<PAGE>

                      SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-Q

              Quarterly Report Pursuant to Section 13 or 15(d) of
                      the Securities Exchange Act of 1934


For the Quarter Ended: June 30, 2000      Commission File Number: 1-13829
                       -------------                              -------

                             CABOT INDUSTRIAL TRUST
                             ----------------------
             (Exact name of registrant as specified in its charter)

               Maryland                            04-3397866
               --------                            ----------
(State or other jurisdiction of         (I.R.S. Employer Identification Number)
incorporation or organization)



            Two Center Plaza, Suite 200, Boston, Massachusetts 02108
            --------------------------------------------------------
          (Address of principal executive offices, including zip code)


                                (617) 723-0900
                                --------------
             (Registrant's telephone number, including area code)



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                       YES        X            NO
                               --------            -------

Indicate the number of shares outstanding of each of the registrant's classes of
Common Stock, as of the latest practicable date: As of August 11, 2000,
40,624,833 Common Shares of Beneficial Interest, $.01 par value, of the
Registrant were outstanding.
<PAGE>

                         PART I.  FINANCIAL INFORMATION


ITEM 1.         CONSOLIDATED FINANCIAL STATEMENTS


The accompanying unaudited consolidated condensed financial statements should be
read in conjunction with the 1999 Form 10-K of the registrant ("Cabot Trust").
These consolidated condensed statements have been prepared in accordance with
the instructions of the Securities and Exchange Commission for Form 10-Q and do
not include all the information and footnotes required by generally accepted
accounting principles for complete financial statements.

In the opinion of Cabot Trust's management, all material adjustments (consisting
solely of items of a normal, recurring nature) considered necessary for a fair
presentation of results of operations for the interim period have been included.
The results of consolidated operations for the period from January 1, 2000
through June 30, 2000 are not necessarily indicative of the results that may be
expected for the period from January 1, 2000 through December 31, 2000.

                                       2
<PAGE>

                            CABOT INDUSTRIAL TRUST

                     CONSOLIDATED CONDENSED BALANCE SHEET
                   As of June 30, 2000 and December 31, 1999
                       (in thousands, except share data)

<TABLE>
<CAPTION>
                                                               June 30, 2000      December 31, 1999
                                                             -----------------    -----------------
                                                                 (unaudited)
<S>                                                            <C>                <C>
ASSETS:

INVESTMENT IN REAL ESTATE:
Rental Properties                                                  $ 1,661,447          $ 1,507,834
Less:  Accumulated Depreciation                                        (59,305)             (42,543)
                                                             -----------------     ----------------
     Net Rental Properties                                           1,602,142            1,465,291
Properties under Development                                            62,174               63,938
                                                             -----------------     ----------------
                                                                   $ 1,664,316          $ 1,529,229
                                                             -----------------     ----------------

OTHER ASSETS:
Cash and Cash Equivalents                                          $     3,018          $    22,007
Rents and Other Receivables, net of allowance for
  uncollectible accounts of $763 and $574 at June 30, 2000
  and December 31, 1999, respectively                                    3,398                3,828
Deferred Rent Receivable                                                 8,717                6,079
Deferred Lease Acquisition Costs, net                                   30,019               23,913
Deferred Financing Costs, net                                            3,460                3,369
Investment in and Advances to Cabot Advisors                               308                1,105
Investment In and Notes Receivable from Joint Venture                    7,541                   --
Other Assets                                                             7,149                3,954
                                                             -----------------     ----------------

TOTAL ASSETS                                                       $ 1,727,926          $ 1,593,484
                                                             =================     ================

LIABILITIES AND SHAREHOLDERS' EQUITY:

LIABILITIES:
Mortgage Debt                                                      $   234,878          $   163,866
Unsecured Debt                                                         200,000              200,000
Line of Credit Borrowings                                              183,000              163,000
Accounts Payable                                                           978                  889
Accrued Real Estate Taxes                                               11,483               10,254
Distributions Payable                                                   16,155               15,437
Tenant Security Deposits and Prepaid Rents                               8,739               11,205
Other Liabilities                                                       19,002               20,117
                                                             -----------------     ----------------
                                                                   $   674,235          $   584,768
                                                             -----------------     ----------------

MINORITY INTEREST:
Preferred Unitholders                                              $   238,205          $   189,805
Limited Partner Unitholders                                             56,931               57,169
                                                             -----------------     ----------------
                                                                   $   295,136          $   246,974
                                                             -----------------     ----------------

SHAREHOLDERS' EQUITY:
Common Shares, $0.01 par value, 150,000,000 shares authorized,
     40,619,833 and 40,619,420 shares issued and outstanding at
     June 30, 2000 and December 31, 1999, respectively             $       406          $       406
Paid in Capital                                                        767,694              767,774
Retained Deficit                                                        (9,545)              (6,438)
                                                             -----------------     ----------------

TOTAL SHAREHOLDERS' EQUITY                                         $   758,555          $   761,742
                                                             -----------------     ----------------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                         $ 1,727,926          $ 1,593,484
                                                             =================     ================
</TABLE>


                                       3
<PAGE>

                            CABOT INDUSTRIAL TRUST

                CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
          For the Three Months ended June 30, 2000 and June 30, 1999
               (unaudited, in thousands, except per share data)

<TABLE>
<CAPTION>
                                                   Three Months Ended                   Three Months Ended
                                                     June 30, 2000                        June 30, 1999
                                                -------------------------------     ------------------------
<S>                                             <C>                                 <C>
REVENUES:
Rental Income                                                $   44,994                           $   32,004
Tenant Reimbursements                                             7,184                                5,178
                                                  ---------------------                        -------------
                Total Revenues                               $   52,178                           $   37,182
                                                  ---------------------                        -------------

EXPENSES:
Property Operating                                           $    4,705                           $    2,749
Property Taxes                                                    6,022                                4,125
Depreciation and Amortization                                    10,468                                7,353
Interest                                                         10,560                                5,822
General and Administrative                                        2,216                                2,136
                                                  ---------------------                        -------------

                Total Expenses                               $   33,971                           $   22,185
                                                  ---------------------                        -------------

Interest and Other Income                                    $      471                           $      304
Earnings and Fees from Joint Venture                                198                                    -
Gain on Sale of Real Estate                                           -                                3,404
                                                  ---------------------                        -------------
                                                             $      669                           $    3,708
                                                  ---------------------                        -------------

Income Before Minority Interest Expense                      $   18,876                           $   18,705

MINORITY INTEREST EXPENSE:
     Preferred Unitholders                                       (4,905)                                (981)
     Limited Partner Unitholders                                   (975)                              (2,563)
                                                  ---------------------                        -------------

Net Income                                                   $   12,996                           $   15,161
                                                  =====================                        =============

Earnings per Common Share:
    Basic                                                    $     0.32                           $     0.41
                                                  =====================                        =============
    Diluted                                                  $     0.32                           $     0.41
                                                  =====================                        =============

Weighted Average Common Shares:
    Basic                                                        40,619                               37,324
                                                  =====================                        =============
    Diluted                                                      40,619                               37,324
                                                  =====================                        =============
</TABLE>

                                       4
<PAGE>

                            CABOT INDUSTRIAL TRUST

                CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
           For the Six Months ended June 30, 2000 and June 30, 1999
               (unaudited, in thousands, except per share data)

<TABLE>
<CAPTION>

                                                                        Six Months Ended             Six Months Ended
                                                                         June 30, 2000                June 30, 1999
                                                                 ----------------------------     -------------------

REVENUES:
<S>                                                                <C>                              <C>
Rental Income                                                              $   87,743                      $   61,225
Tenant Reimbursements                                                          14,243                          10,095
                                                                        -------------                    ------------
                Total Revenues                                             $  101,986                      $   71,320
                                                                        -------------                    ------------

EXPENSES:
Property Operating                                                         $    9,251                      $    5,429
Property Taxes                                                                 11,920                           7,970
Depreciation and Amortization                                                  20,291                          14,163
Interest                                                                       20,010                          10,137
General and Administrative                                                      4,697                           4,321
Settlement of Treasury Lock                                                         -                           2,492
                                                                        -------------                    ------------

                Total Expenses                                             $   66,169                      $   44,512
                                                                        -------------                    ------------

Interest and Other Income                                                  $      765                      $      506
Earnings and Fees from Joint Venture                                              198                               -
Gain on Sale of Real Estate                                                         -                           3,404
                                                                        -------------                    ------------
                                                                           $      963                      $    3,910
                                                                        -------------                    ------------

Income Before Minority Interest Expense                                    $   36,780                      $   30,718

MINORITY INTEREST EXPENSE:
     Preferred Unitholders                                                     (9,116)                           (981)
     Limited Partner Unitholders                                               (1,931)                         (6,885)
                                                                        -------------                    ------------

Net Income                                                                 $   25,733                      $   22,852
                                                                        =============                    ============
Earnings per Common Share:
    Basic                                                                  $     0.63                      $     0.68
                                                                        =============                    ============
    Diluted                                                                $     0.63                      $     0.68
                                                                        =============                    ============
Weighted Average Common Shares:
    Basic                                                                      40,619                          33,489
                                                                        =============                    ============
    Diluted                                                                    40,619                          33,489
                                                                        =============                    ============
</TABLE>

                                       5
<PAGE>

                            CABOT INDUSTRIAL TRUST

                CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
           For the Six Months ended June 30, 2000 and June 30, 1999
                           (unaudited, in thousands)

<TABLE>
<CAPTION>
                                                                                 Six Months Ended              Six Months Ended
                                                                                  June 30, 2000                 June 30, 1999
                                                                          ----------------------------     ---------------------
<S>                                                                         <C>                              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net Income                                                                    $     25,733                     $     22,852
        Adjustments to reconcile net income to cash provided by operating
         activities:
             Depreciation and Amortization                                               20,291                           14,163
             Minority Interest Expense                                                   11,047                            7,866
             Gain on Sale of Real Estate                                                      -                           (3,404)
             Straight Line Rent Adjustment                                               (2,638)                          (1,376)
             Amortization of Deferred Financing Costs                                       614                              408
             Decrease/(Increase) in Rents and Other Receivables                             430                             (972)
             Increase in Accounts Payable                                                   145                              475
             Increase in Other Assets                                                    (3,534)                            (268)
             Increase in Accrued Real Estate Taxes                                        1,229                              846
             Increase/(Decrease) in Other Liabilities                                      (868)                           4,175
                                                                                 --------------                   --------------

     Cash Provided by Operating Activities                                               52,449                           44,765
                                                                                 --------------                   --------------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Property and Lease Acquisition Costs                                              (150,958)                        (179,214)
     Improvements to Property                                                                 -                             (842)
     Increase in Other Assets                                                            (1,299)                            (946)
     Investment in Joint Venture                                                           (946)                               -
     Notes Receivable from Joint Venture                                                 (6,016)                               -
     Repayments/(Advances to) from Cabot Advisors, net                                      326                             (330)
     Net Proceeds from Sale of Real Estate                                                    -                           10,377
                                                                                 --------------                   --------------

     Cash Used in Investing Activities                                                 (158,893)                        (170,955)
                                                                                 --------------                   --------------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from Issuance of Unsecured Debt                                                 -                          199,448
     Proceeds from Issuance of Secured Debt                                              61,900                           93,215
     Line of Credit Advances/(Repayments), net                                           20,000                         (196,000)
     Distributions Paid to Minority Interests                                           (11,171)                         (10,134)
     Distributions Paid to Common Shareholders                                          (28,231)                         (19,816)
     Debt Principal Repayments                                                           (2,044)                          (1,453)
     Net Proceeds from Issuance of Common Shares/Payment of Expenses of Issuance            (85)                               -
     Increase in Deferred Financing Costs                                                  (681)                          (2,375)
     Proceeds from Issuance of Common Shares, net                                             -                           (1,138)
     Proceeds from Issuance of Preferred Units, net                                      47,767                           63,309
     Increase in Other Assets                                                                 -                             (340)
                                                                                 --------------                   --------------
     Cash Provided by Financing Activities                                               87,455                          124,716
                                                                                 --------------                   --------------

Net Decrease in Cash and Cash Equivalents                                               (18,989)                          (1,474)
                                                                                 --------------                   --------------

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD                                          22,007                            2,301
                                                                                 --------------                   --------------

CASH AND CASH EQUIVALENTS - END OF PERIOD                                          $      3,018                     $        827
                                                                                 ==============                   ==============

Cash paid for interest and settlement of treasury lock,
     net of amounts capitalized                                                    $     20,290                     $     10,483
                                                                                 ==============                   ==============
</TABLE>

                                       6
<PAGE>

                            CABOT INDUSTRIAL TRUST

          CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS (continued)
           For the Six Months ended June 30, 2000 and June 30, 1999
                           (unaudited, in thousands)

DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES:

During the six months ended June 30, 1999, 22,033 Partnership Units were
exchanged for Common Shares.

In conjunction with real estate acquisitions, Cabot Trust assumed $11,156 of
indebtedness during the six months ended June 30, 2000 and assumed $19,135 of
indebtedness and issued Units valued at $2,743 during the six months ended June
30, 1999 (Note 2).

At June 30, 2000, accrued capital expenditures (including amounts included in
accounts payable) totaled $8,304, accrued offering costs totaled $945 and
accrued financing costs totaled $24.

At June 30, 1999, accrued capital expenditures (including amounts included in
accounts payable) totaled $10,949, accrued offering costs totaled $415 and
accrued financing costs totaled $269.


                                       7
<PAGE>

                            CABOT INDUSTRIAL TRUST

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 June 30, 2000

1.   General

Organization

Cabot Industrial Trust (Cabot Trust), a Maryland real estate investment trust,
was formed on October 10, 1997.  Cabot Trust is the managing general
partner of a limited partnership, Cabot Industrial Properties, L.P. (Cabot
L.P.), and conducts substantially all of its business through Cabot L.P.  As the
general partner of Cabot L.P., Cabot Trust has the exclusive power under the
agreement of limited partnership to manage and conduct the business of Cabot
L.P., and therefore Cabot Trust consolidates the assets, liabilities, and
results of operations of Cabot L.P. for financial reporting purposes.

Cabot Trust is a fully integrated, internally managed real estate company formed
to continue and expand the national real estate business of Cabot Partners
Limited Partnership (Cabot Partners).  Cabot Trust qualifies as a real estate
investment trust (a REIT) for federal income tax purposes.

As of June 30, 2000, Cabot Trust owned 350 industrial properties located in 22
markets throughout the United States, containing approximately 42 million
rentable square feet.  These properties were approximately 97.1% leased to 708
tenants at June 30, 2000.  Cabot Trust also owns a 20% equity interest in and
provides acquisition, asset and property management services to a joint venture
(the Joint Venture), which invests in industrial properties.

2.   The Formation Transactions, The Offerings and Ownership

The Formation Transactions

On February 4, 1998, under a Contribution Agreement executed by Cabot Trust,
Cabot L.P., Cabot Partners and various other contributors, 122 industrial real
estate properties, certain real estate advisory contracts and other assets were
(i) contributed to Cabot L.P. in exchange for general partnership units in Cabot
L.P. (Units) that may, subject to certain restrictions, be exchanged for Common
Shares of Cabot Trust (Common Shares) or (ii) contributed to Cabot Trust in
exchange for Common Shares.  The properties contributed to Cabot Trust were
concurrently contributed by it to Cabot L.P. in exchange for the number of Units
in Cabot L.P. equal to the number of Common Shares exchanged for the property.

Cabot L.P. contributed the real estate advisory contracts to Cabot Advisors,
Inc. (Cabot Advisors) and received 100% of the non-voting preferred stock of
Cabot Advisors, which entitles it to 95% of Cabot Advisors' net operating cash
flow.  All of the common stock of Cabot Advisors is owned by an officer of Cabot
Trust.

During the six months ended June 30, 1999, Cabot L.P. issued 143,087 Units in
conjunction with acquisitions and Cabot Trust issued 22,032,656 Common Shares to
limited partners of Cabot L.P. in exchange for Units of Cabot L.P.  For the year
ended December 31, 1999, Cabot L.P. issued a total of 177,448 Units in
conjunction with acquisitions and Cabot Trust issued a total of 22,032,656
Common Shares to limited partners of Cabot L.P. in exchange for Units of Cabot
L.P.

                                       8
<PAGE>

                            CABOT INDUSTRIAL TRUST

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                 June 30, 2000

At June 30, 2000, Cabot Trust owned 93.0% of the common equity of Cabot L.P.
The remaining 7.0%, which is owned by investors holding Cabot L.P. Units, is
considered Minority Interest.  Cabot Trust owned 93.1% of Cabot L.P. at June 30,
1999.

The Offerings

On February 4, 1998, Cabot Trust completed an offering of 8,625,000 Common
Shares at an offering price of $20.00 per share.  In addition, Cabot Trust
issued 1,000,000 Common Shares in a private offering at $20.00 per share
(collectively, the Offerings).  Cabot Trust contributed the net proceeds of the
Offerings to Cabot L.P. in exchange for the number of general partnership
interests in Cabot L.P. equal to the number of Common Shares sold in the
Offerings.

Cumulative Redeemable Perpetual Preferred Equity
During 1999 and 2000, Cabot L.P. completed private sales of the following
Cumulative Redeemable Perpetual Preferred Units (the "Preferred Units"):

<TABLE>
<CAPTION>
       Sale Date                     Series                Unit price              Liquidation Value             Net Proceeds
-----------------------      ---------------------     -----------------     ---------------------------    --------------------
<S>                            <C>                       <C>                   <C>                            <C>
April 29, 1999                 8.625% Series B              $    50                 $     65,000,000            $     63,175,000
September 3, 1999              8.625% Series C                   25                       65,000,000                  63,175,000
September 27, 1999             8.375% Series D                   50                       10,000,000                   9,715,000
December 9, 1999               8.375% Series E                   50                       10,000,000                   9,715,000
December 22, 1999              8.500% Series F                   25                       45,000,000                  44,025,000
March 23, 2000                 8.875% Series G                   25                       15,000,000                  14,425,000
May 25, 2000                   8.950% Series H                   25                       35,000,000                  33,975,000
                                                                                 -------------------        --------------------
                                                                                    $    245,000,000            $    238,205,000
                                                                                 ===================        ====================
</TABLE>

The Preferred Units, which may be called by Cabot L.P. at par on or after the
fifth anniversary of issuance in each case, have no stated maturity or mandatory
redemption provisions and are not convertible into any other securities of Cabot
L.P.

                                       9
<PAGE>

                            CABOT INDUSTRIAL TRUST

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                 June 30, 2000


3. Property Acquisitions

During the period from April 1, 2000 through June 30, 2000, Cabot Trust acquired
the following industrial properties:

<TABLE>
<CAPTION>
                                                                                                 Acquisition
            Property Location                       Property Type            Square Feet             Cost
-----------------------------------------    --------------------------    --------------     ----------------
                                                                                                     (000'S)
<S>                                            <C>                           <C>                <C>
Northmont Parkway, Duluth, GA                  Multitenant Distribution           145,940          $    12,391
Evergreen Boulevard, Duluth, GA                Multitenant Distribution           140,250

Brookford Street, Charlotte, NC                Multitenant Distribution           122,000          $     3,336

Capitol Avenue, Plano, TX                      Workspace                           50,270          $     4,993
Capitol Avenue, Plano, TX                      Workspace                           50,270

Cherry Street, Newark, CA                      Multitenant Distribution           226,322          $    28,649
Cherry Street, Newark, CA                      Multitenant Distribution           274,349
Cherry Street, Newark, CA                      Multitenant Distribution           108,170

Nations Ford Road, Charlotte, NC               Bulk Distribution                  259,200          $     9,022

Northmont Parkway, Duluth, GA                  Multitenant Distribution           132,912          $     7,124
                                                                           --------------        -------------
TOTALS                                                                          1,509,683          $    65,515
                                                                           ==============        =============
</TABLE>

4.    Debt Activity

On May 4, 1999, Cabot L.P. issued $200.0 million of senior unsecured redeemable
notes, due May 1, 2004.  The notes have a 7.125% coupon interest rate and were
priced at 99.724%, resulting in a discount of $552,000.

Cabot Trust assumed certain loans in connection with the Formation Transactions,
entered into loan agreements during 1999 and 2000, and assumed certain loans in
conjunction with several real estate acquisitions, all secured by certain
existing real estate assets (collectively, the Mortgage Loans).  At June 30,
2000, the Mortgage Loans totaling $234.9 million, bear coupon rates ranging from
7.25% - 9.67% and are secured by properties with a net book value of $378.7
million.  Certain of the debt assumed in conjunction with the acquisition of
properties bears a coupon interest rate that differed from the fair market value
interest rate at the date of acquisition.  In accordance with generally accepted
accounting principles, such debt was recorded at fair market value and interest
expense recorded in the accompanying consolidated statements of operations was
adjusted based on the fair market interest rate at the date of acquisition.

In conjunction with acquisitions made during the six months ended June 30, 2000,
Cabot Trust assumed debt of $11.2 million, with coupon interest rates ranging
from 7.85% to 8.38%, secured by properties with a net book value of
approximately $16.4 million.   In addition, Cabot L.P. borrowed $61.9 million on
June 30, 2000, which is secured by specific properties.  At quarter end, these
properties had a net book value of approximately $91.5 million.  This borrowing
has a fixed interest rate of 8.4% per annum and a 10-year term with monthly
installment payments beginning August 1, 2000.  Under this agreement, the first
24 installment payments will be interest only payments with no principal
reduction.  Beginning August 1, 2002, the monthly installments will consist of
both principal reduction and interest payments.

                                       10
<PAGE>

                            CABOT INDUSTRIAL TRUST

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                 June 30, 2000


Cabot Trust has entered into an interest rate cap arrangement relating to its
$325.0 million Acquisition Facility for a notional amount of $100.0 million for
the period from April 11, 2000 through October 11, 2000.  This arrangement is
intended to result in limiting the variable nature of the LIBOR component of
Cabot Trust's interest rate on an equivalent amount of borrowings to 7.0% per
annum.  Under the agreement, Cabot Trust's counter party is required to pay an
amount equal to interest on that notional principal amount of borrowings to the
extent that the relevant LIBOR exceeds 7.0%.

Interest expense of $16,000 was incurred related to interest rate cap and
similar agreements during the six months ended June 30, 2000, and approximately
$38,000 was incurred for the six months ended June 30, 1999.

During 1998, Cabot Trust also had entered into an interest rate hedge
transaction (referred to as a Treasury Lock) involving the future sale of $100.0
million of Treasury securities based on a rate of approximately 5.54% for such
securities in anticipation of a future debt issuance of at least $100.0 million
with a maturity of 10 years. At the March 31, 1999 contractual settlement date
for this transaction, Cabot Trust paid $2.5 million to its counter party in the
transaction, reflecting the decrease in Treasury security yields since the July
1998 commencement of the transaction. Because an offering of the size and
maturity contemplated when the interest rate hedge transaction was executed was
not completed by the time of, or shortly after, the March 31, 1999 settlement
date of the transaction, Cabot Trust recorded a loss of $2.5 million in the
quarter ended March 31, 1999.

5. Earnings per Share

In accordance with Statement of Financial Accounting Standards No. 128,
"Earnings per Share", basic earnings per share have been computed by dividing
net income by the weighted average number of shares outstanding during the
period.  Diluted earnings per share have been computed considering the dilutive
effect of the exercise of Unit and Common Share options granted by Cabot Trust.
Basic and diluted earnings per share were calculated as follows:

<TABLE>
<CAPTION>
                                                             Six Months Ended             Six Months Ended
                                                              June 30, 2000                June 30, 1999
                                                      ----------------------------    ---------------------
Basic:
<S>                                                     <C>                             <C>
Net Income                                                    $  25,733,000                   $  22,852,000
                                                           ----------------                ----------------
Weighted Average Common Shares                                   40,619,000                      33,489,000
                                                           ----------------                ----------------
Basic Earnings per Common Share                               $        0.63                   $        0.68
                                                           ================                ================

Diluted:
Net Income                                                    $  25,733,000                   $  22,852,000
Effect of Unit Options                                              (26,000)                         (8,000)
                                                           ----------------                ----------------
Income available to Common Shareholders, as adjusted          $  25,707,000                   $  22,844,000
                                                           ----------------                ----------------
Weighted Average Common Shares                                   40,619,000                      33,489,000
                                                           ----------------                ----------------
Diluted Earnings per Common Share                             $        0.63                   $        0.68
                                                           ================                ================
</TABLE>

                                       11
<PAGE>

                            CABOT INDUSTRIAL TRUST

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                 June 30, 2000

Approximately 4 million and 3 million options granted are excluded from the
above calculations for 2000 and 1999, respectively, since the impact of
consideration of these options at June 30, 2000 and June 30, 1999 was anti-
dilutive.


6. Investments in Joint Ventures

During the six months ended June 30, 2000, Cabot Trust earned, in the aggregate,
approximately $178,000 in net acquisition and asset management fees from the
Joint Venture. In addition, Cabot Trust earned income of approximately $20,000
from the Joint Venture, which is accounted for under the equity method of
accounting. These amounts are included as components of Earnings and Fees from
Joint Venture in the accompanying Consolidated Condensed Statement of
Operations. As of June 30, 2000, the Joint Venture owned three industrial
properties comprising approximately 290,000 square feet. Cabot Trust provided
bridge financing in the form of a note receivable to the Joint Venture in the
amount of $6,016,300. This note bears interest at 9.61% per annum and is
expected to be repaid by year end from the proceeds of the Joint Venture's
permanent financing.

In the normal course of operations, as of August 11, 2000, the Joint Venture has
also purchased approximately $9.6 million of real estate assets containing
approximately 136,000 square feet subsequent to June 30, 2000.

                                       12
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

The statements contained in this discussion and elsewhere in this report that
are not historical facts are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934.  These forward-looking statements are based on current
expectations, estimates and projections about the industry and markets in which
Cabot Trust operates, management's beliefs and assumptions made by management.
Words such as "expects", "anticipates", "intends", "plans", "believes", "seeks",
"estimates", and variations of such words and similar expressions are intended
to identify such forward-looking statements.  Such forward-looking statements
are not guarantees of future performance and involve risks and uncertainties.
Therefore, actual outcomes and results may differ materially from what is
expressed or suggested by such forward-looking statements.  Cabot Trust
undertakes no obligation to update publicly any forward-looking statements,
whether as a result of new information, future events or otherwise.  Cabot
Trust's operating results depend primarily on income from industrial properties,
which may be affected by various factors, including changes in national and
local economic conditions, competitive market conditions, uncertainties and
costs related to and the imposition of conditions on receipt of governmental
approvals and costs of material and labor, all of which may cause actual results
to differ materially from what is expressed herein.  Capital and credit market
conditions which affect Cabot Trust's cost of capital also influence operating
results.

Introduction

Cabot Trust is an internally managed, fully integrated real estate company,
focused on serving a variety of industrial space users in the country's
principal commercial markets. Cabot Trust owns and operates a diversified
portfolio of bulk distribution, multitenant distribution and "workspace" (light
industrial, R&D and similar facilities) properties throughout the United States.
At June 30, 2000, Cabot Trust owned 350 industrial properties, 10 of which
properties were acquired during the period from April 1, 2000 through June 30,
2000. Cabot Trust also owns a 20% equity interest in and provides acquisition,
asset and property management services to a joint venture (the Joint Venture)
which invests in industrial properties.

Results of Operations

Quarter Ended June 30, 2000 compared with Quarter Ended June 30, 1999

Net income allocable to common shareholders for the quarter ended June 30, 2000
totaled $13.0 million or $.32 per share, compared with $15.2 million or $.41 per
share for the quarter ended June 30, 1999. The 1999 results include a gain on
sale of $3.4 million, but there were no gains or losses recognized on sales in
2000. After consideration of the 1999 sale, the increase in net income is due in
part to the conversion of units to common shares discussed in Note 2 to the
financial statements, which resulted in a decrease in the allocation of income
to minority interest, but has no impact on net income per share. The decrease in
net income per share in 2000, after consideration of the 1999 sale, is primarily
attributable to the increase in depreciation and amortization offset by the
increased income related to acquisitions and additional income generated by the
company's properties.

Rental revenues were $52.2 million, including tenant reimbursements of $7.2
million, for the quarter ended June 30, 2000, compared with $37.2 million,
including tenant reimbursements of $5.2 million, for the quarter ended June 30,
1999. Total rental revenue of $36.5 million and $35.2 million was generated in
2000 and 1999, respectively, by the properties owned as of March 31, 1999, and
still owned at June 30, 2000, (the Quarterly Baseline Properties) and total
rental revenue of $15.7 million and $1.6 in 2000 and 1999, respectively, was
generated by the properties acquired or developed
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<PAGE>

subsequent to March 31, 1999. The growth in rental revenue for Quarterly
Baseline Properties is primarily attributable to rental increases for new
leases, extensions and renewals. The remainder of total rental revenue relates
to properties sold in 1999.

The operating margin (the ratio of total revenues minus property operating and
property tax expenses to total revenues) decreased to approximately 79% for the
quarter ended June 30, 2000 compared with 82% for the quarter ended June 30,
1999.  The decrease is primarily due to a change in the composition of leases,
primarily as a result of acquisitions of multitenant and workspace properties,
to more leases where Cabot Trust pays property and operating expenses and is
reimbursed by tenants compared to where the tenant pays these expenses directly.

Depreciation and amortization related to real estate assets totaled $10.4
million and $7.3 million for the quarters ended June 30, 2000 and 1999,
respectively.  The increase reflects the acquisition of approximately $448.3
million of real estate assets in 1999 and $129.1 million for the six months
ended June 30, 2000 and additional deferred lease acquisition costs for
Quarterly Baseline Properties.

Interest expense of $10.6 million for the quarter ended June 30, 2000 represents
interest incurred on $200.0 million of unsecured debt issued in May 1999,
borrowings under Cabot Trust's Acquisition Facility and an average of $172.2
million of secured debt, net of $900,000 of interest capitalized to development
projects. Interest expense of $5.8 million for the quarter ended June 30, 1999
represents interest incurred on $200.0 million of unsecured debt issued in May
1999, borrowings under Cabot L.P.'s Acquisition Facility and an average of
$153.7 million of secured debt, net of $746,000 of interest capitalized to
development projects.


General and administrative expense increased by $80,000, to $2.2 million for the
quarter ended June 30, 2000.  The increase is primarily due to an increase in
personnel to manage the acquisition, development, asset management and financing
activity from the increase in the number of Cabot Trust's properties from 267 to
350 at the end of each period.  As a percentage of rental revenues, general and
administrative expense decreased to 4.2% at June 30, 2000 from 5.7% at June 30,
1999.

Interest and other income, which consists primarily of interest earned on Cabot
Trust's invested cash balances and advances to the Joint Venture, as well as
earnings of Cabot Advisors, increased to $471,000 from $304,000 for the quarter
ended June 30, 2000, compared to the quarter ended June 30, 1999.  The increase
is primarily due to interest income from advances to the Joint Venture in 2000.

Minority interest expense represents net income allocable to holders of Cabot
L.P. Units and Cumulative Redeemable Perpetual Preferred Units.  At June 30,
2000, Cabot Trust owned 93.0% of Cabot L.P. and the minority common equity
ownership interest was 7.0%.  During the quarter ended June 30, 2000, the
average minority common equity ownership interest was 7.0%, whereas during the
quarter ended June 30, 1999, it was 7.1%.  Dividends accruable to Preferred
Unitholders, which totaled $4.9 million for the three months ended June 30,
2000, are also considered minority interest expense.

The increase in Preferred Unitholders' Distributions is due to the increase in
Cumulative Redeemable Perpetual Preferred Equity as discussed within Note 2 to
the financial statements.

Six Months Ended June 30, 2000 compared with Six Months Ended June 30, 1999

Net income allocable to common shareholders for the six months ended June 30,
2000 totaled $25.7 million or $.63 per share, compared with $22.9 million or
$.68 per share for the six months ended June 30, 1999. The increase in net
income allocable to common shareholders is due in part to the conversion of
Units to Common Shares discussed in Note 2 to the financial statements, which
resulted in a decrease in the allocation of income to minority interest, but has
no effect on net income per share.

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<PAGE>

The decrease in net income per share is primarily due to the inclusion in the
1999 results of a gain on sale of $3.4 million offset by a loss related to the
settlement of treasury lock of approximately $2.5 million during the quarter
ended March 31, 1999. There were no gains or losses recognized on sales in 2000
nor expenses related to settlement of treasury lock. After consideration of the
1999 sale and settlement of treasury lock, the decrease in net income per share
in 2000 is primarily attributable to increased depreciation and amortization,
offset by increased income related to acquisitions and additional income
generated by the company's properties.

Rental revenues were $102.0 million, including tenant reimbursements of $14.2
million, for the six months ended June 30, 2000, compared with $71.3 million,
including tenant reimbursements of $10.1 million, for the six months ended June
30, 1999.  Total rental revenue of $68.2 million and $65.8 million was generated
in 2000 and 1999, respectively, by the properties owned as of January 1, 1999,
and still owned at June 30, 2000, (the Baseline Properties) and total rental
revenue of $33.8 million and $4.7 in 2000 and 1999, respectively, was
generated by the properties acquired or developed subsequent to December 31,
1998.  The growth in rental revenue for Baseline Properties is primarily
attributable to rental increases for new leases, extensions and renewals.  The
remainder of total rental revenue relates to properties sold in 1999.

The operating margin (the ratio of total revenues minus property operating and
property tax expenses to total revenues) decreased to approximately 79% for the
six months ended June 30, 2000 compared with 81% for the six months ended June
30, 1999.  The decrease is primarily due to a change in the composition of
leases, primarily as a result of acquisitions of multitenant and workspace
properties, to more leases where Cabot Trust pays property and operating
expenses and is reimbursed by tenants compared to where the tenant pays these
expenses directly.

Depreciation and amortization related to real estate assets totaled $20.2
million and $14.1 million for the six months ended June 30, 2000 and 1999,
respectively.  The increase reflects the acquisition of approximately $448.3
million of real estate assets in 1999 and $129.1 million for the six months
ended June 30, 2000 and additional deferred lease acquisition costs for Baseline
Properties.

Interest expense of $20.0 million for the six months ended June 30, 2000
represents interest incurred on $200.0 million of unsecured debt issued in May
1999, borrowings under Cabot Trust's Acquisition Facility and an average of
$169.9 million of secured debt, net of $1.8 million of interest capitalized to
development projects. Interest expense of $10.1 million for the six months ended
June 30, 1999 represents interest incurred on $200.0 million of unsecured debt
issued in May 1999, borrowings under Cabot L.P.'s Acquisition Facility and an
average of $125.1 million of secured debt, net of $1.3 million of interest
capitalized to development projects.

General and administrative expense increased by $376,000, to $4.7 million for
the six months ended June 30, 2000.  The increase is primarily due to an
increase in personnel to manage the acquisition, development, asset management,
and financing activity from the increase in the number of Cabot Trust's
properties from 267 to 350 at the end of each period.  As a percentage of rental
revenues, general and administrative expense decreased to 4.6% at June 30, 2000
from 6.1% at June 30, 1999.

During 1998 Cabot Trust entered into an interest rate hedge transaction
(referred to as the "Treasury Lock") involving the future sale of $100.0 million
of Treasury securities based on an interest rate of approximately 5.54% for such
securities in anticipation of a future debt issuance of at least $100.0 million
with a maturity of 10 years.  At the March 31, 1999 contractual settlement date
for this transaction, Cabot Trust paid $2.5 million to its counter party in the
transaction, reflecting the decrease in Treasury security yields since the July
1998 commencement of the transaction.  Because an offering of the size and
maturity contemplated when the interest rate hedge transaction was executed was
not completed by the time of, or shortly after, the March 31, 1999 settlement
date of the transaction, Cabot

                                       15
<PAGE>

Trust recorded a loss related to the settlement of the treasury lock of
approximately $2.5 million during the quarter ended March 31, 1999.

Interest and other income, which consists primarily of interest earned on Cabot
Trust's invested cash balances and advances to the Joint Venture, as well as
earnings of Cabot Advisors, increased to $765,000 from $506,000 for the six
months ended June 30, 2000, compared to the six months ended June 30, 1999.  The
increase is primarily due to interest income from advances to the Joint Venture
in 2000.

Minority interest expense represents net income allocable to holders of Cabot
L.P. Units and Cumulative Redeemable Perpetual Preferred Units.  At June 30,
2000, Cabot Trust owned 93.0% of Cabot L.P. and the minority common equity
ownership interest was 7.0%.  As discussed in Note 2 to the financial
statements, during the six months ended June 30, 1999 a significant number of
Units were converted to Common Shares, resulting in a decrease in minority
interest expense related to Limited Partner Unitholders.  During the six months
ended June 30, 2000, the average minority common equity ownership interest was
7.0%, whereas during the six months ended June 30, 1999, it was 21.4%.
Dividends accruable to Preferred Unitholders, which totaled $9.1 million for the
six months ended June 30, 2000, are also considered minority interest expense.

The increase in Preferred Unitholders' Distributions is due to the increase in
Cumulative Redeemable Perpetual Preferred Equity as discussed within Note 2 to
the Financial Statements.

Capital Resources and Liquidity

Cabot Trust intends to rely on cash provided by operations, unsecured and
secured borrowings from institutional sources and public debt as its primary
sources of funding for acquisition, development, expansion and renovation of
properties.  Cabot Trust may also consider equity financing when such financing
is available on attractive terms.

Cabot L.P. borrowed $61.9 million on June 30, 2000, which is secured by specific
properties.  At quarter end, these properties had a net book value of
approximately $91.5 million.  This borrowing has a fixed interest rate of 8.4%
per annum and a 10-year term with monthly installment payments beginning August
1, 2000.  Under this agreement, the first 24 installment payments will be
interest only payments with no principal reduction.  Beginning August 1, 2002,
the monthly installments will consist of both principal reduction and interest
payments.

As discussed in Note 2 to the financial statements, as of June 30, 2000 Cabot
L.P. issued an aggregate of $245.0 million of Cumulative Redeemable Perpetual
Preferred Units in seven separate transactions in 1999 and 2000.  The net
proceeds from these transactions were $238.2 million which was used to pay down
outstanding balances under the Acquisition Facility.  These Cumulative
Redeemable Perpetual Preferred Units are callable by Cabot L.P. at par on or
after the fifth anniversary of issuance.

In March 1998 Cabot Trust established a $325.0 million unsecured revolving line
of credit facility (the Acquisition Facility) with Morgan Guaranty Trust Company
of New York as lead agent for a syndicate of banks.  The Acquisition Facility is
used to fund property acquisitions, development activities, building expansions,
tenant leasing costs and other general corporate purposes.  The Acquisition
Facility contains certain limits and requirements for debt to asset ratios, debt
service coverage minimums and other limitations.  Cabot Trust believes cash flow
from operations not distributed to Shareholders and Unitholders will be
sufficient to cover tenant allowances and costs associated with renewal or
replacement of current tenants as their leases expire and recurring non-
incremental revenue generating capital expenditures.

                                       16
<PAGE>

As of June 30, 2000, Cabot Trust had $234.9 million of fixed rate debt secured
by properties, $183.0 million of unsecured borrowings under its Acquisition
Facility, $200.0 million of unsecured debt and a 35.9% debt-to-total market
capitalization ratio.  The debt-to-total market capitalization ratio is
calculated based on Cabot Trust's total consolidated debt as a percentage of the
market value of its outstanding Common Shares and Units (excluding those held by
Cabot Trust) and the liquidation value of Perpetual Preferred Units plus total
debt.

On April 12, 2000, Cabot Trust entered into a joint venture agreement with Chase
Capital Partners.  The Joint Venture is targeted towards investment in
industrial workspace properties.  The investors have committed approximately $44
million in equity to the venture of which 20% will be funded by Cabot Trust.  As
of June 30, 2000, the venture has purchased three properties for approximately
$21.8 million, containing approximately 290,000 square feet.  In the normal
course of operations, the Joint Venture has purchased approximately $9.6 million
of real estate assets containing approximately 136,000 square feet, subsequent
to quarter end through August 11, 2000.

Cabot Trust has entered into an interest rate cap arrangement relating to its
$325.0 million Acquisition Facility for a notional amount of $100.0 million for
the period from April 11, 2000 through October 11, 2000.  This arrangement is
intended to result in limiting the variable nature of the LIBOR component of
Cabot Trust's interest rate on an equivalent amount of borrowings to 7.0% per
annum.  Under the agreement, Cabot Trust's counter party is required to pay an
amount equal to interest on that notional principal amount of borrowings to the
extent that the relevant LIBOR exceeds 7.0%.

Cash and cash equivalents totaled $3.0 million at June 30, 2000.  Cash provided
by operating activities for the six months ended June 30, 2000, was $52.4
million.

Year 2000

During 1999, Cabot Trust completed its program of determining whether its
business operations would be affected by date sensitive calculation errors that
might result from computers whose programs do not properly recognize the year
2000 (commonly referred to as the "Year 2000 Issue").  Cabot Trust has not to
date experienced any effects on its results of operations or financial position
from the Year 2000 Issue, nor have any of Cabot Trust's vendors communicated to
Cabot Trust that they have experienced any such effects.

                                       17
<PAGE>

ITEM 3.  QUANTITATIVE DISCLOSURES ABOUT MARKET RISK

Cabot Trust's exposure to market risk has not changed materially from its
exposure at December 31, 1999.

                                       18
<PAGE>

                           PART II. OTHER INFORMATION


Item 1.    Legal Proceedings
               Not Applicable

Item 2.    Changes in Securities and Use of Proceeds
               Not Applicable

Item 3.    Defaults Upon Senior Securities
               Not Applicable

Item 4.    Submission of Matters to a Vote of Security Holders.

               On May 10, 2000, at the Annual Meeting of Shareholders, the
               shareholders reelected three incumbent Trustees to three-year
               terms expiring in 2003.  The Incumbent Trustees reelected at the
               meeting were Mr. Ferdinand Colloredo-Mansfeld, Mr. Robert E.
               Patterson and Mr. Christopher C. Milliken.  Mr. Colloredo-
               Mansfeld received 37,890,517 shares voted in favor of election
               with 10,157 shares withheld; Mr. Patterson received 37,890,517
               shares voted in favor of election with 10,157 withheld; and Mr.
               Milliken received 37,887,297 shares voted in favor of election
               with 13,377 shares withheld.  No abstentions or broker non-votes
               were recorded on the election of Trustees.

Item 5.   Other Information
               Not Applicable

Item 6.    Exhibits and Reports on Form 8-K

           (a) Exhibits
               27 Financial Data Schedule

           (b) Reports on Form 8-K.
               None

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<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized as of the 14th day of August 2000.


                                        CABOT INDUSTRIAL TRUST
                                        ----------------------
                                              Registrant


       8/14/00            /s/ Neil E. Waisnor
----------------------    -------------------
        Date              Neil E. Waisnor
                          Senior Vice President-Finance, Treasurer, Secretary


       8/14/00            /s/ Robert E. Patterson
----------------------   ------------------------
        Date             Robert E. Patterson
                         President

                                       20