LIBERTY PROPERTY TRUST (Form: 10-Q, Received: 05/08/2008 15:35:00)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2008


o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to


Commission file numbers:		1-13130 (Liberty Property Trust) 1-13132 (Liberty Property Limited Partnership)

LIBERTY PROPERTY TRUST
LIBERTY PROPERTY LIMITED PARTNERSHIP

(Exact name of registrants as specified in their governing documents)


MARYLAND (Liberty Property Trust) PENNSYLVANIA (Liberty Property Limited Partnership)		23-7768996 23-2766549

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

500 Chesterfield Parkway Malvern, Pennsylvania		19355

(Address of Principal Executive Offices)		(Zip Code)

Registrants’ Telephone Number, Including Area Code (610) 648-1700

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

Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. (See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.) (Check one):


Large accelerated filer þ	Accelerated filer o	Non-accelerated filer o	Smaller reporting company o
	(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ

On May 6, 2008, 92,717,065 Common Shares of Beneficial Interest, par value $0.001 per share, of Liberty Property Trust were outstanding.

Liberty Property Trust/Liberty Property Limited Partnership
Form 10-Q for the period ended March 31, 2008


Index		Page

PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)

	Condensed consolidated balance sheets of Liberty Property Trust at March 31, 2008 and December 31, 2007		4

	Condensed consolidated statements of operations of Liberty Property Trust for the three months ended March 31, 2008 and March 31, 2007		5

	Condensed consolidated statements of cash flows of Liberty Property Trust for the three months ended March 31, 2008 and March 31, 2007		6

	Notes to condensed consolidated financial statements of Liberty Property Trust		7

	Condensed consolidated balance sheets of Liberty Property Limited Partnership at March 31, 2008 and December 31, 2007		13

	Condensed consolidated statements of operations of Liberty Property Limited Partnership for the three months ended March 31, 2008 and March 31, 2007		14

	Condensed consolidated statements of cash flows of Liberty Property Limited Partnership for the three months ended March 31, 2008 and March 31, 2007		15

	Notes to condensed consolidated financial statements of Liberty Property Limited Partnership		16

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations		22

Item 3.	Quantitative and Qualitative Disclosures about Market Risk		33

Item 4.	Controls and Procedures		33

PART II.	OTHER INFORMATION		34

Item 1.	Legal Proceedings		34

Item 1A.	Risk Factors		35

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		35

Item 3.	Defaults Upon Senior Securities		35

Item 4.	Submission of Matters to a Vote of Security Holders		35

Item 5.	Other Information		35

Item 6.	Exhibits		36

Signatures for Liberty Property Trust			37

Signatures for Liberty Property Limited Partnership			38

Exhibit Index			39

	LIBERTY PROPERTY TRUST 2008 LONG TERM INCENTIVE PLAN

	FORM OF OPTION GRANT AGREEMENT UNDER THE LIBERTY PROPERTY TRUST AMENDED AND RESTATED SHARE INCENTIVE PLAN

	FORM OF RESTRICTED SHARE UNIT GRANT AGREEMENT UNDER THE LIBERTY PROPERTY TRUST AMENDED AND RESTATED SHARE INCENTIVE PLAN

	STATEMENT RE: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO COMBINED FIXED CHARGES

	CERTIFICATIONS OF CEO OF LIBERTY PROPERTY TRUST REQUIRED BY RULE 13A-14(A)


		CERTIFICATIONS OF CFO OF LIBERTY PROPERTY TRUST REQUIRED BY RULE 13A-14(A)

		CERTIFICATIONS OF CEO OF LIBERTY PROPERTY TRUST, IN ITS CAPACITY AS THE GENERAL PARTNER OF LIBERTY PROPERTY LIMITED PARTNERSHIP, REQUIRED BY RULE 13A-14(A)

		CERTIFICATIONS OF CFO OF LIBERTY PROPERTY TRUST, IN ITS CAPACITY AS THE GENERAL PARTNER OF LIBERTY PROPERTY LIMITED PARTNERSHIP, REQUIRED BY RULE 13A-14(A)

		CERTIFICATIONS OF CEO OF LIBERTY PROPERTY TRUST REQUIRED BY RULE 13A-14(B)

		CERTIFICATIONS OF CFO OF LIBERTY PROPERTY TRUST REQUIRED BY RULE 13A-14(B)

		CERTIFICATIONS OF CEO OF LIBERTY PROPERTY TRUST, IN ITS CAPACITY AS THE GENERAL PARTNER OF LIBERTY PROPERTY LIMITED PARTNERSHIP, REQUIRED BY RULE 13A-14(B)

		CERTIFICATIONS OF CFO OF LIBERTY PROPERTY TRUST, IN ITS CAPACITY AS THE GENERAL PARTNER OF LIBERTY PROPERTY LIMITED PARTNERSHIP, REQUIRED BY RULE 13A-14(B)

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEETS OF LIBERTY PROPERTY TRUST
(In thousands, except share amounts)


	March 31, 2008			December 31, 2007
	(Unaudited)
ASSETS
Real estate:
Land and land improvements	$	783,042		$	796,501
Building and improvements		4,131,144			4,434,731
Less accumulated depreciation		(895,395	)		(863,609	)


Operating real estate		4,018,791			4,367,623

Development in progress		286,875			328,138
Land held for development		218,204			247,124


Net real estate		4,523,870			4,942,885

Cash and cash equivalents		6,924			37,989
Restricted cash		58,692			34,567
Accounts receivable		13,347			12,217
Deferred rent receivable		78,392			80,087
Deferred financing and leasing costs, net of accumulated amortization (2008, $127,234; 2007, $119,721)		131,210			144,689
Investments in and advances to unconsolidated joint ventures		316,348			278,383
Prepaid expenses and other assets		78,387			107,932


Total assets	$	5,207,170		$	5,638,749


LIABILITIES
Mortgage loans	$	236,085		$	243,169
Unsecured notes		2,155,000			2,155,000
Credit Facility		265,000			622,960
Accounts payable		42,502			44,666
Accrued interest		39,225			39,725
Dividend and distributions payable		60,256			59,849
Other liabilities		214,117			263,738


Total liabilities		3,012,185			3,429,107

Minority interest		370,987			372,621

SHAREHOLDERS’ EQUITY
Common shares of beneficial interest, $.001 par value, 187,987,000 shares authorized; 93,539,759 (includes 1,249,909 in treasury) and 92,817,879 (includes 1,249,909 in treasury) shares issued and outstanding as of March 31, 2008 and December 31, 2007, respectively		94			93
Additional paid-in capital		1,998,924			1,984,141
Accumulated other comprehensive income		21,248			21,378
Distributions in excess of net income		(144,317	)		(116,640	)
Common shares in treasury, at cost, 1,249,909 shares as of March 31, 2008 and December 31, 2007		(51,951	)		(51,951	)


Total shareholders’ equity		1,823,998			1,837,021


Total liabilities and shareholders’ equity	$	5,207,170		$	5,638,749

See accompanying notes.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS OF LIBERTY PROPERTY TRUST
(Unaudited and in thousands, except per share amounts)


	Three Months Ended
	March 31, 2008			March 31, 2007
OPERATING REVENUE
Rental	$	135,591		$	114,597
Operating expense reimbursement		57,897			50,221

Total operating revenue		193,488			164,818


OPERATING EXPENSE
Rental property		40,083			35,575
Real estate taxes		20,838			16,088
General and administrative		13,969			13,083
Depreciation and amortization		43,999			35,871

Total operating expenses		118,889			100,617


Operating income		74,599			64,201

OTHER INCOME (EXPENSE)
Interest and other income		3,097			2,517
Interest expense		(42,450	)		(27,024	)

Total other income (expense)		(39,353	)		(24,507	)

Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures		35,246			39,694
Gain on property dispositions		641			152
Income taxes		(484	)		(301	)
Minority interest		(6,408	)		(5,481	)
Equity in earnings of unconsolidated joint ventures		377			729


Income from continuing operations		29,372			34,793

Discontinued operations, net of minority interest (including net gain on property dispositions of $610 and $2,801 for the three months ended March 31, 2008 and 2007, respectively)		589			4,905


Net income	$	29,961		$	39,698


Earnings per common share
Basic:
Income from continuing operations	$	0.32		$	0.39
Income from discontinued operations		0.01			0.05


Income per common share — basic	$	0.33		$	0.44


Diluted:
Income from continuing operations	$	0.32		$	0.38
Income from discontinued operations		0.01			0.05


Income per common share — diluted	$	0.33		$	0.43


Distributions per common share	$	0.625		$	0.62


Weighted average number of common shares outstanding
Basic		91,715			91,036
Diluted		91,943			92,018

See accompanying notes.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW OF LIBERTY PROPERTY TRUST
(Unaudited and in thousands)


	Three Months Ended
	March 31, 2008			March 31, 2007
OPERATING ACTIVITIES
Net income	$	29,961		$	39,698
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		43,659			38,167
Amortization of deferred financing costs		1,118			993
Equity in earnings of unconsolidated joint ventures		(377	)		(729	)
Minority interest in net income		6,435			5,705
Gain on property dispositions		(1,251	)		(2,953	)
Noncash compensation		1,994			3,881
Changes in operating assets and liabilities:
Restricted cash		(24,156	)		25,703
Accounts receivable		(2,932	)		(2,542	)
Deferred rent receivable		(4,937	)		(2,304	)
Prepaid expenses and other assets		(9,685	)		2,550
Accounts payable		(2,166	)		3,802
Accrued interest		(500	)		(7,352	)
Other liabilities		2,159			5,877

Net cash provided by operating activities		39,322			110,496


INVESTING ACTIVITIES
Investment in properties		(14,670	)		(125,343	)
Investments in and advances to unconsolidated joint ventures		(3,670	)		(185	)
Distributions from unconsolidated joint ventures		1,455			405
Net proceeds from disposition of properties/land		291,688			82,776
Investment in development in progress		(67,067	)		(114,812	)
Investment in land held for development		(6,102	)		(66,963	)
Investment in deferred leasing costs		(7,385	)		(11,301	)

Net cash provided by (used in) investing activities		194,249			(235,423	)


FINANCING ACTIVITIES
Net proceeds from issuance of common shares		12,791			22,953
Net proceeds from issuance of preferred units		(1	)		(4	)
Repayments of mortgage loans		(7,084	)		(2,111	)
Proceeds from Credit Facility		170,400			330,950
Repayments on Credit Facility		(375,400	)		(179,950	)
Increase in deferred financing costs		—			(36	)
Distribution paid on common shares		(57,230	)		(56,364	)
Distribution paid on units		(8,070	)		(6,606	)

Net cash (used in) provided by financing activities		(264,594	)		108,832


Net decrease in cash and cash equivalents		(31,023	)		(16,095	)
(Decrease) increase in cash and cash equivalents related to foreign currency translation		(42	)		217
Cash and cash equivalents at beginning of period		37,989			53,737

Cash and cash equivalents at end of period	$	6,924		$	37,859

See accompanying notes.

Liberty Property Trust

Notes to Condensed Consolidated Financial Statements (Unaudited)
March 31, 2008

Note 1: Organization and Basis of Presentation

Organization

Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (a “REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by Liberty Property Limited Partnership (the “Operating Partnership” and, together with the Trust and their consolidated subsidiaries, the “Company”). The Trust is the sole general partner and also a limited partner of the Operating Partnership, owning 95.7% of the common equity of the Operating Partnership at March 31, 2008. The Company provides leasing, property management, development, acquisition and other tenant-related services for a portfolio of industrial and office properties which are located principally within the Mid-Atlantic, Southeastern, Midwestern and Southwestern United States and the United Kingdom. See a description of the Company’s markets in Note 2 to the Company’s financial statements.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Trust and its subsidiaries, including the Operating Partnership, have been prepared in accordance with United States generally accepted accounting principles (“US GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements and should be read in conjunction with the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K of the Trust and the Operating Partnership for the year ended December 31, 2007. In the opinion of management, all adjustments (consisting solely of normal recurring adjustments) necessary for a fair presentation of the financial statements for these interim periods have been included. The results of interim periods are not necessarily indicative of the results to be obtained for a full fiscal year. Certain amounts from prior periods have been reclassified to conform to the current period presentation.

Income per Common Share

The following table sets forth the computation of basic and diluted income per common share (in thousands except per share amounts):


	For the Three Months Ended March 31, 2008						For the Three Months Ended March 31, 2007
			Weighted						Weighted
			Average						Average
	Income		Shares				Income		Shares
	(Numerator)		(Denominator)		Per Share		(Numerator)		(Denominator)		Per Share
Basic income from continuing operations
Income from continuing operations	$	29,372		91,715	$	0.32	$	34,793		91,036	$	0.39

Diluted shares for long-term compensation plans		—		228				—		982


Diluted income from continuing operations
Income from continuing operations and assumed conversions		29,372		91,943	$	0.32		34,793		92,018	$	0.38


Basic income from discontinued operations
Discontinued operations net of minority interest		589		91,715	$	0.01		4,905		91,036	$	0.05

Dilutive shares for long-term compensation plans		—		228				—		982


Diluted income from discontinued operations
Discontinued operations net of minority interest		589		91,943	$	0.01		4,905		92,018	$	0.05


Basic income per common share
Net income		29,961		91,715	$	0.33		39,698		91,036	$	0.44

Dilutive shares for long-term compensation plans		—		228				—		982


Diluted income per common share
Net income and assumed conversions	$	29,961		91,943	$	0.33	$	39,698		92,018	$	0.43

Share-Based Compensation

At March 31, 2008, the Company had a share-based employee compensation plan (the “Plan”). The Plan provides that grants may be made in various forms including options, restricted shares and restricted stock units. The Company accounts for share-based compensation in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 123(R), “ Share-Based Payment ” (“SFAS No. 123(R)”).

The Company has authorized the grant of options under the Plan to executive officers, other key employees, non-employee trustees and consultants. All options granted have 10-year terms and most options vest over a three-year period, with options to purchase up to 20% of the shares exercisable after the first anniversary, up to 50% after the second anniversary and up to 100% after the third anniversary of the date of grant.

Restricted share grants made under the Plan are valued at the grant date fair value, which is the market price of the underlying common shares, and vest in accordance with terms set forth in the grant document, typically ratably over a five-year period beginning with the first anniversary of the date of grant.

In March 2008, the Compensation Committee of the Board of Trustees (the “Board”) adopted a 2008 Long-Term Incentive Plan (the “2008 Plan”) which is applicable to the Company’s executive officers. Pursuant to the 2008 Plan grants of restricted stock units were made. These restricted stock units can be earned over a three year period and vest in a single tranche on the third anniversary of the date of grant.

During the three months ended March 31, 2008 and 2007, the Company recognized $2.5 million and $2.4 million of share-based compensation expense, respectively.

Foreign Currency Translation

The functional currency of the Company’s United Kingdom operations is pounds sterling. The Company translates the financial statements for the United Kingdom operations into US dollars. Gains and losses resulting from this translation do not impact the results of operations and are included in accumulated other comprehensive income as a separate component of shareholders’ equity. Accumulated other comprehensive income consists solely of the foreign currency translation adjustments described. Other comprehensive loss for the three months ended March 31, 2008 was $0.1 million as compared to other comprehensive income of $0.4 million for the same period in 2007. Upon sale or upon complete or substantially complete liquidation of a foreign investment, the gain or loss on the sale will include the cumulative translation adjustments that have been previously recorded in accumulated other comprehensive income.

Note 2: Segment Information

The Company operates its portfolio of properties primarily throughout the Mid-Atlantic, Southeastern, Midwestern and Southwestern United States. Additionally, the Company owns certain assets in the United Kingdom. The Company reviews the performance of the portfolio on a geographical basis. As such, the following regions are considered the Company’s reportable segments:


Reportable Segments		Markets

Delaware Valley		Southeastern Pennsylvania; New Jersey
Midwest		Lehigh/Central PA; Minnesota; Milwaukee; Chicago
Mid-Atlantic		Maryland; Carolinas; Richmond; Virginia Beach
South		Jacksonville; Orlando; Boca Raton; Tampa; Texas; Arizona
Philadelphia		Comcast Center; Northern Virginia/Washington, D.C.
United Kingdom		County of Kent; West Midlands

The Company began to report the results of the Arizona market as part of the “South” reportable segment during the three months ended March 31, 2008 as compared to listing Arizona as its own reportable segment, as it was in 2007. As required by SFAS No. 131 (“SFAS No. 131”) “Disclosure about Segments of an Enterprise and Related Information,” consolidated financial statements issued by the Company in the future will reflect modifications to the Company’s reportable segments resulting from the change described above, including reclassification of all comparative prior period segment information.

The Company reflected $360.3 million in operating real estate assets as of December 31, 2007 for the Philadelphia segment in its Annual report on Form 10-K. At March 31, 2008 the Philadelphia segment held no operating real estate assets. See Note 4: Joint Ventures.

The Company’s reportable segments are distinct business units which are each managed separately in order to concentrate market knowledge within a geographic area. Within these reportable segments, the Company derives its revenues from its two product types: industrial properties and office properties.

The Company evaluates performance of the reportable segments based on property level operating income, which is calculated as rental revenue and operating expense reimbursement less rental property expenses and real estate taxes. The accounting policies of the reportable segments are the same as those for the Company on a consolidated basis.

The operating information by segment is as follows (in thousands):

FOR THE THREE MONTHS ENDED MARCH 31, 2008


	Delaware Valley				midwest
	Southeastern				Lehigh /				mid-				phila-		united
	Pennsylvania		Other		Central PA		Other		atlantic		South		delphia		kingdom		total
Operating revenue	$	44,929	$	14,247	$	24,642	$	20,469	$	37,193	$	40,284	$	10,680	$	1,044	$	193,488

Rental property expenses and real estate taxes		14,589		4,650		6,678		7,732		10,935		13,183		2,793		361		60,921

Property level operating income	$	30,340	$	9,597	$	17,964	$	12,737	$	26,258	$	27,101	$	7,887	$	683		132,567


Interest and other income																		3,097
Interest expense																		(42,450	)
General and administrative																		(13,969	)
Depreciation and amortization																		(43,999	)


Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures																		35,246
Gain on property dispositions																		641
Income taxes																		(484	)
Minority interest																		(6,408	)
Equity in earnings of unconsolidated joint ventures																		377
Discontinued operations, net of minority interest																		589

Net income																	$	29,961

FOR THE THREE MONTHS ENDED MARCH 31, 2007


	Delaware Valley				midwest
	Southeastern				Lehigh /				mid-				phila-			united
	Pennsylvania		Other		Central PA		Other		atlantic		South		delphia			kingdom		total
Operating revenue	$	43,196	$	13,913	$	20,748	$	19,198	$	32,149	$	35,212	$	—		$	402	$	164,818
Rental property expenses and real estate taxes		14,787		4,288		4,884		6,834		10,073		10,656		2			139		51,663

Property level operating income	$	28,409	$	9,625	$	15,864	$	12,364	$	22,076	$	24,556	$	(2	)	$	263		113,155


Interest and other income																			2,517
Interest expense																			( 27,024	)
General and administrative																			(13,083	)
Depreciation and amortization																			( 35,871	)


Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures																			39,694
Gain on property dispositions																			152
Income taxes																			(301	)
Minority interest																			(5,481	)
Equity in earnings of unconsolidated joint ventures																			729
Discontinued operations, net of minority interest																			4,905

Net income																		$	39,698

Note 3: SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”

In accordance with SFAS No. 144, the operating results and gain/(loss) on disposition of real estate for properties sold and held for sale are reflected in the consolidated statements of operations as discontinued operations. Prior period financial statements have been adjusted for discontinued operations. The proceeds from dispositions of operating properties with no continuing involvement were $3.4 million and $84.2 million for the three months ended March 31, 2008 and 2007, respectively.

Below is a summary of the results of operations for the properties held for sale and disposed of through the respective disposition dates (in thousands):


	Three Months Ended
	March 31,			March 31,
	2008			2007

Revenues	$	58		$	11,549
Operating expenses		(22	)		(4,654	)
Interest expense		(12	)		(1,903	)
Depreciation and amortization		(18	)		(2,664	)

Income before property dispositions and minority interest	$	6		$	2,328

Interest expense is allocated to discontinued operations as permitted under EITF Issue 87-24, “ Allocation of Interest to Discontinued Operations ,” and such interest expense has been included in computing income from discontinued operations. The allocation of interest expense to discontinued operations was based on the ratio of net assets sold (without continuing involvement) to the sum of total net assets plus consolidated debt.

Note 4: Joint Ventures

The Company has an interest in several unconsolidated joint ventures which are fully described in its 2007 Form 10-K. Joint ventures in which the Company has an interest which were either formed or had significant activity during 2007 or 2008 are as follows.

Liberty/Commerz 1701 JFK Boulevard, LP

On April 13, 2006, the Company entered into a joint venture pursuant to which it sold an 80% interest in the equity of Comcast Center, a 1.25 million square foot office tower the Company was developing in Philadelphia, Pennsylvania. The transaction valued the property at $512 million. Under the terms of the joint venture, the Company is obligated to complete the development and lease up of the office building. Upon signing the joint venture agreement and through March 30, 2008, the criteria for sale recognition in accordance with SFAS No. 66, “Accounting for the Sales of Real Estate” (“SFAS No. 66”) had not been met and the transaction was accounted for as a financing arrangement.

As of March 31, 2008, 1.0 million square feet of Comcast Center was in service and the obligation to fund rent support based on signed leases was approximately $1.0 million. On March 31, 2008, a $324 million, ten-year secured permanent financing at a rate of 6.15% for Comcast Center was funded. The proceeds from this financing were used to pay down outstanding borrowings on the Company’s credit facility.

On March 31, 2008, all conditions for sale treatment as outlined in SFAS No. 66 were satisfied and the Company recognized the sale of Comcast Center to an unconsolidated joint venture. Profit on the transaction has been deferred until the costs of the project can be reasonably estimated.

Liberty Washington, LP

On October 4, 2007, the Company acquired Republic Property Trust, a Maryland real estate investment trust and Republic Property Limited Partnership, a Delaware limited partnership and Republic’s operating partnership (together, “Republic”) for $913 million. The acquisition of Republic was completed through the merger of Republic with a wholly owned subsidiary of the Company and the merger of Republic’s operating partnership with the Company’s Operating Partnership. Republic operated a portfolio consisting of 2.4 million square feet of office space and six acres of developable land in the Northern Virginia and Washington, D.C. markets. Additionally, Republic was developing a property that, when completed, is expected to contain an additional 176,000 square feet of office space.

Concurrently, the Company formed a joint venture with New York State Common Retirement Fund to own and manage the Republic portfolio. The joint venture, in which the Company holds a 25% interest, purchased the Republic real estate assets for $900 million. The acquisition of Republic resulted in the Company recording $13 million in goodwill and other intangibles. In addition, the Company holds a $59.5 million note receivable from Liberty Washington, LP. The note bears interest at 5.25% and is due in September 2008.

Blythe Valley JV Sarl

On September 10, 2007, the Company entered into a joint venture to acquire Blythe Valley Park, West Midlands, UK for $325 million. The park consists of 491,000 square feet of operating properties and 98 acres of developable land. The Company holds a $3.9 million note receivable from Blythe Valley JV Sarl and has a 20% interest in the joint venture.

Note 5: Recently Issued Accounting Standards

SFAS No. 157

In September 2006, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standard, (“SFAS”) No. 157, “Fair Value Measurements” (“SFAS No. 157”), which defines fair value, establishes a framework for consistently measuring fair value under US GAAP and expands disclosures about fair value measurements. The Company adopted the provisions of SFAS No. 157 on January 1, 2008. The adoption of this statement did not have a material effect on the Company’s financial position or results of operations.

SFAS No. 159

In February 2007, the FASB issued SFAS No. 159, “ The Fair Value Option for Financial Assets and Financial Liabilities ” (“SFAS No. 159”). SFAS No. 159 provides companies with an option to report selected financial assets and liabilities at fair value and establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. The Company adopted the provisions of SFAS No. 159 on January 1, 2008. The adoption of this statement did not have a material effect on the Company’s financial position or results of operations.

SFAS No. 141(R)

In December 2007, the FASB issued SFAS No. 141(R), “ Applying the Acquisition Method” (“SFAS No. 141(R)”). This statement changes the accounting for acquisitions specifically eliminating the step acquisition model, changing the recognition of contingent consideration from being recognized when it is probable to being recognized at the time of acquisition, disallowing the capitalization of transaction costs and delays when restructurings related to acquisitions can be recognized. SFAS No. 141(R) is effective for fiscal years beginning after December 15, 2008 and will impact the accounting for acquisitions made beginning January 1, 2009. The Company is currently assessing the potential impact that the adoption of SFAS No. 141(R) will have on its financial position and results of operations.

SFAS No. 160

In December 2007, the FASB issued SFAS No. 160, “ Accounting for Noncontrolling Interests” (“SFAS No. 160”). Under this statement, noncontrolling interests are considered equity and thus the Company’s practice of reporting minority interests in the mezzanine section of the balance sheet will be eliminated. Also, under SFAS No. 160, net income will encompass the total income of all consolidated subsidiaries and there will be separate disclosure on the face of the income statement of the attribution of that income between controlling and noncontrolling interests. Last, increases and decreases in noncontrolling interests will be treated as equity transactions. The standard is effective for the year ending December 31, 2009. The Company is currently assessing the potential impact that the adoption of SFAS No. 160 will have on its financial position and results of operations.

Note 6: Supplemental Disclosure to Statements of Cash Flows

The following are supplemental disclosures to the statements of cash flows for the three months ended March 31, 2008 and 2007 (amounts in thousands):


Non-cash activity	2008			2007
Write-off of fully depreciated property and deferred costs	$	1,264		$	24,443
Increase in investment in unconsolidated joint ventures		(35,172	)		—
Disposition of properties/development in progress		173,624			—
Disposition of deferred leasing/financing costs		12,526			—
Reduction of accounts receivable		7,854			—
Reduction of deferred rent receivable		6,580			—
Reduction of prepaid and other assets		38,486			—
Reduction of Credit Facility		(152,960	)		—
Reduction of other liabilities		(50,938	)		—

CONDENSED CONSOLIDATED BALANCE SHEETS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(In thousands)


	March 31, 2008			December 31, 2007
	(Unaudited)
ASSETS
Real estate:
Land and land improvements	$	783,042		$	796,501
Building and improvements		4,131,144			4,434,731
Less accumulated depreciation		(895,395	)		(863,609	)


Operating real estate		4,018,791			4,367,623

Development in progress		286,875			328,138
Land held for development		218,204			247,124


Net real estate		4,523,870			4,942,885

Cash and cash equivalents		6,924			37,989
Restricted cash		58,692			34,567
Accounts receivable		13,347			12,217
Deferred rent receivable		78,392			80,087
Deferred financing and leasing costs, net of accumulated amortization (2008, $127,234; 2007, $119,721)		131,210			144,689
Investments in and advances to unconsolidated joint ventures		316,348			278,383
Prepaid expenses and other assets		78,387			107,932


Total assets	$	5,207,170		$	5,638,749


LIABILITIES
Mortgage loans	$	236,085		$	243,169
Unsecured notes		2,155,000			2,155,000
Credit Facility		265,000			622,960
Accounts payable		42,502			44,666
Accrued interest		39,225			39,725
Distributions payable		60,256			59,849
Other liabilities		214,117			263,738


Total liabilities		3,012,185			3,429,107

Minority interest		347			517

OWNERS’ EQUITY
General partner’s equity — common units		1,823,998			1,837,021
Limited partners’ equity — preferred units		287,960			287,960
— common units		82,680			84,144

Total owners’ equity		2,194,638			2,209,125


Total liabilities and owners’ equity	$	5,207,170		$	5,638,749

See accompanying notes.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(Unaudited and in thousands, except per unit amounts)


	Three Months Ended
	March 31, 2008			March 31, 2007
OPERATING REVENUE
Rental	$	135,591		$	114,597
Operating expense reimbursement		57,897			50,221

Total operating revenue		193,488			164,818


OPERATING EXPENSE
Rental property		40,083			35,575
Real estate taxes		20,838			16,088
General and administrative		13,969			13,083
Depreciation and amortization		43,999			35,871

Total operating expenses		118,889			100,617


Operating income		74,599			64,201

OTHER INCOME (EXPENSE)
Interest and other income		3,097			2,517
Interest expense		(42,450	)		(27,024	)

Total other income (expense)		(39,353	)		(24,507	)

Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures		35,246			39,694
Gain on property dispositions		641			152
Income taxes		(484	)		(301	)
Minority interest		170			(36	)
Equity in earnings of unconsolidated joint ventures		377			729


Income from continuing operations		35,950			40,238

Discontinued operations (including net gain on property dispositions of $610 and $2,801 for the three months ended March 31, 2008 and 2007, respectively)		616			5,129


Net income		36,566			45,367

Preferred unit distributions		(5,253	)		(3,854	)


Income available to common unitholders	$	31,313		$	41,513


Earnings per common unit
Basic:
Income from continuing operations	$	0.32		$	0.39
Income from discontinued operations		0.01			0.05


Income per common unit — basic	$	0.33		$	0.44


Diluted:
Income from continuing operations	$	0.32		$	0.38
Income from discontinued operations		0.01			0.05


Income per common unit — diluted	$	0.33		$	0.43


Distributions per common unit	$	0.625		$	0.62


Weighted average number of common units outstanding
Basic		95,905			95,226
Diluted		96,133			96,208

See accompanying notes.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW OF
LIBERTY PROPERTY LIMITED PARTNERSHIP
(Unaudited and in thousands)


	Three Months Ended
	March 31, 2008			March 31, 2007
OPERATING ACTIVITIES
Net income	$	36,566		$	45,367
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		43,659			38,167
Amortization of deferred financing costs		1,118			993
Equity in earnings of unconsolidated joint ventures		(377	)		(729	)
Minority interest in net income		(170	)		36
Gain on property dispositions		(1,251	)		(2,953	)
Noncash compensation		1,994			3,881
Changes in operating assets and liabilities:
Restricted cash		(24,156	)		25,703
Accounts receivable		(2,932	)		(2,542	)
Deferred rent receivable		(4,937	)		(2,304	)
Prepaid expenses and other assets		(9,685	)		2,550
Accounts payable		(2,166	)		3,802
Accrued interest		(500	)		(7,352	)
Other liabilities		2,159			5,877

Net cash provided by operating activities		39,322			110,496


INVESTING ACTIVITIES
Investment in properties		(14,670	)		(125,343	)
Investments in and advances to unconsolidated joint ventures		(3,670	)		(185	)
Distributions from unconsolidated joint ventures		1,455			405
Net proceeds from disposition of properties/land		291,688			82,776
Investment in development in progress		(67,067	)		(114,812	)
Investment in land held for development		(6,102	)		(66,963	)
Investment in deferred leasing costs		(7,385	)		(11,301	)

Net cash provided by (used in) investing activities		194,249			(235,423	)


FINANCING ACTIVITIES
Repayments of mortgage loans		(7,084	)		(2,111	)
Proceeds from Credit Facility		170,400			330,950
Repayments on Credit Facility		(375,400	)		(179,950	)
Increase in deferred financing costs		—			(36	)
Capital contributions		12,790			22,949
Distribution to partners		(65,300	)		(62,970	)

Net cash (used in) provided by financing activities		(264,594	)		108,832


Net decrease in cash and cash equivalents		(31,023	)		(16,095	)
(Decrease) increase in cash and cash equivalents related to foreign currency translation		(42	)		217
Cash and cash equivalents at beginning of period		37,989			53,737

Cash and cash equivalents at end of period	$	6,924		$	37,859

See accompanying notes.

Liberty Property Limited Partnership
Notes to Condensed Consolidated Financial Statements (Unaudited)
March 31, 2008

Note 1: Organization and Basis of Presentation

Organization

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Operating Partnership and its subsidiaries have been prepared in accordance with United States generally accepted accounting principles (“US GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements and should be read in conjunction with the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K of the Trust and the Operating Partnership for the year ended December 31, 2007. In the opinion of management, all adjustments (consisting solely of normal recurring adjustments) necessary for a fair presentation of the financial statements for these interim periods have been included. The results of interim periods are not necessarily indicative of the results to be obtained for a full fiscal year. Certain amounts from prior periods have been reclassified to conform to the current period presentation.

Income per Common Unit

The following table sets forth the computation of basic and diluted income per common unit (in thousands, except per unit amounts):


	For the Three Months Ended March 31, 2008							For the Three Months Ended March 31, 2007
				Weighted							Weighted
	Income			Average Units				Income			Average Units
	(Numerator)			(Denominator)		Per Unit		(Numerator)			(Denominator)		Per Unit
Income from continuing operations	$	35,950						$	40,238
Less: Preferred unit distributions		(5,253	)						(3,854	)


Basic income from continuing operations
Income from continuing operations available to common unitholders		30,697			95,905	$	0.32		36,384			95,226	$	0.39

Dilutive units for long-term compensation plans		—			228				—			982


Diluted income from continuing operations
Income from continuing operations available to common unitholders and assumed conversions		30,697			96,133	$	0.32		36,384			96,208	$	0.38


Basic income from discontinued operations
Discontinued operations		616			95,905	$	0.01		5,129			95,226	$	0.05

Dilutive units for long-term compensation plans		—			228				—			982


Diluted income from discontinued operations
Discontinued operations		616			96,133	$	0.01		5,129			96,208	$	0.05


Basic income per common unit
Income available to common unitholders		31,313			95,905	$	0.33		41,513			95,226	$	0.44


Diluted units for long-term compensation plans		—			228				—			982


Diluted income per common unit
Income available to common unitholders and assumed conversions	$	31,313			96,133	$	0.33	$	41,513			96,208	$	0.43

Foreign Currency Translation

Note 2: Segment Information


Reportable Segments		Markets
Delaware Valley		Southeastern Pennsylvania; New Jersey
Midwest		Lehigh/Central PA; Minnesota; Milwaukee; Chicago
Mid-Atlantic		Maryland; Carolinas; Richmond; Virginia Beach
South		Jacksonville; Orlando; Boca Raton; Tampa; Texas; Arizona
Philadelphia		Comcast Center; Northern Virginia/Washington, D.C.
United Kingdom		County of Kent; West Midlands

FOR THE THREE MONTHS ENDED MARCH 31, 2008


	Delaware Valley				midwest
	Southeastern				Lehigh /								phila-		united
	Pennsylvania		Other		Central PA		Other		mid-atlantic		South		delphia		kingdom		total

Operating revenue	$	44,929	$	14,247	$	24,642	$	20,469	$	37,193	$	40,284	$	10,680	$	1,044	$	193,488

Rental property expenses and real estate taxes		14,589		4,650		6,678		7,732		10,935		13,183		2,793		361		60,921


Property level operating income	$	30,340	$	9,597	$	17,964	$	12,737	$	26,258	$	27,101	$	7,887	$	683		132,567


Interest and other income																		3,097
Interest expense																		(42,450	)
General and administrative																		(13,969	)
Depreciation and amortization																		(43,999	)


Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures																		35,246
Gain on property dispositions																		641
Income taxes																		(484	)
Minority interest																		170
Equity in earnings of unconsolidated joint ventures																		377
Discontinued operations																		616

Net income																	$	36,566

FOR THE THREE MONTHS ENDED MARCH 31, 2007


	Delaware Valley				midwest
	Southeastern				Lehigh /				mid-				phila-			united
	Pennsylvania		Other		Central PA		Other		atlantic		South		delphia			kingdom		total

Operating revenue	$	43,196	$	13,913	$	20,748	$	19,198	$	32,149	$	35,212	$	—		$	402	$	164,818

Rental property expenses and real estate taxes		14,787		4,288		4,884		6,834		10,073		10,656		2			139		51,663


Property level operating income	$	28,409	$	9,625	$	15,864	$	12,364	$	22,076	$	24,556	$	(2	)	$	263		113,155


Interest and other income																			2,517
Interest expense																			(27,024	)
General and administrative																			(13,083	)
Depreciation and amortization																			(35,871	)


Income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures																			39,694
Gain on property dispositions																			152
Income taxes																			(301	)
Minority interest																			(36	)
Equity in earnings of unconsolidated joint ventures																			729
Discontinued operations																			5,129

Net income																		$	45,367

Note 3: SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”

In accordance with SFAS No. 144, the operating results and gain/(loss) on disposition of real estate for properties sold and held for sale are reflected in the consolidated statements of operations as discontinued operations. Prior year financial statements have been adjusted for discontinued operations. The proceeds from dispositions of operating properties with no continuing involvement were $3.4 million and $84.2 million for the three months ended March 31, 2008 and 2007, respectively.

Below is a summary of the results of operations for the properties held for sale and disposed of through the respective disposition dates (in thousands):


	Three Months Ended
	March 31, 2008			March 31, 2007

Revenues	$	58		$	11,549
Operating expenses		(22	)		(4,654	)
Interest expense		(12	)		(1,903	)
Depreciation and amortization		(18	)		(2,664	)

Income before property dispositions and minority interest	$	6		$	2,328

Note 4: Joint Ventures

Liberty/Commerz 1701 JFK Boulevard, LP

As of March 31, 2008, 1.0 million square feet of Comcast Center was in service and the obligation to fund rent support based on signed leases was approximately $1.0 million. On March 31, 2008, a $324 million, ten year secured permanent financing at a rate of 6.15% for Comcast Center was funded. The proceeds from this financing were used to pay down outstanding borrowings on the Company’s credit facility.

Liberty Washington, LP

Blythe Valley JV Sarl

Note 5: Recently Issued Accounting Standards

SFAS No. 157

SFAS No. 159

SFAS No. 141(R)

SFAS No. 160

Note 6: Supplemental Disclosure to Statements of Cash Flows

The following are supplemental disclosures to the statements of cash flows for the three months ended March 31, 2008 and 2007 (amounts in thousands):


Non-cash activity	2008			2007
Write-off of fully depreciated property and deferred costs	$	1,264		$	24,443
Increase in investment in unconsolidated joint ventures		(35,172	)		—
Disposition of properties/development in progress		173,624			—
Disposition of deferred leasing/financing costs		12,526			—
Reduction of accounts receivable		7,854			—
Reduction of deferred rent receivable		6,580			—
Reduction of prepaid and other assets		38,486			—
Reduction of credit facility		(152,960	)		—
Reduction of other liabilities		(50,938	)		—

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

OVERVIEW

Liberty Property Trust (the “Trust”) is a self-administered and self-managed Maryland real estate investment trust (“REIT”). Substantially all of the Trust’s assets are owned directly or indirectly, and substantially all of the Trust’s operations are conducted directly or indirectly, by its subsidiary, Liberty Property Limited Partnership, a Pennsylvania limited partnership (the “Operating Partnership” and, collectively with the Trust and their consolidated subsidiaries, the “Company”).

The Company operates primarily in the Mid-Atlantic, Southeastern, Midwestern and Southwestern United States. Additionally, the Company owns certain assets in the United Kingdom.

As of March 31, 2008, the Company owned and operated 355 industrial and 296 office properties (the “Wholly Owned Properties in Operation”) totaling 61.3 million square feet. In addition, as of March 31, 2008, the Company owned 28 properties under development, which when completed are expected to comprise 5.4 million square feet (the “Wholly Owned Properties under Development”) and 1,215 acres of developable land, substantially all of which is zoned for commercial use. Additionally, as of March 31, 2008, the Company had an ownership interest, through unconsolidated joint ventures, in 44 industrial and 48 office properties totaling 12.4 million square feet (the “JV Properties in Operation” and, together with the Wholly Owned Properties in Operation, the “Properties in Operation”), five properties under development, which when completed are expected to comprise 753,000 square feet (the “JV Properties under Development” and, together with the Wholly Owned Properties under Development, the “Properties under Development”). In addition, the JV Properties Under Development include the remaining development of Comcast Center, which is expected to comprise 283,000 square feet. The Company also has an ownership interest through unconsolidated joint ventures in 715 acres of developable land, substantially all of which is zoned for commercial use.

The Company focuses on creating value for shareholders and increasing profitability and cash flow. With respect to its Properties in Operation, the Company endeavors to maintain high occupancy levels while increasing rental rates and controlling costs. The Company pursues development opportunities that it believes will create value and yield acceptable returns. The Company also acquires properties that it believes will create long-term value, and disposes of properties that no longer fit within the Company’s strategic objectives or in situations where it can optimize cash proceeds. The Company’s operating results depend primarily upon income from rental operations and are substantially influenced by rental demand for the Properties in Operation.

Rental demand for the Properties in Operation declined for the three months ended March 31, 2008 as compared to the year ended December 31, 2007. The Company successfully leased 5.3 million square feet during the three months ended March 31, 2008 and attained occupancy of 91.8% for the Wholly Owned Properties in Operation and 94.0% for the Joint Venture Properties in Operation for a combined occupancy of 92.2% for the Properties in Operation as of that date. The Company believes that straight line rents on renewal and replacement leases for 2008 will on average be equal to or up to 2% greater than rents on expiring leases. Furthermore, the Company believes that average occupancy for its Properties in Operation will not increase or decrease by more than 1% for 2008 compared to 2007.

WHOLLY OWNED CAPITAL ACTIVITY

Acquisitions

During the three months ended March 31, 2008, conditions for the acquisition of properties were unsettled because of adverse events in the credit markets. During the three months ended March 31, 2008, the Company did not acquire any properties. For 2008, the Company believes that wholly owned property acquisitions will be in the $100 million to $200 million range.

Dispositions

During the three months ended March 31, 2008, market conditions for dispositions were unsettled because of adverse events in the credit markets. Disposition activity allows the Company to, among other things, (1) reduce its holdings in certain markets and product types within a market; (2) lower the average age of the portfolio; and (3) take advantage of favorable market conditions to optimize the cash proceeds from the sale of certain assets. During the three months ended March 31, 2008, the Company realized proceeds of $5.8 million from the sale of one operating property representing 22,000 square feet and 13 acres of land. For 2008, the Company believes that it will dispose of $250 million to $350 million of operating properties.

Development

The Company continues to pursue development opportunities. During the three months ended March 31, 2008, the Company brought into service three Wholly Owned Properties under Development representing 237,000 square feet and a Total Investment of $23.2 million, and initiated $90.3 million in real estate development. “Total Investment” for a property is defined as the property’s purchase price plus closing costs and management’s estimate, as determined at the time of acquisition, of the cost of necessary building improvements in the case of acquisitions, or land costs and land and building improvement costs in the case of development projects, and, where appropriate, other development costs and carrying costs. As of March 31, 2008, the projected Total Investment of the Wholly Owned Properties under Development was $450.8 million. For 2008, the Company believes that it will bring into service from its development pipeline approximately $200 million to $300 million of Total Investment in operating real estate.

JOINT VENTURE CAPITAL ACTIVITY

The Company periodically enters into joint venture relationships in connection with the execution of its real estate operating strategy.

Acquisitions

During the three months ended March 31, 2008, none of the unconsolidated joint ventures in which the Company held an interest acquired any properties. For 2008, the Company believes that property acquisitions by unconsolidated joint ventures in which the Company has an interest will be in the $200 million to $250 million range.

Dispositions

During the three months ended March 31, 2008, none of the unconsolidated joint ventures in which the Company held an interest disposed of any properties and do not anticipate doing so during the remainder of 2008.

Development

During the three months ended March 31, 2008, none of the unconsolidated joint ventures in which the Company held an interest brought any development properties into service. As of March 31, 2008, the projected Total Investment of Joint Venture Properties under Development was $298.5 million. For 2008, the Company expects unconsolidated joint ventures (excluding Comcast Center) in which it holds an interest to bring into service $50 million to $70 million of Total Investment in operating properties.

Liberty/Commerz 1701 JFK Boulevard, LP

On April 13, 2006, the Company entered into a joint venture pursuant to which it sold an 80% interest in the equity of Comcast Center, a 1.25 million square foot office tower the Company was developing in Philadelphia, Pennsylvania. The transaction valued the property at $512 million. Under the terms of the joint venture, the Company is obligated to complete the development and lease up of the office building. Upon signing the joint venture agreement and through March 30, 2008, the criteria for sale recognition in accordance with SFAS No. 66, “Accounting for the Sale of Real Estate” (“SFAS 66”) had not been met and the transaction was accounted for as a financing arrangement.

On March 31, 2008, all conditions for sale treatment as outlined in SFAS 66 were satisfied and the Company recognized the sale of Comcast Center to an unconsolidated joint venture. Profit on the transaction has been deferred until the costs of the project can be reasonably estimated.

During the three months ended March 31, 2008, the Company brought into service 22,000 square feet of Comcast Center equaling $7.8 million of Total Investment. The balance of Comcast Center is scheduled to be brought into service during the three months ended June 30, 2008. The projected Total Investment at March 31, 2008 for the remainder of Comcast Center to be brought into service is $116.2 million.

PROPERTIES IN OPERATION

The composition of the Company’s Properties in Operation as of March 31, 2008 and 2007 is as follows (in thousands, except dollars and percentages):


	Net Rent
	Per Square Foot				Total Square Feet				Percent Occupied
	March 31				March 31				March 31
	2008		2007		2008		2007		2008			2007
Wholly Owned Properties in Operation:
Industrial-Distribution	$	4.45	$	4.35		28,265		27,109		93.4	%		91.7	%
Industrial-Flex	$	9.24	$	8.81		11,584		12,349		88.8	%		92.8	%
Office	$	14.05	$	13.54		21,497		20,688		91.3	%		91.7	%

	$	8.67	$	8.43		61,346		60,146		91.8	%		91.9	%


	Net Rent
	Per Square Foot				Total Square Feet				Percent Occupied
	March 31				March 31				March 31
	2008		2007		2008		2007		2008			2007
Joint Venture Properties in Operation:
Industrial-Distribution	$	4.07	$	3.90		8,020		5,841		94.2	%		93.6	%
Industrial-Flex	$	34.02	$	31.35		171		171		89.5	%		100.0	%
Office	$	24.99	$	35.34		4,240		364		93.8	%		97.8	%

	$	11.58	$	6.55		12,431		6,376		94.0	%		94.0	%


	Net Rent
	Per Square Foot				Total Square Feet				Percent Occupied
	March 31				March 31				March 31
	2008		2007		2008		2007		2008			2007
Properties in Operation:
Industrial-Distribution	$	4.36	$	4.27		36,285		32,950		93.6	%		92.0	%
Industrial-Flex	$	9.60	$	9.14		11,755		12,520		88.8	%		92.9	%
Office	$	15.89	$	13.94		25,737		20,052		91.7	%		91.8	%

	$	9.17	$	8.25		73,777		66,522		92.2	%		92.1	%

Geographic segment data for the three months ended March 31, 2008 and 2007 are included in Note 2 to the Company’s financial statements.

Forward-Looking Statements

When used throughout this report, the words “believes,” “anticipates” and “expects” and similar expressions are intended to identify forward-looking statements. Such statements indicate that assumptions have been used that are subject to a number of risks and uncertainties that could cause actual financial results or management plans and objectives to differ materially from those projected or expressed herein, including: the effect of national and regional economic conditions; rental demand; the Company’s ability to identify, and enter into agreements with suitable joint venture partners in situations where it believes such arrangements are advantageous; the Company’s ability to identify and secure additional properties and sites, both for itself and the joint ventures to which it is a party, that meet its criteria for acquisition or development; the availability and cost of capital; the effect of prevailing market interest rates; risks related to the integration of the operations of entities that we have acquired or may acquire; risks related to litigation; and other risks described from time to time in the Company’s filings with the SEC. Given these uncertainties, readers are cautioned not to place undue reliance on such statements.

Critical Accounting Policies and Estimates

Refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2007 for a discussion of critical accounting policies which include capitalized costs, revenue recognition, allowance for doubtful accounts, impairment of real estate and intangibles. During the three months ended March 31, 2008, there were no material changes to these policies.

Results of Operations

The following discussion is based on the consolidated financial statements of the Company. It compares the results of operations of the Company for the three months ended March 31, 2008 with the results of operations of the Company for the three months ended March 31, 2007. As a result of the varying levels of development, acquisition and disposition activities by the Company in 2008 and 2007, the overall operating results of the Company during such periods are not directly comparable. However, certain data, including the Same Store comparison, do lend themselves to direct comparison.

This information should be read in conjunction with the accompanying condensed consolidated financial statements and notes included elsewhere in this report.

Comparison of Three Months Ended March 31, 2008 to Three Months Ended March 31, 2007

Overview

The Company’s average gross investment in operating real estate owned for the three months ended March 31, 2008 increased to $5,253.6 million from $4,211.2 million for the three months ended March 31, 2007. This increase in operating real estate resulted in increases in rental revenue, operating expense reimbursement, rental property operating expenses, real estate taxes and depreciation and amortization expense.

Total operating revenue increased to $193.5 million for the three months ended March 31, 2008 from $164.8 million for the three months ended March 31, 2007. This $28.7 million increase was primarily due to the increase in investment in operating real estate, the increase in operating revenue from the Same Store group of properties, discussed below, and an increase in “Termination Fees,” which totaled $1.3 million for the three months ended March 31, 2008 as compared to $0.7 million for the same period in 2007. Termination Fees are fees that the Company agrees to accept in consideration for permitting certain tenants to terminate their leases prior to the contractual expiration date. Termination Fees are included in rental revenue.

Segments

The Company evaluates the performance of the Properties in Operation by reportable segment (see Note 2 to the Company’s financial statements for a reconciliation to net income). The following table identifies changes in reportable segments (dollars in thousands):


	Three Months Ended
	March 31, 2008		March 31, 2007			% inc (dec)
Property Level Operating Income:
Delaware Valley
— SE Pennsylvania	$	30,340	$	28,409			6.8%	(1)
— Other		9,597		9,625			(0.3	%)
Midwest
— Lehigh/Central PA		17,964		15,864			13.2	%(1)
— Other		12,737		12,364			3.0	%
Mid-Atlantic		26,258		22,076			18.9	%(2)
South		27,101		24,556			10.4	%(1)
Philadelphia		7,887		(2	)		N/A	(3)
United Kingdom		683		263			159.7	%(1)

Total property level operating income (4)	$	132,567	$	113,155			17.2	%


(1)		The increase for the three months ended March 31, 2008 versus the three months ended March 31, 2007 is primarily due to an increase in average gross investment in operating real estate during 2008 and an increase in rental rates. The increase was partially offset by a decrease in occupancy in 2008 compared to 2007.

(2)		The increase for the three months ended March 31, 2008 versus the three months ended March 31, 2007 is primarily due to an increase in average gross investment in operating real estate, an increase in rental rates and increased occupancy during 2008 compared to 2007.

(3)		The increase for the three months ended March 31, 2008 versus the three months ended March 31, 2007 is due to the operations of Comcast Center in 2008. Comcast Center was a development project during the three months ended March 31, 2007. On March 31, 2008 all conditions for sale treatment as outlined in SFAS No. 66 were satisfied and the Company recognized the sale of Comcast Center to an unconsolidated joint venture.

(4)		See a reconciliation of property level operating income to net income in the Same Store comparison below.

Same Store

Property level operating income, exclusive of Termination Fees, for the Same Store properties decreased to $110.2 million for the three months ended March 31, 2008 from $111.8 million for the three months ended March 31, 2007 on a straight line basis (which recognizes rental revenue evenly over the life of the lease) and decreased to $108.7 million for the three months ended March 31, 2008 from $109.9 million for the three months ended March 31, 2007 on a cash basis. These decreases of 1.5% and 1.1%, respectively, were primarily due to a decrease in occupancy for the Same Store properties.

Management generally considers the performance of the Same Store properties to be a useful financial performance measure because the results are directly comparable from period to period. Management further believes that the performance comparison should exclude Termination Fees since they are more event specific and are not representative of ordinary performance results. In addition, Same Store property level operating income exclusive of Termination Fees is considered by management to be a more reliable indicator of the portfolio’s baseline performance. The Same Store properties consist of the 601 properties totaling approximately 53.9 million square feet owned on January 1, 2007 and excluding properties sold through March 31, 2008.

Set forth below is a schedule comparing the property level operating income, on a straight line basis and on a cash basis, for the Same Store properties for the three months ended March 31, 2008 and 2007. Same Store property level operating income is a non-GAAP measure and does not represent income before property dispositions, income taxes, minority interest and equity in earnings of unconsolidated joint ventures because it does not reflect the consolidated operations of the Company. Investors should review Same Store results, along with Funds from operations (see “Liquidity and Capital Resources” section), GAAP net income and cash flow from operating activities, investing activities and financing activities when considering the Company’s operating performance. Also, set forth below is a reconciliation of Same Store property level operating income to net income (in thousands).


	Three Months Ended
	March 31, 2008			March 31, 2007
Same Store:
Rental revenue	$	113,204		$	112,858
Operating expenses:
Rental property expense		36,532			35,577
Real estate taxes		17,800			15,567
Operating expense recovery		(51,280	)		(50,106	)

Unrecovered operating expenses		3,052			1,038


Property level operating income		110,152			111,820
Less straight line rent		1,437			1,911


Cash basis property level operating income	$	108,715		$	109,909


Reconciliation of non-GAAP financial measure:
Property level operating income — Same Store	$	110,152		$	111,820
Property level operating income — properties purchased or developed subsequent to January 1, 2007		21,134			615
Termination fees		1,281			720
General and administrative expense		(13,969	)		(13,083	)
Depreciation and amortization expense		(43,999	)		(35,871	)
Other income (expense)		(39,353	)		(24,507	)
Gain on property dispositions		641			152
Income taxes		(484	)		(301	)
Minority interest		(6,408	)		(5,481	)
Equity in earnings of unconsolidated joint ventures		377			729
Discontinued operations, net of minority interest		589			4,905


Net income	$	29,961		$	39,698

General and Administrative

General and administrative expenses increased to $14.0 million for the three months ended March 31, 2008 from $13.1 million for the three months ended March 31, 2007. The increase was primarily due to increases in costs related to compensation expense for real estate personnel necessitated by the competitive real estate market and increases in personnel consistent with the size and complexity of the Company.

Depreciation and Amortization

Depreciation and amortization increased to $44.0 million for the three months ended March 31, 2008 from $35.9 million for the three months ended March 31, 2007. The increase was primarily due to the increase in gross investment in operating real estate during the respective periods and particularly the increased investment in tenant improvement costs, which are depreciated over a shorter period than buildings.

Interest Expense

Interest expense increased to $42.5 million for the three months ended March 31, 2008 from $27.0 million for the three months ended March 31, 2007. This increase was related to an increase in the average debt outstanding, which was $3,055.7 million for the three months ended March 31, 2008, compared to $2,462.4 million for the three months ended March 31, 2007 and a decrease in capitalized interest costs related to Comcast Center partially coming into service in late 2007 and 2008. The effect of the increase in the average debt outstanding and the decrease in capitalized interest costs was partially offset by a decrease in the weighted average interest rate to 6.2% for the three months ended March 31, 2008 from 6.5% for the three months ended March 31, 2007.

Interest expense allocated to discontinued operations for the three months ended March 31, 2008 and 2007 was $12,000 and $1.9 million, respectively. This decrease was due to the decrease in the level of dispositions in 2008 compared to 2007.

Other

Costs directly related to the development of Properties under Development and land being readied for development are capitalized. Capitalized development costs include interest, development-related salaries and benefits, property taxes, insurance and other directly identifiable costs incurred during the period of development. Capitalized development-related salaries and benefits historically represent approximately 1% to 2% of the cost of developed properties.

Gain on property dispositions increased to a gain of $641,000 for the three months ended March 31, 2008 compared to a gain of $152,000 for the three months ended March 31, 2007. The increase was due to an increase in gains on the sale of land in the three months ended March 31, 2008 compared to the three months ended March 31, 2007.

Income from discontinued operations decreased to $0.6 million for the three month period ended March 31, 2008 compared to $4.9 million for the three month period ended March 31, 2007. The decrease was primarily due to lower operating income and the decrease in gains recognized on sales which were $0.6 million for the three months ended March 31, 2008 compared to $2.8 million for the three months ended March 31, 2007.

As a result of the foregoing, the Company’s net income decreased to $30.0 million for the three months ended March 31, 2008 from $39.7 million for the three months ended March 31, 2007.

Liquidity and Capital Resources

As of March 31, 2008, the Company had cash and cash equivalents of $65.6 million, including $58.7 million in restricted cash.

Net cash flow provided by operating activities decreased to $39.3 million for the three months ended March 31, 2008 from $110.5 million for the three months ended March 31, 2007. This $71.2 million decrease was primarily due to a change in restricted cash. The change in restricted cash is due to the restriction of funds in the United Kingdom for the payment of infrastructure costs. Net cash flow provided by operating activities is the primary source of liquidity to fund distributions to shareholders and for the recurring capital expenditures and leasing transaction costs for the Company’s Wholly Owned Properties in Operation. The current net cash flow is not sufficient to cover these items. The shortfall for 2008 is estimated to be in the range of $20 million to $25 million. The Company anticipates covering this shortfall through additional borrowings and asset dispositions.

Net cash provided by investing activities was $194.2 million for the three months ended March 31, 2008 compared to net cash used of $235.4 million for the three months ended March 31, 2007. This $429.6 million change primarily resulted from an increase in net proceeds from the disposition of properties/land and a decrease in investment in properties, development in progress and land held for development. Net cash from the disposition of properties was provided through the sale of Comcast Center to an unconsolidated joint venture. The joint venture obtained the funds to purchase the property through the funding of a $324 million permanent financing. —See Note 4 to the Company’s financial statements.

Net cash used in financing activities was $264.6 million for the three months ended March 31, 2008 compared to net cash provided of $108.8 million for the three months ended March 31, 2007. This $373.4 million change was primarily due to the increased repayments on the Credit Facility relating to the dispositions during the three months ended March 31, 2008 and a decrease in proceeds from the Credit Facility due to decreased investment activity. Net cash provided by or used in financing activities includes proceeds from the issuance of equity and debt, net of debt repayments and equity repurchases and shareholder distributions. Cash provided by financing activities is a source of capital utilized by the Company to fund investment activities.

The Company funds its development and acquisitions with long-term capital sources and proceeds from the disposition of properties. For the three months ended March 31, 2008, a significant portion of these activities were funded through a $600 million Credit Facility (the “Credit Facility”). The interest rate on borrowings under the Credit Facility fluctuates based upon ratings from Moody’s Investors Service, Inc. (“Moody’s”), Standard and Poor’s Ratings Group (“S&P”) and Fitch, Inc. (“Fitch”). The current ratings for the Company’s senior unsecured debt are Baa2, BBB and BBB+ from Moody’s, S&P and Fitch, respectively. At these ratings, the interest rate for borrowings under the Credit Facility is 65 basis points over LIBOR. The Credit Facility contains an accordion feature whereby the Company may borrow an additional $200 million. The Credit Facility expires in January 2010, and has a one-year extension option.

Additionally, the Company has entered into an agreement to fund its planned improvements for the Kings Hill Phase 2 land development project. At March 31, 2008, a £7 million revolving Credit Facility is undrawn and available. The facility expires on November 22, 2011.

The Company uses debt financing to lower its overall cost of capital in an attempt to increase the return to shareholders. The Company staggers its debt maturities and maintains debt levels it considers to be prudent. In determining its debt levels, the Company considers various financial measures including the debt to gross assets ratio and the fixed charge coverage ratio. As of March 31, 2008 the Company’s debt to gross assets ratio was 43.5%, and for the three months ended March 31, 2008, the fixed charge coverage ratio was 2.2x. Debt to gross assets equals total long-term debt, borrowings under the Credit Facility divided by total assets plus accumulated depreciation. The fixed charge coverage ratio equals income from continuing operations before property dispositions and minority interest, including operating activity from discontinued operations, plus interest expense and depreciation and amortization, divided by interest expense, including capitalized interest, plus distributions on preferred units.

As of March 31, 2008, $236.1 million in mortgage loans and $2,155.0 million in unsecured notes were outstanding with a weighted average interest rate of 6.6%. The interest rates on $2,391.1 million of mortgage loans and unsecured notes are fixed and range from 5.00% to 8.75%. The weighted average remaining term for these mortgage loans and unsecured notes is 5.6 years.

The scheduled principal amortization and maturities of the Company’s mortgage loans, unsecured notes outstanding and the Credit Facility and the related weighted average interest rates as of March 31, 2008 are as follows (in thousands, except percentages):


	MORTGAGES										WEIGHTED
	PRINCIPAL		PRINCIPAL		UNSECURED		CREDIT				AVERAGE
	AMORTIZATION		MATURITIES		NOTES		FACILITY		TOTAL		INTEREST RATE
2008 (9 months)	$	6,374	$	29,333	$	—	$	—	$	35,707		7.11	%
2009		6,589		46,314		270,000		—		322,903		7.76	%
2010		5,823		4,736		200,000		265,000		475,559		5.69	%
2011		5,160		10,741		250,000		—		265,901		7.25	%
2012		4,336		32,875		235,000		—		272,211		6.47	%
2013		3,858		4,510		—		—		8,368		5.79	%
2014		3,889		2,684		200,000		—		206,573		5.66	%
2015		3,336		44,469		300,000		—		347,805		5.25	%
2016		2,409		16,880		300,000		—		319,289		5.55	%
2017		1,769		—		300,000		—		301,769		6.62	%
2018 & thereafter		—		—		100,000		—		100,000		7.50	%

	$	43,543	$	192,542	$	2,155,000	$	265,000	$	2,656,085		6.29	%

The Company anticipates that it will refinance or retire these maturities through its available sources of capital.

General

The Company has continued to focus on the performance of the Same Store portfolio. In addition, the Company has continued to pursue development and acquisition opportunities and the strategic disposition of certain properties. The Company endeavors to maintain high occupancy levels while increasing rental rates and controlling costs.

The expiring square feet and annual net rent by year for the Properties in Operation as of March 31, 2008 are as follows (in thousands):


	Industrial-				Industrial-
	Distribution				Flex				Office				Total
	Square		Annual		Square		Annual		Square		Annual		Square		Annual
	Feet		Rent		Feet		Rent		Feet		Rent		Feet		Rent
Wholly Owned Properties in Operation:
2008 (9 months)		2,291	$	9,379		844	$	7,908		1,345	$	19,486		4,480	$	36,773
2009		3,355		15,623		1,811		17,004		2,715		39,387		7,881		72,014
2010		3,214		15,461		1,761		16,852		2,892		41,575		7,867		73,888
2011		2,798		12,861		1,155		11,577		2,155		33,211		6,108		57,649
2012		4,635		23,126		1,469		14,349		2,739		43,927		8,843		81,402
2013		1,400		7,478		1,077		11,279		2,221		36,636		4,698		55,393
Thereafter		8,712		46,476		2,168		27,016		5,550		97,253		16,430		170,745

TOTAL		26,405	$	130,404		10,285	$	105,985		19,617	$	311,475		56,307	$	547,864


	Industrial-				Industrial-
	Distribution				Flex				Office				Total
	Square		Annual		Square		Annual		Square		Annual		Square		Annual
	Feet		Rent		Feet		Rent		Feet		Rent		Feet		Rent
Joint Venture Properties in Operation:
2008 (9 months)		593	$	2,460		9	$	305		284	$	6,467		886	$	9,232
2009		1,100		4,350		11		320		544		12,464		1,655		17,134
2010		1,073		4,354		19		733		348		8,356		1,440		13,443
2011		650		2,761		11		374		452		11,489		1,113		14,624
2012		438		1,891		63		2,121		180		5,274		681		9,286
2013		492		2,040		—		—		212		4,315		704		6,355
Thereafter		3,207		16,050		39		1,353		1,959		67,517		5,205		84,920

TOTAL		7,553	$	33,906		152	$	5,206		3,979	$	115,882		11,684	$	154,994


	Industrial-				Industrial-
	Distribution				Flex				Office				Total
	Square		Annual		Square		Annual		Square		Annual		Square		Annual
	Feet		Rent		Feet		Rent		Feet		Rent		Feet		Rent
Properties in Operation:
2008 (9 months)		2,884	$	11,839		853	$	8,213		1,629	$	25,953		5,366	$	46,005
2009		4,455		19,973		1,822		17,324		3,259		51,851		9,536		89,148
2010		4,287		19,815		1,780		17,585		3,240		49,931		9,307		87,331
2011		3,448		15,622		1,166		11,951		2,607		44,700		7,221		72,273
2012		5,073		25,017		1,532		16,470		2,919		49,201		9,524		90,688
2013		1,892		9,518		1,077		11,279		2,433		40,951		5,402		61,748
Thereafter		11,919		62,526		2,207		28,369		7,509		164,770		21,635		255,665

TOTAL		33,958	$	164,310		10,437	$	111,191		23,596	$	427,357		67,991	$	702,858

The Company believes that its existing sources of capital will provide sufficient funds to finance its continued development and acquisition activities. The scheduled deliveries of the 6.5 million square feet of Properties under Development as of March 31, 2008 are as follows (dollars in thousands):


		Square Feet
	Scheduled	Industrial-		Industrial-						Percent			Total
	In-Service Date	Distribution		Flex		Office		Total		Leased			Investment
Wholly Owned Properties under Development	2nd Quarter 2008		149,040		63,600		36,000		248,640		100.0	%	$	17,392
	3rd Quarter 2008		1,451,974		115,600		—		1,567,574		82.3	%		92,858
	4th Quarter 2008		963,540		—		103,700		1,067,240		3.5	%		65,992
	1st Quarter 2009		—		—		90,472		90,472		35.2	%		16,599
	2nd Quarter 2009		1,020,400		194,500		297,768		1,512,668		3.1	%		133,652
	3rd Quarter 2009		554,040		—		298,176		852,216		31.2	%		100,021
	2nd Quarter 2010		—		—		95,261		95,261		38.3	%		24,291

	TOTAL		4,138,994		373,700		921,377		5,434,071		36.0	%	$	450,805

Joint Venture Properties under Development	2nd Quarter 2008		—		—		338,018		338,018		73.5	%	$	141,837
	3rd Quarter 2008		296,100		—		—		296,100		39.5	%		18,309
	3rd Quarter 2009		—		—		176,394		176,394		2.8	%		126,640
	4th Quarter 2009		225,000		—		—		225,000		—			11,675

	TOTAL		521,100		—		514,412		1,035,512		32.9	%	$	298,461

Total Properties under Development	TOTAL		4,660,094		373,700		1,435,789		6,469,583		35.5	%	$	749,266

The Company’s existing sources of capital include the public debt and equity markets, proceeds from dispositions of properties, equity contributions by joint venture partners and net cash provided from operating activities. Additionally, the Company expects to incur variable rate debt, including borrowings under the Credit Facility, from time to time.

The Company has an effective S-3 shelf registration statement on file with the SEC pursuant to which the Trust and the Operating Partnership may issue an unlimited amount of equity securities and debt securities, respectively.

Calculation of Funds from Operations

The National Association of Real Estate Investment Trusts (“NAREIT”) has issued a standard definition for Funds from operations (as defined below). The SEC has agreed to the disclosure of this non-GAAP financial measure on a per share basis in its Release No. 34-47226, Conditions for Use of Non-GAAP Financial Measures. The Company believes that the calculation of Funds from operations is helpful to investors and management as it is a measure of the Company’s operating performance that excludes depreciation and amortization and gains and losses from property dispositions. As a result, year over year comparison of Funds from operations reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses, and interest costs, providing perspective not immediately apparent from net income. In addition, management believes that Funds from operations provides useful information to the investment community about the Company’s financial performance when compared to other REITs since Funds from operations is generally recognized as the standard for reporting the operating performance of a REIT. Funds from operations available to common shareholders is defined by NAREIT as net income (computed in accordance with generally accepted accounting principles (“GAAP”)), excluding gains (or losses) from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Funds from operations available to common shareholders does not represent net income as defined by GAAP and does not necessarily indicate that cash flows will be sufficient to fund cash needs. It should not be considered as an alternative to net income as an indicator of the Company’s operating performance or to cash flows as a measure of liquidity.

Funds from operations (“FFO”) available to common shareholders also does not represent cash flows generated from operating, investing or financing activities as defined by GAAP. Funds from operations

available to common shareholders for the three months ended March 31, 2008 and 2007 are as follows (in thousands, except per share amounts):


	Three Months Ended
	March 31, 2008			March 31, 2007
Reconciliation of net income to FFO — basic

Net Income	$	29,961		$	39,698

Basic — income available to common shareholders		29,961			39,698
*Basic — income available to common shareholders per weighted average share*	$	0.33		$	0.44

Adjustments:
Depreciation and amortization of unconsolidated joint ventures		3,548			841
Depreciation and amortization		43,378			37,927
Gain on property dispositions		(968	)		(3,387	)
Minority interest share in addback for depreciation and amortization and gain on property dispositions		(1,995	)		(1,546	)

Funds from operations available to common shareholders — basic	$	73,924		$	73,533


*Basic Funds from operations available to common shareholders per weighted average share*	$	0.81		$	0.81

Reconciliation of net income to FFO — diluted

Net income	$	29,961		$	39,698

Diluted — income available to common shareholders		29,961			39,698
*Diluted — income available to common shareholders per weighted average share*	$	0.33		$	0.43
Adjustments:
Depreciation and amortization of unconsolidated joint ventures		3,548			841
Depreciation and amortization		43,378			37,927
Gain on property dispositions		(968	)		(3,387	)
Minority interest less preferred share distributions and excess of preferred unit redemption over carrying amount		1,352			1,815


Funds from operations available to common shareholders — diluted	$	77,271		$	76,894


*Diluted Funds from operations available to common shareholders per weighted average share*	$	0.80		$	0.80

Reconciliation of weighted average shares:
Weighted average common shares — all basic calculations		91,715			91,036
Dilutive shares for long term compensation plans		228			982


Diluted shares for net income calculations		91,943			92,018
Weighted average common units		4,190			4,190


Diluted shares for Funds from operations calculations		96,133			96,208

Inflation

Inflation has remained relatively low during the last three years, and as a result, it has not had a significant impact on the Company during this period. The Credit Facility bears interest at variable rates; therefore, the amount of interest payable under the Credit Facility is influenced by changes in short-term interest rates, which tend to be sensitive to inflation. To the extent an increase in inflation would result in increased operating costs, such as in insurance, real estate taxes and utilities, substantially all of the tenants’ leases require the tenants to absorb these costs as part of their rental obligations. In addition, inflation also may have the effect of increasing market rental rates.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

There have been no material changes to the Company’s exposure to market risk since its Annual Report on Form 10-K for the year ended December 31, 2007.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company’s management, with the participation of its Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that its disclosure controls and procedures, as of the end of the period covered by this report, are functioning effectively to provide reasonable assurance that information required to be disclosed by the Company in its reports filed or submitted under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC’s rules and forms and (ii) accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Controls

There were no changes in the Company’s internal control over financial reporting during the quarter ended March 31, 2008 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

The Company has been substituted for Republic as a party to certain litigation as a result of the Company’s acquisition of Republic on October 4, 2007. The litigation arises out of a dispute between Republic and certain parties, two of whom were members of Republic’s Board of Trustees and “founders” of Republic. The dispute includes claims arising from the termination of a development arrangement in West Palm Beach, Florida and an attempt by Republic to acquire a certain office property from an entity controlled by the aforementioned related parties pursuant to an option agreement entered into at the time of Republic’s formation. The litigation has been summarized in previous filings. Material developments in the litigation are summarized below.

As noted in prior filings, on March 28, 2007, Republic filed a lawsuit against Messrs. Kramer and Grigg and Republic Properties Corporation in the United States District Court of the District of Columbia. This lawsuit asserts, among other things, claims against (i) all three defendants for (a) federal and state securities fraud and (b) common law fraud; (ii) Messrs. Kramer and Grigg for (a) federal and state control person liability and (b) unjust enrichment; and (iii) Republic Properties Corporation for (a) breach of contract and (b) indemnification. The Company seeks, among other remedies, (i) damages in an amount not less than $1.2 million, the approximate value (at the time of issuance) of the partnership units issued by Republic Property Limited Partnership to Republic Properties Corporation in connection with the West Palm Beach City Center Development Contribution Agreement, (ii) additional damages incurred by us as a result of the termination of the West Palm Beach Professional Services Agreement, (iii) recovery of the costs, including attorneys fees, associated with a previously-disclosed independent investigation, (iv) reimbursement for Republic’s expenses in this litigation, including attorneys’ fees, and (v) other damages, including punitive damages, in an amount to be finally determined at trial. On April 27, 2007, Republic filed an Amended Complaint in the District of Columbia District Court action, adding to the claims set forth immediately above a claim for declaratory judgment that Mr. Kramer was not entitled to advancement or reimbursement of any of the fees sought in his Maryland litigation. Republic Property Corporation, Messrs. Kramer and Grigg have filed motions to dismiss this lawsuit. On March 31, 2008, the Court granted the motion to dismiss. The Company is preparing a motion for reconsideration of the grant of the motion to dismiss.

As noted in prior filings, on June 15, 2007, Republic filed a lawsuit against 25 Massachusetts Avenue Property, LLC (the “Owner”) of Republic Square I, an office building in Washington, D.C. (the “Option Property”) in the Court of Chancery in the State of Delaware. This lawsuit asserts, among other things, that (i) by refusing to accept Republic’s option exercise the Owner has breached the Option Agreement and (ii) by deciding not to refinance a construction loan on the Property and rejecting the Lease, the Owner has breached the covenant of good faith and fair dealing implied in every contract governed by the laws of the District of Columbia. Republic sought, among other remedies, to obtain (I) an injunction against the Owner’s sale of the Option Property to any party other than Republic, (II) a declaration that the Lease and option exercise are effective and (III) an order that the Owner specifically perform its obligation to sell the Option Property to Republic pursuant to the Option Agreement. Also on June 15, 2007, Republic filed a Notice of Pendency of Action (Lis Pendens) in the Office of the Recorder of Deeds in the District of Columbia, in order to record Republic’s interest in the Option Property as reflected in the Delaware Chancery Court action. On July 2, 2007, the Owner answered the complaint and counterclaimed, seeking monetary damages related to the Owner’s purported attempts to sell the Option Property to a third party. The matter was tried in 2007. On April 7, 2008, the Court issued an opinion concluding that neither party is entitled to relief and ordering that the Lis Pendens be lifted. The Owner has announced its intention to appeal. The Company has not determined whether it will appeal the Court’s ruling.

While management currently believes that resolving these matters will not have a material adverse impact on our financial position or our results of operations, the litigation noted above is subject to inherent uncertainties and management’s view of these matters may change in the future. Were an unfavorable final outcome to occur, there exists the possibility of a material adverse impact on our financial position and the results of operations for the period in which the effect becomes capable of being reasonably estimated.

Item 1A. Risk Factors

There have been no material changes to the risk factors disclosed in Item 1A of Part 1 “Risk Factors,” in our Form 10-K for the year ended December 31, 2007.

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

None.

Item 3. Defaults upon Senior Securities

None.

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

None.

Item 5. Other Information

None.

Item 6. Exhibits


10.1* †		Liberty Property Trust 2008 Long-Term Incentive Plan

10.2* †		Form of Option Grant Agreement under the Liberty Property Trust Amended and Restated Share Incentive Plan.

10.3* †		Form of Restricted Share Unit Grant Agreement under the Liberty Property Trust Amended and Restated Share Incentive Plan.

12.1*		Statement Re: Computation of Ratio of Earnings to Fixed Charges and Ratio of Earnings to Combined Fixed Charges.

31.1*		Certifications of the Chief Executive Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.

31.2*		Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.

31.3*		Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.

31.4*		Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.

32.1*		Certifications of the Chief Executive Officer of Liberty Property Trust required under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)

32.2*		Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)

32.3*		Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)

32.4*		Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)


*		Filed herewith.

†		Compensatory plan or arrangement.

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.


LIBERTY PROPERTY TRUST

/s/ WILLIAM P. HANKOWSKY				May 8, 2008
William P. Hankowsky				Date
President and Chief Executive Officer

/s/ GEORGE J. ALBURGER, JR				May 8, 2008
George J. Alburger, Jr.				Date
Executive Vice President and Chief Financial Officer

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.


LIBERTY PROPERTY LIMITED PARTNERSHIP BY: Liberty Property Trust General Partner


/s/ WILLIAM P. HANKOWSKY				May 8, 2008
William P. Hankowsky				Date
President and Chief Executive Officer

/s/ GEORGE J. ALBURGER, JR				May 8, 2008
George J. Alburger, Jr.				Date
Executive Vice President and Chief Financial Officer

EXHIBIT INDEX


EXHIBIT
NO.		DESCRIPTION
10.1†		Liberty Property Trust 2008 Long Term Incentive Plan

10.2†		Form of Option Grant Agreement under the Liberty Property Trust Amended and Restated Share Incentive Plan.

10.3†		Form of Restricted Share Unit Grant Agreement under the Liberty Property Trust Amended and Restated Share Incentive Plan.

12.1		Statement Re: Computation of Ratio of Earnings to Fixed Charges and Ratio of Earnings to Combined Fixed Charges.

31.1		Certifications of the Chief Executive Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.

31.2		Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(a) under the Securities Exchange Act of 1934.

31.3		Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.

31.4		Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(a) under the Securities Exchange Act of 1934.

32.1		Certifications of the Chief Executive Officer of Liberty Property Trust required under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)

32.2		Certifications of the Chief Financial Officer of Liberty Property Trust required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)

32.3		Certifications of the Chief Executive Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)

32.4		Certifications of the Chief Financial Officer of Liberty Property Trust, in its capacity as the general partner of Liberty Property Limited Partnership, required by Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)


†		Compensatory plan or arrangement.

Exhibit 10.1

LIBERTY PROPERTY TRUST

2008 LONG-TERM INCENTIVE PLAN

EFFECTIVE AS OF JANUARY 1, 2008

TABLE OF CONTENTS


		Page

ARTICLE I INTRODUCTION		1
ARTICLE II DEFINITIONS		2
2.1 “Affiliate”		2
2.2 “Award”		2
2.3 “Award Agreement”		2
2.4 “Award Date”		2
2.5 “Award Period”		2
2.6 “Award Period Target”		2
2.7 “Beneficiary”		2
2.8 “Board”		2
2.9 “Cause”		2
2.10 “CEO”		2
2.11 “Change in Control”		2
2.12 “Code”		2
2.13 “Committee”		2
2.14 “Common Share”		2
2.15 “Company”		3
2.16 “Effective Date”		3
2.17 “Employee”		3
2.18 “Employer”		3
2.19 “Employment Agreement”		3
2.20 “Fair Market Value”		3
2.21 “Measurement Date”		3
2.22 “Options”		3
2.23 “Participant”		3
2.24 “Performance Period”		3
2.25 “Performance Period Target”		3
2.26 “Permanent Disability”		3
2.27 “Plan”		3
2.28 “Plan Year”		3

TABLE OF CONTENTS
(continued)


		Page

2.29 “Redemption Date”		3
2.30 “Retirement”		4
2.31 “Share Incentive Plan”		4
2.32 “Target Units”		4
2.33 “Units”		4
2.34 “Weighted Average Shares Outstanding”		4
ARTICLE III PARTICIPATION		5
3.1 Initial Participants		5
3.2 New Participants		5
ARTICLE IV COMMON SHARES SUBJECT TO THE PLAN		6
4.1 Common Shares Subject to the Plan		6
4.2 Changes in Common Shares or Assets of the Company, Acquisition or Liquidation of the Company and Other Corporate Events		6
ARTICLE V AWARDS		7
5.1 Awards		7
5.2 Options		7
5.3 Target Units		8
ARTICLE VI PERFORMANCE TARGETS		9
6.1 Determination of Performance of the End of the Performance Period and Award Period		9
ARTICLE VII REDEMPTION OF TARGET UNITS; VESTING		10
7.1 Redemption of Target Units at the End of the Award Period		10
ARTICLE VIII TERMINATION OF EMPLOYMENT		11
8.1 Termination for Cause, Voluntary Resignation, or Nonrenewal of Employment Agreement		11
ARTICLE IX ADMINISTRATION		12
9.1 Committee		12
9.2 Committee Authority		12
9.3 Committee Determinations		12
9.4 Compensation of Committee		12

TABLE OF CONTENTS
(CONTINUED)


		Page

9.5 Indemnification of Committee		12
ARTICLE X MISCELLANEOUS		14
10.1 Amendment; Termination		14
10.2 Non-Alienation		14
10.3 Funding		14
10.4 Governing Law		14
10.5 Withholding		15
10.6 At-Will Employment Status		15
10.7 Headings		15
10.8 Enforceability		15
10.9 Successors		15
10.10 Beneficiary		15
10.11 Incorporation of Equity Incentive Plan		15
10.12 Stock Certificates		15
10.13 Gender		16
10.14 Notices		16
10.15 Uniformity		16

iii

LIBERTY PROPERTY TRUST
2008 LONG-TERM INCENTIVE PLAN

ARTICLE I
INTRODUCTION

This Plan is intended to provide additional compensation for executive personnel who contribute materially to the continued growth, development and future business success of the Company. The Plan is a performance-based plan that utilizes (i) time-based vesting with respect to grants of stock options, and (ii) earnings targets based on specific and distinct performance measures over the Performance Period and Award Period as the measurement criteria for determining incentive compensation paid in the form of restricted stock units. The Company believes that the Plan will encourage Participants to contribute materially to the growth of the Company, thereby benefiting the Company’s shareholders, and aligning the economic interests of Participants with those of the shareholders. All capitalized terms used in this Article I shall have the meaning ascribed to them in Article II below.

ARTICLE II
DEFINITIONS

The following terms shall have the following meanings for purposes of the Plan:

2.1 “ Affiliate ” shall mean any entity that directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the Company.

2.2 “ Award ” shall mean the Options and Target Units awarded to a Participant under the Plan.

2.3 “ Award Agreement ” shall mean the individual agreement provided by the Committee to each Participant notifying the Participant of participation in the Plan and specifying the Options and Target Units awarded to the Participant and the other terms and conditions of the Award. By accepting and executing an Award Agreement, each Participant shall be agreeing to be subject to the terms of the Plan and to the discretion of the Committee as set forth in the Plan.

2.4 “ Award Date ” shall mean the date effective as of which an Award is made.

2.5 “ Award Period ” shall mean the three-year period beginning on the Award Date.

2.6 “ Award Period Target ” shall mean the performance measure or set of measures established by the Committee by March 30 of each year with respect to that year’s Award Period Units, if any, in accordance with the requirements of Code Section 162(m).

2.7 “ Beneficiary ” shall mean, on the death of the Participant, his estate, which shall include either the Participant’s probate estate or living trust.

2.8 “ Board ” shall mean the Board of Trustees of the Company.

2.9 “ Cause ” shall mean, unless defined otherwise in a Participant’s Employment Agreement, “Cause” as defined in the Share Incentive Plan.

2.10 “ CEO ” shall mean the Chief Executive Officer of the Company.

2.11 “ Change in Control ” shall mean, unless defined otherwise in a Participant’s Employment Agreement, a “Change of Control” as defined in the Share Incentive Plan.

2.12 “ Code ” shall mean the Internal Revenue Code of 1986, as amended.

2.13 “ Committee ” shall mean the Compensation Committee of the Board or such other committee appointed by the Board for purposes of administering the Plan.

2.14 “ Common Share ” shall mean a common share of beneficial ownership, par value $0.001 per share, of the Company.

2.15 “ Company ” shall mean Liberty Property Trust, a Maryland real estate investment trust or any business organization that succeeds to its business and elects to continue this Plan.

2.16 “ Effective Date ” shall mean January 1, 2008.

2.17 “ Employee ” shall mean any employee of an Employer, whether such employee is so employed at the time this Plan is adopted or becomes so employed subsequent to the adoption of this Plan.

2.18 “ Employer ” shall mean the Company or an Affiliate that employs the Participant.

2.19 “ Employment Agreement ” shall mean the employment agreement entered into between the Employee and the Employer governing the terms of the Employee’s employment with the Employer.

2.20 “ Fair Market Value ” shall mean “Fair Market Value” as defined in the Share Incentive Plan.

2.21 “ Measurement Date ” shall mean December 31 of the last day of (i) the Performance Period, with respect to the Performance Period Units (as defined in Section 5.03 hereof), or (ii) the Award Period, with respect to the Award Period Units (as defined in Section 5.03 hereof), or such other date determined by the Committee in its sole discretion.

2.22 “ Options ” shall mean “Options” as defined in, and issued under, the Share Incentive Plan.

2.23 “ Participant ” shall mean any Employee who has been designated by the Committee as eligible to receive an Award under this Plan.

2.24 “ Performance Period ” shall mean each Plan Year after the Effective Date; provided, however, that with respect to any individual who becomes a Participant in the Plan after the Effective Date, the “Performance Period” shall be the period determined by the Committee in its sole discretion.

2.25 “ Performance Period Target ” shall mean the performance measure or set of measures established by the Committee by March 30 of each year with respect to that year’s Performance Period Units, if any, in accordance with the requirements of Code Section 162(m).

2.26 “ Permanent Disability ” shall mean the Participant’s becoming disabled within the meaning of section 22(e)(3) of the Internal Revenue Code of 1986, as amended.

2.27 “ Plan ” shall mean the Liberty Property Trust 2008 Long-Term Incentive Plan, as embodied herein and as amended from time to time.

2.28 “ Plan Year ” shall mean the calendar year.

2.29 “ Redemption Date ” shall mean the date that all or any portion of the Target Units are redeemed under the Plan.

2.30 “ Retirement ” shall mean “Retirement” as defined in, and subject to the terms and conditions of, the Share Incentive Plan.

2.31 “ Share Incentive Plan ” shall mean the Liberty Property Trust Amended and Restated Share Incentive Plan, as may be amended from time to time, or such other plan maintained by the Company pursuant to which Common Shares granted under the Plan may be issued to Participants.

2.32 “ Target Units ” shall mean the aggregate number of Units awarded to a Participant under the Plan, as described in Section 5.3 of the Plan.

2.33 “ Units ” shall mean phantom rights that will be converted to Common Shares on a Redemption Date if the Award Period Targets or Performance Period Targets specified under the Plan are met. Each Unit shall represent one Common Share.

2.34 “ Weighted Average Shares Outstanding ” shall mean, for any Measurement Date, the weighted average number of Company shares outstanding, as publicly reported by the Company as of such date.

ARTICLE III
PARTICIPATION

3.1 Initial Participants . The Committee shall determine which Employees shall be Participants in the Plan as of the Effective Date and shall provide each individual with an Award Agreement evidencing their participation in the Plan.

3.2 New Participants . At any time after the Effective Date, the Committee may provide that other Employees shall be eligible to participate in the Plan on the terms and conditions that the Committee determines appropriate for such Employee. Any such Employee shall be provided with an individual Award Agreement evidencing their participation in the Plan. Any Employee designated as a Participant in the Plan shall not become a Participant in the Plan until the first day of the Plan Year that first occurs on or after such individual’s designation as a Participant in the Plan.

ARTICLE IV
COMMON SHARES SUBJECT TO THE PLAN

4.1 Common Shares Subject to the Plan . All Common Shares issued under the Plan shall be issued from the Share Incentive Plan. If any Options or Units are forfeited prior to being exercised or redeemed, respectively, the Common Shares corresponding to such Options or Units shall not again be available for issuance under the Plan; provided, however, that if the reason for the forfeiture of the Target Units is because the Participant’s employment with the Employer is (i) terminated by the Employer with Cause, voluntarily terminated by the Participant, or terminated as a result on nonrenewal of the Participant’s Employment Agreement, then any Common Shares corresponding to Options or Units that are forfeited by the Participant as a result of such termination of employment with the Employer shall again be available for issuance under the Plan, or (ii) terminated without Cause, then any Common Shares corresponding to Units for which no exercise redemption can occur shall again be available for issuance under the Plan.

4.2 Changes in Common Shares or Assets of the Company, Acquisition or Liquidation of the Company and Other Corporate Events . If an event described in Section 4(c) of the Share Incentive Plan (or other similar provision of such plan or a successor plan) occurs, then the Committee shall, in such manner as it may deem equitable, adjust (i) the maximum number of Common Shares that may be issued under the Plan, and (ii) the number of Options or Units covered by the Target Unit held by a Participant, in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, to facilitate such transactions or events or to give effect to such changes in laws, regulations or principles.

ARTICLE V
AWARDS

5.1 Awards . Awards under the Plan shall consist of Options and Target Units awarded effective as of the Award Date. All Awards shall be subject to the terms and conditions set forth herein and to such other terms and conditions consistent with the Plan as the Committee deems appropriate and as are specified in writing by the Committee to the individual in the Award Agreement. The Committee may, by way of the Award Agreement or otherwise, establish such terms, conditions, restrictions and/or limitations, if any, of any Award, provided they are not inconsistent with the Plan, including, without limitation, the requirement that the Participant not engage in competition with, solicit customers or employees of, or disclose or use confidential information of the Company or its Affiliates. If at any time the Employee breaches such conditions or otherwise engages in activities that constitute “cause” as defined in the Award Agreement or otherwise, the Award shall terminate, and the Company may rescind any exercise (in the case of an Option) or redemption (in the case of Target Units) and delivery of Common Shares upon such exercise or redemption within one year after the Employee engages in such conduct. In the event of any such rescission, the Employee shall return to the Company the Common Shares received upon the exercise or redemption or, if the Employee no longer owns the Common Shares, the Employee shall pay to the Company the amount of any gain realized or payment received as a result of any sale or other disposition of the Common Shares (or, in the event the Employee transfers the Common Shares by gift or otherwise without consideration, the fair market value of the Common Shares on the date of breach), net of the price originally paid by the Employee for the Common Shares. The payment shall be made in such manner and on such terms and conditions as may be required by the Company. The Company shall be entitled to set off against the amount of any such payment any amounts otherwise owed to the Employee by the Company.

Any Options, Target Units or Common Shares issued under the Plan shall also be subject to the terms and conditions of the Share Incentive Plan (except as otherwise provided herein), including the provisions regarding Code Section 162(m) described in Section 12 of the Share Incentive Plan (it being intended that the Committee shall operate the Plan in accordance with all terms, conditions and restrictions of Code Section 162(m)). The Committee shall approve the form and provisions of the Award Agreement. An Option or Target Unit awarded to one Participant does not mean that the Participant will receive an Option or Target Unit at any other time or that the Participant will receive the same Option or Target Unit in any future Award. An Option or Target Unit awarded to one Employee does not mean that any other Employee will receive an Award of an Option or Target Unit or have the same number of Options or Units subject to such Target Unit.

5.2 Options . Each Participant shall, as part of his Award, be awarded an Option to purchase a specified number of Common Shares, which shall be determined by the Committee, in its sole discretion, and set forth in the Participant’s Award Agreement. Twenty percent of the total number of Common Shares underlying such Option shall become exercisable on the first anniversary of the related date of grant, an additional thirty percent shall become exercisable on the second such anniversary, and the remaining fifty percent shall become exercisable on the third such anniversary. In addition, such Options shall become vested and exercisable in full if the Participant ceases to be employed by, or provide service to, the Employer by reason of death,

Permanent Disability or Retirement, as such terms are defined in, and subject to the provisions of, the Share Incentive Plan.

5.3 Target Units . Each Participant shall, as part of his Award, be awarded a specified number of Units, which shall be determined by the Committee, in its sole discretion, and set forth in the Participant’s Award Agreement. The total number of Units awarded to the Participant shall be such Participant’s Target Unit, a percentage (to be determined by the Committee) of which will be subject to measurement against one performance measure (or set of performance measures) (the “Performance Period Units”), and the remainder of which will be subject to measurement against a different performance measure (or set of performance measures) (the “Award Period Units”). The Target Units shall represent the maximum number of Common Shares that the Participant will receive at the end of the Award Period if the Performance Period and Award Period are met at the end of the Performance Period and Award Period, respectively. A Participant’s Target Units shall be as set forth in the Participant’s Award Agreement, subject to decrease or forfeiture in accordance with the terms of the Plan and as the Committee may, in its sole discretion, decide.

ARTICLE VI

PERFORMANCE TARGETS

6.1 Determination of Performance as of the End of the Performance Period and Award Period . As soon as administratively practicable after the end of the Performance Period and Award Period, the Committee shall determine whether, and the extent to which, the Performance Period Target and Award Period Target, respectively, were met. If they were met or exceeded, the applicable portion of the Participant’s Target Units will be deemed earned as of the related Measurement Date. The Committee shall use objectively determinable performance goals based on one or more of the following criteria: Funds from operations, total shareholder return, share price, earnings per share, net earnings, operating earnings, earnings before income taxes, EBITDA (earnings before income tax expense, interest expense, and depreciation and amortization expense), funds from operations, adjusted funds from operations, certain levels of operating expense, return on assets, shareholder return, return on equity, growth in assets, unit volume, sales or market share, or strategic business criteria consisting of one or more objectives based on meeting specified revenue goals, market penetration goals, geographic business expansion goals, cost targets, goals relating to acquisitions or divestitures, targeted financing or capital market objectives or specified, objective, individual performance goals or metrics.

ARTICLE VII

REDEMPTION OF TARGET UNITS; VESTING

7.1 Redemption of Target Units at the End of the Award Period . As of the end of the Award Period, each Unit earned in accordance with Article VI will be redeemed for one Common Share to the extent that Common Shares are available for issuance under the Equity Incentive Plan at the time of the redemption. No restrictions on transferability of such Common Shares, other than those imposed by the Company on its Common Shares in general and under the Equity Incentive Plan, shall be imposed effective as of such date. Such Common Shares will be transferred to the Participant within the calendar year immediately following the close of such Award Period. Unless otherwise determined by the Committee at the date of grant, cash, Common Shares or other property equal in value to dividends paid with respect to the Common Shares underlying Target Units will be paid when, and to the extent that, such Target Units are redeemed at the end of the Award Period.

ARTICLE VIII

TERMINATION OF EMPLOYMENT

8.1 Termination for Cause, Voluntary Resignation, or Nonrenewal of Employment Agreement . Unless the Committee determines otherwise or as otherwise provided in the Participant’s Employment Agreement, if a Participant’s employment with an Employer is terminated by the Employer on account of Cause, voluntarily by the Participant for any reason, or the Participant’s Employment Agreement terminates without renewal and the Participant’s employment with the Employer terminates as a result of such nonrenewal, the portion of the Participant’s Options and Target Units that has not vested and been exercised or redeemed, respectively, will be forfeited. If the termination occurs prior to the applicable Redemption Date, no Units shall be redeemed for the Participant.

8.1.1 Termination for Retirement, Death, or Permanent Disability . Unless the Committee determines otherwise or as otherwise provided in the Participant’s Employment Agreement, if a Participant’s employment with an Employer is terminated on account of death or by the Employer on account of Permanent Disability, or if the Participant terminates on account of Retirement, then all Options and Target Units shall become fully vested at the time of such termination. The Participant shall be eligible to exercise such Options, and the Participant’s Target Units shall be redeemed in accordance with the terms of the Plan, as if the Participant continued in employment with the Employer for the remainder of the Performance Period or Award Period, as applicable.

8.1.2 Change in Control . [In the event of a Change in Control, the Committee may take whatever action it deems necessary or desirable, in accordance with Section 16 of the Share Incentive Plan.]

ARTICLE IX
ADMINISTRATION

9.1 Committee . This Plan shall be administered by the Committee. The Committee may delegate authority to one or more subcommittees, as it deems appropriate. The Committee may also delegate ministerial duties to Employees of an Employer or other persons it deems appropriate and capable of fulfilling such ministerial duties.

9.2 Committee Authority . The Committee shall have the sole authority to (i) determine which Employees shall be Participants, (ii) determine the Performance Period and Award Period for a Participant, (iii) determine the total number of Units that are subject to the Participant’s Target Unit, (iv) determine the Performance Period Target and Award Period Target, (vi) amend any previously granted Award or Award Agreement, subject to the limitations under Section 11.1, (vii) determine the Redemption Date, and (viii) deal with any matters arising under the Plan. Notwithstanding the preceding sentence, the Committee may consider the recommendations of the CEO as such recommendations relate to determining which Employees, other than himself, shall receive Awards under the Plan, the total number of Options and the total number of Units subject to the Participant’s Target Unit, determine the Performance Period Target and Award Period Target for such Participant, and the consequences of such Participant’s termination of employment on his outstanding Options and Target Units.

9.3 Committee Determinations . The Committee shall have all powers necessary to administer and interpret the Plan, to make factual determinations and to adopt or amend such rules, regulations, agreements and instruments for implementing the Plan and for the conduct of its business as it deems necessary or advisable, in its sole discretion. The Committee’s interpretations, constructions and determinations shall be final, binding and conclusive on all parties, including but not limited to the Employers and any Employee or Participant. As a condition of participating in the Plan and receiving an Award, a Participant must acknowledge, in writing or by acceptance of an Award, that all decisions and determinations of the Committee shall be final and binding on the Participant, his or her Beneficiaries and any other person having or claiming an interest under such Award. All powers of the Committee shall be executed in its sole discretion, in the best interest of the Company, not as a fiduciary, and in keeping with the objectives of the Plan and need not be uniform as to similarly situated individuals.

9.4 Compensation of Committee . The Committee shall receive for its services hereunder only the compensation to which its members are otherwise entitled for the service as members of the Board. The Committee is authorized at the expense of the Company to employ such legal counsel, as it may deem advisable to assist in the performance of its duties hereunder. Expenses and fees in connection with the administration of the Plan shall be paid by the Company.

9.5 Indemnification of Committee . To the extent permitted by applicable state law, the Company shall indemnify and hold harmless the members of the Committee, the CEO, and any delegate who is an Employee of an Employer, against any and all expenses, liabilities and claims, including legal fees, to defend against such liabilities and claims arising out of their discharge in good faith of responsibilities under or incident to the Plan, other than expenses and

liabilities arising out of gross negligence or willful misconduct. This indemnity shall not preclude such further indemnities as may be available under insurance purchased by the Company or provided by the Company under any bylaw, agreement or otherwise, as such indemnities are permitted under state law.

ARTICLE X
MISCELLANEOUS

10.1 Amendment; Termination . This Plan, any Award and any Award Agreement may be amended or modified only with the consent of the Company acting through the Committee; provided, that any amendment or modification which adversely affects a Participant must be consented to by such Participant to be effective against him, unless such amendment or modification to the Plan occurs prior to the Effective Date and, in such a case, no consent of the Participant is required for such amendment or modification. Notwithstanding anything in the Plan to the contrary, while the Plan is not intended to be a deferred compensation plan subject to the requirements of section 409A of the Code, if it is subsequently determined that the Plan is subject to the requirements of section 409A of the Code, the Committee may, without the consent of Participants in the Plan, amend the Plan and outstanding Award Agreements to comply with the requirements of section 409A of the Code and any corresponding guidance and regulations issued under section 409A of the Code. This Plan shall terminate, automatically and without further action of the Company, upon the full satisfaction of all of the Company’s obligations hereunder.

10.2 Non-Alienation . The Company shall pay all amounts payable hereunder only to the person or persons designated by the Plan and not to any other person or corporation. No part of a Participant’s Award hereunder shall be liable for the debts, contracts, or engagements of such Participant, nor shall a Participant’s Award be subject to execution by levy, attachment, or garnishment or by any other legal or equitable proceeding (including, but not limited to, an action for a divorce or legal separation), nor shall any such person have any right to alienate, anticipate, sell, transfer, commute, pledge, encumber, or assign any benefits or payments hereunder in any manner whatsoever. If any Participant is adjudicated bankrupt or purports to anticipate, alienate, sell, transfer, commute, assign, pledge, encumber or charge any distribution or payment from the Plan, voluntarily or involuntarily, the Committee, in its sole discretion, may cancel such redemption (or any part thereof) to or for the benefit of such Participant in such manner as the Committee shall direct.

10.3 Funding . The Plan is intended to be a bonus plan and is not intended to be a plan covered by the Employee Retirement Income Security Act of 1974, as amended. The Company shall not be required to set aside any funds for payment of amounts hereunder. Participants and their Beneficiaries, heirs, successors, and assigns shall have no legal or equitable rights, claims, or interests in any specific property or assets of the Company. No assets of the Company shall be held in any way as collateral security for the fulfilling of the obligations of the Company under this Plan. Any and all of the Company’s assets shall be, and remain, the general unpledged, unrestricted assets of the Company. The Company’s obligation under the Plan shall be merely that of an unfunded and unsecured promise of the Company to distribute Common Shares in the future, and the rights of Participants and their Beneficiaries shall be no greater than those of unsecured general creditors.

10.4 Governing Law . The Plan is established under and will be construed according to the laws of the Commonwealth of Pennsylvania, excluding conflict of law provisions.

10.5 Withholding . The redemption and/or vesting of Awards under the Plan shall constitute taxable compensation to the Participant and shall be subject to federal (including FICA), state and local income tax reporting and withholding. In addition, each Participant shall be responsible for the payment of all individual tax liabilities relating to such redemption and/or vesting. The Employer may require that the Participant or the Beneficiary to pay to the Employer the amount of any federal, state or local taxes that the Employer is required to withhold with respect to the redemption and/or vesting of Awards, or the Employer may deduct from other wages paid by the Employer the amount of any withholding taxes due with respect to such redemption and/or vesting. If permitted by the Committee, a Participant may elect to satisfy the Employer’s withholding obligation with respect to the redemption and/or vesting of an Award under the Plan by having Common Shares withheld up to an amount that does not exceed the Participant’s minimum applicable withholding tax rate for federal (including FICA), state and local tax liabilities. The election must be in a form and manner prescribed by the Committee, may be subject to prior approval of the Committee, and no Earned Shares may be withheld for this purpose.

10.6 At-Will Employment Status . The terms and conditions of this Plan shall not be deemed to constitute a contract of employment between the Company or the Employer and the Participant. Such employment continues to be an “at will” employment relationship that can be terminated at any time for any reason, or no reason, with or without cause, and with or without notice, unless otherwise expressly provided for in the Participant’s Employment Agreement. Nothing in this Plan shall be deemed to give a Participant the right to be retained in the service of the Company or the Employer, or to interfere in any way with any right of the Company or the Employer to discipline or discharge the Participant at any time, subject to the terms of the Participant’s Employment Agreement.

10.7 Headings . The headings of Articles are for convenience only and shall not control or affect the meaning or construction of any of the provisions of this Plan.

10.8 Enforceability . In case any provision of this Plan shall be illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining parts hereof, and this Plan shall be construed and enforced as if such illegal or invalid provision had never been included herein.

10.9 Successors . The provisions of this Plan shall bind and inure to the benefit of the Company and its successors and assigns and the Participants and their Beneficiaries. No other person shall be a third-party beneficiary or acquire any rights under this Plan.

10.10 Beneficiary . Any payments payable to a Participant following the Participant’s death shall be payable to the Participant’s Beneficiary.

10.11 Incorporation of Equity Incentive Plan . The provisions of the Equity Incentive Plan are hereby incorporated by reference as set forth herein with respect to Common Shares awarded under the Plan.

10.12 Stock Certificates .

10.12.1 Stock Certificate . On the Redemption Date or as soon as practicable thereafter, the Company shall issue a stock certificate to each Participant receiving Common Shares hereunder. Each such certificate shall be registered in the name of the appropriate Participant. The certificates issued hereunder shall bear a legend referring to the terms, conditions and restrictions applicable to such Common Shares hereunder.

10.13 Gender . The masculine gender shall include the feminine and the singular the plural, unless the context clearly requires otherwise.

10.14 Notices . Any notice or filing required or permitted to be given to the Committee under the Plan shall be sufficient if in writing or hand delivered, or sent by registered or certified mail to the Committee. Any notice to the Participant shall be sent to the last known address of the Participant on the Employer’s records or hand delivered to the Participant. Any such notices shall be deemed given as of the date of delivery, or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification.

10.15 Uniformity . Nothing herein shall be construed as requiring that amounts distributable under the Plan be the same with respect to each Participant.

Exhibit 10.2

LIBERTY PROPERTY TRUST

STOCK OPTION

THIS STOCK OPTION (the “Option”) is granted as of this day of , 200___by LIBERTY PROPERTY TRUST, a Maryland real estate investment trust (the “Company”), to «Optionee», (the “Optionee”).

W I T N E S S E T H:

1. Grant . The Company hereby grants to the Optionee an Option to purchase on the terms and conditions hereinafter set forth all or any part of an aggregate of shares of the Company’s common shares of beneficial interest, $.001 par value per share (the “Option Shares”) at the purchase price of $ per share (the “Option Price”). This Option is intended to be an “incentive stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”) to the extent permitted under the Code. To the extent that this Option is exercisable for the first time during any calendar year with respect to Option Shares having a value (determined using as the per share value the fair market value of an Option Share on the date hereof) in excess of $100,000, or to the extent this Option is exercised after the period provided for the exercise of “incentive stock options” under the Code, this Option shall be treated as an option which is not an “incentive stock option.” This Option is granted pursuant to the Liberty Property Trust Amended and Restated Share Incentive Plan (the “Plan”).

2. Term .

(a) General Rule . The Option granted hereunder shall become exercisable with respect to (1) up to twenty percent (20%) of the Option Shares after the first anniversary of the date hereof, (2) up to fifty percent (50%) of the Option Shares after the second anniversary of the date hereof, and (3) one hundred percent (100%) of the Option Shares after the third anniversary of the date hereof. Notwithstanding, the preceding sentence, upon the Optionee’s termination of services or employment with the Company or an Affiliate as a result of the Optionee’s death, Disability (as defined in the Plan), any portion of the Option that is not otherwise exercisable shall become exercisable upon the date of such termination of services or employment with the Company or an Affiliate. The Option granted hereunder shall terminate in all events at 5:00 p.m. local Philadelphia, Pennsylvania time ten years from the date hereof, unless sooner terminated under subsection 2(e) below.

The Board of Trustees in its administrative capacity with respect to the Plan or, if so designated, any committee designated by the Board of Trustees to administer the Plan with respect to persons including Optionee is referred to in this Option as the “Committee”.

(b) Retirement.

(i) Notwithstanding subsection 2(a) above, and subject to subsection 2(c) below, in the event the Optionee terminates employment or service with the Company or an Affiliate, other than as a result of Optionee’s death or Disability, after the Optionee has attained age 55 or 56, with at least 10 years of employment or service

for the Company or an Affiliate, at a time when the Option granted pursuant to this Award is not fully exercisable under Section 2(a) above, the portion of the Option that would have become exercisable within the 12 month period after the Optionee’s termination of employment or service with the Company or an Affiliate shall become exercisable as of the date of the Optionee’s termination of employment or service with the Company or an Affiliate.

(ii) Notwithstanding subsection 2(a) above, and subject to subsection 2(c) below, in the event the Optionee terminates employment or service with the Company or an Affiliate other than as a result of Optionee’s death or Disability after the Optionee has attained age 57 or 58, with at least 8 years of employment or service for the Company or an Affiliate or attained age 59 or 60, with at least 6 years of employment or service for the Company or an affiliate, at a time when the Option granted pursuant to this Award is not fully exercisable under Section 2(a) above, the portion of the Option that would have become exercisable within the 24 month period after the Optionee’s termination of employment or service with the Company or an Affiliate shall become exercisable as of the date of the Optionee’s termination of employment or service with the Company or an Affiliate.

(iii) Notwithstanding subsection 2(a) above, and subject to subsection 2(c) below, in the event the Optionee terminates employment or service with the Company or an Affiliate other than as a result of Optionee’s death or Disability after the Optionee has attained age 61 or 62, with at least 4 years of employment or service for the Company or an Affiliate, or attained age 63 or 64, with at least 2 years of employment or service for the Company or an Affiliate at a time when the Option

granted pursuant to this Award is not fully exercisable under Section 2(a) above, the portion of the Option that would have become exercisable within the 36 month period after the Optionee’s termination of employment or service with the Company or an Affiliate shall become exercisable as of the date of the Optionee’s termination of employment or service with the Company or an Affiliate.

(iv) Notwithstanding subsection 2(a) above, and subject to subsection 2(c) below, in the event the Optionee terminates employment or service with the Company or an Affiliate other than as a result of Optionee’s death or Disability after the Optionee has attained age 65 or older, with at least one year of employment or service for the Company, at a time when the Option granted pursuant to this Award is not fully exercisable under Section 2(a) above, this Award shall become fully exercisable as of the date of the Optionee’s termination of employment or service with the Company or an Affiliate.

(c) Good Faith Retirement Determination . In order for the accelerated vesting referred to in subsections 2(b)(i)-(iv) above to occur upon the termination of employment or service of the Optionee with the Company or an Affiliate other than as a result of Optionee’s death or Disability, the Committee must make an determination, evidenced by an affirmative action on the part of the Committee, that such termination of employment or service constitutes termination of employment or other active for-profit service that is undertaken in good faith by the Optionee, meaning, among other factors that may be taken into account in the sole discretion of the Committee, that the termination of employment or service is determined by the Committee, in its sole discretion, (A) not to be materially detrimental to the business interests of the Company;

(B) not to result in a violation of any obligations of the Optionee to the Company; and (C) to be motivated by the Optionee’s intention, following such termination, to cease working on a full time basis, for the Company or any other employer, or to provide any services, whether on a consulting, independent contractor, employee or other basis to any entity engaged in the business of owning, operating or developing commercial real estate. Absent such an affirmative action on the part of the Committee, the accelerated vesting referred to in subsections 2(b)(i)-(iv) above shall not occur.

(d) Change of Control . Notwithstanding the foregoing, in the event there is a Change of Control while the Optionee is employed by, or in the service of, the Company or an Affiliate and subsequently Optionee’s service or employment is terminated by the Company other than “for cause” within two years following a Change of Control, any portion of the Option that is not otherwise exercisable shall become exercisable upon the date of such termination of employment or service with the Company or an Affiliate.

(e) Early Termination of Options . Notwithstanding the provisions of subsection 2 (a), all right to exercise this Option shall terminate upon the first to occur of the following:

(i) The third month anniversary of the date of termination of the Optionee’s services or employment with the Company or an Affiliate for any reason other than death, Disability or Retirement,

(ii) The thirty-sixth month anniversary of the date of termination of the Optionee’s services or employment with the Company or an Affiliate on account of

death, Disability or Retirement. Any Option not exercised within the one (1) year period after the date of termination of the Optionee’s services or employment with the Company or an Affiliate due to a Disability shall be treated as a Non-Qualified Option. Any Option not exercised within the three month anniversary date after the termination of the Optionee’s services or employment with the Company or an Affiliate on accont of Retirement shall be treated as a Non-Qualified Option.

(iii) A finding by the Committee, after full consideration of the facts presented on behalf of both the Company and the Optionee, that the Optionee has breached his or her employment or service contract with the Company or an Affiliate, or has been engaged in disloyalty to the Company or an Affiliate, including, without limitation, fraud, embezzlement, theft, commission of a felony or proven dishonesty in the course of his or her employment or service, or has disclosed trade secrets or confidential information of the Company or an Affiliate. In such event, in addition to immediate termination of the Option, the Optionee shall automatically forfeit all Shares for which the Company has not yet delivered the Share certificates upon refund by the Company of the Option Price. Notwithstanding anything herein to the contrary, the Company may withhold delivery of Share certificates pending the resolution of any inquiry that could lead to a finding resulting in a forfeiture.

(iv) The date, if any, set by the Board of Trustees as an accelerated expiration date in the event of the liquidation or dissolution of the Company.

3. Transfers . This Option is not transferable by the Optionee otherwise than by will or pursuant to the laws of descent and distribution in the event of the Optionee’s death (in which event the Option may be exercised by the heirs or legal representatives of the Optionee). Except as expressly set forth above in this Section 3, the Option may be exercised during the lifetime of the Optionee only by the Optionee. Any attempt at assignment, transfer, pledge or disposition of the Option contrary to the provisions

hereof or the levy of any execution, attachment or similar process upon the Option other than as expressly set forth above in this Section 3 shall be null and void and without effect. Any exercise of the Option by a person other than the Optionee shall be accompanied by appropriate proofs of the right of such person to exercise the Option.

4. Method of Exercise and Payment . When exercisable under Section 2, the Option may be exercised by written notice to the Company’s Treasurer specifying the number of Option Shares to be purchased and, unless the Option Shares are covered by a then current registration statement or a Notification under Regulation A under the Securities Act of 1933 (the “Act”), containing the Optionee’s acknowledgment in form and substance satisfactory to the Company, that the Optionee (a) is purchasing such Option Shares for investment and not for distribution or resale (other than a distribution or resale which, in the opinion of counsel satisfactory to the Company, may be made without violating the registration provisions of the Act), (b) has been advised and understands that (i) the Option Shares have not been registered under the Act and are “restricted securities” within the meaning of Rule 144 under the Act and are subject to restrictions on transfer and (ii) the Company is under no obligation to register the Option Shares under the Act or to take any action which would make available to the Optionee any exemption from such registration, (c) has been advised and understands that such Option Shares may not be transferred without compliance with all applicable federal and state securities laws, and (d) has been advised and understands that an appropriate legend referring to the restrictions contained in this Option may be endorsed on the certificate. The notice shall be accompanied by payment of the aggregate Option Price of the Option Shares being purchased (a) in cash, (b) by certified or cashier’s check payable to the order of the Company, (c) subject to the terms of the Plan (including without limitation, Section 15 of the Plan) by payment through a broker in accordance with procedures permitted by Regulation T of the Federal Reserve Board or (d) by such

other mode of payment as the Board may approve. Such exercise shall be effective upon the actual receipt by the Company’s Treasurer of such written notice and payment. In addition, except as provided below, the Optionee may make payment in whole or in part in common shares of beneficial interest in the Company. If payment is made in whole or in part in such shares, then the Optionee shall deliver to the Company certificates registered in the name of the Optionee representing such shares legally and beneficially owned by the Optionee, free of all liens, claims and encumbrances of every kind and having a fair market value (as determined under the Plan) on the date of delivery that is at least as great as the Option Price of the Option Shares with respect to which this Option is to be exercised by payment in such shares, accompanied by powers duly endorsed in blank by the Optionee. Notwithstanding the foregoing, the Committee, in its sole discretion, may refuse to accept Shares in payment of the Option Price or may impose such other limitations and prohibitions on the use of shares of beneficial interest in the Company to exercise this Option as it deems appropriate. In the event the Committee refuses to accept Shares in payment of the Option Price, any certificates representing Shares which were delivered to the Company shall be returned to the Optionee with notice of the refusal of the Committee to accept such shares in payment of the Option Price.

5. Adjustments on Changes in Capitalization . In the event that the outstanding shares of beneficial interest in the Company are changed by reason of a reorganization, merger, consolidation, recapitalization, reclassification, stock split-up, combination or exchange of shares and the like (not including the issuance of shares on the conversion of other securities of the Company which are outstanding on the date of grant and which are convertible into such shares) or dividends payable in such shares, an equitable adjustment shall be made in the number of Shares and price per Share subject to this Option in accordance with the applicable provisions of the Plan.

6. Legal Requirements . If the listing, inclusion, registration or qualification of the Option Shares upon any securities exchange, in any automated quotation system, or under any federal or state law, or the consent or approval of any governmental regulatory body is necessary as a condition of or in connection with the purchase of any Option Shares, the Company shall not be obligated to issue or deliver the certificates representing the Option Shares as to which this Option has been exercised unless and until such listing, inclusion, registration, qualification, consent or approval shall have been effected or obtained. If registration is considered unnecessary by the Company, the Company may cause a legend to be placed on the Option Shares being issued calling attention to their having been acquired for investment and not having been registered.

7. Plan Provisions; Administration . This Option has been granted pursuant to and is subject to the terms and provisions of the Plan. Subject to the provisions of the Plan, all questions of interpretation and application of the Plan and this Option shall be determined by the Committee. The Committee determination shall be final, binding and conclusive.

8. Notices . Any notice to be given to the Company shall be in writing and shall be addressed to the Treasurer of the Company at its principal executive office, and any notice to be given to the Optionee shall be addressed to the Optionee at the address then appearing in the records of the Company or the Affiliate of the Company relating to addresses of members of the Board or at such other address as either party hereafter may designate in writing to the other. Except as otherwise set forth herein, any such notice shall be deemed to have been duly given, made and received only when personally delivered, or on the day delivery is guaranteed when transmitted, addressed as aforesaid, to a third party company or governmental entity providing delivery services in the ordinary course of business, or two days following the day when deposited in the

United States mails, by registered or certified mail, postage prepaid, return receipt requested, addressed as aforesaid. Notwithstanding the foregoing, any notice of exercise pursuant to Section 4 shall be deemed to have been duly given, made or received only upon actual receipt by, or upon tender of delivery to, the addressee of such notice.

9. No Commitment to Retain . Nothing herein contained shall affect the right of the Company or any Affiliate to terminate the Optionee’s services, responsibilities, duties, or authority to represent the Company or any Affiliate at any time for any reason whatsoever.

10. Amendment . The Board of Trustees of the Company shall have the right to amend this Option, subject to the Optionee’s consent if such amendment is not favorable to the Optionee, except that the consent of the Optionee shall not be required for any amendment made under Subsection 8(e) (i) (E) or Section 10 of the Plan.

11. Withholding of Taxes . Whenever the Company proposes or is required to deliver or transfer Option Shares in connection with the exercise of this Option, the Company shall have the right to (a) require the Optionee to remit to the Company an amount sufficient to satisfy any federal, state and/or local withholding tax requirements prior to the delivery or transfer of any certificate or certificates for such Option Shares or (b) take whatever action it deems necessary to protect its interests with respect to tax liabilities.

12. Notification of Company Upon Early Disposition of Option Shares . If, following the exercise of this Option in whole or in part, the Optionee disposes of any Option Shares within two years from the date of grant of this Option or within one year after the transfer of the Option Shares to the Optionee, the Optionee shall give notice in writing to the Committee of such disposition and shall provide the Committee with such other information as the Committee may reasonably request.

IN WITNESS WHEREOF , the Company has granted this Option on the day and year first above written.


	LIBERTY PROPERTY TRUST
	By:
		William P. Hankowsky
		President and Chief Executive Officer

	ACKNOWLEDGED:
	By:
	Optionee: «Optionee»

Exhibit 10.3

[Performance-based Vesting]

LIBERTY PROPERTY TRUST

2008 LONG TERM INCENTIVE PLAN

TARGET UNIT AWARD AGREEMENT

This TARGET UNIT AWARD AGREEMENT (the “Award Agreement”), dated as of __ __, 20___ (the “Award Date”) is delivered by Liberty Property Trust., a Maryland real estate investment trust (the “Company”) to ___(the “Participant”).

RECITALS

A. The Liberty Property Trust 2008 Long Term Incentive Plan (the “Plan”) provides for the grant of Target Units.

B. The Compensation Committee of the Board of Directors (the “Committee”) has decided to make a Target Unit Award to the Participant as an inducement for the Participant to promote the best interests of the Company and its shareholders. The Participant may receive a copy of the Plan by contacting ___, at ___.

NOW, THEREFORE, the parties to this Award, intending to be legally bound hereby, agree as follows:

1. Grant of Target Units . Subject to the terms and conditions set forth in this Award Agreement, the Company hereby grants to the Participant up to an aggregate maximum of___units (the “Target Units”), based on the achievement of the performance goals established by the Committee and set forth on the attached Exhibit A (the “Performance Goals”). Each Target Unit shall be a phantom right and shall be equivalent to one common share of beneficial ownership, par value $0.001 per share, of the Company (the “Common Share”) on the Redemption Date (as defined below). The Target Units granted hereunder are intended to qualify as “qualified performance-based compensation” under section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”). The number of Target Units set forth in this Paragraph 1 is the maximum number of Common Shares payable under this Award Agreement. The actual number of Common Shares that may be paid to the Participant pursuant to this Award Agreement will depend on whether the Performance Goals are achieved and the satisfaction of other conditions as set forth below. The Committee shall not have discretion to increase the number of Common Shares payable based upon achievement of the Performance Goals, but the Committee may reduce the number of Common Shares that are payable based upon the Committee’s assessment.

2. Target Unit Account . The Company shall establish and maintain a Target Unit account as a bookkeeping account on its records (the “Target Unit Account”) for the Participant and shall record in such Target Unit Account the number of Target Units granted to the Participant. The

Participant shall not have any interest in any fund or specific assets of the Company by reason of this grant or the Target Unit Account established for the Participant.

3. Vesting .

(a) Except as provided in subparagraph (b) below, in order to become vested in the Target Units, the Participant must continue to be employed by, or providing service to the Employer (as defined in the Plan) from the Award Date through the Redemption Date; provided however, that the number of Target Units that shall become vested shall be determined based on satisfaction of the Performance Goals. No vesting of the Target Units shall occur until the Committee has certified the level of achievement of the Performance Goals, which certification shall occur as soon as administratively practicable after the end of the applicable performance period, but not later than sixty (60) days following the end of the applicable performance period (the “Certification Date”). Any portion of the Target Units that do not become vested because of the failure to fully satisfy the Performance Goals shall be forfeited as of the Certification Date and the Participant shall have no rights with respect to redemption of the portion of the Target Units that have become forfeited.

(b) Except as provided in subparagraph (c) below, if at any time prior to the Certification Date the Participant’s employment or service with the Employer terminates for any reason other than death, Disability (as defined in the Plan) or Retirement (as defined in the Plan), all of the Target Units subject to this Award Agreement will be immediately forfeited and the Participant shall have no rights with respect to the redemption of any portion of the Target Units.

(c) Notwithstanding any provision to the contrary herein, if the Participant’s employment or service with the Company is terminated on account of the Participant’s death, Disability or Retirement, the Participant shall continue to earn the Target Units based on the level of achievement of the Performance Goals as certified by the Committee, and shall receive payment of the Target Units as set forth herein. In order for the Participant to continue to earn the Target Units following the Participant’s termination of employment or service on account of Retirement as set forth in this subparagraph (c), the Committee must make a determination, evidenced by an affirmative action on the part of the Committee, that such termination of employment or service constitutes termination of employment or other active for-profit service that is undertaken in good faith by the Participant, meaning, among other factors that may be taken into account in the sole discretion of the Committee, that the termination of employment or service is determined by the Committee, in its sole discretion, (i) not to be materially detrimental to the business interests of the Company, (ii) not to result in a violation of any obligations of the Participant to the Company, and (iii) to be motivated by the Participant’s intention, following such termination, to cease working on a full-time basis, for the Company or any other employer, or to provide services, whether on a consulting, independent contractor, employee or other basis to any entity engaged in the business of owning, operating or developing commercial real estate. Absent such an affirmative action on the part of the Committee, the vesting of the Target Units referred to in this subparagraph (c) shall not occur.

4. Redemption . The Target Units shall be redeemed by the Company on the Certification Date or as soon as administratively practicable thereafter, but not later than thirty (30) days following the Certification Date (the “Redemption Date”). On the Redemption Date, all Target

Units that have vested will be redeemed and converted to an equivalent number of Common Shares, and the Participant shall receive a single sum distribution of the Common Shares, which shall be issued under the Company’s Share Incentive Plan (as defined in the Plan) (or a successor plan thereto). All redemptions pursuant to this Award Agreement and the Plan shall be deemed a separate payment for purposes of section 409A of the Code.

5. Dividend Equivalents . Unless otherwise determined by the Committee, cash, Common Shares or other property equal in value to the dividends paid with respect to the Common Shares underlying the Target Units (the “Dividend Equivalents”) shall be payable subject to the same Performance Goals and terms as the Target Units to which they relate. Dividend Equivalents shall be credited with respect to the Target Units to the Participant’s Target Unit Account from the Award Date until the Redemption Date. If and to the extent that the Target Units are forfeited, all related Dividend Equivalents shall also be forfeited. In no event shall the Participant accrue more than $___of such Dividend Equivalents during any calendar year.

6. Non-Transferability of Target Unit Award . No Target Units or Dividend Equivalents awarded to the Participant under this Award Agreement may be transferred, assigned,pledged, encumber or exercised by the Participant and a Target Unit shall be redeemed and a Dividend Equivalent distributed during the Participant’s lifetime only for the benefit of the Participant . Any attempt to transfer, assign, pledge, or encumber the Target Units or Dividend Equivalent by the Participant shall be null, void and without effect.

7. No Rights as Shareholder . The Participant shall not have any rights as a shareholder of the Company, including the right to any cash dividends (except as provided in Paragraph 5), or the right to vote, with respect to any Target Units.

8. Change of Control . The provisions set forth in the Plan applicable to a Change in Control (as defined in the Plan) shall apply to the Target Units. In the event of a Change in Control, the Committee may take such actions as it deems appropriate in accordance with the terms of the Plan and consistent with the requirements of section 409A of the Code.

9. Incorporation by Reference; Definitions . This Award Agreement shall be subject to the terms, conditions and limitations of the Plan, which are incorporated herein by reference, and in all respects shall be interpreted in accordance with the Plan. In the event of any contradiction, distinction or difference between this Award Agreement and the terms of the Plan, the terms of the Plan will control. Except as otherwise defined in this Award Agreement, the terms used in this Award Agreement shall have the meanings set forth in the Plan. The grant is subject to the interpretations, regulations and determinations concerning the Plan established from time to time by the Committee in accordance with the provisions of the Plan. The Committee shall have the authority to interpret and construe the grant pursuant to the terms of the Plan, its decisions shall be conclusive as to any questions arising hereunder, and the Participant’s acceptance of this grant is the Participant’s agreement to be bound by the interpretations and decisions of the Committee with respect to this grant and the Plan

10. Restrictions on Issuance or Transfer of Shares of Common Stock .

(a) The obligation of the Company to deliver Common Shares upon the redemption of the Target Units shall be subject to the condition that if at any time the Committee shall determine in its discretion that the listing, registration or qualification of the Common Shares upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the issue of Common Shares, the Common Shares may not be issued in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Committee. The issuance of the shares of Common Shares to the Participant on the Redemption Date and the payment of cash to the Participant pursuant to this grant is subject to any applicable taxes and other laws or regulations of the United States or of any state having jurisdiction thereof.

(b) As a condition to receive any Common Shares on the Redemption Date, the Participant agrees to be bound by the Company’s policies regarding the transfer of the Common Shares and understands that there may be certain times during the year in which the Participant will be prohibited from selling, transferring, pledging, donating, assigning, mortgaging, hypothecating or otherwise encumbering the Common Shares.

(c) On, or as soon as administratively practicable following the Redemption Date, a certificate representing the Common Shares that are redeemed shall be issued to the Participant.

11. Withholding . The Participant is required to pay to the Company, or make other arrangements satisfactory to the Employer to provide for the payment of, any federal, state, local or other taxes that the Employer is required to withhold with respect to the grant, vesting or redemption/distribution of the Target Units and Dividend Equivalents. Subject to Committee approval, the Participant may elect to satisfy any tax withholding obligation of the Company with respect to the redemption of the Target Units by having Common Shares withheld up to an amount that does not exceed the minimum applicable withholding tax rate for federal (including FICA), state, local and other tax liabilities.

12. No Rights to Continued Employment or Service . The terms and conditions of this Award Agreement shall not be deemed to constitute a contract of employment between the Company or the Employer and the Participant. Such employment continues to be an “at will” employment relationship that can be terminated at any time for any reason, or no reason, with or without Cause (as defined in the Plan), and with or without notice, unless otherwise expressly provided for in the Participant’s Employment Agreement (as defined in the Plan). Nothing in this Award Agreement shall be deemed to give a Participant the right to be retained in the service of the Company or the Employer, or to interfere in any way with any right of the Company or the Employer to discipline or discharge the Participant at any time, subject to the terms of the Participant’s Employment Agreement (if applicable).

13. Assignment by the Company . The rights and protections of the Company hereunder shall extend to any successors or assigns of the Company and to the Company’s parents, subsidiaries, and affiliates. This grant may be assigned by the Company without the Participant’s consent.

14. Acknowledgment . By executing this Award Agreement, the Participant hereby acknowledges that with respect to any right to payment pursuant to this grant, the Participant is

and shall be an unsecured general creditor of the Company without any preference as against other unsecured general creditors of the Company, and the Participant hereby covenants for the Participant, and anyone at any time claiming through or under the Participant not to claim any such preference, and hereby disclaims and waives any such preference which may at any time be at issue, to the fullest extent permitted by applicable law.

15. Application of Section 409A . This Award Agreement is not intended to constitute or result in deferred compensation subject to the requirements of section 409A of the Code. However, to the extent any amount payable under this Award Agreement is subsequently determined to constitute deferred compensation subject to the requirements of section 409A of the Code, this Award Agreement shall be administered in accordance with the requirements of section 409A of the Code. In such case, distributions made under this Award Agreement may only be made in a manner and upon an event permitted by section 409A of the Code. To the extent that any provision of this Award Agreement would cause a conflict with the requirements of section 409A of the Code, or would cause the administration of this Award Agreement to fail to satisfy the requirements of section 409A of the Code, such provision shall be deemed null and void to the extent permitted by applicable law. In no event shall the Participant, directly or indirectly, designate the calendar year of distribution. For purposes of section 409A of the Code each payment made under this Award Agreement shall be treated as a separate payment. This Award Agreement may be amended without the consent of the Participant in any respect deemed by the Committee to be necessary in order to preserve compliance with section 409A of the Code.

16. Governing Law . This grant shall be deemed to be made under and shall be construed in accordance with the laws of the Commonwealth of Pennsylvania, without giving effect to the conflicts of laws provisions thereof.

17. Notice . Any notice to be given to the Company shall be in writing and shall be addressed to the Treasurer of the Company at its principal executive office, and any notice to be given to the Participant shall be addressed to the Participant at the address then appearing in the records of the Company, or at such other address as either party hereafter may designate in writing to the other. Except as otherwise set forth herein, any such notice shall be deemed to have been duly given, made and received only when personally delivered, or on the day delivery is guaranteed when transmitted, addressed as aforesaid, to a third party company or governmental entity providing delivery services in the ordinary course of business, or two days following the day when deposited in the United States mails, by registered or certified mail, postage prepaid, return receipt requested, addressed as aforesaid..

[Signature Page Follows]

[Performance-based Vesting]

IN WITNESS WHEREOF, the Company has granted this Target Unit on the day and year first above written.


	LIBERTY PROPERTY TRUST
	By:
		Print Name and Title:

I hereby accept the Target Units described in this Award Agreement. I have read the terms of the Plan and this Award Agreement, and agree to be bound by the terms of the Plan and this Award Agreement and the interpretations of the Committee with respect thereto.


		ACKNOWLEDGED:

		By:

		Participant

Exhibit A
Performance Goals

EXHIBIT 12.1 — STATEMENT RE: COMPUTATION OF RATIO
OF EARNINGS TO FIXED CHARGES
AND RATIO OF EARNINGS TO COMBINED FIXED CHARGES

LIBERTY PROPERTY TRUST / LIBERTY PROPERTY LIMITED PARTNERSHIP
(Amounts in thousands except ratio amounts)


	Three months ended
	March 31, 2008

Earnings before fixed charges:
Income before allocation of minority interest and income from investments in unconsolidated subsidiaries	$	36,858
Add: Interest expense		41,288
Depreciation expense on cap’d interest		263
Amortization of deferred financing costs		1,162


Earnings before fixed charges	$	79,571


Fixed charges:
Interest expense	$	41,288
Amortization of deferred financing charges		1,162
Capitalized interest		6,843


Fixed charges		49,293


Preferred share distributions		—
Preferred unit distributions		5,253


Combined fixed charges	$	54,546


Ratio of earnings to fixed charges		1.61


Ratio of earnings to combined fixed charges		1.46

Exhibit 31.1

LIBERTY PROPERTY TRUST

CERTIFICATIONS REQUIRED BY
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

I, William P. Hankowsky, certify that:

1. I have reviewed this Form 10-Q of Liberty Property Trust;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting,

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.



Date: May 8, 2008	By:	/s/ WILLIAM P. HANKOWSKY
		William P. Hankowsky
		Chairman, President and Chief Executive Officer

Exhibit 31.2

LIBERTY PROPERTY TRUST

CERTIFICATIONS REQUIRED BY
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

I, George J. Alburger, Jr., certify that:

1. I have reviewed this Form 10-Q of Liberty Property Trust;

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.



Date: May 8, 2008	By:	/s/ GEORGE J. ALBURGER, JR.
		George J. Alburger, Jr.
		Executive Vice President and Chief Financial Officer

Exhibit 31.3

LIBERTY PROPERTY LIMITED PARTNERSHIP

CERTIFICATIONS REQUIRED BY
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

I, William P. Hankowsky, certify that:

1. I have reviewed this Form 10-Q of Liberty Property Limited Partnership;

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.



Date: May 8, 2008	By:	/s/ WILLIAM P. HANKOWSKY
		William P. Hankowsky
		Chairman, President and Chief Executive Officer of Liberty Property Trust, the Registrant’s sole general partner

Exhibit 31.4

LIBERTY PROPERTY LIMITED PARTNERSHIP

CERTIFICATIONS REQUIRED BY
RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

I, George J. Alburger, Jr., certify that:

1. I have reviewed this Form 10-Q of Liberty Property Limited Partnership;

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.



Date: May 8, 2008	By:	/s/ GEORGE J. ALBURGER, JR.
		George J. Alburger, Jr.
		Executive Vice President and Chief Financial Officer of Liberty Property Trust, the Registrant’s sole general partner

Exhibit 32.1

LIBERTY PROPERTY TRUST

CERTIFICATIONS REQUIRED BY
RULE 13a-14(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934

In connection with the Quarterly Report of Liberty Property Trust (the “Company”) on Form 10-Q for the quarterly period ended March 31, 2008 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, WILLIAM P. HANKOWSKY, President and Chief Executive Officer of the Company, certify in connection with Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, that based on my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.



/s/ WILLIAM P. HANKOWSKY
William P. Hankowsky
Chairman, President and Chief Executive Officer

Date: May 8, 2008

Exhibit 32.2

LIBERTY PROPERTY TRUST

CERTIFICATIONS REQUIRED BY
RULE 13a-14(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934

In connection with the Quarterly Report of Liberty Property Trust (the “Company”) on Form 10-Q for the quarterly period ended March 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, GEORGE J. ALBURGER, JR., Executive Vice President and Chief Financial Officer of the Company, certify in connection with Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, that based on my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.



/s/ GEORGE J. ALBURGER, JR.
George J. Alburger, Jr.
Executive Vice President and Chief Financial Officer

Date: May 8, 2008

Exhibit 32.3

LIBERTY PROPERTY LIMITED PARTNERSHIP

CERTIFICATIONS REQUIRED BY
RULE 13a-14(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934

In connection with the Quarterly Report of Liberty Property Limited Partnership (the “Company”) on Form 10-Q for the quarterly period ended March 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, WILLIAM P. HANKOWSKY, President and Chief Executive Officer of Liberty Property Trust (the sole general partner of the Company), certify in connection with Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, that based on my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.



/s/ WILLIAM P. HANKOWSKY
William P. Hankowsky
Chairman, President and Chief Executive Officer of Liberty Property Trust, the Company’s sole general partner

Date: May 8, 2008

Exhibit 32.4

LIBERTY PROPERTY LIMITED PARTNERSHIP

CERTIFICATIONS REQUIRED BY
RULE 13a-14(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934

In connection with the Quarterly Report of Liberty Property Limited Partnership (the “Company”) on Form 10-Q for the quarterly period ended March 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, GEORGE J. ALBURGER, JR., Executive Vice President and Chief Financial Officer of Liberty Property Trust (the sole general partner of the Company), certify in connection with Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, that based on my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.



/s/ GEORGE J. ALBURGER, JR.
George J. Alburger, Jr.
Executive Vice President and Chief Financial Officer of Liberty Property Trust, the Company’s sole general partner

Date: May 8, 2008

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