##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-Q
  þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
 For the quarterly period ended March 31, 2008
 or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
 For the transition period from  to
 Commission file number
    
    001-9106 (Brandywine Realty Trust)000-24407 (Brandywine Operating Partnership, L.P.)
 
 Brandywine Realty Trust
Brandywine Operating Partnership, L.P.
  MARYLAND(Brandywine Realty Trust)
    
    23-2413352DELAWARE(Brandywine Operating Partnership L.P.)
    
    23-2862640(State or other jurisdiction of
    
    (I.R.S. Employer Identification No.)Incorporation or organization)555 East Lancaster AvenueRadnor, Pennsylvania
    
    19087(Address of principal executive offices)
    
    (Zip Code)
 (610) 325-5600
  Brandywine Realty Trust
    
    Yes þ No oBrandywine Operating Partnership, L.P.
    
    Yes þ No o
  Brandywine Realty Trust:
    
    Large accelerated filer þ Accelerated filer o Non-accelerated filer o Smaller reporting company oBrandywine Operating Partnership, L.P.:
    
    Large accelerated filer þ Accelerated filer o Non-accelerated filer o Smaller reporting company o
  Brandywine Realty Trust
    
    Yes o No þBrandywine Operating Partnership, L.P.
    
    Yes o No þ




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TABLE OF CONTENTS
 PageBrandywine Realty TrustPART I  FINANCIAL INFORMATIONItem 1.
    
    Financial Statements (unaudited)Consolidated Balance Sheets as of March 31, 2008 and December 31, 2007
    
    3Consolidated Statements of Operations for the three-month periods ended March 31,
2008 and 2007
    
    4Consolidated Statements of Other Comprehensive Income for the three-month periods
ended March 31, 2008 and 2007
    
    5Consolidated Statements of Cash Flows for the three-month periods ended March 31,
2008 and 2007
    
    6Notes to Unaudited Consolidated Financial Statements
    
    7Brandywine Operating Partnership, L.P.Item 1.
    
    Financial Statements (unaudited)Consolidated Balance Sheets as of March 31, 2008 and December 31, 2007
    
    33Consolidated Statements of Operations for the three-month periods ended March 31,
2008 and 2007
    
    34Consolidated Statements of Other Comprehensive Income for the three-month periods
ended March 31, 2008 and 2007
    
    35Consolidated Statements of Cash Flows for the three-month periods ended March 31,
2008 and 2007
    
    36Notes to Unaudited Consolidated Financial Statements
    
    37Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    61Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    73Item 4.
    
    Controls and Procedures
    
    73PART II  OTHER INFORMATIONItem 1.
    
    Legal Proceedings
    
    74Item 1A.
    
    Risk Factors
    
    74Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    74Item 3.
    
    Defaults Upon Senior Securities
    
    74Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    74Item 5.
    
    Other Information
    
    74Item 6.
    
    Exhibits
    
    74Signatures
    
    76COMPUTATION OF RATIOS OF BRANDYWINE REALTY TRUSTCOMPUTATION OF RATIOS OF BRANDYWINE OPERATING PARTNERSHIPCertification of Chief Executive OfficerCertification of Chief Financial OfficerCertification of Chief Executive Officer, in its capacity as the general partnerCertification of Chief Financial Officer, in its capacity as the general partnerCertification of Chief Executive Officer, Pursuant to Section 906Certification of Chief Financial Officer, Pursuant to Section 906Certification of Chief Executive Officer, in its capacity as the general partner, Pursuant to Section 906Certification of Chief Financial Officer, in its capacity as the general partner, Pursuant to Section 906
  Filing Format
  2




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1.  Financial Statements
 BRANDYWINE REALTY TRUST
 
 CONSOLIDATED BALANCE SHEETS
 (unaudited, in thousands, except share and per share information)
 March 31,
    
    
    December 31,2008
    
    
    2007ASSETSReal estate investments:Operating properties
    
    $
    4,815,994
    
    
    $
    4,813,563Accumulated depreciation
    
    
    (589,115
    )
    
    
    (558,908
    )Operating real estate investments, net
    
    
    4,226,879
    
    
    
    4,254,655Development land and construction-in-progress
    
    
    425,949
    
    
    
    402,270Total real estate invesmtents, net
    
    
    4,652,828
    
    
    
    4,656,925Cash and cash equivalents
    
    
    3,852
    
    
    
    5,600Accounts receivable, net
    
    
    14,065
    
    
    
    17,057Accrued rent receivable, net
    
    
    87,623
    
    
    
    83,098Investment in real estate ventures, at equity
    
    
    72,310
    
    
    
    71,598Deferred costs, net
    
    
    89,202
    
    
    
    87,123Intangible assets, net
    
    
    204,627
    
    
    
    218,149Other assets
    
    
    76,295
    
    
    
    74,549Total assets
    
    $
    5,200,802
    
    
    $
    5,214,099LIABILITIES AND BENEFICIARIES EQUITYMortgage notes payable
    
    $
    608,337
    
    
    $
    611,898Unsecured term loan
    
    
    150,000
    
    
    
    150,000Unsecured notes, net of discounts
    
    
    2,183,981
    
    
    
    2,208,344Unsecured credit facility
    
    
    138,447
    
    
    
    130,727Accounts payable and accrued expenses
    
    
    112,884
    
    
    
    80,732Distributions payable
    
    
    42,336
    
    
    
    42,368Tenant security deposits and deferred rents
    
    
    65,747
    
    
    
    65,241Acquired below market leases, net
    
    
    63,249
    
    
    
    67,281Other liabilities
    
    
    38,964
    
    
    
    30,154Total liabilities
    
    
    3,403,945
    
    
    
    3,386,745Minority interest
    
    
    80,992
    
    
    
    84,119Commitments and contingencies (Note 14)Beneficiaries equity:Preferred Shares (shares authorized-20,000,000):7.50% Series C Preferred Shares, $0.01 par value; issued and outstanding-
2,000,000 in 2008 and 2007
    
    
    20
    
    
    
    207.375% Series D Preferred Shares, $0.01 par value; issued and outstanding-
2,300,000 in 2008 and 2007
    
    
    23
    
    
    
    23Common Shares of beneficial interest, $0.01 par value; shares authorized
200,000,000; 88,612,439 and 88,623,635 issued in 2008 and 2007, respectively
and 87,201,332 and 87,015,600 outstanding in 2008 and 2007, respectively
    
    
    871
    
    
    
    870Additional paid-in capital
    
    
    2,319,355
    
    
    
    2,319,410Common shares in treasury, at cost, 1,411,107 and 1,599,637 in 2008 and 2007,
respectively
    
    
    (50,268
    )
    
    
    (53,449
    )Cumulative earnings
    
    
    494,856
    
    
    
    480,217Accumulated other comprehensive loss
    
    
    (6,489
    )
    
    
    (1,885
    )Cumulative distributions
    
    
    (1,042,503
    )
    
    
    (1,001,971
    )Total beneficiaries equity
    
    
    1,715,865
    
    
    
    1,743,235Total liabilities, minority interest and beneficiaries equity
    
    $
    5,200,802
    
    
    $
    5,214,099
  3




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BRANDYWINE REALTY TRUST
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (unaudited, in thousands, except share and per share information)
 For the three-month periods ended March 31,2008
    
    
    2007Revenue:Rents
    
    $
    137,472
    
    
    $
    137,346Tenant reimbursements
    
    
    19,751
    
    
    
    20,619Termination fees
    
    
    3,257
    
    
    
    1,329Third party management fees, labor reimbursement and leasing
    
    
    5,679
    
    
    
    4,335Other
    
    
    832
    
    
    
    1,168Total revenue
    
    
    166,991
    
    
    
    164,797Operating Expenses:Property operating expenses
    
    
    45,456
    
    
    
    45,040Real estate taxes
    
    
    16,903
    
    
    
    15,922Third party management expenses
    
    
    2,246
    
    
    
    2,495Depreciation and amortization
    
    
    55,871
    
    
    
    61,906General & administrative expenses
    
    
    5,004
    
    
    
    7,269Total operating expenses
    
    
    125,480
    
    
    
    132,632Operating income
    
    
    41,511
    
    
    
    32,165Other Income (Expense):Interest income
    
    
    209
    
    
    
    787Interest expense
    
    
    (37,450
    )
    
    
    (40,358
    )Interest expense  Deferred financing costs
    
    
    (1,508
    )
    
    
    (1,258
    )Equity in income of real estate ventures
    
    
    1,115
    
    
    
    754Net loss on disposition of undepreciated real estate
    
    
    (24
    )
    
    
    Gain on early extinguishment of debt
    
    
    3,356
    
    
    
    Income (loss) before minority interest and discontinuted operations
    
    
    7,209
    
    
    
    (7,910
    )Minority interest  partners share of consolidated real estate ventures
    
    
    (40
    )
    
    
    (116
    )Minority interest attributable to continuing operations  LP units
    
    
    (217
    )
    
    
    428Income (loss) from continuing operations
    
    
    6,952
    
    
    
    (7,598
    )Discontinued operations:Income from discontinued operations
    
    
    53
    
    
    
    2,164Net gain on disposition of discontinued operations
    
    
    7,981
    
    
    
    26,009Minority interest attributable to discontinued operations  LP units
    
    
    (338
    )
    
    
    (1,203
    )Income from discontinued operations
    
    
    7,696
    
    
    
    26,970Net income
    
    
    14,648
    
    
    
    19,372Income allocated to Preferred Shares
    
    
    (1,998
    )
    
    
    (1,998
    )Income allocated to Common Shares
    
    $
    12,650
    
    
    $
    17,374Basic earnings (loss) per Common Share:Continuing operations
    
    $
    0.06
    
    
    $
    (0.11
    )Discontinued operations
    
    
    0.09
    
    
    
    0.31$
    0.15
    
    
    $
    0.20Diluted earnings (loss) per Common Share:Continuing operations
    
    $
    0.06
    
    
    $
    (0.11
    )Discontinued operations
    
    
    0.09
    
    
    
    0.30$
    0.15
    
    
    $
    0.19Dividends declared per Common Share
    
    $
    0.44
    
    
    $
    0.44Basic weighted average shares outstanding
    
    
    87,073,721
    
    
    
    88,287,426Diluted weighted average shares outstanding
    
    
    87,088,131
    
    
    
    89,236,342
  4




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BRANDYWINE REALTY TRUST
 
 CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME
 (unaudited, in thousands)
 For the three-monthperiods ended March 31,2008
    
    
    2007Net income
    
    $
    14,648
    
    
    $
    19,372Other comprehensive income:Unrealized gain (loss) on derivative financial instruments
    
    
    (4,832
    )
    
    
    1,450Reclassification of realized (gains) losses on derivative financial
instruments to operations, net
    
    
    (20
    )
    
    
    9Unrealized gain (loss) on available-for-sale securities
    
    
    248
    
    
    
    (607
    )Total other comprehensive income (loss)
    
    
    (4,604
    )
    
    
    852Comprehensive income
    
    $
    10,044
    
    
    $
    20,224
  5




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BRANDYWINE REALTY TRUST
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (unaudited, in thousands)
 Three-month periodsended March 31,2008
    
    
    2007Cash flows from operating activities:Net income
    
    $
    14,648
    
    
    $
    19,372Adjustments to reconcile net income to net cash from
operating activities:Depreciation
    
    
    40,363
    
    
    
    48,508Amortization:Deferred financing costs
    
    
    1,509
    
    
    
    1,257Deferred leasing costs
    
    
    4,090
    
    
    
    3,842Acquired above (below) market leases, net
    
    
    (2,278
    )
    
    
    (3,613
    )Acquired lease intangibles
    
    
    11,488
    
    
    
    14,247Deferred compensation costs
    
    
    1,307
    
    
    
    1,213Straight-line rent
    
    
    (6,609
    )
    
    
    (7,063
    )Provision for doubtful accounts
    
    
    1,250
    
    
    
    500Real estate venture income in excess of distributions
    
    
    (544
    )
    
    
    (84
    )Net gain on sale of interests in real estate
    
    
    (7,957
    )
    
    
    (26,009
    )Gain on early extinguishment of debt
    
    
    (3,356
    )
    
    
    Minority interest
    
    
    595
    
    
    
    891Changes in assets and liabilities:Accounts receivable
    
    
    3,906
    
    
    
    5,416Other assets
    
    
    (2,808
    )
    
    
    (11,167
    )Accounts payable and accrued expenses
    
    
    20,264
    
    
    
    7,286Tenant security deposits and deferred rents
    
    
    1,032
    
    
    
    3,390Other liabilities
    
    
    (2,732
    )
    
    
    (7,465
    )Net cash from operating activities
    
    
    74,168
    
    
    
    50,521Cash flows from investing activities:Acquisition of minority interest  partners share of consolidated real estate venture
    
    
    
    
    
    
    (63,732
    )Sales of properties, net
    
    
    26,172
    
    
    
    109,127Capital expenditures
    
    
    (38,798
    )
    
    
    (68,015
    )Investment in unconsolidated real estate ventures
    
    
    (249
    )
    
    
    (512
    )Cash distributions from unconsolidated real estate ventures
in excess of equity in income
    
    
    81
    
    
    
    1,849Leasing costs
    
    
    (3,851
    )
    
    
    (9,259
    )Net cash used in investing activities
    
    
    (16,645
    )
    
    
    (30,542
    )Cash flows from financing activities:Proceeds from Credit Facility borrowings
    
    
    57,000
    
    
    
    442,000Repayments of Credit Facility borrowings
    
    
    (49,280
    )
    
    
    (98,000
    )Repayments of mortgage notes payable
    
    
    (3,561
    )
    
    
    (4,695
    )Repayments of unsecured notes
    
    
    (21,027
    )
    
    
    (299,866
    )Debt financing costs
    
    
    (85
    )
    
    
    (72
    )Exercise of stock options
    
    
    
    
    
    
    6,166Repurchases of Common Shares
    
    
    
    
    
    
    (44,677
    )Distributions paid to shareholders
    
    
    (40,514
    )
    
    
    (41,031
    )Distributions to minority interest holders
    
    
    (1,804
    )
    
    
    (1,298
    )Net cash used in financing activities
    
    
    (59,271
    )
    
    
    (41,473
    )Decrease in cash and cash equivalents
    
    
    (1,748
    )
    
    
    (21,494
    )Cash and cash equivalents at beginning of period
    
    
    5,600
    
    
    
    25,379Cash and cash equivalents at end of period
    
    $
    3,852
    
    
    $
    3,885Supplemental disclosure:Cash paid for interest, net of capitalized interest
    
    $
    18,163
    
    
    $
    24,023Supplemental disclosure of non-cash activity:Cash escrowed with qualified intermediary
    
    
    
    
    
    
    109,102
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BRANDYWINE REALTY TRUST
 
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 THE COMPANY
     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Basis of Presentation
  7




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Principles of Consolidation
  Use of Estimates
  Operating Properties
  Purchase Price Allocation
   8




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Accounting for Conditional Asset Retirement Obligations
   Revenue Recognition
  Stock-Based Compensation Plans
  9




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  Accounting for Derivative Instruments and Hedging Activities
 Accounting for Derivative Instruments and Hedging Activities Accounting for Certain Derivative Instruments and Hedging Activities
- An Amendment of SFAS 133 Fair Value
Measurements
  Income Taxes
   10




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  Accounting Pronouncements Adopted January 1, 2008
 Fair Value Measurements Application
of FASB Statement No. 157 to FASB Statement No. 13 and Other Accounting Pronouncements That Address
Fair Value Measurements for Purposes of Lease Classification or Measurement under Statement 13 Effective Date of FASB Statement No. 157 Accounting for Leases
    11




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Fair Value Measurements at ReportingDate Using:Quoted Prices inActive Markets for
    
    
    Significant Other
    
    
    UnobservableMarch 31,
    
    
    Identical Assets
    
    
    Observable Inputs
    
    
    InputsDescription
    
    2008
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Assets:Available-for-Sale Securities
    
    $
    773
    
    
    $
    773
    
    
    $
    
    
    
    
    Liabilities:Interest Rate Swaps
    
    $
    7,911
    
    
    
    
    
    
    $
    7,911
    
    
    
    Forward Starting Interest Rate Swaps
    
    
    99
    
    
    
    
    
    
    
    99
    
    
    
    $
    8,010
    
    
    $
    
    
    
    $
    8,010
    
    
    $
    
  
    
    Non-financial assets and liabilities initially measured at fair value in an acquisition
or business combination that are not remeasured at least annually at fair value
    
    Long-lived assets measured at fair value due to an impairment under Statement of
Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets
    
    Asset retirement obligations initially measured at fair value under Statement of
Financial Accounting Standards No. 143, Accounting for Asset Retirement Obligations
 The Fair Value Option for Financial Assets and Financial Liabilities
 New Pronouncements
 Disclosures
about Derivative Instruments and Hedging Activities Accounting for Derivative Instruments and Hedging Activities
 12




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Business Combinations
 Noncontrolling Interests in Consolidated
Financial Statements  an Amendment of ARB No. 51
  REAL ESTATE INVESTMENTS
  March 31, 2008
    
    
    December 31, 2007Land
    
    $
    723,705
    
    
    $
    727,979Building and improvements
    
    
    3,673,177
    
    
    
    3,672,638Tenant improvements
    
    
    419,112
    
    
    
    412,9464,815,994
    
    
    
    4,813,563
 Acquisitions and Dispositions
  2008
    13




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 2007
 DRA Venture
   Applying the Conditions in Paragraph 42 of FASB
Statement No. 144 in Determining Whether to Report Discontinued Operations
 Other 2007 Acquisitions and Dispositions
      14




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
         INVESTMENT IN UNCONSOLIDATED VENTURES
    15




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
   March 31,
    
    December 31,2008
    
    2007Operating property, net of accumulated depreciation
    
    $
    594,893
    
    
    $
    587,537Other assets
    
    
    108,287
    
    
    
    113,268Liabilities
    
    
    42,965
    
    
    
    41,459Debt
    
    
    538,900
    
    
    
    538,766Equity
    
    
    121,315
    
    
    
    120,581Companys share of equity (Companys basis)
    
    
    72,310
    
    
    
    71,598
  Three-month periodsended March 31,2008
    
    2007Revenue
    
    $
    27,034
    
    
    $
    18,314Operating expenses
    
    
    8,922
    
    
    
    6,297Interest expense, net
    
    
    7,798
    
    
    
    5,238Depreciation and amortization
    
    
    6,909
    
    
    
    4,229Net income
    
    
    3,405
    
    
    
    2,551Companys share of income (Company basis)
    
    
    1,115
    
    
    
    754
  DEFERRED COSTS
  16




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 March 31, 2008Accumulated
    
    
    Deferred Costs,Total Cost
    
    
    Amortization
    
    
    netLeasing Costs
    
    $
    104,683
    
    
    $
    (33,361
    )
    
    $
    71,322Financing Costs
    
    
    27,137
    
    
    
    (9,257
    )
    
    
    17,880Total
    
    $
    131,820
    
    
    $
    (42,618
    )
    
    $
    89,202
 December 31, 2007Accumulated
    
    
    Deferred Costs,Total Cost
    
    
    Amortization
    
    
    netLeasing Costs
    
    $
    99,077
    
    
    $
    (31,259
    )
    
    $
    67,818Financing Costs
    
    
    27,597
    
    
    
    (8,292
    )
    
    
    19,305Total
    
    $
    126,674
    
    
    $
    (39,551
    )
    
    $
    87,123
 INTANGIBLE ASSETS
  March 31, 2008Accumulated
    
    
    Deferred Costs,Total Cost
    
    
    Amortization
    
    
    netIn-place lease value
    
    $
    174,574
    
    
    $
    (67,679
    )
    
    $
    106,895Tenant relationship value
    
    
    120,942
    
    
    
    (36,692
    )
    
    
    84,250Above market leases acquired
    
    
    28,729
    
    
    
    (15,247
    )
    
    
    13,482Total
    
    $
    324,245
    
    
    $
    (119,618
    )
    
    $
    204,627Below market leases acquired
    
    $
    97,884
    
    
    $
    (34,635
    )
    
    $
    63,249
 December 31, 2007Accumulated
    
    
    Deferred Costs,Total Cost
    
    
    Amortization
    
    
    netIn-place lease value
    
    $
    180,456
    
    
    $
    (65,742
    )
    
    $
    114,714Tenant relationship value
    
    
    121,094
    
    
    
    (32,895
    )
    
    
    88,199Above market leases acquired
    
    
    29,337
    
    
    
    (14,101
    )
    
    
    15,236Total
    
    $
    330,887
    
    
    $
    (112,738
    )
    
    $
    218,149Below market leases acquired
    
    $
    103,825
    
    
    $
    (36,544
    )
    
    $
    67,281
  17




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Assets
    
    
    Liabilities2008
    
    $
    35,849
    
    
    $
    10,8252009
    
    
    42,314
    
    
    
    11,9782010
    
    
    35,298
    
    
    
    9,5612011
    
    
    27,323
    
    
    
    7,8412012
    
    
    21,041
    
    
    
    6,900Thereafter
    
    
    42,802
    
    
    
    16,144Total
    
    $
    204,627
    
    
    $
    63,249
 DEBT OBLIGATIONS
  18




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 EffectiveMarch 31
    
    
    December 31,
    
    
    Interest
    
    
    MaturityProperty / Location
    
    2008
    
    
    2007
    
    
    Rate
    
    
    DateMORTGAGE DEBT:400 Commerce Drive
    
    $
    11,519
    
    
    $
    11,575
    
    
    
    7.12
    %
    
    Jun-08Two Logan Square
    
    
    69,805
    
    
    
    70,124
    
    
    
    5.78
    %(a)
    
    Jul-09200 Commerce Drive
    
    
    5,745
    
    
    
    5,765
    
    
    
    7.12
    %(a)
    
    Jan-101333 Broadway
    
    
    23,888
    
    
    
    23,997
    
    
    
    5.54
    %(a)
    
    May-10The Ordway
    
    
    45,328
    
    
    
    45,509
    
    
    
    5.29
    %(a)
    
    Aug-10World Savings Center
    
    
    27,040
    
    
    
    27,142
    
    
    
    5.29
    %(a)
    
    Nov-10Plymouth Meeting Exec.
    
    
    43,304
    
    
    
    43,470
    
    
    
    7.00
    %(a)
    
    Dec-10Four Tower Bridge
    
    
    10,480
    
    
    
    10,518
    
    
    
    6.62
    %
    
    Feb-11Arboretum I, II, III & V
    
    
    22,087
    
    
    
    22,225
    
    
    
    7.59
    %
    
    Jul-11Midlantic Drive/Lenox Drive/DCC I
    
    
    60,925
    
    
    
    61,276
    
    
    
    8.05
    %
    
    Oct-11Research Office Center
    
    
    41,347
    
    
    
    41,527
    
    
    
    5.30
    %(a)
    
    Oct-11Concord Airport Plaza
    
    
    37,338
    
    
    
    37,570
    
    
    
    5.55
    %(a)
    
    Jan-12Six Tower Bridge
    
    
    14,378
    
    
    
    14,472
    
    
    
    7.79
    %
    
    Aug-12Newtown Square/Berwyn Park/Libertyview
    
    
    61,818
    
    
    
    62,125
    
    
    
    7.25
    %
    
    May-13Coppell Associates
    
    
    3,452
    
    
    
    3,512
    
    
    
    6.89
    %
    
    Dec-13Southpoint III
    
    
    4,290
    
    
    
    4,426
    
    
    
    7.75
    %
    
    Apr-14Tysons Corner
    
    
    100,000
    
    
    
    100,000
    
    
    
    5.36
    %(a)
    
    Aug-15Coppell Associates
    
    
    16,600
    
    
    
    16,600
    
    
    
    5.75
    %
    
    Feb-16Principal balance outstanding
    
    
    599,344
    
    
    
    601,833Plus: unamortized fixed-rate debt premiums, net
    
    
    8,993
    
    
    
    10,065Total mortgage indebtedness
    
    $
    608,337
    
    
    $
    611,898UNSECURED DEBT:Sweep Agreement Line
    
    
    3,447
    
    
    
    10,727
    
    
    Libor + 0.75
    %
    Apr-09Private Placement Notes due 2008
    
    
    113,000
    
    
    
    113,000
    
    
    
    4.34
    %
    
    Dec-082009 Five Year Notes
    
    
    275,000
    
    
    
    275,000
    
    
    
    4.62
    %
    
    Nov-09Bank Term Loan
    
    
    150,000
    
    
    
    150,000
    
    
    Libor + 0.80
    %
    Oct-102010 Five Year Notes
    
    
    300,000
    
    
    
    300,000
    
    
    
    5.61
    %
    
    Dec-10Line-of-Credit
    
    
    135,000
    
    
    
    120,000
    
    
    Libor + 0.725
    %
    Jun-113.875% Exchangeable Notes
    
    
    320,500
    
    
    
    345,000
    
    
    
    3.93
    %
    
    Oct-112012 Six Year Notes
    
    
    300,000
    
    
    
    300,000
    
    
    
    5.77
    %
    
    Apr-122014 Ten Year Notes
    
    
    250,000
    
    
    
    250,000
    
    
    
    5.53
    %
    
    Nov-142016 Ten Year Notes
    
    
    250,000
    
    
    
    250,000
    
    
    
    5.95
    %
    
    Apr-162017 Ten Year Notes
    
    
    300,000
    
    
    
    300,000
    
    
    
    5.75
    %
    
    May-17Indenture IA (Preferred Trust I)
    
    
    27,062
    
    
    
    27,062
    
    
    Libor + 1.25
    %
    Mar-35Indenture IB (Preferred Trust I)
    
    
    25,774
    
    
    
    25,774
    
    
    Libor + 1.25
    %
    Apr-35Indenture II (Preferred Trust II)
    
    
    25,774
    
    
    
    25,774
    
    
    Libor + 1.25
    %
    Jul-35Principal balance outstanding
    
    
    2,475,557
    
    
    
    2,492,337Plus: unamortized fixed-rate debt discounts, net
    
    
    (3,129
    )
    
    
    (3,266
    )Total unsecured indebtedness
    
    $
    2,472,428
    
    
    $
    2,489,071Total Debt Obligations
    
    $
    3,080,765
    
    
    $
    3,100,969
 
 (a)
    
    Loans were assumed upon acquisition of the related property. Interest rates presented above
reflect the market rate at the time of acquisition.    19




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
       20




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  2008
    
    $
    132,7892009
    
    
    358,4022010
    
    
    600,1892011
    
    
    587,7612012
    
    
    351,053Thereafter
    
    
    1,044,707Total principal payments
    
    
    3,074,901Net unamortized premiums/discounts
    
    
    5,864Outstanding indebtedness
    
    $
    3,080,765
 RISK MANAGEMENT AND USE OF FINANCIAL INSTRUMENTS
 Risk Management
  Use of Derivative Financial Instruments
   
  21




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##### Table of Contents



BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
    Hedge
    
    Hedge
    
    
    
    
    
    
    Notional
    
    
    
    
    
    
    
    
    Trade
    
    
    MaturityProduct
    
    Type
    
    Designation
    
    
    
    
    Amount
    
    
    
    
    
    Strike
    
    
    Date
    
    
    Date
    
    
    Fair ValueSwap
    
    Interest Rate
    
    Cash Flow
    
    
    (b
    )
    
    $
    67,700
    
    
    
    (a
    )
    
    
    4.709
    %
    
    
    9/20/07
    
    
    
    10/18/10
    
    
    $
    (5,486
    )Swap
    
    Interest Rate
    
    Cash Flow
    
    
    (b
    )
    
    
    25,000
    
    
    
    
    
    
    
    4.415
    %
    
    
    10/19/07
    
    
    
    10/18/10
    
    
    
    (1,186
    )Swap
    
    Interest Rate
    
    Cash Flow
    
    
    (b
    )
    
    
    25,000
    
    
    
    
    
    
    
    3.747
    %
    
    
    11/26/07
    
    
    
    10/18/10
    
    
    
    (774
    )Swap
    
    Interest Rate
    
    Cash Flow
    
    
    (b
    )
    
    
    25,000
    
    
    
    
    
    
    
    3.338
    %
    
    
    9/23/07
    
    
    
    12/18/09
    
    
    
    (465
    )Forward Starting Swap
    
    Interest Rate
    
    Cash Flow
    
    
    (c
    )
    
    
    25,000
    
    
    
    
    
    
    
    4.770
    %
    
    
    1/4/08
    
    
    
    12/18/19
    
    
    
    (416
    )Forward Starting Swap
    
    Interest Rate
    
    Cash Flow
    
    
    (c
    )
    
    
    25,000
    
    
    
    
    
    
    
    4.423
    %
    
    
    3/19/08
    
    
    
    12/18/19
    
    
    
    317$
    192,700
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (8,010
    )
 
 (a)
    
    - Notional amount accreting up to $155,000 through October 8, 2010.(b)
    
    - Hedging unsecured variable rate debt.(c)
    
    - Future issuance of long-term debt with an expected forward starting date in December 2009.  Concentration of Credit Risk
  DISCONTINUED OPERATIONS
  22




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Three-month periodended March 31, 2008Revenue:Rents
    
    $
    394Tenant reimbursements
    
    
    (135
    )Other
    
    
    50Total revenue
    
    
    309Expenses:Property operating expenses
    
    
    125Real estate taxes
    
    
    62Depreciation and amortization
    
    
    69Total operating expenses
    
    
    256Income from discontinued operations before gain on
sale of interests in real estate and minority interest
    
    
    53Net gain on sale of interests in real estate
    
    
    7,981Minority interest attributable to discontinued operations  LP units
    
    
    (338
    )Income from discontinued operations
    
    $
    7,696
  Three-month periodended March 31, 2007Revenue:Rents
    
    $
    11,531Tenant reimbursements
    
    
    888Other
    
    
    69Total revenue
    
    
    12,488Expenses:Property operating expenses
    
    
    4,176Real estate taxes
    
    
    1,413Depreciation and amortization
    
    
    4,735Total operating expenses
    
    
    10,324Income from discontinued operations before gain on
sale of interests in real estate and minority interest
    
    
    2,164Net gain on sale of interests in real estate
    
    
    26,009Minority interest attributable to discontinued operations  LP units
    
    
    (1,203
    )Income from discontinued operations
    
    $
    26,970
  MINORITY INTEREST IN OPERATING PARTNERSHIP AND CONSOLIDATED REAL ESTATE VENTURES
 Operating Partnership
  23




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Minority Interest  Partners Share of Consolidated Real Estate Ventures
     BENEFICIARIES EQUITY
 Earnings per Share (EPS)
  24




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Three-month periods ended March 31,2008
    
    
    2007Basic
    
    
    Diluted
    
    
    Basic
    
    
    DilutedIncome (loss) from continuing operations
    
    $
    6,952
    
    
    $
    6,952
    
    
    $
    (7,598
    )
    
    $
    (7,598
    )Income allocated to Preferred Shares
    
    
    (1,998
    )
    
    
    (1,998
    )
    
    
    (1,998
    )
    
    
    (1,998
    )Income from continuing operations available
to common shareholders
    
    
    4,954
    
    
    
    4,954
    
    
    
    (9,596
    )
    
    
    (9,596
    )Income from discontinued operations
    
    
    7,696
    
    
    
    7,696
    
    
    
    26,970
    
    
    
    26,970Net income available to common shareholders
    
    $
    12,650
    
    
    $
    12,650
    
    
    $
    17,374
    
    
    $
    17,374Weighted-average shares outstanding
    
    
    87,073,721
    
    
    
    87,073,721
    
    
    
    88,287,426
    
    
    
    88,287,426Contingent securities/Stock based compensation
    
    
    
    
    
    
    14,410
    
    
    
    
    
    
    
    948,916Total weighted-average shares outstanding
    
    
    87,073,721
    
    
    
    87,088,131
    
    
    
    88,287,426
    
    
    
    89,236,342Earnings per Common Share:Continuing operations
    
    $
    0.06
    
    
    $
    0.06
    
    
    $
    (0.11
    )
    
    $
    (0.11
    )Discontinued operations
    
    
    0.09
    
    
    
    0.09
    
    
    
    0.31
    
    
    
    0.30$
    0.15
    
    
    $
    0.15
    
    
    $
    0.20
    
    
    $
    0.19
   Common and Preferred Shares
    Common Share Repurchases
  25




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  SHARE BASED COMPENSATION
  Stock Options
  Weighted
    
    Weighted AverageAverage
    
    Remaining Contractual
    
    Aggregate IntrinsicShares
    
    Exercise Price
    
    Term (in years)
    
    Value (in 000s)Outstanding at January 1, 2008
    
    
    1,070,099
    
    
    $
    26.13
    
    
    
    0.54
    
    
    
    (8,775
    )Granted
    
    
    200,916
    
    
    
    20.61
    
    
    
    9.98
    
    
    
    (733
    )Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited or expired
    
    
    (825,389
    )
    
    
    
    
    
    
    
    
    
    
    Outstanding at March 31, 2008
    
    
    445,626
    
    
    $
    21.76
    
    
    
    5.66
    
    
    
    (2,137
    )Vested at March 31, 2008
    
    
    244,710
    
    
    $
    22.70
    
    
    
    2.12
    
    
    
    (1,404
    )Exercisable at March 31, 2008
    
    
    244,710
    
    
    $
    22.70
    
    
    
    2.12
    
    
    
    (1,404
    )
  Restricted Stock Awards
  26




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 WeightedAverage GrantShares
    
    
    Date Fair valueNon-vested at January 1, 2008
    
    
    409,282
    
    
    $
    31.91Granted
    
    
    77,877
    
    
    
    17.32Vested
    
    
    (101,434
    )
    
    
    29.63Forfeited
    
    
    (5,143
    )
    
    
    31.98Non-vested at March 31, 2008
    
    
    380,582
    
    
    $
    29.93
 Outperformance Program
   Employee Share Purchase Plan
  SEGMENT INFORMATION
  27




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  28




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  New Jersey
    
    
    Richmond,
    
    
    California -
    
    
    California -
    
    
    Metropolitan,Pennsylvania
    
    
    /Delaware
    
    
    Virginia
    
    
    North
    
    
    South
    
    
    D.C.
    
    
    Southwest
    
    
    Corporate
    
    
    TotalAs of March 31, 2008:Real estate investments, at cost:Operating properties
    
    $
    1,688,737
    
    
    $
    653,316
    
    
    $
    350,867
    
    
    $
    473,842
    
    
    $
    106,523
    
    
    $
    1,305,366
    
    
    $
    237,343
    
    
    $
    
    
    
    $
    4,815,994Developed land and
construction-in-progress
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    425,949
    
    
    $
    425,949As of December 31, 2007:Real estate investments, at cost:Operating properties
    
    $
    1,682,839
    
    
    $
    663,503
    
    
    $
    348,310
    
    
    $
    472,818
    
    
    $
    106,303
    
    
    $
    1,302,833
    
    
    $
    236,957
    
    
    $
    
    
    
    $
    4,813,563Developed land and
construction-in-progress
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    402,270
    
    
    $
    402,270For the three-months ended March 31, 2008:Total revenue
    
    $
    64,566
    
    
    $
    28,697
    
    
    $
    11,063
    
    
    $
    16,240
    
    
    $
    2,967
    
    
    $
    34,963
    
    
    $
    9,067
    
    
    $
    (572
    )
    
    $
    166,991Property operating expenses
and real estate taxes
    
    
    22,292
    
    
    
    12,327
    
    
    
    3,722
    
    
    
    6,445
    
    
    
    1,194
    
    
    
    12,446
    
    
    
    4,083
    
    
    
    2,096
    
    
    
    64,605Net operating income
    
    $
    42,274
    
    
    $
    16,370
    
    
    $
    7,341
    
    
    $
    9,795
    
    
    $
    1,773
    
    
    $
    22,517
    
    
    $
    4,984
    
    
    $
    (2,668
    )
    
    $
    102,386For the three-months ended March 31, 2007:Total revenue
    
    $
    65,601
    
    
    $
    29,012
    
    
    $
    8,980
    
    
    $
    15,439
    
    
    $
    3,215
    
    
    $
    33,544
    
    
    $
    8,925
    
    
    $
    81
    
    
    $
    164,797Property operating expenses
and real estate taxes
    
    
    25,159
    
    
    
    12,497
    
    
    
    3,014
    
    
    
    5,892
    
    
    
    1,331
    
    
    
    11,505
    
    
    
    3,511
    
    
    
    548
    
    
    
    63,457Net operating income
    
    $
    40,442
    
    
    $
    16,515
    
    
    $
    5,966
    
    
    $
    9,547
    
    
    $
    1,884
    
    
    $
    22,039
    
    
    $
    5,414
    
    
    $
    (467
    )
    
    $
    101,340
 29




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  Three-month periodsended March 31,2008
    
    
    2007(amounts in thousands)Consolidated net operating income
    
    $
    102,386
    
    
    $
    101,340Less:Interest expense
    
    
    (37,450
    )
    
    
    (40,358
    )Deferred financing costs
    
    
    (1,508
    )
    
    
    (1,258
    )Depreciation and amortization
    
    
    (55,871
    )
    
    
    (61,906
    )General & administrative expenses
    
    
    (5,004
    )
    
    
    (7,269
    )Minority interest  partners share of consolidated
real estate ventures
    
    
    (40
    )
    
    
    (116
    )Minority interest attributable to continuing
operations  LP units
    
    
    (217
    )
    
    
    428Plus:Interest income
    
    
    209
    
    
    
    787Equity in income of real estate ventures
    
    
    1,115
    
    
    
    754Net loss on sales of interests in undepreciated real estate
    
    
    (24
    )
    
    
    Gain on early extinguishment of debt
    
    
    3,356
    
    
    
    Income (loss) from continuing operations
    
    
    6,952
    
    
    
    (7,598
    )Income from discontinued operations
    
    
    7,696
    
    
    
    26,970Net income
    
    $
    14,648
    
    
    $
    19,372
 COMMITMENTS AND CONTINGENCIES
 Legal Proceedings
   Environmental
  30




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  Ground Rent
  2008
    
    $
    1,3022009
    
    
    1,9862010
    
    
    2,3182011
    
    
    2,3182012
    
    
    2,318Thereafter
    
    
    291,626
  Other Commitments or Contingencies
    31




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BRANDYWINE REALTY TRUST
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  15.
    
    SUBSEQUENT EVENTS
   32




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1.  Financial Statements
 BRANDYWINE OPERATING PARTNERSHIP, L.P.
 
 CONSOLIDATED BALANCE SHEETS
 (unaudited, in thousands, except share and per share information)
 March 31,
    
    
    December 31,2008
    
    
    2007ASSETSReal estate investments:Operating properties
    
    $
    4,815,994
    
    
    $
    4,813,563Accumulated depreciation
    
    
    (589,115
    )
    
    
    (558,908
    )Operating real estate investments, net
    
    
    4,226,879
    
    
    
    4,254,655Development land and construction-in-progress
    
    
    425,949
    
    
    
    402,270Total real estate invesmtents, net
    
    
    4,652,828
    
    
    
    4,656,925Cash and cash equivalents
    
    
    3,852
    
    
    
    5,600Accounts receivable, net
    
    
    14,065
    
    
    
    17,057Accrued rent receivable, net
    
    
    87,623
    
    
    
    83,098Investment in real estate ventures, at equity
    
    
    72,310
    
    
    
    71,598Deferred costs, net
    
    
    89,202
    
    
    
    87,123Intangible assets, net
    
    
    204,627
    
    
    
    218,149Other assets
    
    
    76,295
    
    
    
    74,549Total assets
    
    $
    5,200,802
    
    
    $
    5,214,099LIABILITIES AND PARTNERS EQUITYMortgage notes payable
    
    $
    608,337
    
    
    $
    611,898Unsecured term loans
    
    
    150,000
    
    
    
    150,000Unsecured notes, net of discounts
    
    
    2,183,981
    
    
    
    2,208,344Unsecured credit facility
    
    
    138,447
    
    
    
    130,727Accounts payable and accrued expenses
    
    
    112,884
    
    
    
    80,732Distributions payable
    
    
    42,336
    
    
    
    42,368Tenant security deposits and deferred rents
    
    
    65,747
    
    
    
    65,241Acquired below market leases, net
    
    
    63,249
    
    
    
    67,281Other liabilities
    
    
    38,964
    
    
    
    30,154Total liabilities
    
    
    3,403,945
    
    
    
    3,386,745Commitments and contingencies (Note 14)Redeemable limited partnership units at redemption value; 3,719,618 and 3,838,229 issued andoutstanding in 2008 and 2007, respectively
    
    
    63,085
    
    
    
    68,819Partners equity:7.50% Series D Preferred Mirror Units; 2,000,000 issued and outstanding in 2008
and 2007
    
    
    47,912
    
    
    
    47,9127.375% Series E Preferred Mirror Units; 2,300,000 issued and outstanding in 2008
and 2007
    
    
    55,538
    
    
    
    55,538General Partnership Capital, 88,612,439 and 88,623,635 units issued in 2008 and
2007, respectively and 87,201,332 and 87,015,600 units outstanding in
2008 and 2007, respectively
    
    
    1,636,811
    
    
    
    1,656,970Accumulated other comprehensive loss
    
    
    (6,489
    )
    
    
    (1,885
    )Total partners equity
    
    
    1,733,772
    
    
    
    1,758,535Total liabilities, minority interest, and partners equity
    
    $
    5,200,802
    
    
    $
    5,214,099
  33




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (unaudited, in thousands, except share and per share information)
 For the three-month periodsended March 31,2008
    
    
    2007Revenue:Rents
    
    $
    137,472
    
    
    $
    137,346Tenant reimbursements
    
    
    19,751
    
    
    
    20,619Termination fees
    
    
    3,257
    
    
    
    1,329Third party management fees, labor reimbursement and leasing
    
    
    5,679
    
    
    
    4,335Other
    
    
    832
    
    
    
    1,168Total revenue
    
    
    166,991
    
    
    
    164,797Operating Expenses:Property operating expenses
    
    
    45,456
    
    
    
    45,040Real estate taxes
    
    
    16,903
    
    
    
    15,922Third party management expenses
    
    
    2,246
    
    
    
    2,495Depreciation and amortization
    
    
    55,871
    
    
    
    61,906General & administrative expenses
    
    
    5,004
    
    
    
    7,269Total operating expenses
    
    
    125,480
    
    
    
    132,632Operating income
    
    
    41,511
    
    
    
    32,165Other Income (Expense):Interest income
    
    
    209
    
    
    
    787Interest expense
    
    
    (37,450
    )
    
    
    (40,358
    )Interest expense  Deferred financing costs
    
    
    (1,508
    )
    
    
    (1,258
    )Equity in income of real estate ventures
    
    
    1,115
    
    
    
    754Net loss on disposition of undepreciated real estate
    
    
    (24
    )
    
    
    Gain on early extnguishment of debt
    
    
    3,356
    
    
    
    Income (loss) before minority interest
    
    
    7,209
    
    
    
    (7,910
    )Minority interest  partners share of consolidated real estate ventures
    
    
    (40
    )
    
    
    (116
    )Income (loss) from continuing operations
    
    
    7,169
    
    
    
    (8,026
    )Discontinued operations:Income from discontinued operations
    
    
    53
    
    
    
    2,164Net gain on disposition of discontinued operations
    
    
    7,981
    
    
    
    26,009Income from discontinued operations
    
    
    8,034
    
    
    
    28,173Net income
    
    
    15,203
    
    
    
    20,147Income allocated to Preferred Units
    
    
    (1,998
    )
    
    
    (1,998
    )Income allocated to Common Partnership Units
    
    $
    13,205
    
    
    $
    18,149Basic earnings per Common Partnership Unit:Continuing operations
    
    $
    0.06
    
    
    $
    (0.11
    )Discontinued operations
    
    
    0.09
    
    
    
    0.31$
    0.15
    
    
    $
    0.20Diluted earnings per Common Partnership Unit:Continuing operations
    
    $
    0.06
    
    
    $
    (0.11
    )Discontinued operations
    
    
    0.09
    
    
    
    0.30$
    0.15
    
    
    $
    0.19Basic weighted average Common Partnership Unit
    
    
    90,895,006
    
    
    
    92,227,034Diluted weighted average Common Partnership Unit
    
    
    90,909,416
    
    
    
    93,175,950
  34




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 
 CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME
 (unaudited, in thousands)
 For the three-month periodsended March 31,2008
    
    
    2007Net income
    
    $
    15,203
    
    
    $
    20,147Other comprehensive income:Unrealized gain (loss) on derivative financial instruments
    
    
    (4,832
    )
    
    
    1,450Reclassification of realized (gains) losses on derivative
financial
instruments to operations, net
    
    
    (20
    )
    
    
    9Unrealized gain (loss) on available-for-sale securities
    
    
    248
    
    
    
    (607
    )Total other comprehensive income (loss)
    
    
    (4,604
    )
    
    
    852Comprehensive income
    
    $
    10,599
    
    
    $
    20,999
  35




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BRANDYWINE OPERATING PARTNERSHIP L.P.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (unaudited, in thousands)
 Three-month periodsended March 31,2008
    
    
    2007Cash flows from operating activities:Net income
    
    $
    15,203
    
    
    $
    20,147Adjustments to reconcile net income to net cash from
operating activities:Depreciation
    
    
    40,363
    
    
    
    48,508Amortization:Deferred financing costs
    
    
    1,509
    
    
    
    1,257Deferred leasing costs
    
    
    4,090
    
    
    
    3,842Acquired above (below) market leases, net
    
    
    (2,278
    )
    
    
    (3,613
    )Acquired lease intangibles
    
    
    11,488
    
    
    
    14,247Deferred compensation costs
    
    
    1,307
    
    
    
    1,213Straight-line rent
    
    
    (6,609
    )
    
    
    (7,063
    )Provision for doubtful accounts
    
    
    1,250
    
    
    
    500Real estate venture income in excess of distributions
    
    
    (544
    )
    
    
    (84
    )Net gain on sale of interests in real estate
    
    
    (7,957
    )
    
    
    (26,009
    )Gain on early extinguishment of debt
    
    
    (3,356
    )
    
    
    Minority interest
    
    
    40
    
    
    
    116Changes in assets and liabilities:Accounts receivable
    
    
    3,906
    
    
    
    5,416Other assets
    
    
    (2,808
    )
    
    
    (11,167
    )Accounts payable and accrued expenses
    
    
    20,264
    
    
    
    7,286Tenant security deposits and deferred rents
    
    
    1,032
    
    
    
    3,390Other liabilities
    
    
    (2,732
    )
    
    
    (7,465
    )Net cash from operating activities
    
    
    74,168
    
    
    
    50,521Cash flows from investing activities:Acquisition of minority interest  partners share of consolidated real estate venture
    
    
    
    
    
    
    (63,732
    )Sales of properties, net
    
    
    26,172
    
    
    
    109,127Capital expenditures
    
    
    (38,798
    )
    
    
    (68,015
    )Investment in unconsolidated real estate ventures
    
    
    (249
    )
    
    
    (512
    )Cash distributions from unconsolidated real estate ventures
in excess of equity in income
    
    
    81
    
    
    
    1,849Leasing costs
    
    
    (3,851
    )
    
    
    (9,259
    )Net cash used in investing activities
    
    
    (16,645
    )
    
    
    (30,542
    )Cash flows from financing activities:Proceeds from Credit Facility borrowings
    
    
    57,000
    
    
    
    442,000Repayments of Credit Facility borrowings
    
    
    (49,280
    )
    
    
    (98,000
    )Repayments of mortgage notes payable
    
    
    (3,561
    )
    
    
    (4,695
    )Repayments of unsecured notes
    
    
    (21,027
    )
    
    
    (299,866
    )Debt financing costs
    
    
    (85
    )
    
    
    (72
    )Exercise of stock options
    
    
    
    
    
    
    6,166Repurchases of Common Partnership Units
    
    
    
    
    
    
    (44,677
    )Distributions paid to preferred and common partnership unitholders
    
    
    (42,318
    )
    
    
    (42,329
    )Net cash used in financing activities
    
    
    (59,271
    )
    
    
    (41,473
    )Decrease in cash and cash equivalents
    
    
    (1,748
    )
    
    
    (21,494
    )Cash and cash equivalents at beginning of period
    
    
    5,600
    
    
    
    25,379Cash and cash equivalents at end of period
    
    $
    3,852
    
    
    $
    3,885Supplemental disclosure:Cash paid for interest, net of capitalized interest
    
    $
    18,163
    
    
    $
    24,023Supplemental disclosure of non-cash activity:Cash escrowed with qualified intermediary
    
    
    
    
    
    
    109,102
  36




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 ORGANIZATION AND NATURE OF OPERATIONS
    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Basis of Presentation
  Principles of Consolidation
  37




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  Use of Estimates
  Operating Properties
  Purchase Price Allocation
   38




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Accounting for Conditional Asset Retirement Obligations
   Revenue Recognition
  Stock-Based Compensation Plans
   39




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Accounting for Derivative Instruments and Hedging Activities
 Accounting for Derivative Instruments and Hedging Activities Accounting for Certain Derivative Instruments and Hedging Activities
 An Amendment of SFAS 133 Fair Value
Measurements
  Income Taxes
   Accounting Pronouncements Adopted January 1, 2008
 Fair Value Measurements Application of FASB Statement No. 157 to FASB Statement No. 13 and Other Accounting Pronouncements
That Address Fair Value Measurements for Purposes of Lease Classification or Measurement under
Statement 13 Effective Date of FASB
Statement No. 157
 40




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Accounting for Leases
    Fair Value Measurements at ReportingDate Using:Quoted Prices inActive Markets for
    
    
    Significant Other
    
    
    UnobservableMarch 31,
    
    
    Identical Assets
    
    
    Observable Inputs
    
    
    InputsDescription
    
    2008
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Assets:Available-for-Sale Securities
    
    $
    773
    
    
    $
    773
    
    
    $
    
    
    
    
    Liabilities:Interest Rate Swaps
    
    $
    7,911
    
    
    
    
    
    
    $
    7,911
    
    
    
    Forward Starting Interest Rate Swaps
    
    
    99
    
    
    
    
    
    
    
    99
    
    
    
    $
    8,010
    
    
    $
    
    
    
    $
    8,010
    
    
    $
    
  
    
    Non-financial assets and liabilities initially measured at fair value in an acquisition
or business combination that are not remeasured at least annually at fair value
 41




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 
    
    Long-lived assets measured at fair value due to an impairment under Statement of
Financial Accounting Standards No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets
    
    Asset retirement obligations initially measured at fair value under Statement of
Financial Accounting Standards No. 143, Accounting for Asset Retirement Obligations
 The Fair Value Option for Financial Assets and Financial Liabilities
 New Pronouncements
 Disclosures
about Derivative Instruments and Hedging Activities Accounting for Derivative Instruments and Hedging Activities
 Business Combinations
 Noncontrolling Interests in Consolidated
Financial Statements  an Amendment of ARB No. 51
  42




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 REAL ESTATE INVESTMENTS
  March 31, 2008
    
    
    December 31, 2007Land
    
    $
    723,705
    
    
    $
    727,979Building and improvements
    
    
    3,673,177
    
    
    
    3,672,638Tenant improvements
    
    
    419,112
    
    
    
    412,9464,815,994
    
    
    
    4,813,563
 Acquisitions and Dispositions
  2008
    2007
 DRA Venture
   Applying the Conditions in Paragraph 42 of FASB
Statement No. 144 in Determining Whether to Report Discontinued Operations
 43




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Other 2007 Acquisitions and Dispositions
            44




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
   INVESTMENT IN UNCONSOLIDATED VENTURES
     March 31,
    
    December 31,2008
    
    2007Operating property, net of accumulated depreciation
    
    $
    594,893
    
    
    $
    587,537Other assets
    
    
    108,287
    
    
    
    113,268Liabilities
    
    
    42,965
    
    
    
    41,459Debt
    
    
    538,900
    
    
    
    538,766Equity
    
    
    121,315
    
    
    
    120,581Partnerships share of equity (Partnerships basis)
    
    
    72,310
    
    
    
    71,598
  45




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Three-month periodsended March 31,2008
    
    2007Revenue
    
    $
    27,034
    
    
    $
    18,314Operating expenses
    
    
    8,922
    
    
    
    6,297Interest expense, net
    
    
    7,798
    
    
    
    5,238Depreciation and amortization
    
    
    6,909
    
    
    
    4,229Net income
    
    
    3,405
    
    
    
    2,551Partnerships share of income (Partnerships
basis)
    
    
    1,115
    
    
    
    754
  DEFERRED COSTS
  March 31, 2008Accumulated
    
    
    Deferred Costs,Total Cost
    
    
    Amortization
    
    
    netLeasing Costs
    
    $
    104,683
    
    
    $
    (33,361
    )
    
    $
    71,322Financing Costs
    
    
    27,137
    
    
    
    (9,257
    )
    
    
    17,880Total
    
    $
    131,820
    
    
    $
    (42,618
    )
    
    $
    89,202
 December 31, 2007Accumulated
    
    
    Deferred Costs,Total Cost
    
    
    Amortization
    
    
    netLeasing Costs
    
    $
    99,077
    
    
    $
    (31,259
    )
    
    $
    67,818Financing Costs
    
    
    27,597
    
    
    
    (8,292
    )
    
    
    19,305Total
    
    $
    126,674
    
    
    $
    (39,551
    )
    
    $
    87,123
 INTANGIBLE ASSETS
  46




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##### Table of Contents



BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 March 31, 2008Accumulated
    
    
    Deferred Costs,Total Cost
    
    
    Amortization
    
    
    netIn-place lease value
    
    $
    174,574
    
    
    $
    (67,679
    )
    
    $
    106,895Tenant relationship value
    
    
    120,942
    
    
    
    (36,692
    )
    
    
    84,250Above market leases acquired
    
    
    28,729
    
    
    
    (15,247
    )
    
    
    13,482Total
    
    $
    324,245
    
    
    $
    (119,618
    )
    
    $
    204,627Below market leases acquired
    
    $
    97,884
    
    
    $
    (34,635
    )
    
    $
    63,249
 December 31, 2007Accumulated
    
    
    Deferred Costs,Total Cost
    
    
    Amortization
    
    
    netIn-place lease value
    
    $
    180,456
    
    
    $
    (65,742
    )
    
    $
    114,714Tenant relationship value
    
    
    121,094
    
    
    
    (32,895
    )
    
    
    88,199Above market leases acquired
    
    
    29,337
    
    
    
    (14,101
    )
    
    
    15,236Total
    
    $
    330,887
    
    
    $
    (112,738
    )
    
    $
    218,149Below market leases acquired
    
    $
    103,825
    
    
    $
    (36,544
    )
    
    $
    67,281
  Assets
    
    
    Liabilities2008
    
    $
    35,849
    
    
    $
    10,8252009
    
    
    42,314
    
    
    
    11,9782010
    
    
    35,298
    
    
    
    9,5612011
    
    
    27,323
    
    
    
    7,8412012
    
    
    21,041
    
    
    
    6,900Thereafter
    
    
    42,802
    
    
    
    16,144Total
    
    $
    204,627
    
    
    $
    63,249
 DEBT OBLIGATIONS
  47




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 EffectiveMarch 31,
    
    
    December 31,
    
    
    Interest
    
    
    
    MaturityProperty / Location
    
    2008
    
    
    2007
    
    
    Rate
    
    
    
    DateMORTGAGE DEBT400 Commerce Drive
    
    
    11,519
    
    
    
    11,575
    
    
    7.12%
    
    
    
    Jun-08Two Logan Square
    
    
    69,805
    
    
    
    70,124
    
    
    5.78%
    
    (a)
    
    Jul-09200 Commerce Drive
    
    
    5,745
    
    
    
    5,765
    
    
    7.12%
    
    (a)
    
    Jan-101333 Broadway
    
    
    23,888
    
    
    
    23,997
    
    
    5.54%
    
    (a)
    
    May-10The Ordway
    
    
    45,328
    
    
    
    45,509
    
    
    5.29%
    
    (a)
    
    Aug-10World Savings Center
    
    
    27,040
    
    
    
    27,142
    
    
    5.29%
    
    (a)
    
    Nov-10Plymouth Meeting Exec.
    
    
    43,304
    
    
    
    43,470
    
    
    7.00%
    
    (a)
    
    Dec-10Four Tower Bridge
    
    
    10,480
    
    
    
    10,518
    
    
    6.62%
    
    
    
    Feb-11Arboretum I, II, III & V
    
    
    22,087
    
    
    
    22,225
    
    
    7.59%
    
    
    
    Jul-11Midlantic Drive/Lenox Drive/DCC I
    
    
    60,925
    
    
    
    61,276
    
    
    8.05%
    
    
    
    Oct-11Research Office Center
    
    
    41,347
    
    
    
    41,527
    
    
    5.30%
    
    (a)
    
    Oct-11Concord Airport Plaza
    
    
    37,338
    
    
    
    37,570
    
    
    5.55%
    
    (a)
    
    Jan-12Six Tower Bridge
    
    
    14,378
    
    
    
    14,472
    
    
    7.79%
    
    
    
    Aug-12Newtown Square/Berwyn Park/Libertyview
    
    
    61,818
    
    
    
    62,125
    
    
    7.25%
    
    
    
    May-13Coppell Associates
    
    
    3,452
    
    
    
    3,512
    
    
    6.89%
    
    
    
    Dec-13Southpoint III
    
    
    4,290
    
    
    
    4,426
    
    
    7.75%
    
    
    
    Apr-14Tysons Corner
    
    
    100,000
    
    
    
    100,000
    
    
    5.36%
    
    (a)
    
    Aug-15Coppell Associates
    
    
    16,600
    
    
    
    16,600
    
    
    5.75%
    
    
    
    Mar-16Principal balance outstanding
    
    
    599,344
    
    
    
    601,833Plus: unamortized fixed-rate debt premiums
    
    
    8,993
    
    
    
    10,065Total mortgage indebtedness
    
    $
    608,337
    
    
    $
    611,898UNSECURED DEBT:Sweep Agreement Line
    
    
    3,447
    
    
    
    10,727
    
    
    Libor + 0.75%
    
    
    
    Apr-09Private Placement Notes due 2008
    
    
    113,000
    
    
    
    113,000
    
    
    4.34%
    
    
    
    Dec-082009 Five Year Notes
    
    
    275,000
    
    
    
    275,000
    
    
    4.62%
    
    
    
    Nov-09Bank Term Loan
    
    
    150,000
    
    
    
    150,000
    
    
    Libor + 0.80%
    
    
    
    Oct-102010 Five Year Notes
    
    
    300,000
    
    
    
    300,000
    
    
    5.61%
    
    
    
    Dec-10Line-of-Credit
    
    
    135,000
    
    
    
    120,000
    
    
    Libor + 0.725%
    
    
    
    Jun-113.875% Exchangeable Notes
    
    
    320,500
    
    
    
    345,000
    
    
    3.93%
    
    
    
    Oct-112012 Six Year Notes
    
    
    300,000
    
    
    
    300,000
    
    
    5.77%
    
    
    
    Apr-122014 Ten Year Notes
    
    
    250,000
    
    
    
    250,000
    
    
    5.53%
    
    
    
    Nov-142016 Ten Year Notes
    
    
    250,000
    
    
    
    250,000
    
    
    5.95%
    
    
    
    Apr-162017 Ten Year Notes
    
    
    300,000
    
    
    
    300,000
    
    
    5.75%
    
    
    
    May-17Indenture IA (Preferred Trust I)
    
    
    27,062
    
    
    
    27,062
    
    
    Libor + 1.25%
    
    
    
    Mar-35Indenture IB (Preferred Trust I)
    
    
    25,774
    
    
    
    25,774
    
    
    Libor + 1.25%
    
    
    
    Apr-35Indenture II (Preferred Trust II)
    
    
    25,774
    
    
    
    25,774
    
    
    Libor + 1.25%
    
    
    
    Jul-35Principal balance outstanding
    
    
    2,475,557
    
    
    
    2,492,337Plus: unamortized fixed-rate debt premiums
    
    
    (3,129
    )
    
    
    (3,266
    )Total mortgage indebtedness
    
    $
    2,472,428
    
    
    $
    2,489,071Total Debt Obligations
    
    $
    3,080,765
    
    
    $
    3,100,969
 
 (a)
    
    Loans were assumed upon acquisition of the related property. Interest rates presented above
reflect the market rate at the time of acquisition.    48




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
      49




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  2008
    
    $
    132,7892009
    
    
    358,4022010
    
    
    600,1892011
    
    
    587,7612012
    
    
    351,053Thereafter
    
    
    1,044,707Total principal payments
    
    
    3,074,901Net unamortized premiums/discounts
    
    
    5,864Outstanding indebtedness
    
    $
    3,080,765
 RISK MANAGEMENT AND USE OF FINANCIAL INSTRUMENTS
 Risk Management
  Use of Derivative Financial Instruments
     50




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
   Hedge
    
    Hedge
    
    
    
    
    
    
    
    
    
    
    Notional
    
    
    
    
    
    
    
    
    
    
    Trade
    
    
    MaturityProduct
    
    Type
    
    
    Designation
    
    
    
    
    
    
    Amount
    
    
    
    
    
    
    Strike
    
    
    Date
    
    
    Date
    
    
    Fair ValueSwap
    
    Interest Rate
    
    Cash Flow
    (b)
    
    
    
    
    $
    67,700
    
    (a)
    
    
    
    
    
    4.709
    %
    
    
    9/20/07
    
    
    
    10/18/10
    
    
    $
    (5,486
    )Swap
    
    Interest Rate
    
    Cash Flow
    (b)
    
    
    
    
    
    25,000
    
    
    
    
    
    
    
    4.415
    %
    
    
    10/19/07
    
    
    
    10/18/10
    
    
    
    (1,186
    )Swap
    
    Interest Rate
    
    Cash Flow
    (b)
    
    
    
    
    
    25,000
    
    
    
    
    
    
    
    3.747
    %
    
    
    11/26/07
    
    
    
    10/18/10
    
    
    
    (774
    )Swap
    
    Interest Rate
    
    Cash Flow
    (b)
    
    
    
    
    
    25,000
    
    
    
    
    
    
    
    3.338
    %
    
    
    9/23/07
    
    
    
    12/18/09
    
    
    
    (465
    )Forward Starting Swap
    
    Interest Rate
    
    Cash Flow
    (c)
    
    
    
    
    
    25,000
    
    
    
    
    
    
    
    4.770
    %
    
    
    1/4/08
    
    
    
    12/18/19
    
    
    
    (416
    )Forward Starting Swap
    
    Interest Rate
    
    Cash Flow
    (c)
    
    
    
    
    
    25,000
    
    
    
    
    
    
    
    4.423
    %
    
    
    3/19/08
    
    
    
    12/18/19
    
    
    
    317$
    192,700
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (8,010
    )
 
 (a)
    
    - Notional amount accreting up to $155,000 through October 8, 2010.(b)
    
    - Hedging unsecured variable rate debt.(c)
    
    - Future issuance of long-term debt with an expected forward starting date in December 2009.  Concentration of Credit Risk
  DISCONTINUED OPERATIONS
  51




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Three-month periodended March 31, 2008Revenue:Rents
    
    $
    394Tenant reimbursements
    
    
    (135
    )Other
    
    
    50Total revenue
    
    
    309Expenses:Property operating expenses
    
    
    125Real estate taxes
    
    
    62Depreciation and amortization
    
    
    69Total operating expenses
    
    
    256Income from discontinued operations before gain on
sale of interests in real estate and minority interest
    
    
    53Net gain on sale of interests in real estate
    
    
    7,981Income from discontinued operations
    
    $
    8,034
  Three-month periodended March 31, 2007Revenue:Rents
    
    $
    11,531Tenant reimbursements
    
    
    888Other
    
    
    69Total revenue
    
    
    12,488Expenses:Property operating expenses
    
    
    4,176Real estate taxes
    
    
    1,413Depreciation and amortization
    
    
    4,735Total operating expenses
    
    
    10,324Income from discontinued operations before gain on
sale of interests in real estate and minority interest
    
    
    2,164Net gain on sale of interests in real estate
    
    
    26,009Income from discontinued operations
    
    $
    28,173
  MINORITY INTEREST  PARTNERS SHARE OF CONSOLIDATED REAL ESTATE VENTURES
   52




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
   PARTNERS EQUITY
 Earnings per Common Partnership Unit
  Three-month periods ended March 31,2008
    
    
    2007Basic
    
    
    Diluted
    
    
    Basic
    
    
    DilutedIncome (loss) from continuing operations
    
    $
    7,169
    
    
    $
    7,169
    
    
    $
    (8,026
    )
    
    $
    (8,026
    )Income allocated to Preferred Units
    
    
    (1,998
    )
    
    
    (1,998
    )
    
    
    (1,998
    )
    
    
    (1,998
    )Net income a from continuing operations available to
common unitholders
    
    
    5,171
    
    
    
    5,171
    
    
    
    (10,024
    )
    
    
    (10,024
    )Income from discontinued operations
    
    
    8,034
    
    
    
    8,034
    
    
    
    28,173
    
    
    
    28,173Net income available to common shareholders
    
    $
    13,205
    
    
    $
    13,205
    
    
    $
    18,149
    
    
    $
    18,149Weighted-average common partnership units outstanding
    
    
    90,895,006
    
    
    
    90,895,006
    
    
    
    92,227,034
    
    
    
    92,227,034Contingent securities/Stock based compensation
    
    
    
    
    
    
    14,410
    
    
    
    
    
    
    
    948,916Total weighted-average partnership units outstanding
    
    
    90,895,006
    
    
    
    90,909,416
    
    
    
    92,227,034
    
    
    
    93,175,950Earnings per Common Partnership Unit:Continuing operations
    
    $
    0.06
    
    
    $
    0.06
    
    
    $
    (0.11
    )
    
    $
    (0.11
    )Discontinued operations
    
    
    0.09
    
    
    
    0.09
    
    
    
    0.31
    
    
    
    0.30$
    0.15
    
    
    $
    0.15
    
    
    $
    0.20
    
    
    $
    0.19
 Common Partnership Unit and Preferred Mirror Units
   53




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 Common Share Repurchases
  SHARE BASED COMPENSATION
  Stock Options
  Weighted
    
    
    Weighted AverageAverage
    
    
    Remaining Contractual
    
    
    Aggregate IntrinsicShares
    
    
    Exercise Price
    
    
    Term (in years)
    
    
    Value (in 000s)Outstanding at January 1, 2008
    
    
    1,070,099
    
    
    $
    26.13
    
    
    
    0.54
    
    
    
    (8,775
    )Granted
    
    
    200,916
    
    
    
    20.61
    
    
    
    9.98
    
    
    
    (733
    )Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited or expired
    
    
    (825,389
    )
    
    
    
    
    
    
    
    
    
    
    Outstanding at March 31, 2008
    
    
    445,626
    
    
    $
    21.76
    
    
    
    5.66
    
    
    
    (2,137
    )Vested at March 31, 2008
    
    
    244,710
    
    
    $
    22.70
    
    
    
    2.12
    
    
    
    (1,404
    )Exercisable at March 31, 2007
    
    
    244,710
    
    
    $
    22.70
    
    
    
    2.12
    
    
    
    (1,404
    )
  Restricted Stock Awards
  54




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
 WeightedAverage GrantShares
    
    
    Date Fair valueNon-vested at January 1, 2008
    
    
    409,282
    
    
    $
    31.91Granted
    
    
    77,877
    
    
    
    17.32Vested
    
    
    (101,434
    )
    
    
    29.63Forfeited
    
    
    (5,143
    )
    
    
    31.98Non-vested at March 31, 2008
    
    
    380,582
    
    
    $
    29.93
 Outperformance Program
   Employee Share Purchase Plan
  SEGMENT INFORMATION
  55




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  56




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  New Jersey
    
    
    Richmond,
    
    
    California -
    
    
    California -
    
    
    Metropolitan,Pennsylvania
    
    
    /Delaware
    
    
    Virginia
    
    
    North
    
    
    South
    
    
    D.C.
    
    
    Southwest
    
    
    Corporate
    
    
    TotalAs of March 31, 2008:Real estate investments, at cost:Operating properties
    
    $
    1,688,737
    
    
    $
    653,316
    
    
    $
    350,867
    
    
    $
    473,842
    
    
    $
    106,523
    
    
    $
    1,305,366
    
    
    $
    237,343
    
    
    $
    
    
    
    $
    4,815,994Developed land and
construction-in-progress
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    425,949
    
    
    $
    425,949As of December 31, 2007:Real estate investments, at cost:Operating properties
    
    $
    1,682,839
    
    
    $
    663,503
    
    
    $
    348,310
    
    
    $
    472,818
    
    
    $
    106,303
    
    
    $
    1,302,833
    
    
    $
    236,957
    
    
    $
    
    
    
    $
    4,813,563Developed land and
construction-in-progress
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    402,270
    
    
    $
    402,270For the three-months ended March 31, 2008:Total revenue
    
    $
    64,566
    
    
    $
    28,697
    
    
    $
    11,063
    
    
    $
    16,240
    
    
    $
    2,967
    
    
    $
    34,963
    
    
    $
    9,067
    
    
    $
    (572
    )
    
    $
    166,991Property operating expenses
and real estate taxes
    
    
    22,292
    
    
    
    12,327
    
    
    
    3,722
    
    
    
    6,445
    
    
    
    1,194
    
    
    
    12,446
    
    
    
    4,083
    
    
    
    2,096
    
    
    
    64,605Net operating income
    
    $
    42,274
    
    
    $
    16,370
    
    
    $
    7,341
    
    
    $
    9,795
    
    
    $
    1,773
    
    
    $
    22,517
    
    
    $
    4,984
    
    
    $
    (2,668
    )
    
    $
    102,386For the three-months ended March 31, 2007:Total revenue
    
    $
    65,601
    
    
    $
    29,012
    
    
    $
    8,980
    
    
    $
    15,439
    
    
    $
    3,215
    
    
    $
    33,544
    
    
    $
    8,925
    
    
    $
    81
    
    
    $
    164,797Property operating expenses
and real estate taxes
    
    
    25,159
    
    
    
    12,497
    
    
    
    3,014
    
    
    
    5,892
    
    
    
    1,331
    
    
    
    11,505
    
    
    
    3,511
    
    
    
    548
    
    
    
    63,457Net operating income
    
    $
    40,442
    
    
    $
    16,515
    
    
    $
    5,966
    
    
    $
    9,547
    
    
    $
    1,884
    
    
    $
    22,039
    
    
    $
    5,414
    
    
    $
    (467
    )
    
    $
    101,340
 57




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  Three-month periodsended March 31,2008
    
    
    2007(amounts in thousands)Consolidated net operating income
    
    $
    102,386
    
    
    $
    101,340Less:Interest expense
    
    
    (37,450
    )
    
    
    (40,358
    )Deferred financing costs
    
    
    (1,508
    )
    
    
    (1,258
    )Depreciation and amortization
    
    
    (55,871
    )
    
    
    (61,906
    )General & administrative expenses
    
    
    (5,004
    )
    
    
    (7,269
    )Minority interest  partners share of consolidated
real estate ventures
    
    
    (40
    )
    
    
    (116
    )Plus:Interest income
    
    
    209
    
    
    
    787Equity in income of real estate ventures
    
    
    1,115
    
    
    
    754Net loss on sales of interests in undepreciated
real estate
    
    
    (24
    )
    
    
    Gain on early extinguishment of debt
    
    
    3,356
    
    
    
    Income (loss) from continuing operations
    
    
    7,169
    
    
    
    (8,026
    )Income from discontinued operations
    
    
    8,034
    
    
    
    28,173Net income
    
    $
    15,203
    
    
    $
    20,147
 COMMITMENTS AND CONTINGENCIES
 Legal Proceedings
   Environmental
  58




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  Ground Rent
  2008
    
    $
    1,3022009
    
    
    1,9862010
    
    
    2,3182011
    
    
    2,3182012
    
    
    2,318Thereafter
    
    
    291,626
  Other Commitments or Contingencies
    59




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BRANDYWINE OPERATING PARTNERSHIP, L.P.
 NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 March 31, 2008
  SUBSEQUENT EVENTS
   60




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations
  
    
    our failure to lease unoccupied space in accordance with our projections;
    
    our failure to re-lease occupied space upon expiration of leases;
    
    the bankruptcy of major tenants;
    
    changes in prevailing interest rates;
    
    the impact of unrealized hedging transactions;
    
    the unavailability of equity and debt financing;
    
    unanticipated costs associated with the acquisition, integration and operation of our
acquisitions;
    
    unanticipated costs to complete, lease-up and operate our developments and
redevelopments;
    
    impairment charges;
    
    increased costs for, or lack of availability of, adequate insurance, including for
terrorist acts;
    
    risks associated with actual or threatened terrorist attacks;
    
    demand for tenant services beyond those traditionally provided by landlords;
    
    potential liability under environmental or other laws;
    
    earthquakes and other natural disasters;
    
    risks associated with state and local tax audits;
    
    complex regulations relating to our status as a REIT and the adverse consequences of our
failure to qualify as a REIT;
    
    changes in local real estate conditions (including changes in rental rates and the
number of competing properties);
    
    changes in the economic conditions affecting industries in which our principal tenants
compete;
    
    changes in general economic conditions;
    
    the impact of newly adopted accounting principles on our accounting policies and on
period-to-period comparisons of financial results and the other risks identified in the
Risk Factors section and elsewhere in our Annual Report on Form 10-K for the year ended
December 31, 2007.
     61




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Tenant Rollover Risk
  Tenant Credit Risk
  Development Risk
  62




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63




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Comparison of the Three-Month Periods Ended March 31, 2008 and 2007
  Applying the Conditions in Paragraph 42 of FASB
Statement No. 144 in Determining Whether to Report Discontinued Operations
  64




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Acquired/Completed
    
    
    Development/Redevelopment
    
    
    OtherSame Store Property Portfolio
    
    
    Properties
    
    
    Properties (a)
    
    
    (Eliminations) (b)
    
    
    Total PortfolioIncrease/
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Increase/(dollars in thousands)
    
    2008
    
    
    2007
    
    
    (Decrease)
    
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007
    
    
    (Decrease)Revenue:Cash rents
    
    $
    116,383
    
    
    $
    113,865
    
    
    $
    2,518
    
    
    $
    8,976
    
    
    $
    3,446
    
    
    $
    3,956
    
    
    $
    3,584
    
    
    $
    (703
    )
    
    $
    5,399
    
    
    $
    128,612
    
    
    $
    126,294
    
    
    $
    2,318Straight-line rents
    
    
    4,214
    
    
    
    5,453
    
    
    
    (1,239
    )
    
    
    1,956
    
    
    
    2,475
    
    
    
    413
    
    
    
    154
    
    
    
    
    
    
    
    126
    
    
    
    6,583
    
    
    
    8,208
    
    
    
    (1,625
    )Rents  FAS 141
    
    
    1,739
    
    
    
    2,849
    
    
    
    (1,110
    )
    
    
    (33
    )
    
    
    (62
    )
    
    
    571
    
    
    
    57
    
    
    
    
    
    
    
    
    
    
    
    2,277
    
    
    
    2,844
    
    
    
    (567
    )Total rents
    
    
    122,336
    
    
    
    122,167
    
    
    
    169
    
    
    
    10,899
    
    
    
    5,859
    
    
    
    4,940
    
    
    
    3,795
    
    
    
    (703
    )
    
    
    5,525
    
    
    
    137,472
    
    
    
    137,346
    
    
    
    126Tenant reimbursements
    
    
    17,437
    
    
    
    18,521
    
    
    
    (1,084
    )
    
    
    1,162
    
    
    
    594
    
    
    
    1,060
    
    
    
    540
    
    
    
    92
    
    
    
    964
    
    
    
    19,751
    
    
    
    20,619
    
    
    
    (868
    )Termination fess
    
    
    3,257
    
    
    
    494
    
    
    
    2,763
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    63
    
    
    
    
    
    
    
    772
    
    
    
    3,257
    
    
    
    1,329
    
    
    
    1,928Third party management fees, labor reimbursement and leasing
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,679
    
    
    
    4,335
    
    
    
    5,679
    
    
    
    4,335
    
    
    
    1,344Other, excluding termination fees
    
    
    558
    
    
    
    736
    
    
    
    (178
    )
    
    
    20
    
    
    
    4
    
    
    
    4
    
    
    
    (34
    )
    
    
    250
    
    
    
    462
    
    
    
    832
    
    
    
    1,168
    
    
    
    (336
    )Total revenue
    
    
    143,588
    
    
    
    141,918
    
    
    
    1,670
    
    
    
    12,081
    
    
    
    6,457
    
    
    
    6,004
    
    
    
    4,364
    
    
    
    5,318
    
    
    
    12,058
    
    
    
    166,991
    
    
    
    164,797
    
    
    
    2,194Property operating expenses
    
    
    40,006
    
    
    
    41,050
    
    
    
    1,044
    
    
    
    3,351
    
    
    
    2,023
    
    
    
    2,183
    
    
    
    1,932
    
    
    
    (84
    )
    
    
    35
    
    
    
    45,456
    
    
    
    45,040
    
    
    
    (416
    )Real estate taxes
    
    
    14,407
    
    
    
    13,335
    
    
    
    (1,072
    )
    
    
    1,223
    
    
    
    812
    
    
    
    1,165
    
    
    
    668
    
    
    
    108
    
    
    
    1,107
    
    
    
    16,903
    
    
    
    15,922
    
    
    
    (981
    )Management expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,246
    
    
    
    2,495
    
    
    
    2,246
    
    
    
    2,495
    
    
    
    249Subtotal
    
    
    89,175
    
    
    
    87,533
    
    
    
    1,642
    
    
    
    7,507
    
    
    
    3,622
    
    
    
    2,656
    
    
    
    1,764
    
    
    
    3,048
    
    
    
    8,421
    
    
    
    102,386
    
    
    
    101,340
    
    
    
    1,046General & administrative expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,004
    
    
    
    7,269
    
    
    
    5,004
    
    
    
    7,269
    
    
    
    2,265Depreciation and amortization
    
    
    48,356
    
    
    
    48,824
    
    
    
    468
    
    
    
    4,483
    
    
    
    4,067
    
    
    
    2,141
    
    
    
    5,140
    
    
    
    891
    
    
    
    3,875
    
    
    
    55,871
    
    
    
    61,906
    
    
    
    6,035Operating Income (loss)
    
    $
    40,819
    
    
    $
    38,709
    
    
    $
    2,110
    
    
    $
    3,024
    
    
    $
    (445
    )
    
    $
    515
    
    
    $
    (3,376
    )
    
    $
    (2,847
    )
    
    $
    (2,723
    )
    
    $
    41,511
    
    
    $
    32,165
    
    
    $
    9,346Number of properties
    
    
    228
    
    
    
    
    
    
    
    
    
    
    
    13
    
    
    
    
    
    
    
    14
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    255Square feet
    
    
    23,234
    
    
    
    
    
    
    
    
    
    
    
    1,814
    
    
    
    
    
    
    
    3,660
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    28,708Other Income (Expense):Interest income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    209
    
    
    
    787
    
    
    
    (578
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (37,450
    )
    
    
    (40,358
    )
    
    
    2,908Interest expense  Deferred financing costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,508
    )
    
    
    (1,258
    )
    
    
    (250
    )Equity in income of real estate ventures
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,115
    
    
    
    754
    
    
    
    361Net loss on disposition of undepreciated assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (24
    )
    
    
    
    
    
    
    (24
    )Gain on early extinguishment of debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,356
    
    
    
    
    
    
    
    3,356Income (loss) before minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,209
    
    
    
    (7,910
    )
    
    
    15,119Minority interest  partners share of consolidated real estate ventures
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (40
    )
    
    
    (116
    )
    
    
    76Minority interest attributable to continuing operations  LP units
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (217
    )
    
    
    428
    
    
    
    (645
    )Income (loss) from continuing operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,952
    
    
    
    (7,598
    )
    
    
    14,550Income from discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,696
    
    
    
    26,970
    
    
    
    (19,274
    )Net Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    14,648
    
    
    $
    19,372
    
    
    $
    (4,724
    )Earnings per common share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    0.15
    
    
    $
    0.20
    
    
    $
    (0.05
    )
 
  (a)
    
    - Results include: seven developments and seven redevelopment properties.(b)
    
    - Represents certain revenues and expenses at the corporate level as well as various
intercompany costs that are eliminated in consolidation and third-party management fees. Also
included are revenues and
   expenses from the 29 DRA properties.
 65




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##### Table of Contents



Total Revenue
  1)
    
    An additional $2.5 million at the Same Store Portfolio from increased
occupancy, increased rents received on lease renewals and free rent periods converting
to cash rent subsequent to the first quarter of 2007. This free rent conversion is the
primary reason for the decrease in Total Portfolio straight-line rental income.2)
    
    An additional $5.5 million from six properties that we acquired and seven
development/redevelopment properties that we completed and placed in service subsequent
to the first quarter of 2007.3)
    
    The increase was offset by the decrease of $6.1 million of rental income earned
from our G&I properties in the first quarter of 2007.
   Property Operating Expenses
  Depreciation and Amortization Expense
   General & Administrative Expenses
  Interest Income/ Expense
   66




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##### Table of Contents



Gain on early extinguishment of debt
  Minority Interest attributable to continuing operations  LP units
  Discontinued Operations
   Net Income
  Earnings per Common Share
  67




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##### Table of Contents



General
  
    
    fund normal recurring expenses,
    
    fund capital expenditures, including capital and tenant improvements and leasing costs,
    
    fund current development and redevelopment costs, and
    
    fund distributions declared by our Board of Trustees.
       Cash Flows
  68




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##### Table of Contents



Activity
    
    2008
    
    
    2007Operating
    
    $
    74,168
    
    
    $
    50,521Investing
    
    
    (16,645
    )
    
    
    (30,542
    )Financing
    
    
    (59,271
    )
    
    
    (41,473
    )Net cash flows
    
    $
    (1,748
    )
    
    $
    (21,494
    )
    Capitalization
 Indebtedness
     69




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##### Table of Contents



March 31,
    
    
    December31,2008
    
    
    2007(dollars in thousands)Balance:Fixed rate (includes variable swapped to fixed)
    
    $
    2,856,408
    
    
    $
    2,855,332Variable rate  unhedged
    
    
    224,357
    
    
    
    245,637Total
    
    $
    3,080,765
    
    
    $
    3,100,969Percent of Total Debt:Fixed rate (includes variable swapped to fixed)
    
    
    92.7
    %
    
    
    92.1
    %Variable rate  unhedged
    
    
    7.3
    %
    
    
    7.9
    %Total
    
    
    100
    %
    
    
    100
    %Weighted-average interest rate at period end:Fixed rate (includes variable swapped to fixed)
    
    
    5.4
    %
    
    
    5.5
    %Variable rate  unhedged
    
    
    4.0
    %
    
    
    5.8
    %Total
    
    
    5.3
    %
    
    
    5.6
    %
       Equity
   70




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##### Table of Contents



Shelf Registration Statement
  Short- and Long-Term Liquidity
   Inflation
  Commitments and Contingencies
  71




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##### Table of Contents



Payments by Period (in thousands)Less than
    
    
    
    
    
    
    
    
    
    
    More thanTotal
    
    
    1 Year
    
    
    1-3 Years
    
    
    3-5 Years
    
    
    5 YearsMortgage notes payable (a)
    
    $
    599,344
    
    
    $
    22,635
    
    
    $
    239,406
    
    
    $
    230,238
    
    
    $
    107,065Revolving credit facility
    
    
    138,447
    
    
    
    3,447
    
    
    
    
    
    
    
    135,000
    
    
    
    Unsecured term loan
    
    
    150,000
    
    
    
    
    
    
    
    150,000
    
    
    
    
    
    
    
    Unsecured debt (a)
    
    
    2,187,110
    
    
    
    113,000
    
    
    
    575,000
    
    
    
    620,500
    
    
    
    878,610Ground leases (b)
    
    
    301,868
    
    
    
    1,736
    
    
    
    4,304
    
    
    
    4,636
    
    
    
    291,192Interest expense
    
    
    872,676
    
    
    
    158,650
    
    
    
    270,611
    
    
    
    223,692
    
    
    
    219,723Development contracts (c)
    
    
    18,568
    
    
    
    13,006
    
    
    
    5,562
    
    
    
    
    
    
    
    Other liabilities
    
    
    1,499
    
    
    
    
    
    
    
    811
    
    
    
    
    
    
    
    688$
    4,269,512
    
    
    $
    312,474
    
    
    $
    1,245,694
    
    
    $
    1,214,066
    
    
    $
    1,497,278
 
 (a)
    
    Amounts do not include unamortized discounts and/or premiums.(b)
    
    Future minimum rental payments under the terms of all non-cancelable ground leases under which
we are the lessee are expensed on a straight-line basis regardless of when payments are due.
Certain of the land leases provide for prepayment of rent on a present value basis using a fixed
discount rate. Further, certain of the land leases for properties (currently under development)
provide for contingent rent participation by the lessor in certain capital transactions and net
operating cash flows of the property after certain returns are achieved by us. Such amounts, if any
will be reflected as contingent rent when incurred. The leases also provide for payment by us of
certain operating costs relating to the land, primarily real estate taxes. The above schedule of
future minimum rental payments does not include any contingent rent amounts nor any reimbursed
expenses.(c)
    
    Represents contractual obligations for certain development projects and does not contemplate
all costs expected to be incurred for such developments    72




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##### Table of Contents



Interest Rate Risk and Sensitivity Analysis
       
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
   
 Item 4. Controls and Procedures
 (a)
    
    Evaluation of disclosure controls and procedures.Under the supervision and with the
participation of our management, including our principal executive officer and principal
financial officer, we conducted an evaluation of our disclosure controls and procedures, as
such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of
1934, as amended (the Exchange Act) as of the end of the period covered by this quarterly
report and have concluded that the Companys disclosure controls and procedures are
effective.
 73




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##### Table of Contents



(b)
    
    Changes in internal controls over financial reporting.There was no change in the
Companys internal control over financial reporting that occurred during the period covered
by this quarterly report that has materially affected, or is reasonably likely to
materially affect, the Companys internal control over financial reporting.
 
 Part II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  Total
    
    
    
    
    
    
    Purchased as
    
    
    Shares that MayNumber of
    
    
    Average
    
    
    Part of Publicly
    
    
    Yet Be PurchasedShares
    
    
    Price Paid Per
    
    
    Announced Plans
    
    
    Under the PlansPurchased
    
    
    Share
    
    
    or Programs
    
    
    or Programs (a)2008:January
    
    
    28,588
    (b)
    
    $
    17.93
    
    
    
    
    
    
    
    539,200February
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    539,200March
    
    
    7,439
    (b)
    
    $
    16.85
    
    
    
    
    
    
    
    539,200Total
    
    
    36,027
    
    
    
    
    
    
    
    
 
 (a)
    
    On May 2, 2006, our Board of Trustees authorized an increase in the number of common shares
that we may repurchase,
whether in open-market or privately negotiated transactions. The Board authorized us to purchase
up to an aggregate of 3,500,000
common shares (inclusive of the remaining share repurchase availability under the Boards prior
authorization from September 2001).
There is no expiration date on the share repurchase program.(b)
    
    Represents Common Shares cancelled by the Company upon vesting of restricted Common Shares
previously awarded to Company
employees in satisfaction of tax withholding. 
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. Exhibits
 (a) Exhibits
 10.1
    
    Employment letter agreement with Robert Wiberg (incorporated by reference to
Brandywines Current Report on Form 8-K filed on January 22, 2008)**
 74




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##### Table of Contents



10.2
    
    Form of Performance Share Award to President and Chief Executive Officer and
Executive Vice President and Chief Financial Officer (incorporated by reference to
Brandywines Current Report on Form 8-K filed on April 11, 2008)**10.3
    
    Form of Performance Award to Executives other than President and Chief Executive
Officer and Executive Vice President and Chief Financial Officer (incorporated by
reference to Brandywines Current Report on Form 8-K filed on April 11, 2008)**10.4
    
    Form of Incentive Share Option Agreement for President and Chief Executive
Officer and Executive Vice President and Chief Financial Officer (incorporated by
reference to Brandywines Current Report on Form 8-K filed on April 11, 2008)**10.5
    
    Form of Incentive Share Option Agreement to Executives other than President and
Chief Executive Officer and Executive Vice President and Chief Financial Officer
(incorporated by reference to Brandywines Current Report on Form 8-K filed on April 11,
2008)**10.6
    
    Form of Non-Qualified Share Option Agreement for President and Chief Executive
Officer and Executive Vice President and Chief Financial Officer (incorporated by
reference to Brandywines Current Report on Form 8-K filed on April 11, 2008)**10.7
    
    Form of Non-Qualified Share Option Agreement to Executives other than President
and Chief Executive Officer and Executive Vice President and Chief Financial Officer
(incorporated by reference to Brandywines Current Report on Form 8-K filed on April 11,
2008)**12.1
    
    Statement re Computation of Ratios of Brandywine Realty Trust
12.2 Statement re Computation of Ratios of Brandywine Operating Partnership, L.P.31.1
    
    Certification of the Chief Executive Officer of Brandywine Realty Trust pursuant
to 13a-14 under the Securities Exchange Act of 193431.2
    
    Certification of the Chief Financial Officer of Brandywine Realty Trust pursuant
to 13a-14 under the Securities Exchange Act of 193431.3
    
    Certification of the Chief Executive Officer of Brandywine Realty Trust, in its
capacity as the general partner of Brandywine Operating Partnership, L.P., pursuant to
13a-14 under the Securities Exchange Act of 193431.4
    
    Certification of the Chief Financial Officer of Brandywine Realty Trust, in its
capacity as the general partner of Brandywine Operating Partnership, L.P., pursuant to
13a-14 under the Securities Exchange Act of 193432.1
    
    Certification of the Chief Executive Officer of Brandywine Realty Trust pursuant
to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 200232.2
    
    Certification of the Chief Financial Officer of Brandywine Realty Trust pursuant
to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 200232.3
    
    Certification of the Chief Executive Officer of Brandywine Realty Trust, in its
capacity as the general partner of Brandywine Operating Partnership, L.P., pursuant to
18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
200232.4
    
    Certification of the Chief Financial Officer of Brandywine Realty Trust, in its
capacity as the general partner of Brandywine Operating Partnership, L.P., pursuant to
18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
 
 **
    
    Management contract or compensatory plan or arrangement 75




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##### Table of Contents



SIGNATURES OF REGISTRANT
    Date: May 9, 2008
    
    By:
    
    /s/ Gerard H. SweeneyGerard H. Sweeney, President and Chief Executive Officer
(Principal Executive Officer)Date: May 9, 2008
    
    By:
    
    /s/ Howard M. SipznerHoward M. Sipzner, Executive Vice President and Chief Financial Officer
(Principal Financial Officer)Date: May 9, 2008
    
    By:
    
    /s/ Darryl M. DunnDarryl M. Dunn, Vice President, Chief Accounting Officer & Treasurer
(Principal Accounting Officer)
 76




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##### Table of Contents



SIGNATURES OF REGISTRANT
    Date: May 9, 2008
    
    By:
    
    /s/ Gerard H. SweeneyGerard H. Sweeney, President and Chief Executive Officer
(Principal Executive Officer)Date: May 9, 2008
    
    By:
    
    /s/ Howard M. SipznerHoward M. Sipzner, Executive Vice President and Chief Financial Officer
(Principal Financial Officer)Date: May 9, 2008
    
    By:
    
    /s/ Darryl M. DunnDarryl M. Dunn, Vice President, Chief Accounting Officer & Treasurer
(Principal Accounting Officer)
 77