##### Table of Contents



UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
  Form 10-Q
   þ

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended
    September 30, 2007o

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to       Commission file number 1-13102
      First Industrial Realty Trust,
    Inc.
 (Exact Name of Registrant as
    Specified in its Charter)
   Maryland


36-3935116(State or Other Jurisdiction
    of
    Incorporation or Organization)


(I.R.S. Employer
    Identification No.
)    311 S. Wacker Drive, Suite 4000, Chicago,
    Illinois 60606
 (Address of Principal Executive
    Offices)
   (312) 344-4300
 Registrants Telephone
    Number, Including Area Code:
  þ o
  Rule 12b-2
  þ o o
  Rule 12b-2 o þ




---



##### 



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  Form 10-Q
  For the
    Period Ended September 30, 2007
  INDEX
  
  PagePART I: FINANCIAL INFORMATIONItem 1.


Financial Statements


3Consolidated Balance Sheets as of
    September 30, 2007 and December 31, 2006


3Consolidated Statements of Operations for the
    Three and Nine Months Ended September 30, 2007 and
    September 30, 2006


4Consolidated Statements of Comprehensive Income
    for the Three and Nine Months Ended September 30, 2007 and
    September 30, 2006


5Consolidated Statements of Cash Flows for the
    Nine Months Ended September 30, 2007 and September 30,
    2006


6Notes to Consolidated Financial Statements


7Item 2.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


19Item 3.


Quantitative and Qualitative Disclosures About
    Market Risk


31Item 4.


Controls and Procedures


31PART II: OTHER INFORMATIONItem 1.


Legal Proceedings


31Item 1A.


Risk Factors


31Item 2.


Unregistered Sales of Equity Securities and Use
    of Proceeds


32Item 3.


Defaults Upon Senior Securities


32Item 4.


Submission of Matters to a Vote of Security
    Holders


32Item 5.


Other Information


32Item 6.


Exhibits


32SIGNATURE


34EXHIBIT INDEX


35CertificationCertificationCertification   2




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##### Table of Contents



PART I.
    FINANCIAL INFORMATION
  Item 1.
    Financial
    Statements  FIRST
    INDUSTRIAL REALTY TRUST, INC.
  CONSOLIDATED
    BALANCE SHEETS
  September 30,


December 31,2007


2006(Unaudited)(Dollars in thousands, except share and per share data)ASSETSAssets:Investment in Real Estate:Land

$
647,942


$
558,425Buildings and Improvements


2,608,618



2,626,284Construction in Progress


78,671



35,019Less: Accumulated Depreciation


(506,025
)


(465,418
)Net Investment in Real Estate


2,829,206



2,754,310Real Estate Held for Sale, Net of Accumulated Depreciation and
    Amortization of $6,591 and $9,688 at September 30, 2007 and
    December 31, 2006, respectively


55,325



115,961Cash and Cash Equivalents


2,388



16,135Restricted Cash


3,985



15,970Tenant Accounts Receivable, Net


10,932



8,014Investments in Joint Ventures


61,003



55,527Deferred Rent Receivable, Net


31,955



28,839Deferred Financing Costs, Net


16,103



15,210Deferred Leasing Intangibles, Net


90,514



86,265Prepaid Expenses and Other Assets, Net


153,870



128,168Total Assets

$
3,255,281


$
3,224,399LIABILITIES AND STOCKHOLDERS EQUITYLiabilities:Mortgage Loans Payable, Net

$
80,300


$
77,926Senior Unsecured Debt, Net


1,550,563



1,549,732Unsecured Line of Credit


302,000



207,000Accounts Payable, Accrued Expenses and Other Liabilities, Net


130,641



119,027Deferred Leasing Intangibles, Net


20,723



19,486Rents Received in Advance and Security Deposits


30,094



30,844Leasing Intangibles Held For Sale, Net of Accumulated
    Amortization of $124 and $183 at September 30, 2007 and
    December 31, 2006, respectively


1,034



2,310Dividends Payable


42,415



42,548Total Liabilities


2,157,770



2,048,873Commitments and Contingencies






Minority Interest


149,969



152,547Stockholders Equity:Preferred Stock ($.01 par value, 10,000,000 shares
    authorized, 500, 250, 600 and 200 shares of Series F,
    G, J and K Cumulative Preferred Stock, respectively, issued and
    outstanding at September 30, 2007, having a liquidation
    preference of $100,000 per share ($50,000), $100,000 per share
    ($25,000), $250,000 per share ($150,000) and $250,000 per share
    ($50,000), respectively. At December 31, 2006,
    10,000,000 shares authorized, 20,000, 500, 250, 600 and
    200 shares of Series C, F, G, J and K Cumulative
    Preferred Stock, respectively, issued and outstanding, having a
    liquidation preference of $2,500 per share ($50,000), $100,000
    per share ($50,000), $100,000 per share ($25,000), $250,000 per
    share ($150,000) and $250,000 per share ($50,000), respectively)






Common Stock ($.01 par value, 100,000,000 shares
    authorized, 47,943,872 and 47,537,030 shares issued and
    44,673,958 and 45,010,630 shares outstanding at
    September 30, 2007 and December 31, 2006, respectively)


480



475Additional
    Paid-in-Capital


1,349,934



1,388,311Distributions in Excess of Accumulated Earnings


(293,577
)


(284,955
)Accumulated Other Comprehensive Loss


(9,301
)


(10,264
)Treasury Shares at Cost (3,269,914 shares at
    September 30, 2007 and 2,526,400 shares at
    December 31, 2006)


(99,994
)


(70,588
)Total Stockholders Equity


947,542



1,022,979Total Liabilities and Stockholders Equity

$
3,255,281


$
3,224,399    3




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  CONSOLIDATED
    STATEMENTS OF OPERATIONS
  Three Months


Three Months


Nine Months


Nine MonthsEnded


Ended


Ended


EndedSeptember 30,


September 30,


September 30,


September 30,2007


2006


2007


2006(Unaudited)(Dollars in thousands, except share and per share data)Revenues:Rental Income

$
73,701


$
62,650


$
216,686


$
182,060Tenant Recoveries and Other Income


29,835



25,332



92,455



75,911Revenues from Build to Suit Development for Sale










6,440



733Contractor Revenues


5,381







14,789



Total Revenues


108,917



87,982



330,370



258,704Expenses:Property Expenses


33,707



29,666



99,488



87,210General and Administrative


21,307



20,047



66,478



55,918Depreciation and Other Amortization


41,337



32,702



117,870



97,413Expenses from Build to Suit Development for Sale










6,131



666Contractor Expenses


5,188







14,147



Total Expenses


101,539



82,415



304,114



241,207Other Income/Expense:Interest Income


930



446



1,415



1,345Interest Expense


(30,196
)


(31,622
)


(89,764
)


(90,853
)Amortization of Deferred Financing Costs


(828
)


(603
)


(2,472
)


(1,826
)Mark-to-Market/Loss on Settlement of Interest Rate Protection
    Agreement






(2,942
)






(3,112
)Loss From Early Retirement of Debt


(139
)






(393
)


Total Other Income/Expense


(30,233
)


(34,721
)


(91,214
)


(94,446
)Loss from Continuing Operations Before Equity in Income of Joint
    Ventures, Income Tax Benefit and Income Allocated to Minority
    Interest


(22,855
)


(29,154
)


(64,958
)


(76,949
)Equity in Income of Joint Ventures


6,376



4,747



23,633



12,019Income Tax Benefit


2,839



4,381



4,955



11,286Minority Interest Allocable to Continuing Operations


2,319



3,291



6,924



9,073Loss from Continuing Operations


(11,321
)


(16,735
)


(29,446
)


(44,571
)Income from Discontinued Operations (Including Gain on Sale of
    Real Estate of $59,637 and $65,368 for the Three Months Ended
    September 30, 2007 and 2006, respectively, and $174,436 and
    $171,390 for the Nine Months Ended September 30, 2007 and
    2006, respectively)


62,430



72,520



186,047



189,298Provision for Income Taxes Allocable to Discontinued Operations
    (Including $9,894 and $19,662 for the Three Months Ended
    September 30, 2007 and 2006, respectively, and $31,015 and
    $42,171 for the Nine Months Ended September 30, 2007 and
    2006, respectively, allocable to Gain on Sale of Real Estate)


(10,473
)


(21,261
)


(33,585
)


(44,811
)Minority Interest Allocable to Discontinued Operations


(6,531
)


(6,659
)


(19,195
)


(18,870
)Income Before Gain on Sale of Real Estate


34,105



27,865



103,821



81,046Gain on Sale of Real Estate


103



2,853



4,507



6,374Provision for Income Taxes Allocable to Gain on Sale of Real
    Estate


(40
)


(1,122
)


(1,145
)


(2,174
)Minority Interest Allocable to Gain on Sale of Sale Estate


(8
)


(225
)


(423
)


(549
)Net Income


34,160



29,371



106,760



84,697Less: Preferred Stock Dividends


(4,857
)


(5,442
)


(16,463
)


(15,490
)Less: Redemption of Preferred Stock










(2,017
)


(672
)Net Income Available to Common Stockholders

$
29,303


$
23,929


$
88,280


$
68,535Basic and Diluted Earnings Per Share:Loss from Continuing Operations

$
(0.36
)

$
(0.47
)

$
(1.01
)

$
(1.30
)Income From Discontinued Operations

$
1.03


$
1.01


$
3.00


$
2.86Net Income Available to Common Stockholders

$
0.66


$
0.54


$
1.99


$
1.56Weighted Average Shares Outstanding


44,240



44,032



44,373



43,976Dividends/Distribution Declared per Common Share Outstanding

$
0.71


$
0.70


$
2.13


$
2.10    4




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  CONSOLIDATED
    STATEMENTS OF COMPREHENSIVE INCOME
  Three Months


Three Months


Nine Months


Nine MonthsEnded


Ended


Ended


EndedSeptember 30,


September 30,


September 30,


September 30,2007


2006


2007


2006(Unaudited)(Dollars in thousands)Net Income

$
34,160


$
29,371


$
106,760


$
84,697Settlement of Interest Rate Protection Agreements










(4,261
)


(1,729
)Mark to Market of Interest Rate Protection Agreements


(329
)


(7,702
)


3,886



(2,913
)Amortization of Interest Rate Protection Agreements


(189
)


(218
)


(728
)


(668
)Foreign Currency Translation Adjustment, Net of Tax Provision


2,261







2,261



Other Comprehensive (Income) Loss Allocable to Minority Interest


(220
)


1,029



(195
)


692Comprehensive Income

$
35,683


$
22,480


$
107,723


$
80,079    5




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
  Nine Months


Nine MonthsEnded


EndedSeptember 30,


September 30,2007


2006(Unaudited)(Dollars in thousands)CASH FLOWS FROM OPERATING ACTIVITIES:Net Income

$
106,760


$
84,697Adjustments to Reconcile Net Income to Net Cash Provided by
    Operating Activities:Allocation of Income to Minority Interest


12,694



10,346Depreciation


91,507



90,511Amortization of Deferred Financing Costs


2,472



1,826Other Amortization


40,631



28,002Provision for Bad Debt


2,801



1,912Mark-to-Market of Interest Rate Protection Agreement






(16
)Equity in Income of Joint Ventures


(23,633
)


(12,019
)Distributions from Joint Ventures


25,078



12,803Gain on Sale of Real Estate


(178,943
)


(177,764
)Loss on Early Retirement of Debt


393



Decrease in Developments and Build to Suit for Sale Costs


4,106



16,241Decrease in Tenant Accounts Receivable and Prepaid Expenses
    and Other Assets, Net


(9,510
)


(14,940
)Increase in Deferred Rent Receivable


(7,975
)


(7,857
)Increase in Accounts Payable and Accrued Expenses and Rents
    Received in Advance and Security Deposits


13,181



16,070Decrease in Restricted Cash


(334
)


Net Cash Provided by Operating Activities


79,228



49,812CASH FLOWS FROM INVESTING ACTIVITIES:Purchases of and Additions to Investment in Real Estate


(545,904
)


(651,333
)Net Proceeds from Sales of Investments in Real Estate


587,778



725,038Contributions to and Investments in Joint Ventures


(23,804
)


(24,425
)Distributions from Joint Ventures


15,673



10,877Funding of Notes Receivable


(8,385
)


Repayment of Notes Receivable


23,935



34,987Decrease in Restricted Cash


12,337



7,665Net Cash Provided By Investing Activities


61,630



102,809CASH FLOWS FROM FINANCING ACTIVITIES:Net Proceeds from the Issuance of Common Stock


567



1,542Proceeds from the Issuance of Preferred Stock






192,897Redemption of Preferred Stock


(50,014
)


(182,156
)Repurchase of Restricted Stock


(3,922
)


(2,660
)Dividends/Distributions


(110,334
)


(107,804
)Preferred Stock Dividends


(16,310
)


(12,574
)Purchase of Treasury Shares


(29,406
)


Repayments on Mortgage Loans Payable


(34,904
)


(11,973
)Debt Issuance Costs and Costs Incurred in Connection with the
    Early Retirement of Debt


(3,758
)


(5,449
)Net Proceeds from Senior Unsecured Debt


149,595



374,306Repayments of Senior Unsecured Debt


(150,000
)


Other Costs of Senior Unsecured Debt


(4,261
)


(7,539
)Proceeds from Unsecured Line of Credit


677,000



488,500Repayments on Unsecured Line of Credit


(582,000
)


(882,000
)Cash Book Overdraft.


3,142



3,765Net Cash Used in Financing Activities


(154,605
)


(151,145
)Net (Decrease) Increase in Cash and Cash Equivalents


(13,747
)


1,476Cash and Cash Equivalents, Beginning of Period


16,135



8,237Cash and Cash Equivalents, End of Period

$
2,388


$
9,713    6




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    (Dollars in thousands, except per share data)
    (Unaudited)
  1.
    Organization
    and Formation of Company        2.
    Summary
    of Significant Accounting Policies  Form 10-K
     7




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Deferred
    Leasing Intangibles
    September 30,


December 31,2007


2006In-Place Leases

$
88,661


$
81,422Less: Accumulated Amortization


(22,240
)


(15,361
)$
66,421


$
66,061Above Market Leases

$
6,282


$
6,933Less: Accumulated Amortization


(2,271
)


(2,177
)$
4,011


$
4,756Tenant Relationships

$
22,861


$
16,657Less: Accumulated Amortization


(2,779
)


(1,209
)$
20,082


$
15,448     September 30,


December 31,2007


2006Below Market Leases

$
29,216


$
25,735Less: Accumulated Amortization


(8,493
)


(6,249
)$
20,723


$
19,486       Build
    to Suit Development for Sale and General Contractor Revenues and
    Expenses
     8




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Foreign
    Currency Transactions and Translation
    Recent
    Accounting Pronouncements
  Accounting for Uncertainty in Income Taxes ,
  Fair Value Measurements
  The Fair Value Option for Financial Assets and
    Financial Liabilities
  3.
    Investments
    in Joint Ventures and Management Services   9




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
              Nine Months


Nine MonthsEnded


EndedSeptember 30,


September 30,2007


2006Contributions

$
21,936


$
21,477Distributions

$
40,751


$
23,680Fees

$
20,569


$
16,242  10




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  4.
    Mortgage
    Loans Payable, Net, Senior Unsecured Debt, Net and Unsecured
    Line of Credit    EffectiveOutstanding


Interest

InterestBalance at


Rate at

Rate atSeptember 30,


December 31,


September 30,

Issuance/2007


2006


2007

Assumption

Maturity DateMortgage Loans Payable, Net

$
80,300


$
77,926


5.35%-9.25%

4.58%-9.25%

December 2007-
    September 2024Unamortized Premiums


(2,377
)


(2,919
)Mortgage Loans Payable, Gross

$
77,923


$
75,007Senior Unsecured Notes, Net2007 Notes

$



$
149,998


N/A

N/A

05/15/072016 Notes


199,425



199,372


5.750%

5.91%

01/15/162017 Notes


99,902



99,895


7.500%

7.52%

12/01/172027 Notes


15,056



15,055


7.150%

7.11%

05/15/272028 Notes


199,836



199,831


7.600%

8.13%

07/15/282011 Notes


199,792



199,746


7.375%

7.39%

03/15/112012 Notes


199,373



199,270


6.875%

6.85%

04/15/122032 Notes


49,452



49,435


7.750%

7.87%

04/15/322009 Notes


124,926



124,893


5.250%

4.10%

06/15/092014 Notes


113,191



112,237


6.420%

6.54%

06/01/142011 Exchangeable Notes


200,000



200,000


4.625%

4.63%

09/15/112017 II Notes


149,610






5.950%

6.37%

05/15/17Subtotal

$
1,550,563


$
1,549,732Unamortized Discounts


14,507



15,338Senior Unsecured Notes, Gross

$
1,565,070


$
1,565,070Unsecured Line of Credit

$
302,000


$
207,000


7.858%

7.858%

09/28/12      11




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          AmountRemainder of 2007

$
6,5692008


3,1112009


132,9592010


15,4532011


407,269Thereafter


1,379,632Total

$
1,944,993   Other
    Comprehensive Income:
   12




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        5.
    Stockholders
    Equity  Preferred
    Stock
  5 8
  Shares
    of Common Stock
    Treasury
    Stock
    Non-Qualified
    Employee Stock Options:
   13




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Restricted
    Stock:
    Dividend/Distributions:
    Nine Months EndedSeptember 30, 2007Dividend/


TotalDistribution


Dividend/per Share/Unit


DistributionCommon Stock/Operating Partnership Units

$
2.13


$
110,047Series C Preferred Stock

$
94.64


$
1,893Series F Preferred Stock

$
4,677.00


$
2,339Series G Preferred Stock

$
5,427.00


$
1,357Series J Preferred Stock

$
13,593.90


$
8,155Series K Preferred Stock

$
13,593.90


$
2,719   6.
    Acquisition
    of Real Estate    7.
    Sale of
    Real Estate, Real Estate Held for Sale and Discontinued
    Operations  Accounting for the Impairment or Disposal
    of Long-Lived Assets
   14




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Three Months


Three Months


Nine Months


Nine MonthsEnded


Ended


Ended


EndedSeptember 30, 2007


September 30, 2006


September 30, 2007


September 30, 2006Total Revenues

$
6,139


$
19,170


$
28,782


$
55,573Property Expenses


(2,107
)


(5,314
)


(9,388
)


(17,431
)Depreciation and Amortization


(1,239
)


(6,704
)


(7,783
)


(20,234
)Provision for Income Taxes Allocable to Operations


(579
)


(1,599
)


(2,570
)


(2,640
)Gain on Sale of Real Estate


59,637



65,368



174,436



171,390Provision for Income Taxes Allocable to Gain on Sale of Real
    Estate


(9,894
)


(19,662
)


(31,015
)


(42,171
)Income from Discontinued Operations Before Minority Interest

$
51,957


$
51,259


$
152,462


$
144,487    15




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  8.
    Supplemental
    Information to Statements of Cash Flows    Nine Months


Nine MonthsEnded


EndedSeptember 30, 2007


September 30, 2006Interest paid, net of capitalized interest

$
91,166


$
80,693Capitalized interest

$
5,846


$
4,225Supplemental schedule of noncash investing and financing
    activities:Distribution payable on common stock/Units

$
36,326


$
36,053Distribution payable on preferred stock

$
6,089


$
6,674Exchange of units for common stock:Minority interest

$
(1,594
)

$
(2,041
)Common Stock


1



1Additional
    paid-in-capital


1,593



2,040$



$
In conjunction with the property and land acquisitions, the
    following assets and liabilities were assumed:Accounts payable and accrued expenses

$
(5,873
)

$
(1,795
)Issuance of Operating Partnership Units

$



$
(1,288
)Mortgage Debt

$
(38,590
)

$
(7,765
)Write-off of fully depreciated assets

$
29,873


$
20,977In conjunction with certain property sales, the Company provided
    seller financing or assigned a mortgage loan payable:Notes Receivable

$
42,172


$
11,200Mortgage Note Payable

$
769


$
  16




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  9.
    Earnings
    Per Share (EPS)    Three Months


Three Months


Nine Months


Nine MonthsEnded


Ended


Ended


EndedSeptember 30,


September 30,


September 30,


September 30,2007


2006


2007


2006Numerator:Loss from Continuing Operations

$
(11,321
)

$
(16,735
)

$
(29,446
)

$
(44,571
)Gain on Sale of Real Estate, Net of Minority Interest and Income
    Taxes


55



1,506



2,939



3,651Less: Preferred Stock Dividends


(4,857
)


(5,442
)


(16,463
)


(15,490
)Less: Redemption of Preferred Stock










(2,017
)


(672
)Loss from Continuing Operations Available to Common
    Stockholders, Net of Minority Interest and Income
    Taxes  For Basic and Diluted EPS


(16,123
)


(20,671
)


(44,987
)


(57,082
)Discontinued Operations, Net of Minority Interest and Income
    Taxes


45,426



44,600



133,267



125,617Net Income Available to Common Stockholders  For
    Basic and Diluted EPS

$
29,303


$
23,929


$
88,280


$
68,535Denominator:Weighted Average Shares  Basic and Diluted


44,240,206



44,031,936



44,373,126



43,975,588Basic and Diluted EPS:Loss from Continuing Operations Available to Common
    Stockholders, Net of Minority Interest and Income Taxes

$
(0.36
)

$
(0.47
)

$
(1.01
)

$
(1.30
)Discontinued Operations, Net of Minority Interest and Income
    Taxes

$
1.03


$
1.01


$
3.00


$
2.86Net Income Available to Common Stockholders

$
0.66


$
0.54


$
1.99


$
1.56          17




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##### Table of Contents



FIRST
    INDUSTRIAL REALTY TRUST, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    10.
    Stock
    Based Compensation      WeightedAverage


Exercise


AggregateExercise


Price


IntrinsicShares


Price


per Share


ValueOutstanding at December 31, 2006


381,976


$
31.65


$
25.13-$33.15


$
5,823Exercised


(19,600
)

$
31.27


$
30.38-$33.13


$
230Outstanding at September 30, 2007


362,376


$
31.67


$
25.13-$33.15


$
4,187     Number

Weighted

WeightedOutstanding

Average

Averageand

Remaining

ExerciseRange of Exercise Price

Exercisable

Contractual Life

Price$25.13-$30.53


103,676



3.57


$
29.82$31.05-$33.15


258,700



2.68


$
32.40   11.
    Commitments
    and Contingencies        12.
    Subsequent
    Events    dividend/distribution
 18




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##### Table of Contents



Item 2.  Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations
  Form 10-Q.
  lease-up
  GENERAL
       19




---



##### Table of Contents



MANAGEMENTS
    OVERVIEW
      and/or
   20




---



##### Table of Contents



RESULTS
    OF OPERATIONS
  Comparison
    of Nine Months Ended September 30, 2007 to Nine Months
    Ended September 30, 2006
     21




---



##### Table of Contents



Nine Months


Nine MonthsEnded


EndedSeptember 30, 2007


September 30, 2006


$ Change


% Change($ in 000s)REVENUESSame Store Properties

$
237,744


$
225,596


$
12,148



5.4
%Acquired Properties


41,495



9,982



31,513



315.7
%Sold Properties


23,474



51,559



(28,085
)


(54.5
)%(Re)Developments and Land, Not Included Above


5,389



4,312



1,077



25.0
%Other


29,821



22,095



7,726



35.0
%$
337,923


$
313,544


$
24,379



7.8
%Discontinued Operations


(28,782
)


(55,573
)


26,791



(48.2
)%Subtotal Revenues

$
309,141


$
257,971


$
51,170



19.8
%Revenues from Build to Suit Developments for Sale


6,440



733



5,707



778.6
%Contractor Revenues


14,789







14,789



Total Revenues

$
330,370


$
258,704


$
71,666



27.7
%     22




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##### Table of Contents



Nine Months


Nine MonthsEnded


EndedSeptember 30, 2007


September 30, 2006


$ Change


% Change($ in 000s)PROPERTY EXPENSESSame Store Properties

$
75,688


$
72,635


$
3,053



4.2
%Acquired Properties


9,903



2,286



7,617



333.2
%Sold Properties


7,416



15,055



(7,639
)


(50.7
)%(Re) Developments and Land, Not Included Above


3,044



3,003



41



1.4
%Other


12,825



11,662



1,163



10.0
%$
108,876


$
104,641


$
4,235



4.0
%Discontinued Operations


(9,388
)


(17,431
)


8,043



(46.1
)%Subtotal Property Expenses

$
99,488


$
87,210


$
12,278



14.1
%Expenses from Build to Suit Development for Sale


6,131



666



5,465



820.6
%Contractor Expenses


14,147







14,147



Total Property Expenses

$
119,766


$
87,876


$
31,890



36.3
%       Nine Months


Nine MonthsEnded


EndedSeptember 30, 2007


September 30, 2006


$ Change


% Change($ in 000s)DEPRECIATION AND OTHER AMORTIZATIONSame Store Properties

$
85,737


$
83,970


$
1,767



2.1
%Acquired Properties


29,654



8,429



21,225



251.8
%Sold Properties


6,126



17,037



(10,911
)


(64.0
)%(Re) Developments and Land, Not Included Above


2,735



6,870



(4,135
)


(60.2
)%Corporate Furniture, Fixtures and Equipment


1,401



1,341



60



4.5
%$
125,653


$
117,647


$
8,006



6.8
%Discontinued Operations


(7,783
)


(20,234
)


12,451



(61.5
)%Total Depreciation and Other Amortization

$
117,870


$
97,413


$
20,457



21.0
%  23




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##### Table of Contents



Accounting for Derivative Instruments and
    Hedging Activities
         24




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##### Table of Contents



Nine Months


Nine MonthsEnded


EndedSeptember 30, 2007


September 30, 2006($ in 000s)Total Revenues

$
28,782


$
55,573Property Expenses


(9,388
)


(17,431
)Depreciation and Amortization


(7,783
)


(20,234
)Provision for Income Taxes Allocable to Operations


(2,570
)


(2,640
)Gain on Sale of Real Estate


174,436



171,390Provision for Income Taxes Allocable to Gain on Sale of Real
    Estate


(31,015
)


(42,171
)Income from Discontinued Operations

$
152,462


$
144,487       Comparison
    of Three Months Ended September 30, 2007 to Three Months
    Ended September 30, 2006
     25




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##### Table of Contents



Three Months


Three MonthsEnded


EndedSeptember 30, 2007


September 30, 2006


$ Change


% Change($ in 000s)REVENUESSame Store Properties

$
79,681


$
75,769


$
3,912



5.2
%Acquired Properties


14,848



5,538



9,310



168.1
%Sold Properties


4,258



17,326



(13,068
)


(75.4
)%(Re)Developments and Land, Not Included Above


2,058



1,481



577



39.0
%Other


8,830



7,038



1,792



25.5
%109,675



107,152



2,523



2.4
%Discontinued Operations


(6,139
)


(19,170
)


13,031



(68.0
)%Subtotal Revenues


103,536



87,982



15,554



17.7
%Contractor Revenues


5,381







5,381



Total Revenues

$
108,917


$
87,982


$
20,935



23.8
%     Three Months


Three MonthsEnded


EndedSeptember 30, 2007


September 30, 2006


$ Change


% Change($ in 000s)PROPERTY EXPENSESSame Store Properties

$
25,508


$
24,297


$
1,211



5.0
%Acquired Properties


3,964



1,264



2,700



213.6
%Sold Properties


1,571



4,720



(3,149
)


(66.7
)%(Re)Developments and Land, Not Included Above


874



605



269



44.5
%Other


3,897



4,094



(197
)


(4.8
)%35,814



34,980



834



2.4
%Discontinued Operations


(2,107
)


(5,314
)


3,207



(60.4
)%Subtotal Property Expenses


33,707



29,666



4,041



13.6
%Contractor Expenses


5,188







5,188



Total Property Expenses

$
38,895


$
29,666


$
9,229



31.1
%  26




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##### Table of Contents



Three Months


Three MonthsEnded


EndedSeptember 30, 2007


September 30, 2006


$ Change


% Change($ in 000s)DEPRECIATION AND OTHER AMORTIZATIONSame Store Properties

$
28,675


$
27,904


$
771



2.8
%Acquired Properties


11,729



4,474



7,255



162.2
%Sold Properties


679



5,637



(4,958
)


(88.0
)%(Re)Developments and Land, Not Included Above


1,054



914



140



15.3
%Corporate Furniture, Fixtures and Equipment


439



477



(38
)


(8.0
)%42,576



39,406



3,170



8.0
%Discontinued Operations


(1,239
)


(6,704
)


5,465



(81.5
)%Total Depreciation and Other Amortization

$
41,337


$
32,702


$
8,635



26.4
%            27




---



##### Table of Contents



Three Months


Three MonthsEnded


EndedSeptember 30, 2007


September 30, 2006($ in 000s)Total Revenues

$
6,139


$
19,170Property Expenses


(2,107
)


(5,314
)Depreciation and Amortization


(1,239
)


(6,704
)Provision for Income Taxes Allocable to Operations


(579
)


(1,599
)Gain on Sale of Real Estate


59,637



65,368Provision for Income Taxes Allocable to Gain on Sale of Real
    Estate


(9,894
)


(19,662
)Income from Discontinued Operations Before Minority Interest

$
51,957


$
51,259       LIQUIDITY
    AND CAPITAL RESOURCES
   28




---



##### Table of Contents



Nine
    Months Ended September 30, 2007
         29




---



##### Table of Contents



non-qualified
  Market
    Risk
                Recent
    Accounting Pronouncements
   30




---



##### Table of Contents



Subsequent
    Events
    dividend/distribution
  Other
    Item 3.
    Quantitative
    and Qualitative Disclosures About Market Risk    Item 4.
    Controls
    and Procedures  Rules 13a-15(e) 15d-15(e)) Rules 13a-15(b) 15d-15(b),
    PART II.
    OTHER INFORMATION
  Item 1.
    Legal
    Proceedings    Item 1A.
    Risk
    Factors   31




---



##### Table of Contents



Item 2.
    Unregistered
    Sales of Equity Securities and Use of Proceeds    Total Number


Approximateof Shares


Dollar Value ofPurchased as


Shares that MayTotal





Part of Publicly


Yet beNumber of


Average


Announced


PurchasedShares


Price Paid


Plans or


Under the PlansPeriod

Purchased


per Share


Programs


or Programs(1)July 1, 2007  July 31, 2007













$
29,513,176August 1, 2007  August 31, 2007


645,083


$
39.46



645,083


$
4,060,637September 1, 2007  September 30, 2007


98,431


$
39.90



98,431


$
100,132,878Total


743,514


$
39.52



743,514


$
100,132,878     (1)
    
    In March 2000, the Companys Board of Directors authorized
    a stock repurchase plan pursuant to which the Company was
    permitted to purchase up to $100 million of the Companys
    outstanding common stock. The Company completed its previous
    common stock repurchase program by buying 743,514 shares of its
    common stock during the nine months ended September 30, 2007 at
    an average price per share, excluding commissions paid, of
    $39.52. In September 2007, the Companys Board of
    Directors authorized a new $100 million common stock repurchase
    program. The Company may make purchases from time to time in the
    open market or in privately negotiated transactions, depending
    on market and business conditions.  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:  ExhibitNumber

Description10
.1***

Letter Agreement between Robert Cutlip and the Company dated as
    of September 10, 2007 (incorporated by reference to
    Exhibit 10.1 of the
    Form 8-K
    of the Company filed September 12, 2007, File
    No. 1-13102).10
.2***

Fifth Amended and Restated Unsecured Revolving Credit Agreement
    dated as of September 28, 2007 among the Operating
    Partnership, the Company, JP Morgan Chase Bank, N.A. and the
    other lenders thereunder (incorporated by reference to
    Exhibit 10.1 of the
    Form 8-K
    of the Company filed October 1, 2007, File
    No. 1-13102).31
.1*

Certification of the Principal Executive Officer pursuant to
    Rule 13a-14(a)
    under the Securities Exchange Act of 1934, as amended.31
.2*

Certification of the Principal Financial Officer pursuant to
    Rule 13a-14(a)
    under the Securities Exchange Act of 1934, as amended.32
.1**

Certification of the Principal Executive Officer and the
    Principal Financial Officer pursuant to 18 U.S.C.
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002.     *
    
    Filed herewith**
    
    Furnished herewith***
    
    Previously filed 32




---



##### Table of Contents



Form 10-Q. Form 10-K, Form 10-Q, Form 8-K,
  
 33




---



##### Table of Contents



SIGNATURE
      By:
    /s/  Scott
    A. Musil       34




---



##### Table of Contents



EXHIBIT INDEX
  ExhibitNumber

Description10
.1***

Letter Agreement between Robert Cutlip and the Company dated as
    of September 10, 2007 (incorporated by reference to
    Exhibit 10.1 of the
    Form 8-K
    of the Company filed September 12, 2007, File
    No. 1-13102).10
.2***

Fifth Amended and Restated Unsecured Revolving Credit Agreement
    dated as of September 28, 2007 among the Operating
    Partnership, the Company, JP Morgan Chase Bank, N.A. and the
    other lenders thereunder (incorporated by reference to
    Exhibit 10.1 of the
    Form 8-K
    of the Company filed October 1, 2007, File
    No. 1-13102).31
.1*

Certification of the Principal Executive Officer pursuant to
    Rule 13a-14(a)
    under the Securities Exchange Act of 1934, as amended.31
.2*

Certification of the Principal Financial Officer pursuant to
    Rule 13a-14(a)
    under the Securities Exchange Act of 1934, as amended.32
.1**

Certification of the Principal Executive Officer and the
    Principal Financial Officer pursuant to 18 U.S.C.
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002.     *
    
    Filed herewith**
    
    Furnished herewith***
    
    Previously filed 35