<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: March 31, 2001     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 May 10, 2001, 40,659,128
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 2000 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, 2001
through March 31, 2001 are not necessarily indicative of the results that may be
expected for the period from January 1, 2001 through December 31, 2001.

                                       2
<PAGE>

                            CABOT INDUSTRIAL TRUST

                     CONSOLIDATED CONDENSED BALANCE SHEET
                  As of March 31, 2001 and December 31, 2000
                       (in thousands, except share data)

<TABLE>
<CAPTION>

                                                                         March 31, 2001                        December 31, 2000
                                                                         --------------                        -----------------
                                                                           (unaudited)
ASSETS:

INVESTMENT IN REAL ESTATE:
<S>                                                                   <C>                                   <C>
Rental Properties                                                         $    1,656,697                        $    1,653,777
Less:  Accumulated Depreciation                                                  (81,256)                              (73,857)
                                                                       -----------------                    ------------------
     Net Rental Properties                                                     1,575,441                             1,579,920
Properties under Development                                                      61,882                                64,296
                                                                       -----------------                    ------------------
                                                                          $    1,637,323                        $    1,644,216
                                                                       -----------------                    ------------------

OTHER ASSETS:
Cash and Cash Equivalents                                                 $        6,285                        $        3,003
Rents and Other Receivables, net of allowance for uncollectible
 accounts of $1,136 and $982 at March 31, 2001 and
 December 31, 2000, respectively                                                   4,619                                 3,432
Deferred Rent Receivable                                                          12,641                                11,573
Deferred Lease Acquisition Costs, net                                             38,620                                34,288
Deferred Financing Costs, net                                                      5,196                                 5,460
Investment in and Advances to Related Party                                        1,945                                   750
Investment in and Notes Receivable from Joint Ventures                            18,043                                12,518
Assets Held for Sale                                                              26,266                                35,882
Other Assets                                                                      31,631                                16,837
                                                                       -----------------                    ------------------

TOTAL ASSETS                                                              $    1,782,569                        $    1,767,959
                                                                       =================                    ==================

LIABILITIES AND SHAREHOLDERS' EQUITY:

LIABILITIES:
Mortgage Debt                                                             $      245,279                        $      246,379
Unsecured Debt                                                                   255,000                               255,000
Line of Credit Borrowings                                                        162,000                               149,000
Accounts Payable                                                                   1,735                                 1,160
Accrued Real Estate Taxes                                                         11,537                                11,385
Distributions Payable                                                             19,119                                16,069
Tenant Security Deposits and Prepaid Rents                                        10,380                                11,395
Other Liabilities                                                                 23,160                                22,666
                                                                       -----------------                    ------------------
                                                                          $      728,210                        $      713,054
                                                                       -----------------                    ------------------

MINORITY INTEREST:
Preferred Unitholders                                                     $      238,205                        $      238,205
Limited Partner Unitholders                                                       56,259                                56,920
                                                                       -----------------                    ------------------
                                                                          $      294,464                        $      295,125
                                                                       -----------------                    ------------------

SHAREHOLDERS' EQUITY:
Common Shares, $0.01 par value, 140,900,000 shares authorized;
 40,659,128 and 40,624,833 shares issued and outstanding at
 March 31, 2001 and December 31, 2000, respectively                       $          406                        $          406
Paid-in Capital                                                                  768,944                               768,303
Retained Deficit                                                                  (8,212)                               (8,929)
Accumulated Other Comprehensive Income                                            (1,243)                                  --
                                                                       -----------------                    ------------------

TOTAL SHAREHOLDERS' EQUITY                                                $      759,895                        $      759,780
                                                                       -----------------                    ------------------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                $    1,782,569                        $    1,767,959
                                                                       =================                    ==================
</TABLE>
The accompanying notes are an integral part of these unaudited consolidated
condensed financial statements.

                                       3
<PAGE>

                            CABOT INDUSTRIAL TRUST

                CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
         For the Three Months ended March 31, 2001 and March 31, 2000
               (unaudited, in thousands, except per share data)


<TABLE>
<CAPTION>
                                                                        Three Months Ended                  Three Months Ended
                                                                          March 31, 2001                      March 31, 2000
                                                                --------------------------------       --------------------------
<S>                                                                       <C>                                 <C>
REVENUES:
Rental Income                                                             $       47,764                       $        42,749
Tenant Reimbursements                                                              8,658                                 7,059
                                                                       -----------------                    ------------------
                Total Revenues                                            $       56,422                       $        49,808
                                                                       -----------------                    ------------------
EXPENSES:
Property Operating                                                        $        5,324                       $         4,546
Property Taxes                                                                     6,503                                 5,898
Depreciation and Amortization                                                     10,085                                 9,803
Interest                                                                          11,708                                 9,450
General and Administrative                                                         2,685                                 2,501
                                                                       -----------------                    ------------------
                Total Expenses                                            $       36,305                       $        32,198
                                                                       -----------------                    ------------------

OTHER INCOME:
Interest and Other Income                                                 $          341                       $           294
Earnings and Fees from Joint Ventures and Advisory Clients                           821                                    --
Net Gain on Sale of Real Estate                                                      949                                    --
                                                                       -----------------                    ------------------
                                                                          $        2,111                       $           294
                                                                       -----------------                    ------------------

Income Before Minority Interest Expense                                   $       22,228                       $        17,904

MINORITY INTEREST EXPENSE:
     Preferred Unitholders                                                        (5,294)                               (4,211)
     Limited Partner Unitholders                                                  (1,173)                                 (956)
                                                                       -----------------                    ------------------
Net Income                                                                $       15,761                       $        12,737
                                                                       =================                    ==================

Earnings per Common Share:
    Basic                                                                 $         0.39                       $          0.31
                                                                       =================                    ==================
    Diluted                                                               $         0.39                       $          0.31
                                                                       =================                    ==================

Weighted Average Common Shares:
    Basic                                                                         40,644                                40,619
                                                                       =================                    ==================
    Diluted                                                                       40,644                                40,619
                                                                       =================                    ==================
</TABLE>
The accompanying notes are an integral part of these unaudited consolidated
condensed financial statements.
                                       4
<PAGE>

                            CABOT INDUSTRIAL TRUST

                CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
         For the Three Months ended March 31, 2001 and March 31, 2000
                           (unaudited, in thousands)

<TABLE>
<CAPTION>

                                                                                   Three Months Ended          Three Months Ended
                                                                                      March 31, 2001              March 31, 2000
                                                                                 ------------------------     --------------------

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                    <C>                      <C>
     Net Income                                                                        $     15,761             $       12,737
     Adjustments to Reconcile Net Income to Cash Provided by Operating
         Activities:
             Depreciation and Amortization                                                   10,085                      9,803
             Minority Interest Expense                                                        6,467                      5,167
             Net Gain on Sale of Real Estate                                                   (949)                        --
             Straight Line Rent                                                              (1,128)                    (1,360)
             Cabot Trust's Share of Net Income from Cabot Advisors and Joint                   (122)                       (60)
              Ventures
             Amortization of Deferred Financing Costs                                           482                        312
             Increase in Rents and Other Receivables                                         (1,187)                      (796)
             Increase in Accounts Payable                                                       398                      1,169
             Increase in Other Assets                                                          (538)                    (2,228)
             Increase in Accrued Real Estate Taxes                                              152                        232
             Increase (Decrease) in Other Liabilities                                          (472)                     2,272
                                                                                     --------------           ----------------
                   Net Cash Provided by Operating Activities                                 28,949                     27,248
                                                                                     --------------           ----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
     Property and Lease Acquisition Costs                                                   (17,932)                   (72,953)
     Notes Receivable from Joint Ventures                                                    (3,081)                        --
     Investment in Joint Ventures                                                            (2,262)                        --
     Decrease (Increase) in Other Assets                                                      5,662                     (1,026)
     Advances to Cabot Advisors, net                                                         (1,340)                      (194)
                                                                                     --------------           ----------------
                   Net Cash Used in Investing Activities                                    (18,953)                   (74,173)
                                                                                     --------------           ----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
     Line of Credit Borrowings, net                                                          13,000                     44,000
     Distributions Paid to Common Shareholders                                              (14,421)                   (13,811)
     Distributions Paid to Minority Interests                                                (3,981)                    (5,257)
     Proceeds from Issuances of Preferred Units, net                                             --                     13,661
     Debt Principal Repayments                                                               (1,100)                    (1,001)
     Increase in Deferred Financing Costs                                                      (197)                      (105)
     Other                                                                                      (15)                       (78)
                                                                                     --------------           ----------------

                   Net Cash (Used in) Provided by Financing Activities                       (6,714)                    37,409
                                                                                     --------------           ----------------

Net Increase (Decrease) in Cash and Cash Equivalents                                          3,282                     (9,516)
                                                                                     --------------           ----------------

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD                                               3,003                     22,007
                                                                                     --------------           ----------------

CASH AND CASH EQUIVALENTS - END OF PERIOD                                              $      6,285             $       12,491
                                                                                     ==============           ================

Cash paid for interest, net of amounts capitalized                                     $      8,908             $        5,491
                                                                                     ==============           ================
</TABLE>

                                       5
<PAGE>

                            CABOT INDUSTRIAL TRUST

          CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS (continued)
         For the Three Months ended March 31, 2001 and March 31, 2000
                           (unaudited, in thousands)


DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES:

In conjunction with real estate acquisitions, Cabot Trust assumed $6,085 of
indebtedness during the three months ended March 31, 2000.

At March 31, 2001, accrued capital expenditures (including amounts included in
accounts payable) totaled $7,907 and accrued offering costs totaled $799. At
March 31, 2000, accrued capital expenditures (including amounts included in
accounts payable) totaled $9,736, accrued offering costs totaled $815 and
accrued financing costs totaled $24.

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

                                       6
<PAGE>

                            CABOT INDUSTRIAL TRUST

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                March 31, 2001


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 financial results of Cabot L.P. for
financial reporting purposes.

As of March 31, 2001 and 2000, Cabot Trust owned approximately 93% 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, Limited Partnership
Unitholders.

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 March 31, 2001, Cabot Trust owned 360 industrial properties located in 21
markets throughout the United States, containing approximately 41 million
rentable square feet.  These properties were approximately 96.4% leased to 719
tenants at March 31, 2001.  Cabot Trust and its affiliates also own 20%
interests in and provide acquisition, development, asset and property management
services to joint ventures (the Joint Ventures) with three institutional
partners, each of which invests in industrial multi-tenant and workspace
properties or develops bulk distribution properties.  Cabot Trust's investment
in Joint Ventures is included in Investment in and Notes Receivable from Joint
Ventures on the accompanying consolidated condensed balance sheet.  Income
earned from the Joint Ventures is accounted for under the equity method of
accounting and is included in Earnings and Fees from Joint Ventures and Advisory
Clients in the accompanying consolidated condensed statement of operations.

2.   Significant Accounting Policies: Derivative Financial Instruments


                                       7
<PAGE>

                            CABOT INDUSTRIAL TRUST

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                March 31, 2001

Accounting Changes: Standards Implemented and Transition Adjustment

On January 1, 2001, Cabot Trust adopted Statement of Financial Accounting
Standards (SFAS) No. 133, "Accounting for Derivative Instruments and Hedging
Activities," as amended by SFAS No. 138, "Accounting for Certain Derivative
Instruments and Certain Hedging Activities-an Amendment of FASB Statement No.
133". SFAS No. 133, as amended, requires companies to carry all derivative
instruments, including certain embedded derivatives, in the statement of
financial condition at fair value. The accounting for changes in the fair value
of a derivative instrument depends on whether it has been designated and
qualifies as part of a hedging relationship and, if so, on the reason for
holding it. Cabot Trust uses only qualifying hedges that are designated
specifically to reduce exposure to interest rate risk by hedging the expected
future cash payments on certain liabilities. This is typically accomplished
using an interest rate cap, collar or swap agreement. For financial reporting
purposes these transactions qualify as cash flow hedges and the gain or loss on
the effective portion of the interest rate hedge is recorded as a component of
equity, which becomes reclassified into earnings along with payments on the
hedged liability. The effectiveness of the hedging relationship will be assessed
each reporting period, and any ineffectiveness measured, if applicable, will be
included in earnings.

As of January 1, 2001, Cabot Trust recorded a net transition adjustment of
$287,000 in accumulated other comprehensive income (equity). Adoption of the
standard also results in the recognition of $287,000 of derivative instrument
liabilities. In general, the amount of volatility will vary with the level of
derivative activities during any period.


                                       8
<PAGE>

                            CABOT INDUSTRIAL TRUST

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                March 31, 2001

The following table summarizes, at March 31, 2001, the notional value, carrying
value and fair value of Cabot Trust's derivative financial instruments.
The notional value at March 31, 2001 provides an indication of the extent of
Cabot Trust's involvement in these instruments at the time, but does not
represent exposure to credit, interest rate or market risks.

<TABLE>
<CAPTION>
                                                          Fixed
                                    Notional Value    Interest Rate   Maturity     Fair Value
                                    --------------    -------------   --------     ----------
<S>                                   <C>                 <C>          <C>         <C>
Interest Rate Swap                    $25,000,000         5.891%       2003        $ (664,000)
Interest Rate Swap                     25,000,000         5.905%       2003          (672,000)
</TABLE>

Cabot L.P. has entered into two interest rate swaps relating to the Acquisition
Facility for notional amounts of $25 million each, which are intended to result
in limiting the variable nature of the LIBOR component of Cabot L.P.'s interest
rate on an equivalent amount of borrowings to 5.891% and 5.905% through October
2003.  Cabot L.P. had entered into an interest rate cap arrangement relating to
the Acquisition Facility for a notional amount of $100 million for the period
from October 1, 1999 through April 1, 2000.  This arrangement resulted in
limiting the variable nature of the LIBOR component of Cabot L.P.'s interest
rate on an equivalent amount of borrowings to no more than 6.50% per annum.


Comprehensive Income

Comprehensive income combines net income and "other comprehensive items" that
represent certain amounts that are reported as components of shareholders'
equity in the accompanying consolidated condensed balance sheet, including
unrealized gains and losses on derivative instruments.

At March 31, 2001, the derivative instruments were reported at fair value under
Other Liabilities of $1,336,000. Other Comprehensive Income reflects unrealized
losses after impact of Minority Interest, of $1,243,000.

3.    Debt Activity

On October 24, 2000, Cabot L.P. obtained a new $325 million unsecured line of
credit facility (the Acquisition Facility) replacing its previous $325 million
credit facility that was to mature in March 2001.  The new credit facility
matures in October 2003, has a one-year extension option and a

                                       9
<PAGE>

                            CABOT INDUSTRIAL TRUST

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                March 31, 2001

$50 million expansion option. The new credit facility also includes certain
financial and nonfinancial covenants. Cabot Trust is a guarantor of the
facility. The interest rate on the Acquisition Facility for the three months
ended March 31, 2001 and 2000 was LIBOR plus 100 basis points (which includes a
20 basis point facility fee in 2001). As of May 10, 2001, the rate on the
borrowings at Cabot Trust's current credit rating is LIBOR plus 100 basis
points. At March 31, 2001 and 2000, the interest rate on outstanding borrowings
was 6.00% and 7.11%, respectively. The Acquisition Facility is used to acquire
and develop properties and for working capital purposes.

Cabot Trust assumed certain loans in connection with its formation, entered into
loan agreements during 1999 and 2000, and assumed certain loans in connection
with several real estate acquisitions, all secured by certain existing real
estate assets (collectively, the Mortgage Loans).  At March 31, 2001, the
Mortgage Loans totaled $245.3 million, have coupon interest rates ranging from
7.25% - 9.67% and are secured by properties with a net book value of $394.3
million.  Certain of the debt assumed in connection 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 was recorded in the accompanying consolidated condensed statement of
operations based on the fair market interest rate at the date of acquisition.

4. Earnings Per Share

In accordance with SFAS 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 each of the periods ended March 31, 2001 and 2000.

Diluted earnings per share have been computed considering the potentially
dilutive effect of the exercise of Unit options and warrants granted by Cabot
L.P. and Cabot Trust. Basic and diluted earnings per share were calculated as
follows:

                                       10
<PAGE>

                            CABOT INDUSTRIAL TRUST

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                March 31, 2001

<TABLE>
<CAPTION>
                                                            Three Months Ended             Three Months Ended
                                                              March 31, 2001                 March 31, 2000
                                                         ----------------------          ---------------------
<S>                                                           <C>                            <C>
Basic:
Net Income                                                    $  15,761,000                   $  12,737,000
                                                              -------------                   -------------
Weighted Average Common Shares                                   40,644,000                      40,619,000
                                                              -------------                   -------------
Basic Earnings per Common Share                               $        0.39                   $        0.31
                                                              =============                   =============
Diluted:
Net Income                                                    $  15,761,000                   $  12,737,000
Effect of Unit Options                                              (37,000)                         (9,000)
                                                              -------------                   -------------
Income available to Common Shareholders, as adjusted          $  15,724,000                   $  12,728,000
                                                              -------------                   -------------
Weighted Average Common Shares                                   40,644,000                      40,619,000
                                                              -------------                   -------------
Diluted Earnings per Common Share                             $        0.39                   $        0.31
                                                              =============                   =============
</TABLE>

Approximately 4 million options which have been granted are excluded from the
above calculations of diluted earnings per share for both the three months ended
March 31, 2001 and 2000, since the impact of consideration of these options was
anti-dilutive. In addition, 750,000 warrants granted in connection with the
establishment of a joint venture were excluded from the above calculation for
the three months ended March 31, 2001 since the impact of consideration of these
warrants was anti-dilutive.


5.  Joint Venture Activity

Cabot Trust and its affiliates have entered into joint venture agreements
(collectively, the Joint Ventures) with three institutional partners targeted
towards investment in industrial multi-tenant and workspace properties and
development of bulk distribution properties.  Cabot Trust and its affiliates
entered into a joint venture agreement with J.P. Morgan Partners (formerly Chase
Capital Partners) on April 12, 2000.  Cabot Trust subsequently entered into
joint venture agreements with GE Capital Real Estate (GE) on September 5, 2000
and Teachers Insurance and Annuity Association - College Retirement Fund (TIAA-
CREF) on November 16, 2000. In connection with the formation of the joint
venture with GE, Cabot Trust issued stock warrants to purchase 750,000 Common
Shares to GE at an exercise price of $27.00 per share for a term of five years
which had an estimated fair value of approximately $550,000 at the time of
issuance. As of March 31, 2001, the investors have committed approximately $192
million in equity to the Joint Ventures of which 20% has or will be funded by
Cabot L.P. or its affiliates. As of March 31, 2001, the Joint Ventures acquired
19 industrial properties costing approximately $86 million and comprising
approximately 1.3 million square feet, and stabilized two other properties that
were under development, totaling approximately 640,000 square feet.

Cabot Trust earned, in the aggregate, approximately $521,000 in acquisition,
development and asset management fees from the Joint Ventures during the three
months ended March 31, 2001.  In addition, Cabot Trust earned income of
approximately $85,000 from the Joint Ventures, which are accounted for under the
equity method of accounting.  These amounts are included in Earnings and Fees
from Joint Ventures and Advisory Clients in the accompanying consolidated
condensed statement of operations.

                                       11
<PAGE>

                            CABOT INDUSTRIAL TRUST

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                March 31, 2001

As of March 31, 2001, Cabot Trust and its affiliates provided financing to the
Joint Ventures in the form of notes receivable totaling $6,360,000. These notes
are expected to be repaid from the proceeds of the Joint Ventures' third party
financing. During the three months ended March 31, 2001, Cabot Trust and its
affiliates earned $129,000 of interest income from these notes receivable.


6.  Subsequent Events

On April 11, 2001, Cabot Trust sold two buildings located in California
containing approximately 209,000 square feet for a sales price of $9 million.
This sale is expected to result in a net gain of approximately $1 million.
Proceeds from the sale of this property are anticipated to be used to acquire
additional real estate assets.

On April 30, 2001, Cabot Trust acquired four buildings located in Texas
containing approximately 307,000 square feet for a purchase price of
approximately $20.2 million. This purchase was financed through reinvestment of
sale proceeds from a property sold during the quarter ended March 31, 2001.

                                       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, multi-tenant distribution and "workspace" (light
industrial, R&D and similar facilities) properties throughout the United States.
As of March 31, 2001, Cabot Trust owned 360 industrial properties.  Cabot Trust
also owns 20% equity interests in and provides acquisition, development, asset
and property management services to three joint ventures (the Joint Ventures),
which invest in and develop industrial properties.

Results of Operations

Quarter Ended March 31, 2001 compared with Quarter Ended March 31, 2000

Net income allocable to common shareholders for the quarter ended March 31, 2001
totaled $15.8 million or $.39 per share, compared with $12.7 million or $.31 per
share for the quarter ended March 31, 2000. The 2001 results include a gain on
sale of real estate of $949,000, but there were no significant gains or losses
on sales during the quarter ended March 31, 2000. After consideration of the
impact of the gain on sale of property in 2001, the increase in net income in
2001 of approximately $2.1 million is primarily due to increased income related
to acquisitions, additional income generated by the company's properties
(including a significant increase in termination payments - see below for
further discussion) and fees from and income generated by the Joint Ventures
offset by increased depreciation and amortization, interest expense, and
minority interest expense related primarily to Preferred Unitholders.

Rental revenues were $56.4 million, including tenant reimbursements of $8.7
million, for the quarter ended March 31, 2001, compared with $49.8 million,
including tenant reimbursements of $7.1 million, for the quarter ended March 31,
2000.  Total rental revenue of $48.0 million and $46.6 million was generated in
2001 and 2000, respectively, by the properties owned as of January 1, 2000, and
still owned

                                       13
<PAGE>

as of March 31, 2001, excluding properties held for sale, (the Baseline
Properties) and total rental revenue of $7.2 million and $1.3 million in 2001
and 2000, respectively, was generated by the properties acquired or developed
subsequent to January 1, 2000. The remainder of total rental revenue relates to
properties held for sale and properties sold in 2000 and 2001. The growth in
rental revenue for Baseline Properties is primarily attributable to rental
increases for new leases, extensions and renewals and an increase of
approximately $1.2 million in termination payments, due primarily to a
significant termination payment earned in the quarter ended March 31, 2001.

The operating margin (the ratio of total revenues minus property operating and
property tax expenses to total revenues) remained unchanged at 79% for the
quarters ended March 31, 2001 and 2000.

Depreciation and amortization related to real estate assets totaled $10.1
million and $9.8 million for the quarters ended March 31, 2001 and 2000,
respectively. The increase is primarily due to the acquisition of approximately
$152.2 million of real estate assets and $46.4 million of development properties
placed in service in 2000 offset by decreased depreciation related to properties
sold and Assets Held for Sale.

Interest expense of $11.7 million for the quarter ended March 31, 2001
represents interest incurred on $200.0 million of unsecured debt issued in May
1999, an additional $55.0 million of unsecured debt issued in September 2000,
borrowings under Cabot L.P.'s Acquisition Facility and an average of $245.8
million of secured debt, net of $919,000 of interest capitalized to development
projects.  Interest expense of $9.5 million for the quarter ended March 31, 2000
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
$167.2 million of secured debt, net of $942,000 of interest capitalized to
development projects.

General and administrative expense increased by $184,000, to $2.7 million for
the quarter ended March 31, 2001.  The increase is primarily due to an increase
in personnel to manage the acquisition, development, asset management and
financing activity caused by the increase in the number of Cabot Trust's
properties from 337 to 360 at the end of each period.  As a percentage of rental
revenues, general and administrative expense decreased to 4.8% at March 31, 2001
from 5.0% at March 31, 2000.

Interest and other income, which consists primarily of interest earned on Cabot
Trust's invested cash balances and advances to the Joint Ventures, as well as
earnings of Cabot Advisors, increased to $341,000 from $294,000 for the quarter
ended March 31, 2001, compared to the quarter ended March 31, 2000.  The
increase is primarily due to interest income from financing provided by Cabot
L.P. to the Joint Ventures.

Earnings and Fees from Joint Ventures and Advisory Clients consists of
acquisition, development and asset management fees of $736,000 earned from Joint
Venture arrangements as well as from third party clients for which Cabot Trust
performs services, and earnings from Joint Ventures accounted for under the
equity method of $85,000 for the quarter ended March 31, 2001. No such amounts
were earned during the quarter ended March 31, 2000.

During the quarter ended March 31, 2001, Cabot Trust sold three buildings for
$20.5 million, which resulted in a Gain on Sale of Real Estate of $949,000.
There were no significant sales during the quarter ended March 31, 2000.

Minority interest expense represents net income allocable to holders of Cabot
L.P. Limited Partnership Units and Cumulative Redeemable Perpetual Preferred
Units.  At March 31, 2001, Cabot Trust owned approximately

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<PAGE>

93% of Cabot L.P. and the minority common equity ownership interest was
approximately 7%. During the quarters ended March 31, 2001 and 2000 the average
minority common equity ownership interest was 7%. Dividends accruable to
Preferred Unitholders, totaled $5.3 million and $4.2 million for the quarters
ended March 31, 2001 and March 31, 2000, respectively. The increase in Minority
Interest Expense related to Preferred Unitholders is due to the issuance of
additional Cumulative Redeemable Perpetual Preferred Equity.

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, joint venture investment and
expansion and renovation of properties. Cabot Trust may also consider equity
financing when such financing is available on attractive terms. Cabot Trust also
expects acquisitions to be funded from reinvestment of proceeds from sales of
property via tax-free exchanges under Section 1031 of the Internal Revenue Code.

On September 7, 2000, Cabot L.P. established a Medium Term Note program eligible
to issue up to $200 million of notes payable.  On September 12, 2000, Cabot L.P.
issued $40 million of notes payable with a coupon interest rate of 8.5% due
September 15, 2010.  On September 18, 2000, Cabot L.P. issued an additional $15
million of notes payable with an 8.2% coupon interest rate, due September 15,
2005.

As of March 31, 2001, Cabot L.P. had issued an aggregate of $245 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 were 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 their respective issuance dates.

On October 24, 2000, Cabot L.P. obtained a new $325 million unsecured line of
credit facility replacing its previous $325 million credit facility that was to
mature in March 2001. The new credit facility matures in October 2003 and has a
one-year extension option and a $50 million expansion option. The new credit
facility also has certain financial and nonfinancial covenants. Cabot Trust is
a guarantor of the facility. The rate on the borrowings at Cabot Trust's current
credit rating is LIBOR plus 100 basis points. The Acquisition Facility is used
to fund property acquisitions, development activities, building expansions,
tenant leasing costs and for other general corporate purposes. 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.

As of March 31, 2001, Cabot Trust had $245.3 million of fixed rate debt secured
by properties, $162.0 million of unsecured borrowings under its Acquisition
Facility, $255.0 million of unsecured debt and a 38.1% 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
sum of the market value of its outstanding Common Shares and Units (excluding
those held by Cabot Trust), the liquidation value of Perpetual Preferred Units
and total debt at March 31, 2001.

Cabot Trust and its affiliates have entered into joint venture agreements
(collectively, the Joint Ventures) with three institutional partners targeted
towards investment in industrial multi-tenant and workspace properties and
development of bulk distribution properties.  Cabot Trust and its affiliates
entered into joint ventures with J.P. Morgan Partners (formerly Chase Capital
Partners) on April 12, 2000.  Cabot

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<PAGE>

Trust subsequently entered into joint venture agreements with GE Capital Real
Estate (GE) on September 5, 2000 and Teachers Insurance and Annuity Association-
College Retirement Fund (TIAA-CREF) on November 16, 2000. Stock warrants with an
estimated value of approximately $550,000 were issued to GE in connection with
the formation of the Joint Ventures. As of March 31, 2001, the investors have
committed approximately $192 million in equity to the ventures of which 20% has
or will be funded by Cabot Trust. As of March 31, 2001, these ventures have
purchased 19 properties for approximately $86 million, containing approximately
1.3 million square feet and stabilized two other properties that were under
development totaling approximately 640,000 square feet.

On April 11, 2001, Cabot Trust sold two buildings, located in California
containing approximately 209,000 square feet, for a sales price of $9 million.
This sale is expected to result in a net gain of approximately $1 million.
Proceeds from the sale of this property are anticipated to be used to acquire
additional real estate assets. Cabot Trust has also entered into agreements to
sell additional buildings, which are included in Assets Held for Sale on Cabot
Trust's consolidated condensed balance sheet as of March 31, 2001. Because sales
are subject to a number of conditions that must be met prior to closing, it is
uncertain as to whether these sales will actually be consummated.

Cash and cash equivalents totaled $6.3 million at March 31, 2001.  Cash provided
by operating activities for the three months ended March 31, 2001, was $28.9
million.


RATIO OF EARNINGS TO FIXED CHARGES

We have computed the ratios of earnings to fixed charges and preferred
distributions by dividing income from continuing operations, plus fixed charges,
plus amortization of capitalized interest, plus distributed income of equity
investees, less earnings of equity investees, less interest capitalized, by
fixed charges.  Fixed charges consist of interest costs, whether expensed or
capitalized, the interest component of rental expense and amortization of debt
premiums, discounts and issuance costs and preferred distributions.

The ratio of earnings to fixed charges was 1.89x for the three months ended
March 31, 2001 compared to 1.87x for the three months ended March 31, 2000. The
increase is primarily due to increased income related to acquisitions,
additional income generated by the Company's properties, fees and income
generated by the Joint Ventures and the gain on the sale of property, offset by
an increase in Minority Interest Expense, Preferred Unitholders and an increase
in interest expense and depreciation and amortization as discussed in the
"Results of Operations" above.

ITEM 3.  QUANTITATIVE DISCLOSURES ABOUT MARKET RISK

Cabot Trust's exposure to market risk has not changed materially from its
exposure at December 31, 2000.

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<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.
                  Not Applicable

Item 5.    Other Information
                  Not Applicable

Item 6.    Exhibits and Reports on Form 8-K
                  None

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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 May 2001.


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


    5/14/01              /s/ Neil E. Waisnor
    -------              -----------------------------
      Date               Neil E. Waisnor
                         Senior Vice President-Finance, Treasurer, Secretary


    5/14/01              /s/ Robert E. Patterson
    -------              -----------------------------
      Date               Robert E. Patterson
                         President

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