to the 2000 Director Stock Option
Plan (filed as Exhibit 10.18 to the Operating Partnership's Form 10-Q dated June 30, 2002 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                        
|10.37  |  | Deferred Compensation Plan for Directors (filed as Exhibit 10.1 to the Corporation's Registration Statement on Form S-8, Registration No. 333-80081, and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10.38  |  | Form of Indemnification Agreement dated October 22, 2002 by and between Mack-Cali Realty Corporation and each of William L. Mack, John J. Cali, Mitchell E. Hersh, Earle I. Mack, John R. Cali, Brendan T. Byrne, Martin D. Gruss, Nathan Gantcher,
Vincent Tese, Roy J. Zuckerberg, Alan G. Philibosian, Irvin D. Reid, Robert F. Weinberg, Timothy M. Jones, Barry Lefkowitz, Roger W. Thomas, Michael A. Grossman, James Clabby, Anthony Krug, Dean Cingolani, Anthony DeCaro Jr., Mark Durno, William
Fitzpatrick, John Kropke, Nicholas Mitarotonda, Jr., Michael Nevins, Virginia Sobol, Albert Spring and Daniel Wagner (filed as Exhibit 10.28 to the Operating Partnership's Form 10-Q dated September 30, 2002 and incorporated herein by
reference).
|10.39  |  | Indemnification Agreement dated October 22, 2002 by and between Mack-Cali Realty Corporation and John Crandall (filed as Exhibit 10.29 to the Operating Partnership's Form 10-Q dated September 30, 2002 and incorporated herein by
reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10.40  |  | Warrant Agreement, dated December 12, 1997, executed in favor of Mitchell E. Hersh to purchase shares of common stock, par value $.01 per share, of the Company (filed as Exhibit 10.106 to the Corporation's Form 8-K dated December 11, 1997 and
incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|10.41  |  | Warrant issued by Cali Realty Corporation to Brad W. Berger, dated January 31, 1997 (filed as Exhibit 10.84 to the Corporation's Form 10-K dated December 31, 1996 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.42  |  | Warrant issued by Cali Realty Corporation to Timothy M. Jones, dated January 31, 1997 (filed as Exhibit 10.86 to the Corporation's Form 10-K dated December 31, 1996 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10.43  |  | Warrant issued by Cali Realty Corporation to Michael Grossman, dated January 31, 1997 (filed as Exhibit 10.89 to the Corporation's Form 10-K dated December 31, 1996 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|*10.44 |  | Second Amendment to Contribution and Exchange Agreement, dated as of June 27, 2000, between RMC Development Company, LLC f/k/a Robert Martin Company, LLC, Robert Martin Eastview North Company, L.P., the Corporation and the Operating
Partnership.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

77

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|*21 |  | Subsidiaries of the Operating Partnership.                     
|--- |  | ---------------------------------------------------------------
|*23 |  | Consent of PricewaterhouseCoopers LLP, independent accountants.

---

During
the fourth quarter of 2002, the Operating Partnership filed the following reports on Form 8-K:



---

78

---



REPORT OF INDEPENDENT ACCOUNTANTS

To
the Partners of
Mack-Cali Realty, L.P.:

In
our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) on page 72 present fairly, in all material respects, the financial position of
Mack-Cali Realty, L.P. and its subsidiaries (the "Operating Partnership") at December 31, 2002 and 2001, and the results of their operations and their cash flows for each of the
three years in the period ended December 31, 2002, in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial
statement schedule listed in the index appearing under Item 15(a)(2) on page 72 presents fairly, in all material respects, the information set forth therein when read in conjunction with the related
consolidated financial statements. These financial statements and financial statement schedule are the responsibility of the Operating Partnership's management; our responsibility is to express an
opinion on these financial statements and financial statement schedule based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the
United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

|                                                                                             |  | 
|-------------------------------------------------------------------------------------------- |  | 
|/s/PRICEWATERHOUSECOOPERS LLPPricewaterhouseCoopers LLP
New York, New York
February 21, 2003 |  | 

79

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MACK-CALI REALTY, L.P. AND SUBSIDIARIES        CONSOLIDATED BALANCE SHEETS(in thousands, except per unit amounts)

|                                                                               |                                                | December 31,                      |          
|------------------------------------------------------------------------------ | ---------------------------------------------- | --------------------------------- | ---------
|
|ASSETS                                                                         |                                                |                                   |          
|Rental property                                                                |                                                |                                   |          
|                                                                               | Land and leasehold interests                   |                                   | $        
|                                                                               | Buildings and improvements                     |                                   |          
|                                                                               | Tenant improvements                            |                                   |          
|                                                                               | Furniture, fixtures and equipment              |                                   |          
|                                                                               |                                                |                                   |          
|                                                                               |                                                |                                   | 3,857,657
|                                                                               | Lessaccumulated depreciation and amortization |                                   |          
|                                                                               |                                                |                                   |          
|                                                                               |                                                |                                   | 3,412,088
|                                                                               | Rental property held for sale, net             |                                   |          
|                                                                               |                                                |                                   |          
|                                                                               |                                                | Net investment in rental property |          
|Cash and cash equivalents                                                      |                                                |                                   | 1,167    
|Investments in unconsolidated joint ventures                                   |                                                |                                   | 176,797  
|Unbilled rents receivable, net                                                 |                                                |                                   | 64,759   
|Deferred charges and other assets, net                                         |                                                |                                   | 127,551  
|Restricted cash                                                                |                                                |                                   | 7,777    
|Accounts receivable, net of allowance for doubtful accounts
of $1,856 and $752 |                                                |                                   | 6,290    
|                                                                               |                                                |                                   |          
|Total assets                                                                   |                                                | $                                 | 3,796,429
|                                                                               |                                                |                                   |          
|LIABILITIES AND PARTNERS' CAPITAL                                              |                                                |                                   |          
|Senior unsecured notes                                                         |                                                | $                                 | 1,097,346
|Revolving credit facilities                                                    |                                                |                                   | 73,000   
|Mortgages and loans payable                                                    |                                                |                                   | 582,026  
|Distributions payable                                                          |                                                |                                   | 45,067   
|Accounts payable and accrued expenses                                          |                                                |                                   | 50,774   
|Rents received in advance and security deposits                                |                                                |                                   | 39,038   
|Accrued interest payable                                                       |                                                |                                   | 24,948   
|                                                                               |                                                |                                   |          
|                                                                               |                                                | Total liabilities                 |          
|                                                                               |                                                |                                   |          
|Commitments and contingencies                                                  |                                                |                                   |          
|Partners' Capital:                                                             |                                                |                                   |          
|Preferred units, 215,894 and 220,340 units outstanding                         |                                                |                                   | 221,445  
|General partner, 57,318,478 and 56,712,270 common units outstanding            |                                                |                                   | 1,454,194
|Limited partners, 7,813,806 and 7,954,775 common units outstanding             |                                                |                                   | 208,591  
|Unit warrants, 0 and 2,000,000 outstanding                                     |                                                |                                   |         
|                                                                               |                                                |                                   |          
|                                                                               |                                                | Total partners' capital           |          
|                                                                               |                                                |                                   |          
|Total liabilities and partners' capital                                        |                                                | $                                 | 3,796,429
|                                                                               |                                                |                                   |          

The accompanying notes are an integral part of these consolidated financial statements.

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MACK-CALI REALTY, L.P. AND SUBSIDIARIES    CONSOLIDATED STATEMENTS OF OPERATIONS(in thousands, except per unit amounts)

|                                                                                                                    |                | Year Ended December 31, |        
|------------------------------------------------------------------------------------------------------------------- | -------------- | ----------------------- | -------
|
|REVENUES                                                                                                            |                |                         |        
|Base rents                                                                                                          |                | $                       | 492,417
|Escalations and recoveries from tenants                                                                             |                |                         | 57,057 
|Parking and other                                                                                                   |                |                         | 17,838 
|Interest income                                                                                                     |                |                         | 2,302  
|                                                                                                                    |                |                         |        
|                                                                                                                    | Total revenues |                         |        
|                                                                                                                    |                |                         |        
|EXPENSES                                                                                                            |                |                         |        
|Real estate taxes                                                                                                   |                |                         | 60,836 
|Utilities                                                                                                           |                |                         | 38,844 
|Operating services                                                                                                  |                |                         | 68,449 
|General and administrative                                                                                          |                |                         | 27,054 
|Depreciation and amortization                                                                                       |                |                         | 109,513
|Interest expense                                                                                                    |                |                         | 107,823
|Non-recurring charges                                                                                               |                |                         |       
|                                                                                                                    |                |                         |        
|                                                                                                                    | Total expenses |                         |        
|Equity in earnings of unconsolidated joint ventures                                                                 |                |                         | 14,793 
|                                                                                                                    |                |                         |        
|Income before realized gains (losses) and unrealized losses on disposition of rental property and minority interest |                |                         | 171,888
|Realized gains (losses) and unrealized losses on disposition of rental property, net                                |                |                         | 2,759  
|                                                                                                                    |                |                         |        
|Income before minority interest                                                                                     |                |                         | 174,647
|Minority interest in consolidated partially-owned properties                                                        |                |                         |       
|                                                                                                                    |                |                         |        
|Net income                                                                                                          |                |                         | 174,647
|Preferred unit distributions                                                                                        |                |                         | (15,656
|                                                                                                                    |                |                         |        
|Net income available to common unitholders                                                                          |                | $                       | 158,991
|                                                                                                                    |                |                         |        
|Basic earnings per unit                                                                                             |                | $                       | 2.44   
|Diluted earnings per unit                                                                                           |                | $                       | 2.43   
|Distributions declared per common unit                                                                              |                | $                       | 2.50   
|                                                                                                                    |                |                         |        
|Basic weighted average units outstanding                                                                            |                |                         | 65,109 
|                                                                                                                    |                |                         |        
|Diluted weighted average units outstanding                                                                          |                |                         | 65,427 
|                                                                                                                    |                |                         |        

The accompanying notes are an integral part of these consolidated financial statements.

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MACK-CALI REALTY, L.P. AND SUBSIDIARIES    CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL(in thousands)

|                             |                                                                | Preferred
Units |    | General
Partner
Units |        | Limited
Partner
Units |      | Preferred
Unitholders |         | General
Partner |   | Limited
Partners |          | Unit
Warrants |         | Total   |  
|---------------------------- | -------------------------------------------------------------- | --------------- | -- | --------------------- | ------ | --------------------- | ---- | --------------------- | ------- | --------------- | - | ---------------- | -------- | ------------- | ------- | ------- | -
|Balance at January 1, 2000   |                                                                | 229             |    | 58,447                |        | 8,154                 |      | $                     | 235,200 |                 | $ | 1,441,882        |          | $             | 211,551 |         | $
|                             | Net income                                                     |                 |   |                       |       |                       |     |                       |         | 15,441          |   |                  | 185,338  |               |         | 25,612  |  
|                             | Distributions                                                  |                 |   |                       |       |                       |     |                       |         | (15,441         | ) |                  | (138,585 | )             |         | (19,125 | )
|                             | Conversion of preferred units to limited partner units         |                 | (9 | )                     |       |                       | 258  |                       |         | (9,195          | ) |                  |         |               |         | 9,195   |  
|                             | Redemption of limited partner units for shares of common stock |                 |   |                       | 448    |                       | (448 | )                     |         |                |   |                  | 14,239   |               |         | (14,239 | )
|                             | Contributionsproceeds from stock options exercised            |                 |   |                       | 117    |                       |     |                       |         |                |   |                  | 2,500    |               |         |        |  
|                             | Deferred compensation plan for directors                       |                 |   |                       |       |                       |     |                       |         |                |   |                  | 111      |               |         |        |  
|                             | Amortization of stock compensation                             |                 |   |                       |       |                       |     |                       |         |                |   |                  | 1,672    |               |         |        |  
|                             | Adjustment to fair value of restricted stock                   |                 |   |                       |       |                       |     |                       |         |                |   |                  | 97       |               |         |        |  
|                             | Cancellation of Restricted Stock Awards                        |                 |   |                       | (5     | )                     |     |                       |         |                |   |                  |         |               |         |        |  
|                             | Repurchase of general partner units                            |                 |   |                       | (2,026 | )                     |     |                       |         |                |   |                  | (55,514  | )             |         |        |  
|                             | Stock option charge                                            |                 |   |                       |       |                       |     |                       |         |                |   |                  | 1,550    |               |         |        |  
|                             |                                                                |                 |    |                       |        |                       |      |                       |         |                 |   |                  |          |               |         |         |  
|Balance at December 31, 2000 |                                                                | 220             |    | 56,981                |        | 7,964                 |      |                       | 226,005 |                 |   | 1,453,290        |          |               | 212,994 |         |  
|                             | Net income                                                     |                 |   |                       |       |                       |     |                       |         | 15,644          |   |                  | 131,659  |               |         | 18,531  |  
|                             | Distributions                                                  |                 |   |                       |       |                       |     |                       |         | (15,644         | ) |                  | (139,416 | )             |         | (19,571 | )
|                             | Redemption of limited partner units for shares of common stock |                 |   |                       | 9      |                       | (9   | )                     |         |                |   |                  | 239      |               |         | (239    | )
|                             | Contributionsproceeds from stock options exercised            |                 |   |                       | 904    |                       |     |                       |         |                |   |                  | 20,675   |               |         |        |  
|                             | Deferred compensation plan for directors                       |                 |   |                       |       |                       |     |                       |         |                |   |                  | 156      |               |         |        |  
|                             | Issuance of Restricted Stock Awards                            |                 |   |                       | 95     |                       |     |                       |         |                |   |                  | 41       |               |         |        |  
|                             | Amortization of stock compensation                             |                 |   |                       |       |                       |     |                       |         |                |   |                  | 1,356    |               |         |        |  
|                             | Cancellation of Restricted Stock Awards                        |                 |   |                       | (7     | )                     |     |                       |         |                |   |                  |         |               |         |        |  
|                             | Repurchase of general partner units                            |                 |   |                       | (1,270 | )                     |     |                       |         |                |   |                  | (35,412  | )             |         |        |  
|                             |                                                                |                 |    |                       |        |                       |      |                       |         |                 |   |                  |          |               |         |         |  
|Balance at December 31, 2001 |                                                                | 220             |    | 56,712                |        | 7,955                 |      |                       | 226,005 |                 |   | 1,432,588        |          |               | 211,715 |         |  
|                             | Net income                                                     |                 |   |                       |       |                       |     |                       |         | 15,656          |   |                  | 139,722  |               |         | 19,269  |  
|                             | Distributions                                                  |                 |   |                       |       |                       |     |                       |         | (15,656         | ) |                  | (143,782 | )             |         | (19,648 | )
|                             | Redemption of Preferred Units for limited partner units        |                 | (4 | )                     |       |                       | 128  |                       |         | (4,560          | ) |                  |         |               |         | 4,560   |  
|                             | Redemption of limited partner units for shares of common stock |                 |   |                       | 269    |                       | (269 | )                     |         |                |   |                  | 8,299    |               |         | (8,299  | )
|                             | Redemption of limited partner units for cash                   |                 |   |                       |       |                       | (1   | )                     |         |                |   |                  |         |               |         | (29     | )
|                             | Expiration of Unit Warrants                                    |                 |   |                       |       |                       |     |                       |         |                |   |                  | 7,501    |               |         | 1,023   |  
|                             | Contributionsproceeds from stock options exercised            |                 |   |                       | 646    |                       |     |                       |         |                |   |                  | 17,007   |               |         |        |  
|                             | Proceeds from stock warrants exercised                         |                 |   |                       | 107    |                       |     |                       |         |                |   |                  | 3,547    |               |         |        |  
|                             | Deferred compensation plan for directors                       |                 |   |                       |       |                       |     |                       |         |                |   |                  | 170      |               |         |        |  
|                             | Amortization of stock compensation                             |                 |   |                       |       |                       |     |                       |         |                |   |                  | 1,699    |               |         |        |  
|                             | Repurchase of general partner units                            |                 |   |                       | (416   | )                     |     |                       |         |                |   |                  | (12,557  | )             |         |        |  
|                             |                                                                |                 |    |                       |        |                       |      |                       |         |                 |   |                  |          |               |         |         |  
|Balance at December 31, 2002 |                                                                | 216             |    | 57,318                |        | 7,813                 |      | $                     | 221,445 |                 | $ | 1,454,194        |          | $             | 208,591 |         | $
|                             |                                                                |                 |    |                       |        |                       |      |                       |         |                 |   |                  |          |               |         |         |  

The accompanying notes are an integral part of these consolidated financial statements.

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MACK-CALI REALTY, L.P. AND SUBSIDIARIES    CONSOLIDATED STATEMENTS OF CASH FLOWS(in thousands)

|                                                                                  |                                                     | Year Ended December 31,                                                              |         
|--------------------------------------------------------------------------------- | --------------------------------------------------- | ------------------------------------------------------------------------------------ | --------
|
|CASH FLOWS FROM OPERATING ACTIVITIES                                              |                                                     |                                                                                      |         
|Net income                                                                        |                                                     | $                                                                                    | 174,647 
|Adjustments to reconcile net income to net cash provided by operating activities: |                                                     |                                                                                      |         
|                                                                                  |                                                     | Depreciation and amortization                                                        |         
|                                                                                  |                                                     | Amortization of stock compensation                                                   |         
|                                                                                  |                                                     | Amortization of deferred financing costs and debt discount                           |         
|                                                                                  |                                                     | Stock options charge                                                                 |         
|                                                                                  |                                                     | Equity in earnings of unconsolidated joint ventures                                  |         
|                                                                                  |                                                     | Realized (gains) losses and unrealized losses on disposition of rental property, net |         
|                                                                                  |                                                     | Minority interest in consolidated partially-owned properties                         |         
|Changes in operating assets and liabilities:                                      |                                                     |                                                                                      |         
|                                                                                  |                                                     | Increase in unbilled rents receivable, net                                           |         
|                                                                                  |                                                     | Increase in deferred charges and other assets, net                                   |         
|                                                                                  |                                                     | (Increase) decrease in accounts receivable, net                                      |         
|                                                                                  |                                                     | (Decrease) increase in accounts payable and accrued expenses                         |         
|                                                                                  |                                                     | Increase (decrease) in rents received in advance and security deposits               |         
|                                                                                  |                                                     | (Decrease) increase in accrued interest payable                                      |         
|                                                                                  |                                                     |                                                                                      |         
|                                                                                  | Net cash provided by operating activities           |                                                                                      | $       
|                                                                                  |                                                     |                                                                                      |         
|CASH FLOWS FROM INVESTING ACTIVITIES                                              |                                                     |                                                                                      |         
|Additions to rental property                                                      |                                                     | $                                                                                    | (253,023
|Issuance of mortgage note receivable                                              |                                                     |                                                                                      |        
|Repayment of mortgage note receivable                                             |                                                     |                                                                                      | 3,813   
|Investments in unconsolidated joint ventures                                      |                                                     |                                                                                      | (57,106 
|Distributions from unconsolidated joint ventures                                  |                                                     |                                                                                      | 41,642  
|Proceeds from sales of rental property                                            |                                                     |                                                                                      | 158,188 
|Decrease (increase) in restricted cash                                            |                                                     |                                                                                      | 137     
|                                                                                  |                                                     |                                                                                      |         
|                                                                                  | Net cash (used in) provided by investing activities |                                                                                      | $       
|                                                                                  |                                                     |                                                                                      |         
|CASH FLOWS FROM FINANCING ACTIVITIES                                              |                                                     |                                                                                      |         
|Proceeds from senior unsecured notes                                              |                                                     |                                                                                      |        
|Proceeds from revolving credit facilities                                         |                                                     | $                                                                                    | 495,575 
|Repayments of revolving credit facilities                                         |                                                     |                                                                                      | (482,075
|Proceeds from mortgages and loans payable                                         |                                                     |                                                                                      | 41,749  
|Repayments of mortgages and loans payable                                         |                                                     |                                                                                      | (3,635  
|Repurchase of general partner units                                               |                                                     |                                                                                      | (12,557 
|Payment of financing costs                                                        |                                                     |                                                                                      | (6,971  
|Proceeds from stock options exercised                                             |                                                     |                                                                                      | 17,001  
|Proceeds from stock warrants exercised                                            |                                                     |                                                                                      | 3,546   
|Payment of distributions                                                          |                                                     |                                                                                      | (178,089
|Distributions to minority interest in partially-owned properties                  |                                                     |                                                                                      |        
|                                                                                  |                                                     |                                                                                      |         
|                                                                                  | Net cash used in financing activities               |                                                                                      | $       
|                                                                                  |                                                     |                                                                                      |         
|Net (decrease) increase in cash and cash equivalents                              |                                                     | $                                                                                    | (11,668 
|Cash and cash equivalents, beginning of period                                    |                                                     | $                                                                                    | 12,835  
|                                                                                  |                                                     |                                                                                      |         
|Cash and cash equivalents, end of period                                          |                                                     | $                                                                                    | 1,167   
|                                                                                  |                                                     |                                                                                      |         

The accompanying notes are an integral part of these consolidated financial statements.

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MACK-CALI REALTY, L.P. AND SUBSIDIARIES    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(dollars in thousands, except per share/unit amounts)

1. ORGANIZATION AND BASIS OF PRESENTATION

ORGANIZATION

Mack-Cali Realty, L.P., a Delaware limited partnership, and its subsidiaries (the "Operating Partnership") was formed on May 31, 1994 to
conduct the business of leasing, management, acquisition, development, construction and tenant-related services for its sole general partner, Mack-Cali Realty Corporation and its
subsidiaries (the "Corporation" or "General Partner"). The Operating Partnership, through its operating divisions and subsidiaries, including the Mack-Cali property-owning partnerships and
limited liability companies (collectively, the "Property Partnerships"), as described below, is the entity through which all of the General Partner's operations are conducted.

The
General Partner is a fully integrated, self-administered, self-managed real estate investment trust ("REIT"). The General Partner controls the Operating
Partnership as its sole general partner, and owned an 88.0 percent and 87.7 percent common unit interest in the Operating Partnership as of December 31, 2002 and 2001,
respectively.

The
General Partner's business is the ownership of interests in and operation of the Operating Partnership, and all of the General Partner's expenses are incurred for the benefit of the
Operating Partnership. The General Partner is reimbursed by the Operating Partnership for all expenses it incurs relating to the ownership and operation of the Operating Partnership. The Operating
Partnership earns
a management fee of between three percent and five percent of revenues, as defined, for its management of the Property Partnerships.

As
of December 31, 2002, the Operating Partnership owned or had interests in 265 properties plus developable land (collectively, the "Properties"). The Properties aggregate
approximately 29.3 million square feet, which are comprised of 156 office buildings and 96 office/flex buildings totaling approximately 28.8 million square feet (which include six office
buildings and one office/flex building aggregating 2.1 million square feet owned by unconsolidated joint ventures in which the Operating Partnership has investment interests), six
industrial/warehouse buildings totaling approximately 387,400 square feet, three stand-alone retail properties totaling approximately 118,040 square feet (which include one retail property totaling
approximately 100,740 square feet owned by an unconsolidated joint venture in which the Operating Partnership has an investment interest), one hotel (which is owned by an unconsolidated joint venture
in which the Operating Partnership has an investment interest) and three land leases. The Properties are located in eight states, primarily in the Northeast, plus the District of Columbia.

BASIS OF PRESENTATION

The accompanying consolidated financial statements include all accounts of the Operating Partnership, its majority-owned and/or controlled subsidiaries, which
consist principally of Mack-Cali Realty, L.P. See Investments in Unconsolidated Joint Ventures in Note 2 for the Operating Partnership's treatment of unconsolidated joint venture
interests. All significant intercompany accounts and transactions have been eliminated.

The
preparation of financial statements in conformity with generally accepted accounting principles ("GAAP") requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial

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statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

2. SIGNIFICANT ACCOUNTING POLICIES

|Rental Property |  | Rental properties are stated at cost less accumulated depreciation and amortization. Costs directly related to the acquisition, development and construction of rental properties are capitalized. Capitalized development and construction costs include
pre-construction costs essential to the development of the property, development and construction costs, interest, property taxes, insurance, salaries and other project costs incurred during the period of development. Included in total rental
property is construction and development in-progress of $168,700 and $210,463 (including land of $50,481 and $54,169) as of December 31, 2002 and 2001, respectively. Ordinary repairs and maintenance are expensed as incurred; major replacements
and betterments, which improve or extend the life of the asset, are capitalized and depreciated over their estimated useful lives. Fully-depreciated assets are removed from the accounts.
|--------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                |  | The Operating Partnership considers a construction project as substantially completed and held available for occupancy upon the completion of tenant improvements, but no later than one year from cessation of major construction activity (as
distinguished from activities such as routine maintenance and cleanup). If portions of a rental project are substantially completed and occupied by tenants, or held available for occupancy, and other portions have not yet reached that stage, the
substantially completed portions are accounted for as a separate project. The Operating Partnership allocates costs incurred between the portions under construction and the portions substantially completed and held available for occupancy and
capitalizes only those costs associated with the portion under construction.                                                                                                                      
|                |  | Properties are depreciated using the straight-line method over the estimated useful lives of the assets. The estimated useful lives are as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

| |  | Leasehold interests               |  | Remaining lease term                                       
| |  | --------------------------------- |  | -----------------------------------------------------------
| |  | Buildings and improvements        |  | 5 to 40 years                                              
| |  | Tenant improvements               |  | The shorter of the term of
the related lease or useful life
| |  | Furniture, fixtures and equipment |  | 5 to 10 years                                              



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|                              |  | On a periodic basis, management assesses whether there are any indicators that the value of the Operating Partnership's real estate properties may be impaired. A property's value is impaired only if management's estimate of the aggregate future cash
flows (undiscounted and without interest charges) to be generated by the property are less than the carrying value of the property. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the property
over the fair value of the property. The Operating Partnership's estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions that are subject to economic and market uncertainties including,
among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property. As these factors are difficult to predict and are subject to future events that may alter management's assumptions, the
future cash flows estimated by management in their impairment analyses may not be achieved. Management does not believe that the value of any of the Operating Partnership's rental properties is impaired.
|----------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Rental Property Held for Sale |  | When assets are identified by management as held for sale, the Operating Partnership discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets. If, in management's opinion, the net sales price of the
assets which have been identified for sale is less than the net book value of the assets, a valuation allowance is established. See Note 7.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                              |  | If circumstances arise that previously were considered unlikely and, as a result, the Operating Partnership decides not to sell a property previously classified as held for sale, the property is reclassified as held and used. A property that is
reclassified is measured and recorded individually at the lower of (a) its carrying amount before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property
been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell. See Note 7.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                              |  | Effective January 1, 2002, the Operating Partnership adopted the provisions of Statement of Financial Accounting Standards ("SFAS") No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, which supercedes SFAS No. 121.
SFAS No. 144 requires that long-lived assets that are to be disposed of by sale be measured at the lower of book value or fair value less cost to sell. SFAS No. 144 retains the requirements of SFAS No. 121 regarding impairment loss
recognition and measurement. In addition, it requires that one accounting model be used for long-lived assets to be disposed of by sale and broadens the presentation of discontinued operations to include more disposal transactions. As the statement
requires implementation on a prospective basis, properties which were identified as held for sale by the Operating Partnership prior to January 1, 2002 are presented in the accompanying financial statements in a manner consistent with the prior
year's presentation. As there were no additional properties identified as held for sale during the year ended December 31, 2002, the Operating Partnership did not report any discontinued operations for the periods presented.             
|                              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

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|Investments in Unconsolidated Joint Ventures |  | The Operating Partnership accounts for its investments in unconsolidated joint ventures under the equity method of accounting as the Operating Partnership exercises significant influence, but does not control these entities. These investments are
recorded initially at cost, as Investments in Unconsolidated Joint Ventures, and subsequently adjusted for equity in earnings and cash contributions and distributions.                                                                                                                                                                                                                   
|-------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                             |  | On a periodic basis, management assesses whether there are any indicators that the value of the Operating Partnership's investments in unconsolidated joint ventures may be impaired. An investment is impaired only if management's estimate of the value
of the investment is less than the carrying value of the investment. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the value of the investment. Management does not
believe that the value of any of the Operating Partnership's investments in unconsolidated joint ventures is impaired. See Note 4.
|Cash and Cash Equivalents                    |  | All highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Deferred Financing Costs                     |  | Costs incurred in obtaining financing are capitalized and amortized on a straight-line basis, which approximates the effective interest method, over the term of the related indebtedness. Amortization of such costs is included in interest expense and
was $4,739, $4,638 and $3,943 for the years ended December 31, 2002, 2001 and 2000, respectively.                                                                                                                                                                                                                                                                                      
|Deferred Leasing Costs                       |  | Costs incurred in connection with leases are capitalized and amortized on a straight-line basis over the terms of the related leases and included in depreciation and amortization. Unamortized deferred leasing costs are charged to amortization expense
upon early termination of the lease. Certain employees of the Operating Partnership are compensated for providing leasing services to the Properties. The portion of such compensation, which is capitalized and amortized, approximated $4,083, $4,013
and $3,704 for the years ended December 31, 2002, 2001 and 2000, respectively.                                                
|Restricted Cash                              |  | Restricted cash includes tenant security deposits and escrow and reserve funds for debt service, real estate taxes, property insurance, capital improvements, tenant improvements, and leasing costs established pursuant to certain mortgage financing
arrangements.                                                                                                                                                                                                                                                                                                                                                                            
|                                             |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

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|Derivative Instruments          |  | The Operating Partnership measures derivative instruments, including certain derivative instruments embedded in other contracts, at fair value and records them as an asset or liability, depending on the Operating Partnership's rights or obligations
under the applicable derivative contract. For derivatives designated as fair value hedges, the changes in the fair value of both the derivative instrument and the hedged item are recorded in earnings. For derivatives designated as cash flow hedges,
the effective portions of the derivative are reported in other comprehensive income ("OCI") and are subsequently reclassified into earnings when the hedged item affects earnings. Changes in fair value of derivative instruments not designated as
hedging and ineffective portions of hedges are recognized in earnings in the affected period. See Note 10Interest Rate Contract.
|------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Revenue Recognition             |  | Base rental revenue is recognized on a straight-line basis over the terms of the respective leases. Unbilled rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with the lease
agreements. Parking and other revenue includes income from parking spaces leased to tenants, income from tenants for additional services provided by the Operating Partnership, income from tenants for early lease terminations and income from managing
and/or leasing properties for third parties.                                                                                                                                                                                                                                                                                                                                            
|                                |  | Reimbursements are received from tenants for certain costs as provided in the lease agreements. These costs generally include real estate taxes, utilities, insurance, common area maintenance and other recoverable costs. See Note 17.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Allowance for Doubtful Accounts |  | Management periodically performs a detailed review of amounts due from tenants to determine if accounts receivable balances are impaired based on factors affecting the collectibility of those balances. Management's estimate of the allowance for
doubtful accounts requires management to exercise significant judgment about the timing, frequency and severity of collection losses, which affects the allowance and net income.                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Income and Other Taxes          |  | The Operating Partnership is a partnership and, as a result, all income and losses of the partnership are allocated to the partners for inclusion in their respective income tax returns. Accordingly, no provisions of benefits for income taxes has been
made in the accompanying financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                |  | As of December 31, 2002, the net basis of the rental property for Federal income tax purposes was lower than the net assets as reported in the Operating Partnership's financial statements by approximately $926,991. The Operating Partnership's taxable
income for the years ended December 31, 2002, 2001 and 2000 was approximately $184,783, $179,067 and $163,084, respectively. The differences between book income and taxable income primarily result from differences in depreciation expense, the
recording of rental income, differences in the deductibility of certain expenses for tax purposes, differences in revenue recognition and the rules for tax purposes of a property exchange.                                                                                                                                                                                              
|                                |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

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|Earnings Per Unit     |  | The Operating Partnership presents both basic and diluted earnings per unit ("EPU"). Basic EPU excludes dilution and is computed by dividing net income available to common unitholders by the weighted average number of units outstanding for the
period. Diluted EPU reflects the potential dilution that could occur if securities or other contracts to issue common units were exercised or converted into common units, where such exercise or conversion would result in a lower EPU
amount.                                                                                     
|--------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Distributions Payable |  | The distributions payable at December 31, 2002 represents distributions payable to minority interest common unitholders of record as of January 6, 2003 (65,304,223 common units) and preferred distributions payable to preferred unitholders
(215,894 preferred units) for the fourth quarter 2002. The fourth quarter 2002 common unit distributions of $0.63 per common unit, as well as the fourth quarter preferred unit distribution of $18.1818 per preferred unit, were approved by the Board of
Directors of the Corporation on December 19, 2002 and paid on January 17, 2003.
|                      |  | The distributions payable at December 31, 2001 represents distributions payable to minority interest common unitholders of record as of January 4, 2002 (64,720,615 common units) and preferred distributions payable to preferred unitholders
(220,340 preferred units) for the fourth quarter 2001. The fourth quarter 2001 common unit distributions of $0.62 per common unit, as well as the fourth quarter preferred unit distribution of $17.8932 per preferred unit, were approved by the Board of
Directors of the Corporation on December 18, 2001 and paid on January 22, 2002.
|                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

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|Stock Options |  | With respect to the Corporation's stock options which were granted prior to 2002, the Operating Partnership accounted for stock-based compensation using the intrinsic value method prescribed in Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees," and related Interpretations ("APB No. 25"). Under APB No. 25, compensation cost is measured as the excess, if any, of the quoted market price of the Corporation's stock at the date of grant over
the exercise price of the option granted. Compensation cost for stock options, if any, is recognized ratably over the vesting period. The Corporation's policy is to grant options with an exercise price equal to the quoted closing market price of the
Corporation's stock on the business day preceding the grant date. Accordingly, no compensation cost has been recognized under the Corporation's stock option plans for the granting of stock options made prior to 2002. In 2002, the Operating
Partnership adopted the provisions of Statement of Financial Accounting Standards No. 123, Accounting for Stock Based Compensation ("SFAS No. 123"), which requires, on a prospective basis, that the value of stock options at the grant date
be amortized ratably into expense over the appropriate vesting period. As the Corporation did not grant any stock options in 2002, there was no impact of this adoption to the financial statements. SFAS No. 148, Accounting for Stock-Based
CompensationTransition and Disclosure, was issued in December 2002 and amends SFAS No. 123, Accounting for Stock Based Compensation. SFAS No. 148 provides alternative methods of transition for a voluntary change to the fair value
based method of accounting for stock based compensation. In addition, this Statement amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim financial statements about the method of
accounting for stock-based employee compensation and the effect of the method used on reported results. The transition and disclosure amendments of SFAS No. 148 are effective for fiscal years ending after December 31, 2002. SFAS
No. 148 disclosure requirements are presented as follows:
|------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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The following table illustrates the effect on net income and earnings per unit if the fair value based method had been applied to all outstanding and unvested stock awards in each
period:

|                                                                                                                                            |                       | Year Ended December 31, |        
|------------------------------------------------------------------------------------------------------------------------------------------- | --------------------- | ----------------------- | -------
|
|Net income available to common unitholders, as reported                                                                                     |                       | $                       | 158,991
|Deduct: Total stock based employee compensation expense determined under fair value based method for all awards, net of related tax effects |                       |                         | (2,734 
|                                                                                                                                            |                       |                         |        
|Pro forma net income available to common unitholders                                                                                        |                       | $                       | 156,257
|                                                                                                                                            |                       |                         |        
|Earnings Per Unit:                                                                                                                          |                       |                         |        
|                                                                                                                                            | Basic  as reported   |                         | $      
|                                                                                                                                            | Basic  pro forma     |                         | $      
|                                                                                                                                            | Diluted  as reported |                         | $      
|                                                                                                                                            | Diluted  pro forma   |                         | $      

|Non-Recurring Charges |  | The Operating Partnership considers non-recurring charges as costs incurred specific to significant non-recurring events that impact the comparative measurement of the Operating Partnership's performance. See Note 20.
|--------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Reclassifications     |  | Certain reclassifications have been made to prior period amounts in order to conform with current period presentation.                                                                                                   

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3. REAL ESTATE PROPERTY TRANSACTIONS

2002 TRANSACTIONS

Property Acquisitions

The Operating Partnership acquired the following operating properties during the year ended December 31, 2002:

|Acquisition
Date                    |  | Property/Address           |  | Location                               |  | # of
Bldgs. |  | Rentable
Square Feet |         | Investment by
Operating
Partnership (a)
|----------------------------------- |  | -------------------------- |  | -------------------------------------- |  | ----------- |  | -------------------- | ------- | ---------------------------------------
|Office:                             |  |                            |  |                                        |  |             |  |                      |         |                                        
|08/09/02                            |  | 25 Commerce Drive          |  | Cranford, Union County, NJ             |  | 1           |  | 67,749               |         | $                                      
|08/09/02                            |  | 3 Skyline Drive (b)        |  | Hawthorne, Westchester County, NY      |  | 1           |  | 75,668               |         |                                        
|11/01/02                            |  | 1633 Littleton Road (c)    |  | Parsippany, Morris County, NJ          |  | 1           |  | 57,722               |         |                                        
|11/05/02                            |  | 1266 East Main Street      |  | Stamford, Fairfield County, CT         |  | 1           |  | 179,260              |         |                                        
|12/11/02                            |  | 2200 Renaissance Boulevard |  | King of Prussia, Montgomery County, PA |  | 1           |  | 174,124              |         |                                        
|12/31/02                            |  | 16 & 18 Sentry Park West   |  | Blue Bell, Montgomery County, PA       |  | 2           |  | 188,103              |         |                                        
|                                    |  |                            |  |                                        |  |             |  |                      |         |                                        
|Total Office Property Acquisitions: |  |                            |  | 7                                      |  | 742,626     |  | $                    | 123,470
|                                    |  |                            |  |                                        |  |             |  |                      |         |                                        

---

Land Acquisitions

On June 12, 2002, the Operating Partnership acquired three land parcels located in Hawthorne and Yonkers, Westchester County, New York in one transaction
for a total cost of approximately $2,600. The land was acquired from an entity whose principals include Timothy M. Jones, Robert F. Weinberg and Martin S. Berger, each of whom are affiliated with the
Operating Partnership as the President of the Corporation, a current member of the Board of Directors and a former member of the Board of Directors of the Corporation, respectively. See Note 19
for further discussion of related party transactions.

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Properties Commencing Initial Operations

The following properties commenced initial operations during the year ended December 31, 2002:

|Acquisition
Date                                |  | Property/Address    |  | Location                             |  | # of
Bldgs. |         | Rentable
Square Feet |  | Investment by
Operating
Partnership (a) |           
|----------------------------------------------- |  | ------------------- |  | ------------------------------------ |  | ----------- | ------- | -------------------- |  | --------------------------------------- | ----------
|Office:                                         |  |                     |  |                                      |  |             |         |                      |  |                                         |           
|09/03/02                                        |  | Harborside Plaza 5  |  | Jersey City, Hudson County, NJ       |  | 1           |         | 980,000              |  | $                                       | 196,610 (b
|11/18/02                                        |  | 600 Horizon Drive   |  | Hamilton Township, Mercer County, NJ |  | 1           |         | 95,000               |  |                                         | 7,549     
|                                                |  |                     |  |                                      |  |             |         |                      |  |                                         |           
|Total Office Properties Commencing Operations:  |  | 2                   |  | 1,075,000                            |  | $           | 204,159 |                     
|                                                |  |                     |  |                                      |  |             |         |                      |  |                                         |           
|Office/Flex:                                    |  |                     |  |                                      |  |             |         |                      |  |                                         |           
|04/01/02                                        |  | 125 Clearbrook Road |  | Elmsford, Westchester County, NY     |  | 1           |         | 33,000               |  |                                         | 4,985 (c  
|                                                |  |                     |  |                                      |  |             |         |                      |  |                                         |           
|Total Properties Commencing Initial Operations: |  | 3                   |  | 1,108,000                            |  | $           | 209,144 |                     
|                                                |  |                     |  |                                      |  |             |         |                      |  |                                         |           

---

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Property Sales

The Operating Partnership sold the following properties during the year ended December 31, 2002:

|Sale
Date                    |  | Property/Address           |  | Location                             |  | # of
Bldgs. |  | Rentable
Square Feet |         | Net Sales
Proceeds |        | Net Book
Value |   | Realized
Gain/(Loss) |      
|---------------------------- |  | -------------------------- |  | ------------------------------------ |  | ----------- |  | -------------------- | ------- | ------------------ | ------ | -------------- | - | -------------------- | -----
|Office:                      |  |                            |  |                                      |  |             |  |                      |         |                    |        |                |   |                      |      
|05/13/02                     |  | Dallas Portfolio (a)       |  | Metro Dallas, TX                     |  | 4           |  | 488,789              |         | $                  | 33,115 |                | $ | 34,760               |      
|05/29/02                     |  | 750 South Richfield Street |  | Aurora, Arapahoe County, CO          |  | 1           |  | 108,240              |         |                    | 20,631 |                |   | 21,291               |      
|06/06/02                     |  | Houston Portfolio (b)      |  | Houston, Harris County, TX           |  | 3           |  | 413,107              |         |                    | 25,482 |                |   | 24,393               |      
|07/15/02                     |  | 501 Kennedy Boulevard      |  | Tampa, Hillsborough County, FL       |  | 1           |  | 297,429              |         |                    | 22,915 |                |   | 22,459               |      
|10/16/02                     |  | Arizona Portfolio (c)      |  | Maricopa County, AZ                  |  | 3           |  | 416,967              |         |                    | 42,764 |                |   | 42,719               |      
|                             |  |                            |  |                                      |  |             |  |                      |         |                    |        |                |   |                      |      
|Total Office Property Sales: |  |                            |  | 12                                   |  | 1,724,532   |  | $                    | 144,907 |                    | $      | 145,622        |   | $                    | (715 
|                             |  |                            |  |                                      |  |             |  |                      |         |                    |        |                |   |                      |      
|Residential:                 |  |                            |  |                                      |  |             |  |                      |         |                    |        |                |   |                      |      
|01/30/02                     |  | 25 Martine Avenue          |  | White Plains, Westchester County, NY |  | 1           |  | 124 units            |         |                    | 17,559 |                |   | 10,461               |      
|Other:                       |  |                            |  |                                      |  |             |  |                      |         |                    |        |                |   |                      |      
|04/25/02                     |  | Horizon Center Land        |  | Hamilton Township, Mercer County, NJ |  |            |  | 0.756 acres          |         |                    | 758    |                |   | 41                   |      
|                             |  |                            |  |                                      |  |             |  |                      |         |                    |        |                |   |                      |      
|Total Property Sales:        |  |                            |  | 13                                   |  | 1,724,532   |  | $                    | 163,224 |                    | $      | 156,124        |   | $                    | 7,100
|                             |  |                            |  |                                      |  |             |  |                      |         |                    |        |                |   |                      |      

---



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2001 TRANSACTIONS

Property Acquisitions

The Operating Partnership acquired the following operating properties during the year ended December 31, 2001:

|Acquisition
Date                         |  | Property/Address                          |  | Location                          |  | # of
Bldgs. |        | Rentable
Square Feet |  | Investment by
Operating
Partnership(a)(in thousands)
|---------------------------------------- |  | ----------------------------------------- |  | --------------------------------- |  | ----------- | ------ | -------------------- |  | ----------------------------------------------------
|Office:                                  |  |                                           |  |                                   |  |             |        |                      |  |                                                     
|04/06/01                                 |  | 4 & 6 Campus Drive                        |  | Parsippany, Morris County, NJ     |  | 2           |        | 295,766              |  | $                                                   
|11/06/01                                 |  | 9 Campus Drive (b)                        |  | Parsippany, Morris County, NJ     |  | 1           |        | 156,495              |  |                                                     
|                                         |  |                                           |  |                                   |  |             |        |                      |  |                                                     
|Total Office Property Acquisitions:      |  | 3                                         |  | 452,261                           |  | $           | 63,477
|                                         |  |                                           |  |                                   |  |             |        |                      |  |                                                     
|Office/Flex:                             |  |                                           |  |                                   |  |             |       
|02/14/01                                 |  | 31 & 41 Twosome Drive                     |  | Moorestown, Burlington County, NJ |  | 2           |        | 127,250              |  | $                                                   
|04/27/01                                 |  | 1245 & 1247 N. Church St, 2 Twosome Drive |  | Moorestown, Burlington County, NJ |  | 3           |        | 154,200              |  |                                                     
|08/03/01                                 |  | 5 & 6 Skyline Drive (c)                   |  | Hawthorne, Westchester County, NY |  | 2           |        | 168,177              |  |                                                     
|                                         |  |                                           |  |                                   |  |             |        |                      |  |                                                     
|Total Office/Flex Property Acquisitions: |  | 7                                         |  | 449,627                           |  | $           | 33,084
|                                         |  |                                           |  |                                   |  |             |        |                      |  |                                                     
|Total Property Acquisitions:             |  | 10                                        |  | 901,888                           |  | $           | 96,561
|                                         |  |                                           |  |                                   |  |             |        |                      |  |                                                     

---

Land Acquisitions

On January 5, 2001, the Operating Partnership acquired approximately 7.1 acres of developable land located in Littleton, Arapahoe County, Colorado. The
land was acquired for approximately $2,711.

On
September 13, 2001, the Operating Partnership acquired approximately 5.0 acres of developable land located in Elmsford, Westchester County, New York. The land was acquired for
approximately $1,000 from an entity whose principals include Timothy M. Jones, Robert F. Weinberg and Martin S. Berger, each of whom are affiliated with the Operating Partnership as the President of
the Corporation, a current member of the Board of Directors and a former member of the Board of Directors of the Corporation, respectively. See Note 19. The Operating Partnership completed
construction of a fully pre-leased 33,000 square-foot office/flex building on the acquired land, which commenced initial operations on April 1, 2002.

95

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Properties Commencing Initial Operations

The following properties commenced initial operations during the year ended December 31, 2001:

|Acquisition
Date                                       |  | Property/Address       |  | Location                   |  | # of
Bldgs. |        | Rentable
Square Feet |  | Investment by
Operating
Partnership(a)(in thousands)
|------------------------------------------------------ |  | ---------------------- |  | -------------------------- |  | ----------- | ------ | -------------------- |  | ----------------------------------------------------
|Office:                                                |  |                        |  |                            |  |             |        |                      |  |                                                     
|01/15/01                                               |  | 105 Eisenhower Parkway |  | Roseland, Essex County, NJ |  | 1           |        | 220,000              |  | $                                                   
|03/01/01                                               |  | 8181 East Tufts Avenue |  | Denver, Denver County, CO  |  | 1           |        | 185,254              |  |                                                     
|                                                       |  |                        |  |                            |  |             |        |                      |  |                                                     
|Total Office Properties Commencing Initial Operations: |  | 2                      |  | 405,254                    |  | $           | 82,321
|                                                       |  |                        |  |                            |  |             |        |                      |  |                                                     

---

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Property Sales

The Operating Partnership sold the following properties during the year ended December 31, 2001:

|Sale
Date                    |  | Property/Address          |  | Location                         |  | # of
Bldgs. |  | Rentable
Square
Feet |         | Net Sales
Proceeds |        | Net Book
Value |   | Realized
Gain/(Loss) |       
|---------------------------- |  | ------------------------- |  | -------------------------------- |  | ----------- |  | -------------------- | ------- | ------------------ | ------ | -------------- | - | -------------------- | ------
|Office:                      |  |                           |  |                                  |  |             |  |                      |         |                    |        |                |   |                      |       
|06/01/01                     |  | 1777 N.E. Loop 410        |  | San Antonio, Bexar County, TX    |  | 1           |  | 256,137              |         | $                  | 21,313 |                | $ | 16,703               |       
|06/15/01                     |  | 14511 Falling Creek       |  | Houston, Harris County, TX       |  | 1           |  | 70,999               |         |                    | 2,982  |                |   | 2,458                |       
|07/17/01                     |  | 8214 Westchester          |  | Dallas, Dallas County, TX        |  | 1           |  | 95,509               |         |                    | 8,966  |                |   | 8,465                |       
|08/01/01                     |  | 2600 Westown Parkway      |  | West Des Moines, Polk County, IA |  | 1           |  | 72,265               |         |                    | 5,165  |                |   | 5,570                |       
|09/26/01                     |  | 1709 New York Ave, NW     |  | Washington, DC                   |  | 1           |  | 166,000              |         |                    | 65,151 |                |   | 50,640               |       
|11/14/01                     |  | 200 Concord Plaza Drive   |  | San Antonio, Bexar County, TX    |  | 1           |  | 248,700              |         |                    | 30,927 |                |   | 32,609               |       
|12/21/01                     |  | 5225 Katy Freeway         |  | Houston, Harris County, TX       |  | 1           |  | 112,213              |         |                    | 6,887  |                |   | 7,393                |       
|                             |  |                           |  |                                  |  |             |  |                      |         |                    |        |                |   |                      |       
|Total Office Property Sales: |  |                           |  | 7                                |  | 1,021,823   |  | $                    | 141,391 |                    | $      | 123,838        |   | $                    | 17,553
|                             |  |                           |  |                                  |  |             |  |                      |         |                    |        |                |   |                      |       
|Residential:                 |  |                           |  |                                  |  |             |  |                      |         |                    |        |                |   |                      |       
|06/21/01                     |  | Tenby Chase Apartments    |  | Delran, Burlington County, NJ    |  | 1           |  | 327 units            |         |                    | 19,336 |                |   | 2,399                |       
|Other:                       |  |                           |  |                                  |  |             |  |                      |         |                    |        |                |   |                      |       
|04/03/01                     |  | North Pier-Harborside (a) |  | Jersey City, Hudson County, NJ   |  |            |  | n/a                  |         |                    | 3,357  |                |   | 2,918                |       
|                             |  |                           |  |                                  |  |             |  |                      |         |                    |        |                |   |                      |       
|Total Property Sales:        |  |                           |  | 8                                |  | 1,021,823   |  | $                    | 164,084 |                    | $      | 129,155        |   | $                    | 34,929
|                             |  |                           |  |                                  |  |             |  |                      |         |                    |        |                |   |                      |       

---

4. INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES

The debt of the Operating Partnership's unconsolidated joint ventures aggregating $152,672 as of December 31, 2002 is non-recourse to the
Operating Partnership, except for customary exceptions pertaining to such matters as intentional misuse of funds, environmental conditions and material misrepresentations, and except as otherwise
indicated below.

PRU-BETA 3 (Nine Campus Drive)

On March 27, 1998, the Operating Partnership acquired a 50 percent interest in an existing joint venture with The Prudential Insurance Company of
America ("Prudential"), known as Pru-Beta 3, which owned and operated Nine Campus Drive, a 156,495 square-foot office building, located in the Mack-Cali Business
Campus office complex in Parsippany, Morris County, New Jersey. On November 5, 2001, the Operating Partnership acquired the remaining interest in the property for approximately $15,073. The
property has been consolidated in the Operating Partnership's financial statements subsequent to the acquisition of the remaining interest. The Operating Partnership performed management and leasing
services for the property when it was owned by the joint venture and recognized $162 and $140 in fees for such services in the years ended December 31, 2001 and 2000, respectively.

HPMC

On April 23, 1998, the Operating Partnership entered into a joint venture agreement with HCG Development, L.L.C. and Summit Partners I, L.L.C. to form HPMC
Development Partners, L.P. and, on July 21, 1998, entered into a second joint venture, HPMC Development Partners II, L.P. (formerly known as HPMC Lava Ridge Partners, L.P.), with these same
parties. HPMC Development Partners, L.P.'s efforts focused on two development projects, commonly referred to as Continental Grand II and Summit Ridge. HPMC Development Partners II, L.P.'s efforts have
focused on three development projects, commonly referred to as Lava Ridge, Pacific Plaza I & II and Stadium Gateway.

The
Operating Partnership has a 50 percent ownership interest and HCG Development, L.L.C. and Summit Partners I, L.L.C. (both of which are not affiliated with the Operating
Partnership)

97

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collectively have a 50 percent ownership interest in HPMC Development Partners, L.P. and HPMC Development Partners II, L.P. (the "HPMC Joint Ventures"). Significant terms of the applicable
partnership agreements, among other things, call for the Operating Partnership to provide 80 percent and HCG Development, L.L.C. and Summit Partners I, L.L.C. to collectively provide
20 percent of the development equity capital to the HPMC Joint Ventures. As the Operating Partnership has agreed to fund development equity capital disproportionate to its ownership interest,
it was granted a preferred return of 10 percent on its invested capital as a priority. Profits and losses of each of the HPMC Joint
Ventures are allocated to the partners based upon the priority of distributions specified in the respective agreements and entitle the Operating Partnership to a preferred return, as well as
50 percent of each of the HPMC Joint Ventures' residual profits above the preferred returns. Equity in earnings recognized by the Operating Partnership consists of preferred returns and the
Operating Partnership's equity in the HPMC Joint Ventures' earnings (loss) after giving effect to the HPMC Joint Ventures' payment of such preferred returns.



98

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G&G MARTCO (Convention Plaza)

On April 30, 1998, the Operating Partnership acquired a 49.9 percent interest in an existing joint venture, G&G Martco, which owns Convention Plaza,
a 305,618 square-foot office building, located in San Francisco, San Francisco County, California. A portion of the Operating Partnership's initial investment was financed through the
issuance of common units, as well as funds drawn from the Operating Partnership's credit facilities. On June 4, 1999, the Operating Partnership acquired an additional 0.1 percent
interest in G&G Martco through the issuance of common units. The venture has a mortgage loan with a $50,000 balance at December 31, 2002 secured by its office property. The mortgage bears
interest at a rate of the London Inter-Bank Offered Rate ("LIBOR") (1.38 percent at December 31, 2002) plus 162.5 basis points and matures in August 2003. The loan
provides for a one-year extension option upon payment of a fee and subject to certain conditions. The Operating Partnership has posted a $1,816 letter of credit with the lender as a
reserve for re-leasing costs. The Operating Partnership performs management and leasing services for the property owned by the joint venture and
recognized $254, $235 and $231 in fees for such services in the years ended December 31, 2002, 2001 and 2000, respectively.

AMERICAN FINANCIAL EXCHANGE L.L.C.

On May 20, 1998, the Operating Partnership entered into a joint venture agreement with Columbia Development Company, L.L.C. to form American Financial
Exchange L.L.C. The venture was formed to acquire land for future development, located on the Hudson River waterfront in Jersey City, Hudson County, New Jersey, adjacent to the Operating Partnership's
Harborside Financial Center office complex. The Operating Partnership holds a 50 percent interest in the joint venture. Among other things, the partnership agreement provides for a preferred
return on the Operating Partnership's invested capital in the venture, in addition to the Operating Partnership's proportionate share of the venture's profit, as defined in the agreement. The joint
venture acquired land on which it constructed a parking facility, a portion of which is currently licensed to a parking operator. Such parking facility serves a ferry service between the Operating
Partnership's Harborside property and Manhattan. In the fourth quarter 2000, the joint venture started construction of Plaza 10, a 577,575 square-foot office building, on certain of the
land owned by the venture. Plaza 10 is 100 percent pre-leased to Charles Schwab & Co. Inc. ("Schwab") for a 15-year term. The lease agreement obligates the
venture, among other things, to deliver space to the tenant by required timelines and offers expansion options, at the tenant's election. Such options may obligate the venture to construct an
additional building or, at the Operating Partnership's option, to make space available in any of its existing Harborside properties. Should the venture be unable to or choose not to provide such
expansion space, the venture would be liable to Schwab for its actual damages, in no event to exceed $15,000. The amount of Schwab's actual damages, up to $15,000, has been guaranteed by the Operating
Partnership. The project, which commenced initial operations in September 2002, is currently projected to cost the Operating Partnership approximately $145,000, of which $124,837 has been
incurred by the Operating Partnership through December 31, 2002. The venture has an agreement with the City of Jersey City, New Jersey, in which it is required to make payments in lieu of
property taxes ("PILOT"). The agreement, which commences upon substantial completion of the property, as defined, is for a term of 20 years. The PILOT is equal to two percent of Total Project
Costs, as defined, with periodic increases, as defined. Total Project Costs, per the agreement, are the greater of $78,821 or actual Total Project Costs, as defined.

99

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RAMLAND REALTY ASSOCIATES L.L.C. (One Ramland Road)

On August 20, 1998, the Operating Partnership entered into a joint venture agreement with S.B. New York Realty Corp. to form Ramland Realty Associates
L.L.C. The venture was formed to own, manage and operate One Ramland Road, a 232,000 square-foot office/flex building and adjacent developable land, located in Orangeburg, Rockland County,
New York. In August 1999, the joint venture completed redevelopment of the property and placed the office/flex building in service. The Operating Partnership holds a 50 percent interest
in the joint venture. The venture has a mortgage loan with a $15,282 balance at December 31, 2002 secured by its office/flex property. The mortgage bears interest at a rate of
LIBOR plus 175 basis points and matures in January 2004. The loan provides for a one-year extension option upon payment of a fee and subject to certain conditions. In 2001, the
property's then principal tenant, Superior Bank was closed by the Office of Thrift Supervision, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. The tenant continued to meet
its rental payment obligations through June 2002. In July 2002, the tenant vacated the premises and the FDIC notified the joint venture that it was rejecting the lease as of
July 16, 2002. As a result of the uncertainty regarding the tenant's ability to meet its obligations through the remainder of the term of its lease, the joint venture wrote off unbilled rents
receivable of $1,573 and deferred lease costs of $705, which is included in the Operating Partnership's equity in earnings for the years ended December 31, 2002. The Operating Partnership
performs management, leasing and other services for the property owned by the joint venture and recognized $56, $102 and $198 in fees for such services in the years ended December 31, 2002,
2001 and 2000, respectively.

ASHFORD LOOP ASSOCIATES L.P. (1001 South Dairy Ashford/2100 West Loop South)

On September 18, 1998, the Operating Partnership entered into a joint venture agreement with Prudential to form Ashford Loop Associates L.P. The venture
was formed to own, manage and operate 1001 South Dairy Ashford, a 130,000 square-foot office building acquired on September 18, 1998, and 2100 West Loop South, a 168,000
square-foot office building acquired on November 25, 1998, both located in Houston, Harris County, Texas. The Operating Partnership holds a 20 percent interest in the joint
venture. The Operating Partnership performed management and leasing services through March 2002 for the properties owned by the joint venture and recognized $45, $170 and $172 in fees for such
services in the years ended December 31, 2002, 2001 and 2000, respectively. Under certain circumstances, Prudential has the right to convert its interest in the venture into common stock of the
Corporation at a discount to the stock's fair market value, based on the underlying fair value of Prudential's interest in the venture at the time of conversion. The Operating Partnership, at its
option, can elect to exchange cash in lieu of stock in an amount equal to the fair value of Prudential's interest.

In
May 2002, the Operating Partnership sent a notice to Prudential electing to exercise its option under the buy-sell provisions of the joint venture agreement.
Subsequently, Prudential sent notice to the Operating Partnership that it was exercising its option to put its interest in the joint venture to the Operating Partnership in exchange for common stock
of the Corporation as described above. In November 2002, the Operating Partnership and Prudential entered into a first amendment to their joint venture agreement pursuant to which:
(i) the Operating Partnership retracted its notice of exercise of the buy-sell provisions of the joint venture agreement, (ii) Prudential retracted its notice of exercise of
its option to put its interest in the joint venture to the Operating Partnership in exchange for common stock of the Corporation, as described above, (iii) the mechanics of the exercise by
either party of their respective buy-sell, sale and exchange rights ("Exit Rights") were clarified and confirmed, and (iv) each party agreed to a one-year moratorium on
the exercise of their respective Exit Rights while the parties attempt to reposition the assets of the joint venture.

100

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ARCAP INVESTORS, L.L.C.

In 1999, the Operating Partnership invested $20,000 in ARCap Investors, L.L.C., a joint venture with several participants, which was formed to invest in
sub-investment grade tranches of commercial mortgage-backed securities ("CMBS"). William L. Mack, Chairman of the Board of Directors of the Corporation, is a principal of an entity that
owns approximately 28 percent of the venture and has nominated a member of its board of directors. As of December 31, 2001, the Operating Partnership held a 20.1 percent interest
in the common equity of ARCap Investors, L.L.C. On December 12, 2002, the Operating Partnership sold its interest in the venture for $20,200.

MC-SJP MORRIS V REALTY, LLC AND MC-SJP MORRIS VI REALTY, LLC

The Operating Partnership has an agreement with SJP Properties, which provides for a cooperative effort in seeking approvals to develop up to approximately
1.8 million square feet of office development on certain vacant land owned by the Operating Partnership and SJP Properties, located in Hanover and Parsippany, Morris County, New Jersey. The
agreement provides that the parties share equally in the costs associated with seeking such requisite approvals. Upon mutual consent, the Operating Partnership and SJP Properties may enter into one or
more joint ventures to construct on the vacant land, or seek to dispose of their respective vacant land parcels subject to the agreement. Pursuant to the agreement with SJP Properties, on
August 24, 2000, the Operating Partnership entered into a joint venture with SJP Properties to form MC-SJP Morris V Realty, LLC and MC-SJP Morris VI Realty, LLC, which
acquired developable land for approximately $16,193. The acquired land is able to accommodate approximately 650,000 square feet of office space and is located in Parsippany, Morris County, New Jersey.
The venture entered into an agreement pertaining to the acquired land and two other land parcels in Parsippany with an insurance company to provide for a guarantee on the funding of the development of
four office properties, aggregating 850,000 square feet. Such agreement provides, if the venture elects to develop, that the insurance company will be admitted to the joint venture and provide all the
equity required to fund the development, subject to certain conditions. The venture has a mortgage loan with a $17,983 balance at December 31, 2002 secured by its land, which is guaranteed by
the insurance company. The mortgage bears interest at a rate of LIBOR plus 125 basis points and matures in March 2004.

SOUTH PIER AT HARBORSIDEHOTEL DEVELOPMENT

On November 17, 1999, the Operating Partnership entered into an agreement with Hyatt Corporation ("Hyatt") to develop a 350-room hotel on the
Operating Partnership's South Pier at Harborside Financial Center, Jersey City, Hudson County, New Jersey, which was completed and commenced initial operations in July 2002. The Operating
Partnership owns a 50 percent interest in the venture. The venture has a mortgage loan with a commercial bank with a $61,320 balance at December 31, 2002 secured by its hotel property,
which each partner, including the Operating Partnership, has severally guaranteed repayment of approximately $11,148. The debt bears interest at a rate of LIBOR plus 275 basis points and matures in
December 2003. The loan provides for two one-year extension options upon payment of a fee and subject to certain conditions. Additionally, the venture has an $8,000 loan with the
City of Jersey City, provided by the U.S. Department of Housing and Urban Development. The
loan currently bears interest at fixed rates ranging from 6.09 percent to 6.62 percent and matures in August 2020. The Operating Partnership has posted an $8,000 letter of credit
in support of this loan, $4,000 of which is indemnified by Hyatt.

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SUMMARIES OF UNCONSOLIDATED JOINT VENTURES

The following is a summary of the financial position of the unconsolidated joint ventures in which the Operating Partnership had investment interests as of
December 31, 2002 and 2001:

|                                                                        |                                                  | December 31, 2002
|----------------------------------------------------------------------- | ------------------------------------------------ | -----------------
|
|Assets:                                                                 |                                                  |                  
|                                                                        | Rental property, net                             |                  
|                                                                        | Other assets                                     |                  
|                                                                        |                                                  |                  
|                                                                        | Total assets                                     |                  
|                                                                        |                                                  |                  
|Liabilities and partners'/members' capital:                             |                                                  |                  
|                                                                        | Mortgages and loans payable                      |                  
|                                                                        | Other liabilities                                |                  
|                                                                        | Partners'/members' capital                       |                  
|                                                                        |                                                  |                  
|                                                                        | Total liabilities and partners'/members' capital |                  
|                                                                        |                                                  |                  
|Operating Partnership's net investment in unconsolidated joint ventures |                                                  | $                
|                                                                        |                                                  |                  

|                                                                        |                                                  | December 31, 2001
|----------------------------------------------------------------------- | ------------------------------------------------ | -----------------
|
|Assets:                                                                 |                                                  |                  
|                                                                        | Rental property, net                             |                  
|                                                                        | Other assets                                     |                  
|                                                                        |                                                  |                  
|                                                                        | Total assets                                     |                  
|                                                                        |                                                  |                  
|Liabilities and partners'/members' capital:                             |                                                  |                  
|                                                                        | Mortgages and loans payable                      |                  
|                                                                        | Other liabilities                                |                  
|                                                                        | Partners'/members' capital                       |                  
|                                                                        |                                                  |                  
|                                                                        | Total liabilities and partners'/members' capital |                  
|                                                                        |                                                  |                  
|Operating Partnership's net investment in unconsolidated joint ventures |                                                  | $                
|                                                                        |                                                  |                  

102

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The following is a summary of the results of operations of the unconsolidated joint ventures for the period in which the Operating Partnership had investment interests during the years
ended December 31, 2002, 2001 and 2000:

|                                                                                   |  | Year Ended December 31, 2002 |  
|---------------------------------------------------------------------------------- |  | ---------------------------- | -
|
|Total revenues                                                                     |  | $                            | 
|Operating and other expenses                                                       |  |                              | 
|Depreciation and amortization                                                      |  |                              | 
|Interest expense                                                                   |  |                              | 
|                                                                                   |  |                              |  
|Net income (loss)                                                                  |  | $                            | 
|                                                                                   |  |                              |  
|Operating Partnership's equity in earnings (loss) of unconsolidated joint ventures |  | $                            | 
|                                                                                   |  |                              |  

|                                                                                   |  | Year Ended December 31, 2001 |       
|---------------------------------------------------------------------------------- |  | ---------------------------- | ------
|
|Total revenues                                                                     |  | $                            | 11,337
|Operating and other expenses                                                       |  |                              | (1,322
|Depreciation and amortization                                                      |  |                              | (992  
|Interest expense                                                                   |  |                              |      
|                                                                                   |  |                              |       
|Net income (loss)                                                                  |  | $                            | 9,023 
|                                                                                   |  |                              |       
|Operating Partnership's equity in earnings (loss) of unconsolidated joint ventures |  | $                            | 785   
|                                                                                   |  |                              |       

|                                                                            |  | Year Ended December 31, 2000 |       
|--------------------------------------------------------------------------- |  | ---------------------------- | ------
|
|Total revenues                                                              |  | $                            | 5,075 
|Operating and other expenses                                                |  |                              | (1,619
|Depreciation and amortization                                               |  |                              | (1,226
|Interest expense                                                            |  |                              |      
|                                                                            |  |                              |       
|Net income (loss)                                                           |  | $                            | 2,230 
|                                                                            |  |                              |       
|Operating Partnership's equity in earnings of unconsolidated joint ventures |  | $                            | 935   
|                                                                            |  |                              |       

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5. DEFERRED CHARGES AND OTHER ASSETS

|                                             |  | December 31, |        
|-------------------------------------------- |  | ------------ | -------
|
|Deferred leasing costs                       |  | $            | 119,520
|Deferred financing costs                     |  |              | 23,927 
|                                             |  |              |        
|                                             |  |              | 143,447
|Accumulated amortization                     |  |              | (40,477
|                                             |  |              |        
|Deferred charges, net                        |  |              | 102,970
|Notes receivable                             |  |              | 12,292 
|Prepaid expenses and other assets            |  |              | 12,289 
|                                             |  |              |        
|Total deferred charges and other assets, net |  | $            | 127,551
|                                             |  |              |        

6. RESTRICTED CASH

Restricted cash includes security deposits for the Operating Partnership's residential property and certain commercial properties, and escrow and reserve funds
for debt service, real estate taxes, property insurance, capital improvements, tenant improvements, and leasing costs established pursuant to certain mortgage financing arrangements, and is comprised
of the following:

|                               |  | December 31,
|------------------------------ |  | ------------
|
|Security deposits              |  | $           
|Escrow and other reserve funds |  |             
|                               |  |             
|Total restricted cash          |  | $           
|                               |  |             

7. RENTAL PROPERTY HELD FOR SALE

As of December 31, 2001, the Operating Partnership had identified 37 office properties, aggregating approximately 4.3 million square feet, a
multi-family residential property and a land parcel as held for sale. These properties were located in Texas, Colorado, Arizona, Florida and New York. The properties carried an aggregate book value of
$384,626, net of accumulated depreciation of $28,379 and a valuation allowance of $40,464 at December 31, 2001. During the year ended December 31, 2002, the Operating Partnership sold 13
of these properties for total net sales proceeds of approximately $162,466.

On
June 6, 2002, the Operating Partnership determined that 20 of its office properties and a land parcel, which are located in Colorado, aggregating 1.6 million square
feet, were no longer being held for sale. The Operating Partnership decided that it would continue to own and operate these properties until market conditions in Colorado improve. The reclassified
properties had an aggregate book value of $175,550, net of accumulated depreciation of $15,178 and a valuation allowance of $27,049 at the date of the subsequent decision not to sell (including an
unrealized loss of $3,000, and catch-up
depreciation and amortization expense of $3,900 for certain properties reflecting expense for the period from the date the properties were originally held for sale through the date they were no longer
held for sale, which was recorded at that date).

On
September 30, 2002, the Operating Partnership determined that its five remaining properties located in Texas were no longer being held for sale. The Operating Partnership
decided that it would continue to own and operate these properties until market conditions in Texas improve and certain

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leasing uncertainties at the properties are resolved. The reclassified properties had an aggregate book value of $56,342, net of accumulated depreciation of $7,089 and a valuation allowance of
$1,998, at the date of the subsequent decision not to sell (including catch-up depreciation and amortization expense of $3,413 for certain properties reflecting expense for the period from
the date the properties were originally held for sale through the date they were no longer held for sale, which was recorded at that date).

As
of December 31, 2002, the Operating Partnership did not have any properties identified as held for sale.

During
the years ended December 31, 2002 and 2001, the Operating Partnership determined that the carrying amounts of certain properties identified as held for sale during those
periods were not expected to be recovered from estimated net sale proceeds from such property sales. The Operating Partnership recognized a valuation allowance of $4,341 and $46,793 for the years
ended December 31, 2002 and 2001, respectively.

The
following table summarizes realized gains (losses) and unrealized losses on disposition of rental property, net, for the years ended December 31, 2002, 2001 and 2000:

|                                                                 |  | Year Ended December 31,
|---------------------------------------------------------------- |  | -----------------------
|
|Realized gains (losses) on sale of rental property and land, net |  | $                      
|Valuation allowance on rental property held for sale             |  |                        
|                                                                 |  |                        
|Realized gains (losses) and unrealized losses, net               |  | $                      
|                                                                 |  |                        

8. SENIOR UNSECURED NOTES

A summary of the Operating Partnership's senior unsecured notes as of December 31, 2002 and 2001 is as follows:

|                                                     |  | December 31, |           |  |  
|---------------------------------------------------- |  | ------------ | --------- |  | -
|
|
|7.180% Senior Unsecured Notes, due December 31, 2003 |  | $            | 95,283    |  | $
|7.000% Senior Unsecured Notes, due March 15, 2004    |  |              | 299,904   |  |  
|7.250% Senior Unsecured Notes, due March 15, 2009    |  |              | 298,542   |  |  
|7.835% Senior Unsecured Notes, due December 15, 2010 |  |              | 15,000    |  |  
|7.750% Senior Unsecured Notes, due February 15, 2011 |  |              | 298,602   |  |  
|6.150% Senior Unsecured Notes, due December 15, 2012 |  |              | 90,015    |  |  
|                                                     |  |              |           |  |  
|Total Senior Unsecured Notes                         |  | $            | 1,097,346 |  | $
|                                                     |  |              |           |  |  

---

On
December 20, 2002, the Operating Partnership exchanged $90,000 face amount of existing 7.18 percent senior unsecured notes due December 31, 2003, with interest
payable monthly in arrears, for $94,919 face amount of 6.15 percent senior unsecured notes due December 15, 2012, with interest payable semi-annually in arrears. The exchange
was completed with Teachers Insurance and Annuity Association ("TIAA").

105

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On
January 29, 2001, the Operating Partnership issued $300,000 face amount of 7.75 percent senior unsecured notes due February 15, 2011 with interest payable
semi-annually in arrears. The total proceeds from the issuance (net of selling commissions and discount) of approximately $296,300 were used to pay down outstanding borrowings under the
2000 Unsecured Facility, as defined in Note 9. The senior unsecured notes were issued at a discount of approximately $1,731, which will be amortized over the term as an adjustment to interest
expense.

9. REVOLVING CREDIT FACILITIES

2002 UNSECURED FACILITY

On September 27, 2002, the Operating Partnership obtained an unsecured revolving credit facility ("2002 Unsecured Facility") with a current borrowing
capacity of $600,000 from a group of 14 lenders. The interest rate on outstanding borrowings under the credit line is currently LIBOR plus 70 basis points. The Operating Partnership may instead elect
an interest rate representing the higher of the lender's prime rate or the Federal Funds rate plus 50 basis points. The 2002 Unsecured Facility also requires a 20 basis point facility fee on the
current borrowing capacity payable quarterly in arrears. The 2002 Unsecured Facility matures in September 2005, with an extension option of one year, which would require upon exercise a payment
of 25 basis points of the then borrowing capacity of the credit line.

In
the event of a change in the Operating Partnership's unsecured debt rating, the interest and facility fee rates will be adjusted in accordance with the following table:

|Operating Partnership's
Unsecured Debt Ratings:
S&P/Moody's/Fitch (a) |  | Interest Rate
Applicable Basis Points
Above LIBOR |  | Facility Fee
Basis Points
|--------------------------------------------------------------------- |  | -------------------------------------------------- |  | -------------------------
|No rating or less than BBB-/Baa3/BBB-                                 |  | 120.0                                              |  | 30.0                     
|BBB-/Baa3/BBB-                                                        |  | 95.0                                               |  | 20.0                     
|BBB/Baa2/BBB (current)                                                |  | 70.0                                               |  | 20.0                     
|BBB+/Baa1/BBB+                                                        |  | 65.0                                               |  | 15.0                     
|A-/A3/A- or higher                                                    |  | 60.0                                               |  | 15.0                     

---

The
terms of the 2002 Unsecured Facility include certain restrictions and covenants which limit, among other things, the payment of distributions (as discussed below), the incurrence of
additional indebtedness, the incurrence of liens and the disposition of assets, and which require compliance with financial ratios relating to the maximum leverage ratio, the maximum amount of secured
indebtedness, the minimum amount of tangible net worth, the minimum amount of debt service coverage, the minimum amount of fixed charge coverage, the maximum amount of unsecured indebtedness, the
minimum amount of unencumbered property debt service coverage and certain investment limitations. The distributions restriction referred to above provides that, except to enable the Operating
Partnership to continue to qualify as a REIT under the Code, the Operating Partnership will not during any four consecutive fiscal quarters make distributions with respect to common units or other
equity interests in

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an aggregate amount in excess of 90 percent of funds from operations (as defined) for such period, subject to certain other adjustments.

The
lending group for the 2002 Unsecured Facility consists of: JPMorgan Chase Bank, as administrative agent; Fleet National Bank, as syndication agent; Bank of America and Wells Fargo
Bank, National Association, as co-documentation agents; Commerzbank AG, as co-syndication agent; Bank of Nova Scotia, Bank One, N.A., Citicorp North America, Inc., and
Wachovia Bank, National Association, as managing agents, PNC Bank, National Association, and Sun Trust Bank, as co-agents; Bayerische Landesbank Girozentrale, Deutsche Bank Trust Company
Americas, Chevy Chase Bank, and Israel Discount Bank of New York, as participants.

2000 UNSECURED FACILITY

On June 22, 2000, the Operating Partnership obtained an unsecured revolving credit facility ("2000 Unsecured Facility") with a current borrowing capacity
of $800,000 from a group of 24 lenders. The interest rate on outstanding borrowings under the credit line is currently LIBOR plus 80 basis points. The Operating Partnership may instead elect an
interest rate representing the higher of the lender's prime rate or the Federal Funds rate plus 50 basis points. The 2000 Unsecured Facility also requires a 20 basis point facility fee on the current
borrowing capacity payable quarterly in arrears. Subject to certain conditions, the Operating Partnership has the ability through June 22, 2002 to increase the borrowing capacity of the credit
line up to $1,000,000. The 2000 Unsecured Facility matures in June 2003, with an extension option of one year, which would require a payment of 25 basis points of the then borrowing capacity of
the credit line upon exercise. In conjunction with obtaining the 2002 Unsecured Facility, the Operating Partnership repaid in full and terminated the 2000 Unsecured Facility on September 27,
2002.

In
conjunction with obtaining the 2002 Unsecured Facility, the Operating Partnership drew funds on the new facility to repay in full and terminate the 2000 Unsecured Facility on
September 27, 2002.

UNSECURED FACILITY

The Operating Partnership had an unsecured revolving credit facility ("Unsecured Facility") with a borrowing capacity of $1,000,000 from a group of 28 lenders.
The interest rate was based on the Operating Partnership's achievement of investment grade unsecured debt ratings and, at the Operating Partnership's election, bore interest at either 90 basis points
over LIBOR or the higher of the lender's
prime rate or the Federal Funds rate plus 50 basis points. In conjunction with obtaining the 2000 Unsecured Facility, the Operating Partnership repaid in full and terminated the Unsecured Facility on
June 22, 2000.

PRUDENTIAL FACILITY

The Operating Partnership had a revolving credit facility ("Prudential Facility") with Prudential Securities Corp. ("PSC") in the amount of $100,000, which bore
interest at 110 basis points over one-month LIBOR, with a maturity date of June 29, 2001. The Prudential Facility was a recourse liability of the Operating Partnership and was
secured by the Operating Partnership's equity interest in Harborside Plazas 2 and 3. The Prudential Facility was repaid in full and terminated at maturity on June 29, 2001.

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SUMMARY

As of December 31, 2002 and 2001, the Operating Partnership had outstanding borrowings of $73,000 and $59,500, respectively, under its revolving credit
facilities (with an aggregate borrowing capacity of $600,000 and $800,000, respectively). The total outstanding borrowings as of December 31, 2002 were from the 2002 Unsecured Facility and the
total outstanding borrowings as of December 31, 2001 were from the 2000 Unsecured Facility.

9. MORTGAGES AND LOANS PAYABLE

The Operating Partnership has mortgages and loans payable which consist of various loans collateralized by certain of the Operating Partnership's rental
properties. Payments on mortgages and loans payable are generally due in monthly installments of principal and interest, or interest only.

A
summary of the Operating Partnership's mortgages and loans payable as of December 31, 2002 and 2001 is as follows:

|                                  |  |                              |  |            |         | Principal Balance at |         |        
|--------------------------------- |  | ---------------------------- |  | ---------- | ------- | -------------------- | ------- | -------
|
|Mack-Cali Willowbrook             |  | CIGNA                        |  | 8.67       | %       | $                    | 7,658   |        
|400 Chestnut Ridge                |  | Prudential Insurance Co.     |  | 9.44       | %       |                      | 11,611  |        
|Mack-Cali Centre VI               |  | Principal Life Insurance Co. |  | 6.87       | %       |                      | 35,000  |        
|Various (b)                       |  | Prudential Insurance Co.     |  | 7.10       | %       |                      | 150,000 |        
|Mack-Cali Bridgewater I           |  | New York Life Ins. Co.       |  | 7.00       | %       |                      | 23,000  |        
|Mack-Cali Woodbridge II           |  | New York Life Ins. Co.       |  | 7.50       | %       |                      | 17,500  |        
|Mack-Cali Short Hills             |  | Prudential Insurance Co.     |  | 7.74       | %       |                      | 24,470  |        
|500 West Putnam Avenue            |  | New York Life Ins. Co.       |  | 6.52       | %       |                      | 8,417   |        
|HarborsidePlaza 1                |  | U.S. West Pension Trust      |  | 4.36       | %       |                      | 61,722  |        
|HarborsidePlazas 2 and 3         |  | Northwestern/Principal       |  | 7.36       | %       |                      | 158,140 |        
|1633 Littleton Road               |  | First Union/Maher Partners   |  | 7.66       | %       |                      | 3,504   |        
|Mack-Cali Airport                 |  | Allstate Life Insurance Co.  |  | 7.05       | %       |                      | 10,226  |        
|Kemble Plaza I                    |  | Mitsubishi Tr & Bk Co.       |  | LIBOR+0.65 | %       |                      | 32,178  |        
|2200 Renaissance Boulevard        |  | TIAA                         |  | 5.89       | %       |                      | 19,100  |        
|Soundview Plaza                   |  | TIAA                         |  | 6.02       | %       |                      | 19,500  |        
|                                  |  |                              |  |            |         |                      |         |        
|Total Mortgages and Loans Payable |  |                              |  | $          | 582,026 |                      | $       | 543,807
|                                  |  |                              |  |            |         |                      |         |        

---

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INTEREST RATE CONTRACT

On July 18, 2002, the Operating Partnership entered into a forward treasury rate lock agreement with a commercial bank. The agreement was used to fix the
index rate on $61,525 of the Harborside-Plaza 1 mortgage at 3.285 percent per annum, for which the interest rate was re-set to the three-year U.S. Treasury Note plus 130
basis points for the three years beginning November 4, 2002 (see "Property Mortgages: Harborside-Plaza 1" above). On November 4, 2002, the Operating Partnership paid $1,888 in settlement
of the forward treasury rate lock agreement entered into in July 2002, which is being amortized to interest expense over a three-year period.

SCHEDULED PRINCIPAL PAYMENTS

Scheduled principal payments and related weighted average annual interest rates for the Operating Partnership's Senior Unsecured Notes (see Note 8),
revolving credit facilities (see Note 9) and mortgages and loans payable as of December 31, 2002 are as follows:

|Period                                                                         |  | Scheduled
Amortization |        | Principal
Maturities |   | Total     |  | Weighted Avg.
Interest Rate of
Future Repayments (a) |          
|------------------------------------------------------------------------------ |  | ---------------------- | ------ | -------------------- | - | --------- |  | ---------------------------------------------------- | ---------
|2003                                                                           |  | $                      | 6,916  |                      | $ | 102,093   |  | $                                                    | 109,009  
|2004                                                                           |  |                        | 6,014  |                      |   | 309,863   |  |                                                      | 315,877  
|2005                                                                           |  |                        | 5,420  |                      |   | 326,178   |  |                                                      | 331,598  
|2006                                                                           |  |                        | 1,028  |                      |   | 216,422   |  |                                                      | 217,450  
|2007                                                                           |  |                        | 873    |                      |   | 9,364     |  |                                                      | 10,237   
|Thereafter                                                                     |  |                        | 4,936  |                      |   | 772,173   |  |                                                      | 777,109  
|                                                                               |  |                        |        |                      |   |           |  |                                                      |          
|Sub-total                                                                      |  |                        | 25,187 |                      |   | 1,736,093 |  |                                                      | 1,761,280
|Adjustment for unamortized debt discount/premium, net, as of December 31, 2002 |  |                        | (8,908 | )                    |   |          |  |                                                      | (8,908   
|                                                                               |  |                        |        |                      |   |           |  |                                                      |          
|Totals/Weighted Average                                                        |  | $                      | 16,279 |                      | $ | 1,736,093 |  | $                                                    | 1,752,372
|                                                                               |  |                        |        |                      |   |           |  |                                                      |          

---

CASH PAID FOR INTEREST AND INTEREST CAPITALIZED

Cash paid for interest for the years ended December 31, 2002, 2001 and 2000 was $123,148, $115,722 and $112,157, respectively. Interest capitalized by the
Operating Partnership for the years ended December 31, 2002, 2001 and 2000 was $19,664, $16,722 and $11,524, respectively.

SUMMARY OF INDEBTEDNESS

As of December 31, 2002, the Operating Partnership's total indebtedness of $1,752,372 (weighted average interest rate of 7.03 percent) was comprised
of $105,178 of revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 2.41 percent) and fixed rate debt of $1,647,194 (weighted average rate of
7.33 percent).

As
of December 31, 2001, the Operating Partnership's total indebtedness of $1,700,150 (weighted average interest rate of 7.17 percent) was comprised of $91,678 of revolving
credit facility borrowings and other variable rate mortgage debt (weighted average rate of 3.38 percent) and fixed rate debt of $1,608,472 (weighted average rate of 7.38 percent).

109

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11. PARTNERS' CAPITAL

Partners' capital in the accompanying consolidated financial statements relates to common units held by the Corporation in the Operating Partnership, common units
help by the limited partners, preferred units ("Preferred Units") held by the preferred unitholders of the Operating Partnership and warrants to purchase common units ("Unit Warrants") in the
Operating Partnership.

Net
income allocated to the preferred unitholders and limited partners reflects their pro-rata share of net income and distributions.

REPURCHASE OF GENERAL PARTNER UNITS

On September 13, 2000, the Board of Directors of the Corporation authorized an increase to the Corporation's share repurchase program ("Repurchase
Program") under which the Corporation was
permitted to purchase up to an additional $150,000 of the Corporation's outstanding common stock. The Corporation purchased for constructive retirement 3,711,400 shares of its outstanding common stock
for an aggregate cost of approximately $103,482 from September 13, 2000 through December 31, 2002. Concurrent with these purchases, the Corporation sold to the Operating Partnership
3,711,400 common units for approximately $103,482. From January 1, 2003 through February 14, 2003, the Corporation purchased an additional 35,000 shares of its common stock for an
aggregate cost of approximately $1,030. Concurrent with these purchases, the Corporation sold to the Operating Partnership 35,000 common units for approximately $1,030.

DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN

The Corporation filed a registration statement with the SEC for the Corporation's dividend reinvestment and stock purchase plan ("Plan") which was declared
effective in February 1999. The Plan commenced on March 1, 1999.

SHAREHOLDER RIGHTS PLAN

On June 10, 1999, the Board of Directors of the Corporation authorized a dividend distribution of one preferred share purchase right ("Right") for each
outstanding share of common stock which were distributed to all holders of record of the common stock on July 6, 1999. Each Right entitles the registered holder to purchase from the Corporation
one one-thousandth of a share of Series A junior participating preferred stock, par value $0.01 per share ("Preferred Shares"), at a price of $100.00 per one
one-thousandth of a Preferred Share ("Purchase Price"), subject to adjustment as provided in the rights agreement. The Rights expire on July 6, 2009, unless the expiration date is
extended or the Right is redeemed or exchanged earlier by the Corporation.

The
Rights are attached to each share of common stock. The Rights are generally exercisable only if a person or group becomes the beneficial owner of 15 percent or more of the
outstanding common stock or announces a tender offer for 15 percent or more of the outstanding common stock ("Acquiring Person"). In the event that a person or group becomes an Acquiring
Person, each holder of a Right will have the right to receive, upon exercise, common stock having a market value equal to two times the Purchase Price of the Right.

STOCK OPTION PLANS

In September 2000, the Corporation established the 2000 Employee Stock Option Plan ("2000 Employee Plan") and the 2000 Director Stock Option Plan ("2000
Director Plan"). In May 2002, shareholders of the Corporation approved amendments to both plans to increase the total shares reserved for issuance under both plans from 2,700,000 to 4,350,000
shares (subject to adjustment) of

110

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the Corporation's common stock (from 2,500,000 to 4,000,000 shares under the 2000 Employee Plan and from 200,000 to 350,000 shares under the 2000 Director Plan). In 1994, and as subsequently amended,
the Corporation established the Mack-Cali Employee Stock Option Plan ("Employee Plan") and the Mack-Cali Director Stock Option Plan ("Director Plan") under which a total of
5,380,188 shares (subject to adjustment) of the Corporation's common stock have been reserved for issuance (4,980,188 shares under the Employee Plan and 400,000 shares under the Director Plan). Stock
options granted under the Employee Plan in 1994 and 1995 have become exercisable over a three-year period and those options granted under both the 2000 Employee Plan and Employee Plan
subsequent to 1995 become exercisable over a five-year period. All stock options granted under both the 2000 Director Plan and Director Plan become exercisable in one year. All options
were granted at the fair market value at the dates of grant and have terms of ten years. As of December 31, 2002 and December 31, 2001, the stock options outstanding had a weighted
average remaining contractual life of approximately 6.4 and 7.5 years, respectively.

Information
regarding the Corporation's stock option plans is summarized below:

|                                         |  | Shares
Under
Options |   | Weighted
Average
Exercise
Price
|---------------------------------------- |  | -------------------- | - | -------------------------------
|Outstanding at January 1, 2000           |  | 3,727,151            |   | $                              
|Granted                                  |  | 1,523,900            |   | $                              
|Exercised                                |  | (117,053             | ) | $                              
|Lapsed or canceled                       |  | (500,679             | ) | $                              
|                                         |  |                      |   |                                
|Outstanding at December 31, 2000         |  | 4,633,319            |   | $                              
|Granted                                  |  | 1,045,300            |   | $                              
|Exercised                                |  | (904,401             | ) | $                              
|Lapsed or canceled                       |  | (262,332             | ) | $                              
|                                         |  |                      |   |                                
|Outstanding at December 31, 2001         |  | 4,511,886            |   | $                              
|Granted                                  |  |                     |   |                                
|Exercised                                |  | (646,027             | ) | $                              
|Lapsed or canceled                       |  | (279,929             | ) | $                              
|                                         |  |                      |   |                                
|Outstanding at December 31, 2002         |  | 3,585,930            |   | $                              
|                                         |  |                      |   |                                
|Options Exercisable at December 31, 2001 |  | 1,842,951            |   | $                              
|Options Exercisable at December 31, 2002 |  | 2,553,710            |   | $                              
|                                         |  |                      |   |                                
|Available for grant at December 31, 2001 |  | 1,474,263            |   |                                
|Available for grant at December 31, 2002 |  | 3,402,853            |   |                                
|                                         |  |                      |   |                                

The
weighted average fair value of options granted during 2001 and 2000 were $2.53 and $3.40 per option, respectively. The fair value of each significant option grant is estimated on the
date of grant using the Black-Scholes model. The following weighted average assumptions are included in the Corporation's fair value calculations of stock options:

|                         |  | 2001  |   | 2000  |  
|------------------------ |  | ----- | - | ----- | -
|Expected life (in years) |  | 6     |   | 6     |  
|Risk-free interest rate  |  | 4.99  | % | 5.67  | %
|Volatility               |  | 17.26 | % | 22.66 | %
|Dividend yield           |  | 8.46  | % | 8.82  | %
|                         |  |       |   |       |  

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There
were no stock options granted during 2002.

On
January 22, 2003, the Corporation granted 894,800 employee stock options at an exercise price of $28.47 per share.

STOCK WARRANTS

The Corporation has 252,500 warrants outstanding which enable the holders to purchase an equal number of shares of common stock of the Corporation ("Stock
Warrants") at $33 per share (the market price at date of issuance). Such warrants are all currently exercisable and expire on January 31, 2007.

The
Corporation also has 389,976 Stock Warrants outstanding which enable the holders to purchase an equal number of shares of common stock of the Corporation at $38.75 per share (the
market price at date of issuance). Such warrants are all currently exercisable and expire on December 12, 2007.

Information
regarding the Corporation's Stock Warrants is summarized below:

|                                 |  | Warrants |  
|-------------------------------- |  | -------- | -
|Outstanding at January 1, 2002   |  | 749,976  |  
|Exercised                        |  | (107,500 | )
|Lapsed or canceled               |  |         |  
|                                 |  |          |  
|Outstanding at December 31, 2002 |  | 642,476  |  
|                                 |  |          |  
|Exercisable at December 31, 2002 |  | 642,476  |  
|                                 |  |          |  

STOCK COMPENSATION

The Corporation has granted stock awards to officers and certain other employees of the Corporation (collectively, "Restricted Stock Awards"), which allow the
employees to each receive a certain amount of shares of the Corporation's common stock generally over a five-year vesting period. Certain Restricted Stock Awards are contingent upon the
Corporation meeting certain performance and/or stock price appreciation objectives. All Restricted Stock Awards provided to the officers and certain other employees were granted under the 2000
Employee Plan and Employee Plan.

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Information
regarding the Restricted Stock Awards is summarized below:

|                                 |  | Shares  |  
|-------------------------------- |  | ------- | -
|Outstanding at January 1, 2000   |  | 211,593 |  
|Granted                          |  |        |  
|Vested                           |  | (70,386 | )
|Canceled                         |  | (5,100  | )
|                                 |  |         |  
|Outstanding at December 31, 2000 |  | 136,107 |  
|Granted                          |  | 94,934  |  
|Vested                           |  | (25,354 | )
|Canceled                         |  | (7,408  | )
|                                 |  |         |  
|Outstanding at December 31, 2001 |  | 198,279 |  
|Granted                          |  |        |  
|Vested                           |  | (44,543 | )
|Canceled                         |  |        |  
|                                 |  |         |  
|Outstanding at December 31, 2002 |  | 153,736 |  
|                                 |  |         |  

On
January 2, 2003, the Corporation issued 168,000 shares of Restricted Stock Awards to its five executive officers (Mitchell E. Hersh, Timothy M. Jones, Barry Lefkowitz, Roger W.
Thomas and Michael Grossman) and entered into certain other agreements in connection therewith, as well as certain agreements amending the terms of the restricted share award agreements with such
executive officers originally entered into in 1999 and 2001.

DEFERRED STOCK COMPENSATION PLAN FOR DIRECTORS

The Deferred Compensation Plan for Directors, which commenced January 1, 1999, allows non-employee directors of the Corporation to elect to
defer up to 100 percent of their annual retainer fee into deferred stock units. The deferred stock units are convertible into an equal number of shares of common stock upon the directors'
termination of service from the Board of Directors or a change in control of the Corporation, as defined in the plan. Deferred stock units are credited to each director quarterly using the closing
price of the Corporation's common stock on the applicable dividend record date for the respective quarter. Each participating director's account is also credited for an equivalent amount of deferred
stock units based on the dividend rate for each quarter.

During
the years ended December 31, 2002, 2001 and 2000, 5,324, 5,446 and 4,227 deferred stock units were earned, respectively. As of December 31, 2002 and 2001, there were
18,315 and 12,991 director stock units outstanding, respectively.

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EARNINGS PER UNIT

Basic EPU excludes dilution and is computed by dividing net income available to common unitholders by the weighted average number of units outstanding for the
period. Diluted EPU reflects the potential dilution that could occur if securities or other contracts to issue common units were exercised or converted into common units.

The
following information presents the Operating Partnership's results for the years ended December 31, 2002, 2001 and 2000 in accordance with FASB No. 128:

|                                                                      |  | Year Ended December 31,
|--------------------------------------------------------------------- |  | -----------------------
|
|
|Net income available to common unitholders                            |  | $                      
|Add: Net income attributable to Operating Partnershippreferred units |  |                        
|                                                                      |  |                        
|Adjusted net income                                                   |  | $                      
|                                                                      |  |                        
|Weighted average units                                                |  |                        
|                                                                      |  |                        
|Per Unit                                                              |  | $                      
|                                                                      |  |                        

The
following schedule reconciles the shares used in the basic EPU calculation to the units used in the diluted EPU calculation:

|                                                                              |                         | Year Ended December 31,
|----------------------------------------------------------------------------- | ----------------------- | -----------------------
|
|Basic EPU Units                                                               |                         | 65,109                 
|Add: Operating PartnershipPreferred Units (after conversion to common units) |                         |                       
|                                                                              | Stock options           |                        
|                                                                              | Restricted Stock Awards |                        
|                                                                              | Stock Warrants          |                        
|                                                                              |                         |                        
|Diluted EPU Units                                                             |                         | 65,427                 
|                                                                              |                         |                        

Preferred
Units outstanding in 2002 and 2001 were not included in the 2002 and 2001 computations of diluted EPU as such units were anti-dilutive during the periods.

Through
December 31, 2002, under the Repurchase Program, the Corporation purchased for constructive retirement, a total of 5,580,600 shares of its outstanding common stock for an
aggregate cost of approximately $156,044. Concurrent with these purchases, the Corporation sold an equal number of common units to the Operating Partnership.

12. REDEEMABLE PARTNERSHIP UNITS

Preferred Units

The Preferred Units have a stated value of $1,000 per unit and are preferred as to assets over any class of common units or other class of preferred units of the
Operating Partnership based on circumstances per the applicable unit certificates. The quarterly distribution on each Preferred Unit is an amount equal to the greater of (i) $16.875
(representing 6.75 percent of the Preferred Unit stated value of an annualized basis) or (ii) the quarterly distribution attributable to a Preferred Unit determined as if such unit had
been converted into common units, subject to adjustment for customary anti-dilution rights. Each of the Preferred Units may be converted at any time into common units at a

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conversion price of $34.65 per unit. Common units received pursuant to such conversion may be redeemed for an equal number of shares of common stock. At any time after June 11, 2005, the
Operating Partnership may cause the mandatory conversion of the Preferred Units into common units at the conversion price of $34.65 per unit if, for at least 20 of the prior consecutive
30 days, the closing price of the Corporation's common stock equals or exceeds $34.65. The Operating Partnership is prohibited from taking certain actions that would adversely affect the rights
of the holders of Preferred Units without the consent of at least 662/3 percent of the outstanding Preferred Units, including authorizing, creating or issuing any additional preferred
units ranking senior to or equal with the Preferred Units; provided, however, that such consent is not required if the Corporation issues preferred units ranking equal (but not senior) to the
Preferred Units in an aggregate amount up to the greater of (a) $200,000 in stated value and (b) 10 percent of the sum of (1) the combined market capitalization of the
Corporation's common stock and the Operating Partnership's common and Preferred Units, as converted into common stock, and (2) the aggregate liquidation preference on any
of the Corporation's non-convertible preferred stock or the Operating Partnership's Preferred Units. As of December 31, 2002, the calculation in the above clause (b) was
$216,230.

As
of December 31, 2001, the Operating Partnership had 220,340 Series B Preferred Units outstanding (convertible into 6,359,019 common units).

During
the year ended December 31, 2002, 4,446 Series B Preferred Units were converted into 128,312 common units.

As
of December 31, 2002, there were 215,894 Series B Preferred Units outstanding (convertible into 6,230,707 common units).

Common Units

At January 1, 2001, the Operating Partnership had 7,963,725 common units outstanding.

Certain
individuals and entities own common units in the Operating Partnership. A common unit and a share of common stock of the General Partner have substantially the same economic
characteristics in as much as they effectively share equally in the net income or loss of the Operating Partnership. Common units are redeemable by the common unitholders at their option, subject to
certain restrictions, on the basis of one common unit for either one share of common stock or cash equal to the fair market value of a share at the time of the redemption. The General Partner has the
option to deliver shares of common stock in exchange for all or any portion of the cash requested. The common unitholders may not put the units for cash to the General Partner or the Operating
Partnership. When a unitholder redeems a common unit for common stock of the Corporation, limited partners' capital is reduced and the General Partners' capital is increased.

During
the year ended December 31, 2001, 8,950 common units were redeemed for an equivalent number of shares of common stock of the Corporation.

As
of December 31, 2001, there were 7,954,775 common units outstanding.

During
the year ended December 31, 2002, the Operating Partnership issued 128,312 common units in connection with the conversion of 4,446 Preferred Units, redeemed an aggregate of
268,281 common units for an equivalent number of shares of common stock of the Corporation, and redeemed 1,000 common units for cash.

As
of December 31, 2002, there were 7,813,806 common units outstanding.

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Unit Warrants

The Operating Partnership had 2,000,000 Unit Warrants outstanding which enabled the holders to purchase an equal number of common units at $37.80 per unit, all of
which expired unexercised on December 11, 2002. Upon expiration, the carrying value of the Unit Warrants was allocated on a prorata basis to the general partner and limited partners.

13. MINORITY INTEREST IN CONSOLIDATED PARTIALLY-OWNED PROPERTIES

On December 28, 1999, the Operating Partnership sold an interest in six office properties located in Parsippany, Morris County, New Jersey for $83,600.
Amongst other things, the operating agreements provided for a preferred return to the joint venture members. On June 29, 2000 the Operating Partnership acquired a 100 percent interest in
these properties and the Operating Partnership paid an additional $836 to the minority interest member in excess of its investment.

On
August 24, 2000, MC-SJP Morris V Realty, LLC and MC-SJP Morris VI Realty, LLC acquired land in which SJP Properties has a minority interest amounting to
$1,925.

The
Operating Partnership controlled these operations and has consolidated the financial position and results of operations of partially-owned properties in the financial statements of
the Operating Partnership. The equity interests of the other members are reflected as minority interests: partially-owned properties in the consolidated financial statements of the Operating
Partnership.

14. EMPLOYEE BENEFIT PLAN

All employees of the Operating Partnership who meet certain minimum age and period of service requirements are eligible to participate in a 401(k) defined
contribution plan (the "401(k) Plan"). The 401(k) Plan allows eligible employees to defer up to 15 percent of their annual compensation, subject to certain limitations imposed by federal law.
The amounts contributed by employees are immediately vested and non-forfeitable. The Operating Partnership, at management's discretion, may match
employee contributions and/or make discretionary contributions. Management has approved, for the year ended December 31, 2002, a Operating Partnership matching contribution to be paid under the
401(k) Plan equal to 50 percent of the first 3.5 percent of annual salary, as defined in the 401(k) Plan, contributed to the plan in 2002. Total expense recognized by the Operating
Partnership for the years ended December 31, 2002, 2001 and 2000 was $313, $400 and $0, respectively.

15. DISCLOSURE OF FAIR VALUE OF FINANCIAL INSTRUMENTS

The following disclosure of estimated fair value was determined by management using available market information and appropriate valuation methodologies. However,
considerable judgement is necessary to interpret market data and develop estimated fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Operating
Partnership could realize on disposition of the financial instruments at December 31, 2002 and 2001. The use of different market assumptions and/or estimation methodologies may have a material
effect on the estimated fair value amounts.

Cash
equivalents, receivables, accounts payable, and accrued expenses and other liabilities are carried at amounts which reasonably approximate their fair values as of
December 31, 2002 and 2001.

The
estimated fair value (excluding prepayment penalties) of the Senior Unsecured Notes and mortgages and loans payable as of December 31, 2002 approximated the carrying values of
$1,205,607 and $560,572, respectively, and as of December 31, 2001 approximated the carrying values of $1,126,759

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and $518,555, respectively, based upon then current interest rates for debt with similar terms and remaining maturities. Revolving credit facility borrowings as of December 31, 2002 and 2001
approximated the carrying values of $73,000 and $59,500, respectively.

Disclosure
about fair value of financial instruments is based on pertinent information available to management as of December 31, 2002 and 2001. Although management is not aware
of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since December 31, 2002 and
current estimates of fair value may differ significantly from the amounts presented herein.

16. COMMITMENTS AND CONTINGENCIES

TAX ABATEMENT AGREEMENTS

Harborside Financial Center

Pursuant to an agreement with the City of Jersey City, New Jersey, the Operating Partnership is required to make payments in lieu of property taxes ("PILOT") on
its Harborside Plaza 2 and 3 properties. The agreement, which commenced in 1990, is for a term of 15 years. Such PILOT is equal to two percent of Total Project Costs, as defined, in year one
and increases by $75 per annum through year 15. Total Project Costs, as defined, are $145,644. The PILOT totaled $3,763, $3,688 and $3,613 for the years ended December 31, 2002, 2001 and 2000,
respectively. The PILOT on these two properties has been challenged as part of a larger effort by several neighboring towns to question past practices of the City of Jersey City in attracting large
development. If this challenge is successful, the properties will be placed back on the regular tax roles for tax years beginning with 1998. While the Operating Partnership cannot at this time
determine the likely outcome of this challenge, the effect, if successful, of the challenge on the tax assessments against the properties, or the amount of the increase, if any, in taxes assessed
resulting from a successful challenge, the Operating Partnership does not believe that the outcome will result in a material adverse impact to the Operating Partnership as there is the potential that
the majority of any increase in the expense at the properties may be passed along to the properties' tenants.

The
Operating Partnership entered into a similar PILOT agreement with the City of Jersey City, New Jersey on its Harborside Plaza 4-A property. The agreement, which commenced
in 2000, is for a term of 20 years. The PILOT is equal to two percent of Total Project costs, as defined, and increases by 10 percent in years 7, 10 and 13 and by 50 percent in
year 16. Total Project costs, as defined, are $45,497. The PILOT totaled $910, $891 and $86 for the years ended December 31, 2002, 2001 and 2000, respectively.

Additionally,
the Operating Partnership entered into a similar PILOT agreement with the City of Jersey City, New Jersey on its Harborside Plaza 5 property. The agreement, which commences
upon substantial completion of the property, as defined, is for a term of 20 years. The PILOT is equal to two percent of Total Project Costs, as defined, and increases by 10 percent in
years 7, 10 and 13, and by 50 percent in year 16. Total Project Costs, per the agreement, are the greater of $132,294 or actual Total Project Costs, as defined. The PILOT totaled $867, $0 and
$0 for the years ended December 31, 2002, 2001 and 2000, respectively.

The
Operating Partnership is a defendant in other litigation arising in the normal course of business activities. Management does not believe that the ultimate resolution of these
matters will have a materially adverse effect upon the Operating Partnership.

117

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GROUND LEASE AGREEMENTS

Future minimum rental payments under the terms of all non-cancelable ground leases under which the Operating Partnership is the lessee, as of
December 31, 2002, are as follows:

|Year              |  | Amount
|----------------- |  | ------
|2003              |  | $     
|2004              |  |       
|2005              |  |       
|2006              |  |       
|2007              |  |       
|2008 through 2080 |  |       
|                  |  |       
|Total             |  | $     
|                  |  |       

Ground
lease expense incurred during the years ended December 31, 2002, 2001 and 2000 amounted to $591, $569 and $570, respectively.

OTHER

The Operating Partnership may not dispose of or distribute certain of its properties, currently comprising 141 properties with an aggregate net book value of
approximately $1,845,004, which were originally contributed by members of either the Mack Group (which includes William L. Mack, Chairman of the Corporation's Board of Directors; Earle I. Mack,
director; and Mitchell E. Hersh, chief executive officer and director), the Robert Martin Group (which includes Robert F. Weinberg, director; Martin W. Berger, a former director; and Timothy M. Jones,
president) or the Cali Group
(which includes John J. Cali, director and John R. Cali, director) without the express written consent of a representative of the Mack Group, the Robert Martin Group or the Cali Group, as applicable,
except in a manner which does not result in recognition of any built-in-gain (which may result in an income tax liability) or which reimburses the appropriate Mack Group,
Robert Martin Group or Cali Group members for the tax consequences of the recognition of such built-in-gains (collectively, the "Property Lock-Ups"). The
aforementioned restrictions do not apply in the event that the Operating Partnership sells all of its properties or in connection with a sale transaction which the Corporation's Board of Directors
determines is reasonably necessary to satisfy a material monetary default on any unsecured debt, judgment or liability of the Operating Partnership or to cure any material monetary default on any
mortgage secured by a property. The Property Lock-Ups expire periodically through 2008. Upon the expiration of the Property Lock-Ups, the Operating Partnership is required to
use commercially reasonable efforts to prevent any sale, transfer or other disposition of the subject properties from resulting in the recognition of built-in gain to the appropriate Mack
Group, Robert Martin Group or Cali Group members.

17. TENANT LEASES

The Properties are leased to tenants under operating leases with various expiration dates through 2018. Substantially all of the leases provide for annual base
rents plus recoveries and escalation charges based upon the tenant's proportionate share of and/or increases in real estate taxes and certain operating costs, as defined, and the pass through of
charges for electrical usage.

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Future
minimum rentals to be received under non-cancelable operating leases at December 31, 2002 are as follows:

|Year       |  | Amount
|---------- |  | ------
|2003       |  | $     
|2004       |  |       
|2005       |  |       
|2006       |  |       
|2007       |  |       
|Thereafter |  |       
|           |  |       
|Total      |  | $     
|           |  |       

18. SEGMENT REPORTING

The Operating Partnership operates in one business segmentreal estate. The Operating Partnership provides leasing, management, acquisition,
development, construction and tenant-related services for its portfolio. The Operating Partnership does not have any foreign operations. The accounting policies of the segments are the same as those
described in Note 2, excluding straight-line rent adjustments, depreciation and amortization and non-recurring charges.

The
Operating Partnership evaluates performance based upon net operating income from the combined properties in the segment.

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Selected results of operations for the years ended December 31, 2002, 2001 and 2000 and selected asset information as of December 31, 2002 and 2001 regarding the Operating
Partnership's operating segment are as follows:

|                                           |      | Total Segment |   | Corporate & Other (e) |  | Total Operating
Partnership |          |  
|------------------------------------------ | ---- | ------------- | - | --------------------- |  | --------------------------- | -------- | -
|Total contract revenues (a)                |      |               |   |                       |  |                             |          |  
|                                           | 2002 |               | $ | 558,809               |  | $                           | 1,276    |  
|                                           | 2001 |               |   | 560,680               |  |                             | 3,265    |  
|                                           | 2000 |               |   | 551,687               |  |                             | 3,807    |  
|Total operating and interest expenses (b): |      |               |   |                       |  |                             |          |  
|                                           | 2002 |               | $ | 220,148               |  | $                           | 82,858   |  
|                                           | 2001 |               |   | 179,210               |  |                             | 135,969  |  
|                                           | 2000 |               |   | 174,116               |  |                             | 126,700  |  
|Equity in earnings:                        |      |               |   |                       |  |                             |          |  
|                                           | 2002 |               | $ | 10,403                |  | $                           | 4,390    |  
|                                           | 2001 |               |   | 8,729                 |  |                             | 275      |  
|                                           | 2000 |               |   | 6,055                 |  |                             | 2,000    |  
|Net operating income (c):                  |      |               |   |                       |  |                             |          |  
|                                           | 2002 |               | $ | 349,064               |  | $                           | (77,192  | )
|                                           | 2001 |               |   | 390,199               |  |                             | (132,429 | )
|                                           | 2000 |               |   | 383,626               |  |                             | (120,893 | )
|Total assets:                              |      |               |   |                       |  |                             |          |  
|                                           | 2002 |               | $ | 3,761,665             |  | $                           | 34,764   |  
|                                           | 2001 |               |   | 3,710,411             |  |                             | 36,359   |  
|Total long-lived assets (d):               |      |               |   |                       |  |                             |          |  
|                                           | 2002 |               | $ | 3,648,390             |  | $                           | 5,254    |  
|                                           | 2001 |               |   | 3,595,012             |  |                             | 24,349   |  

---

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19.  RELATED PARTY TRANSACTIONS

William L. Mack, Chairman of the Board of Directors of the Corporation ("W. Mack"), is a principal in the Apollo real estate funds, which owns approximately a
7.5 percent interest in Insignia/ESG, Inc. ("Insignia"), a publicly-traded commercial leasing and real estate services company. The Operating Partnership has paid Insignia commissions on
numerous leasing transactions, as well as for the sale of five of its properties. The Operating Partnership paid commissions to Insignia amounting to approximately $1,975, $2,750 and $4,801 for the
years ended December 31, 2002, 2001 and 2000, respectively. In addition, American Financial Exchange, an unconsolidated joint venture in which the Operating Partnership has a 50 percent
interest, paid Insignia approximately $0, $1,305 and $3,027 in commissions for the years ended December 31, 2002, 2001 and 2000, respectively. The Operating Partnership had engaged Insignia as
its exclusive leasing agent at Harborside Financial Center through late 2002. Additionally, an affiliate of Insignia leased 40,504 square feet at one of the Operating Partnership's office properties,
which was sold by the Operating Partnership in May 2002. The Operating Partnership recognized $386, $836 and $880, respectively, in revenue under this lease for the years ended
December 31, 2002, 2001 and 2000, and had no accounts receivable as of December 31, 2002 and 2001.

W.
Mack and Earle I. Mack, a director of the Corporation ("E. Mack"), are the executive officers, directors and stockholders of a corporation that entered into a lease in 2000 at one of
the Operating Partnership's office properties for approximately 7,801 square feet, which is scheduled to expire in November 2005. The Operating Partnership has recognized $220, $217 and $29 in
revenue under this lease for the years ended December 31, 2002, 2001 and 2000, respectively, and had accounts receivable of $1 and $0, respectively, from the corporation as of
December 31, 2002 and 2001.

In
connection with the Mack transaction in December 1997, the Operating Partnership agreed to provide certain services through December 2000 to an entity, whose principals
include W. Mack and E. Mack. The Operating Partnership recognized revenue of $0, $0 and $958 for the years ended December 31, 2002, 2001 and 2000, respectively, under this agreement.

The
Operating Partnership has conducted business with certain entities ("RMC Entity" or "RMC Entities"), whose principals include Timothy M. Jones, Robert F. Weinberg and Martin S.
Berger, each of whom are affiliated with the Operating Partnership as the president of the Corporation, a current member of the Board of Directors and a former director of the Board of Directors of
the Corporation. In connection with the Operating Partnership's acquisition of 65 Class A properties from The Robert Martin Company ("Robert Martin") on January 31, 1997, as subsequently
modified, the Operating
Partnership granted Robert Martin the right to designate one seat on the Corporation's Board of Directors ("RM Board Seat"), which right has since expired. Robert Martin designated Martin S. Berger
and Robert F. Weinberg to jointly share the RM Board Seat, as follows: Mr. Weinberg served as a member of the Board of Directors of the Corporation from 1997 until December 1, 1998, at
which time Mr. Weinberg resigned and Mr. Berger was appointed to serve in such capacity. Mr. Berger served as a member of the Board of Directors of the Corporation from
December 1, 1998 until March 6, 2001, at which time Mr. Berger resigned and Mr. Weinberg was appointed to serve in such capacity until the Corporation's 2003 annual meeting
of stockholders. If the Corporation elects to nominate for re-election to its Board of Directors a designee of Robert Martin at the Corporation's 2003 annual meeting of stockholders, then
Mr. Berger and Mr. Weinberg have agreed that Mr. Berger will be so nominated and the seat will be rotated among Mr. Berger and Mr. Weinberg every 12 months
commencing on the 12 month anniversary of the 2003 annual meeting of stockholders. Upon the death of Mr. Berger or Mr. Weinberg, the surviving person shall solely fill the
remainder of the term of the RM Board Seat. Such business was as follows:



121

---



Mr. Berger
holds a 24 percent interest, acts as chairman and chief executive officer, Mr. Weinberg also holds a 24 percent interest and is a director, and W.
Mack holds a nine percent interest and is director of City and Suburban Federal Savings Bank and/or one of its affiliates, which leases a total of 15,879 square feet of space at two of the Operating
Partnership's office properties, comprised of 3,037 square feet scheduled to expire in June 2008 and 12,842 square feet scheduled to expire in April 2013. The Operating Partnership has
recognized $306, $295 and $283 in revenue under the leases for the years ended December 31, 2002, 2001 and 2000, respectively, and had no accounts receivable from the company as of
December 31, 2002 and 2001.

Vincent
Tese, a director of the Corporation, is also currently a director of Cablevision, Inc. who, through its affiliates, leases an aggregate of 58,885 square feet of office
space, as well as has several telecom licensing agreements at the Operating Partnership's properties. The Operating Partnership recognized approximately $1,464, $1,101 and $596 in total revenue from
affiliates of Cablevision for the years ended December 31, 2002, 2001 and 2000, respectively, and had accounts receivable of $0 and $7, respectively, as of December 31, 2002 and 2001.

122

---

W.
Mack and Vincent Tese are both currently members of the Board of Directors of Bear Stearns & Co. Inc. Roy Zuckerberg, a director of the Corporation, is also currently on
the Board of Directors of Goldman Sachs & Co. Bear Stearns and Goldman Sachs have both acted as underwriters on several of the Operating Partnership's previously-completed public debt
offerings.

The
son of a former director of the Corporation, who was also a former officer of the Operating Partnership, served as an officer and continues to have a financial interest in a company
which provides
cleaning and other related services to certain of the Operating Partnership's properties. The Operating Partnership has incurred costs from this company of approximately $5,648, $4,674 and $3,164 for
the years ended December 31, 2002, 2001 and 2000, respectively. As of December 31, 2002 and 2001, respectively, the Operating Partnership had accounts payable of approximately $0 and $4
to this company.

Pursuant
to an agreement between the Operating Partnership and certain members and associates of the Cali family executed June 27, 2000, John J. Cali is to serve as the Chairman
Emeritus and a Board member of the Corporation, and as a consultant to the Operating Partnership and is paid an annual salary of $150 from June 27, 2000 through June 27, 2003.
Additionally, the Operating Partnership provides office space and administrative support to John J. Cali, Angelo Cali, his brother, and Ed Leshowitz, his business partner. Such services are in effect
from June 27, 2000 through June 27, 2004.

20.  NON-RECURRING CHARGES

On June 27, 2000, both Brant Cali and John R. Cali resigned their positions as officers of the Corporation and Brant Cali resigned as a director of the
Corporation. John R. Cali was appointed to the Board of Directors of the Corporation to take the seat previously held by Brant Cali. As required by Brant Cali and John R. Cali's employment agreements
with the Operating Partnership: (i) the Operating Partnership paid $2,820 and $2,806 (less applicable withholding) to Brant Cali and John R. Cali, respectively; (ii) all options to
acquire shares of the Corporation's common stock and Restricted Stock Awards (as hereinafter defined) held by Brant Cali and John R. Cali became fully vested on the effective date of their
resignations from the Operating Partnership. All costs associated with Brant Cali and John R. Cali's resignations, which totaled approximately $9,228, are included in non-recurring charges
for the year ended December 31, 2000.

On
September 21, 2000, the Operating Partnership and Prentiss Properties Trust, a Maryland REIT ("Prentiss"), mutually agreed to terminate the agreement and plan of merger
("Merger Agreement") dated as of June 27, 2000, among the Corporation, the Operating Partnership, Prentiss and Prentiss Properties Acquisition Partners, L.P., a Delaware limited partnership of
which Prentiss (through a wholly-owned direct subsidiary) is the sole general partner ("Prentiss Partnership"). In connection with such termination, the Operating Partnership deposited $25,000 into
escrow for the benefit of Prentiss and Prentiss Partnership. This cost and approximately $2,911 of other costs associated with the termination of the Merger Agreement are included in
non-recurring charges for the year ended December 31, 2000. Simultaneous with the termination, the Operating Partnership sold to Prentiss its 270,703 square-foot Cielo
Center property located in Austin, Travis County, Texas, and recognized a gain of approximately $10,036.

123

---

The
Operating Partnership had no non-recurring charges for the years ended December 31, 2002 and 2001. The components of the Operating Partnership's
non-recurring charges for the year ended December 31, 2000 is as follows:

|Amount deposited into escrow for the benefit of Prentiss and Prentiss Partnership in connection with the termination of the Prentiss Merger Agreement |  | $ | 25,000 |  |   |       
|----------------------------------------------------------------------------------------------------------------------------------------------------- |  | - | ------ |  | - | ------
|Legal and other costs associated with the termination of the Prentiss Merger Agreement                                                                |  |   | 2,911  |  |   |       
|                                                                                                                                                      |  |   |        |  |  
|Total non-recurring charges in connection with termination of the Prentiss Merger Agreement                                                           |  |   |        |  | $ | 27,911
|Payment per Employment Agreement to Brant Cali in connection with his resignation                                                                     |  |   | 2,820  |  |   |       
|Payment per Employment Agreement to John R. Cali in connection with his resignation                                                                   |  |   | 2,806  |  |   |       
|Stock options charge in connection with change to Brant Cali's options outstanding in connection with his resignation                                 |  |   | 1,550  |  |   |       
|Restricted stock accelerated vesting in connection with resignations of Brant Cali and John R. Cali                                                   |  |   | 1,097  |  |   |       
|Legal and other costs associated with Brant Cali and John R. Cali's resignations                                                                      |  |   | 955    |  |   |       
|                                                                                                                                                      |  |   |        |  |  
|Total non-recurring charges in connection with resignations of Brant Cali and John R. Cali                                                            |  |   | 9,228  |  |   |       
|                                                                                                                                                      |  |   |        |  |  
|Total non-recurring charges for the year ended December 31, 2000                                                                                      |  |   |        |  | $ | 37,139
|                                                                                                                                                      |  |   |        |  |  

21.  IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

SFAS No. 145

In April 2002, the Financial Accounting Standards Board ("FASB") issued SFAS No. 145, Rescission of SFAS No. 4, 44, and 64, Amendment of FASB
No. 13 and Technical Corrections. This statement eliminates the requirement to report gains and losses from extinguishment of debt as extraordinary unless they meet the criteria of APB Opinion
30. Debt extinguishments that were classified as extraordinary in prior periods presented that do not meet the criteria of APB Opinion 30 shall be reclassified. SFAS No. 145 is effective for
fiscal years beginning after May 15, 2002. The impact of the
adoption of SFAS No. 145 is not expected to have a material impact on the Operating Partnership's financial position or results of operations.

SFAS No. 146

SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities, was recently issued in July 2002 and nullifies EITF
94-3, Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring).

The
principal difference between SFAS No. 146 and EITF 94-3 relates to its requirements for recognition of a liability for a cost associated with an exit or disposal
activity. SFAS 146 requires that a liability for a cost associated with an exit or disposal activity be recognized when the liability is incurred. Under EITF 94-3, a liability for
an exit cost as defined in EITF 94-3 was recognized at the date of an entity's commitment to an exit plan. A fundamental conclusion reached by the Board in FAS 146 is that an
entity's commitment to a plan, by itself, does not create a present obligation to others that meets the definition of a liability. Therefore, SFAS 146 eliminates the definition and requirements
for recognition of exit costs in EITF 94-3 and also establishes that fair value is the objective for initial measurement of the liability.

124

---

The
provisions of SFAS No. 146 shall be effective for exit or disposal activities initiated after December 31, 2002. Previously issued financial statements shall not be
restated. For purposes of SFAS No. 146, an exit or disposal activity is initiated when management, having the authority to approve the action, commits to an exit or disposal plan or otherwise
disposes of a long-lived asset (disposal group) and, if the activity involves the termination of employees, the criteria for a plan of termination in SFAS No. 146. The Operating
Partnership is evaluating the potential impact of the adoption of FASB No. 146 on the Operating Partnership's financial position or results of operations.

FASB Interpretation No. 45

In November 2002, the FASB issued Interpretation No. 45, Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others, which changes the accounting for, and disclosure of certain guarantees. Beginning with transactions entered into after December 31, 2002, certain
guarantees are to be recorded at fair value, which is different from prior practice, under which a liability was recorded only when a loss was probable and reasonably estimable. In general, the change
applies to contracts or indemnification agreements that contingently require the Operating Partnership to make payments to a guaranteed third-party based on changes in an underlying asset, liability,
or an equity security of the guaranteed party.

While
the accounting provisions only apply for new transactions entered into after December 31, 2002, the Interpretation requires the Operating Partnership to include, and the
Operating Partnership has included, new disclosures in these financial statements.

FASB Interpretation No. 46

On January 17, 2003, the FASB issued Interpretation No. 46, Consolidation of Variable Interest Entities ("FIN 46"), the primary objective of which
is to provide guidance on the identification of entities for which control is achieved through means other than voting rights ("variable interest entities" or "VIEs") and to determine when and which
business enterprise should consolidate the VIE (the "primary beneficiary"). This new model applies when either (1) the equity investors (if any) do not have a controlling financial interest or
(2) the equity investment at risk is insufficient to finance that entity's activities without additional financial support. In addition, FIN 46 requires additional disclosures. The Operating
Partnership is assessing the impact of this interpretation on its accounting for investments in unconsolidated joint ventures (see Note 4).

125

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22.  CONDENSED QUARTERLY FINANCIAL INFORMATION(unaudited)

The
following summarizes the condensed quarterly financial information for the Operating Partnership:

|Quarter Ended 2002:                                                                           |                | December 31 |         | September 30 |   | June 30 |         | March 31 |        
|--------------------------------------------------------------------------------------------- | -------------- | ----------- | ------- | ------------ | - | ------- | ------- | -------- | -------
|Total revenues                                                                                |                | $           | 141,619 |              | $ | 143,408 |         | $        | 141,458
|                                                                                              |                |             |         |              |   |         |         |          |        
|Operating and other expenses                                                                  |                |             | 43,257  |              |   | 41,994  |         |          | 41,217 
|General and administrative                                                                    |                |             | 6,921   |              |   | 5,525   |         |          | 7,903  
|Depreciation and amortization                                                                 |                |             | 28,738  |              |   | 29,300  |         |          | 27,522 
|Interest expense                                                                              |                |             | 29,439  |              |   | 26,429  |         |          | 25,596 
|                                                                                              |                |             |         |              |   |         |         |          |        
|                                                                                              | Total expenses |             |         | 108,355      |   |         | 103,248 |          |        
|                                                                                              |                |             |         |              |   |         |         |          |        
|Equity in earnings of unconsolidated joint ventures                                           |                |             | 4,519   |              |   | 2,205   |         |          | 9,374  
|                                                                                              |                |             |         |              |   |         |         |          |        
|Income before realized gains (losses) and unrealized losses on disposition of rental property |                |             | 37,783  |              |   | 42,365  |         |          | 48,594 
|Realized gains (losses) and unrealized losses on disposition of rental property               |                |             | 45      |              |   | 456     |         |          | (4,840 
|                                                                                              |                |             |         |              |   |         |         |          |        
|Net income                                                                                    |                |             | 37,828  |              |   | 42,821  |         |          | 43,754 
|Preferred unit distributions                                                                  |                |             | (3,925  | )            |   | (3,925  | )       |          | (3,863 
|                                                                                              |                |             |         |              |   |         |         |          |        
|Net income available to common unitholders                                                    |                | $           | 33,903  |              | $ | 38,896  |         | $        | 39,891 
|                                                                                              |                |             |         |              |   |         |         |          |        
|Basic earning per unit:                                                                       |                |             |         |              |   |         |         |          |        
|Net income                                                                                    |                | $           | 0.52    |              | $ | 0.60    |         | $        | 0.61   
|Diluted earnings per unit:                                                                    |                |             |         |              |   |         |         |          |        
|Net income                                                                                    |                | $           | 0.52    |              | $ | 0.59    |         | $        | 0.61   
|Distributions declared per common unit                                                        |                | $           | 0.63    |              | $ | 0.63    |         | $        | 0.62   
|                                                                                              |                |             |         |              |   |         |         |          |        

|Quarter Ended 2001:                                                                           |                | December 31 |         | September 30 |   | June 30 |         | March 31 |        
|--------------------------------------------------------------------------------------------- | -------------- | ----------- | ------- | ------------ | - | ------- | ------- | -------- | -------
|Total revenues                                                                                |                | $           | 141,838 |              | $ | 144,028 |         | $        | 146,381
|Operating and other expenses                                                                  |                |             | 41,804  |              |   | 43,865  |         |          | 43,895 
|General and administrative                                                                    |                |             | 6,857   |              |   | 8,767   |         |          | 6,856  
|Depreciation and amortization                                                                 |                |             | 23,507  |              |   | 22,529  |         |          | 21,951 
|Interest expense                                                                              |                |             | 27,311  |              |   | 27,772  |         |          | 28,555 
|                                                                                              |                |             |         |              |   |         |         |          |        
|                                                                                              | Total expenses |             |         | 99,479       |   |         | 102,933 |          |        
|                                                                                              |                |             |         |              |   |         |         |          |        
|Equity in earnings of unconsolidated joint ventures                                           |                |             | 1,674   |              |   | 1,884   |         |          | 2,037  
|                                                                                              |                |             |         |              |   |         |         |          |        
|Income before realized gains (losses) and unrealized losses on disposition of rental property |                |             | 44,033  |              |   | 42,979  |         |          | 47,161 
|Realized gains (losses) and unrealized losses on disposition of rental property               |                |             | (2,187  | )            |   | (11,624 | )       |          | 22,510 
|                                                                                              |                |             |         |              |   |         |         |          |        
|Net income                                                                                    |                |             | 41,846  |              |   | 31,355  |         |          | 69,671 
|Preferred unit distributions                                                                  |                |             | (3,943  | )            |   | (3,943  | )       |          | (3,879 
|                                                                                              |                |             |         |              |   |         |         |          |        
|Net income available to common unitholders                                                    |                | $           | 37,903  |              | $ | 27,412  |         | $        | 65,792 
|                                                                                              |                |             |         |              |   |         |         |          |        
|Basic earning per unit:                                                                       |                |             |         |              |   |         |         |          |        
|Net income                                                                                    |                | $           | 0.59    |              | $ | 0.43    |         | $        | 1.02   
|Diluted earnings per unit:                                                                    |                |             |         |              |   |         |         |          |        
|Net income                                                                                    |                | $           | 0.58    |              | $ | 0.43    |         | $        | 0.98   
|Distributions declared per common unit                                                        |                | $           | 0.62    |              | $ | 0.62    |         | $        | 0.61   
|                                                                                              |                |             |         |              |   |         |         |          |        

126

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MACK-CALI REALTY CORPORATION
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2002(dollars in thousands)

SCHEDULE III

|                              |  |      |  |      |  |   |        |  |   |        |  |   |        | Gross Amount at Which
Carried at Close of Period(1) |   |       
|----------------------------- |  | ---- |  | ---- |  | - | ------ |  | - | ------ |  | - | ------ | --------------------------------------------------- | - | ------
|
|
|
|
|ATLANTIC COUNTY, NEW JERSEY   |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|Egg Harbor                    |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|100 Decadon Drive (O)         |  | 1987 |  | 1995 |  | $ |       |  | $ | 300    |  | $ | 3,282  |                                                     | $ | 392   
|200 Decadon Drive (O)         |  | 1991 |  | 1995 |  |   |       |  |   | 369    |  |   | 3,241  |                                                     |   | 233   
|BERGEN COUNTY, NEW JERSEY     |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|Fair Lawn                     |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|17-17 Rte 208 North (O)       |  | 1987 |  | 1995 |  |   |       |  |   | 3,067  |  |   | 19,415 |                                                     |   | 2,273 
|Fort Lee                      |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|One Bridge Plaza (O)          |  | 1981 |  | 1996 |  |   |       |  |   | 2,439  |  |   | 24,462 |                                                     |   | 2,087 
|2115 Linwood Avenue (O)       |  | 1981 |  | 1998 |  |   |       |  |   | 474    |  |   | 4,419  |                                                     |   | 4,922 
|Little Ferry                  |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|200 Riser Road (O)            |  | 1974 |  | 1997 |  |   | 10,226 |  |   | 3,888  |  |   | 15,551 |                                                     |   | 246   
|Montvale                      |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|95 Chestnut Ridge Road (O)    |  | 1975 |  | 1997 |  |   | 2,135  |  |   | 1,227  |  |   | 4,907  |                                                     |   | 623   
|135 Chestnut Ridge Road (O)   |  | 1981 |  | 1997 |  |   |       |  |   | 2,587  |  |   | 10,350 |                                                     |   | 2,302 
|Paramus                       |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|15 East Midland Avenue (O)    |  | 1988 |  | 1997 |  |   | 24,790 |  |   | 10,375 |  |   | 41,497 |                                                     |   | 71    
|461 From Road (O)             |  | 1988 |  | 1997 |  |   | 35,000 |  |   | 13,194 |  |   | 52,778 |                                                     |   | 243   
|650 From Road (O)             |  | 1978 |  | 1997 |  |   | 23,316 |  |   | 10,487 |  |   | 41,949 |                                                     |   | 4,060 
|140 Ridgewood Avenue (O)      |  | 1981 |  | 1997 |  |   | 15,392 |  |   | 7,932  |  |   | 31,463 |                                                     |   | 1,249 
|61 South Paramus Avenue (O)   |  | 1985 |  | 1997 |  |   | 15,776 |  |   | 9,005  |  |   | 36,018 |                                                     |   | 4,805 
|Rochelle Park                 |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|120 Passaic Street (O)        |  | 1972 |  | 1997 |  |   |       |  |   | 1,354  |  |   | 5,415  |                                                     |   | 102   
|365 West Passaic Street (O)   |  | 1976 |  | 1997 |  |   | 7,468  |  |   | 4,148  |  |   | 16,592 |                                                     |   | 1,916 
|Upper Saddle River            |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|1 Lake Street (O)             |  | 1994 |  | 1997 |  |   | 35,789 |  |   | 13,952 |  |   | 55,812 |                                                     |   | 7     
|10 Mountainview Road (O)      |  | 1986 |  | 1998 |  |   |       |  |   | 4,240  |  |   | 20,485 |                                                     |   | 377   
|Woodcliff Lake                |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|400 Chestnut Ridge Road (O)   |  | 1982 |  | 1997 |  |   | 11,611 |  |   | 4,201  |  |   | 16,802 |                                                     |   | 23    
|470 Chestnut Ridge Road (O)   |  | 1987 |  | 1997 |  |   | 4,087  |  |   | 2,346  |  |   | 9,385  |                                                     |   | 2     
|530 Chestnut Ridge Road (O)   |  | 1986 |  | 1997 |  |   | 4,032  |  |   | 1,860  |  |   | 7,441  |                                                     |   | 3     
|300 Tice Boulevard (O)        |  | 1991 |  | 1996 |  |   |       |  |   | 5,424  |  |   | 29,688 |                                                     |   | 2,000 
|50 Tice Boulevard (O)         |  | 1984 |  | 1994 |  |   |       |  |   | 4,500  |  |   |       |                                                     |   | 26,884
|BURLINGTON COUNTY, NEW JERSEY |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|Burlington                    |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|3 Terri Lane (F)              |  | 1991 |  | 1998 |  |   |       |  |   | 652    |  |   | 3,433  |                                                     |   | 962   
|5 Terri Lane (F)              |  | 1992 |  | 1998 |  |   |       |  |   | 564    |  |   | 3,792  |                                                     |   | 1,716 
|Moorestown                    |  |      |  |      |  |   |        |  |   |        |  |   |        |                                                     |   |       
|2 Commerce Drive (F)          |  | 1986 |  | 1999 |  |   |       |  |   | 723    |  |   | 2,893  |                                                     |   | 59    
|101 Commerce Drive (F)        |  | 1988 |  | 1998 |  |   |       |  |   | 422    |  |   | 3,528  |                                                     |   | 253   
|102 Commerce Drive (F)        |  | 1987 |  | 1999 |  |   |       |  |   | 389    |  |   | 1,554  |                                                     |   | 45    
|201 Commerce Drive (F)        |  | 1986 |  | 1998 |  |   |       |  |   | 254    |  |   | 1,694  |                                                     |   | 91    
|202 Commerce Drive (F)        |  | 1988 |  | 1999 |  |   |       |  |   | 490    |  |   | 1,963  |                                                     |   | 52    
|1 Executive Drive (F)         |  | 1989 |  | 1998 |  |   |       |  |   | 226    |  |   | 1,453  |                                                     |   | 209   
|2 Executive Drive (F)         |  | 1988 |  | 2000 |  |   |       |  |   | 801    |  |   | 3,206  |                                                     |   | 233   
|101 Executive Drive (F)       |  | 1990 |  | 1998 |  |   |       |  |   | 241    |  |   | 2,262  |                                                     |   | 300   
|102 Executive Drive (F)       |  | 1990 |  | 1998 |  |   |       |  |   | 353    |  |   | 3,607  |                                                     |   | 254   
|225 Executive Drive (F)       |  | 1990 |  | 1998 |  |   |       |  |   | 323    |  |   | 2,477  |                                                     |   | 110   
|97 Foster Road (F)            |  | 1982 |  | 1998 |  |   |       |  |   | 208    |  |   | 1,382  |                                                     |   | 81    
|1507 Lancer Drive (F)         |  | 1995 |  | 1998 |  |   |       |  |   | 119    |  |   | 1,106  |                                                     |   | 44    

127

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MACK-CALI REALTY CORPORATION
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2002(dollars in thousands)

SCHEDULE III

|                                         |  |      |  |      |  |        |  |        |  |         |  |        |   | Gross Amount at Which
Carried at Close of Period(1) |  |        
|---------------------------------------- |  | ---- |  | ---- |  | ------ |  | ------ |  | ------- |  | ------ | - | --------------------------------------------------- |  | -------
|
|
|
|
|1510 Lancer Drive (F)                    |  | 1998 |  | 1998 |  |       |  | 732    |  | 2,928   |  | 41     |   | 735                                                 |  | 2,966  
|840 North Lenola Road (F)                |  | 1995 |  | 1998 |  |       |  | 329    |  | 2,366   |  | 200    |   | 333                                                 |  | 2,562  
|844 North Lenola Road (F)                |  | 1995 |  | 1998 |  |       |  | 239    |  | 1,714   |  | 38     |   | 241                                                 |  | 1,750  
|915 North Lenola Road (F)                |  | 1998 |  | 2000 |  |       |  | 508    |  | 2,034   |  | 163    |   | 508                                                 |  | 2,197  
|1245 North Church Street (F)             |  | 1998 |  | 2001 |  |       |  | 691    |  | 2,810   |  | 17     |   | 691                                                 |  | 2,827  
|1247 North Church Street (F)             |  | 1998 |  | 2001 |  |       |  | 805    |  | 3,269   |  | 17     |   | 805                                                 |  | 3,286  
|1256 North Church Street (F)             |  | 1984 |  | 1998 |  |       |  | 354    |  | 3,098   |  | 366    |   | 357                                                 |  | 3,461  
|224 Strawbridge Drive (O)                |  | 1984 |  | 1997 |  |       |  | 766    |  | 4,335   |  | 3,165  |   | 766                                                 |  | 7,500  
|228 Strawbridge Drive (O)                |  | 1984 |  | 1997 |  |       |  | 766    |  | 4,334   |  | 2,901  |   | 766                                                 |  | 7,235  
|2 Twosome Drive (F)                      |  | 2000 |  | 2001 |  |       |  | 701    |  | 2,807   |  | 18     |   | 701                                                 |  | 2,825  
|30 Twosome Drive (F)                     |  | 1997 |  | 1998 |  |       |  | 234    |  | 1,954   |  | 49     |   | 236                                                 |  | 2,001  
|31 Twosome Drive (F)                     |  | 1998 |  | 2001 |  |       |  | 815    |  | 3,276   |  | 102    |   | 815                                                 |  | 3,378  
|40 Twosome Drive (F)                     |  | 1996 |  | 1998 |  |       |  | 297    |  | 2,393   |  | 76     |   | 301                                                 |  | 2,465  
|41 Twosome Drive (F)                     |  | 1998 |  | 2001 |  |       |  | 605    |  | 2,459   |  | 12     |   | 605                                                 |  | 2,471  
|50 Twosome Drive (F)                     |  | 1997 |  | 1998 |  |       |  | 301    |  | 2,330   |  | 88     |   | 304                                                 |  | 2,415  
|West Deptford                            |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|1451 Metropolitan Drive (F)              |  | 1996 |  | 1998 |  |       |  | 203    |  | 1,189   |  | 30     |   | 206                                                 |  | 1,216  
|ESSEX COUNTY, NEW JERSEY                 |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|Millburn                                 |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|150 J.F. Kennedy Parkway (O)             |  | 1980 |  | 1997 |  | 24,470 |  | 12,606 |  | 50,425  |  | 4,656  |   | 12,606                                              |  | 55,081 
|Roseland                                 |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|101 Eisenhower Parkway (O)               |  | 1980 |  | 1994 |  |       |  | 228    |  |        |  | 14,603 |   | 228                                                 |  | 14,603 
|103 Eisenhower Parkway (O)               |  | 1985 |  | 1994 |  |       |  |       |  |        |  | 13,555 |   | 2,300                                               |  | 11,255 
|105 Eisenhower Parkway (O)               |  | 2001 |  | 2001 |  |       |  | 4,430  |  | 42,898  |  | (64    | ) | 3,835                                               |  | 43,429 
|HUDSON COUNTY, NEW JERSEY                |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|Jersey City                              |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|Harborside Financial Center Plaza 1 (O)  |  | 1983 |  | 1996 |  | 61,722 |  | 3,923  |  | 51,013  |  |       |   | 3,923                                               |  | 51,013 
|Harborside Financial Center Plaza 2 (O)  |  | 1990 |  | 1996 |  | 79,070 |  | 17,655 |  | 101,546 |  | 4,390  |   | 15,585                                              |  | 108,006
|Harborside Financial Center Plaza 3 (O)  |  | 1990 |  | 1996 |  | 79,070 |  | 17,655 |  | 101,878 |  | 4,058  |   | 15,585                                              |  | 108,006
|Harborside Financial Center Plaza 4A (O) |  | 2000 |  | 2000 |  |       |  | 1,244  |  | 56,144  |  | 7,054  |   | 1,244                                               |  | 63,198 
|Harborside Financial Center Plaza 5 (O)  |  | 2002 |  | 2002 |  |       |  | 6,218  |  | 170,682 |  |       |   | 6,218                                               |  | 170,682
|MERCER COUNTY, NEW JERSEY                |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|Hamilton Township                        |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|100 Horizon Drive (F)                    |  | 1989 |  | 1995 |  |       |  | 205    |  | 1,676   |  | 24     |   | 172                                                 |  | 1,733  
|200 Horizon Drive (F)                    |  | 1991 |  | 1995 |  |       |  | 205    |  | 3,027   |  | 213    |   | 205                                                 |  | 3,240  
|300 Horizon Drive (F)                    |  | 1989 |  | 1995 |  |       |  | 379    |  | 4,355   |  | 912    |   | 379                                                 |  | 5,267  
|500 Horizon Drive (F)                    |  | 1990 |  | 1995 |  |       |  | 379    |  | 3,395   |  | 729    |   | 344                                                 |  | 4,159  
|600 Horizon Drive (O)                    |  | 2002 |  | 2002 |  |       |  |       |  | 7,549   |  | (15    | ) |                                                    |  | 7,534  
|Zero Horizon Drive (L)                   |  | n/a  |  | 1999 |  |       |  | 498    |  |        |  | 1,799  |   | 498                                                 |  | 1,799  
|Princeton                                |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|103 Carnegie Center (O)                  |  | 1984 |  | 1996 |  |       |  | 2,566  |  | 7,868   |  | 709    |   | 2,566                                               |  | 8,577  
|100 Overlook Center (O)                  |  | 1988 |  | 1997 |  |       |  | 2,378  |  | 21,754  |  | 1,606  |   | 2,378                                               |  | 23,360 
|5 Vaughn Drive (O)                       |  | 1987 |  | 1995 |  |       |  | 657    |  | 9,800   |  | 524    |   | 657                                                 |  | 10,324 
|MIDDLESEX COUNTY, NEW JERSEY             |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|East Brunswick                           |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|377 Summerhill Road (O)                  |  | 1977 |  | 1997 |  |       |  | 649    |  | 2,594   |  | 252    |   | 649                                                 |  | 2,846  
|Plainsboro                               |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|500 College Road East (O)                |  | 1984 |  | 1998 |  |       |  | 614    |  | 20,626  |  | 399    |   | 614                                                 |  | 21,025 
|South Brunswick                          |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|3 Independence Way (O)                   |  | 1983 |  | 1997 |  |       |  | 1,997  |  | 11,391  |  | 372    |   | 1,997                                               |  | 11,763 
|Woodbridge                               |  |      |  |      |  |        |  |        |  |         |  |        |   |                                                     |  |        
|581 Main Street (O)                      |  | 1991 |  | 1997 |  | 17,500 |  | 3,237  |  | 12,949  |  | 19,808 |   | 8,115                                               |  | 27,879 

128

---

MACK-CALI REALTY CORPORATION
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2002(dollars in thousands)

SCHEDULE III

|                              |  |      |  |      |  |        |  |        |  |        |  |        |  | Gross Amount at Which
Carried at Close of Period(1) |  |       
|----------------------------- |  | ---- |  | ---- |  | ------ |  | ------ |  | ------ |  | ------ |  | --------------------------------------------------- |  | ------
|
|
|
|
|MONMOUTH COUNTY, NEW JERSEY   |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|Neptune                       |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|3600 Route 66 (O)             |  | 1989 |  | 1995 |  |       |  | 1,098  |  | 18,146 |  | 53     |  | 1,098                                               |  | 18,199
|Wall Township                 |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|1305 Campus Parkway (O)       |  | 1988 |  | 1995 |  |       |  | 335    |  | 2,560  |  | 123    |  | 335                                                 |  | 2,683 
|1325 Campus Parkway (F)       |  | 1988 |  | 1995 |  |       |  | 270    |  | 2,928  |  | 567    |  | 270                                                 |  | 3,495 
|1340 Campus Parkway (F)       |  | 1992 |  | 1995 |  |       |  | 489    |  | 4,621  |  | 462    |  | 489                                                 |  | 5,083 
|1345 Campus Parkway (F)       |  | 1995 |  | 1997 |  |       |  | 1,023  |  | 5,703  |  | 638    |  | 1,024                                               |  | 6,340 
|1350 Campus Parkway (O)       |  | 1990 |  | 1995 |  |       |  | 454    |  | 7,134  |  | 1,153  |  | 454                                                 |  | 8,287 
|1433 Highway 34 (F)           |  | 1985 |  | 1995 |  |       |  | 889    |  | 4,321  |  | 986    |  | 889                                                 |  | 5,307 
|1320 Wyckoff Avenue (F)       |  | 1986 |  | 1995 |  |       |  | 255    |  | 1,285  |  | 6      |  | 255                                                 |  | 1,291 
|1324 Wyckoff Avenue (F)       |  | 1987 |  | 1995 |  |       |  | 230    |  | 1,439  |  | 126    |  | 230                                                 |  | 1,565 
|MORRIS COUNTY, NEW JERSEY     |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|Florham Park                  |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|325 Columbia Parkway (O)      |  | 1987 |  | 1994 |  |       |  | 1,564  |  |       |  | 15,172 |  | 1,564                                               |  | 15,172
|Morris Plains                 |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|250 Johnson Road (O)          |  | 1977 |  | 1997 |  |       |  | 2,004  |  | 8,016  |  | 574    |  | 2,004                                               |  | 8,590 
|201 Littleton Road (O)        |  | 1979 |  | 1997 |  |       |  | 2,407  |  | 9,627  |  | 276    |  | 2,407                                               |  | 9,903 
|Morris Township               |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|340 Mt. Kemble Avenue (O)     |  | 1985 |  | 1997 |  | 32,178 |  | 13,624 |  | 54,496 |  | 40     |  | 13,624                                              |  | 54,536
|Parsippany                    |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|4 Campus Drive (O)            |  | 1983 |  | 2001 |  |       |  | 5,213  |  | 20,984 |  | 330    |  | 5,213                                               |  | 21,314
|6 Campus Drive (O)            |  | 1983 |  | 2001 |  |       |  | 4,411  |  | 17,796 |  | 264    |  | 4,411                                               |  | 18,060
|7 Campus Drive (O)            |  | 1982 |  | 1998 |  |       |  | 1,932  |  | 27,788 |  | 107    |  | 1,932                                               |  | 27,895
|8 Campus Drive (O)            |  | 1987 |  | 1998 |  |       |  | 1,865  |  | 35,456 |  | 1,510  |  | 1,865                                               |  | 36,966
|9 Campus Drive (O)            |  | 1983 |  | 2001 |  |       |  | 3,277  |  | 11,796 |  | 15,727 |  | 5,842                                               |  | 24,958
|2 Dryden Way (O)              |  | 1990 |  | 1998 |  |       |  | 778    |  | 420    |  | 13     |  | 778                                                 |  | 433   
|4 Gatehall Drive (O)          |  | 1988 |  | 2000 |  |       |  | 8,452  |  | 33,929 |  | 465    |  | 8,452                                               |  | 34,394
|2 Hilton Court (O)            |  | 1991 |  | 1998 |  |       |  | 1,971  |  | 32,007 |  | 1,546  |  | 1,971                                               |  | 33,553
|1633 Littleton Road (O)       |  | 1978 |  | 2002 |  | 3,504  |  | 2,283  |  | 9,550  |  |       |  | 2,283                                               |  | 9,550 
|600 Parsippany Road (O)       |  | 1978 |  | 1994 |  |       |  | 1,257  |  | 5,594  |  | 1,233  |  | 1,257                                               |  | 6,827 
|1 Sylvan Way (O)              |  | 1989 |  | 1998 |  |       |  | 1,689  |  | 24,699 |  | 394    |  | 1,021                                               |  | 25,761
|5 Sylvan Way (O)              |  | 1989 |  | 1998 |  |       |  | 1,160  |  | 25,214 |  | 714    |  | 1,160                                               |  | 25,928
|7 Sylvan Way (O)              |  | 1987 |  | 1998 |  |       |  | 2,084  |  | 26,083 |  | 667    |  | 2,084                                               |  | 26,750
|PASSAIC COUNTY, NEW JERSEY    |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|Clifton                       |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|777 Passaic Avenue (O)        |  | 1983 |  | 1994 |  |       |  |       |  |       |  | 7,198  |  | 1,100                                               |  | 6,098 
|Totowa                        |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|1 Center Court (F)            |  | 1999 |  | 1999 |  |       |  | 270    |  | 1,824  |  | 713    |  | 270                                                 |  | 2,537 
|2 Center Court (F)            |  | 1998 |  | 1998 |  |       |  | 191    |  |       |  | 2,592  |  | 191                                                 |  | 2,592 
|11 Commerce Way (F)  '        |  | 1989 |  | 1995 |  |       |  | 586    |  | 2,986  |  | 267    |  | 586                                                 |  | 3,253 
|20 Commerce Way (F)           |  | 1992 |  | 1995 |  |       |  | 516    |  | 3,108  |  | 67     |  | 516                                                 |  | 3,175 
|29 Commerce Way (F)           |  | 1990 |  | 1995 |  |       |  | 586    |  | 3,092  |  | 725    |  | 586                                                 |  | 3,817 
|40 Commerce Way (F)           |  | 1987 |  | 1995 |  |       |  | 516    |  | 3,260  |  | 438    |  | 516                                                 |  | 3,698 
|45 Commerce Way (F)           |  | 1992 |  | 1995 |  |       |  | 536    |  | 3,379  |  | 197    |  | 536                                                 |  | 3,576 
|60 Commerce Way (F)           |  | 1988 |  | 1995 |  |       |  | 526    |  | 3,257  |  | 274    |  | 526                                                 |  | 3,531 
|80 Commerce Way (F)           |  | 1996 |  | 1996 |  |       |  | 227    |  |       |  | 1,678  |  | 227                                                 |  | 1,678 
|100 Commerce Way (F)          |  | 1996 |  | 1996 |  |       |  | 226    |  |       |  | 1,677  |  | 226                                                 |  | 1,677 
|120 Commerce Way (F)          |  | 1994 |  | 1995 |  |       |  | 228    |  |       |  | 1,212  |  | 228                                                 |  | 1,212 
|140 Commerce Way (F)          |  | 1994 |  | 1995 |  |       |  | 229    |  |       |  | 1,211  |  | 229                                                 |  | 1,211 
|999 Riverview Drive (O)       |  | 1988 |  | 1995 |  |       |  | 476    |  | 6,024  |  | 462    |  | 476                                                 |  | 6,486 
|Wayne                         |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|201 Willowbrook Boulevard (O) |  | 1970 |  | 1997 |  | 7,658  |  | 3,103  |  | 12,410 |  | 4,567  |  | 3,103                                               |  | 16,977

129

---

MACK-CALI REALTY CORPORATION
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2002(dollars in thousands)

SCHEDULE III

|                             |  |      |  |      |  |        |  |        |  |        |  |        |   | Gross Amount at Which
Carried at Close of Period(1) |  |       
|---------------------------- |  | ---- |  | ---- |  | ------ |  | ------ |  | ------ |  | ------ | - | --------------------------------------------------- |  | ------
|
|
|
|
|SOMERSET COUNTY, NEW JERSEY  |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|Basking Ridge                |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|106 Allen Road (O)           |  | 2000 |  | 2000 |  |       |  | 3,853  |  | 14,465 |  | 2,327  |   | 3,457                                               |  | 17,188
|222 Mt. Airy Road (O)        |  | 1986 |  | 1996 |  | 3,386  |  | 775    |  | 3,636  |  | 17     |   | 775                                                 |  | 3,653 
|233 Mt. Airy Road (O)        |  | 1987 |  | 1996 |  |       |  | 1,034  |  | 5,033  |  | 1,646  |   | 1,034                                               |  | 6,679 
|Bridgewater                  |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|721 Route 202/206 (O)        |  | 1989 |  | 1997 |  | 23,000 |  | 6,730  |  | 26,919 |  | 563    |   | 6,730                                               |  | 27,482
|UNION COUNTY, NEW JERSEY     |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|Clark                        |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|100 Walnut Avenue (O)        |  | 1985 |  | 1994 |  |       |  |       |  |       |  | 18,600 |   | 1,822                                               |  | 16,778
|Cranford                     |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|6 Commerce Drive (O)         |  | 1973 |  | 1994 |  |       |  | 250    |  |       |  | 2,742  |   | 250                                                 |  | 2,742 
|11 Commerce Drive (O)        |  | 1981 |  | 1994 |  |       |  | 470    |  |       |  | 5,906  |   | 470                                                 |  | 5,906 
|12 Commerce Drive (O)        |  | 1967 |  | 1997 |  |       |  | 887    |  | 3,549  |  | 1,303  |   | 887                                                 |  | 4,852 
|20 Commerce Drive (O)        |  | 1990 |  | 1994 |  |       |  | 2,346  |  |       |  | 22,250 |   | 2,346                                               |  | 22,250
|25 Commerce Drive (O)        |  | 1971 |  | 2002 |  |       |  | 1,520  |  | 6,186  |  |       |   | 1,520                                               |  | 6,186 
|65 Jackson Drive (O)         |  | 1984 |  | 1994 |  |       |  | 541    |  |       |  | 7,090  |   | 542                                                 |  | 7,089 
|New Providence               |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|890 Mountain Road (O)        |  | 1977 |  | 1997 |  |       |  | 2,796  |  | 11,185 |  | 4,397  |   | 3,765                                               |  | 14,613
|DUTCHESS COUNTY, NEW YORK    |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|Fishkill                     |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|300 South Lake Drive (O)     |  | 1987 |  | 1997 |  |       |  | 2,258  |  | 9,031  |  | 624    |   | 2,258                                               |  | 9,655 
|NASSAU COUNTY, NEW YORK      |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|North Hempstead              |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|600 Community Drive (O)      |  | 1983 |  | 1997 |  |       |  | 11,018 |  | 44,070 |  | 540    |   | 11,018                                              |  | 44,610
|111 East Shore Road (O)      |  | 1980 |  | 1997 |  |       |  | 2,093  |  | 8,370  |  | 365    |   | 2,093                                               |  | 8,735 
|ROCKLAND COUNTY, NEW YORK    |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|Suffern                      |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|400 Rella Boulevard (O)      |  | 1988 |  | 1995 |  |       |  | 1,090  |  | 13,412 |  | 2,687  |   | 1,090                                               |  | 16,099
|WESTCHESTER COUNTY, NEW YORK |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|Elmsford                     |  |      |  |      |  |        |  |        |  |        |  |        |   |                                                     |  |       
|11 Clearbrook Road (F)       |  | 1974 |  | 1997 |  |       |  | 149    |  | 2,159  |  | 153    |   | 149                                                 |  | 2,312 
|75 Clearbrook Road (F)       |  | 1990 |  | 1997 |  |       |  | 2,314  |  | 4,716  |  | 5      |   | 2,314                                               |  | 4,721 
|100 Clearbrook Road (O)      |  | 1975 |  | 1997 |  |       |  | 220    |  | 5,366  |  | 312    |   | 220                                                 |  | 5,678 
|125 Clearbrook Road (F)      |  | 2002 |  | 2002 |  |       |  | 1,055  |  | 3,676  |  | (63    | ) | 1,055                                               |  | 3,613 
|150 Clearbrook Road (F)      |  | 1975 |  | 1997 |  |       |  | 497    |  | 7,030  |  | 520    |   | 497                                                 |  | 7,550 
|175 Clearbrook Road (F)      |  | 1973 |  | 1997 |  |       |  | 655    |  | 7,473  |  | 676    |   | 655                                                 |  | 8,149 
|200 Clearbrook Road (F)      |  | 1974 |  | 1997 |  |       |  | 579    |  | 6,620  |  | 581    |   | 579                                                 |  | 7,201 
|250 Clearbrook Road (F)      |  | 1973 |  | 1997 |  |       |  | 867    |  | 8,647  |  | 751    |   | 867                                                 |  | 9,398 
|50 Executive Boulevard (F)   |  | 1969 |  | 1997 |  |       |  | 237    |  | 2,617  |  | 78     |   | 237                                                 |  | 2,695 
|77 Executive Boulevard (F)   |  | 1977 |  | 1997 |  |       |  | 34     |  | 1,104  |  | 79     |   | 34                                                  |  | 1,183 
|85 Executive Boulevard (F)   |  | 1968 |  | 1997 |  |       |  | 155    |  | 2,507  |  | 38     |   | 155                                                 |  | 2,545 
|101 Executive Boulevard (O)  |  | 1971 |  | 1997 |  |       |  | 267    |  | 5,838  |  | 620    |   | 267                                                 |  | 6,458 
|300 Executive Boulevard (F)  |  | 1970 |  | 1997 |  |       |  | 460    |  | 3,609  |  | 140    |   | 460                                                 |  | 3,749 
|350 Executive Boulevard (F)  |  | 1970 |  | 1997 |  |       |  | 100    |  | 1,793  |  | 140    |   | 100                                                 |  | 1,933 
|399 Executive Boulevard (F)  |  | 1962 |  | 1997 |  |       |  | 531    |  | 7,191  |  | 133    |   | 531                                                 |  | 7,324 
|400 Executive Boulevard (F)  |  | 1970 |  | 1997 |  |       |  | 2,202  |  | 1,846  |  | 270    |   | 2,201                                               |  | 2,117 
|500 Executive Boulevard (F)  |  | 1970 |  | 1997 |  |       |  | 258    |  | 4,183  |  | 576    |   | 257                                                 |  | 4,760 
|525 Executive Boulevard (F)  |  | 1972 |  | 1997 |  |       |  | 345    |  | 5,499  |  | 351    |   | 345                                                 |  | 5,850 
|700 Executive Boulevard (L)  |  | n/a  |  | 1997 |  |       |  | 970    |  |       |  |       |   | 970                                                 |  |      

130

---

MACK-CALI REALTY CORPORATION
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2002(dollars in thousands)

SCHEDULE III

|                                  |  |      |  |      |  |   |  |       |  |        |  |       |  | Gross Amount at Which
Carried at Close of
Period(1) |  |       
|--------------------------------- |  | ---- |  | ---- |  | - |  | ----- |  | ------ |  | ----- |  | --------------------------------------------------- |  | ------
|
|
|
|
|5 Skyline Drive (F)               |  | 1980 |  | 2001 |  |  |  | 2,219 |  | 8,916  |  | 9     |  | 2,219                                               |  | 8,925 
|6 Skyline Drive (F)               |  | 1980 |  | 2001 |  |  |  | 740   |  | 2,971  |  | 6     |  | 740                                                 |  | 2,977 
|555 Taxter Road (O)               |  | 1986 |  | 2000 |  |  |  | 4,285 |  | 17,205 |  | 499   |  | 4,285                                               |  | 17,704
|565 Taxter Road (O)               |  | 1988 |  | 2000 |  |  |  | 4,285 |  | 17,205 |  | 728   |  | 4,233                                               |  | 17,985
|570 Taxter Road (O)               |  | 1972 |  | 1997 |  |  |  | 438   |  | 6,078  |  | 769   |  | 438                                                 |  | 6,847 
|1 Warehouse Lane (I)              |  | 1957 |  | 1997 |  |  |  | 3     |  | 268    |  | 205   |  | 3                                                   |  | 473   
|2 Warehouse Lane (I)              |  | 1957 |  | 1997 |  |  |  | 4     |  | 672    |  | 202   |  | 4                                                   |  | 874   
|3 Warehouse Lane (I)              |  | 1957 |  | 1997 |  |  |  | 21    |  | 1,948  |  | 468   |  | 21                                                  |  | 2,416 
|4 Warehouse Lane (I)              |  | 1957 |  | 1997 |  |  |  | 84    |  | 13,393 |  | 382   |  | 85                                                  |  | 13,774
|5 Warehouse Lane (I)              |  | 1957 |  | 1997 |  |  |  | 19    |  | 4,804  |  | 299   |  | 19                                                  |  | 5,103 
|6 Warehouse Lane (I)              |  | 1982 |  | 1997 |  |  |  | 10    |  | 4,419  |  | 238   |  | 10                                                  |  | 4,657 
|1 Westchester Plaza (F)           |  | 1967 |  | 1997 |  |  |  | 199   |  | 2,023  |  | 52    |  | 199                                                 |  | 2,075 
|2 Westchester Plaza (F)           |  | 1968 |  | 1997 |  |  |  | 234   |  | 2,726  |  | 77    |  | 234                                                 |  | 2,803 
|3 Westchester Plaza (F)           |  | 1969 |  | 1997 |  |  |  | 655   |  | 7,936  |  | 196   |  | 655                                                 |  | 8,132 
|4 Westchester Plaza (F)           |  | 1969 |  | 1997 |  |  |  | 320   |  | 3,729  |  | 112   |  | 320                                                 |  | 3,841 
|5 Westchester Plaza (F)           |  | 1969 |  | 1997 |  |  |  | 118   |  | 1,949  |  | 175   |  | 118                                                 |  | 2,124 
|6 Westchester Plaza (F)           |  | 1968 |  | 1997 |  |  |  | 164   |  | 1,998  |  | 144   |  | 164                                                 |  | 2,142 
|7 Westchester Plaza (F)           |  | 1972 |  | 1997 |  |  |  | 286   |  | 4,321  |  | 83    |  | 286                                                 |  | 4,404 
|8 Westchester Plaza (F)           |  | 1971 |  | 1997 |  |  |  | 447   |  | 5,262  |  | 726   |  | 447                                                 |  | 5,988 
|Hawthorne                         |  |      |  |      |  |   |  |       |  |        |  |       |  |                                                     |  |       
|200 Saw Mill River Road (F)       |  | 1965 |  | 1997 |  |  |  | 353   |  | 3,353  |  | 251   |  | 353                                                 |  | 3,604 
|1 Skyline Drive (O)               |  | 1980 |  | 1997 |  |  |  | 66    |  | 1,711  |  | 205   |  | 66                                                  |  | 1,916 
|2 Skyline Drive (O)               |  | 1987 |  | 1997 |  |  |  | 109   |  | 3,128  |  | 325   |  | 109                                                 |  | 3,453 
|3 Skyline Drive (O)               |  | 1981 |  | 2002 |  |  |  | 1,882 |  | 7,578  |  | 63    |  | 1,882                                               |  | 7,641 
|4 Skyline Drive (F)               |  | 1987 |  | 1997 |  |  |  | 363   |  | 7,513  |  | 726   |  | 363                                                 |  | 8,239 
|7 Skyline Drive (O)               |  | 1987 |  | 1998 |  |  |  | 330   |  | 13,013 |  | 537   |  | 330                                                 |  | 13,550
|8 Skyline Drive (F)               |  | 1985 |  | 1997 |  |  |  | 212   |  | 4,410  |  | 1,405 |  | 212                                                 |  | 5,815 
|10 Skyline Drive (F)              |  | 1985 |  | 1997 |  |  |  | 134   |  | 2,799  |  | 105   |  | 134                                                 |  | 2,904 
|11 Skyline Drive (F)              |  | 1989 |  | 1997 |  |  |  |      |  | 4,788  |  | 444   |  |                                                    |  | 5,232 
|12 Skyline Drive (F)              |  | 1999 |  | 1999 |  |  |  | 1,562 |  | 3,254  |  | 1,499 |  | 1,320                                               |  | 4,995 
|14 Skyline Drive (L)              |  | n/a  |  | 2002 |  |  |  | 964   |  |       |  |      |  | 964                                                 |  |      
|15 Skyline Drive (F)              |  | 1989 |  | 1997 |  |  |  |      |  | 7,449  |  | 782   |  |                                                    |  | 8,231 
|16 Skyline Drive (L)              |  | n/a  |  | 2002 |  |  |  | 850   |  |       |  |      |  | 850                                                 |  |      
|17 Skyline Drive (O)              |  | 1989 |  | 1997 |  |  |  |      |  | 7,269  |  | 130   |  |                                                    |  | 7,399 
|19 Skyline Drive (O)              |  | 1982 |  | 1997 |  |  |  | 2,355 |  | 34,254 |  | 4,332 |  | 2,356                                               |  | 38,585
|Tarrytown                         |  |      |  |      |  |   |  |       |  |        |  |       |  |                                                     |  |       
|200 White Plains Road (O)         |  | 1982 |  | 1997 |  |  |  | 378   |  | 8,367  |  | 876   |  | 378                                                 |  | 9,243 
|220 White Plains Road (O)         |  | 1984 |  | 1997 |  |  |  | 367   |  | 8,112  |  | 786   |  | 367                                                 |  | 8,898 
|230 White Plains Road (R)         |  | 1984 |  | 1997 |  |  |  | 124   |  | 1,845  |  |      |  | 124                                                 |  | 1,845 
|White Plains                      |  |      |  |      |  |   |  |       |  |        |  |       |  |                                                     |  |       
|1 Barker Avenue (O)               |  | 1975 |  | 1997 |  |  |  | 208   |  | 9,629  |  | 653   |  | 207                                                 |  | 10,283
|3 Barker Avenue (O)               |  | 1983 |  | 1997 |  |  |  | 122   |  | 7,864  |  | 1,630 |  | 122                                                 |  | 9,494 
|50 Main Street (O)                |  | 1985 |  | 1997 |  |  |  | 564   |  | 48,105 |  | 4,511 |  | 564                                                 |  | 52,616
|11 Martine Avenue (O)             |  | 1987 |  | 1997 |  |  |  | 127   |  | 26,833 |  | 3,983 |  | 127                                                 |  | 30,816
|1 Water Street (O)                |  | 1979 |  | 1997 |  |  |  | 211   |  | 5,382  |  | 563   |  | 211                                                 |  | 5,945 
|Yonkers                           |  |      |  |      |  |   |  |       |  |        |  |       |  |                                                     |  |       
|100 Corporate Boulevard (F)       |  | 1987 |  | 1997 |  |  |  | 602   |  | 9,910  |  | 711   |  | 602                                                 |  | 10,621
|200 Corporate Boulevard South (F) |  | 1990 |  | 1997 |  |  |  | 502   |  | 7,575  |  | 243   |  | 502                                                 |  | 7,818 
|250 Corporate Boulevard South (L) |  | n/a  |  | 2002 |  |  |  | 1,028 |  |       |  |      |  | 1,028                                               |  |      
|1 Enterprise Boulevard (L)        |  | n/a  |  | 1997 |  |  |  | 1,379 |  |       |  |      |  | 1,379                                               |  |      
|1 Executive Boulevard (O)         |  | 1982 |  | 1997 |  |  |  | 1,104 |  | 11,904 |  | 971   |  | 1,105                                               |  | 12,874
|2 Executive Plaza (R)             |  | 1986 |  | 1997 |  |  |  | 89    |  | 2,439  |  |      |  | 89                                                  |  | 2,439 
|3 Executive Plaza (O)             |  | 1987 |  | 1997 |  |  |  | 385   |  | 6,256  |  | 1,031 |  | 385                                                 |  | 7,287 
|4 Executive Plaza (F)             |  | 1986 |  | 1997 |  |  |  | 584   |  | 6,134  |  | 1,049 |  | 584                                                 |  | 7,183 

131

---

MACK-CALI REALTY CORPORATION
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2002(dollars in thousands)

SCHEDULE III

|                                 |  |      |  |      |  |        |  |        |  |        |  |        |  | Gross Amount at Which
Carried at Close of Period(1) |  |       
|-------------------------------- |  | ---- |  | ---- |  | ------ |  | ------ |  | ------ |  | ------ |  | --------------------------------------------------- |  | ------
|
|
|
|
|6 Executive Plaza (F)            |  | 1987 |  | 1997 |  |       |  | 546    |  | 7,246  |  | 81     |  | 546                                                 |  | 7,327 
|1 Odell Plaza (F)                |  | 1980 |  | 1997 |  |       |  | 1,206  |  | 6,815  |  | 609    |  | 1,206                                               |  | 7,424 
|5 Odell Plaza (F)                |  | 1983 |  | 1997 |  |       |  | 331    |  | 2,988  |  | 158    |  | 331                                                 |  | 3,146 
|7 Odell Plaza (F)                |  | 1984 |  | 1997 |  |       |  | 419    |  | 4,418  |  | 219    |  | 419                                                 |  | 4,637 
|CHESTER COUNTY, PENNSYLVANIA     |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|Berwyn                           |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|1000 Westlakes Drive (O)         |  | 1989 |  | 1997 |  |       |  | 619    |  | 9,016  |  | 457    |  | 618                                                 |  | 9,474 
|1055 Westlakes Drive (O)         |  | 1990 |  | 1997 |  |       |  | 1,951  |  | 19,046 |  | 2,194  |  | 1,951                                               |  | 21,240
|1205 Westlakes Drive (O)         |  | 1988 |  | 1997 |  |       |  | 1,323  |  | 20,098 |  | 841    |  | 1,323                                               |  | 20,939
|1235 Westlakes Drive (O)         |  | 1986 |  | 1997 |  |       |  | 1,417  |  | 21,215 |  | 996    |  | 1,418                                               |  | 22,210
|DELAWARE COUNTY, PENNSYLVANIA    |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                    
|Lester                           |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|100 Stevens Drive (O)            |  | 1986 |  | 1996 |  |       |  | 1,349  |  | 10,018 |  | 2,791  |  | 1,349                                               |  | 12,809
|200 Stevens Drive (O)            |  | 1987 |  | 1996 |  |       |  | 1,644  |  | 20,186 |  | 4,536  |  | 1,644                                               |  | 24,722
|300 Stevens Drive (O)            |  | 1992 |  | 1996 |  |       |  | 491    |  | 9,490  |  | 735    |  | 491                                                 |  | 10,225
|Media                            |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|1400 Providence RdCenter I (O)  |  | 1986 |  | 1996 |  |       |  | 1,042  |  | 9,054  |  | 1,528  |  | 1,042                                               |  | 10,582
|1400 Providence Rd.Center II(O) |  | 1990 |  | 1996 |  |       |  | 1,543  |  | 16,464 |  | 1,837  |  | 1,544                                               |  | 18,300
|MONTGOMERY COUNTY, PENNSYLVANIA  |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                    
|Blue Bell                        |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|16 Sentry Parkway (O)            |  | 1988 |  | 2002 |  |       |  | 3,378  |  | 13,511 |  |       |  | 3,378                                               |  | 13,511
|18 Sentry Parkway (O)            |  | 1988 |  | 2002 |  |       |  | 3,515  |  | 14,062 |  |       |  | 3,515                                               |  | 14,062
|King of Prussia                  |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|2200 Renaissance Blvd (O)        |  | 1985 |  | 2002 |  | 19,100 |  | 5,347  |  | 21,453 |  |       |  | 5,347                                               |  | 21,453
|Lower Providence                 |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|1000 Madison Avenue (O)          |  | 1990 |  | 1997 |  |       |  | 1,713  |  | 12,559 |  | 685    |  | 1,714                                               |  | 13,243
|Plymouth Meeting                 |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|1150 Plymouth Meeting Mall (O)   |  | 1970 |  | 1997 |  |       |  | 125    |  | 499    |  | 21,373 |  | 125                                                 |  | 21,872
|Five Sentry Parkway East (O)     |  | 1984 |  | 1996 |  |       |  | 642    |  | 7,992  |  | 478    |  | 642                                                 |  | 8,470 
|Five Sentry Parkway West (O)     |  | 1984 |  | 1996 |  |       |  | 268    |  | 3,334  |  | 73     |  | 268                                                 |  | 3,407 
|FAIRFIELD COUNTY, CONNECTICUT    |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                    
|Greenwich                        |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|500 West Putnam Avenue (O)       |  | 1973 |  | 1998 |  | 8,417  |  | 3,300  |  | 16,734 |  | 1,175  |  | 3,300                                               |  | 17,909
|Norwalk                          |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|40 Richards Avenue (O)           |  | 1985 |  | 1998 |  |       |  | 1,087  |  | 18,399 |  | 1,990  |  | 1,087                                               |  | 20,389
|Shelton                          |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|1000 Bridgeport Avenue (O)       |  | 1986 |  | 1997 |  |       |  | 773    |  | 14,934 |  | 33     |  | 744                                                 |  | 14,996
|Stamford                         |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                     |  |       
|1266 East Main Street (O)        |  | 1984 |  | 2002 |  | 19,500 |  | 6,638  |  | 26,567 |  |       |  | 6,638                                               |  | 26,567
|419 West Avenue (F)              |  | 1986 |  | 1997 |  |       |  | 4,538  |  | 9,246  |  | 934    |  | 4,538                                               |  | 10,180
|500 West Avenue (F)              |  | 1988 |  | 1997 |  |       |  | 415    |  | 1,679  |  | 214    |  | 415                                                 |  | 1,893 
|550 West Avenue (F)              |  | 1990 |  | 1997 |  |       |  | 1,975  |  | 3,856  |  | 334    |  | 1,975                                               |  | 4,190 
|600 West Avenue (F)              |  | 1999 |  | 1999 |  |       |  | 2,305  |  | 2,863  |  | 833    |  | 2,305                                               |  | 3,696 
|650 West Avenue (F)              |  | 1998 |  | 1998 |  |       |  | 1,328  |  |       |  | 3,913  |  | 1,328                                               |  | 3,913 
|WASHINGTON, D.C.                 |  |      |  |      |  |        |  |        |  |        |  |        |  |                                                    
|1201 Connecticut Avenue, NW (O)  |  | 1940 |  | 1999 |  |       |  | 14,228 |  | 18,571 |  | 1,222  |  | 14,228                                              |  | 19,793
|1400 L Street, NW (O)            |  | 1987 |  | 1998 |  |       |  | 13,054 |  | 27,423 |  | 926    |  | 13,054                                              |  | 28,349

132

---

MACK-CALI REALTY CORPORATION
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2002(dollars in thousands)

SCHEDULE III

|                                 |  |      |  |      |  |   |  |       |  |        |  |        |   | Gross Amount at Which
Carried at Close of Period(1) |  |       
|-------------------------------- |  | ---- |  | ---- |  | - |  | ----- |  | ------ |  | ------ | - | --------------------------------------------------- |  | ------
|
|
|
|
|PRINCE GEORGE'S COUNTY, MARYLAND |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|Lanham                           |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|4200 Parliament Place (O)        |  | 1989 |  | 1998 |  |  |  | 2,114 |  | 13,546 |  | 605    |   | 1,393                                               |  | 14,872
|BEXAR COUNTY, TEXAS              |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|San Antonio                      |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|84 N.E. Loop 410 (O)             |  | 1971 |  | 1997 |  |  |  | 2,295 |  | 10,382 |  | (1,771 | ) | 2,295                                               |  | 8,611 
|111 Soledad (O)                  |  | 1918 |  | 1997 |  |  |  | 2,004 |  | 8,017  |  | 1,156  |   | 2,004                                               |  | 9,173 
|DALLAS COUNTY, TEXAS             |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|Dallas                           |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|3030 LBJ Freeway (O)             |  | 1984 |  | 1997 |  |  |  | 6,098 |  | 24,366 |  | 1,867  |   | 6,098                                               |  | 26,233
|Richardson                       |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|1122 Alma Road (O)               |  | 1977 |  | 1997 |  |  |  | 754   |  | 3,015  |  | 347    |   | 754                                                 |  | 3,362 
|HARRIS COUNTY, TEXAS             |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|Houston                          |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|1770 St. James Place (O)         |  | 1973 |  | 1997 |  |  |  | 730   |  | 2,920  |  | 783    |   | 730                                                 |  | 3,703 
|ARAPAHOE COUNTY, COLORADO        |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|Denver                           |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|400 South Colorado Boulevard (O) |  | 1983 |  | 1998 |  |  |  | 1,461 |  | 10,620 |  | 776    |   | 1,461                                               |  | 11,396
|Englewood                        |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|9359 East Nichols Avenue (O)     |  | 1997 |  | 1998 |  |  |  | 1,155 |  | 8,171  |  | (410   | ) | 1,155                                               |  | 7,761 
|5350 South Roslyn Street (O)     |  | 1982 |  | 1998 |  |  |  | 862   |  | 6,831  |  | (2,607 | ) | 559                                                 |  | 4,527 
|BOULDER COUNTY, COLORADO         |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|Broomfield                       |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|105 South Technology Court (O)   |  | 1997 |  | 1998 |  |  |  | 653   |  | 4,936  |  | (2,968 | ) | 653                                                 |  | 1,968 
|303 South Technology Court-A (O) |  | 1997 |  | 1998 |  |  |  | 623   |  | 3,892  |  | (1,894 | ) | 623                                                 |  | 1,998 
|303 South Technology Court-B (O) |  | 1997 |  | 1998 |  |  |  | 623   |  | 3,892  |  | (1,895 | ) | 623                                                 |  | 1,997 
|Louisville                       |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|1172 Century Drive (O)           |  | 1996 |  | 1998 |  |  |  | 707   |  | 4,647  |  | (789   | ) | 707                                                 |  | 3,858 
|248 Centennial Parkway (O)       |  | 1996 |  | 1998 |  |  |  | 708   |  | 4,647  |  | (789   | ) | 708                                                 |  | 3,858 
|285 Century Place (O)            |  | 1997 |  | 1998 |  |  |  | 889   |  | 10,133 |  | (4,102 | ) | 891                                                 |  | 6,029 
|DENVER COUNTY, COLORADO          |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|Denver                           |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|8181 East Tufts Avenue (O)       |  | 2001 |  | 2001 |  |  |  | 2,342 |  | 32,029 |  | 837    |   | 2,342                                               |  | 32,866
|3600 South Yosemite (O)          |  | 1974 |  | 1998 |  |  |  | 556   |  | 12,980 |  | 28     |   | 556                                                 |  | 13,008
|DOUGLAS COUNTY, COLORADO         |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|Englewood                        |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|67 Inverness Drive East (O)      |  | 1996 |  | 1998 |  |  |  | 1,034 |  | 5,516  |  | (2,976 | ) | 1,035                                               |  | 2,539 
|384 Inverness Drive South (O)    |  | 1985 |  | 1998 |  |  |  | 703   |  | 5,653  |  | (2,512 | ) | 703                                                 |  | 3,141 
|400 Inverness Drive (O)          |  | 1997 |  | 1998 |  |  |  | 1,584 |  | 19,878 |  | (4,953 | ) | 1,584                                               |  | 14,925
|5975 South Quebec Street (O)     |  | 1996 |  | 1998 |  |  |  | 855   |  | 11,551 |  | 1,482  |   | 857                                                 |  | 13,031
|Parker                           |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|9777 Pyramid Court (O)           |  | 1995 |  | 1998 |  |  |  | 1,304 |  | 13,189 |  | 245    |   | 1,306                                               |  | 13,432
|EL PASO COUNTY, COLORADO         |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|Colorado Springs                 |  |      |  |      |  |   |  |       |  |        |  |        |   |                                                     |  |       
|8415 Explorer (O)                |  | 1998 |  | 1999 |  |  |  | 347   |  | 2,507  |  | 2,483  |   | 347                                                 |  | 4,990 
|1975 Research Parkway (O)        |  | 1997 |  | 1998 |  |  |  | 1,397 |  | 13,221 |  | (1,388 | ) | 1,611                                               |  | 11,619
|2375 Telstar Drive (O)           |  | 1998 |  | 1999 |  |  |  | 348   |  | 2,507  |  | 2,483  |   | 348                                                 |  | 4,990 

133

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|                                 |  |      |  |      |  |   |         |  |   |         |  |   |           | Gross Amount at Which
Carried at Close of Period(1) |   |        
|-------------------------------- |  | ---- |  | ---- |  | - | ------- |  | - | ------- |  | - | --------- | --------------------------------------------------- | - | -------
|
|
|
|
|JEFFERSON COUNTY, COLORADO       |  |      |  |      |  |   |         |  |   |         |  |   |           |                                                     |   |        
|Lakewood                         |  |      |  |      |  |   |         |  |   |         |  |   |           |                                                     |   |        
|141 Union Boulevard (O)          |  | 1985 |  | 1998 |  |   |        |  |   | 774     |  |   | 6,891     |                                                     |   | (1,277 
|SAN FRANCISCO COUNTY, CALIFORNIA |  |      |  |      |  |   |         |  |   |         |  |   |           |                                                     |   |        
|San Francisco                    |  |      |  |      |  |   |         |  |   |         |  |   |           |                                                     |   |        
|795 Folsom Street (O)            |  | 1977 |  | 1999 |  |   |        |  |   | 9,348   |  |   | 24,934    |                                                     |   | 6,839  
|760 Market Street (O)            |  | 1908 |  | 1997 |  |   |        |  |   | 5,588   |  |   | 22,352    |                                                     |   | 39,636 
|Projects Under Development       |  |      |  |      |  |   |        |  |   | 53,713  |  |   |          |                                                     |   | 21,566 
|Furniture, Fixtures & Equipment  |  |      |  |      |  |   |        |  |   |        |  |   |          |                                                     |   | 7,533  
|                                 |  |      |  |      |  |   |         |  |   |         |  |   |           |                                                     |   |        
|TOTALS                           |  |      |  |      |  | $ | 568,197 |  | $ | 529,553 |  | $ | 2,900,486 |                                                     | $ | 427,618
|                                 |  |      |  |      |  |   |         |  |   |         |  |   |           |                                                     |   |        

---

|(O) = Office Property               |  | (M) = Multi-family Residential Property |  | 
|----------------------------------- |  | --------------------------------------- |  | 
|(F) = Office/Flex Property          |  | (R) = Stand-alone Retail Property       |  | 
|(I) = Industrial/Warehouse Property |  | (L) = Land Lease                        |  | 

134

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MACK-CALI REALTY CORPORATION
NOTE TO SCHEDULE III

Changes
in rental properties and accumulated depreciation for the periods ended December 31, 2002, 2001 and 2000, are as follows(in
thousands):

|                             |                                                               | 2002 |           | 2001     |   | 2000      |         
|---------------------------- | ------------------------------------------------------------- | ---- | --------- | -------- | - | --------- | --------
|Rental Properties            |                                                               |      |           |          |   |           |         
|Balance at beginning of year |                                                               | $    | 3,378,071 |          | $ | 3,589,877 |         
|                             | Additions                                                     |      |           | 202,082  |   |           | 382,382 
|                             | Rental property held for salebefore accumulated depreciation |      |           | 453,469  |   |           | (453,469
|                             | Properties sold                                               |      |           | (168,245 | ) |           | (140,719
|                             | Retirements/disposals                                         |      |           | (7,720   | ) |           |        
|                             |                                                               |      |           |          |   |           |         
|Balance at end of year       |                                                               | $    | 3,857,657 |          | $ | 3,378,071 |         
|                             |                                                               |      |           |          |   |           |         
|Accumulated Depreciation     |                                                               |      |           |          |   |           |         
|Balance at beginning of year |                                                               | $    | 350,705   |          | $ | 302,932   |         
|                             | Depreciation expense                                          |      |           | 98,050   |   |           | 87,716  
|                             | Rental property held for sale                                 |      |           | 16,455   |   |           | (28,379 
|                             | Properties sold                                               |      |           | (12,121  | ) |           | (11,564 
|                             | Retirements/disposals                                         |      |           | (7,520   | ) |           |        
|                             |                                                               |      |           |          |   |           |         
|Balance at end of year       |                                                               | $    | 445,569   |          | $ | 350,705   |         
|                             |                                                               |      |           |          |   |           |         

134

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MACK-CALI REALTY, L.P.

Signatures

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.

|                    |  | MACK-CALI REALTY, L.P.(Registrant)                          
|------------------- |  | ------------------------------------------------------------
|                    |  | By: Mack-Cali Realty Corporation,
       its General Partner
|Date: March 6, 2003 |  | By:                                                         

Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on
the dates indicated:

|Name                                  |  | Title                                                |  | Date         
|------------------------------------- |  | ---------------------------------------------------- |  | -------------
|                                      |  |                                                      |  |              
|/s/WILLIAM L. MACKWilliam L. Mack     |  | Chairman of the Board                                |  | March 6, 2003
|/s/MITCHELL E. HERSHMitchell E. Hersh |  | Chief Executive Officer and Director                 |  | March 6, 2003
|/s/BARRY LEFKOWITZBarry Lefkowitz     |  | Executive Vice President and Chief Financial Officer |  | March 6, 2003
|/s/JOHN J. CALIJohn J. Cali           |  | Director                                             |  | March 6, 2003
|/s/BRENDAN T. BYRNEBrendan T. Byrne   |  | Director                                             |  | March 6, 2003
|/s/JOHN R. CALIJohn R. Cali           |  | Director                                             |  | March 6, 2003
|/s/NATHAN GANTCHERNathan Gantcher     |  | Director                                             |  | March 6, 2003
|/s/MARTIN D. GRUSSMartin D. Gruss     |  | Director                                             |  | March 6, 2003
|/s/EARLE I. MACKEarle I. Mack         |  | Director                                             |  | March 6, 2003
|                                      |  |                                                      |  |              

135

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|/s/ALAN G. PHILIBOSIANAlan G. Philibosian |  | Director |  | March 6, 2003
|----------------------------------------- |  | -------- |  | -------------
|/s/IRVIN D. REIDIrvin D. Reid             |  | Director |  | March 6, 2003
|/s/VINCENT TESEVincent Tese               |  | Director |  | March 6, 2003
|/s/ROBERT F. WEINBERGRobert F. Weinberg   |  | Director |  | March 6, 2003
|/s/ROY J. ZUCKERBERGRoy J. Zuckerberg     |  | Director |  | March 6, 2003

136

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MACK-CALI REALTY, L.P.

Certification

I, Mitchell E. Hersh, Chief Executive Officer of Mack-Cali Realty Corporation, the general partner of Mack-Cali Realty, L.P., certify
that:





|Date: March 6, 2003 |  | By: | /s/MITCHELL E. HERSHChief Executive Officer
of Mack-Cali Realty Corporation,
the general partner of
Mack-Cali Realty, L.P.
|------------------- |  | --- | --------------------------------------------------------------------------------------------------------------------------

137

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MACK-CALI REALTY, L.P.

Certification

I, Barry Lefkowitz, Chief Financial Officer of Mack-Cali Realty Corporation, the general partner of Mack-Cali Realty, L.P., certify that:





|Date: March 6, 2003 |  | By: | /s/BARRY LEFKOWITZBarry Lefkowitz
Executive Vice President &
    Chief Financial Officer
|------------------- |  | --- | ----------------------------------------------------------------------------------------

138

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MACK-CALI REALTY, L.P.    EXHIBIT INDEX

|Exhibit
Number |  | Exhibit Title                                                                                                                                                                                                                                                                                                        
|-------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1            |  | Restated Charter of Mack-Cali Realty Corporation dated June 11, 2001 (filed as Exhibit 3.1 to the Operating Partnership's Form 10-Q dated June 30, 2001 and incorporated herein by reference).                                                                                                                       
|3.2            |  | Amended and Restated Bylaws of Mack-Cali Realty Corporation dated June 10, 1999 (filed as Exhibit 3.2 to the Corporation's Form 8-K dated June 10, 1999 and incorporated herein by reference).                                                                                                                       
|3.3            |  | Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated December 11, 1997 (filed as Exhibit 10.110 to the Corporation's Form 8-K dated December 11, 1997 and incorporated herein by reference).                                                                                 
|3.4            |  | Amendment No. 1 to the Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated August 21, 1998 (filed as Exhibit 3.1 to the Corporation's and the Operating Partnership's Registration Statement on Form S-3,
Registration No. 333-57103, and incorporated herein by reference).
|3.5            |  | Second Amendment to the Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated July 6, 1999 (filed as Exhibit 10.1 to the Operating Partnership's Form 8-K dated July 6, 1999 and incorporated herein by
reference).                                                           
|3.6            |  | Certificate of Designation of Series B Preferred Operating Partnership Units of Limited Partnership Interest of Mack-Cali Realty, L.P. (filed as Exhibit 10.101 to the Corporation's Form 8-K dated December 11, 1997 and incorporated herein by
reference).                                                         
|4.1            |  | Amended and Restated Shareholder Rights Agreement, dated as of March 7, 2000, between Mack-Cali Realty Corporation and EquiServe Trust Company, N.A., as Rights Agent (filed as Exhibit 4.1 to the Operating Partnership's Form 8-K dated March 7, 2000
and incorporated herein by reference).                       
|4.2            |  | Amendment No. 1 to the Amended and Restated Shareholder Rights Agreement, dated as of June 27, 2000, by and among Mack-Cali Realty Corporation and EquiServe Trust Company, N.A. (filed as Exhibit 4.1 to the Operating Partnership's Form 8-K dated June
27, 2000 and incorporated herein by reference).            
|4.3            |  | Indenture dated as of March 16, 1999, by and among Mack-Cali Realty, L.P., as issuer, Mack-Cali Realty Corporation, as guarantor, and Wilmington Trust Company, as trustee (filed as Exhibit 4.1 to the Operating Partnership's Form 8-K dated March 16,
1999 and incorporated herein by reference).                 
|4.4            |  | Supplemental Indenture No. 1 dated as of March 16, 1999, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership's Form 8-K dated March 16, 1999 and incorporated
herein by reference).                                          
|4.5            |  | Supplemental Indenture No. 2 dated as of August 2, 1999, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.4 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated
herein by reference).                                          
|               |  |                                                                                                                                                                                                                                                                                                                      

139

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|4.6   |  | Supplemental Indenture No. 3 dated as of December 21, 2000, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership's Form 8-K dated December 21, 2000 and
incorporated herein by reference).  
|----- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.7   |  | Supplemental Indenture No. 4 dated as of January 29, 2001, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership's Form 8-K dated January 29, 2001 and incorporated
herein by reference).    
|4.8   |  | Supplemental Indenture No. 5 dated as of December 20, 2002, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership's Form 8-K dated December 20, 2002 and
incorporated herein by reference).
|10.1  |  | Amended and Restated Employment Agreement dated as of July 1, 1999 between Mitchell E. Hersh and Mack-Cali Realty Corporation (filed as Exhibit 10.2 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                           
|10.2  |  | Second Amended and Restated Employment Agreement dated as of July 1, 1999 between Timothy M. Jones and Mack-Cali Realty Corporation (filed as Exhibit 10.3 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                     
|10.3  |  | Second Amended and Restated Employment Agreement dated as of July 1, 1999 between Barry Lefkowitz and Mack-Cali Realty Corporation (filed as Exhibit 10.6 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                      
|10.4  |  | Second Amended and Restated Employment Agreement dated as of July 1, 1999 between Roger W. Thomas and Mack-Cali Realty Corporation (filed as Exhibit 10.7 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                      
|10.5  |  | Employment Agreement dated as of December 5, 2000 between Michael Grossman and Mack-Cali Realty Corporation (filed as Exhibit 10.5 to the Operating Partnership's Form 10-K for the year ended December 31, 2000 and incorporated herein by
reference).                            
|10.6  |  | Restricted Share Award Agreement dated as of July 1, 1999 between Mitchell E. Hersh and Mack-Cali Realty Corporation (filed as Exhibit 10.8 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by
reference).                                    
|10.7  |  | Restricted Share Award Agreement dated as of July 1, 1999 between Timothy M. Jones and Mack-Cali Realty Corporation (filed as Exhibit 10.9 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by reference).                                     
|10.8  |  | Restricted Share Award Agreement dated as of July 1, 1999 between Barry Lefkowitz and Mack-Cali Realty Corporation (filed as Exhibit 10.12 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by reference).                                     
|10.9  |  | Restricted Share Award Agreement dated as of July 1, 1999 between Roger W. Thomas and Mack-Cali Realty Corporation (filed as Exhibit 10.13 to the Operating Partnership's Form 10-Q dated June 30, 1999 and incorporated herein by reference).                                     
|10.10 |  | Restricted Share Award Agreement dated as of March 12, 2001 between Roger W. Thomas and Mack-Cali Realty Corporation (filed as Exhibit 10.10 to the Operating Partnership's Form 10-Q dated March 31, 2001 and incorporated herein by
reference).                                  
|10.11 |  | Restricted Share Award Agreement dated as of March 12, 2001 between Michael Grossman and Mack-Cali Realty Corporation (filed as Exhibit 10.11 to the Operating Partnership's Form 10-Q dated March 31, 2001 and incorporated herein by
reference).                                 
|      |  |                                                                                                                                                                                                                                                                                    

140

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|10.12 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Mitchell E. Hersh (filed as Exhibit 10.1 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                    
|----- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.13 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Mitchell E. Hersh (filed as Exhibit 10.2 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                              
|10.14 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated July 1, 1999 between Mack-Cali Realty Corporation and Mitchell E. Hersh (filed as Exhibit 10.3 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference). 
|10.15 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Timothy M. Jones (filed as Exhibit 10.4 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                     
|10.16 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Timothy M. Jones (filed as Exhibit 10.5 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                               
|10.17 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated July 1, 1999 between Mack-Cali Realty Corporation and Timothy M. Jones (filed as Exhibit 10.6 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference)   
|10.18 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Barry Lefkowitz (filed as Exhibit 10.7 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                      
|10.19 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Barry Lefkowitz (filed as Exhibit 10.8 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                                
|10.20 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated July 1, 1999 between Mack-Cali Realty Corporation and Barry Lefkowitz (filed as Exhibit 10.9 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference).   
|10.21 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Roger W. Thomas (filed as Exhibit 10.10 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                     
|10.22 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Roger W. Thomas (filed as Exhibit 10.11 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                               
|10.23 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated July 1, 1999 between Mack-Cali Realty Corporation and Roger W. Thomas (filed as Exhibit 10.12 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference).  
|10.24 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated March 12, 2001 between Mack-Cali Realty Corporation and Roger W. Thomas (filed as Exhibit 10.13 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference).
|      |  |                                                                                                                                                                                                                                                                                         

141

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|10.25 |  | Restricted Share Award Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.14 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by
reference).                                                                                                                                                                                                                                                                                                                                                                                                                                            
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.26 |  | Tax Gross Up Agreement effective as of January 2, 2003 by and between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.15 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.27 |  | Restricted Share Award Agreement dated December 6, 1999 by and between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.16 to the Corporation's Form 8-K dated January 2, 2003 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|10.28 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated December 6, 1999 between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.17 to the Corporation's Form 8-K dated January 2, 2003
and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                     
|10.29 |  | First Amendment effective as of January 2, 2003 to the Restricted Share Award Agreement dated March 12, 2001 between Mack-Cali Realty Corporation and Michael A. Grossman (filed as Exhibit 10.18 to the Corporation's Form 8-K dated January 2, 2003 and
incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                       
|10.30 |  | Amended and Restated Revolving Credit Agreement dated as of September 27, 2002, among Mack-Cali Realty, L.P. and JPMorgan Chase Bank, Fleet National Bank and Other Lenders Which May Become Parties Thereto with JPMorgan Chase Bank, as administrative
agent, swing lender and fronting bank, Fleet National Bank and Commerzbank AG, New York and Grand Cayman branches as syndication agents, Bank of America, N.A. and Wells Fargo Bank, National Association, as documentation agents, and J.P. Morgan
Securities Inc. and Fleet Securities, Inc, as arrangers (filed as Exhibit 10.1 to the Operating Partnership's Form 8-K dated September 27, 2002 and incorporated herein by reference).
|10.31 |  | Contribution and Exchange Agreement among The MK Contributors, The MK Entities, The Patriot Contributors, The Patriot Entities, Patriot American Management and Leasing Corp., Cali Realty, L.P. and Cali Realty Corporation, dated September 18, 1997
(filed as Exhibit 10.98 to the Corporation's Form 8-K dated September 19, 1997 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                       
|10.32 |  | First Amendment to Contribution and Exchange Agreement, dated as of December 11, 1997, by and among the Company and the Mack Group (filed as Exhibit 10.99 to the Corporation's Form 8-K dated December 11, 1997 and incorporated herein by
reference).                                                                                                                                                                                                                                                                                                                                                                                                                                            
|10.33 |  | Employee Stock Option Plan of Mack-Cali Realty Corporation (filed as Exhibit 10.1 to the Corporation's Post-Effective Amendment No. 1 to Form S-8, Registration No. 333-44443, and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|10.34 |  | Director Stock Option Plan of Mack-Cali Realty Corporation (filed as Exhibit 10.2 to the Corporation's Post-Effective Amendment No. 1 to Form S-8, Registration No. 333-44443, and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|10.35 |  | 2000 Employee Stock Option Plan (filed as Exhibit 10.1 to the Corporation's Registration Statement on Form S-8, Registration No. 333-52478, and incorporated herein by reference), as amended by the First Amendment to the 2000 Employee Stock Option
Plan (filed as Exhibit 10.17 to the Operating Partnership's Form 10-Q dated June 30, 2002 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

142

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|10.36  |  | 2000 Director Stock Option Plan (filed as Exhibit 10.2 to the Corporation's Registration Statement on Form S-8, Registration No. 333-52478, and incorporated herein by reference), as amended by the First Amendment to the 2000 Director Stock Option
Plan (filed as Exhibit 10.18 to the Operating Partnership's Form 10-Q dated June 30, 2002 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                        
|------ |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.37  |  | Deferred Compensation Plan for Directors (filed as Exhibit 10.1 to the Corporation's Registration Statement on Form S-8, Registration No. 333-80081, and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10.38  |  | Form of Indemnification Agreement dated October 22, 2002 by and between Mack-Cali Realty Corporation and each of William L. Mack, John J. Cali, Mitchell E. Hersh, Earle I. Mack, John R. Cali, Brendan T. Byrne, Martin D. Gruss, Nathan Gantcher,
Vincent Tese, Roy J. Zuckerberg, Alan G. Philibosian, Irvin D. Reid, Robert F. Weinberg, Timothy M. Jones, Barry Lefkowitz, Roger W. Thomas, Michael A. Grossman, James Clabby, Anthony Krug, Dean Cingolani, Anthony DeCaro Jr., Mark Durno, William
Fitzpatrick, John Kropke, Nicholas Mitarotonda, Jr., Michael Nevins, Virginia Sobol, Albert Spring and Daniel Wagner (filed as Exhibit 10.28 to the Operating Partnership's Form 10-Q dated September 30, 2002 and incorporated herein by
reference).
|10.39  |  | Indemnification Agreement dated October 22, 2002 by and between Mack-Cali Realty Corporation and John Crandall (filed as Exhibit 10.29 to the Operating Partnership's Form 10-Q dated September 30, 2002 and incorporated herein by
reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10.40  |  | Warrant Agreement, dated December 12, 1997, executed in favor Mitchell E. Hersh to purchase shares of common stock, par value $.01 per share, of the Company (filed as Exhibit 10.106 to the Corporation's Form 8-K dated December 11, 1997 and
incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|10.41  |  | Warrant issued by Cali Realty Corporation to Brad W. Berger, dated January 31, 1997 (filed as Exhibit 10.84 to the Corporation's Form 10-K dated December 31, 1996 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.42  |  | Warrant issued by Cali Realty Corporation to Timothy M. Jones, dated January 31, 1997 (filed as Exhibit 10.86 to the Corporation's Form 10-K dated December 31, 1996 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10.43  |  | Warrant issued by Cali Realty Corporation to Michael Grossman, dated January 31, 1997 (filed as Exhibit 10.89 to the Corporation's Form 10-K dated December 31, 1996 and incorporated herein by reference).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|*10.44 |  | Second Amendment to Contribution and Exchange Agreement, dated as of June 27, 2000, between RMC Development Company, LLC f/k/a Robert Martin Company, LLC, Robert Martin Eastview North Company, L.P., the Corporation and the Operating
Partnership.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|*21    |  | Subsidiaries of the Operating Partnership.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|*23    |  | Consent of PricewaterhouseCoopers LLP, independent accountants.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

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